LONDON (Alliance News) - Strat Aero PLC on Thursday said it has secured a short-term financing loan to provide it with working capital, as it undertakes a review of its activities and cost base, particularly in the US.
The drone company said the GBP300,000 six-month loan facility with Farina Investments UK Ltd will provide it with adequate working capital through to the middle of the first quarter of 2017. The loan has an interest rate of 25% over the six month term.
Shares in Strat Aero were up 26% at 0.440 pence Thursday morning, amongst the best performers on AIM.
Strat Aero said it is undertaking a thorough review of all of its activities in the US, with the objective of scaling its costs back to a level that can deliver on its existing contracts, as well as giving it headroom to pursue customer acquisition activities and maintain its data analytics capability.
Meanwhile the company said its two core divisions, Survey & Inspection Services and Commercial UAS Training & Education, continue to perform in line with its expectations. Additionally, its Geocurve business has been trading profitably since it began its multi-year environment agency contract in September.
"In tandem with our focus on revenue generation, we are closely reviewing our cost base, particularly in the US, so that we retain as much cash flow as possible for reinvestment into growing the business. Today's loan will assist with our working capital requirements during this period of transition, as we work towards establishing Strat Aero as a leading provider of UAV based services and solutions," said Chief Executive Office Iain McLure in a statement.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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