Shares of Office Properties Income Trust (OPI) experienced a significant drop early on Thursday, following the company's decision to cut its dividend for the second time in less than a year. The stock was down by 12% to $5.45 in premarket trading, contributing to a total decline of 64% over the past 52 weeks as of Wednesday's close.
OPI, a real-estate investment trust, has reduced its dividend by 96% to just 1 cent per share. This decision comes after a previous dividend cut of over 50% in April. Yael Duffy, the Operating Chief of OPI, explained that market conditions for the company have continued to deteriorate since the last dividend reduction.
Duffy stated, "We believe it is prudent to further reduce the dividend to increase our liquidity and financial flexibility when addressing future leasing costs, capital expenditures, and debt maturities." OPI expects the new dividend to result in an additional $47 million in liquidity per year.
As OPI takes strategic measures to adapt to challenging market conditions, investors will closely monitor the company's ability to manage leasing costs, capital expenditures, and debt obligations effectively.