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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Dci Advisors Ltd | LSE:DCI | London | Ordinary Share | VGG2803G1028 | COM SHS EUR0.01 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.15 | 3.16% | 4.90 | 4.50 | 5.00 | 5.00 | 4.75 | 4.75 | 15,133,153 | 16:35:02 |
| 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 : 2522C
Dolphin Capital Investors Limited
28 September 2018
28 September 2018
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 2018 and
Trading Update
Financial Highlights:
Hot Features
Premium
-- Gross Assets of EUR391 million (31 December 2017:
EUR395 million).
-- Total Group Net Asset Value ("NAV") of EUR220 million
and EUR190 million before and after Deferred Tax Liabilities
("DTL") respectively. This represents a decrease of
EUR3 million and EUR4 million (1.48% and 2.09%) respectively,
against the 2017 year end figures.
-- NAV reduction principally due to normal operational
and financial expenses, offset by the increase in
the carrying value of Amanzoe to reflect disposal
consideration. No portfolio valuation was undertaken
as at 30 June 2018; the next full portfolio valuation
will be conducted as at 31 December 2018.
-- Sterling NAV per share as at 30 June 2018 stood at
22p before DTL and 19p after DTL, remaining stable
compared to the respective figures as at 31 December
2017.
-- Total debt of EUR99 million with a Group total debt
to gross asset ratio of25% as at 30 June 2018. The
pro-forma Group total debt following the Amanzoe disposal
which completed on 27 September amounts to EUR24 million,
resulting in a pro forma gearing ratio for the Group
of 9%. 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.
-- Cash at 30 June 2018 of EUR12.7m (31 December 2017:
EUR2.4m).
Portfolio:
-- On 18 January 2018, Dolphin entered into an agreement
for the disposal of its 77.8% interest in the Sitia
Bay Resort project for a total cash consideration
of EUR14 million. The full consideration was received
by the Company and the disposal was completed on 3
April 2018.
-- On 5 February 2018, Dolphin sold its 100% interest
in Triopetra for a total consideration of EUR4.1 million.
-- On 1 August 2018, subsequent to the period end, the
Company entered into an agreement for the disposal
of its 100% interest in Amanzoe and the conditional
sale of 20 Kilada Hills Golf plots to Grivalia Hospitality
S.A. The disposal of Amanzoe completed on 27 September,
and the full EUR5.8 million cash consideration for
Amanzoe was paid to Dolphin, whilst the acquirers
also assumed all existing liabilities of Amanzoe which
amounted to EUR117 million as at 30 June 2018. The
EUR10 million cash consideration for the purchase
of the 20 Kilada Hills plots will be paid in instalments,
at the time when the senior construction loan for
the development of the first phase of the project
is secured and in line with its draw-down. The Company
is in advanced discussions with a local bank in relation
to this financing.
Operations:
-- Amanzoe's performance improved by increasing occupancy
to c.63% for the period up to June 2018 versus 59%
for the same period in 2017, generating an Average
Daily Rate ("ADR") of EUR1,209 and a Revenue per Available
Room ("RevPAR") of EUR760 over the same period (2017:
EUR1,173 and EUR687 respectively). Amanzoe continued
its strong performance during July and August.
-- The new construction permits for the One&Only Kéa
Island project were issued on 7 July 2018 and the
construction is expected to start during Q4 of this
year. In parallel, the finalization of a EUR30 million
senior construction loan (as well as a VAT and subsidy
bridge facilities) is underway with a local bank and
is expected to complete the financing requirements
for the construction of the project.
-- The planning permitting process of Kilada Hills Golf
Resort was completed during August 2018. Kilada is
the first private project in Greece to ever receive
an approval under the Strategic Project Legislation
which, subject to securing the respective senior development
loan, paves the way for the commencement of infrastructure
and golf course works and allows for the submission
for approval of construction permits for the residential
units.
