Real Good Food has raised £1m with an open share offer that it says had been heavily oversubscribed.
The business announced last month that it was seeking to raise extra working capital with the offer.
The move follows a troubled period for the Haydens and Renshaw owner, which earlier this year admitted there had been a “significant risk” it would not be able to trade without additional funding from its major shareholders. The business has also warned it expects to make a £3.5m earnings loss this year (see timeline below).
Under the open share offer, the business issued 20,115,190 ordinary shares of £0.02 each and received applications for 29,984,154 shares – an excess of 49% of the total available.
RGF said qualifying shareholders who have applied for shares will receive their application in full and those shareholders who have applied for excess shares will receive around 61% of their application on a pro rata basis.
Real Good Food timeline
1 August 2017
- RGF announces earnings for 2017 will be £2m, around £3m lower than previously forecast, and that profits in 2018 will be lower than expected.
- RGF also reveals that payments for consultancy services made to executive chairman Pieter Totté and non-executive director Peter Salter have not been disclosed in transaction notes for accounts in 2014 to 2016, but have been accounted for.
- Salter, chairman of RGF audit and remuneration committees, resigns.
- Founder and executive chairman Pieter Totté resigns and steps down from the board with immediate effect.
- Non-exec director Pat Ridgwell becomes interim chairman, while non-exec director Christopher Thomas becomes executive director.
- Finance director David Newman is replaced by Harveen Rai, but remains with the company for a changeover period.
- New non-executive director Hugh Cawley joins the board to head RGF’s audit committee, while non-exec director Judith Mackenzie becomes head of the remuneration committee.
- RGF secures a £2m overdraft facility with Lloyds Bank after a re-forecasting exercise finds a “short-term working capital requirement” as the business builds up stock ahead of Christmas and proceeds with previously announced investment programmes at Renshaw and Haydens.
- RGF further reduces profit expectations for 2017 to £1m.
- RGF says it is committed to improving its corporate governance and reporting, admitting standards have been below those investors “might reasonably expect”, adding it is “committed to rectifying this important aspect of operations and disclosure”.
- Shareholders agree to give the business a £4m short-term debt facility.
- RGF reports a £5.8m loss in the 12 months ending 31 March 2017, despite a £7.8m year-on-year increase in group sales to £108.2m. The loss is attributed to factors including “the effect of currency exchange on key commodity prices and poor financial control of central costs”.
- RGF announces revenue up 30% year on year to £63.6m in the six months ending 30 September 2017, although it made a £6.7m pre-tax loss compared with a £0.9m loss in the same period the previous year.
- Shareholders agree to provide an initial £3m of additional funds, while longer-term funding arrangements are put in place.
- RGF warns it is set to make £3.5m earnings loss following poor trading at end of 2017
- Major shareholders agree to provide up to an additional £4m funding.
- Kent Foods Limited buys Garrett Ingredients business from RGF.
- RGF announces further £8.2m financing from major shareholders Napier Brown Ingredients, Omnicane International Investors, and funds managed by Downing LLP, stating that, without this, there was a “significant risk” it would not be able to trade.
- RGF announces plan to raise £1m in working capital through open share offer.