KUALA LUMPUR (Nov 13): Top Glove Corp Bhd today bought back an additional 9.01 million shares worth RM69.9 million in the open market.
This is the fourth consecutive day that the world’s largest rubber glove maker has bought back shares.
In total, Top Glove has spent RM279.44 million this week alone to buy 35.82 million of its own shares, representing about 0.4% stake in the company.
The amount spent is more than the net profit of RM227.1 million that it earned in the first half of the financial year ended Aug 31, 2020 (FY20).
The company’s latest filing shows that the block of 9.01 millions shares were bought at between RM7.70 and RM7.78.
Top Glove, whose share price has been on the decline since mid-October, started buying back its shares on Tuesday, after the previous round in September, when it paid about RM355 million to buy back shares in six transactions. The company currently holds 85.68 million treasury shares, which is equivalent to 1.045% stake.
This means that Top Glove has in total spent about RM634.5 million on buying back shares since September. Based on issued its share capital of 8.12 billion shares, the sum of RM634.5 million would be translated into cash per share of 7.8 sen should it use the amount for dividend.
It is debatable whether the glove maker should utilise its ballooning cash pile to mop up shares on the open market considering the company’s share price has shot up 397% year to date.
Nonetheless, Top Glove’s board is expected to have deliberated before giving the greenlight to conduct share buyback at the current price level.
Top Glove’s share price gained eight sen, or 1.04%, to close at RM7.78 with a market capitalisation of RM63.77 billion. The counter saw a slight rebound today after trending downwards for much of this week, following Pfizer Inc's announcement of a viable COVID-19 vaccine candidate on Monday.