The ASX is currently in the middle of reporting season with a number of businesses paying big dividends and a few even announced share buy-backs.
But there are a group of ASX shares that have managed to grow the dividend consecutively whilst also delivering profit growth over time as well.
The below two businesses have long dividend growth records (for the ASX) and just announced another increase:
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Domino's Pizza Enterprises Ltd. (ASX: DMP)
Domino's is earning its status as a global food powerhouse, with strong profit growth in Europe, Asia and ANZ.
It's now generating a large amount of cashflow from its global network, with free cashflow rising 40.2% over FY21 to $216.2 million. During the year it added 285 stores, with 126 new ones in Asia and 129 in Europe. The ASX dividend share has around 3,000 stores now around the world.
In FY21 it grew its dividend by 45.4% to 173.5 cents. The food business decided to increase its dividend payout ratio to 80%, up from 70%.
In FY22 it's expecting to add around 500 more stores to its network, including the Taiwan acquisition. Domino's wants to grow its store network to around 6,650 stores by 2033 and reach 4,000 stores by the end of 2023.
Domino's pointed to group franchisee profitability increasing substantially, due to franchisees' "operational excellence" throughout COVID-19.
The company says that the strength of its business model and long-term strategic focus have allowed it to return more to shareholders, invest in its business and grow both organically and 'inorganically' (through acquisitions).
Bapcor Ltd (ASX: BAP)
The ASX share says that it is committed to growing shareholder value, which it believes requires consideration for all stakeholders.
That includes accelerating its efforts in ESG, it aspires to be net carbon neutral.
In terms of the dividend, Bapcor's board decided to declare a final FY21 dividend of 11 cents, which represented a 15.8% increase on the prior year. The ASX dividend share said this reflected the strong underlying net profit result, where proforma net profit rose 46.5% to $130.1 million.
The full year dividend was increased by 14.3% to 20 cents per share. This dividend represented 52.2% of pro forma net profit.
Bapcor has increased its dividend every year since listing. It started paying a dividend in FY15, with an annual dividend of 8.7 cents per share.
The dividend isn't the only thing that Bapcor has been doing with its capital. It recently finished its new Victorian distribution centre in April 2021. The 13 Melbourne distribution centres will be progressively transitioned to January 2022. This is expected to reduce operating costs by around $10 million per year and inventory by around $8 million once fully commissioned.
Bapcor is also investing in an upgrading its technology infrastructure to support growth in the business.
In terms of guidance, due to the lockdowns, Bapcor is just looking to match the profit it generated in FY21 again in FY22.
According to Commsec, at the current Bapcor share price it has a projected FY22 grossed-up dividend yield of 3.9%.
