The International Tobacco and Cigarettes Company Increases Company Capital by 21% through distribution of free shares

The International Tobacco and Cigarettes Company (ITC) held its Extraordinary General Assembly meeting on 16/4/2006. The meeting's proceedings were highlighted by all assembly members agreeing to the ITC board's decision to distribute 21.2% of the company's capital as free shares, and in light of their agreement to doing so, 3.2 million of the company's shares, valued at JD 1/ share and at a total value of JD 20 million, are thus going to be distributed to shareholders.

This decision stems from previous decisions made by the Board of Directors at ITC's previously held ordinary meeting of 14/3/06, during which it was decided that 25% of the firm's capital is to be distributed to shareholders as revenues valued at a sum of JD 4.125 million.

In the last two years, this marks the second time in which ITC raises its company capital, whereby in 2004 the company's capital was raised by 10% i.e. it was raised from JD 15 million to JD 16.5 million, and in light of the impressive financial achievements made by the firm in that year 20%, i.e. JD 3 million, of ITC's financial profits were also distributed to shareholders.

In the following table a historical record is made of the times in which ITC raised its company capital and the times in which it distributed its profit earnings to shareholders.

The above table shows that the company has adopted a policy in which it periodically yet gradually increases its capital make up, as it was established in the year 1992, 14 years ago, with a total capital of JD 5 million. This sum was raised to equal JD 10 million after ITC had undergone private placement in the year 1993. Further solidifying its financial position in the market, the firm raised its capital make up again by 20% in 1998, thus making the company's total capital equivalent to JD 12 million, and it did so through the distribution of free shares to shareholders. In the year 1999, the firm also distributed JD 2.4 million as financial profits, and in 2001 the firm also distributed 15% of its earnings from the business year of 2000 as profits, and the sum distributed that year was equivalent to JD 1.8 million.

In April 2001 the company's capital went up to JD 14.3 million, and this raise in capital was a direct result of ITC's merge with the Iqbal Company.  In the year 2002, ITC distributed 20%, i.e. JD 2.88 million, of its profit earnings made from the year 2001 to shareholders. The Jordan Securities Commission also agreed in the same year to the firm's decision to raise its capital by 15 million shares at the price of JD1 /share, and to having ITC register 4.88% of its profit earnings as capital.

In 2003, the firm also distributed 27.5%, i.e. JD 4.2 million, of its profit earnings to shareholders.  ITC also continued to make more profits in the year 2004 whereby it distributed 30% of these profit earnings to shareholders. The profits distributed that year were equivalent to JD 4 million and were the result of operations made during the financial year of 2003.

Commenting on the positive results achieved by the firm, Chairman of ITC Mr. Tawfeeq Fakhouri said, "I am proud of what ITC had achieved this year, but we want to see our operation move on to new heights in the future.  At present ITC occupies 50% of the local market share and we have created a well studied and long term strategy to increase our sales further in years to come. This is why we have decided to raise our company capital, and with this decision I hope to see more opportunities for advancement open up for our firm."

The Extraordinary General Assembly meeting ended on a positive note whereby Mr. Fakhouri thanked both Shareholders and investors for their belief in ITC and for contributing to the growth of its operations.  "Without your firm belief in ITC we wouldn’t be where we are today, so I want to thank you all for putting your trust in the firm, and for helping us achieve our goals," he added.