Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Mighty River Power announces share buyback programme

News Release
10 October 2013

Mighty River Power announces share buyback programme

Mighty River Power has today announced that it will begin an on-market share buyback programme to purchase up to $50 million worth of shares as part of its capital management plans – reflecting the Board’s view that the purchase of its own shares is in the best interests of the Company and its shareholders.

Mighty River Power Chair, Joan Withers, said the Board believed that the buyback, representing less than 2% of the Company’s shares, was a prudent use of capital.

The purchase of up to 25 million ordinary shares may occur from 15 October 2013 and may continue until 14 October 20141.

“One of the Board’s priorities as a listed company is maintaining an ongoing review of capital management as Mighty River Power transitions out of a period that involved significant capital investment.

“The Board’s view is that a purchase of our shares, at this time and at current market prices, provides a return above the Company’s cost of capital and will be value-enhancing for our shareholders. It is also preferable at this point in time to the other tools we have available to us such as a special dividend or a change in dividend policy.”

Mrs Withers said the Board had taken into account the Company’s out-performance against the FY2013 IPO forecast and the approximately $100 million lower than forecast capital expenditure in FY2013, which resulted in a stronger than expected year-end balance sheet, and the lower capital expenditure now planned for FY2014.

“We will be continuing to monitor capital management, taking into account the cash flows from our new Ngatamariki geothermal station and the Board’s commitment to maintain the Company’s current credit rating. Currently our dividend policy and IPO forecast provide for a 1 cent per share (8.3%) increase in fully imputed dividend from FY2013 to FY2014 to 132 cents per share (representing 71% of Free Cash Flow3 and a gross dividend yield of 8.2% at market close 9 October 2013).”

Mighty River Power is forecasting an interim dividend of $72.8 million which equates to 5.22 cents per share to be paid in March 2014.

1 Ordinary shares bought back will not be cancelled and will be held by the Company (as treasury stock).
2 Dividend payment in cents per share based on the number of ordinary shares currently on issue of 1,400,000,094.
3 Free Cash Flow is net cash provided by operating activities less re-investment capital expenditure (including accrued costs). Free Cash Flow is used by the Company as a measure of the level of cash available for debt repayments, growth capital expenditure and dividends.

ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Auckland Port Study: Port To Ship Out – No Departure Date

Interest groups in Auckland and its waterfront chose a group of representatives to determine the future of the port. Their consensus is that the Port is going to have to move but not before a credible location is confirmed... More>>

ALSO:

Tax: GST Threshold For Online Purchases Won't Lower Before 2018

The government wants to lower the threshold on online purchases which qualify for GST from mid-2018, but says more work is needed and there will be no change without public consultation. More>>

ALSO:

North Canterbury: Government Extends Drought Classification

The government has extended a drought classification for the eastern South Island until the end of the year, meaning the area will have officially been in drought for almost two years, the longest period for such a category. More>>

ALSO:

Negotiations Fail: Christchurch Convention Centre Build To Proceed Without PCNZ

After protracted negotiations, the government has ditched the construction consortium it picked to build Christchurch's replacement convention centre, which it now anticipates delivering at least two years behind the original schedule. More>>

ALSO:

Other Centres' Convention Centres:

Ruataniwha: Greenpeace Launches Legal Challenge Against $1b Dam Plan

Greenpeace NZ is launching a legal challenge against a controversial plan to build a dam that’s set to cost close to $1 billion and will pollute a region’s rivers. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news