Augean Plc Bank Facilities and HMRC Landfill Tax Payment (2721W)
10 Dicembre 2019 - 8:00AM
UK Regulatory
TIDMAUG
RNS Number : 2721W
Augean Plc
10 December 2019
Augean plc
("Augean" or "the Group")
Renewal and Extension of Bank Facilities and HMRC Landfill Tax
Payment
Augean, one of the UK's leading specialist waste management
businesses, announces that it has renewed and extended its banking
facilities and has paid all outstanding disputed HMRC Landfill Tax
assessments and interest accrued to date.
Bank Facilities
The Group has renewed and upgraded its Banking Facilities
("Facilities") with HSBC UK Bank plc ("HSBC").
Under the terms of the amended Facilities, the Group may draw
down a Revolving Credit Facility of GBP20m and additional loans up
to an aggregate value of GBP20m on materially similar covenants and
pricing as the Group's previous GBP20m Revolving Credit
Facility.
The new Facilities are for a three year term with the
flexibility to be extended for a further one or two year term as
the parties agree.
The Facilities may continue to be used by the Group for working
capital and general corporate purposes and have been extended to
cover any payments to HMRC pursuant to the previously announced
landfill tax assessments.
Landfill Tax Assessments
From August 2017, the Group has been in receipt of assessments
(including accrued interest) and penalties for Landfill Tax. The
total value of assessments received, including with interest
accrued to the date of the assessments of GBP2.7m, is GBP40.4m.
This figure is GBP4.6m lower than has been previously announced
(over the last two years) as HMRC has withdrawn the penalties
notice for Augean South whilst it reviews it (potentially to
re-issue it).
Despite its strong growth since 2017, the Group has endured
considerable uncertainty due in a large part to HMRC's actions,
which has imposed significant constraints on the Board's management
of the business and its further development. As a Group, we are now
in a position to use our cash balances (c. GBP28m at the end of
November 2019), together with the Facilities, to pay all HMRC
assessments received in full. These have been paid to stop any
further accrual of interest from today (should HMRC's case succeed)
and allow the Group to (i) receive an appropriate Corporation Tax
deduction for the relevant expense which will be treated as an
exceptional item in the results for the year ending 31 December
2019; and (ii) look forward unencumbered by this matter and use its
cash generation and gearing to facilitate further growth and
development.
The Group continues to robustly challenge the LFT Assessments
through the tax tribunal system with the first hearing expected to
be heard in 2020.
Jim Meredith, Executive Chairman of Augean, said:
"The Group is pleased to have agreed the amended Facilities with
HSBC increasing their flexibility of use. Based on legal advice
received, we maintain our position that we have correctly collected
and paid the appropriate landfill tax, and we will continue to
robustly challenge the assessments received through the tax
tribunal system. Nonetheless paying these assessments fully will
enable the Group to focus on implementing its strategy for creation
of further value."
- Ends -
Enquiries:
Augean plc
Jim Meredith, Executive Chairman
Mark Fryer, Group Finance Director 01937 844 980
N+1 Singer
Shaun Dobson
Peter Steel
Rachel Hayes 020 7496 3000
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END
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