Mining and oil firms lead dividend jump in first quarter

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Mining and oil firms lead dividend jump in first quarter

LONDON Reuters - Mining and oil firms led a 11% jump in dividends to a first quarter record of $302.5 billion, a report that warned companies faced a growing number of challenges in the months ahead.

The war in Ukraine, geopolitical tensions, high energy and commodity prices, rapid inflation and rising interest rates are all likely to impact companies' dividend prospects, according to British asset management group Janus Henderson.

There is greater uncertainty that will affect corporate decision making because of these challenges. Jane Shoemake, client portfolio manager for global equity income at Janus Henderson said the impact of dividends is likely to be seen beyond 2022, but it is important to remember that dividends are less volatile than profits.

Payouts to shareholders have rebounded after falling during the epidemic.

In the first quarter, all business sectors saw higher dividends year-on- year, with mining and oil companies recording the fastest growth, both of which rose almost a third.

Swiss pharmaceuticals group Novartis and BHP topped the list of the world's biggest dividend payers in the quarter.

The Danish shipping group Maersk was the third largest, having recorded the biggest single dividend increase, as the company benefitted from the disruption in global supply chains, according to the report.

In all, 94% of companies in the index increased or maintained dividend levels, and every region saw double-digit growth.

Payouts have doubled since 2009, when the global dividend index began.