SigmaRoc (AIM: SRC ) said it intends to raise £12.4m at 51p in order to accelerate its near term acquisition and investment pipeline while it continues to demonstrate ‘resilient trading’.
The heavy construction materials group is planning to raise the funds through the issue of 24,312,737 new ordinary shares at a price of 51p, representing a discount of approximately 3.3 per cent. to the closing price of 52.75 pence per Ordinary Share on 8 December 2020.
Max Vermorken, CEO of SigmaRoc said the fundraising will provide the group with financial resources and “the ability to act quickly and decisively on a number of acquisition and capital deployment opportunities which have presented themselves over recent months.”
After establishing ‘a firm operational platform’ to manage risks posed by COVID-19, SimaRoc has developed a pipeline of bolt-on acquisitions as well as small expansion investments.
As outlined in a separate trading update released today, despite the challenging environment presented by COVID-19, SigmaRoc has continued to perform strongly, recovering swiftly to like-for-like growth from May, and remains on track to deliver record results for 2020.
For the 11 months ended November 2020, it reported a 78% year-on-year revenue increase to £114m which the group described as ‘significantly ahead of current market expectations.’
SigmaRoc said the combination of ‘improving demand and a highly effective operational response to the COVID-19 pandemic’ had resulted in an encouraging performance recovery across all of its businesses starting in May and continuing into the third quarter of 2020.
‘Whilst the further lockdown restrictions implemented in recent weeks, associated with the second wave of COVID-19, reinforce an element of uncertainty over outlook, they have not materially impacted either the Group's operations or short-term customer demand,’ it said.
Shares in SigmaRoc have increased by over 15% since the beginning of November 2020 to open 5.21% higher this morning at 55.5p following the announcement.
As a result, the company highlighted to investors that its Board currently expects to deliver results for the year ending 31 December 2020 ‘ahead of current market expectations.’
SigmaRoc intends to repay funding assistance received from the UK Government for the entities under its control during the first lockdown which amounted to aroundy £0.250m.
Looking ahead, the company said it remains optimistic that market conditions will normalise in 2021. In addition, it explained that it has been buoyed by the UK Government's commitment to infrastructure investment as part of its COVID-19 recovery strategy.
“The Group's performance for the eleven months to 30 November 2020 is very strong given the context and risks we faced. The Group has continued to demonstrate that a decentralised business model focussed on local markets is a robust approach in our industry, particularly in challenging times,” said Max Vermorken, CEO of SigmaRoc.
“The Group is supported by a solid asset base and will continue to confront all challenges head-on while executing on its buy-and-build strategy to deliver further shareholder value."
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