Street Calls of the Week
TULSA - Educational Development Corporation (NASDAQ:EDUC), a small-cap company with a market value of approximately $12 million, announced Monday it has received notice to proceed with the sale of its Hilti complex to 10Mark 10K Industrial, LLC after amending their commercial real estate contract. According to InvestingPro data, the company has faced significant challenges, with revenue declining nearly 33% over the last twelve months.
The amendment, executed on October 1, extended the initial due diligence period from October 2 to October 6 and reduced the purchase price to $32.2 million from the previously undisclosed amount.
The 402,000-square-foot complex, situated on 37 acres, includes multiple buildings with existing tenants. Approximately 183,800 square feet is occupied by Hilti under a 15-year lease, while Crusoe Energy leases about 110,000 square feet under a 10-year agreement.
According to the terms, EDC will assign the existing third-party tenant leases to the buyer at closing and will execute a separate triple-net lease for its own occupied space in the complex.
"The proceeds from the sale will be used to pay back our outstanding balances owed to our bank," said Craig White, President and CEO of Educational Development Corporation, in the press release statement. This move could improve the company’s financial health, which InvestingPro analysis currently rates as "FAIR" with a debt-to-equity ratio of 0.79.
The transaction is expected to close within the remaining 45-day period outlined in the original contract.
EDC, which specializes in children’s books and educational products, indicated that the sale would reduce its borrowings and improve monthly cash flows, as interest savings would exceed monthly rental payments while eliminating mortgage payments. Despite current challenges, the company maintains impressive gross profit margins of nearly 60% and trades at a modest 0.3 times book value. For deeper insights into EDUC’s valuation and growth prospects, investors can access comprehensive analysis through InvestingPro’s detailed research reports, available for over 1,400 US stocks.
The company is the exclusive U.S. multilevel marketing distributor of Usborne Publishing Limited children’s books and owns several educational product brands including Kane Miller Books, Learning Wrap-Ups, and SmartLab Toys.
In other recent news, Educational Development Corporation reported its second-quarter 2025 earnings, which showed a decline in revenue and a slight improvement in net loss. The company is working on strategic initiatives to stabilize its business in a challenging market environment. Additionally, Educational Development Corporation has executed a Commercial Real Estate Contract to sell its headquarters and distribution warehouse in Tulsa, Oklahoma, for $32.5 million. The proceeds from this sale are expected to pay off outstanding term loans and revolving loans under its Credit Agreement. The transaction does not include an adjacent land parcel, which will remain under the company’s ownership. In another development, Educational Development Corporation announced an extension of the maturity date on its revolving loan to September 19, 2025, through the Ninth Amendment to its existing credit agreement with BOKF, NA. This amendment aligns the revolving loan maturity with the company’s existing term loans related to its real estate. These recent developments reflect the company’s ongoing efforts to manage its financial obligations and stabilize operations.
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