Hyundai Mobis Enhances Shareholder Value Through Preemptive Investment and Shareholder Returns

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Feb 14, 2023, 21:15 ET

Announced 2023 Shareholder Value Maximization Policy, including the plan to purchase KRW 150 billion worth of treasury shares, which will all be cancelled.
To secure additional cash to gain a competitive edge in future business and combat global uncertainties through external investment.
To establish a BOD with diversity, expertise, and independence.

SEOUL, South Korea, Feb. 14, 2023 /PRNewswire/ -- Hyundai Mobis (KRX 012330) announced the 2023 Shareholder Value Maximization Policy on 14th. The company intends to maximize shareholder value with balance between investment for future growth and shareholder return policy.

Hyundai Mobis unveiled a cash utilization plan in its 2023 Shareholder Value Maximization Policy. Essential plans include KRW 5-6 trillion (approx. USD 4.5 billion) for organic growth in electrification and core components aimed at gaining a competitive edge; KRW 3-4 trillion (approx. USD 3 billion) for in-organic growth in autonomous driving, advanced driver assistance systems (ADAS) and software; and KRW 5 trillion (approx. USD 4 billion) in cash buffer for responding to economic downturns and other crises that may arise.

The company will also continue to maximize shareholder value by achieving a balance between future investment and shareholder returns. While keeping the stock prices up for the mid- to long-term by investing in future mobility, such as software and semiconductors, Hyundai Mobis will also carry out measures flexibly to increase shareholder value through dividends, buybacks, and cancellations.

The key to the future growth strategy can be summed up as a preemptive investment with a view to strengthening both internal and external competitiveness. Hyundai Mobis will continue its R&D to improve future mobility competitiveness in core parts, including electrification and electronic components. The company will also expand order intakes from global automakers to strengthen its position as a global supplier.

In addition, Hyundai Mobis will strive to make external investment through strategic M&A, including autonomous driving and pertinent software. Hyundai Mobis will also seek out and invest in new businesses that will serve as the long-term growth engine, such as advanced air mobility (AAM) based on its innovative technologies.

This year's dividend will be operated flexibly at 20-30% of the payout ratio based on net profit excluding the equity method. The current interim dividend will also be maintained. Hyundai Mobis will purchase KRW 150 billion (approx. USD 118 million) worth of treasury shares, which will all be cancelled. Taking into account the funds required for the large-scale investment plan in electrification projects in North America, the company will maintain the flexible approach it has taken the previous year to the amount of the treasury stock it purchases annually.

Hyundai Mobis faithfully carried out the shareholder returns policy worth a total of KRW 2.6 trillion (approx. USD 2 billion) after announcing the three-year mid- to long-term shareholder returns policy in 2019. Starting last year, Hyundai Mobis began paying dividends on an annual basis. The company purchased KRW 313.2 billion (approx. USD 246 million) of treasury stocks, and retired KRW 62.5 billion (approx. USD 49.2 million) of treasury stocks it already owned.

The company also proposed a new composition of the Hyundai Mobis Committee. At the committee meeting held on the same day, members resolved to reappoint Hyundai Motor Group Executive Chair Chung Euisun as an internal director and Chang Young as an independent director.

As for an independent director specialized in industrial management, the Chairman and CEO of AMCHAM Korea, James Kim, was newly recommended. The incoming director, James Kim, has a strong background in business management as a former CEO of GM Korea, Microsoft Korea, and Yahoo Korea. He is also a mobility and software expert. The appointment of new directors will be confirmed at the Annual General Meeting (AGM) scheduled for March.

Accordingly, the Hyundai Mobis Committee will be comprised of five independent directors with an emphasis on diversity, expertise, and independence. The greatest minds in the industry, finance, logistics, and governance will become the members of the committee. The addition of new director Kim is expected to propel Hyundai Mobis toward the next stage of growth in future mobility.

Hyundai Mobis plans to approve the total sum dividends of KRW 4,000 per share including the interim dividend, which is the same amount as in the previous year, at the 46th AGM scheduled for March 22, 2023.

About Hyundai Mobis

Hyundai Mobis is the global no. 6 automotive supplier, headquartered in Seoul, Korea. Hyundai Mobis has outstanding expertise in sensors, sensor fusion in ECUs and software development for safety control. The company's products also include various components for electrification, brakes, chassis and suspension, steering, airbags, lighting, and automotive electronics. Hyundai Mobis operates its R&D headquarters in Korea, with four technology centers in the United States, Germany, China and India. For more information, please visit the website at http://www.mobis.co.kr/

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SOURCE Hyundai Mobis