Cobra says full benefits of disposals will not come through in full-year results
Cobra issued a profit warning today, alerting shareholders that its earnings will be affected by last year’s sales.
Last year Cobra sold its broking operations in Caterham and Alton to Aston Scott, along with Cobra Corporate Solutions.
Cobra said today the £6m netted from the deals had helped trim borrowings and strengthen its financial position. Depending on trading performance, around £2.7m of this will filter in December 2012 and December 2013 to further reduce borrowings.
The disposals equated to around 30% of the firm’s underlying earnings and the “impact of which will be material” on the full-year results ending March 31.
There will also be goodwill impairments and restructuring costs that will impact operating income.
At the end of February, Cobra had cash balances of around £3.3 million (2011: £0.8 million) and borrowings of around £12.0 million (2011: £15.0 million).
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