LONDON (Alliance News) - Electra Private Equity PLC on Tuesday reported its net assets decreased in the financial year ended September 30 as the company manages its wind down but held onto its UK retail and casual dining assets due to a challenging year.
The investment trust's net asset value per share at September 30 stood at 527.0 pence with net assets of GBP201.7 million.
Electra Private Equity paid a GBP140 million special dividend, totalling 365p, in the period. Excluding disposals and special dividends made in the period, Electra Private Equity's NAV per share at September 30 was 892.0p.
The trust's opening NAV was 1,981p. The reduction to 892.0p was mainly attributed to the trust paying 939p in ordinary dividends during the period.
The trust decided given the "well documented challenges" in the UK retail and casual dining sectors, it was "not appropriate" to sell its two largest assets, restaurant chain TGI Fridays and retailer Hotter Shoes.
TGI Fridays and Hotter Shoes represents nearly 90% of Electra's remaining portfolio. At September 30, TGI Fridays made up GBP124.6 million of Electra's net assets, with Hotter Shoes totalling GBP6.8 million.
Electra is confident both assets can provide "strong exits in an acceptable timeframe". The trust said the performance and valuation of both TGI Fridays and Hotter Shoes were hurt by trading conditions affecting the wider UK consumer, retail and casual dining sectors.
Electra said: "This was compounded by extreme weather that impacted TGI over the specific periods involved and had a more profound effect on Hotter Shoes in disrupting the launch of the spring/summer season with a resultant impact on the promotional calendar of Hotter Shoes and its competitors, leading to lower margin sales throughout the summer."
The trust declared its first special dividend of financial 2019 of 365p, to be paid this Friday, and Electra said it intends to pay a further GBP10 million in dividends during the year.
"From a market capitalisation of GBP1.2 billion at the start of October 2015 we have now made and announced distributions to shareholders of over GBP2.0 billion with remaining net assets of GBP0.2 billion after announced distributions. The direction is now clear, and we will seek to optimise value in the remaining portfolio over an acceptable timeframe whilst managing our cost base accordingly," said Chairman Neil Johnson.
Shares in Electra Private Equity were down 1.5% Tuesday morning at 398.00 pence each.