Phoenix Expands Share Buyback Program to 400 Million Shekels by 2026

Phoenix Insurance announced an expansion of its share buyback program by an additional 100 million shekels, increasing the total program size to 400 million shekels by 2026. This follows the original 300 million shekel plan approved in December last year. The decision came after the company nearly exhausted the initial budget, having used approximately 269 million shekels to repurchase 1,655,725 shares on the Tel Aviv Stock Exchange. The accelerated buyback pace was especially notable since the first quarter of 2023, when the company repurchased about 85 million shekels worth of shares, with the majority of the additional 184 million shekels spent between April and mid-July.

The expanded buyback will be fully funded from Phoenix’s own resources without incurring debt. Share buybacks reduce the number of outstanding shares, increasing the relative ownership and future earnings per share for remaining shareholders without additional investment. This method is also tax-efficient compared to cash dividends, as it defers tax liabilities until shares are sold. Phoenix confirmed compliance with all legal distribution tests, supported by a distributable surplus of approximately 12.9 billion shekels as of March 31, 2023.

The board highlighted that previous buyback programs yielded a cumulative return of about 132%. The company expects the expanded program will not materially affect its capital structure, leverage, or liquidity. Phoenix’s dividend policy targets a total payout of at least 55% of annual profits, with a minimum cash dividend floor of 45%. In Q1 2023, Phoenix paid 320 million shekels in cash dividends and repurchased shares worth 85 million shekels, returning a total of 405 million shekels to shareholders, about 57% of profits. Since then, the company has continued accelerated share repurchases totaling 184 million shekels.