South32 Limited today, 27 March 2017, announced that it intends to return an additional $500 million to shareholders, equating to 4.5% of the Group’s current market capitalization.
This capital management program, which complements the Group’s dividend policy, will initially take the form of an on-market share buy-back in Australia.
“The combination of our operating leverage, strong balance sheet and simple capital management framework is designed to maximise returns and reward shareholders as financial performance improves. Today’s announcement further demonstrates our disciplined approach to capital management and our confidence in the Group’s cash generating capacity,” says David Crawford, South32 Chairman.
“Our net cash balance continues to build giving us the financial strength and flexibility to invest in our existing operations, pursue opportunities where we can create value and return excess capital to shareholders. This $500 million capital management program meaningfully increases shareholder returns and follows the recent announcement of our US$192M interim dividend,” says Graham Kerr, South32 Chief Executive Officer.
The $500 million capital management program is expected to be completed over a 12 month period and all alternatives will continue to be assessed to ensure this capital is returned in an efficient manner.