Fyffes announces buy-back of shares

Fruit group Fyffes has announced a buy-back of its shares, buying up one million shares at 82 cent per share on Wednesday evening, according to a notice issued to the Irish Stock Exchange yesterday morning.

A spokesman for the company said it was buying back shares because it felt there was good value in the share price at the moment due to the ongoing tur-bulence in stock markets.

Fyffes closed up one cent at 82 cent yesterday, bucking the overall trend on the Iseq index of Irish shares, which fell almost 1.5 per cent, as European markets tumbled again.

There was a large volume in trading again in Fyffes yesterday, with 4.3 million shares changing hands.

The market responded well to the company's interim results earlier this year, in which the fruit distributor reported a significant but expected decline in first-half profits but said it was on track to meet market expectations for the full year.

The company has authorisation to purchase up to 10 per cent of its issued share capital as a result of standard resolutions made at its annual general meetings.

However, the spokesman said this did not mean it would buy back the full 10 per cent. The block of shares bought back on Wednesday represents 0.275 per cent of the ordinary shares in issue.

Paul Meade, a food sector analyst at NCB Stockbrokers, said a full 10 per cent buy-back at 82 cent could add about 5 per cent to its earnings in a full year.

The Fyffes spokesman said there was plenty of cash on the Fyffes balance sheet but that this would be used mainly for acquisitions.