Dividends are technically paid out of retained earnings. From what I see the retained earnings is close 390+ mill. Dividends paid last year was 116 mill. So they can pay div and still have some left over to add to the RE. From a cash flow perspective things look ok too.
If earnings were to go -10%, I don't think the board would panic and lower the div unless they thought this drop will be sustained for an indertiminate amount of time. Companies that pay divs are very loath to cut div's. Merck is a good exampe. I think they just raised their div despite current problems.
I hold this stock and I like the div, but when I invest for div's I also try to find companies that have a decent potential for capital appreciation.
I've only held GXP for about 7 months now, and I admit it's been frustrating.
yahoo key statistics shows gxp earnings for the last 12 months @ $1.84 per share. dividend at $1.66 per share makes for a 90% payout. if we get a normal summer i expect that earnings will improve. at this point i feel the board will maintain the current dividend. just my humble opinion.