Borouge will seek approval in its upcoming Annual General Meeting on 7th April to initiate a share buyback programme with a target of buying 2.5 per cent of its issued share capital.
The proposed share buyback underlines the company’s confidence in its long-term growth prospects and commitment to delivering superior returns through multiple avenues and underpinned by its exceptional operational and financial performance.
Borouge’s strategic growth moves
The company recently delivered a strong result for the full year 2024, achieving a 24 per cent year-on-year increase in net profit to $1.24 billion and free cash flow generation of approximately $1.6 billion. Production levels soared to an all-time high of 5.2 million tonnes and annual sales volumes reached a record 5.3 million tonnes.
Earlier in March this year, ADNOC and Austria’s OMV said they will merge their shareholdings in Borouge and Borealis to create Borouge Group International, a $60 billion global integrated chemicals company that would become the world’s fourth-largest producer of polyolefins.
The markets did not react favourably to the news, and Borouge share prices have dropped 11.3 per cent from AED2.65 on 4th March to its closing price of AED2.35 on Monday.
Hazeem Sultan Al Suwaidi, CEO of Borouge, commented: “Borouge’s share buyback to repurchase shares at an attractive valuation, underscores our commitment to enhancing shareholder value.
“With one of the highest dividend yields on the ADX, this buyback highlights our strong financial position and ability to seize value-accretive opportunities. Backed by a robust balance sheet and strong cash flow, we remain well-positioned to maximise returns while advancing the Borouge 4 expansion and other strategic initiatives.”
Upon receiving the necessary approvals, the share buyback would be conducted through open market transactions in accordance with Abu Dhabi Securities Exchange (ADX) regulations. The quantity of shares repurchased will be dependent on market conditions and other factors.
In addition to the share buyback proposal, shareholders will also vote to approve the final 2024 dividends of AED0.794 fils per share, which will be distributed on 28 April. This would bring the company’s total 2024 dividend payout to $1.3 billion, equivalent to AED0.1588 fils per share.
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