7th Nov 2014 08:47
LONDON (Alliance News) - Regenersis PLC Friday said it is planning a capital reduction to increase its distributable reserves for potential dividends or share buybacks, and will ask shareholders for permission to conduct the plan at a general meeting on November 26, the same day as its annual general meeting.
It said its accounts for the year ended June 30 showed it to have an accumulated profit on its distributable profit and loss account of GBP3.5 million and a balance on its share premium account of GBP121.7 million.
That has build up after the company issued shares at a premium to their nominal value in the past three years. The technology outsourcing company has expanded rapidly since 2011 and it has used distributable reserves to fund the costs associated with merger and acquisition activity, amongst other things.
A share premium account is an undistributable reserve and its uses are extremely restricted. It cannot be used for paying dividends or undertaking share buybacks, for example.
"The board is therefore recommending that a proportion of the amount held in the share premium account be reduced and transferred to the company's profit and loss account to create further positive distributable reserves, in order to give the board the flexibility to distribute profits to shareholders as dividends, or possibly by way of share buybacks, if it is considered appropriate at the time," it said.
Regenersis shares were down 1.2% at 225.23 pence early Friday.
By Steve McGrath; [email protected]; @stevemcgrath1
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