Raketech cuts expenses after clearing debt
Online affiliate and content marketing business Raketech has repaid its entire corporate debt of €7.7m (£6.6m/$8.7m), cutting its quarterly financial expenses in the process.
Raketech has said the move represents the final step in optimising its capital structure post-IPO, with the cleared debt in relation to a previous loan facility.
The company said paying off its debt will save around €200,000 per quarter in financial expenses.
Since its IPO in 2018, Raketech said its focus has been on its capital structure by settling the existing loan and securing more favourable bank financing.
As part of this strategy, Raketech in December entered into an agreement with Swedbank for a revolving credit facility of €10m.
“To have successfully cleared our former loan facility is a milestone for Raketech’s finance strategy,” Raketech’s chief financial officer, Andreas Kovacs, said.
“We now have optimal conditions to carry out additional acquisitions, with lower financial expenses over time.”
The news will come as a boost to Raketech, which last month reported a decline in profit for 2018. Profit slipped from €5.8m in 2017 to €4.6m and profit before tax also fell from €6.1m to €4.8m, but operating profit was up from €8.8m to €11.2m.
Raketech was impacted by higher operating expenses during the year, with this total up from €8.3m to €14.4m, mainly due to increased spend on external SEO, hosting, development and domain expenses.
However, by clearing the debt and saving itself around €200,000 each quarter, this will help to lower expenses moving forward into 2019.