Pendragon PLC Share Buyback Programme

 
TIDMPDG 
 
PENDRAGON PLC SHARE BUYBACK PROGRAMME 
 
The Company today announces it will commence an initial GBP20 million share 
buyback programme of its ordinary shares.  The Company has today entered into 
an agreement with Jefferies International Limited ("Jefferies") pursuant to 
which Jefferies will implement that programme on behalf of the Company. 
 
The Company's board of directors (the "Board") considered the Group's capital 
structure and capital allocation priorities with a view to a return of surplus 
cash to shareholders. The Company has a target range of 1.0 to 1.5 times net 
debt to underlying EBITDA and is currently trading with financial leverage 
below this level. The Board believes the Group will continue to generate strong 
cash flows and, after assessing the capital needs of the business and the 
current leverage position, has concluded that there is scope to return surplus 
cash to shareholders. The Board believes a GBP20 million share buyback programme 
will increase capital efficiency whilst ensuring the balance sheet remains 
strong, enabling the Company to pursue its investment strategy and progressive 
dividend policy. 
 
Over the last two years, the Company has demonstrated a disciplined approach to 
capital allocation.   The Company's five year, GBP100 million investment 
programme, aimed at expanding the Group's UK national footprint over the next 
four years, continues on plan.  The Group has also spent a total of GBP20.3 
million in the last 18 months purchasing certain previously leased properties 
occupied by the Group' s businesses and the Board continues to look for further 
acquisition opportunities. The Board has evaluated many potential acquisitions. 
However, valuations would not have delivered an acceptable level of return to 
justify investment by the Company. 
 
The Board will continue to pursue organic and acquisitive growth and investment 
opportunities and evaluate them against the returns generated via the share 
buyback programme. The buyback programme is capable of being stopped and 
restarted and this flexibility will enable the Company to pursue other, higher 
returning, capital allocation opportunities if they arise.  At the end of this 
share buyback programme, the Board will evaluate whether a further programme 
would be appropriate. 
 
Any purchases pursuant to the share buyback programme will be carried out 
within certain pre-determined parameters and in accordance with the Listing 
Rules, other applicable law and the limitations of buyback authority approved 
at the last Annual General Meeting of shareholders. All shares purchased under 
the programme will be cancelled. 
 
 Enquiries 
 
 Trevor Finn        Chief Executive   Pendragon PLC              01623 725114 
 
 Tim Holden         Finance Director  Pendragon PLC              01623 725114 
 
 Gordon Simpson     Partner           Finsbury                   0207 2513801 
 
 Philip Walters     Principal         Finsbury                   0207 2513801 
 
 
 
END 
 

(END) Dow Jones Newswires

May 20, 2016 02:00 ET (06:00 GMT)