Not every business suffered during the pandemic.
For instance, the financial, technology and healthcare industries remained relatively unscathed and even thrived as the world recognised the urgency to digitalise.
And if you are a dividend-focused investor, there’s good news for you.
Businesses that performed well during this downturn have rewarded shareholders with higher dividend payments.
Here are three companies that managed to raise their year on year dividends despite the tough conditions.
Singapore Exchange Limited (SGX: S68)
Singapore Exchange Limited, or SGX, is Singapore’s sole stock exchange operator.
The group’s platform allows for the buying and selling of a comprehensive range of securities such as equities, bonds and derivatives.
SGX has continued to report strong financial results as its business remained unaffected by the pandemic.
For its fiscal 2021 half-year (1H2021) ended 31 December 2020, the group reported a 9% year on year increase in revenue to S$521 million.
Net profit climbed 12% year on year to S$240 million, and the bourse operator raised its interim quarterly dividend from S$0.075 to S$0.08.
At the current share price of S$11.76, shares of SGX offer a prospective 2.7% dividend yield.
There could be more to come.
SGX had just announced the acquisition of MaxxTrader, a provider of foreign exchange pricing and risk solutions for sell-side clients, for US$125 million.
The transaction will add to SGX’s earnings per share from the first year (excluding one-off transaction costs).
The bourse operator had also detailed its ambition to take its business to the next level during its recent Analyst Day.
Should growth pan out for SGX, the group may enjoy a further boost in its earnings and could also raise its dividends.
Full-year 2021 earnings are slated for release on 5 August.
iFAST Corporation Limited (SGX: AIY)
iFAST is a financial technology company that operates a platform for the buying and selling of unit trusts, equities and bonds.
The group enjoyed a strong 2020 due to the strong inflow of client assets of S$3.2 billion.
Revenue for the full year jumped by 31.7% year on year to S$85.9 million while net profit more than doubled from S$11.1 million to S$25.4 million.
The dividend per share increased from S$0.0315 in 2019 to S$0.033 in 2020.
The momentum has carried forward into 2021.
iFAST recently announced a stellar set of financials for its fiscal 2021 first half (1H2021).
For the half-year, net revenue surged by 41.4% year on year while net profit soared by 94% year on year to S$15.8 million.
The group’s assets under administration (AUA) hit a new record-high of S$17.54 billion as of 30 June 2021.
In line with the good results, iFAST hiked its second interim dividend to S$0.011, up 46.7% year on year from the S$0.0075 in the same period last year.
If iFAST’s net profit continues to climb, the group could continue to raise its dividend for the remainder of the fiscal year.
Top Glove Corporation Berhad (SGX: BVA)
Top Glove is the world’s largest manufacturer of gloves with a current glove production capacity of 100 billion pieces per annum.
The group employs 22,000 employees, has over 2,000 customers worldwide and exports its products to more than 195 countries.
The outbreak of the pandemic has led to a strong surge in demand for nitrile gloves used by hospitals and healthcare institutions.
For the first nine months of its fiscal 2021 ended 31 May 2021, Top Glove reported a more than tripling of its revenue from RM 4.1 billion to RM 14.3 billion.
Operating profit surged 13-fold from RM 720.8 million to RM 9.4 billion, while net profit jumped 12-fold to RM 7.3 billion.
For the group’s fiscal 2021 first half, it has already paid out a total dividend of RM 0.417, significantly higher than fiscal 2020’s full-year dividend of RM 0.1183.
During the third quarter, Top Glove declared a total dividend of RM 0.18, bringing nine-month dividends to RM 0.597.
Expansion plans are underway to increase the group’s glove production capacity from the current 100 billion to 205 billion by the end of 2024.
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Disclaimer: Royston Yang owns shares of Singapore Exchange Limited and iFAST Corporation Limited.
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