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WYG targets £30m refinancing deal

WYG is attempting to secure a £30 million refinancing deal it says will enable growth following a turbulent two-and-a-half years.

In its results for the nine months to 31 March – after altering its end-of-year date from June – the consultancy reported a pre-tax loss of £28.6m, up from £21.9m in the 12 months before.

The firm - which has been undertaking a large-scale restructure since 2009, including cutting 50 per cent of its workforce - reported that net debt at 31 March 2011 had reduced to £29.2m from £33.9m.

The costs of the current £58m debt facility, due to expire in December 2012, were described as “unsustainable”. 

WYG said its immediate priority was to complete a successful capital restructuring to enable it to pursue overseas opportunities.

David Wilton, group finance director, told CN: “We see it as a very positive day for the company.

“If you look at the two-and-a-half year journey we have been on, when we started we inherited a company that was broken. We had £100m of debt at the time.

“The last refinancing we did was a refinancing for survival – this one is a refinancing for growth.”

But the company’s share price was down 20 per cent by close yesterday.

UK and Ireland orders are down from £114m to £73.6m, but international orders were up to £104m from £100.6m.

At the end of March 2011, the firm employed 1,587 permanent employees compared to 2,148 at 30 June 2010, with the majority of the reduction from engineering and management services.

The firm said it was “heartened” by potential opportunities within framework agreements in the public sector relating to defence, justice and nuclear. It said it has submitted the UK’s largest planning application for a £5.5bn redevelopment of Liverpool docklands and completed Europe’s largest water enhancement project in Poland.

But WYG said there was limited visibility of future work in both the public and private sectors in the UK, and despite ongoing retail expansion and the drive for green and renewable energy generation, the scale and timing of any sustained recovery in the UK remained very difficult to predict.

Chief executive Paul Hamer added: “The operational restructuring of the business is now substantially complete and WYG is much better placed to exploit the opportunities available to us in our chosen international markets.”

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