Seaworld shares opened at an all-time low of $11.77 after it announced plans to cut and then scrap its dividend.
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SeaWorld Entertainment Inc. on Monday slashed its quarterly dividend and said it would suspend future payments, six months after the company chose to stop breeding killer whales at its theme parks.
Shares of SeaWorld Entertainment Inc. fell 76 cents, or 6 per cent, to $11.93 in afternoon trading Tuesday.
“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”.
About 3.66 million shares of SeaWorld have been traded so far today vs. its average trading volume of roughly 1.46 million shares per day. Doing so will give us the greatest flexibility to deploy capital to the opportunities that offer the greatest long term returns to our shareholders.
The company said in March it would stop breeding killer whales, and those now at its parks would be the last.
Macquarie Research analyst Matthew Brooks, who said last month that he believed SeaWorld’s dividend was “too high”, wrote Tuesday: “We also think investing in new rides and attractions might be a better use of capital than buybacks”.
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This marks yet another shift for the troubled entertainment company that has been plagued by backlash stemming from the 2013 documentary Blackfish that detailed the firm’s treatment of its signature orcas. In the second quarter, attendance was down 494,000 guests, SeaWorld told investors in August.
