Braemar Shipping Regulatory News (BMS)

THE INFORMATION CONTAINED WITHIN THIS ANNOUNCEMENT IS DEEMED TO CONSTITUTE INSIDE INFORMATION AS STIPULATED UNDER THE MARKET ABUSE REGULATION (EU NO. 596/2014) WHICH IS PART OF UK LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018. UPON THE PUBLICATION OF THIS ANNOUNCEMENT, THIS INSIDE INFORMATION IS NOW CONSIDERED TO BE IN THE PUBLIC DOMAIN

14 February 2023

BRAEMAR PLC

("Braemar" or the "Company" or the "Group")

Trading update

Capital reduction to increase capacity to pay future dividends

Braemar Plc (LSE: BMS), a provider of expert investment, chartering, and risk management advice to the shipping and energy markets, today announces an update on trading for the year ending 28 February 2023, together with an intention to convene a General Meeting ("GM") in order to propose a capital reduction process. The latter process is designed to increase the Group's distributable reserves, increase the Group's capacity to pay future dividends and provide sufficient distributable reserves to cover all historic dividends paid.

Trading Update

The board of Braemar is pleased to report that the Group has continued to trade well since the release of its interim results in November 2022. The integration of the Group's newly acquired Spanish and US businesses announced in December 2022 has progressed well and both businesses are set to make an immediate and strong contribution to the Group's trading in the next financial year.

The board looks forward with confidence to providing a more detailed update on trading for the year ending 28 February 2023 and on expectations for the year to February 2024 in a pre-close update to be announced in mid-March 2023.

Capital Reduction

As at the date of this announcement, Braemar has issued 32,919,252 Ordinary Shares. The Company has an amount standing to the credit of the share premium account of £53,672,079 and an amount of £23,366,000 in its merger reserve account. Both of these accounts are non-distributable reserves and the Company is unable to use these to, amongst other things, make distributions to shareholders.

The Companies Act 2006 permits the Company (subject to the approval of shareholders and the consent of the Court) to cancel or reduce its share premium and certain other reserve accounts and credit the resulting sum (less an amount equal to certain of the Company's liabilities as at that date) to enhance the Company's distributable reserves. By increasing its distributable reserves in this way, the Company increases its capacity and flexibility to pay dividends.

Recognising the importance of dividends to shareholders and reflecting the strong cash generation of the business, the board of Braemar intends to seek shareholder approval to reduce the amount standing to the credit of its share premium and capitalise and reduce the merger reserve by approximately £75 million and create distributable reserves to increase the Company's capacity and flexibility to pay future dividends.

The reduction of the share premium and capitalisation of the merger reserve and cancellation of the resultant share issue requires the passing of special resolutions at a GM and subsequent approval of the Court (the "Capital Reduction"). The Company intends to send a notice convening a GM in due course and will apply to the Court for approval of the Capital Reduction conditional upon, and subsequent to, the passing of the necessary shareholder resolutions at the GM. The Capital Reduction will not be effective until the order of the Court confirming the reduction has been registered with Companies House. The dates and times of the GM and Court hearings will be set out in the GM circular.

Deeds of Release and Related Party Transaction

The Company has become aware that some historic dividends: i) having been paid out of retained earnings which do not qualify as distributable reserves under the Companies Act 2006 (the "Act") and/or ii) as a result of an administrative oversight by not filing unaudited interim accounts at Companies House, as required by the Act, (both the "Relevant Distributions") have been declared and paid in infringement of the Act. Neither the amount, nor payment of the Relevant Distributions, nor the Company's prior audited accounts, are affected by this, nor is there any impact on the Company's financial position at any time and the Company's intention is that no party should be put in a worse position as a result of these issues. The Company therefore intends to rectify this situation at the same time as the Capital Reduction and include appropriate resolutions at the GM to address the matter.

A consequence of the Relevant Distributions is that the Company may have a claim against its past and present shareholders who received the Relevant Distributions, as well as a claim against all directors who approved the Relevant Distributions at the time. The Company has no intention to make such claims.

The Company will therefore enter into a deed of release in favour of all shareholders who have received the Relevant Distributions releasing them from any and all claims which the Company has or may have in respect of the payment of the Relevant Distributions (the "Shareholders' Deed of Release") and a deed of release in favour of all persons who were directors at the time of payment of the Relevant Distributions, by which the Company waives any rights to make claims against such directors in respect of the Relevant Distributions (the "Directors' Deed of Release" and together with the Shareholders' Deed of Release, the "Deeds of Release").

The Deeds of Release are intended to ensure that the Company will be unable to make any claims against its past and present shareholders who were recipients of the Relevant Distributions or against all persons who were directors at the time that the Relevant Distributions were made.

As the Company's directors (comprising current and former directors within the last twelve months, being James Gundy, Tris Simmonds, Nick Stone, Nigel Payne, Elizabeth Gooch, Joanne Lake, Stephen Kunzer and Lesley Watkins) are deemed to be related parties of the Company pursuant to LR 11.1.4 R, it is expected that the Company's entry into the Directors' Deed of Release for nil consideration in respect of the Relevant Distributions will constitute a related party transaction pursuant to LR 11.1.4 R.

Accordingly, subject to the approval of the FCA and in accordance with LR 11.1.7 R, it is expected that a circular will be posted to shareholders in due course, and that the Directors' Deed of Release will become effective subject to shareholders passing the necessary resolutions at the proposed GM. The Directors' Deed of Release will also be conditional on the Court approving the Capital Reduction.

The Company will make further announcements in respect of the related party transaction in due course, as appropriate.

ENDS

For further information, contact:

Notes to Editors:

About Braemar Plc

Braemar provides expert investment, chartering, and risk management advice that enable its clients to secure sustainable returns and mitigate risk in the volatile world of shipping and energy. Our experienced brokers work in tandem with specialist professionals to form teams tailored to our customers' needs, and provide an integrated service supported by a collaborative culture.

Braemar joined the Official List of the London Stock Exchange in November 1997 and trades under the symbol BMS.

For more information, including our investor presentation, visit www.Braemar.com and follow Braemar on LinkedIn.