Alaska Air Group Inc said on Thursday it will begin paying a quarterly dividend, signaling a continued effort by U.S. airlines to enhance shareholder returns.

The parent of Alaska Airlines declared a dividend of 20 cents a share that will be paid Aug. 22 to shareholders of record as of Aug. 6.

In a statement, Alaska Air Chief Executive Brad Tilden said a quarterly payout “now makes sense as part of our balanced capital allocation strategy.” The company added the dividend would supplement a $250 million share repurchase program set up last year that is due to terminate by year-end 2014.

Alaska’s move comes as U.S. airlines, which weathered a tough decade after the Sept. 11, 2001, attacks, have largely returned to profitability and are now focusing on improving their investment potential.

Delta Air Lines Inc in May announced its first dividend in a decade and a $500 million share buyback program. Among the major U.S. carriers, Southwest Airlines also pays a dividend and repurchases stock.

Shares of Alaska Airlines rose 2 percent to $58.71 in early trading on Thursday. The stock has risen more than 35 percent so far this year.

(Reporting by Karen Jacobs in Atlanta and editing by Gerald E. McCormick.) Copyright (2013) Thomson Reuters. Click for restrictions.

Photo Credit: An Alaska Airways craft in flight. bigbend700 / Flickr