LONDON (Alliance News) - Pinewood Group PLC shares rose on Wednesday after it increased its expectations for its full year results and said it has launched a strategic review of the business which could lead to the sale of the film studio operater.
Pinewood shares were trading up 16% to 522.85 pence per share on Wednesday morning, one of the biggest gainers on the London market.
Pinewood, in whose studios west of London many 'Star Wars' and James Bond films have been made, said it has appointed Rothschild to assist with the strategic review which could lead to the sale of the company.
Pinewood conducted a placing last year that raised GBP30.0 million to part fund phase one of the Pinewood Studios development framework expansion, which will add five new large sound stages and additional facilities totalling 300,000 square feet.
That placing was also conducted to create a more diversified shareholder base to support the company's longer-term growth and to assist AIM-listed Pinewood with obtaining a Main Market listing on the London Stock Exchange.
However, Pinewood said the shareholder register "remains tightly held" which has continued to "stifle liquidity in the shares" and prevented the company from achieving its aim of obtaining a Main Market listing.
"The board has now determined that it is appropriate to evaluate alternative opportunities to maximise value for the company's shareholders and to build on Pinewood's successes to date," it said.
"We believe there is a requirement for a funding strategy to be in place to fully realise the company's future potential (for instance to fund PSDF phases two and three). Accordingly, Rothschild has been appointed to assist with a strategic review of the overall capital base and structure, which could include a sale of the company," Pinewood added.
Chief Executive Ivan Dunleavy added: "We believe Pinewood has the potential to build on the strong performance of the last few years to grow further both in the UK and internationally. The board is now looking to identify the best ways to create the appropriate capital structure to allow the company to realise its goals in the best interests of shareholders."
Pinewood also Wednesday said its full year expectations are now higher than they were at the end of the first half, stating film revenues have benefited from "robust growth" in ancillary sales since the start of 2016 and said it continues to operate at high stage utilisation levels.
Pinewood said television revenue has performed well so far in the second half of the financial year, which is due to end in March, with revenue from the media hub division also performing strongly. Media investment revenue has also grown in the second half of the financial year, as expected, the company said.
"Accordingly, management's current expectations of performance for the financial year ending March 31, 2016 are now higher than at the time of the interim results last December," said Pinewood.
"As we come close to the end of the financial year, the benefits of our long term strategy for the business are again being realised. The company continues to experience strong demand for its facilities and services as we look forward to the new financial year," added Dunleavy.
By Joshua Warner; joshuawarner@alliancenews.com; @JoshAlliance
Copyright 2016 Alliance News Limited. All Rights Reserved.
