15th Jul 2020 12:14
(Alliance News) - Grafenia PLC on Wednesday announced it is to issue up to GBP50 million of perpetual bonds and has issued GBP3 million to investors, raising approximately GBP2 million before expenses.
The bonds will be issued at 67% of their nominal value with no interest for three years, after which there will be an interest rate of 6% per annum. The bonds will be non-convertible and unsecured, ranking side by side with any future bonds.
Grafenia Chief Executive Peter Gunning said: "People are contemplating what the future looks like and are considering their options. We're seeing potential opportunities to grow our network.
"We like the mechanism of the bond. As we see future attractive acquisition opportunities, we can access capital as necessary. We did consider raising equity, but the Board decided that this bond was better for shareholders as it's not dilutive."
The Manchester-based printing business said its March revenue was 65% of the previous year's.
In May, the company's sales climbed by more than 50% compared to April, but still only around 40% of last year over the same month.
Grafenia turned it around in June when sales were back to 90% to last year's with strong sales of Covid-19 related products.
The company however said it is too early to predict trading in July and the rest of the summer.
During the three months of lockdown, Grafenia added 14 new Nettl partners in the UK, two in the Netherlands and three in the US. All training programs have now moved online, with a mix of pre-recorded content and live group sessions.
Nettl web studios help local businesses with the setup of their websites or web shops.
"With our diverse product range, from mobile websites to stadium wraps, we aren't as reliant on printing sales as we once were. Having a partner network under contract gives us a degree of stability. Nevertheless, it's difficult to forecast what will happen to our clients and general business activity, in the rest of the year," Gunning said.
Grafenia shares were up 1.9% at 7.90 pence each at midday on Wednesday in London.
By Greg Roxburgh; [email protected]
Copyright 2020 Alliance News Limited. All Rights Reserved.
Related Shares:
GRA.L