Last update: 01/08/2025

Shareholders and investors need to understand financial concepts about listed companies. One that really interests them is the “payout”: the share of profits that a company “pays out” to them. Below is everything you need to know about payouts.

A payout is the share of profits that a listed company will pay its shareholders. If the payout set out in the company’s shareholder remuneration policy is 50%, the company will distribute half of its net profits among its shareholders. 

If that policy says the 50% payout should be split between a cash dividend and share buybacks, the formula is:

Payout = (cash dividend + share buyback)/underlying net profit. The payout is expressed as a percentage. 

Remember, a dividend is cash paid to shareholders for their share in the company's profits. A share buyback and the subsequent cancellation of shares are when the company “buys back” its own shares to reduce outstanding share capital and increase its share price.

Why do payouts matter to shareholders?

The payout is an indicator that influences an investor’s decision to buy shares in a company. It shows what share of the company’s profits will be paid to shareholders, whether in a cash dividend, a share buyback or both.

What does this mean? 

A payout policy can also help attract more long-term investment in a listed company. But the company must find the right balance between shareholder returns and reinvesting in its own long-term growth. A payout gives substance to shareholder remuneration policies, which influence investors’ decisions.

Santander’s payout

The 2025 AGM approved a final cash dividend charged against 2024 results in the gross amount of €11.00 cents per share paid on 2 May 2025. Including the interim cash dividend paid in November 2024 (€10.00 cents), the total cash dividend per share paid against 2024 results was €21.00 cents, around 19% more than the dividends paid against 2023 results.

Additionally, we completed two share buyback programmes for a total of  €3,112 million. The Group has now repurchased more than 14% of its outstanding shares since we began our buybacks in 2021.

Including these cash dividends and share buybacks, total shareholder remuneration against 2024 results was €6,287 million, 13% higher than the remuneration against 2023 results, distributed approximately equally between cash dividends and share buybacks.

As announced on 5 February 2025, the shareholder remuneration policy that the board intends to apply for the 2025 results consists of a total shareholder remuneration of approximately 50% of the Group reported profit (excluding non-cash, non-capital ratios impact items), to be distributed in approximately equal parts between cash dividends and share buybacks.

Additionally, on the same date, the board announced its objective to allocate €10 billion to shareholder remuneration in the form of share buybacks charged against 2025 and 2026 results, as well as anticipated capital excess. This target includes i) the buybacks that form part of the aforementioned shareholder remuneration policy, and ii) additional buybacks following the publication of the full year results, to distribute end-of-year CET1 excess capital. On 30 July 2025, the bank announced the launch of the first share buyback programme for 2025 results. You can find all the information about this buyback programme here.

On 5 May 2025, Santander announced its intention to distribute 50% of the capital released from the disposal of its 49% stake in Santander Bank Polska S.A., through a share buyback of approximately €3.2 billion in early 2026, as part of additional buybacks to distribute excess capital and, as a result, it could exceed the €10 billion target. Upon announcing the agreement to acquire TSB Banking Group plc on 1 July 2025, the bank confirmed its goal to distribute at least €10 billion in share buybacks charged against 2025 and 2026 results and excess capital.

The implementation of the shareholder remuneration policy and the aforementioned share buybacks are subject to future corporate and regulatory decisions and approvals.