Following strong results reported on 10 August 2015, Ansell Limited (ASX:ANN) has announced an on-market share buy-back commencing no earlier than 15 September 2015.
For FY15 the company released strong results and reported in US dollars. Excluding the $123m pre-tax one off restructuring charge in FY14 the company reported underlying net profit after tax of $188 million, up 20 per cent on the previous corresponding period (pcp). Sales increased by 3.5 per cent to $1,645 million (up 9.3 per cent on constant currency rates). The company continued the development of growth brands with Hyflex up 6 per cent, Gammex up 7 per cent, and SKYN up 16 per cent. Earnings per share came in at $1.22 dollars per share, up 11 per cent on the pcp and full year dividend was up 10 per cent to 43 cents per share.
Ansell’s Chairman, Glenn Barnes commented, “I am pleased to report that Ansell continued to deliver on its strategic objectives achieving very good results in our growth brands while realising additional value from acquisitions. Ansell has again successfully generated strong financial results reporting increased sales and significant profit growth for the financial year, despite more challenging external economic conditions than expected in the second half including unfavourable currency movements.”
Following strong results and demonstrating a strong balance sheet and on-going cash flow, the company announced the share buy-back. The company has given consideration to the prevailing share price and therefor will conduct the buy-back on an opportunistic basis. It tends to buy-back approximately $100 million over the next twelve months, representing approximately 6 million shares. The buy-back will be funded with existing cash reserves and on-going cash generation.
Ansell CEO and MD, Magnus Nicolin commented, “Providing attractive returns to shareholders through a disciplined approach to capital management remains central; to Ansell’s strategy. I am pleased therefore to be able to announce today a new on market share buy-back program. The buy-back will form part of our continued approach to capital management and will complement our ongoing investment in improved manufacturing productivity and a continued focus on identifying strategic acquisitions with attractive returns.”
Since the company’s result announcement in early August, its share price has gained approximately 5.3 per cent. For FY16, the company has indicated that whilst underlying earnings per share will grow, it expects that due to foreign exchange rates EPS will fall 22 – 26 cents, and therefor forecast an FY16 EPS of US$105 – US$1.20.
Author: Ben Visser
Aug 31, 2015
Ben is a Wise-owl equity analyst focusing on ASX blue-chips stocks. Ben has a Bachelor of Business in Finance majoring in property valuations and management. In his role at Wise-owl Ben conducts in-depth fundamental and technical analysis which helps him to find profitable investment opportunities on the ASX and abroad.