Global dividend payments hit new record
Global dividend payments jumped to a record $497.4 billion in the second quarter, up 12.9 per cent from the same quarter in the previous year, according to the Janus Henderson Global Dividend Index.
Payments rose in almost every region of the world in headline terms, the investment manager said, with records broken in 12 countries. France, Japan, and the United States were some of the largest contributors to global income.
The Janus Henderson Global Dividend Index ended the quarter at a new record 182.0, meaning that global dividends have risen by more than four-fifths since 2009.
Underlying growth in dividends stood at 9.5 per cent, the fastest growth in three years, with Janus Henderson pointing to rising corporate profitability in all parts of the world as the driver of the higher payments.
The manager also raised its forecast for underlying dividend growth for 2018, which strips of exchange-rate effects, from 6.0 per cent to 7.4 per cent.
Ben Lofthouse, head of global equity income at Janus Henderson, said the second quarter exceeded the manager’s expectations in every region of the globe, and that income investors will be cheering record payouts and strong growth, with the potential for more to come.
“Looking further ahead, the impact on global trade of escalating tariff battles with the US could have a negative impact on corporate profitability, though its magnitude is highly uncertain at present,” Lofthouse said.
“Nevertheless, we are still optimistic that in aggregate corporate earnings can continue to grow next year, and payout ratios in key parts of the world like Japan have scope to rise further too.
“Dividends in any case are less volatile than profits, and we are confident that 2019 will see the global total continue to rise in underlying terms.”
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