Dividends surge around globe but UK figures drop

● Report cites ‘timing factors’ as cause of decline in British payouts

0 UK dividends fell 1.4% in the second quarter, compared with a global rise Global dividends hit nearly $500 billion (£392bn) in the second quarter while UK dividends dropped, according to figures released today.

According to the Janus Henderson Global Dividend Index, the world’s listed companies paid shareholders a record $497.4bn in the three months, a jump of 12.9 per cent year-on-year.

Records were broken in 12 countries, including France, Japan and the US.

However, payouts for UK listed companies fell 1.4 per cent to £25.2bn, with the report citing lower special dividends and “timing factors”, such as tobacco giant British American Tobacco’s switch to quarterly payouts, as key drivers for this decline. This was in contrast to the rest of Europe, where companies paid a record $176.5bn, an increase of 18.7 per cent compared with the previous year.

In underlying terms, which adjusts headline growth to allow for special dividends, change in currency and timing effects, the UK outstripped the worldwide average at 13.1 per cent, largely thanks to global mining groups listed in London that have seen profits rise.

The asset management group cautioned that exchange-rate effects “exaggerated” the worldwide headline performance, but calculated underlying global growth at 9.5 per cent, the fastest in three years.

Ben Lofthouse, head of global equity income at Janus Henderson, said he was optimistic for the coming year. He said: “The second quarter exceeded our expectations in every region of the globe, and income investors will be cheering record payouts and strong growth, with the potential for more to come. Even in out-of-favour regions, such as Europe, dividends continue to increase, driven by ongoing economic and earnings growth.

“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.

“Nevertheless, we are still optimistic that, in aggregate, corporate earnings can continue to grow next year. 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.”

“Income investors will be cheering record payouts and strong growth”