Sigma Healthcare Limited (ASX:SIG) is not currently offering shareholders the option to reinvest dividends, as its Dividend reinvestment plan (DRP) is suspended. Its fully franked 2.0 cent final dividend for FY26 was therefore paid entirely in cash.

Latest developments

Sigma, the parent of Chemist Warehouse, reported its FY26 results, with Revenue of approximately $10.8 billion, up 15.5% on a pro-forma basis, and normalised Earnings before interest and tax (EBIT) of $1,090.0 million, up 20.6% on the prior-year pro-forma figure. The company now reports two segments, Australia and International, providing separate disclosure of the offshore Business as it expands.

The board declared a fully franked final dividend of 2.0 cents per share for the second half of FY26, matching the 2.0 cent Interim Dividend for 1H26. The final dividend has since been paid.

Earlier in 2026, Sigma withdrew from the sale process for UK pharmacy chain Boots, ending talks over what would have been a major offshore acquisition.

Key numbers

Sigma paid two fully franked dividends in respect of FY26: a 2.0 cent interim dividend for 1H26 and a 2.0 cent final dividend, bringing total FY26 dividends to 4.0 cents per share.

The prior year's final dividend was 1.3 cents per share, so the payout has increased. Basic Earnings Per Share of 6.2 cents for FY26 exceeded the 4.0 cents of total FY26 dividends.

About the company

Sigma began as a pharmaceutical wholesaler and pharmacy franchisor and became the parent of Chemist Warehouse after the two businesses merged. It now operates a network approaching 1,000 pharmacies globally, including 561 Chemist Warehouse stores in Australia, and also supports the Amcal and Discount Drug Stores brands.

Vikesh Ramsunder is chief executive officer and managing director. Alongside its retail network, Sigma continues to run a pharmaceutical wholesale and distribution business supplying community pharmacies. That combination of franchising, retail and distribution gives it a significant presence in Australian pharmacy, while its international operations provide a smaller earnings stream that grew faster in FY26.

How the DRP works

Sigma's investor centre states that its dividend reinvestment plan has been suspended. The dividend notice for the interim dividend stated that there was no securities plan for the dividend, and the company's FY26 Appendix 4E states that it does not currently have a DRP in operation. As a result, both FY26 dividends were paid entirely in cash.

When a company operates a DRP, shareholders can elect to receive new or acquired shares instead of cash, usually priced at a volume-weighted average over a set period and sometimes at a discount. Any reinstatement of Sigma's DRP would be a decision for the board and would be disclosed in the company's dividend notices.

Why it matters for income investors

With the DRP suspended, shareholders do not have the option of receiving Sigma shares in place of cash dividends through a plan.

The dividend has grown, with the latest two payments of 2.0 cents each compared with 1.3 cents for the FY25 final, and both are fully franked, which carries franking credits for eligible shareholders.

A cash-only dividend also means there is no dilution from new shares being issued under a plan, and shareholders receive the full dividend amount in cash.

What comes next

Sigma's Annual General Meeting is the next scheduled event on the corporate calendar. Areas of focus include growth in the Chemist Warehouse network, progress in the international segment, and whether the company reinstates a DRP.

Future dividends, their franking and any change to the DRP will be decided by the board and disclosed to the ASX. An interim dividend for 1H27, if declared, would typically be announced with half-year results.

Risks and context

Past dividends are not a guide to future payments, and any future dividend remains subject to board determination.

Company-specific risks include competition in pharmacy retail, regulatory changes affecting medicines and pharmacy ownership, execution risk in offshore expansion, and the integration of the merged business, where expected cost savings may take longer to deliver than planned. If the DRP were reinstated, reinvested dividends would still be assessable income, and each DRP parcel would set a new cost base for Capital Gains Tax purposes.

Conclusion

Sigma Healthcare (ASX:SIG) grew revenue and earnings in FY26 and lifted its fully franked dividend, with total FY26 dividends of 4.0 cents per share. With its DRP suspended, dividends are currently paid in cash only.

Key Insights

Sigma Healthcare (ASX:SIG) reported higher pro-forma revenue and normalised EBIT in FY26 and paid fully franked interim and final dividends of 2.0 cents each, up from a 1.3 cent final in FY25. Its DRP remains suspended, so both FY26 dividends were paid entirely in cash, and any reinstatement would be a matter for the board.