KUALA LUMPUR (May 7): Home furniture maker Mobilia Holdings Bhd is planning to issue up to 218.75 million free warrants (Warrants-B), on the basis of one Warrant-B for every four existing shares held by entitled shareholders.

The warrants' indicative exercise price is 15 sen apiece, representing a 10% discount to Mobilia’s closing price of 16.5 sen on Tuesday. At 16.5 sen, Mobilia is valued at RM115.5 million.

Assuming the full exercise of the warrants, the group is expected to raise about RM32.81 million to fund its working capital requirements, its bourse filing showed.

As at April 30 — being the last practicable date before the latest announcement — the group's issued share capital stood at RM36.7 million, comprising 700 million shares, with no treasury shares.

On its prospects, Mobilia said it plans to expand its market reach by participating in international trade fairs, overseas sales visits and developing new products to attract and retain customers and thereby secure new sales orders.

“The group will emphasise continuous enhancement of operational efficiency to increase competitiveness among global furniture players. This includes implementing a transformation program focused on increasing production efficiency and enhancing product quality. Additionally, ongoing production automation efforts will further improve product precision.

“Considering the prevailing global economic uncertainties, the group is proactively planning and implementing measures to mitigate risks and challenges, while closely monitoring business performance,” it added.

The free warrants are expected to be issued by the third quarter of 2024. Hong Leong Investment Bank Bhd has been appointed the principal adviser for the exercise.

The group reported a net profit of RM8.23 million for its financial year ended Dec 31, 2023, down from the RM11.76 million it made in FY2022, mainly due to trade exhibition expenses, allowance for impairment loss on trade receivables and an inventory loss due to a fire incident; revenue dipped to RM82.24 million from RM84.95 million.