-- Aristo sold 58 homes during the six months to June
2018, representing total sales of EUR27.6 million
and an increase of 3.8% compared to the same period
in 2017. Aristo has maintained a quality land bank,
commensurate with its leading industry position in
Cyprus, and expects its overall 2018 performance to
be ahead of 2017.
-- Sales agreements were signed for two Seafront Villas
in Kilada Hills for an aggregate consideration of
EUR2.6 million and for one residence at La Vanta,
Turkey.
Commenting, Andrew Coppel, Chairman of Dolphin's Board of Directors said:
"We remain focussed on achieving our objective of disposing of all of the Company's assets and made significant progress during this period. We have also taken steps to increase the value of the project portfolio without recourse to additional equity investment. We believe that the commencement of both the One&Only development at Kea, and the first phase of the Kilada Hills development, the Company's most valuable asset in terms of net asset value as at 30 June 2018, will unlock significant value for our shareholders."
Miltos Kambourides, Founder of Dolphin and Managing Partner of Dolphin Capital Partners said:
"The Company has made good progress in disposing of a number of portfolio assets during 2018 and completing the permitting process of Kea One&Only and Kilada Hills. The upcoming commencement of construction works of these two projects, combined with economic recovery and tourism growth in Greece and Cyprus, is expected to create a better basis for further asset sales."
For further information, please contact:
Dolphin Capital Investors Andrew M Coppel, CBE +44 (0) 7785 577023 Dolphin Capital Partners Miltos E Kambourides miltos@dolphincp.com Panmure Gordon (Broker) Richard Gray/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 2007
A. Chairman's Statement
I am pleased to report Dolphin's interim financial results for the six months ended 30 June 2018 and to provide a trading update.
Loss after tax for the period ended 30 June 2018 attributable to owners of the Company amounted to EUR14 million compared to EUR3 million for the period ended 30 June 2017. Taking into account the Amanzoe revaluation to the agreed disposal price, the effect on the Company's NAV was a reduction of EUR3 million before DTL.
During the first half year and in the subsequent three months, the Board and the Investment Manager have continued their efforts to achieve the orderly and controlled disposal of the Group's assets. In the period to 30 June 2018, the Company completed the disposal of its interests in Sitia Bay and Triopetra. Subsequent to 30 June, the Company has achieved the sale of Amanzoe. During the six months to end of June 2018 the Company has received an aggregate EUR18.5 million of gross cash consideration, which increased its cash reserves as at 30 June to EUR12.7 million, while in parallel reducing the Group debt by EUR74 million. Further details on the revenue and the operating expenses of the Company during the period are provided in section F below.
Our attention now is focussed on satisfying the conditions precedent for the completion of the Joint Venture agreement to enable the commencement of the development of the One&Only at Kea, on securing the development loan that will enable the Company to develop the first phase of Kilada Hills and on monetizing our remaining asset portfolio.
The completion of Greece's third financial assistance programme in August 2018, which marks the termination of the country's 8-year reliance on EU financial stability funds and its return to a stronger economic footing, together with the record tourist arrivals recorded during 2018 in both Greece and Cyprus, are expected to further enhance the appeal of local hospitality assets to international investors and facilitate the Company's divestment efforts.
The Company is also taking steps to realize its significant shareholding position in Aristo and is encouraged by its sustained operating performance during the period. Revenue for the 2018 financial year is expected to be ahead of the previous year.
Sue Farr and Rob Heller stepped down from the Board in January 2018. Their contribution was much appreciated and we wish them much success in their other ventures.
The Board and the Investment Manager will continue their efforts to facilitate shareholders' returns through the monetisation of assets.
Andrew M Coppel CBE
Chairman
Dolphin Capital Investors
28 September 2018
Investment Manager's Report
B.1. Business Overview
During the first nine months of 2018 we completed further asset disposals as well as progressed the development of key portfolio assets.
Our actions can be summarised as follows:
-- Executed a number of significant divestments, including the disposals
of Amanzoe, Sitia Bay and Triopetra with an aggregate enterprise
value of EUR147 million.
