Viomi Technology Co., Ltd Extends its Share Repurchase Plan

Rhea-AI Summary

Viomi Technology (NASDAQ: VIOT), a leading Chinese home water solutions company, has announced a 12-month extension of its share repurchase program. The plan, initially approved in October 2022 for up to US$10 million worth of American Depositary Shares (ADSs), will now extend through October 24, 2025. To date, the company has repurchased US$901,258 worth of ADSs in the open market. The company will continue funding the repurchases using its existing cash balance.

Positive

• Board's commitment to enhancing shareholder value through share repurchase program
• Company has sufficient cash balance to fund the repurchase program
• Extended timeline provides more flexibility for strategic share repurchases

Negative

• Only US$901,258 of the US$10 million authorization has been utilized since October 2022, indicating slow execution
• Significant portion of authorized repurchase amount remains unused after initial period

Insights

Financial Analyst

The extension of Viomi's share repurchase program, with $9.1 million still available from the original $10 million authorization, signals weak execution of the buyback strategy, with only $901,258 spent over the initial period. While share repurchases typically indicate management's confidence in the company's value, the minimal utilization here raises questions about the company's commitment to capital return or potential cash constraints.

The three-year timeframe through 2025 provides significant flexibility but also dilutes the potential near-term price support that a more aggressive buyback might offer. Given that only 9% of the authorized amount has been used so far, investors should moderate expectations about the program's impact on share value.

GUANGZHOU, China, Oct. 23, 2024 (GLOBE NEWSWIRE) -- Viomi Technology Co., Ltd (“Viomi” or the “Company”) (NASDAQ: VIOT), a leading technology company for home water solutions in China, today announced that as part of the Company’s continuous commitment to enhancing shareholder value, its board of directors (the “Board”) has approved an extension of its existing share repurchase plan for an additional 12 months.

On October 25, 2022, the Board approved the share repurchase plan to repurchase up to US$10 million worth of the Company’s American Depositary Shares (ADSs) during the period from October 25, 2022, to October 24, 2024. On October 23, 2023, the Board extended this plan for twelve months.

Under this extended share repurchase plan, the Company may repurchase up to US$10 million worth of its ADSs between October 25, 2022, and October 24, 2025. To date, the Company has purchased an aggregate of US$901,258 worth of its ADSs in the open market.

The Company plans to continue funding the repurchases under the share repurchase plan using its existing cash balance.

About Viomi Technology

Viomi’s mission is “AI for Better Water,” utilizing AI technology to provide better drinking water solutions for households worldwide.

As an industry-leading technology company in home water solutions, Viomi has developed a distinctive “Equipment + Consumables” business model. By leveraging its expertise in AI technology, intelligent hardware and software development, the Company simplifies filter replacement and enhances water quality monitoring, thereby increasing the filter replacement rate. Its continuous technological innovations extend filter lifespan and lower user costs, promoting the adoption of water purifiers and supporting a healthy lifestyle while effectively addressing the rising global demand for cleaner, fresher and healthier drinking water. The Company operates a world-leading “Water Purifier Gigafactory” with an integrated industrial chain that boasts optimal efficiency and facilitates continuous breakthroughs in water purification. This state-of-the-art facility enables Viomi to achieve economies of scale and accelerate the global popularization of residential water filtration.

For more information, please visit: https://ir.viomi.com.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates,” “confident” and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as Viomi’s strategic and operational plans, contain forward-looking statements. Viomi may also make written or oral forward-looking statements in its periodic reports to the United States Securities and Exchange Commission (the “SEC”), in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: the Company’s growth strategies; the cooperation with Xiaomi, the recognition of the Company’s brand; trends and competition in global IoT-enabled smart home market; development and commercialization of new products, services and technologies; governmental policies and relevant regulatory environment relating to the Company’s industry and/or aspects of the business operations and general economic conditions in China and around the globe, and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in the Company’s filings with the SEC. All information provided in this press release is as of the date of this press release, and the Company undertakes no obligation to update any forward-looking statement, except as required under applicable law.

For investor and media inquiries, please contact:

In China:

Viomi Technology Co., Ltd
Claire Ji
E-mail: ir@viomi.com.cn

Piacente Financial Communications
Hui Fan
Tel: +86-10-6508-0677
E-mail: viomi@tpg-ir.com  

In the United States:

Piacente Financial Communications
Brandi Piacente
Tel: +1-212-481-2050
E-mail: viomi@tpg-ir.com  

FAQ

What is the new expiration date for Viomi Technology's (VIOT) share repurchase program?

Viomi Technology's share repurchase program has been extended to October 24, 2025.

How much has Viomi Technology (VIOT) spent on share repurchases to date?

Viomi Technology has purchased US$901,258 worth of its ADSs in the open market to date.

What is the total amount authorized for Viomi's (VIOT) share repurchase program?

The share repurchase program authorizes the repurchase of up to US$10 million worth of Viomi's ADSs.

How is Viomi Technology (VIOT) funding its share repurchase program?

Viomi Technology is funding the share repurchases using its existing cash balance.