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Gold rush is all over for pawnbroker BY GRAEME EVANS wdbusiness@b-nm.co.uk Desperately needing to raise some quick cash to shore up the finances is not an unfamiliar requirement at a pawnbroker. But at Britain’s second biggest – founded in the Bristol suburb of Bedminster – it is the pawnbroker itself that is feeling the financial pitch. Attempts by Albemarle & Bond to secure a £35 million cash injection have failed to come to fruition. It said it had not been able to
59%
Albemarle & Bond shares lost half value yesterday, down 41p to 28p conclude negotiations with its biggest shareholder over a deeply-discounted rights issue, which it needs in order to repair its balance sheet. The company – which opened the first of its more than 200 branches in East Street, Bedminster in 1983 – is now focused on talks with its lenders after they agreed a month’s breathing space on covenant tests due on the £51 million debt pile. Albemarle said the deferral agreement included the appointment of a chief restructuring officer. Shares in the firm, now based in Reading, slumped by 59 per cent yesterday and have dropped by around 80 per cent
over the last year. Andrew Watson, an analyst at N+1 Singer, said the latest developments placed the company in a “precarious position”. He added: “Albemarle now has a reduced lending facility and faces the prospect of a near-term restructuring approaching a covenant test at the end of this month. We believe that this could result in store closures and staff reduction.” The company has been slashing costs, including through the closure of 33 popup gold buying stores, as it looks to overcome the impact of the sliding gold price on its finances. The group, which had around 230 stores, has recently appointed a new chief executive in Chris Gillespie from doorstep lender Provident Financial. But the outcome of four months of talks with Texasbased EZCORP, its biggest shareholder, over underwriting the £35 million cash call failed to win the backing of Albemarle’s board. With the test of its banking covenants now delayed until October 30, Albermarle said it was focusing its efforts on “constructive discussions with the banks to explore all possible options to remedy potential covenant breaches later in the current financial year.” The price of gold has plunged by about a third over the past two years, squeezing the group’s profitability and leaving it at “high risk” of breaching banking covenants.
West business cautiously backs the PM West Country business leaders have largely praised Prime Minister David Cameron’s pro-business speech to the Conservative Party conference. The Prime Minister told the conference in Manchester that the UK economy was “beginning to turn the corner” and pledged to build “a land of opportunity for all” by backing business, home-ownership and education as times get better. Tory activists heard that profit, wealth creation, tax cuts and enterprise are “not dirty words” Phil Smith, managing director of Business West, said: “It is encouraging to hear the
Business West managing director Phil Smith backed Mr Cameron’s keynote speech
Prime Minister David Cameron praised his wife – Bristol University graduate Samantha – as an example of a British entrepreneur during his business-focussed speech to the Conservative Party conference yesterday
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Prime Minister put enterprise, wealth generation and aspiration at the forefront of his speech. This will strike a chord with businesses of all sizes, as only business growth can propel Britain's economy from being just good to being truly great. However fine words demand fine deeds and business will want to see ambitious and rapid actions from the government particularly in getting British infrastructure fit for purpose. “We also support his mission to ensure that everyone under the age of 25 is either ‘earning or learning’, as we cannot allow Britain’s next generation to be left behind. “But if our political class descends into cheap electioneering and giveaway politics, it will have wasted a once-in-ageneration attempt to build a
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