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Four Shares with Consistent Dividend Growth

We’re nearing the end of the earnings season soon. Let’s take a look at some companies that have managed to stretch their record of consecutive annual dividend growth by yet another year after reporting their full-year results.

1. CapitaMalls Asia (SGX: JS8)

The company’s an owner, manager, and developer of retail malls and has business interests in a number of Asian countries that include Singapore, China, Malaysia, Japan, and India. Malls in Singapore like Ion Orchard, Raffles City, West Gate, IMM, JCube etc. are all part of CapitaMalls Asia’s handiwork.

It recently reported its fourth quarter results on 13 Feb 2014 which saw its tenants racking up more sales during the year with more shoppers visiting its malls. Profits after tax and minority interest grew 9% from S$546 million in 2012 to S$600 million in 2013 and along with it, came higher dividends.

The company’s annual dividend increased by 7.7% to S$0.035 per share compared to a year ago and it’s the fourth consecutive year of dividend growth for the company since its initial public offering on the Main Board exchange on 25 Nov 2009.

Year

Dividend per share (Singapore cents)

2009

1.00

2010

2.00

2011

3.00

2012

3.25

2013

3.50

Source: S&P Capital IQ; CapitaMalls Asia’s 2013 earnings release

Shares of the company are currently selling for S$1.79 apiece and are valued at 12 times trailing earnings, with a dividend yield of 2%, which is lower than the Straits Times Index’s (SGX: ^STI) yield of around 2.8%.

2. Super Group (SGX: S10)

The instant beverage maker could fast become known as a food ingredient manufacturer as well. Super Group has two main business segments: Branded Consumer; and Food Ingredients. The first deals with the sale of instant coffee mixes, instant tea, and cereal among others while the latter is involved with the manufacture of other beverage-ingredients (like soluble coffee powder and non-dairy creamer) for sale to third-party beverage makers.

The Food Ingredients segment has been growing really quickly; it made up 35% of Super Group’s total revenue of S$557 million in 2013, a huge jump from a 16.6% share of the company’s total revenue of S$352 million back in 2010.

In the company’s fourth quarter results released on Monday, annual dividends came in at S$0.09 per share, some 27% higher than the dividend of S$0.071 per share paid out in 2012. With Super Group’s earnings per share in 2013 growing by 26% to S$0.179, it seems the company’s not over-reaching to reward its shareholders with growing dividends.

The increase in dividend also helps Super Group achieve its fifth consecutive year of dividend growth

Year

Dividend per share (Singapore cents)

2008

1.6

2009

2.6

2010

5.4

2011

5.8

2012

7.1

2013

9.0

Source: S&P Capital IQ; Super Group’s 2013 earnings release

Super Group’s shares are selling for a trailing price-to-earnings (PE) ratio of 21 at its current price of S$3.70 and fetch a historical dividend yield of 2.4%.

3. Vicom (SGX: V01)

The commercial inspection and testing firm continued its steady-eddy growth path in 2013 as its latest results for the year showed its revenue had increased by 8.1% to S$105 million with profits growing at 7.7% to S$28.4 million, translating into an earnings per share increase of 7.4% to S$0.322.

At the company’s current share price of S$5.82, it’s valued at 18 times trailing earnings and carries a historical dividend yield of 3.9% based on its annual dividend for 2013.

This brings me to Vicom’s dividends. In line with the company’s results, annual dividends of S$0.225 were declared, making it five consecutive years of annual dividend increases for the company.

Year

Dividend per share (Singapore cents)

2008

9.25

2009

11.8

2010

16.1

2011

17.6

2012

18.2

2013

22.5

Source: S&P Capital; Vicom’s earnings releases

4. Raffles Medical Group (SGX: R01)

The healthcare operator’s latest full-year results for 2013 were all about its expansion plans in the years ahead. Raffles Medical would be spending around S$430 million to purchase and develop two pieces of real estate that it had recently purchased.

One plot of land, located just beside its flagship Raffles Hospital at North Bridge Road, Singapore, would be used to expand the premises of the existing hospital. Elsewhere, a 3-storey office building in the Holland Village area in Singapore would be redeveloped into a 5-storey commercial building with medical clinics, retail shops, restaurants and a car park.

But while the company wants to find new paths to growth, its latest results weren’t too shabby either as annual revenue improved by 9.4% to S$341 million with profits growing by 49.1% to S85.3 million.

The growth in profits helped fuel the company’s 11% increase in annual dividend to S$0.05 per share. That also marks the fifth consecutive year where the company has managed to grow its dividend.

Year

Dividend per share (Singapore cents)

2008

2.5

2009

3.0

2010

3.5

2011

4.0

2012

4.5

2013

5.0

Source: S&P Capital IQ; Raffles Medical Group’s earnings release

Shares of the healthcare operator are going for S$3.31 apiece, representing a trailing PE ratio of 22 and a historical dividend yield of 1.5%.

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The information provided is for general information purposes only and is not intended to be personalised investment or financial advice. Motley Fool Singapore writer Chong Ser Jing owns shares in Super Group and Raffles Medical Group.