2011 Ford Dividend
December 9, 2011 by staff
The company’s board approved a quarterly dividend of 5 cents per share. It will be paid on March 1 to shareholders of record as of Jan. 31.
“We have made tremendous progress in reducing debt and generating consistent positive earnings and cash flow,” Executive Chairman Bill Ford said in a statement. “The board believes it is important to share the benefits of our improved financial performance with our shareholders.”
Ford stopped paying a dividend in September 2006, when it was deeply in debt. The company lost $12.7 billion that year.
Since then Ford has shed brands like Volvo and Mercury, closed factories, offered buyouts to thousands of employees and earned praise and new customers for products like the Ford Explorer SUV and Ford Fiesta subcompact. Ford reported its tenth straight profitable quarter in the third quarter of this year, and it earned $6.6 billion in 2010.
Ford previously planned to wait to resume its dividend until it achieved investment-grade status. Ford’s credit sank to so-called “junk” status in 2005 as it racked up billions in debt.
But Chief Financial Officer Lewis Booth said Ford changed its mind over the summer and decided it didn’t need to wait for the ratings agencies to act.
Booth said Ford’s priority was making sure it was investing in new products and overseas growth. The company then put off action on the dividend until it completed negotiations with the United Auto Workers union on a new four-year contract. Ford workers approved a new contract in October that raises Ford’s labor costs by less than 1 percent per year.
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