I think that there are some high-quality ASX dividend shares that are worth considering buying for income because they are growing their dividends like clockwork.
It's pretty difficult to find growing income at the moment. Many employers are doing it tough, so pay rises are likely harder to come by at the moment. Many businesses are being more careful with their capital, so growing dividends are harder to find as well.
Leaving your money in the bank isn't going to earn much money because Australia's official interest rate is now just 0.25% and could go even lower.
There are still a few great ASX dividend ideas out there that continue to grow their dividends for investors, such as these two:
Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)
Soul Patts is an investment conglomerate which has been listed since 1903, so it's one of the oldest listed businesses in Australia. It started as a pharmacy business but it has diversified into many different businesses since then.
Many of its current biggest holdings started as much smaller investments and grew over time. Names like TPG Telecom Ltd (ASX: TPG), Brickworks Limited (ASX: BKW) and Clover Corporation Limited (ASX: CLV) were much smaller when Soul Patts first invested in them.
It owns a diversified portfolio of plenty of other ASX shares like Magellan Financial Group Ltd (ASX: MFG), Milton Corporation Limited (ASX: MLT), Bki Investment Co Ltd (ASX: BKI) and Australian Pharmaceutical Industries Ltd (ASX: API).
As many readers would know, the more diversified a portfolio is, generally the lower risk it is. Soul Patts has a good amount of diversification and is increasing its diversification, particularly with the unlisted portfolio of businesses. It has investments in Ampcontrol, agriculture, resources, swimming schools and financial services.
Soul Patts is a great ASX dividend share because it has grown its dividend every year for 20 years in a row. No other ASX businesses has a record as good as that. It funds its dividend from the investment income it receives from its investments, minus operating expenses.
At the current Soul Patts share price, it offers a trailing grossed-up dividend yield of 3.3%.
APA Group (ASX: APA)
In my opinion, APA is the best infrastructure business to go for on the ASX.
It owns a vast network of 15,000km of natural gas pipelines around Australia with a presence in every mainland state and the Northern Territory. It also owns or has interests in gas storage facilities, gas-fired power stations and renewable energy generation (wind and solar farms). APA owns, or manages and operates, a portfolio of assets and delivers half the nation's natural gas usage.
I believe the outlook for APA is looking better in recent months with the Australian government championing a focus on gas to help Australia's recovery. Reasonable energy prices are an important factor for both households and manufacturing. Gas is something that Australia has a lot of, but you need pipelines like APA's to help move it around the country.
APA has one of the other best dividend records on the ASX. It has increased its distribution every year for the past decade and a half. That's really reassuring as an ASX dividend share.
The infrastructure business funds its distribution from the annual cashflow that it generates each year. That cashflow is steadily growing as more energy projects come online from its investing.
COVID-19 is causing a bit of an impact on APA's business. But I think that APA will slightly grow its distribution in FY21.
At the current APA Group share price it offers a trailing distribution yield of 4.5%.
