amaysim Australia Shares Tumbled On The Launch Of $15.5 Million Retail Offer

Today, amaysim shares crashed 8.571% after the company initiated the retail component of the entitlement offer to raise up to $15.5 million. This translates the dispatch of retail entitlement offer booklet and personalized entitlement and acceptance form to the company’s retail shareholders eligible to participate in the 1 for 2.5 accelerated non-renounceable entitlement offer announced shortly.

The telecommunication player, amaysim Australia Limited (ASX AYS), has already completed the institutional component of the offer, raising approximately $35.1 million via the issue of ~58.5 million new shares at $0.60 per share. The company witnessed substantial support from its current institutional shareholders who took up around 97% of their entitlements. 

amaysim Chief Executive Officer and Managing Director, Peter O’Connell, said: “This is a terrific result for the Company, and is a very strong display of support from amaysim institutional shareholders. The company now welcome its retail shareholders to participate in what it views as a fantastic opportunity.”

The announcement read that retail shareholders present on the record date of 28 February 2019 can apply for shares at the offer price of $0.60 per share. amaysim Australia intends to issue approximately 25.8 million shares to raise up to $15.5 million in retail entitlement offer.

Amaysim intends to utilise the total net proceeds from both institutional and retail entitlement offer, i.e., approximately $50.6 million, towards the reduction of debt. Its core focus is to strengthen the balance sheet and enhance its flexibility to support investment in new strategic growth initiatives, including a significant increase in mobile marketing spend to boost brand awareness and accelerate mobile subscriber growth.

For the half year ended 31 December 2018, amaysim reported continued growth in its energy business despite the highly competitive market with underlying EBITDA up 69.2% to $18.7 million, on net revenue of $155.1 million. Disciplined margin management over the period resulted in energy gross profit increasing 25.8% to $43.3 million and gross margin increasing by 543 basis points to 27.9%.

Given the strong performance of the energy business, amaysim has accelerated its investment in a new disruptive energy product suite, which is expected to assist in bringing much-needed simplicity, customer centricity and transparency to the sector. Going forward, the company targets to complete the development and launch of a new disruptive energy product suite that is customer-centric, transparent, simple and fair.

With respect to Full Fiscal Year 2019, the company presented its outlook for Underlying EBITDA that is expected to be within the range of $44.0-$48.0 million following the implementation of new Accounting Standard changes.

As per the timetable of retail entitlement offer, the offer will close on 25 March 2019, and the shares will be allotted in settlement of the subscription on 1 April 2019.

AYS stock last traded at $0.640 on 5 March 2019, down 8.571% on the previous close. Over the past 12 months, AYS stock price has fallen by 33.20% with a negative price movement of 29.59% in the past three months.


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