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Dorchester Announces Share Buyback Programme
Media Announcement
28 July 2006
Dorchester Announces Share Buyback Programme
The board of directors of financial solutions group, Dorchester Pacific Limited have today announced a share buyback programme of up to 4% of the Group’s shares.
The buyback will be effected from 2 August 2006, through the purchase of shares on the New Zealand Exchange, at prevailing market prices. The shares acquired will be held as Treasury stock.
Chairman of Dorchester, Mr Barry Graham, said: “The directors consider that the market currently offers a strong buying opportunity as the company’s current share price is at a significant discount to the underlying value.
We have an opportunity to acquire shares at a significant discount to their underlying value. This is a highly attractive use of the company’s capital.
The directors are strongly supportive of the strategic direction and leadership of the Group under new CEO, Andrew Walker. We believe that the share buyback is in the best interests of shareholders, will be accretive to share holder value, and is an effective use of shareholder funds. We see this as a strong investment opportunity for Dorchester in the current market.”
Dorchester’s CEO, Mr Andrew Walker, said: “Dorchester continues to deliver strong performance and results, and is well positioned in today’s more challenging finance market. Our conservative lending philosophy has served us well, and has ensured we have an appropriate risk profile for prevailing market conditions.
"Due to the current adverse market perception associated with the demise of a few, less robust financial businesses, the true value of Dorchester does not seem to be reflected in its current share price, which is trading at a significant discount to our view of the value of the company. This programme is EPS accretive, low risk and represents a good return on funds invested.”
Shares are trading close to or below the Group’s net asset backing of $1.89 per share, as at 31 March 2006.
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