AGH 3.75 0.00 Vol 0 AGL 21 0.50 Vol 15800 BAS 1.52 0.00 Vol 0 BFM 16.16 0.00 Vol 0 BG23B 98.0011 0.00 Vol 0 BPH 7 0.00 Vol 0 DEVON 3.55 0.00 Vol 0 LOM 2.5 0.00 Vol 0 NTB 40.35 0.85 Vol 1950 ONE 3 0.00 Vol 0 POLAR 5 0.00 Vol 0 SOM 15.5 0.00 Vol 0 WHHL 3.75 0.00 Vol 0 WWW 21.5 0.00 Vol 0
Market Closed:

SRT Marine Systems PLC -Result of Placing and Loan Note Refinancing

Hamilton, Bermuda—14 June 2018: SRT Marine Systems PLC, announced on Wednesday 30 May 2018 Result of Placing and Loan Note Refinancing. The full filing stated:



("SRT" or the "Company")


Placing to raise £3.0 million and Loan Note Refinancing


SRT, the global provider of maritime surveillance, vessel tracking, monitoring and management systems, is pleased to announce that it has raised gross proceeds of £3.0 million through a placing of 12,000,000 new ordinary shares of 0.1 pence each in the capital of the Company ("Ordinary Shares") at a price of 25 pence per Ordinary Share (the "Placing"). The Placing will provide the Company with growth capital and working capital to fund new and ongoing systems projects as well as to accelerate product development. In addition, the Company is refinancing £1.15 million of short term loan notes and will issue new three year loan notes to the same value (the "Loan Note Refinancing").


Summary of the Placing and Loan Note Refinancing


·      The Placing is to raise gross proceeds of £3.0 million at a price of 25 pence per new Ordinary Share (the "Placing Price").


·      Application will be made for the new Ordinary Shares to be admitted to trading on AIM ("Admission"). It is expected that that Admission will become effective at 8.00 a.m. on 4 June 2018 and that dealings in the Ordinary Shares will commence at that time.


·      The Loan Note Refinancing has been arranged by LGB Corporate Finance ("LGB").



Reasons for the Placing and use of proceeds


The Placing has been conducted with institutional and existing shareholder support. The net proceeds of the Placing will be used to provide growth capital and working capital to fund new and ongoing systems projects as well as to accelerate product development.



Commenting on the Placing, Simon Tucker, CEO of SRT said:


"Our maritime surveillance and monitoring systems business has transformed SRT. In addition to our day to day transceivers business we are now addressing substantial systems project opportunities around the world, with £30.5 million of ongoing projects and a validated pipeline of £419 million, of which £119 million are classified as being in the final procurement phase. Most of these projects are with sovereign governments and thus there are some initial working capital requirements in the early stages of each project, however going forward this will be minimised through the use of the UKTI export financing programmes which enables risk and working capital to be substantially reduced. This per project working capital from the UKTI export finance programs will be supplemented by the new capital we have raised today, which we intend to also use to accelerate our systems product development."


Update on Projects and Pipeline


The Company is pleased to provide further information on the Asian project referred to in its year end trading update announcement dated 11 April 2018. This project is set to provide SRT's VMS System to a country in South East Asia and has an anticipated total contract value of £25 million, payable over four years. Project contracting and financing is currently being finalised to allow payments to commence for project deliveries which have already been undertaken. This process has continued longer than initially expected due to budget re-allocation by the country's government from a foreign government loan to its own internal funds.


The Company also advises that a £5 million project with a Middle Eastern country, revenue from which is payable over two years, is being re-negotiated to expand the original project plan. The expanded project plan will include the provision of transceivers in the first phase of the project, which is earlier than previously anticipated. This re-negotiation has resulted in the delay of receipt of £1.2 million due to SRT.


