2 ASX shares that could keep growing the dividend every year

These 2 ASX dividend shares keep growing the dividend every year.

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There are a small number of ASX dividend shares that have increased the dividend every year in a row for more than a decade.

Not every business has been able to do that. Indeed, Ramsay Health Care Limited (ASX: RHC) did have a considerable streak going, but then it had to cut the dividend as the profit fell.

But these two have some of the longest records in Australia:

APA Group (ASX: APA)

APA is a diversified energy infrastructure business with a variety of assets, with (currently) a heavy weighting to gas infrastructure. Some of its assets include: a national gas pipeline, gas storage facilities, gas processing plans, gas power stations, wind farms and solar farms.

In terms of being a leading ASX dividend share, the business has grown its distribution every year for the past decade and a half.

APA has already told investors that it’s expecting to increase the distribution by another 3.9% to $0.53 per share. At the current APA share price, that translates to a distribution yield of 6%.

The business pays for its growing distribution from its cashflow. This cashflow is growing organically thanks to positive leverage to increasing inflation as well as its ongoing pipeline of developments. It has a growth pipeline of $1.3 billion over the next three years.

APA has a goal of becoming a leading energy transmission and distribution infrastructure business, delivering the connections that are critical for the rapid growth in renewables and firming generation necessary for the nation’s energy transition.

The energy infrastructure giant thinks there are many billions of dollars of opportunities across electricity, gas and renewables in the coming years. It’s also looking for potential opportunities in the USA.

Washington H. Soul Pattinson and Co. Ltd (ASX: SOL)

Soul Patts is one of the largest conglomerates in Australia. It has been listed on the ASX since 1903 and it has paid a dividend every year since then. However, it hasn’t grown its dividend every year since 1903, but it has achieved consecutive years of growth since 2000. That makes it the ASX dividend share with the longest growth record.

How has it achieved this? It owns a diversified portfolio of assets that pay a dividend, distribution or profit to Soul Patts each year. After paying for its expenses, Soul Patts then pays a slightly higher dividend whilst retaining the rest of the profit and cashflow to re-invest into more opportunities.

Soul Patts has positions in various ASX shares in its portfolio like: TPG Telecom Ltd (ASX: TPG), Brickworks Limited (ASX: BKW), New Hope Corporation Limited (ASX: NHC), Pengana Capital Group Ltd (ASX: PCG), Pengana International Equities Ltd (ASX: PIA) and Bki Investment Co Ltd (ASX: BKI).

It also has a portfolio of unlisted investments such as agriculture, financial services, resources, swimming schools, luxury retirement living and so on.

FY21’s net cashflow from investments was $180 million, which was 6% higher than FY19.

In FY21, Soul Patts grew its annual dividend by 3.3% to $0.62 per share. That currently represents a grossed-up dividend yield of 2.75%.

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Motley Fool contributor Tristan Harrison owns shares of Pengana International Equities Limited and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended Brickworks. The Motley Fool Australia owns shares of and has recommended APA Group, Brickworks, and Washington H. Soul Pattinson and Company Limited. The Motley Fool Australia has recommended Ramsay Health Care Limited and TPG Telecom 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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