Monday 18 November 2019 12:01 am

Dividend growth slows in third quarter as profit slowdown bites

Dividend growth has slowed globally, according to figures published today by asset manager Janus Henderson.

The trend began in the second quarter and continued into the third.

Dividends have still continued to grow, but at a slower pace than previously.

Payouts rose 2.8 per cent on a headline basis to reach a third-quarter record of $355.3bn (£275bn).

Read more: Which stocks are in the dividend danger-zone?

On an underlying basis, dividends grew 5.3 per cent.

UK dividend growth remained lacklustre, with underlying growth of 0.6 per cent.

US dividends grew eight per cent on an underlying basis, but a slowdown in profit growth began to make its effect felt.

One-in-six US companies held their dividends flat in the third quarter, up from one-in-10 in the first quarter.

The largest dividend payer in the US this year is set to be AT&T, jumping ahead of Apple, Exxon Mobil and Microsoft.

Read more: Shell changes tack in expected dividend hike

AT&T returns to the top spot for the first time since 2012, thanks to its acquisition of Time Warner in 2018.

The combined company will distribute close to $14.9bn, although not be enough to dislodge Shell as the world’s largest dividend payer for the fourth year in a row.

Janus Henderson has left its $1.43 trillion forecast for global dividends unchanged for 2019.

This represents a headline increase of 3.9 per cent, equivalent to underlying growth of 5.4 per cent. In 2018 underlying growth was 8.5 per cent.

This year will mark the tenth consecutive year of underlying growth for dividends.