Member Article

Lloyds provides new banking facilities to Johnson Service Group

Johnson Service Group plc, the textile rental and dry cleaning specialist, has agreed a new £70m funding package with its current banking syndicate to provide additional working capital, and support for its acquisition plans.

Lloyds Bank’s North West-based Mid Markets and Strategic Finance teams led the banking syndicate, which also included The Royal Bank of Scotland and Santander.

Johnson has its headquarters in Preston Brook in Cheshire. It has refinanced its existing borrowings and increased its revolving credit facility from £50m to £70m, as it pursues its acquisition strategy in the textile rental market. The business can also draw on an uncommitted accordion facility if required.

Lloyds Bank’s North West-based Mid Markets and Strategic Finance teams led the banking syndicate, which also included The Royal Bank of Scotland and Santander.

The AIM-listed group comprises two business divisions; Textile Rental and Dry Cleaning. The rental division provides workwear, protective wear and hygiene services to more than 40,000 businesses and premium linen services to the hospitality, catering and leisure services. The group’s dry cleaning division operates the UK’s largest retail chain of dry cleaning outlets under the Johnson Cleaners brand.

As part of a plan to concentrate on its core textile services business, the group disposed of its facilities management division in August 2013. The group’s latest set of financial results show an 11% increase in adjusted operating profit at £17.0m for the twelve months to December 2013.

Yvonne Monaghan, Johnson Service Group’s Chief Financial Officer, said: “This new banking facility strengthens our financial position and provides us with the headroom to explore acquisition opportunities in the textile rentals market. We are focussed on identifying businesses that will enhance the range of services we can provide to customers and deliver extra value for shareholders.”

Paul Stanley, Relationship Director at Lloyds Bank Commercial Banking in the North West, said: “The Group has made good progress with its plan to refocus the business on its core textile services division.

“This is an area where it has historically been strong and one that offers attractive growth opportunities both organically and through bolt on acquisitions. We have worked with the Group for more than a decade and look forward to supporting its next phase of growth.”

This was posted in Bdaily's Members' News section by Simon Malia .