Key takeaways:

• While several ASX-listed consumer discretionary names trade on dividend yields above 4%, Refinitiv data suggests their earnings could drop over the short-term

• Two New Zealand-based businesses, Briscoes and SkyCity Entertainment, are among the consumer discretionary shares trading on the highest dividend yields, but neither pay franking credits – alternatives include Nick Scali (ASX: NCK) and Harvey Norman (ASX: HVN)

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In 2023, the Consumer Discretionary cohort was the second-best performing sector on the ASX, trailing only Information Technology. Despite expectations that interest rate hikes from the Reserve Bank of Australia could slow the Australian economy, several shares from this sector delivered strong returns last calendar year.

Today we’re looking at five retailers of non-core goods and services that are trading with some of the highest dividend yields in this sector. Our review will cover Australian and New Zealand-based businesses, which raises a key point for prospective investors, as the latter do not pay franking credits on their dividends.

Please note: This list is intended to present a selection of shares from this sector that are trading with the highest 12-month trailing dividend yield (excluding special dividends and disregarding franking status) at the time of writing. All forecasts provided are from Refinitiv, based on a range of analyst estimates. There are no guarantees these shares will continue to pay dividends as they have in the past, or at all.

Autosports Group (ASX: ASG)

Trailing 12-Month Dividend Yield: 7.9% | Refinitiv Forecast Forward Yield (FY25): 7.1% | Market Cap: $506.5 million

Autosports Group is an automotive dealer with principal activities including the sale of new and used motor vehicles, distribution of finance and insurance products on behalf of retail financiers and automotive insurers, sale of aftermarket products and spare parts, motor vehicle servicing, and collision repair services. It deals with various car brands including Alpina, Aston Martin, Audi, Bentley, BMW, BMW Motorrad, Ducati, Jaguar, Kia, and Lamborghini, among others.

The company has approximately 55 retail businesses across Sydney, Melbourne, Brisbane, Gold Coast, and Auckland. It offers a range of different services, including scheduled interval services, quick checks, and special safety checks. ASG operates prestige and luxury car business in Sydney, Brisbane, and Melbourne through Prestige Auto Traders. Via its subsidiaries, it also owns Motorline BMW, Motorline MINI, Motorline Bodyshop, Gold Coast BMW, and Gold Coast MINI.

In February, Autosports Group declared a fully franked interim dividend of $0.10 per share, with the company set to trade ex-dividend on May 16. Prior to that, the last dividend paid by ASG was a final dividend of $0.10 per share, also fully franked. Refinitiv data on the Selfwealth platform forecasts earnings to decrease over the next two financial years and a forward dividend yield of 7.1% for FY25.

Briscoe Group (ASX: BGP)

Trailing 12-Month Dividend Yield: 6.4% | Refinitiv Forecast Forward Yield (FY25): 6.8% | Market Cap: NZ$1.0 billion

Briscoe Group is a New Zealand-based holding company for two retail trading subsidiaries – Briscoes (New Zealand) Limited, and The Sports Authority Limited, trading as Rebel Sport. The company’s retail network consists of a mix of bricks-and-mortar stores, as well as online shopping channels. It operates 47 Briscoes homeware stores, 43 Rebel stores, one distribution centre, and one Auckland-based support centre.

In terms of its two brands, Briscoes (New Zealand) is a specialist homeware retailer selling branded products. Its product categories include bed, bath, electrical, kitchen, dining, laundry, home decor, furniture, and storage, outdoor, travel, and heating. Meanwhile, The Sports Authority is a retailer of brands of sporting goods.

The retailer recently declared a final dividend of NZ$0.165, and before that, NZ$0.125 for its half-year results. Unlike some other shares mentioned above, both dividends were unfranked. Nonetheless, Refinitiv data on the Selfwealth platform predicts these dividend payments will largely be flat over the next two financial years while earnings moderate. This translates into a forward dividend yield forecast of 6.8% for FY25.

