The Covid-19 health crisis has had an impact on dividends worldwide: in 2020, they fell by 12.2%. However, the fall is smaller than expected.
A 12.2% drop in global dividends, weaker than expected
A study published Monday, February 22, 2021 by asset manager Janus Henderson highlights thatin 2020, global dividends reached $ 1.255 billion, a decline of 12.2% from the previous year. A decline due to the health crisis, which forced some companies to give up the payment of dividends in 2020.
The fall remains smaller than expected, as the fourth quarter of 2020 allowed some companies that had suspended dividend payments to reintroduce them partially or in full.
Thus, the report estimates thatone in eight companies around the world (12%) have completely eliminated dividend payments in 2020 and 20% reduced them. Janus Henderson believes that “ The impact of the pandemic on dividends has followed the trend of a classic recession and its impact has been, internationally, less severe than following the global financial crisis (2008) “.
Europe mainly affected by this decline in dividends
While dividends have fallen by 12.2% globally, differences are visible between different parts of the world. So, North America has not seen a fall in dividends but on the contrary an increase of 2.6%. A ” new record »Of $ 546 billion in dividends in 2020, nearly half of the world’s dividends.
Europe is the region of the world which records nearly half of dividend reductions in 2020. France and Spain are notably the countries which have canceled dividend payments the most. Asset manager Janus Henderson predicts in his report a return of dividends “from the month of April” 2021 with a 5% increase in global dividends in 2021. However, the report also predicts a more pessimistic scenario that would lead to a further 2% drop in global dividends in 2021.