General Electric said Friday that it is raising its quarterly dividend by 2 cents because of its improving financial performance, the first increase since it deeply slashed payments to shareholders last year to save cash. The company also said it would start buying its own shares again. GE will now pay 12 cents per share on Oct. 25, to shareholders who own stock at the close of business on Sept. 20. There are roughly 10.7 billion shares of GE stock. The conglomerate cut its quarterly dividend by 68 percent to 10 cents in February 2009, saying it needed to conserve cash after its GE Capital lending unit was overwhelmed by the financial crisis. It was the first time GE cut its dividend since the Great Depression. GE had said it not begin increasing its dividend until 2011. That date was pushed forward “because of continued strong cash generation, recovery at GE Capital and solid underlying performance in our industrial businesses,” said CEO Jeff Immelt. GE recently posted a 16 percent gain in quarterly profits, the first growth in net income since late 2007. It also expects to end 2010 with about $25 billion in cash. The company is in the process of shrinking GE Capital and whittling down its big losses on bad loans while building back the industrial divisions that make jet engines, power plant turbines and medical equipment. GE suspended its share buyback program in September 2008. It will restart those efforts with about $11.6 billion to spend.
