Last week, Costco announced their quarterly cash dividend but they also surprised me by announcing a special cash dividend as well. If you’re a Costco stockholder, like I am, you’ll be very pleased with this announcement.
Shareholders of record as of the end of business on February 13, 2015, will receive a quarterly cash dividend of 35.5 cents per share. The regular quarterly cash dividend will be paid on February 27, 2015. Last year at this time, Costco’s quarterly cash dividend was just 31 cents per share, so this is a nice 4.5 cents per share increase. Costco started paying a quarterly cash dividend of 35.5 cents per share in May 2014. So, I’m hoping that they have another raise in the plans for May 2015.
But the really good news is the big special dividend.
Richard Galanti, Executive Vice President and Chief Financial Officer, commented: “Today’s announcement of a$5.00 special dividend is our latest step in returning capital to our shareholders while maintaining our conservative capital structure. Our strong balance sheet and favorable access to the credit markets allow us to provide shareholders with this dividend, while also preserving financial and operational flexibility to grow our business globally; and allowing for ongoing dividend and share repurchase activities.”
Costco will be paying a special cash dividend of $5.00 per share on February 27, 2015 for all shareholders of record as of February 9, 2015; this is in addition to the regular quarterly dividend. In total, Costco will be paying out an aggregate of $2.2 billion, which will be paid for through existing cash and some additional borrowings. Costco last paid out a special cash dividend of $7.00 per share in December 2012, so this isn’t quite as much as that one, but is definitely great for shareholders.