Wynyard announces binding commitments for full $30m rights offer

Wynyard [NZX: WYN] has said it has binding commitments for the full $30 million it plans to raise in a deeply discounted rights offer.

The crime-fighting and security software developer said yesterday it planned to raise about $30 million in a one-for-four renounceable rights offer at 85 cents a share, well below the minimum $2 that shareholders approved in December. The company needs extra funds to meet its working capital requirements by the end of March, having raised $42.6 million in 2015, when its net cash outflow was $32.7 million.

Today, Wynyard announced it had commitments from existing shareholders agreeing to take up their rights, and commitments by existing shareholders and new investors to take up any shortfall, after existing shareholder and oversubscription allocations, at the issue price of 85 cents per share.

"Wynyard can now be confident of raising the full $30 million, which it believes will be sufficient to manage its working capital while sustaining solid growth," it said. "Based on this, the company does not expect to return to the market for further funding to execute its reshaped business plan."

Its shares rose 6.4 percent to $1.

On Tuesday, the company said its annual loss doubled to $44.1 million in 2015 on static revenue while reshaping its business plan to try and achieve cash break-even more quickly.

Total operating costs for the year were $57.1 million of which around 60 percent were people-related.  Revenue for the year was $26.3 million, almost the same as the $26 million achieved in 2014.

The company had entered a contract this month with a partner to provide software and services for a government national security bureau, which was worth $27 million over the life of the contract, including $14.3 million in software licences. But the contract's conditions haven’t yet been met and it couldn’t be included in this year’s results.

Wynyard expects 2016 revenue in the middle of analysts' current forecast range of $54 million to $65 million, plus the licence revenue from the latest deal.

(BusinessDesk)