This should please investors in privately held MGM: The studio says this morning that the board has added $300 million to its stock-repurchase plan, though it offered no timetable.
CEO Gary Barber considers it a vote of confidence in the company, which yesterday reported strong financial results for 2015 helped by movies including Spectre and TV shows such as Teen Wolf, Vikings and Fargo.
“We remain focused on driving stockholder value and believe that these future repurchases will be accretive to earnings, a good use of our capital and will be executed opportunistically while maintaining a very strong and flexible balance sheet,” the CEO says.
MGM already has spent $1.1 billion since 2011 repurchasing 26 million shares, about a third of the number originally issued.
It stepped up the buyback effort last year. MGM spent $241.5 million in 2015 for about 3.1 million of its Class A shares at an average price of $77.76 per share. The previous year it shelled out $8.9 million for 125,212 shares at an average price of $71.41.
In its January deal to buy the 45% stake in United Artists Media Group owned by Mark Burnett, Roma Downey and Hearst Productions, MGM reissued more than 1.3 million shares, valued at $90 apiece. It also paid $113.5 million in cash.
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