It's payday for Woolworths Group Ltd (ASX: WOW) shareholders, who are due to receive the biggest dividend that the supermarket giant has ever doled out.
Woolworths will be paying 58 cents per share — fully franked — to its shareholders on Wednesday.
This is the final dividend for the FY23 period and represents a 9.4% jump on the final dividend in FY22.
This is the highest single dividend payment that Woolworths has paid since 2014.
It follows a bumper sales period for the supermarket retailer, which reported a 12.7% increase in earnings before interest, taxes, depreciation, and amortisation (EBITDA) at $5.69 billion.
The net profit after tax (NPAT) came in 13.7% higher at $1.72 billion.
Total sales were 5.7% higher at $64,294 million.
Woolworths broke down the bumper result as follows:
- A 5% increase in Australian food sales to $48,047 million
- A 17.4% jump in Australian business-to-business sales to $4,324 million
- An 8% increase in Big W sales to $4,785 million
- A 4.6% rise in New Zealand food sales to NZ$7,912 million
The full-year dividend for FY23 totalled $1.04 per share, which is 13% up on FY22.
Will the Woolworths dividend stay this high?
Glad you asked.
My Fool colleague James can help us out with this question.
He recently reported that top broker Goldman Sachs is forecasting high single-digit earnings for Woolworths and dividend growth every single year from here through to FY26.
Here are Goldman's forecasts for the Woolworths dividend:
- FY24: $1.12 per share
- FY25: $1.22 per share
- FY26: $1.32 per share
The Woolworths share price is currently $37.45, down 0.33% in early afternoon trading on Wednesday.
This means the FY23 Woolworths dividend represents a trailing yield of 2.77%.
Goldman has a buy rating on Woolworths with a 12-month share price target of $42.
The Woolworths share price is up 13.1% in the year to date and up 8.1% over the past 12 months.
