Yahoo Finance Stock markets: Mining and oil shares drive dividend payouts to first quarter record
Global dividends surged 11% to a first quarter record of $302.5bn (£240.5bn/€282.1bn) driven by mining and oil firms.
UK dividends fell by 21.5% to $14.7bn between January and March, after payouts were boosted to $18.8bn last year by bumper special dividends, according to the Janus Henderson Global Dividend Index.
But on an underlying basis — excluding one-off special dividends — UK payouts grew 14.2%.
“Oil companies were the main driver of the increase, but mining groups will begin to contribute very strongly from the second quarter.
“Healthcare payouts also rose, after AstraZeneca’s (AZN.L) first dividend hike in nearly 10 years, while the restoration of telecom operator BT’s distribution after a two-year pause also made a significant contribution to growth,” the report said.
Globally, 81% of companies that issued payouts in the first quarter increased their dividends year on year and another 13% held them steady.
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Mining company payouts jumped almost 30% in the first quarter of 2022 compared with the year before, according to the index.
“Both oil and metal prices have been propelled higher following the Russian invasion of Ukraine, helping to sustain dividend growth in these sectors for the time being.”
BHP (BHP.L) topped the list of the world's biggest dividend payers in the quarter, followed by Swiss pharmaceuticals group Novartis (NVS).
Danish shipping company AP Møller-Maersk (MAERSK-B.CO) delivered the largest single dividend increase in the quarter, as it benefited from high shipping rates.
Analysts at the fund manager expect steady dividend growth to continue during 2022.
“Global dividends had a good start in 2022, helped by particular strength from the oil and mining sectors,” said Jane Shoemake, client portfolio manager for global equity income.
Janus Henderson has now hiked its forecast for the year, with $1.54tn expected to be paid out to investors in total, after 94% of firms decided to raise payouts or hold them steady in the first quarter.
However, the war in Ukraine, high energy and commodity prices, record inflation and rising interest rates are all likely to impact companies' dividend prospects.
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“The world’s economy nevertheless faces a number of challenges — the war in Ukraine, rising geopolitical tensions, high energy and commodity prices, rapid inflation and a rising interest rate environment. The resultant downward pressure on economic growth will impact company profits in a number of sectors.”
Overall 94% of companies in the index increased or maintained dividend levels, and every region saw double-digit growth.
