Conviviality reveals unexpected £30 million tax bill
Bargain Booze owner Conviviality has revealed that it has to pay an unexpected £30 million tax bill which has led it to issue a second profit warning in the space of a week.
In a statement, the company said it discovered the payment due to HMRC on 13 March. With the sum falling due for payment on 29 March, Conviviality said it had not been accounted for in its short term cash flow projections. As a result, it now faces a “short-term funding requirement” and has suspended trading of its shares on AIM.
The company has now engaged PwC to assist it in its discussions with HMRC and “key stakeholders”. It said: “Following preliminary advice received from PwC, whilst there can be no guarantee, the board believes this short-term funding requirement will be satisfactorily resolved.”
In recent days, Conviviality had said that it expected its range of adjusted EBITDA for its full year to be 20% below market expectations. It now says EBITDA is likely to come in at between £55.3 million and £56.4 million.
