RE: Andina plc25 Apr 2023 11:02
Notwithstanding the recent improvement in the local domestic market, recent reductions in liquid sales volumes during Q1 2023 and high levels of domestic inflation in Argentina have significantly weakened both group and, as a result of prohibitive foreign exchange costs, UK cash balances. As at 17 April 2023, the Company's UK cash balances are less than £0.1m albeit the Company expects a revenue receipt net to Echo of approximately ARS$ 135 million (c.£0.5m) in Argentina on or around the end of April.
Whilst the Company continues to explore means of monetising current liquid stocks and future liquid sales in Argentina, the Company has also received a proposal from a significant Argentine investor which has the potential to inject cash and an asset into the business. The Company is considering this proposal, albeit cautions that it is very early stage in its nature and until definitive documents are signed there can be no certainty of any proposal concluding.
In the meantime, and whilst the Company has received feedback that due to its large creditor position and Argentine macro-economic factors the raising of additional equity without a transformational transaction would likely be challenging, the Board continues to explore financing options to provide Echo with additional working capital resources to provide near term funding.