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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Dci Advisors Ltd | LSE:DCI | London | Ordinary Share | VGG2803G1028 | COM SHS EUR0.01 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 4.75 | 4.50 | 5.00 | 4.75 | 4.75 | 4.75 | 0.00 | 08:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Real Estate Agents & Mgrs | 318k | -6.92M | -0.0077 | -6.17 | 42.97M |
From Apr 2019 to Apr 2024
TIDMDCI
RNS Number : 2781L
Dolphin Capital Investors Limited
30 September 2016
30 September 2016
DOLPHIN CAPITAL INVESTORS LIMITED
("DCI" or "Dolphin" or the "Company"
and together with its subsidiaries the "Group")
Disposal of 49.75% stake in Aristo Developers
Half Year Results for the six months ended 30 June 2016
Trading Update
Highlights:
-- On 29 September 2016 the Company signed a binding agreement to sell its 49.75% stake in Aristo Developers Ltd ("Aristo") to Mr. Theodoros Aristodemou for a EUR45 million cash consideration. This represents a 70% discount to the carrying value as at 31 December 2015 on a pro-forma basis reflecting Aristo's debt restructuring agreed with Bank of Cyprus. The EUR45 million cash consideration is payable in quarterly instalments over three years and bearing annual interest of 4% in the first year, increasing to 5% and 6% respectively for each of the ensuing two years.
-- Arranged a new EUR7.5 million 18 month credit facility with a major financial institution, subject to definitive documentation, which on signing will create additional liquidity for general corporate purposes.
-- Amanzoe performance is significantly ahead on a year-on-year basis, especially with respect to villa rental income.
-- Total Group Net Asset Value ("NAV") as at 30 June 2016, as adjusted for the disposal of Aristo, was EUR355 million and EUR317 million before and after Deferred Tax Liabilities ("DTL") respectively. This represents a decrease of EUR190 million and EUR164 million, or 34.8% and 34.1%, respectively, against the year end 2015 figures.
-- NAV reduction is mainly due to:
o the reduction in the carrying value of Aristo by EUR35 million from the debt restructuring agreement reached with Bank of Cyprus in June 2016 and half year operating losses, as well as a further EUR109 million write-down on Aristo's carrying amount to reflect the agreed EUR45 million sales price; and,
o Dolphin's regular operational, corporate, finance and management expenses, as well as the devaluation of the Americas properties in Euro terms due to the appreciation of the Euro against the US Dollar by c. 2%.
-- No portfolio revaluation was undertaken during this period; the next full portfolio valuation will be conducted at 31 December 2016.
-- Sterling NAV per share as at 30 June 2016 stood at 32p before DTL and 29p after DTL, a 26.8% and 26% decrease before and after DTL respectively compared to the 31 December 2015 figures. The decrease was mainly driven by the factors mentioned above, offset by a 12.3% appreciation of the Euro versus Sterling.
-- The Company continues to have a significant asset base, after the sale of its shareholding in Aristo:
o Gross Assets of EUR700 million
o Total Debt of EUR215 million (EUR232 million as at 31 December 2015) with a Group total debt to total assets value ratio of 31% respectively. The remaining US$16.7 million of the 2016 Convertible Bonds, which matured on 31 March 2016, were repaid in full.
-- Sue Farr joined the Board of Directors on 19 July 2016.
Commenting, Andrew Coppel, Non-Executive Chairman of Dolphin's Board of Directors said:
"We are delighted to have completed the disposal of our holding in Aristo Developers. The sale will significantly enhance the Group's liquidity and allow the Company the flexibility to deliver value for shareholders through the monetization of assets on a timely basis."
Miltos Kambourides, Founder of Dolphin and Managing Partner of Dolphin Capital Partners said:
"The sale of Aristo Developers is the first major step towards further asset realizations and focusing on the Company's core assets. We look forward to accelerating this process."
For further information, please contact:
Hot Features
Premium
Dolphin Capital Investors
Andrew M. Coppel, CBE +44 (0) 7785 577023
Dolphin Capital Partners
Miltos E. Kambourides miltos@dolphincp.com
Panmure Gordon
(Broker)
Richard Gray/Dominic Morley/Andrew
Potts +44 (0) 20 7886 2500
Grant Thornton UK LLP
(Nominated Adviser)
Philip Secrett +44 (0) 20 7383 5100
Instinctif
(PR Communications Adviser)
Mark Garraway +44 20 7457 2007
A. Chairman's Statement
I am pleased to report Dolphin's interim financial results for the period ended 30 June 2016 and provide a trading update for the period.
The revenue for the six month period rose from EUR8.1 million to EUR15.9 million and the operating losses were reduced from EUR20.8 million to EUR11.3 million.
Following the Board's decision earlier this year to accelerate asset divestments and improve liquidity, the Company was able to achieve tangible results through the disposal of our 49.75% investment in Aristo.
The Aristo divestment, further details of which are set out in paragraph B.2.2. of the Investment Manager's Report below, will result in significant cash inflows for the Company over the next three years thereby allowing the Group to proceed with its value realization policy for the remaining portfolio from a position of financial strength. However, this disposal has also resulted in an impairment charge in these financial statements of EUR109 million, in addition to the EUR35 million charge following Aristo's debt restructuring agreement reached with Bank of Cyprus and Aristo's half year operating losses to 30 June 2016.
Whilst the agreed sale proceeds are significantly below the adjusted net asset value of DCI's interest in Aristo as at 30 June 2016, it should be emphasised that this figure essentially reflects the appraised value of the aggregate of Aristo assets, net of liabilities, in accordance with IFRS requirements. This carrying amount takes no account of the fact that Aristo has not adopted an asset disposal strategy that could generate dividends for DCI in the near future, nor of Aristo's annual overheads, financing expenses and potential further NAV reductions due to additional bank restructurings. Furthermore, it takes no account of the commercial reality that our shareholding represented an illiquid substantial minority position in Aristo.
On 19 July 2016, Sue Farr joined the Board, which now consists of six members. Sue is also a non-executive director at ACCSYS Technologies plc, British American Tobacco plc, Dairy Crest plc and Millennium & Copthorne plc, and has won wide recognition in the marketing sector and a number of awards.
The Board is aware of its commitment to convene a shareholders' meeting before 31 December 2016, so that shareholders have an opportunity to review the life of the Company and consider a resolution for its continuation and future strategy. The Board is in the process of formulating its proposal to Dolphin's shareholders and this will be announced in the near future.
We have made good progress to secure the Group's financial position and begin to realise value for shareholders. The Board and the Investment Manager will continue their efforts to increase working capital and accelerate shareholders' returns through the monetization of assets. We believe that further tangible results can be achieved in the short term.
Andrew M. Coppel CBE
Non-Executive Chairman
Dolphin Capital Investors
30 September 2016
B. Investment Manager's Report
B.1. Business Overview
During the first half of 2016 we continued the development of our Core Projects (ranging from villa sales initiatives and construction of sold villas to advancing zoning and permitting) and progressed a number of discussions to monetise the Group's portfolio assets and explore joint venture options. These have so far resulted in the sale of DCI's minority stake in Aristo while a number of other discussions remain ongoing.
Our recent actions can be summarised as follows:
-- Sold Dolphin's 49.75% minority position in Aristo for a cash consideration of EUR45 million, full details of which are set out below, which will make a significant contribution to meeting the Group's overheads and operational expenses (including non-operating project interest costs) over the next three years.
-- Realised continuously improving revenue and Net Operating Income ("NOI") in Amanzoe which is expected to exceed our 2015 results.
-- Successfully managed the first year of Amanera operations through the Zika outbreak in the Caribbean, achieving higher Average Daily Rate ("ADR"), albeit at lower occupancy rates, than targeted.
-- Signed additional sales and/or reservation agreements for the sale of Seafront villas in Kilada Hills and at La Vanta.
-- Arranged a EUR7.5 million 18 month revolving credit facility with a major regional financing institution, subject to documentation, which, on signing, would enhance Dolphin's liquidity.
We continue to focus on the implementation of the Company's strategy to realise the value of our diverse asset portfolio in order to maximise cash returns for our shareholders, which include the sourcing of disposal or JV opportunities for our projects, and the further refinement of our sales and marketing strategy to increase the pace of villa sales.
We are confident that these efforts should result in the conclusion of further transactions in the near term.
B.2. Portfolio Review
B.2.1. CORE PROJECTS
-- Amanzoe, Greece (www.amanzoe.com)
- Amanzoe initiated operations for the 2016 season on 1 April 2016, as scheduled, with seven villas in the rental programme. Hotel performance is currently ahead of last year, with occupancy reaching 61.4% and an Average Daily Rate ("ADR") of EUR1,122 versus 56.5% and EUR1,116 recorded on the books in 2015, ie 9% and 1% higher respectively on a year-on-year basis.
- The Villa rental daily rates ranged from EUR4,800 to EUR25,000 and generated revenues that are 39% above budget for the period up to and including August 2016.
- During the summer season, several site visits took place with potential villa buyers, and a number of them are currently in negotiations which are expected to be concluded by the end of the year. Sothebys Real Estate was hired as a marketing and sales agent for the Amanzoe Villas on 1 April 2016 and has already contributed some sales leads.
- All construction works were suspended during the summer period so as not to disturb the smooth operations of the resort. Works are expected to resume in the fourth quarter of 2016, with the commencement of construction of three villas.
- Amanzoe continues to receive outstanding reviews. Victoria Hislop included the resort and its Villa 20 in her recent article in the Daily Mail and praised Amanzoe's beauty once again. The resort's architecture was also mentioned in The Evening Standard while the resort was voted as The Most Expensive Resort in Europe in the Mr & Mrs. Smith list. The resort's Villa 20 was also extensively featured in The Daily Telegraph's quarterly luxury supplement, Ultra travel, as well as in its Travel section of the Year. At the same time, the resort was featured in the UK Harper's Bazaar, the Russian online magazine Buro247.ru, the Brazilian Vogue, the Italian Glamour magazine, the Turkish In Style, the Horizon & Beyond publication of the Middle East and in the UK Country & Town House magazine.
-- Amanera, Dominican Republic (www.amanera.com)
- The Amanera Golf Resort at Playa Grande was delivered as scheduled and formally opened for paying guests on 23 November 2015. The Amanera hotel achieved occupancy and average daily rates of 43.5% and US$1,549 respectively during the first eight months of 2016. ADR was above expectations but occupancy was lower than budget, primarily due to the Zika outbreak which affected the Caribbean region. Measures are being implemented, in conjunction with Aman, to improve occupancy and underlying profitability.
- The hotel closed on 26 August 2016 and will remain closed until 31 October 2016, the low season in the Caribbean, in order to implement a number of improvements that have been identified since opening.
- In order to increase the sales velocity of Amanera Villas, a key factor to the project's financial sustainability, the Company has adopted a more focused sales, marketing and PR plan. In March 2016, Bespoke Real Estate, a real estate brokerage and consulting boutique, was hired as a marketing and sales agent for the Amanera Villas and has generated a number of interested potential buyer leads who are expected to visit the resort from November 2016 onwards.
- The Amanera hotel continues to receive accolades from the world's top travel publications. It was featured on the cover of the March 2016 issue of Travel + Leisure Magazine as well as Vogue, Financial Times "How to Spend it", Wallpaper, Robb Report, New York Times and Conde Nast Traveller, with the last-mentioned featuring the resort at the top of their "Hot list" for the Caribbean. The golf course also continues to receive exceptional reviews from industry commentators and extensive coverage including articles in Golf Week, Golf Digest and Discover Golf.
-- Kilada Hills Golf Resort, Greece
- Subsequent to the issuance of the presidential decree granting special zoning to the Kilada Hills Project in December 2015, the residential master plan remains under review as planned in the relevant ministries, with an expected approval prior to the end of 2016. Once approved, the freehold sale of lots will be permissible.
- A residential offering proposal for a set of 40 Founder Golf Lots has been prepared. It is expected that the interest generated from the founding programme will facilitate securing the external funding of the first phase of the project, including the Jack Nicklaus Signature Golf Course, the golf clubhouse, the beach club and relevant infrastructure works.
-- Pearl Island ("Pearl Island" - www.pearlisland.com), Panama
- The project team is in the process of completing the Ritz Carlton Reserve detailed designs and value engineering. Commencement of construction is subject to securing US$33 million of third party equity capital. Debt financing of US$33 million has been arranged but not yet drawn down.
- In the meantime, development expenses and project overheads have been kept at a minimum necessary for the project to continue its operations.
- The first group of turn-key villas and condos in the Founder's Phase (which is owned by a regional investor group which is our local partner in the island) were delivered in December 2015, together with the already completed beach club, airstrip, service pier, and main island infrastructure, first phase of the marina and other common amenities in the Founder's Phase.
- The Founder's Phase, which has been sold by Dolphin on 5 September 2012, has already sold or reserved 109 residential units consisting of high-end lots, villas and condo apartments. Out of these units sold, the project has already delivered 36 lots connected to all utilities, together with a further 20 completed villas and condos and 28 marina berths / slips.
-- Kea Resort, Greece
- The Company is advancing discussions with an international resort and real estate investor for a joint venture transaction involving an equity investment, required for the construction of the Kea resort, for a 50% shareholding stake in the project.
B.2.2. NON-CORE ASSETS
-- Aristo (a 49.8% affiliate)
- The Company reached agreement on 29 September 2016 to divest its 49.75% shareholding in Aristo to an legal entity owned by Mr. Theodore Aristodemou and his family.
- The divestment will be effected by way of a sale of 49.75% of the shares in DCI Holdings Two Ltd by DCI Holdings One Ltd (a wholly owned subsidiary of DCI) for a total cash consideration of EUR45 million, payable in quarterly instalments over three years and bearing annual interest of 4% in the first year, increasing to 5% and 6% respectively for each of the ensuing two years. A EUR2 million discount to the total consideration will be granted if the full consideration is settled by 29 December 2016.
- The sold shares in DCI Holdings Two Ltd will be kept in escrow and transferred to Mr. Aristodemou in line with the collection of the consideration by the Company, apart from a percentage of c. 20% which will remain escrowed until 50% of the payment is received by the Company and c. 10% until the final settlement of the consideration. Potential dividend distributions corresponding to the shares kept on escrow will also remain escrowed. In the event that any payment becomes overdue for more than three months either party has the right to terminate the sales agreement, in which case all the shares kept in escrow together with any corresponding dividend distributions will be retained by Dolphin.
- Dolphin will also be entitled to a 25% share of any gross proceeds in excess of an implied company equity valuation of EUR100 million from the sale of any shares of Aristo by the Acquirer until the earlier of six months from the settlement of the full consideration (to the extent such settlement occurs by 29 December 2016) and the second anniversary from the transaction.
- DCI will continue to be entitled to one seat on the Board of Aristo as long as a minimum of a 10% holding is retained, as well as keeping certain minority protection rights.
- As at 31 December 2015, DCI's interest in Aristo was carried in DCI's accounts at EUR189 million. Following the completion of the restructuring arrangement with Bank of Cyprus earlier this year and Aristo's half year losses, this was reduced to EUR154 million. The divestment resulted in a further impairment charge of EUR109 million in DCI's financial statements for 30 June 2016, with Aristo now recorded at its recoverable amount of EUR45 million.
- Aristo's sales significantly increased during the six month period compared to the respective period in 2015, however the Company incurred operating losses.
-- Nikki Beach, Porto Heli (a 25% DCI affiliate)
- The operations improved significantly during 2016 compared to 2015. The expected occupancy for the 2016 operational period is 55% (163 days) compared to 48% for 2015 (169 days), with a net ADR up more than 35% expected at EUR250 vs EUR183 last season.
- At the same time there was a major improvement on the cost side with total expenses down c. 25%.
-- Sitia Bay
- As announced on 30 June 2016, Dolphin has signed an MoU for the sale of its 78% stake in Sitia Bay for EUR17.2 million, which was subject to receipt of an initial deposit from the purchaser. The initial deposit was not received, and Dolphin is therefore progressing discussions with other potential purchasers.
-- LaVanta
- Two additional villas were sold, and one reservation agreement was signed. Upon conversion of the reservation agreement into final contract form, the first phase of LaVanta will be fully sold.
C. Market Dynamics
The key points with regard to the tourism industry evolution in Dolphin's basic markets are as follows:
- In Greece, for the period between January and July 2016, international arrivals rose by 6.4% compared to the same period last year. The Greek Tourism Confederation noted that the surge in last-minute bookings means that there is a strong likelihood that the target set at the start of the year, for an increase of 6% in arrivals over the course of the whole year, can be achieved.
- In Cyprus, for the period January - July 2016 tourist arrivals totalled 1.74 million compared to 1.45 million in the corresponding period of 2015, recording an increase of 20% as reported by the country's Statistical Service. The most recent estimate for 2016 tourist arrivals is 3.1 million compared with 2.65 million in 2015 and 2.7 million in 2001 which was the last record year.
- The Dominican Republic continues to be the Caribbean's largest tourist destination. The economy grew robustly in the first half of 2016 and the tourism sector had a strong performance. The period from January to July 2016 saw 6.9% growth in tourist arrivals compared to 2015, reaching over 3.6 million visitors according to the Dominican Republic's Central Bank. The country is projected to reach 6 million total visitors in 2016, thus meeting the targeted 7% growth.
