News blog
WYG
- BY: Andrew Hore |
- POSTED: 16/06/2011 |
Construction and environmental consultancy WYG is restructuring its capital in order and raising £30m after expenses in a highly dilutive placing.
The size of the fundraising did not go down well with investors and the share price slumped by 5.25p to 7.5p. That values WYG at £2.65m, which shows how dilutive the placing will be. A £58m debt facility is due to expire in December 2012. The covenants on the facility become tougher at the end of June and WYG is unlikely to comply with them when they are next tested on 14 August.
Net debt was £29.2m at the end of March 2011. WYG wants that debt to be swapped for convertible shares. The lenders have to support the proposals for them to go ahead. There are also £30m of preference shares in issue and they would be converted into deferred shares.
Potential new shareholders have already been sounded out.
The group’s cost base has been slashed by £110m since 2009 and the focus is on four markets: buildings and critical infrastructure, transport, energy and environment and assurance services.
Revenues were £121.5m in the nine months to March 2011. Although annualised revenues were lower, international revenues increased 8% on an annualised basis. There was a small underlying operating loss but the business was cash generative. Exceptional charges meant that the reported loss was £28.6m but the majority of those costs were non-cash write-offs.
The UK and Ireland remains tough.
Download the June 2011 edition of AIM Journal at http://www.hubinvest.com/AIMPDFJune2011_21.pdf
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