GEO Group said it would use the cash from the dividends to repay debt and fund growth opportunities.
Shares of the Boca Raton, Fla., company at last check were off 20% at $6.24. The stock has tumbled 34% over the past 12 months, while the S&P 500 has run up 53.2%. The Real Estate Select Sector SPDR Fund (XLRE) - Get Report is up 26% in the past year.
The company last paid a quarterly dividend of 25 cents a share in January.
GEO Group operates 116 correctional facilities, located mostly in the U.S. but also in Australia, Canada, New Zealand and South Africa. The company offers educational programs, vocational training, and rehabilitation therapy services.
GEO for now will maintain its status as a REIT but the board will assess that question, expecting to finish the evaluation in the fourth quarter.
"[Should] the board determine not to change its current intent to maintain GEO's REIT status, an additional dividend payment may be required before year-end in order to meet the minimum REIT distribution requirements under the [Internal Revenue Service] code," the company said in a statement.
GEO said it had canceled roughly $35 million of capital spending planned for 2021 and had set a goal of repaying at least $125 million to $150 million of net debt during the year.
At March 31, GEO had $291 million of cash on hand and $650 million of combined borrowing capacity and credit.