Telstra hands back $4.5bn to investors
Telstra has announced it will focus on its existing local businesses and lift payments to shareholders, returning $1.5 billion to shareholders every year for the next three years through special dividends and share buybacks. The huge capital return comes as part of a strategic review which aims to increase the portion of Telstra's annual profit returned to shareholders in ordinary dividends. The plan to return 80 per cent of profits for the 2004-05 financial year will give Telstra the largest pay-out ratio on the S&P/ASX 100, according to ABN Amro. Telstra shares soared 4.6 per cent to $5.02 yesterday as analysts and fund managers welcomed the news that the telco is pulling back from its acquisitions strategy.