1st Apr 2015 08:57
LONDON (Alliance News) - SnackTime PLC Wednesday said the financial year that ended Tuesday was "challenging", and it expects revenue and earnings before interest, tax, depreciation and amortisation to have declined due to the failed sale of Drinkmaster, a decreasing vending estate and pressure on wholsesale revenue.
The vending machine company said it expects Ebitda for the year ending March 31 to halve to GBP550,000 from GBP1.1 million the year before, while sales are expected to drop to GBP16.7 million from GBP18.8 million.
It said it booked an exceptional cost of approximately GBP650,000 representing the cost of its equity issue and bank negotiation in November, personnel reductions and other reorganisation costs.
The company called off the planned sale of its Drinkmaster business last year after potential buyer interest waned when the unit lost some of the business it had with its largest customer, William Hill PLC.
SnackTime said it has repaid GBP1.2 million of bank borrowing and was under obligation to repay a further GBP240,000 by year-end. It said that its earnings before interest, tax, depreciation and amortisation level has resulted in a "minor breach" of the Ebitda/interest cover covenant and that the company's bankers have agreed to waive the breach and suspend future covenant testing until September.
"The combination of the new management team led by CEO Mark Stone who was appointed on 2 January 2015 and the full backing of our strong international partner Uvenco both point towards a very positive and exciting future for SnackTime," the company said in a statement.
"The solid foundations we have been building in early 2015 have already started to bring benefits for our immediate future. We have secured new contracts in our vending division worth GBP2.5 million in operated revenue over a five year period which will commence in June 2015, Drinkmaster is enjoying the challenges of delivering for its new 'Sealcup' product and our Snack in the Box franchise network continues to grow on a monthly basis," it continued.
The company also noted that it intends to change its financial year-end to December 31, effective from that date. In the short term, it will report audited final results for the year ended March 31, unaudited interim results for the six months to September 30, and audited final results for the nine months to December 31.
Shares in SnackTime were trading down 2.4% at 7.32 pence Wednesday morning. The stock is down nearly 19% so far in 2015 and is down 24% over the last 12 months.
By Karolina Kaminska; [email protected] @KarolinaAllNews
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