Om du letar efter utdelningstillväxt till ett rimligt pris, är en av de bästa ställena att börja utdelningsaristokraterna.
Förlåt. Vi menar inte de Utdelningsaristokrater. Vi menar deras grannar på andra sidan dammen:European Dividend Aristocrats.
European Dividend Aristocrats, som namnet antyder, är en samling europeiska utdelningsaktier som är erkända för sina stadiga och växande utbetalningar. Och denna delmängd av S&P Europe 350 Index tenderar att sticka ut mycket mer än sina amerikanska motsvarigheter, eftersom konsekvent stigande utdelningar är mycket mer ovanliga i Europa.
Det finns skillnader såklart. S&P 500 Dividend Aristocrats måste leverera minst 25 årliga utdelningsökningar i följd. Däremot behöver europeiska utdelningsaristokrater bara visa 10 år av stabil eller ökande utdelningar.
För den 10-årsperiod som slutade 2020 hade European Dividend Aristocrats genererat en årlig totalavkastning på 12,5 %, en respektabel prestation jämfört med 10 % avkastning från jämförelseindexet för euroområdet och 13,5 % avkastning för amerikanska aristokrater. Men ännu viktigare, för värdesökare – European Dividend Aristocrats handlar för ett genomsnittligt P/E på mindre än 16 för tillfället, jämfört med mer än 19 för de amerikanska aristokraterna.
Läs vidare för att utforska alla 39 europeiska utdelningsaristokrater. Om du funderar på att investera i någon av följande internationella utdelningsaktier, notera att alla aktier här har USA-noterade aktier, men de är inte alla lika. Vissa har notering på de stora börserna i USA. Andra handlas "over-the-counter" men har fortfarande hög daglig volym, vilket innebär att du sannolikt kommer att köpa och sälja nära det pris du ser noterat. Men ett fåtal har mycket tunt omsatt OTC-aktier; om du köper dem, använd limitordrar för att säkerställa att du kommer in till det pris du faktiskt vill ha.
Belgiens UCB (UCBJF, $96,43) är ett biofarmaceutiskt företag specialiserat på behandlingar av neurologiska och immunologiska sjukdomar. UCB:s mest kända läkemedel inkluderar Cimzia (autoimmun sjukdom och inflammatorisk sjukdom), Vimpat, Keppra och Briviact (epilepsi) och Neupro (Parkinsons sjukdom). Läkemedel i sent utvecklingsstadium inkluderar bimekizumab (psoriasis) och dapirolizumab pegol och Staccato alprazolam (epileptiska anfall).
Företaget utökar sin pipeline via förvärv; 2020 inkluderade det avslutande köpen av Ra Pharma och Engage Therapeutics. Ra Pharma utökar UCB:s ledarskap inom behandlingar av myasthenia gravis, och Engage tillhandahåller ett nytt epilepsiläkemedel.
Ett starkt resultat från UCB:s läkemedelsportfölj ledde till en försäljningsökning på 9 % och en tillväxt på 3 % av kärnvinsten per aktie under 2021. Företaget är vägledande för 2021 års vinst per aktie som sträcker sig från 5,60 euro till 6,10 euro, en ökning med 12,5 % jämfört med föregående år i mitten.
Företaget räknar med att nå toppförsäljning för Vimpat 2022, Cimzia 2024 och Briviact 2026. En utökad försäljning av nyare läkemedel ger gott om landningsbana för den totala försäljningstillväxten.
UCB är bland de nyaste europeiska utdelningsaristokraterna. Det har betalat utdelning sedan 2006 och har stadigt höjt sin utbetalning sedan 2010, inklusive en ökning med 2,5 % under 2020.
Givaudan (GVDNY, $79,15) är en schweizisk tillverkare och marknadsförare av dofter och personliga hygienprodukter samt smakämnen, drycker och livsmedel. Den har marknadsledande andel av fina dofter.
Företaget marknadsför cirka 122 600 olika produkter och är fortsatt starkt fokuserat på att utöka sin produktlinje via FoU, som pågår vid 69 forskningscentra världen över. Givaudan har redan 3 600 aktiva patent. Försäljningen sker över hela världen. Företaget genererar 58 % av sin försäljning i utvecklade länder och 42 % av försäljningen från tillväxtmarknader.
Trots pandemin levererade Givaudan ett starkt resultat för 2020, med en försäljning som ökade med 4 % och EBITDA ökade med 10 %. Genereringen av fritt kassaflöde var utmärkt med 12,8 % av försäljningen. Under de senaste fem åren har företaget genererat nästan 5 % årlig försäljningstillväxt och fritt kassaflöde på i genomsnitt 12,6 % av försäljningen.
Givaudan siktar på en organisk försäljningstillväxt på 4% till 5% årligen, vilket man siktar på att uppnå genom att utöka sin produktportfölj till nya områden som näring, livsmedelsingredienser och skönhet och utnyttja sitt marknadsledarskap i Kina.
Givaudans utdelning har ökat varje år sedan 2009, med en årlig tillväxt på över 3,5 % årligen under de senaste fem åren. Det inkluderar en förbättring på 3,2 % under 2020. Tack vare sin utmärkta generering av fria kassaflöden är Givaudan bekväm med en relativt hög utbetalning på 80 % från intäkter.
Swiss RE (SSREY, 25,22 USD) är en ledande världsomspännande grossist inom återförsäkring och försäkring. Företaget säljer direkt och via mäklare till cirka 2 300 kunder över hela världen, inklusive försäkringsbolag, medelstora till stora företag och statliga myndigheter. Det verkar genom 80 kontor globalt som marknadsför egendoms- och olycksfallsåterförsäkring, liv- och hälsoåterförsäkring och blandade lösningar för företagskunder.
Inom segmentet Property &Casualty arbetar Swiss RE med att utöka emissionsmarginalerna för att kompensera för lägre räntor. Bolaget siktar på en totalkostnadsprocent på 96 % 2021. Inom Life &Health-verksamheten är dess fokus att generera nya affärer, särskilt i Asien, och att lägga en grund för framtida vinsttillväxt. Bolagets nya digitala försäkringsplattform, iptiQ, bidrar till detta arbete. IptiQ har redan säkrat 40 distributionspartners, 500 000 kunder och över 300 miljoner USD i bruttopremier.
