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Alongside a solidifying recovery, dividend payouts held up in the first quarter of 2021, according to a report from U.S. asset manager Janus Henderson.

Global dividends were down 1.7% year over year in the first quarter, which was a much smaller decline than the previous three quarters when dividends dropped at double-digit rates due to fallout from the Covid-19 pandemic, the firm said.

“Mining companies really stood out in the first quarter, as resurgent commodity prices have driven significant growth in payments boosted by large one-off special dividends,” the firm said, noting that utilities and health care also saw higher payouts.

Additionally, financial sector dividends were bolstered by companies resuming dividend payouts that were disrupted by the pandemic and regulatory restrictions.

Just 18% of firms reported lower dividends in Q1 compared with the same quarter last year.

Sectors that continued to face public health restrictions, such as consumer discretionary sectors (retail, consumer durables, vehicles and travel) saw the biggest drop in dividends in Q1, followed by energy stocks and tech dividends.

Looking ahead, the report said dividends will rise in the year ahead as the economic rebound continues.

Janus Henderson upgraded its expectations for global dividends to US$1.36 trillion, representing an 8.4% gain year-over-year.

Over the past four quarters since the pandemic hit, dividends have dropped by US$247 billion, “wiping out almost four years’ worth of growth,” it said.

Despite the decline in payouts, the drop wasn’t as drastic as during the global financial crisis, Janus noted.

U.S. dividends held up better than global payouts in Q1. They were down by just 0.4% compared with the same period last year.

“Looking ahead, dividend payments in the U.S. are poised to accelerate through the end of 2021, as the re-opening of the economy is expected to lift cash flows and improve balance sheets,” said Matt Peron, director of research at Janus Henderson, in a release.

“However, share buybacks, which are also returning at record levels, may influence how much capital is returned to shareholders via dividends as some companies may choose to restore buybacks before increasing dividends,” he added.