The changes in the tax treatment of scrip dividends in last year's Budget - where dividends are paid in shares rather than cash - has led Waterford Wedgwood to scrap its scrip dividend scheme and for the foreseeable future, the group will give dividends to shareholders in cash. The Budget abolished the preferential treatment of scrip dividends and these are now treated as income in the same manner as cash dividends.

The abolition of the scrip dividend is immediate and the 0.4p interim dividend in respect of the half-year to the end of June will now be paid in cash, as will future dividends.

As an alternative to the scrip dividend, the Waterford Wedgwood board is considering introducing a dividend reinvestment plan next year.