TIDMECT
EUROCASTLE INVESTMENT LIMITED
Contact:
Oak Fund Services (Guernsey) Limited
Company Administrator
Attn: Hannah Crocker
Tel: +44 1481 723450
Eurocastle Releases First Half 2023 Financial Results
Guernsey, 10 August 2023 -- Eurocastle Investment Limited
(Euronext Amsterdam: ECT) today
https://www.globenewswire.com/Tracker?data=CloBEVfctSg-xKsTGDIvfD-Qozj5B-_lpXGpD6NvUJ8aygnQ0AnR1-aKeVpyHWr7
has released its interim management statement for the quarter ended
30 June 2023.
-- ADJUSTED NET ASSET VALUE ("NAV")1 of EUR10.2 million, or EUR10.25 per
share2, down EUR0.09 per share vs. Q1 2023 mainly due to minor valuation
adjustments to its liquidating real estate fund investments.
Q2 Cash
Q1 2023 Movement Q2 FV Movement Q2 2023 NAV
---------------- ------------ -------------- ----------------
EUR EUR EUR EUR
EUR'm p.s. EUR'm p.s. EUR'm p.s. EUR'm p.s.
Real Estate Funds 0.64 0.64 (0.5) (0.5) (0.06) (0.06) 0.08 0.08
Net Corporate
Cash(3) 16.71 16.79 0.5 0.5 (0.15) (0.21) 17.06 17.08
Legacy German Tax
Asset 4.82 4.84 - - - (0.01) 4.82 4.83
-------------------- ------- ------- ----- ----- ------ ------ ------- -------
IFRS NAV 22.17 22.27 - - (0.21) (0.28) 21.96 21.99
==================== ======= ======= ===== ===== ====== ====== ======= =======
Additional
Reserves(4) (11.88) (11.93) - - 0.15 0.19 (11.73) (11.74)
Adjusted NAV 10.29 10.34 - - (0.06) (0.09) 10.23 10.25
==================== ======= ======= ===== ===== ====== ====== ======= =======
Ordinary shares
outstanding 995,555 998,555
As at 30 June 2023, the Company's remaining assets comprise:
1. EUR17.1 million, or EUR17.08 per share, of net corporate cash3 which is
primarily available to commence seeking new investments under the New
Investment Strategy.
2. Residual interests in two legacy Italian Real Estate Fund Investments
with an NAV of EUR0.08 million, or EUR0.08 per share, where the
underlying apartments are now all sold with both funds currently in
liquidation.
BUSINESS HIGHLIGHTS
-- Real Estate Funds -- In April, Eurocastle received EUR0.5 million, or
EUR0.50 per share, mainly representing its share of the proceeds from the
sale of the last remaining apartment units. The remaining NAV for these
investments of EUR0.1 million, or EUR0.08 per share, reflects cash
currently reserved in the funds that is expected to be released once the
fund manager resolves certain potential liabilities and liquidates each
fund.
-- New Investment Strategy -- The Company has established its initial
investment structure and is in advanced discussions to acquire its first
real estate asset in Greece. Working with a local partner, the Manager
has identified a pipeline of investment opportunities in Greece arising
from judicial auctions and consensual sales through which it can
potentially acquire real estate assets that are currently collateral to
defaulted claims or owned by banks or investors as a consequence of a
repossession process.
-- Additional Reserves -- The Company reduced these reserves from EUR12.1
million to EUR11.7 million, or EUR11.74 per share, during the first half
of the year with the reduction of EUR0.4 million reflecting reserves
being utilised in line with anticipated costs. As at 30 June 2023, of the
total Additional Reserves of EUR11.7 million, EUR6.5 million related to
the legacy German tax matter with the balance of approximately EUR5.2
million in place to allow for future costs and potential liabilities
while the Company pursues in parallel the New Investment Strategy.
SUBSEQUENT EVENTS TO 30 JUNE 2023
The Legacy German Tax Matter
In July, the Company received revised tax assessments in
relation to the legacy German tax matter which resulted in a total
reimbursement to the Company of EUR1.1 million of the EUR4.8
million of additional tax paid by Eurocastle in 2022 and 2023. This
follows an appeal by the Company against the additional tax
assessed in relation to a property subsidiary for the period 2008
to 2012. The revised tax assessments represent a full reversal of
the additional tax for 2008 as well as a part of the amount for
2009. The Company is awaiting receipt of the final report from the
appeals office on the full period and until such time is unable to
assess the impact of these findings on the total amount reserved
for this matter. The Company intends to appeal any remaining tax
liability assessed on this matter through the German court
system.
