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- Release Date: 10/10/13 10:50
- Summary: BUYBACK: MRP: Mighty River Power Announces Share Buyback Programme
- Price Sensitive: No
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MRP
10/10/2013 08:50
BUYBACK
REL: 0850 HRS Mighty River Power Limited (NS)
BUYBACK: MRP: 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 2014.
"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 13 cents per
share (representing 71% of Free Cash Flow 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 5.2 cents per share to be paid in March 2014.
A copy of Appendix 3C, which Mighty River Power is required to lodge with the
Australian Stock Exchange pursuant to the ASX Listing Rules, is attached.
End CA:00242192 For:MRP Type:BUYBACK Time:2013-10-10 08:50:12
