REG - Dolphin Capital Inv - Q1 2014 NAV and trading update <Origin Href="QuoteRef">DOLC.L</Origin>

DCI AdvisorsAnnouncement

06/09/2014 02:10

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RNS Number : 3158J
Dolphin Capital Investors Limited
11 June 2014 
 
11 June 2014 
 
DOLPHIN CAPITAL INVESTORS LIMITED 
 
("DCI" or "Dolphin" or the "Company" 
 
and together with its subsidiaries the "Group") 
 
Q1 2014 NAV Announcement and Trading Update 
 
Dolphin, a leading global investor in the residential resort sector in
emerging markets and one of the largest real estate companies on AIM in terms
of net assets, is pleased to provide an update on operational progress and
announce its unaudited Net Asset Value ("NAV") as at 31 March 2014. 
 
A.  Financial highlights: 
 
·   Total Group NAV as at 31 March 2014 was E648 million and E561 million
before and after Deferred Income Tax Liabilities ("DITL") respectively. This
represents an increase of E44 million (7.3%) and E36 million (7%),
respectively, from 31 December 2013. 
 
·   This NAV uplift is mainly attributable to DCI's share of the increase in
the Venus Rock valuation, in accordance with the latest independent valuation,
following the termination of the sale contract with China Glory Investment
Group ("CGIG") in order to facilitate other current sale discussions, as
outlined in more detail below (section B.2.). 
 
·   Sterling NAV per share as at 31 March 2014 was 83p before DITL and 72p
after DITL. This represents an increase of 6.2% and 5.9% compared to the 31
December 2013 figures. 
 
·    The Company continues to have a strong asset base coupled with low
leverage: 
 
-   Gross Assets of E913 million. 
 
-   Total Debt of E172 million with a Group total debt to total assets value
ratio of only 19%. 
 
-   E50 million and US$9.17 million of convertible bonds are held at the
Company level. The Company has provided corporate guarantees for the US$31
million outstanding Playa Grande Convertible Bonds, and the US$19 million
Playa Grande construction loan. 
 
B. Transaction Highlights since last Trading Update of 26 March 2014: 
 
B.1.   Update on the preferred equity investment by Colony Capital 
 
·   As announced on 25 March 2014, Dolphin signed a non-binding agreement with
Colony Capital, acting on behalf of managed and advised funds ("Colony"), for
the proposed issue of two tranches of E50 million preferred equity instrument
in Dolphin Capital Greek Collection ("DCGC"), a newly incorporated 100% owned
Dolphin holding company. It was envisaged that this would own Dolphin's
shareholding interests in Amanzoe, The Chedi and the Jack Nicklaus Signature
Golf Course, The Nikki Beach Resort & Spa at Porto Heli and the Aman at Kea. 
 
-   Since the signing of this preliminary agreement, Colony has been
performing legal, financial and technical due diligence on the above projects,
and the parties have been working to finalise the overall terms of the
potential transaction. Based on the Company's discussions with Colony, taking
into consideration feedback from Dolphin's major shareholders and the improved
environment in the availability of financing, the size of the tranches is
expected to be reduced and they will be decoupled. The Company is likely to
commit only to the first tranche, which should be secured solely against the
Amanzoe project. At the same time, the revised overall economic terms of the
proposed transaction (such as the annual interest rate, the split of the
project cash flows and the amount of warrants to acquire DCI common shares)
are expected to be significantly improved in favour of the Company. In
addition, it is expected that the preferred equity instrument will not include
conversion rights to DCI common shares. 
 
-   The Company remains in close cooperation with Colony in order to finalize
the definitive documentation for the completion of the transaction which is
expected to be signed around 30 June 2014, and which remains subject to the
completion of due diligence, agreement of definitive documentation and certain
other pre-conditions. The Company will inform Shareholders on the final
detailed terms and conditions of the transaction upon signing of the binding
agreement with Colony. 
 
·   In light of the ongoing progress made in its discussions with Colony, the
Company has not proceeded with the Profit Sharing Agreement for 50% of the
Amanzoe Villas future sales which was entered into on 28 January 2014 with
Archimedia Holdings Corp. ("Archimedia"), as disclosed in the Company's 2013
preliminary results announcement. 
 
