Jun2023 Finance update - Monthly Dividend/Interest received $13.2K H12023 Total $51.5K

Jun2023 Dividend/Interest received from my investment account is about SGD $13.2k.After adding up the dividend and interest for the last 6 months, 2023 first half investment income hit $51.5K. The more than usual increase in dividend/interest received in 2023 is due to the new bond investment from my retirement account which has been in cash allocation for a long time. My liquid net worth distribution has always been showing almost >30% cash allocation in the last few years. As I mentioned in my previous few blogs, I have invested about 68 % in investment grade and US treasury bonds to lock up the higher interest rate and another 10% into various dividend ETF. The rest is put into short term money market fund which currently yield 4-5% . I am assuming that the FED interest rate hike will end soon and locking into higher long term yield will provide more secure passive income. With this new investment,  my cash holding will be dropping below 15% of my liquid net worth but it will provide an additional USD10K passive income in the next 12 months.  After accounting for the new dividend flow from my retirement account, my monthly distribution chart has been revised upward for the last 6 months. I am also expecting more 5 figures monthly dividend /interest received in the coming months.

Investment Portfolio YTD gain including dividend is 3.64% and liquid net worth YTD gain is around 6.12% 

Trade in June.

I bought back First Pacific 142.hk , added a new HKSE counter 1651.hk (Tsugami Precision) and increased my stakes in 6823.hk, 1.hk, 267.hk, 86.hk. The HKSE trade buy in June is primarily financed by selling off 270.hk and 1339.hk. I have continued to increase my LSE portfolio by adding idap.l ETF and BATS. No action in SGX as I am expecting more right issues. I will be conserving some cash to participate in the right issues.

2017 to 2023 Monthly Dividend/Interest earned from Investment Portfolio :

Dividends received in Jun2023 from Foreign Investment (Stocks): USD $5974
Interest received in Jun2023 from Foreign Investment (bonds): USD $1095
Interest received in Jun2023 from banks interest/FD/others in US: USD $54.5
(Newly added) Dividend/Interest received in Jun2023 from retirement account: USD $1283
Realized gain/loss in USD: $288
Dividends received in Jun2023 from SGX: SGD $2123
Interest received in Jun2023 from banks interest/FD/others in Spore: SGD $211
SGX Realized gain/loss SGD: Nil
Total dividend and interest from my investment portfolio + bank/money market/retirement account + trading gain/loss generated in Jun2023 : SGD$13639
Jun2023 Dividend earned from investment account only: SGD $11314

Counters from my investment portfolio contributing to monthly Dividend/Interest in Jun2023 :

Based on the number of dividend / interest received date, it is like having an additional 14 pay days in June 2023.

Jun2023 Liquid Net worth distribution:

Jun2023 Investment/Retirement Portfolio including SSB(under I bond) :

British American Tobacco (LSE: BATS or NYSE ADR : BTI ) - Attractive 8.6% dividend yield and trades at a low forward P/E of 7.5 but price lowest since 2020

British American Tobacco is one stock that I am vested in and it is down to the lowest level since 2020. However, it is showing some incredible positive financial numbers that put our lousy S-REITs to shame.

First of all , its fwd yield of 8.6% is greater than its fwd PE of 7.56

Market Cap $72.30B

EPS (FWD) $4.31

Div Rate (TTM) $2.68

Payout Ratio :62%

FCF yield of 15%+

Revenue Y/Y +7.7%

EBITDA Y/Y +1.7%
CFO Y/Y +7.0%
EBITDA FWD +3.1%

BTI's payout ratio is 62% today, the lowest payout ratio of the tobacco giants.

$BTI's debt to equity ratio has reduced from 81.1% to 56.3% over the past 5 years.

Debt is well covered by operating cash flow (24.4%).Interest payments on its debt are well covered by EBIT (7.4x coverage).

Profitability

Profit Margin	24.10%
Operating Margin (ttm)	42.17%

Management Effectiveness

Return on Assets (ttm)	5.01%
Return on Equity (ttm)	9.57%

Income Statement

Revenue (ttm)	27.66B
Revenue Per Share (ttm)	12.26
Quarterly Revenue Growth (yoy)	9.50%
Gross Profit (ttm)	22.85B
EBITDA	12.19B

Book Value Per Share (mrq)

33.80

British American's Growth Rates Since 2016 

• Dividend: 4.5% annual growth
• Sales: 5.6% annual growth
• Earnings: 6.4% annual growth
• Operating cash flow: 9.8% annual growth
• Free cash flow: 10.7% annual growth.

