7th Apr 2016 10:04
LONDON (Alliance News) - Ubisense Group PLC reported a widened pretax loss for 2015, as it completed the restructuring of its business in an effort to "right size", as revenue fell.
Ubisense also announced it has raised GBP4.8 million in a share placing in an effort to strength its balance sheet. It placed 19.2 million shares, or 34.4% of its enlarged share capital, at a price of 25 pence per share.
Shares in the company were down 8.9% at 36.00 pence Thursday morning.
Some directors, including Interim Chief Financial Officer Tim Gingell and newly appointed Chairman Peter Harverson, subscribed for a total of 2.2 million shares in the placing. Non-Executives Robert Sansom and Paul Taylor subscribed for 2 million and 80,000, taking their interest in the company to 5.0 million and 113,334 shares respectively.
Harverson and Gingell subscribed for 80,000 shares and 40,000 shares, in Gingell's case his only holding in the company. Harverson holds a total of 145,161 shares in the company following the subscription.
The placing is subject to shareholder approval, and Ubisense warned that if this approval is not received at an upcoming meeting, it will continue to be in covenant breach on its debt facility.
Ubisense reported a pretax loss of GBP17.3 million in 2015, widened from a pretax loss of GBP4.6 million a year before, as revenue fell to GBP22.0 million from GBP35.1 million, it reported higher operating expenses, and its amortisation and impairment of intangible assets increased.
The location intelligence services company said 2015 had been a "challenging year" as it acted to adjust its operating cost base to be better aligned with its reduced revenue expectations. Ubisense said it had been hit by weaker-than-expected demand at a time when it was investing for growth.
The company reset its revenue expectations for the second half of the year due to some orders being delayed in its RTLS division, and said that, once it became clear it would not be able to recover the shortfall, it had opted to re-align its costs.
Market conditions remain challenging, Ubisense said, so it it continues to be prudent in its expectations in the near term.
Ubisense said that trading in the first quarter of 2016 was slightly ahead of the previous year, as it signed four new contracts.
Following the completion of the placing Ubisense said it plans to review its long-term incentive arrangements in order to ensure it is able to "recruit and retain appropriate talent in key management roles". It plans to consult with some of its major shareholders ahead of proposing any new incentive plan.
"We took steps to right-size the business in the period, refocusing our resources on core geographies and reducing our staff base appropriately. Our focus for 2016 is very much on improved sales execution from a lower cost base in order to establish a financially stable platform from which we can then begin to address the growth potential of our market-leading solutions," said Harverson in a statement.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
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