- Despite the release of the Panama Papers and other challenges, the Panamanian economy is gaining traction and GDP is expected to increase by 5.9% in 2016, the highest rate in the region. The opening of the Canal expansion in late June and the income it will generate will provide further strength to the economy. Over the course of January through June 2016, the total number of visitors was approximately 1.17 million, indicating a 1% increase compared to 2015, based on the data provided by the National Institute of Statistic and Census. Tourist expenditure was US$2.4 billion, representing an increase of 4.4%, compared to the same period of 2015.
D. Group Assets
A summary of Dolphin's current investments is presented below. As at 30 June 2016, the net invested amount, excluding DCI's interest in Aristo, stood at EUR412* million.
PROJECT Land DCI's Investment Debt Real Loan to
site stake cost* (EURm) estate real estate
(hectares) (EURm) ** value asset
(EURm) value
*** (%)
--- --------------------- ------------ ------- ----------- -------- -------- -------------
CORE PROJECTS
1 Amanzoe 93 100%** 38 77
Playa Grande
2 Club & Reserve 839 100% 94 55
3 Pearl Island 1323 60% 29 -
Kilada Hills
4 Golf Resort 235 100% 94 -
5 Kea Resort 65 67% 9 -
--- --------------------- ------------ ------- ----------- -------- -------- -------------
TOTAL 2,555 264 132 458 29%
--- --------------------- ------------ ------- ----------- -------- -------- -------------
NON-CORE PROJECTS
The Nikki Beach
6 Resort & Spa 1 25% 6 -
Sitia Bay Golf
7 Resort 270 78% 17 -
8 Scorpio Bay Resort 172 100% 15 -
Lavender Bay
9 Resort 310 100% 25 -
10 Plaka Bay Resort 442 100% 13 -
11 Triopetra 11 100% 4 -
Apollo Heights
12 Polo Resort 461 100% 22 16
13 Livka Bay Resort 63 100% 28 9
La Vanta - Mediterra
14 Resorts 8 100% 16 < 1
TOTAL 1,738 146 26 165 15%
--- --------------------- ------------ ------- ----------- -------- -------- -------------
Itacaré
Investment n/a 10% 2 -
DCI Corporate n/a n/a n/a 58 -
Bonds
--- --------------------- ------------ ------- ----------- -------- -------- -------------
GRAND TOTAL 4,293 412 216 623 35%****
--- --------------------- ------------ ------- ----------- -------- -------- -------------
*Residual investment cost, including amounts paid in shares but excluding Dolphin's 49.75% shareholding in Aristo which has been sold on 29 September 2016.
** Further details on debt maturities are set out under note 23 of the financial statements.
*** Excluding the EUR45 million Aristo disposal receivable.
**** Group total debt to total gross asset value ratio is 26%.
A breakdown of Dolphin's portfolio for certain key metrics is provided below.
COUNTRY Land Investment Debt Real % Loan Net Asset
size Cost (EUR Estate to real Value
(hectares) * million) Value estate
(EUR (EUR asset
million) million) value
----------------- ------------ ----------- ---------- ---------- --------- ----------
1 Greece 1,599 220 77 304 25% 44%
2 Cyprus** 461 22 16 35 47% 12%
3 Croatia & Turkey 71 46 9 43 22% 9%
4 Americas 2,162 124 55 241 23% 35%
----------------- ------------ ----------- ---------- ---------- --------- ----------
Grand Total 4,293 412 157 623 25% 100%
----------------- ------------ ----------- ---------- ---------- --------- ----------
* Residual investment cost, including amounts paid in shares.
** Excluding Dolphin's 49.75% shareholding in Aristo which has been sold.
Land Investment Debt Real % Loan Net Asset
size Cost (EUR Estate to real Value
(hectares) * million) Value estate
(EUR (EUR asset
million) million) value
------------------ ------------ ----------- ---------- ---------- --------- ----------
1 CORE PROJECTS 2,555 264 132 458 29% 70%
2 NON CORE ASSETS** 1,738 148 25 165 15% 30%
------------
Grand Total 4,293 412 157 623 25% 100%
------------------ ------------ ----------- ---------- ---------- --------- ----------
* Residual investment cost, including amounts paid in shares. ** Excluding Dolphin's 49.75% shareholding in Aristo which has been sold.
E. Future Objectives
The Company's main objectives for the remainder of 2016 are to:
1. Continue the monetization of additional Core and Non-Core portfolio assets;
2. Secure third-party funding for the development of the remaining Core Assets through sales, joint venture and financing transactions in order to increase their realization potential and value;
3. Increase sales velocity of villas; 4. Oversee the implementation of the Aristo transaction;
5. Complete the EUR7.5 million 18 month revolving loan facility to ensure that the Group has continued liquidity to meet its ongoing obligations over the medium term; and,
6. Where appropriate, advance the zoning, permitting, design and branding of Core and Non-Core Assets to improve their sales potential and actively pursue their divestment.
Miltos Kambourides Pierre Charalambides Managing Partner Founding Partner Dolphin Capital Partners Dolphin Capital Partners 30 September 2016 30 September 2016
F. Financial Position for the first half of 2016
F.1. Condensed consolidated interim statement of profit or loss and other comprehensive income for the H1 2016
-- Financial Results
Loss after tax for the period ended 30 June 2016 attributable to owners of the Company amounted to EUR162 million compared to EUR36 million loss for the six-month period ended 30 June 2015. Loss per share was EUR0.18 and EUR0.05 for the six-month period ended 30 June 2016 and 30 June 2015 respectively.
From 1 January 2016 From 1 January 2015
to 30 June 2016 to 30 June 2015
EUR'000 EUR'000
--------------------------------------------------------- -------------------- --------------------
Continuing operations
--------------------------------------------------------- -------------------- --------------------
Revenue 15,877 8,073
--------------------------------------------------------- -------------------- --------------------
Net change in fair value of investment property (11) (96)
--------------------------------------------------------- -------------------- --------------------
Total operating profits 15,866 7,977
--------------------------------------------------------- -------------------- --------------------
Operating expenses (14,122) (13,007)
--------------------------------------------------------- -------------------- --------------------
Investment Manager remuneration (4,511) (6,814)
--------------------------------------------------------- -------------------- --------------------
Directors' remuneration (1,071) (304)
--------------------------------------------------------- -------------------- --------------------
Depreciation charge (1,401) (1,506)
--------------------------------------------------------- -------------------- --------------------
Professional fees (4,054) (3,728)
--------------------------------------------------------- -------------------- --------------------
Administrative and other expenses (1,965) (3,481)
--------------------------------------------------------- -------------------- --------------------
Total operating and other expenses (27,124) (28,840)
--------------------------------------------------------- -------------------- --------------------
Results from operating activities (11,258) (20,863)
--------------------------------------------------------- -------------------- --------------------
Finance income 22 240
--------------------------------------------------------- -------------------- --------------------
Finance costs (9,412) (9,724)
--------------------------------------------------------- -------------------- --------------------
Net finance costs (9,390) (9,484)
--------------------------------------------------------- -------------------- --------------------
Gain on disposal of investment in subsidiaries 1,197 -
--------------------------------------------------------- -------------------- --------------------
Share of loss on equity accounted investees, net of tax (34,389) (7,077)
--------------------------------------------------------- -------------------- --------------------
Impairment loss on equity accounted investees (109,265) -
--------------------------------------------------------- -------------------- --------------------
Impairment loss on remeasurement of disposal groups (205) -
--------------------------------------------------------- -------------------- --------------------
Total non-operating losses (142,662) (7,077)
--------------------------------------------------------- -------------------- --------------------
Loss before taxation (163,310) (37,424)
--------------------------------------------------------- -------------------- --------------------
Taxation 319 (17)
--------------------------------------------------------- -------------------- --------------------
Loss for the period (162,991) (37,441)
--------------------------------------------------------- -------------------- --------------------
OTHER COMPREHENSIVE INCOME
--------------------------------------------------------- -------------------- --------------------
Items that will not be reclassified to profit or loss
--------------------------------------------------------- -------------------- --------------------
Share of revaluation on equity accounted investees 17 17
--------------------------------------------------------- -------------------- --------------------
17 17
--------------------------------------------------------- -------------------- --------------------
Items that are or may be reclassified to profit or loss
--------------------------------------------------------- -------------------- --------------------
Foreign currency translation differences (2,769) 12,137
--------------------------------------------------------- -------------------- --------------------
(2,769) 12,137
--------------------------------------------------------- -------------------- --------------------
Other comprehensive income for the period, net of tax (2,752) 12,154
--------------------------------------------------------- -------------------- --------------------
Total comprehensive income for the period (165,743) (25,287)
--------------------------------------------------------- -------------------- --------------------
Loss attributable to:
--------------------------------------------------------- -------------------- --------------------
Owners of the Company (162,417) (36,057)
--------------------------------------------------------- -------------------- --------------------
Non-controlling interests (574) (1,384)
--------------------------------------------------------- -------------------- --------------------
Loss for the period (162,991) (37,441)
--------------------------------------------------------- -------------------- --------------------
Total comprehensive income attributable to:
--------------------------------------------------------- -------------------- --------------------
Owners of the Company (164,589) (26,218)
--------------------------------------------------------- -------------------- --------------------
Non-controlling interests (1,154) 931
--------------------------------------------------------- -------------------- --------------------
Total comprehensive income for the period (165,743) (25,287)
--------------------------------------------------------- -------------------- --------------------
Loss per share
--------------------------------------------------------- -------------------- --------------------
Basic and diluted loss per share (EUR) (0.18) (0.05)
--------------------------------------------------------- -------------------- --------------------
.
The variation in NAV was mainly due to the reduction in the carrying value of Aristo by EUR35 million from the debt restructuring agreement reached with Bank of Cyprus in June 2016 and half year operating losses, as well as a further EUR109 million write-down of Aristo's carrying amount to reflect the agreed EUR45 million sales price. Further analysis of individual revenue and expense items is provided below.
-- Revenue
Revenues of EUR15.9 million (H1 2015: EUR8.1 million), were derived from the following sources:
H1 2016 H1 2015
EUR million EUR million
----------------------------------------- -------------- --------------
Income from hotel operations 7.9 3.2
Income from operation of golf
courses 0.1 0.0
Income from construction contracts 0.0 2.3
Sale of trading & investment properties 6.1 0.4
Rental income 0.1 0.2
Other income 1.7 2.0
TOTAL 15.9 8.1
-- Operating expenses
Operating expenses were EUR14.1 million (H1 2015: EUR13.0 million). The respective operating expenses are analysed in the following table:
H1 2016 H1 2015
EUR million EUR million
---------------------------------- -------------- --------------
Cost of sales related to:
Hotel operations 3.7 1.4
Golf course operations 0.1 0.2
Construction contracts 0.0 2.9
Sales of trading and investment
properties 3.8 0.2
Commission to agents and other 0.1 0.1
Concession/write off of land 0.0 2.0
Personnel expenses 4.7 3.7
Hotel management and branding
fees 1.4 2.3
Other operating expenses 0.3 0.2
TOTAL 14.1 13.0
The increase in Hotel Operations and Personnel expenses over the period is due to the opening of Amanera at the end of 2015. The expense relating to the sales of trading and investment properties, is attributable to the delivery of one Amanera villa and one Amanzoe plot to their respective buyers, which triggered the recognition of the corresponding revenue and expense (the carrying value of these properties) in DCI's financial statements.
-- Professional Fees
The majority of professional fees related to the design, appraisal, project management and development costs incurred by the Company on its property interests, which are expensed to profit or loss as incurred and not capitalized. The charge for the period was EUR4.1million (H1 2015: EUR3.7 million) and comprises the following:
H1 2016 H1 2015
EUR million EUR million
------------------------------------- -------------- --------------
Legal fees 0.5 0.4
Auditors' remuneration 0.2 0.2
Accounting expenses 0.1 0.1
Project design and development fees 2.3 1.9
Consultancy fees 0.4 0.3
Administrator fees 0.1 0.2
Other professional fees 0.5 0.6
------------------------------------- -------------- --------------
TOTAL 4.1 3.7
-- Administrative and other expenses
The administrative and other expenses amounted to EUR2.0 million (H1 2015: EUR3.5 million) and are analysed as follows:
H1 2016 H1 2015
EUR million EUR million
------------------------------------ -------------- --------------
Travelling 0.3 0.2
Insurance 0.1 0.1
Repairs and maintenance 0.1 0.1
Marketing and advertising expenses 0.4 0.4
Litigation liability provisions* 0.0 1.9
Rents 0.2 0.2
Other 0.9 0.6
------------------------------------ -------------- --------------
TOTAL 2.0 3.5
*EUR1.9 million relates to Zoniro (Greece) S.A. which was divested during 2015.
F.2. Condensed consolidated interim statement of financial position as at 30 June 2016
30 June 31 December
2016 2015
EUR'000 EUR'000
------------------------------------ --------- -----------
Assets
------------------------------------ --------- -----------
Property, plant and equipment 183,198 187,015
------------------------------------ --------- -----------
Investment property 338,105 340,853
------------------------------------ --------- -----------
Equity accounted investees 45,000 188,637
------------------------------------ --------- -----------
Available-for-sale financial assets 2,201 2,201
------------------------------------ --------- -----------
Deferred tax assets 996 997
------------------------------------ --------- -----------
Trade and other receivables 910 1,178
------------------------------------ --------- -----------
Non-current assets 570,410 720,881
------------------------------------ --------- -----------
Trading properties 35,070 37,387
------------------------------------ --------- -----------
Trade and other receivables 13,736 15,002
------------------------------------ --------- -----------
Cash and cash equivalents 11,238 41,990
------------------------------------ --------- -----------
Assets held for sale 69,379 70,240
------------------------------------ --------- -----------
Current assets 129,423 164,619
------------------------------------ --------- -----------
Total assets 699,833 885,500
==================================== ========= ===========
Equity
------------------------------------ --------- -----------
Share capital 9,046 9,046
------------------------------------ --------- -----------
Share premium 569,847 569,847
------------------------------------ --------- -----------
Retained deficit (283,813) (121,706)
==================================== ========= ===========
Other reserves 22,230 24,402
==================================== ========= ===========
Equity attributable to owners
of the Company 317,310 481,589
------------------------------------ --------- -----------
Non-controlling interests 33,931 34,939
------------------------------------ --------- -----------
Total equity 351,241 516,528
------------------------------------ --------- -----------
Liabilities
------------------------------------ --------- -----------
Loans and borrowings 190,567 191,152
------------------------------------ --------- -----------
Finance lease liabilities 2,945 2,956
------------------------------------ --------- -----------
Deferred tax liabilities 29,834 30,129
------------------------------------ --------- -----------
Trade and other payables 6,861 6,698
------------------------------------ --------- -----------
Deferred revenue 17,538 17,846
------------------------------------ --------- -----------
Non-current liabilities 247,745 248,781
------------------------------------ --------- -----------
Loans and borrowings 15,909 32,528
------------------------------------ --------- -----------
Finance lease liabilities 78 77
------------------------------------ --------- -----------
Trade and other payables 53,698 58,241
------------------------------------ --------- -----------
Deferred revenue 13,710 11,220
------------------------------------ --------- -----------
Liabilities held for sale 17,452 18,125
------------------------------------ --------- -----------
Current liabilities 100,847 120,191
------------------------------------ --------- -----------
Total liabilities 348,592 368,972
------------------------------------ --------- -----------
Total equity and liabilities 699,833 885,500
------------------------------------ --------- -----------
Net asset value ('NAV') per share
(EUR) 0.35 0.53
------------------------------------ --------- -----------
The reported NAV as at 30 June 2016 is presented below:
As at Variation since
30 June 2016 31 December 2015
EUR GBP EUR GBP
--------------------------------- -------- ------- ---------- ---------
Total NAV before DTL (million) 355 294 (34.8%) (26.8%)
--------------------------------- -------- ------- ---------- ---------
Total NAV after DTL (million) 317 262 (34.1%) (26.0%)
--------------------------------- -------- ------- ---------- ---------
NAV per share before DTL 0.39 0.32 (34.8%) (26.8%)
--------------------------------- -------- ------- ---------- ---------
NAV per share after DTL 0.35 0.29 (34.1%) (26.0%)
___________
Notes:
1. Euro/GBP rate 0.82718 as at 30 June 2016 and 0.73693 as at 31 December 2015.
2. Euro/USD rate 1.1102 as at 30 June 2016 and 1.0887 as at 31 December 2015.
3. NAV per share has been calculated on the basis of 904,626,856 issued shares as at 30 June 2016 and as at 31 December 2015.
Total Group NAV as at 30 June 2016 was EUR355 million and EUR317 million before and after DTL respectively. This represents a decrease of EUR190 million (34.8%) and EUR164 million (34.1%), respectively, from the respective 31 December 2015 figures. As no valuation of the Company's portfolio took place as at 30 June 2016, the NAV reduction is mainly due to the reduction in value of Aristo whose fair value has been adjusted to reflect the agreed EUR45 million sales price, Dolphin's regular operational, corporate, finance and management expenses, as well as the devaluation of the Americas properties in Euro terms due to the appreciation of the Euro against the US Dollar by c. 2%.
