WOONSOCKET – Shareholders of CVS Caremark Corp. will receive a bigger fourth quarter dividend than expected, the pharmacy chain announced Tuesday.
The company’s board boosted the dividend 43 percent to 12.5 cents a share. Shareholders who owned stock as of Jan. 21 will receive the money on Feb. 2.
The move will cost Woonsocket-based CVS $51 million.
“This marks our eighth-consecutive year of dividend increases, and this substantial increase reflects our solid financial performance, our optimism with respect to future growth and our very significant cash generation capabilities,” said Dave Denton, executive vice president and chief financial officer. “We remain committed to using our free cash flow to enhance total returns for our shareholders, through a combination of high-return investments, dividend increases, and value-enhancing share repurchases.”
The news came a day after the U.S. attorney in New Jersey announced a $969,230 settlement with the company. U.S. Attorney Paul J. Fishman had accused the CVS of employing a pharmacist banned from practicing because of a prior criminal conviction.
Fishman said that Athanasios Mastrokostas filled prescriptions for CVS between September 2005 and July 2009 despite the fact he was barred from participating in federal health care programs. The fine represents double the amount of money CVS collected from Medicare and the military health plan TRICARE for prescriptions filled by Mastrokostas.
Fishman said the settlement avoided the need for a trial.
