The Fortescue (ASX:FMG) dividend has doubled to record levels

The company has rewarded shareholders with a massive dividend.

| More on:
A happy construction worker or miner holds a fistful of Australian dollar notes.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Fortescue Metals Group Ltd (ASX: FMG) dividend received a much-welcomed boost following the company's FY21 full-year results today.

No doubt, investors will be standing with open arms when the mining giant pays its final dividend next month.

Let's take a look at Fortescue's FY21 scorecard and the details of its upcoming dividend.

How did Fortescue perform in FY21?

Investors are buying up Fortescue shares, following the company's positive results for the 12 months ending 30 June 2021.

The world's fourth-largest iron ore miner recorded its second consecutive year of record performance.

Ongoing constraints in iron ore supply from traditional producers resulted in strong market conditions for Fortescue. The average revenue for iron ore rose to US$135 per dry metric tonne, a 72% increase over the period.

Coupled with the company's industry-leading cost position, C1 cost of US$13.93 wet metric tonne, this led to bumper profits.

On the bottom line, Fortescue achieved net profit after tax (NPAT) of US$10.3 billion, up 117% from FY20. This also represents a return on equity of 66%.

The Fortescue board decided to bump up its fully-franked full-year dividend to $3.58 per share, up 103%. This makes up a final dividend of $2.11, equating to $11 billion and an 80% payout of NPAT.

Based on the current Fortescue share price of $21.00 apiece, this gives the company a trailing dividend yield of a mammoth 17%.

Fortescue CEO Elizabeth Gaines commented:

Reflecting the team's outstanding performance in FY21 and our strong commitment to deliver shareholder returns, Fortescue's board was pleased to declare our largest ever final dividend…

The ability to continue delivering increased returns to our shareholders is underpinned by the successful execution of our integrated operations and marketing strategy, disciplined capital allocation, sustained focus on productivity and efficiency, as well as the strength of the iron ore market.

Fortescue dividend key dates

Fortescue provided the distribution amount and payment dates of its final dividend for the 2021 financial year. Here's a summary of the important dates Fortescue shareholders will need to know.

Ex-dividend date

The ex-dividend date will be 6 September 2021.

This is when investors must have purchased Fortescue shares.

If you sell your Fortescue holdings before the ex-dividend date, you will not receive the upcoming dividend. However, if you sell your shares on or after this date, you will still receive the dividend.

Record date

The record date for Fortescue's final dividend is 7 September 2021.

This is the date where the company checks its records to see which shareholders are on its registry. Those who bought Fortescue shares before will be eligible to receive its upcoming dividend.

Payment date

The payment date for Fortescue's dividend will be 30 September 2021.

This is when shareholders can expect to see the final dividend of $2.11 per share arrive in their accounts.

Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Resources Shares

Female miner smiling at a mine site.
Resources Shares

Up 60% this year, this ASX 200 mining stock just smashed production records

Production surge headlines quarterly results.

Read more »

a man in a hard hat and high visibility vest smiles as he stands in the foreground of heavy mining equipment on a mine site.
Resources Shares

After lifting its price target, Macquarie now expects 36% upside from this ASX mining stock

The precious metals producer released better-than-expected production guidance.

Read more »

A miner in a hardhat and high visibility clothing makes a thumbs up symbol.
Resources Shares

4 reasons to buy Rio Tinto shares today

A leading expert forecasts strong growth potential for Rio Tinto shares.

Read more »

Man with rocket wings which have flames coming out of them.
Resources Shares

Why Macquarie expects this ASX All Ords copper stock could surge 38%

With costs coming in below expectations, this ASX All Ords copper stock could rocket higher over the coming months.

Read more »

Iron ore price Vale dam collapse ASX shares iron ore, iron ore australia, iron ore price, commodity price,
Resources Shares

Major miners up as China announces new mega project

Can a new mega-dam absorb iron ore oversupply?

Read more »

A young man sits at his desk with a laptop and documents with a gas heater visible behind him as though he is considering the information in front of him. about the BHP share price
Broker Notes

Leading broker has just downgraded BHP shares. Is it time to sell?

Macquarie sees little upside. But why?

Read more »

A young woman wearing a blue blouse with white polkadots holds her phone up with an intrigued and happy look on her face as she reads some news.
Resources Shares

3 reasons why the BHP share price could be a buy

Here are my optimistic thoughts on BHP.

Read more »

mining asx shares represented by miner writing report on clipboard
Resources Shares

This ASX 200 miner is ramping up copper output as prices reach all-time highs

Copper production leads quarterly update.

Read more »