August 31, 2018 / 6:56 AM / 24 days ago

Swiss hearing aid group Sonova to buy back shares

ZURICH, Aug 31 (Reuters) - Sonova Holding AG will buy back and cancel up to 1.5 billion Swiss francs ($1.55 billion) worth of shares in a three-year repurchase programme set to start by October, the Swiss hearing aid maker said on Friday.

Its shares were indicated 1.3 percent higher in premarket activity. “In the last two years Sonova generated an annual operating free cash flow of over 400 million francs and expects continuing strong cash flow from future earnings,” it said.

The buyback would be funded by free cash flow and additional debt, targeting a net debt/EBITDA ratio of up to 1.0 times by 2020/21.

The share buyback is subject to regulatory approval.

“Maintaining a conservative financial policy, Sonova expects to have sufficient funds to further invest in R&D and capital expenditure, to expand the group’s distribution network and market reach and to undertake bolt-on acquisitions, in addition to the new share buyback programme,” it said.

The programme could be suspended should Sonova find an attractive opportunity for a large acquisition.

$1 = 0.9679 Swiss francs Reporting by Michael Shields; editing by Jason Neely

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