Net Asset Value(s)

EPIC Reconstruction PLC
15 February 2007


                              COMPANY ANNOUNCEMENT


15 February 2007



                            EPIC Reconstruction plc



The Directors of EPIC Reconstruction plc wish to announce that the NAV for the
end of January 2007 was 70.03p per share.


The Manager continues to encourage a conservative valuation policy due to the
inherent volatility of distressed investments. This estimate reflects material
adjustments to the valuations placed on three portfolio companies. Bonne Bouche
(NAV at 31 December 2006: £4.53m) has been written down to zero as the
recoverability of the investment is considered to be minimal. Abbseal (NAV at 31
December 2006: £3.39m) has seen major restructuring and the Manager sees it as
prudent to revise the carrying value downwards by £2.81m. Kemutec (NAV at 31
December 2006: £0.25m) has been revalued upwards to £3.51m as profits continue
to increase and full repayment of EPIC Reconstruction's initial loan has now
been made.

Enquiries:

Numis Securities                              Charles Farquhar
                                              [phone]

EPIC Specialist Investments                   Giles Brand
                                              [phone]

Northern Trust                                Paul Keltie
                                              [phone]

Cardew Group                                  Richard Spiegelberg
                                              [phone]



Disclaimer: This valuation, which has been prepared in good faith by the
Company's investment adviser, is for information purposes only. It is derived
from unaudited estimated valuations of the Company's underlying investments
based on information received by the investment adviser which may relate to
dates or periods some time before the date of this valuation. Such estimates may
be subject to little verification or other due diligence and may not comply with
generally accepted accounting practices or other generally accepted valuation
principles. If a valuation estimate subsequently proves to be incorrect, no
adjustment is expected to be made to any previously published estimated net
asset value.





Trading Statement - Year ended 31 January 2007


EPIC Reconstruction plc ('ER' or 'the Company'), announces its trading update
prior to release of its preliminary results at the end of its closed period for
the year ended 31 January 2007.


Overview


The Company completed three transactions during the second half of the year (two
bolt-ons to existing investments) with the Manager reviewing over 150
opportunities.


Highlights include


   • NAV 70.03p representing a 18% decrease since 31 December 2006 (86.6p) or
     16.3p
   • Purchase of Dolcis, high street shoe retailer, for £2.7m with John
     Kinnaird a retail entrepreneur. By the year end £1.75m has been agreed to be
     returned to shareholders
   • Dividends for the year are expected to be in line with the prior year
   • The Manager has initiated a sale of four portfolio companies
   • Bonne Bouche / Oriental Express Frozen Food has been written off as an
     investment. The investment represented £4.53m or 15.1p of NAV as at 31
     December 2006


Dolcis


The shoe retailer was bought out of Alexon Group plc in December 2006 bought for
£2.7m and the Company is implementing a restructuring plan to take the retailer
back to profitability on a run-rate basis within 12 months. Since taking control
the business has performed well and the board of Dolcis has agreed to return
£1.75m of cash to Dolcis shareholders.


Dividends


Further to the interim dividend of 2.55p the Manager expects to return to the
Company's Shareholders a further dividend at the year end. The total dividend
for the year is likely to be comparable to the prior year level of 5.58p for the
year ending 31 January 2006.


Portfolio sale


Owing to interest in four portfolio companies the Manager has decided to
investigate a discreet portfolio sale with certain selected interested parties.
The process is still at an early stage and Shareholders will be updated in due
course.


Bonne Bouche / Oriental Express Frozen Food (BBF)


During the recent period BBF has experienced severe trading difficulties and
eventually banking facilities were withdrawn. The Company has decided not to
support the business any further and BBF has now gone into administration. The
key reasons for the demise of the business were:

-    Continued unfavourable market conditions particularly in the retail sector

-    Poor margin and cash generation over the peak Christmas period and
     into the New Year

-    Low order book in Q1 2007

-    Increased production costs from key suppliers


The write-down of the investment represents £4.53m of value which equates to
15.1p of NAV.

Year end portfolio revaluation


As part of an annual exercise to assess the fair value of the portfolio the
Company has taken the year end opportunity to reflect the findings in the
carrying value of the portfolio companies at this stage.

Adjustments of note include Kemutec and Abbseal.


Prior to year end Kemutec was held at cost (£0.3m) having paid back 100% of the
original loan made by ER. During the year to March 2007 the company is budgeted
to reach a 10% EBITDA margin. The company is now substantially un-levered and
has started repayment of the preferential share in favour of ER. Therefore the
asset has been written-up to reflect the inherent value in the business which
has now been stabilised by Management. The Management continue to look for
strategic acquisitions to grow the business further. The increase represents
£3.2m or 10.7p uplift on the NAV of ER.


Abbseal has encountered tough trading conditions for several months. The key
contributions to this have been increasing glass prices, high levels of
competition and glass demand from the continent affecting supply. The business
has recently been restructured taking the operation down from three operational
sites to one. In view of the downsizing and the more limited scope for value
creation the carrying value of the investment will be written down to reflect
the expectation of a lower percentage of recovery on the investment. The funds
invested in the business as at 31 December 2006 was £3.39m . The write down will
represent a 9.3p change in the NAV (£2.79m).


Outlook


The Manager continues to assess new distressed opportunities as well as to seek
to create further value creation opportunities within existing portfolio
companies. Despite the decrease in NAV the Board believes that the prospects for
the Company as a whole remain encouraging.




                      This information is provided by RNS
            The company news service from the London Stock Exchange
                   M