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Statement
| 1.Date of the board of directors resolution:2022/07/08
2.Purpose of the share repurchase:
protect company reputation and shareholder equity.
3.Type of shares to be repurchased:common shares
4.Ceiling on total monetary amount of the share repurchase (NTD):
12,886,644,000
5.Scheduled period for the repurchase:2022/07/11~2022/09/07
6.No.of shares to be repurchased (shares):5,000,000
7.Repurchase price range (NTD):22.90~50.60, when the Company's share price is
lower than the minimum price, the repurchase will continue to be made.
8.Method for the repurchase: repurchase from the centralized trading market.
9.Shares to be repurchased as a percentage of total issued shares of the
Company (%): 1.34
10.Cumulative no.of the Company's own shares held at the time of reporting
(shares):0
11.Status of repurchases within three years prior to the time of reporting:
(1)Actual repurchase period: 2020/06/22 ~ 2020/08/20, scheduled repurchased
shares: 5000000, actual repurchased shares: 4189000, implementation
status (actual repurchased shares account for % of scheduled repurchased
shares): 84.00
(2)Actual repurchase period: 2020/03/16 ~ 2020/05/15, scheduled repurchased
shares: 10000000, actual repurchased shares: 10000000, implementation
status (actual repurchased shares account for % of the scheduled
repurchased shares): 100.00
12.Status of repurchases that have been reported but not yet completed:
No such situation.
13.Minutes of the board of directors meeting that resolved for the share
repurchase:
In order to meet the actual needs, the Company plans to implement the
sixth repurchase of treasury shares and repurchase 5,000,000 registered
common shares of the Company in accordance with Article 28-2, paragraph 1,
subparagraph 3 of the Securities and Exchange Act. The proposal is
submitted for resolution.(Proposing department: Stock Affairs Office)
Note: in order to meet the actual needs, the Company plans to implement
the sixth repurchase of treasury shares in accordance with Article 28-2 of
the Securities and Exchange Act. The main contents of the repurchase
purpose, types, total amount upper limit, quantity, repurchase period,
price range, impact and so on are as follows:
(1)The purpose of repurchasing shares: to repurchase shares in order to
protect company reputation and shareholder equity, and handle the
cancellation of shares.
(2)Types of repurchased shares: registered common shares of the Company.
(3)The maximum amount of shares repurchased: in accordance with Article 8
of the Regulations Governing Share Repurchase by TWSE-Listed and
TPEx-Listed Companies, the maximum amount of shares repurchased by the
Company is NT$12,886,644 thousand (the Company's retained earnings
plus the capital reserve from issuance premium ).
The upper limit of the amount required for this scheduled repurchase
of shares is NT$253,000 thousand (NT$50.6 × 5,000,000 shares).
(4)Scheduled repurchase period and quantity: the scheduled repurchase
period of this plan is from July 11, 2022 to September 7, 2022.The
number of shares repurchased is 5,000 thousand shares, accounting for
1.34% of the total issued shares of the Company (no further sale is
allowed according to regulations)
(5)Price range of repurchases: the upper limit of the repurchased share
price of the Company is NT$50.60 per share (150% of the average closing
price of 10 business days or 30 business days before the resolution of
the board of directors (the higher is NT$33.26 and NT$33.75
respectively), and the lower limit is NT$22.90 per share (70% of the
closing price of the Company on July 7). However, during the repurchase
period, when the Company's share price is lower than the minimum price,
the repurchase share will continue to be executed.
(6)Repurchase method: the Company plans to repurchase its own shares on
the centralized trading market and handle the repurchase of shares at
Mega Securities Co., Ltd. (Kaohsiung Branch Office and Sanmin Branch
Office).
(7)Total number of shares held in the Company: the Company currently does
not hold treasury shares.
(8)Declaration on the repurchase of the Company's shares in the previous
five years: please refer to the attachment for the record of
repurchasing the Company's shares in the previous five years.
(9)Repurchase that has been declared but the execution has not been
completed: there is no such situation.
(10)The total number of shares repurchased this time accounts for 1.34% of
the total number of shares issued by the Company, and the upper limit
of the amount required for repurchased shares is expected to account
for only 0.76% of the Company's current assets at the end of March
2022. The repurchased shares have taken into account the Company's
financial position and will not affect the maintenance of the Company's
capital. The statement of the board of directors of the Company is
attached.
(11)This repurchase of the Company's shares will be reported to the next
year's (2023) shareholders' meeting in accordance with regulations.
(12)During the period of this repurchase, in accordance with paragraph 6
of Article 28-2 of the Securities and Exchange Act, the shares of the
Company held by the directors, supervisors, and managers of the Company
and affiliated companies, their spouses, minor children, or in the name
of others, shall not be sold during the period of repurchase.
(13)The shares repurchased this time will be announced and reported in
accordance with relevant regulations.
Resolution: adopted without objection after the chairperson consulted the
directors present.
14.The Rules for Transfer of Shares set forth in Article 10 of the
Regulations Governing Share Repurchase by Exchange-Listed and OTC-Listed
Companies:
Not applicable.
15.The Rules for Conversion of Shares or the Rules for Subscription of
Shares set forth in Article 11 of the Regulations Governing Share Repurchase
by Exchange-Listed and OTC-Listed Companies:
Not applicable.
16.Declaration that the financial status of the Company has been considered
by the board of directors, and that its capital maintenance will not be
affected:
I.With the approval of more than two-thirds of the directors present at the
13th interim board of directors on July 8, 2022 and more than one-half of
the directors present, the Company repurchased 5,000,000 common shares of
the Company on the centralized trading market (the business premises of
securities firms) within two months from July 8, 2022, the reporting date.
