LONDON (Reuters) - British clothing retailer Next (L:NXT) said on Tuesday a "procedural oversight" relating to the payment of dividends meant it had infringed UK company law and it would have to convene a meeting of shareholders to remedy the situation.
The issue relates to the payment of one ordinary interim dividend and three special interim dividends in 2014 and 2015.
Next said that whilst it had sufficient reserves to pay the dividends at the time that they were made, the law required this to be demonstrated by reference to interim accounts filed at Britain's Companies House prior to payment.
It said those interim accounts were not filed with Companies House until after the dividends had been paid and after the lapse had been identified, resulting in a technical breach of the UK Companies Act 2006.
Next said there was no change to its financial outlook, the matter had no impact on its ability to continue to return surplus cash to investors, its past accounts would not need to be restated and no fines or other penalties had been incurred.
However, it has convened a Feb. 10 meeting of shareholders to seek approval for a resolution to "address the situation and put all parties back in the position they were intended to be had the full technical requirements of the Act been complied with at the time the relevant distributions (dividends) were made."
Earlier this month, Next reported disappointing sales in the run-up to Christmas, blaming unusually warm weather.