PINEWOOD GROUP PLC: TRADING UPDATE, STRATEGIC REVIEW AND COMMENCEMENT OF OFFER PERIOD

Since the publication of the Interim Results on 1 December 2015, film revenues have benefited from a robust growth in ancillary sales whilst also continuing to operate at high stage utilisation levels.

Television revenues have performed well in the second half of this financial year.

Media Hub revenues have also performed strongly as a result of high occupancy.

The Company has continued to develop its international revenues, with strong growth from its joint venture in Atlanta, Georgia.

Media Investment revenues, as anticipated, have grown in the second half of this financial year.

Accordingly, management’s current expectations of performance for the financial year ending 31 March 2016 are now higher than at the time of the interim results last December.

Phase One of the Pinewood Studios Development Framework (“PSDF”) expansion is on schedule for completion in June 2016 and within budget. Phase One will add five new large sound stages and additional facilities totalling 300,000 sq. ft.

Ivan Dunleavy, Chief Executive, said:

“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”.

Strategic Review of capital base and structure

The Board believes that the Company, as the world leading studio and production services operator, has significant future growth potential.

The objectives of last year’s share placing, which was successfully completed on 17 April 2015, were to raise proceeds of £30m to part fund Phase One of the PSDF development and also to create a more diversified shareholder base that would be able to support the Company through subsequent phases of growth and enable the Company to move up to a full listing on the main market.

The shareholder register, however, remains tightly held, which has continued to stifle liquidity in the shares and has 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. 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.

Accordingly, the UK Takeover Panel (“the Panel”) has agreed that any discussions with third parties may be conducted within the framework set out in Note 2 on Rule 2.6 of the Takeover Code (the “Code”).  The Panel has granted a dispensation from the requirements of Rules 2.4(a), 2.4(b) and 2.6(a) of the Code such that any interested party will not be required to be publicly identified as a result of this announcement (subject to note 3 to Rule 2.2 of the Code) and will not be subject to the 28 day deadline referred to in Rule 2.6(a), for so long as it is participating in discussions with Pinewood.

Commenting on the Strategic Review, Ivan Dunleavy, Chief Executive, said:

“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.”