Business
Disposal
Disposal.
About this update from Coral Products Plc
[{"type":"text","content":"\n Coral Products PLC\n14 August 2007\n\n\n Press release\n\n Coral Products PLC\n\n Sale and leaseback of property\n\nFor immediate release\n 14 August 2007\n\n\nThe board of Coral Products plc (the 'Company') announces that the Company has\ntoday entered into a conditional agreement to sell the freehold interest in its\nproperty at North Florida Road, Haydock Industrial Estate, Haydock, Merseyside,\n(the 'Property' and the 'Disposal'). The Company will concurrently enter into a \nnew lease, enabling the Company to continue to operate from most of the\nProperty.\n\nUnder this proposal, the Company will sell the Property for cash consideration\nof £3 million to the purchaser of which £250,000 will be held in escrow as a\nrental deposit for the duration of the Company's occupation of the Property.\n\nIn view of the size of the Disposal relative to the market capitalisation of the\nCompany, the Disposal is conditional upon the approval of shareholders. This\napproval will be sought at an Extraordinary General Meeting to be convened\nshortly.\n\nCurrent trading and future prospects\nThe Directors issued an unaudited trading update to shareholders on 23rd March\n2007, based on management accounts. It included the following text: 'Trading has\nremained difficult and the improvement we saw towards the end of 2006 has not\nbeen maintained in 2007. Volumes in media based packaging have reduced and\nmargins have continued to be affected by discounted selling prices and increases\nto the cost base. Consequently the trading account for the year to 30th April\n2007 will result in a loss. We are presently moving into other markets where we\nare of the opinion that the future may be more predictable'.\n\nThe media markets continue to be under strain with lower margins resulting from\nmarket over-capacity. As a result, the Company is developing and seeking out new\nrelationships in other markets and has a clear strategy for moving forward.\n\nSince the publication of the above trading statement in March 2007 raw material\nprices (mainly plastics) have continued to rise. However there are indications\nthat some raw material prices may stabilise. The Company has been revising its\nselling prices upwards in response to increased raw material costs and\nanticipates that this will be accepted by its customers. Furthermore the Company\nhas obtaine...