DAX companies: Companies pay record dividends – Mercedes on top

DAX companies: Companies pay record dividends – Mercedes on top

Mercedes Benz is paying about 5.5 billion euros. (sign picture) Photo: imago photo/Arnulf Hettrich

Shareholders of DAX companies can expect record dividends this year. As the consulting firm has calculated, a record amount of 53.8 billion euros will be distributed. But experts warn that this boom is coming to an end.

Despite falling profits, companies in Germany’s top stock market league are paying record amounts to shareholders this year, according to a survey. With a total of 53.8 billion euros, the achievement is greater than ever since the first analysis in 2012, as the consulting firm EY calculated. That is 2.4 percent more than last year. 23 out of 40 DAX companies are increasing their payouts this year.

According to EY, the biggest payer this year is the car manufacturer Mercedes-Benz (5.5 billion euros) – despite a slight decrease in the amount of payments of 0.7 percent. Closely followed by Munich-based insurance group Allianz with an 18 percent increase to 5.4 billion euros. Volkswagen ranks third with 4.5 billion euros. The carmaker has increased the amount of cash paid to its shareholders by three percent. The dividend for the previous financial year is paid after the general meeting.

Porsche increases premiums by 129 percent

Porsche AG shareholders can expect a particularly big increase: According to the study, the carmaker is increasing its payout by 129 percent to 2.1 billion euros. Shareholders of a total of nine companies received less than the previous year, and shareholders of five companies were left empty-handed. Other DAX companies have not changed their distribution policies.

Total dividends rose, even though DAX companies generally earned less last year. According to the news, the consolidated result decreased by six percent to 120.9 billion euros. However, the payout ratio – i.e. the share of dividend payments in total profits – “at 44.5 percent is still below the 5-year average of 47.6 percent and therefore at a stable and acceptable level,” explained EY partner Mathieu Meyer.

How long will the boom last?

The poor economic outlook makes it unclear how long dividend growth will continue, Meyer said. “The economic situation is dire, and economic and political risks are increasing rather than decreasing.” Most DAX companies announced tough austerity plans in light of falling quarterly profits. “If the pressure on profits continues this year, the dividend will probably also be put to the test,” predicted Meyer.

According to EY, the assessment from the beginning of April takes into account, among other things, all invitations to general meetings and dividend announcements of DAX companies.