[Click eStock] "Hanssem Reveals Shareholder Return Policy... Expectation to Resolve Uncertainty"

Yuanta Securities Report

[Asia Economy Reporter Minji Lee] Yuanta Securities stated on the 23rd that regarding Hanssem's shareholder return policy, although the policy strength was not as high as the market had expected, it is too early to be disappointed as the company's commitment was confirmed.

Looking at Hanssem's stock price so far, it continued to show a sluggish trend after the decision of the largest shareholder and seven related parties to sell their shares. This was due to a combination of concerns about the deterioration of Hanssem's B2C competitiveness following the change of the largest shareholder, discord with the second-largest shareholder Teton during the sale process, absence of a shareholder return policy, and worries about poor third-quarter earnings.

As a mid- to long-term shareholder return policy, Hanssem decided to implement quarterly dividends starting from the first quarter of next year. The company raised the minimum annual dividend payout ratio to 50% and stated that if the annual FCF (Free Cash Flow) exceeds net income, it will pay dividends exceeding the 50% payout ratio. The management plans to continuously repurchase treasury shares to enhance shareholder value when the company value is judged to be below an appropriate level.

Additionally, the company plans to acquire treasury shares worth approximately 30 billion KRW by February 22 of next year. After this treasury share repurchase, the stake will increase from 26.7% to 28.2%, and according to the mid- to long-term shareholder return policy, there is a possibility of an additional treasury share repurchase worth about 30 billion KRW. Lastly, Hanssem mentioned that it will dispose of its shares in Hanssem Corporation USA, planning to sell all 1,025 shares to Cho Chang-geol, former honorary chairman of Hanssem, for 45 billion KRW for asset efficiency purposes.

Researcher Kim Ki-ryong of Yuanta Securities said, “This disclosure confirmed the first concrete action and commitment to IMM PE's shareholder return policy,” adding, “It is positive in terms of reducing uncertainty about discord with the second-largest shareholder.” Assuming a dividend payout ratio of 50% based on next year's net income estimates, the annual dividend amount is expected to increase from 1,300 KRW per share last year to about 3,000 KRW (750 KRW quarterly) next year.

Researcher Kim further explained, “It is difficult to say that the shareholder return policy announced this time is stronger than the treasury share cancellation (26.8%) that some expected,” but added, “It is too early to reflect excessive disappointment as this marks the actual start of the shareholder return policy after the change of the major shareholder.”

This content was produced with the assistance of AI translation services.