We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Register for streaming realtime charts, analysis tools, and prices.
| 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 | 0.00 | 01:00:00 |
| 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 : 1693S
Dolphin Capital Investors Limited
29 September 2017
29 September 2017
DOLPHIN CAPITAL INVESTORS LIMITED
("DCI" or "Dolphin" or the "Company"
and together with its subsidiaries the "Group")
Half Year Results for the six months ended 30 June 2017 and
Trading Update
Financial Highlights:
Hot Features
Premium
-- Gross Assets of EUR424 million (31 December 2016:
EUR466 million).
-- Total Group Net Asset Value ("NAV") of EUR251 million
and EUR219 million before and after Deferred Tax
Liabilities ("DTL") respectively. This represents
a decrease of EUR14 million and EUR15 million (5.3%
and 6.5%) respectively, against the 2016 year end
figures.
-- NAV reduction principally due to regular operational,
corporate, finance and management expenses. No
portfolio revaluation was undertaken during this
period; the next full portfolio valuation will
be conducted as at 31 December 2017.
-- Sterling NAV per share as at 30 June 2017 stood
at 24p before DTL and 21p after DTL, versus 25p
and 22p respectively as at 31 December 2016.
-- Total Debt of EUR97 million with a Group total
debt to gross asset ratio of 23%. DCI itself does
not have any further recourse loans or guarantees
and the remaining Group debt is at project level
on a non-recourse basis.
Portfolio:
-- The disposal of DCI's 60% interest in Pearl Island
to Grivalia Hospitality S.A. was completed on 13
March 2017. Dolphin received cash of EUR27 million
of which EUR2 million will remain in escrow for
a period of 12 months post completion to cover
any potential breach of DCI's warranties or undisclosed
indebtedness.
-- The Company in line with the stated strategic objective
of disposing of all assets by 31 December 2019
has engaged advisors and agents for the sale of
several other assets and has received expressions
of interest. In parallel the Group is in advanced
discussions with investors for joint venture transactions
for two projects which should facilitate their
disposal.
-- On 3 May 2017 the Company terminated the agreement
it had signed on 29 September 2016 to sell its
49.75% stake in Aristo Developers Ltd ("Aristo")
to Mr. Theodore Aristodemou. Under the payment
terms the Company had only received EUR1.8 million
of the total cash consideration up to the date
of termination which it retained together with
its remaining Aristo shares which amount to a 47.9%
shareholding in Aristo. Following the termination
of this transaction the Company is reviewing its
strategy regarding the realization of its investment
in Aristo.
Operations:
-- Amanzoe' s performance improved by increasing occupancy
to c.72% for the period through August 2017 versus
65% for the same period in 2016 generating an Average
Daily Rate ("ADR") of EUR1,452 and a Revenue per
Available Room ("RevPAR") of EUR1,050 over the
same period (2016: EUR1,319 and EUR852 respectively).
The continued operational improvement is expected
to generate a Net Operating Income ("NOI") increase
in excess of 35% for 2017 compared to 2016.
-- Aristo sold 91 homes up to August 2017 representing
total sales of EUR47.1 million up 44% compared
to the same period in 2016. In parallel Aristo
was successful in restructuring EUR44 million of
loan liabilities with Hellenic Bank through debt
to asset swaps during the period and together with
other loan principal repayments achieved a reduction
in overall bank debt as at 30 June 2017 to EUR68
million (EUR127 million as at 31 December 2016)
with total assets as at 30 June 2017 of EUR364
million (EUR433 million as at 31 December 2016).
Commenting, Andrew Coppel, Chairman of Dolphin's Board of Directors said:
"The Company remains focussed on achieving its objective to dispose of all its assets by 31 December 2019, following the New Asset Strategy which was adopted by the Company's shareholders in December 2016. We have prioritized our divestment activity, targeting initially specific projects which are more mature in terms of development and/or permitting, and we expect to have tangible results on certain of our ongoing initiatives prior to the year end."
Miltos Kambourides, Founder of Dolphin and Managing Partner of Dolphin Capital Partners said:
"The continuing improvement in the operations of certain key Group assets - Amanzoe, Aristo and Nikki Beach - coincides with the improvement in the investment climate in Greece and Cyprus and should assist our divestment initiatives. We continue to work on sourcing, structuring and executing sales and joint venture transactions and expect to be able to report additional completed deals by the end of the financial year."
For further information, please contact:
Dolphin Capital Investors Andrew M. Coppel, CBE +44 (0) 7785 577023 Dolphin Capital Partners miltos@dolphincp.com Miltos E. Kambourides Panmure Gordon (Broker) Richard Gray/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 (0) 20 7457 2020
A. Chairman's Statement
I am pleased to report Dolphin's interim financial results for the six months ended 30 June 2017 and to provide a trading update.
Loss after tax for the period ended 30 June 2017 attributable to owners of the Company amounted to EUR3 million compared to EUR162 million for the period ended 30 June 2016. The variation in Loss after tax was mainly due to the fact that in 2016 the carrying value of Aristo was significantly reduced.
Following the New Asset Strategy which was approved by the Company's shareholders in December 2016, the Board and the Investment Manager have continued their efforts to achieve the orderly and controlled disposal of the Group's assets by the end of 2019. In this regard, the Company completed the disposal of its interest in Pearl Island (Panama) and received EUR27 million cash consideration (of which EUR2 million remain in escrow) as well as advancing a number of other discussions with international and local investors for either sales or joint venture agreements relating to other projects within its diverse portfolio.
We were disappointed to terminate our agreement to sell our 49.75% shareholding in Aristo. As the deferred payments were not settled in accordance with the agreed terms, the Board considered that this was the only available option to safeguard the value of the Company's investment in Aristo. The significantly improved operating performance of Aristo during the period, coupled with its significant debt reduction, should support our renewed efforts to realise value from the Aristo shareholding.
Amanzoe continued to improve its trading performance in the current year and justifies the high ratings received in the market.
The Board and the Investment Manager will continue their efforts to increase working capital and accelerate shareholders' returns through the monetisation of assets. We believe that further tangible results can be achieved in the short term.
Andrew M. Coppel CBE
Chairman
Dolphin Capital Investors
29 September 2017
Investment Manager's Report
B.1. Business Overview
During the first nine months of 2017 we have continued to manage the Group's overall portfolio and achieved performance improvement across all operating projects. In parallel we were able to complete the Pearl Island sale and are progressing a number of discussions to monetise the Group's portfolio assets and explore joint venture options.
Our actions can be summarised as follows:
-- Executed the divestment of the 60% interest in
Pearl Island to Grivalia Hospitality S.A. for a
EUR27 million cash consideration (implying a EUR63
million enterprise value).
-- Realised continuously improving revenue and NOI
in Amanzoe which is expected to exceed 2016 by
more than 35%.
-- Engaged advisors (including Deloitte, Ernst & Young
and CBRE) to assist us in sourcing interest for
the divestment of certain portfolio assets and
currently have a number of ongoing discussions
with potential acquirers.
B.2. Portfolio Review
-- Amanzoe, Greece (www.amanzoe.com)
-- Amanzoe initiated operations for the 2017 season
on 1 April 2017, as scheduled, with eight villas
in the rental programme. Hotel performance for
the period to end August 2017 is currently ahead
of last year for the same period, with occupancy
reaching c.72% versus 65% in 2016, an ADR of
EUR1,452 and a RevPAR EUR1,050 versus EUR1,319
and EUR852 for the same period in 2016.
-- The Villa rental daily rates during the highest
season ranged from EUR3,177 to EUR25,000 and
generated revenues that represent a year-on-year
30% increase.
-- No Villa sales were concluded during the period.
Several site visits took place in the summer
season with potential villa buyers, a small
number of whom are currently in negotiations
which are expected to be concluded by the end
of the year. We have also identified demand
for 2-bedroom Amanzoe Villas and we have made
this purchase option available to buyers for
the first time in 2017.
-- One additional villa was added to the rental
pool in July 2017. This one bedroom villa features
the first James Turrell Skyspace in a private
home in Europe and was inaugurated in the presence
of the artist himself. Since the completion
of the villa it has enjoyed very strong demand.
Works to build other villas were suspended during
the summer period so as not to impact operations
of the hotel and recommenced in the third week
of September.
-- Amanzoe and Amanzoe Villas received extensive
coverage in the international press and in September
2017 Amanzoe was voted in the Conde Nast Traveller
(UK) Readers' Awards as the 4th best hotel in
Europe, Turkey and Russia and 26th in the World's
Top 100 (which includes destinations, cities,
hotels, airlines, cruise lines etc.).
-- Kilada Hills Golf Resort Greece
-- The master plan and construction permit for
the infrastructure for the individual neighbourhoods
of the Kilada Hills Golf Resort remain under
review with the relevant authorities. During
July 2017 the detailed Environmental Impact
Study was approved by the Regional Government
and the Ministry of Culture with respect to
potential antiquity issues. The remaining action
is the official authorization which is expected
to be issued by the relevant ministry prior
to the end of 2017.
-- The Project's development financing will be
primarily sourced through a combination of senior
secured bank financing at the project level
as well as third party equity investment, as
residential lot pre-sales proceeds received
under the Founders Program will remain in escrow
until the completion of the development. The
Company remains in discussions with both investors
and local banks with a view to securing the
development funds required.
-- Pearl Island, Panama
-- Following the advances achieved in the project's
permitting and financing, on 17 January 2017
the Company entered into a sale agreement for
the disposal of its 60% interest in Pearl Island
to Grivalia Hospitality S.A. The proceeds were
received on 13 March as previously announced
by the Company.
-- Kea Resort, Greece
-- The Company has continued to make progress in
its negotiations with a high-end international
resort and real estate investor for a joint
venture relating to Kea Resort.
-- The joint venture transaction envisages the
contribution of the additional equity investment
required for the development of the resort from
the investor group in return for a 50% shareholding
in the project. The investor group will also
undertake management and branding of Kea Resort
and Villas.
-- The Company has received a term-sheet from a
local bank for a EUR30 million senior construction
loan (as well as a VAT bridge facility) that
will complete the financing sources for the
construction of Kea Resort in accordance with
the existing development budget.
The loan will be structured as a ring-fenced
project financing facility and there will be
no recourse to DCI.
-- Aristo (a 47.9% affiliate)
Operating Performance
-- Strong sales momentum has continued in 2017, with 61 homes and
plots sold during the first six months of 2017 and 91 homes and
plots sold during the period through August 2017, representing
total sales of EUR33.2 million during the first six months and
EUR47.1 million for the period through August 2017 (an increase
of c.49% and c.44% respectively on a year-on year basis).
Twelve
Six months Six months Eight months Eight months months
to 30 June to 30 June to 31 August to 31 August to 31 December
2017 2016 2017 2016 2016
RETAIL SALES
--------------- -------------- -------------- -------------- -------------- ----------------
New sales
booked EUR33,265,616 EUR22,265,122 EUR47,139,731 EUR32,696,818 EUR42,349,273
% change 49% 44%
Units sold 61 58 91 84 104
% change 5% 8%
CLIENT ORIGIN
--------------- -------------- -------------- -------------- -------------- ----------------
China &
Other Asia 78.2% 47.8% 81.7% 53.5% 56.3%
MENA 9.8% 24.9% 9.2% 20.2% 17%
Russia 6.9% 5.6% 5.5% 3.8% 8.3%
UK - - - 2.1% 1.6%
Cyprus &
Other EU 5% 21.7% 3.6% 20.4% 16.6%
Termination of Agreement for the disposal of DCI's stake in Aristo
-- 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.
The Company has received to date EUR1.8 million of the cash consideration
out of the EUR45 million due under the sale agreement. However
the instalments due under the agreement have not been met. Mr.
Aristodemou had indicated to the Company that payment of the instalments
due under the sale agreement would be uncertain whilst he remains
involved in on-going litigation in Cyprus relating to his tenure
as the Bank of Cyprus Chairman and until there is more clarity
and certainty on the expected outcome of the respective court
proceedings. In that regard, the Company decided on 3 May 2017
to terminate the existing agreement and retain the unpaid portion
of its Aristo shares which corresponds to a 47.9% shareholding.
-- The Company is encouraged by the significant improvement in Aristo
operations, the increase in sales velocity and the substantial
reduction of Aristo's bank debt burden achieved during 2017. On
the back of this operational momentum, we are reviewing the Company's
strategic options regarding the realization of our holding in
Aristo.
-- Nikki Beach, Porto Heli (a 25% DCI affiliate)
-- The operations improved during 2017 compared
to 2016. The expected occupancy for the 2017
operational period is 59% (168 days) compared
to 50% for 2016 (166 days), with a net expected
ADR of EUR223 and a RevPAR of EUR131 versus
EUR253 and EUR126 respectively in 2016.
-- On 23 February 2017 we signed a commercial co-operation
agreement with a local white-label operator,
regarding the commercial exploitation of the
Nikki Beach Resort and Spa at Porto Heli, and
the Company now has no financial exposure to
the day-to-day operational performance of the
hotel as it receives monthly revenue-linked
payments without incurring any hotel operating
costs.
-- Apollo Heights
-- The zoning and entitlement processes have been
extremely slow and cumbersome for all land owners
in the Sovereign Bases Area, resulting in a
delay in receiving the planning approvals. We
remain in close contact and co-operation with
the relevant local and government authorities'
representatives who have indicated that the
zoning process shall progress in a timely manner
and by not later than Q2 2018.