Även om covid-påverkan gjorde att schweiziska RE noterade en nettoförlust under 2020, började företaget återgå till lönsam tillväxt från och med septemberkvartalet. Swiss Re rapporterade en förlust på 878 miljoner USD för helåret; För att backa ut covid-19-relaterade anspråk och reserver var nettovinsten 2,2 miljarder dollar, vilket var betydligt högre än 2019:s 727 miljoner dollar. Och under septemberkvartalet avslutade företaget en företagsförsäljning som resulterade i en utdelning på 1,5 miljarder USD till Swiss Re.
Den här europeiska utdelningsaristokraten har betalat årlig utdelning sedan 1994 och ökat sin utdelning med 5 % 2020 efter att ha ökat den med 12 % 2019.
Partnersgrupp (PGPHF, 1 365,00 USD) är ett schweiziskt private equity-bolag som betjänar cirka 900 institutionella kunder och förvaltar tillgångar på cirka 109 miljarder USD. Företaget investerar i privata lån, fastigheter, infrastruktur och aktier i en mängd olika geografier och branscher. Det investerar huvudsakligen i icke-cykliska industri-, hälso- och läkemedelsoutsourcingföretag.
Som en private equity-investerare rankas Partners Group i toppskiktet av globala buyout-chefer.
Bolagets förvaltade tillgångar har ökat varje år sedan dess börsintroduktion 2006 (IPO). Under 2020 ökade Partner Groups förvaltade tillgångar med 11 % och 16 miljarder USD i nya kundmedel flödade in i företaget. Företaget räknar med att 2021 års inflöden kommer att variera från 16 miljarder dollar till 20 miljarder dollar och förväntar sig att den gradvisa lättnaden av covid-relaterade osäkerheter kommer att öka efterfrågan på private equity-marknaden.
Partner Group rapporterade en minskning med 12 % i intäkter under 2020. Det var främst ett resultat av sjunkande prestationsavgifter, som påverkades kraftigt av covid-19, även om förvaltningsavgifterna faktiskt förbättrades med 1 %. Allt som allt upplevde företaget en vinstminskning på cirka 11 %.
Partner Groups utdelning har stigit varje år sedan 2008, med tillväxt under det senaste decenniet som översteg 20 % årligen.
Experian (EXPGY, $35,03) är ett irländskt-amerikanskt företag som specialiserar sig på konsumentkrediter. Företaget har kreditinformation om cirka 220 miljoner amerikanska konsumenter och 40 miljoner amerikanska företag. Experian får 63 % av intäkterna från Nordamerika, 15 % från Storbritannien och Irland, 14 % från Latinamerika och 8 % från Asien och Stillahavsområdet.
Företaget grundades som en kreditinformationskälla för långivare och konsumenter, men har sedan dess utökat sin kundbas till att omfatta telekom, statliga myndigheter, bilhandlare, sjukhus och andra industrier.
Experian ökade intäkterna med 9 % och EBIT 5 % under räkenskapsåret 2020 och har fått en bra start under räkenskapsåret 2021 trots pandemin. Intäkterna översteg guidningen och ökade med 9 % under decemberkvartalet, tack vare bidrag från företagets nordamerikanska och asiatiska verksamhet. Ledningen förutspår 2021 EBIT (vinst före räntor och skatter) som sträcker sig från 1,35 miljarder USD till 1,38 miljarder USD, ungefär oförändrad med EBIT på 1,39 miljarder USD som producerades förra året.
Experian höjde sin utdelning med 1 % 2020. I år tillkännagav de en interimsutdelning på 15 cent som skulle betalas ut i februari 2021, vilket motsvarar den interimsutdelning som betalades förra året.
Hexagon AB (HXGBY, $95,54) tillhandahåller högteknologiska verktyg för geospatial kartläggning och industriella tillämpningar.
Tjänster tillhandahålls inom två segment; Industrial Enterprise Solutions Group bygger system som ger exakta mätningar som behövs för datorstödd design, tillverkning och ingenjörskonst. Segmentet Geospatial Enterprise Solutions bygger system som fångar data från land och luft, positionerar satelliter och genererar 3D-kartor och modeller. Företaget har sitt huvudkontor i Sverige och betjänar kunder i 160 länder.
Lantmäteri är Hexagons enskilt största verksamhet och står för ungefär 20 % av försäljningen.
Även om Hexagons försäljning och resultat minskade under 2020, uppnådde företaget rekordresultat för december kvartalet och förbättrade sitt kassaflöde. Kina och geospatiala tjänster var kvartalets primära tillväxtfaktorer och levererade 25 % respektive 7 % organisk tillväxt. Hexagon ser att efterfrågan från sitt industrisegment ska återgå till normaliserade nivåer 2021.
Bolaget ökade sin utdelning med 5 % under 2020 och föreslog också en aktiesplit 7-för-1. Hexagon har levererat en årlig utdelningstillväxt på nästan 14 % under fem år.
FrankrikesHermès International (HESAY, $113,18) är en ledande leverantör av lyxtillbehör och lädervaror, som säljs genom sitt nätverk av 311 boutiquebutiker i 45 länder. Grundades som sadelmakare för över 180 år sedan, Hermès International har utvecklats till ett förstklassigt lyxvarumärke som genererar det mesta av sin försäljning i Europa, Asien och USA
Efter en svår start på 2020 orsakad av covid-relaterade nedstängningar, Hermès International återgick till tillväxt under septemberkvartalet, med försäljningen ökade med 7% till följd av stark kundtrafik i koncernens butiker, fart i Asien och generellt förbättrade förhållanden i Europa och USA. För helåret minskade intäkterna med 6%.
Investeringsanalysföretaget UBS berättade nyligen för sina kunder att lyxvarumärken som Hermes ökar marknadsandelar i Kina och rankade HESAY som ett toppval inom lyxvarubranschen.
Bolaget höll sin utdelning på €4,55 per aktie stabil förra året på grund av covid. Tidigare har utdelningstillväxten i genomsnitt varit nästan 11 % per år. Som några andra europeiska utdelningsaristokrater, Hermès ger också ibland särskild utdelning.
