Shares in Countrywide ticked up after the firm put out a statement saying that its lenders will support the business as it ‘restores’ its sales and lettings activities back to profitable growth.
The statement said: “Countrywide plc, the UK’s largest integrated property services group, announces that on February 2 the Company agreed an amendment letter relating to its term and revolving credit facility with its lender partners which provides the Company with the financial flexibility to invest in the business as it takes action to restore the sales and lettings business back to profitable growth.”
Shares on Friday went up to 93p – still under the 100p milestone where it sank when CEO Alison Platt left the business last month, but an improvement on the sub-90p to which the shares fell before Friday’s statement, which was issued under the headline: “Countrywide plc amends finance facilities.”
Last month, Countrywide issued a profits warning.
Comments (4)
A heavyweight contender?
They have no other choice but to support them The patient is still sick .They achieved their aim of ousting Platt but still require them to take action They will want to see a heavyweight appointment which will then enable CWD to go back into the market with another placing say £50m which will reduce the debt pile take the heat off.
Some posters here think just because the debt is manageable its OK its not CWD are being run by their bankers and until they get a clear business plan of how its going to be reduced this will still be the case
However this is unlikely to benefit the private investor especially in the short term This will buck back below 90p
Make your mind up last week you had the banks calling in the debt!
Smile Please
You really need to acquaint yourself with the facts here before making your little digs. Early last year they were under pressure from the banks here to reduce the debt . Read the Regulatory News Statements .
Banks tend to get a little twitchy when they bankroll a company’s expansion plan when it fails to increase revenue or perhaps you know different?
Perhaps you have never run a business when you have borrowed a heap of dough to expand and things haven’,t worked out according to plan to know how banks operate?
Unfortunately ” managing the debt” isn’t enough unless accompanied by a definitive strategy going forward with milestone payments Until they appoint a new CEO with a strategy they are still in intensive care That’s s how these things work
Don’t take my word for it .They identified LSH as a subsidiary which might attract a significant offer.Unfortunately after testing the market this failed to materialise this died a death so in order to reduce the debt they placed shares at 175p with various institutions to raise funds which they did and reduced the debt but not significantly
I guess you would describe that as”calling in the debt”
Unfortunately this year revenue has decreased further which has only served to increase pressure .Platt of course being a major sacrifice
CWD will probably need to go out again for further equity to satisfy the banks.They have already hinted at that IMHO £50m might be enough to do that plus the appointment of a CEO which meets the bank approval to steady the ship .In turn this will reduce pressure so they can continue doing what they are meant to be good at without looking over their shoulders
The problem they have at what SP will the placing be at to succeed ? last year was 175p maybe 80p Depends how the market feels about the new appointment I really dont know but the likelihood is the small PI will continue to get shafted