Sterling NAV per share as at 30 June 2016 was 32p before DTL and 29p after DTL and decreased by 26.8 % and 26.0 %, before and after DTL respectively compared to the 31 December 2015 figures. In addition to the factors mentioned above, the NAV per share was affected by a 12.3% appreciation of Euro versus the Sterling.
The Company's consolidated assets include EUR621 million of real estate assets (of which, EUR66 million are classified as assets held for sale), EUR45 million of investments in equity accounted investees (to reflect the agreed sale price of the Company's 49.8% interest in Aristo), EUR18 million of other assets (namely trade and other receivables and available for sale financial assets) and EUR11 million in cash.
The EUR621 million figure represents the fair market valuation of Dolphin's real estate portfolio for both freehold and long leasehold interests out of which the EUR66 million figure represents the appraised value of Sitia Bay, Livka Bay, LaVanta and Nikki Beach Resort which are currently classified as assets available for sale. The EUR15 million of trade and other receivables comprise mainly EUR3.4 million due from villa buyers and EUR3.3 million of VAT receivables. Available- for- sale financial assets represents the Company's investment in Itacare Investors Ltd.
The Company's consolidated liabilities (excluding DTL and EUR8 million DTL classified as liabilities held for sale) total EUR311 million and mainly comprise EUR218 million of interest-bearing loans and finance lease liabilities (of which, EUR8 million are classified as liabilities held for sale), out of which EUR50 million and US$9.17 million Convertible Bonds are held at Company level. The remaining loans are held by Group subsidiaries and are non-recourse to Dolphin (except for the Playa Grande construction loan which is guaranteed by the Company). The EUR92 million of trade and other payables and deferred revenue comprise mainly EUR26 million of option contracts to acquire land in the Company's Lavender Bay project, EUR7 million deferred income from government grants and EUR24 million of client advances from villa sales.
F.3. Condensed consolidated interim statement of changes in equity for the period ended 30 June 2016
Attributable to owners of the Company
----------------------------------------------------------------
Share Share Translation Revaluation Retained Non-controlling Total
capital premium reserve reserve deficit Total interests equity
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 1 January
2015 6,424 498,933 10,695 12,575 28,821 557,448 30,364 587,812
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TOTAL COMPREHENSIVE
INCOME
Loss - - - - (36,057) (36,057) (1,384) (37,441)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Other comprehensive
income
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Foreign currency
translation
differences - - 9,822 - - 9,822 2,315 12,137
======================== ======= ======= =========== =========== ========= ========= =============== =========
Share of revaluation on
equity accounted
investees - - - 17 - 17 - 17
======================== ======= ======= =========== =========== ========= ========= =============== =========
Total other
comprehensive income - - 9,822 17 - 9,839 2,315 12,154
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total comprehensive
income - - 9,822 17 (36,057) (26,218) 931 (25,287)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TRANSACTIONS WITH OWNERS
OF THE COMPANY
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Contributions by and
distributions
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Issue of ordinary shares 2,193 60,527 - - - 62,720 - 62,720
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Placement costs - (1,390) - - - (1,390) - (1,390)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Bond conversions 429 11,851 - - - 12,280 - 12,280
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Non-controlling
interests on capital
increases of
subsidiaries - - - - (545) (545) 545 -
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total contributions by
and distributions 2,622 70,988 - - (545) 73,065 545 73,610
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total transactions with
owners of the Company 2,622 70,988 - - (545) 73,065 545 73,610
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 30 June 2015 9,046 569,921 20,517 12,592 (7,781) 604,295 31,840 636,135
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 1 January
2016 9,046 569,847 23,939 463 (121,706) 481,589 34,939 516,528
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TOTAL COMPREHENSIVE
INCOME
Loss - - - - (162,417) (162,417) (574) (162,991)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Other comprehensive
income
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Foreign currency
translation
differences - - (2,189) - - (2,189) (580) (2,769)
======================== ======= ======= =========== =========== ========= ========= =============== =========
Share of revaluation on
equity accounted
investees - - - 17 - 17 - 17
======================== ======= ======= =========== =========== ========= ========= =============== =========
Total other
comprehensive income - - (2,189) 17 - (2,172) (580) (2,752)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total comprehensive
income - - (2,189) 17 (162,417) (164,589) (1,154) (165,743)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TRANSACTIONS WITH OWNERS
OF THE COMPANY
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Contributions and
distributions
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Equity-settled
share-based payment
arrangements - - - - 310 310 - 310
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total contributions and
distributions - - - - 310 310 - 310
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Changes in ownership
interests
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Movement in
non-controlling
interests - - - - - - 146 146
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total changes in
ownership interests - - - - - - 146 146
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total transactions with
owners of the Company - - - - 310 310 146 456
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 30 June 2016 9,046 569,847 21,750 480 (283,813) 317,310 33,931 351,241
======================== ======= ======= =========== =========== ========= ========= =============== =========
F.4. Consolidated statement of cash flows for the period ended 30 June 2016
From 1 January 2016 From 1 January 2015
to 30 June 2016 to 30 June 2015
EUR'000 EUR'000
------------------------------------------------------------- ------------------- -------------------
Cash flows from operating activities
------------------------------------------------------------- ------------------- -------------------
Loss (162,991) (37,441)
------------------------------------------------------------- ------------------- -------------------
Share of loss on equity accounted investees, net of tax 34,389 7,077
------------------------------------------------------------- ------------------- -------------------
Impairment loss on equity accounted investees 109,265 -
------------------------------------------------------------- ------------------- -------------------
Net change in fair value of investment property 11 96
------------------------------------------------------------- ------------------- -------------------
Impairment loss on remeasurement of disposal groups 205 -
------------------------------------------------------------- ------------------- -------------------
Gain on disposal of investment in subsidiaries (1.197) -
------------------------------------------------------------- ------------------- -------------------
Other adjustments 11,390 12,634
------------------------------------------------------------- ------------------- -------------------
(8,928) (17,634)
------------------------------------------------------------- ------------------- -------------------
Changes in:
------------------------------------------------------------- ------------------- -------------------
Receivables 1,533 1,571
------------------------------------------------------------- ------------------- -------------------
Payables (30) 20,942
------------------------------------------------------------- ------------------- -------------------
Cash (used in)/from operating activities (7,425) 4,879
------------------------------------------------------------- ------------------- -------------------
Tax received 66 77
------------------------------------------------------------- ------------------- -------------------
Net cash (used in)/from operating activities (7,359) 4,956
------------------------------------------------------------- ------------------- -------------------
Cash flows from investing activities
------------------------------------------------------------- ------------------- -------------------
Net (acquisitions)/disposals of investment property (11) 2,621
------------------------------------------------------------- ------------------- -------------------
Net acquisitions of property, plant and equipment (1,684) (13,900)
------------------------------------------------------------- ------------------- -------------------
Change in trading properties 2,707 (6,704)
============================================================= =================== ===================
Change in net assets held for sale 29 -
============================================================= =================== ===================
Change in equity accounted investees - (376)
============================================================= =================== ===================
Interest received 22 242
============================================================= =================== ===================
Net cash from/(used in) investing activities 1,063 (18,117)
------------------------------------------------------------- ------------------- -------------------
Cash flows from financing activities
------------------------------------------------------------- ------------------- -------------------
Proceeds from issue of share capital, net of placement costs - 61,330
------------------------------------------------------------- ------------------- -------------------
Change in loans and borrowings (18,273) 2,460
============================================================= =================== ===================
Change in finance lease liabilities (10) (256)
============================================================= =================== ===================
Interest paid (5,693) (5,960)
============================================================= =================== ===================
Net cash (used in)/from financing activities (23,976) 57,574
------------------------------------------------------------- ------------------- -------------------
Net (decrease)/increase in cash and cash equivalents (30,272) 44,413
------------------------------------------------------------- ------------------- -------------------
Cash and cash equivalents at the beginning of the period 41,990 28,739
------------------------------------------------------------- ------------------- -------------------
Effect of exchange rate fluctuations on cash held (480) (619)
------------------------------------------------------------- ------------------- -------------------
Cash and cash equivalents at the end of the period 11,238 72,533
------------------------------------------------------------- ------------------- -------------------
Condensed consolidated interim statement of profit or loss and other comprehensive income
For the six-month period ended 30 June 2016
From 1 January From 1 January
2016 2015
to 30 June to 30 June
2016 2015
Note EUR'000 EUR'000
------------------------------------------ ----- --------------- ---------------
Continuing operations
------------------------------------------ ----- --------------- ---------------
Revenue 6 15,877 8,073
------------------------------------------ ----- --------------- ---------------
Net change in fair value of investment
property 14 (11) (96)
------------------------------------------ ----- --------------- ---------------
Total operating profits 15,866 7,977
------------------------------------------ ----- --------------- ---------------
Operating expenses 7 (14,122) (13,007)
------------------------------------------ ----- --------------- ---------------
Investment Manager remuneration 28.2 (4,511) (6,814)
------------------------------------------ ----- --------------- ---------------
Directors' remuneration 28.1 (1,071) (304)
------------------------------------------ ----- --------------- ---------------
Depreciation charge 13 (1,401) (1,506)
------------------------------------------ ----- --------------- ---------------
Professional fees 9 (4,054) (3,728)
------------------------------------------ ----- --------------- ---------------
Administrative and other expenses 10 (1,965) (3,481)
------------------------------------------ ----- --------------- ---------------
Total operating and other expenses (27,124) (28,840)
------------------------------------------ ----- --------------- ---------------
Results from operating activities (11,258) (20,863)
------------------------------------------ ----- --------------- ---------------
Finance income 22 240
------------------------------------------ ----- --------------- ---------------
Finance costs (9,412) (9,724)
------------------------------------------ ----- --------------- ---------------
Net finance costs (9,390) (9,484)
------------------------------------------ ----- --------------- ---------------
Gain on disposal of investment
in subsidiaries 29 1,197 -
------------------------------------------ ----- --------------- ---------------
Share of loss on equity accounted
investees, net of tax 18 (34,389) (7,077)
------------------------------------------ ----- --------------- ---------------
Impairment loss on equity accounted
investees 18 (109,265) -
------------------------------------------ ----- --------------- ---------------
Impairment loss on remeasurement
of disposal groups 15 (205) -
------------------------------------------ ----- --------------- ---------------
Total non-operating losses (142,662) (7,077)
------------------------------------------ ----- --------------- ---------------
Loss before taxation (163,310) (37,424)
------------------------------------------ ----- --------------- ---------------
Taxation 11 319 (17)
------------------------------------------ ----- --------------- ---------------
Loss for the period (162,991) (37,441)
------------------------------------------ ----- --------------- ---------------
OTHER COMPREHENSIVE INCOME
------------------------------------------ ----- --------------- ---------------
Items that will not be reclassified
to profit or loss
------------------------------------------ ----- --------------- ---------------
Share of revaluation on equity
accounted investees 18 17 17
------------------------------------------ ----- --------------- ---------------
17 17
------------------------------------------ ----- --------------- ---------------
Items that are or may be reclassified
to profit or loss
------------------------------------------ ----- --------------- ---------------
Foreign currency translation differences (2,769) 12,137
------------------------------------------ ----- --------------- ---------------
(2,769) 12,137
------------------------------------------ ----- --------------- ---------------
Other comprehensive income for
the period, net of tax (2,752) 12,154
------------------------------------------ ----- --------------- ---------------
Total comprehensive income for
the period (165,743) (25,287)
------------------------------------------ ----- --------------- ---------------
Loss attributable to:
------------------------------------------ ----- --------------- ---------------
Owners of the Company (162,417) (36,057)
------------------------------------------ ----- --------------- ---------------
Non-controlling interests (574) (1,384)
------------------------------------------ ----- --------------- ---------------
Loss for the period (162,991) (37,441)
------------------------------------------ ----- --------------- ---------------
Total comprehensive income attributable
to:
------------------------------------------ ----- --------------- ---------------
Owners of the Company (164,589) (26,218)
------------------------------------------ ----- --------------- ---------------
Non-controlling interests (1,154) 931
------------------------------------------ ----- --------------- ---------------
Total comprehensive income for
the period (165,743) (25,287)
------------------------------------------ ----- --------------- ---------------
Loss per share
------------------------------------------ ----- --------------- ---------------
Basic and diluted loss per share
(EUR) 12 (0.18) (0.05)
------------------------------------------ ----- --------------- ---------------
Condensed consolidated interim statement of financial position
As at 30 June 2016
30 June 31 December
2016 2015
Note EUR'000 EUR'000
------------------------------------ ---- --------- -----------
Assets
------------------------------------ ---- --------- -----------
Property, plant and equipment 13 183,198 187,015
------------------------------------ ---- --------- -----------
Investment property 14 338,105 340,853
------------------------------------ ---- --------- -----------
Equity accounted investees 18 45,000 188,637
------------------------------------ ---- --------- -----------
Available-for-sale financial assets 17 2,201 2,201
------------------------------------ ---- --------- -----------
Deferred tax assets 24 996 997
------------------------------------ ---- --------- -----------
Trade and other receivables 19 910 1,178
------------------------------------ ---- --------- -----------
Non-current assets 570,410 720,881
------------------------------------ ---- --------- -----------
Trading properties 16 35,070 37,387
------------------------------------ ---- --------- -----------
Trade and other receivables 19 13,736 15,002
------------------------------------ ---- --------- -----------
Cash and cash equivalents 20 11,238 41,990
------------------------------------ ---- --------- -----------
Assets held for sale 15 69,379 70,240
------------------------------------ ---- --------- -----------
Current assets 129,423 164,619
------------------------------------ ---- --------- -----------
Total assets 699,833 885,500
==================================== ==== ========= ===========
Equity
------------------------------------ ---- --------- -----------
Share capital 21 9,046 9,046
------------------------------------ ---- --------- -----------
Share premium 21 569,847 569,847
------------------------------------ ---- --------- -----------
Retained deficit (283,813) (121,706)
==================================== ==== ========= ===========
Other reserves 22,230 24,402
==================================== ==== ========= ===========
Equity attributable to owners
of the Company 317,310 481,589
------------------------------------ ---- --------- -----------
Non-controlling interests 33,931 34,939
------------------------------------ ---- --------- -----------
Total equity 351,241 516,528
------------------------------------ ---- --------- -----------
Liabilities
------------------------------------ ---- --------- -----------
Loans and borrowings 22 190,567 191,152
------------------------------------ ---- --------- -----------
Finance lease liabilities 23 2,945 2,956
------------------------------------ ---- --------- -----------
Deferred tax liabilities 24 29,834 30,129
------------------------------------ ---- --------- -----------
Trade and other payables 26 6,861 6,698
------------------------------------ ---- --------- -----------
Deferred revenue 25 17,538 17,846
------------------------------------ ---- --------- -----------
Non-current liabilities 247,745 248,781
------------------------------------ ---- --------- -----------
Loans and borrowings 22 15,909 32,528
------------------------------------ ---- --------- -----------
Finance lease liabilities 23 78 77
------------------------------------ ---- --------- -----------
Trade and other payables 26 53,698 58,241
------------------------------------ ---- --------- -----------
Deferred revenue 25 13,710 11,220
------------------------------------ ---- --------- -----------
Liabilities held for sale 15 17,452 18,125
------------------------------------ ---- --------- -----------
Current liabilities 100,847 120,191
------------------------------------ ---- --------- -----------
Total liabilities 348,592 368,972
------------------------------------ ---- --------- -----------
Total equity and liabilities 699,833 885,500
------------------------------------ ---- --------- -----------
Net asset value ('NAV') per share
(EUR) 27 0.35 0.53
------------------------------------ ---- --------- -----------
Condensed consolidated interim statement of changes in equity
For the six-month period ended 30 June 2016
Attributable to owners of the
Company
----------------------------------------------------------------
Share Share Translation Revaluation Retained Non-controlling Total
capital premium reserve reserve deficit Total interests equity
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 1 January
2015 6,424 498,933 10,695 12,575 28,821 557,448 30,364 587,812
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TOTAL COMPREHENSIVE
