Factors influencing dividend payout decisions : evidence from South Africa

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dc.contributor.authorNyere, Lovemoreen_ZA
dc.contributor.authorWesson, Nicoleneen_ZA
dc.date.accessioned2021-08-27T19:35:25Z
dc.date.available2021-08-27T19:35:25Z
dc.date.issued2019
dc.descriptionCITATION: Nyere, L. & Wesson, N. 2019. Factors influencing dividend payout decisions : evidence from South Africa. South African Journal of Business Management, 50(1):a1302, doi:10.4102/sajbm.v50i1.1302.
dc.descriptionThe original publication is available at https://sajbm.org
dc.description.abstractBackground: Dividend payout is one of the most debated contemporary corporate finance issues. No universal theoretical model describes the factors that corporate managers consider in dividend payout decisions. This study extends previous South African empirical research on dividend payout trends and motivations for Johannesburg Stock Exchange (JSE)-listed industrial companies over the period 1999–2014. The study period coincides with the introduction of share repurchases as an alternative distribution method, covers multiple dividend distribution regulatory amendments and overlaps the global financial crisis of 2008. Objectives: The aim of this study was to ascertain whether the global financial crisis of 2008 affected dividend payouts and to identify factors that influenced dividend payout decisions of JSE-listed industrial companies over the period 1999–2014. Method: Descriptive statistics and a fixed-effects panel regression analysis were applied to dividend data extracted from published annual reports of JSE-listed industrial companies over the period 1999–2014. Results: Dividend distributions of JSE-listed industrial companies increased over the study period in contrast to declining global dividend distribution trends. A significant increase in dividend payout was found when comparing pre- and post-recession periods, in line with the positive impact of dividend distribution regulatory reforms. Company size (+), profitability (+), sales growth (−) and free cash flow (−) were identified as significant factors that influence dividend distributions of JSE-listed industrial companies. Conclusion: The results offer support for the company life cycle hypothesis, the taxes and clientele hypothesis and corporate managers’ preference for stable dividend policies.en_ZA
dc.description.urihttps://sajbm.org/index.php/sajbm/article/view/1302
dc.description.versionPublisher's version
dc.format.extent16 pages : illustrationsen_ZA
dc.identifier.citationNyere, L. & Wesson, N. 2019. Factors influencing dividend payout decisions : evidence from South Africa. South African Journal of Business Management, 50(1):a1302, doi:10.4102/sajbm.v50i1.1302
dc.identifier.issn2078-5976 (online)
dc.identifier.issn2078-5585 (print)
dc.identifier.otherdoi:10.4102/sajbm.v50i1.1302
dc.identifier.urihttp://hdl.handle.net/10019.1/122102
dc.language.isoen_ZAen_ZA
dc.publisherAOSIS
dc.rights.holderAuthors retain copyright
dc.subjectJohannesburg Stock Exchangeen_ZA
dc.subjectDividends -- Accounting -- South Africaen_ZA
dc.subjectFinancial crisisen_ZA
dc.subjectManagerial economics -- South Africaen_ZA
dc.subjectSouth Africa -- Economic policyen_ZA
dc.subjectStocks -- Prices -- South Africaen_ZA
dc.titleFactors influencing dividend payout decisions : evidence from South Africaen_ZA
dc.typeArticleen_ZA
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