Unlocking Shareholder Value: A Closer Look at 14 Industrial Companies Implementing Stock Buybacks Last Quarter Q2 FY 2023
Buybacks
July 10, 2023
Euro Tech Holdings Company Limited (CLWT) recently authorized a stock buyback program, demonstrating its confidence in the company's future prospects. The Board of Directors has approved the repurchase of up to 230,000 shares of its outstanding ordinary shares, totaling a maximum purchase price of $300,000. This allows the company to buy back shares either in the open market or through negotiated transactions over the next year, taking advantage of favorable market and business conditions.
The decision to authorize the stock buyback stems from the Board's belief that the current stock price does not accurately reflect the company's potential and is considerably lower than its net asset value per share. By repurchasing shares, Euro Tech Holdings aims to enhance shareholder value and capitalize on this discrepancy between stock price and underlying value.
Performance Shipping Inc. (PSHG), a leading global shipping company specializing in tanker vessels, has recently announced its approval of a share repurchase plan. The Board of Directors has authorized the repurchase of up to US$2.0 million of the company's outstanding common shares, which represents approximately 21% of the market capitalization as of April 3, 2023. This decision comes in response to several factors impacting the capital markets, including rising interest rates, global economic uncertainty, and a recent banking crisis.
Andreas Michalopoulos, the CEO of Performance Shipping Inc., emphasized the importance of capital allocation strategy and the shareholders' interest. With a robust balance sheet and a positive long-term outlook on the tanker market, the company intends to invest opportunistically, including through share buybacks under favorable conditions. The share repurchases will be conducted at management's discretion, taking into account factors such as attractive prices, general market conditions, applicable securities laws, and the company's financial performance.
It's worth noting that the company may execute these repurchases under Rule 10b-18 of the Securities Exchange Act of 1934 or pursuant to a trading plan adopted in accordance with Rule 10b5-1 of the same Act. The share repurchase plan is subject to various factors and may be suspended, terminated, or modified at any time, depending on market conditions, cost considerations, alternative investment opportunities, liquidity, and other relevant factors. The authorization for the plan is effective immediately and valid until March 31, 2024.
GEE Group Inc. (JOB) recently announced its authorization of a share repurchase program, allowing for the repurchase of up to $20 million worth of the company's outstanding shares of common stock. This decision reflects the company's commitment to balanced capital deployment, long-term growth, and maximizing returns for its shareholders. Derek Dewan, Chairman and CEO of GEE Group, emphasized the belief that the company's business model and strong cash flow generation make it well-positioned for both strategic investments and the opportune buyback of undervalued shares.
The share repurchase program will be executed through open market purchases, following the guidelines set by the Securities Exchange Act of 1934. GEE Group plans to fund the program using operating cash flow and available cash on hand, which amounted to approximately $20 million as of March 31, 2023. The timing and extent of the repurchases will depend on various factors, including market conditions, regulatory requirements, and the company's own trading window. It is important to note that the share repurchase program will run until December 31, 2023, and may be suspended or discontinued at any time. While there is no obligation to repurchase a specific number of shares, GEE Group's Board of Directors holds the option to authorize a new program in the future.
Core & Main Inc., a leading infrastructure company, has announced an underwritten secondary public offering of 14 million shares of its Class A common stock by certain selling stockholders. The company itself will not offer any shares in this offering and will not receive any proceeds from it. The offering, subject to market conditions, marks an important step for the company's growth.
Alongside the offering, Core & Main plans to repurchase and redeem approximately 3.1 million shares of its Class A common stock and a corresponding number of partnership interests of its subsidiary, Core & Main Holdings, LP. The repurchase will be at the same per share price as offered by the underwriter in the public offering. The completion of the repurchase is contingent upon the closing of the offering, which is being underwritten by J.P. Morgan Securities LLC.
REV Group, Inc., a leading manufacturer of specialty vehicles, recently reported its second-quarter results, which showed a significant increase in consolidated net sales compared to the same period last year. The company's net income and adjusted EBITDA also saw substantial growth. The positive performance was attributed to improved operational consistency, increased starts and completions, and strong revenue and earnings growth in the Recreation segment. In light of these favorable results and raised full-year outlook, REV Group's board of directors authorized a stock buyback of up to $175.0 million, replacing the previous program. This new authorization provides management with flexibility to repurchase shares over the next 24 months, enhancing shareholder value and reflecting confidence in the company's prospects.
