In an effort to conserve cash, Fleetwood Enterprises Inc. announced it will discontinue common stock dividend payments and defer payments on its 6% Convertible Trust Preferred Securities.
The moves will save Fleetwood $5.6 million per quarter, according to the company.
Fleetwood will make a previously announced dividend payment on Nov. 14, but it will suspend dividend payments after that.
A quarterly payment to the trust preferred securities holders was to be made on Nov. 15, but Fleetwood now believes current RV and manufactured home market and economic conditions will require it to defer that payment and at least two more quarterly payments.
Fleetwood will eventually be required to pay the principal and interest on the trust preferred securities plus accrued interest during the period that the payments are deferred.
Fleetwood can suspend payments to trust preferred securities holders for up to 20 consecutive quarters.
“These measures, along with our existing bank line and our recent $20 million private placement of equity will help provide additional liquidity to serve the best long-term interests of the company and our shareholders,” said Nelson Potter, president and CEO.