Last Year KOSPI Listed Companies' Dividends 28.6 Trillion Won...13.7% Decrease

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[Asia Economy Reporter Kwon Jae-hee] The Korea Exchange announced on the 20th that, after analyzing the cash dividend performance of 779 KOSPI-listed companies with fiscal year ending in December, 556 companies paid a total of 28.6107 trillion KRW in dividends for the 2021 fiscal year.

In particular, the average dividend yield reached the highest level in the past five years at 2.32%.

The number of dividend-paying corporations increased by 5.1% from the previous year (529 companies), but the total dividend amount decreased by 13.7% compared to the previous year (33.1638 trillion KRW).

However, excluding Samsung Electronics, which paid an unusually large dividend through a special dividend in 2020, the total dividend amount was 26.1577 trillion KRW, a 30.5% increase from the previous year (20.0395 trillion KRW).

Samsung Electronics paid 2.453 trillion KRW in dividends last year alone. In 2020, it paid 13.1243 trillion KRW through a special dividend.

The average dividend per company was 51.5 billion KRW, down 17.9% from the previous year, but excluding Samsung Electronics, it increased by 24.2% to 47.1 billion KRW.

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There were 514 companies (92.4%) that paid dividends for two or more consecutive years up to the 2021 fiscal year, an increase of about 3.8% from the previous year (495 companies). Among them, 432 companies (77.7%) paid dividends for five consecutive years.

The average dividend yield (dividend amount relative to current stock price) also rose. Last year, the average dividend yield for common and preferred stocks was 2.32% and 2.65%, respectively, marking the highest levels in the past five years.

This exceeds both the average yield of 1-year government bonds (0.917%) and the interest rate on time deposits (1.190%).

The number of corporations with dividend yields exceeding government bond yields was 444 (79.9%), steadily increasing from 333 in 2019 and 427 in 2020.

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By industry, the highest dividend yields were in telecommunications (3.52%), electric and gas utilities (3.20%), and finance (3.10%). In 2021, as in 2020, all industries recorded dividend yields exceeding government bond yields.

The average payout ratio, which is the ratio of total dividends to net income, was 35.41%, down 4.14 percentage points from the previous year (39.55%).

The Exchange analyzed that "this is because the total net income of dividend-paying corporations increased by about 84.6% compared to the previous year."

The average stock price increase rate of dividend-paying companies in the 2021 fiscal year was 21.81%, exceeding the KOSPI increase rate (3.63%) by about 18.18 percentage points.

In the previous year, the average stock price increase rate of dividend-paying companies was 26.36%, which was below the KOSPI increase rate (30.75%).

The Exchange stated, "The increase in the number of dividend-paying companies reflects strengthened efforts to return profits to shareholders and maintain stable dividend policies. Over the past five years, the average dividend yield has exceeded government bond yields annually, and the number of companies paying consecutive dividends has increased, creating a favorable investment environment for dividend investing."

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