Havelock Europa secures additional funding to boost revival plan

Shaun Ormrod

Interior solutions provider Havelock Europa has secured a multi-million financing deal as the firm continues to implement its turnaround strategy.

The Kirkcaldy-based firm has reached agreement in principle on a package of funding which includes an extension of existing senior debt facilities of £5 million for a two year term.

Additional subordinated debt financing of £3m is in place for six years.

The deficit reduction contributions payable to the company’s pension scheme have also been revised.

The company said: “The effect of the changes, whilst in aggregate negatively impacting Havelock’s profit and loss account by approximately £0.5m per annum for the next two years, will be to provide sufficient funding to support the delivery of the new strategic and short term operational plan.”

The funding is the latest step in the turnaround strategy implemented by chief executive Shaun Ormrod, who joined the group in September following the resignation of David Ritchie.

The company recorded a pre-tax loss of £2.6m for the first six months of last year and yesterday’s trading update revealed the firm expected to continue to be loss making in the second half of the year.

However, it said the second half of 2017 was a “substantial improvement” over the first six months.

Chief executive Shaun Ormrod said: “2017 was a difficult year for Havelock but we have begun 2018 with the business fully aligned behind the new plan we set out on 31 October 2017. With a renewed commercial focus and with the backing of our funders, I am confident that the business can return to a position of market leadership in the medium term.”

Preliminary results for the financial year ended 31 December 2017 are scheduled to be announced by mid-April 2018.

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