Real Good Food PLC Company Update (3461R)
21 September 2017 - 2:01AM
UK Regulatory
TIDMRGD
RNS Number : 3461R
Real Good Food PLC
20 September 2017
For immediate release
Real Good Food plc
("the Company" or "Real Good Food")
Company Update
In the RNS announcement on 29 August it was confirmed that the
three major shareholders, NB Ingredients Ltd, Omnicane
International Investors Ltd, and certain funds managed by Downing
LLP would, if required, provide additional funds to support the
Company's working capital requirements.
Further to this, these shareholders have since agreed to provide
to the Company a further short term debt facility in the case of
Omnicane International Investors Limited and NB Ingredients Ltd
(the "Loan Facility") and additional loan notes in the case of
certain funds managed by Downing LLP (the "Loan Notes"), of up to
GBP4.0 million, with each of the three shareholders participating
equally. The provision of these funds, supplementing the Company's
variable asset-backed lending facility in the short term, is
designed to relieve pressure on cash availability as the Company's
autumn stock-build increases in the lead up to the key Christmas
trading period and its capital investment programme continues to
progress. The Facility and the Loan Notes are secured on
unencumbered chattel assets of the Company.
The Loan Facility and the Loan Notes, which are intended to be
refinanced as soon as possible, include the following terms:
-- Up to GBP4.0m in aggregate, with a final repayment date of 30 September 2019.
-- An initial tranche of GBP1.5m will be drawn down immediately,
with further drawdowns possible in tranches of GBP500k.
-- A 10% coupon, accrued until the first interest payment in
March 2018, payable quarterly in arrears thereafter.
-- A premium of 10% payable on redemption if not repaid on or before 30 September 2018.
The Board considered alternative forms of funding and reviewed
the other options that may be available from other debt providers;
it concluded however that these would take too long to arrange for
the Company's short-term requirements and that this offer from
existing shareholders was therefore the most appropriate and
flexible option to meet the Company's short-term cash
requirements.
Christopher Thomas, Harveen Rai and Hugh Cawley, the Independent
Directors of the Company, having consulted with the Company's
Nominated Adviser, finnCap Ltd, consider the terms of the Loan
Facility and the Loan Notes to be fair and reasonable insofar as
the Company's shareholders are concerned.
The Board is pleased to announce that the first part of the
GBP11.0m investment at Haydens (the Yum Yum line) was commissioned
on time and the new product manufacturing line has delivered
product successfully and also on time last week. One of two new
product manufacturing lines at Renshaw is now producing stock for
the Christmas period and the new jam line at R&W Scott has
started to deliver product to a major retailer. The majority of the
remaining investment in new product manufacturing lines at both
Renshaw and Haydens is due to be completed by the end of December
2017. These substantial capital expenditure investments are key to
the Company's long-term growth plans.
Based on overall trading year to date, the Board now believes
that the Company will achieve EBITDA of approximately GBP6.5m in
the year to 31 March 2018 (prior to any exceptional costs incurred
during the year). The Company looks forward to seeing the full
operational and financial benefits of its capital expenditure
programme during the financial year commencing 1 April 2018
-Ends-
The information communicated within this announcement is deemed
to constitute inside information as stipulated under the Market
Abuse Regulations (EU) No. 596/2014. Upon the publication of this
announcement, this inside information is now considered to be in
the public domain.
ENQUIRIES:
Real Good Food plc
Chris Thomas, Executive Director Tel: 020 38573900
Harveen Rai, Finance Director
Andrew Brown, Marketing Director
finnCap Ltd (Nomad and Broker)
Matt Goode Tel: 020 7220 0500
Carl Holmes
Belvedere Communications (PR)
John West Tel: 020 3567 0510
Kim van Beck
About Real Good Food plc
Real Good Food plc is a diversified food business serving a
number of market sectors including retail, manufacturing,
wholesale, foodservice and export. The Group focuses on three main
markets: Cake Decoration (Renshaw, Rainbow Dust Colours), Food
Ingredients (Brighter Foods, Garrett Ingredients and R&W Scott)
and Premium Bakery (Haydens and Chantilly Patisserie).
This information is provided by RNS
The company news service from the London Stock Exchange
END
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