n Management Dynamics : Journal of the Southern African Institute for Management Scientists - Dividend policies of JSE-listed companies : 1989-2010

Volume 20, Issue 4
  • ISSN : 1019-567X



In this study the dividend policies of a sample of 95 large JSE-listed companies over the period 1989 - 2010 are investigated. The results show that dividend pay-out ratios initially declined through 1999, rose until 2008, declined in 2009 and recovered in 2010. Between 10 and 20% of the companies in a given year did not pay a dividend. Similar dividend pay-out ratio patterns were evident across the nine JSE sectors investigated, with the exception of the basic resources sector. A review of the 2010 annual reports show that a large number of companies are communicating their dividend policies to their shareholders. Some companies highlight the complex interplay between dividend, investment and financing decisions, whereas others merely state their dividend policy in terms of a target dividend cover. Insufficient information is provided in annual reports to allow for the grouping of dividend policies into the traditional textbook categories of stable, constant growth and residual dividends.

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