REG - Dillistone Group PLC - Trading update and Fund Raising

DillistoneAnnouncement

23/08/2024 07:00

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RNS Number : 4880B  Dillistone Group PLC  23 August 2024

23 August 2024

Dillistone Group Plc

("Dillistone", the "Company" or the "Group")

Trading update and Fund Raising

 

Dillistone Group PLC, the AIM quoted supplier of software for the
international recruitment industry, provides a trading update and is pleased
to announce that it has agreed to raise GBP300,000 through the issue of
convertible loan notes ("Loan Notes") and £60,000 through the issue of new
ordinary shares (the "New Ordinary Shares") (together the "Fund Raising").

 

The Group announced, on 12 June 2024, that its market remained challenging
and, if anything, had softened further in the second quarter. This softness
has continued into the third quarter.

 

Today, however, the Group is pleased to confirm that the results for the six
months ended 30 June 2024 are likely to be in line with management
expectations, which would equate to a significant improvement in operational
profitability, compared to the first half in the previous year. The business
was again operationally cash generative in the period.

 

The Board considers the Fund Raising to be a prudent course of action in case
the Group's markets continue to be challenging for an extended period. The
proceeds from the issue of the Loan Notes and the New Ordinary Shares will
therefore be used to provide the Group with additional working capital.

 

The Loan Notes, which will be drawn down fully in one tranche when required by
the Company, will be provided by Mike Love, the former Chairman of Dillistone,
and each of the current Directors (together "Noteholders") of the Company as
follows:

 

 Giles Fearnley   £60,000
 Jason Starr      £90,000
 Ian Mackin       £30,000
 Steven Hammond   £15,000
 Paul Mather      £15,000
 Simon Warburton  £15,000
 Julie Pomeroy    £5,000
 Mike Love        £70,000

 

The Loan Notes carry an interest coupon of 9.85 per cent pa over their maximum
term of 48 months, with a conversion price of 14.0 pence per new Dillistone
ordinary share, representing a premium over the current price of 55.6%.
Interest will be payable quarterly in arrears and will be satisfied in cash.
Various rights are built into the agreement for early repayment or conversion.

 

The issue of the Loan Notes to the Directors constitutes a related party
transaction under AIM Rule 13. As each of the Directors is participating in
the Loan Notes and therefore there is no independent Director for this
purpose, Zeus Capital Limited, the Company's nominated advisor, considers that
the terms of the Loan Notes are fair and reasonable in so far as Dillistone
shareholders are concerned.

 

The 750,000 New Ordinary Shares are being subscribed at 8 pence each by a new
independent shareholder. The New Ordinary Shares will, when issued, be
credited as fully paid and will rank pari passu in all respects with existing
ordinary shares, including the right to receive all dividends and other
distributions declared, made or paid after their date of issue. It is expected
that admission of these shares to trading on AIM will take place on 29 August
2024.

 

Following Admission, the total number of Ordinary Shares in the capital of the
Company in issue will be 20,418,021 with voting rights. This figure may be
used by shareholders as the denominator for the calculations by which they
will determine if they are required to notify their interest in, or a change
to their interest in, the Company's share capital pursuant to the Financial
Conduct Authority's Disclosure Guidance and Transparency Rules.

 

 

 

Giles Fearnley, Chairman of Dillistone Group Plc, commented: "In a challenging
climate, we are pleased that we expect to report positive results in H1. This
additional cash injection, supported by every current Board member along with
our former Chairman, Dr Mike Love, and a new, independent shareholder shows
our confidence in the business. It provides working capital to support trading
and will also facilitate the release of significant product updates that we
expect to see later in the year.

 

"As and when the recruitment industry recovers, the Group will be well
positioned to take advantage."

 

 

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR").  Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.

 

The person responsible for arranging the release of this announcement on
behalf of the Company is Ian Mackin, Finance Director of the Company.

 

 

Enquiries:

 Dillistone Group Plc
 Giles Fearnley                     Chairman                      Via Walbrook PR
 Jason Starr                        Chief Executive Officer
 Ian Mackin                         Finance Director

 Zeus Capital Limited (Nominated adviser)
 Chris Fielding                     Director, Investment Banking            020 3829 5000

 Walbrook PR
 Tom Cooper / Joe Walker            Dillistone@walbrookpr.com
                                    020 7933 8780
                                    0797 122 1972

Notes to Editors:

Dillistone Group Plc is a leader in the supply and support of software and
services to the recruitment industry. Dillistone operates through the Ikiru
People (www.IkiruPeople.com (https://www.ikirupeople.com/) ) brand.

 

The Group develops, markets and supports the Talentis, FileFinder, Infinity,
Mid-Office, ISV and GatedTalent products.

 

Dillistone was admitted to AIM, a market operated by the London Stock Exchange
plc, in June 2006.

 

Learn about our products:

Talentis Software:
https://www.talentis.global/recruitment-software/
(https://www.talentis.global/recruitment-software/)

Voyager Software:
https://www.voyagersoftware.com (https://www.voyagersoftware.com)

GatedTalent Services:
https://www.talentis.global/optimization-services/
(https://www.talentis.global/optimization-services/)

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