Molson Coors has approved a 25% increase in the quarterly dividend rate on its Class A and Class B shares from US$0.16 per share to $0.20 per share.

The increase, payable on 16 June to shareholders of record on 30 May, raises the annual dividend rate from $0.64 per share to $0.80 per share and is payable to holders of Class A and Class B common stock of Molson Coors, as well as to holders of Class A and Class B exchangeable shares of Molson Coors Canada.

"Since the merger in 2005, our brand-building and cost-savings efforts have led to significant sales growth, and after-tax earnings have increased more than 75% in just the past two years," said Leo Kiely, Molson Coors' president and CEO. "This dividend increase reflects our confidence in delivering continued earnings growth and cash generation, and is consistent with our focus on creating long-term shareholder value."

Over the past three years, the company said, it has strengthened the financial foundation of Molson Coors by building its brands, reducing costs, and paying down significant amounts of outstanding debt.

"We are excited to now be in a strong position to increase our dividend significantly while preserving financial flexibility to pursue value-added strategic growth opportunities," said Tim Wolf, the company's CFO.