These ASX dividend shares keep giving investors a pay rise

ASX dividend shares that regularly increase their passive income payments are very attractive because of how they can make us increasingly cash-rich and help offset any inflation effects.

While dividend growth is not guaranteed, I like looking at businesses with a good track record of delivering regular growth because it seems like they’re committed to dividend increases.

Let’s look at two of the most compelling ideas for consistent payout growth.

APA Group (ASX: APA)

APA has the second-longest payout growth streak on the ASX. It has increased its distribution every year for the last 20 years.

It funds its impressive distribution from the cash flow of its portfolio of energy assets across Australia. The most important asset is a network of gas pipelines – the business transports half of the country’s usage.

APA has numerous other assets including gas-powered energy generation, electricity transmission, wind farms, solar farms and gas processing and storage.

Some of the ASX dividend share’s latest announced assets that it’s working on include a new power station in Queensland to help provide firming capacity and more pipelines to supply the southern market.

Energy is a very important element of the Australian economy, so I’d describe APA as having defensive earnings. It’s particularly helpful that a vast majority of APA’s revenue is linked to inflation, giving it earnings protection during times like this.

It’s expecting to increase its distribution to 58 cents per security in FY26, which translates into a distribution yield of 5.7%.

Medibank Private Ltd (ASX: MPL)

Medibank is the leading private health insurer in Australia, with its Medibank and ahm brands, as well as a growing non-insurance division.

That non-insurance segment is becoming a larger contributor to the business – in the FY26 first-half, health insurance operating profit rose 3.5% to $361.5 million and Medibank Health operating profit jumped 28.5% to $48.3 million.

A core driver of the company’s financials is its growing subscriber base, giving it more scale each year.

In the HY26 period, net resident policyholder growth was 38,300 (or 1.9%) and net non-resident policy unit growth was 1,500 (or 0.4%). While that’s not huge growth, it represents ongoing progress for the ASX dividend share and helps justify a dividend increase.

Pleasingly, HY26 group operating profit rose 6% to $381.7 million, though cybercrime impacts continues to be an overhang on the bottom line.

In terms of the dividend, Medibank was able to hike its interim dividend per share by 6.4% to 8.3 cents, representing a dividend payout ratio of 76.8%. Aside from 2020, the business has increased its dividend per share every year since it listed more than a decade ago.

Its latest two dividends equate to a grossed-up dividend yield of 5.7%, including franking credits, at the time of writing.

The post These ASX dividend shares keep giving investors a pay rise appeared first on The Motley Fool Australia.

More reading

• 3 ASX dividend stocks I’d buy if I were a retiree
• Are APA shares a buy after reaching a three-year high?
• 3 top ASX income ideas beyond CBA and the big four banks
• Want to build up a second income? These 2 top ASX shares are a buy
• 3 ASX dividend shares I’d hold through anything

Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has positions in and has recommended Apa Group. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.