II.The total number of shares repurchased above only accounts for 1.34% of
the issued shares of the Company, and the upper limit of the amount
required for repurchased shares only accounts for 0.76% of the current
assets of the Company. It is hereby declared that the board of directors
of the Company has considered the financial status of the Company, and the
repurchasing of the above shares does not affect the maintenance of the
capital of the Company.
III.This statement has been approved by the Company at the same board
meeting. The seven directors present agree with the contents and make this
statement.
17.Appraisal or opinion by a CPA or securities underwriter about the
reasonableness of the share repurchase price:
Evaluation opinions on the rationality of the repurchase price
In order to meet the actual needs, the board of directors of Kingtown &
Construction Co., Ltd. resolved on July 8, 2022 to repurchase the shares of
the Company in accordance with the provisions of subparagraph 3, paragraph
1, article 28-2 of the Securities and Exchange Act. It is estimated that
the total number of shares to be repurchased is 5,000 thousand shares. The
purpose for the necessary repurchase of the shares is to maintain the
Company's reputation and shareholders' equity, and handle the cancellation
of shares. The expected period and number of shares to be repurchased are
shown in the following:
Purpose of share repurchase: Necessary for protecting company reputation
and shareholder equity
Expected repurchase period: 2022.7.11∼2022.9.
Estimated number of repurchases (thousand shares): 5,000
The range of the repurchase price for the above purpose is set between
NT$22.90 and NT$50.60, which has been reasonably assessed by the CPAs as
follows.
I.Rationality of setting the price range for share repurchase
(1)Rationality of setting the repurchase price range
The price range of the Company's repurchased shares is between
NT$22.90 and NT$50.60, but when the Company's share price is lower than
the minimum price for repurchase, it will continue to carry out the
share repurchase. After the resolution of the board of directors on
July 8, 2022, its price determination process is legitimate.
(2)Rationality of setting the repurchase price range
The reference materials for the upper and lower limits of the Company's
price range are as follows:
Unit: NT$
--Upper limit: The average closing price of the 10 business days before
the resolution of the board of directors (2022.7.8) NT$33.26
The average closing price of the 30 business days before the resolution
of the board of directors (2022.7.8) NT$33.7533
150% of the higher of the two NT$50.63
--Lower limit: Closing price at the date of the board's resolution
(Note) NT$32.70 70% NT$22.89
(Note): The board of directors of the Company met before the opening of
the morning session on July 8, 2022 and therefore the closing price on
July 7, 2022 was adopted.
According to the relevant provisions of the "treasury stock Q&A" updated
by the Securities and Futures Bureau of Financial Supervisory Commission
on April 2019, the reasonable price range of the Company's share
repurchase this time is from NT$22.89 to NT$50.63. The board of directors'
resolution expects that the price range of the repurchased shares is
between NT$22.90 and NT$50.60, which meets the upper and lower limits of
the prescribed repurchase price, so the setting of the repurchase price
should be reasonable.
II.The possible impact and changes on the Company's financial status after
the repurchase of the Company's shares is made according to the
repurchase price range.
Unit: NT$1,000
Item (2022.3.31 (Repurchase all (Repurchase all
Financial report shares at the shares at the
figures) lower price limit) upper price limit)
Net worth per share attributable to the owner of the parent company (NT$)
NT$44.66 NT$44.96 NT$44.58
Simple earnings per share (NT$)
NT$0.64 NT$0.65 NT$0.65
Debt ratio 51.61% 51.78% 51.99%
Ratio of long term funds to fixed assets
3105.05% 3090.41% 3072.70%
Return on equity 1.45% 1.46% 1.47%
Current ratio 331.82% 330.68% 329.30%
Quick ratio 12.15% 11.01% 9.63%
Expected cash outflow for this execution
－ NT$114,500 NT$253,000
Note: the simple earnings per share is calculated based on the number of
issued shares of 371,759 thousand as of March 31, 2022, and the number of
outstanding shares calculated after deducting the estimated number of
treasury shares repurchased this time of 5,000 thousand shares as the
denominator.
Item As of the resolution date of the board of directors (July 8, 2022)
Number of issued and outstanding shares (in thousands): 371,759
Number of shares not eliminated or transferred in each previous exercise of
treasury stock: -
Number of shares eliminated or transferred in each previous exercise of
treasury stock: -
Maximum number of treasury shares that can be repurchased (in thousands)
37,175.9
Amount of treasury stock in previous executions
Item Amount Shares Cancelled or transferred
The fifth time 152,919 4,189 4,189
King's Town Construction Co., Ltd. repurchased shares in accordance with
the set repurchase price range, which mainly caused cash outflow. As of
March 31, 2022, the cash balance on the Company's account was NT$997,830
thousand, which was enough to cover the expenditure. From the above table,
it can be seen that the impact of this repurchase on the Company's
financial structure, net worth per share, earnings per share, return on
shareholders' equity, current ratio and quick ratio is still limited, it is
not likely to have a significant impact on the financial position of the
Company.
III. Conclusion
To sum up, the decision-making process of the price range set by King's
Town Construction Co., Ltd. for this repurchase of the Company's shares
is legitimate, and the determination of the price range and its impact on
the Company's financial position are within a reasonable range, and there
are no no material abnormality.
ShineWing Taiwan
CPA: Zhang Rui-Ling
July 8, 2022
18.Other matters stipulated by the SFB:NONE.
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