CONCEPCION Industrial Corp. (CIC) is buying back up to P100 million worth of common shares over the next three years.
In a disclosure to the stock exchange, CIC said its board of directors approved the share buyback program “to provide price support for its shares and enhance share value.”
The buyback program will start today (Sept. 10) and will end on Sept. 9, 2022.
“The company shall be authorized to repurchase up to One Hundred Million Pesos (P100,000,000.00) worth of common shares during the first year, and up to an aggregate of 12,000,000 common shares cumulatively over a three-year period, representing approximately 3% of the company’s current common market capitalization,” CIC said.
CIC said it will use internally generated funds for the share buyback program.
The company said the buyback program is not seen to negatively affect its ability to fund any of its planned and existing projects and investments. It will also “not involve active and widespread solicitation from stockholders in general.”
The share buyback program will be executed through the open market.
For the first six months of 2019, CIC reported its net income attributable to owners of the parent stood at P486.52 million, 14% lower than the P566.9 million recorded during the same period a year ago.
“(Second quarter) was a challenging quarter for growth in consolidated income coming off a high base in 2018 (2017-2018 was at 16.3% growth) but also affected by factors including overall pipeline slowdown in the commercial segment, aggressive competition, as well as supply chain and aftermarket cost challenges,” the company said.
“Operational challenges in logistics due to port congestion, excess inventory and warehouse demand, as well as in aftermarket from CRM transition issues and call center pricing are the key drivers for the decrease in profit in addition to lower commercial segment sales,” it added.
Incorporated in 1997, CIC is the company behind air-conditioners and refrigerators under the Carrier, Toshiba, Condura, and Kelvinator brands.