Hawaiian Electric Industries Inc. (HE, -2.06%) announced on Thursday that it will be suspending its dividend starting in the third quarter in order to “further increase its cash position.” The decision to suspend the dividend will allow the company to allocate more funds towards “rebuilding and restoring power” and ensure a strong future for the utility.
As per contract obligations, the utility was originally scheduled to pay a cash dividend of 36 cents per share on September 8th. This dividend was declared on August 3rd, just a few days before the devastating blazes that struck the Maui town of Lahaina and other parts of the island.
The company emphasized their commitment to investigating the cause of the fires, stating that they are working closely with the county, state, and federal governments to determine what happened during this “extraordinary climatological event” on August 8th. They expressed their determination to focus on the restoration, recovery, and rebuilding efforts in their communities, while cautioning against those looking to exploit the situation for speculation and opportunism.
Earlier on Thursday, Maui County took legal action against Hawaiian Electric by suing them over the fires. The county claims that the utility failed to shut off power despite unusually high winds and dry conditions. As a result of these developments, the company’s stock dropped by 6% in after-hours trading, following a 2% decline during regular trading hours.