API Group's share price fell 0.75p today (17 December) to 24.25p after the packaging foil and laminates producer reported higher losses and said it planned to raise £8m, before expenses, through an open offer of new shares.
The group announced sales of £47.2m for the six months to 30 September, down 7.3% on last year. Meanwhile, operating loss decreased to £200,000 from £1m year-on-year.
API reported a pre-tax loss on continuing activities of £1.36m for the six months to 30 September, compared with £618,000 the previous year.
The firm plans to use the proceeds from the share issue of around £7.2m to repay £2.5m of loan facilities agreed with Steel and Wynnefield, and to reduce UK debt with an immediate repayment of £2m.
Non-executive chairman Richard Wright said the group was confident the financing arrangements would provide "sufficient working capital for the group's foreseeable requirements".
Following the recent restructuring of its laminate business, the directors said they were now concentrating on the supply chain for major luxury packaging companies in the alcoholic drinks, beauty, healthcare and tobacco sectors.
Growing European foil sales have been adversely affected by the shortage of standard foil grades from China. However, around 50% of machinery has now been relocated to a new Shanghai facility and production for export has started on the site.
API has reached a settlement with the purchaser of its Converted Product Division, which it sold in January 2005. This included the company's claim against the purchaser for deferred consideration of £750,000.
A settlement was reached after the purchaser made new claims over the closing valuation of the division's net assets.
The group announced sales of £47.2m for the six months to 30 September, down 7.3% on last year. Meanwhile, operating loss decreased to £200,000 from £1m year-on-year.
API reported a pre-tax loss on continuing activities of £1.36m for the six months to 30 September, compared with £618,000 the previous year.
The firm plans to use the proceeds from the share issue of around £7.2m to repay £2.5m of loan facilities agreed with Steel and Wynnefield, and to reduce UK debt with an immediate repayment of £2m.
Non-executive chairman Richard Wright said the group was confident the financing arrangements would provide "sufficient working capital for the group's foreseeable requirements".
Following the recent restructuring of its laminate business, the directors said they were now concentrating on the supply chain for major luxury packaging companies in the alcoholic drinks, beauty, healthcare and tobacco sectors.
Growing European foil sales have been adversely affected by the shortage of standard foil grades from China. However, around 50% of machinery has now been relocated to a new Shanghai facility and production for export has started on the site.
API has reached a settlement with the purchaser of its Converted Product Division, which it sold in January 2005. This included the company's claim against the purchaser for deferred consideration of £750,000.
A settlement was reached after the purchaser made new claims over the closing valuation of the division's net assets.
Source: packagingnews
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