- Leon’s Furniture (LNF) has received Toronto Stock Exchange approval for its proposed share repurchase plan
- According to the plan, the company intends to repurchase and cancel four million common shares, representing 4.99 per cent of its issued and outstanding securities
- To facilitate the plan, daily purchases of the shares will be limited to 3,124 common shares
- The repurchase program comes after a difficult second quarter of 2020, which saw a 23.6 per cent drop in total sales
- Leon’s Furniture (LNF) is currently up 3.44 per cent and is trading at C$18.94 per share
Leon’s Furniture (LNF) has received Toronto Stock Exchange approval for its proposed share repurchase plan.
Under the terms of the plan, the Toronto-based company intends to repurchase and cancel a maximum of four million common shares. This represents 4.99 per cent of its total 80,380,746 issued and outstanding shares as of September 4, 2020.
According to previous transaction data, Leon’s daily average trading volume for the six months ending August 31 is 12,497 shares. In order to facilitate the repurchase plan, daily purchases will be capped at 3,124 common shares on the Toronto Stock Exchange.
The bid is expected to begin on September 15 and will conclude once the required number of shares repurchased is reached or on September 14, 2021, whichever comes first. The plan may also be terminated by Leon’s Furniture upon the provision of sufficient notice.
Leon’s decision to repurchase a portion of its shares comes off the back of a challenging second quarter, in which the company saw a 23.6 per cent drop in total sales. This lead to a 25.7 per cent decline in revenue, from C$560.9 million in the same period of 2019 to $416.7 million this year.
The company said this was driven by substantial reductions in physical store traffic due to COVID-related closures across the country. However, this was significantly offset by a 500 per cent increase in online sales.
The overall performance, in conjunction with a variety of cost-saving measures that were implemented resulted in an 88 per cent increase in net income for the quarter, from $25 million last year to $47.2 million this year.
Leon’s Furniture (LNF) is currently up 3.44 per cent to C$18.94 per share at 1:05pm EDT.