General Electric Company : GE Boosts Buyback Program by $10 Billion, Raises Dividend 12%
12/14/2012| 11:21am US/Eastern
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By Ben Fox Rubin
General Electric Co. (GE) boosted its share-repurchase program by $10 billion and boosted its dividend by 12% as the industrial conglomerate looks to bolster shareholder value.
"In addition to investing in long-term growth, returning cash to our shareholders remains a top priority," GE Chairman and CEO Jeff Immelt said. "Coupled with our strong operational outlook, today's announcement underscores our balanced and disciplined approach to capital allocation."
The buyback program, which had about $4.9 billion in remaining authorization at the end of its third quarter, was extended through 2015.
The quarterly dividend was raised to 19 cents from 17 cents, which should cost the company an additional $211 million a quarter. The annual yield is now about 3.5%.
GE last raised its dividend late last year, increasing the payout by two cents. The company has raised its dividend five times in three years after drastically cutting the payout in 2009 to 10 cents from 31 cents amid the recession.
The bellwether U.S. conglomerate is continuing the restructuring of its finance and industrial arms, and in July revealed that it will split its energy infrastructure business into three standalone operations.
In October, the company said its third-quarter earnings rose on improved profit margins at GE's industrial businesses, although total orders for new equipment and services slipped and overall revenue was short of Wall Street's forecasts.
Shares were flat at $21.62. The stock is up 21% so far this year.
Write to Ben Fox Rubin at ben.rubin@dowjones.com
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