Canadian coffee-and-doughnut chain Tim Hortons Inc. (THI) reported an 8% drop in fourth-quarter profit due to lackluster sales in the U.S., but shares soared on Friday as the company boosted its dividend payout by 11%.

In the latest quarter, the company earned 69.1 million Canadian dollars ($54.8 million), or 38 Canadian cents (30 cents). The results include a charge of 8 Canadian cents per share related to the closure of 11 underperforming restaurants in New England. Analysts on average were looking for a profit of 38 cents per share.

Although the Oakville, Ontario-based company warned that its American operations would continue to weigh on its performance in 2009, it said its Canadian business remained strong. Tim Hortons also raised its quarterly dividend by 11% to 10 Canadian cents per share and said it will start buying back $200 million in stock in March.

Shares of the company

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