Dividend data from seeking alpha:

In British Pounds, BTI has been paying rising dividends every year for 23 years. It's a global aristocrat and in 2025, will become a dividend champion. 

 

British American has a BBB+ credit rating. Nothing in BTI's fundamentals justifies its 11% decline in the last month or 17% YTD decline. British American Tobacco is now the most attractive stock in the consumer staples space. The price is falling far more than future consensus expectations and is continually revealing more value.

 

However, there are no risk-free companies, and no company is right for everyone. You have to be comfortable with the fundamental risk profile.
 
BTI's possible risk factors to be cautious
1)Regulatory risk (global and US) - plain packaging laws, menthol ban, nicotine level regulation, RRP tax policies, RRP approvals
2)Currency risk
3)Interest rate risk: rolling over debt at potentially much higher interest rates  

 

May2023 Finance update - Monthly Dividend/Interest received $6.9K

May2023 Dividend/Interest received from my investment account is about SGD $6.9k. This is slightly lower compare to May2022 due to a dividend stock that has its dividend slashed to almost zero.  Portfolio YTD gain including dividend has collapsed to 0.7% and this is much worst than April as all my three main portfolio in HKSE, S-Reit and LSE are crashing due to many dividend stocks going ex-date , US debt ceiling uncertainty and dismal China PMI report on the last day of  May.  

Trade in May.
I sold off First Pacific 142.hk at a good gain but cut loss on DigitalCore DC reit. I have increased my LSE portfolio by adding idap.l etf  ,BATS and IMB. I have bought a new small stake in Swire Pacific B 87.hk. I have also subscribed 9.5k of KIT due to a right issue. 

Previously, I have been sitting a huge amount of cash in a retirement account from my previous job in the US. I have invested about 68 % in investment grade and US treasury bonds to lock up the higher interest rate and another 10% into various dividend ETF. The rest is put into short term money market fund which currently yield 4-5% . I am assuming that the FED interest rate hike will end soon and locking into higher long term yield will provide more secure passive income. With this new investment,  my cash holding will be dropping below 18% of my liquid net worth but it will provide an additional USD10K passive income in the next 12 months. In May2023, I have started receiving dividend income of USD $986 from my newly revamped retirement account.If this monthly dividend/interest from retirement account is added, my monthly passive income is around 8.2K in May.  I am looking forward to the second half of 2023 as the new dividend/interest from retirement start rolling in and increase my monthly passive income by 1k average.

2017 to 2023 Monthly Dividend/Interest earned from Investment Portfolio :

Dividends received in May2023 from Foreign Investment (Stocks): USD $2125

Interest received in May2023 from Foreign Investment (bonds): USD $425

Interest received in May2023 from banks interest/FD/others in US: USD $43

(Newly added) Dividend/Interest received in May2023 from retirement account: USD $986

Realized gain/loss in USD: $3309

Dividends received in May2023 from SGX: SGD $3323

Interest received in May2023 from banks interest/FD/others in Spore: SGD $205

SGX Realized gain/loss SGD: -2700

Total dividend and interest from my investment portfolio + bank/money market/retirement account + trading gain/loss generated in May2023 : SGD$9783

May2023 Dividend earned from investment account only: SGD $6639

Counters from my investment portfolio contributing to monthly Dividend/Interest in May2023 :

May2023 Liquid Net worth distribution:

May2023 Investment/Retirement Portfolio including SSB:

Apr2023 Finance update - Monthly Dividend/Interest received $7.5K

Apr2023 Dividend/Interest received is about SGD $7.5k. This is about 25% increase compare to Apr2022.  Portfolio YTD gain including dividend is about 8.6% and this is much better than March as stock market recovered this month.  Liquid networth also hit another record high. However, with FED hike in May, the stock market will remain volatile.

One of my largest bond holding ENBA was called and free up USD25k. I have used the available cash to increase my idap.l etf by another USD10k. I have also increased my stake in BABA and GD 270.hk. The remaining was spent on SGX counters Capitaland India, Daiwa and paid for ESR right issue. I have also subscribed another 20k of fresh fund into SSB. This bring my SSB total to $81k. With the new SSB rate coming down to below 3%, this will probably be the last purchase of SSB.

