Align Technology Announces $250 Million Accelerated Stock Repurchase Agreement

Rhea-AI Summary

Align Technology (NASDAQ: ALGN) has initiated a $250 million accelerated stock repurchase (ASR) agreement with Citibank, part of its $1 billion stock repurchase program. This move showcases the company's strong cash flow and balance sheet health. Align's CFO emphasized confidence in growth opportunities and commitment to enhancing shareholder value through stock buybacks and strategic growth investments. CEO Joe Hogan and CFO John Morici also plan to personally purchase $1.0 million and $0.2 million of stock, respectively. The ASR is expected to conclude by April 26, 2023, and will be funded from the company's cash reserves.

Positive

• Initiating a $250 million ASR reflects strong cash flow and balance sheet.
• Demonstrates management confidence in growth opportunities.
• Shareholder value potentially increased through stock repurchase programs.
• CFO and CEO's personal stock purchases signal confidence in future performance.

Negative

• None.

Joe Hogan, president and CEO, and John Morici, CFO and executive vice president, global finance, intend to personally purchase $1.0 million and $0.2 million, respectively, of Align’s common stock

TEMPE, Ariz.--(BUSINESS WIRE)-- Align Technology, Inc. (“Align”) (Nasdaq: ALGN), a leading global medical device company that designs, manufactures, and sells the Invisalign® system of clear aligners, iTero™ intraoral scanners, and exocad™ CAD/CAM software for digital orthodontics and restorative dentistry, today announced that it has entered into a new accelerated stock repurchase agreement ("ASR") with Citibank, N.A. (“Citi”), to repurchase $250 million of Align's common stock under Align’s $1.0 billion stock repurchase program announced on May 13, 2021.

"We're pleased to announce this latest $250 million ASR, which reflects the strength of our balance sheet and cash flow generation, as well as management’s and the Board's continued confidence in our ability to capitalize on the large market opportunities in our target markets and trajectory for growth," said John Morici, Align CFO. "Returning capital to our shareholders through stock repurchase programs while simultaneously investing in our strategic growth drivers, is consistent with our capital allocation strategy and commitment to increasing shareholder value."

Our latest stock repurchase program will operate in accordance with guidelines, specified under Rule 10b5-1 of the Securities Exchange Act of 1934. Accordingly, transactions, if any, will be affected in accordance with the terms of the share repurchase program, including specified prices, volumes, and timing conditions. As of December 31, 2022, Align had approximately 77.3 million shares outstanding and $1.0 billion in cash, cash equivalents and short-term and long-term marketable securities.

Under the terms of the ASR, Align will receive an initial delivery of approximately 580 thousand shares. The final number of shares to be repurchased will be based on Align's volume-weighted average stock price during the term of the ASR, less an agreed upon discount. The ASR transaction is expected to be completed by approximately April 26, 2023 and will be funded with Align’s cash on hand.

Pursuant to the accelerated share repurchase agreement, Citi will use commercially reasonable efforts to conduct a portion of its hedging activity by effecting purchases through one or more designated brokers, including CastleOak Securities LP, Drexel Hamilton, LLC, and Siebert Williams Shank & Co., LLC.

In addition to the ASR, Align announced that Joe Hogan, president and CEO, and John Morici, CFO and executive vice president, global finance intend to personally purchase $1.0 million and $0.2 million, respectively, of Align’s common stock.

About Align Technology, Inc.

Align Technology designs and manufactures the Invisalign® system, the most advanced clear aligner system in the world, iTero™ intraoral scanners and services, and exocad™ CAD/CAM software. These technology building blocks enable enhanced digital orthodontic and restorative workflows to improve patient outcomes and practice efficiencies for over 239 thousand doctor customers and are key to accessing Align’s 500 million consumer market opportunity worldwide. Over the past 25 years, Align has helped doctors treat over 14.5 million patients with the Invisalign system and is driving the evolution in digital dentistry through the Align Digital Platform™, our integrated suite of unique, proprietary technologies and services delivered as a seamless, end-to-end solution for patients and consumers, orthodontists and GP dentists, and lab/partners. Visit www.aligntech.com for more information.

For additional information about the Invisalign system or to find an Invisalign trained doctor in your area, please visit www.invisalign.com. For additional information about the iTero digital scanning system, please visit www.itero.com. For additional information about exocad dental CAD/CAM offerings and a list of exocad reseller partners, please visit www.exocad.com.

Invisalign, iTero, exocad, Align and Align Digital Platform are trademarks of Align Technology, Inc.

Forward-Looking Statements

This news release contains forward-looking statements including statements regarding the expected completion date of the ASR transaction, the number of shares of common stock that will be repurchased under the ASR and the new stock repurchase program, Align's expectation that it will finance the ASR transaction and the new stock repurchase program with cash on hand as well as other statements regarding the ASR and the new stock repurchase program, and the anticipated amount and timing of purchases of stock by Align's president and CEO and CFO. Forward-looking statements contained in this news release relating to expectations about future events or results are based upon information available to Align as of the date hereof. Readers are cautioned that these forward-looking statements are only predictions and are subject to risks, uncertainties and assumptions that are difficult to predict. As a result, actual results may differ materially and adversely from those expressed in any forward-looking statement.

The foregoing and other risks are detailed from time to time in our periodic reports filed with the Securities and Exchange Commission, including, but not limited to, our Annual Report on Form 10-K for the year ended December 31, 2021, which was filed with the Securities and Exchange Commission on February 25, 2022 and our Quarterly Report on Form 10-Q for the quarter ended September 30, 2022, which was filed with the SEC on November 4, 2022. Align undertakes no obligation to revise or update publicly any forward-looking statements for any reason.

View source version on businesswire.com: https://www.businesswire.com/news/home/20230206005196/en/

Align Technology

Madelyn Valente

(909) 833-5839

mvalente@aligntech.com



Zeno Group

Sarah Johnson

(828) 551-4201

sarah.johnson@zenogroup.com

Source: Align Technology, Inc.

FAQ

What is Align Technology's stock repurchase plan?

Align Technology has announced a $250 million accelerated stock repurchase plan as part of its $1 billion stock repurchase program.

When will the ASR transaction be completed for ALGN?

The accelerated stock repurchase transaction is expected to be completed by April 26, 2023.

How much stock are Align's executives purchasing?

CEO Joe Hogan intends to purchase $1.0 million and CFO John Morici plans to buy $0.2 million of Align’s common stock.

What is the significance of the ASR for Align shareholders?

The ASR is intended to enhance shareholder value by reducing the number of shares outstanding and indicating management's confidence in the company’s financial health.