2 ASX 200 shares that keep growing their dividends

ASX 200 shares JB Hi-Fi and Domino’s have continued to grow their dividends.

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The are some S&P/ASX 200 Index (ASX: XJO) shares that have continued to grow their dividends for investors for several years in a row.

Whilst there are some businesses that have grown the dividend for many years in a row, such as Washington H. Soul Pattinson and Co. Ltd (ASX: SOL) and APA Group (ASX: APA), there are others that have been growing the dividend at a much quicker rate.

However, just because a business pays a growing dividend doesn’t automatically make it worth owning.

Here are two of those businesses with growing dividends:

JB Hi-Fi Limited (ASX: JBH)

JB Hi-Fi is one of the largest retailers on the ASX, with three operating businesses – JB Hi-Fi Australia, JB Hi-Fi New Zealand and The Good Guys.

Combined, these businesses have been driving JB Hi-Fi’s profit and dividend higher.

JB Hi-Fi has grown its dividend every year since 2013.

FY21 was a big year for the company. The ASX 200 share saw net profit rise 67.4% to $506.1 million, earnings per share (EPS) grew by 67.5% to 440.8 cents and the full year dividend went up 51.9% to 287 cents per share. That means the dividend represented 65% of net profit for the year. In FY13, the annual dividend was $0.72 per share.

JB Hi-Fi’s board said it would continue to regularly review the group’s capital structure with “a focus on maximising returns to shareholders and maintaining balance sheet strength and flexibility.”

The company believes that its successful model is underpinned by five unique competitive advantages: scale, low cost operating model, quality store locations, supplier partnerships and multichannel.

At the current JB Hi-Fi share price, it has a trailing grossed-up dividend yield of 8.6%.

Domino’s Pizza Enterprises Ltd. (ASX: DMP)

Domino’s is another ASX 200 share that has grown its dividend for many years in a row.

The food business now has operations across ANZ, Asia (in Taiwan) and Europe. Indeed, it’s operating in 10 different markets.

Domino’s has grown its dividend every year since 2009 when it started paying one, giving it one of the longest dividend growth runs in the ASX 200.

The company managed to fulfil a lot of demand for online food ordering during FY21. Total network sales increased 14.6% to $3.74 billion, whilst online sales rose 21.5% to $2.93 billion.

Profitability increased at the various levels of the business. Earnings before interest, tax, depreciation and amortisation (EBITDA) rose 19.4% to $424.9 million, earnings before interest and tax (EBIT) grew by 27.2% to $293 million and net profit grew 29.2% to $188.2 million.

But, free cashflow rose the most – rising 40.2% to $216.2 million. The Domino’s board decided to increase the full year dividend by 45.4% to 173.3 cents per share.

Over the next three to five years, Domino’s said it’s expecting its same store sales to grow by between 3% to 6% and new organic store additions to be between 7% to 9% of the network.

Should you invest $1,000 in Domino's right now?

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Motley Fool contributor Tristan Harrison owns shares of Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended APA Group and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Dominos Pizza Enterprises Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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