Previously, I have been sitting a huge amount of cash in a retirement account from my previous job in the US. I decided to switch majority of the cash to investment grade and treasury bonds to lock up the higher interest rate. I am assuming that the FED interest rate hike will end soon and locking into higher long term yield will provide more secure passive income. With this new investment , my cash holding will be dropping below 18% of my liquid networth but the it will boost my annual income to over 100k in the next 12 months

2017 to 2023 Monthly Dividend/Interest earned from Investment Portfolio :

Dividends received in Apr2023 from Foreign Investment (Stocks): USD $4128
Interest received in Apr2023 from banks interest/FD/others in US: USD $831
Realized gain/loss in USD: $520
Dividends received in Apr2023 from SGX: SGD $613
Interest received in Apr2023 from banks interest/FD/others in Spore: SGD $211
SGX Realized gain/loss SGD: Nil
Total dividend and interest from my investment portfolio + bank/money market/retirement account + trading gain/loss generated in Apr2023 : SGD$9298
Apr2023 Dividend earned from investment account only: SGD $7331

Interest received in Apr2023 from Foreign Investment (bonds): USD $1038

Counters from my investment portfolio contributing to monthly Dividend/Interest in Apr2023 :

Apr2023 Liquid Net worth distribution:

Apr2023 Investment Portfolio including SSB:

Mar2023 Finance update - Monthly Dividend/Interest received $8.2K and Total Q1 $19.2k

Mar Dividend/Interest received is about SGD $8.2k. Total Q1 Dividend/Interest received is $19.2k which is short of the 20K projected due to 2 counters with dividend cut to 0%. However, this is still a 14% increase compare to Q12022. Portfolio YTD gain drop to 4.7% as US bank crisis in March has adversely impacted all my portfolio except HKSE counters.  

I have increased small stakes in international stocks like BTI and BABA but sold off AVVIY and MO. I have also bought quite a bit of international dividend ETF IDAP (LSE listed) . As disclosed in Feb, I am focusing in increasing dividend ETF in 2023 as opposed to picking individual stocks to reduce dividend cut risk. 

On the SGX front, I bought back digital core reit at 51 cents after selling it for 64.5cents in Feb because I still have the USD sitting in my FSMOne account. It turned out to be a bad decision as digital core reit continue to fall to 41 cents low after another bad news that its second largest tenant which contribute 22.6% of its rental revenue is heading toward a financial issue.  It was a mistake again that I thought I got a good bargain which turned out to be a dud as there were many telling signs why its stock price has been crashing down. I probably have to hold this for a few month to assess the reit manager next move.

2017 to 2023 Monthly Dividend/Interest earned from Investment Portfolio :

Dividends received in Mar2023 from Foreign Investment (Stocks): USD $679

Interest received in Mar2023 from Foreign Investment (bonds): USD $675

Interest received in Mar2023 from banks interest/FD/others in US: USD $809

Realized gain/loss in USD: $938

Dividends received in Mar2023 from SGX: SGD $6128

Interest received in Mar2023 from banks interest/FD/others in Spore: SGD $219

SGX Realized gain/loss SGD: Nil

Total dividend and interest from my investment portfolio + bank/money market/retirement account + trading gain/loss generated in Mar2023 : SGD$10379

Mar2023 Dividend earned from investment account only: SGD $7888

Counters from my investment portfolio contributing to monthly Dividend/Interest in Mar2023 :

Mar2023 Liquid Net worth distribution:

FEB2023 Finance update - Monthly Dividend/Interest received $5.2K

Feb Dividend/Interest received is about SGD $5.2k. YTD gain drop to 6.19% as interest jittery continued in Feb after FED chairman comment on inflation.  

I have increased small stakes in HKSE stocks like Link and BABA . I bought small stakes on 1 new counters Everbright 257.hk and a new dividend ETF IDAP.L . I will focus in increasing dividend ETF in 2023 as opposed to picking individual stocks to reduce dividend cut risk. This year I already have 4 counters projected to incur dividend cut. I have sold partial HK land stake and Digital Core.Reit . 

2017 to 2023 Monthly Dividend/Interest earned from Investment Portfolio :

My Feb 2023 dividend suffered a slight drop compared to 2022 was due to a dividend cut of 95% from a MLP holding KNOP. 

