U CITY PCL CAPITAL RESTRUCTURING 30 AUG 2018
IR CONTACT Address: U City Public Company Limited IR Department 20 th Floor, TST Tower, 21 Soi Choei Phuang, Viphavadi-Rangsit Rd. Chomphon, Chatuchak, Bangkok, Thailand 10900 Telephone: +66(0) 2273 8838 #2301 Fax: +66(0) 2273 8858 Email: ir@ucity.co.th Website: www.ucity.co.th DISCLAIMER This document has been prepared and distributed by the Investor Relations Department of U City Public Company Limited (“U City”) solely for information purposes. It does not represent or constitute an offer, invitation, recommendation or solicitation to trade shares in U City and should not be relied on as such. Some of the information in this document has not been independently verified, and also includes information made available from public sources and other third party opinion or analyst. U City does not monitor or control the content of third party opinion or statements and does not endorse or accept any responsibility for the content or the use of any such opinion or statements. Thus, U City assumes no responsibility and makes no representations with respect to the accuracy and/or completeness of the information described herein. None of U City or any of its agents, or all of their respective affiliates, or representatives shall have any liability (in negligence or otherwise) for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection with this document. All information contained in this document is presented as of the date indicated within, and U City assumes no duty to confirm, revise or update the information. Certain statements in this document may be deemed to contain forward-looking statements, including the statements included or incorporated with the words "believe", "anticipate", "estimate", "target", or "hope", or that otherwise relate to objectives, strategies, plans, intentions, beliefs or expectations or that have been constructed as statements as to future performance or events. These forward-looking statements are not guarantees of future performance and involve risks and uncertainties that could cause actual results to differ materially from historical results or those anticipated at the time the forward-looking statements are made. Thus, U City assumes no responsibility and makes no representations with respect to the accuracy and/or completeness of the forward-looking statements. U City undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Capital Restructuring prepared by Investor Relations department 2 U City Public Company Limited
CURRENT SITUATION Unable to Distribute Dividends, Wide Relative Bid-Ask Spread of U City Shares U City Balance Sheet (separate F/S) as of 30 June 2018 44,760 U City is unable to • 766 distribute dividends to its Negative Current shareholders as Components of Shareholder’s Equity THB mn Retained 14,034 Liabilities regulations restrict Issued & fully paid ordinary & preference shares 935,429 Earnings Non-Current companies with retained Share discount on ordinary & preference shares (895,601) (Deficit) Liabilities losses and share discount Deficit (9,519) Equity in their separate financial Other components of shareholders' equity (349) 29,960 Total Shareholders' equity 29,960 statements to do so THB THB mn U City 1-Year Stock Chart as of 30 Aug 2018 0.05 300 250 0.04 +33% U City’s current share 200 • 0.03 structure means that 150 Inefficient -50% current bid-ask spreads 0.02 Share are abnormally and 100 Structure relatively high, which 0.01 50 results in inefficient 0 0 trading and illiquidity U Turnover (RHS) U Share Price (LHS) Capital Restructuring prepared by Investor Relations department 3 U City Public Company Limited
BENEFITS OF THE TRANSACTION Gaining the Ability to Distribute Dividends and Reduce Trading Volatility OBJECTIVE: KEY RESTRUCTURING TRANSACTION: “To write off company’s deficit to support potential dividend payout in #2 Clearing retained loss/deficit the future” #1 Reverse stock split and share discount Benefits of the Proposed Transactions U City will be able to pay dividends to its shareholders from profits realised in the near future The alternative is a lengthy process of gradually reducing its retained losses/deficit and share discount. U City would be • unable to pay dividends, despite being profitable until it clears its retained losses and share discount U City can fulfill its commitment to its preference shareholders Following the capital raising on 16 March 2018, U City is committed to paying 5 annual payments of approximately THB • 823mn/year to its preference shareholders. U City would be unable to do so in the near future until this legacy issue is resolved Reduce trading volatility and illiquidity of U City’s shares The high bid-ask spread is detrimental to shareholders and future investors looking to trade in U City stock. The high volatility • of trading is a factor in the stock’s current illiquidity Enable a more diversified shareholder base High fluctuations in the value of the stock make U City unattractive on a risk management standpoint for institutional investors. By • reducing these relative price fluctuations and trading illiquidity, U City’s stock would be more ‘investable’ Capital Restructuring prepared by Investor Relations department 4 U City Public Company Limited
TRANSACTION OVERVIEW Pre Reverse Stock Split and Capital Post Reverse Stock Split 100:1 and Capital Unit Reduction (Separate F/S Reduction* as of 30 June 2018) 1,682,739 44,900 Registered capital THB mm Paid up capital THB mm 935,429 29,934 Share discount THB mm (895,601) - Retained earnings THB mm (9,519) (25)** (Retained loss/deficit) Other components THB mm (349) 10 Total shareholders’ 29,960 29,919 THB mm equity 1,682,739 14,031 Registered shares mm shares Paid up shares mm shares 935,429 9,354 Par value/share THB 1.00 3.20 Trading price/share THB 0.03 3.00 * Based on management accounts as of 30 Aug 2018 **Including operating loss, impairment of investment in NMG and allowance for impairment of investment in BMP during 1 July – 30 Aug 2018 The above is subject to shareholders’ approval at the EGM Capital Restructuring prepared by Investor Relations department 5 U City Public Company Limited
KEY TIMELINES Clearing Retained Losses & Reverse Stock Split Commence trading Commence trading Private placement with new par value with new par value (PP) subscription for after reverse stock after capital U City EGM record date rounding purpose split reduction Mid of Oct End of Oct Beg Nov of Mid of Dec End of Dec 30 Aug 18 13 Sep 18 12 Oct 18 18 18 18 18 18 Board of Directors U City EGM for Rights adjustment of all End of creditor Approved the shareholders’ warrants (U-W1 -> U- objection transaction approval W4) Creditor objection period (2 months) Capital Restructuring prepared by Investor Relations department 6 U City Public Company Limited
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