CALGARY, Alberta, March 3 (Reuters) - Units of Harvest Energy Trust HTE_u.TO plunged as much as 14 percent on Tuesday after the company cut its monthly payout to investors by 83 percent to cope with falling oil and natural gas prices.
Units in the trust, which produces oil and gas in Western Canada and operates a refinery in Newfoundland, fell 48 Canadian cents, or 8.7 percent, to C$5.02 early on Tuesday on the Toronto Stock Exchange after touching as low as C$4.75 in the first few minutes of trading.
The trust said late on Monday that it would cut its monthly distribution to unitholders to 5 Canadian cents from 30 Canadian cents.
The cut came even as it said it returned to a fourth quarter profit, reporting net income of C$78.6 million ($61 million), or 50 Canadian cents per unit, up from a year-earlier loss of C$113.6 million, or 77 Canadian cents a unit, when it was completing a major turnaround at its refinery.
Cash flow, used to fund distributions to investors, more than doubled to C$183.7 million, or C$1.10 a unit.
Harvest said it cut its payout to conserve cash as oil and gas prices remain low after plunging last year as the recession cut demand. It will also cut 2009 capital spending on its oil and gas production business by 37 percent to C$170 million, while spending on its refinery will drop 11 percent to C$50 million.
$1=$1.29 Canadian Reporting by Scott Haggett; Editing by Peter Galloway