WH Ireland Group plans has raised £5mn through an emergency placing following a pre-tax loss of just over £1mn.
In an announcement this morning (July 28), the firm said it was looking for the money from investors after it grappled with losses.
In a subsequent announcement, the firm said it had closed the placing and had managed to raise the £5mn.
The group intended to raise the money through the issue of new ordinary shares in the capital of the company to certain existing shareholders and other investors at a price of 3 pence per share.
The firm also confirmed that CEO Phillip Wale agreed to sacrifice around 30 per cent of his salary to help the firm.
Wale said: “The proceeds of today’s placing bolsters our regulatory capital and together with the cost reductions we are implementing, we believe provide a stable platform from which the company can navigate these challenging markets.
"I am grateful for the support of our existing and new shareholders and believe we are in a stronger position to take advantage of better market conditions as and when they come.”
It comes after WH Ireland made a pre-tax loss of £1.1mn on revenues of around £5.6mn between April and June this year.
This was was attributed to the multi-year low level of transactional activity in the financial capital markets which has impacted the group's capital markets division.
This occurred alongside a reduction in assets under management for the group's wealth management division, in part due to weaker market conditions impacting client portfolio size.
With market conditions "remaining challenging", WH Ireland's directors do not believe that there will be an improvement in CM transactional activity during the current quarter.
The directors have therefore said that they believe the group will remain loss making until at least November 2023.
In order to reduce costs, the company announced that it will commence a consultation to look at reducing its headcount.
In addition, it is proposed that certain senior management team members would sacrifice a proportion of their salary.
This programme is anticipated to reduce annual costs by £3.75mn to £4mn, with the full extent of the savings to be realised during Q4 2023.
The directors have stated their belief that the combination of the placing and the cost reduction exercise gives the group an improved chance of returning to a break-even position and securing the future of the group.
tom.dunstan@ft.com
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