ARC Document Solutions has entered into an amendment to its credit agreement that increases the amount of restricted payments the company can make and exclude from its fixed charge coverage ratio. Such restricted payments include the use of cash for issuing dividends and repurchasing company stock. During a time when credit terms are generally becoming more restrictive, ARC‘s management attributed the favorable terms of its credit agreement amendment to its strong financial performance over the past several years and the continuing strength of its balance sheet. As part of its commitment to return shareholder value, ARC also disclosed the purchase of 506,403 shares of its own stock via open market transactions from April through the first three weeks of June. The number of shares represents 1.2% of ARC’s outstanding shares, and the average share price paid by the company during the period was $2.95. ARC’s trading window for purchasing its own shares during the second quarter closed on Thursday, June 22, 2023. At its most recent meeting in April, ARC’s Board of Directors authorized the expansion of the company’s previous $15 million share repurchase program to $20 million thru March 2026. Including the purchase of 506,403 shares of ARC stock announced today, the company has repurchased approximately 13% of its outstanding shares since 2019. Management expects to have approximately $10 million available for continuing share repurchases as of June 30, 2023.
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