Business
Notice of GM and Proposed Capital Reduction
Notice of GM and Proposed Capital Reduction.
About this update from Premier Foods Plc
[{"type":"text","content":"\n \n \n \n RNS Number : 5177I\n Premier Foods plc\n 14 December 2020\n \n \n \n \n \n \n \n \n \n \n 14 December 2020\n \n \n \n \n \n Premier Foods plc (\"Premier Foods\" or the \"Company\")\n \n \n \n \n \n POSTING OF CIRCULAR AND NOTICE OF GENERAL MEETING TO APPROVE A CAPITAL REDUCTION\n \n \n \n \n \n Premier Foods announces that a shareholder circular (the \"Circular\") detailing a proposed reduction of capital of Premier Foods (\"Proposed Capital Reduction\") and a notice convening a general meeting of Premier Foods (the \"General Meeting\") to consider and approve the Proposed Capital Reduction will be posted to shareholders today.\n \n \n \n \n \n Proposed Capital Reduction\n \n \n Over the course of the last year Premier Foods has successfully completed its strategic turnaround programme. This has involved: \n \n \n \n \n \n · \n the introduction of a new management team;\n \n \n · \n the completion of its Strategic Review, with a landmark agreement with its pension schemes; and\n \n \n · \n a consistent trading record and accelerated reduction in Net debt.\n \n \n \n \n \n As a consequence of recent positive trading and improved cash flow, the Company has also been able to repay £120m of its Floating Rate Notes due July 2022. In addition, as reported at the Company's recent half year results for the 26 weeks ended 26 September 2020, Net debt has been reduced to £382.8m on a pre-IFRS 16 basis (£403.1m, post-IFRS 16), and Net debt/EBITDA reduced to 2.3x on a pre-IFRS 16 basis. \n \n \n \n \n \n These actions have significantly improved the Company's financial position. The Company currently has a profit and loss account deficit which, as at 24 October 2020, amounted to £460.3m (on an unaudited pro forma basis). At the same date the Company's share premium account showed a positive balance of £1,409.8m (on an unaudited pro forma basis). \n \n \n \n \n \n The share premium account is an undistributable reserve and, accordingly, the purposes for which the Company can use it are extremely restricted. The Company is therefore proposing a capital reduction in order to cancel the amount standing to the credit of the share premium account and to transfer it to the Company's profit and loss account. The realised profits thereby created would be applied to increase...