Eatonfield fights to stay afloat
AIM-listed Cheshire-based developer Eatonfield Group is trying to agree a way forward with its banks after breaching debt covenants.
In its unaudited interim results for the six months to the end of December, the company said a previously agreed overdraft had been withdrawn. The company can draw on £900,000 offered in return for equity by JV partner Jenard Properties and this would see Eatonfield through until the end nof August. As of Monday 29 March the drawdown cash had not been touched.
The financial statement said: "We continue to pursue options to raise further equity funding for the company in order to ensure that it has adequate working capital available to it for the foreseeable future. We believe that the provision of such funding will largely depend on the arrangement of a "standstill agreement" with all of our banks, pursuant to which each bank would agree not to make formal demand for repayment of their facilities during a specific period. A further announcement in relation to these matters will be made at the appropriate time."
Revenue for the six-month period was £2.71m (Dec 2008: £5.04m) and a trading loss of £2.96m (Dec 2008: £3.06m loss) was produced. Net debt stands at £25.3m, down from £30.3m a year earlier.
Eatonfield said it has agreed the conditions under Section 106 of the planning consent for its regeneration of the former Corus site in Workington. The agreement is awaiting approval from the banks. Eatonfield is working up a planning application for the Port Derwent site next door to the former Corus land.
In November 2009, Eatonfield raised £6.9m through a share placing.