Dividends received in Feb2023 from Foreign Investment (Stocks): USD $1395.78

Interest received in Feb2023 from Foreign Investment (bonds): USD $815.885

Interest received in Feb2023 from banks interest/FD/others in US: USD $749

Realized gain/loss in USD: $1880

Dividends received in Feb2023 from SGX: SGD $2069

Interest received in Feb2023 from banks interest/FD/others in Spore: SGD $213

SGX Realized gain/loss SGD: -$4732

Total dividend and interest from my investment portfolio + bank/money market/retirement account + trading gain/loss generated in Jan2023 : SGD$3794

Feb2023 Dividend earned from investment account only: SGD $4944

Counters from my investment portfolio contributing to monthly Dividend/Interest in Feb2023 :

Feb2023 Liquid Net worth distribution:

Jan2023 Finance update - Monthly Dividend/Interest received $5.7k

Jan Dividend/Interest received is about SGD $5.7k. It was a great start for 2023 as my portfolio gain hit 7% YTD.  My portfolio recovered almost all the paper loss in 2022. This is probably the best January performance of my portfolio since I started investing seriously in 2016.  As a dividend investor that hold long term, I am usually not too concerned with capital gain/loss. Even without capital gain, as long as my portfolio maintain a 6%+ yield on cost dividend/interest, I know that will be my annual realized gain. My main worry only started when suddenly the portfolio unrealized loss come close to 3 years of dividend income at one point in around Oct.  I am glad that my portfolio has proven to be resilient and the recovery has been in line with the broader markets. My liquid net worth also climbed to an all time high.

Since the market has been hitting 6 months high for most stocks by end of the January, I only increased stakes in some of my laggard HKSE stocks like HKBN and AEON credit which yield slightly >8%, and LKSE stocks BATS. I bought small stakes on 2 new counters HK _Electric 2638.hk and Spore Hotel Grand . I think both are undervalued at the moment. Total amount spent is around 28k purchasing equities in January. This brings my projected 2023 investment income to above 91K SGD or 70K USD.

2017 to 2023 Monthly Dividend/Interest earned from Investment Portfolio :

Dividends received in Jan2023 from Foreign Investment (Stocks): USD $2923

Interest received in Jan2023 from Foreign Investment (bonds): USD $1018

Interest received in Jan2023 from banks interest/FD/others in US: USD $389

Realized gain/loss in USD: $0

Dividends received in Jan2023 from SGX: SGD $299.31

Interest received in Jan2023 from banks interest/FD/others in Spore: SGD $215

SGX Realized gain/loss SGD: $48.23

Total dividend and interest from my investment portfolio + bank/money market/retirement account + trading gain/loss generated in Jan2023 : SGD$6195

Jan2023 Dividend earned from investment account only: SGD $5424

Counters from my investment portfolio contributing to monthly Dividend/Interest in Jan2023:

Jan2023 Liquid Net worth distribution:

2022 - My Year of Revenge Travel

Received an email from Google Maps Timeline and quite surprised by the amount of travelling I have 

done in 2022. 😃😃

Most memorable place I visited in 2022 unexpectedly because the original destination was having weather issue. 

2022 FY Finance update -

December Dividend/interest received is about SGD $5.2k and this brings my 2022 annual dividend/interest income to $91K. 2022 investment income received increased by 23% compared to 2021. From my annual Dividend/Interest Income chart in the last 10 years,  it can be seen that my return has been languishing at low 10-15k annually prior to 2016 but I have increased my investment income by almost  6 times in the last 7 years since I took up dividend investment around mid 2016.  My cumulative dividend/interest since 2016 has hit around 406k. However, it was not plain sailing with dividend investment in the last 7 years. When a crisis hit the financial market, the quality of your stock matter the most. I was hit badly with realized loss on some lousy reits and MLP in 2020 and that really eat into the dividend I have earned throughout the years. 

2022 was a brutal year for investors as almost all major markets suffered the worst downturn since 2008.  However, I have suffered less realized loss compared to 2020. This is due to more diversified portfolio where most counters weighting is between 0.5-5%. After cleaning up my portfolio in 2020 by getting rid of low quality reits and MLP, my 2022 portfolio has been more resilient and only suffered ytd -6% despite investing in some of the worst markets like HKSE and LSE. If I include my annual dividend and realized gain of $8.7k, my ytd portfolio performance is only a small -0.1 % in 2022. The dividend collected really help along the way in a bear market. In 2022, my dividend/interest earned has hit record every month from Apr to Oct.

