More than a year ago, in need of cash after its GE Capital lending unit was overwhelmed by the financial crisis, Fairfield-based General Electric did the nearly unthinkable — it slashed its dividend for the first time since the Great Depression, The Associated Press reports.
Now, flush with cash, the conglomerate is starting to reward shareholders again.
GE boosted its quarterly dividend by 2 cents to 12 cents per share Friday, a modest gain compared to the 68 percent cut it made in February 2008 when the GE was in crisis. But GE said the increase, earlier than expected, was a sign that things are much better.
The dividend was increased and accelerated “because of continued strong cash generation, recovery at GE Capital and solid underlying performance in our industrial businesses,” said CEO Jeff Immelt.
Shares of GE rose 51 cents, or 3.3 percent, to $15.72 in late trading.
The company will also start buying back its shares again, and plans on looking at “strategic and financially attractive inorganic growth opportunities,” raising the prospect of future acquisitions.
GE’s moves come after its financial picture brightened in the first half of the year. Last week, it reported a 16 percent gain in quarterly profits, its first growth in net income since late 2007.
