Total Client Services (TCS), which is in business rescue, aims to issue more shares for cash to aid it through its severe financial situation.
The listed company, which filed for business rescue last November, will update shareholders in due course, as soon as it has feedback from the JSE relating to its application to issue more shares.
TCS has not provided an offer price, and its stock has been suspended since 23 December, last trading at 1c, which gives the company a market capitalisation R3.9 million.
The company notes the JSE's listing requirements allow organisations that are in severe financial difficulty, that have no alternative but to issue shares for cash within a short time frame to meet ongoing working capital requirements or to reduce its liabilities, to be exempt from preparing a circular and obtaining shareholder approval to issue stocks.
As TCS is currently in severe financial difficulty and under business rescue, it has requested permission from the bourse to issues shares without needing shareholder approval. It says this is to raise capital as per its business rescue plan, adopted on 19 May and developed by business rescue practitioner Piers Marsden.
TCS has been battling financially for some time. In the year to February 2013, revenue dropped 9% and its loss widened 67%. For the six months to August, revenue slumped 40%, to R15 million.
Its net loss leapt to R8.2 million, from R3 million, while basic and headline loss per share also jumped. In the results commentary, it said its focus was to continue to "consolidate the existing contracts, improve the service offering and win new business".
Since the start of the 2013 financial year, it had been focused on trying to extract maximum value from its current contracts, and has developed solutions and entered into joint venture agreements with "reputable organisations" to grow its offering to new and existing clients, it has said.
"This will enable the group to penetrate into other markets and thus diversify from a risk point of view. The group is well positioned to deliver on this strategy."
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