[UK] Sondrel Holdings shares fall after failure to make December payroll

On December 28, Reading-based semiconductor design services provider Sondrel Holdings PLC announced that it had been unable to meet its December payroll due to a delay in payment from an automotive manufacturer, London South East reports.

Shares in the UK group subsequently saw a steep drop of 32 per cent, falling to £5.50 by that afternoon.

Sondrel reportedly expected a payment of £1.7 million from an unnamed "Tier 1 automotive original equipment manufacturer" in December. The payment was related to a contract for application-specific integrated circuits.

However, Sondrel stated that an unexpected delay has pushed this payment back to between January and February 2024. This will delay the automotive contract until late in the first quarter of 2024 and require additional resources to complete, according to the group.

Sondrel is currently discussing funding for this with the customer.

A statement from the group said, "As a consequence of the above delay, the cash position of the group has further declined during December 2023. The company has been unable to meet December 2023 payroll in full and therefore the company's directors and senior management have agreed to defer their salaries and fees until such time as the delayed funds are received."

Graham Curren - Sondrel CEO - said, "Whilst it is disappointing to see last-minute hurdles introduced into the automotive project, it is encouraging that Sondrel's employees, suppliers and customers have continued to support the business during this difficult period.

"We remain encouraged by the positive development of key opportunities over Q4 2023 and we look forward to providing further updates on new ASIC business opportunities at advanced stages of negotiation in due course."

Source: London South East

(Quotes via original reporting)

On December 28, Reading-based semiconductor design services provider Sondrel Holdings PLC announced that it had been unable to meet its December payroll due to a delay in payment from an automotive manufacturer, London South East reports.

Shares in the UK group subsequently saw a steep drop of 32 per cent, falling to £5.50 by that afternoon.

Sondrel reportedly expected a payment of £1.7 million from an unnamed "Tier 1 automotive original equipment manufacturer" in December. The payment was related to a contract for application-specific integrated circuits.

However, Sondrel stated that an unexpected delay has pushed this payment back to between January and February 2024. This will delay the automotive contract until late in the first quarter of 2024 and require additional resources to complete, according to the group.

Sondrel is currently discussing funding for this with the customer.

A statement from the group said, "As a consequence of the above delay, the cash position of the group has further declined during December 2023. The company has been unable to meet December 2023 payroll in full and therefore the company's directors and senior management have agreed to defer their salaries and fees until such time as the delayed funds are received."

Graham Curren - Sondrel CEO - said, "Whilst it is disappointing to see last-minute hurdles introduced into the automotive project, it is encouraging that Sondrel's employees, suppliers and customers have continued to support the business during this difficult period.

"We remain encouraged by the positive development of key opportunities over Q4 2023 and we look forward to providing further updates on new ASIC business opportunities at advanced stages of negotiation in due course."

Source: London South East

(Quotes via original reporting)