News

Wendy's reaches proposed $50M hacker attack settlement, announces 18 % dividend increase

February 15, 2019

It's a good-news, bad-news kind of week for Wendy's, which announced an 18 percent dividend increase for the latest quarter and that it reached an agreement to settle a hacker attack case for $50 million.

That hefty settlement is the proposed amount that the chain will pay to financial institutions that alleged its data security systems allowed access to the chain's customers' credit card information, according to Bloomberg Law.

As part of the proposed settlement, the assortment of credit unions and other institutions will release Wendy's from further claims. First Choice Federal and Alcoa Community Federal credit unions sued the burger chain after a data breach which they alleged occurred because Wendy's data security systems were left vulnerable. 

As a result, the settlement said that 18 million payment cards were impacted by the "third-party criminal cyber attacks" on some independently owned franchises. U.S. District Judge Nora Berry Fischer of the Western District of Pennsylvania will ultimately rule on whether the proposed settlement will stand. 

In better news for the burger QSR today, Wendy's board authorized an 18 percent quarterly dividend increase, from 8.5 cents to 10 cents per share. The increase is payable March 15 to shareholders of record as of March 1, 2019. 

The company said as of Feb. 13, there were approximately 230.1 million common shares outstanding in the 6,500-location chain. 

"Returning cash to shareholders remains a key priority for us," Wendy's President and CEO Todd Penegor said in the release. "This is the seventh consecutive year that we have increased our dividend, which is a testament to the strong cash flow generation from our resilient and predictable business model."