Yowie Group has proposed a four per cent share capital return, subject to shareholder approval.
The company proposed to reduce its share capital by returning four cents per ordinary share held by each shareholder at 7.00pm (EST) on Tuesday 30 June 2020.
In a statement to the ASX, Yowie Group company secretary Neville Bassett said the decision reflected the board’s consideration that Yowie had surplus capital at the end of April 2020 in excess of its working capital requirements. It currently had US$11 million in cash and the capital return would take about US$5.7 million from that.
The company made a similar offer in July 2019 when it planned to pay shareholders a two cents per share special dividend as it would have more than US$16 million cash on hand. In September it revealed assets had been incorrectly valued and reported a $741,000 write-down.
2020 has been a quieter year for the company than 2019. Last year it faced hostile takeover bids from Keybridge Capital and Aurora Dividend Income Trust (Food & Drink Business 20/03/2019, 22/05/2019).
Then in July, the Australian Securities and Investment Commission (ASIC) appointed Morgan Stanley Wealth Management Australia to sell 28 million Yowie shares (12.92 per cent of its issued capital) which had been purchased in the Keybridge Capital takeover attempt that ASIC deemed contravened the Corporations Act (Food & Drink Business, 05/06/2019) .
In October, Yowie Group said its first quarter results showed it was on track to deliver net sales growth, improved EBITDA and a positive operating cash run rate in the full year. Sales in the first quarter increased by 23 per cent over the previous year, up to US$4.5m, while losses shrank from US$178,000 to US$22,000. Operating cashflow was breakeven, compared to a US$519,000 burn in the corresponding period last year (Food & Drink Business, 29/10/2019).