TORONTO - Corus Entertainment Inc.'s decision to boost its dividend by 25 per cent Wednesday sent its stock trading higher than it has since the financial crisis struck and the recession a toll on television and radio advertising.

"Our strong free cash flow will support the increased dividend and also provide Corus with the flexibility to invest and grow our business," said president and CEO John Cassaday on a conference call with analysts Wednesday.

Corus (TSX:CJR.B) shares closed up 53 cents at $22.08 Wednesday on the Toronto Stock Exchange, the highest it has traded at since mid-2008.

The 15-cent dividend increase — from 60 to 75 cents per share— comes even as the Toronto-based media company reported weaker fourth-quarter profits due to a corporate restructuring during the summer.

Corus earned $6.8 million in the three months ended Aug. 31, down 64 per cent compared with $18.7 million a year earlier. On an earnings per share basis, the company earned eight cents, down from 23 cents a year ago.

The results included a $12.9-million charge related to its restructuring, and $7.9 million in radio tariffs.

Quarterly revenue increased nearly four per cent to $202.8 million, up from $195.2 million a year ago.

Revenue for the specialty TV channels rose three per cent to $139.9 million. The radio segment, which has been slower to recover from the 2008-09 recession, saw revenue increase five per cent to $62.9 million.

The average analyst estimate had been for earnings of 28 cents per share and $207 million in revenue, according to an analyst survey from Thomson Reuters.

Corus radio managed to outperform its competitors in the fourth quarter in the key cities it competes in, Cassaday said.

"In addition to gains from the ongoing recovery in the radio advertising market, radio is capitalizing on growth in the automotive category drive by both domestic and foreign auto companies and their dealerships," he said.

In addition to heavy advertising for local dealerships on radio stations, there is a correlation between how many Canadians own cars and how many listeners radio stations attract because commuters are a captive audience. Stations see interest peak during key commuting times.

For the full year, Corus earned $126.7 million, or $1.56 per share, reversing a loss of $56.6 million, or 71 cent per share a year ago. Revenue was up six per cent to $832.2 million from $788.7 million.

Corus stood by full-year projections of a profit between $285 million and $295 million in 2011 that the company had made in September, saying the outlook for advertising markets continues to bode well for the company.

"For the radio division, the turnaround in the ad markets is very encouraging total radio advertising revenue in Q1 is pacing ahead of last year in the mid-to high single digits," he said.

Like all Canadian radio stations, Corus faces higher copyright tariffs that it expects will cost the company $3 million next year.

In its television segment, which includes both specialty channels like HBO Canada and YTV, growth will continue into the first quarter of 2011. Cassaday said.

"We expect high single digit increases from our specialty ad sales in Q1 with particularly strong growth expected in our kids segment."

Drew McReynolds, an analyst with RBC Capital Markets, said although Corus results missed analysts' expectations, its shares remained positive because of the dividend boost and the reiteration of its 2011 guidance as investors looked past the end of this fiscal year.

"The magnitude of the dividend increase is an incremental positive," he wrote in a note to clients.

McReynolds added that the slightly disappointing fourth quarter, "was primarily driven by lower than expected radio revenues and margins, as well as higher than expected corporate costs."

Meanwhile, he said the company reported solid momentum in television advertising revenues, as specialty advertising was up 22 per cent, although that was offset by a 32 per cent decrease in non-specialty advertising.

Pay television subscribers increased one per cent from last year, below McReynolds'estimate of three per cent.

The company has been in the midst of a major consolidation of its operations in Toronto, moving 11 different facilities throughout the city under one roof.

Corus Quay, on Toronto's waterfront, brings together 24 television services, three radio stations and more than 1,100 employees.

The company also recently announced plans to carry OWN: The Oprah Winfrey Network when the channel launched by American actor, celebrity and businesswoman Oprah Winfrey premieres on Jan. 1.

Corus has specialty television and radio operations across Canada as well as assets in pay television, television broadcasting, children's book publishing and children's animation.