An analysis by Janus Henderson shows 20 companies that paid out the most money to their shareholders in 2023. Javier Ghersi/Getty Images
In 2023, global dividends rose to a record $1.66 trillion, according to a report by Janus Henderson.
The banking industry contributed half of global dividend growth, while the mining industry weakened.
Europe excluding the UK and Japan were the biggest drivers of global dividend growth.
The British fund house Janus Henderson determines the world‘s largest dividend payers every quarter as part of its “Global Dividend Index”. It showed that dividends rose to a record $1.66 trillion in 2023 – this corresponds to an increase of 5 percent.
Banks as the main driver of dividend growth
The main driver of dividend growth was the banking industry, the report says. This recorded record distributions in 2023 and contributed to half of global dividend growth. The background: The higher interest rate environment enabled many banks to increase their margins. Financial institutions from emerging markets in particular made a particularly strong contribution to this increase. However, the situation was different in the mining industry, where profits fell in parallel with lower raw material prices.
Overall, 86 percent of companies increased or maintained their dividends. However, cuts at just five companies – BHP, Petrobras, Rio Tinto, Intel and AT&T – had a relatively large impact, reducing the global adjusted growth rate for the year by two percentage points.
These were the largest dividend payers in 2023
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Europe and Japan are the biggest growth drivers
22 countries posted record payouts, with Europe excluding the UK and Japan the biggest drivers of global dividend growth. Europe excluding Britain contributed two-fifths of the global increase. The region’s distributions rose 10.4 percent to a record $300.7 billion.
“With a total distributed amount of 51.9 billion euros, Germany was almost a third above the previous record from 2018. Volkswagen’s special dividend of 5.6 billion euros, which comes from the proceeds of the spin-off from Porsche, also contributed to this . Other automobile manufacturers also paid out more money to shareholders. An impressive 85 percent of all German dividend growth in 2023 can be attributed to this sector,” says Daniela Brogt, sales manager for Germany and Austria at Janus Henderson Investors.
The expert adds: “In contrast, the biggest negative impact came from the real estate company Vonovia, which was struggling with pressure on profitability due to higher interest rates and lower real estate prices. Nine out of ten German companies increased their dividends in 2023, which is in line with the global and European average.”
Janus Henderson expects these distributions for 2024
Janus Henderson expects 2024 to see similar growth to 2023. The British fund house forecasts dividends of $1.72 trillion for 2024, an increase of 3.9 percent on a total basis and adjusted growth of 5.0 percent.
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