// Topps Tiles confirms sale of head office and central warehouses for £18.1m
// The sale is expected to be completed early this month
Topps Tiles has agreed to the £18.1 million sale and leaseback of its Leicester head office and central warehouse buildings to UK Warehouse Properties Limited.
The completion of the sale is expected to take place in early June 2020, and represents a premium of approximately 29.3 per cent to the balance sheet asset value of the properties of £14.0 million.
The proceeds from the sale are expected to further strengthen the Topps Tiles’ financial position as it responds to the Covid-19 crisis.
READ MORE: Topps Tiles swings to £4m half-year loss
Based on the group’s net debt position at May 29, it would have net debt of £7 million with £42 million of available liquidity.
This also includes the credit approved CLBILS £10 million loan facility which the company announced on May 19 and which is due to be finalised soon.
Meanwhile, Topps Tiles has also entered into leases for the properties for a 20-year period following completion, for an annual rent of £1.2 million.
Under IFRS 16, right of use assets worth £15.7 million will be reflected on the group’s balance sheet, along with associated lease liabilities of £15.7 million.
Topps Tiles swung to a half year loss last month after its revenue was hit by the Covid-19 crisis and also a tough trading environment before the pandemic even started.
In its trading update for the six months to March 28, the retailer suffered a £4 million statutory pre-tax loss.
This compares to a £5.2 million half-year profit the prior year.