This study explores whether payout reductions represent an alternative source of investment funds. We focus on the distinct, financially constrained maritime sector and draw a sample of 1863 firm-year observations from 143 globally-listed maritime firms during 1987-2020. Investigating the payout reduction-investment nexus, we document a positive relationship that surfaces in recession periods. Our findings indicate that payout reductions represent a source of funds for maritime firms in times of negative external financing shocks.