Business
Proposed Placing
Proposed Placing.
About this update from Restore Plc
[{"type":"text","content":"\n RNS Number : 7215U Restore PLC 21 October 2010 \n \n\n7:00am 21 October 2010\n \nRestore plc\n(\"Restore\" or the \"Company\")\n \nProposed Placing of new ordinary shares to raise £4.0m\n \nThe Company is pleased to announce that it intends to raise £4 million (before expenses of £200,000) to strengthen the Company's balance sheet and provide capital for growth by the placing of 15,384,615 New Ordinary Shares at a price of 26p per share. \n \nThe Placing is conditional on the approval of Shareholders at a General Meeting, notice of which has been posted to shareholders of the Company today, and Admission. A copy of the circular will be made available on the Company's website at www.restoreplc.com\n \nBackground to the Placing and use of Proceeds\n \nAs noted in the Company's interim results announced on 7th September 2010, following the change in management in June 2009 the Company has moved to profitability in the first half of the current financial year. Trading was robust in the document storage business with operating profit up by 25%. The document scanning business operated profitably despite challenging market conditions which have continued since the half year end and Peter Cox, the damp treatment and timber proofing business, made a small contribution compared to a £0.4m loss in the first half of 2009. Head Office costs were reduced by over one-third and the closure of the business of ABS, which recorded a loss of £0.8m in the first half of 2009, has removed a drain on company profits and resources. Interest charges fell from £1.2m to £0.6m and will reduce further following the conversion of £8.0m of subordinated debt into equity in April 2010. The Company acquired Datacare in September 2010 which should further strengthen and increase the profitability of our document storage activities. \n \nThe Placing monies raised will strengthen the Company's balance sheet by reducing the indebtedness of the Group. In addition, the Placing will provide proceeds to allow the Company to take advantage of organic growth opportunities and potential acquisitions in the data management and broader support services sector as they arise. \n \nThe Placing will also widen the shareholder base of Restore which the Board believes will increase the marketability...