Frasers Group has unveiled an £80m share buyback program, aiming to decrease its share capital effectively.
- The program involves a formal agreement with Barclays Bank to manage the buyback process.
- This initiative occurs during the company’s closed period, ending with its final results announcement in July.
- A maximum of 10 million shares is set for purchase, with a financial ceiling of £80m.
- Frasers Group has reported a 4.4% rise in operating profits and revenues.
Frasers Group, under the stewardship of Mike Ashley, has embarked on a significant financial maneuver, announcing a new share buyback programme valued at up to £80 million. This strategic move is designed to reduce the company’s share capital effectively.
In coordination with Barclays Bank, Frasers Group has set up a non-discretionary arrangement to carry out the share buyback process. This agreement allows the company to proceed with the buyback during its closed period, which extends until the release of its final financial results for the year ending 28 April 2024, scheduled for July.
The company has specified that no more than 10 million shares will be purchased through this program, ensuring that the total expenditure does not exceed the £80 million limit.
This decision follows the company’s recent financial performance highlights. Frasers Group has reported an increase in operating profits, rising by 4.4% year-on-year to £298.1 million for the six months leading to 29 October 2023. Correspondingly, the group’s revenues have escalated to £2.76 billion, marking another 4.4% increase over the previous year.
A major contributor to this financial growth is the UK sports retail division, which includes Sports Direct. This segment alone accounted for over half of the group’s annual revenues, achieving £1.5 billion, a slight year-on-year rise of 0.8%.
Additionally, the premium lifestyle sector, encompassing brands like Flannels, saw a sales increase of 3.1% year-on-year, totaling £550.1 million. Moreover, Frasers’ international retail operations experienced a significant upswing, generating sales of £645.8 million, reflecting a 13.2% increase.
Frasers Group’s initiative highlights its proactive financial strategy to manage and potentially optimize its capital structure, demonstrating stable growth across various retail segments.
Frasers Group’s share buyback scheme underscores its strategic approach to capital management amid ongoing financial growth.
