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By Bloomberg

WestJet Airlines Ltd. raised its dividend as Canada’s second-largest airline reported an increase in fourth- quarter profit, boosted by falling fuel prices.

WestJet joins its U.S. counterparts in benefiting from a rout in global crude markets that sent prices for jet kerosene plunging 43 percent last year. The carrier, which introduced fees for checked bags about four months ago, is expanding its Encore short-haul network through the addition of destinations in eastern Canada while gearing up for a second season of trans- Atlantic flights.

“WestJet remains on a flight path to continued positive growth, given a relatively healthy aviation environment, coupled with its efforts to expand its reach into new markets,” David Newman, an analyst at Cormark Securities, said in a note to clients published in advance of the results.

The quarterly payout, the fifth increase in four years, will climb to 14 cents a share from 12 cents, Calgary-based WestJet said today in a statement. Net income rose 34 percent to C$90.7 million ($72.4 million), or 70 cents a share, from C$67.8 million, or 52 cents, a year earlier, the carrier said.

That compares with the 74-cent average estimate in a Bloomberg survey of 13 analysts. Fourth-quarter results include pretax incentive payments of C$9.8 million associated with a new pilot agreement and a pretax non-cash loss of C$2.5 million related to a sale of 10 aircraft.

Sales gained 7.3 percent to C$994.4 million, falling just short of the C$997 million average estimate. WestJet had been forecast to boost the payout to 14 cents, according to the average Bloomberg projection. The company began paying a dividend in early 2011.

WestJet rose 4.9 percent to C$31.90 in Toronto yesterday. The stock has fallen 4.4 percent since the start of the year, compared with a 1.8 percent increase for the benchmark Standard & Poor’s/TSX Composite Index.