Pebble Beach Systems Group (AIM:PEB) has proposed a capital reduction that would cancel its £6.95m share premium account, cancel its £617,000 capital redemption reserve and reduce the nominal value of each ordinary share from 2.5p to 0.5p.
The broadcast and streaming software provider says the actions would move £6.95m into distributable reserves, free a further £617,000 and £2.53m.70 from the capital redemption reserve and nominal-value reduction respectively, and convert a retained deficit of £5.7m.90 at 31 March into a surplus of £4.4m.80 on unaudited unconsolidated figures, the company said.
Shareholders would keep the same 126.6m shares and the shares would remain fully paid, but the change requires shareholder approval at a general meeting on 24 June and subsequent confirmation by the Court before it takes effect.
The board notes the proposal is prompted by positive trading momentum, ongoing reductions in indebtedness and an expectation that the group will be in a net cash position during the financial year, giving it flexibility to consider future distributions or capital returns.
Trading in the first quarter has been encouraging, with project order intake and service-level agreement renewals in the first five months keeping revenue and profit in line with management expectations and including a significant US-based streaming project win this year.
The circular was published on 8 June, proxy votes must be received by 11:00 on 22 June, the general meeting is at 11:00 on 24 June, an initial directions hearing is expected on 15 July, the court hearing to confirm the reduction on 28 July and an expected effective date of 30 July, subject to the Court's timetable.
