Global dividend payouts climb 10 per cent to reach record heights in first quarter

Booming corporate profits have pushed global dividends to record heights in the first quarter, according to the Janus Henderson Global Dividend index.

Dividends jumped up 10.2 per cent on a headline basis to $244.7bn in the first few months of 2018 – setting a new record for first quarter payouts.

The index, which is being released today, ended the quarter at a record 174.2, meaning that global payouts were nearly three-quarters higher than in 2009.

The London investment firm added that quarter one exceeded expectations thanks to a weaker dollar, as underlying growth of 5.9 per cent met forecasts.

Janus Henderson said it now expected dividends to rise 8.5 per cent for the full year, reaching a total of $1.36 trillion, $10bn more than predicted at the start of the year.

In the UK, dividends reversed a decrease in payouts in 2017 to rise 21.1 per cent to $18.7bn (£13.8bn), although this was distorted by a large timing change from tobacco giant BAT, which moved to quarterly distributions.

Read more: Global dividends hit record highs – but it might not be good news

Ben Lofthouse, director of global equity income at Janus Henderson said:

2018 has started well for dividends. Economic growth is strong, and corporate profitability is rising, generating cash that companies can return to their shareholders. The quarter one acceleration in US dividend growth may be an early sign that companies are feeling confident about returning some of the cash they have accumulated to shareholders.

The second quarter is seasonally important for European dividend payments and we will see a much broader range of industries and countries contributing than in quarter one. Europe’s economic recovery is likely to yield healthy growth from across the region.

We’re confident investors will get to celebrate a new record for global dividends in 2018.