Most of the listed MNCs maintain steady dividend growth trend

Most of the multinational companies (MNCs) listed with the local bourses declared significant amount of cash dividends for the year ended on December 31, 2015, maintaining their profit growth.
Majority of the 13 listed multinational companies that account for 26 per cent of the total market capitalisation of Dhaka Stock Exchange (DSE) as on April 30, 2016 maintained a steady growth trend in dividends.
Of them, 11 firms declared dividends so far for the year ended on December 31, 2015 till date. Five MNCs declared higher dividends, three declared lower dividends, while three declared same dividend in 2015 than the previous year, the DSE data showed.
Seven companies - BATBC, Glaxo SmithKline, Berger Paints, Linde BD, Heidelberg Cement, GP and Singer BD--already held annual general meetings (AGM) recently.
Reckitt Benckiser topped the list in terms of dividend declaration. The company recommended 650 per cent cash dividend for the year ended on December 31, 2015. In 2014, the company disbursed 550 per cent cash dividend.
British American Tobacco Bangladesh (BATBC) and Glaxo SmithKline are the second highest in terms of dividend declarations as the companies' declared 550 per cent cash dividend each for the year ended on December 31, 2015.
Marico Bangladesh recommended 450 per cent cash dividend for the year ended on March 30, 2016. The company disbursed 425 per cent cash dividend last year.
Berger Paints declared 370 per cent cash dividend for the year ended on December 31, 2015. In 2014, the company disbursed 220 per cent cash dividend     Berger Paints has also reported consolidated profits of Tk 1492.77 million with earnings per share (EPS) of Tk 64.37 for in the year ended on December 31, 2015. The company saw profit growth of 29.68 per cent year-on-year in 2015.
"This growth is mainly driven by reduced cost of major raw materials of paints in the international market," Sheltech Brokerage said in an analysis.
Linde Bangladesh, a pioneer in industrial gases in Bangladesh, also declared a total of 310 per cent cash dividend for the year ended on December 31, 2015. In 2014, the company also disbursed 310 per cent cash dividend.
Heidelberg Cement declared 300 per cent cash dividend for the year ended on December 31, 2015. In 2014, the company disbursed 380 per cent cash dividend.
Grameenphone (GP), the largest market cap listed company, declared a total of 140 per cent cash dividend for the year ended on December 31, 2015. The company distributed 160 per cent cash dividend last year.
Singer Bangladesh declared a total of 65 per cent cash dividend for the year ended on December 31, although the company distributed 220 per cent cash dividend last year.
Lafarge Surma Cement recommended a total of 10 per cent cash dividend (5% interim and 5% final) for the year ended on December 31, 215. In, 2014, the cement producer also disbursed 10 per cent cash dividend.
Fu-Wang Ceramic and Fu-Wang Food are yet to declare dividend for the year ended on December 31, 2015.
Market insiders said the MNCs are declaring significant amounts of cash dividends every year after their listing with the local bourses, as brand reputation, better management and product quality helped MNCs to attain significant growth in profits.
"Sharp decline of the commodity price in the international market has significantly helped improve the profit margin and boost operating cash flow of the multinational companies," Md Ashaduzaman Riadh, strategic portfolio manager  of LankaBangla Securities, told the FE.
"As they don't have the major capital expenditure commitment, high free cash flow was paid out as divided in 2015," said Mr Riadh.
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