The company’s board approved the buyback program from Sept. 25 through March 24 next year. The company reserves an option to extend this to Sept. 24, 2025.
At the current share price, the buyback is equivalent to about 5.8 percent of Axelum’s market value.
Additionally, the board may increase the buyback amount depending on market conditions and the availability of unrestricted retained earnings.
Axelum is the supplier of United States-based coconut water giant Vita Coco.
Big picture
Companies often resort to share buybacks to indicate their confidence that the stock is undervalued.
Buybacks also reduce the number of shares in the market, with the lower supply potentially increasing the price per share.
Repurchased shares are held as treasury stock, which can be reissued or retired later on.
Axelum reversed losses this year
Axelum, partly owned by tycoon Manuel V. Pangilinan’s Metro Pacific Investments Corp., saw profits surge to P208 million in the first six months of the year, reversing a loss of P124.5 million in 2023.
Sales grew 14 percent to P3.2 billion, driven by strong volume growth of desiccated coconut, coconut milk powder, and sweetened coconut.
Share prices still below IPO
Axelum’s share price has recently risen amid the broader rally at the PSE Index.
It soared nearly 16 percent, closing at P2.26 per share on Tuesday.
However, the stock is still trading about 55 percent lower than its 2019 initial public offering price.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