-- Progressed the entitlement status and development potential of
Kilada Hills Golf Resort, including the forward conditional sale
of the 20 land plots for a cash consideration of EUR10 million.
-- Continued to make progress t complete the conditions precedent
for Dolphin's joint venture at the One&Only Kéa Island development
and start its construction with no incremental investment by Dolphin.
Construction is expected to commence in Q4 2018.
-- We are progressing discussions to monetise the Group's portfolio
assets or to enter into joint ventures which can facilitate their
sale.
B.2. Portfolio Review
-- Amanzoe, Greece
-- On 1 August 2018, the Company entered into an
agreement for the disposal of its 100% interest
in Amanzoe and the sale of 20 Kilada Hills Golf
plots to Grivalia Hospitality S.A., which is
managed by Grivalia Properties, a real estate
investment company listed on the Athens stock
exchange.
-- The disposal completed on 27 September and the
cash consideration of EUR5.8 million for Amanzoe
was paid to Dolphin while the acquirers also
assumed all existing liabilities of Amanzoe,
which amounted to EUR117 million as at 30 June
2018. The disposal consideration represents a
premium of 8% to DCI's gross asset carrying value
as at 31 December 2017 and will result in a surplus
over carrying value on sale of EUR9 million.
-- The asset management of Amanzoe will be continued
by Dolphin Capital Partners Ltd, the Company's
Investment Manager, which also acquired a 15%
equity stake in Amanzoe from Grivalia on pari
passu terms after the completion of the disposal.
-- Amanzoe initiated operations for the 2018 season
on 29 March 2018, as scheduled. Hotel performance
for the period to end August 2018 was well ahead
of the same period in 2017, with occupancy reaching
77% versus 72% in 2017, an ADR of EUR1,497 and
a RevPAR EUR1,148 versus EUR1,452 and EUR1,050
for the same period in 2017.
-- Amanzoe continued to receive extensive coverage
in the international press during the first 9
months of 2018. Detailed articles appeared in
such exclusive titles as Porter, Billionaire,
Vogue (UK), The Sunday Times Travel, Tatler and
The Times, whereas FT How To Spend It and The
Telegraph Luxury featured extensive coverage
on purchasing Villas at Amanzoe. In addition,
strong promotion was seen across social media
through collaborations pursued with numerous
influencers and brand collaborations.
-- Kilada Hills Golf Resort Greece
-- The planning permitting process of the project
was completed on 22 August 2018 when the Joint
Ministerial Decision granting approval for
the Environmental Conditions and Urban Study
for the project was published in the Greek
Government Gazette. Kilada Hills Golf Resort
thus became the first private real estate
development project to receive permits under
the ambit of the Strategic Project Legislation.
The next permitting phase of the project involves
the completion and submission of the infrastructure
drawings for approval which is expected in
Q4 2018, further to which ground breaking
infrastructure works may commence.
-- The first phase of the project will include
a championship 18-hole Jack Nicklaus Signature
Golf Course (the plans for which are already
in place), a Club House, a Beach Club and
the infrastructure for the first cluster of
residential Golf plots which are being made
available for sale.
-- As part of the Amanzoe disposal, Grivalia
have agreed to purchase 20 Golf plots in Kilada
Hills for a EUR10 million cash consideration,
conditional on the Company securing a senior
development loan for the project, the issuance
of final building permits and the tendering
of a construction contract for the project's
first phase development. The Company is in
advanced discussions with a major local bank
in relation to the financing of the first
phase of Kilada Hills project.
-- Sitia Bay, Greece
-- On 18 January 2018, Dolphin entered into an agreement
for the disposal of its 77.8% interest in the
Sitia Bay Resort project to its minority partner
in the project, Iktinos Hellas S.A., for a total
consideration of EUR14 million which was equal
to Sitia Bay's NAV after DITL as at 30 June 2017.
The full consideration was received by the Company
and the disposal was completed on 3 April 2018.
