DIVIDEND UPDATE - 19 increases and counting...

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We're excited to report that yesterday the DivGro Fund paid out its maiden dividend distribution.

Please check your designated bank accounts to ensure it was received.

Since we last wrote, we have again seen the power of the DivGro philosophy in action. More of our holdings continued to announce potent dividend increases as anticipated by the DivGro system:

Mastercard +21.2%
Stryker +10.6%
Ecolab +2.2%
Zoetis +22.0%
American Tower +20.2%
Abbot Laboratories +12.5%

Note that American Tower raises its dividend every quarter so we annualise the rate of increase for reporting purposes.

We also collected two special dividends, CME and Park Hotels & Resorts. While special dividends are not systematic enough for our dividend engine to rely on, we nevertheless love to receive the additional cash. As an aside, it's generally only extremely cash generative businesses that can afford the luxury of paying special dividends in addition to their rising regular dividends. 

While on the surface Ecolab may appear like a bit of a laggard, Ecolab is in fact in the midst of a spinoff which will place approximately $2.4 billion of annual sales into a separate listed entity (which is anticipated to host its own dividend). This represents about 16% of total sales, so in our minds the 2.2% dividend increase is significantly understated. Since Ecolab enjoys the privileged position of global leader in water treatment, hygiene and food safety we think it is a long term structural winner, and that its future dividend performance will reflect this.  

By way of interest, here is the key section of the Zoetis press release announcing the significant dividend increase:

From inception on 15 August 2019 to 31 December 2019, we're please to report that the DivGro system has now registered 19 dividend increases, at an average increase of 14.8%. These dividend increases drive our rising cash flow which ultimately power DivGro's asset growth. 

For those who have asked about making an additional investment you can access the form here.

We look forward to updating you next with more dividend increases.


Jonathan & Barney 
DivGro Pty Ltd is a Corporate Authorised Representative (CAR No. 1277044) of Lanterne Fund Services Pty Ltd (AFSL No. 238198). The DivGro Fund is open to wholesale investors only, as defined in the Corporations Act 2001 (Cth). The Company is not authorised to provide financial product advice to retail clients and information provided does not constitute financial product advice to retail clients.

The information provided is for general information purposes only, and does not take into account the personal circumstances or needs of investors. The Company and its directors or employees or associates endeavour to ensure that the information is accurate as at the time of its publication. Notwithstanding this, the Company excludes any representation or warranty as to the accuracy, reliability, or completeness of the information contained on the company website and published documents.

The past results of the Company's investment strategy do not necessarily guarantee the future performance or profitability of any investment strategies devised or suggested by the Company.

The Company, and its directors or employees or associates, do not guarantee the performance of any financial product or investment decision made in reliance of any material in this document. The Company does not accept any loss or liability which may be suffered by a reader of this document.
Copyright © 2019 Divgo Pty Limited, All rights reserved.

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Suite 3, 23 Newcastle Street
Rose Bay, NSW 2029

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Divgro Pty Limited · Level 10, Hudson House · 131 Macquarie Street · Sydney, NSW 2000 · Australia

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