Capital Pub Company, the London-based managed house chain, has this morning given an update on trading in which it revealed it had reduced its debts by £5.19m. This was achieved after the Moorfield Real Estate Fund upped its stake in the business to 8.7% and via the sale of a freehold asset for £3.49m.
Moorfield, the property investor and private equity fund manager, acquired more than a million extra shares in the company – which raised approximately £1.7m for it to use to pay down debt. Capital also sold the freehold of the Marquis of Granby pub on Shaftesbury Avenue for £3.49m, but said it will continue to manage it on a short-term lease.
Subsequently, the company’s net debt fell to £23.3m, down from around £29m.
In an update, the AIM-listed group said that current trading was “significantly ahead of last year, reflecting the strength of the London economy and our well-positioned estate of pubs.”
Separately, the company also revealed it planned to develop a share incentive scheme for its employees with more than one year’s service – and that it would match employee share purchases of up to £1,000.
Clive Watson, Capital’s chief executive, said: “Current trading remains strong and whilst we remain cautious regarding the economy following the General Election, we are encouraged by the strength of the London market. I am delighted to reward our staff for their continuing contribution to the success and development of the company through the new incentive scheme that is being put in place.
“We look forward to working with Moorfield and leveraging their significant real estate and investment experience. Both the disposal of the Marquis of Granby and the placing have reduced gearing and strengthened the balance sheet significantly.
“This provides the company with a platform to continue the future growth of the business.”
It added that a recent evaluation of its estate by AG&G had resulted in a book value of £64m.