INCOME
Loss - - - - (36,057) (36,057) (1,384) (37,441)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Other comprehensive
income
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Foreign currency
translation
differences - - 9,822 - - 9,822 2,315 12,137
======================== ======= ======= =========== =========== ========= ========= =============== =========
Share of revaluation
on equity accounted
investees - - - 17 - 17 - 17
======================== ======= ======= =========== =========== ========= ========= =============== =========
Total other
comprehensive
income - - 9,822 17 - 9,839 2,315 12,154
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total comprehensive
income - - 9,822 17 (36,057) (26,218) 931 (25,287)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TRANSACTIONS WITH OWNERS
OF THE COMPANY
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Contributions by and
distributions
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Issue of ordinary
shares 2,193 60,527 - - - 62,720 - 62,720
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Placement costs - (1,390) - - - (1,390) - (1,390)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Bond conversions 429 11,851 - - - 12,280 - 12,280
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Non-controlling
interests
on capital increases
of subsidiaries - - - - (545) (545) 545 -
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total contributions by
and distributions 2,622 70,988 - - (545) 73,065 545 73,610
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total transactions with
owners of the Company 2,622 70,988 - - (545) 73,065 545 73,610
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 30 June 2015 9,046 569,921 20,517 12,592 (7,781) 604,295 31,840 636,135
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 1 January
2016 9,046 569,847 23,939 463 (121,706) 481,589 34,939 516,528
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TOTAL COMPREHENSIVE
INCOME
Loss - - - - (162,417) (162,417) (574) (162,991)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Other comprehensive
income
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Foreign currency
translation
differences - - (2,189) - - (2,189) (580) (2,769)
======================== ======= ======= =========== =========== ========= ========= =============== =========
Share of revaluation
on equity accounted
investees - - - 17 - 17 - 17
======================== ======= ======= =========== =========== ========= ========= =============== =========
Total other
comprehensive
income - - (2,189) 17 - (2,172) (580) (2,752)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total comprehensive
income - - (2,189) 17 (162,417) (164,589) (1,154) (165,743)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TRANSACTIONS WITH OWNERS
OF THE COMPANY
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Contributions and
distributions
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Equity-settled
share-based
payment arrangements - - - - 310 310 - 310
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total contributions and
distributions - - - - 310 310 - 310
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Changes in ownership
interests
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Movement in
non-controlling
interests - - - - - - 146 146
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total changes in
ownership
interests - - - - - - 146 146
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total transactions with
owners of the Company - - - - 310 310 146 456
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 30 June 2016 9,046 569,847 21,750 480 (283,813) 317,310 33,931 351,241
======================== ======= ======= =========== =========== ========= ========= =============== =========
Condensed consolidated interim statement of cash flows
For the six-month period ended 30 June 2016
From 1 January From 1 January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
--------------------------------------- -------------- --------------
Cash flows from operating activities
--------------------------------------- -------------- --------------
Loss (162,991) (37,441)
---------------------------------------- -------------- --------------
Share of loss on equity accounted
investees, net of tax 34,389 7,077
---------------------------------------- -------------- --------------
Impairment loss on equity accounted
investees 109,265 -
---------------------------------------- -------------- --------------
Net change in fair value of investment
property 11 96
---------------------------------------- -------------- --------------
Impairment loss on remeasurement
of disposal groups 205 -
---------------------------------------- -------------- --------------
Gain on disposal of investment
in subsidiaries (1,197) -
---------------------------------------- -------------- --------------
Other adjustments 11,390 12,634
---------------------------------------- -------------- --------------
(8,928) (17,634)
--------------------------------------- -------------- --------------
Changes in:
--------------------------------------- -------------- --------------
Receivables 1,533 1,571
---------------------------------------- -------------- --------------
Payables (30) 20,942
---------------------------------------- -------------- --------------
Cash (used in)/from operating
activities (7,425) 4,879
---------------------------------------- -------------- --------------
Tax received 66 77
---------------------------------------- -------------- --------------
Net cash (used in)/from operating
activities (7,359) 4,956
---------------------------------------- -------------- --------------
Cash flows from investing activities
--------------------------------------- -------------- --------------
Net (acquisitions)/disposals
of investment property (11) 2,621
---------------------------------------- -------------- --------------
Net acquisitions of property,
plant and equipment (1,684) (13,900)
---------------------------------------- -------------- --------------
Change in trading properties 2,707 (6,704)
---------------------------------------- -------------- --------------
Change in net assets held for
sale 29 -
---------------------------------------- -------------- --------------
Change in equity accounted investees - (376)
======================================== ============== ==============
Interest received 22 242
======================================== ============== ==============
Net cash from/(used in) investing
activities 1,063 (18,117)
---------------------------------------- -------------- --------------
Cash flows from financing activities
--------------------------------------- -------------- --------------
Proceeds from issue of share
capital, net of placement costs - 61,330
---------------------------------------- -------------- --------------
Change in loans and borrowings (18,273) 2,460
======================================== ============== ==============
Change in finance lease liabilities (10) (256)
======================================== ============== ==============
Interest paid (5,693) (5,960)
======================================== ============== ==============
Net cash (used in)/from financing
activities (23,976) 57,574
---------------------------------------- -------------- --------------
Net (decrease)/increase in cash
and cash equivalents (30,272) 44,413
---------------------------------------- -------------- --------------
Cash and cash equivalents at
the beginning of the period 41,990 28,739
---------------------------------------- -------------- --------------
Effect of exchange rate fluctuations
on cash held (480) (619)
---------------------------------------- -------------- --------------
Cash and cash equivalents at
the end of the period 11,238 72,533
---------------------------------------- -------------- --------------
For the purpose of the condensed
consolidated interim statement
of cash flows, cash and cash
equivalents consist of the following:
--------------------------------------- -------------- --------------
Cash in hand and at bank (see
note 20) 11,238 74,820
---------------------------------------- -------------- --------------
Bank overdrafts - (2,287)
---------------------------------------- -------------- --------------
Cash and cash equivalents at
the end of the period 11,238 72,533
---------------------------------------- -------------- --------------
Notes to the condensed consolidated interim financial statements
1. REPORTING ENTITY
Dolphin Capital Investors Limited (the 'Company') was incorporated and registered in the British Virgin Islands ('BVIs') on 7 June 2005. The Company is a real estate investment company focused on the early-stage, large-scale leisure-integrated residential resorts in south-east Europe and the Americas, and managed by Dolphin Capital Partners Limited (the 'Investment Manager'), an independent private equity management firm that specialises in real estate investments, primarily in south-east Europe. The shares of the Company were admitted to trading on the AIM market of the London Stock Exchange ('AIM') on 8 December 2005.
The condensed consolidated interim financial statements of the Company as at and for the six-month period ended 30 June 2016 comprise the financial statements of the Company and its subsidiaries (together referred to as the 'Group') and the Group's interests in associates.
The condensed consolidated interim financial statements of the Group as at and for the six-month period ended 30 June 2016 are available at www.dolphinci.com.
2. STATEMENT OF COMPLIANCE
These condensed consolidated interim financial statements have been prepared in accordance with IAS 34 'Interim Financial Reporting'. They do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Group as at and for the year ended 31 December 2015. They are presented in euro (EUR), rounded to the nearest thousand.
These condensed consolidated interim financial statements were authorised for issue by the Board of Directors on 29 September 2016.
3. SIGNIFICANT ACCOUNTING POLICIES
The accounting policies applied by the Group in these condensed consolidated interim financial statements are the same as those applied by the Group in its consolidated financial statements as at and for the year ended 31 December 2015.
4. ESTIMATES
The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation and uncertainty were the same as those applied to the consolidated financial statements as at and for the year ended 31 December 2015.
5. PRINCIPAL SUBSIDIARIES
As at 30 June 2016, the Group's most significant subsidiaries were the following:
Country of Shareholding
Name Project incorporation interest
---------------------------------- --------------------- ----------------- -------------
Scorpio Bay
Scorpio Bay Holdings Limited Resort Cyprus 100%
================================== ===================== ================= =============
Scorpio Bay
Scorpio Bay Resorts S.A. Resort Greece 100%
================================== ===================== ================= =============
Sitia Bay Golf
Latirus Enterprises Limited Resort Cyprus 80%
================================== ===================== ================= =============
Iktinos Techniki Touristiki Sitia Bay Golf
S.A. ('Iktinos') Resort Greece 78%
================================== ===================== ================= =============
Lavender Bay
Xscape Limited Resort Cyprus 100%
================================== ===================== ================= =============
Lavender Bay
Golfing Developments S.A. Resort Greece 100%
================================== ===================== ================= =============
Kilada Hills
MindCompass Overseas Limited Golf Resort Cyprus 100%
================================== ===================== ================= =============
Kilada Hills
MindCompass Overseas S.A. Golf Resort Greece 100%
================================== ===================== ================= =============
Kilada Hills
MindCompass Overseas Two S.A. Golf Resort Greece 100%
================================== ===================== ================= =============
Kilada Hills
MindCompass Parks S.A. Golf Resort Greece 100%
================================== ===================== ================= =============
Dolphin Capital Greek Collection Kilada Hills
Limited Golf Resort Cyprus 100%
================================== ===================== ================= =============
DCI Holdings One Limited ('DCI
H1') Aristo Developers BVIs 100%
================================== ===================== ================= =============
D.C. Apollo Heights Polo and Apollo Heights
Country Resort Limited Resort Cyprus 100%
================================== ===================== ================= =============
Apollo Heights
Symboula Estates Limited Resort Cyprus 100%
================================== ===================== ================= =============
DolphinCI Fourteen Limited
('DCI 14') Amanzoe Cyprus 100%
================================== ===================== ================= =============
Eidikou Skopou Dekatessera
S.A. ('ES 14') Amanzoe Greece 100%
================================== ===================== ================= =============
Eidikou Skopou Dekaokto S.A.
('ES 18') Amanzoe Greece 100%
================================== ===================== ================= =============
Single Purpose Vehicle Two
Limited ('SPV 2') Amanzoe Cyprus 64%
================================== ===================== ================= =============
Eidikou Skopou Eikosi Ena
S.A. Amanzoe Greece 64%
================================== ===================== ================= =============
Azurna Uvala D.o.o. ('Azurna') Livka Bay Resort Croatia 100%
================================== ===================== ================= =============
Eastern Crete Development
Company S.A. Plaka Bay Resort Greece 100%
================================== ===================== ================= =============
La Vanta- Mediterra
DolphinLux 2 S.a.r.l. Resorts Luxembourg 100%
================================== ===================== ================= =============
Kalkan Yapi ve Turizm A.S. La Vanta- Mediterra
('Kalkan') Resorts Turkey 100%
================================== ===================== ================= =============
Pearl Island
and Playa Grande
Dolphin Capital Americas Limited Club & Reserve BVIs 100%
================================== ===================== ================= =============
DCA Pearl Holdings Limited Pearl Island BVIs 100%
================================== ===================== ================= =============
Playa Grande
DCA Holdings Six Limited Club & Reserve BVIs 100%
================================== ===================== ================= =============
Playa Grande
DCA Holdings Seven Limited Club & Reserve BVIs 100%
================================== ===================== ================= =============
Playa Grande Holdings Inc. Playa Grande
('PGH') Club & Reserve BVIs 100%
================================== ===================== ================= =============
Single Purpose Vehicle Eight
Limited Triopetra Cyprus 100%
================================== ===================== ================= =============
Eidikou Skopou Dekapente S.A. Triopetra Greece 100%
================================== ===================== ================= =============
Single Purpose Vehicle Ten
Limited ('SPV 10') Kea Resort Cyprus 67%
================================== ===================== ================= =============
Eidikou Skopou Eikosi Tessera
S.A. Kea Resort Greece 67%
================================== ===================== ================= =============
Pearl Island Limited S.A. Pearl Island Panama Republic 60%
================================== ===================== ================= =============
Zoniro (Panama) S.A. Pearl Island Panama Republic 60%
================================== ===================== ================= =============
The above shareholding interest percentages are rounded to the nearest integer.
As at 30 June 2016 and 31 December 2015, all or part of the shares held by the Company in some of its subsidiaries are pledged as a security for loans.
6. revenue
From 1 From 1
January January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
------------------------------------------- ------------ ------------
Income from hotel operations 7,901 3,187
------------------------------------------- ------------ ------------
Income from operation of golf courses 125 12
------------------------------------------- ------------ ------------
Income from construction contracts - 2,273
------------------------------------------- ------------ ------------
Sale of trading and investment properties 6,095 427
------------------------------------------- ------------ ------------
Rental income 52 247
------------------------------------------- ------------ ------------
Other income 1,704 1,927
------------------------------------------- ------------ ------------
Total 15,877 8,073
------------------------------------------- ------------ ------------
7. OPERATING EXPENSES
From 1 From 1
January January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
--------------------------------------------- ------------ ------------
Cost of sales related to:
--------------------------------------------- ------------ ------------
Hotel operations 3,743 1,402
--------------------------------------------- ------------ ------------
Golf course operations 143 179
--------------------------------------------- ------------ ------------
Construction contracts - 2,851
--------------------------------------------- ------------ ------------
Sales of trading and investment properties 3,755 217
--------------------------------------------- ------------ ------------
Commission to agents and other 57 64
--------------------------------------------- ------------ ------------
Concession/write off of land - 2,066
--------------------------------------------- ------------ ------------
Personnel expenses (see below) 4,738 3,660
--------------------------------------------- ------------ ------------
Hotel operator fees 181 162
--------------------------------------------- ------------ ------------
Branding management fees 1,189 2,108
--------------------------------------------- ------------ ------------
Other operating expenses 316 298
--------------------------------------------- ------------ ------------
Total 14,122 13,007
--------------------------------------------- ------------ ------------
Personnel expenses
From 1 January 2016
to 30 June 2016
=========================================================
Project
Hotel maintenance Construction
& leisure & development Total in progress
operations
EUR'000 EUR'000 EUR'000 EUR'000
--------------------------------- ------------- --------------- -------- ---------------
Wages and salaries 2,243 1,312 3,555 -
--------------------------------- ------------- --------------- -------- ---------------
Compulsory social security
contributions 436 216 652 -
--------------------------------- ------------- --------------- -------- ---------------
Contributions to defined
contribution plans - 24 24 -
--------------------------------- ------------- --------------- -------- ---------------
Other personnel costs 437 70 507 -
--------------------------------- ------------- --------------- -------- ---------------
Total 3,116 1,622 4,738 -
--------------------------------- ------------- --------------- -------- ---------------
The average number of employees
employed by the Group during
the period was 397 140 537 -
--------------------------------- ------------- --------------- -------- ---------------
From 1 January 2015
to 30 June 2015
=========================================================
Project
Hotel maintenance Construction
& leisure & development Total in progress
operations
EUR'000 EUR'000 EUR'000 EUR'000
--------------------------------- ------------- --------------- -------- ---------------
Wages and salaries 1,430 1,376 2,806 74
--------------------------------- ------------- --------------- -------- ---------------
Compulsory social security
contributions 339 258 597 3
--------------------------------- ------------- --------------- -------- ---------------
Contributions to defined
contribution plans - 20 20 -
--------------------------------- ------------- --------------- -------- ---------------
Other personnel costs 127 110 237 -
--------------------------------- ------------- --------------- -------- ---------------
Total 1,896 1,764 3,660 77
--------------------------------- ------------- --------------- -------- ---------------
The average number of employees
employed by the Group during
the period was 204 161 365 2
--------------------------------- ------------- --------------- -------- ---------------
Personnel expenses in relation to operating expenses are expensed as incurred in profit or loss. Personnel expenses in relation to construction in progress are capitalised on the specific projects and transferred to profit or loss through cost of sales when the specific property is disposed of.
8. Segment reporting
Operating segments
The Group has two reportable operating segments, the 'Hotel & leisure operations' and 'Construction & development' segments. Information related to each operational reportable segment is set out below. Segment profit/(loss) before tax is used to measure performance as management believes such information is the most relevant in evaluating the results of the respective segments relative to other entities that operate in the same industries.
