2023-08-04 09:16:18 ET
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Icahn Enterprises ( NASDAQ: IEP ) stock plummets 31% early Friday, after the company said it’s cutting its quarterly distribution to $1 from $2 previously .
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The investment company, which is owned by Carl Icahn, said that for the second quarter it would pay investors $1 per depositary unit instead of the typical $2 per unit.
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Icahn was making reference to a report written on May 2 by short-seller Hindenburg Researc h that accused IEP, Icahn's investing arm, of overstating asset values. Along with other things, Hindenburg disclosed that Icahn had taken a loan from the business.
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“I believe the second quarter partially reflected the impact of short selling on companies we control or invest in, which I attribute to the misleading and self-serving Hindenburg report concerning our company, Icahn said in a statement.
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“It also reflected the size of the hedge book relative to our activist strategy.”
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"IEP has issued distributions for 73 continuous quarters. We do not intend to let a misleading Hindenburg report interfere with this practice. This quarter, IEP is declaring a $1.00 per depositary unit distribution, which represents a 12% annualized yield based on yesterday's closing price and unitholders will continue to have the right to elect whether to receive cash or additional depositary units," he added.
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IEP said it had a loss of $269 million, or 72 cents per depositary unit, for the second quarter, wider than the loss of $128 million, or 41 cents per depositary unit, posted in the year-earlier period.
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Revenue fell to $2.684 billion from $3.796 billion.
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Adjusted EBITDA attributable to Icahn Enterprises was $34 million compared to $126 million during the prior year period.
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Dig into the company's earnings presentation .
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Icahn Enterprises looked at asset swaps, fundraising before short call - report
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Icahn Enterprises stock slides 33% after company halves quarterly distribution to $1 per unit