ABB (ABB, 31,21 USD) tillverkar instrument som används inom elektrifiering, industriell automation, rörelse- och robotapplikationer och betjänar kunder inom allmännyttiga, industri-, transport- och infrastrukturindustrin. Detta schweiziska företag tillhandahåller infrastruktur för laddningsstationer för elfordon, solenergiuppvärmning, automatiserad distribution och andra högteknologiska tillämpningar.
ABB innehar marknadsandelarna nr 1, 2 eller 3 på de flesta av sina marknader och räknar Siemens (SIEGY), Emerson Electric (EMR), Honeywell (HON), Rockwell Automation (ROK) och General Electric (GE) till sina lång- stående kunder.
Trender som driver ABB:s långsiktiga tillväxt inkluderar efterfrågan på el som ökar dubbelt så snabbt som andra energikällor, ökad automatisering och tillverkningstillämpningar för artificiell intelligens.
ABB drabbades av en intäktsminskning på 6 % under 2020 på grund av covid-relaterade industriella nedläggningar, men den grundläggande vinsten per aktie steg med 261 % tack vare en vinst på 5,3 miljarder USD på försäljningen bokad på företagets Power Grids-verksamhet. ABB planerar att återföra 7,6 miljarder dollar i kontanta intäkter från försäljningen till investerare, inklusive via ett nytt program för återköp av aktier på 4,3 miljarder dollar.
I år planerar ABB att helt decentralisera sin affärsverksamhet, vilket borde ge 500 miljoner USD i årliga kostnadsbesparingar.
Bolaget lämnar årlig utdelning. Även om betalningarna inte har ökat varje år, har utdelningarna mer än tredubblats under en 14-årig tidsram.
Storbritannien-baserade Ashtead Group (ASHTY, $249,75) driver en global uthyrningsverksamhet för utrustning med platser över hela USA, Storbritannien och Kanada, främst under namnet Sunbelt Rentals. Företaget hyr ut en mängd olika verktyg och industriell utrustning till över 745 000 kunder över hela världen inom byggbranschen, verktyg, infrastruktur, underhållning och nödsituationer.
Dess Sunbelt U.S.-verksamhet är Nordamerikas näst största utrustningsföretag. Den driver 840 butiker och bidrar med 86 % av de totala intäkterna. Sunbelt har också 75 platser och en marknadsandel på 4 % i Kanada.
Företagets verksamhet i Storbritannien är landets största utrustningshyrare, driver 193 butiker och bidrar med 9 % av de totala intäkterna.
Under räkenskapsåret 2020, som avslutades i juni, ökade Ashtead Groups försäljning med 9 %, underblåst av 10 % tillväxt i USA och 22 % tillväxt i Kanada. Företaget öppnade 105 nya butiker förra året, vilket stödde små vinster i vinst per aktie och en fördubbling av det fria kassaflödet till rekordhöga £792 miljoner.
Även om COVID dämpade resultatet för första halvåret 2021, kunde Ashtead Group generera rekordfritt kassaflöde, vilket bådar gott för framtida utdelningstillväxt. Dessutom minskade företaget sin finansiella hävstång till blygsamma 1,7 gånger EBITDA (vinst före räntor, skatter, avskrivningar och amorteringar) och återupptog greenfield-expansionen genom att öppna tre nya butiker.
Ashtead Group höjde sin utdelning med 2 % 2020 efter en rejäl höjning på 21 % 2019. Utbetalningar görs halvårsvis.
Danmarks Novo Nordisk (NVO, $67,89) specialiserar sig på behandlingar för diabetes och fetma och utvecklar även läkemedel mot hemofili och tillväxthormonrelaterade störningar. Företaget levererar nästan hälften av världens insulin från tillverkningsanläggningar i Brasilien, Kina, Danmark, Frankrike och USA.
Novo Nordisk har enorma adresserbara marknader. Världen över lever 463 miljoner människor med diabetes, 650 miljoner människor lider av fetma och 450 000 människor lider av blödarsjuka.
Bolagets strategiska mål för de kommande fem åren inkluderar att öka sin andel av diabetesmarknaden till en tredjedel och fördubbla försäljningen på fetmamarknaden. Novo Nordisk ökade diabetesförsäljningen med 8 % 2020 och diabetesmarknadsandelen till 29 %. Den totala försäljningen ökade med 4%, vinsten per aktie ökade med 10% och utdelningen ökade med 7% förra året. Novo Nordisk vägleder för 5 % till 9 % försäljningstillväxt och 4 % till 8 % vinsttillväxt 2021.
FoU-höjdpunkter under december kvartalet inkluderar en FDA-inlämning för semaglutid, en diabetesbehandling en gång i veckan; en europeisk union som ansöker om en viktkontrollterapi en gång i veckan; och lanseringen av kliniska prövningar i sent skede för ett läkemedel mot Alzheimers sjukdom. Företaget förvärvade också en egenutvecklad läkemedelsleveransteknologi genom köpet av Emisphere.
Eftersom diabetes är ett kroniskt tillstånd skapar Novo Nordisks insulinförsäljning ett robust återkommande kassaflöde som stödjer företagets starka FoU-investeringar och stigande utdelningar.
Novo Nordisk betalar utdelning halvårsvis. Under de senaste fem åren har den här europeiska utdelningsaristokraten ökat sin totala utdelning med ett hälsosamt årligt klipp på 12 %.
Storbritanniens M&G (MGPUF, 3,03 USD) delades nyligen av från Prudential (PUK) och är placerad bland världens ledande kapitalförvaltare och betjänar mer än 5 miljoner privatkunder och 800 institutionella kunder över hela världen.
I Storbritannien och Europa tillhandahåller M&G en mängd olika långsiktiga spar- och investeringsprodukter, inklusive PruFund, en familj av fonder som är inriktad på långsiktig tillväxt med minimal volatilitet. I Amerika, Afrika, Asien och Australien tillhandahåller företaget direkta tillgångsförvaltningstjänster.
M&G är ovanligt när det gäller att vara både ägare och förvaltare av tillgångar, investerar tillsammans med sina kunder och sätter in kapital snabbare än andra. Förutom att vara en av Europas största kapitalförvaltare är M&G en av Storbritanniens största räntespecialister och en ledande global förvaltare av privata tillgångar.