In its Systems Business Validated Sales Opportunity Pipeline ("VSP"), the Company currently has the following revenue opportunities:


·      two systems projects that are ongoing that will generate £30.5 million; and

·      ten systems projects at the procurement stage that would generate a total of £119 million; and

·      eleven systems projects at the planning stage that would generate a total of £167.5 million; and

·      six systems projects at the specification stage that would generate a total of £132.5 million.


Therefore the Company has a total of £419 million of validated sales opportunities being discussed with new and existing customers, up from £273 million 12 months ago. The majority of these sales opportunities are direct with government entities and are driven by a combination of national security and fisheries management concerns, some of which are provided with further imperatives by international and regional regulations such as the EU Fish Catch Certification and IUU program.


The nature of the government projects is that payment terms are often extended and variable and thus often result in a working capital gap during the initial delivery phases. The UK Trade & Industry Department ("UKTI") offers a range of export finance solutions aimed at assisting UK companies such as SRT with the credit challenges associated with exporting. SRT intends to make use of the various UKTI credit guarantee programs that will enable SRT to accelerate cash receipts associated with our systems business and thus significantly reduce the working capital required for projects, whilst also enabling customers to maintain their payment budgets.


Details of the Placing


finnCap Ltd ("finnCap") acted as nominated adviser, broker and sole bookrunner in connection with the Placing.


The Placing is subject to the terms and conditions set out in the appendix (the "Appendix") to this announcement (which forms part of this announcement, such announcement and the Appendix together being, this "Announcement"). The Placing was not underwritten.


By participating in the Placing and by making an oral and/or written legally binding offer to acquire new Ordinary Shares, investors will be deemed to have read and understood this Announcement in its entirety, including the Appendix, and to be making such offer on the terms and subject to the conditions contained herein and to be making the representations, warranties, undertakings and acknowledgements contained in the Appendix to this Announcement.


The new Ordinary Shares, when issued, will represent approximately 9.4 per cent. of the Company's issued share capital prior to the Placing. The Placing Price of 25 pence per new Ordinary Share represents a discount of approximately 4.8 per cent. to the closing mid-market price of 26.25p pence per Ordinary Share on 29 May 2018, being the last trading day immediately preceding the date of this Announcement.


The new Ordinary Shares, when issued, will be fully paid and will rank pari passu in all respects with the existing Ordinary Shares, including the right to receive all dividends and other distributions declared, made or paid in respect of such Ordinary Shares after the date of issue.


Related Party Transaction


The participation by Robert Persey in the Placing is a related party transaction under Rule 13 of the AIM Rules as Mr Persey is a substantial shareholder in the Company.


The Directors of the Company, having consulted with finnCap in its capacity as the Company's nominated adviser for the purposes of the AIM Rules, consider the terms on which Robert Persey participated in the Placing to be fair and reasonable insofar as the Company's shareholders are concerned.




Application has been made for the new Ordinary Shares to be admitted to trading on the AIM market ("AIM") of the London Stock Exchange ("Admission"). Settlement for the new Ordinary Shares and Admission is expected to take place at 8.00 a.m. on 4 June 2018. The Placing is conditional, inter alia, upon Admission becoming effective and the placing agreement between the Company and finnCap (the "Placing Agreement") not being terminated in accordance with its terms.


On Admission the Company's issued share capital will comprise of 139,742,419 Ordinary Shares, with no Ordinary Shares held in treasury. Therefore the total number of Ordinary Shares in the Company with voting rights will be 139,742,419. This figure may be used by shareholders in the Company as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Company under the FCA's Disclosure Guidance and Transparency Rules.


The Appendix sets out further information relating to the Placing and the terms and conditions of the Placing.


Details of the Loan Note Issue


In December 2017 LGB Corporate Finance arranged a £10 million secured loan note programme for SRT, to be used as a treasury management tool and to support the Company's working capital and capex requirements.


The loan note programme was established concurrent with a £2 million initial issue of three year notes, with a further short term issue of loan notes of £1.15 million issued in March 2018 making a total of £3.15 million of loan notes in issue. Notes issued under the programme are secured and rank second to a previously provided senior secured term facility of £1.0 million with Barclays Bank, under which £375,000 is currently outstanding and expected to be repaid in full this financial year.


