Norma starts up EUR 52.9M share buyback program

Norma starts up EUR 52.9M share buyback program

Norma Announces Share Buyback Program Amid Strategic Restructuring

Norma Group, a global supplier of connection technology and automotive components, has announced a share buyback program totaling up to €260 million, funded by proceeds from the sale of its Water Management business to Advanced Drainage Systems (ADS) in September 2023. The company stated it will "promptly" utilize its existing authorization for the buyback, with shares to be canceled and capital reduced accordingly. The measure requires shareholder approval, and the annual general meeting, initially scheduled for May 21, 2024, may be postponed if preparations are delayed.

The buyback is part of Norma's broader capital allocation strategy following the €620–640 million net cash inflow from the Water Management divestiture. The company previously outlined plans to allocate €300 million toward debt reduction and up to €70 million for acquisitions. The share repurchase underscores Norma's commitment to returning value to shareholders while optimizing its balance sheet.

Separately, Norma disclosed €102 million in write-downs for certain EMEA-region investments, primarily in Germany, due to revised sales forecasts for 2028–2030. However, the company emphasized that these non-operating charges will not impact adjusted EBIT or its revenue and margin outlook.

The announcement follows Norma's 2023 financial results, which showed stable profitability with an adjusted EBIT margin of 8.0% and a significant improvement in cash flow, driven by operational efficiency measures. CEO Guido Grandi previously highlighted progress under the "Step Up" program, targeting growth in strategic units such as Industry Applications and Mobility & New Energy.

The stock rose 4% following the news, reflecting investor optimism about the capital return plan and restructuring efforts. Norma's final 2023 figures and 2024 outlook will be presented on March 26, 2024.

This move aligns with Norma's strategy to streamline operations and focus on core markets, balancing short-term liquidity with long-term growth objectives.