Although the pandemic is now behind us, many businesses had to struggle through those tough years as the world literally shut down.
Hence, it’s no surprise that most companies saw their profits and cash flows plunge during those dark days.
In many cases, dividends were either slashed or eliminated as these businesses strived to conserve cash.
There was, however, a small group of blue-chip stalwarts that managed to post three consecutive years of dividend increases.
We highlight four of these resilient stocks that you may wish to include in your buy watchlist.
DBS Group (SGX: D05)
DBS needs no introduction, being the largest bank in Singapore by market capitalisation.
The lender not only provides a comprehensive range of banking and investment services but has also demonstrated resilience during the pandemic years.
In 2020, the Monetary Authority of Singapore (MAS) mandated that all banks reduce their dividend payouts to 60% of the preceding year.
As a result, DBS slashed its quarterly dividend from S$0.30 back then to S$0.164.
2020 saw the bank end up paying a total dividend of S$0.791.
DBS has since gone on to increase its annual dividend over the next three years as interest rates started shooting up in 2022.
2021 saw the bank pay out S$1.091 while 2022’s dividend increased to S$1.818 and included a special dividend of S$0.0455.
2023’s dividend came up to S$1.746, which was higher than 2022’s core dividend of S$1.364.
It is no mean feat for DBS to raise its dividends over three straight years, and 2024 looks poised to be another strong year for the bank.
For the first half of 2024 (1H 2024), its net profit increased by 9% year on year to a new record of S$5.8 billion on broad-based growth in total income.
The bank declared a quarterly dividend of S$0.54, up nearly 23% year on year from the prior year’s S$0.44.
Looking ahead, CEO Piyush Gupta expects 2024 to record a double-digit year-on-year increase in non-interest income.
Net profit for this year should also grow by mid-to-high single-digits.
CapitaLand Integrated Commercial Trust (SGX: C38U)
CapitaLand Integrated Commercial Trust, or CICT, is a retail and commercial REIT with a portfolio of 21 properties in Singapore, two in Germany, and three in Australia.
CICT’s assets under management (AUM) stood at S$24.5 billion as of 31 December 2023.
Like DBS, CICT pulled off an impressive achievement of having three consecutive years of increasing distributions.
The REIT’s distribution per unit (DPU) jumped from S$0.0869 in 2020 to S$0.104 in 2021.
In the next two years, DPU increased to S$0.1058 for 2022 and then S$0.1075 in 2023.
This steady growth in DPU can be attributed to CICT’s robust portfolio of properties that has seen strong demand throughout the crisis.
2024 looks to be another banner year for the retail and commercial REIT.
For 1H 2024, DPU inched up 2.5% year on year to S$0.0543. If the REIT can keep this performance up, it could see a fourth consecutive year of DPU increase.
Meanwhile, operating metrics stayed healthy with a portfolio occupancy rate of 96.8% as of 30 June 2024.
Rental reversion was also positive for both its retail and office divisions at 9.3% and 15%, respectively.
Sembcorp Industries (SGX: U96)
Sembcorp Industries, or SCI, is an energy and urban solutions provider that delivers sustainable solutions to support energy transition.
The group owns a balanced energy portfolio of 21.2 GW across 10 countries of which 14.4 GW comprises renewable energy assets.
SCI has demonstrated impressive growth from 2020 to 2023 despite the onset of the pandemic and subsequent sharp rise in interest rates.
Revenue went from S$5.4 billion in 2020 to S$7 billion in 2023 as the group bulked up its renewable energy portfolio.
The utility giant went from a net profit (from continuing operations) of S$157 million in 2020 to S$1 billion in 2023.
As a result, SCI’s annual dividend rose from just S$0.04 in 2020 to S$0.05 in 2021, and then jumped to S$0.12 in 2022 and S$0.13 in 2023.
For 1H 2024, SCI reported a downbeat set of earnings with revenue falling 12% year on year to S$3.2 billion.
Net profit before exceptional items also tumbled 12% year on year to S$532 million.
Despite the fall in profit, the group paid out an interim dividend of S$0.06, higher than the S$0.05 paid out in 1H 2023.
Singtel (SGX: Z74)
Singtel should also be no stranger to investors as it is Singapore’s largest telecommunication company (telco).
Since announcing its strategic reset back in fiscal 2021 (FY2021), the telco has gone on to pay out higher dividends.
The annual dividend was S$0.075 back in FY2021 but this increased to S$0.093 in FY2022.
FY2023 saw the annual dividend increase further to S$0.099 but the biggest jump came in FY2024 when Singtel’s total dividend came in at S$0.15.
This S$0.15 included S$0.038 of “value realisation dividend” (VRD).
The VRD is a new component of Singtel’s dividend policy and will range from S$0.03 to S$0.06 annually.
The telco reiterated that this VRD is embedded into its group dividend policy and should not be seen as a “one-off” payment.
A total of S$8 billion of assets have been recycled since Singtel initiated its strategic reset, with the divestment proceeds allocated to growth opportunities and to pay down debt.
The telco has identified an additional S$6 billion of assets to be recycled in the mid-term, with the proceeds helping to fund its VRD.
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Disclosure: Royston Yang owns shares of DBS Group.
