19th Aug 2014 09:33
LONDON (Alliance News) - City of London Group PLC Tuesday said "significant progress" is being made in reducing central costs, as it continues to squeeze what it has in the past called an "unsustainably high" central overhead cost.
In a statement, City of London Group said it has sub-let half of its office space and has sought to eliminate "all discretionary external costs". It also has reduced the number of full-time equivalent staff from nine to three, compared to this time last year.
The group has been focusing on cutting costs and raising capital amid a failed GBP17.4 million fundraising in December. In its last financial year, which ended March 31, City of London Group reported a GBP5.2 million loss, a widening from the GBP1.8 million loss reported for the prior year.
The group's troubles led it to adjust its focus to the provision of finance to small- and medium-sized enterprises. Trade Finance Partners Ltd, its 43% associate engaged in trade finance, is now fully utilising its existing GBP23.0 million Macquarie Bank Ltd facility, and expects shortly to step up its facility size, according to City of London Group. It added that growth "has been evidenced" both in SME lending and in commodity trade finance.
Meanwhile, City of London Group said that progress has been made towards securing a new partner for Therium, its 50% associate engaged in litigation funding, with discussions already underway with a number of parties. According to the statement, Therium has won four cases since March 31, with a partial loss on one case. Therium's investors committed GBP5.0 million to the cases, and their share of the awards, prior to expenses, amounted to GBP9.0 million. In addition, Therium also was appointed as litigation adviser to a new established GBP7.0 million award.
City of London Group is still looking for GBP30.0 million of debt funding to go alongside GBP10.0 million of conditionally committed equity in order to build economic scale in Credit Asset Management, its subsidiary providing loans to professional firms and lease finance to SMEs.
City of London Group shares were Tuesday untraded at 21.00 pence.
By Samuel Agini; [email protected]; @samuelagini
Copyright 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
CIN.L