-- Triopetra, Greece
-- On 5 February 2018 Dolphin entered into an agreement
for the disposal of its 100% interest in the
Triopetra project to Deniage Ltd, a Cyprus entity
affiliated with a large Saudi Arabian investment
group for a total cash consideration of EUR4.1m,
of which an amount of EUR4m was received at closing
and the remaining EUR100,000 will be withheld
until the first anniversary of the transaction
to cover any potential latent project liabilities.
The disposal consideration of EUR4.1m represents
a significant premium compared to Triopetra's
NAV after DITL included in DCI's financial statements
as at 30 June 2017.
-- Kea Resort, Greece
-- The Company has continued to make progress t
satisfy the conditions precedent for the One&Only
Kéa Island development, in order to start
the construction of the project during Q4 of
this year.
-- The project designs have been revised to reflect
the requirements of One&Only and comprise 75
guest rooms. The revised designs were submitted
to the local authorities for approval and the
new construction permits were issued on 7 July
2018. Detailed construction drawings have been
completed and a formal tender for the construction
of the project was initiated on 28 September
2018.
-- The definitive documentation for a EUR30 million
senior construction loan (as well as a VAT and
subsidy bridge facility) is underway with a local
bank which, on finalization, will complete the
financing required for the construction of the
One&Only Kéa Island in accordance with the
existing development budget.
-- In parallel, the designs for the One&Only Villas
have been prepared and the formal launch of Villa
sales will occur following the implementation
of our JV agreement with One&Only expected later
this year.
-- Aristo (a 47.9% affiliate)
Operating Performance
- Strong sales momentum continued in 2018, with
58 homes and plots sold during the first six
months of 2018 and 75 homes and plots sold during
the period through August 2018, representing
total sales of EUR27.7 million during the first
six months and EUR33.7 million for the period
through August 2018 (a slight decrease of 9.8%
on a year-on year basis).
Six months Six months Eight months Eight months
to 30 June to 30 June to 31 August to 31 August
2018 2017 2018 2017
RETAIL SALES
------------------ -------------- -------------- -------------- --------------
New sales booked EUR27,669,748 EUR26,667,816 EUR33,735,248 EUR37,409,116
% change 3.8% -9.8%
Units sold 58 50 75 74
% change 16.0% 1.4%
CLIENT ORIGIN
------------------ -------------- -------------- -------------- --------------
China & Other
Asia 58.7% 80.8% 71.3% 80.6%
MENA 21.2% 6.8% 11.5% 7.9%
Russia 7.3% 8.5% 8.9% 7.0%
UK 2.8% - 2.0% -
Cyprus & Other
EU 10.0% 3.9% 6.3% 4.5%
- The Company is encouraged by the sustained improvement
in Aristo operations and the continued strong
sales during 2018, which comes on top of the
significant reduction in Aristo's bank debt burden
achieved during 2017. On the back of this operational
momentum, we are actively considering divestment
alternatives for the realization of our holding
in Aristo, as well as extracting some value in
the form of shareholder distributions from Aristo's
operating profits.
-- Nikki Beach, Porto Heli (a 25% DCI affiliate)
-- The operations improved during 2018 compared
to 2017. The occupancy for the first eight months
of the 2018 operational period was 74% compared
to 61% for the same period in 2017, with a net
ADR of EUR217 and a RevPAR of EUR161 versus EUR241
and EUR148 respectively in 2017
-- 2018 is the second year that the Nikki Beach
Resort and Spa at Porto Heli is being managed
by a local white label operator (a commercial
cooperation agreement was signed in February
2017). As a result, the Company has no financial
exposure to the day-to-day operational performance
of the hotel and receives monthly revenue-linked
payments without incurring any hotel operating
costs.
-- Apollo Heights
-- The zoning and entitlement processes have not
progressed due to delays attributed to the
Local Government Authorities and the Sovereign
(UK) Bases Administration. Together with the
local communities representatives, we continue
to lobby in order to have the relevant zones
published before the end of 2018.