C. Market Dynamics
-- Greece
-- For the first time since 2014, Greece returned
to the bond markets for the first time since
2014, during the summer of 2017, pricing EUR3bn
of new five-year bonds at a yield of 4.625%.
Greece's successful return to the capital markets
sent a strong signal that the country's public
finances and economy are finally recovering
following its recent bailout program. In parallel,
the country realized a 0.8% year-on-year GDP
increase in the second quarter of 2017 after
several years of GDP reduction or stagnation.
Greece's tourism sector is largely responsible
for this Q2 GDP increase and is expected to
further assist the sustained recovery of the
country's economy and the curbing of its substantial
external trade deficit. Tourist arrivals for
2017 are expected to surpass 28.5 million, setting
a new record.
-- Cyprus
-- The emerging economic recovery has been reinforced
since the country exited the bail-out program
15 months ago. The economy expanded by 3.5%
year-on-year in the second quarter of 2017,
driven mainly by improved levels of private
consumption and a record year for the tourism
industry. For the period of January to July
2017, arrivals of tourists totalled 1,994,236
compared to 1,737,372 in the corresponding period
of 2016, recording an increase of 14.8% and
exceeding the total arrivals ever recorded in
Cyprus during the first seven months of the
year, as reported by the country's Statistical
Service. During the first eight months of 2017,
the real estate market activity kept accelerating
on the back of naturalisation incentives offered
to third country nationals (Cyprus passport
and "golden visa" incentives) as well as debt
to asset swaps undertaken by major banks.
-- Croatia
-- The first six months of 2017 saw 5.7 million
tourists and 22.9 million overnight stays. This
was a rise of 22% and 23% respectively compared
to last year. The city of Split is currently
experiencing its busiest tourist season to date
with tourism up close to 30% in the first 7
months of 2017.
-- Turkey
-- During this year's second quarter, there were
signs that Turkey's economy is recovering in
comparison to last year. The GDP growth for
Q2 was 5.1% year-on-year with positive contributions
from both domestic and foreign demand. The Turkish
Lira continues to recover against the USD and
especially so after the economic Q2 GDP growth.
According to the Turkish Statistical Institute
there is a continued pick-up in demand. In the
second quarter of 2017 tourism income increased
by 8.7% and for the first six months of the
year foreign visitor numbers are up by 14%.
However, the political situation in Turkey remains
challenging as it keeps shifting further from
a potential EU integration. This creates uncertainty
which suppresses the country's foreign direct
investment potential in the short term.
D. Group Assets
A summary of Dolphin's current investments is presented below. As at 30 June 2017, the net investment amount stood at EUR490 million.
Loan
to real
Real estate
Land Investment Debt estate asset
site DCI's cost* (EURm) value value
PROJECT (hectares) stake (EURm) ** (EURm) (%)
--- --------------- ------------ ------- ----------- -------- -------- ---------
1 Amanzoe 93 100% 40 73
Kilada Hills
2 Golf Resort 235 100% 95 -
3 Kea Resort 65 67% 9 -
The Nikki
Beach Resort
4 & Spa 1 25% 6 -
Sitia Bay
5 Golf Resort 270 78% 17 -
Scorpio Bay
6 Resort 172 100% 15 -
Lavender Bay
7 Resort 310 100% 26 -
Plaka Bay
8 Resort 442 100% 13 -
9 Triopetra 11 100% 4 -
Apollo Heights
10 Polo Resort 461 100% 23 16
Livka Bay
11 Resort 63 100% 29 8
La Vanta -
Mediterra
12 Resorts 8 100% 18 -
TOTAL 2,131 295 97 356 27%
--- --------------- ------------ ------- ----------- -------- -------- ---------
ARISTO CYPRUS* 1,448 47.9% 193 - 43
Itacaré
Investment n/a 13% 2 - 1
GRAND TOTAL 3,579 490 97 400 24%
--- --------------- ------------ ------- ----------- -------- -------- ---------
*Residual investment cost, including amounts paid in shares.
**Further details on debt maturities are set out under note 22 of the financial statements.
A breakdown of Dolphin's portfolio, as at 30 June 2017, for certain key metrics is provided below:
Investment Real % Loan
Cost Estate to real
Land * Debt Value estate
size (EUR (EUR (EUR asset Net Asset
COUNTRY (hectares) million) million) million) value Value
--------- ------------ ----------- ---------- ---------- --------- ----------
1 Greece 1,599 225 73 286 26% 63%
2 Cyprus** 1,909 216 16 73 22% 23%
3 Other 71 49 8 41 20% 14%
Grand
Total 3,579 490 97 400 24% 100%
--------- ------------ ----------- ---------- ---------- --------- ----------
*Residual investment cost, including amounts paid in shares.
**DCI's portfolio in Cyprus includes its equity investment in Aristo Developers Ltd, which owns assets in Cyprus that are subject to Aristo's debt and other obligations.
E. Future Objectives
The Company's main objectives for the remainder of 2017 are to:
1. Generate additional liquidity through the monetisation of assets;
2. Secure third party funding for the development of Kea and Kilada Hills
so that they become more attractive to potential investors and acquirers;
3. Increase the sales velocity of villas at Amanzoe; and
4. Where appropriate, advance the zoning, permitting, design and branding
of certain assets to improve their sales potential and value.
Miltos Kambourides Pierre Charalambides
Managing Partner Founding Partner
Dolphin Capital Partners Dolphin Capital Partners
29 September 2017 29 September 2017
F. Financial Position for the first half of 2017
Financial Results
Loss after tax for the period ended 30 June 2017 attributable to owners of the Company amounted to EUR3 million compared to EUR162 million for the period ended 30 June 2016. Loss per share was EUR0.003 compared to EUR0.18 in the same period last year.
Condensed consolidated interim statement of profit or loss and other comprehensive income
For the six-month period ended 30 June 2017
1 January 1 January
2017 2016
30 June 30 June
2017 2016
(Restated)
EUR'000 EUR'000
------------------------------------------ ---------- -----------
Continuing operations
------------------------------------------ ---------- -----------
Revenue 5,468 6,543
------------------------------------------ ---------- -----------
Cost of sales (5,002) (6,842)
------------------------------------------ ---------- -----------
Gross profit 466 (299)
------------------------------------------ ---------- -----------
Disposal of investments 4 1,197
------------------------------------------ ---------- -----------
Change in valuations - (109,470)
------------------------------------------ ---------- -----------
Investment Manager remuneration (4,606) (4,511)
------------------------------------------ ---------- -----------
Directors' remuneration (422) (1,071)
------------------------------------------ ---------- -----------
Depreciation charge (1,175) (1,103)
------------------------------------------ ---------- -----------
Professional fees (2,311) (2,817)
------------------------------------------ ---------- -----------
Administrative and other expenses (807) (1,521)
------------------------------------------ ---------- -----------
Total operating and other expenses (9,317) (119,296)
------------------------------------------ ---------- -----------
Results from operating activities (8,851) (119,595)
------------------------------------------ ---------- -----------
Finance income 3,968 22
------------------------------------------ ---------- -----------
Finance costs (4,166) (7,015)
------------------------------------------ ---------- -----------
Net finance costs (198) (6,993)
------------------------------------------ ---------- -----------
Share of losses on equity-accounted
investees, net of tax - (34,389)
------------------------------------------ ---------- -----------
Loss before taxation (9,049) (160,977)
------------------------------------------ ---------- -----------
Taxation (1,090) 319
------------------------------------------ ---------- -----------
Loss from continuing operations (10,139) (160,658)
------------------------------------------ ---------- -----------
DISContinuED operation
------------------------------------------ ---------- -----------
Profit/(loss) from discontinued
operation, net of tax 12,331 (2,333)
------------------------------------------ ---------- -----------
Profit/(loss) 2,192 (162,991)
------------------------------------------ ---------- -----------
Other comprehensive income
------------------------------------------ ---------- -----------
Items that will not be reclassified
to profit or loss
------------------------------------------ ---------- -----------
Share of revaluation on equity-accounted
investees - 17
------------------------------------------ ---------- -----------
Items that are or may be reclassified
subsequently to profit or loss
------------------------------------------ ---------- -----------
Foreign currency translation differences (13,193) (2,769)
------------------------------------------ ---------- -----------
Other comprehensive income, net
of tax (13,193) (2,752)
------------------------------------------ ---------- -----------
Total comprehensive income (11,001) (165,743)
------------------------------------------ ---------- -----------
Profit/(loss) attributable to:
------------------------------------------ ---------- -----------
Owners of the Company (2,682) (162,417)
------------------------------------------ ---------- -----------
Non-controlling interests 4,874 (574)
------------------------------------------ ---------- -----------
2,192 (162,991)
========================================== ========== ===========
Total comprehensive income attributable
to:
------------------------------------------ ---------- -----------
Owners of the Company (15,290) (164,589)
------------------------------------------ ---------- -----------
Non-controlling interests 4,289 (1,154)
========================================== ========== ===========
(11,001) (165,743)
========================================== ========== ===========
(Loss)/EARNINGS per share
------------------------------------------ ---------- -----------
Basic and diluted loss per share
(EUR) (0.003) (0.180)
------------------------------------------ ---------- -----------
Basic and diluted loss per share
- Continuing(EUR) Operations (EUR) (0.011) (0.178)
------------------------------------------ ---------- -----------
Basic and diluted earnings/(loss)per
share - Discontinued(EUR) operation
(EUR)(EUR) 0.008 (0.002)
------------------------------------------ ---------- -----------
The variation in Loss after tax was mainly due to the fact that in 2016 the carrying value of Aristo was reduced by EUR35 million as a result of the debt restructuring agreement reached with Bank of Cyprus and by another EUR109 million as a write-down in value to reflect the EUR45 million sales price agreed with Mr. Aristodemou in a transaction that did not complete as further discussed above under section B.2.. Further analysis of individual revenue and expense items is provided below.
Revenue
Revenues from continuing operations of EUR5.5 million (H1 2016: EUR6.5 million), were derived from the following sources:
H1 2017 H1 2016
EUR million EUR million
------------------------------ ------------- --------------
Income from hotel operations 4.8 3.6
Sale of trading & investment
properties 0.0 2.5
Other income 0.7 0.4
TOTAL 5.5 6.5
The reduction in the sale of trading and investment properties relates to the fact that no new Villas were delivered in the first half of 2017 in the Amanzoe project, whereas in 2016 the sale of one Villa plot was recognized in the financial statements. The improved Amanzoe performance during the period resulted in the 32% increase on income from hotel operations.
Cost of sales
Cost of sales from continuing operations comprises the following basic categories:
H1 2017 H1 2016
EUR million EUR million
------------------------------------ ------------- --------------
Cost of sales related
to:
Hotel operations 2.3 1.6
Sales of trading and investment
properties 0.0 1.4
Commission to agents and
others 0.0 0.1
Personnel expenses 2.3 2.1
Branding fees 0.3 1.2
Other operating expenses 0.1 0.5
TOTAL 5.0 6.9
The charge of cost of sales from continuing operations for the period amounted to EUR5.0 million (H1 2016: EUR6.9 million). The decrease is attributable to cost of Villas sold as well as to the decrease in Villa branding fees. These reductions were counterbalanced by an increase in hotel operations costs reflecting the increased occupancy of Amanzoe.
Professional Fees
The charge for the period from continuing operations was EUR2.3 million (H1 2016: EUR2.8 million) and comprises the following:
H1 2017 H1 2016
EUR million EUR million
-------------------------------- ------------- -------------
Legal fees 0.6 0.5
Auditors' remuneration 0.2 0.2
Accounting expenses 0.1 0.1
Project design and development
fees 1.0 1.1
Consultancy fees 0.2 0.4
Administrator fees 0.0 0.1
Other professional fees 0.2 0.4
-------------------------------- ------------- -------------
TOTAL 2.3 2.8
Administrative and other expenses
The administrative and other expenses from continuing operations amounted to EUR0.8 million (H1 2016: EUR1.5 million) and are analysed as follows:
H1 2017 H1 2016
EUR million EUR million
------------------------------ ------------- --------------
Travelling and accommodation 0.1 0.2
Repairs and maintenance 0.1 0.1
Marketing and advertising
expenses 0.1 0.2
Rents 0.1 0.1
Other 0.4 0.9
------------------------------ ------------- --------------
TOTAL 0.8 1.5
Net Finance costs
The charge for the period from continuing operations was EUR0.2 million (H1 2016: EUR7 million) and comprises the following:
H1 2017 H1 2016
EUR million EUR million
---------------- ------------- -------------
Finance income 4.0 0
Finance costs (4.2) (7.0)
TOTAL (0.2) (7.0)
During the period, the Company entered into new contracts in connection with the deferred purchase of land at Lavender Bay. The revised interest rate agreed on the outstanding consideration is lower than that specified in the previous contracts. As the new contracts have a retrospective effect, the interest previously accrued in prior years of approx. EUR4 million has been reversed during the six-month period ended 30 June 2017 and included in finance income.
Decrease in Finance costs is mainly due to the retirement of all of the DCI's EUR50 million and USD9.17 million Convertible bonds. These bonds were cancelled upon the completion of the Playa Grande sale at the end of 2016.
