Hanwha Aerospace to buy back 150 billion won of shares for staff compensation

Hanwha Aerospace said Friday it will buy back 150 billion won ($111 million) of its own common shares to fund employee compensation, according to a regulatory filing.

The repurchase covers 220,000 common shares and will run on the open market from Nov. 9 to Feb. 8 next year, with Hanwha Investment & Securities acting as the brokerage handling the orders. The company priced the plan off a closing price of 680,000 won ($507) a share, and its daily purchase limit is set at 48,549 shares.

The buyback sits inside a ceiling of 2.48 trillion won ($1.85 billion). Hanwha Aerospace already holds 114,613 common shares of treasury stock, split between 54,546 shares held within the distributable-profit limit and 60,067 acquired by other means.

The company has told investors that its third-quarter results were weighed down by scheduling and one-off costs, and that it expects earnings to improve from the fourth quarter. Deliveries on major programs, including the second batch of K9 self-propelled howitzers for Poland, were pushed into the fourth quarter, while some volumes were shipped early in the second quarter, and the aerospace division booked losses tied to geared turbofan engines.

"The third quarter was affected by delivery schedule adjustments and one-off costs, but performance should improve in earnest from the fourth quarter," a Hanwha Aerospace official said.

Its ground defense order backlog stands at about 35 trillion won ($26.1 billion), supported by a Spanish K9 export contract signed in the third quarter and a deal to supply Croatia with 18 Chunmoo multiple rocket launchers for about 640 billion won ($477 million). The company expects deliveries of the second batches of K9 howitzers and Chunmoo systems for Poland, along with K9 projects in Egypt and Australia, to lift results from the fourth quarter.