These Companies Lead Shareholder Returns with Proactive Treasury Stock Cancellation

Bold Moves by Coway and LG Uplus Draw Attention
"Strong Commitment to Shareholder Returns Secures Market Trust"

As the new government is pushing to introduce a mandatory treasury stock cancellation system, companies that have already been proactively canceling treasury shares before the policy implementation are once again drawing attention. Some companies are actively pursuing the purchase and cancellation of treasury shares as part of their value-up and long-term management strategies, regardless of whether the policy is implemented, taking the lead in building long-term trust with shareholders.

Treasury stock cancellation is a measure in which a company buys back its own shares from the market and then cancels them, thereby reducing the number of shares in circulation and directly increasing the value of existing shareholders' stakes. When the total number of shares decreases, earnings per share (EPS) rises, which can have a positive impact on the stock price. Above all, treasury stock cancellation serves as a clear signal to the market that the company prioritizes shareholder value, making its significance even greater.

Recently, Coway and LG Uplus have been cited as companies that have seen a significant rise in their stock prices and have attracted market attention due to expanded shareholder return policies such as treasury stock cancellation.

According to industry sources on the 21st, Coway has completed the cancellation of all approximately 1.89 million treasury shares (2.56%) it previously held. In addition, the company announced plans to sequentially purchase and cancel treasury shares worth 110 billion KRW by the end of this year. This is evaluated as a strategic measure aimed at building long-term shareholder trust, rather than simply boosting the stock price in the short term.

The market reaction to Coway's treasury stock cancellation announcement has been positive. After the agenda item was approved at the regular shareholders' meeting in March, Coway's stock price rose by more than 20% over two months, reaching 97,800 KRW as of June 20. This exceeds the KOSPI growth rate (18%) during the same period.

LG Uplus decided to cancel all 6.78 million treasury shares (1.6%) it held in the first half of the year in May, and also announced an additional treasury share purchase for the second half. LG Uplus's stock price has also risen by about 27% compared to the beginning of the year, reaching 13,220 KRW as of June 20, with several securities firms issuing positive reports, including raising their target prices.

In addition to these two companies, other large listed companies are also accelerating shareholder return efforts. Samsung Electronics has canceled treasury shares worth 3 trillion KRW and announced plans to purchase a total of 10 trillion KRW in treasury shares this year. LG Electronics announced plans to cancel about 760,000 treasury shares within the year, while KT is also pursuing the cancellation of treasury shares worth 250 billion KRW this year.

These companies, which have proactively engaged in treasury share purchases and cancellations, are being positively evaluated by the market and investors for focusing on building shareholder trust from a long-term perspective, beyond short-term stock price support or policy responses. A securities industry official analyzed, "In the past, treasury share purchases were simply regarded as a means of defending the stock price, but recently, shareholder return policies that include cancellation are being recognized as a practical means of realizing shareholder benefits," adding, "Companies that have proactively acted based on their commitment to shareholder returns are securing the trust of shareholders and the market."