Peabody Energy cuts dividend by 97%
Coal producer Peabody Energy (NYSE: BTU) will slash its quarterly dividend from $0.09 to $0.0025 per share.
The new annual dividend is just 1 cent, giving the stock an indicated dividend yield of less than 0.2% based on the current stock price of $6.20.
Peabody's annual dividend payment will now be only about $3 million, versus $92 million the company paid the last couple of years. Last year Peabody's stock lost 60%.
Below today's announcement about the dividend cut:
Given market conditions in recent years, Peabody has taken aggressive actions to reduce operating and corporate costs, lower capital spending and complete asset sales to maintain adequate levels of cash and liquidity. Over the next two years, Peabody has nearly $1 billion in annual cash payments associated with debt service, capital investments, Powder River Basin reserve installments and health benefit trust payments. The annual payments related to the final Powder River Basin reserve installments and health benefit trust payments amount to approximately $350 million of the total, and end within two years. As part of a comprehensive program to manage cash and liquidity, the company has reduced the February 2015 quarterly dividend to $0.0025 per share. Peabody's Board of Directors will continue to evaluate the appropriate dividend level on a quarterly basis.
Source: Peabody Energy
The new annual dividend is just 1 cent, giving the stock an indicated dividend yield of less than 0.2% based on the current stock price of $6.20.
Peabody's annual dividend payment will now be only about $3 million, versus $92 million the company paid the last couple of years. Last year Peabody's stock lost 60%.
Below today's announcement about the dividend cut:
Given market conditions in recent years, Peabody has taken aggressive actions to reduce operating and corporate costs, lower capital spending and complete asset sales to maintain adequate levels of cash and liquidity. Over the next two years, Peabody has nearly $1 billion in annual cash payments associated with debt service, capital investments, Powder River Basin reserve installments and health benefit trust payments. The annual payments related to the final Powder River Basin reserve installments and health benefit trust payments amount to approximately $350 million of the total, and end within two years. As part of a comprehensive program to manage cash and liquidity, the company has reduced the February 2015 quarterly dividend to $0.0025 per share. Peabody's Board of Directors will continue to evaluate the appropriate dividend level on a quarterly basis.
Source: Peabody Energy
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