Reportable
Hotel Construction segments'
& leisure & development Other totals
operations
EUR'000 EUR'000 EUR'000 EUR'000
------------------------------------- ------------- ---------------- --------- -----------
30 June 2016
------------------------------------- ------------- ---------------- --------- -----------
Revenue 8,027 6,102 1,748 15,877
------------------------------------- ------------- ---------------- --------- -----------
Net change in fair value of
investment property - - (11) (11)
------------------------------------- ------------- ---------------- --------- -----------
Operating expenses (8,433) (5,298) (391) (14,122)
------------------------------------- ------------- ---------------- --------- -----------
Investment Manager remuneration - - (4,511) (4,511)
------------------------------------- ------------- ---------------- --------- -----------
Directors' remuneration - - (1,071) (1,071)
------------------------------------- ------------- ---------------- --------- -----------
Depreciation charge (1,218) (183) - (1,401)
------------------------------------- ------------- ---------------- --------- -----------
Professional fees - (1,236) (2,818) (4,054)
------------------------------------- ------------- ---------------- --------- -----------
Administrative and other expenses - (285) (1,680) (1,965)
------------------------------------- ------------- ---------------- --------- -----------
Results from operating activities (1,624) (900) (8,734) (11,258)
------------------------------------- ------------- ---------------- --------- -----------
Finance income - - 22 22
------------------------------------- ------------- ---------------- --------- -----------
Finance costs (3,673) (246) (5,493) (9,412)
------------------------------------- ------------- ---------------- --------- -----------
Net finance costs (3,673) (246) (5,471) (9,390)
------------------------------------- ------------- ---------------- --------- -----------
Share of loss on equity-accounted
investees, net of tax - (34,389) - (34,389)
------------------------------------- ------------- ---------------- --------- -----------
Gain on disposal of investment
in subsidiaries - 1,197 - 1,197
------------------------------------- ------------- ---------------- --------- -----------
Impairment loss on equity accounted
investees - (109,265) - (109,265)
------------------------------------- ------------- ---------------- --------- -----------
Impairment loss on remeasurement
of disposal groups - (205) - (205)
------------------------------------- ------------- ---------------- --------- -----------
Loss before tax (5,297) (143,808) (14,205) (163,310)
------------------------------------- ------------- ---------------- --------- -----------
Taxation - 46 273 319
------------------------------------- ------------- ---------------- --------- -----------
Loss (5,297) (143,762) (13,932) (162,991)
------------------------------------- ------------- ---------------- --------- -----------
Reportable
Hotel Construction segments'
& leisure & development Other totals
operations
EUR'000 EUR'000 EUR'000 EUR'000
----------------------------------- ------------- ---------------- --------- -----------
30 June 2015
----------------------------------- ------------- ---------------- --------- -----------
Revenue 3,199 2,928 1,946 8,073
----------------------------------- ------------- ---------------- --------- -----------
Net change in fair value of
investment property - - (96) (96) ----------------------------------- ------------- ---------------- --------- ----------- Operating expenses (3,724) (7,507) (1,776) (13,007) ----------------------------------- ------------- ---------------- --------- ----------- Investment Manager remuneration - - (6,814) (6,814) ----------------------------------- ------------- ---------------- --------- ----------- Directors' remuneration - - (304) (304) ----------------------------------- ------------- ---------------- --------- ----------- Depreciation charge (1,173) (239) (94) (1,506) ----------------------------------- ------------- ---------------- --------- ----------- Professional fees - (1,970) (1,758) (3,728) ----------------------------------- ------------- ---------------- --------- ----------- Administrative and other expenses - (2,911) (570) (3,481) ----------------------------------- ------------- ---------------- --------- ----------- Results from operating activities (1,698) (9,699) (9,466) (20,863) ----------------------------------- ------------- ---------------- --------- ----------- Finance income - 238 2 240 ----------------------------------- ------------- ---------------- --------- ----------- Finance costs (1,822) (1,790) (6,112) (9,724) ----------------------------------- ------------- ---------------- --------- ----------- Net finance costs (1,822) (1,552) (6,110) (9,484) ----------------------------------- ------------- ---------------- --------- ----------- Share of loss on equity-accounted investees, net of tax (1,007) (6,070) - (7,077) ----------------------------------- ------------- ---------------- --------- ----------- Loss before tax (4,527) (17,321) (15,576) (37,424) ----------------------------------- ------------- ---------------- --------- ----------- Taxation - (111) 94 (17) ----------------------------------- ------------- ---------------- --------- ----------- Loss (4,527) (17,432) (15,482) (37,441) ----------------------------------- ------------- ---------------- --------- -----------
Geographical segments
Information in relation to the geographical regions in which the Group operates, is set below:
Reportable
South-East segment Consolidated
Americas(1) Europe(2) Other(3) totals Adjustments(4) totals
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
30 June 2016
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Property, plant and equipment 100,195 83,003 - 183,198 - 183,198
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Investment property 139,158 198,947 - 338,105 - 338,105
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Trading properties 3,086 31,984 - 35,070 - 35,070
================================ =========== ========== ======== ========== ============== ============
Equity accounted investees - 45,000 - 45,000 - 45,000
================================ =========== ========== ======== ========== ============== ============
Available-for-sale financial
assets 2,201 - - 2,201 - 2,201
================================ =========== ========== ======== ========== ============== ============
Cash and cash equivalents 2,305 6,792 2,141 11,238 - 11,238
================================ =========== ========== ======== ========== ============== ============
Assets held for sale - 69,379 - 69,379 - 69,379
================================ =========== ========== ======== ========== ============== ============
Intra-group debit balances 14,513 51,888 578,810 645,211 (645,211) -
================================ =========== ========== ======== ========== ============== ============
Other assets 5,068 10,382 192 15,642 - 15,642
================================ =========== ========== ======== ========== ============== ============
Total assets 266,526 497,375 581,143 1,345,044 (645,211) 699,833
================================ =========== ========== ======== ========== ============== ============
Loans and borrowings 54,926 93,290 58,260 206,476 - 206,476
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Finance lease liabilities 5 3,018 - 3,023 - 3,023
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Deferred tax liabilities 2,385 27,449 - 29,834 - 29,834
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Liabilities held for sale - 17,452 - 17,452 - 17,452
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Intra-group credit balances 163,996 421,339 59,876 645,211 (645,211) -
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Other liabilities 26,901 64,122 784 91,807 - 91,807
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Total liabilities 248,213 626,670 118,920 993,803 (645,211) 348,592
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Revenue 9,554 6,323 - 15,877 - 15,877
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Net change in fair value
of investment property (11) - - (11) - (11)
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Share of loss on equity
accounted investees, net
of tax - (34,389) - (34,389) - (34,389)
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Impairment loss on equity
accounted investees - (109,265) (109,265) (109,265)
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Other non-operating profits - 992 - 992 - 992
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Investment Manager remuneration - (640) (3,871) (4,511) - (4,511)
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Net finance costs (2,397) (5,006) (1,987) (9,390) - (9,390)
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Other expenses (9,479) (10,113) (3,021) (22,613) - (22,613)
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Loss before taxation (2,333) (152,098) (8,879) (163,310) - (163,310)
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Taxation - 319 - 319 - 319
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Loss (2,333) (151,779) (8,879) (162,991) - (162,991)
-------------------------------- ----------- ---------- -------- ---------- -------------- ------------
Reportable
South-East segment Consolidated
Americas(1) Europe(2) Other(3) totals Adjustments(4) totals
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
31 December 2015
---------------------------------------------------------------------------------------------------------------
Property, plant and equipment 102,920 84,095 - 187,015 - 187,015
================================= =========== ========== ========= ========== ============== ============
Investment property 141,906 198,947 - 340,853 - 340,853
================================= =========== ========== ========= ========== ============== ============
Trading properties 2,052 35,335 - 37,387 - 37,387
================================= =========== ========== ========= ========== ============== ============
Equity accounted investees - 188,637 - 188,637 - 188,637
================================= =========== ========== ========= ========== ============== ============
Available-for-sale financial
assets 2,201 - - 2,201 - 2,201
================================= =========== ========== ========= ========== ============== ============
Cash and cash equivalents 2,117 6,218 33,655 41,990 - 41,990
================================= =========== ========== ========= ========== ============== ============
Assets held for sale - 70,240 - 70,240 - 70,240
================================= =========== ========== ========= ========== ============== ============
Intra-group debit balances 14,195 291,448 555,516 861,159 (861,159) -
================================= =========== ========== ========= ========== ============== ============
Other assets 3,141 13,195 841 17,177 - 17,177
================================= =========== ========== ========= ========== ============== ============
Total assets 268,532 888,115 590,012 1,746,659 (861,159) 885,500
================================= =========== ========== ========= ========== ============== ============
Loans and borrowings 57,550 92,395 73,735 223,680 - 223,680
================================= =========== ========== ========= ========== ============== ============
Finance lease liabilities 28 3,005 - 3,033 - 3,033
================================= =========== ========== ========= ========== ============== ============
Deferred tax liabilities 2,432 27,697 - 30,129 - 30,129
================================= =========== ========== ========= ========== ============== ============
Liabilities held for sale - 18,125 - 18,125 - 18,125
================================= =========== ========== ========= ========== ============== ============
Intra-group credit balances 144,154 417,371 299,634 861,159 (861,159) -
================================= =========== ========== ========= ========== ============== ============
Other liabilities 27,865 65,260 880 94,005 - 94,005
================================= =========== ========== ========= ========== ============== ============
Total liabilities 232,029 623,853 374,249 1,230,131 (861,159) 368,972
================================= =========== ========== ========= ========== ============== ============
30 June 2015
Revenue 1,622 6,367 84 8,073 8,073
================================= =========== ========== ========= ========== ============== ============
Net change in fair value
of investment property (80) (16) - (96) - (96)
================================= =========== ========== ========= ========== ============== ============
Share of loss on equity
accounted investees, net
of tax - (6,070) (1,007) (7,077) - (7,077)
================================= =========== ========== ========= ========== ============== ============
Investment Manager remuneration - - (6,814) (6,814) - (6,814)
================================= =========== ========== ========= ========== ============== ============
Net finance costs (1,494) (5,109) (2,881) (9,484) - (9,484)
================================= =========== ========== ========= ========== ============== ============
Other expenses (4,562) (16,727) (737) (22,026) - (22,026)
================================= =========== ========== ========= ========== ============== ============
Loss before taxation (4,514) (21,555) (11,355) (37,424) - (37,424)
================================= =========== ========== ========= ========== ============== ============
Taxation 14 (31) - (17) - (17)
================================= =========== ========== ========= ========== ============== ============
Loss (4,500) (21,586) (11,355) (37,441) - (37,441)
================================= =========== ========== ========= ========== ============== ============
1 Americas comprises the Group's activities in the Dominican Republic and the Republic of Panama. Also, includes the investment in Itacare Capital Investments Ltd ('Itacare') (see note 17).
2 South-East Europe comprises the Group's activities in Cyprus, Greece, Croatia and Turkey.
3 Other comprises the parent company, Dolphin Capital Investors Limited.
4 Adjustments consist of intra-group eliminations.
Country risk developments
The general economic environment prevailing in the south-east Europe area and internationally may affect the Group's operations. Factors such as inflation, unemployment, public health crises, international trade and development of the gross domestic product directly impact the economy of each country and variation in these and the economic environment in general affect the Group's performance to a certain extent.
The global fundamentals of the sector remained strong during 2015 and the first half 2016, with both international tourism and wealth continuing to grow, even though economic activity in two of the Group's primary markets, Greece and Cyprus, continued to face significant challenges. The business climate is steadily improving in Cyprus assisted by the legislative reforms implemented during the last two years by the Cypriot government.
Greece
After the escalation of the sovereign debt crisis in Greece in mid-2012 and further in late June 2015, when capital controls were imposed and the banking system was closed for more than two weeks, on 15 July 2015, the Greek parliament passed a law including a list of reforms that the Greek Government needed to implement in order to unlock a fresh EUR82 billion to EUR86 billion bail-out. The conclusion of this agreement and its implementation by the Greek Government so far, is expected to restore the sustainability of the Greek economy on a long term basis. Since the announcement of the provisional agreement for the third bail out, reservations picked up again and official data released by the Bank of Greece confirmed that 2015 was an all-time record year for Greek tourism. The number of tourism arrivals in Greece expanded 7.1% in 2015 compared to 2014, reaching an all-time high of 23.6 million.
In 2016, for the period between January and July, international arrivals rose by 6.4% against the same period last year. The Greek Tourism Confederation noted that the surge in last-minute bookings means that there is a strong likelihood that the target which the Confederation set at the start of the year, for an increase of 6% in arrivals over the course of the whole year, can be achieved.
Cyprus
Cyprus successfully concluded its three-year European Stability Mechanism ("ESM") financial assistance programme on 31 March 2016. The ESM disbursed EUR6.3 billion, in addition to around EUR1 billion in loans from the IMF, out of a loan package of up to EUR10 billion. The Cypriot authorities did not need the remaining EUR2.7 billion.
In 2016, for the period January - July 2016, arrivals of tourists totalled 1.74 million compared to 1.45 million in the corresponding period of 2015, recording an increase of 20% as reported by the country's Statistical Service. The last estimate for the 2016 tourist arrivals is 3.1 million compared with 2.65 million in 2015 and 2.7 million in 2001 which was the last record year.
Significant value is also estimated to be unlocked through the expected zoning of DCI's Apollo Heights Resort, following the agreement reached by the Cypriot and UK governments to permit development of such projects falling within the Sovereign British Areas.
9. PROFESSIONAL FEES
From 1 From 1
January January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
---------------------------------------- ------------ ------------
Legal fees 496 360
---------------------------------------- ------------ ------------
Auditors' remuneration (see below) 212 226
---------------------------------------- ------------ ------------
Accounting expenses 142 136
---------------------------------------- ------------ ------------
Project design and development fees 2,270 1,962
---------------------------------------- ------------ ------------
Consultancy fees 400 284
---------------------------------------- ------------ ------------
Administrator fees 120 157
---------------------------------------- ------------ ------------
Other professional fees 414 603
---------------------------------------- ------------ ------------
Total 4,054 3,728
---------------------------------------- ------------ ------------
From 1 From 1
January January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
---------------------------------------- ------------ ------------
Auditors' remuneration comprises the
following fees:
---------------------------------------- ------------ ------------
Audit and other audit related services 180 226
---------------------------------------- ------------ ------------
Tax and advisory 32 -
---------------------------------------- ------------ ------------
Total 212 226
---------------------------------------- ------------ ------------
10. ADMINISTRATIVE AND OTHER EXPENSES
From 1 From 1
January January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
------------------------------------ ------------ ------------
Travelling 274 165
------------------------------------ ------------ ------------
Insurance 58 66
------------------------------------ ------------ ------------
Repairs and maintenance 128 93
------------------------------------ ------------ ------------
Marketing and advertising expenses 381 434
------------------------------------ ------------ ------------
Litigation liability provisions - 1,922
------------------------------------ ------------ ------------
Rents 175 188
------------------------------------ ------------ ------------
Other 949 613
------------------------------------ ------------ ------------
Total 1,965 3,481
------------------------------------ ------------ ------------
11. Taxation
From 1 January From 1 January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
---------------------------------------------- -------------- --------------
Income tax (43) 26
---------------------------------------------- -------------- --------------
Deferred tax (230) (9)
---------------------------------------------- -------------- --------------
Deferred tax relating to disposal groups held
for sale (46) -
---------------------------------------------- -------------- --------------
Total (319) 17
---------------------------------------------- -------------- --------------
12. LOSS per share
Basic loss per share
Basic loss per share is calculated by dividing the loss attributable to owners of the Company by the weighted average number of common shares outstanding during the period.
From 1 January From 1 January
2016 2015
to 30 June to 30 June
2016 2015
'000 '000
------------------------------------------- -------------- --------------
Loss attributable to owners of the Company
(EUR) (162,417) (36,057)
------------------------------------------- -------------- --------------
Number of weighted average common shares
outstanding 904,627 671,174
------------------------------------------- -------------- --------------
Basic loss per share (EUR) (0.18) (0.05)
------------------------------------------- -------------- --------------
Weighted average number of common shares outstanding
From 1 January From 1 January
2016 to 2015 to
30 June 30 June
2016 2015
'000 '000
------------------------------------------ -------------- --------------
Outstanding common shares at beginning
of period 904,627 642,440
------------------------------------------ -------------- --------------
Effect of shares issued during the period - 24,227
------------------------------------------ -------------- --------------
Effect of Bond Conversion shares - 4,507
------------------------------------------ -------------- --------------
Weighted average number of common shares
outstanding 904,627 671,174
------------------------------------------ -------------- --------------
Diluted loss per share
Diluted loss per share is calculated by adjusting the loss attributable to owners and the number of common shares outstanding to assume conversion of all dilutive potential shares. As of 30 June 2016 and 31 December 2015, the diluted loss per share is the same as the basic loss per share, due to the fact that no dilutive potential ordinary shares were outstanding during these periods.
The average market value of the Company's shares for the purpose of calculating the dilutive effect of warrants and convertible bonds was based on quoted market prices.