Condensed consolidated interim statement of financial position
As at 30 June 2017
31 December
30 June 2017 2016
EUR'000 EUR'000
------------------------------ ------------ -----------
Assets
------------------------------ ------------ -----------
Property, plant and equipment 86,607 87,647
------------------------------- ------------ -----------
Investment property 176,553 176,548
------------------------------- ------------ -----------
Deferred tax assets 995 996
------------------------------- ------------ -----------
Non-current assets 264,155 265,191
------------------------------- ------------ -----------
Trading properties 30,214 29,763
------------------------------- ------------ -----------
Trade and other receivables 7,787 4,001
------------------------------- ------------ -----------
Cash and cash equivalents 14,653 4,698
------------------------------- ------------ -----------
Assets held for sale 106,708 162,435
------------------------------- ------------ -----------
Current assets 159,362 200,897
------------------------------- ------------ -----------
Total assets 423,517 466,088
=============================== ============ ===========
Equity
------------------------------ ------------ -----------
Share capital 9,046 9,046
------------------------------- ------------ -----------
Share premium 569,847 569,847
------------------------------- ------------ -----------
Retained deficit (368,337) (365,689)
=============================== ============ ===========
Other reserves 8,075 20,683
=============================== ============ ===========
Equity attributable to
owners of the Company 218,631 233,887
------------------------------- ------------ -----------
Non-controlling interests 4,925 17,993
------------------------------- ------------ -----------
Total equity 223,556 251,880
------------------------------- ------------ -----------
Liabilities
------------------------------ ------------ -----------
Loans and borrowings 78,114 79,521
------------------------------- ------------ -----------
Finance lease liabilities 2,912 2,934
------------------------------- ------------ -----------
Deferred tax liabilities 25,379 24,255
------------------------------- ------------ -----------
Trade and other payables 27,764 6,479
------------------------------- ------------ -----------
Deferred revenue 7,108 7,230
------------------------------- ------------ -----------
Non-current liabilities 141,277 120,419
------------------------------- ------------ -----------
Loans and borrowings 11,126 12,749
------------------------------- ------------ -----------
Finance lease liabilities 84 48
------------------------------- ------------ -----------
Trade and other payables 13,535 43,112
------------------------------- ------------ -----------
Deferred revenue 17,687 10,683
------------------------------- ------------ -----------
Liabilities held for sale 16,252 27,197
------------------------------- ------------ -----------
Current liabilities 58,684 93,789
------------------------------- ------------ -----------
Total liabilities 199,961 214,208
------------------------------- ------------ -----------
Total equity and liabilities 423,517 466,088
------------------------------- ------------ -----------
Net asset value ('NAV')
per share (EUR) 0.24 0.26
------------------------------- ------------ -----------
The reported NAV as at 30 June 2017 is presented below:
As at As at Variation since Variation since
30 June 2017 30 June 2016 30 June 2016 31 December 2016
EUR GBP EUR GBP EUR GBP EUR GBP
-------------------------------- ------- ------- ------- ------ --------- ---------- --------- ---------
Total NAV before DTL (million) 251 221 355 294 (29.4%) (24.9%) (5.3%) (2.7%)
-------------------------------- ------- ------- ------- ------ --------- ---------- --------- ---------
Total NAV after DTL (million) 219 192 317 262 (31.1%) (26.7%) (6.5%) (4.0%)
-------------------------------- ------- ------- ------- ------ --------- ---------- --------- ---------
NAV per share before DTL 0.28 0.24 0.39 0.32 (29.4%) (24.9%) (5.3%) (2.7%)
-------------------------------- ------- ------- ------- ------ --------- ---------- --------- ---------
NAV per share after DTL 0.24 0.21 0.35 0.29 (31.1%) ((26.7%) (6.5%) (4.0%)
-------------------------------- ------- ------- ------- ------ --------- ---------- --------- ---------
___________
Notes:
1. Euro/GBP rate 0.87966 as at 30 June 2017 and 0.85637
as at 31 December 2016.
2. NAV per share has been calculated on the basis of
904,626,856 issued shares as at 30 June 2017 and
as at 31 December 2016.
Total Group NAV as at 30 June 2017 was EUR251 million and EUR219 million before and after Deferred Tax Liabilities ("DTL") respectively. This represents a decrease of EUR14 million (5.3%) and EUR15 million (6.5%), respectively, from the 31 December 2016 figures. Given that no valuation of the Company's portfolio took place as at 30 June 2017, the NAV reduction is mainly due to Dolphin's regular operational, corporate, finance and management expenses.
Sterling NAV per share as at 30 June 2017 was 24p before DTL and 21p after DTL and decreased by 2.7% and 4.0%, before and after DTL respectively compared to the 31 December 2016 figures. In addition to the factors mentioned above, the NAV per share was affected by a 2.7% appreciation of the Euro versus Sterling.
The Company's consolidated assets include EUR293 million of real estate assets, EUR107 million of assets held for sale, EUR9 million of other assets (trade and other receivables as well as deferred tax assets) and EUR15 million in cash.
The balance of EUR293 million of real estate assets (property, plant and equipment, investment property and trading properties) represents the fair market valuation for both freehold and long leasehold interests.
The EUR107 million of assets held for sale includes EUR61 million of real estate assets, EUR44 million of investment in equity accounted investees (the Company's 47.9% interest in Aristo and its 25% interest in Nikki Beach as at 30 June 2017), EUR1 million of available-for-sale financial assets which represents the Company's investment in Itacaré and EUR1 million of other assets. The EUR61 million figure comprises the aggregate total appraised value of the Company's Sitia Bay, Livka Bay and La Vanta projects.
The Company's consolidated liabilities (excluding DTL) total EUR168 million and mainly comprise EUR100 million of interest bearing loans and finance lease obligations (of which EUR8 million are classified as liabilities held for sale). All loans are held by Group subsidiaries and are non-recourse to Dolphin.
The EUR67 million of trade and other payables and deferred revenue (including EUR1 million of trade and other payables held for sale) comprise mainly EUR21 million of option contracts to acquire land in the Company's Lavender Bay project, EUR7 million deferred income from government grants received and EUR14 million of client advances from villa sales.
Condensed consolidated interim statement of profit or loss and other comprehensive income
For the six-month period ended 30 June 2017
From 1 January From 1 January
2017 2016
to 30 June to 30 June
2017 2016
(Restated)
Note EUR'000 EUR'000
------------------------------------- ----- --------------- ---------------
Continuing operations
------------------------------------- ----- --------------- ---------------
Revenue 6 5,468 6,543
------------------------------------- ----- --------------- ---------------
Cost of sales 7 (5,002) (6,842)
------------------------------------- ----- --------------- ---------------
Gross profit/(loss) 466 (299)
------------------------------------- ----- --------------- ---------------
Disposal of investments 8A 4 1,197
------------------------------------- ----- --------------- ---------------
Change in valuations 8B - (109,470)
------------------------------------- ----- --------------- ---------------
Investment Manager remuneration 28.2 (4,606) (4,511)
------------------------------------- ----- --------------- ---------------
Directors' remuneration 28.1 (422) (1,071)
------------------------------------- ----- --------------- ---------------
Depreciation charge 15 (1,175) (1,103)
------------------------------------- ----- --------------- ---------------
Professional fees 11 (2,311) (2,817)
------------------------------------- ----- --------------- ---------------
Administrative and other
expenses 12 (807) (1,521)
------------------------------------- ----- --------------- ---------------
Total operating and other
expenses (9,317) (119,296)
------------------------------------- ----- --------------- ---------------
Results from operating
activities (8,851) (119,595)
------------------------------------- ----- --------------- ---------------
Finance income 26 3,968 22
------------------------------------- ----- --------------- ---------------
Finance costs (4,166) (7,015)
------------------------------------- ----- --------------- ---------------
Net finance costs (198) (6,993)
------------------------------------- ----- --------------- ---------------
Share of losses on equity-accounted
investees, net of tax 17 - (34,389)
------------------------------------- ----- --------------- ---------------
Loss before taxation (9,049) (160,977)
------------------------------------- ----- --------------- ---------------
Taxation 13 (1,090) 319
------------------------------------- ----- --------------- ---------------
Loss from continuing operations (10,139) (160,658)
------------------------------------- ----- --------------- ---------------
DISContinuED operation
------------------------------------- ----- --------------- ---------------
Profit/(loss) from discontinued
operation, net of tax 10 12,331 (2,333)
------------------------------------- ----- --------------- ---------------
Profit/(loss) 2,192 (162,991)
------------------------------------- ----- --------------- ---------------
Other comprehensive income
------------------------------------- ----- --------------- ---------------
Items that will not be
reclassified to profit
or loss
------------------------------------- ----- --------------- ---------------
Share of revaluation on
equity-accounted investees - 17
------------------------------------- ----- --------------- ---------------
Items that are or may be
reclassified subsequently
to profit or loss
------------------------------------- ----- --------------- ---------------
Foreign currency translation
differences (13,193) (2,769)
------------------------------------- ----- --------------- ---------------
Other comprehensive income,
net of tax (13,193) (2,752)
------------------------------------- ----- --------------- ---------------
Total comprehensive income (11,001) (165,743)
------------------------------------- ----- --------------- ---------------
Profit/(loss) attributable
to:
------------------------------------- ----- --------------- ---------------
Owners of the Company (2,682) (162,417)
------------------------------------- ----- --------------- ---------------
Non-controlling interests 4,874 (574)
------------------------------------- ----- --------------- ---------------
2,192 (162,991)
===================================== ===== =============== ===============
Total comprehensive income
attributable to:
------------------------------------- ----- --------------- ---------------
Owners of the Company (15,290) (164,589)
------------------------------------- ----- --------------- ---------------
Non-controlling interests 4,289 (1,154)
===================================== ===== =============== ===============
(11,001) (165,743)
===================================== ===== =============== ===============
(Loss)/earnings per share
------------------------------------- ----- --------------- ---------------
Basic and diluted loss
per share (EUR) 14 (0.003) (0.180)
------------------------------------- ----- --------------- ---------------
Basic and diluted loss
per share - Continuing
operations (EUR) 14 (0.011) (0.178)
------------------------------------- ----- --------------- ---------------
Basic and diluted earnings/(loss)
per share - Discontinued
operation (EUR) 14 0.008 (0.002)
------------------------------------- ----- --------------- ---------------
Condensed consolidated interim statement of financial position
As at 30 June 2017
31 December
30 June 2017 2016
Note EUR'000 EUR'000
------------------------------ ---- ------------ -----------
Assets
------------------------------ ---- ------------ -----------
Property, plant and equipment 15 86,607 87,647
------------------------------ ---- ------------ -----------
Investment property 16 176,553 176,548
------------------------------ ---- ------------ -----------
Deferred tax assets 24 995 996
------------------------------ ---- ------------ -----------
Non-current assets 264,155 265,191
------------------------------ ---- ------------ -----------
Trading properties 18 30,214 29,763
------------------------------ ---- ------------ -----------
Trade and other receivables 19 7,787 4,001
------------------------------ ---- ------------ -----------
Cash and cash equivalents 20 14,653 4,698
------------------------------ ---- ------------ -----------
Assets held for sale 17 106,708 162,435
------------------------------ ---- ------------ -----------
Current assets 159,362 200,897
------------------------------ ---- ------------ -----------
Total assets 423,517 466,088
============================== ==== ============ ===========
Equity
------------------------------ ---- ------------ -----------
Share capital 21 9,046 9,046
------------------------------ ---- ------------ -----------
Share premium 21 569,847 569,847
------------------------------ ---- ------------ -----------
Retained deficit (368,337) (365,689)
============================== ==== ============ ===========
Other reserves 8,075 20,683
============================== ==== ============ ===========
Equity attributable to
owners of the Company 218,631 233,887
------------------------------ ---- ------------ -----------
Non-controlling interests 4,925 17,993
------------------------------ ---- ------------ -----------
Total equity 223,556 251,880
------------------------------ ---- ------------ -----------
Liabilities
------------------------------ ---- ------------ -----------
Loans and borrowings 22 78,114 79,521
------------------------------ ---- ------------ -----------
Finance lease liabilities 23 2,912 2,934
------------------------------ ---- ------------ -----------
Deferred tax liabilities 24 25,379 24,255
------------------------------ ---- ------------ -----------
Trade and other payables 26 27,764 6,479
------------------------------ ---- ------------ -----------
Deferred revenue 25 7,108 7,230
------------------------------ ---- ------------ -----------
Non-current liabilities 141,277 120,419
------------------------------ ---- ------------ -----------
Loans and borrowings 22 11,126 12,749
------------------------------ ---- ------------ -----------
Finance lease liabilities 23 84 48
------------------------------ ---- ------------ -----------
Trade and other payables 26 13,535 43,112
------------------------------ ---- ------------ -----------
Deferred revenue 25 17,687 10,683
------------------------------ ---- ------------ -----------
Liabilities held for sale 17 16,252 27,197
------------------------------ ---- ------------ -----------
Current liabilities 58,684 93,789
------------------------------ ---- ------------ -----------
Total liabilities 199,961 214,208
------------------------------ ---- ------------ -----------
Total equity and liabilities 423,517 466,088
------------------------------ ---- ------------ -----------
Net asset value ('NAV')
per share (EUR) 27 0.24 0.26
------------------------------ ---- ------------ -----------
Condensed consolidated interim statement of changes in equity
For the six-month period ended 30 June 2017
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
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
---------------------- ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 1 January
2017 9,046 569,847 16,345 4,338 (365,689) 233,887 17,993 251,880
---------------------- ------- ------- ----------- ----------- --------- --------- --------------- ---------
TOTAL COMPREHENSIVE
INCOME
(Loss)/profit - - - - (2,682) (2,682) 4,874 2,192
---------------------- ------- ------- ----------- ----------- --------- --------- --------------- ---------
Other comprehensive
income
---------------------- ------- ------- ----------- ----------- --------- --------- --------------- ---------
Foreign currency
translation
differences - - (12,608) - - (12,608) (585) (13,193)
====================== ======= ======= =========== =========== ========= ========= =============== =========
Total other
comprehensive
income - - (12,608) - - (12,608) (585) (13,193)
---------------------- ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total comprehensive
income - - (12,608) - (2,682) (15,290) 4,289 (11,001)
---------------------- ------- ------- ----------- ----------- --------- --------- --------------- ---------
TRANSACTIONS WITH
OWNERS OF THE
COMPANY
---------------------- ------- ------- ----------- ----------- --------- --------- --------------- ---------
Contributions
and distributions
---------------------- ------- ------- ----------- ----------- --------- --------- --------------- ---------
Non-controlling
interests on capital
increases of
subsidiaries - - - - - - 95 95 ---------------------- ------- ------- ----------- ----------- --------- --------- --------------- --------- Equity-settled share-based payment arrangements - - - - 34 34 - 34 ---------------------- ------- ------- ----------- ----------- --------- --------- --------------- --------- Total contributions and distributions - - - - 34 34 95 129 ---------------------- ------- ------- ----------- ----------- --------- --------- --------------- --------- Changes in ownership interests ---------------------- ------- ------- ----------- ----------- --------- --------- --------------- --------- Disposal of subsidiary with non-controlling interests - - - - - - (17,452) (17,452) ---------------------- ------- ------- ----------- ----------- --------- --------- --------------- --------- Total changes in ownerships interests - - - - - - (17,452) (17,452) ---------------------- ------- ------- ----------- ----------- --------- --------- --------------- --------- Total transactions with owners of the Company - - - - 34 34 (17,357) (17,323) ---------------------- ------- ------- ----------- ----------- --------- --------- --------------- --------- Balance at 30 June 2017 9,046 569,847 3,737 4,338 (368,337) 218,631 4,925 223,556 ---------------------- ------- ------- ----------- ----------- --------- --------- --------------- ---------
