Wednesday, January 29, 2014

European Dividend Contenders And Better

Most if not all the Dividend Growth Investors (DGI) on Seeking Alpha have used the so called CCC-list, maintained by David Fish. On this list are companies which have increased their dividend payout for at least 5 years (challengers), 10 years (contenders) or 25+ years (champions). Even though these companies are American based, a lot of these companies on this list have global exposure. However, in any case, they are still listed on American stock exchanges, valued in American dollars and also pay regular dividends in American dollars. For someone based in other areas of the world (in this case Europe), this poses a risk due to changes in the EUR.USD-rate.

As a DGI I would like to diversify my dividend income stream between companies listed in Europe and the USA. Of course the most important thing is that I want to invest in great companies with solid business fundamentals, good history of earnings and dividends and shareholder friendly management. In terms of dividend characteristics I am looking for companies which pay regular (quarterly or semi-annual) dividends and with a history of raising dividends each year. So therefore I started searching for EUR-listed companies to diversify my holdings.


Unilever is a classic example of a Dividend Growth company.
  • Dividend yield is around 3.8% at today's prices.
  • Dividend is raised each year, even during the troubled years of 2008-2009.
  • Dividend growth during the last decade is roughly 10%.
  • Consistent annual dividend raises.
  • Dividend is paid quarterly.

Royal Dutch Shell

Royal Dutch Shell (RDS) is a major energy company. RDS is not a true DG-company since they failed to raise dividends during the Great Recession ('09-'11). However, since 2012 RDS started to raise their dividend again.
  • Dividend yield is around 5.0% at today's prices.
  • Failed to raise dividends yearly in the last decade. Their new policy is to grow the US dollar dividend in line with their view of the underlying earnings and cash flow (whatever that might be).
  • Dividends is declared in US dollars, but is distributed in EUR or GBP as well. This still leaves an income investor vulnerable to changes in the EUR.USD-rate.
  • Dividend is paid quarterly

Total SA

Total SA is also a major energy company.
  • Dividend yield is around 5.4% at today's prices.
  • Failed to raise dividends yearly in the last decade. Between 2008 and 2011 dividend stayed the same. Raises in 2012 and 2013 were relatively small (3% and 1% YOY)
  • Dividend is declared in EUR.
  • Dividend is paid quarterly.


Atrium is a REIT and a owner-operator and developer of shopping centers in Central and Eastern Europe. Atrium specializes in hypermarket- and supermarket-anchored malls in strong locations across the region.

  • Dividend yield is around 5.7% at today's prices.
  • Doubled the dividend between December '09 and '13 which equates to 19% CAGR.
  • Consistent yearly dividend raises.
  • Dividend is declared in EUR.
  • Dividend is paid quarterly.


I haven't found any other European companies which pay quarterly dividends in Euro's. As of now I am leaning towards investing in Royal Dutch Shell. First off, I already own a position in Unilever. Second, I prefer investing in RDS over Total because of tax issues (30% dividend tax in France, only 15% in the Netherlands).

What do you think of these companies? Do you have any other options? Let me know!


  1. I own both Royal Dutch Shell and Unilever (large positions in my portfolio) and as of yet I'm not disappointed in their results. Shell is having some trouble lately, but I hope that the new CEO will take care of that. Although I like Shell, I'm currently selling a portion of my shares. I think alternative energies will be more of a problem than they want to admit. I will never sell all my shares in Shell though, they will probably be active forever.

    Unilever has multiple billion generating products, so what can I see about them? They will be here for a long long time.

    I don't know Atrium. But I will take a look at it because it is one of the companies paying a dividend in Euro's quarterly. My portfolio is heavily over weighted in Dollars.

    1. Hi RobertNL, thanks for your comment! I opened a position in RDS earlier this week. They warned for a decline in profits, but I hope the new CEO will increase the results. Their divestment in certain areas seems prudent (Nigeria, Alaska) and a 4% dividend raise shows commitment to shareholders.

      Do you have other European companies in your portfolio? I am curious to learn more about them.

    2. Hi Robin,

      I have currently Shell, Unilever and Acomo (Amsterdam Commodities) in my portfolio. Acomo is a bit of a odd one, but I really like their business and they pay a nice dividend although the pay those twice a years instead of quarterly. Acomo isn't a large position (<2%) but I will keep them just because I believe they are solid and can grow (although somewhat slowly).

      I'm currently looking in adding BHP Billiton (UK) and Nestle and Novartis (Swiss companies). It's a shame really that dividend isn't common in Europe :(.

    3. Ok, I'll take a look into Acomo. Two dividend payments per year is always better than one payment. BBL/BHP also pays a semi-annual dividend (I own it as well).

      The Swiss companies look great as well, but I think with smaller positions the reinvestment of Swiss dividends could become a pain in the arse because of foreign exchange costs. Receiving dividends in Swiss Francs kind of obliges you to purchase more Swiss shares, right? Saving enough dividends to do a decent sized purchase could take a long time, making dividend reinvestment a lengthy process.

    4. My broker (Binck) doesn't let me automatically reinvest dividend in companies outside the Netherlands.

      I think being exposed to multiple currencies is a good thing, that makes you independent of a specific currency.

  2. Unilever is one company I really want to purchase. Consumer staple with lots of emerging market exposure. Plus they keep raising the dividend and pay a solid yield already. I wish I could help you out with finding more European companies that pay in Euro's but I don't follow them as much because if they don't have ADRs on the US exchanges it becomes prohibitively expensive to purchase them. Best of luck.