C. Market Dynamics
-- Greece
-- Greece has successfully exited its final three-year
bailout program agreed in August 2015 to help
it cope with the continued fallout from the debt
crisis. In parallel, the country realized a 1.8%
year-on-year GDP increase in the second quarter
of 2018 and the Hellenic Statistical Authority
also revised higher growth rates of 2.5% (from
2.3%) year-on-year for the first quarter of 2018.
Greece's tourism sector is largely responsible
for the GDP increase and inbound tourism to Greece
in 2018 continued its upward trend of the previous
years.
-- Cyprus
-- Fitch has upgraded its rating on Cyprus' to 'BB+'
from 'BB' because of the country's strong cyclical
economic recovery and prudent fiscal policy.
This rating is now just one step below investment
grade and the outlook is positive, although the
weakness in the banking sector is still a risk
to public finances.
In addition, the GDP growth rate in real terms
during the second quarter of 2018 is positive
and estimated at +3.9% over the corresponding
quarter of 2017.
For the period of January to June 2018, more
than 1.6 million tourists visited the country,
compared to 1.46 million for the same period
last year, recording an increase of 12.4%. According
to the country's Statistical Service, this number
exceeds the total arrivals ever recorded in Cyprus
during the first six months of the year.
-- Croatia
-- In the first half of 2018, 6.4 million tourists
visited Croatia, generating 25.4 million overnight
stays, up 10% and 12% respectively on the year,
according to the Croatian National Tourist Board.
Of the coastal regions, Istria registered the
most overnight stays (7.4 million), followed
by Split- Dalmatia (4.5 million) and Primorje-Gorski
Kotae (4.3 million).
-- Turkey
-- According to the Turkish Statistics Institute,
Turkey's economy slowed in the second quarter
of 2018. The slowdown comes amid a Turkish currency
crisis that saw the lira lose around 40% of its
value since the beginning of the year.
In the second quarter of 2018, tourism income
increased by 30.1% and for the first six months
of the year foreign visitor numbers are up by
29%. However, the economic situation in Turkey
remains challenging.
D. Group Assets
A summary of Dolphin's current investments is presented below. As at 30 June 2018, the net investment amount stood at EUR 473 million.
PROJECT Land DCI's Investment Debt Real Loan
site stake cost* (EURm) estate to real
(hectares) (EURm) ** value estate
(EURm) asset
value
(%)
------------------------ ------------ ------- ----------- -------- -------- ---------
Kilada Hills Golf
1 Resort 235 100% 95 -
2 Kea Resort 65 67% 10 -
3 Scorpio Bay Resort 172 100% 15 -
The Nikki Beach
4 Resort 1 25% 7 -
5 Lavender Bay Resort 310 100% 27 -
6 Plaka Bay Resort 442 100% 13 -
Apollo Heights
6 Resort 461 100% 24 16.7
7 Livka Bay Resort 63 100% 30 7.7
8 La Vanta 8 100% 18 -
Sold post 30 June
2018
1 Amanzoe 93 100% 41 74
------------------------ ------------ ------- ----------- -------- -------- ---------
TOTAL 1,850 278 98.4 328 30%
------------------------ ------------ ------- ----------- -------- -------- ---------
Aristo Cyprus 1,448 47.9% 193 - 43
Itacaré Investment n/a 13% 2 - 1
------------------------ ------------ ------- ----------- -------- -------- ---------
GRAND TOTAL 3,298 473 98 372 26%
------------------------ ------------ ------- ----------- -------- -------- ---------
*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 2018, for certain key metrics is provided below:
COUNTRY Land size Investment Debt Real Estate % Loan Net Asset
(hectares) Cost * (EUR Value to real Value
(EUR million) (EUR estate
million) million) asset
value
------------ ------------ ----------- ---------- ------------ --------- ----------
1 Greece 1,318 207 74 264 28% 61%
2 Cyprus** 1,909 217 17 70 24% 26%
3 Other 71 49 8 38 21% 13%
Grand Total 3,298 473 98 372 26% 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 2018 are to:
1. Execute further asset disposals;
2. Complete the conditions precedent for the One&Only Kéa
Island development and start construction;
3. Secure third party funding for the Kilada Hills project
so that the development can commence; 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
28 September 2018 28 September 2018
F. Financial Position for the first half of 2018
Financial Results
Loss after tax for the period ended 30 June 2018 attributable to owners of the Company amounted to EUR14 million compared to EUR3 million for the period ended 30 June 2017. Loss per share was EUR0.015 compared to EUR0.003 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 2018
From 1 January From 1 January
2018 2017
to 30 June to 30 June
2018 2017
(Restated)
EUR'000 EUR'000
------------------------------------------------ --------------- ---------------
Continuing operations
------------------------------------------------ --------------- ---------------
Revenue 1,551 721
------------------------------------------------ --------------- ---------------