13. Property, plant and equipment
Under construction Land, buildings
EUR'000 and other Total
EUR'000 EUR'000
30 June 2016
--------------------------------------------- ------------------- ---------------- ----------
Cost or revalued amount
--------------------------------------------- ------------------- ---------------- ----------
At beginning of period 12,227 206,935 219,162
--------------------------------------------- ------------------- ---------------- ----------
Direct acquisitions 708 1,095 1,803
--------------------------------------------- ------------------- ---------------- ----------
Direct disposals - (133) (133)
--------------------------------------------- ------------------- ---------------- ----------
Transfers to trading property (see note 16) - (2,029) (2,029)
--------------------------------------------- ------------------- ---------------- ----------
Exchange difference (222) (1,941) (2,163)
--------------------------------------------- ------------------- ---------------- ----------
At end of period 12,713 203,927 216,640
--------------------------------------------- ------------------- ---------------- ----------
Depreciation and impairment losses
--------------------------------------------- ------------------- ---------------- ----------
At beginning of period - 32,147 32,147
--------------------------------------------- ------------------- ---------------- ----------
Direct disposals - (14) (14)
--------------------------------------------- ------------------- ---------------- ----------
Depreciation charge for the period - 1,401 1,401
--------------------------------------------- ------------------- ---------------- ----------
Exchange difference - (92) (92)
--------------------------------------------- ------------------- ---------------- ----------
At end of period - 33,442 33,442
--------------------------------------------- ------------------- ---------------- ----------
Carrying amounts 12,713 170,485 183,198
--------------------------------------------- ------------------- ---------------- ----------
Under construction Land, buildings
EUR'000 and other Total
EUR'000 EUR'000
31 December 2015
-------------------------------------------------- --------------------- ------------------ ----------
Cost or revalued amount
-------------------------------------------------- --------------------- ------------------ ----------
At beginning of year 31,273 163,019 194,292
-------------------------------------------------- --------------------- ------------------ ----------
Direct acquisitions 35,483 7,090 42,573
-------------------------------------------------- --------------------- ------------------ ----------
Direct disposals - (1,063) (1,063)
-------------------------------------------------- --------------------- ------------------ ----------
Disposals through disposal of subsidiary company - (1,581) (1,581)
-------------------------------------------------- --------------------- ------------------ ----------
Reclassification to assets held for sale - (5,505) (5,505)
-------------------------------------------------- --------------------- ------------------ ----------
Transfers to trading property (see note 16) - (198) (198)
-------------------------------------------------- --------------------- ------------------ ----------
Transfers (to)/from other assets (58,131) 58,131 -
-------------------------------------------------- --------------------- ------------------ ----------
Revaluation adjustment - (15,181) (15,181)
-------------------------------------------------- --------------------- ------------------ ----------
Write offs - (1,513) (1,513)
-------------------------------------------------- --------------------- ------------------ ----------
Exchange difference 3,602 3,736 7,338
-------------------------------------------------- --------------------- ------------------ ----------
At end of year 12,227 206,935 219,162
-------------------------------------------------- --------------------- ------------------ ----------
Depreciation and impairment losses
-------------------------------------------------- --------------------- ------------------ ----------
At beginning of year - 17,527 17,527
-------------------------------------------------- --------------------- ------------------ ----------
Direct disposals - (750) (750)
-------------------------------------------------- --------------------- ------------------ ----------
Disposals through disposal of subsidiary company - (159) (159)
-------------------------------------------------- --------------------- ------------------ ----------
Reclassification to assets held for sale - (75) (75)
-------------------------------------------------- --------------------- ------------------ ----------
Transfers to trading property (see note 16) - (104) (104)
-------------------------------------------------- --------------------- ------------------ ----------
Depreciation charge for the year - 2,919 2,919
-------------------------------------------------- --------------------- ------------------ ----------
Impairment loss - 14,167 14,167
-------------------------------------------------- --------------------- ------------------ ----------
Write offs - (433) (433)
-------------------------------------------------- --------------------- ------------------ ----------
Exchange difference - (945) (945)
-------------------------------------------------- --------------------- ------------------ ----------
At end of year - 32,147 32,147
-------------------------------------------------- --------------------- ------------------ ----------
Carrying amounts 12,227 174,788 187,015
-------------------------------------------------- --------------------- ------------------ ----------
Fair value hierarchy
The fair value of land and buildings, has been categorised as a Level 3 fair value based on the inputs to the valuation techniques used.
Valuation techniques and significant unobservable inputs
The valuation techniques used in measuring the fair value of land and buildings, as well as the significant unobservable inputs used are the same as those used as at 31 December 2015.
14. Investment property
30 June 31 December
2016 2015
EUR'000 EUR'000
------------------------------------------ -------- ------------
At beginning of period/year 340,853 451,880
------------------------------------------ -------- ------------
Direct acquisitions 11 1,064
------------------------------------------ -------- ------------
Concession/write off of land - (2,607)
------------------------------------------ -------- ------------
Reclassification to assets held for sale
(see note 15) - (52,507)
------------------------------------------ -------- ------------
Transfers to trading properties (see
note 16) - (14,290)
------------------------------------------ -------- ------------
Disposals through disposal of subsidiary
company - (10,979)
------------------------------------------ -------- ------------
Direct disposals - (756)
------------------------------------------ -------- ------------
Exchange difference (2,748) 14,095
------------------------------------------ -------- ------------
338,116 385,900
------------------------------------------ -------- ------------
Fair value adjustment (11) (45,047)
------------------------------------------ -------- ------------
At end of period/year 338,105 340,853
------------------------------------------ -------- ------------
Fair value hierarchy
The fair value of investment property, has been categorised as a Level 3 fair value based on the inputs to the valuation techniques used.
Valuation techniques and significant unobservable inputs
The valuation techniques used in measuring the fair value of investment property, as well as the significant unobservable inputs used are the same as those used as at 31 December 2015.
15. DISPOSAL GROUPS HELD FOR SALE
Management committed to a plan to sell four properties and associated liabilities, through the sale of their holding companies. Accordingly, the assets and liabilities of each of these holding companies are presented as separate disposal groups held for sale. The disposal groups are: Iktinos (owner of 'Sitia Bay') and Porto Heli (owner of 'Nikki Beach') in Greece, Azurna (owner of 'Livka Bay') in Croatia and Kalkan (owner of 'La Vanta') in Turkey. All of the disposal groups are included in the geographical segment of 'South-East Europe' and in the operating segments of 'Hotel & Leisure operations' (Porto Heli), 'Construction & Development' (Kalkan) and 'Other' (Iktinos and Azurna). Efforts to sell the disposal groups continued aiming to complete their sale within the next twelve months.
Impairment losses relating to the disposal group
Impairment losses of EUR205 thousand (30 June 2015: nil) for write-downs of the disposal groups to the lower of their carrying amount and their fair value less costs to sell have been recognised. The impairment losses have been applied to reduce the carrying amount of property, plant and equipment and equity accounted investee.
Assets and liabilities of disposal groups held for sale
As at 30 June 2016, the disposal groups comprised the following assets and liabilities:
Iktinos Azurna Kalkan Porto
disposal disposal disposal Heli
group group group disposal Total
group
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------------------- ---------- ---------- ---------- ---------- --------
Property, plant and equipment 4,439 - 21 - 4,460
-------------------------------- ---------- ---------- ---------- ---------- --------
Investment property 17,901 34,643 - - 52,544
-------------------------------- ---------- ---------- ---------- ---------- --------
Equity-accounted investee - - - 1,245 1,245
-------------------------------- ---------- ---------- ---------- ---------- --------
Deferred tax assets - - 1,667 - 1,667
-------------------------------- ---------- ---------- ---------- ---------- --------
Trading properties - - 7,769 - 7,769
-------------------------------- ---------- ---------- ---------- ---------- --------
Trade and other receivables - 7 1,401 - 1,408
-------------------------------- ---------- ---------- ---------- ---------- --------
Cash and cash equivalents 47 234 5 - 286
-------------------------------- ---------- ---------- ---------- ---------- --------
Assets held for sale 22,387 34,884 10,863 1,245 69,379
-------------------------------- ---------- ---------- ---------- ---------- --------
Loans and borrowings - 8,147 137 - 8,284
-------------------------------- ---------- ---------- ---------- ---------- --------
Deferred tax liabilities 3,382 4,469 25 - 7,876
-------------------------------- ---------- ---------- ---------- ---------- --------
Trade and other payables 254 956 82 - 1,292
-------------------------------- ---------- ---------- ---------- ---------- --------
Liabilities held for
sale 3,636 13,572 244 - 17,452
-------------------------------- ---------- ---------- ---------- ---------- --------
As at 31 December 2015, the disposal groups comprised the following assets and liabilities:
Iktinos Azurna Kalkan Porto
disposal disposal disposal Heli
group group group disposal Total
group
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------------------- ---------- ---------- ---------- ---------- --------
Property, plant and equipment 4,439 - 23 - 4,462
-------------------------------- ---------- ---------- ---------- ---------- --------
Investment property (see
note 14) 17,901 34,606 - - 52,507
-------------------------------- ---------- ---------- ---------- ---------- --------
Equity-accounted investee - - - 1,450 1,450
-------------------------------- ---------- ---------- ---------- ---------- --------
Deferred tax assets - - 1,628 - 1,628
-------------------------------- ---------- ---------- ---------- ---------- --------
Trading properties (see
note 16) - - 7,960 - 7,960
-------------------------------- ---------- ---------- ---------- ---------- --------
Trade and other receivables - 9 1,459 - 1,468
-------------------------------- ---------- ---------- ---------- ---------- --------
Cash and cash equivalents 86 282 397 - 765
-------------------------------- ---------- ---------- ---------- ---------- --------
Assets held for sale 22,426 34,897 11,467 1,450 70,240
-------------------------------- ---------- ---------- ---------- ---------- --------
Loans and borrowings - 8,162 538 - 8,700
-------------------------------- ---------- ---------- ---------- ---------- --------
Deferred tax liabilities 3,380 4,405 25 - 7,810
-------------------------------- ---------- ---------- ---------- ---------- --------
Trade and other payables 252 970 393 - 1,615
-------------------------------- ---------- ---------- ---------- ---------- --------
Liabilities held for
sale 3,632 13,537 956 - 18,125
-------------------------------- ---------- ---------- ---------- ---------- --------
Cumulative income or expenses included in other comprehensive income
No cumulative income or expenses relating to the disposal groups, is included in other comprehensive income.
Measurement of fair values
i. Fair value hierarchy
The fair value measurement for the disposal groups before costs to sell has been categorised as a Level 3 fair value based on the inputs to the valuation techniques used.
ii. Valuation techniques and significant unobservable inputs
The fair value of each disposal group is significantly based on the valuation of the immovable property in each group. The valuation techniques and significant unobservable inputs used in measuring the fair values of these properties are the same as those used as at 31 December 2015.
16. Trading properties
30 June 31 December
2016 2015
EUR'000 EUR'000
----------------------------------------- ------- -----------
At beginning of period/year 37,387 52,323
----------------------------------------- ------- -----------
Net direct disposals (2,707) (16,189)
----------------------------------------- ------- -----------
Net transfers from investment property
(see note 14) - 14,290
----------------------------------------- ------- -----------
Net transfers from property, plant and
equipment (see note 13) 2,029 94
----------------------------------------- ------- -----------
Disposals through disposal of subsidiary
companies (see note 29) (1,599) (1,952)
----------------------------------------- ------- -----------
Impairment loss - (3,431)
----------------------------------------- ------- -----------
Reclassification to assets held for sale
(see note 15) - (7,960)
----------------------------------------- ------- -----------
Exchange difference (40) 212
----------------------------------------- ------- -----------
At end of period/year 35,070 37,387
----------------------------------------- ------- -----------
17. AVAILABLE-FOR-SALE FINANCIAL ASSETS
On 15 July 2013, the Company acquired 9.6 million shares, equivalent to 10% of Itacare's share capital, for the amount of EUR1.9 million. Itacare is a real estate investment company that was listed on AIM until 16 May 2014, when the admission of its ordinary shares to trading on AIM was cancelled following a decision of its shareholders at the Extraordinary General Meeting that took place on 6 May 2014.
30 June 31 December
2016 2015
EUR'000 EUR'000
------------------------------------- -------- ------------
At beginning and end of period/year 2,201 2,201
------------------------------------- -------- ------------
Fair value hierarchy
The fair value of available-for-sale financial assets, on Itacare's de-listing date, was transferred from Level 1 to Level 3 at the fair value hierarchy.
18. equity accounted investees
DCI Holdings Progressive
Two Limited Porto Business
('DCI Heli Advisors
H2') S.A. Total
EUR'000 EUR'000 EUR'000 EUR'000
------------------------------------ ------------ ------- ----------- ---------
Balance as at 1 January 2016 188,637 - - 188,637
------------------------------------ ------------ ------- ----------- ---------
Share of loss, net of tax (34,389) - - (34,389)
------------------------------------ ------------ ------- ----------- ---------
Impairment loss (109,265) - - (109,265)
------------------------------------ ------------ ------- ----------- ---------
Share of revaluation reserve 17 - - 17
------------------------------------ ------------ ------- ----------- ---------
Balance as at 30 June 2016 45,000 - - 45,000
------------------------------------ ------------ ------- ----------- ---------
Balance as at 1 January 2015 231,972 2,227 24 234,223
------------------------------------ ------------ ------- ----------- ---------
Reclassification to assets held for
sale - (1,526) - (1,526)
------------------------------------ ------------ ------- ----------- ---------
Additions - 310 - 310
------------------------------------ ------------ ------- ----------- ---------
Disposals - - (24) (24)
------------------------------------ ------------ ------- ----------- ---------
Share of translation reserve 180 - - 180
------------------------------------ ------------ ------- ----------- ---------
Share of loss, net of tax (43,542) (1,011) - (44,553)
------------------------------------ ------------ ------- ----------- ---------
Share of revaluation reserve 27 - - 27
------------------------------------ ------------ ------- ----------- ---------
Balance as at 31 December 2015 188,637 - - 188,637
------------------------------------ ------------ ------- ----------- ---------
The details of the above investments are as follows:
Principal
place
of business/
Country Shareholding
of interest
Name incorporation Principal activities 30 June 31 December
2016 2015
------------ --------------- --------------------------- -------- ------------
Acquisition and holding
DCI H2 BVIs of investments in Cyprus 50% 50%
------------ --------------- --------------------------- -------- ------------
Acquisition and holding
Porto Heli BVIs of investments in Greece 25% 25%
------------ --------------- --------------------------- -------- ------------
The above shareholding interest percentages are rounded to the nearest integer.
During the period, the Company's investment in DCI H2, owner of Aristo Developers Limited ('Aristo'), decreased significantly, as a result of a share of loss and an impairment amounting to EUR34,389 thousand and EUR109,265 thousand, respectively. The share of loss comprises the result of the loan restructuring arrangement between Aristo and Bank of Cyprus, whereby a loss from the extinguishment of such bank loans emerged through their settlement with property swapped. The impairment loss has been recognized to bring the DCI H2 investment to its recoverable amount of EUR45 million, which represents the agreed proceeds of the Company from the disposal of its investment on 29 September 2016, as described in note 33, Events after the reporting period.
During 2015, the Company disposed of its participation in Progressive Business Advisors S.A. Also, its management committed to a plan to sell Porto Heli, owner of 'Nikki Beach', in Greece; and the investment in Porto Heli was reclassified to assets held for sale.
As of 30 June 2016, Aristo, had a total of EUR354 thousand (31 December 2015: EUR1.8 million) contractual capital commitments on property, plant and equipment and a total of EUR38 million (31 December 2015: EUR39 million) bank guarantees arising in the ordinary course of its business. Aristo's management does not anticipate any material liability to arise from these contingent liabilities. In addition, 1,500 shares out of 4,975 shares that the Company holds in DCI H2 are pledged as a security against the Group's bank loans.
Summary of financial information for equity accounted investees as at 30 June 2016 and 31 December 2015, not adjusted for the percentage of ownership held by the Group:
Porto Total
DCI H2 Heli
EUR'000 EUR'000 EUR'000
----------------------------------------------- ---------- -------- ----------
30 June 2016
----------------------------------------------- ---------- -------- ----------
Current assets 140,728 - 140,728
----------------------------------------------- ---------- -------- ----------
Non-current assets 361,226 - 361,226
----------------------------------------------- ---------- -------- ----------
Total assets 501,954 - 501,954
----------------------------------------------- ---------- -------- ----------
Current liabilities 95,888 - 95,888
----------------------------------------------- ---------- -------- ----------
Non-current liabilities 95,986 - 95,986
----------------------------------------------- ---------- -------- ----------
Total liabilities 191,874 - 191,874
----------------------------------------------- ---------- -------- ----------
Net assets 310,080 - 310,080
----------------------------------------------- ---------- -------- ----------
Group's share of net assets 154,265 - 154,265
----------------------------------------------- ---------- -------- ----------
Impairment loss (109,265) - (109,265)
----------------------------------------------- ---------- -------- ----------
Carrying amount of interest in investee 45,000 - 45,000
=============================================== ========== ======== ==========
Revenue 34,234 - 34,234
----------------------------------------------- ---------- -------- ----------
Loss for the period (69,124) - (69,124)
----------------------------------------------- ---------- -------- ----------
Other comprehensive income 33 - 33
=============================================== ========== ======== ==========
Total comprehensive income (69,091) - (69,091)
=============================================== ========== ======== ==========
Group's share of loss and total comprehensive
income (34,372) - (34,372)
----------------------------------------------- ---------- -------- ----------
31 December 2015
----------------------------------------------- ---------- -------- ----------
Current assets 193,448 5,630 199,078
----------------------------------------------- ---------- -------- ----------
Non-current assets 680,085 11,380 691,465
----------------------------------------------- ---------- -------- ----------
Total assets 873,533 17,010 890,543
----------------------------------------------- ---------- -------- ----------
Current liabilities 312,628 6,355 318,983
----------------------------------------------- ---------- -------- ---------- Non-current liabilities 181,734 4,551 186,285 ----------------------------------------------- ---------- -------- ---------- Total liabilities 494,362 10,906 505,268 ----------------------------------------------- ---------- -------- ---------- Net assets 379,171 6,104 385,275 ----------------------------------------------- ---------- -------- ---------- Carrying amount of interest in investee 188,637 - 188,637 =============================================== ========== ======== ========== Revenue 21,024 2,170 23,194 =============================================== ========== ======== ========== Loss for the year (87,522) (4,042) (91,564) =============================================== ========== ======== ========== Other comprehensive income 417 - 417 =============================================== ========== ======== ========== Total comprehensive income (87,105) (4,042) (91,147) =============================================== ========== ======== ========== Group's share of loss and total comprehensive income (43,335) (1,011) (44,346) =============================================== ========== ======== ==========
19. TRADE AND OTHER RECEIVABLES
30 June 31 December
2016 2015
EUR'000 EUR'000
------------------------------------ ------- -----------
Trade receivables 5,083 7,482
------------------------------------ ------- -----------
VAT receivables 3,284 3,560
==================================== ======= ===========
Other receivables 3,106 4,154
------------------------------------ ------- -----------
Total trade and other receivables 11,473 15,196
------------------------------------ ------- -----------
Prepayments and other assets 3,173 984
------------------------------------ ------- -----------
Total 14,646 16,180
------------------------------------ ------- -----------
30 June 31 December
2016 2015
EUR'000 EUR'000
------------- -------- ------------
Non-current 910 1,178
------------- -------- ------------
Current 13,736 15,002
------------- -------- ------------
Total 14,646 16,180
------------- -------- ------------
20. Cash and cash equivalents
30 June 31 December
2016 2015
EUR'000 EUR'000
---------------- ------- -----------
Bank balances 11,203 41,948
---------------- ------- -----------
Cash in hand 35 42
---------------- ------- -----------
Total 11,238 41,990
---------------- ------- -----------
During the period, the Group had no fixed deposits.
