Before the pandemic's onset, The Walt Disney Company (DIS -0.12%) paid a semi-annual dividend. However, when it was forced to shut its doors to several of its most lucrative businesses worldwide, Disney felt it prudent to pause the dividend payment to conserve cash.

After all, no one knew how long or how severe the pandemic would be, and making sure your corporation had enough money to endure a prolonged shutdown was a reasonable decision. But now, all of its theme parks are open, movies are playing in theaters again, and hotels are hosting guests. All of which have investors asking: When will Disney reinstate its dividend? 

A group of people on a roller coaster going up a hill with their hands up in the air.

 Image source: Getty Images.

Disney's CEO says dividends to return in distant future

According to Disney CEO Bob Chapek, dividends won't be returning anytime soon. Here is what the CEO said at an investor conference recently: 

I think what we're going to do is, number one, our clear priority, and the Board agrees with management, that the clear priority is funding our new growth businesses that we've got. But once we get to a point where, again, our cash flow is funding that, handling some of the debt that we've got, then everyone agrees that it would be a great thing to reinstate that dividend and do share buybacks. But that's sort of in the distant future.

Importantly, in the fiscal three years (2017, 2018, 2019) before the pandemic, Disney paid out cash dividends totaling $2.4 billion, $2.5 billion, and $2.9 billion. That's a lot of cash to shell out. To put those figures into better context, consider that in the most recent nine months ended July 3, Disney has generated $2.9 billion in cash from operations. In other words, Disney has barely earned enough money to match its total dividend payment for fiscal 2019. It's no surprise then that the CEO is hesitant to reinstate the dividend. 

The fact is that while the company's operations are all reopening, they are far from being at full strength. Capacity restrictions remain, folks are still hesitant about leaving their homes, and it takes time to get a business going after putting it on pause. 

Disney shareholders should prepare to wait

The good news for shareholders relying on Disney's dividend is that Chapek said the company's management and the board of directors agree that it would be great to reinstate the dividend. So the question becomes a matter of when, not if. 

For now, shareholders can be pleased with Disney's recovery from the pandemic, it getting all its operations going again, and the incredible success with the expansion of the streaming segment. However, if you're investing in Disney stock primarily for the dividend, be prepared to wait at least several more quarters and perhaps a few more years before those payments start flowing again.