The company benefits from global trends that include an aging world population and more than €10 trillion of investable cash held by European investors.
As part of Prudential, M&G delivered 15 years of rising dividends. In 2019, the company paid an ordinary dividend of 11.92 pence per share and a special demerger dividend of 3.85 pence. The company paid an interim 2020 dividend of 6.0 pence in August and plans to pay a 12.23-pence final dividend in April 2021.
Enagas (ENGGY, $11.10) is Spain's leading natural gas distributor, providing services via 11,000 kilometers of gas pipelines, three underground storage facilities and four regasification plants. In addition, Enagas holds a stake in a regasification plant in Mexico and a major gas pipeline and compressor station in South America. The company also has investments in a LNG terminal in Chile and a gas transportation businesses in Peru.
Enagas' biggest equity partnership is the construction of the Trans Adriatic Pipeline (TAP), which will bring gas to Europe from the Caspian Sea. After nearly five years of construction, commercial operations of the Trans Adriatic Pipeline commenced in November 2020, which should provide a nice boost to Engas' 2021 revenues and earnings.
The company is also an investor in Greek gas operator DESFA and Tallgrass Energy, a U.S. company that owns 11,000 kilometers of gas transmission pipelines.
During 2020, reduced demand for natural gas and electricity trimmed roughly 6% from Enagas' sales, but net profits rose 5% due to good expense controls and favorable exchange rates. The company has a strong balance sheet for a utility, with BBB+ debt ratings from both Fitch and Standards &Poor's and no significant debt maturities before 2022.
Enagas raised its dividend by nearly 3% in 2020 and also paid a modest special dividend.
Belgian holding company Groupe Bruxelles Lambert (GBLBY, $10.54) is one of Europe's largest investment firms. It holds sizable stakes in industry-leading companies such as Adidas (ADDYY) and Pernod Richard (PRDDF). A second business, Sienna Group, invests across leading fund managers. The overall value of the company's investment portfolio exceeded €18.9 billion in 2020.
During the first nine months of 2020, lower earnings from portfolio companies reduced GBL's net asset value and triggered a 29% decline in cash earnings. Despite this, the company's financial position remains solid. GBL has credit ratings of A+ and A1 from S&P and Moody's, respectively, and is one of Europe' highest rated investment managers.
The company has plenty of cash for investments and recently acquired a majority stake in Canyon, Germany's leading manufacturer of premium bicycles and electric bikes. Canyon has been growing sales more than 25% annually.
Over the past 15 years, the company has hiked its dividend 4.6% annually while also returning €5.9 billion to shareholders
British Intertek Group (IKTSY, $82.32) offers product testing, quality assurance and certification services through a network of more than 1,000 labs across over 100 countries. The company is the largest tester of consumer goods worldwide, serving customers in the construction, healthcare, food production and transportation industries.
Intertek Group has an impressive track record for consistent growth showing 10% annual sales gains and 11% yearly EPS gains since its 2002 IPO. Over the same period, dividends have expanded at a 16% annual rate, the highest dividend growth rate among the FTSE 100 companies.
Due to COVID impacts, Intertek reported a 6.7% revenue decline in 2020 on a constant-currency basis. Adjusted earnings dropped by a considerable 18.1%.
However, Intertek Group sees growth opportunities increasing due to the world's post-COVID focus on safety and sustainability, increased regulations and population growth.
The company's dividend growth over the past decade has averaged nearly 13% annually. Intertek Group paid a full-year dividend of 105.8 pence that was in line with 2019.
Founded over 175 years ago, Swiss chocolate-maker Lindt &Sprungli (LDSVF, $8,597.15) is the global leader in premium chocolates. The company sells its products under the Lindt, Hofbauer, Kufferle, Ghiradelli, Whitman's and Russell Stover brands. Sales are made through 500 company-owned shops worldwide that serve more than 80 million visitors a year and through other retail and e-commerce channels.
In the U.S., the world's largest chocolate market, Lindt has the No. 1 market share in the premium chocolate segment and is No. 3 in overall chocolate sales. The company is expanding its U.S. production facilities to support planned volume growth and making upgrades to its logistics network serving U.S. customers.
Lindt &Sprungli is guiding for a 5-7% sales decline in 2020 as a result of COVID-related temporary store shutdowns, but targets a return to 5% annual organic sales growth and improved EBIT margins in 2021.
The European Dividend Aristocrat's payout rose 5% in 2020 and Lindt &Sprungli also paid a modest special dividend. Dividend growth over the past decade has averaged around 7% annually.
Britain's Croda International (COIHY, $45.19) produces high-performance specialty chemicals used in personal care products, as well as in life sciences, performance technologies and industrial applications. The company operates in 38 countries and serves more than 17,000 customers. New patented or protected products contribute nearly 30% of Croda's annual sales.
Croda is developing new personal care products that address consumer demand for greater transparency of ingredients and life sciences products that boost food production. In addition, the company supplies excipients used by Pfizer in its COVID vaccine.
Croda's full-year sales actually improved by 1.1% on a constant-currency basis despite a difficult first six months of 2020. Free cash flow declined by 12.3%.
Croda International has increased dividends every year since 2001. Dividends are paid semi-annually, and the company occasionally also pays a special dividend. Croda marginally hiked its dividend in 2020 while maintaining payout at approximately 55%.
Dublin-based DCC (DCCPF, $81.89) operates large LPG (liquified petroleum gas) sales and marketing operations across the US, Europe and Asia and has a developing business in retail sales of natural gas and electricity. The company also deals in commercial fuels and heating oil and has profitable healthcare and technology businesses. DCC is a member of the FTSE 100 and has annual revenues exceeding £14.8 billion.
In its LPG operations, DCC has established a stable platform for further growth in Germany, Asia and the U.S. while venturing into adjacent fuel markets like natural gas and electricity that leverage its infrastructure and globally recognized brands.
DCC has delivered 14.5% annual growth in operating profits and 14% dividend growth over 26 years. During the six months ended in September, DCC's operating profits rose nearly 9%, fueled by strong contributions from its healthcare business. It has not yet released its full-year results.
DCC has paid a rising dividend every year since 2004. Dividends are paid semi-annually and rose 5% in fiscal 2020.
