Cosco approves P1-B share buyback program
MANILA, Philippines—Retailer Lucio Co-led holding firm Cosco Capital Inc. is embarking on a P1-billion share buyback program, a move seen to boost share prices in the stock market.
In a disclosure to the Philippine Stock Exchange (PSE) on Friday, Cosco said its board had authorized company chair Co and president Leonardo Dayao to execute the buyback on behalf of the company.
Companies typically buy back shares from the open market when they deem that their shares are undervalued by the market. By reducing the number of outstanding shares, the earnings per share increase. However, only companies with retained earnings are allowed to buy back shares.
Shares of Cosco rose by 1.13 percent to close at P8.09 a share on Friday, giving the company a market capitalization of P59.24 billion.
In its disclosure, Cosco said that it had approved an external audit plan for 2015 alongside a P592-million cash dividend, broken down into a regular dividend of 6 centavos a share and a special dividend of 2 centavos a share.
Cosco’s flagship unit Puregold Price Club Inc. also disclosed yesterday that its board had approved an external audit plan for 2015 alongside a cash dividend declaration worth a total of 30 centavos a share or P830 million. The cash dividend will consist of 20 centavos in regular dividend and a special dividend of 10 centavos a share.
Cosco, formerly Alcorn Gold Resources Corp., was originally incorporated on Jan. 19, 1988, with the primary purpose of engaging in the exploration, development and production of oil and gas, and metallic and nonmetallic reserves. In 2000, the Securities and Exchange Commission approved the amendment of its primary purpose from an oil and mineral exploration and development corporation into a holding company. Today, Cosco’s portfolio included interests in retail, real estate, liquor distribution and mining.
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