SkyCity Entertainment Group (ASX: SKC)

Trailing 12-Month Dividend Yield: 5.9% | Refinitiv Forecast Forward Yield (FY25): 7.3% | Market Cap: NZ$1.4 billion

Another New Zealand-based company, SkyCity Entertainment Group is a tourism, leisure, and entertainment business. It operates integrated entertainment complexes in New Zealand (Auckland, Hamilton and Queenstown) and in Australia (Adelaide), each featuring casino gaming facilities and premium restaurants and bars.

The Company has four segments. Its SkyCity Auckland segment consists of its Auckland operations and includes casino operations, hotels and conventions, food and beverage, Sky Tower, investment properties, and various other related activities. SkyCity Adelaide consists of its Adelaide operations, which comprise casino operations, hotel, and food and beverage. SKC’s ‘Other Operations’ segment includes operations at SkyCity Hamilton, SkyCity Queenstown, SkyCity Wharf, and online gaming, while its International Business segment includes gaming operations for international customers.

For the six months ended 31 December 2023, SkyCity declared an interim dividend of NZ$0.0525. In September last year, the company paid shareholders a final dividend of NZ$0.06 for FY23. Both of these dividends were unfranked. Refinitiv data on the Selfwealth platform suggests SkyCity’s earnings per share and dividend may go backwards in FY24, before potentially rising a year later. Based on these forecasts from Refinitiv, SKC is trading at a forward dividend yield of 7.3% for FY25.

Super Retail Group (ASX: SUL)

Trailing 12-Month Dividend Yield: 5.1% | Refinitiv Forecast Forward Yield (FY25): 5.4% | Market Cap: $3.4 billion

Super Retail Group is primarily involved in the retail industry, with its principal activities including the sale of auto parts and accessories, tools and equipment, retailing of boating, camping, outdoor equipment, fishing equipment and apparel, and retailing of sporting equipment and apparel. The company owns brands like Supercheap Auto (SCA), rebel, BCF, and Macpac.

More specifically, its Supercheap Auto (SCA) segment is engaged in retailing auto parts and accessories, tools, and equipment. Its rebel segment is engaged in the retailing of sporting equipment and apparel. The BCF segment sells boating, camping, outdoor equipment, fishing equipment and apparel, while Macpac is engaged in selling apparel, camping, and outdoor equipment. Super Retail Group operates in Australia, New Zealand, and China.

Shares in SUL traded ex-dividend at the start of March courtesy of a fully franked HY24 dividend of $0.32 per share. Eligible shareholders will receive payment of this dividend on April 12. The preceding dividend paid by Super Retail consisted of a final ordinary dividend of $0.44 per share, and a special dividend of $0.25 share, both fully franked. Refinitiv data on the Selfwealth platform forecasts a drop in SUL’s earnings from current levels, plus a potentially higher dividend and estimated forward dividend yield of 5.4% for FY25.

Myer (ASX: MYR)

Trailing 12-Month Dividend Yield: 4.7% | Refinitiv Forecast Forward Yield (FY25): 2.3% | Market Cap: $661.3 million

Myer Holdings is an Australia-based department store operator. The company operates approximately 58 department stores throughout the nation, as well as an online business. Myer’s merchandise offer includes core product categories: womenswear, menswear, childrenswear, beauty, homewares, electrical goods, toys, and general merchandise.

In addition, the Group also controls brands such as sass & bide, as well as Marcs and David Lawrence (MDL). It directly sources products from over 300 suppliers across 16 countries for its private-label brands. The company also offers a loyalty program, MYER one, where members earn credits on purchases at Myer that convert into reward cards on a quarterly basis.

During March, Myer declared a fully franked interim dividend of $0.03 per share for HY24, with an ex-dividend date of March 27, and payment date being May 16. Before that, the company paid shareholders a fully franked final dividend of $0.01 per share for FY23. Refinitiv data on the Selfwealth platform offers an estimate for the company’s earnings and dividend, with its forecasts suggesting both may decrease over the next two years, and a forward dividend yield of 2.3% in FY25.