Cost of sales (1,572) (665)
------------------------------------------------ --------------- ---------------
Gross (loss)/ profit (21) 56
------------------------------------------------ --------------- ---------------
Disposal of investments (1,182) 4
------------------------------------------------ --------------- ---------------
Change in valuations 1,277 -
------------------------------------------------ --------------- ---------------
Investment Manager remuneration (4,006) (4,606)
------------------------------------------------ --------------- ---------------
Directors' remuneration (318) (422)
------------------------------------------------ --------------- ---------------
Depreciation charge (15) (4)
------------------------------------------------ --------------- ---------------
Professional fees (2,317) (2,311)
------------------------------------------------ --------------- ---------------
Administrative and other expenses (817) (807)
------------------------------------------------ --------------- ---------------
Total operating and other expenses (7,378) (8,146)
------------------------------------------------ --------------- ---------------
Results from operating activities (7,399) (8,090)
------------------------------------------------ --------------- ---------------
Finance income 19 3,968
------------------------------------------------ --------------- ---------------
Finance costs (4,870) (2,985)
------------------------------------------------ --------------- ---------------
Net finance (costs)/income (4,851) 983
------------------------------------------------ --------------- ---------------
Loss before taxation (12,250) (7,107)
------------------------------------------------ --------------- ---------------
Taxation (674) (1,090)
------------------------------------------------ --------------- ---------------
Loss from continuing operations (12,924) (8,197)
------------------------------------------------ --------------- ---------------
Discontinued Operations
------------------------------------------------ --------------- ---------------
(Loss)/profit from discontinued operation,
net of tax (1,213) 10,389
------------------------------------------------ --------------- ---------------
(Loss)/profit (14,137) 2,192
------------------------------------------------ --------------- ---------------
Other comprehensive income
------------------------------------------------ --------------- ---------------
Items that will not be reclassified to
profit or loss
------------------------------------------------ --------------- ---------------
Revaluation of property, plant and equipment 11,943 -
------------------------------------------------ --------------- ---------------
Related tax (3,463) -
------------------------------------------------ --------------- ---------------
8,480 -
------------------------------------------------ --------------- ---------------
Items that are or may be reclassified
subsequently to profit or loss
------------------------------------------------ --------------- ---------------
Foreign currency translation differences 1,194 (13,193)
------------------------------------------------ --------------- ---------------
1,194 (13,193)
------------------------------------------------ --------------- ---------------
Other comprehensive income, net of tax 9,674 (13,193)
------------------------------------------------ --------------- ---------------
Total comprehensive income (4,463) (11,001)
------------------------------------------------ --------------- ---------------
(Loss)/profit attributable to:
------------------------------------------------ --------------- ---------------
Owners of the Company (13,729) (2,682)
------------------------------------------------ --------------- ---------------
Non-controlling interests (408) 4,874
------------------------------------------------ --------------- ---------------
(14,137) 2,192
=============================================== =============== ===============
Total comprehensive income attributable
to:
----------------------------------------------- --------------- ---------------
Owners of the Company (4,055) (15,290)
----------------------------------------------- --------------- ---------------
Non-controlling interests (408) 4,289
=============================================== =============== ===============
(4,463) (11,001)
=============================================== =============== ===============
Basic and diluted loss per share (EUR) (0.015) (0.003)
----------------------------------------------- --------------- ---------------
Basic and diluted loss per share - Continuing
operations (EUR) (0.014) (0.009)
----------------------------------------------- --------------- ---------------
Basic and diluted (loss)/earnings per
share - Discontinued
operation (EUR) (0.001) 0.006
----------------------------------------------- --------------- ---------------
Further analysis of individual revenue and expense items is provided below.
