Australian dividends would have shown zero growth yet again during the first three months of 2019 were it not for a special payout from resources giant BHP and growth at Woodside Petroleum.
Economic uncertainty appeared to have little impact on global dividends in the three months to March 31, according to the latest Janus Henderson Global Dividend Index on Monday, with 7.8 per cent growth on a headline basis to a record $US263.3 billion.
But the global asset management group’s research revealed Australian dividends continued a five-year trend of zero growth, while companies from Asia Pacific nations – excluding Japan – delivered the world’s strongest dividend growth since 2009.
Only once mining company BHP’s combined $US6.6 billion special dividend and franking credit payout was taken into account did Australian dividends show modest growth of 3.8 per cent during the quarter.
Janus Henderson said the trend should be a major concern for investors who focus solely on local dividends for income.
“(It should) really encourage them to look globally for reliable, growing income,” the firm said in a release.
The biggest contribution to dividend growth in Australia during Q1 came from Woodside Petroleum, which more than doubled its final dividend in February to a fully franked $1.2706 per share after a challenging couple of years.
Telco giant Telstra, however, cut its final payout from 11 cents to eight cents the same month after a 28 per cent dive in first-half profit.
Commonwealth Bank held its interim dividend flat at $2 in line with a wider trend across the banking sector in Australia.
Janus Henderson analyses dividends paid by the 1,200 largest firms by market capitalisation.
The United States and Canada broke all-time quarterly dividend records during the reporting period with US dividends hitting a record $US122.5 billion, up 8.3 per cent on a headline basis, with underlying growth even better at 9.6 per cent.
US growth has exceeded the global average about 70 per cent of the time over the last five years, as company profits have benefited from a robust economy and favourable tax changes.
For the full year, Janus Henderson expects global dividends to reach a record $US1.43 trillion, up 4.2 per cent in headline terms, and 5.2 per cent on an underlying basis.
Higher special dividends than originally expected are likely to be broadly offset by a more negative impact from exchange rates, the firm said.