Danish Novozymes (NVZMY, $62.84) develops industrial enzymes and micro-organisms used in crop production, animal health, food and beverages and cleaning solutions. The company estimate 5.6 billion people worldwide use products containing Novozymes enzymes on a weekly basis.
Novozymes' sales were flat in 2020 and EPS declined 9% as a result of COVID-19 impacts on ethanol and textile production, which were partially offset by increased demand in household care products and from emerging markets. Novozymes launched Biofresh, a treatment for bad breath, last year, which was one of 18 new products launched in 2020. The company also closed two small acquisitions in the human health area.
Novozymes is targeting 2% to 6% organic sales growth in 2021, accompanied by 4% higher free cash flow.
The European Dividend Aristocrat aims to pay out 50% of earnings as dividends and returns excess cash to investors via share repurchases. Novozymes opted to hold its dividend steady at DKK 5.25 per share in 2020, which increased payout slightly to 52%. Over the past five years, Novozymes' dividend has grown approximately 12% annually.
BAE Systems (BAESY, $29.27) is Britain's largest defense contractor and a major supplier of weapons to the U.S. military. The company' derives 52% of revenues from sales of military aircraft, 26% from submarines and warships, and 17% from land-based combat vehicles. BAE also has a small but growing cybersecurity business. The U.S. military is BAE's principal customer, accounting for over 40% of sales. The company supplies Typhoon combat aircraft, subassemblies for F-35 fighters, submarines and warships to the U.S. military.
The company's revenues improved by nearly 4% in 2020, and adjusted earnings ticked 2.1% higher. Free cash flow jumped 60.8%, though that does exclude the impact of a large pension contribution in 2020. BAE's growth was fueled by increased sales of F-35s, land combat vehicles and electronic defense systems, partially offset continued weakness in the commercial portfolio.
BAE Systems has increased dividends every year since 1999, with the exception of 2019 when the company paid an interim but no final dividend. Nonetheless, it maintains its membership in the European Dividend Aristocrats with more than two decades of payout stability and growth.
Consumer products giant Unileve r (UL, $56.69) sells food, beauty care and personal care products used by over 2.5 billion consumers worldwide. The company is a dominant player in many product lines, with 81% of its brands ranking No. 1 or No. 2 in their markets. Unilever brands include Dove soap, Lipton tea, Hellmann's mayo, Breyer's and Ben &Jerry's ice creams, Tresemmé shampoo and Pond's and Noxzema skin softeners. Twelve of the company's brands generate sales greater than €1 billion ($1.1 billion) annually.
Unilever originally consisted of Dutch and U.K. subsidiaries, but the company consolidated its operations into a single entity in 2020. This operational streamlining is expected to reduce costs and make the business more agile.
The company's strategies for growth include expanding in emerging markets and growing its sustainable business, which consists of products (such as cleansers and detergents) that are biodegradable and less polluting.
Unilever's sales rose 2% in 2020 as a result of demand for home hygiene products and in-home foods that more than offset lower sales in other categories. Underlying EPS on a constant currency basis improved 4%. Over the longer-term Unilever is targeting 3% to 5% annual sales gains, profit growth that exceeds sales growth, sustainable strong free cash flow and over £2.0 billion of annual cost savings from its "Fuel for Growth" program.
Unilever pays quarterly dividends. The annual dividends grew 4% last year, and the European Dividend Aristocrat has already raised its quarterly dividend 6% in early 2021.
British American Tobacco (BTI, $38.65) holds the No. 2 share of the U.S. tobacco market and is a market leader in 50 countries. The company owned popular brands like Dunhill, Kent, Lucky Strike, Pall Mall and Rothmans and added the Newport, Camel and Natural American Spirit brands through the 2017 acquisition of Reynolds American.
BAT plans to offset declining cigarette volume by growing sales of its vaping, tobacco heating and modern oral tobacco products. The company's Vuse and Vype e-cigarettes are market leaders in the U.S., Canada and Europe. And its Velo and Lyft modern oral tobacco products are rapidly gaining share in Europe and the U.S.
During the first six months of 2020, BAT's adjusted EPS improved 7% as a result of an improved cigarette price/sales mix and an increased contribution from non-combustible tobacco categories, which rose 71% year-over-year. The company's preliminary 2020 results include a 0.4% decline in revenues, but 5.5% gains in adjusted EPS.
At present, the U.S. is the world's largest vaping market (12 million customers) and BAT anticipates the number of U.S. vaping customers will rise to 50 million by 2030. The company expanded its portfolio of modern oral tobacco products last November by acquiring the Dryft Modern Oral business, which will be rebranded with its Velo name.
This European Dividend Aristocrat transitioned from semi-annual to quarterly dividends in 2018 and increased dividend payments 4% in 2020.
UK-based Diageo (DEO, $169.66) is a global alcoholic beverage company making sales in over 180 countries. The company owns popular brands including Crown Royal and Johnny Walker (whisky), Captain Morgan (rum), Smirnoff (vodka), Tanqueray and Gordons (gin), Bailys (liqueur) and Guinness (beer).
Diageo plans to boost profits by expanding the premium content of its portfolio. It has recently entered new super-premium segments via the acquisition of Aviation American Gin, one of the fastest growing gin brands in the U.S. and the Davos brand portfolio, which includes Astral Tequila, Sombra Mezcal and TYKU Sake. In addition, Diageo plans to acquire the Chase Distillery, which produces Chase GB Gin and Chase Original Potato Vodka. U.K. demand for premium gins is growing twice as fast as the overall gin market.
Diageo achieved 1% organic sales growth during the six months ending in December, fueled by a favorable performance from its North American business. Operating profit fell 3% due to a less favorable channel and category mix.
Dividends are paid semi-annually. Diageo hiked 2020 dividends by 2% and announced an interim dividend payable in April 2021 that is 2% higher than last year. It's among a cadre of European Dividend Aristocrats that have provided steady or higher dividends for more than two decades.
Legal &General Group (LGGNF, $4.10) provides insurance products and services to customers in the U.S. and U.K. The company is the U.K. market leader in risk management and one of Europe's largest asset managers with more than £1 trillion of assets under management.
