Food and drinks giant PepsiCo has announced that it plans to raise its targeted dividend payout rate and boosts its share repurchase programme.
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The company said its board had approved plans that would increase cash returns to shareholders. “The plans reflect our continued confidence in the growth of our business and our steadfast commitment to providing strong cash returns to our shareholders,” said chairman and CEO Indra Nooyi.
The company has increased its dividend payout target to 50% of last year’s earnings, beginning with its May dividend declaration. As a result, PepsiCo announced a 25% increase in the annual dividend, raising it to US$1.50 per share from $1.20 per share. That dividend is payable on 29 June to shareholders of record on 8 June.
Regarding share repurchases, PepsiCo’s board has authorised the repurchasing of up $8bn of shares through to mid-2010. This new repurchase programme will begin once the current $8.5bn share repurchase authorisation, which began in 2006 and has some $6bn remaining, has been completed.
