Multichannel specialist Findel wants to raise £80m of equity through a rights issue to pay down debt and invest in key areas.
Findel wants to rectify an “under investment in key areas” by ploughing £35m back into the business and paying £40m to lenders to reduce its debt, currently at £336.8m.
For the 26 weeks to October 1, Findel narrowed group losses from £22.7m to £15.5m. Group sales from continuing operations, which include Findel’s healthcare and education supplies divisions as well as retail, fell from £260m to £255.8m, which the retailer described as “stable”. In its home shopping arm, operating profits were up from £900,00 to £1.9m. Sales from continuing businesses were flat at £152.3m from £152.5m, which incorporates the Express Gifts and Kleeneze catalogues as well as online football kit retailer Kitbag.
Seymour Pierce analyst Freddie George was sceptical that funds could be raised. “The stock, in our view, remains firmly in the intensive room.” He said the management team have an “impressive record of turning around businesses”
but the equity raising will be a “major challenge”.