Flora Growth Corp.’s (NASDAQ:FLGC) board of directors has authorized the repurchase of up to $5 million of its outstanding common shares as market conditions and the company’s liquidity warrant.
“We believe that the potential to repurchase our shares at these levels represents a compelling opportunity to deploy available cash to drive shareholder value,” stated Luis Merchan, Flora’s chairman and CEO.
The board believes that the decline in the market price of the company’s shares is largely attributable to the weakness of the broader financial market in general, and the cannabis sector in particular, coupled with the recent selling of several millions of shares by certain shareholders who acquired such shares prior to the company’s IPO at a very low-cost basis and who had previously been subject to a one-year lockup period which expired in mid-May.
Merchan continued, “Flora continues to move assertively to execute its growth plans while simultaneously improving gross profit margins and reducing corporate overhead expenses. We are confident in the company’s short, medium and long-term growth prospects based on our strong in-market brand portfolio together with our cultivation and export capabilities and life sciences research. The repurchase program affords us the opportunity to increase our ownership in our portfolio of high-quality brands through our shares, which in our view are trading well below NAV.”
Repurchases may be made from time to time through open market purchases, privately negotiated transactions or by other means. Depending on market conditions and other factors, these repurchases may be commenced or suspended from time to time without prior notice. There can be no assurances how many shares, if any, the company may repurchase and, in no event shall the company repurchase more than five percent of the total number of issued and outstanding shares as of June 16.
Photo by CRYSTALWEED cannabis on Unsplash
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