Revenue
Revenue from continuing operations of EUR1.6 million (H1 2017: EUR0.7 million), was derived from the following sources:
H1 2018 H1 2017
(EUR million) (EUR million)
----------------------------------------- --------------- ---------------
Sale of trading & investment properties 1.5 0.0
Other income 0.1 0.7
TOTAL 1.6 0.7
The increase in the sale of trading and investment properties relates to the fact that one 1-bedroom Villa was delivered in 2018 in the Amanzoe project, whereas in 2017 no new Villa sale was recognized in the financial statements.
Cost of sales
Cost of sales from continuing operations comprises the following basic categories:
H1 2018 H1 2017
(EUR million) (EUR million)
---------------------------------- --------------- ---------------
Cost of sales related to:
Sales of trading and investment
properties 1.1 0.0
Personnel expenses 0.4 0.3
Branding fees 0.0 0.3
Other operating expenses 0.1 0.1
TOTAL 1.6 0.7
The charge of cost of sales from continuing operations for the period amounted to EUR1.6 million (H1 2017: EUR0.7 million). The increase is mainly attributable to the cost of one Villa sold.
Professional Fees
The charge for the period from continuing operations was EUR2.3 million (H1 2017: EUR2.3 million) and comprises the following:
H1 2018 H1 2017
(EUR million) (EUR million)
-------------------------------- --------------- ---------------
Legal fees 0.4 0.5
Auditors' remuneration 0.2 0.2
Accounting expenses 0.1 0.1
Project design and development
fees 1.3 1.1
Consultancy fees 0.1 0.2
Other professional fees 0.2 0.2
-------------------------------- --------------- ---------------
TOTAL 2.3 2.3
Administrative and other expenses
The administrative and other expenses from continuing operations amounted to EUR0.8 million (H1 2017: EUR0.8 million) and are analysed as follows:
H1 2018 H1 2017
(EUR million) (EUR million)
------------------------------------ --------------- ---------------
Travelling and accommodation 0.1 0.1
Repairs and maintenance 0.1 0.1
Marketing and advertising expenses 0.1 0.1
Rents 0.1 0.1
Other 0.4 0.4
------------------------------------ --------------- ---------------
TOTAL 0.8 0.8
Net Finance costs
The charge for the period from continuing operations was EUR4.9 million (H1 2017: EUR1.0 million income) and comprises the following:
H1 2018 H1 2017
(EUR million) (EUR million)
---------------- --------------- ---------------
Finance income 0.0 4.0
Finance costs (4.9) (3.0)
TOTAL (4.9) 1.0
During 2017, 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 one reflected in the previous contracts. As the new contracts have a retroactive effect, the interest accrued in prior years of c. EUR4 million was reversed during period ended 30 June 2017, resulting in the crystallization of corresponding finance income.
Our finance costs during the first six months of 2018 also increased by a EUR1.4 million FX loss resulting from the c. 15% devaluation of the Turkish Lira against the Euro during the period.
