HIDDN – Financial results for the second quarter of 2019
Enclosed please find Hiddn Solutions ASA’s report for the second quarter of 2019.
Important events in the second quarter of 2019 and year-to date
- Significant changes in the Group’s operations
The subsidiary, Hiddn Security AS, reported lower operating revenue than budgeted and continued loss making during first quarter of 2019. This negative trend increased in second quarter of 2019. A new assessment of future sales and probabilities to find bases for a profit-making business was performed. The conclusion from the assessment was that this would involve unacceptable risk and call for additional future funding. Hence, Hiddn Security AS had to enter a petition for bankruptcy proceedings with Oslo enforcement, bankruptcy and probate Court. The petition was filed 21 May 2019.
- Changes in management
Carl Espen Wollebekk resigned from his position as CEO in July 2019. Chairman of the Board Mr. Øystein Tvenge acted as CEO on a temporary basis until Jørgen Waaler was appointed as CEO for the Company through a part-time management for hire agreement effective from 1 August 2019.
- Recapitalization efforts – secured commitments in a private placement
On 3 July 2019, the Company announced that it was insolvent and operated at a loss. Notwithstanding the situation, the Board of Directors considered that there were grounds to continue a process, safeguarding creditor interests, whereby exploring possibilities for the Company, which could also be in the shareholders’ interests.
On 17 July 2019, the Company announced that it had received commitments in a contemplated private placement towards certain existing shareholders and new investors. The aggregate subscription amount committed was NOK 8.6 million. The private placement is subject to approval from a shareholder meeting in the Company to take place on 4 September 2019.
- Strategic initiatives and growth opportunities
The Company worked with various strategic alternatives, including a possible business combination with Tactilis Pte Ltd, Energos Group and Ayfie Group respectively. As announced by the Company, these initiatives were terminated due to the financial situation in the Company.
The private placement to be approved by the shareholder meeting on 4 September 2019, has secured the Company with sufficient funds to cover all outstanding debt as well as working capital to pursue new strategic opportunities to add new business to the Group and with the possibility to create interesting opportunities for growth and value creation going forward.
For further information, please contact:
Jørgen Waaler (CEO), telephone: +47 605 90 010 /e-mail: email@example.com