GDF Suez Cuts Dividend Following Last Year's Writedowns
The payout of 0.5 euros a share will be given to shareholders in October, the company said today in a statement. The utility paid a total of 1.50 euros a share last year.
Chief Executive Officer Gerard Mestrallet has called the slump in European demand for power and natural gas “serious and long-lasting.” GDF Suez took impairments of 9.1 billion euros, mostly on European power assets, and goodwill of 5.8 billion euros for 2013.
The Courbevoie-based company, which operates installations from atomic reactors in Belgium to offshore gas platforms, has been hurt by lower demand for gas-fired power during Europe’s economic decline, leading it to close or mothball more than 11,000 megawatts of capacity. Mestrallet has sought to expand in Asia, Latin America and the Middle East to counter the slowdown.
The utility confirmed today it would pay a minimum of 1 euro a share in cash for the years 2014 to 2016. It also is putting in place a “shareholder loyalty” plan for holders of shares for more than two years.
Mestrallet will waive half of the variable portion of his annual compensation for 2013 due to the “difficult situation” confronting the energy industry, according to the company’s latest annual report released earlier this week.
When so-called performance units, or deferred variable compensation, is included, Mestrallet’s compensation for 2013 will drop to 2.85 million euros from 3 million euros the previous year.
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