Engineering group AMEC said it would launch a £400m share buyback programme and raised its dividend by 15 per cent, as it posted a jump in 2011 profit alongside a positive outlook for the current year.
AMEC, whose customers operate in the mining, oil and gas, nuclear power and renewable energy sectors, on Tuesday reported full-year earnings before interest, tax and amortisation (EBITA) of £299m, 12 per cent higher than in 2010, and slightly higher than forecast.
The average forecast for AMEC’s EBITA stood at £297m according to a company supplied poll of 16 analysts.
“We are announcing a 15 per cent increase in the dividend for the full year and, given the strength of the group’s balance sheet, are commencing a £400m share buyback programme, which is expected to be completed over the next 12 months,” chief executive Samir Brikho said in a statement.
Investors in AMEC have been waiting for news on a cash return after the company said last March it would consider a buyback or one-off return should a major acquisition not materialise, something which to date has not happened.
AMEC said it would lift its full year dividend to 30.5 pence per share from the 26.5 pence it paid out in 2010.
“The outlook for 2012 is underpinned by the positive industry backdrop and the strength of the order book,” Brikho added.
Shares in AMEC, which have gained 23 per cent in the last three months, closed at 1,108 pence on Monday, valuing the company at about £3.7bn.