Dividend income is important for passive income seekers. However, while making Stock Market Investment for the purpose, it should be kept in mind that companies are under no compulsion to pay dividends and it is at the sole discretion of the company.
Two of the long term growth blue chip companies, maintaining consistency are
Macquarie Group (ASX: MQG)
Macquarie Group reported a net profit of A$3.52 billion for FY2024, reflecting a decline from the record highs achieved in the previous two years. The subdued performance was primarily driven by weaker conditions in global energy markets, which significantly impacted earnings for its Commodities and Global Markets (CGM) division. The previous volatility that had fuelled demand for Macquarie's services and created trading opportunities gave way to calmer markets, reducing CGM's profitability. Additionally, softer financial markets constrained other areas of the business, particularly Macquarie Asset Management (MAM). Despite these challenges, Macquarie's diversified business model continues to demonstrate resilience.
The company is among the best blue chip stocks having generated a return on shareholders’ funds of 10.8% for FY2024, slightly below its historical target but still respectable. Over the past five years, the company has delivered an average return of around 15%, highlighting its long-term profitability. Banking and Financial Services (BFS) and Macquarie Capital were bright spots during the year, both delivering higher profits, supported by long-term investments in growth initiatives. BFS achieved a record net profit contribution of A$1.24 billion, a 3% increase from FY2023, driven by growth in its loan portfolio, BFS deposits, and credit impairment reversals, reflecting an improved macroeconomic outlook.
The CGM division posted a net profit contribution of A$3.21 billion, down 47% from the prior year’s exceptional result of A$6 billion, as market volatility subsided. However, CGM maintained revenue levels comparable to FY2022, demonstrating the ongoing strength and resilience of its client franchise. MAM, meanwhile, saw its net profit contribution fall by 48% to A$1.21 billion, impacted by lower asset realisations and increased net expenditure in green energy investments. Nonetheless, MAM’s base and performance fees remained stable, underscoring the division’s long-term growth potential as it transitions to a fiduciary model with a focus on green platforms. Macquarie Capital delivered a notable improvement, with a net profit contribution of A$1.05 billion, up 31% from FY2023. This growth was driven by higher investment-related income, particularly in the private credit portfolio, and a reduction in credit provisions. However, lower advisory income, net gains on investments, and higher operating expenses partly offset this performance.
The company remains well-positioned to navigate ongoing economic uncertainty and subdued market conditions, leveraging its strong client relationships and diversified business model. The Board declared a final dividend of A$3.85 per share, bringing the full-year dividend to A$6.40 per share, consistent with Macquarie's policy of paying between 50% and 70% of earnings. Additionally, the Board approved an on-market share buy-back of up to A$2 billion, reflecting confidence in the company’s long-term outlook. Despite the softer market environment, Macquarie continues to achieve growth in client franchises, fundraising, and new business origination, marking its 55th consecutive year of profitability. This consistent track record underscores the group’s resilience and its capacity to capitalize on future opportunities while managing risks effectively.
Origin Energy Ltd (ASX: ORG)
Origin Energy Ltd is Australia's largest energy retailer, serving approximately 4.7 million customers and positioned to thrive during the ongoing energy transition. One of the blue chip stocks, it boasts a diverse portfolio of generation assets, including significant investments in renewables and storage, aimed at replacing ageing coal-fired power stations and achieving government emissions targets. A key recent development was the agreement with the NSW Government to delay the Eraring coal station’s retirement while ramping up renewable energy and storage capacity to 4-5 GW by 2030, alongside acquiring the Yanco Delta wind farm.
The financial performance for FY24 was robust, with significant earnings growth driven by higher contributions from Energy Markets and Integrated Gas. Origin reported a statutory profit increase to $1,397 million, an uptick from $1,055 million the previous year, reflecting effective capital allocation and strategic decisions made in prior years. The company has also enhanced shareholder returns, with dividends increasing from 36.5 cents to 55 cents per share, underpinned by a strong balance sheet and disciplined financial management.
In the Integrated Gas sector, Australia Pacific LNG demonstrated strong operational performance, contributing substantial cash flows despite a slight decline in earnings from the UK-based Octopus Energy due to external factors. The focus remains on supporting vulnerable customers amid rising energy costs, with a commitment of $100 million for FY24 and FY25 to assist those in financial hardship. Furthermore, Origin has expanded its virtual power plant initiative, which now includes over 343,000 connected services, enhancing its capacity to optimize energy supply and demand.
Origin's strategy focuses on three pillars: providing unrivalled customer solutions, accelerating renewable energy adoption, and ensuring reliable energy supply. Its expectation of continued growth in its customer accounts and a solid commitment to increasing renewable and storage capacity help the company stand well-positioned for the energy transition's challenges. This strategy, bolstered by ongoing investments and innovative projects, aims to deliver sustained value for shareholders while fostering positive outcomes for customers and communities alike.
(Source: Company’s Report)
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