27 Mar 2020 11:08
HWSI Realisation Fund Limited (the "Company")
Net Asset Value as at 29 February 2020 and Covid-19 Update
The Company announces that the unaudited cum-income net asset value per Ordinary Share as at 29 February 2020 was 80.76 pence.
Shareholders should note, as described below, that whilst the Board, the Investment Manager and the Investment Adviser do consider that Covid-19 is likely to have a detrimental effect on portfolio investments, the position as at 29 February was at a much earlier stage than the one that now prevails. The situation is fluid and it is the Investment Adviser's and the board's view that it is not possible to quantify the impact of Covid-19 on the portfolio at this time. The Company will keep investors updated on any material developments within the portfolio. Accordingly no specific provisions have been made in the 29 February NAV as a result of Covid-19.
Covid-19 Update
Over the last six weeks, the market has seen a rapid reversal of consumer sentiment as Covid-19 has continued to spread globally. While the market has reacted sharply and governments have worked to contain the spread, the economic effects in the coming months are highly uncertain.
In line with the latest official guidance, Hadrian's Wall Capital Limited, the Company's investment adviser (the "Investment Adviser"), has taken the steps necessary to implement its Business Continuity Plan with its staff now working remotely from home, ensuring continuity of service and support to borrowers during this difficult time. The board is satisfied that the Company's other service providers are similarly able to support the continued operation of the Company. The Investment Adviser is closely monitoring official governmental guidance on the impact of Covid-19.
The Investment Adviser is reaching out to the Company's borrowers to assess:
1. Whether:
a. They have experienced any actual disruption as a consequence of employee absence or a supplier's ability to deliver products or services;
What contingency plans they have to manage or avoid business disruption due to Covid-19; and
2. In relation to the borrowers' own customers/clients:
a. Have they experienced any actual loss of trade or cash losses arising from a customer's/client's distressed state due to Covid-19?; and
b. Can they foresee any loss of trade or cash losses arising from a customer's/client's distressed state due to Covid-19?
Whilst these replies and other matters will be continuously monitored, it's clear that most borrowers have business continuity plans in action and have largely enabled home working (where possible), but some of their underlying customers or clients are experiencing or expected to experience slowdowns or disruptions to their business and some of the originated specialty finance platforms may receive higher than usual requests for forbearances.
In the case of the engineering company that is in the process of undertaking an equity raise, travel bans and market uncertainty are disrupting the capital raising process but the Investment Adviser believes this will result in delay rather than the inability eventually to conclude such capital raising.
LEI: 213800ABN7VKMVNOLG14
Note:
The Net Asset Value continues to be reported on an effective interest rate ("EIR") basis excluding certain adjustments which principally relate to upfront fees received. EIR reconciliations are provided in the Company's year end and interim financial statements.
Terms used in this announcement shall, unless the context otherwise requires, bear the meanings given to them in the prospectus published by the Company on 2 May 2017.
Contact Details:
Hadrian's Wall Capital (Investment Adviser)
Ron Miao / Mike Schozer
Telephone 020 3026 8620
International Fund Management (Investment Manager)
Chris Hickling
Telephone: 01481 737600
Praxis Fund Services Limited (Administrator)
Ben Le Prevost
Telephone: 01481 755524
Winterflood Investment Trusts (Corporate Broker)
Joe Winkley / Neil Morgan
Telephone: 020 3100 0000