Time Out Group PLC (AIM:TMO) shares fell 25.2% to 8.6p after it reported a widening full-year loss and launched a fundraising to raise £8 million.
The company said the capital raise would be carried out through a firm placing, conditional placing and a retail offer at 8.0p per share, a 30.4% discount to the closing price prior to the announcement. A total of 100 million new ordinary shares are expected to be issued, excluding the retail offer.
Oakley Capital Investments (AIM:OCI) has committed to the £2.9 million firm placing. Lombard Odier has committed to taking up almost half of the 64.3 million of the shares in the conditional placing, with OCI has agreed to buy 2.3 million and its investment advisers Oakley Capital Ltd another 4.38 million, as well as committing to take up any additional conditional placing shares not bought by other investors.
The funds raised will be used for working capital, including one-off restructuring costs, and to support technology investment and expansion of Time Out's markets and media businesses.
In preliminary results for the year to 30 June, the company revealed that revenue fell to £73.2 million from £103.1 million and adjusted EBITDA declined to £7.1 million from £12.4 million.
An operating loss of £49.7 million was recorded, driven by £35.1 million in impairments and £9.2 million in exceptional restructuring costs.
Cash at year-end was £2.6 million, with borrowings of £46.9 million, resulting in adjusted net debt of £44.3 million.
"Following three consecutive years of improving EBITDA, in FY25 the media industry experienced a number of challenges which resulted in a lower EBITDA," said chief executive Chris Ohlund.
"We have taken decisive action and as a result have seen a material improvement in performance since the financial year end.
"The changes will result in a stronger and more focused business, positioning Time Out for a return to profitable growth. The Time Out brand continues to have multiple growth avenues and significant global potential, offering a unique proposition, both for our audience and for our commercial partners."