Dillistone Group warns of 'challenging' market environment, raises £300k

Recruitment software supplier Dillistone Group warned on Friday that the market remained challenging and, if anything, had softened further in the second quarter and into Q3.

Dillistone said its interim results would likely be in line with expectations, marking a "significant improvement" in operational profitability when compared to H123. It also stated that it was operationally cash-generative in the six months ended 30 June.

The AIM-listed company also revealed it had agreed to raise up £300,000 through the issue of convertible loan notes and £60,000 through the issue of new ordinary shares, with Dillistone stating the fundraising was "a prudent course of action" in case markets remain challenging.

Chairman Giles Fearnley said: "In a challenging climate, we are pleased that we expect to report positive results in H1. This additional cash injection, supported by every current board member along with our former Chairman, Dr Mike Love, and a new, independent shareholder shows our confidence in the business. It provides working capital to support trading and will also facilitate the release of significant product updates that we expect to see later in the year."

As of 1035 BST, Dillistone shares had slumped 5.44% to 8.51p.

Reporting by Iain Gilbert at Sharecast.com