IPH Limited (ASX:IPH) is showing a trailing Dividend Yield of 11.36%, placing it among the higher yields on the ASX list of companies with Dividend reinvestment plans (DRPs). The intellectual property services group operated its DRP at no discount for its FY26 final dividend of 19.5 cents per share.

IPH shares finished at $3.39, down 8.63% over the past year. Dividends of 38.5 cents with ex-dates in the relevant 12-month period give a trailing yield of 11.36%. It is a historical figure, not a forecast, and the lower share price has contributed to the higher yield.

Latest developments

IPH reported its FY26 results, with underlying net profit after tax and before Amortisation (NPATA) rising 1.7% to $122.7 million, while statutory net profit after tax increased 16.9% to $80.4 million. Statutory Earnings Per Share (EPS) increased 19.7% to 30.9 cents, while underlying EPS rose 4.2%. A stronger Australian dollar weighed on reported earnings, while Canada was a notable contributor on a like-for-like basis.

The board declared a final dividend of 19.5 cents per share, 30% franked, taking the FY26 total to 38.5 cents, up 5.5%. IPH also bought back $18.7 million of shares during the second half and maintained Leverage at 1.8 times, within its target range. Tony O'Malley is managing director and chief executive, and the company has introduced a dividend policy targeting a Payout Ratio of 70% to 90% from FY27.

Key numbers

IPH closed at $3.39, compared with $3.71 a year earlier. Its two dividends with ex-dates in the relevant 12-month period, a 19 cent interim that was 20% franked and the 19.5 cent final that was 30% franked, total 38.5 cents per share and give a trailing yield of 11.36%.

The grossed-up yield is about 12.58% based on the applicable franking levels. Grossed-up yields assume a 30% company tax rate, and their value depends on each investor's tax position. The final dividend was 30% franked.

About the company

IPH is an international intellectual property services group. Through a network of member firms, it helps clients protect and manage patents, trade marks and other intellectual property across multiple jurisdictions. Its operating brands include AJ Park, Griffith Hack, ROBIC, Smart & Biggar and Spruson & Ferguson.

Its clients range from large multinational companies and public sector research organisations to small businesses and professional services firms. The group reports its results across three regions: Australia and New Zealand, Asia and Canada.

How the DRP works

IPH's DRP operated for the FY26 final dividend. Under the company's DRP arrangements, shares were allotted at the average of the daily volume-weighted average Market Price over the applicable five-business-day pricing period, with no discount applied.

The DRP shares were newly issued. IPH issued additional shares under the plan, allowing participating shareholders to receive shares instead of the corresponding cash dividend. Participants can avoid brokerage on the reinvestment, while the market-based pricing means the value of the shares can subsequently move above or below the DRP Acquisition price.

Future participation depends on the terms determined by the board for each dividend. Investors should check the applicable DRP rules and dividend notice before electing to participate in future distributions.

Why it matters for income investors

For income investors, IPH's yield is high relative to many ASX-listed companies, although the dividend is only partly franked. The partial franking means the uplift from franking credits is smaller than it would be for a fully franked dividend, which is why the grossed-up yield is only moderately above the cash yield.

Reinvesting through the DRP allows holders to add shares without brokerage, and each new parcel can become eligible for future dividends. Because the DRP price is set over a defined pricing period, it can be above or below subsequent market prices depending on share-price movements.

What comes next

IPH has not provided specific FY27 earnings guidance. Management has identified organic growth, leveraging its international network, investment in artificial intelligence and automation, and simplifying its operating platform as priorities under the new chief executive.

Investors will also watch how the new 70% to 90% payout policy translates into future dividends, as well as filing activity across Australia and New Zealand and the effect of currency movements on reported earnings.

Any future dividend amount, franking level or DRP terms will be determined by the board and disclosed to shareholders.

Risks and context

A trailing yield is not a forecast. The FY26 dividend exceeded statutory EPS of 30.9 cents, while the introduction of a payout range could affect future dividend levels depending on earnings and Capital requirements. Shares have also fallen 8.63% over the past year, meaning capital movements can offset dividend income.

Company-specific risks include currency movements, given IPH's international earnings exposure, changes in intellectual property filing activity, competition, technology developments including artificial intelligence and the integration of acquired businesses. New DRP shares can slightly dilute other holders. Reinvested dividends remain subject to applicable tax treatment, including any franking credits, and each DRP parcel establishes a new cost base for Capital Gains Tax purposes.

Conclusion

IPH (ASX:IPH) is showing an 11.36% trailing yield on the ASX dividend reinvestment list, with its DRP operating at no discount for the 19.5 cent final dividend. Higher statutory profit, share buy-backs and continued dividend payments provide context for the income profile, while partial franking, currency movements, the new payout policy and share-price Volatility remain relevant considerations.