Fresh Del Monte’s stock tumbles after dividend suspended
Shares of Fresh Del Monte Produce Inc. dropped 1.7% after resuming trade Wednesday, after the fruit and vegetable producer said it will suspend its quarterly cash dividend, “in light of the terms of the company’s credit facility.” The stock’s selloff comes after it plunged 17% on Tuesday following the release of fourth-quarter results. The stock’s previous quarterly dividend was 15 cents a share, with the annual rate of 60 cents a share implying a dividend yield of 2.05% at Tuesday’s closing price. “Our current credit facility imposes certain operating and financial restrictions on us,” the company stated in its 10-K filing with the SEC. “Our failure to comply with the obligations under this facility, including maintenance of financial ratios, could result in an event of default, which, if not cured or waived, would permit the lender to accelerate the indebtedness due under the facility.” The stock has now tumbled 36.7% over the past 12 months while the S&P 500 has gained 2.5%.
Source : MTV
