(Alliance News) - Papillon Holdings PLC on Wednesday said its loss widened somewhat in the first half of 2019 on finance costs as it worked to complete its Pace Cloud Ltd acquisition.
The firm's pretax loss for the six months ended June 30 was GBP198,000, widened from GBP161,000 the year before. While administrative expenses held steady at GBP154,000 versus GBP151,000 year-on-year, finance costs rose to GBP42,000 from nothing.
Papillon is an investment company and was created to make an acquisition. In May 2018, Papillon reached an agreement to make an investment in 50% of fintech firm Pace Cloud, which is focused on the used car market.
So far, Papillon has executed a share purchase agreement to acquire the 50% Pace Cloud interest. Given the in-progress acquisition, Papillon's shares are currently suspended having last traded at 1.325 pence.
In addition, Papillon has raised another GBP300,000 in the first half of the year, taking its issued convertible loan notes for the past 12 months to GBP500,000. These notes have a 10% interest coupon and conversion price of 1.25 pence per share.
The loan note proceeds are to be used to finance development of Pace Cloud's CarCloud app and business, as well as Papillon's expenses.
Chair James Longley said: "The directors continue to believe that the investment in Car Cloud has enormous potential in a very large market and that the proposed investment should add significant shareholder value and the directors continue to investigate routes to enhancing the offering, the valuation and the route to market of CarCloud which are progressing well.
"The investment proposes to break new ground in the market in which it operates, and the business model is a completely new solution in the way that individuals own and protect their vehicles, as described above it is a complete ownership solution from purchase and finance, through maintenance and on to the ultimate sale of a vehicle."
By Anna Farley; annafarley@alliancenews.com
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