B.2.     Termination of agreement with CGIG for sale of Venus Rock to continue
discussions with other interested parties 
 
·   On 17 May 2013, shortly after the March Cypriot economic collapse, Aristo
Developers Ltd ("Aristo", the Company's 49.8% affiliate) entered into a
binding agreement with CGIG for the sale of the Venus Rock project for a fixed
consideration of E241.5 million, plus E48.5 million in conditional deferred
consideration, plus interest for any payment delays (the "Venus Rock Disposal
Agreement"). 
 
·   Subsequent to the signing of the Venus Rock Disposal Agreement, CGIG has
not met the contractually agreed payment deadlines for the project
consideration under the Venus Rock Disposal Agreement, despite extensive
renegotiations with Aristo to amend certain payment terms. As a result, Aristo
sent a termination notice under the Venus Rock Disposal Agreement to CGIG
which became effective as of today. 
 
·   Aristo is contractually entitled to retain the deposit payments received
to date from CGIG, totalling E5 million, in the form of liquidated damages for
CGIG's breach of the Venus Rock Disposal Agreement, and has reserved its right
to pursue further legal action against CGIG. 
 
·   Aristo has already been approached by two other interested parties for the
absolute or partial sale of the Venus Rock project and is now advancing the
discussions with them. 
 
·   Most importantly, Aristo will now recommence the sale of Venus Rock plots
and homes, a major component of Aristo sales, which have been halted for the
past year due to the transaction with CGIG. 
 
B.3.     Sale of Port Kundu, Turkey 
 
·   On 26 April 2014, the Company received the balance of the E9.8 million
consideration for the sale of 100% of Pt. Kundu, following the signing of the
final binding agreement, on 12 March 2014. Approximately E1.5 million of this
was used to repay fully the existing debt on Pt. Kundu, resulting in a net
consideration of E8.3 million to DCI. 
 
B.4.     Dolphin Capital Americas ("DCA") 
 
·   As disclosed in the 2013 annual report, DCA signed a letter of intent to
acquire one of the largest privately owned islands in the Bahamas, comprising
320 hectares of land and situated less than 30 miles from Nassau and 150 miles
from the United States (the "Island"). DCA is advancing legal, technical and
financial due diligence on the Island to determine whether it should proceed
with the investment. 
 
C. Operating Highlights since the last Trading Update of 26 March 2014: 
 
C.1.     ADVANCED PROJECTS 
 
·   The Porto Heli Collection ("PHC" - www.portohelicollection.com), Greece 
 
Amanzoe (www.amanzoe.com) 
 
-   Amanzoe hotel reopened on 5 April 2014. As expected, operating performance
so far this year has been considerably improved, both in terms of occupancy
and rates, compared to its first full year of operations in 2013. 
 
-   The construction of the four new hotel beach pavilions adjacent to the
Amanzoe Beach Club with direct beach access has been completed. The pavilions
are expected to further enhance Amanzoe's luxury offering. 
 
-   Two new reservations have been agreed for Amanzoe Villas, bringing the
total number of villas sold or reserved to 12 with a total sales value of E74
million. 
 
-   One more Amanzoe Villa was added to Amanzoe's rental programme in June
2014, bringing the total to three, and one more will be added later in the
summer. Construction is progressing for three more Villas, which are due to
complete in 2015, and construction for two additional villas is expected to
begin before Q4 2014. 
 
-   Both the Amanzoe hotel and the Villas continue to receive extremely
positive reviews in the international media, such as the inclusion of Amanzoe
in the World's 100 Best Resorts by Robb Report (USA), and the Amanzoe Spa as
one of the Best Spas in the World by Conde Nast Traveller (UK). Amanzoe was
also named as the overall winner at the Greek Tourism Awards 2014, which were
awarded to tourism related industries acknowledging best practice in the
industry. 
 
The Nikki Beach Resort & Spa at Porto Heli (www.nikkibeachhotels.com) 
 
-   Construction is set to be completed in July 2014, in line with budget, and
soft opening is scheduled for 1 August 2014. 
 
·   Playa Grande Club & Reserve ("Playa Grande" - www.playagrande.com),
Dominican Republic 
 
-   The mock up pavilion of the Aman Hotel has been completed and it is
planned that it will be reviewed for approval by Aman Resorts on 16 June
2014. 
 
-   The construction of the Aman pavilions, main resort lobby and the service
buildings are advancing according to plan. 
 
-   The renovation of the remaining front nine holes of the Robert Trent Jones
Snr. Golf Course is expected to commence during the summer of 2014 so that the
completion of all 18 holes will coincide with commencement of operations of
the Aman Hotel. 
 
