There are some S&P/ASX 200 Index (ASX: XJO) shares that continue to grow their dividend payments.
Plenty of previously-popular ASX dividend shares didn’t increase their dividends in 2020. Indeed, there were plenty of dividend cuts. Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), National Australia Bank Ltd (ASX: NAB), Australia and New Zealand Banking Group (ASX: ANZ), Woodside Petroleum Limited (ASX: WPL), BHP Group Ltd (ASX: BHP), Sydney Airport Holdings Pty Ltd (ASX: SYD), Transurban Group (ASX: TCL), Scentre Group (ASX: SCG), Macquarie Group Ltd (ASX: MQG) and Ramsay Health Care Limited (ASX: RHC) all cut their dividends this year.
But these ASX 200 shares do keep increasing their dividend:
Magellan Financial Group Ltd (ASX: MFG)
Magellan is a funds management business that has been operating for almost a decade and a half. It has been growing its funds under management (FUM) for many years. It passed $100 billion of FUM recently and this continues to rise thanks to the investment performance and continuing inflows of funds.
In FY20 its average FUM went up by 26% to $95.5 billion. This helped drive the adjusted earnings per share (EPS) higher by 17% to 241.5 cents. Total dividends from Magellan went up 16% to 214.9 cents per share.
The ASX 200 share has been investing in other businesses recently. It has invested in both Barrenjoey and Guzman y Gomez. Barrenjoey is a new full-service investment bank that will provide corporate and strategic advice, equity and debt capital market underwritings, cash equities, research, prime brokerage as well as traditional fixed income services to Australian and international clients. Guzman y Gomez is an Australian based quick service restaurant chain specialising in made to order, fresh Mexican food with 147 restaurants across Australia, Singapore, Japan and the US.
At this Magellan share price, it has a trailing partially franked dividend yield of 3.9%.
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
Soul Patts is the ASX 200 share with the longest dividend growth streak. It has actually increased its dividend every year since 2000.
It’s an investment conglomerate that receives dividends and distributions from its portfolio of businesses, which in turn funds its own dividend.
Some of the biggest positions in the Soul Patts portfolio are ASX 200 shares themselves: TPG Telecom Ltd (ASX: TPG), Brickworks Limited (ASX: BKW), Bki Investment Co Ltd (ASX: BKI), Milton Corporation Limited (ASX: MLT), Australian Pharmaceutical Industries Ltd (ASX: API) and New Hope Corporation Limited (ASX: NHC).
The company takes long-term positions in businesses, it isn’t a trader. But it doesn’t just own listed businesses, it also has a portfolio of unlisted investments. Its holdings include agriculture, resources, swimming schools, financial services and a business called Ampcontrol.
Collins Foods is a large franchisee of KFC outlets in Australia, the Netherlands and Germany. Europe is still suffering under the weight of COVID-19 infections, which is affecting Collins Foods’ earnings.
A few weeks ago the company announced its FY21 half-year result which showed total revenue went up 11.3% to $500 million. KFC Australia revenue went up 15.6% to $415.5 million with same store sales (SSS) growth of 12.4%. However, KFC Europe SSS fell 4.2% because of COVID-19 restrictions.
Whilst the ASX 200 share is working on increasing the number of outlets its store network, the management were focused on improving delivery options for customers during this COVID-19-affected year.
Collins Foods’ HY21 underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rose 10.5% to $63.7 million and underlying net profit after tax (NPAT) went up 15.1% to $27.5 million.
This result funded a 10.5% increase to the interim dividend to 10.5 cents per share. At the current Collins Foods share price, it has a trailing fully franked dividend yield of 2.1%.
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Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of and has recommended Brickworks, Macquarie Group Limited, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns shares of Transurban Group. The Motley Fool Australia has recommended Collins Foods Limited and Ramsay Health Care Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
