"France Telecom-Orange will propose to the Board of Directors the payment in September 2012 of an interim dividend of 0.60 euros per share for the fiscal year 2012. Besides, the Group confirms the payment of a dividend of 1.40 euros for 2011, with the balance of 0.80 euros per share to be paid in cash on 13 June 2012."
"The amounts allocated to the 2012 dividend will fall in a range of 40% to 45% of operating cash flow generated."
They are letting us know that in future years the dividend may rise or fall in euro terms based on cash flow. That is good policy.
Another thing we (i.e. US investors) have to worry about is possibly higher French withholding taxes on dividends paid on ADRs, currently 25%, especially if Hollande wins the election. My shares are in an IRA, but it might be smart to switch them to a taxable account at least for this year so I can get a credit for "foreign tax paid," which will exceed the US tax on qualified dividends, currently 15%. However, US tax policy may change in 2013, which could tip the scales. I'd appreciate any suggestions.
Holding FTE in a taxable account would handle the higher French tax; except that Obama intends to raise the tax on your dividends--so you will pay a higher tax anyway. More worrisome, is that Hollende advocates reducing the dividends themselves in favor of higher wages to union employees and higher corporate taxes. That means less cash flow=less dividends paid out=share price reduction (when people find out dividends will be less many will sell.) Dividend investors in the U.S. will be facing something similar in 2013 if Obama wins in the U.S. Obama has already said he will increase tax rate on dividends--and he intends to raise corporate taxes. Obama will help unions force higher wages. Same as Hollende. These are major issues for retirees who are terrified of growth stocks and can't get yield in bonds or CD's.