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Ellies in talks with bank over debt obligations to pursue disposals

Ellies in talks with bank over debt obligations to pursue disposals

Photo by Bloomberg

6th October 2014

By: Natalie Greve

Creamer Media Contributing Editor Online

  

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Electronic products manufacturer Ellies has reached agreement with its bank to “reschedule certain obligations” in respect of its debt and facilities to pursue negotiations around the disposal of certain noncore assets and the implementation of an underwritten rights offer.

The company said in a brief note to the market on Monday that this may have a material effect on the price of the company’s securities.

Engineering News Online reported in August that a “perfect storm” of weak demand, a depressed consumer market, the cancellation of the residential mass roll-out programme and slower-than-expected OpenView high-definition sales had weighed on the financial performance of the JSE-listed group during the 12 months to April 30.

Ellies posted headline earnings a share of 23.46c for the financial year ended April 30 – a 68.3% fall on the 74c reported in the prior financial year.

The company's share price on the JSE fell 21.6% to R1.45 a share following Monday's announcement.

Edited by Chanel de Bruyn
Creamer Media Online Managing Editor

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