Condensed consolidated interim statement of cash flows
For the six-month period ended 30 June 2017
From 1 January From 1 January
2017 2016
to 30 June to 30 June
2017 2016
EUR'000 EUR'000
------------------------------------------- -------------- --------------
Cash flows from operating activities
------------------------------------------- -------------- --------------
Profit/(loss) 2,192 (162,991)
------------------------------------------- -------------- --------------
Share of losses on equity-accounted
investees, net of tax - 34,389
------------------------------------------- -------------- --------------
Impairment loss on equity-accounted
investees - 109,265
------------------------------------------- -------------- --------------
Net change in fair value of
investment property - 11
------------------------------------------- -------------- --------------
Impairment loss on re-measurement
of disposal groups - 205
------------------------------------------- -------------- --------------
Gain on disposal of investment
in subsidiaries (299) (1,197)
------------------------------------------- -------------- --------------
Gain on disposal of equity-accounted
investees held for sale (4) -
------------------------------------------- -------------- --------------
Other adjustments (11,504) 11,390
------------------------------------------- -------------- --------------
(9,615) (8,928)
------------------------------------------- -------------- --------------
Changes in:
------------------------------------------- -------------- --------------
Receivables (4,563) 1,533
------------------------------------------- -------------- --------------
Payables 3,785 (30)
------------------------------------------- -------------- --------------
Cash used in operating activities (10,393) (7,425)
------------------------------------------- -------------- --------------
Tax received 9 66
------------------------------------------- -------------- --------------
Net cash used in operating
activities (10,384) (7,359)
------------------------------------------- -------------- --------------
Cash flows from investing activities
------------------------------------------- -------------- --------------
Proceeds from disposal of subsidiaries,
net of cash disposed of 26,293 -
------------------------------------------- -------------- --------------
Proceeds from disposal of equity-accounted
investees held for sale 700 -
------------------------------------------- -------------- --------------
Net acquisitions of investment
property (5) (11)
------------------------------------------- -------------- --------------
Net acquisitions of property,
plant and equipment (135) (1,684)
------------------------------------------- -------------- --------------
Net change in trading properties (258) 2,707
------------------------------------------- -------------- --------------
Net change in net assets held
for sale 641 29
=========================================== ============== ==============
Interest received - 22
=========================================== ============== ==============
Net cash from investing activities 27,236 1,063
------------------------------------------- -------------- --------------
Cash flows from financing activities
------------------------------------------- -------------- --------------
Funds received from non-controlling
interests 95 -
------------------------------------------- -------------- --------------
Change in loans and borrowings (1,922) (18,273)
=========================================== ============== ==============
Change in finance lease obligations 14 (10)
=========================================== ============== ==============
Interest paid (5,084) (5,693)
=========================================== ============== ==============
Net cash used in financing
activities (6,897) (23,976)
------------------------------------------- -------------- --------------
Net increase/(decrease) in
cash and cash equivalents 9,955 (30,272)
------------------------------------------- -------------- --------------
Cash and cash equivalents at
the beginning of the period 4,698 41,990
------------------------------------------- -------------- --------------
Effect of exchange rate fluctuations
on cash held - (480)
------------------------------------------- -------------- --------------
Cash and cash equivalents at
the end of the period 14,653 11,238
------------------------------------------- -------------- --------------
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) 14,653 11,238
------------------------------------------- -------------- --------------
Cash and cash equivalents at
the end of the period 14,653 11,238
------------------------------------------- -------------- --------------
Notes to the condensed consolidated interim financial statements
For the six-month period ended 30 June 2017
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 2017 comprise the financial statements of the Company and its subsidiaries (together referred to as the 'Group') and the Group's interests in associates.
2. Basis of preparation
(a) 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 2016. 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 28 September 2017.
(b) Basis of preparation
The condensed consolidated interim financial statements of the Company for the six-month period ended 30 June 2017 have been prepared taking into account the Company's intention to dispose of all of its assets by 31 December 2019, as further explained below. The basis of preparation used continues to be in accordance with IAS 34.
Based on the Company's new asset strategy approved by its shareholders in December 2016, the Company's objective is to dispose of all of the Company's assets by 31 December 2019. The allocation of any additional capital investment into any of the Company's projects will be substantially sourced from third party capital providers and with the sole objective of enhancing the respective asset's realisation potential until 31 December 2019. The Board expects to return the proceeds from asset disposals to shareholders, as the orderly realisation of the Company's assets progresses and taking into account the Company's liquidity position and working capital requirements. In the event that any assets are still held by the Company shortly before 31 December 2019, the Board will convene a shareholders' meeting at which appropriate resolutions for the future of the Company will be proposed.
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 2016.
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 2016.
Going concern assumptions
The Group's cash flow forecasts for the foreseeable future involve uncertainties related primarily to the exact disposal proceeds and timing of disposals of the assets expected to be disposed of. Management believes that the proceeds from forecasted asset sales will be sufficient to maintain the Group's cash flow forecasts at a positive level. Should the need arise, management is confident that it can secure additional banking facilities and/or obtain waivers on existing ones, until planned asset sales are realised and proceeds received. If for any reason the Group is unable to continue as a going concern, then this could have an impact on the Group's ability to realise assets at their recognised values and to extinguish liabilities in the normal course of business at the amounts stated in the consolidated financial statements.
5. PRINCIPAL SUBSIDIARIES
As at 30 June 2017, the Group's most significant subsidiaries were the following:
Country
of Shareholding
Name Project incorporation interest
----------------------------- ------------------- --------------- -------------
Scorpio Bay Holdings Scorpio Bay
Limited Resort Cyprus 100%
============================= =================== =============== =============
Scorpio Bay Resorts Scorpio Bay
S.A. Resort Greece 100%
============================= =================== =============== =============
Latirus Enterprises Sitia Bay
Limited Golf Resort Cyprus 80%
============================= =================== =============== =============
Iktinos Techniki Touristiki Sitia Bay
S.A. ('Iktinos') Golf Resort Greece 78%
============================= =================== =============== =============
Lavender
Xscape Limited Bay Resort Cyprus 100%
============================= =================== =============== =============
Golfing Developments Lavender
S.A. Bay Resort Greece 100%
============================= =================== =============== =============
MindCompass Overseas Kilada Hills
Limited Golf Resort Cyprus 100%
============================= =================== =============== =============
MindCompass Overseas Kilada Hills
S.A. Golf Resort Greece 100%
============================= =================== =============== =============
MindCompass Overseas Kilada Hills
Two S.A. Golf Resort Greece 100%
============================= =================== =============== =============
MindCompass Parks Kilada Hills
S.A. Golf Resort Greece 100%
============================= =================== =============== =============
Dolphin Capital Greek Kilada Hills
Collection Limited Golf Resort Cyprus 100%
============================= =================== =============== =============
DCI Holdings One Limited
('DCI H1') Aristo Developers BVIs 100%
============================= =================== =============== =============
D.C. Apollo Heights
Polo and Country Resort Apollo Heights
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. Livka Bay
('Azurna') Resort Croatia 100%
============================= =================== =============== =============
Eastern Crete Development Plaka Bay
Company S.A. Resort Greece 100%
============================= =================== =============== =============
La Vanta-
Mediterra
DolphinLux 2 S.a.r.l. Resorts Luxembourg 100%
============================= =================== =============== =============
La Vanta-
Kalkan Yapi ve Turizm Mediterra
A.S. ('Kalkan') Resorts Turkey 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%
============================= =================== =============== =============
The above shareholding interest percentages are rounded to the nearest integer.
6. revenue
From 1 January 2017 From 1 January 2016
to 30 June 2017 to 30 June 2016
Continuing Discontinued
Continuing Discontinued operations operation Total
operations operation Total (Restated) (Restated) (Restated)
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------- ----------- ------------- -------- ------------ ------------- -----------
Income from
hotel operations 4,747 - 4,747 3,582 4,319 7,901
------------------- ----------- ------------- -------- ------------ ------------- -----------
Income from
operation
of golf courses - - - - 125 125
------------------- ----------- ------------- -------- ------------ ------------- -----------
Sale of trading
and investment
properties - - - 2,510 3,585 6,095
------------------- ----------- ------------- -------- ------------ ------------- -----------
Rental income 12 - 12 52 - 52
------------------- ----------- ------------- -------- ------------ ------------- -----------
Other income 709 - 709 399 1,305 1,704
------------------- ----------- ------------- -------- ------------ ------------- -----------
Total 5,468 - 5,468 6,543 9,334 15,877
------------------- ----------- ------------- -------- ------------ ------------- -----------
7. COST OF SALES
From 1 January 2017 From 1 January 2016
to 30 June 2017 to 30 June 2016
Continuing Discontinued
Continuing Discontinued operations operation Total
operations operation Total (Restated) (Restated) (Restated)
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Cost of sales
related to:
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Hotel operations 2,308 - 2,308 1,615 2,128 3,743
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Golf course
operations - - - - 143 143
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Sales of
trading and
investment
properties - - - 1,378 2,377 3,755
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Commission
to agents
and other - - - 57 - 57
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Personnel
expenses (see
below) 2,295 254 2,549 2,118 2,620 4,738
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Branding management
fees 326 - 326 1,189 - 1,189
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Other operating
expenses 73 114 187 485 12 497
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Total 5,002 368 5,370 6,842 7,280 14,122
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Personnel expenses
Continuing operations
From 1 January 2017
to 30 June 2017
=======================================
Hotel Project
& leisure maintenance
operations & development Total
--------------------------------- ------------ --------------- --------
EUR'000 EUR'000 EUR'000
--------------------------------- ------------ --------------- --------
Wages and salaries 1,682 97 1,779
--------------------------------- ------------ --------------- --------
Compulsory social security
contributions 419 15 434
--------------------------------- ------------ --------------- --------
Other personnel costs 74 8 82
--------------------------------- ------------ --------------- --------
Total 2,175 120 2,295
--------------------------------- ------------ --------------- --------
The average number of employees
employed by the Group during
the period was 149 22 171
--------------------------------- ------------ --------------- --------
Discontinued operation
From 1 January 2017
to 30 June 2017
=======================================
Hotel Project
& leisure maintenance
operations & development Total
--------------------------------- ------------ --------------- --------
EUR'000 EUR'000 EUR'000
--------------------------------- ------------ --------------- --------
Wages and salaries - 174 174
--------------------------------- ------------ --------------- --------
Compulsory social security
contributions - 37 37
--------------------------------- ------------ --------------- --------
Other personnel costs - 43 43
--------------------------------- ------------ --------------- --------
Total - 254 254
--------------------------------- ------------ --------------- --------
The average number of employees
employed by the Group during
the period was - 33 33
--------------------------------- ------------ --------------- --------
Continuing operations
From 1 January 2016
to 30 June 2016
--------------------------------- ---------------------------------------
Hotel Project
& leisure maintenance
operations & development Total
--------------------------------- ------------ --------------- --------
EUR'000 EUR'000 EUR'000
--------------------------------- ------------ --------------- --------
Wages and salaries 1,407 233 1,640
--------------------------------- ------------ --------------- --------
Compulsory social security
contributions 343 50 393
--------------------------------- ------------ --------------- --------
Other personnel costs 73 12 85
--------------------------------- ------------ --------------- --------
Total 1,823 295 2,118
--------------------------------- ------------ --------------- --------
The average number of employees
employed by the Group during
the period was 128 30 158
--------------------------------- ------------ --------------- --------
Discontinued operation
From 1 January 2016
to 30 June 2016
--------------------------------- ---------------------------------------
Hotel Project
& leisure maintenance
operations & development Total
--------------------------------- ------------ --------------- --------
EUR'000 EUR'000 EUR'000
--------------------------------- ------------ --------------- --------
Wages and salaries 836 1,079 1,915
--------------------------------- ------------ --------------- --------
Compulsory social security
contributions 93 166 259
--------------------------------- ------------ --------------- --------
Other personnel costs 364 82 446
--------------------------------- ------------ --------------- --------
Total 1,293 1,327 2,620
--------------------------------- ------------ --------------- --------
The average number of employees
employed by the Group during
the period was 269 110 379
--------------------------------- ------------ --------------- --------
8. INCOME AND EXPENSES
A. DISPOSAL OF INVESTMENTS
From 1 January 2017 From 1 January 2016
to 30 June 2017 to 30 June 2016
---------------------- ----- ------------------------------------ ----------------------------------------
Continuing Discontinued
Continuing Discontinued operations operation Total
Note operations operation Total (Restated) (Restated) (Restated)
---------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
---------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
Gain on disposal
of investment
in subsidiaries 29 - 299 299 1,197 - 1,197
---------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
Gain on disposal
of equity-accounted
investees
held for
sale 17 4 - 4 - - -
---------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
Total 4 299 303 1,197 - 1,197
---------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
B. CHANGE IN VALUATIONS
From 1 January 2017 From 1 January 2016
to 30 June 2017 to 30 June 2016
------------------- ----- ------------------------------------ ----------------------------------------
Continuing Discontinued
Continuing Discontinued operations operation Total
Note operations operation Total (Restated) (Restated) (Restated)
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
Net change
in fair
value of
investment
property 10 - - - - (11) (11)
------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
Impairment
loss on
re-measurement
of disposal
groups 17 - - - (205) - (205)
------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
Impairment
loss on
equity-accounted
investees 17 - - - (109,265) - (109,265)
------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
Total - - - (109,470) (11) (109,481)
------------------- ----- ----------- ------------- -------- ------------ ------------- -----------
9. 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.
