Trading and Financing Update
06 Junio 2007 - 12:21PM
UK Regulatory
Hill Station plc (the "Company")
Trading and financing update
The Board of Hill Station announces that it is in discussions with its key
shareholders with a view to a fundraising to provide additional working capital
for the existing group and also to provide acquisition funding.
Since the fundraising in November 2006 and the appointment of new management at
the end of January 2007, a number of new factors have arisen requiring
additional working capital in the business. In the first quarter of 2007, raw
material prices increased significantly in particular milk products which are
clearly key components in ice cream manufacture. Furthermore, publicity
associated with funding problems in the second half of 2006 gave rise to
important customer losses and, in addition, low/negative margin sales have been
identified and eliminated and the number of product lines reduced, creating
additional working capital needs.
As well as increasing efficiency in the existing business, the Board's strategy
is to increase throughput and contribution to fixed costs at its Cwmbran
production facility. To this end a possible acquisition has been identified and
negotiations are in train with a view to the business being purchased. Funding
for this acquisition is also being discussed, but has not yet been agreed, with
the Company's key shareholders.
Pending the outcome of funding discussions and knowing whether the acquisition
will be completed or not the Company is managing its trade relationships
carefully. The Board is optimistic that discussions will lead to a successful
outcome.
Further announcements will be made as and when these matters are resolved.
Enquiries:
Hill Station plc
Bill Mapstone
Chairman
01633 833 000
END
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