The company's Fire & Emergency segment experienced increased net sales and backlog due to higher shipments of fire apparatus and ambulance units, improved supply chain and labor efficiencies, and pricing actions. The Commercial segment also saw a rise in net sales, driven by higher shipments of various vehicles and improved supply chain performance. The Recreation segment reported increased net sales, although its backlog decreased due to increased unit production and order normalization. Despite challenges in the industry, REV Group's overall performance demonstrated positive momentum and growth.
Startek, Inc., a global customer experience solutions provider, has recently announced a revised repayment schedule for its senior debt facility and a further reduction of its revolving credit facility. To bolster its financial position, the company has authorized a stock buyback program of $20 million. This decision comes after Startek generated $55 million in proceeds from divesting its interest in Contact Center Company (CCC). $7 million was allocated towards the repayment of the revolving credit facility, while $48 million went towards prepayments on the senior term loan. As a result, the company's outstanding repayment obligations have been significantly reduced, providing greater liquidity and improving the overall health of its balance sheet.
According to Bharat Rao, Global CEO of Startek, the recent divestitures have allowed the company to substantially reduce its debt by approximately 60% during the first four months of 2023. This move is favorable given the current interest rate environment, as it reduces the burden of interest costs. The repayment schedule amendments and reduction of the revolving credit line not only enhance the balance sheet but also provide long-term liquidity for the company. In light of these de-leverage initiatives, Startek's board of directors has authorized the repurchase of company shares worth $20 million. The share repurchase program will be executed based on market conditions, prevailing stock prices, and other considerations. The company aims to utilize this program to take advantage of what it sees as an attractive investment opportunity in its own shares, ultimately driving long-term shareholder value.
Trex Company, Inc., known as the world's leading brand in eco-friendly composite decking and outdoor living products, recently released its first quarter 2023 results. Despite a decrease in net sales compared to the previous year, the company achieved a gross margin of 39.6% and net income of $41 million. Bryan Fairbanks, the President and CEO of Trex, attributed their success to the broad appeal of their product line and the sustained popularity of outdoor living. Trex's strong brand, efficient manufacturing, and partnerships with top industry channel partners contributed to their industry-leading margins and profitability.
In light of their financial strength and confidence in long-term prospects, Trex's Board of Directors authorized a new stock buyback program, allowing for the repurchase of up to 10.8 million shares of common stock. This decision reflects the company's commitment to creating shareholder value. Trex has a positive outlook for 2023, with expected second quarter net sales ranging from $310 million to $320 million and an estimated full-year EBITDA margin of 26% to 27%. Capital expenditures for the year will primarily focus on the construction of their Arkansas facility, tailored to market demand trends. Trex's consistent recognition as a top brand in the industry further solidifies its position as a trusted and sustainable leader in composite decking.
Matson, Inc., a leading U.S. carrier in the Pacific, recently authorized the addition of three million shares to its existing share repurchase program, bringing the total program to twelve million shares. The program has been extended until December 31, 2025. This decision reflects the company's commitment to returning excess cash to shareholders and creating long-term shareholder value. Additionally, Matson's Board of Directors declared a second quarter dividend of $0.31 per common share, which will be paid on June 1, 2023. The company has already repurchased approximately 8.3 million shares since the launch of the program in August 2021, amounting to nearly $650 million in total costs. Matson will continue to assess its capital needs, market conditions, and the market price of its common shares to make strategic repurchases in the open market. The repurchase program may be suspended or discontinued at any time. Overall, this stock buyback authorization showcases Matson's disciplined and opportunistic approach to capital allocation.
WillScot Mobile Mini Holdings Corp., a leading provider of flexible space and storage solutions in North America, recently announced that its Board of Directors has authorized a stock buyback program worth $1.0 billion, effective from May 3, 2023. This decision reflects the company's commitment to its capital allocation framework outlined during its Investor Day in November 2021.