Hotel & Reportable
leisure Construction segments'
operations & development Other totals
------------------ -------------------------- -------------------------- -------------------------- --------------------------
Continuing Discontinued Continuing Discontinued Continuing Discontinued Continuing Discontinued
operations operation operations operation operations operation operations operation
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
30 June 2017
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Revenue 4,747 - 8 - 713 - 5,468 -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Cost of sales (4,838) - (119) (368) (45) - (5,002) (368)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Investment
Manager
remuneration - - - - (4,606) - (4,606) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Directors'
remuneration - - - - (422) - (422) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Depreciation
charge (1,171) - (4) - - - (1,175) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Professional
fees - - (88) (29) (2,223) (53) (2,311) (82)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Administrative
and other
expenses - - (62) (80) (745) (853) (807) (933)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Gain on disposal
of investment
in subsidiaries - - - - - 299 - 299
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Gain on disposal
of
equity-accounted
investees
held for
sale - - 4 - - - 4 -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Results from
operating
activities (1,262) - (261) (477) (7,328) (607) (8,851) (1,084)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Finance income - - 85 - 3,883 13,415 3,968 13,415
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Finance costs (1,761) - (770) - (1,635) - (4,166) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Net finance
(costs)/income (1,761) - (685) - 2,248 13,415 (198) 13,415
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
(Loss)/profit
before taxation (3,023) - (946) (477) (5,080) 12,808 (9,049) 12,331
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Taxation - - (8) - (1,082) - (1,090) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
(Loss/profit (3,023) - (954) (477) (6,162) 12,808 (10,139) 12,331
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Reportable
Hotel & leisure Construction segments'
operations & development Other totals
------------------ -------------------------- -------------------------- -------------------------- --------------------------
Continuing Discontinued Continuing Discontinued Continuing Discontinued Continuing Discontinued
operations operation operations operation operations operation operations operation
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
30 June
2016 (Restated)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Revenue 3,582 4,444 2,517 3,585 444 1,305 6,543 9,334
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Cost of
sales (4,213) (4,220) (2,268) (3,030) (361) (30) (6,842) (7,280)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Investment
Manager
remuneration - - - - (4,511) - (4,511) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Directors'
remuneration - - - - (1,071) - (1,071) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Depreciation
charge (1,103) (116) - (182) - - (1,103) (298)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Professional
fees - - (97) (1,139) (2,720) (98) (2,817) (1,237)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Administrative
and other
expenses - - (117) (168) (1,404) (276) (1,521) (444)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Gain on
disposal
of investment
in subsidiaries - - - - 1,197 - 1,197 -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Net change
in fair
value of
investment
property - - - - - (11) - (11)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Impairment
loss on
equity-accounted
investees - - (109,265) - - - (109,265) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Impairment
loss on
re-measurement
of disposal
groups (205) - - - - - (205) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Results
from operating
activities (1,939) 108 (109,230) (934) (8,426) 890 (119,595) 64
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Finance
income - - - - 22 - 22 -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Finance
costs (2,129) - (237) (1,553) (4,649) (844) (7,015) (2,397)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Net finance
costs (2,129) - (237) (1,553) (4,627) (844) (6,993) (2,397)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Share of
profit
on
equity-accounted
investees,
net of
tax - - (34,389) - - - (34,389) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
(Loss)/profit
before
taxation (4,068) 108 (143,856) (2,487) (13,053) 46 (160,977) (2,333)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Taxation - - 46 - 273 - 319 -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
(Loss)/profit (4,068) 108 (143,810) (2,487) (12,780) 46 (160,658) (2,333)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Geographical segments
Information in relation to the geographical regions in which the Group operates, is set below:
Reportable
Americas1 segment
South-East Consolidated
(Discontinued) Europe(2) Other(3) totals Adjustments(4) totals
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------------- --------------- ---------- -------- ---------- -------------- ------------
30 June 2017
----------------------------------------------------------------------------------------------------------
Property, plant
and equipment - 86,607 - 86,607 - 86,607
========================= =============== ========== ======== ========== ============== ============
Investment property - 176,553 - 176,553 - 176,553
========================= =============== ========== ======== ========== ============== ============
Trading properties - 30,214 - 30,214 - 30,214
========================= =============== ========== ======== ========== ============== ============
Cash and cash
equivalents - 5,088 9,565 14,653 - 14,653
========================= =============== ========== ======== ========== ============== ============
Assets held for
sale 893 105,815 - 106,708 - 106,708
========================= =============== ========== ======== ========== ============== ============
Intra-group debit
balances - 50,767 581,489 632,256 (632,256) -
========================= =============== ========== ======== ========== ============== ============
Other assets - 6,825 2,734 9,559 - 9,559
========================= =============== ========== ======== ========== ============== ============
Total assets 893 461,869 593,788 1,056,550 (632,256) 424,294
========================= =============== ========== ======== ========== ============== ============
Loans and borrowings - 89,240 - 89,240 - 89,240
========================= =============== ========== ======== ========== ============== ============
Finance lease
liabilities - 2,996 - 2,996 - 2,996
========================= =============== ========== ======== ========== ============== ============
Deferred tax
liabilities - 25,379 - 25,379 - 25,379
========================= =============== ========== ======== ========== ============== ============
Liabilities held
for sale - 16,252 - 16,252 - 16,252
========================= =============== ========== ======== ========== ============== ============
Intra-group credit
balances - 428,509 203,747 632,256 (632,256) -
========================= =============== ========== ======== ========== ============== ============
Other liabilities - 63,308 3,563 66,871 - 66,871
========================= =============== ========== ======== ========== ============== ============
Total liabilities - 625,684 207,310 832,994 (632,256) 200,738
========================= =============== ========== ======== ========== ============== ============
Revenue - 5,468 - 5,468 - 5,468
========================= =============== ========== ======== ========== ============== ============
Cost of sales - (5,002) - (5,002) - (5,002)
========================= =============== ========== ======== ========== ============== ============
Investment Manager
remuneration - (700) (3,906) (4,606) - (4,606)
========================= =============== ========== ======== ========== ============== ============
Other operating
expenses - (2,851) (1,860) (4,711) - (4,711)
========================= =============== ========== ======== ========== ============== ============
Net finance cost - (143) (55) (198) - (198)
========================= =============== ========== ======== ========== ============== ============
Loss before taxation - (3,228) (5,821) (9,049) - (9,049)
========================= =============== ========== ======== ========== ============== ============
Taxation - (1,090) - (1,090) - (1,090)
========================= =============== ========== ======== ========== ============== ============
Loss from continuing
operations - (4,318) (5,821) (10,139) - (10,139)
========================= =============== ========== ======== ========== ============== ============
Profit from discontinued
operation, net
of tax 12,331 - - 12,331 - 12,331
========================= =============== ========== ======== ========== ============== ============
Profit/(loss) 12,331 (4,318) (5,821) 2,192 - 2,192
========================= =============== ========== ======== ========== ============== ============
Reportable
Americas1 segment
South-East Consolidated
(Discontinued) Europe(2) Other(3) totals Adjustments(4) totals
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
----------------------- --------------- ---------- -------- ---------- -------------- ------------
31 December 2016
--------------------------------------------------------------------------------------------------------
Property, plant
and equipment - 87,647 - 87,647 - 87,647
======================= =============== ========== ======== ========== ============== ============
Investment property - 176,548 - 176,548 - 176,548
======================= =============== ========== ======== ========== ============== ============
Trading properties - 29,763 - 29,763 - 29,763
======================= =============== ========== ======== ========== ============== ============
Cash and cash
equivalents - 3,415 1,283 4,698 - 4,698
======================= =============== ========== ======== ========== ============== ============
Assets held
for sale 55,909 106,526 - 162,435 - 162,435
======================= =============== ========== ======== ========== ============== ============
Intra-group
debit balances 15,277 51,899 589,489 656,665 (656,665) -
======================= =============== ========== ======== ========== ============== ============
Other assets - 4,112 885 4,997 - 4,997
----------------------- --------------- ---------- -------- ---------- -------------- ------------
Total assets 71,186 459,910 591,657 1,122,753 (656,665) 466,088
----------------------- --------------- ---------- -------- ---------- -------------- ------------
Loans and borrowings - 92,270 - 92,270 - 92,270
======================= =============== ========== ======== ========== ============== ============
Finance lease
liabilities - 2,982 - 2,982 - 2,982
======================= =============== ========== ======== ========== ============== ============
Deferred tax
liabilities - 24,255 - 24,255 - 24,255
======================= =============== ========== ======== ========== ============== ============
Liabilities
held for sale 10,800 16,397 - 27,197 - 27,197
======================= =============== ========== ======== ========== ============== ============
Intra-group
credit balances 170,031 425,771 60,863 656,665 (656,665) -
======================= =============== ========== ======== ========== ============== ============
Other liabilities - 64,678 2,826 67,504 - 67,504
----------------------- --------------- ---------- -------- ---------- -------------- ------------
Total liabilities 180,831 626,353 63,689 870,873 (656,665) 214,208
----------------------- --------------- ---------- -------- ---------- -------------- ------------
30 June 2016
(Restated)
======================= =============== ========== ======== ========== ============== ============
Revenue - 6,543 - 6,543 - 6,543
======================= =============== ========== ======== ========== ============== ============
Cost of sales - (6,842) - (6,842) - (6,842)
======================= =============== ========== ======== ========== ============== ============
Disposal of
investments - 1,197 - 1,197 - 1,197
======================= =============== ========== ======== ========== ============== ============
Change in valuations - (109,470) - (109,470) - (109,470)
======================= =============== ========== ======== ========== ============== ============
Share of losses
on equity-accounted
investees, net
of tax - (34,389) - (34,389) - (34,389)
======================= =============== ========== ======== ========== ============== ============
Investment Manager
remuneration - (640) (3,871) (4,511) - (4,511)
======================= =============== ========== ======== ========== ============== ============
Other operating
expenses - (3,491) (3,021) (6,512) - (6,512)
======================= =============== ========== ======== ========== ============== ============
Net finance
cost - (5,006) (1,987) (6,993) - (6,993)
======================= =============== ========== ======== ========== ============== ============
Loss before
taxation - (152,098) (8,879) (160,977) - (160,977)
======================= =============== ========== ======== ========== ============== ============
Taxation - 319 - 319 - 319
======================= =============== ========== ======== ========== ============== ============
Loss from continuing
operations - (151,779) (8,879) (160,658) - (160,658)
======================= =============== ========== ======== ========== ============== ============
Loss from discontinued
operation, net
of tax (2,333) - - (2,333) - (2,333)
======================= =============== ========== ======== ========== ============== ============
Loss (2,333) (151,779) (8,879) (162,991) - (162,991)
======================= =============== ========== ======== ========== ============== ============
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 hospitality sector remained strong during 2016 and the first half of 2017, 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
While throughout 2016 Greek economic growth was essentially flat,Greece's successful return to the capital markets sent a clear sign that the country is finally recovering following its recent bailout program. Greece returned to the bond markets for the first time since 2014, pricing EUR3 billion of new five-year bonds at a yield of 4.625%. According to Hellenic Financial Council (the 'Council'), the 0.8% year-on-year increase in GDP for the second quarter of 2017 is a positive development. In respect of the State Budget execution, the Council notes that for the January-July 2017 period primary surplus stands at 1.7% of GDP higher versus the 1.5% achieved in the same period in 2016 and the targeted 1.2% for the period.
