Chatham Lodging (CLDT) Declares $0.20 Qtr. Dividend; 5.6% Yield; to Boost Payout 5% in FY13, Pay Monthly

December 4, 2012 8:51 AM EST
Chatham Lodging Trust (NYSE: CLDT) declared a quarterly dividend of $0.20 per share, or $0.8 annualized.

The dividend will be payable on January 25, 2013, to stockholders of record on December 31, 2012, with an ex-dividend date of December 27, 2012.

The annual yield on the dividend is 5.6 percent.

In addition, Chatham’s board voted to raise the dividend in 2013 by five percent, to an annual rate of $0.84 per share, and to convert the company’s current quarterly dividend to a monthly dividend of $0.07 per share beginning in January 2013. “Our goal is to build a superior portfolio of investments that will appreciate in value and generate an attractive and dependable dividend over time for our investors,” said Jeffrey H. Fisher, Chatham’s chief executive officer and president. “Since modern-day hotel REITs were launched in the early 1990’s, shareholder returns have been driven predominantly by dividends. We haven’t lost sight of that, and Chatham offers the right platform to provide meaningful income to our shareholders.

“Our platform uses reasonable leverage and a healthy balance sheet to build a portfolio of investments focused in select-service hotels, and with our aggressive asset management, produces strong cash flow, industry-leading operating margins and most importantly sustainable dividends,” Fisher noted. “We have grown our annual dividend from $0.35 in 2010 to $0.78 in 2012 and at least $0.84 in 2013, reflecting a 140 percent increase. Converting the frequency of our dividends to monthly from quarterly accelerates our shareholders’ returns and value.”

The planned schedule for Chatham’s 2013 monthly dividends will be a record date of the last day of each month, to be paid on the last Friday of the succeeding month. The January common stock dividend will be paid on February 22, 2013 to shareholders of record January 31, 2013. The company will evaluate and adjust its dividend on a monthly basis.

“We have renovated most of our portfolio in the last two years and our portfolio is in excellent competitive condition,” commented Dennis M. Craven, Chatham’s chief financial officer. “As a result, we expect our properties to generate excellent free cash flow which allows us to reward our shareholders monthly with higher dividends. The change in payment schedule and increased pay-out reflect our board’s positive outlook for Chatham and the hotel industry.”

Additionally, the company announced that it expects to establish a direct stock purchase plan and dividend reinvestment plan for its shareholders in 2013.

For a dividend history and other dividend-related data on Chatham Lodging Trust (CLDT) click here.

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