Listed firms’ dividends up as economy rebounds

Philippine publicly-listed companies (PLCs) paid 17.3 percent more dividends to stockholders in 2021 as earnings mostly rebounded from the lows seen in the previous year when lockdown measures meant to curb the COVID-19 pandemic were at their tightest.

Based on data collated by the Philippine Stock Exchange (PSE), the amount of cash dividends paid out by all PLCs to common shareholders in 2021 totaled P402.18 billion compared to P342.88 billion in 2020.

This payout translated to an improved average dividend yield of 2.58 percent last year versus 2.5 percent in 2020.

“The gradual reopening of the local economy allowed companies to generate better income, which resulted in bigger dividends for shareholders. We hope that earnings growth among PLCs continues to improve to ensure steady dividend income for stock market investors,” PSE president and CEO Ramon Monzon said in a press statement.

In 2021, 108 of 276 PLCs gave out cash dividends compared with 105 out of 271 in the year before.

The PSE will soon announce a roster of consistently high dividend-yielding companies to guide investors looking for such a theme.

“With around 40 percent of PLCs giving out dividends to their common shareholders, we deemed it necessary to showcase companies that provide high dividend income to investors by coming up with a Dividend Yield Index. This thematic index will be one of the new indices that we will be introducing within the semester,” Monzon added.

Looking only at PSE index companies, 28 out of 30 main index components paid dividends amounting to P157.58 billion, giving common shareholders a 1.72-percent dividend yield.

In 2020, 29 PSEi constituents distributed P157.05 billion in cash dividends, providing a dividend yield of 1.76 percent.

Largest payout

Among the six sectors in the PSE, the financials sub-index, which includes the largest banks, had the largest dividend payout at P187.55 billion.

In 2021, the reopening of the economy and its rebound from the record recession seen in 2020 allowed banks to reduce their loan loss provisions and improve their earnings.

All of the country’s first five real estate investment trusts (REITs) also paid dividends to investors last year, on top of the share appreciation seen by most of these companies since listing.

AREIT Inc., DDMP REIT Inc., Filinvest REIT Corp., RL Commercial REIT Inc. and MREIT Inc. recorded an aggregate cash dividend payout of P5.77 billion, translating to a 2.16 percent dividend yield, even as three of the five REITs were only listed for an average of four months.

“REITs have become a preferred asset class among investors because of its dividend mandate. With more REITs expected to list this year, including nonproperty REITs, investors will have a wider selection of companies that can provide passive income,” Monzon explained.

A REIT is a corporation that primarily invests in income-generating real estate such as office spaces, shopping malls, service apartments, and even hotels, hospitals, warehouses and power plants. It gives investors an opportunity to invest directly in the finished projects rather than the developer itself. INQ