United Carpets shares up after confirming special dividend

United Carpets' shares advanced more than 10% after it confirmed a special dividend of 1p a share.

The third largest chain of specialist retail carpet and floor covering stores in the UK said the dividend would be paid on 25 May, going ex-dividend on 19 May.

"In order for the Company to be in a position to pay the special dividend, it must have distributable reserves," said United Carpets.

"Therefore, in order to satisfy this requirement, the company has delivered to Companies House its company unaudited interim results for the six month period ended 30 September 2016."

Chief executive Paul Eyre said the special dividend demonstrated the continuing, strong cash generation of the company, reflecting the improvements made in the business.

"Dividend distributions will remain an important part of the board's strategy going forwards and when deciding on future, regular dividend payments, we will consider modest reductions in dividend cover subject to any overriding requirements of the business to fund future growth."

At 14:39 BST, shares in AIM-quoted United Carpets were up 10.98% to 11.38p each.