Greece's tourism sector is expected to have a significant impact on the recovery of the country's economy and on curbing the external trade deficit. Official data released by the Greek Tourism Confederation confirmed that 2016 was an all-time record year for Greek tourism as the number of tourism arrivals in Greece increased 9% compared to 2015. In 2017 air, road and sea arrival indicators show significant increases. According to data of the Greek Tourism Confederation, in the first half of 2017, tourism arrivals reached 11 million, incoming travellers were up by 6.6% and travel receipts rose by 7.1%. Summer holiday-makers from the Eurozone, Russia and the USA are leading the increase in arrivals and revenues. In addition, high levels of consumer confidence in most Greek tourism markets indicate potential for high demand for the Greek tourism product.
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. The emerging economic recovery has been reinforced since then with the economy expanding by 3.5% year-on-year in real terms in the second quarter of of 2017, driven mainly by improved levels of private consumption and a record year for the tourism industry.
The available data for the tourism industry highlighted, once again, that tourism was amongst one of the key catalysts for the country's 2016 economic performance, as revenues reached EUR2.4 billion at the end of the year surpassing the total tourism revenues recorded throughout 2015 (EUR2.1 million) by 11.9%. Total arrivals amounted to 3.2 million in 2016 versus 2.7 million in the previous year. For the period of January - July 2017 arrivals of tourists totalled 2 million compared to 1.7 million in the corresponding period of 2016, recording an increase of 14.8% and outnumbering the total arrivals ever recorded in Cyprus during the first seven months of the year, as reported by the country's Statistical Service. During the first eight months of 2017, real estate market activity accelerated on the back of incentives and debt-asset swaps by 20% year-on-year. Recognising the growing interest, Cyprus has focused on modernising legislation, introducing tax incentives and speeding up licensing procedures.
10. DISCONTINUED OPERATION
During the second half of 2016, the Group sold Playa Grande (owner of 'Amanera, Dominican Republic') and also committed to a plan to sell Pearl (owner of 'Pearl Island, Republic of Panama'). Playa and Pearl constituted the operations of the Group in the geographical area of Americas, which as at 31 December 2016, is presented as a discontinued operation. Pearl is also classified as a disposal group held for sale as at 31 December 2016. During the period ended 30 June 2017, Pearl was disposed of.
As at 30 June 2016, Americas segment was not classified as a discontinued operation. The comparative condensed consolidated interim statement of profit or loss and other comprehensive income has been restated to show the discontinued operation separately from continuing operations.
Results of discontinued operation
From 1 January From 1 January
2017 2016
to 30 June to 30 June
2017 2016
(Restated)
Note EUR'000 EUR'000
---------------------------------- ----- --------------- ---------------
Revenue 6 - 9,334
---------------------------------- ----- --------------- ---------------
Expenses
---------------------------------- ----- --------------- ---------------
Cost of sales 7 (368) (7,280)
---------------------------------- ----- --------------- ---------------
Change in valuations 8B - (11)
---------------------------------- ----- --------------- ---------------
Depreciation charge - (298)
---------------------------------- ----- --------------- ---------------
Professional fees 11 (82) (1,237)
---------------------------------- ----- --------------- ---------------
Administrative and other
expenses 12 (933) (444)
---------------------------------- ----- --------------- ---------------
Net finance income/(costs) 13,415 (2,397)
---------------------------------- ----- --------------- ---------------
Results from operating
activities 12,032 (2,333)
---------------------------------- ----- --------------- ---------------
Taxation 13 - -
---------------------------------- ----- --------------- ---------------
Results from operating
activities, net of tax 12,032 (2,333)
---------------------------------- ----- --------------- ---------------
Gain on disposal of discontinued
operation 8A 299 -
---------------------------------- ----- --------------- ---------------
Profit/(loss) from discontinued
operation, net of tax 12,331 (2,333)
---------------------------------- ----- --------------- ---------------
Cash flows used in discontinued operation
From 1 January From 1 January
2017 2016
to 30 June to 30 June
2017 2016
EUR'000 EUR'000
---------------------------- --------------- ---------------
Net cash (used in)/from
operating activities (26,474) 3,439
----------------------------- --------------- ---------------
Net cash from investing
activities 26,293 453
----------------------------- --------------- ---------------
Net cash used in financing
activities - (3,663)
----------------------------- --------------- ---------------
Net cash flows for the
period (181) 229
----------------------------- --------------- ---------------
11. PROFESSIONAL FEES
From 1 January 2017 From 1 January 2016
to 30 June 2017 to 30 June 2016
Continuing Discontinued
Continuing Discontinued operations operation Total
operations operation Total (Restated) (Restated) (Restated)
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Legal fees 555 19 574 445 51 496
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Auditors'
remuneration
(see below) 166 28 194 182 30 212
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Accounting
expenses 140 - 140 142 - 142
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Project
design and
development
fees 1,011 21 1,032 1,146 1,124 2,270
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Consultancy
fees 169 - 169 400 - 400
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Administrator
fees 35 - 35 120 - 120
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Other professional
fees 235 14 249 382 32 414
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Total 2,311 82 2,393 2,817 1,237 4,054
-------------------- ----------- ------------- -------- ------------ ------------- -----------
From 1 January 2017 From 1 January 2016
to 30 June 2017 to 30 June 2016
Continuing Discontinued
Continuing Discontinued operations operation Total
operations operation Total (Restated) (Restated) (Restated)
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
---------------- ----------- ------------- -------- ------------ ------------- -----------
Auditors'
remuneration
comprises
the following
fees:
---------------- ----------- ------------- -------- ------------ ------------- -----------
Audit and
other audit
related
services 134 28 162 150 30 180
---------------- ----------- ------------- -------- ------------ ------------- -----------
Tax and
advisory 32 - 32 32 - 32
---------------- ----------- ------------- -------- ------------ ------------- -----------
Total 166 28 194 182 30 212
---------------- ----------- ------------- -------- ------------ ------------- -----------
12. ADMINISTRATIVE AND OTHER EXPENSES
From 1 January
2017 to 30 June From 1 January 2016
2017 to 30 June 2016
Continuing Discontinued
Continuing Discontinued operations operation Total
operations operation Total (Restated) (Restated) (Restated)
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Travelling
and accommodation 139 - 139 205 69 274
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Insurance 31 - 31 29 29 58
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Repairs and
maintenance 61 5 66 74 54 128
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Marketing and
advertising
expenses 76 14 90 220 161 381
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Rents 68 23 91 84 91 175
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Other 432 891 1,323 909 40 949
-------------------- ----------- ------------- -------- ------------ ------------- -----------
Total 807 933 1,740 1,521 444 1,965
-------------------- ----------- ------------- -------- ------------ ------------- -----------
13. TAXATION
From 1 January From 1 January
2017 2016
to 30 June to 30 June
2017 2016
(Restated)
EUR'000 EUR'000
Income tax 35 (43)
------------------------------------ --------------- ---------------
Net deferred tax (1,125) (276)
------------------------------------ --------------- ---------------
Taxation recognised in profit
or loss - continuing operations 1,090 (319)
------------------------------------ --------------- ---------------
Taxation recognised in profit
or loss - discontinued operations - -
------------------------------------ --------------- ---------------
Total 1,090 (319)
------------------------------------ --------------- ---------------
14. (LOSS)/EARNINGS PER SHARE
Basic (loss)/earnings per share
Basic (loss)/earnings per share is calculated by dividing the (loss)/profit attributable to owners of the Company by the weighted average number of common shares outstanding during the period.
From 1 January 2017 From 1 January 2016
to 30 June 2017 to 30 June 2016
------------------------------------ ----------------------------------------
Continuing Discontinued
Continuing Discontinued operations operation Total
operations operation Total (Restated) (Restated) (Restated)
'000 '000 '000 '000 '000 '000
----------------------- ----------- ------------- -------- ------------ ------------- -----------
(Loss)/profit
attributable
to owners
of the Company
(EUR) (10,051) 7,369 (2,682) (160,585) (1,832) (162,417)
----------------------- ----------- ------------- -------- ------------ ------------- -----------
Number of
weighted
average common
shares outstanding 904,627 904,627 904,627 904,627 904,627 904,627
----------------------- ----------- ------------- -------- ------------ ------------- -----------
Basic (loss)/earnings per share (EUR) (0.011) 0.008 (0.003) (0.178) (0.002) (0.180) ----------------------- ----------- ------------- -------- ------------ ------------- -----------
(Loss)/profit attributable to owners of the Company
From 1 January 2017 From 1 January 2016
to 30 June 2017 to 30 June 2016
------------------------------------ ----------------------------------------
Continuing Discontinued
Continuing Discontinued operations operation Total
operations operation Total (Restated) (Restated) (Restated)
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
--------------------- ----------- ------------- -------- ------------ ------------- -----------
(Loss)/profit
attributable
to owners
of the Company (10,051) 7,369 (2,682) (160,585) (1,832) (162,417)
--------------------- ----------- ------------- -------- ------------ ------------- -----------
(Loss)/profit
attributable
to non-controlling
interests (88) 4,962 4,874 (73) (501) (574)
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Total (10,139) 12,331 2,192 (160,658) (2,333) (162,991)
--------------------- ----------- ------------- -------- ------------ ------------- -----------
Weighted average number of common shares outstanding
From 1 January From 1 January
2017 2016
to 30 June to 30 June
2017 2016
(Restated)
'000 '000
--------------------------- --------------- ---------------
Outstanding common shares
at the beginning and end
of the period 904,627 904,627
--------------------------- --------------- ---------------
Diluted (loss)/earnings per share
Diluted (loss)/earnings per share is calculated by adjusting the (loss)/profit attributable to owners and the number of common shares outstanding to assume conversion of all dilutive potential shares. As of 30 June 2017 and 31 December 2016, the diluted (loss)/earnings per share is the same as the basic (loss)/earnings 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. The Convertible Bonds were repaid on the scheduled maturing date in March 2016 and all warrants expired on 3 January 2017.
15. PROPERTY, PLANT AND EQUIPMENT
Land and buildings Other Total
EUR'000 EUR'000 EUR'000
30 June 2017
------------------------------------ ------------------- --------- ---------
Cost or revalued amount
------------------------------------ ------------------- --------- ---------
At beginning of period 99,561 5,409 104,970
------------------------------------ ------------------- --------- ---------
Direct acquisitions 67 87 154
------------------------------------ ------------------- --------- ---------
Direct disposals - (27) (27)
------------------------------------ ------------------- --------- ---------
At end of period 99,628 5,469 105,097
------------------------------------ ------------------- --------- ---------
Depreciation and impairment losses
------------------------------------ ------------------- --------- ---------
At beginning of period 14,381 2,942 17,323
------------------------------------ ------------------- --------- ---------
Direct disposals - (8) (8)
------------------------------------ ------------------- --------- ---------
Depreciation charge for the period 923 252 1,175
------------------------------------ ------------------- --------- ---------
At end of period 15,304 3,186 18,490
------------------------------------ ------------------- --------- ---------
Carrying amounts 84,324 2,283 86,607
------------------------------------ ------------------- --------- ---------
Under construction Land and buildings Other Total
EUR'000 EUR'000 EUR'000 EUR'000
31 December 2016
------------------------------------------------------ ------------------- ------------------- --------- ---------
Cost or revalued amount
------------------------------------------------------ ------------------- ------------------- --------- ---------
At beginning of year 12,227 176,426 30,509 219,162
------------------------------------------------------ ------------------- ------------------- --------- ---------
Direct acquisitions 1,041 153 1,875 3,069
------------------------------------------------------ ------------------- ------------------- --------- ---------
Direct disposals - (576) (926) (1,502)
------------------------------------------------------ ------------------- ------------------- --------- ---------
Disposals through disposal of subsidiary companies - (69,101) (24,220) (93,321)
------------------------------------------------------ ------------------- ------------------- --------- ---------
Reclassification to assets held for sale (2,294) (20,291) (5,179) (27,764)
------------------------------------------------------ ------------------- ------------------- --------- ---------
Transfers to trading property (see note 18) - (2,266) (252) (2,518)
------------------------------------------------------ ------------------- ------------------- --------- ---------
Transfer (to)/from other assets (11,311) 8,078 3,233 -
------------------------------------------------------ ------------------- ------------------- --------- ---------
Revaluation adjustment - 5,796 - 5,796
------------------------------------------------------ ------------------- ------------------- --------- ---------
Exchange difference 337 1,342 369 2,048
------------------------------------------------------ ------------------- ------------------- --------- ---------
At end of year - 99,561 5,409 104,970
------------------------------------------------------ ------------------- ------------------- --------- ---------
Depreciation and impairment losses
------------------------------------------------------ ------------------- ------------------- --------- ---------
At beginning of year - 26,126 6,021 32,147
------------------------------------------------------ ------------------- ------------------- --------- ---------
Direct disposals - - (849) (849)
------------------------------------------------------ ------------------- ------------------- --------- ---------
Disposals through disposal of subsidiary companies - (12,363) (2,658) (15,021)
------------------------------------------------------ ------------------- ------------------- --------- ---------
Reclassification to assets held for sale - (1,420) (330) (1,750 )
------------------------------------------------------ ------------------- ------------------- --------- ---------
Transfer to trading property (see note 18) - - (103) (103)
------------------------------------------------------ ------------------- ------------------- --------- ---------
Depreciation charge for the year-continuing
operations - 1,614 670 2,284
------------------------------------------------------ ------------------- ------------------- --------- ---------
Depreciation charge for the year - discontinued
operation - 358 138 496
------------------------------------------------------ ------------------- ------------------- --------- ---------
Impairment loss - 780 - 780 ------------------------------------------------------ ------------------- ------------------- --------- --------- Reversal of impairment loss - (872) - (872) ------------------------------------------------------ ------------------- ------------------- --------- --------- Exchange difference - 158 53 211 ------------------------------------------------------ ------------------- ------------------- --------- --------- At end of year - 14,381 2,942 17,323 ------------------------------------------------------ ------------------- ------------------- --------- --------- Carrying amounts - 85,180 2,467 87,647 ====================================================== =================== =================== ========= =========
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 2016.
