Japan's Hitachi Ltd said on Tuesday it would pay a higher dividend this business year for the third straight year, a reflection of a sharp recovery in its earnings. Hitachi, Japan's largest electronics conglomerate, will pay 11 yen (10.5 cents) per share for the year ending March 31, up from 8 yen the previous year.
The company expects its group net profit to jump more than threefold to 50 billion yen for this year, helped by streamlining efforts and a strong performance at its chip equipment unit, Hitachi High-Technologies Corp.
Based on Hitachi's shares outstanding, as of the end of September, its group-based payout ratio is around 70 percent in the current business year, down from 166 percent a year ago.
Hitachi's latest ratio, however, still stands out among Japanese listed firms, which are generally known for lower dividend payouts than US companies.
The payout ratio for Japanese companies listed on the Tokyo Stock Exchange's first section averaged 21 percent in the previous business year, compared to 33 percent for US firms comprising the S&P 500 Index, according to the Life Insurance Association of Japan.
Loss-making companies are excluded from the data.
Shares in Hitachi were up 1.05 percent at 675 yen in afternoon trade, outperforming the Tokyo stock market's electric machinery index, which was down 0.31 percent.
The shares had gained ground before the announcement on the 2004/05 dividend as the Nihon Keizai Timber business daily had said in its morning edition that the company is likely to pay 11 yen per share in dividend.
The newspaper also said Toshiba Corp, Japan's second-largest electronics conglomerate, is expected to pay an annual dividend of 4 yen per share for the current business year, up from 3 yen a year ago.
Toshiba said it had not decided on the size of the dividend.
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