Zortrax Applies for Restructuring Agreement Approval
Zortrax’s largest contractors, whose claims are subject to restructuring proceedings, have opted for the adoption of restructuring proposals. Zortrax’s restructuring plan assumes the conversion of liabilities to the largest partners into the company’s shares, full repayment of the principal amount of liabilities worth less than PLN 130,000 and public law liabilities.
On 8 August 2024, an application for approval of the restructuring arrangement (partial arrangement) registered with the District Court in Olsztyn was filed. This is a consequence of the voting on the arrangement proposals presented by the arrangement supervisor, Mr. Paweł Głodek, developed in cooperation with the management board of Zortrax S.A.
– The arrangement proposals have been developed on the basis of an analysis of Zortrax’s capabilities in the implementation of the restructuring plan and taking into account the interest of the Company’s contractors. The fact that the creditors representing the vast majority of liabilities covered by the arrangement voted for the adoption of the plan confirms that we have worked out a real compromise – comments Paweł Głodek, arrangement supervisor and licensed restructuring advisor.
The Company’s public-law creditor (ZUS) was classified as group 1. The proposal for this group assumes full repayment of liabilities spread over 24 installments. ZUS has voted in favor of the restructuring agreement.
The second group includes Zortrax contractors whose claims do not exceed PLN 130,000. The arrangement proposals assume the full repayment of the principal amount of Zortrax’s liabilities to these contractors in 36 installments.
Zortrax’s contractors with claims to the company worth more than PLN 130,000 have been classified as group three. The total value of liabilities in this group amounted to approx. PLN 6.6 million. According to the prepared restructuring plan, these liabilities will be converted into shares of Zortrax S.A. The issue price of the new shares will be PLN 0.10 (10 groszy per share).
– A difficult period is behind us, which led us to the moment when it was necessary to take painful, but necessary actions. The restructuring plan prepared with support of the Resist Law Firm allows Zortrax to get out of a difficult situation. I am pleased with the positive reception of the proposal by our contractors. In my opinion, this is an expression of faith in the future of the company and confidence in our ability to go through with implementing the plan. Thank you for your trust and support – comments Mariusz Babula, CEO of Zortrax S.A.
The company – together with the restructuring advisor – intends to continue the process of comprehensive restructuring of its enterprise, which includes both the revenue and cost side. Only such an approach will allow for an increase in turnover and maximization of profits at a level that will enable the settlement of the Company’s debt on the terms provided for in the arrangement. The prepared restructuring plan assumes the application of such restructuring measures as: outsourcing of processes, reduction of real estate rental costs, restructuring of the financing structure and reduction of debt, or increasing the share of direct sales in the revenue structure. Some of the planned activities have already been implemented, and their full effects will be visible in the second half of the year.
– The profound changes that the company has undergone will result in a reduction in real estate rental costs by nearly 80% compared to the level at the beginning of 2023, wage and social security costs by approx. 70% and external services costs by nearly 50%. At the same time, Zortrax maintains the ability to develop software, develop new hardware, provide machines, parts, and materials for 3D printing, and provide technical support to existing and new customers – says Mariusz Babula, CEO of Zortrax S.A.
3D Printing Market
According to the CONTEXT report, in 2023, the global 3D printing market has seen problems in many segments, mainly due to inflation and high interest rates. However, this trend mainly affects expensive industrial-grade printers. On the other hand, desktop-class 3D printers (i.e. those produced by ZORTRAX) enjoyed growing interest and increased demand. CONTEXT predicts that after a difficult 2023, the 3D printing market will accelerate in the coming years. Manufacturers will increasingly use the power of 3D printing to produce personalized products at scale, taking into account individual customer preferences. This trend is expected to revolutionize the industry, offering businesses a competitive advantage in providing tailor-made solutions.
– Zortrax’s strength is its extensive sales network, which currently includes over 190 partners in almost 60 countries around the world. Despite the recent turbulence, we are seeing continued demand for 3D printers, consumables and printing materials. Thanks to this and the ongoing restructuring process, we can focus on our current business and provide customers with the products they need more and more smoothly. Stabilization of Zortrax’s situation will therefore be the foundation for the Company’s growth. I believe that we will benefit from the anticipated dynamic growth of the 3D printing industry – says Natalia Jusiak, Sales and Marketing Director at Zortrax S.A.