Melrose dividend: payments and cash cover
MyStockButler's October 2026 analysis: Melrose paid 7.20p per share in 2025. Its dividend was not covered by 2025 free cash flow: dividends and buybacks still exceeded that year's free cash flow.
How much does Melrose pay per share?
The dividend was 7.20p per share in 2025. Its durability depends on multi-year cash generation, not simply reported earnings.
| 2025 | 2024 | 2023 | 2022 | |
|---|---|---|---|---|
| EPS, diluted | 29.00 | -3.70 | 0.10 | -16.30 |
| Free cash flow per share | 7.60 | -19.71 | -9.54 | -9.74 |
| − Dividends paid, per share | 6.43 | 5.44 | 5.77 | 5.48 |
| − Share buybacks, per share | 13.56 | 32.55 | 6.62 | 35.85 |
Is Melrose's dividend covered by its cash?
The picture improved in 2025 because free cash flow turned positive. Yet dividends and buybacks still exceeded that year’s free cash flow, while net debt ended higher than it had the year before. The table shows the complete movement from operating cash through payouts, acquisitions, asset sales, investments, new shares and borrowing.
| 2025 | 2024 | 2023 | 2022 | |
|---|---|---|---|---|
| Free cash flow | 97 | -261 | -134 | -137 |
| − Dividends paid | 82 | 72 | 81 | 77 |
| − Share buybacks | 173 | 431 | 93 | 504 |
| = Paid out more than the free cash flow | 158 | 764 | 308 | 718 |
| Paid to shareholders | 255 | 503 | 174 | 581 |
What this means. In 2025, the company paid shareholders £255 million even though it generated only £97 million of free cash flow, so it used borrowing or savings to cover the difference.
Could Melrose's dividend change?
Dividends per share are £0.08 in the first two base periods and £0.09 in the third. The bear holds £0.07 throughout. The bull rises from £0.08 to £0.09 and then £0.11. The latest run-rate was 7.5p, and the Board explicitly follows a progressive policy, but 2025 free cash flow was only £97m against £255m of dividends and buybacks.
The November 18, 2026 trading update should reveal supplier output, Garden Grove production and refinancing progress. Full Garden Grove production was expected to return in the fourth quarter, subject to approvals. The decisive tests are positive GTF partnership cash in 2028, narrowing the gap between receipts and recognised RRSP income, progress toward £600m of free cash flow in 2029, falling debt and affordable buybacks.
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| Normal operating profit | 780 (680 / 850) | 930 (735 / 1,050) | 1,080 (820 / 1,250) |
| Dividends per share | 0.08 (0.07 / 0.08) | 0.08 (0.07 / 0.09) | 0.09 (0.07 / 0.11) |
| Net debt | 1,280 (1,424 / 1,262) | 1,035 (1,307 / 981) | 616 (1,090 / 510) |