ECC in pounds 100m share buy-back plan
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.ENGLISH CHINA Clays (ECC), the chemicals and minerals group, is planning a return of cash to shareholders of around pounds 100m through a share buyback in a bid to prop up its ailing share price.
The company - the world's largest producer of kaolin, a soft clay used in paper and ceramics - said yesterday that it was considering "a significant repurchase of shares". It is understood that ECC could buy back up to 20 per cent of its shares - a move that would cost about pounds 100m at yesterday's closing price. The bulk of the buyback is set to take place after April 1999 to take advantage of tax changes, according to sources close to the company.
Lawrence Urquhart, chairman, said the board decided to return cash to shareholders after being "disappointed by the company's share price performance".
ECC made a large loss in 1996 after a radical overhaul of its key businesses. It returned to the black last year, but the turnaround failed to trigger a recovery in the share price.
Shares in ECC have fallen by almost a half since their 12-month peak of 290.5p in October, amid a general downgrade of the extraction sector and concerns over weaker mineral prices.
They rebounded 18.5p to 163.5p yesterday, buoyed by news of the share buyback and the release of interim results in line with City analysts' expectations.
ECC reported a 5 per cent increase in pre-tax profit to pounds 43.5m on turnover up slightly to pounds 417.2m. Sales in its core paper minerals division jumped 8 per cent in the first half, but prices remained subdued, ECC said.
The company also announced the acquisition of Minco, a US ceramics business, for $28m (pounds 17.5m).
Patrick Drayton, finance director, said the purchase was part of ECC's strategy of growing through bolt-on acquisitions. He said the company could spend up to pounds 35m by the end of the year on similar acquisitions.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments