REG - Palace Capital PLC - DISPOSALS AND CASH UPDATE

Palace CapitalAnnouncement

24/07/2024 07:00

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RNS Number : 5274X  Palace Capital PLC  24 July 2024

24 July 2024

Palace Capital plc

("Palace Capital" or the "Company")

DISPOSALS AND CASH UPDATE

Palace Capital (LSE: PCA) announces a disposals and cash update ahead of its
Annual General Meeting ("AGM") being held later today and following the
announcement of its FY24 preliminary results on 6 June 2024.

 

Disposals

·      The Company has unconditionally exchanged or completed on the
sale of two investment properties for £12.3 million which, after adjusting
for rent incentives and promoter costs, is 2.9% below the March 2024
valuation. The blended net running yield after deducting void costs is 1.7%.
The sales comprised:

o  Boulton House, Manchester for £8.8 million, completed 22 July 2024

o  Nicholson Gate, Fareham for £3.5 million, completion due mid January 2025

 

·      We announced in the FY24 preliminary results that we had
conditionally exchanged on a self-contained office unit at 3B St James' Gate,
Newcastle to an owner occupier for £0.7 million, 69% above the value as at 31
March 2024 and are under offer to sell Copperfields, Dartford. Both of these
sales are expected to complete in the next few weeks.

 

·      Sales activity at Hudson Quarter continues with three apartments
completed for £1.6 million and one exchanged for £0.4 million, leaving 13
units remaining. Upon completion the proceeds for the four apartments sold
will be 3.4% ahead of the March 2024 valuation.

 

·      As previously announced, an additional tender offer is likely to
take place later in the year as further property sales are completed. The
Company is also seeking authority at today's AGM to buy back up to 5.6m shares
which represents c.19.5% of the issued share capital following the tender
offer noted below.

 

Cash

·      On 13 June 2024, the Company announced a tender offer to purchase
up to 8,667,760 shares at a price of 250 pence per share for a maximum
aggregate cash consideration of up to £21.67 million. On 11 July 2024 it was
announced that the tender offer was oversubscribed and therefore the Company
would be returning the maximum amount of £21.67 million cash to those
shareholders who had tendered their shares. This represented approximately 23%
of the Company's then issued share capital.

 

·      Since the change in strategy was announced in July 2022, cash
returned to shareholders from the tender offer and the share buyback
programmes totals over £43.5 million.

 

·      The Company has been in a net cash position since April 2024 and
as at 22 July 2024, gross debt was £8.2 million and proforma cash assuming
all exchanged properties complete was £20.5 million, resulting in net cash of
£12.3 million. Subject to shareholder approval at today's AGM of the final
fourth quarter dividend of 3.75 pence per share, payable on 23 August 2024,
proforma net cash is £11.2 million.

Commenting on today's update, Steven Owen, Executive Chairman said:

"Since the announcement of our annual results in June, we have continued to
progress our disposal and return of capital strategy and have recently
delivered a successful tender offer to support this process. Since July 2022,
we have returned over £43 million of cash to shareholders and expect to
announce a second tender offer later in the year.

"At an operational level, the Company continues to make good progress with its
asset management activities and will report further on these in due course.

"Given its strong cash position, the Company remains well placed in terms of
flexibility and optionality regarding the timing of its disposal programme and
other strategic initiatives."

 

Palace Capital plc
Steven Owen, Executive Chairman
info@palacecapitalplc.com (mailto:info@palacecapitalplc.com)

Financial PR
FTI Consulting

Dido Laurimore / Giles Barrie

Tel: +44 (0)20 3727 1000
palacecapital@fticonsulting.com (mailto:palacecapital@fticonsulting.com)

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