UPDATE 2.40pm: Orbital Corporation has announced a share buyback of up to 10 per cent of its stock, saying it believes the company is undervalued.
Orbital chairman Merv Jones said the board believed the Orbital share price did not reflect fair value of the group, particularly considering the underlying value of the Synerject business and the developing small unmanned aerial systems business.
"Our continued transition from a consulting services business to a systems supply business gives the board confidence to approve this capital management measure," he said.
"The share buyback reflects the board's goal of returning value to shareholders and maintaining a strong balance sheet."
The buyback will begin on July 14 and continue for a year. It will be dependent upon share price, market conditions and other considerations with all bought back shares cancelled.
Orbital shares closed up one cent, or 6.9 per cent, to 15.5 cents.