Host Hotels & Resorts, Inc. HST announced a temporary suspension of the quarterly cash dividend, starting with the June-end quarter dividend that would have been paid out in July 2020.
The company anticipates this to preserve around $140 million of cash during the April-June period.
Earlier, it paid out a dividend of 20 cents per share on Apr 15 to stockholders of record s of Mar 31, 2020.
Per management, the decision to suspend the quarterly dividend comes as a measure to preserve liquidity and maintain balance sheet flexibility. Nonetheless, the board will continue to keep an eye on the company’s financial performance and operating scenario to decide the correct time to restart dividend payments.
Notably, it has been making efforts to improve its liquidity to navigate the impact of business challenges posed by the pandemic. In fact, during the first quarter, it drew down the entire $1.5-billion capacity on its revolver in a bid to boost the cash position. Additional measures to improve liquidity included reductions in corporate expenses by 10-15%, capital expenditure reduction by $100-$125 million and temporary suspension of future stock repurchases.
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