Income Statement for the Six and Three Months ended 30 June 2023
(unaudited)
Income Income
Statement Statement
H1 2023 Q2 2023
EUR Thousands EUR Thousands
-------------------------------- ------------- -----------------------------
Portfolio Returns
--------------------------------
Italian NPLs & Other Loans
realised gain 2 -
Real Estate Funds unrealised
fair value movement (49) (64)
-------------------------------- ------------- -----------------------------
Fair value movement on Italian
investments (47) (64)
Other income 2 -
Interest income 210 119
Total income 165 55
-------------------------------- ------------- -----------------------------
Operating Expenses
--------------------------------
Manager base and incentive fees 52 22
Remaining operating expenses 526 246
-------------------------------- ------------- -----------------------------
Other operating expenses 578 268
-------------------------------- ------------- -----------------------------
Total expenses 578 268
-------------------------------- ------------- -----------------------------
(Loss) for the period (413) (213)
EUR per share (0.41) (0.21)
-------------------------------- ------------- -----------------------------
Balance Sheet and Adjusted NAV Reconciliation as at 30 June
2023
Italian
Investments Corporate Total
EUR Thousands EUR Thousands EUR Thousands
---------------------------
Assets
Other assets - 55 55
Legacy German tax asset - 4,818 4,818
Investments - Real Estate
Funds 81 - 81
Cash, cash equivalents and
treasury investments:
Cash and cash equivalents - 13,157 13,157
Treasury Investments - 4,211 4,211
Total assets 81 22,241 22,322
Liabilities
Trade and other payables - 338 338
Manager base and incentive
fees - 22 22
--------------------------- -------------- -------------- --------------
Total liabilities - 360 360
IFRS Net Asset Value 81 21,881 21,962
---------------------------- -------------- -------------- --------------
Liquidation cash reserve - (5,246) (5,246)
Legacy German tax cash
reserve - (1,665) (1,665)
Legacy German tax asset
reserve - (4,818) (4,818)
Adjusted NAV 81 10,152 10,233
Adjusted NAV (EUR per Share) 0.08 10.17 10.25
---------------------------- -------------- -------------- --------------
NOTICE: This announcement contains inside information for the
purposes of the Market Abuse Regulation 596/2014.
ADDITIONAL INFORMATION
For investment portfolio information, please refer to the
Company's most recent Financial Report, which is available on the
Company's website (www.eurocastleinv.com).
Terms not otherwise defined in this announcement shall have the
meaning given to them in the Circular.
ABOUT EUROCASTLE
Eurocastle Investment Limited ("Eurocastle" or the "Company") is
a publicly traded closed-ended investment company. On 18 November
2019, the Company announced a plan to realise the majority of its
assets with the aim of accelerating the return of value to
shareholders. On 8 July 2022, the Company announced the relaunch of
its investment activity and is currently in the early stages of
pursuing its new strategy by initially focusing on opportunistic
real estate in Greece with a plan to expand across Southern Europe.
For more information regarding Eurocastle Investment Limited and to
be added to our email distribution list, please visit
www.eurocastleinv.com.
FORWARD LOOKING STATEMENTS
This release contains statements that constitute forward-looking
statements. Such forward-looking statements may relate to, among
other things, future commitments to sell real estate and
achievement of disposal targets, availability of investment and
divestment opportunities, timing or certainty of completion of
acquisitions and disposals, the operating performance of our
investments and financing needs. Forward-looking statements are
generally identifiable by use of forward-looking terminology such
as "may", "will", "should", "potential", "intend", "expect",
"endeavour", "seek", "anticipate", "estimate", "overestimate",
"underestimate", "believe", "could", "project", "predict",
"project", "continue", "plan", "forecast" or other similar words or
expressions. Forward-looking statements are based on certain
assumptions, discuss future expectations, describe future plans and
strategies, contain projections of results of operations or of
financial condition or state other forward-looking information. The
Company's ability to predict results or the actual effect of future
plans or strategies is limited. Although the Company believes that
the expectations reflected in such forward-looking statements are
based on reasonable assumptions, its actual results and performance
may differ materially from those set forth in the forward-looking
statements. These forward-looking statements are subject to risks,
uncertainties and other factors that may cause the Company's actual
results in future periods to differ materially from forecasted
results or stated expectations including the risks regarding
Eurocastle's ability to declare dividends or achieve its targets
regarding asset disposals or asset performance.
(1) In light of the Realisation Plan announced in 2019, the
Adjusted NAV as at 30 June 2023 reflects additional reserves for
future costs and potential liabilities, which have not been
accounted for under the IFRS NAV. No commitments for these future
costs and potential liabilities existed as at 30 June 2023.
(2) Per share calculations for Eurocastle throughout this
document are based on 998,555 shares, unless otherwise stated.
(3) Reflects corporate cash and treasury investments net of
accrued liabilities and other assets where treasury investments
mainly comprise notice accounts and short term Italian Government
Bonds.
(4) Reserves that were put in place when the Company realised
the majority of its investment assets in 2019 in order for the
Company to continue in operation and fund its future costs and
potential liabilities. These reserves are not accounted for under
IFRS.
(END) Dow Jones Newswires
August 10, 2023 02:00 ET (06:00 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.
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