Time flies, and the end of the year draws near.
2023 was a volatile year marked by investors’ worries over high inflation and soaring interest rates.
Despite this, a crop of companies reported healthy earnings as they deftly navigated the macroeconomic landscape.
Income investors can also rejoice as several businesses have raised their dividends this year.
We highlight five companies that have generously increased their dividend payouts despite a tough 2023.
DBS Group (SGX: D05)
DBS is Singapore’s largest bank by market capitalisation.
The lender benefitted from the surge in interest rates that lifted both its net interest margin (NIM) and net interest income.
For the third quarter of 2023 (3Q 2023), DBS reported a sparkling set of financial numbers.
Total income climbed 16% year on year to a record S$5.2 billion while net profit increased by 18% year on year to S$2.6 billion.
Net profit for the first nine months of the year (9M 2023) jumped 35% year on year to a new high of S$7.9 billion.
For 9M 2023, NIM surged from 1.65% to 2.16%.
DBS declared and paid out a quarterly dividend of S$0.48, a sharp 33% increase from the prior year’s S$0.36.
The bank expects higher for longer rates to sustain its NIM in 2024 with fee income boosted by higher card spending and an increase in wealth management.
Net profit for next year is projected to hover around 2023’s level.
Singtel (SGX: Z74)
Singtel is Singapore’s largest telecommunications company offering a wide range of services including mobile, pay TV, broadband, and cybersecurity.
The group reported a mixed set of earnings for the first half of its fiscal 2024 (1H FY2024) ending 30 September 2023.
Operating revenue dipped by 3.2% year on year to S$7 billion but underlying net profit rose 11.6% year on year to S$1.1 billion.
The telco declared an interim dividend of S$0.052, 13% higher than the S$0.046 paid out last year.
The blue-chip group also revised its dividend policy, upping it to a range of between 70% to 90% of underlying profit compared with the previous range of between 60% to 80%.
Singtel’s Australian unit, Optus, recently secured a spectrum win in a government spectrum auction that will provide better 5G network coverage in north New South Wales and South QLD, including the Gold Coast.
The four licences will be valid for 20 years and will commence in 2024.
Elsewhere, Singtel also secured its first green loan of S$535 million.
This is a five-year loan issued by a consortium of banks including DBS, OCBC (SGX: O39), Standard Chartered Bank (LON: STAN) and United Overseas Bank (SGX: U11).
Civmec Limited (SGX: P9D)
Civmec is an integrated construction and engineering services provider headquartered in Australia that provides a range of services to the energy, infrastructure, and resources sectors.
For its fiscal 2023 (FY2023) ending 30 June 2023, the group reported a 2.7% year-on-year increase in revenue accompanied by a 13.7% year-on-year increase in net profit.
The engineering group raised its final dividend by 50% year on year from A$0.02 to A$0.03.
Civmec recently released its first quarter fiscal 2024 (1Q FY2024) business update.
Revenue continued its climb, rising 7.3% year on year to A$245.1 million.
Net profit also improved by a similar quantum to A$15.2 million.
Civmec’s operating cash generation more than quadrupled year on year in 1Q FY2024 to A$40.1 million.
In addition, its order book jumped close to 18% year on year to A$1.1 billion.
Singapore Exchange Limited (SGX: S68)
Singapore Exchange Limited, or SGX, is Singapore’s sole stock exchange operator.
The bourse operator reported a strong set of earnings for FY2023 with revenue rising 8.7% year on year to S$1.2 billion.
Underlying net profit was up 10.3% year on year to S$503.2 million.
The group raised its quarterly dividend from S$0.08 to S$0.085, increasing its annual dividend from S$0.32 to S$0.34.
There could be more to come with SGX aiming to grow into a multi-asset hub within Asia.
Management has communicated its intention to increase dividend per share by a mid-single-digit percentage annually (subject to earnings growth).
SGX recently collaborated with the Shanghai Stock Exchange (SSE) to debut its first pair of exchange-traded funds (ETFs) to provide investors with access to large-cap companies on SSE along with the ability to tap into the growth potential of the technology sector in Southeast Asia and India.
Haw Par Corporation Limited (SGX: H02)
Haw Par is a conglomerate with four core divisions – healthcare, leisure, property, and investments.
The group is the owner of the famous Tiger Balm brand of salves and ointments.
Haw Par released a strong set of earnings for the first half of 2023 (1H 2023).
Revenue rose 16.3% year on year to S$111.1 million while net profit surged nearly 35% year on year to S$104.1 million.
In particular, its healthcare division led by Tiger Balm saw revenue rise 17.2% year on year to S$101.8 million.
Segment profit soared nearly 64% year on year to S$29.1 million.
Haw Par raised its interim dividend from S$0.15 last year to S$0.20 in 1H 2023.
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Disclosure: Royston Yang owns shares of DBS Group and Singapore Exchange Limited.