According to Brad Soultz, the Chief Executive Officer, the company's strong cash flow has allowed them to prioritize three key areas. Firstly, they will continue to invest in organic growth initiatives, leveraging their $1 billion portfolio of growth opportunities. Secondly, they plan to pursue strategic and value-enhancing acquisitions. Lastly, the company aims to maintain a healthy balance sheet while providing returns to shareholders. In the past year leading up to March 31, 2023, WillScot Mobile Mini has repurchased 22.4 million of its common shares for $895 million, resulting in a 9.5% reduction in the overall share count and delivering significant economic benefits to shareholders.
HireRight Holdings Corporation (NYSE: HRT), a leading provider of background screening services, recently authorized an additional $25 million share repurchase program. This move by the Company's Board of Directors reflects their confidence in the company's financial position and growth prospects. The repurchase program allows HireRight to buy back shares of its common stock through various means, such as open market repurchases or privately negotiated transactions. The timing and number of shares repurchased will depend on factors like stock price, trading volume, and market conditions. The company had approximately $82.2 million in cash and cash equivalents as of June 20, 2023, which will be used to fund the repurchases.
This new program follows a successful $100 million share repurchase program that was announced in November 2022 and completed on June 22, 2023. During that program, HireRight repurchased a total of 9.3 million shares at an estimated average price of $10.80. The previous program's success likely contributed to the decision to authorize another round of share repurchases, demonstrating the company's commitment to returning value to its shareholders.
MYR Group Inc., a leading electrical contractor in the United States, has recently announced the authorization of a new $75 million share repurchase program. The decision to implement a stock buyback reflects the company's commitment to delivering long-term value to its shareholders. Rick Swartz, President and CEO of MYR Group, emphasized the company's confidence in its market opportunity and its strategy for long-term growth.
Ryerson Holding Corporation (RYI) recently made an important announcement regarding its principal shareholder, an affiliate of Platinum Equity LLC. The affiliate has initiated a secondary offering of 2,630,700 shares of Ryerson's common stock, for which they will receive all net proceeds. However, what stands out is that Ryerson itself has authorized a share repurchase agreement with the selling stockholder. The company plans to repurchase 1,369,300 shares of its common stock directly from the selling stockholder, utilizing its cash reserves to fund the repurchase. This move is expected to coincide with the closing of the offering. J.P. Morgan is serving as the sole underwriter for the offering and may sell the purchased shares at market or negotiated prices. This recent development indicates Ryerson's confidence in its stock and financial position, as well as its commitment to enhancing shareholder value.
The decision to authorize a stock buyback suggests that Ryerson Holding Corporation believes its shares are undervalued and seeks to increase shareholder returns. By repurchasing its own stock, the company reduces the number of outstanding shares, effectively consolidating ownership and distributing more earnings to shareholders. With J.P. Morgan as the underwriter, Ryerson aims to efficiently execute the offering and subsequent repurchase. Investors can access additional details and relevant documentation through the Securities and Exchange Commission's website or by contacting J.P. Morgan directly.
Graham Holdings Company (GHC) recently made an important announcement regarding its stock buyback program. The company's Board of Directors has authorized the acquisition of up to 500,000 shares of its Class B common stock. This decision signifies the company's intention to repurchase a portion of its outstanding shares from the market. As of April 28, 2023, there were 3,778,767 Class B shares outstanding.
Gates Industrial Corporation plc (GTES) recently made an announcement regarding a secondary offering of its ordinary shares. The offering, totaling 22,500,000 shares, is being conducted by certain selling stockholders affiliated with Blackstone Inc. Alongside this, Gates has authorized a share repurchase program worth $250 million, which involves the repurchase of ordinary shares from Citigroup Global Markets Inc., who will acquire these shares from the selling stockholders. It is important to note that Gates will not be offering any shares in the secondary offering and will not receive any proceeds from it.
The decision to authorize the stock buyback and conduct the secondary offering may be influenced by various factors. The share repurchase program allows Gates to buy back its own shares at a price per share equivalent to the underwriters' purchase price in the secondary offering. This indicates the company's confidence in the value of its stock and its desire to support shareholder returns. Additionally, the secondary offering provides an opportunity for the selling stockholders to monetize their investments in Gates.
All data was sourced from LevelFields AI
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