4th Sep 2006 16:11
Mercury Group PLC04 September 2006 4th September 2006 MERCURY GROUP PLC ("the Company") TRADING UPDATE In the interim statement issued, on 28 June 2006, reference was made to theslippage in the timing of some key contracts throughout the business, which wereexpected to affect results adversely for the year to 30 September 2006. Inaddition, it was stated that the results for the year would includenon-recurring costs totalling £450,000, relating to an aborted acquisition and arestructuring programme. Since issuing the interim statement, all three of the Company's operatingsubsidiaries have experienced difficult trading conditions and the cash balancereported as at 31 March 2006 of £805,000 has now been very substantiallyreduced. The resulting working capital constraints have been further compoundedby a number of large unpaid debts, which are proving difficult to recover. TheCompany is rigorously pursuing the recovery of these debts, including takingappropriate legal action where necessary. Whilst the Company does not presently have any bank borrowings, it is clear tothe board that the Company urgently needs to raise additional long term capitalto alleviate the current working capital constraints and to provide asufficiently strong financial base from which to rebuild the business. The boardis currently exploring the raising of additional capital by way of a placing ofordinary shares with its principal shareholders. Any such placing would belikely to be priced at a material discount to the current share price. A furtherannouncement will be made in due course. For Enquiries: Mercury Group plc 07887 576111Walter Goldsmith (non-executive chairman) This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
MGP.L