extra dividend business definition

Case Study Phelps Dodge Corporation, a large domestic copper producer, announced in October 2005 that the directors had approved a shareholder capital return program of $1.5 billion. The program consisted of share repurchases and special dividends that were in addition to regular quarterly dividends. The announcement followed an extended rise in copper prices accompanied by large increases in the firm's profits. The extra dividends consisted of $5 per common share paid in December 2005 and $4 per common share paid in March 2006. The special dividends were in addition to regular quarterly dividends of 18.75¢ per share. In April 2006, Phelps Dodge announced that it would increase the program to an overall level of $2 billion and pay a third special dividend of $2 per common share in June. The $2 extra dividend was in addition to the regular quarterly dividend, which was increased to 20¢ per share. Later that year, Phelps Dodge became the target of a successful takeover by another copper producer.