Corporate Communications
08.01.2015
IMMOFINANZ - year begun with share buyback
Shortly before Christmas, on 23 December, we launched our 2014/2015 share buyback programme, as planned. In the final days of the old and first days of the new year (by 2 January 2015) we repurchased 655,000 shares – at a weighted average share price of EUR 2.10.Information on the current status of the programme can be regularly found in the investor relations section of our website: http://www.immofinanz.com/en/investor-relations/our-share/share-buyback-programme/
In this regard, we would like to address two questions that have been posed several times since the announcement of the buyback programme.
Why are "only" up to about 10.17 million shares being repurchased in the scope of the current programme?
Because we don't have any more latitude at present. The 10% limit (in accordance with the Austrian Stock Corporation Act treasury shares purchased and held by a company are not permitted to exceed 10% of the share capital) was reached, thus we called or "cancelled" 1% of the shares parallel to announcement of the 2014/15 share buyback programme. About 9% of the treasury shares held by IMMOFINANZ have been linked to a treasury financing scheme since the end of 2012/beginning of 2013. Repayment of this EUR 150 million in financing is planned in the course of the 2014/15 financial year.
Why in general a share buyback?
With a share buyback a company purchases its own shares, thus reducing the number of shares in circulation. This is basically viewed by the market as a positive sign, on the one hand, because the company generally signals that it considers the issued shares undervalued (see the IMMOFINANZ share's high discount to net asset value), and, on the other hand, because the profitability indicators such as profit per share also improve.
The impact of a share buyback programme on the respective share price performance can't be predicted, of course. But generally there are numerous investors who welcome and also want share buybacks – particularly when the buyback price is below the "fair" value.
In this regard, we would like to address two questions that have been posed several times since the announcement of the buyback programme.
Why are "only" up to about 10.17 million shares being repurchased in the scope of the current programme?
Because we don't have any more latitude at present. The 10% limit (in accordance with the Austrian Stock Corporation Act treasury shares purchased and held by a company are not permitted to exceed 10% of the share capital) was reached, thus we called or "cancelled" 1% of the shares parallel to announcement of the 2014/15 share buyback programme. About 9% of the treasury shares held by IMMOFINANZ have been linked to a treasury financing scheme since the end of 2012/beginning of 2013. Repayment of this EUR 150 million in financing is planned in the course of the 2014/15 financial year.
Why in general a share buyback?
With a share buyback a company purchases its own shares, thus reducing the number of shares in circulation. This is basically viewed by the market as a positive sign, on the one hand, because the company generally signals that it considers the issued shares undervalued (see the IMMOFINANZ share's high discount to net asset value), and, on the other hand, because the profitability indicators such as profit per share also improve.
The impact of a share buyback programme on the respective share price performance can't be predicted, of course. But generally there are numerous investors who welcome and also want share buybacks – particularly when the buyback price is below the "fair" value.
IMMOFINANZ – a publicly listed European commercial real estate group with focus on two asset classes: Office and retail in eight core markets.