In 2022, I continue to inject a record $181k into equities. I also added $61k SSB and USD100k into US T-bills and short term Investment grade Corporate bonds. Cost of portfolio has increased to 1.67 millions. The SSB and IG bonds shall sort of cushion my new equities investments if the bear market continue into 2023. Those bond investments will also help to optimize the yield of existing cash holding which has been sitting at low yield bank and money market accounts.

In 2022, we see sharp decline in both equities and bonds markets. However, the sharp increase phase in rate hike is almost done which will bring rate to around 4+ to 5%. I believe government and IG bonds price will stabilize but stocks will remain under pressure as long as rate stay high.  My view is that bond rate will probably peak in 2023 and I am hoping to lock in to the higher interest rate bonds with 3-7 years maturity.

With the new investment, I am projecting dividend/interest income to increase to 98k in 2023. However, I am also expecting dividend cut on some of my counters in 2023 as well. Overall strategy in 2023 is to stay offensive by expanding dividend-bearing equities holdings while staying defensive with government and short term IG Corporate bonds investment which will reduce overall volatility in my portfolio.

2017 to 2022 Monthly Dividend/Interest earned from Investment Portfolio :

Dividends received in Dec2022 from Foreign Investment (Stocks): USD $1632

Interest received in Dec2022 from Foreign Investment (bonds): USD $1106

Interest received in Dec2022 from banks interest/FD/others in US: USD $899

Realized gain/loss in USD: $0

Dividends received in Dec2022 from SGX: SGD $1249

Interest received in Dec2022 from banks interest/FD/others in Spore: SGD $209

SGX Realized gain/loss SGD: $0

Total dividend and interest from my investment portfolio + bank/money market/retirement account + trading gain/loss generated in Dec2022 : SGD$6369

Dec2022 Dividend earned from investment account only: SGD $4946

Counters from my investment portfolio contributing to monthly Dividend/Interest in Dec2022:

Dec2022 Liquid Net worth distribution:

Nov2022 Finance update - Monthly Dividend/Interest received $5.6k

Nov 2022 Dividend/Interest come in at around $5.6k. The stock market recovered strongly in the month of November and YTD loss cut by half and with dividend accounted for, it was almost positive. When the market is doing badly, dividend payment definitely help to absorb the temporary paper loss. Liquid Net worth YTD gain also revert to positive territory.

With the depress S-REITs stock price, I have increased my stakes in FCT, ESR, AIM and FLCT.However, I sold all my CLCT and recycle the capital into HKSE stocks like CITIC, NWS and CKH. The reason is that with China pending covid pivot, I find that the HKSE counters have more room for rebound while providing superior yield. As these are blue chip companies, I feel that they are also more financially sound to withstand any change in China policy.

On my interactive broker account, I added LGGNY and 2 bonds WFC and ENB. One of my bond Baidu has also matured this month freeing up some capital for the new bond purchase. As the short term (5 years) investment grade bond start to hit above 5% to 6%, I find quite attractive as a conservative income investor.  Overall, I have put in around 170k new capital into my portfolio and 43k into my SSB. I am projecting that my portfolio will generate more than 92K in 2023 barring any dividend cut.

2017 to 2022 Monthly Dividend/Interest earned from Investment Portfolio :

Counters from my investment portfolio contributing to monthly Dividend/Interest in Nov2022:

Dividends received in Nov2022 from Foreign Investment (Stocks): USD $2072

Interest received in Nov2022 from Foreign Investment (bonds): USD $328

Interest received in Nov2022 from banks interest/FD/others in US: USD $494

Realized gain/loss in USD: $740

Dividends received in Nov2022 from SGX: SGD $2048

Interest received in Nov2022 from banks interest/FD/others in Spore: SGD $238

SGX Realized gain/loss SGD: -$2600

Total dividend and interest from my investment portfolio + bank/money market/retirement account + trading gain/loss generated in Nov2022: SGD$4594

Nov2022 Dividend earned from investment account only: SGD $5288 

Nov2022 Liquid Net worth distribution: