Postie Plus shares placed in trading halt pending material announcement

Richard Binns, Postie Plus Chief Executive
Postie Plus 12-month price history (NZX.com)

Postie Plus [NZX: PPG], the worst performing stock on the New Zealand sharemarket the past year, had its shares placed on a trading halt pending a material announcement by the company.

The Auckland-based retailer has previously said it expects to have a “significant” net loss before tax in the year ending Aug. 3, though smaller than last year’s loss of $10.6 million. Postie Plus has struggled to deal with the poorly executed outsourcing of a purpose-built distribution centre in Mangere when it relocated to Auckland in 2012, where it saw greater opportunities. The disruption to its supply chain put the operation under pressure, leaving it with too much debt and limited cash flow.

Last month, Postie Plus said it was in breach of its lending covenants and expected to remain so “for the foreseeable future,” meaning its bank funding is repayable on demand. The funding remains available and the company was in regular contact with its bank, it said. The board was satisfied that the arrangements it had in place with its bank were sufficient to meet the company’s forecast funding requirements up to July 30, it said last month. The company is working on recapitalising its business ahead of a forecast funding requirement peak of about $19 million between July 30 and Feb. 2 next year.

Postie Plus said last month it expects to be able to negotiate new bank facilities for the period beyond July 30 “if the company is able to meet its trading forecasts and secure additional funding to reduce its reliance on bank funding".

The company's shares have plunged 59 percent over the past 12 months, making the stock the worst performer on the NZX All Ordinaries Index. They last traded at 7.3 cents, valuing the company at $2.9 million.

(BusinessDesk)

This article is tagged with the following keywords. Find out more about My Tags

NZ Market Snapshot

Forex

Sym Price Change
USD 0.7452 -0.0011 -0.15%
AUD 0.9419 0.0011 0.12%
EUR 0.6642 -0.0005 -0.08%
GBP 0.4962 -0.0001 -0.02%
HKD 5.7807 0.0008 0.01%
JPY 87.7610 -0.0020 -0.00%

Commods

Commodity Price Change Time
Gold Index 1292.6 -7.090 2015-01-23T00:
Oil Brent 49.9 0.320 2015-01-23T00:
Oil Nymex 45.6 -0.820 2015-01-23T00:
Silver Index 18.3 -0.060 2015-01-23T00:

Indices

Symbol Open High Last %
NZX 50 5647.1 5713.3 5711.9 -0.64%
NASDAQ 4748.2 4771.2 4750.4 0.16%
DAX 10503.3 10704.3 10435.6 2.05%
DJI 17812.5 17812.5 17814.0 -0.79%
FTSE 6796.6 6841.7 6796.6 0.53%
HKSE 24807.4 24896.2 24522.6 1.34%
NI225 17520.6 17532.1 17329.0 1.05%