SeaWorld Entertainment Inc’s share price sinks as group calls halt to dividend breeding programme
SeaWorld investors weren't having a whale of a time today as the company's stock sunk 6.15 per cent in pre-market trading after it slashed its dividend by more than half.
In a statement yesterday, SeaWorld Entertainment Inc said its dividend payout was plunging in depth to 10 cents per share, down from 21 cents per share previously.
Instead of issuing a higher dividend, the beleaguered company will instead redeploy capital to shareholders by "opportunistically repurchasing the company's shares in the open market" for the remainder of 2016.
SeaWorld's board said it has also floundered on its quarterly dividend breeding programme, which it will suspend.
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"We believe our five-point strategy to stabilise the business to drive sustainable growth is taking hold, and we are optimistic about SeaWorld's long-term future," said president and chief executive Joel Manby.
"After careful and thorough deliberation, the board has determined that, consistent with the financial discipline pillar of the company's strategy, the best way to support the long-term development of the business and deliver value to shareholders is to suspend future dividends at this time."
Its shares were trading at $11.91 per share before the market opened in New York, at 2.30pm London time.
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In April, SeaWorld said it will stop breeding killer whales in captivity, bowing to pressure from animal rights activists and a tidal wave of criticism against its treatment of animals within its parks since the release of Gabriella Cowperthwaite's 2013 documentary Blackfish.
The documentary told the story of Tilikum, a captive orca at the company's San Diego site who has killed several people, including trainer Dawn Brancheau in 2010.
Although SeaWorld denied many of the film's claims, its share price and profits have failed to recover since falling drastically in 2014.
Last month, it missed earnings expectations for the eleventh consecutive quarter.