SK海力士宣布40万亿韩元自有股回购并全额注销，年内还拟追加股东回报

SK hynix (000660.KS) has decided to cancel 40 trillion won ($28.8 billion) worth of treasury shares, the largest such buyback and cancellation ever by a company listed in South Korea. The chipmaker is moving to prop up its stock with an aggressive shareholder return program as investor discontent has mounted over a recent plan to pay large performance bonuses and a sharp drop in the share price. Through additional measures, SK hynix has signaled total shareholder returns of around 100 trillion won.
SK hynix said on the 19th that its board had approved a plan to acquire 40.00434 trillion won worth of treasury shares and cancel all of them. To that end, the company plans to buy a total of 24.07 million common shares on the open market over three months, from the 20th through November 19. The volume to be purchased and canceled equals 3.3% of the company's 730,492,365 total shares outstanding.
The cancellation is the largest among share buyback-and-cancellation cases by companies listed in South Korea. With record earnings growth expected on the back of a boom in artificial intelligence (AI) memory, the company says it will match that with an unprecedented level of shareholder returns. Based on the average of brokerage estimates, SK hynix is expected to post 266 trillion won in operating profit this year, and brokerages project its free cash flow (FCF) to approach 200 trillion won by year-end. Net cash rose to about 69 trillion won as of the end of June.
SK hynix also plans to sharply increase the funds available for shareholder returns. The company had previously set a policy of financing shareholder returns within 50% of FCF over the three years from last year through next year. Through this disclosure, however, it will pursue expanding that pool to more than 50% of FCF. As a result, the funds for shareholder returns are expected to grow from the previous level of several tens of trillions of won to more than 100 trillion won, based on brokerage forecasts.
Accordingly, SK hynix plans to announce more than 60 trillion won in additional shareholder return measures within this year, including further share buybacks or cancellations and a special dividend. "We plan to pursue additional shareholder returns by combining treasury share acquisitions and cancellations with dividends, taking into account cash flow during the policy period, market conditions and distributable profit," a company official said. "We plan to lay out the specific scale and methods around October, when we report third-quarter earnings, after a board resolution."
The industry expects SK hynix's shareholder return announcement to provide a springboard for a rebound in its recently depressed share price. SK hynix said it judged that the company's intrinsic value — including its business competitiveness, cash-generating capacity and medium- to long-term growth potential — was not sufficiently reflected in the current share price, and that it had brought forward its existing shareholder return policy to support the stock.
Despite expectations for earnings growth this year, SK hynix shares closed at 1.5 million won on the day, weighed down by views that the memory industry may have reached a cyclical peak and by global economic swings. That is about half the 2.919 million won recorded on June 22. The decline came amid concerns over damage to shareholder value stemming from the recent push to list Solidigm, its U.S. NAND subsidiary, and the payment of performance bonuses reaching 700 million won per employee.