The Company now intends to use the loan note programme to issue new three year loan notes in the total principal amount of £1.15 million which will be used to repay the existing £1.15 million of short term loan notes which were issued in March 2018 under the programme. Following completion of this transaction, the Company will have a total of £3.15 million three year term loan notes outstanding of the £10 million secured loan note programme.


This Announcement should be read in its entirety. In particular, you should read and understand the information provided in the "Important Notices" section of this Announcement.







SRT Marine Systems plc

+ 44 (0) 1761 409500



Simon Tucker (CEO)


Louise Coates (Marketing Manager)



finnCap Ltd



Jonny Franklin-Adams / Simon Hicks (Corporate Finance)

+44 (0) 20 7220 0500


Tim Redfern / Richard Chambers (Equity Capital Markets)





About SRT Marine Systems plc:

SRT develops, manufactures and supplies maritime surveillance and vessel tracking technologies, products and systems. The Company's products and solutions are used by individual vessel owners, port authorities, maritime infrastructure owners, coast guards, fishery agencies and other national security agencies to enhance their maritime domain awareness, monitoring and management capabilities. Applications include the tracking of commercial and leisure vessels; sustainable fishery; anti-collision; search and rescue; waterway management, port and coast security; pollution management; and environmental management.



The information communicated in this announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014. In addition, market soundings (as defined in MAR) were taken in respect of the Placing with the result that certain persons became aware of inside information (as defined in MAR), as permitted by MAR. This inside information is set out in this Announcement. Therefore, those persons that received inside information in a market sounding are no longer in possession of such inside information relating to the Company and its securities. The person responsible for this announcement is Richard Hurd, Chief Financial Officer of SRT.


Risk factors


·      The nature of SRT's customers means that the status of a system opportunity and or contract can materially change suddenly and without notice.

·      SRT's systems business is driven by governments and thus can be subject to significant risk including but not limited to: the forecasting of project commencement dates and project delivery schedules, political and financial change and uncertainty, sudden cancellation and or changes to contracts without the possibility for redress, renegotiation and or compensation.

·      Different customers and countries have different procurement and legal processes, which are often opaque and difficult to understand, and can mean that projects are undertaken where contracts do not exist and or are not legally enforceable.

·      Revenue and profit numbers announced for year ending 31st March 2018 are subject to audit and contain material revenues recognised from systems business and therefore may be subject to material adjustment upon audit.

·      Payment terms are frequently extended and variable and in the event of non-payment may not be collectable due to the nature of the customers.

·      Delivery schedules can be highly variable due to factors such as manufacturing supply chain issues and local in-country issues such as availability of hosting infrastructure, import issues and customer co-operation issues resulting in significant project delivery and therefore revenue delays.

·      The presence of an existing contract with an existing customer does not provide surety that there will be future follow on contracts.

·      As SRT enters multiple project contracts, project execution risk will become an increasing challenge.





This Announcement has been issued by and is the sole responsibility of the Company.



08:30-09:00 Price Discovery
09:00-16:30 Continuous Trading


TEL: +1 (441) 292 7212
FAX: +1 (441) 292 7619


30 Victoria Street
3rd Floor
Hamilton, Bermuda


P.O. Box HM 1369
Hamilton HMFX



The information contained in these pages has been obtained from sources which The Bermuda Stock Exchange believes are reliable. However, the accuracy of the information cannot and is not guaranteed and The Bermuda Stock Exchange makes no representation as to its accuracy or completeness. Neither this Web site, nor any information contained herein, constitutes advice or a solicitation to subscribe, purchase or sell any securities. The Bermuda Stock Exchange expressly disclaims any liability whatsoever for any loss howsoever arising from or in reliance upon any part of the contents of this site or any external sites referenced from this website.