16. INVESTMENT PROPERTY
30 June
Note 2017 31 December 2016
EUR'000 EUR'000
--------------------------------- ----- -------- -----------------
At beginning of period/year 176,548 340,853
--------------------------------- ----- -------- -----------------
Direct acquisitions 5 11
--------------------------------- ----- -------- -----------------
Disposals through disposal
of subsidiary companies - (74,644)
--------------------------------- ----- -------- -----------------
Transfers to trading properties 18 - (273)
--------------------------------- ----- -------- -----------------
Reclassification to assets
held for sale - (28,135)
--------------------------------- ----- -------- -----------------
Exchange difference - 3,320
--------------------------------- ----- -------- -----------------
Fair value adjustment -
continuing operations - (22,126)
--------------------------------- ----- -------- -----------------
Fair value adjustment -
discontinued operation - (42,458)
--------------------------------- ----- -------- -----------------
At end of period/year 176,553 176,548
--------------------------------- ----- -------- -----------------
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 2016.
17. DISPOSAL GROUPS HELD FOR SALE
As at 30 June 2017, the Company remains committed to its plan to sell five disposal groups which are presented as held for sale. These disposal groups are: Iktinos (owner of 'Sitia Bay') and Porto Heli (owner of 'Nikki Beach') in Greece, Azurna (owner of 'Livka Bay') in Croatia, Kalkan (owner of 'La Vanta') in Turkey and DCI Holdings Two Limited ('DCI H2') (owner of Aristo Developers Limited ('Aristo') in Cyprus. 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 DCI H2) and 'Other' (Iktinos and Azurna) operating segments.
As at 31 December 2016, Pearl was also presented as held for sale with its disposal being completed during the period ended 30 June 2017. Pearl was part of the discontinued geographical operation of Americas and was also included in the operating segments of 'Construction & development' and 'Other'.
Impairment losses relating to the disposal group
No impairment losses have been recognised during the period ended 30 June 2017 for write-downs of the disposal groups to the lower of their carrying amount and their fair value less costs to sell (30 June 2016: EUR205 thousand). The impairment losses have been recognised and included in 'Change in valuations' (see note 8B).
Assets and liabilities of disposal groups held for sale
As at 30 June 2017, the disposal groups comprised the following assets and liabilities:
Porto
Iktinos Azurna Kalkan Heli DCI
disposal disposal disposal disposal H2 disposal
group group group group group Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Property, plant
and equipment 6,699 - 9 - - 6,708
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Investment property 14,537 32,969 - - - 47,506
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Equity-accounted
investees - - - 783 42,694 43,477
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Trading properties - - 6,901 - - 6,901
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Trade and other
receivables - 6 1,153 - - 1,159
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Cash and cash
equivalents 50 14 - - - 64
---------------------- ---------- ---------- ---------- ---------- ------------- --------
21,286 32,989 8,063 783 42,694 105,815
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Available-for-sale
financial assets - - - - - 893
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Assets held for
sale 106,708
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Loans and borrowings - 8,163 - - - 8,163
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Deferred tax
liabilities 3,062 3,707 - - - 6,769
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Trade and other
payables 184 959 177 - - 1,320
---------------------- ---------- ---------- ---------- ---------- ------------- --------
Liabilities held
for sale 3,246 12,829 177 - - 16,252
---------------------- ---------- ---------- ---------- ---------- ------------- --------
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. Itacare's shareholders have decided to dispose of all assets and after a series of asset sales/swaps Itacare now owns two development sites with the Company's shareholding being 13%. The Company is currently in advanced discussions for the sale of its shareholding in Itacare, for a US$1 million payment in cash, with the transaction expected to close by the end of 2017.
DCI H2 disposal group
During 2016, the Company's investment in DCI H2, owner of Aristo, decreased significantly, as a result of a share of loss and an impairment loss amounting to EUR34,389 thousand and EUR109,265 thousand, respectively. The share of losses comprised the result of the loan restructuring arrangement between Aristo and Bank of Cyprus, whereby a loss from the redemption of such bank loans emerged through their settlement with property swapped. The impairment loss has been recognised to bring the DCI H2 investment to its recoverable amount of EUR45 million, which represented the originally agreed proceeds to the Company from the disposal of its investment, as further described below.
On 29 September 2016, the Company reached an agreement to dispose of its 49.75% shareholding in DCI H2 to an entity controlled by Theodoros Aristodemou ('TA'), DCI H2' s current controlling shareholder. The disposal would have been 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. The Company was 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 occurred by 29 December 2016 and the second anniversary from the transaction). The acquisition shares would have been kept in escrow and transferred to the acquirer in line with the collection of the consideration by the Company, apart from a percentage which would have been remained escrowed until the final settlement of the consideration. In the event that any payment became overdue for more than three months either party would have the right to terminate the sales agreement, in which case all the shares kept in escrow together with any corresponding dividend distributions would have been retained by the Company. On 6 September 2016, the Company received EUR1.1 million in exchange for 105 DCI H2 shares, resulting in a gain on disposal of EUR151 thousand and to a reduction in the Company's holding in DCI H2 to 48.7%.
On 13 February 2017, the Company signed a supplementary agreement amending the date of execution of the agreement to the earlier of a) 30 April 2017 and b) the 'Stay Period', the date falling 5 Business days after the issuance of the Court verdict for the current trial between the Attorney General and the Bank of Cyprus Public Company Ltd (in which TA is a defendant). Completion was to take place upon the expiration of the Stay Period, subject to the full receipt by the Company of any outstanding amount from the consideration. Upon execution of this agreement an amount of EUR700 thousand was paid to the Company (received on 14 February 2017) in exchange for 77 shares in DCI H2, resulting in a gain on disposal of EUR4 thousand and to a reduction in the Company's holding in DCI H2 to 47.9%. In the event that by 30 April 2017 a court verdict had not been issued, then the Stay Period would have been extended until 30 June of 2017, provided that TA made by the 30 April 2017 a payment of EUR300 thousand in exchange for 33 DCIH2 shares.
On 3 May 2017, the Company decided to terminate the agreement with TA to dispose its Aristo shares, as a result of TA's failure to settle deferred payments by 30 April 2017. The Company will retain the unpaid portion of its Aristo shares, which corresponds on 3 May 2017 to 47.9%. The Board remains committed to dispose Aristo and realise value from the remaining shareholding.
As at 30 June 2017 and as at 31 December 2016, the Company's holding of 47.9% and 48.7%, respectively has been classified as asset held for sale.
As at 31 December 2016, the disposal groups comprised the following assets and liabilities:
Porto DCI
Iktinos Azurna Kalkan Heli H2 Pearl
disposal disposal disposal disposal disposal disposal
group group group group group group Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Property, plant
and equipment 6,699 - 23 - - 26,014 32,736
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Investment property 14,541 32,937 - - - 28,135 75,613
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Equity-accounted
investees - - - 783 43,391 - 44,174
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Trading properties - - 6,850 - - - 6,850
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Trade and other
receivables - 7 1,269 - - 627 1,903
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Cash and cash
equivalents 11 8 7 - - 183 209
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
21,251 32,952 8,149 783 43,391 54,959 161,485
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Available-for-sale
financial assets - - - - - - 950
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Assets held for
sale 162,435
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Loans and borrowings - 8,165 94 - - - 8,259
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Deferred tax liabilities 3,062 3,633 - - - 1,239 7,934
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Trade and other
payables 274 959 210 - - 9,561 11,004
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Liabilities held
for sale 3,336 12,757 304 - - 10,800 27,197
-------------------------- ---------- ---------- ---------- ---------- ---------- ---------- --------
Cumulative income or expenses included in other comprehensive income
An amount of EUR10,270 thousand loss (30.6.2016: Nil) 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 2016.
18. Trading properties
31 December
30 June 2017 2016
EUR'000 EUR'000
------------------------------------ ------------ -----------
At beginning of period/year 29,763 37,387
------------------------------------ ------------ -----------
Net direct acquisitions/(disposals) 258 (3,200)
------------------------------------ ------------ -----------
Reversal of/(concession/write
off) of land 193 (193)
------------------------------------ ------------ -----------
Net transfers from investment
property (see note 16) - 273
------------------------------------ ------------ -----------
Net transfers from property,
plant and equipment (see note
15) - 2,415
------------------------------------ ------------ -----------
Disposals through disposal of
subsidiary companies - (6,205)
------------------------------------ ------------ -----------
Impairment loss - (724)
------------------------------------ ------------ -----------
Exchange difference - 10
------------------------------------ ------------ -----------
At end of period/year 30,214 29,763
------------------------------------ ------------ -----------
19. TRADE AND OTHER RECEIVABLES
31 December
30 June 2017 2016
EUR'000 EUR'000
------------------------------------ ------------ -----------
Trade receivables 935 863
------------------------------------ ------------ -----------
VAT receivables 428 370
------------------------------------ ------------ -----------
Other receivables 4,241 1,998
------------------------------------ ------------ -----------
Total trade and other receivables 5,604 3,231
------------------------------------ ------------ -----------
Prepayments and other assets 2,183 770
------------------------------------ ------------ -----------
Total 7,787 4,001
------------------------------------ ------------ -----------
20. Cash and cash equivalents
31 December
30 June 2017 2016
EUR'000 EUR'000
---------------- ------------ -----------
Bank balances 14,628 4,669
---------------- ------------ -----------
Cash in hand 25 29
---------------- ------------ -----------
Total 14,653 4,698
---------------- ------------ -----------
During the period, the Group had no fixed deposits.
As at 30 June 2017, the amount of EUR3.2 million (2016: EUR3.2 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 2017 31 December 2016
------------------ -----------------------
'000 of
shares EUR'000 '000 of 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 capital Share premium
'000 EUR'000 EUR'000
------------------------ ---------- -------------- --------------
Capital at 1 January
2016 and 30 June 2017 904,627 9,046 569,847
------------------------ ---------- -------------- --------------
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 warrants were exercisable within five years from the admission date. The number of shares to be issued on exercise of their rights would have been determined based on the subscription price on the exercise date. All warrants expired on 3 January 2017.
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 two
Within to five More than
Total one year years five years
-------------------- -------------------- -------------------- --------------------
30 June 31 December 30 June 31 December 30 June 31 December 30 June 31 December
2017 2016 2017 2016 2017 2016 2017 2016
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
----------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Loans in Euro 89,240 92,270 11,126 12,749 67,114 67,146 11,000 12,375
----------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
89,240 92,270 11,126 12,749 67,114 67,146 11,000 12,375
----------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Loans in Euro
within disposal
groups held
for sale 8,163 8,259 8,163 765 - 7,494 - -
----------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Total 97,403 100,529 19,289 13,514 67,114 74,640 11,000 12,375
----------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
As of 30 June 2017, there were no significant changes in terms and conditions of the outstanding loans, compared to 31 December 2016.
1 January New Capital Interest Other 30 June
2017 issues repayments paid movements 2017
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
------------------ ---------- -------- ------------ --------- ----------- --------
Loans in Euro 92,270 - (1,375) (5,084) 3,429 89,240
------------------ ---------- -------- ------------ --------- ----------- --------
Loans in Euro
within disposal
groups held
for sale 8,259 89 (169) (174) 158 8,163
------------------ ---------- -------- ------------ --------- ----------- --------
Total 100,529 89 (1,544) (5,258) 3,587 97,403
------------------ ---------- -------- ------------ --------- ----------- --------
Securities
As of 30 June 2017, there were no significant changes in the Group's loan securities compared to 31 December 2016. The securities include mortgages against immovable property, pledge of shares, fixed and floating charges over assets and corporate guarantees.
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 could 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 was EUR0.5623, equivalent of GBP0.49 (initial conversion price GBP0.50) and US$0.6583, equivalent of GPB0.4410 (initial conversion price GBP0.45) per share for the Euro Bonds and the US$ Bonds, respectively. The Euro Bonds and the US$ Bonds were not publicly traded.
Part of the Bonds, amounting to EUR41,004 thousand, was subscribed for by Third Point LLC, a significant shareholder of the Company at that time. On 8 December 2016, both Euro Bonds and US Bonds were cancelled and all accrued interest was waived as a result of the Share Purchase Agreement entered into for the sale of Playa Grande.
On 29 March 2011, 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. The Bonds were trading on the Open Market of the Frankfurt Stock Exchange (the freiverkehr market) under the symbol 12DD. 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 the scheduled maturing date in March 2016.
23. Finance lease LIABILITIES
30 June 2017 31 December 2016
-------------------------------- ---------------------------------
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 86 2 84 49 1 48
------------------- --------- -------- ----------- --------- -------- ------------
Between two and
five years 197 10 187 195 8 187
------------------- --------- -------- ----------- --------- -------- ------------
More than five
years 4,167 1,442 2,725 4,162 1,415 2,747
------------------- --------- -------- ----------- --------- -------- ------------
Total 4,450 1,454 2,996 4,406 1,424 2,982
------------------- --------- -------- ----------- --------- -------- ------------
The major finance lease liabilities comprise leases in Greece with 99-year lease terms.
