Use thefollowinginformationaboutOceanicLtd.'s capital structure to answer the questions below;

Oceanic's capital structure is made up of;

CAPITAL STRUCTURE

DEBT

• Bonds

EQUITY

• Preference Shares
• Ordinary Shares
• Oceanic Ltd. has130,000bondsoutstandingwithafacevalueof$100each. These bonds have8yearstomaturityandpayanannualcoupon of 7.5%.Oceanic'sstatutorycorporatetaxrateis30%.
• Moody's Corporation is one of a bigratingsagency which has given Oceanic Ltd. a debt rating of AA. The following table shows the current yields available in the market based on debt ratings.
• The risk-free rate offered by the government on bonds is 1%.

Debt rating

Risk premium

AAA

5.8%

AA

6.5%

BBB

7.2%

BB

7.5%

• Oceanic Ltd.hasissued4millionpreference shares, which pay anannualdividend per share of $0.375.Theyare currentlytradingat$3.75each.
• Oceanic Ltd.hasissued8millionordinaryshares,whicharecurrentlytradingat$5each.Shareholders are to receive a dividend of $0.70 per share in the current year,andthisdividendisestimatedtogrowataconstantrateof2.5%inperpetuity.

NOTE:Round all dollar amounts to the nearest dollar and all percentages to two decimal places.

Assume the preference shares issued by Oceanic Ltd. arecumulative. Assume the company doesn't pay any dividends this year on both Preference and Ordinary Shares. Nonetheless, next year, the company estimates that $3 million will be available to be paid out as dividends. Calculate the dividends per share the ordinary shareholders are expected to receive next year?