SomnoMed (ASX:SOM) shareholders have demonstrated their support...

SomnoMed (ASX:SOM) shareholders have demonstrated their support for the company and growing sales of its sleep apnea products by applying for $6.1 million worth of shares under its Share Purchase Plan, well above the maximum of $1.5 million available.

Proceeds from the SPP and earlier placement, which totals $7.05 million, will be used to double its production capacity and fund growing operations.

The company had received in excess of 500 valid applications for the SPP of 1 million shares, which was priced at $1.50 per share.

“We are very grateful for the overwhelming support and interest received from shareholders. Applications for the subscription of shares received were four times higher than the number of shares we could justify to issue,” executive chairman Dr Peter Neustadt said.

“As a result, we have raised $7 million in additional capital from the recent placement and SPP (of which $405,000 will be subscribed by Director related entities, subject to shareholder approval), which will allow us to continue with our process to build a successful, fast growing global medical device company.

“We are very appreciative of this tremendous sign of confidence in SomnoMed’s future and we are sorry to have caused disappointment to shareholders and stock brokers who were prepared to take up a much higher number of shares than those being issued to them.”

The company had recorded a 39.5% increase to its revenues for the 2014 financial year to $25.92 million from the previous year. This also marked its seventh straight year of growth.

EBITDA was up 26.5% to $1.05 million due to positive sales trends of its sleep apnea products in North America, Europe and APAC throughout the year.

It forecast a 25% increase in revenues to $32.5 million in FY2015 and EBITDA of $2 million to $4 million.

Shares in the company have risen 18.75% to an intra-day high of $1.90 today.  In early July when the share price was $1.56, Proactive Investors calculated and placed an initial share price target of $2.05 to $2.19 within 6-9 months.

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