Richlisters earn big dividend payday amid pandemic splurge
A handful of Queensland richlisters will receive more than $100m in dividend payouts as their companies successfully navigate the impact of Covid-19 lockdowns on the economy.
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Queensland richlisters will receive more than $100m in dividend payouts as their companies successfully navigate the impact of Covid-19 lockdowns on the economy.
Some of the state’s most iconic businesses including Domino’s Pizza, Super Retail Group and Eagers have reported solid profits boosted by rising consumer demand during lockdowns.
The splurge on takeaways, leisure gear, new cars and motorbikes is now translating into big pay days for directors and chief executives who have large personal stakes in their companies.
Reg Rowe, a veteran director of Super Retail Group that operates Super Cheap Auto and BCF brands, will receive the biggest dividend payout of them all. He will take home $58m based on his almost 66m shares in the company and its full year dividend of 88 cents a share.
The retailer, which also runs Rebel Sport and Macpac brands, reported a record profit of $301m in the year to June, up 173 per cent on the previous year.
The dividend payout for Mr Rowe, who founded the business from his home in 1972, is closely followed by Domino’s chairman Jack Cowin who will receive almost $40m in dividends. Domino’s chief executive Don Meij, who has overseen the fast-food giant’s expansion of home deliveries during lockdown, will receive $3.1m in dividends.
Domino’s last month said it had achieved a record financial result for the year as the coronavirus pandemic boosted online ordering and delivery services, with global pizza sales reaching more than $3 billion for the first time.
Ord Minnett Queensland state manager David Lane said there had been a swift return in dividend payments for companies that had benefited from strong domestic spending during the past year. “This is reflective of the improvement in profitability and cash flow, with shareholders sharing in the prosperity,” said Mr Lane.
Sydney Roosters chairman and Eagers director Nick Politis will receive more than $19m in dividends from the 150-year-old Brisbane-based car maker where he is the major shareholder.
The nation’s biggest car retailer posted a surge in profit as people splurged on new vehicles rather than booking an overseas trip. David Ahmet, the founder and chief executive of Brisbane-based Motorcycle Holdings, will receive dividends worth $2.28m after he sold more Harleys.
However, not everyone has been so lucky on the dividend front with Flight Centre founder Graham “Skroo” Turner and Corporate Travel Management boss Jamie Pherous not receiving any dividends because of the brutal downturn in their industry.
“These companies are among those that are not paying dividends due to the significant impact that the travel sector has suffered during the pandemic,” said Mr Lane.
Veteran Brisbane stockbroker Charlie Green said dividends were an example of directors being reward for having “skin in the game.”
“I’d much rather see chief executives take large dividends than large salaries,” said Mr Green. “This way, they are far better aligned with all the other shareholders.”
He said there were problems if senior management and directors only had small shareholdings as they may be more worried about their annual pay than the annual dividend.
Mr Green said companies such as Domino’s, Flight Centre and Corporate Travel Management were still run by the people who founded the companies and who retained large shareholdings.
“Many large companies are handicapped because they have managers who are way less concerned about the share price than their annual pay and bonus,” said Mr Green. “You hardly ever see this in founder-led companies.”
Jumbo Interactive founder Mike Veverka, whose company operates lotteries around the world, will receive dividends of $3.65m after the firm lifted profit 7 per cent.
Vita Group founder Maxine Horne will receive $2.4m in dividends after her company, which operates Telstra shops and health spas, posted a double digit hike in full year profit.
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