9 Nov 2016 09:15
9 November 2016
Management Resource Solutions Plc
Update on Trading and Suspension
Further to the announcements of 27 October, 28 October and 3 November, the directors of Management Resource Solutions Plc ("MRS", "Company" or "Group") are pleased to provide an update on their review of the Group's business and the current suspension of the Company's shares from trading on AIM.
Consulting Business
It has become apparent that there were significant shortcomings in the Group's contracts with PEAL in Papua New Guinea and with Aiotec in New South Wales. Having taken legal advice, the Company is moving to commence proceedings to recover amounts due to it under both contracts but in the interim the board has determined that these contracts will be terminated immediately, thus eliminating a significant ongoing cash drain on the Group.
As these contracts represent the entirety of the remaining consulting business of MRS, their termination effectively marks the closure of the consulting business and the Group has already realised annualised cost savings of approximately $1.5m as a result of discontinuing these services.
The amounts due to MRS from PEAL and Aiotec are to be determined and subject to potential counter claim but are likely to be in the order of several million dollars before costs. Further information regarding recovery of these sums will be provided as appropriate.
Suspension from trading on AIM
The directors of MRS continue to work with their advisers and bankers to progress the Group audited accounts and to identify and rectify areas of concern within the Group. Only once the directors are satisfied that they have fully identified the issues within the Group and notified shareholders of such, application will be made for the Company's ordinary shares of €0.01 each to be restored to trading on AIM and efforts are being made to do this as soon as possible. However, the directors are able to confirm that the businesses of SubZero and Bachmann are thriving and any issues impacting the Group are contained within the now defunct consulting business.
Further announcements will be made once additional information is available.
For further information:
Management Resource Solutions PLC c/o FTI +44 (0)20 3727 1000
Murray d'Almeida, Chairman
Timothy Jones, Finance Director
Northland Capital Partners Limited +44 (0)203 861 6625
(Nominated Adviser and Joint Broker)
William Vandyk
Gerry Beaney
Peterhouse Corporate Finance Limited +44 (0)20 7469 0932
(Joint Broker)
Charles Goodfellow
Lucy Williams
FTI Consulting +44 (0)20 3727 1000
Edward Westropp
Emilie O'Herne
Management Resource Solutions (MRS), through its subsidiaries Bachmann and SubZero, offers plant hire, equipment repair, refurbishment and fabrication, mine rehabilitation, earthmoving, road construction and other support services to a wide base of private and public sector clients in Australia. MRS caters predominately to the oil & gas, mining, civil engineering, construction and infrastructure industries.