<p><strong>Shareholder Update:</strong></p>

<p>Enclosed is the first draft P&amp;L and cash flow forecasts for Farringdon Pub Ltd. As more detail is provided by Government we will be able to develop the forecasts further but unfortunately the combined impact of enforced social distancing and depressed consumer demand will have a severe affect on trading performance. There could be an ability to take advantage of weekly trading patterns across the Harcourt Inns estate and move staff accordingly and hence reduce wage costs although this will be subject to a reorganisation of the group.</p>

<p>Whilst we expect the pub to break even over the 12 month period, non operating expenses will result in an overall loss.</p>

<p>Prior to COVID-19 and lockdown we were close to securing an exit solution to present to shareholders. Unfortunately this is no longer an option and so we have been working on an alternative exit plan to present to shareholders in the coming weeks that will enable the business to reduce costs and to become sustainable in a short to medium term low revenue environment.</p>

<p>There is now an urgent need to reorganise the structure of the pub and although the detail is being worked on we are looking at options that provide shareholders with a partial exit and equity upside to share in the long term recovery in business performance and values and any future development works.</p>

<p>Harcourt Inns expects to be able to appoint two highly experienced business operators in the next few weeks to help guide the group through a challenging transition period, the medium-term effects of COVID-19 and hopefully the subsequent long term success of the pubs and the group as a whole. Although we aren&rsquo;t in a position to mention names at this stage one appointment, as Chairman, is a highly regarded operator and CEO having built and subsequently sold a multi-billion pound operational real estate business and the other appointment, who will become a non executive director, built and sold one of London&rsquo;s most successful pub, dining and hotel groups over the last 15 years.</p>

<p>We intend to provide a shareholder exit proposal in July 2020.</p>