Covidien announces new dividend increase

Covidien has announced that its quarterly dividend rate is to increase by 12.5 percent to $0.225 (0.145 pounds) per ordinary share.

The company's board of directors has declared this increase based on the company's strong financial performance in the year to date, with the annual dividend rate now standing at $0.90 per ordinary share.

Shareholders of record on October 13th 2011 will be receiving their next quarterly dividend on November 4th.

Jose Almeida, president and chief executive officer of Covidien, noted that the firm has returned more than 50 per cent of its free cash flow to shareholders, while investors have also benefited from a recent $2 billion share repurchase programme.

"The combination of this dividend increase … underscores our commitment to balance cash return to shareholders with reinvestment in our business," he said.

According to data from the company's most recent fiscal quarter, Covidien's sales have been significantly above expectations for four quarters in a row.