General Dynamics [GD] on Wednesday said its board has declared a quarterly dividend of 62 cents per share on the company’s stock, representing a nearly 11 percent increase over the current 56 cents per share dividend.
The new dividend rate is payable May 9. The increase marks the 17
th consecutive year GD has raised its dividend.
The decision to raise the dividend demonstrates confidence in the company’s outlook for cash generation this year.
The dividend increases follows an announcement in early February by GD that it is boosting its stock repurchase program, with its board authorizing the repurchase of up to 20 million shares of the company’s stock. The increase in the share buyback program followed an accelerated repurchase of 11.4 million shares of stock for $1.1 billion, exhausting the previous repurchase authorization.
Phebe Novakovic, GD’s chairman and CEO, said on January that the company expects its free cash flow this year should be in line with historical norms, which usually are above 100 percent of net income. In 2013, GD generated $2.7 billion in free cash and reported $2.4 billion in net earnings.