Nexus helps drive 12.6% uplift in EPE Special Opportunities NAV

EPE Special Opportunities has published results for the year ended 31 January 2016. The Net Asset Value at 31 January 2016 was 160.00 pence per share, an increase of 12.6% on the NAV per share of 142.13 pence as at 31 January 2015. The share price at 31 January 2016 was 124.50 pence, representing an increase of 9.2% on the share price of 114.00 pence as at 31 January 2015.

The Chairman says  the year has proved encouraging for the Company’s largest asset, Nexus Industries (“Nexus”), which has continued its strong growth trajectory and outperformed budget, driven by increased international sales and continuing growth in sales of their LED lighting range. Whittard of Chelsea had a weak final quarter of 2015 with disappointing high street and web sales. However the business has invested in initiatives targeting substantial returns, including investment in the brand offering with the relaunch of their tea range in September 2015 and the launch of a new website during the same period.

On 24 July 2015, the Company bought out the minority interest held by DES Holdings (“ESD”) in ESO Investments 1 LP (“ESO 1 LP”), thereby securing 100% control of the overall structure. The consideration of EUR12.2 million, payable in euros, represented ESD’s audited NAV in ESO 1 LP as at 31 January 2015 at a fixed sterling to euro exchange rate of 1:1.35. After currency exchange gains, the Company paid GBP8.6 million for the minority interest, a 16.3% discount to the implied 31 January 2016 ESD holding value. The buyout will enhance the value generated by future growth of the Company’s core assets, Whittard and Nexus.

Concurrent with the acquisition of ESD’s interest in ESO 1 LP, the Company raised GBP4.5 million via a placing of a new unsecured loan note instrument (“ULNs”) and GBP0.25 million via the issue of new equity in the Company. The new ULNs are repayable on 23 July 2022, with the Company retaining the option to extend repayment by one year. The notes will pay an annual interest of 7.5%.

Since first issuance of the ULNs, the Company refinanced a total of GBP3.0 million in principal amount of the existing Convertible Loan Notes (“CLNs”) by the issue of new notes for the same principal amount under the new ULNs. In addition to the notes, CLN holders participating in the refinancing have received warrants over Ordinary shares on a 1 for 5 basis, exercisable upon payment in cash of 170 pence after 31 July 2018. Further, the Company has raised GBP0.5 million through the issuance of ULNs to new investors. At 31 January 2016 the Company had issued ULNs of GBP8.0 million in principal amount, which were admitted to trading on the ISDX Growth Market on 29 January 2016.

EPE : Nexus helps drive 12.6% uplift in EPE Special Opportunities NAV