StockMarketWire.com - IT services provider Redcentric scrapped its dividend and said it would raise capital to fund restitution costs of £11.4m related to accounting mistakes.

The costs were part of a settlement agreed with the UK's Financial Conduct Authority, which had wrapped up an investigation into historical accounting misstatments at the company.

Redcentric launched a placing and subscription to raise £5.8m, at 110p per share.

The company said it would not pay a final dividend for the 2020 financial year, citing the restitution payments and Covid-19 uncertainty.

In an accompanying trading update, Redcentric said it had been encouraged by its trading performance in the year to date.

Recurring revenue orders received in the first quarter were expected to be marginally up on-year, and significantly ahead of the company's expectations.

Redcentric however, also said that it had experienced customers deferring decisions on large-scale IT projects due to Covid-19.


At 9:29am: [LON:RCN] Redcentric PLC share price was +25p at 127p



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