LONDON (Alliance News) - Satellite data services provider Avanti Communications Group PLC on Thursday said revenue grew by around 35% in its recent financial year and said it is in talks to raise funds through an equity issue to meet working capital requirements.
Avanti said revenue for the year to the end of June will be around USD83.0 million, up 35% year-on-year. Earnings before interest, taxation, depreciation and amortisation will be around USD8.0 million, it said, down from USD16.0 million a year earlier.
Avanti said it has continued to win contracts, including around USD70.0 million worth in the fourth quarter, but said the economic backdrop in its end markets remains challenging. In Africa, currency depreciation has meant the company has been forced to help some smaller broadband service providers with exchange rate adjustments and changes to their current contracts.
Avanti added that larger telecoms and government customers have been demanding longer credit terms, impacting the company's working capital.
Avanti said the business is growing slower than had been anticipated, and the group is in final talks to secure an export credit facility to shore up its finances.
However, it said a pre-condition for this new debt facility, and in order to meet working capital requirements, it will have to raise at least USD50.0 million. It is holding talks with potential investors to raise the funds.
Avanti said that if it is unable to secure the funding or cut costs in the business, it may not have access to sufficient liquidity to meet its funding requirements through to the end of 2016.
Shares in Avanti were down 34% to 40.00 pence on the news.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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