Kontoor Brands Inc., the parent company behind Wrangler and Lee, recently revealed plans for a new share repurchasing initiative. Approved by the board of directors, the company aims to commence a stock buyback program totaling up to US $ 300 million of its common stock.
This fresh authorisation, lacking a set expiration date, surpasses the previous US $ 200 million program initiated on 5th August 2021. The bulk of these share repurchases is anticipated to be financed through the robust cash flow generated by the company’s operations.
Scott Baxter, president, CEO, and chair of Kontoor Brands, said, “The announcement of a 300 million US dollar share repurchase program illustrates our enhanced capital allocation optionality and reflects the strong cash flow generation of our business while underscoring Kontoor’s unrelenting focus on delivering superior total shareholder return over time.”
It’s a common strategy among publicly traded companies, like Kontoor Brands, to buy back shares from the market as a means to reduce the total number of outstanding stock shares.
This move follows Kontoor Brands’ third-quarter revenue report of US $ 655 million, showcasing an 8 per cent increase, and comes just over a month after that financial update.
