The Telstra Corporation Ltd (ASX: TLS) share price is gaining this morning amid reports the company's chief finance officer (CFO) expects to maintain or increase its dividend in the future.
Telstra CFO Vicki Brady reportedly told an online retail shareholder event that boosting the company's fully franked 16 cent dividend was its priority.
At the time of writing, the Telstra share price is $3.93, 0.9% higher than its previous close.
That's ever so slightly better than the performance of the broader market. Right now, the S&P/ASX 200 Index (ASX: XJO) is up 0.8% while the All Ordinaries Index (ASX: XAO) is up 0.7%.
Let's take a closer look at today's news from Telstra.
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Telstra focuses on dividends
The Telstra share price is climbing amid reports it will continue to focus on growing its dividends.
According to reporting by The Australian, Brady, alongside Telstra's CEO Andy Penn, reiterated the recently released T25 growth strategy yesterday.
The T25 strategy was announced on 16 September. The Telstra share price gained 0.5% on the back of its new action plan.
The growth strategy aims to increase Telstra's bottom line. As Brady noted, doing so will boost the amount the company can pay out in dividends.
Additionally, a bigger bottom line will increase the franking balance Telstra can put on its dividends. The publication quoted Brady as saying:
We haven't put a time on that, we've just said that we will seek to grow the fully franked dividend over time. And it's very much linked to achieving our underlying earnings growth ambitions that we've got as part of T25.
Over the financial year 2021, Telstra provided its shareholders with an interim dividend and a final dividend, each worth 5 cents. It also provided 2 special dividends at 3 cents each.
The telco's T25 growth strategy aims to see it reporting a compound annual growth rate of mid-single digits for its earnings before interest, tax, depreciation, and amortisation (EBITDA).
It also aims to see underlying earnings per share (EPS) reach the mid-teens between now and financial year 2025.
Telstra share price snapshot
The Telstra share price has gained 30.5% since the start of 2021. It is also 40.3% higher than it was this time last year.