Its U.S. retirement products business has been a growth catalyst in 2020, contributing 40% growth and $1.6 billion worth of pension risk transfer transactions during the year. In addition, the company's U.S. reinsurance volume has been steadily increasing, with over $5 billion in volume written since 2015. The U.S. retirement products business experienced its strongest September quarter ever in 2020 and has plenty of room to run, given an addressable market estimated at $3 trillion.
Full-year operating profits, however, were flat despite growth in three of its five businesses.
Prior to 2020, Legal &General Group had generated 125% growth in operating profits, 131% EPS gains and 175% dividend growth since 2011. Its fastest-growing businesses – retirement solutions and pension risk transfer – have produced better than 20% annual growth.
Although the company plans to hold its 2020 dividend steady, Legal &General Group targets 3% to 6% annual dividend growth in 2021 and beyond.
Spanish utility Red Eléctrica (RDEIY, $8.86) operates regulated electricity transmission and telecommunication businesses in Spain and internationally. The company owns nearly all of Spain's power grid, has a growing Latin American infrastructure business and recently expanded its telecom operations by acquiring one of Spain's leading communications satellite operators.
Red Eléctrica stepped up investments in international electricity infrastructure during 2020 via an acquisition in Brazil and development projects in Chile and Peru. In addition, the company is building a telecommunications satellite scheduled to launch in 2022. This satellite will provide coverage of the continental US, North Atlantic corridor and Greenland.
The company's net profits fell 4% on a 1% sales decline during the first nine months of 2020 as a result of reduced demand for electricity during COVID business shutdowns and regulatory adjustments that lowered Red Electricia's billable fees.
Red Eléctrica plans to invest €6.4 billion in electricity transmission infrastructure over the next five years and is seeking approval for its plan from EU authorities. Over 60% of the company's proposed spending is for renewables and international interconnections.
Like many European Dividend Aristocrats, RDEIY's dividends are paid semi-annually. It delivered a final dividend of 78 cents per share in 2020, up nearly 10% from one year earlier, but no interim dividend. An interim dividend of 27 cents was paid in January 2021. Annual dividend growth over five years has averaged approximately 8%.
Based in Germany, Fresenius Medical Care (FMS, $37.15) is the world's leading provider of products and services for patients experiencing chronic kidney failure. The company provides dialysis services to nearly 350,000 patients worldwide through its network of 4,000 dialysis clinics. Fresenius is also the market leader in dialysis-related products such as hemodialysis machines and disposables.
Long-term growth drivers for the company's business include an aging global population, increasing incidences of diabetes and high blood pressure, and better-quality treatments. North America represents 70% of the company's revenues.
The company's revenues rose 5% on a constant currency basis during 2020 and adjusted net income improved 12%. Free cash flow surged 120% to €3.2 billion as a result of advanced payments under the CARES Act and other COVID relief and lower U.S. tax payments. Fresenius is guiding for lower 2021 EPS due to COVID effects but sees high single-digit earnings growth through 2025.
Dividend payments are made annually and the company plans to pay a €1.34 dividend in May, up 12% from last year and marking its 23rd consecutive year of dividend growth – good enough to put it among the top half of European Dividend Aristocrats by streak length.
England's Imperial Brands (IMBBY, $20.91) through its subsidiary Imperial Tobacco sells tobacco and e-vaping products worldwide. It is the world's fourth-largest tobacco company thanks to prominent brands that include John Player Special, Winston, Gauloises, Kool, West and Fine cigarettes, Montecristo and Habana cigars, and Blu e-cigarettes. Sales are made in 160 countries with the U.S., Germany, the U.K., Australia and Spain accounting for nearly 75% of operating profits.
The company anticipates its future growth will come from its next generation vaping, heated tobacco and oral nicotine products, which are expected to account for 20% of the nicotine market by 2025.
Imperial Brand's sales were relatively flat in fiscal 2020 ended in September; adjusted EPS declined 6% as a result of lower tobacco profits, increased regulatory costs and losses in the evolving next generation product category. The company sold its premium cigar business last year, used the proceeds to reduce debt, and converted 127% of earnings to cash. Imperial Brands is guiding for low to middle-single digit operating profit growth in 2021.
The European Dividend Aristocrat revised its dividend policy last May to prioritize debt reduction. However, the company has paid dividends continuously since 1997 and is committed to resuming dividend growth in the future. Over the past decade, dividends have grown nearly 6% annually.
Spirax-Sarco Engineering (SPXSF, $163.25) is a U.K. -based manufacturer of industrial and commercial steam systems, electric heating and temperature management solutions and fluid transfer pumps and related technology. The company is a global leader in steam systems and benefits from its resilient business model, which derives roughly 85% of revenues from essential maintenance and repair services for customers.
Revenues declined 4% in 2020, including by 3% on an organic basis. Adjusted basic earnings per share were off by 3% as well.
SPXSF already sells direct in 66 countries and anticipates future growth will come from increasing safety and clean energy regulatory requirements worldwide, geographic expansion, new products and bolt-on acquisitions.
The European Dividend Aristocrat offers an annual payout that improved 10% in 2020 and has risen every year since 1998.
Denmark's Coloplast (CLPBY, $15.05) develops and markets intimate healthcare products and services. It markets ostomy products and accessories under the Sensura and Brava brands, continence care products under the Speedicath, Persisteen and Conveen brands and wound care products under the Biatain brand.
Coloplast holds the leading global market share in ostomy and incontinence care and No. 4 and No. 5 market shares in interventional urology and wound care, respectively. Nearly 60% of Coloplast's sales are made in Europe, 24% are from other developed countries and 17% are from emerging markets.
Despite 2020 challenges due to the cancellation of many elective medical procedures, Coloplast's organic sales grew 4% and EBIT increased 5%. The company also launched its new Strive 25 corporate strategy that aims to increase efficiency via production line automation. This initiative also supports the company's goal of 7% to 8% organic sales growth.
The chronic care markets served by Coloplast provide recurring revenues and stable growth. Coloplast recently entered the $1 billion market for over-active bladder products by acquiring Nine Continents Medical, which is developing an implantable device for treating over-active bladder. This device could seek FDA approval as early as 2024.
Coloplast pays dividends semi-annually and grew payments 6% in 2020.
Swiss healthcare company Novartis (NVS, $86.30) is known for its blockbuster drugs Costentyx (arthritis), Gilenya (neurology) and Entresto (heart failure). Its portfolio includes five blockbuster drugs, each generating more than $1 billion of annual sales. The company has more than 40 new compounds in development and secured FDA approvals to commercialize 26 new treatments during 2020.
Novartis' sales from continuing operations rose 3% in 2020, driven by increased sales of Entresto, Zolgensma and Costentyx, which were partially offset by lower demand for ophthalmology, dermatology and consumer retail products. Net income from continuing operations grew 20% and 2020 free cash flow was 10% lower but still healthy at $11. 7 billion.
Novartis is guiding for low- to mid-single-digit sales growth in 2021 and mid-single digit operating income growth.
The European Dividend Aristocrat increased its dividend 2% in 2020, representing the 24th consecutive year of dividend increases since Novartis' founding in 1996.
Sage Group (SGPYY, $35.14) provides IT solutions to small and medium-sized businesses and serves millions of customers worldwide. This UK-based company offers cloud-based software tools for accounting, financial management, enterprise planning, HR, payroll and payment processing. The company benefits from spending on cloud-based software estimated to grow 11% annually and create a $33 billion addressable market comprised of 69 million small businesses over the next five years.
While Sage Group faces cost challenges recently from customers migrating to the cloud, the company enjoys 90% recurring revenues, excellent free cash flow conversion (123% of earnings) and a resilient balance sheet showing £1.2 billion of cash and investments and a 0.3% ratio of net debt-to-EBITDA.
Sage Group's organic sales rose 4% in 2020 and recurring revenues increased 8%, but operating profit declined 4% due to rising marketing costs. Sage Group targets 3% to 5% growth in recurring revenues in 2021, but lower operating profits due to increased investments in marketing and product development.
Sage Group pays dividends semi-annually. The European Dividend Aristocrat's total payout rose 2% in 2020 and dividends have increased every year since 2005.
Swiss food giant Nestlé (NSRGY, $115.47) is the world's largest food and beverage conglomerate. Its iconic brands include Stouffer's (frozen entries), Purina (pet food), Perrier and Poland Spring (water), Nescafé (coffee), Lean Cuisine (ready-to-eat meals), Haagen-Dazs (ice cream), and Gerber (baby food). Nestle's portfolio includes 34 brands that each generate over CHF 1 billion ($1.12 billion) in annual sales.
The company plans to boost profits by expanding in higher-growth categories such as coffee, pet care, infant nutrition, water and nutritional health. Nestlé also actively manages its portfolio and has acquired or divested more than 50 businesses since 2017. Recent acquisitions include Starbuck's consumer packaged tea and coffee business. Divestitures consisted of Nestle shedding its under-performing USA Confectionery and Gerber life insurance businesses last year.
In 2020, Nestlé's organic sales rose 3.6%, mainly as a result of strong growth in its premium pet food business. Underlying earnings improved by 3.5% on a constant-currency basis.
Nestlé positioned for higher growth in nutritional health products in 2021 by acquiring new collagen products, medical foods and treatments for life-threatening food allergies last year.
Nestlé is one of the oldest dividend payers among the European Dividend Aristocrats; the company has been paying dividends continuously since 1959. Nestlé's dividends grew 10% in 2020 to $2.70 per share.
British Bunzl (BZLFY, $32.79) benefited from robust COVID-related demand for cleaning products in 2020. The company is a leading distributor of cleaning solutions, safety equipment and healthcare consumable products. Its sales of masks, sanitizers, gloves, disinfectants, face shields and related equipment more than doubled last year, and was only partially offset by reduce demand from foodservice customers.
Much of the company's recent growth has come from acquisitions. Bunzl has closed roughly 160 acquisitions since 2004, in the process extending its reach to 31 countries. Transactions from 2020 included the purchase of a Canadian hygiene products company and a Brazilian distributor of protective equipment.
Bunzl's revenues grew by 9.4% on a constant-currency basis in 2020, while adjusted earnings shot 26.6% higher. Meanwhile, it grew the dividend from 51.3 pence to 54.1 pence – a 5.5% improvement. Bunzl has posted 27 consecutive years of dividend increases with annual dividend growth ranging around 10%.
EssilorLuxottica (ESLOY, $80.99) is the world's leading designer and manufacturer of ophthalmic lenses, frames and sunglasses. Headquartered in Paris, the company owns the Ray-Ban, Oakley, Varilux and Transitions eyewear brands and sells direct to consumers through its Sunglass Hut and LensCrafter retail stores. The business was created when lens manufacturer Essilor merged with eyeglass frame maker Luxottica in 2018 and retail stores were added to the mix by purchasing Dutch optical company Grandvision.
Essilor announced a collaboration with Facebook in September to develop Ray-Ban branded "smart" glasses, which will be available in stores beginning in 2021.
COVID-related store shutdowns triggered a 20% decline in Essilor's revenues during the first nine months of 2020, although sales rebounded in the September quarter. E-commerce was a particularly bright spot with September quarter e-commerce revenues up 40% year-to-date.
EssilorLuxottica, which has been among the European Dividend Aristocrats for more than a quarter-century, grew its dividend 35% in 2019 and paid an interim dividend of €1.15 in December 2020. A final dividend has not yet been announced.
French drug-maker Sanofi (SNY, $49.97) specializes in medicines for diabetes, rare blood disorders, immune disorders, cancer and multiple sclerosis. The company also produces vaccines. Sanofi's blockbuster drugs include Lantus (diabetes), Dupixent (atopic dermatitis), Aubagio (multiple sclerosis) and Lovenox (cardiovascular). While Latus sales are declining due to generic competition, Sanofi is offsetting this decline with newer drugs like Dupixent, which grew revenues 74% in 2020.
The company's sales rose 3% in 2020, driven by Dupixent and influenza vaccine sales. Reported EPS was 338% higher due to capital gains from the company's sale of its stake in Regeneron. On an adjusted basis, EPS improved 4%. Sanofi is guiding for high-single-digit EPS growth in 2021.
In January, the company announced plans to acquire Kymab for a $1.1 billion payment upfront and $350 million of milestone payments. Kymab is developing a novel monoclonal antibody that treats a variety of immune disorders and inflammatory diseases.
The European Dividend Aristocrat paid a €3.20 dividend in 2020, up 2% from the prior year, and delivered its 27th consecutive year of dividend growth.
Germany's Fresenius SE (FSNUY, $11.49) is a global leader in healthcare services. The company owns a network of hospitals, a hospital supply business and a project management and construction business serving hospital groups. It also owns a 31% stake in dialysis-services provider Fresenius Medical Care.
Fresenius SE is the largest private hospital operator in Europe based on a network of 89 acute care hospitals, 128 outpatient clinics and six prevention centers that together treat 15.4 million patients annually.
In fiscal 2020, sales improved by 5%, but EBIT (earnings before interest and taxes) were level, and earnings per share declined by 3%.
The company has delivered an impressive 27 consecutive years of dividend growth. Dividends rose 12% in 2020 and growth over five years has exceeded 15% annually.
Dutch IT firm Wolters Kluwer (WTKWY, $89.48) provides professional information and software solutions and services for customers in the healthcare, tax and accounting, corporate governance, legal and regulatory industries. The company sells to customers in 180 countries, and derives roughly 62% of revenues from North America, 30% from Europe and 8% from Asia Pacific.
Recurring revenues represent more than 80% of total revenues and provide Wolters Kluwer with enough flexibility to consistently invest 8% to 10% of sales in product development and pay a rising dividend. The company anticipates future growth will come from extending its product lines and distribution channels and making bolt-on acquisitions that are accretive to EPS.
Reflecting a strong contribution from recurring revenues, Wolters Kluwer's overall sales rose 1% during 2020, adjusted operating profits improved 5% and adjusted free cash flow increased 16% on a constant-currency basis.
The company introduced a COVID-19 Enterprise Solution in 2020, acquired two businesses (XCM Solutions and eOriginal) and divested its ComplyTrack healthcare regulatory risk management tool for an undisclosed amount.
Wolters Kluwer has improved its payout for more than three decades. The company established a progressive dividend policy in 2007 and switched from annual to semi-annual dividends in 2015. Dividends rose 20% in 2019. In 2020, the company paid a €0.47-per-share interim dividend that was 40% less than the prior-year interim dividend. However, a final dividend of €0.89 will result in total payouts of €1.36, up 15% year-over-year.
Ireland's Kerry Group (KRYAY, $131.10) is a leading developer and manufacturer of specialty ingredients used to improve the flavor, appearance and health benefits of packaged foods. The company has manufacturing facilities in 148 sites and sales in more than 150 countries.
Kerry Group is the global market leader in flavorings used in dairy, savory, cereal, beverage and nutritional supplements and also supplies ingredients for five of the world's top 10 blockbuster drugs.
The company's strategies for future growth focus on expanding sales channels and its customer base by entering adjacent markets such as snack foods and food-to-go solutions.
Although COVID negatively impacted the company's first-half 2020 results, the business recovered strongly in the September quarter, generating volume that approached prior year levels. Kerry also acquired a Canadian manufacturer of probiotics and a Chinese supplier of savory flavorings during the September quarter.
Its preliminary expectations for full-year 2020 include a 4.0% decline in revenues, and a 9.4% drop in adjusted EPS.
However, since its 1986 IPO, Kerry Group has generated 10% annual growth in sales, 13% yearly adjusted EPS gains and 17% annual dividend rises. Going forward, Kerry Group targets 10% or higher annual EPS and dividend growth.
The company raised its dividend 10% in 2020, extending its record of payout hikes and continuing its membership in the European Dividend Aristocrats.
Swiss pharmaceutical Roche Holdings (RHHBY, $40.63) is the world's largest biotech company and a leader in in-vitro diagnostics and tissue-based cancer diagnostics. The company owns many of the world's top-selling oncology drugs such as Avastin, Herceptin, Rituxan, Perjeta and Tecentriq.
Roche faces challenges from generic competition for some cancer drugs and aims to offset this impact with newer drugs like Ocrevus (multiple sclerosis), which Roche believes could replace nearly half of the lost cancer sales.
Roche introduced four new medicines in 2020 and has 19 new compounds in late-stage development. The company began a major player in the COVID-19 space during 2020 by launching 15 coronavirus diagnostic products and developing four different medicines for treating COVID-19 infections currently in clinical trials.
Roche's sales grew 1% in 2020 as a result of robust sales of COVID diagnostics, which more than offsetting lower pharmaceutical sales attributable to generic competition. Core EPS rose 4% and Roche is guiding for low to mid-single digit revenue and EPS growth and a rising dividend in 2021.
Roche increased its dividend 3% in 2020, extending its record to 18 consecutive years of payout hikes. All told, it has delivered more than three decades of dividend stability or growth.
French firm L'Oreal (LRLCY, $78.69) is a world leader in skin care, hair care and cosmetics. Its iconic brand portfolio includes the Lancôme Paris, Garnier and Maybelline brands. The company has the No. 1 global share in the cosmetics market, offering 36 different personal care brands across 150 countries. Its products are sold in hair salons, drug stores, big box stores and via the Internet.
Because of its strong brands, L'Oreal was able to outperform the overall beauty market in 2020. The company anticipates a return to growth in 2021, fueled by product launches, maximizing its digital presence and e-commerce channels and expanding its presence in China.
L'Oreal has grown dividends 8% annually over the past 10 years. Shareholders who have owned the stock more than two years also qualify for a 10% loyalty bonus dividend.
U.K.-based Halma (HLMAF, $33.20) provides technologies for the safety, health and environmental markets. Its product line includes instruments for detecting gas leaks, explosions and corrosion and fire detection and suppression systems. Halma derives the majority of its sales in the U.S. and Europe.
The company has generated 17 consecutive years of rising sales and profits, driven by new products and niche acquisitions. Over this period, revenues have risen 10% annually and profits have increased at an 11% annual rate. However, COVID business slowdowns have impacted 2020-21 results; Halma's sales and profits were each down 5% during the first six months of 2020-21.
Halma is the longest-tenured of the European Dividend Aristocrats at more than four decades of payout growth. The company raised its dividend 5% in 2020, extending its consistent record of 5% or higher annual dividend hikes. Analysts look for Halma to deliver 11% adjusted EPS growth and 5% dividend growth in 2020-21.
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