CA to double dividend, buy back $400m in stock in FY06

Computer Associates International, Inc has announced that its board of directors has authorised the doubling of its annual cash dividend to $0.16 per share, to be paid out in quarterly instalments of $0.04 per share as and when declared by the board, beginning with the dividend for the first quarter of the current fiscal year, which ends on 30 June 2005.

Actual dividends will remain subject to the discretion of the board until actually declared. In addition, the board authorised repurchasing up to $100 million in company shares per quarter over fiscal year 2006, for an annual total of up to $400 million.

"These two actions indicate the confidence CA`s board of directors and senior management has in the company`s ability to grow and deliver shareholder value," said CA President and CEO John Swainson.

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"CA`s strong cash position provides it the flexibility to not only invest in its business, as indicated by the recent proposed acquisition of Concord Communications for about $350 million, but also to strengthen its dividend and execute an effective stock repurchase programme."

Previously, CA paid out its $0.08 per share dividend on a semi-annual basis in instalments of $0.04 each January and July. The company is one of the few technology companies to offer a dividend to shareholders. The annual return to shareholders of the new dividend programme is expected to approximate $90 million.

As of 31 December 2004, 19.2 million shares were available for repurchase under the company`s share repurchase programme. Since December, CA has repurchased 5.5 million shares. The $400 million in share repurchases planned for fiscal 2006 will be covered from the approximately 13.7 million shares remaining in the programme.