Education and resourcing company, ADvTECH Limited, has announced that the
individual companies within the Group are trading well.
Discussions with a potential purchaser of the Group were terminated in May
and the cautionary notice has subsequently been withdrawn. The ADvTECH
Board has decided that the business is no longer for sale.
Group Chairman, Brian Buckham, assumed an interim operational role within
ADvTECH following the resignation of Group MD Renney Plit in May. Buckham is
pleased to announce that Rob Childs will be taking up the appointment of CEO
of ADvTECH Limited with effect from 9 July 2001. Childs has been appointed
to the board of ADvTECH with effect from 29 June 2001. In addition, Hugh
Brown, Motty Sacks and Lenn Honey have also been appointed to the board of
directors with effect from 29 June 2001. Hugh Brown will continue in his
position as a consultant to the company.
Comments Group Chairman Brian Buckham:
"We are directing all our efforts at making sure the individual business
units are trading profitably and meeting their budgets. Prospects for the
Group are encouraging. "
ADvTECH has been through a difficult period during the past 18 months. The
consolidation of the Group into one listed entity last year and the
elimination of the pyramid structure resulted in there being no controlling
shareholder. This, together with a relatively low share price because of a
re-rating of the Education and Recruitment sector by investors, attracted
bids for the company.
Buckham says the company is relatively highly geared as a result of the
decision to settle acquisition vendors in cash rather than shares because of
the low share price. This situation will improve significantly during 2002
and should reduce to a negligible level during the following year.
"The focus is now on digesting the acquisitions we have made over the past
few years and to reduce our gearing over the next twelve months. There are
obligations to vendors of approximately R24 million to be settled this year.
However, EBITDA is budgeted at approximately R85 million. In addition,
management will focus on optimising cash flows and generating organic growth
within the business units."
Buckham says the company is currently taking legal action against certain
vendors in respect of the earn outs and warranties they provided at the time
of purchase. The result of this legal action is likely to be a reduction in
the net cost of these purchases and borrowings to the company.
ENDS
ENQUIRIES:
AdvTech Limited
Brian Buckham, AdvTech Chairman Tel: 011 886 5100
TriLogy Communications
Graham Fiford
Tel: 011 325 0533
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