Conviviality shares hit as it issues update on profit warning

Cornelia Mascio
Marzo 15, 2018

One of the largest wine distributors in the UK, Conviviality, has been forced to suspend trading on the London stock exchange after discovering an unexpected £30 million tax bill less than a week after it cut profits forecasts.

In a statement issued today (14 March), Conviviality said it had "identified a payment due to HMRC of approximately £30 million which falls due for payment on 29 March 2018".

The bill to the HM Revenue & Customs has "created a short-term funding requirement", Conviviality explained.

It comes after the Aim-listed firm said on Tuesday that it expected adjusted earnings to come in 20% below market expectations, between £55.3 million and £56.4 million.

Two thirds of the company's market value was wiped off last week following the trading update.

The company emphasised it was "currently in compliance" with its banking covenants.

Often shares are suspended at the request of the company itself and are usually a sign of an important impending announcement.

Conviviality continues to expect net debt to be approximately GBP150.0 million for the year ended April 29.

It added: "The Company has engaged PwC to assist it in its forthcoming discussions with HM Revenue & Customs and its key stakeholders including its lending banks, credit insurers, suppliers and other creditors, as well as to determine the potential impact of any resulting funding requirement on the Company's adjusted EBITDA expectation and compliance with its banking covenants". "Whilst there can be no guarantee", the company concluded, "the board believes this short-term funding requirement will be satisfactorily resolved".

Altre relazioniGrafFiotech

Discuti questo articolo

Segui i nostri GIORNALE