18th Mar 2015 09:50
LONDON (Alliance News) - AIM-listed Quoram PLC Wednesday said it has opted against buying its own shares on the open market as a means to boost trading volumes and narrow the discount at which they trade to net asset value.
In a statement, the company said that the need to complete a share capital reduction has proven to be prohibitive to a potential share buyback.
"Given the discount at which the group's shares trade to net asset value, the board has reviewed the potential for share buybacks as a means of providing liquidity and accreting shareholder value. However, given the need to complete a process of share capital reduction it was concluded that the cost of such an exercise was likely to outweigh the potential benefits," Quoram said in a statement.
The news came as Quoram reported that net assets increased to just under 0.29 pence per share in December 2014, compared with 0.26p per share in June that year and 0.25p in December 2013. Cash balances fell to GBP1.6 million from GBP1.7 million during the six months ended December 31, 2014. The company reported a GBP1.4 million net profit for the six months ended December 31, 2014, compared with a GBP778,000 net loss in the corresponding period the prior year.
"While Quoram benefits from a low cost base and simple corporate structure, it retains the capacity to execute further investment opportunities when they arise on appropriate terms. Combined with a strong liquidity position, the group is in a robust position and will inform investors of future developments when they arise," Quoram said in a statement.
Quoram shares were untraded on Wednesday. The stock closed at 0.19 pence on Tuesday.
By Samuel Agini; [email protected]; @samuelagini
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