Transport companies exposed to the container shipping industry, namely liners, container owners, and charter owners/managers; have experienced financial challenges and burdens driven by the overcapacity issues for container ships.
Many companies in this segment, including Textainer, have provided dividend payouts for shipping investors. Typically, dividend yields have been higher than average based upon the risks associated within the industry. Today's climate has witnessed dividend cuts by the two largest container owners and managers in the world.
Textainer has taken an ever more drastic approach to cutting the dividend, lowering the amount per share the company' pays out from $1.65 at year-end 2015 to $0.12 as of the next twelve-month period (2016-2017). This will reduce Textainer's payout from $13.5 million to $1.7 million, saving nearly $12 million per quarter, or roughly $45 million for the next year. Albeit painful for investors, this action has provided the company with more flexibility in the near-term.