TIDMGRA
RNS Number : 4506B
Grafenia plc
06 October 2015
Grafenia plc
("Grafenia" or "the Company" or the "Group")
Sale of Subsidiary, Board Changes and Trading Update
Grafenia plc (AIM: GRA), announces today the sale of its Dutch
subsidiary and a number of Board changes.
Sale of Dutch Subsidiary
Grafenia plc has completed the sale of its Dutch subsidiary,
Grafenia BV, to Rosso BV, a privately owned Dutch company, for a
cash consideration of EUR2,350,000.
Grafenia BV, previously named Media Facility Group BV, was
acquired in 2010, for a consideration of EUR2,000,000, paid part in
cash and in part by the issue of ordinary shares in the Company.
Taking into account cash generated from operations since the
acquisition, this venture has provided a satisfactory return on
that investment. The Board has taken the decision to sell Grafenia
BV because the strengthening of sterling against the Euro has made
the ongoing supply of print to the Eurozone less attractive.
Grafenia BV operates the online channels Flyerzone.nl, Drukland.nl
and Drukland.be. The online channels Flyerzone UK, Ireland and
France do not form part of the sale and are retained by the
Group.
The Group will now focus on the development of its new and
existing channels in the UK and Ireland. The sale proceeds will be
applied to supporting the Group's partner networks, its online
trade site Marqetspace, other online channels and its cross media
offerings Brambl and Nettl.
In the year ended 31 March 2015, Grafenia BV generated revenues
of approximately GBP6m and an operating profit of GBP0.4m. On 31
March 2015, Grafenia BV had gross assets of GBP0.4m.
Board Changes
Following the disposal of Grafenia BV, in the short term, the
scale of the Group's operations will materially reduce.
Accordingly, and by mutual agreement, Tony Rafferty has decided to
step down as Chief Executive and to leave the Company. He will be
available to assist the Group during the transition period and
intends to retain his equity stake for the foreseeable future. The
Board wishes to thank Tony for his years of unstinting service and
drive making the Group what it is today.
The Board is pleased to announce that it has appointed Peter
Gunning as acting CEO. Peter has been the Group's CTO for the past
5 years and, prior to that, the Group's Operations Director with
responsibility for Operations, Marketing and systems
development.
The Board is also pleased to announce the appointment of Conrad
Christian Bona as a Non-Executive Director. Conrad (aged 46) is an
experienced entrepreneur, investor and business consultant who has
been involved with numerous complex commercial and financial
transactions across a wide range of sectors.
Conrad has extensive experience as a banking and finance lawyer,
having qualified as a barrister and solicitor in Ontario, Canada,
an attorney-at-law in New York, US, and as a solicitor in the
UK.
He is currently a director of Grayshott Limited, a London based
business consultancy and project management firm.
Conrad Bona's other directorships in the last five years (all of
which are current) are:
Giantslayer Limited - appointed 17 July 2013
Cornerstone Global Investors Corporation - appointed 15 May
2015
Invictus Investment Limited - appointed 8 November 2010
There are no further disclosures to be made in respect of Conrad
Bona in accordance with AIM rule 17 and Schedule 2 paragraph (g) of
the AIM rules.
Les Wheatley, Chairman of Grafenia commented, "The Board
believes the disposal of our Dutch business will help in the
refocusing of the Group moving forward. Tony's decision to step
down is consistent with the Group's reduced size and Peter's
appointment will ensure a seamless transition providing reassurance
to our many partners in the UK and internationally of our ongoing
commitment. The appointment of Conrad strengthens the Board and
will provide a fresh perspective."
Trading Update
Trading softened during July and August, although September was
in line with internal budgets. As previously stated, the Board
anticipates the current year's results will be second half
weighted. Taking into account the relative weakness of the Euro,
first half underlying earnings will be modest. Trading in the
second half of the year for the Group's continuing operations is
anticipated to be in line with the Board's expectations. However,
the weakness in the first half is likely to result in underlying
earnings for the full year being materially lower than previously
expected on a like-for-like basis.
Marqetspace, the Group's online site for professional buyers,
continues to progress with September comfortably exceeding the
targeted GBP2m annualised monthly run rate.
Nettl recorded an additional 10 partners during the first six
months, taking the total to 36 Studios including those
Company-owned. This is lower than expected as the deal cycle is
proving longer than anticipated. Encouragingly, 43 licenses have
been granted for Brambl, the Group's subscription service for
graphic professionals - launched on 1 September 2015 - which
provides access to our website design tool in return for monthly
fees and hosting charges.
The Interim Results for the six month period ended 30 September
2015 are expected to be announced on Monday 9 November 2015.
For further information:
Grafenia plc
Les Wheatley (Chairman) 07815 563 139
Peter Gunning (Chief Executive) 07973 191 632
Alan Roberts (Finance Director) 0161 848 5713
N+1 Singer (Nominated Adviser)
Richard Lindley/James White 0207 496 3000
This information is provided by RNS
The company news service from the London Stock Exchange
END
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October 06, 2015 12:32 ET (16:32 GMT)
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