Fortune Brands ( FO) raised its guidance for first-quarter earnings, but announced that it would cut its quarterly dividend to 19 cents a share from 44 cents.

The Deerfield, Ill., consumer-products conglomerate, which owns the Titleist, Jim Beam and Courvoisier brands among others, said it now expects to post a profit of 5 cents a diluted share when its earnings are announced May 1. Excluding expected one-time items, Fortune anticipates posting earnings "in the range of" 30 cents a share.

Analysts polled by Thomson Reuters had been expecting a profit of 18 cents a share before items. In a statement, Fortune also reaffirmed its per-share earnings targets (between $2 and $2.50) for the remainder of 2009. The average of analysts' estimates put the company's 2009 earnings at $2.22 a share.

Despite the sanguine outlook, the company reduced its dividend by 57%, a move designed to bolster its balance sheet by helping increase free cash flow on the year to about $400 million from a previous target of $100 million to $200 million. "This is not an action we took lightly," Fortune Chairman and CEO Bruce Carbonari said in the statement. "One of the undeniable truths of the current economic environment is that 'cash is king.'"

The company plans to use the extra cash -- $125 million of which will come from capital-expenditure reductions -- to pay down debt and "capitalize on potential value-creating opportunities." It wasn't more specific.

The next dividend of 19 cents will be payable June 1 to shareholders of record as of May 13.
Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.

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