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Global dividends boom in Q1 but growth is set to slow – Janus Henderson forecast upgraded

  • Global dividends jumped 12.0% on a headline basis to a Q1 record of $326.7bn – boosted by the largest contribution from special dividends in nine years
  • Underlying growth was 3.0%
  • Globally, 95% of companies raised dividends or held them steady in Q1
  • Banks, oil producers and vehicle manufacturers were significant drivers of Q1 growth, though most sectors delivered increases
  • Lower mining dividends caused a significant drag on growth
  • A strong Q1 and an expected positive Q2 in Europe, bring an upgrade to Janus Henderson’s 2023 forecast to $1.64 trillion, up +5.2% on a headline basis, equivalent to +5.0% underlying

Embargoed until 00:01AM Wednesday 24th May – Global dividends made a strong start to 2023 on the back of booming special dividends, according to the latest Janus Henderson Global Dividend Index. The headline total rose 12.0% to a first-quarter record of $326.7bn. Underlying growth, which strips out special dividends, exchange rate effects and other technical factors, was significantly slower at 3.0%.

One-off special dividends at highest level since 2014

One-off special dividends of $28.8bn were the second highest on record (after Q1 2014). Ford and Volkswagen accounted for almost a third of the world’s Q1 special dividends. Headline payouts from the vehicles sector were ten times larger year-on-year as a consequence. One-off special dividends also made a significant impact in the transport, oil and software sectors.

US payouts reached a new record

The highly seasonal nature of dividends in most parts of the world means the first quarter is dominated by the United States, where payouts are spread more evenly through the year. Dividend growth here has been progressively slowing in recent quarters and dropped to 4.8% on an underlying basis in Q1. Headline growth was 8.3% once generous one-off special dividends were included, taking the US total to a record $153.4bn. A seasonal bias towards slower-growing Switzerland also helped bring the Q1 growth rate down as did weakness in Australia and emerging markets thanks to lower mining dividends.

Growth from banks and oil companies offset by falling mining dividends

The sharp decline in mining sector payouts, driven down one fifth by lower commodity prices, was almost exactly offset in Q1 by the strong positive contribution to growth from banks and oil companies. Most sectors delivered single-digit growth and there were relatively few weak spots. Globally, 95% of companies either raised dividends or held them steady in Q1.

Strong Q1 and positive Q2 expected in Europe mean upgrade to Janus Henderson’s forecast

For the rest of 2023, falling mining payouts will continue to act as a significant drag on growth, affecting Australia, emerging markets, and the UK in particular. But payouts from the banking and oil sectors continue to deliver. Moreover, the picture across Europe is much more encouraging than seemed likely three months ago, as 2022’s robust profit performance is reflected in higher dividend payments. The boom in special dividends reported in the first quarter is also contributing to a higher-than-expected headline total for the year.

Janus Henderson now expects total dividends for 2023 of $1.64 trillion[1], equivalent to a headline increase of 5.2% for the year and underlying growth of 5.0%[2].

Ben Lofthouse, head of global equity income at Janus Henderson said: “Q1’s strong dividend growth is all the more impressive considering that 2022 was a difficult year for the global economy with high inflation, rising interest rates, conflict and continuing Covid lock downs. This growth illustrates the fact that dividends are generally less volatile than earnings. We do expect dividend growth to slow as a result of these factors but should nevertheless continue in line with the long-term trend this year.”


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Notes to editors
Our headline growth rate describes the change in the total dollar amount paid by companies compared to the corresponding quarter each year. Our underlying figure adjusts for the distortion that can be caused by one-off special dividends, changing exchange rates, the effect of companies entering and leaving the global top 1,200 that comprise our index and the impact of changes in payment dates. The latter two tend to be negligible over the course of a whole year at the global level, though they can have a greater impact in any one quarter, geography or sector.

About Janus Henderson

Janus Henderson Group is a leading global active asset manager dedicated to helping investors achieve long-term financial goals through a broad range of investment solutions, including equities, fixed income, multi-asset, and alternative asset class strategies.

At 31 March 2023, Janus Henderson had approximately US$311 billion in assets under management, more than 2,000 employees, and offices in 24 cities worldwide. Headquartered in London, the company is listed on the NYSE and the ASX.

[1] Up from $1.60 trillion in January

[2] Up from 3.4% in January