There are a handful of ASX dividend shares that have a record of growing dividends for shareholders and have the intention of continuing to grow the payments.
COVID saw lots of dividend cuts for some of the ASX’s most popular income payers like Commonwealth Bank of Australia (ASX: CBA), Transurban Group (ASX: TCL) and Sydney Airport.
These two businesses are ones with growing dividends:
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
Soul Pattinson has the longest-running dividend growth record on the ASX. It has grown its dividend every year since 2000. No other business has a record like that, though there are some which haven’t cut the dividend for decades, they just haven’t increased the dividend like this ASX dividend share has.
It’s an investment conglomerate that owns a large and diversified portfolio of ASX blue chips, as well as some core holdings where it has substantial ownership. Its ‘strategic portfolio’ includes: TPG Telecom Ltd (ASX: TPG), Brickworks Limited (ASX: BKW), New Hope Corporation Limited (ASX: NHC), Tuas Ltd (ASX: TUA), Pengana Capital Ltd (ASX: PCG) and Apex Healthcare.
The ASX dividend share also has a private equity portfolio which includes things like agriculture, resources, swimming schools and electrical parts. With this, it’s looking for established businesses with sector tailwinds that provide a strong platform for growth.
For new opportunities, it is looking at themes like the energy transition, financial services, health and ageing, food and agriculture, and education.
Soul Pattinson says that its investment strategies have delivered above market returns for decades. It also aims for “steady and growing dividends.”
It has a trailing grossed-up dividend yield of 3.5%.
Sonic Healthcare Ltd (ASX: SHL)
Sonic has been one of the performers in the healthcare sector over the last two years.
Its pathology services were put to use with all of the COVID-19 PCR testing that was carried out in places like Australia, the USA, Germany and the UK.
Growth continued in the first half of FY22 with overall revenue growth of 7% to $4.8 billion, earnings before interest, tax, depreciation and amortisation (EBITDA) growth of 18% to $1.5 billion and 22% growth of net profit to $828 million.
Excluding COVID testing, HY22 base revenue was up 4.3%. Management are expecting ongoing growth of the base business, with strong underlying drivers including a catch-up of testing that was postponed through the pandemic.
Sonic is expecting a sustainable level of COVID testing into the future, including routine COVID testing, screening programs, variant testing, antibody testing and so on.
The ASX dividend share spent $585 million on acquisitions in the first half, including ProPath and Canberra Imaging Group. There is also an active pipeline of opportunities under evaluation.
It has launched a share buy-back of up to $500 million with an intention to move towards long-term average gearing through acquisitions and this buy-back.
Sonic maintains a progressive dividend policy. The interim dividend was grown by 11% to $0.40. Its dividend has been growing for approximately a decade.
The pre-franking trailing dividend yield of Sonic is 2.7%.
The post 2 ASX shares that could keep growing the dividend every year appeared first on The Motley Fool Australia.
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More reading
- Opportunity? 5 ASX 200 shares that traded at 52-week lows today
- Record financials not enough: Sonic Healthcare (ASX:SHL) share price sinks post-earnings
- The ASX 200 is awash with 52-week lows on Friday. Here are some of the biggest names growing smaller
- While everyone was focused on growth shares, these ASX value shares have been quietly but significantly gaining over the last 10 years
- This expert says now is the time to buy ASX dividend shares. Here’s why
Motley Fool contributor Tristan Harrison owns Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia owns and has recommended Brickworks and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Sonic Healthcare Limited and TPG Telecom Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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