Dow Jones NEWSWIRES

Procter & Gamble Co. (PG) said Friday it will raise its quarterly dividend 7%, as the world's largest consumer-goods company looks to boost shareholder return.

The 3.7-cent increase brings the company's quarterly payout to 56.2 cents a share and marks the 56th straight year P&G has raised its dividend. The increase will cost P&G about $407.7 million more a year, based on the number of shares of common stock outstanding as of Dec. 31, 2011.

In January, the company reported its fiscal second-quarter earnings slumped 49% as it booked a heavy write-down and continued to struggle under higher commodity costs.

P&G has said it expects profits to improve in the coming months as commodity cost comparisons start to ease and higher prices lift sales, but earnings for the year will take a big hit as the stronger dollar weighs on results. Higher commodity costs have been a nagging concern for many consumer-goods companies over the past year. P&G, whose products range from Bounty paper towels to Gillette razors, has worked to counter these costs by raising prices and keeping a sharp eye on expenses.

P&G shares were up by 26 cents to $66.07 after hours Friday. The stock is down 1.4% since the start of the year.

-By Nathalie Tadena, Dow Jones Newswires; 212-416-3287; nathalie.tadena@dowjones.com