Ediston Property Investment Company plc

(LEI: 213800JRL87EGX9TUI28)

Net Asset Value ('NAV') as at 30 September 2023

Dividend and Company Update

Ediston Property Investment Company plc (LSE: EPIC) (the 'Company') announces its unaudited NAV as at 30 September 2023, the declaration of an interim dividend and an update following finalisation of the disposal of the Company's property portfolio.

NAV per Share as at 30 September 2023

The unaudited NAV of the Company at 30 September 2023 was £150.83 million, or 71.37 pence per share (30 June 2023 - 80.77 pence per share).

The NAV attributable to the ordinary shares has been calculated under International Financial Reporting Standards ('IFRS'). It does not include a provision for any accrued monthly dividend.

The figures in respect of the disposal of the portfolio (the 'Disposal') to RI UK 1 Limited, a wholly owned subsidiary of Realty Income, reflect the agreed headline price of £200.8 million prior to agreed and customary deductions, in addition to the crystallisation of lease incentives. Disposal transaction costs are presented separately in the above table and are distinct from the £0.39 million of Strategic Review costs recognised within the June 2023 NAV.

The table presents the movement from the prior NAV as at the quarter end of 30 June 2023. By way of further information, the Company's independent valuer, Knight Frank, completed an additional valuation of the property portfolio in connection with the disposal transaction as at 15 August 2023. At that date, the portfolio was valued at £207.25 million, a decline of £1.17 million from the 30 June 2023 valuation.

With the Disposal in the process of being finalised, the Company has been holding the cash proceeds therefrom, together with its existing cash reserves, in interest bearing current accounts, save for a small amount which has been held in a current account for operating expenses. £113 million of cash has been held in a blocked account as security for the debt facilities that were successfully novated to the Company from the Company's subsidiaries immediately prior to completion of the Disposal. The interest earned from funds in the blocked account has exceeded the cost of servicing the debt facilities by approximately 2.35 per cent. on an annualised basis. Cumulatively this will enable the Company to generate income, net of interest costs, of approximately £660,000 over the period from the end of September to liquidation (assuming repayment of the debt in early January 2024 prior to liquidation of the Company shortly thereafter) in relation to the principal loan balance of £111.1 million.

Declaration of Interim Dividend

Although the company is no longer a REIT and does not hold any real estate assets, it is obligated to make a property income distribution in respect of income collected during earlier periods. The Company therefore declares its interim dividend payment in respect of the period from 1 to 30 November 2023 of 0.4167 pence per share (0.3329 pence of which constitutes a property income distribution, thereby extinguishing the remaining PID reserve), as timetabled below:

This monthly dividend of 0.4167 pence per share equates to an annualised dividend level of 5.00 pence per share and is unchanged from the previous dividend declared on 1 November 2023.

With approval expected to be sought from Shareholders in January 2024 for the voluntary liquidation of the Company (as to which see further below), it is not anticipated that the Company will declare any further dividends. The four PID/dividend distributions made by the Company to its shareholders over the period from completion of the sale of the property portfolio to liquidation of the Company are therefore expected to total 1.67 pence per Share in aggregate.

Company Update

The completion accounts in connection with the Disposal have been finalised this week in accordance with the timetable set out in the sale agreement. Accordingly, the Board is now in a position to take the necessary steps to seek Shareholder approval for the voluntary liquidation of the Company, as previously advised. A circular will shortly be sent to shareholders convening a general meeting of the Company at which the requisite resolution will be put forward to allow liquidation to take place. The resolution will be proposed as a special resolution, meaning it will require a majority of at least 75 per cent of votes cast to be in favour in order for it be passed. 

The circular will contain full details of the liquidation proposal, including the anticipated quantum of the distribution(s) to be made to Shareholders pursuant to the liquidation. By way of initial guidance, and working on the assumption that the Company enters into liquidation on 11 January 2024, it is currently estimated that the NAV per Share as at liquidation will be no less than 70.21 pence, with such figure to increase by an additional 0.17 pence per Share provided the appropriate tax clearances are received as expected from HMRC in due course. When aggregated with the four PID/dividend distributions totalling 1.67 pence per Share paid or to be paid by the Company on or after 29 September 2023, Shareholders will thus have received back a minimum of 71.88 pence per Share in total, materially in line with the estimation made at the time of the Disposal in September.

Shareholders will receive an initial distribution of no less than 69.0p per Share, with the balance to be retained by the Liquidators to meet current, future and contingent liabilities of the Company, including any outstanding costs and expenses of the liquidation itself and potential tax liabilities. Once the Liquidators have satisfied all the claims of creditors of the Company and paid the costs and expenses of the liquidation and obtained tax clearance for pre- and post-liquidation periods from HMRC, it is expected the Liquidators will make a final distribution to Shareholders of any residual cash. The final distribution, if any, will be at a time to be determined solely by the Liquidators, but would be expected in the region of six to nine months.

A further announcement will be made by the Company upon publication of the circular, which is expected to be on or around 20 December 2023, with the general meeting expected to be held on 11 January 2024.

Following the change in the Company's accounting reference date to 31 March 2024 the unaudited Interim Report and Accounts to 30 September 2023 will be published prior to 31 December 2023.

Enquiries

David Yovichic    - Investec Bank plc                                                                                        0207 597 6000

Calum Bruce       - Ediston Investment Services Limited                                                   0131 225 5599

Susan Fadil          - JTC                                                                                                                      0203 893 1011

Ben Robinson    - Kaso Legg Communications                                                                     0203 995 6672

Stephanie Ross - Kaso Legg Communications                                                                     0203 995 6676

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014. Upon the publication of this announcement via Regulatory Information Service, this inside information is now considered to be in the public domain.