Waterford Wedgwood has reported a loss of €189 million for the year to the end of last March as it announced its fourth cash call in just three years.
The troubled luxury goods maker plans to raise €60 million in an open offer to provide working capital as it continues with its efforts to turn the company around.
Although the group's pretax loss fell to €189.4 million, from €244.8 million a year earlier, chief executive Peter Cameron described last year's result as "underwhelming", "unacceptable" and "plainly disappointing".
But he expressed optimism that the company's fortunes were poised to improve.
"Taking into account the cost savings achieved under the restructuring programme and the new product and marketing initiatives, we are targeting a considerably improved performance this year," he said.
The group, which reported an operating loss of €130.8 million compared to €178.6 million a year earlier, hopes to turn an operating profit in the current fiscal year. It noted that sales in the first two months of the current financial year were around the same as a year ago, while operating profit was on target and ahead of last year as the group benefited from restructuring.
The plan, which will see 2,200 jobs go, 360 more than originally targeted, is designed to cut costs of €90 million each year. It expects to make savings of €70 million in the current year.
Meanwhile, it is raising €60 million through an open offer on the basis of three new shares for every 13 held at a price of six cent per share. The issue, priced at the nominal value of the shares, is below the current share price, unchanged at 4.5 cent last night.
Group chairman Sir Anthony O'Reilly and his brother-in-law and deputy chairman Peter Goulandris have agreed to subscribe for shares in respect of their 51.3 per cent shareholding at a cost of nearly €31 million.
The rest of the open offer is underwritten by Davy Stockbrokers, although the broker retains the right to sell any shares it still holds after a 12-month period to Birchfield Holdings, an investment vehicle owned by Sir Anthony and Mr Goulandris, at the issue price.
The figures released yesterday showed sales rose by 10 per cent to €772.6 million in the 12 months to March 31st, 2006, lifted by the acquisition of Royal Doulton. But if this is stripped out, underlying sales were down by 6.4 per cent.
The company said there were signs in the second half that its turnaround was gaining momentum as operating losses slowed to €30.3 million from €37.9 million in the first half and €52.1 million in the second half of the financial year to last March.
Meanwhile, the company's net debt rose to €371.8 million from €305.2 million over the course of the year as the company haemorrhaged €123.6 million in cash.
Analysts remained cautious about prospects for the company. "We feel that there is little prospect of the share price moving significantly above current levels until the company demonstrates that it can arrest the ongoing decline in sales and make real progress towards a return to profitability," said Philip O'Sullivan of Goodbody Stockbrokers.
NCB Stockbrokers also believes there is still some way to go on the road to recovery. "Although recent trading comments are more favourable, we believe that a pattern of improvement is not yet evident," analyst John Sheehan said.
