Velocity Composites PLC EIS/VCT qualifying funds update (1778C)
June 14 2019 - 2:00AM
UK Regulatory
TIDMVEL
RNS Number : 1778C
Velocity Composites PLC
14 June 2019
Velocity Composites PLC
14 June 2019
VELOCITY COMPOSITES PLC
("Velocity", the "Company" or the "Group")
EIS/VCT qualifying funds update
Velocity Composites plc, the leading supplier of advanced
composite material kits, providing engineering value-solutions for
the global aerospace industry, provides the following update on the
status of the utilisation of the EIS/VCT qualifying funds of
GBP5.0m that were raised at the time of the Company's admission to
trading on AIM in May 2017.
The Group has made promising and rapid progress in recent months
on new business opportunities in a number of new territories. In
particular, as announced on 12 June 2019, the Group is now able to
leverage a potentially significant collaboration agreement with
Wesco Aircraft Holdings, Inc. (NYSE: WAIR), a leading independent
distributor and provider of comprehensive supply chain management
services to the global aerospace industry. The agreement will
require investment by Velocity in the US (a new territory for the
Group).
The agreement will allow Velocity to bring its expertise to bear
in close physical proximity to a number of significant business
opportunities. Physical proximity is considered a critical issue
for many aerospace supply chains. While no revenue generating
contracts have been signed yet, the Board is confident that by
investing in a new and fully resourced facility, co-located at a
site with the collaboration partner, the chances of winning major
new customers in the current pipeline of commercial opportunities
will be significantly enhanced.
A smaller but still significant investment is also planned for a
new site in mainland Europe. The Group has also committed to a
significant new Research & Development centre at its head
office in Burnley, UK. The US and UK projects are expected to be
complete and fully operational in the next twelve months with the
timing of the European site in a similar time frame though
dependent on customer demand.
Therefore, the Group now considers that the combination of
monies already spent (GBP3.2m) and monies firmly earmarked for the
expenditure noted above (which use is in accordance with the EIS
Advance Assurance application made to HMRC) means that the EIS/VCT
funding of GBP5.0m has been employed within the necessary timeframe
for tax purposes.
As the Group has retained the EIS/VCT monies within a separate
bank account kept solely for this purpose, the Group is able to
fund the expenditure detailed above with only a small amount of
additional funding required which is expected to come from cash
flows generated by the Group's improved trading performance.
=== Ends ===
CONTACT DETAILS:
Velocity c/o Camarco
Brian Tenner, Senior Independent Director Tel: 020 3757
4980
finnCap (Nominated Adviser and Broker) Tel: 020 7220
Scott Mathieson / Hannah Boros (Corporate Finance) 0500
Tim Redfern (ECM)
Camarco (Financial PR) Tel: 020 3757
Ed Gascoigne Pees / James Crothers 4980
The information communicated in this announcement contains
inside information for the purposes of Article 7 of the Market
Abuse Regulation (EU) No. 596/2014. Upon the publication of this
announcement via a regulatory news service this inside information
will be considered to be in the public domain.
About Velocity Composites
Velocity Composites is a manufacturer of advanced composite
material kits for the aerospace industry disrupting the composites
supply chain to deliver engineered waste reduction solutions for
its customers to build aircraft components using less time and
material. The Company's customers include multi-national
manufacturers of composite parts and assemblies, who in turn
deliver to the world's leading civil and military aircraft
manufacturers. The Airbus A320, A330, A350, A380, Eurofighter
Typhoon, F35 Joint Strike Fighter and Boeing 737, 787 and V22
Osprey are all constructed using parts manufactured from Velocity's
kits. The Company's business model reduces the operating costs of
preparing composite materials ahead of their usage in the
construction of an aircraft part and as such, its offering is
disposed to being self-financing for aircraft parts' manufacturers.
Velocity's services are seeing increased demand as the global
aircraft industry enters a more-for-less era. Velocity currently
has customers in the UK and Continental Europe.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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