|06 September 2017|
|Almost 30 Stocks Buyback Shares in August, Buyback Value at 11M High|
In the month of August 2017, there were a total of 32,195,591 shares repurchased by 29 stocks, with a total consideration of S$59.7 million. Buyback consideration was up 123.5% from the S$26.7 million reported for July 2017.
Buybacks in August 2017 have taken the total share buyback consideration for the 2017 year to date to S$287 million. This compares with S$679 million for the first eight months of 2016. August’s share buyback consideration was down 6.7% YOY from S$63.9 million in August 2016. Over the past 12 months, the Straits Times Index (STI) rallied 16.2%, with re-invested dividends boosting the total return of 20.1%.
As illustrated below, monthly total buyback consideration in August 2017 more than doubled the buyback value in July. This coincided with the majority of stocks completing their blackout periods for buying stocks ahead of quarterly earnings reports in August. There was also a decline in the STI during the month of 1.6%, which was the first monthly decline for 2017.
Monthly Share Buyback Consideration (S$ Million) & STI Month-End Levels
Source: SGX (data as of 31 August 2017)
The five stocks with the largest buyback consideration value last month were Oversea-Chinese Banking Corp (OCBC), M1, ST Engineering, S i2i and Singapore Post. For a sixth consecutive month, OCBC had the highest buyback consideration in the month, taking the total number of shares purchased on the 12-month mandate effective 28 April to 11.36 million.
S I2I’s current buyback mandate began on 1 August. For the month of August it had purchased 5.2% of its outstanding shares, with transactions on 4 September and 5 September, taking this share to up 6.2%. The total number of shares that may be purchased or acquired by the S I2I is limited to no more than 10% of the total number of issued Shares of the Company ascertained as of 1 August - the date of the EGM at which the adoption of the Share Buyback Mandate was approved. SI2I’s 2Q17 results can be found here and its latest quarterly update pursuant to being placed on the SGX Securities Trading Watchlist can be found here. The share price of the telecommunication service company rallied 79.9% over the first eight months of 2017.
Share buyback transactions involve share issuers repurchasing some of their outstanding shares from shareholders through the open market. Once the shares are bought back, they will be converted into treasury shares, which means they are no longer categorised as shares outstanding. Other motivations for share buybacks include companies moving to align stock valuations with balance sheet objectives.
The table below summarises the buyback considerations in August 2017. The table is sorted by the value of the total consideration amount, which is the product of the number of shares purchased and the purchase price of the shares.
Source: SGX (data as of 31 August 2017) *percentage of company’s issued shares excluding treasury shares as at the date of the share buyback resolution
The date of the relevant share buyback mandate is also provided in the table above, in addition to the amount of shares authorised to be bought back under the mandate. The total number of shares purchased under the mandate and the percentage of the companies that issued shares that have been repurchased under the mandate are also provided.
Share buyback information can be found on the company disclosure page on the SGX website, using the Announcement category and sub-category of Share Buy Back-On Market (click here).
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