Companies around the globe paid out a total of $339.2bn (£266.6bn) in dividends during the first quarter of 2024, according to Janus Henderson’s latest Global Dividend Index update.
This marks an annual increase of 6.8% on an underlying basis, which was largely boosted by record-high dividend growth in the US.
Payouts from US companies accelerated to the highest they ever have within a single quarter, up 7% over the first three months of the year and delivering $164.3bn to shareholders in total.
This all-time high was helped by mega-cap companies such as Meta and T-Mobile paying out dividends for the very first time. Janus Henderson estimates that these two companies alone will increase global dividend growth by almost half a percentage point between them this year.
Some US tech giants such as Apple and Microsoft have been paying dividends for many years, but the likes of Alphabet and Amazon have not followed suit.
Jane Shoemake, manager on the global equity income team at Janus Henderson, said: “Companies like these are recognising that paying dividends is an important route – beyond share buybacks – to return capital to their investors.”
See also: Could Meta dividend promise lead to the ‘Pringles conundrum’?
Dividend growth in the UK was comparatively uninspiring, according to Janus Henderson UK Responsible Income fund manager Andrew Jones, but climbed 2.4% in the first quarter to a total payout of $15.3bn all the same.
“In the UK, dividend growth was relatively pedestrian in the first quarter, although we do expect the situation to improve through the second half of the year as cost pressures ease, interest rates are cut, and the economy starts to recover, driven by real wage growth and a more buoyant consumer,” he added.
Much of the UK’s increased payouts came from special dividends, such as the one paid by Associated British Foods after a particularly strong Christmas period. It delivered a special dividend of 12.7p per share to investors in January in addition to its final dividend of 33.1p.
However, the largest increase over the period came from Compass as it ascended from its pandemic lows. Shares in the foodservice business are up 114% since its lowest point in 2020, and investors have been rewarded for holding on during its recovery.
While some dividend giants such as mining group Glencore did cut payouts this year, Janus Henderson still forecasts global dividends to reach $1.72 trillion by the end of 2024, representing a 5% annual increase on an underlying basis.
Shoemake said income investors have much to look forward to over the coming months, stating: “We have reasonable visibility over payouts in the crucial second quarter, which sees seasonal peaks in Europe, Japan and the UK.
“While a very small handful of large companies have announced significant dividend cuts, the broad picture is one of continued resilience, especially in Europe, the US and Canada.”
See also: Are income investors turning a blind eye to the world’s dividend powerhouse?
