Dividend
Financial policy
In February 2006 the Board further optimized KPN's capital structure taking into account KPN's experience of operating under its existing financial policy, KPN's current and expected trading, overall developments in the European telecommunications market and credit rating agency considerations with respect to KPN. This financial policy allows KPN to continue with its policy of accommodating an attractive dividend policy, whilst maintaining flexibility to grow and invest in its business.
Dividend policy
In February 2008, KPN updated its medium-term dividend policy, according to which KPN expects to pay out a dividend between 40 and 50 percent of its annual free cash flow (defined as net cash flow provided by operating activities minus capital expenditures, plus proceeds from real estate and excluding tax recapture at E-Plus). KPN proposed to declare a cash dividend of EUR 0.54 per share in respect of the year ending December 2007, of which EUR 0.18 was paid out as an interim dividend in August 2007. KPN intends that the total amount of dividend paid over the fiscal year 2008 will be EUR 1 billion. As part of the dividend for 2008, KPN has declared an interim dividend of EUR 0,20 per ordinary share on 23 July 2008.
More information with regard to dividend history
Share repurchase program
KPN reaffirms it has no intention to hold unutilized surplus cash balances. We intend to return surplus cash to shareholders via either additional special dividends or share repurchases. Such repurchases will only be undertaken at a price, which enhances value for the remaining shareholders.
To this end, KPN repurchased EUR 1.5 billon in shares in 2007. The share repurchase program consisted of an initial EUR 1.0 bn program finished in August 2007 and an additional program of EUR 0.5 bn that started in August 2007. All share repurchased in 2007 have been cancelled. KPN has started another EUR 1 bn repurchase program in February 2008, that will run until the end of the year.
