SET-listed cosmetics company Beauty Community Plc (BEAUTY) yesterday informed the bourse that its board of directors has approved a share repurchase programme for financial management purposes, with a maximum buyback amount of 950 million baht.
Total repurchased shares will not exceed 64 million shares at a par value of 10 satang per share or 2.13% of total paid-up capital. The repurchase period will start from July 24, 2018 and run until Jan 23, 2019.
Suwin Kraibhubes, chief executive of Beauty Community, said the company has cash-on-hand of 1.2 billion baht, which is sufficient for the share repurchase programme and other investment plans.
The reasons for the share buyback are maximising the benefits from the company's excess liquidity and increasing the return on equity and earnings per share, said Mr Suwin.
As of March 31, the company's retained earnings were valued at 1.1 billion baht, while debts, which will be due in six months from the date of the share repurchase programme, stood at 1.34 billion baht. Incurred debts are mainly comprised of trade account payables from the firm's business operations.
Beauty Community's shares took a 30% nosedive last Tuesday as investors have lost confidence in its sales and revenue growth potential.
Beauty Community, which also sells dietary supplements as a secondary revenue source, has been reeling from controversies surrounding that industry following deaths connected with substandard and unlicensed cosmetics and food supplements.
Dietary supplement players have since been inspected by the Food and Drug Administration, causing delays in exporting Beauty Community's products, which took a toll on the firm's second-quarter performance.
SET president Pakorn Peetathawatchai said that the bourse has asked the firm to give information on its business plan and share repurchase programme as the issue is affecting Beauty Community's share price movement.
The SET normally monitors stocks which have irregular trading volume as part of its regular inspection process, he said.
BEAUTY shares closed yesterday on the SET at 7.25 baht, down 75 satang, in trade worth 4.23 billion baht.
