TIDMGYG
RNS Number : 6790G
GYG PLC
28 July 2021
The information contained within this announcement is deemed by
the Company to constitute inside information for the purposes of
Article 7 of Regulation (EU) No. 596/2014, as it forms part of
United Kingdom domestic law by virtue of the European Union
(Withdrawal) Act 2018. Upon the publication of this announcement
via a Regulatory Information Service, this inside information is
now considered to be in the public domain.
28 July 2021
GYG plc
("GYG", the "Company" or the "Group")
Financial and Trading Update
The board of GYG (the "Board") provides an update in relation to
various matters, as set out below.
Update re: Nobiskrug Shipyard and the Company's financial
position
The Company announced, on 13 April 2021, that administrators had
been appointed at the Nobiskrug Shipyard in Germany. The Company
has three active contracts and certain invoices outstanding,
relating to work completed in 2021 at the shipyard, totalling
approximately EUR2.8m (excluding VAT).
The Company has, since April, continued in constructive
discussions with the various parties involved, with a view to
agreeing a programme of works and a payment schedule for completion
of the contracts, which both minimises GYG's financial exposure and
achieves a satisfactory outcome for the end clients.
On numerous occasions during this period, it appeared to the
Board that a satisfactory resolution was imminent. The discussions
have, however, taken longer to conclude than the Board had
originally anticipated. Whilst the Board continues to be confident
in achieving a positive outcome for the Company, and none of the
outstanding balances due to the Company are in dispute, the Board
cannot guarantee a swift resolution to this matter.
Accordingly, the Board now expects that, as a result of the
continuing unforeseen delay in resolving the Nobiskrug situation,
in combination with the normal seasonal trading profile of the
business, the Company will suffer a temporary working capital
shortfall within the next one to two weeks, without an injection of
bridge funding.
Loan Agreement
Having regard to the current status of the situation at
Nobiskrug, the Company has agreed terms for North Atlantic Smaller
Companies Investment Trust plc ("NASCIT", an associate of Harwood
Capital LLP ("Harwood") , the Company's second largest shareholder)
to provide the Company with a short-term loan ("Loan" or "Loan
Agreement") for EUR3 million which will be advanced immediately.
The Company has, since 9 April 2021, been in an offer period (as
defined in The City Code on Takeovers and Mergers), with Harwood
identified as a possible offeror.
The Loan, which will be secured by way of an assignment over the
outstanding invoices related to work performed to date by the
Company for the Nobiskrug Shipyard, attracts interest at 10% p.a..
There are no arrangement fees associated with the Loan, which can
be repaid by the Company at any time without penalty on or before
its maturity date of 31 December 2021.
The Board intends to repay the Loan following resolution of the
situation at Nobiskrug and payment of the amounts owed to the
Company pursuant to the related outstanding invoices.
Related party transaction
NASCIT is a related party under the AIM Rules for Companies
("AIM Rules"), being an associate of Harwood Capital LLP, a
substantial shareholder. Entry into the Loan Agreement therefore
constitutes a related party transaction under the AIM Rules.
Accordingly, the Directors (each of whom is considered by the Board
to be independent of NASCIT), consider, having consulted with
Singer Capital Markets Advisory LLP, acting in its capacity as the
Company's nominated adviser, that the terms of the Loan are fair
and reasonable insofar as the Company's shareholders are
concerned.
Update on trading for the six months ended 30 June 2021
Turnover and activity levels across the Group were broadly in
line with the Board's expectations during H1 2021. This included
the benefit of some revenue deferred from Q4 2020, as previously
reported.
Overall, and, notwithstanding the ongoing situation at Nobiskrug
and the consequential effect on the Company's short-term funding
position as described above, the Board is broadly satisfied with
the Group's trading performance for the period and the order book
position remains strong.
The Company will release a more detailed update on trading, for
the six months ended 30 June 2021, during August.
Spanish Tax Authority - audit
The Company also announces that the Spanish Tax Authority has
recently conducted an audit into certain legacy tax matters
relating to a period several years prior to the Company's IPO on
AIM in 2017. The audit is now nearing its formal conclusion and
agreement in principle has now been reached as to the amount owed
by the Company. Accordingly, the Board has made a provision of
EUR1.1 million in the Company's accounts.
For further information:
GYG plc via FTI Consulting
Remy Millott, Chief Executive Tel: +44 (0) 20 3727 1000
Officer
Kevin McNair, Chief Financial
Officer
Singer Capital Markets Tel: +44 (0) 20 7496 3054
Tom Salvesen
Peter Steel, Amanda Gray
FTI Consulting Tel: +44 (0) 20 3727 1000
Alex Beagley
Fiona Walker
Rafaella de Freitas
Notes to Editors:
GYG is the market leading superyacht painting, supply and
maintenance company, offering services globally through operations
in the Mediterranean, Northern Europe and the United States. The
Company's brands include Pinmar, Pinmar Yacht Supply, and
Technocraft. GYG's operations can be divided into three key sales
channels:
-- Refit: repainting and finishing of superyachts, normally as
part of a refit programme. Revenues also include scaffolding and
containment work;
-- New Build: fairing and painting of new vessels as part of the build process; and
-- Supply: selling and delivery of maintenance materials,
consumables, spare parts and equipment primarily to trade
customers.
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