Gannett Company’s board of directors has approved a 100% increase in the company’s quarterly dividend. The company is also resuming its stock buyback program.
Gannett shareholders are in line to receive eight cents per share each quarter, up from the previous four cents. The increased quarterly dividend is payable on October 3, 2011 to shareholders of record on September 9, 2011. “This dividend represents the 172nd consecutive quarterly dividend paid by the company since it went public in 1967,” the announcement noted.
In addition, the board authorized the resumption of share repurchases under the $1 billion share repurchase program originally approved on July 25, 2006. Current authority remaining under the program is approximately $809 million.
The company said it expects to repurchase up to $100 million of shares over the next 12 months. “The board will continually reassess these actions depending on economic and market conditions. The shares will be repurchased at management’s discretion, either in the open market or in privately negotiated block transactions. The decision to buy back stock will depend on price, availability and other corporate developments. Purchases will occur from time to time and no maximum purchase price has been set,” the company said.
“We are committed to creating value for our shareholders and believe our stock is an outstanding investment at current price levels. The actions taken today reflect our confidence in the company’s long term growth prospects, our ability to consistently generate substantial free cash flow and our strong financial position. At the same time, and equally as important, we will have the financial flexibility to continue to grow our businesses and invest in new opportunities,” said CEO Craig Dubow.
The actions came even as Gannett reported a decline in Q2 revenues and profits. As for the investing in new opportunities mentioned by Dubow, in the company’s quarterly conference call Gannett officials acknowledged that the Freedom, McGraw-Hill and Young television groups are all being shopped and Gannett looks at “everything” – the focus is on investing in digital media, which has been the company’s strongest growth area.