15
October 2024
FRANCHISE BRANDS
PLC
("Franchise Brands", the "Group" or the "Company")
Re-commencement of Share
purchase programme
Franchise Brands has been quoted on
London's AIM market since its IPO in 2016. AIM has been a highly
supportive stock exchange for the Group, enabling it to access
appropriate capital to facilitate acquisitions and grow and
diversify its share register.
The Board believes that recent
speculation about the potential impact of any changes to
Inheritance Tax legislation in the Autumn Budget on 30 October
2024, including potential removal of Business Property Relief for
qualifying companies quoted on AIM may have contributed to recent
volatility in the Company's share price. In times of such
volatility, anomalies in the share price present opportunities to
act in the interests of all shareholders and purchase shares,
particularly when the Board believes that the share price
significantly undervalues the Group. Therefore, the Board now
believes that it would be in the interests of all shareholders to
re-commence the share purchase programme (the
"Programme").
Franchise Brands will re-commence its
discretionary Programme to buy ordinary shares of 0.5p each in the
Company ("Ordinary Shares") with immediate effect, up to an
aggregate value of £5,000,000.
The Trustee of the Franchise Brands
PLC Employee Benefit Trust (the "EBT") will purchase Ordinary
Shares in accordance with the Programme. The Programme seeks to
mitigate the dilutive impact of share option awards and to improve
overall shareholder return. The EBT currently holds 983,510
Ordinary Shares which represents 0.51 per cent. of the Company's
current issued share capital.
The Board remains focused on debt
reduction, a progressive dividend policy and investment in the
organic growth of the Group and whilst this modification to its
capital allocation policy will modestly extend the debt
reduction timetable, the Board still anticipates the full repayment
of outstanding bank debt by the end of 2027, and leverage to 31 December 2024 of
less than 2 times* in line with previous
guidance.
The Trustees of the EBT have entered
into arrangements with the Company's joint broker, Stifel Nicolaus
Europe Limited ("Stifel"), to carry out on-market purchases of
Ordinary Shares under the Programme, including on a discretionary
basis independent of the Company during any prohibited periods of
the Company, as determined by the UK Market Abuse Regulation, which
may fall during the period of the Programme.
Due to the limited liquidity in the
issued Ordinary Shares, any share purchase of Ordinary Shares
pursuant to the authority on any trading day may represent a
significant proportion of the daily trading volume in the Ordinary
Shares on the London Stock Exchange and may exceed 25 per cent. of
the average daily trading volume, being the limit laid down in
Article 5(1) of Regulation (EU) No 596/2014 (as incorporated into
UK domestic law by the European Union (Withdrawal) Act 2018) and
the Commission Delegated Regulation (EU) 2016/1052 (as incorporated
into UK domestic law by the European Union (Withdrawal) Act 2018)
and, accordingly, the Company will not benefit from the exemption
contained in that Article.
*Leverage is calculated using Adjusted net debt and Adjusted
EBITDA.
This announcement contains inside
information for the purposes of Article 7 of the Market Abuse
Regulation (EU) 596/2014 as it forms part of UK domestic law by
virtue of the European Union (Withdrawal) Act 2018 ("MAR"), and is
disclosed in accordance with the Company's obligations under
Article 17 of MAR.
Enquiries:
|
Franchise Brands plc
|
+ 44
(0) 1625 813231
|
|
Stephen Hemsley, Executive Chairman
|
|
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Andrew Mallows, Interim Chief Financial
Officer
|
|
|
Julia Choudhury, Corporate Development
Director
|
|
|
|
|
|
Stifel Nicolaus Europe Limited (Nominated Adviser and Joint
Broker)
|
+44
(0) 20 7710 7600
|
|
Matthew Blawat
|
|
|
Nick Harland
|
|
|
|
|
|
Allenby Capital Limited (Joint Broker)
|
+44
(0) 20 3328 5656
|
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Jeremy Porter / Liz Kirchner (Corporate
Finance)
|
|
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Amrit Nahal / Joscelin Pinnington (Sales &
Corporate Broking)
|
|
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|
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Dowgate Capital Limited (Joint Broker)
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+44
(0) 20 3903 7715
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James Serjeant (Corporate
Broking)
|
|
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Malar Velaigam / Colin Climie
(Sales)
|
|
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MHP
Group (Financial PR)
|
+44
(0) 20 3128 8100
|
|
Katie Hunt / Hugo Harris
|
+44
(0) 7884 494112
|
|
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franchisebrands@mhpgroup.com
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About Franchise Brands plc
Franchise Brands is an international,
multi-brand franchisor focused on B2B van-based service with 7
franchise brands and a presence in 10 countries across the UK,
North America and Europe. The Group is focused on building
market-leading businesses primarily via a franchise model and has a
combined network of over 625 franchisees.
The Company owns several
market-leading brands with long trading histories, including Pirtek
in Europe, Filta, Metro Rod and Metro Plumb, all of which benefit
from the Group's central support services, particularly technology,
marketing, and finance. At the heart of Franchise Brands'
business-building strategy is helping its franchisees grow their
businesses: "as they grow, we grow".
Franchise Brands employs over 650
people across the Group.