After four consecutive quarters of paying its shareholders a $0.15-a-share quarterly dividend, Kroger's (NYSE:KR) board of directors has authorized a 10% dividend hike, to $0.165 a share, the company announced today.

The dividend will be paid on Dec. 1 to shareholders of record on Nov. 15.

Commenting on the decision to increase the dividend, Kroger Chairman and CEO David Dillon said in a statement, "This increase reflects the Board of Directors' continued confidence that our Customer 1st strategy delivers sustainable shareholder value."

Based on Kroger's share price of $40.56 a share at the close of business Sept. 18, the new quarterly dividend has an annual yield of 1.6%. The improved quarterly dividend payout is the highest Kroger has paid its shareholders since it reinitiated its dividend payment policy in 2006.

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