Huons(243070) group aesthetics specialist company Humedix(200670) said on the 10th that its board of directors resolved to cancel $5 billion won worth of treasury shares.
The shares to be canceled are 184,000 common shares, equivalent to 1.64% of the current total number of issued shares. The cancellation is scheduled for the 21st, and the planned cancellation amount is about 5 billion won based on book value.
This treasury share cancellation uses shares secured through a treasury share trust purchase. The company said, "Although the total number of issued shares will decrease as the shares acquired within the scope of distributable income are canceled, there will be no change in capital."
Canceling treasury shares is a representative shareholder-friendly policy that reduces the total number of shares outstanding in the market and raises earnings per share (EPS) and book value per share (BPS). The company previously purchased treasury shares on the open market for three months from June 10 to Sept. 9.
The company said, "This reflects the management's strong commitment to increasing corporate value," adding, "By proceeding to cancel all shares acquired rather than stopping at a buyback, we have eased concerns about potential overhang in the market."
The company is paying quarterly dividends of 200 won per share this year and plans to raise the per-share dividend by 5%–30% each year going forward. The company said that by paying dividends using the capital reserve as the source, shareholders who meet certain conditions can reduce their dividend income tax burden.
Kang Min-jong, Humedix CEO, said, "We will actively use the funds secured through business growth to secure future growth engines and enhance shareholder value."