Ramsay Health Care announces a fully franked ordinary distribution of AUD 2.9642 per security on its perpetual preference shares, reflecting a steady income stream for investors. The payment is scheduled for April 2026, subject to board and external approvals.
- Ordinary distribution of AUD 2.9642 per security announced
- Distribution relates to six-month period ending 19 April 2026
- Fully franked at 100%, reflecting Australian corporate tax credits
- Total annualised distribution rate of 5.9447% based on 180-day BBSW plus margin
- Payment subject to board resolution and external approval conditions
Ramsay Health Care’s Latest Distribution Announcement
Ramsay Health Care Limited has declared an ordinary distribution of AUD 2.9642 per security on its TRANS PREF 6-BBSW+ 4.85% perpetual subordinated preference shares. This announcement, made on 20 October 2025, outlines the payment schedule and key terms for the six-month period ending 19 April 2026.
Details of the Distribution
The distribution will be paid on 20 April 2026, with an ex-date of 2 April 2026 and a record date of 7 April 2026. Importantly, the dividend is fully franked, meaning it carries a 100% franking credit, reflecting the Australian corporate tax paid by Ramsay Health Care. This feature enhances the effective yield for Australian investors by reducing their tax liability on the income received.
Calculation and Rate Components
The total annualised distribution rate stands at 5.9447%, derived from the 180-day Bank Bill Swap Rate (BBSW) as of 20 October 2025 plus a margin of 4.85%. This margin was originally set as a stepped-up rate in 2010, reflecting the premium investors receive for holding these perpetual preference shares. The distribution period covers 182 days, aligning with the semi-annual payment schedule.
Conditions and Approvals
While the distribution amount and dates are clearly specified, the payment remains subject to the approval of Ramsay Health Care’s board and an external approval condition, which is not detailed in the announcement. This introduces a degree of uncertainty, although such conditions are standard for distributions on hybrid securities like these.
Investor Considerations
Investors holding these perpetual preference shares should note the fully franked nature of the distribution, which can be particularly attractive in the current tax environment. The reference to the CARES prospectus dated 27 April 2005 provides additional context on the terms governing these securities. Market participants will be watching for the board’s final resolution and any updates on the external approval process ahead of the payment date.
Bottom Line?
With a solid distribution rate and full franking, Ramsay’s perpetual preference shares remain a compelling income option, pending final approvals.
Questions in the middle?
- What is the nature of the unspecified external approval condition affecting payment certainty?
- How might changes in the 180-day BBSW impact future distribution rates on these securities?
- Will Ramsay Health Care maintain this distribution level amid evolving market and regulatory conditions?