KEY POINTS:
Tower New Zealand shareholders' five-year wait for dividends will soon be over, with chairman Tony Gibbs yesterday departing from the script at the company's annual meeting and pledging a return to payouts this year.
In the version of Gibbs' address to shareholders released to the market yesterday, he merely said the company's board "will consider the question of dividends in 2007".
"We will resume paying dividends as soon as it is possible and efficient."
However, Tower chief executive Rob Flannagan confirmed Gibbs "went a bit further" when addressing shareholders at his first annual meeting as chairman "and said as far as he's concerned he's going to pay a dividend this year".
"Tony was very adamant that we are going to pay a dividend this year."
Flannagan said Tower's board had made the decision at a meeting on Wednesday and had given management "strict instructions to come up with a paper as soon as possible as to the most tax-efficient way of paying a dividend".
"We've got to do everything we can to make it happen."
However, Flannagan would give no indication of the level of payout shareholders could expect to receive.
Tower shareholders have not received a dividend since 2002, shortly before a series of disastrous write-downs of the value of its businesses that precipitated a steep share price plunge and subsequent bail-out by way of a rights issue underwritten by its long-time suitor, Gibbs' Guinness Peat Group.
Gibbs said Tower NZ still had some way to go before the business was performing in line with expectations.
Flannagan said Tower's New Zealand investment division had a strong start to the current year and the health and life insurance divisions were gaining momentum.
However, the general insurance division had been hit by the cost of damage resulting from the rioting in Tonga.
Tower New Zealand split from its Australian arm late last year and has enjoyed a solid run up in share price in recent weeks. However, its shares eased 12c to $2.45 yesterday.
