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| Subject: ERG looks ahead with $67m raising=five-for-four=issue of shares at 20c apiece | |
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Author: July 2, 2004 |
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Date Posted: Friday, July 02, 06:59:23pm In reply to: Newspapers reporting result--March 7 2003 SMH 's message, "Noteholders have tickets to ride" on Thursday, March 06, 08:38:56am ERG looks ahead with $67m raising By Anthony Hughes July 2, 2004 Page Tools Email to a friend Printer format Downtrodden transport ticketing systems provider ERG is hoping to make a fresh debt-free start after last night moving to raise $67 million through a renounceable rights issue. It is understood that ERG, through underwriter Patersons Securities, was raising the money through a five-for-four issue of shares at 20c apiece, well below ERG's 6c stronger close of 60c. ERG was one of the worst performing stocks during the last financial year, falling 33 per cent, but is now hoping to extinguish all of its remaining debt to finally focus on improving its margins. The stock will be placed in a trading halt from this morning as it finalises the issue. ERG said in a statement last night the rights issue was the final element of a plan outlined in late 2002 to restructure the group's capital base. The raising would "fund the renegotiation and extinguish-ment of liabilities relating to the now divested Proton World business" and "provide working capital for contracts in progress". Advertisement Advertisement It would materially strengthen the balance sheet "at a time when the new management team is making good progress in its business strategy to turn ERG into a profitable supplier of world class multi-application smart card solutions". In the first half ERG reported a net loss of $43 million, despite predicting a "small loss" at last year's annual meeting. New chief executive Allan Sullivan said in March he recommended several one-off charges and a more "conservative view on accounting issues". The company did not expect a profit for the financial year just ended but "continuing to stay on track will be the key driver for profitability", he said. He has predicted a profit this financial year. He said the company needed to keep its balance sheet healthy and its exposure to new projects "must be managed by seeking banking partners to assist with the funding requirements, achieving milestone payments and negotiating for customers to buy and own the equipment". "If we can maintain or even strengthen our balance sheet, the flow-on effects for our ability to finance projected cash flows, including performance bonds, is dramatically enhanced." Top of Page Page Tools Email to a friend Printer format More news Agribusiness tax schemes reap bumper crop of investors Forbes has a word of advice for Australia Cheap electricity a threat to AGL's Loy Yang purchase [ Next Thread | Previous Thread | Next Message | Previous Message ] |
| Subject | Author | Date |
| Utah and New Zealand contracts awarded to ERG | 13-April-06 by Edited announcement | Thursday, April 13, 08:30:05pm |