Walt Disney Co., the world's largest entertainment company,raised its annual dividend by 25 percent, joining other companiesboosting their payouts ahead of an expected tax-rate increase nextyear.
|The 75-cent-a-share payment will be made on Dec. 28 toshareholders as of Dec. 10, the Burbank, California-based companysaid yesterday in a statement. The previous 60-cent annual dividendwas paid to investors in January.
|The early payment allows Disney investors to sidestep a possibleincrease in the tax rate, which is set to rise as high as 39.6percent from 15 percent with the year-end expiration of Bush-eratax cuts. Disney's yield of 1.5 percent remains below the 2.2percent average of the Standard & Poor's 500 Index and canclimb more, said Michael Foss, a portfolio manager.
|“They still have room to move that dividend up over time, evenwith all their growth initiatives,” said Foss, a Disney investor atBrown Advisory in Baltimore. The company reported holding 1.77million Disney shares as of Sept. 30, according to data compiled byBloomberg.
|Disney was expected to raise its dividend to 70 cents, based onBloomberg Dividend Projections. The company posted record revenueand profit in the fiscal year ended Sept. 29, Chairman and ChiefExecutive Officer Robert A. Iger said.
|“Fiscal 2012 was another great year for the Walt Disney Co.,creatively and financially,” Iger said in the statement.
|Disney will pay out about $1.3 billion with the dividend. TheSteven P. Jobs Trust, the company's largest shareholder, willreceive about $103 million, based on data compiled by Bloomberg.The 75-cent payment is more than twice the 35 cents given out in2009.
|President Barack Obama and Congress are negotiating a deal toavoid the so-called fiscal cliff, more than $600 billion inautomatic spending cuts and tax increases set to begin Jan. 1. Inaddition to raising dividends and paying them sooner to beat thetax increase, companies are also declaring special dividends.
|More than 70 companies in the Russell 3000 stock index haveannounced a one-time cash payment to shareholders since September,up from about 15 in the year-earlier quarter, according to datacompiled by Bloomberg. More than a dozen said they acted due topending tax increases.
|Wal-Mart Stores Inc., the world's largest retailer, earlier thismonth moved the payment of its fourth-quarter dividend to Dec. 27instead of the previously scheduled Jan. 2.
|Disney gained 1.2 percent to $49.20 yesterday in New York. Theshares have climbed 31 percent this year.
|Bloomberg News
|Copyright 2018 Bloomberg. All rightsreserved. This material may not be published, broadcast, rewritten,or redistributed.
Complete your profile to continue reading and get FREE access to Treasury & Risk, part of your ALM digital membership.
Your access to unlimited Treasury & Risk content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Critical Treasury & Risk information including in-depth analysis of treasury and finance best practices, case studies with corporate innovators, informative newsletters, educational webcasts and videos, and resources from industry leaders.
- Exclusive discounts on ALM and Treasury & Risk events.
- Access to other award-winning ALM websites including PropertyCasualty360.com and Law.com.
*May exclude premium content
Already have an account? Sign In
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
