Charlie’s abandons plans to raise equity as trading picks up:

Friday 19th February 2010

Charlie’s Group, the juicemaker set up by Stefan’s Orange Juice founder Stefan Lepionka and entertainer Mark Ellis, has abandoned plans to raise more capital, saying a return to profitability has taken the pressure off its balance sheet.

Chairman Ted van Arkel said an equity raising was “no longer necessary given the profitable trading of Charlie’s and the substantially improved balance sheet.” Still, he didn’t rule out raising new capital in the future if “an attractive opportunity or specific project” that fitted the company’s strategy came up.

Last month, the juicemaker said the sale of its Henderson property, cost-cutting and growth in Australia pushed it into the black, and it expected to make a profit of between $1.7 million and $1.8 million in the six month through December. The Auckland-based owner of Charlie’s and Phoenix Organics drinks brands posted its second full-year loss in a row in August.

Since then, Charlie’s has been focused on cutting down debt after its largest shareholder, Collins Asset Management, provided it with a $5.3 million guarantee to support its bank facilities with ANZ National Bank.

The company announced it negotiated the release of the guarantee after paying down $2.8 million of the $7.1 million debt with the bank. It plans to make a further $500,000 repayment by February 28, taking its total debt down to $3.8 million.

“The confidence the ANZ National bank has shown by releasing the Collins guarantee is particularly pleasing,” van Arkel said in a statement. “I would like to again thank Collins for their ongoing support and for providing the guarantee originally, which is now no longer required by the bank.”

Collins, owned by director Tim Cook, holds about 19% of Charlie’s shares.

The stock gained 3.2% to 9.6 cents in trading on the NZX today.

Businesswire.co.nz

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