Superficially, there is an impressive gap between the company’s market capitalisation, £12.5m, and property assets of £54.7m. But before getting carried away we need to consider whether the company is vulnerable to failure because of its debt levels and covenants on those loans.
Net bank borrowings fell between 31st March 2020 and 31st March 2021 from £16.1m to £10.3m, so that is encouraging. The makeup is £5.7m of cash and £16m of borrowing.
Debt facilities have been agreed with HSBC and VW Bank:
Debt outstanding at March yearends 2021 - 2018
£m 2021 2020 2019 2018
Current 3.9 8.9 4.9 1.4
Non-current 12.2 8.7 12.6 13.1
Total debt 16.1 17.6 17.5 14.5
Less cash -5.7 -1.5 -3.9 -2.2
Net debt 10.3 16.1 13.6 12.3Preliminary results to 31st March 2021: “This substantial reduction [in bank debt over the year] reflected the strengthened controls over working capital and cost savings implemented during the year, as well as the significant covid-19 support received by the Company from the Coronavirus Job Retention Scheme and the business rates holiday.”
The VW term loan and the HSBC debt, are subject to covenants tested with respect to:
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