·   Pearl Island ("Pearl Island" - www.pearlisland.com), Panama 
 
-   The value engineering process has advanced to the stage of approving an
acceptable budget based on which the designs can be finalised, ahead of
construction of the planned Ritz Carlton Reserve hotel. Construction is
expected to begin in early 2015, subject to concluding ongoing discussions
with regional banks, aiming to increase the approved debt facility to over $30
million. 
 
-   The regional investor group that acquired the Founders' Phase is advancing
construction works and the first group of turn-key villas and condos is
scheduled to be delivered by the end of 2014. The sale of lots and turn-key
product continues in line with the strong demand for and limited supply of
luxury residential product in Panama. 
 
-   Dolphin remains in discussions with various strategic groups interested in
investing and participating in one of the many development phases of the
island, including the Ritz Carlton Reserve, the Marina and another luxury
resort phase. 
 
C.2.     MAJOR PROJECTS 
 
·   The Aman at Kea 
 
-   On 28 April 2014 the project received Greek National Tourism Organisation
Architectural approval for the construction of a 30-room Aman hotel and spa,
as well as 30 Aman villas spread over 32,213 buildable m2. Detailed designs
for submission of the construction permit will be prepared by Q4 of 2014. 
 
D. DCI Directorate change 
 
·   On 10 June 2014, Mr. David B. Heller was elected to be Chairman of the
Board of the Company. Mr. Heller has been a non-executive director of DCI
since 14 March 2013, having been nominated for appointment by Third Point
LLC. 
 
·   The previous Chairman, Mr. Andreas Papageorgiou, will continue to act as a
non-executive director. 
 
Miltos Kambourides, Managing Partner of Dolphin Capital Partners Limited,
commented: 
 
"The team is focused on improving current project sale and financing
transactions, while capitalizing on the improving market conditions to execute
more retail sales and new funding arrangements for accelerating the
development of its existing projects. 
 
"We would like to thank Mr. Andreas Papageorgiou for chairing the Company
since inception and we look forward to his continued counsel as a
non-executive director." 
 
Conference call for analysts and investors 
 
There will be a conference call at 09:00 (UK time) on Wednesday 11 June 2014,
which can be accessed by the following dial-in numbers: 
 
Dial in number (London): +44(0)20 3427 1912 
 
Dial in number (Greece): 00800 128 800 
 
Confirmation Code: 8827663 
 
For further information, please contact: 
 
 Dolphin Capital PartnersMiltos E. KambouridesPierre A. CharalambidesKaterina G. KatopisEleni Florou                              miltos@dolphincp.com pierre@dolphincp.comkaterina@dolphincp.com ef@dolphincp.com  
 Panmure Gordon(Joint Broker)                                                       Richard Gray / Dominic Morley / Andrew Potts  +44 (0) 20 7886 2500                                                              
 Edmond de Rothschild Securities(Joint Broker)William Marle John Denby                                                            +44 (0) 20 7845 5900w.marle@lcfr.co.ukj.denby@lcfr.co.uk                          
 Grant Thornton UK LLP (Nominated Adviser)Philip Secrett                                                                          +44 (0) 20 7383 5100                                                              
 FTI Consulting, LondonStephanie HighettWill HendersonNick Taylor                                                                 +44 (0)20 3727 1000dolphincapital@fticonsulting.com                               
 
 
Notes to Editors 
 
Dolphin (www.dolphinci.com) is a leading global investor in the residential
resort sector in emerging markets and one of the largest real estate
investment companies quoted on AIM in terms of net assets. Dolphin seeks to
generate strong capital growth for its shareholders by acquiring large
seafront sites of striking natural beauty in the eastern Mediterranean,
Caribbean and Latin America and developing sophisticated leisure-integrated
residential resorts. 
 
Since its inception in 2005, Dolphin has become one of the largest private
seafront landowners in Greece and Cyprus and has partnered with some of the
world's most recognised architects, golf course designers and hotel
operators. 
 
Dolphin's portfolio is currently spread over approximately 63 million m2 of
prime coastal developable land and comprises 14 large-scale,
leisure-integrated residential resorts under development in Greece, Cyprus,
Croatia, Turkey, the Dominican Republic and Panama and a 49.8% strategic
shareholding in Aristo Developers Ltd, the largest developer and private land
owner in Cyprus. 
 
Dolphin is managed by Dolphin Capital Partners, an independent real estate
private equity firm. 
 
- ENDS - 
 
This information is provided by RNS
The company news service from the London Stock Exchange