DEERFIELD, Ill. — The Walgreen Co. board of directors has authorized a new $1 billion share repurchase program and increased its quarterly dividend.
The drug store chain said Wednesday that the new buyback program is slated to expire at the end of 2012.
About a year ago, Walgreens announced a $2 billion share repurchase plan, which the company noted at the time was twice the size of its existing plan.
Also on Wednesday, the Walgreens board declared a regular quarterly dividend of 17.5 cents per share, which the company said represents a 27.3% increase over the year-ago dividend. The dividend is payable on Dec. 11 to shareholders of record as of Nov. 15.
"We are proud of our track record of delivering on our commitment to return cash to our shareholders, and today’s announcement of our new share repurchase program continues that commitment," Walgreens president and chief executive officer Greg Wasson said in a statement. "In our last fiscal year, we returned a record $2.2 billion to shareholders in the form of dividends and share repurchases. And last month, we completed our previous $2 billion share repurchase program that was announced in October 2009."
Walgreens shares have surged in the wake of a robust earnings report for its fiscal 2010 fourth quarter, which topped Wall Street analysts’ projections. The company’s stock jumped more than 10% the day that fourth-quarter results were released. At the market close on Wednesday, Walgreens shares were up 76 cents to $34.80, a gain of nearly $1 from the closing price on the day of the earnings report.
The company noted that it has paid a dividend in 312 straight quarters (78 years) and has raised its dividend for 35 consecutive years. The dividend has been increased by a compound annual growth rate of 24.3% over the last six years, the retailer added.
