MIC reestablishes dividend

Macquarie’s New York Stock Exchange-listed infrastructure fund has reinstated a dividend of $0.20 per share. MIC also said it entered into arbitration on 18 April with a co-investor in MIC’s subsidiary, International-Matex Tank Terminals.

Macquarie Infrastructure Company (MIC), Macquarie’s New York Stock Exchange-listed infrastructure fund, has reinstated a dividend of $0.20 per share, and expects to continue to pay the same dividend on a quarterly basis, chief executive James Hooke told investors during a conference call today.

MIC has also entered into arbitration with a co-investor in one of its businesses because of a dispute stemming from dividend payments, Hooke said.

The dispute centers over how much cash International-Matex Tank Terminals (IMTT), MIC’s bulk liquid storage business, should pay to its shareholders. MIC wants to use cash from IMTT to fund part of its quarterly dividend, which was suspended for two years while MIC was de-leveraging its business.

MIC owns 50 percent of IMTT. A trust controlled by the family of IMTT chief executive Thomas Coleman owns the remaining 50 percent.

Hooke said the dispute had not affected discussions about growth expenditures for IMTT. He said the board continued to discuss capital expenditures even after the initiation of arbitration on 18 April, and approved $69 million in growth projects in a meeting last week. Hooke said IMTT was looking at about $200 million in growth expenditures in coming years.

During a February investor conference call, Hooke said MIC’s dividend could rise to 37.5 cents per share if the dispute is resolved.

IMTT's revenue grew 10.9 percent from the first quarter of 2010 to the first quarter of 2011, but its free cash flow declined from $33.5 million to $28.4 million due to increased tax payments, MIC said in a statement. Cash flow also decreased in MIC’s District Energy and Gas Company businesses. Cash flow at Atlantic Aviation, which owns and operates aircraft fueling and servicing stations at airports across the US, increased from $13.4 million to $16.4 million, MIC said.

MIC shares were down 0.3 percent on the day’s trading at press time, standing at $25.30.