COMPANIES in the UK paid shareholders dividends worth £79.8 billion in 2013, a fall of 1% on the previous year.
The latest Dividend Monitor from Capita Asset Services said the decline was because there were fewer special dividends paid throughout last year.
That figure came in at £2.4bn in 2013, which was down from £7bn as large pay-outs from the likes of Vodafone and Cairn Energy did not re-occur.
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On an underlying basis dividends grew 6.8% but the pace slowed across the 12 months with the fourth quarter up just 4.4% year-on-year.
Justin Cooper, chief executive of shareholder solutions at Capita Asset Services, said: "UK dividends ended 2013 with a whimper.
"Sustaining the stellar dividend growth of 2011 and 2012 was always going to be difficult, but in the event 2013 has been a harder year for income investors than expected.
"Growth is still there, but it has been slowing sharply."
However, investors should expect a better 2014 buoyed by a £16.6bn plan by Vodafone to return money to its shareholders following the disposal of its stake in Verizon. The researchers predicted dividend payments would top £100 billion this year, which would be a new record. Mr Cooper said equity yields were still attractive even after stripping out the Vodafone effect.