With Unstable Cash from Support Services Sector, Mouchel Stands at Lowest Shares Drop
With shares having dropped in October 28, 2010, on day of announcement of Q2 2010 loss, suffered by Mouchel due to further cut of UK government financing in 2010, from 126p to 88p in one day, consulting and business services firm Mouchel has sustained a 80p to 58.25p drop prior to its 66p close and continues to fall below 60p on December 3, 2010 midday.
Mouchel lenders had hammered weak hopes in the investors of the company yesterday as they appointed Deloitte to go over the financial future of the firm before its planned refinancing, which it hopes to released by March next year.
David Tilston, finance director at Mouchel, expressed confidence the refinancing will get over by that time in his speech soon after release of information about Deloitte’s audit.
For the financial year ended July 31, Mouchel recorded a 13.5 million pounds loss, according to a statement released by Regulatory News Service.
Mouchel’s appointment of Deloitte to review its business came after its lending syndicates Royal Bank of Scotland, Barclays and Lloyds had hired the same accounting firm.
Deloitte, which will carry out a “targeted” review, will look at how reductions in the government spending will impact the company’s future cash flow.
Currently Mouchel depends largely on government contracts. It provides assistance in the development and management of infrastructure assets for its clients, being a consulting and business services company. It establishes its operations in government services, regulated industries and highways.
Mouchel also works hand-in-hand with authorities in health and education sector to provide services to the central and local government.