StoneMor Partners cuts distribution by 50%
StoneMor Partners L.P. (STON) will lower its quarterly distribution to $0.33 per unit. Previously the dividend had been raised for 10 consecutive years.
Larry Miller, President and CEO of StoneMor, commented, “As previously discussed, we are working to re-grow our sales force, increasing both its quality and size. To accomplish this, we have recently engaged a national recruiting firm, increased our in-house recruiting efforts, and hired a national vice-president of sales, all of which we expect will yield significant improvements in the months ahead.
However, previous efforts to accomplish our salesforce goals have meaningfully lagged our expectations, resulting in a negative impact on our revenue. While 3rd quarter 2016 results are not yet final, preliminary data has led the General Partner and the Board of Directors to temporarily reduce the quarterly cash distribution to $0.33 per unit. This distribution level, along with previously announced cost savings measures totaling $7 million annually, will enhance StoneMor’s liquidity by approximately $12 million in quarterly cash savings.”
Robert B. Hellman, Jr., lead director of the Board of Directors and Chairman of the General Partner, added, “The General Partner strongly believes that this reduction, while disappointing, will protect and position the Partnership to achieve our longer-term expectations for future growth of the business. During this temporary transition period, the General Partner remains committed to providing necessary resources and support to the Partnership, including the funding of acquisitions that are immediately cash accretive, while it strengthens its sales force.”
The 3rd quarter 2016 cash distribution is payable on November 14, 2016 to common unit holders of record as of the close of business on November 7, 2016.
StoneMor Partners, an owner and operator of cemeteries and funeral homes in the United States, currently has a 9.6% dividend yield.
Larry Miller, President and CEO of StoneMor, commented, “As previously discussed, we are working to re-grow our sales force, increasing both its quality and size. To accomplish this, we have recently engaged a national recruiting firm, increased our in-house recruiting efforts, and hired a national vice-president of sales, all of which we expect will yield significant improvements in the months ahead.
However, previous efforts to accomplish our salesforce goals have meaningfully lagged our expectations, resulting in a negative impact on our revenue. While 3rd quarter 2016 results are not yet final, preliminary data has led the General Partner and the Board of Directors to temporarily reduce the quarterly cash distribution to $0.33 per unit. This distribution level, along with previously announced cost savings measures totaling $7 million annually, will enhance StoneMor’s liquidity by approximately $12 million in quarterly cash savings.”
Robert B. Hellman, Jr., lead director of the Board of Directors and Chairman of the General Partner, added, “The General Partner strongly believes that this reduction, while disappointing, will protect and position the Partnership to achieve our longer-term expectations for future growth of the business. During this temporary transition period, the General Partner remains committed to providing necessary resources and support to the Partnership, including the funding of acquisitions that are immediately cash accretive, while it strengthens its sales force.”
The 3rd quarter 2016 cash distribution is payable on November 14, 2016 to common unit holders of record as of the close of business on November 7, 2016.
StoneMor Partners, an owner and operator of cemeteries and funeral homes in the United States, currently has a 9.6% dividend yield.
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