Fortescue Metals $500m buy-back over 12 months

Company News

by Jessica Amir

One of Australia’s iron ore majors, Fortescue Metals (ASX:FMG) announced a $500 million buy-back program to focus on operating performance and new investment.

The buyback will kick off after the 25 October for up to 12 months and be funded by its operating cash flows.

FMG’s CEO says buying back shares is a natural extension of its capital allocation, which has now shifted from debt reduction (with its gross debt at US$4 billion), after the company de-geared its balance sheet, taking its net gearing to 24 per cent.

Turning to what brokers say about the company, UBS has the miner as a buy with a price target of $5.75. 

All this comes as the iron ore price is at a three-month high US$70.39.

Shares in Fortescue Metals (ASX:FMG) are trading 0.54 per cent lower to $3.65
  

Jessica Amir

Finance News Network
Jessica joined FNN in January 2017 with a passion for equities and funds management. As Head of News, she has been a broadcast journalist for over seven years, specialising in finance. She has been a journalist with Sky News Business, ABC 1, ABC's The Business and ABC24. She’s also worked as a TV reporter for regional Channel 7 and 9. She also previously worked as a financial planner and real estate agent.