KUALA LUMPUR (June 2): The Employees Provident Fund (EPF) has decided to vote against MR DIY Group (M) Bhd’s proposed renewal of authority for the company to purchase its own shares in its annual general meeting (AGM) on June 8. 

“The company should utilise their cash balance to pay higher dividend to shareholders rather than share buy-back,” EPF said in its voting decision notice posted on the fund’s website. 

According to Bloomberg’s data, EPF is a substantial shareholder and the third largest shareholder of MR DIY with a 5.38% stake or 507.17 million shares. MR DIY has a total share capital of 9.43 billion shares, of which 1.04 billion shares are floating in the open market. 

Should MR DIY pass the resolution on share buy-back, the aggregate number of shares which may be purchased and held by the company shall not exceed 10% of the total number of issued shares of the company at the time of purchase. 

Based on the home improvement retailer’s latest financial statement, the company has cash and bank balances amounting to RM1.36 billion as at March 31. 

MR DIY declared an interim single tier dividend of 0.6 sen per ordinary share, an approximately RM56.6 million payout, in respect of its first quarter ended March 31, 2023 (1QFY2023), payable on June 23. 

The company’s net profit rose 27.13% to RM127.77 million for the 1QFY2023 from RM100.5 million a year earlier (1QFY2022), thanks to higher revenue and lower freight costs, which boosted its gross profit.

Quarterly revenue climbed 15.6% to RM1.05 billion from RM905.16 million, driven by growth in same-store sales as well as contribution from new stores, its bourse filing showed.

Aside from the share buy-back resolution, EPF is voting on the other six resolutions by MR DIY, including the re-election of Datuk Azlam Shah Alias and Ng Ing Peng as company directors, payment of directors’ fees and benefits payable to the non-executive directors for up to RM700,000 from July 1 until the next AGM in 2024.

On Friday (June 2), share price of MR DIY closed four sen or 2.58% higher to RM1.59, valuing the group at RM15 billion. The stock has tanked 22.82% in the past six months.