9th Apr 2020 18:29
(Alliance News) - Surface Transforms PLC on Thursday said that it has raised GBP1.4 million via placing 10.8 million shares at 13 pence each to continue operating should Covid-19 impact the business in a material manner.
The company, which manufactures carbon fibre reinforced ceramic materials, also intends to launch a share open offer for up to 2.3 million shares at 13p per share, to raise further GBP300,000
The share issue price represents a discount of 16% to 15.5p share closing price on Wednesday. Shares in the company on Thursday closed 9.7% lower in London at 14.00p each.
The company's management, including Chair David Bundred, Chief Executive Kevin Johnson, Chief Financial Officer Michael Cunningham and Non-Executive Directors Richard Gledhill and Kevin D'Silva have decided to purchase around 1.5 million in the share placing.
Proceeds from the placing will provide Surface Transforms with sufficient working capital to enable it to continue operating should Covid-19 impact the business in a material manner.
"The board has modelled various scenarios and a working capital buffer of GBP1.3 million is sufficient even were forecast revenues to fall approximately 50% to GBP1.6 million for the year ending 31 December 2020," the company said.
The company additionally said that it has applied for a Coronavirus Business Interruption Loan, but does not yet know whether their application has been successful. It has also taken actions to reduce its costs including furloughing 50% of employees, delaying non-essential expenditure, cutting executive pay and cancelling bonuses.
By Tapan Panchal; [email protected]
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