Troubled DX Group has released its preliminary annual results. It also confirmed the proposed changes to straighten out its management board have come into effect.
Regarding the board of directors, Ron Series has assumed the role of Chairman, replacing Bob Holt. Lloyd Dunn, who was the temporary CEO, now joins the board. Russel Black and Paul Goodson are to be non-executive directors. While consulting into the firm, Paul Murray is to retire as a non-executive director. Ian Gray is to remain as a non-executive director until the 2018 DX Group AGM.
Despite the well documented problems with DX Group turnover was up. It announced a revenue for the year end 30 June at £291.9 million, up from £287.9 million in 2016. Its EBITDA was £7.2 million, a dramatic fall from £18 million in 2016, a better indication of the troubles the delivery and logistics firm has had. Overall there was a loss before tax of £82.3 million, a little less than the £82.7 million loss of 2016.
Bob Holt, the outgoing Chairman of DX, said: “The year to 30 June 2017 and the first few months of the new financial year have been an especially challenging period for the Group, and DX’s full year results, and current trading, reflect this.
“However, the Company’s prospects have been significantly transformed, with the appointment today of a new leadership team, headed by Ron Series as Chairman and Lloyd Dunn as CEO, and a major new financing agreement. This agreement, which raises £24m of new funds, is supported both by our major institutional shareholders, including Gatemore Capital and Hargreave Hale, and by DX’s new Board Directors.”
Commenting on both the results and board changes, Liad Meidar, Managing Partner & Chief Investment Officer at Gatemore Capital Management, said: “We are happy to see the new board installed and the Company fully financed following our 8-month campaign to affect change at DX Group. Appropriately, they have decided to take substantial non-cash write-offs, positioning the Company for a fresh start.
“For FY 2017, the Company posted EBITDA of £7.2 million. This includes an EBITDA loss of £18.3 million for the freight division. We could not have a stronger team leading the turnaround of this part of the business. Ron Series and Lloyd Dunn turned around DX Freight’s main competitor, Tuffnells, and brought it from loss-making to over 9% operating margins. We do not see any reason why this cannot be achieved again over time.”
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