24. Deferred tax assets and liabilities
30 June 2017 31 December 2016
--------------------------- ---------------------------
Deferred Deferred Deferred Deferred
tax assets tax liabilities tax assets tax liabilities
EUR'000 EUR'000 EUR'000 EUR'000
---------------------------------- ---------- --------------- ---------- ---------------
Balance at the beginning
of the period/year 996 (24,255) 997 (30,129)
---------------------------------- ---------- --------------- ---------- ---------------
Recognised in profit or
loss - continuing operations (1) (1,124) (1,549) 5,107
---------------------------------- ---------- --------------- ---------- ---------------
Recognised in profit or
loss - discontinued operation - - - 1,273
---------------------------------- ---------- --------------- ---------- ---------------
Recognised in other comprehensive
income - - - (1,682)
================================== ========== =============== ========== ===============
Reclassification to liabilities
held for sale - - 1,548 1,239
================================== ========== =============== ========== ===============
Exchange difference and
other - - - (63)
---------------------------------- ---------- --------------- ---------- ---------------
Balance at the end of the
period/year 995 (25,379) 996 (24,255)
---------------------------------- ---------- --------------- ---------- ---------------
Deferred tax assets and liabilities are attributable to the following:
30 June 2017 31 December 2016
Deferred Deferred Deferred Deferred
tax assets tax liabilities tax assets tax liabilities
EUR'000 EUR'000 EUR'000 EUR'000
---------------------------- ---------- --------------- ---------- ---------------
Revaluation of investment
property - (15,268) - (15,268)
---------------------------- ---------- --------------- ---------- ---------------
Revaluation of trading
properties - (2,022) - (1,905)
---------------------------- ---------- --------------- ---------- ---------------
Revaluation of property,
plant and equipment - (6,472) - (6,449)
============================ ========== =============== ========== ===============
Other temporary differences - (1,617) - (633)
---------------------------- ---------- --------------- ---------- ---------------
Tax losses 995 - 996 -
---------------------------- ---------- --------------- ---------- ---------------
Total 995 (25,379) 996 (24,255)
---------------------------- ---------- --------------- ---------- ---------------
25. DEFERRED REVENUE
31 December
30 June 2017 2016
EUR'000 EUR'000
------------------------- ------------- ------------
Prepayment from clients 17,687 10,683
------------------------- ------------- ------------
Government grant 7,108 7,230
------------------------- ------------- ------------
Total 24,795 17,913
------------------------- ------------- ------------
31 December
30 June 2017 2016
EUR'000 EUR'000
------------- ------------- ------------
Non-current 7,108 7,230
------------- ------------- ------------
Current 17,687 10,683
------------- ------------- ------------
Total 24,795 17,913
------------- ------------- ------------
26. Trade and other payables
30 June 2017 31 December 2016
EUR'000 EUR'000
--------------------------- ------------ ----------------
Trade payables 760 660
--------------------------- ------------ ----------------
Land creditors 21,205 25,354
=========================== ============ ================
Investment Manager fees
payable 3,188 4,221
=========================== ============ ================
Professional fees accrual - 1,952
=========================== ============ ================
Deposit relating to Pearl
disposal - 1,000
--------------------------- ------------ ----------------
Branding fees accrual 2,684 2,444
--------------------------- ------------ ----------------
Other payables and accrued
expenses 13,462 13,960
--------------------------- ------------ ----------------
Total 41,299 49,591
--------------------------- ------------ ----------------
31 December
30 June 2017 2016
EUR'000 EUR'000
------------- ------------- ------------
Non-current 27,764 6,479
------------- ------------- ------------
Current 13,535 43,112
------------- ------------- ------------
Total 41,299 49,591
------------- ------------- ------------
During the period, the Company entered into new contracts in connection with the deferred purchase of land at Lavender Bay. The amount outstanding as at 30 June 2017 was EUR21,205 thousand and payment will be made on 31 December 2025. As a result of a retroactive change in the interest rate charged on the outstanding consideration, an accrued interest payable amount of approximately EUR4 million has been reversed during the six-month period ended 30 June 2017 and included in finance income in profit or loss.
27. NAV per share
31 December
30 June 2017 2016
'000 '000
--------------------------------------------------- ------------ -----------
Total equity attributable to owners of the Company
(EUR) 218,631 233,887
--------------------------------------------------- ------------ -----------
Number of common shares outstanding at end of
period/year 904,627 904,627
--------------------------------------------------- ------------ -----------
NAV per share (EUR) 0.24 0.26
--------------------------------------------------- ------------ -----------
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 2017, 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 282
--------------------------------------- -------
Andrew Coppel 150
--------------------------------------- -------
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.
From 1 January From 1 January
2017 2016
to 30 June to 30 June
2017 2016
EUR'000 EUR'000
---------------------------- --------------- ---------------
Remuneration 388 1,022
---------------------------- --------------- ---------------
Equity-settled share-based
payment arrangements 34 49
---------------------------- --------------- ---------------
Total remuneration 422 1,071
---------------------------- --------------- ---------------
The Directors' remuneration details for the six-month periods ended 30 June 2017 and 30 June 2016 were as follows:
From 1 January From 1 January
2017 2016
to 30 June to 30 June
2017 2016
EUR'000 EUR'000
----------------- --------------- ---------------
Andrew Coppel 115 112
----------------- --------------- ---------------
Graham Warner 86 93
----------------- --------------- ---------------
Robert Heller 101 103
----------------- --------------- ---------------
Mark Townsend 28 31
----------------- --------------- ---------------
Sue Farr 58 -
----------------- --------------- ---------------
Laurence Geller - *678
----------------- --------------- ---------------
David B. Heller - 3
----------------- --------------- ---------------
Justin Rimel - 2
----------------- --------------- ---------------
Total 388 1,022
----------------- --------------- ---------------
*Comprises EUR636 thousand compensation for loss of office and EUR42 thousand compensation for expenses.
Mr. Miltos Kambourides has waived his fees.
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 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
2017 2016
to 30 June to 30 June
2017 2016
EUR'000 EUR'000
-------------------------------------- --------------- ---------------
Fixed management fee/Annual
fee 3,000 4,250
-------------------------------------- --------------- ---------------
Variable management fees/Performance
fee 1,606 -
-------------------------------------- --------------- ---------------
Equity-settled share-based
payment arrangements - Investment
Management Awards - 261
-------------------------------------- --------------- ---------------
Total remuneration 4,606 4,511
-------------------------------------- --------------- ---------------
In 2016, the Investment Manager, fully waived any rights under the Investment Manager Awards it was entitled to under the terms of the previous Investment Management Agreement ('IMA') and the Company's share incentive plan.
In line with the Amended and Restated IMA, signed in December 2016, with retroactive effect from 1 July 2016, the following arrangements came into effect:
i. Fixed management fee
The annual management fees for the second half of 2016 were retrospectively reduced from EUR8.5 million to EUR6.5 million per annum and have been set to a fixed declining annual amount equal to EUR6 million for 2017, EUR5 million for 2018 and EUR4 million for 2019.
Additionally, the term of the IMA has been reduced and will expire at the earlier of the end of the Divestment Period or 31 December 2019 rather than August 2020 as under the terms of the previous IMA. There will be no fixed management fee due for 2020.
ii. Variable management fee
Variable management fee has been introduced which will become payable solely upon the execution of each asset divestment by the Company. The variable management fee will be equal to a percentage of the enterprise value (i.e. the equity value of the asset plus any loans or other liabilities assumed by its purchaser) of any asset disposed by the Company during the Divestment Period at a valuation at or in excess of 50% of its latest reported NAV.
The variable management fee percentage will be equal to 3% for divestments executed within the second half 2016 and will be reduced to 2.5%, 2.0% and 1.3% for those concluded in 2017, 2018 and 2019 respectively for disposals completed at 50%. The variable management fee will increase in respect of transactions executed at sales prices exceeding 50% of their NAV.
The variable management fee will become payable to the Investment Manager three months from the completion of the respective disposal. Specifically in relation to the Playa Grande disposal, EUR1 million of the variable management fee has been paid upon the completion of the disposal and the balance will become payable at the earlier of the date when the Company makes a distribution of proceeds from asset sales to shareholders or nine months from the completion of the Playa Grande disposal.
With regard to the disposal of Aristo Developers Ltd and Pearl Island, the Manager will be entitled to a Variable management fee equal to 3%, 2.5%, 2% and 1.3% on the portion of their corresponding Total Disposal Prices received by the Company within 2016, 2017, 2018 and 2019, respectively.
The Investment Manager was entitled to a performance fee payable under the terms of the previous IMA. There is no change to this entitlement. However, any performance fees earned under this arrangement will be fully deducted from any future annual management fees and variable management fees payable over the term of the IMA.
Previous arrangements, in force until 30 June 2016
Annual fee
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 2016, 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 fee
i. 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 characterized 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.
ii. 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 assets. 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 2016, 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.
A clawback provision is in place with regard to incentive (performance) fee payments in the event the aggregate proceeds from the disposal of assets do not exceed certain threshold.
28.3 Shareholder and development agreements
Shareholder agreements
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.
Development agreements
Pedro Gonzalez Holdings II Limited, a subsidiary of the Group in which the Company held a 60% stake, signed a Development Management agreement with DCI Holdings Twelve Limited ('DCI H12') in which the Group had a stake of 60%. Under its terms, DCI H12 undertook, among others, the management of permitting, construction, sale and marketing of the Pearl Island project. As stated in note 29, the Company entered into a share purchase agreement for the sale of its shareholding in the project on 17 January 2017 and completion took place on 13 March 2017.
28.4 Other related parties
During the period ended 30 June 2017, the Group did not entered into any related party transactions.
During the period ended 30 June 2016, the Group entered into related party transactions with the following parties:
30 June 2016 ----------------- -------------------- ---------------------------------------- Related party name EUR'000 Nature of transaction ----------------- -------------------- ---------------------------------------- Iktinos Hellas Project management services in relation S.A. 24 to Sitia project and rent payment ----------------- -------------------- ---------------------------------------- Third Point LLC, shareholder of the Company 1,200 Bond interest for the period ----------------- -------------------- ----------------------------------------
29. Business combinations
On 17 January 2017, the Company signed a share purchase agreement with Grivalia Hospitality S.A. for the sale of its 60% shareholding in all entities related with the Pearl Island Project. Completion of the disposal was subject to a corporate restructuring and to the consent of the appointed hotel operator to modifications of certain terms of the hotel management agreement. The consideration for the sale comprised of a cash payment of EUR27 million, payable in the form of a EUR1 million non-returnable deposit, EUR24 million upon completion of the sale and the remaining EUR2 million to be retained in an escrow account for a period of 12 months post completion to cover any tax liabilities, potential breach of the Company's warranties or undisclosed indebtedness. Completion took place on 13 March 2017 with EUR24 million received by the Company on the same date.
EUR'000
---------
Investment property (28,108)
-------------------------------------------- ---------
Property, plant and equipment (25,990)
-------------------------------------------- ---------
Receivables and other assets (2,237)
-------------------------------------------- ---------
Cash and cash equivalents (183)
-------------------------------------------- ---------
Deferred tax liabilities 1,238
-------------------------------------------- ---------
Trade and other payables 11,652
-------------------------------------------- ---------
Net assets (43,628)
-------------------------------------------- ---------
Net assets disposed of - 60% shareholding (26,177)
-------------------------------------------- ---------
Net proceeds on disposal 26,476
-------------------------------------------- ---------
Gain on disposal recognised in
profit or loss 299
-------------------------------------------- ---------
Cash effect on disposal:
------------------------------------------- ---------
Net proceeds on disposal 26,476
-------------------------------------------- ---------
Cash and cash equivalents (183)
-------------------------------------------- ---------
Net cash inflow on disposal 26,293
-------------------------------------------- ---------
During the six-month period ended 30 June 2016, the group disposed of its entire holding in DolphinCI Eleven Limited ('DCI 11'), as follows:
EUR'000
--------------------------------------- --------
Trading properties (1,599)
--------------------------------------- --------
Trade and other payables 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 2016.
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 2017, the Group had a total of EUR11,679 thousand contractual capital commitments on property, plant and equipment (31 December 2016: EUR1,330 thousand).
Non-cancellable operating lease rentals are payable as follows:
31 December
30 June 2017 2016
EUR'000 EUR'000
-------------------------- ------------ -----------
Less than one year 19 11
-------------------------- ------------ -----------
Between one and two years 21 -
-------------------------- ------------ -----------
Total 40 11
-------------------------- ------------ -----------
32. Contingent liabilities
Companies of the Group are involved in pending litigation. Such litigation principally relate to day-to-day operations as a developer of second-home residences and largely derive from certain clients and suppliers. Based on advice from the Group's legal advisers, the Investment Manager believes that there is sufficient defence against any claim and does 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 interim financial statements.
A Company of the Group received a lawsuit to settle an amount of EUR3.97 million to a lending institution which related to claims assigned by one of the relevant Group company's partners. The Company's position is that there are no existing obligations towards this lending institution by the relevant Group company thus no provision has been recorded in these consolidated interim financial statements.
If investment properties, trading properties and property, plant and equipment were sold at their fair market value, this would have given rise to a variable management fee to the Investment Manager, which would be based on the relevant IMA provisions.
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
There were no material events after the reporting period which have a bearing on the understanding of the condensed consolidated interim financial statements as at 30 June 2017.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR VVLFLDKFZBBZ
(END) Dow Jones Newswires
September 29, 2017 02:01 ET (06:01 GMT)
1 Year Dci Advisors Chart |
1 Month Dci Advisors Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
