Celltrion to Return One-Third of Annual Net Income to Shareholders, Buys Back Won 100 Billion in Treasury Shares

[Financial News] Celltrion has unveiled a mid- to long-term policy to use one-third of its annual consolidated net income for shareholder returns each year. As the first step under the policy, it also decided to buy back Won 100 billion worth of treasury shares.
Celltrion said it decided at a board of directors meeting on the 31st to repurchase 524,384 treasury shares for about Won 100 billion. The buyback will begin on September 1 through open-market purchases.
The latest buyback amount will be included in this year's shareholder-return total. The company plans to continue returning capital through cash dividends as well as treasury share purchases and cancellations.
Starting this year, Celltrion will use about 33% of its annual net income on a consolidated financial statement basis as a source for shareholder returns. The company said it will decide between cash dividends and treasury share purchases and cancellations, taking into account stock price levels, market conditions, its financial structure, cash flow and investment plans.
If it judges that the stock price is low relative to the company's value, it will use treasury share purchases and cancellations. If stable cash returns are needed, it will increase the dividend portion. The annual scale and method of shareholder returns will be finalized and disclosed after going through procedures such as board and General Meeting of Shareholders approvals, based on year-end results and management conditions.
The treasury shares purchased this time will also be canceled in the future after a board resolution. Canceling treasury shares reduces the number of shares outstanding, which can affect earnings per share (EPS) and book value per share (BPS).
Including this decision, Celltrion has decided to buy back a total of 1,600,288 treasury shares this year, worth Won 300 billion. Over the past three years, cumulative treasury share purchases have reached about 8.93 million shares.
Celltrion also plans to consider additional treasury share purchases and cancellations in the future if it determines that the gap between its stock price and corporate value remains large, taking available resources and market conditions into account.
A Celltrion official said, "We have established a mid- to long-term policy to use one-third of annual consolidated net income for shareholder returns each year," adding, "We will continue shareholder returns by combining cash dividends with treasury share purchases and cancellations in line with market conditions."

[email protected] Jung Sang-hee Reporter