12 May 2011 12:02
Mountfield Group PLC (the "Company" or the "Group")
Placing to raise £560,000 to provide the Group with additional working capital to fund significant contract wins in the data centre construction sector
Mountfield Group (LSE MOGP) , the AIM-quoted company specialising in the construction of data centres is pleased to announce that the Company has placed 37,333,334 new ordinary shares of 0.1 pence each ("Shares"), representing approximately 17.56% of the Company's enlarged issued share capital (the "Placing").
The new Shares have been placed with institutional and retail investors at a price of 1.5 pence per share, for gross proceeds of £560,000. The Placing is subject to admission of the new Shares to trading on AIM becoming effective which is expected to occur on the 17th May 2011. The proceeds of the Placing will be used to fund working capital required for the delivery of new contract wins in the rapidly growing data centre construction space.
In that context the Company is also pleased to announce that it has been awarded three contracts with an aggregate value of £5 million to fit out data centres in the UK for leading data centre operators. All three contracts are expected to be delivered during 2011, one of which may lead to further orders over the coming year as further phases of the project are built out.
The secured order book for the four months to the end of April 2011 exceeds the total revenue achieved for 2010. Management currently believe that existing sales delivered hitherto combined with clear visibility of the robust Group order book indicate that revenues for the Group in the current year are likely to be significantly ahead of the financial year 2010.
After 2 years of limited activity the demand for data centre builds has returned during the last quarter in a very significant way and current market indications are that this activity in the sector looks set to continue for the foreseeable future, and therefore the Group looks forward to further gains for its core business activity.
The IT sector is a significant consumer of energy and the Company, along with its working partners, is dedicated to construct more energy efficient premises and these projects will incorporate designs to maximise efficiency and reduce carbon footprint.
Following a review of the Group's expanding order book, it has been agreed with note holders that redemption of the Company's existing £4.4m Loan Notes will be deferred from June 2011 to June 2016. This, along with the Placing announced today, will provide the financial stability required to ensure that the Group has access to the working capital that it requires to finance the increased level of orders that it has received this financial year.
The Company is also pleased to announce the appointment of First Columbus LLP as their broker with immediate effect.
Commenting on the announcement, Peter Jay Chairman of the Mountfield Group PLC said:
"We have noted a distinct upturn in this specialist sector of our industry over the last two quarters which, having improved our position in 2010, looks to have a significant positive impact on our figures for 2011. It is a testament to the high regard that the Mountfield Group has with data centre installations that we have been chosen to undertake these projects for some of the UK's leading operators of data centres
For further information please contact:
Mountfield Group Plc +44 (0)20 7398 7718
Graham Read
Chief Executive Officer
Arbuthnot Securities Limited +44 (0)20 7012 2000
Tom Griffiths
First Columbus LLP +44 (0)20 3002 2071
John Nuttall
De Facto Financial +44 (0)20 7556 1063
Mike Wort, Anna Dunphy
Notes to Editors:
Mountfield Building Group Limited: The company carries out works as a main contractor with end-user clients. Since the 1990's Mountfield has specialised in the installation of data centres and has successfully completed more than 40 data centres throughout the last 12years,
MBG Construction Limited: Carries out specialist builderswork and multi trade packages for leading fit-out and refurbishment main contractors. Deploying its own directly employed skilled labour Mountfield delivers a comprehensive range of services together with specialist partnering subcontractors. In addition to data centre trade packages, Mountfield carried out builderswork packages that include stripping out, blockwork, plastering, riser/lift formations, ceilings, partitions and general builderswork in connection with the supply of mechanical and electrical services.
Connaught Access Flooring Limited: The company was formed in 1992 as a provider of flooring systems to main contractors and corporate end users. The business has grown substantially since it was acquired by Graham Read and Andrew Collins in 2004. It has supplied and installed flooring in excess of 5million square feet to both office and data centre installations since that time.
Mountfield Land Limited: This company (which was incorporated in 2008) sources and enhances the value of land before selling its interest to developers. It is currently sourcing land options for potential data centre sites that would complement the groups other subsidiary companies. It is not exposed to any financial risk or liability from its dealings or transactions as it does not purchase any sites.