Dividend CoverDividend Cover ratio, is calculated as the earnings per sharebasic (EPSbasic) divided by the annual total dividend amount per share. Dividend cover expresses a company's ability to pay ordinary dividends to shareholders out of profits earned. It shows how many times the ordinary dividend is covered by the profit available and, for example, if a company pays out one quarter of its profit as dividends, then the Dividend cover ratio is four. The calculation is the following:
= EPSbasic / annual dividend per share (DPS)
