Aussie Broadband Limited (ASX: ABB) has unveiled plans for an on-market share buy-back of up to 10% of its issued capital over the next 12 months. The program is set to commence following the release of the company’s HY25 results in February 2025. This decision aligns with Aussie Broadband’s capital management framework and aims to optimize its capital position while delivering value to shareholders.
Key Highlights:
- Buy-Back Details:
- Aussie Broadband plans to repurchase up to 10% of its issued shares on-market.
- Timing and volume of shares repurchased will depend on factors such as the prevailing share price, market conditions, and future capital requirements.
- The buy-back complies with the “10/12” rule under the Corporations Act and ASX listing rules, meaning it does not require shareholder approval.
- Capital Management Context:
- Aussie Broadband’s net leverage ratio target remains between 1.75x-2.50x. As of 30 June 2024, the company reported a net leverage of 1.1x FY24 EBITDA.
- Recent sale of its Superloop stake generated $99.8 million pre-tax, boosting financial flexibility.
- FY25 capital expenditure guidance of $55–$60 million remains focused on growth and operational efficiencies.
- The company declared its first fully franked dividend of 4 cents per share for FY24, signaling confidence in its financial health.
- Growth Strategy:
- Aussie Broadband will maintain financial flexibility to pursue organic and inorganic growth opportunities, building on its successful Symbio acquisition in 2024.
- The company remains committed to enhancing shareholder returns while continuing to invest in its core platforms and competitiveness.
CEO Commentary:
The Aussie Broadband board and management highlighted that the buy-back is an opportunity to maximize shareholder value while retaining sufficient capital for future growth initiatives. The decision reflects the company’s strong financial position and its commitment to a balanced approach to capital management.
Important Notes:
- The buy-back is discretionary, and there is no guarantee that the full 10% of shares will be repurchased.
- Aussie Broadband will carefully monitor market conditions and business requirements during the buy-back period.
This move signals Aussie Broadband’s confidence in its growth strategy and its ability to deliver long-term value for shareholders.
