Eddie Stobart Flags Higher Debt, Considers Raising Equity
Logistics firm Eddie Stobart Plc on Monday flagged higher debt and said it was considering the potential for raising new equity, while scrapping dividends for the year.
The news comes a month after the departure of chief executive officer Alex Laffey and the suspension of trading in its stock following the company's failure to publish its half-year results in time.
The company, whose largest shareholder is troubled fund manager Neil Woodford with a 22.9% stake, had warned on profit in July, citing a slowdown in some businesses and a forced exit from a "problematic" contract.
Eddie Stobart said on Monday it continues to expect the underlying earnings before interest and taxes (EBIT) for the year to be "significantly below" its expectations.
The company was reviewing its previous statements under new chief financial officer Anoop Kangits when it found that 2018 adjusted operating profit was overstated by about £2 million.
"The management team is focused on continuing to deliver excellent customer service and commitment, whilst simultaneously prioritising cash generation within the business. Actions to strengthen internal processes are underway and steps to improve cash collection have been taken."
Eddie Stobart Logistics said earlier this month that it had received a preliminary expression of interest from its third largest shareholder, DBAY Advisors Limited.