Denbury Announces Suspension of Dividend
21 September 2015 - 9:00PM
Denbury Resources Inc. (NYSE:DNR) (“Denbury” or the “Company”)
today announced that its Board of Directors has decided to suspend
the Company’s current $0.0625 per share quarterly cash dividend,
beginning with the fourth quarter of 2015. The Company will
pay its previously announced third quarter cash dividend on
September 29, 2015.
By suspending the dividend, the Company will free up
approximately $22 million of cash each quarter, or $88 million
annually, which can be directed to other uses including, among
other things, debt reduction, increases in capital spending, or
repurchases of shares of the Company’s common stock.
Separately, the Company’s Board of Directors has reinstated
the ability for the Company to repurchase shares under its
previously authorized share repurchase program which was suspended
in November of 2014. Under that program approximately $222
million remains authorized, with no set expiration date and no
requirement that the authorized amount be used in whole or in
part.
Phil Rykhoek, Denbury’s President and Chief Executive Officer,
commented, “While we believe that our assets are a great fit for a
long-term growth and income strategy, the current low oil price
environment and our desire to maintain financial strength and
flexibility have led us to conclude that suspension of our dividend
is appropriate at this time. Although our oil commodity
hedges and proactive reduction in capital spending have buffered us
to a large degree from this oil price downturn, the benefit from
our hedges will begin to diminish in the fourth quarter of
2015. We expect to reinstate a dividend in the future, but
the timeline for doing so is uncertain and will likely be highly
dependent on oil prices. We remain focused on reducing costs
and further optimizing our business to ensure that Denbury emerges
from this downturn a much stronger company.”
Denbury is an independent oil and natural gas company with
operations focused in two key operating areas: the Gulf Coast and
Rocky Mountain regions. The Company’s goal is to increase the
value of its properties through a combination of exploitation,
drilling and proven engineering extraction practices, with the most
significant emphasis on carbon dioxide enhanced oil recovery
(“CO2 EOR”) operations. For more information about
Denbury, please visit www.denbury.com.
DENBURY CONTACTS:
Mark C. Allen, Sr. Vice President and Chief Financial Officer, 972.673.2000
Ross M. Campbell, Manager of Investor Relations, 972.673.2825
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