As at 30 June 2016, the amount of EUR4.1 million (2015: EUR4.1 million) received through the Colony Luxembourg S.a.r.l loan facility is restricted for use only towards the development of Amanzoe project.
21. CAPITAL AND RESERVES
Capital
Authorised share capital
30 June 2016 31 December 2015
------------------ ------------------
'000 of '000 of
shares EUR'000 shares EUR'000
------------------------- --------- ------- --------- -------
Common shares of EUR0.01
each 2,000,000 20,000 2,000,000 20,000
------------------------- --------- ------- --------- -------
Movement in share capital and premium
Shares in Share Share premium
capital
'000 EUR'000 EUR'000
------------------------------- ---------- --------- --------------
Capital at 1 January 2015 642,440 6,424 498,933
=============================== ========== ========= ==============
Shares issued on 9 June 2015 219,257 2,193 60,527
=============================== ========== ========= ==============
Placement costs - - (1,464)
=============================== ========== ========= ==============
Bond conversion shares on 11
June 2015 42,930 429 11,851
=============================== ========== ========= ==============
Capital at 31 December 2015 904,627 9,046 569,847
------------------------------- ---------- --------- --------------
Capital at 1 January 2016 and
30 June 2016 904,627 9,046 569,847
------------------------------- ---------- --------- --------------
On 9 June 2015 and 11 June 2015, the Company issued 219,256,609 new common shares and 42,930,080 bond conversion shares, respectively, at GBP 0.21 per share, for a total value of EUR75 million. The new shares rank pari passu with the existing common shares of the Company.
Warrants
In December 2011, the Company raised EUR8.5 million through the issue of new shares at GBP 0.27 per share (with warrants attached to subscribe for additional Company shares equal to 25% of the aggregate value of the new shares at the price of GBP 0.3105 per share, subject to anti-dilution adjustments pursuant to the warrant's terms and conditions - initial price of GBP 0.35 per share). The warrant holders can exercise their subscription rights within five years from the admission date. The number of shares to be issued on exercise of their rights will be determined based on the subscription price on the exercise date.
Reserves
Translation reserve
Translation reserve comprises all foreign currency differences arising from the translation of the interim financial statements of foreign operations.
Fair value reserve
Fair value reserve comprises the cumulative net change in fair value of available-for-sale financial assets until the assets are derecognised or impaired, and the revaluation of property, plant and equipment from both subsidiaries and equity accounted investees, net of any deferred tax.
22. LOANS AND BORROWINGS
Within one Within two More than
Total year to five years five years
-------------------- -------------------- -------------------- --------------------
30 June 31 December 30 June 31 December 30 June 31 December 30 June 31 December
2016 2015 2016 2015 2016 2015 2016 2015
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Loans in Euro 93,290 92,395 10,394 10,578 69,146 61,707 13,750 20,110
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Loans in United
States Dollars 54,926 57,550 5,515 6,638 49,411 50,912 - -
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Convertible bonds
payable 58,260 73,735 - 15,312 58,260 58,423 - -
===================== ======= =========== ======= =========== ======= =========== ======= ===========
206,476 223,680 15,909 32,528 176,817 171,042 13,750 20,110
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Loans in Euro within
disposal groups
held for sale 8,284 8,700 290 709 7,994 7,991 - -
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Total 214,760 232,380 16,199 33,237 184,811 179,033 13,750 20,110
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
As of 30 June 2016, there were no significant changes in terms and conditions of the outstanding loans, compared to 31 December 2015.
1 January New Capital Interest Other 30 June
2016 issues repayments paid movements 2016
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------------ ---------- -------- ------------ --------- ----------- --------
Loans in Euro 92,395 - (250) (3,023) 4,168 93,290
------------------------ ---------- -------- ------------ --------- ----------- --------
Loans in United States
Dollars 57,550 - (3,131) (756) 1,263 54,926
------------------------ ---------- -------- ------------ --------- ----------- --------
Convertible bonds in
Euro 50,000 - - (1,375) 1,375 50,000
------------------------ ---------- -------- ------------ --------- ----------- --------
Convertible bonds in
United States Dollars 23,735 - (14,892) (539) (44) 8,260
------------------------ ---------- -------- ------------ --------- ----------- --------
223,680 - (18,273) (5,693) 6,762 206,476
------------------------ ---------- -------- ------------ --------- ----------- --------
Loans in Euro within
disposal groups held
for sale 8,700 - (385) (171) 140 8,284
------------------------ ---------- -------- ------------ --------- ----------- --------
Total 232,380 - (18,658) (5,864) 6,902 214,760
------------------------ ---------- -------- ------------ --------- ----------- --------
Securities
As of 30 June 2016, there were no significant changes in the Group's loan securities compared to 31 December 2015.
Convertible bonds payable
On 5 April 2013, the Company issued 5,000 bonds (the 'Euro Bonds') at EUR10 thousand each, bearing interest of 5.5% per annum, payable semi-annually, and maturing on 5 April 2018.
On 23 April 2013, the Company issued 917 bonds (the 'US$ Bonds') at US$10 thousand each, bearing interest of 7% per annum, payable semi-annually, and maturing on 23 April 2018.
The Euro Bonds and the US$ Bonds may be converted prior to maturity (unless earlier redeemed or repurchased) at the option of the holder into common shares of EUR0.01 each. The conversion price is EUR0.5623, equivalent of GBP 0.49 (initial conversion price GBP 0.50) and US$0.6583, equivalent of GPB 0.4410 (initial conversion price GBP 0.45) per share for the Euro Bonds and the US$ Bonds, respectively.
The Euro Bonds and the US$ Bonds are not publicly traded.
Part of the bonds, amounting to EUR41,004 thousand, was subscribed by Third Point LLC, a significant shareholder of the Company.
On 29 March 2011, DCI Holdings Seven Limited ('DCI H7), issued 4,000 bonds at US$10 thousand each, bearing interest of 7% per annum, payable semi-annually, and maturing on 29 March 2016. On 23 April 2013, the Company purchased 891 bonds at a consideration of US$10 thousand each (representing their par value) plus corresponding accrued interest of approximately US$200 thousand using the funds received from the issue of the US$ Bonds. On 10 June 2015, certain bondholders, including the Investment Manager, opted to convert bonds of total value US$14,420 thousand into 42,930,080 shares that were admitted on AIM on 11 June 2015. The Investment Manager converted bonds of total value US$420 thousand into 1,250,390 shares. The remaining amount of DCI H7 bonds including any accrued interest was repaid on scheduled maturity date in March 2016.
The bonds were trading on the Open Market of the Frankfurt Stock Exchange (the freiverkehr market) under the symbol 12DD.
23. Finance lease LIABILITIES
30 June 2016 31 December 2015
-------------------------------- ---------------------------------
Present Present
Future value Future value
minimum of minimum minimum of minimum
lease lease lease lease
payments Interest payments payments Interest payments
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
--------------------- --------- -------- ----------- --------- -------- ------------
Less than one year 79 1 78 78 1 77
--------------------- --------- -------- ----------- --------- -------- ------------
Between two and five
years 197 9 188 197 8 189
--------------------- --------- -------- ----------- --------- -------- ------------
More than five years 4,148 1,391 2,757 4,186 1,419 2,767
--------------------- --------- -------- ----------- --------- -------- ------------
Total 4,424 1,401 3,023 4,461 1,428 3,033
--------------------- --------- -------- ----------- --------- -------- ------------
The major finance lease liabilities comprise leases in Greece with 99-year lease terms.
24. Deferred tax assets and liabilities
31 December
30 June 2016 2015
--------------------------- ---------------------------
Deferred Deferred Deferred Deferred
tax assets tax liabilities tax assets tax liabilities
EUR'000 EUR'000 EUR'000 EUR'000
----------------------------------------- ---------- --------------- ---------- ---------------
Balance at beginning of period/year 997 (30,129) 2,557 (55,180)
----------------------------------------- ---------- --------------- ---------- ---------------
From disposal of subsidiary - - - 314
----------------------------------------- ---------- --------------- ---------- ---------------
Recognised in profit or loss (1) 231 256 15,112
----------------------------------------- ---------- --------------- ---------- ---------------
Recognised in other comprehensive
income - - - 1,791
----------------------------------------- ---------- --------------- ---------- ---------------
Exchange difference and other - 64 (188) (257)
========================================= ========== =============== ========== ===============
Reclassification to (assets)/liabilities
held for sale - - (1,628) 8,091
========================================= ========== =============== ========== ===============
Balance at end of period/year 996 (29,834) 997 (30,129)
----------------------------------------- ---------- --------------- ---------- ---------------
Deferred tax assets and liabilities are attributable to the following:
31 December
30 June 2016 2015
--------------------------- ---------------------------
Deferred Deferred Deferred Deferred
tax assets tax liabilities tax assets tax liabilities
EUR'000 EUR'000 EUR'000 EUR'000
----------------------------------- ---------- --------------- ---------- ---------------
Revaluation of investment property - (23,777) - (23,819)
----------------------------------- ---------- --------------- ---------- ---------------
Revaluation of trading properties - (1,622) - (1,926)
----------------------------------- ---------- --------------- ---------- ---------------
Revaluation of property, plant
and equipment - (6,064) - (6,007)
=================================== ========== =============== ========== ===============
Other temporary differences - 1,629 - 1,623
----------------------------------- ---------- --------------- ---------- ---------------
Tax losses 996 - 997 -
----------------------------------- ---------- --------------- ---------- ---------------
Total 996 (29,834) 997 (30,129)
----------------------------------- ---------- --------------- ---------- ---------------
25. DEFERRED REVENUE
30 June 31 December
2016 2015
EUR'000 EUR'000
------------------------- -------- ------------
Prepayment from clients 24,013 21,713
------------------------- -------- ------------
Government grant 7,235 7,353
------------------------- -------- ------------
Total 31,248 29,066
------------------------- -------- ------------
30 June 31 December
2016 2015
EUR'000 EUR'000
------------- -------- ------------
Non-current 17,538 17,846
------------- -------- ------------
Current 13,710 11,220
------------- -------- ------------
Total 31,248 29,066
------------- -------- ------------
26. Trade and other payables
30 June 31 December
2016 2015
EUR'000 EUR'000
------------------------------------------------ ------- -----------
Trade payables 3,787 4,019
------------------------------------------------ ------- -----------
Land creditors 25,874 25,609
================================================ ======= ===========
Investment Manager fees payable (see note 28.2) 500 467
================================================ ======= ===========
Other payables and accrued expenses 30,398 34,844
------------------------------------------------ ------- -----------
Total 60,559 64,939
------------------------------------------------ ------- -----------
30 June 31 December
2016 2015
EUR'000 EUR'000
------------- -------- ------------
Non-current 6,861 6,698
------------- -------- ------------
Current 53,698 58,241
------------- -------- ------------
Total 60,559 64,939
------------- -------- ------------
27. NAV per share
30 June 31 December
2016 2015
'000 '000
--------------------------------------------------- ------- -----------
Total equity attributable to owners of the Company
(EUR) 317,310 481,589
--------------------------------------------------- ------- -----------
Number of common shares outstanding at end of
period/year 904,627 904,627
--------------------------------------------------- ------- -----------
NAV per share (EUR) 0.35 0.53
--------------------------------------------------- ------- -----------
28. Related party transactions
28.1 Directors' interest and remuneration
Directors' interest
Miltos Kambourides is the founder and managing partner of the Investment Manager.
The interests of the Directors as at 30 June 2016, all of which are beneficial, in the issued share capital of the Company as at this date were as follows:
Shares
'000
--------------------------------------- -------
Miltos Kambourides (indirect holding) 66,019
--------------------------------------- -------
Mark Townsend 132
--------------------------------------- -------
Save as disclosed, none of the Directors had any interest during the period in any material contract for the provision of services which was significant to the business of the Group.
On 5 July 2016, Mark Townsend purchased 150,000 shares of the Company, bringing his total interest to 282,000 shares.
On 15 July 2016, Andrew Coppel, purchased 150,000 shares of the Company.
From 1 January From 1 January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
------------------------------------ --------------- ---------------
Remuneration 1,022 304
------------------------------------ --------------- ---------------
Equity-settled share-based payment 49 -
arrangements
------------------------------------ --------------- ---------------
Total remuneration 1,071 304
------------------------------------ --------------- ---------------
The Directors' remuneration details for the six-month periods ended 30 June 2016 and 30 June 2015 were as follows:
From 1 January From 1 January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
------------------------ --------------- ---------------
Laurence Geller *678 97
------------------------ --------------- ---------------
Robert Heller 103 73
------------------------ --------------- ---------------
Graham Warner 93 73
------------------------ --------------- ---------------
Mark Townsend 31 7
------------------------ --------------- ---------------
Justin Rimel 2 7
------------------------ --------------- ---------------
Andrew Coppel 112 -
------------------------ --------------- ---------------
David B. Heller 3 10
------------------------ --------------- ---------------
Roger Lane-Smith - 23
------------------------ --------------- ---------------
Andreas Papageorghiou - 2
------------------------ --------------- ---------------
Cem Duna - 2
------------------------ --------------- ---------------
Antonios Achilleoudis - 2
------------------------ --------------- ---------------
Christopher Pissarides - 8
------------------------ --------------- ---------------
Total 1,022 304
------------------------ --------------- ---------------
*Comprises EUR636 thousand compensation for loss of office and EUR42 thousand compensation for expenses.
Mr. Miltos Kambourides has waived his fees.
On 25 February 2015, the Company announced the following Directorate changes. Andreas Papageorghiou, Cem Duna, Antonios Achilleoudis and Christopher Pissarides stepped down from the Board. Five new members joined the Board - Laurence Geller, who also served as Chairman, Robert Heller, Graham Warner, Mark Townsend and Justin Rimel. Miltos Kambourides and David B. Heller remained on the new Board, as did Roger Lane Smith until his retirement on 31 December 2015. On 6 October 2015, Andrew Coppel also joined the Board.
On 1 March 2016, Laurence Geller, David B. Heller and Justin Rimel resigned from the Company's Board with Andrew Coppel being appointed as the Independent Non-Executive Chairman.
Laurence Geller no longer retains an interest in the stock options issued pursuant to the Company's Stock Option Programme whilst Andrew Coppel does not participate in the Stock Option Programme.
On 19 July 2016, Sue Farr joined the Board as a non-executive Director.
28.2 Investment Manager remuneration
From 1 January From 1 January
2016 2015
to 30 June to 30 June
2016 2015
EUR'000 EUR'000
------------------------------------ --------------- ---------------
Annual fees 4,250 6,814
------------------------------------ --------------- ---------------
Equity-settled share-based payment 261 -
arrangements
------------------------------------ --------------- ---------------
Total remuneration 4,511 6,814
------------------------------------ --------------- ---------------
28. Related party transactions
In line with the Amended and Restated Investment Management Agreement, signed in June 2015 and effective from 1 July 2015, the following arrangements came into effect:
Annual fees
The Investment Manager is entitled to an annual management fee defined as follows:
-- for the period from 1 July 2015 to and including 31 December 2015, the annual management fee shall be EUR1 million per calendar month payable quarterly in advance; and
-- with effect from and including 1 January 2016, the annual management fee shall be EUR8.5 million payable quarterly in advance.
-- commencing on and with effect from 1 January 2017, the annual management fee payable for the following annual periods will be permanently reduced on 1 January in each year to an amount equal to the lower of:
(i) 1.25% of the gross asset value of the Company calculated as at the last preceding 31 December calculation date; and
(ii) EUR8.5 million.
In addition, the Company shall reimburse the Investment Manager for any professional fees or other costs incurred on behalf of the Company for the provision of services or advice.
Performance fees
Core asset incentive fee
The Investment Manager will be entitled to the core asset incentive fee based on the net profits received by the Company from the core assets or the disposal thereof.
Core assets comprise of the following projects: Amanzoe, Kilada Hills, Kea, Pearl Island and Playa Grande. All other assets of the Company are characterised as non-core for the purpose of incentive fee calculations.
