Ford logos are seen at a company assembly plant.VINCENT KESSLER/Reuters
Ford Motor Co. raised its quarterly dividend 20 per cent, the third boost in as many years, even as the auto maker has said profit would decline for 2014.
The payout, which had been 12.5 cents a share, was boosted to 15 cents, matching a Bloomberg forecast. The Dearborn, Michigan-based company restored the dividend in 2012 at 5 cents after a hiatus of more than five years. The last increase, by 25 per cent, was a year ago. The dividend is payable March 2 to shareholders of record at the close of Jan. 30.
Chief Executive Officer Mark Fields told investors in September that 2014 pretax profit would fall to $6-billion, short of a goal of $7-billion to $8-billion, on higher recall costs, widening overseas losses and spending to introduce an aluminum-bodied F-150 pickup. The second-largest U.S. automaker has said it's still committed to regularly raising the dividend.
The increase is consistent with the company's strategy, Ford said today in a statement.
"Our plan for dividends is to continue to grow regular dividends up to the point that we don't believe this is sustainable," Chief Financial Officer Bob Shanks told investors Sept. 29 in Dearborn. "We don't think we're at that point today where we've reached the level where they're not sustainable over a downturn."
The 15-cent dividend would pay $42.5-million annually to the founding family through its 70.9 million Class B shares, which give them control of the company. Family members including Executive Chairman Bill Ford, great-grandson of founder Henry Ford, are the exclusive owners of the Class B shares, which hold 40 per cent voting power.