Investors, these days, while expecting low rate environment to continue, are looking for Best Dividend Stocks to add to their portfolio.
Telstra Group Limited (ASX: TLS)
Telstra Group Limited has made notable strides in both capital raising and operational performance as of September 2024. Operationally, Telstra continues to demonstrate strong underlying growth, marking its third consecutive year of such performance. The mobile division remained a key growth driver, with EBITDA increasing by over $400 million, underpinned by strong customer acquisition, adding more than 560,000 net new handheld customers and driving ARPU growth. Mobile services revenue grew by 5.6%, a vital contributor to the company's overall earnings expansion.
Telstra’s infrastructure business also posted solid results, with InfraCo Fixed and Amplitel EBITDA collectively rising by $150 million, reaffirming the company’s confidence in its infrastructure growth strategy. The ongoing investment in Telstra's intercity fibre network aims to future-proof Australia's digital connectivity. Meanwhile, the Fixed C&SB business saw EBITDA growth of nearly $120 million, driven by disciplined cost management and ARPU improvements. However, challenges persist in the Enterprise segment. Telstra has initiated strategic actions to address these issues while continuing to focus on cost management. The company is on track to achieve its $350 million cost reduction target by the end of FY25. Despite these efforts, reported EBITDA declined 4.2% to $7.5 billion due to one-off costs totalling $715 million, resulting in a 12.8% drop in net profit after tax (NPAT) to $1.8 billion. Nonetheless, underlying EBITDA rose by 3.7% to $8.2 billion, leading to a 7.5% increase in underlying NPAT to $2.3 billion. On the back of this underlying growth, TLS, one of the ASX Dividend Stocks declared a fully franked final dividend of 9 cents per share, totalling 18 cents for the year, a 5.9% increase from last year. Telstra's continued investment in connectivity and technological infrastructure is crucial for Australia's future economic growth, resilience, and inclusiveness.
IGO Limited (ASX: IGO)
IGO Ltd is one of the high yield dividend stocks having made significant progress in FY24 despite a challenging market environment. The company has successfully met the Stage 1 Earn-in Requirement of the Copper Wolf Agreement, earning a 51% interest in the JV with Buxton Resources (BUX). A 51/49 JV has now been formed, with IGO managing the project. An operating committee will be established to consider programs and budgets, while IGO has a six-month option to increase its stake by 19% through $5 million in additional exploration expenditure. In operational updates, Barminco extended its contract with IGO to continue mining at the Nova underground nickel mine for an additional 29 months, highlighting the strong collaboration between the two companies since 2015. This extension demonstrates the reliable and safe production capabilities at Nova, which have been a cornerstone of IGO’s operational success.
Despite market headwinds, IGO achieved underlying EBITDA of $581 million and net profit after tax (NPAT) of $2.8 million, down from FY23's $549 million. The company generated underlying free cash flow of $713 million, supported by a solid contribution from its investment in Tianqi Lithium Energy Australia (TLEA), even amid declining spodumene and lithium hydroxide prices. IGO’s cash position was $468 million as of June 30, 2024, down from $775 million the previous year. Consistent with its capital management policy, the Board declared a final fully franked dividend of 26 cents per share, bringing the FY24 total payout to 37 cents, or approximately 40% of underlying free cash flow. Looking ahead, IGO has focused on strategic realignment, with a refreshed strategy set to be released soon. The company has reviewed its corporate and exploration teams to ensure it has the right capabilities in place, aiming to drive long-term value creation for shareholders in FY25 and beyond.
Ricegrowers Limited (ASX: SGLLV)
On October 9, 2024, SunRice announced significant changes to the CY25 pool arrangements for Riverina rice growers. Initially, a two-pool system was proposed back in August following consultations with growers, aimed at maximizing returns amidst various challenges in the growing season. Recently facing conditions have compelled SunRice to review its position and revert back to one-pool system.
As part of the new single pool system, SunRice will accept all paddy from both supplying and non-supplying growers in New South Wales (excluding the Northern Rivers region). Seed orders for medium grain and specialty varieties will remain open, with no immediate closure anticipated. This flexibility allows growers to adjust their seed orders based on the latest updates. SunRice has also revised its CY25 Seed Circular, which outlines these changes, and it will be available on their website soon for growers to review.
With FY2024 results, SunRice has delivered its highest revenue ever at US$1.88 billion and also sets a record by paying fully franked dividend to its shareholders. The company’s earnings saw a significant boost, with a 23% increase in EBITDA to $143.9 million and a 24% rise in net profit after tax to $68.2 million. This has been achieved despite the external challenges since SunRice was able to maintain its paddy price at a good level of $430 per tonne for its medium grain, which means that it has been well-managed and committed to delivering value to both growers and investors.
Source: Company’s Report
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