Woodbois Regulatory News (WBI)

19 April 2023

Woodbois Limited

("Woodbois", "the Company") 

Facility with Sydbank A/S ("Sydbank")

Woodbois, the Africa-focused forestry, timber trading and afforestation company, announces that Woodgroup Aps, a wholly owned subsidiary of the Company, has received a notice from Sydbank, a lender to Woodgroup Aps, that it is terminating a $6 million debt facility that it holds with Woodgroup ApS (the "Facility").

Woodgroup ApS has various banking arrangements with Sydbank, including the $6m Facility that was fully utilised and an ancillary account with a cash balance of $3.1 million. Sydbank have a floating charge against the assets of Woodgroup ApS and have offset this $3.1 million in partial repayment of the Facility.

The reason cited by Sydbank for terminating the Facility was that Woodgroup ApS generated a loss in Q1 2023. Sydbank believe that, as a consequence, the circumstances of Woodgroup ApS have changed significantly to their detriment.

As part of the notice Sydbank also requested that the Woodgroup ApS present a plan for the repayment of the outstanding $2.9 million of the Facility. Sydbank has verbally indicated that they would be open to working with the Company to at least the end of May to allow the development of a plan to refinance the balance.

The Company was shocked to receive this unexpected notice of termination and has reserved its rights on the basis of the termination and the validity of the termination notice.

Management do not agree with Sydbank's conclusion and, whilst acknowledging the poor performance in Q1, believed the Company had been well placed to deliver a very positive performance for the remainder of the year.

The Company is reviewing its internal cash-flow forecasts following this unexpected termination and, whilst it expects a difficult trading period in the short term, management believe that the fundamentals of the business are sound and it will continue to work actively to find alternative funding sources in order to continue to grow the business.

The Company has cash balances outside the Sydbank account of $430,000 and net trade receivables of $1.5m. Management believe that the Company can continue to operate as a going concern in the short term, and will seek to utilise existing cash reserves and available working capital to meet its near term operating obligations. The Company is working with restructuring professionals and is taking all necessary steps to preserve the business, whilst undertaking a concerted contingency planning exercise. The board continues to work with all other creditors and stakeholders to achieve this.

The Company will make further announcements as necessary.

Enquiries

Market Abuse Regulation

The information contained within this announcement would have, prior to its release, constituted inside information as stipulated under Article 7 of the Market Abuse Regulation (EU) No.596/2014 as incorporated into UK domestic law by virtue of the European Union (Withdrawal) Act 2018 as amended by virtue of the Market Abuse (Amendment) (EU Exit) Regulations 2019 ("UK MAR"). Upon the publication of this announcement via a regulatory information service, this inside information will be considered to be in the public domain. For the purposes of UK MAR, the person responsible for arranging for the release of this information on behalf of the Company is Carnel Geddes.