Findel in cash call
FINDEL, the home shopping and educational supplies company, is planning to raise £81m through an equity issue to help to cut its debts.
The Yorkshire company, whcih has an eductional division in Tameside, said it had faced a challenging period, but it believed the capital raising would improve its performance by enabling it to have cheaper banking facilities.
In its results in the 12 months to April 3 Findel saw pre-tax losses of £51.9m against a profit before tax of £25.2m the year before.
Findel has been hit by falling sales and has been in talks with its lenders about finding ways of reducing its debts.
It said it wants to deliver £100m of cash generation by the end of March 2011.
Findel chairman Keith Chapman said: “This £81m capital raising allows us both to accelerate the group’s debt reduction plan and enter into cheaper and less restrictive bank facilities.
“This, together with the company’s focused strategy of stability, efficiency and cash generation, means we are better capitalised to operate in the current economic environment and to emerge well placed for future growth.”
He added: “Faced with difficult trading conditions the board responded early with a strategy to tightly control costs and bad debts, and to maximise cash flow in order to pay down debt.”
Findel has also agreed amended credit facilities with its lenders.
In the year to April 3, sales from continuing operations were £599.8m, down from £610.6m the previous year.
Findel said trading was in line with expectations, with group sales from continuing operations for the 15 weeks to July 17, four per cent below the same period last year.
