adminThe group was forced to revise its share buyback scheme after SECZ raised concerns that the planned scheme was in violation of the Zimbabwe Stock Exchange listing requirements and rules.
The terms of the scheme had stated that the minimum price paid would be 20 percent above or below the weighted average of the market price of the shares for the five days immediately preceding the date of the repurchase.
According to ZSE listing requirements, “repurchases may not be made at a price greater than 10 percent above the weighted average of the market value for securities for the five business days immediately preceding the date on which the transaction is effected”.
A share buyback entails the repurchase of outstanding shares by a company in order to reduce the number of shares on the market.
Speaking at the company’s annual general meeting yesterday, NicozDiamond board chairman Mr Albert Nduna said the directors were seeking authority to purchase the shares on the market at a minimum price that is 10 percent above or below the market price of each share, in line with ZSE requirements.
“The maximum number of shares authorised to be acquired will be no more than 10 percent of the company’s ordinary issued share capital,” Mr Nduna said.
NicozDiamond said the share buyback was necessitated by speculation on the market and undermining of the value of the insurance firm’s share price due to the large numbers of shareholders, which at over 5 000, was making it expensive to maintain the share register and disseminating information to shareholders.
Meanwhile, the group posted a profit after tax of US$2,43 million for the year ended December 31, 2012 up from US$1,6 million in 2011.
The insurance group’s gross premium grew by 5 percent to US$24,8 million from US$23,5 million in the prior year on the back of good performance of the group’s associate companies that contributed US$399 270 to group profits, an increase of 37 percent from prior period.
Earnings per share for the period came in at US0,43cents and the positive performance saw the group declaring a dividend of U$0,064c. Mr Nduna said the dividend was a show of appreciation to the shareholders for their support.
He said while the Uganda operation had made an underwriting loss of US$259 242, Zimbabwe had, on the other hand, made an underwriting profit of US$367 039 resulting in an underwriting profit of US$107 797 for the period under review.
Online Reporter