Oilfield services provider Halliburton (HAL) - Get Report on Wednesday slashed its quarterly dividend by 75%, the latest in a string of cost-cutting moves to cope with the dramatic plunge in oil prices that began in March.
In a statement following its annual shareholders' meeting, the Houston-based company said its board of directors had approved setting a dividend of 4.5 cents a share payable on June 24, down from 18 cents a share paid on March 25.
"The decision to set the quarterly dividend at a lower level reflects the current market conditions and uncertainties regarding the depth and duration of this downturn," Halliburton said.
“Halliburton continues to take measures to strengthen our liquidity and financial resilience under the current circumstances,” CEO Jeff Miller said in the statement. “Today’s dividend announcement reflects our commitment in the near term to deliver shareholder returns while maintaining a strong liquidity position.”
The move comes following an unprecedented drop in oil prices, sparked in part by the coronavirus pandemic and shutdown of economic activity globally, though augmented by the since-tentatively-resolved price war between Russia and Saudi Arabia that fueled one of the biggest supply guts in history, pushing per-barrel oil prices to record lows.
Halliburton last month reported a loss of $1 billion, or $1.16 a share, for the first quarter, down from a profit of $152 million, or 17 cents a share, during the same period a year ago.
Halliburton said it has implemented a $1 billion action plan to reduce overhead and other costs, lowered capital expenditures by roughly 50% from 2019 levels, and fast-track its efforts to improvement on its oil delivery services,” Miller said. The company also announced that annual retainers for its board of directors will be cut by 20%.
Shares of Halliburton were up 4.66% at $11.67 in trading Wednesday.