Update on strategic review

 

TIDMRLX 
 
RNS Number : 2582Z 
Relax Group PLC 
17 September 2009 
 

 
 
17 September 2009 
 
 
Relax Group plc ("Relax Group" or the "Group") 
 
 
Update on strategic review 
 
 
On 11 August 2009 the Group announced that the new management team led by Ken 
Gaskell was  undertaking a strategic and financial review of the business and 
wider management structure. 
 
 
A lack of financial discipline, forward planning and aggressive accounting 
practices over the last three years coupled with delays in responding to market 
changes and over manning has left the Group in a heavily indebted position with 
a large backlog of creditors and a legacy of ongoing contractual lease 
commitments. 
 
 
Significant cost cutting measures have been taken and the Group is now in a 
position to grow the business back to profitability. This cannot be done, 
however, without a resolution of the Group's financial position. Further funding 
is required and the company is looking at equity fundraising options and is in 
discussion with its lenders. 
 
 
The Group is due to report its interim results for the six months ending 30 June 
2009 on 30 September. These results will show a substantial loss and include 
significant write downs in relation to intangible and other assets. The results 
may also require a restatement of the reported figures for the five months ended 
31 December 2008. The Group remains optimistic that the restructured business is 
capable of delivering well above market growth rates, subject to working capital 
support. 
 
 
Enquiries: 
 
 
+------------------------------------+------------------------------------+ 
| Ken Gaskell/Bernard Asher          | 020 7898 0512                      | 
+------------------------------------+------------------------------------+ 
| Relax Group plc                    |                                    | 
+------------------------------------+------------------------------------+ 
|                                    |                                    | 
+------------------------------------+------------------------------------+ 
| Stephen Keys/Beth McKiernan        | 020 7397 8900                      | 
+------------------------------------+------------------------------------+ 
| Cenkos Securities plc              |                                    | 
+------------------------------------+------------------------------------+ 
. 
 
 
 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
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