DTEA - DavidsTea: The Restructuring Procedure Is About To Spit Out A Debt-Free Tea Merchant With Significant Profit Potential

• With Friday’s final approval of the proposed plan of arrangement by its creditors, DavidsTea completed its long-awaited last major milestone to exit the one-year lasting restructuring proceedings.
• Upon payment of the amicable settlement amount of C$18 million, all creditors' claims in connection with the restructuring proceedings, mainly contractual future lease obligations, are deemed to be settled.
• Market participants expected a settlement payment of at least three times this amount (with a current cash balance of C$30.2 million, the much-feared equity offering can be easily avoided).
• DavidsTea continues to make progress with the shift towards its e-commerce and wholesale channels growing by 130% y-o-y in 2020.
• Substantially leaner organization as a result of the transformation and restructuring process should target sales significantly north of C$100 million at an EBITDA margin of 10-15%.

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