Dividends can be said to be an investor’s best friend.
Not only do they put money in your pocket, but they also represent a tangible return on your investments.
Income investors have a goal to steadily improve their dividend income by purchasing shares of dividend-paying companies that raise their payouts.
If you are looking to increase your passive income flow, these four Singapore stocks could be the right ones for you.
United Overseas Bank (SGX: U11)
United Overseas Bank, or UOB, is Singapore’s third-largest bank by market capitalisation.
The bank offers a comprehensive range of banking, insurance, and investment services for both individuals and corporations.
For 2024, UOB reported a healthy set of earnings that saw growth in both its top and bottom lines.
Total income rose 3% year on year to S$14.3 billion while operating profit inched up 1% year on year to S$8.2 billion.
Net profit (excluding one-off expenses) increased 6% year on year to a record-high of S$6 billion.
In line with the good results, the bank declared a final dividend of S$0.92, up from the S$0.85 that was paid out in the previous corresponding period.
For 2024, UOB’s total dividends stood at S$1.80, 5.9% higher than the S$1.70 paid out for 2023.
In addition, the lender announced a capital distribution package comprising a special dividend of S$0.50 and a new share buyback programme of S$2 billion.
This special dividend, to be paid out over two tranches this year, is to mark the bank’s 90th anniversary.
This total package, comprising S$3 billion, is the bank’s plan to distribute surplus capital over the next three years.
Centurion Corporation (SGX: OU8)
Centurion Corporation is a provider of purpose-built worker accommodation (PBWA) assets in Singapore, Malaysia and China, and student accommodation assets (PBSA) in Australia, the UK, the US, and China.
The group owns and manages a portfolio of 37 accommodation assets totalling 69,929 beds as of 31 December 2024.
For 2024, Centurion reported a strong set of earnings with revenue jumping 22% year on year to S$253.6 million.
Gross margin continued to improve, going from 72.4% to 77.1%, resulting in gross profit surging by 30% year on year to S$195.6 million.
Net profit from core business operations soared 43% year on year to S$99.3 million.
A final dividend of S$0.02 was declared, 33% higher than the S$0.015 final dividend paid out a year ago.
For 2024, Centurion declared a total dividend of S$0.035, a healthy jump from the S$0.025 declared for 2023.
In Singapore, the group plans to redevelop its Westlite Toh Guan property to add a new block of around 1,764 beds by December 2025.
It will also redevelop Westlite Mandai by 2026, adding around 3,696 beds.
Over in Malaysia, Centurion plans to conduct an asset enhancement initiative at Westlite Johor Tech Park to add around 870 beds.
It is also exploring a potential PBWA development opportunity at Nusajaya with approximately 7,000 beds.
Tat Seng Packaging (SGX: T12)
Tat Seng Packaging is an industry leader in the delivery of corrugated packaging solutions for a wide range of industries.
Besides Singapore, the group also has operations in China and plants located in Suzhou, Hefei, and Tianjin.
2024 saw the group’s revenue dip by 1.9% year on year to S$253.9 million.
Operating profit fell by 9% year on year to S$22.5 million.
However, net profit stayed flat year on year at S$18.8 million because of a reduced tax expense.
Tat Seng also generated a positive free cash flow of S$25.3 million for 2024.
A higher final dividend of S$0.03 was declared, up from S$0.02 a year ago.
2024’s total dividend came to S$0.06, 33% higher than the S$0.045 paid out a year ago.
The group’s Suzhou subsidiary has invested in a new corrugator, which can produce better quality corrugated products to serve its customers.
This new equipment is equipped with the latest technology to allow Tat Seng to achieve higher productivity, better quality, and garner more energy savings.
However, management warned that the ongoing tariff conflict between the US and China may lead to a slowdown in its business.
Singapore Technologies Engineering (SGX: S63)
Singapore Technologies Engineering, or STE, is an engineering and technology group serving customers in the aerospace, smart city, defence, and public security sectors.
The blue-chip group delivered record revenue and net profit for 2024.
Revenue rose 11.6% year on year to S$11.3 million while operating profit jumped 17.7% year on year to S$1.1 billion.
Net profit climbed nearly 20% year on year to a new record of S$702.3 million.
STE’s return on equity improved to an impressive 26.3% for 2024, up from 23.8% last year.
The engineering giant also upped its final dividend to S$0.05 from S$0.04, taking its 2024 dividend to S$0.17, one cent higher than the previous year.
STE snagged S$12.6 billion of new contracts for 2024, taking its order book to S$28.5 billion as of 31 December 2024.
The group recently held its Investor Day 2025 and announced a progressive dividend plan.
For 2025, STE intends to increase its total dividend to S$0.18.
Henceforth, if the group can achieve steadily higher net profit, management plans to pay out a third of this year-on-year increase as incremental dividends.
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Disclosure: Royston Yang does not own shares in any of the companies mentioned.
