FRANKFURT -- German supplier Continental plans to pay its first dividend in four years after posting a gain in 2011 profit.
Continental proposed a dividend for last year of 1.50 euros, its first since 2007, the company said in a statement on Monday.
The figure beat the average estimate of 55 cents from 23 analysts surveyed by Bloomberg.
Net income more than doubled in 2011 to about 1.25 billion euros ($1.66 billion) from 576 million euros a year earlier, according to Bloomberg calculations.
Continental said Monday that the dividend payout of about 300 million euros amounts to 24 percent of net income.
"It's a very positive signal and bodes very well in terms of their confidence and ability to generate cash in 2012," said Henning Cosman, a Dusseldorf-based WestLB analyst. "Taken with their capital expenditure plans, which are to be 6 percent of sales in 2012, and their statement regarding deleveraging, and paying out this dividend, it's a very positive signal," he added.
Continental, which will publish full 2011 figures on March 1, reported increasing earnings and revenue last year on demand for cars in China and the United States, the world's two largest auto markets.
Continental expects global automotive sales of 75 million to 78 million vehicles this year.
Continental ranks No. 3 on the Automotive News Europe list of the top 100 global suppliers with worldwide original-equipment automotive parts sales of $24.82 billion in 2010.