The net proceeds will be divided between the Investment Manager and the Company on the following basis:
-- first, 100% to the Company until the Company has received an amount equal to EUR169.6 million (the 'Aggregate Core Asset Base Value');
-- second, 100% to the Company until the Company has received an amount equal to the core asset capital and costs;
-- third, 100% to the Company until the Company has received an amount equal to the base cost compounded quarterly at the average one-month Euribor rate plus 500 basis points (but capped at a maximum interest rate of 6% per annum);
-- fourth, 60% to the Investment Manager and 40% to the Company until the Investment Manager has received an amount equal to 20% of the net profits then distributed; and
-- thereafter, 20% to the Investment Manager and 80% to the Company such that the Investment Manager shall receive a total core asset incentive fee equivalent to 20% of the net profits.
On the disposal of a core asset, the Investment Manager shall be entitled to receive an advance of the core asset incentive fee on the following basis:
-- where the disposal takes place prior to the date on which the Company shall have first received an amount of net profits from the disposal of core assets equal to, or in excess of, EUR113,055,360 (the 'Trigger Date'), an amount equal to 6.666% of the net profits received by the Company on the disposal of such core asset; or
-- where the disposal takes place after the Trigger Date, an amount equal to 10% of the net profits received by the Company on the disposal of such core asset, (in each case a 'Core Asset Incentive Fee Advance Payment').
The aggregate value of any core asset incentive fee advance payments will at any time be set off against, and thereby reduce to not less than zero, any liability of the Company to pay core asset incentive fees.
Non-core asset incentive fee
The Investment Manager will be entitled to the non-core asset incentive fee based on the net profits received by the Company from the disposal of any non-core asset. No non-core asset incentive fee will be payable in respect of a non-core asset unless the aggregate disposal proceeds actually received by the Company in respect of such non-core asset exceeds the base value (the 'Payment Condition'). The base value is defined as 65% of the non-core asset value as at 31 December 2014. Subject to satisfaction of the Payment Condition in respect of any non-core asset, the net proceeds actually received by the Company from the disposal of such non-core asset will be divided between the Investment Manager and the Company on the following basis:
-- first, 100% to the Company until the Company has received an amount equal to the base value;
-- second, 12.5% to the Investment Manager and 87.5% to the Company until the net proceeds equal 80% of the base value;
-- third, 17.5% to the Investment Manager and 82.5% to the Company until the net proceeds equal 100% of the base value; and
-- thereafter, 25% to the Investment Manager and 75% to the Company.
50% of each non-core asset incentive fee will be placed in an interest bearing escrow account to be operated by the Company's administrator. Any funds held in this escrow account will be dealt with as follows; commencing on 31 December 2015, in the event that, as at 31 December in each year, the aggregate net proceeds received by the Company in relation to all non-core assets disposed of during the previous 12 month period (the 'Look-back Period'):
-- do not equal or exceed the aggregate of the base values of any non-core assets disposed of during an applicable Look-back Period (the 'Aggregate Base Value') then the Company's administrator will be authorised to repay any escrowed funds to the Company until such time as the Company has received an amount equal to the Aggregate Base Value and thereafter any remaining escrowed funds (if any) will be paid to the Investment Manager; or
-- equal or exceed the Aggregate Base Value then the Company's administrator will be authorised to pay to the Investment Manager the escrowed funds.
Incentive shares
Investment Manager Awards have been granted.
Clawback
Following the Amended and Restated Investment Management Agreement, if, on the clawback assessment date, the Company has not received an amount from the disposal of the core assets equal or in excess of the Aggregate Core Asset Base Value, the Investment Manager will pay to the Company an amount to cover the difference, not to exceed the aggregate amount of any Core Asset Incentive Fee Advance Payments received by the Investment Manager. The clawback assessment date is the earlier of, (i) disposal of the Company's interest in the last core asset concerned; or (ii) 1 August 2020. In the event that a fees clawback applies the Company shall be entitled to set off at any time the amount of any fees clawback payment due against, (i) any liability of the Company to pay non-core asset incentive fees and/or (ii) any other fees due and payable by the Company to the Investment Manager, but excluding the annual management fee. In addition, the Company will have a security interest over any unvested shares awarded to the Investment Manager under the Share Incentive Plan.
No performance fees were charged to the Company for the six-month periods ended 30 June 2016 and 30 June 2015. As at 30 June 2016, funds held in escrow, including accrued interest, were released (31 December 2015: EUR467 thousand).
Previous arrangements, in force until 30 June 2015, were as follows:
Annual fees
The Investment Manager was entitled to an annual management fee of 2% of the equity funds defined as follows:
-- EUR890 million; plus
-- The gross proceeds of further equity issues, other than the funds raised in respect of the proceeds of the equity issues as at 25 October 2012 and 30 December 2011; plus
-- Realised net profits less any amounts distributed to shareholders.
The equity funds as at 30 June 2015 comprised EUR681 million.
In addition, the Company reimbursed the Investment Manager for any professional fees or other costs incurred on behalf of the Company for the provision of services or advice.
Performance fees
The Investment Manager was entitled to a performance fee based on the net profits made by the Company, subject to the Company receiving the 'Relevant Investment Amount' which is defined as an amount equal to:
i The total cost of the investment reduced on a pro rated basis by an amount of EUR160.1 million*; plus
ii A hurdle amount equal to an annualised percentage return equal to the average one-month Euribor rate applicable in the period commencing from the month when the relevant cost was incurred compounded for each year or fraction of a year during which such investment was held (the 'Hurdle'); plus
iii A sum equal to the amount of any realised losses and/or write-downs in respect of any other investment which has not already been taken into account in determining the Investment Manager's entitlement to a performance fee.
In the event that the Company had received distributions from an investment equal to the Relevant Investment Amount, any subsequent net profits arising should have been distributed in the following order or priority:
i 60% to the Investment Manager and 40% to the Company until the Investment Manager should had received an amount equal to 20% of such profits; and
ii 80% to the Company and 20% to the Investment Manager, such that the Investment Manager should had received a total performance fee equivalent to 20% of the net profits.
* The total cost of investment was reduced in April 2014 by EUR7.6 million, as compared to the base reduction of EUR167.7 million, to reflect the loss incurred by the Company through the Pasakoy Yapi ve Turizm A.S. ('Pasakoy') sale transaction, as calculated in accordance with the Investment Management Agreement provisions and definitions.
The performance fee payment was subject to the following escrow and clawback provisions:
Escrow
The following table displays the previous escrow arrangements:
Escrow Terms
-------------------------------- ------------------------------
Up to EUR109 million returned 50% of overall performance
fee held in escrow
-------------------------------- ------------------------------
Up to EUR109 million plus 25% of any performance fee
the cumulative hurdle returned held in escrow
-------------------------------- ------------------------------
After the return of EUR409 All performance fees released
million post-hurdle, plus from escrow
the
return of EUR225 million
post-hurdle
-------------------------------- ------------------------------
Clawback
If on the earlier of (i) disposal of the Company's interest in a relevant investment or (ii) 1 August 2020, the proceeds realised from that investment are less than the Relevant Investment Amount, the Investment Manager should have paid to the Company an amount equivalent to the difference between the proceeds realised and the Relevant Investment Amount. The payment of the clawback was subject to the maximum amount payable by the Investment Manager not exceeding the aggregate performance fees (net of tax) previously received by the Investment Manager in relation to other investments.
28.3 Shareholder and development agreements
Shareholder agreements
DolphinCI Twenty Two Limited, a subsidiary of the Group, had signed a shareholder agreement with the non-controlling shareholder of Eastern Crete Development Company S.A., under which it had acquired 60% of the shares of the Plaka Bay project by paying the former majority shareholder a sum upon closing and a conditional amount in the event the non-controlling shareholder was successful in, among others, acquiring additional specific plots and obtaining construction permits. On 23 August 2013, the parties signed a new agreement for the purchase of the remaining 40% stake of the entity. The base consideration for the purchase was EUR4.4 million payable in three installments: EUR2.4 million by 10 September 2013, EUR1 million by 30 September 2013 and EUR1 million by 31 October 2013. The last installment of EUR1 million was transferred in February 2014. Consideration might be increased by the transfer of plots of land in the project, to the seller, of total market value equal to EUR4 million, subject to the project receiving permits for building 40,000 m2, of freehold residential properties. The conditional deferred consideration will be adjusted pro rata in case the buildable properties are less than 40,000 m2 but is also subject to a 5% annual increase commencing from the second anniversary from the signing of the agreement and until implementation by the Company.
On 20 September 2010, the Group signed an agreement with Archimedia, controlled by John Hunt, for the sale of a 14.29% stake in Amanzoe for a consideration of EUR11 million. The agreement also granted Archimedia the right to partially or wholly convert this shareholding stake into up to three predefined Aman Villas (the 'Conversion Villas') for a predetermined value and percentage per Villa. The first EUR1 million of the consideration was received at signing, while the completion of the transaction and the payment of the EUR10 million balance was subject to customary due diligence on the project and the issuance of the construction permits for the Conversion Villas prior to a longstop date set at 1 April 2011. On 28 March 2011, the Company reached an agreement with Archimedia to vary the original terms of the sale agreement, which was followed by the Company and Archimedia entering into an amended sale agreement on 13 March 2012. The Company received US$12,422 thousand and EUR1,300 thousand, while US$978 thousand and EUR800 thousand due as at 31 December 2013, plus any additional consideration that could be due depending on the exact size and features of the Conversion Villas, would be received upon completion of the Conversion Villas. On 2 July 2014, Archimedia remitted EUR904 thousand (EUR263 thousand and US$878 thousand) to the Company towards this end. As of 31 December 2015 no receivable amount was outstanding. On 3 August 2012, the Company received a Conversion Notice from Archimedia to convert 6.43% of its shares in Amanzoe in exchange for an Aman Villa and on 27 December 2012 a further Notice for the conversion of the remaining 7.86% of its shares for two other Aman Villas. As of 31 December 2015, all Villas Conversions had been completed and Archimedia did not hold any shareholding interest in Amanzoe.
On 6 August 2012, the Company signed an agreement for the sale of eight out of the nine remaining Seafront Villas, part of the Mindcompass Overseas Limited group of entities. The total base net consideration agreed for this sale was EUR10 million, with the Company also entitled to 50% profit participation in the sale of five Villas. It was also agreed that the Company would undertake the construction contract for the completion of the Villas and a EUR1 million deposit was paid upon signing. During 2013, the Company received an additional amount of EUR990 thousand. The construction of the two Villas is currently underway.
On 5 September 2012, the Company signed a sales agreement with a regional investor group led by Mr. Alberto Vallarino for the sale of its 60% shareholding in Peninsula Resort Holdings Limited, the entity that indirectly holds the land for Pearl Island's Founders' phase of the Pearl Island Project. The consideration for the sale was a cash payment of US$6 million (50% paid at closing on 14 September 2012 and 50% one year from closing, collected on 17 September 2013) and a commitment to invest an additional circa US$35 million of development capital within a maximum period of two years in order to complete the aforementioned phase of the project. Out of those funds, approximately US$13 million would be incurred on development of components owned by Pearl Island Limited S.A., with the entire amount already invested by 31 December 2015.
28.3 Shareholder and development agreements
Development agreements
Pursuant to the original Sale and Purchase Agreement of 10 December 2007, DCI H7 was obliged to make payments for the construction of infrastructure on the land retained by DR Beachfront Real Estate LLC ('DRB'), the former majority shareholder of PGH. Pursuant to a restructuring agreement dated 5 November 2012, those obligations have been restructured with the material provisions of that agreement already fulfilled. As at 31 December 2015, following cash payments of US$7.6 million and transfers of land parcels valued at approximately US$11.7 million, no amount is outstanding.
Pedro Gonzalez Holdings II Limited, a subsidiary of the Group in which the Company holds a 60% stake, has signed a Development Management agreement with DCI Holdings Twelve Limited ('DCI H12') in which the Group has a stake of 60%. Under its terms, DCI H12 undertakes, among others, the management of permitting, construction, sale and marketing of the Pearl Island project.
28.4 Other related parties
During the periods ended 30 June 2016 and 30 June 2015, the Group incurred the following related party transactions with the following parties:
30 June 2016
----------------------------------------- ---------------------- ---------------------------------------------------
Related party name EUR'000 Nature of transaction
----------------------------------------- ---------------------- ---------------------------------------------------
Iktinos Hellas S.A. 24 Project management services in
relation to Sitia project and rent
payment
----------------------------------------- ---------------------- ---------------------------------------------------
Third Point LLC, 1,200 Bond interest for the period
shareholder of the
Company
----------------------------------------- ---------------------- ---------------------------------------------------
30 June 2015
----------------------------------------- ---------------------- ---------------------------------------------------
Related party name EUR'000 Nature of transaction
----------------------------------------- ---------------------- ---------------------------------------------------
Iktinos Hellas S.A. 20 Project management services in
relation to Sitia project and rent
payment
----------------------------------------- ---------------------- ---------------------------------------------------
John Heah, non-controlling 408 Design fees in relation to Playa
shareholder of SPV Grande project
10
----------------------------------------- ---------------------- ---------------------------------------------------
Progressive Business 254 Accounting fees
Advisors S.A.
----------------------------------------- ---------------------- ---------------------------------------------------
Portoheli Ksenodoxio 16 Construction cost and project
Kai Marina S.A. management
services in relation to Nikki Beach
project
----------------------------------------- ---------------------- ---------------------------------------------------
Third Point LLC, 1,162 Bond interest for the period
shareholder of the
Company
----------------------------------------- ---------------------- ---------------------------------------------------
29. Business combinations
During the period ended 30 June 2016, the group disposed of its entire holding in DolphinCI Eleven Limited ('DCI 11'), as follows:
EUR'000
---------------------------------------------------- --------
Trading properties (see note 16) (1,599)
---------------------------------------------------- --------
Other liabilities 16
---------------------------------------------------- --------
Net assets disposed of (1,583)
---------------------------------------------------- --------
Disposal consideration via settlement of liability 2,780
---------------------------------------------------- --------
Gain on disposal recognised in profit or loss 1,197
---------------------------------------------------- --------
Net cash inflow on disposal -
---------------------------------------------------- --------
30. FINANCIAL RISK MANAGEMENT
The Group's financial risks and risk management objectives and policies are consistent with those disclosed in the consolidated financial statements as at and for the year ended 31 December 2015.
Fair values
The fair values of the Group's financial assets and liabilities approximate their carrying amounts at the statement of financial position date.
31. Commitments
As of 30 June 2016, the Group had a total of EUR2,245 thousand contractual capital commitments on property, plant and equipment (31 December 2015: EUR3,229 thousand).
Non-cancellable operating lease rentals are payable as follows:
31 December
30 June 2016 2015
EUR'000 EUR'000
--------------------------- ------------ -----------
Less than one year 19 19
--------------------------- ------------ -----------
Between two and five years 2 11
--------------------------- ------------ -----------
Total 21 30
--------------------------- ------------ -----------
32. Contingent liabilities
Companies of the Group are involved in pending litigations. Such litigations principally relate to day-to-day operations as a developer of second-home residences and largely derive from certain clients and suppliers. Based on the Group's legal advisers, the Investment Manager believes that there is sufficient defence against any claim and they do not expect that the Group will suffer any material loss. All provisions in relation to these matters which are considered necessary have been recorded in these consolidated financial statements.
In addition to the tax liabilities that have already been provided for in the condensed consolidated interim financial statements based on existing evidence, there is a possibility that additional tax liabilities may arise after the examination of the tax and other matters of the companies of the Group in the relevant tax jurisdictions.
The Group, under its normal course of business, guaranteed the development of properties in line with agreed specifications and time limits in favour of other parties.
33. EVENTS AFTER THE REPORtING PERIOD
On 29 September 2016, the Company reached a definitive agreement to dispose of its 49.75% shareholding in DCI H2 to Theodoros Aristodemou ('TA'), DCI H2' s current controlling shareholder. The disposal will be effected by way of a sale to TA of 49.75% of the shares in DCI H2 held by DCI Holdings One Ltd, a wholly-owned subsidiary of the Company, for a total cash consideration of EUR45 million, payable in quarterly instalments over three years and bearing annual interest of 4% in the first year, increasing to 5% and 6%, respectively, for each of the subsequent years. A EUR2 million discount to the total consideration will be granted if the full consideration is settled by 29 December 2016. The Company will also be entitled to a 25% share of any gross proceeds in excess of an implied company equity valuation of EUR100 million from the sale of any shares of DCI H2 (or of its subsidiaries) sold by the acquirer until the earlier of six months from the settlement of the full consideration (to the extent such settlement occurs by 29 December 2016 and the second anniversary from the transaction. The acquisition shares will be kept in escrow and transferred to the acquirer in line with the collection of the consideration by the Company, apart from a percentage which will remain escrowed until the final settlement of the consideration. In the event that any payment becomes overdue for more than three months either party has the right to terminate the sales agreement, in which case all the shares kept in escrow together with any corresponding dividend distributions will be retained by the Company.
There were no other material events after the reporting period which have a bearing on the understanding of the condensed consolidated interim financial statements as at 30 June 2016.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR EBLBXQKFZBBF
(END) Dow Jones Newswires
September 30, 2016 02:02 ET (06:02 GMT)
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