Company Nigeria paid over N958 billion in dividends in 2020 in keeping with knowledge from the annual stories of the businesses. This determine topped the N851.9 billion paid in 2019 by the identical firms below evaluate.
The info was obtained from monetary statements of 34 of a few of the most capitalized firms on the Nigerian Inventory Change who reported dividends paid out of their money move statements. The report targeted on dividends paid out fairly than what was declared by listed firms.
The upper dividends paid through the yr signify a 13% improve 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 a substitute of pushing for bonus points together with dividends. From our estimates, out of the 166 listed entities, a report 9 declared bonus points through the yr in comparison with simply three in 2019 and 2018. Many 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% improve in dividend payout yr on yr, the determine is flat compared to 2019 when adjusted for trade fee devaluation. At an trade fee 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 trade fee of N360/$1.
High dividend payers – The highest ten dividend payers made up over 87% of the dividends paid through the yr buttressing the dominance of some mega-corporations in Nigeria’s enterprise and financial panorama.
- As anticipated, Dangote Cement topped as the very 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 very 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.
Progress in dividends – Cement large, BUA reported a whopping 1000% in dividends largely because of the 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% improve in dividends paying out over N7 billion in 2020. It skipped dividend funds in 2019 aside from minority shareholders.
What to anticipate in 2021: Nairametrics expects dividend funds in 2021 to high what was paid in 2020 as firms recuperate from the challenges of Covid-19. Company income had been a lot greater through the yr regardless of pandemic challenges, whereas the money reserves of the mega-corporations had been hardly impacted.
The most recent earnings season buttresses our expectations as we now have already seen a major improve in dividend payout of a few of the mega-corporations. The ultimate dividends of a lot 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 many others.