Standard Life Lifts Dividend by 6.5% and Reveals Special Payout

LONDON -- The shares of Standard Life  (LSE: SL  )  advanced 9 pemce, or 2%, to 383 pence during early London trade this morning after the investment group raised its annual dividend by 6.5%.

A 14.7 pence per share payout was announced for 2012, up from the 13.8 pence per share declared for 2011.

The FTSE 100 member also revealed it will pay 302 million pounds to shareholders as a special dividend, equivalent to 12.8 pence per share.

The dividend news accompanied full-year results that showed pre-tax profits surging an impressive 65% to 900 million pounds. Standard Life said the performance benefited from greater fee-based revenues, lower operating costs, and a 96 million-pound one-off indemnity claim.

Profits from the U.K. came in at 382 million pounds, while profits from Canada were not far behind at 355 million pounds. A further 145 million-pound profit was generated through Standard Life's Investment division, which saw third-party client assets advance 11 billion pounds to 83 billion pounds.

David Nish, Standard Life's chief executive, said:

Standard Life has delivered a substantial increase in profitability and has a strong capital position supporting increased dividends for our shareholders.

Standard Life has undergone considerable change over the past three years. As a result we now have significant opportunities for further strong and sustainable growth.

Looking ahead, Mr Nish claimed Standard Life's U.K. business remained "well positioned to benefit from regulatory, market and demographic changes."

He also said the group would continue to apply its progressive dividend policy, taking into account its financial performance and general market conditions.

Based on this morning's results, Standard Life's shares trade at 13 times earnings and offer a 3.8% yield. Sadly the price is not the bargain it once was, having almost doubled since its low of last year.

Of course, whether today's results, that 302 million-pound special dividend as well as the wider prospects for the savings and investment sector still combine to make Standard Life a buy remains your decision.

However, if you already own Standard Life shares and are looking for a different investment opportunity, you may wish to read this exclusive in-depth report about a high-yield alternative within the FTSE 100.

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