Oracle bucks gloom with dividend

Oracle profits have not failed to grow since November 2005

Business software manufacturer Oracle has declared it will pay its first dividend to shareholders after its results beat analysts' forecasts.

It said its quarterly net income fell 1% from a year earlier to $1.3bn (£0.9bn). Software revenues rose 5%.

Oracle said its profits would have grown 11% if the US dollar had not strengthened so much.

A strong dollar means that the company's deals overseas are not worth as much.

Oracle said it would pay a dividend of 5 US cents per share, or 20 cents annually, its first such payment to shareholders since the company went public in March 1986.

"This is a tremendous achievement in the face of the serious slowdown in the world economy," said Oracle boss Larry Ellison.

Shares in Oracle rose 7% in after-hours trading on the news.

Many companies have been cutting or scrapping their dividends to conserve cash to weather the economic downturn.