Company Nigeria paid over N958 billion in dividends in 2020 in keeping with knowledge from the annual studies of the businesses. This determine topped the N851.9 billion paid in 2019 by the identical firms below assessment.
The information was obtained from monetary statements of 34 of a few of the most capitalized firms on the Nigerian Inventory Alternate who reported dividends paid out of their money move statements. The report targeted on dividends paid out somewhat than what was declared by listed firms.
The upper dividends paid throughout the yr signify a 13% enhance from the yr earlier than suggesting that corporates saved their commitments to return money to their shareholders regardless of a precarious yr that was marred by the Covid-19 pandemic.
On the top of the pandemic in March 2020, some firms like Julius Berger reduce on dividend funds, as an alternative of pushing for bonus points together with dividends. From our estimates, out of the 166 listed entities, a report 9 declared bonus points throughout the yr in comparison with simply three in 2019 and 2018. A lot of the firms that opted for script points had been insurance coverage corporations as they confronted a recapitalization mandate by the Nationwide Insurance coverage Fee.
Greenback adjusted dividends – Regardless of the 13% enhance in dividend payout yr on yr, the determine is flat compared to 2019 when adjusted for alternate charge devaluation. At an alternate charge of N410/$1, the N958 billion paid adjusts to $2.33 billion whereas the N852 billion paid in 2019 adjusts to $2.36 billion at an alternate charge of N360/$1.
High dividend payers – The highest ten dividend payers made up over 87% of the dividends paid throughout the yr buttressing the dominance of some mega-corporations in Nigeria’s enterprise and financial panorama.
- As anticipated, Dangote Cement topped as the best paying dividend firm in Nigeria returning N272 billion to its shareholders in 2020 seemingly unchanged from 2019. Subsequent in line was MTN with N172 billion paid out in 2020. MTN’s dividend grew by 29.5% yr on yr.
- Zenith and GTBank had been the best paying banks with every paying N87.9 billion and N83 billion respectively dwarfing the likes of UBA and First Financial institution who paid N33 billion and N14.2 billion respectively.
Development in dividends – Cement big, BUA reported a whopping 1000% in dividends largely as a result of consolidation of the group’s cement companies throughout the nation. BUA Cement paid out N59.2 billion in dividends within the yr. Union Financial institution additionally recorded over 1,400% enhance in dividends paying out over N7 billion in 2020. It skipped dividend funds in 2019 apart from minority shareholders.
What to anticipate in 2021: Nairametrics expects dividend funds in 2021 to high what was paid in 2020 as firms get well from the challenges of Covid-19. Company income had been a lot greater throughout the yr regardless of pandemic challenges, whereas the money reserves of the mega-corporations had been hardly impacted.
The newest earnings season buttresses our expectations as we’ve already seen a major enhance in dividend payout of a few of the mega-corporations. The ultimate dividends of many of the firms which have introduced dividends topped what was proposed in the identical interval final yr. For instance, 2021 (2020) Entry 55 kobo (40 kobo), GTB N2.7 (N2.5), BUA N2.07 (N1.75), MTN N5.9 (N4.97), and so forth.