The Dynamic Dividend

2011: The Year of Golden Dividend Hikes

The price of gold was up as much as 34% during 2011*, and producers and royalty companies were far from stingy with their increased profits. At least ten companies that deal with the yellow metal gave their shareholders big raises this year.

And while gold is exiting the year on a weak note (currently down more than 6% in December, dragging its 2011 gains below 13%), companies have continued to raise their payouts aggressively through December. Below are ten of the biggest dividend hikes that can largely be attributed to the rising price of gold in 2011.

IAMGOLD (IAG) raised its payout by 150% in June and tacked on a 25% dividend hike in December. Taking into account the 33% dividend hike announced by IAMGOLD at the end of 2010, the gold producer more than quadrupled its payout in just 12 months. Shares of IAG currently yield 1.54%.

Goldcorp (GG), which pays its dividend in monthly installments, doubled its payout last year and kept the momentum rolling in 2011. The Canadian producer gave its shareholders an 11% raise in February, then tacked on a 32% dividend hike at the beginning of December. Shares of GG currently yield 1.20%.

Royal Gold (RGLD) increased its quarterly dividend by 36% in November, marking the tenth consecutive year the company has given its shareholders a raise. Shares of RGLD carry a 0.86% dividend yield.

AngloGold Ashanti (AU) raised its interim dividend by 44% in early August then proceeded to double its payout just three months later. Shares of AU currently yield 1.04%.

Yamana Gold (AUY) has raised its dividend five times since the start of 2010, quintupling its payout in the process. Yamana’s latest dividend hike came in early November, when the Canadian gold producer increased its payout by 11% to $0.05 per share. Not bad for a company that had never paid its shareholders more than $0.01 per share prior to last summer. Shares of AUY currently feature a 1.33% dividend yield.

Barrick Gold (ABX) raised its payout by 25% in October, marking its first dividend hike in 42 months. Shares of ABX currently feature a 1.30% dividend yield.

Newmont Mining (NEM), which announced in April that it would tie its dividend rate directly to the price of the yellow metal, made good on its promise by giving its shareholders a 50% raise in July and raising its payout by another 17% in October.  Newmont has raised its dividend three times since the beginning of 2010, more than tripling its payout in the process. Based on its most recent quarterly payout, shares of NEM now yield 2.26%.

Kinross Gold Corporation (KGC) increased its semiannual dividend by 20% back in August, marking the first time the Canadian gold producer had given its shareholders a raise in 30 months. Shares of KGC yield 1.02%.

Agnico Eagle Mines (AEM) gave its shareholders a huge 256% raise when the Canadian miner shifted from an annual dividend of $0.18 per share to quarterly payouts of $0.16 per share. Shares of AEM yield 1.74%.

Gold Resource Corporation (GORO) raised its payout by 33% in April, then tacked on an additional 25% dividend hike in August. The low-cost gold producer, which focuses its efforts in southern Mexico, also officially adopted a monthly dividend policy. Shares of GORO now feature a 2.75% dividend yield, tops on this list.

*The SPDR Gold Trust (GLD) hit a high of $185.85 in September, 34.02% higher than its 2011 opening price.