Two big names in the S&P ASX 200 have lifted their dividends during reporting season which giving income focused investors a rare bit of good news as higher interest rates keep pressure on company payouts.
Telstra has raised its interim dividend to 10.5 cents a share, up from 9.5 cents a year earlier after reporting a rise in first half profit and steady momentum in its mobile business.
The telco said first half profit rose 9.4 per cent to A$1.12 billion and it also increased its on market share buyback from A$1 billion to A$1.25 billion.
Retailer JB Hi Fi has also increased its interim dividend, declaring 210 cents a share, fully franked.
The payment is 40 cents higher than the prior corresponding period which the company said represents a 23.5% lift.
JB Hi Fi said the interim dividend is 75% of net profit after tax and noted it has lifted its target payout ratio from FY26 to a range of 70 to 80% of NPAT.
The moves stand out because many Australian companies have been careful with dividends in recent years, weighing softer consumer demand, higher costs and the need to fund investment and keep balance sheets strong.
For investors, dividend upgrades can signal that boards feel more confident about cash flow and near term earnings.
Even so, analysts warn that payouts can still change quickly if trading conditions shift especially for consumer exposed businesses.
With reporting season continuing, the market is likely to stay focused on companies that can show not just profits but steady cash generation and clear plans for managing capital including dividends that can last beyond a single half year result.