Condensed consolidated interim statement of financial position
As at 30 June 2018
30 June 31 December
2018 2017
EUR'000 EUR'000
---------------------------------- --------- -----------
Assets
---------------------------------- --------- -----------
Property, plant and equipment 11,542 87,551
----------------------------------- --------- -----------
Investment property 130,671 138,672
----------------------------------- --------- -----------
Deferred tax assets - 994
----------------------------------- --------- -----------
Non-current assets 142,213 227,217
----------------------------------- --------- -----------
Trading properties 10,700 30,572
----------------------------------- --------- -----------
Trade and other receivables 420 5,374
----------------------------------- --------- -----------
Cash and cash equivalents 12,739 2,444
----------------------------------- --------- -----------
Assets held for sale 224,914 129,131
----------------------------------- --------- -----------
Current assets 248,773 167,521
----------------------------------- --------- -----------
Total assets 390,986 394,738
=================================== ========= ===========
Equity
---------------------------------- --------- -----------
Share capital 9,046 9,046
----------------------------------- --------- -----------
Share premium 569,847 569,847
----------------------------------- --------- -----------
Retained deficit (411,285) (397,746)
=================================== ========= ===========
Other reserves 22,404 12,912
=================================== ========= ===========
Equity attributable to owners of
the Company 190,012 194,059
----------------------------------- --------- -----------
Non-controlling interests 366 4,769
----------------------------------- --------- -----------
Total equity 190,378 198,828
----------------------------------- --------- -----------
Liabilities
---------------------------------- --------- -----------
Loans and borrowings 14,722 68,544
----------------------------------- --------- -----------
Finance lease liabilities 3,001 2,990
----------------------------------- --------- -----------
Deferred tax liabilities 10,702 19,561
----------------------------------- --------- -----------
Trade and other payables 20,746 20,858
----------------------------------- --------- -----------
Deferred revenue - 6,985
----------------------------------- --------- -----------
Non-current liabilities 49,171 118,938
----------------------------------- --------- -----------
Loans and borrowings 2,006 21,171
----------------------------------- --------- -----------
Finance lease liabilities 4 8
----------------------------------- --------- -----------
Trade and other payables 6,309 16,193
----------------------------------- --------- -----------
Deferred revenue 3,621 13,834
----------------------------------- --------- -----------
Liabilities held for sale 139,497 25,766
----------------------------------- --------- -----------
Current liabilities 151,437 76,972
----------------------------------- --------- -----------
Total liabilities 200,608 195,910
----------------------------------- --------- -----------
Total equity and liabilities 390,986 394,738
----------------------------------- --------- -----------
Net asset value ('NAV') per share
(EUR) 0.21 0.21
----------------------------------- --------- -----------
The reported NAV as at 30 June 2018 is presented below:
As at As at Variation since
30 June 2018 31 December 2017 31 December 2017
EUR GBP EUR GBP EUR GBP
-------------------------------- ------- ------- ----------------- --------- ---------
Total NAV before DTL (million) 220 195 223 198 (1.5%) (1.7%)
-------------------------------- ------- ------- ----------------- --------- ---------
Total NAV after DTL (million) 190 168 194 172 (2.1%) (2.3%)
-------------------------------- ------- ------- ----------------- --------- ---------
NAV per share before DTL 0.24 0.22 0.25 0.22 (1.5%) (0.0%)
-------------------------------- ------- ------- ----------------- --------- ---------
NAV per share after DTL 0.21 0.19 0.21 0.19 (0.0%) (0.0%)
___________
Notes:
1. Euro/GBP rate 0.88551 as at 30 June 2018 and 0.88773 as at 31 December 2017.
2. NAV per share has been calculated on the basis of 904,626,856 issued shares as at 30 June 2018 and as at 31 December 2017.
Total Group NAV as at 30 June 2018 was EUR220 million and EUR190 million before and after DTL respectively. This represents a decrease of EUR3 million (1.5%) and EUR4 million (2.1%), respectively, from the 31 December 2017 figures. Given that no valuation of the Company's portfolio took place as at 30 June 2018, the NAV reduction is mainly due to Dolphin's regular operational, corporate, finance and management expenses counterbalanced by the increase in the carrying value of Amanzoe to reflect the sales price.
Sterling NAV per share as at 30 June 2018 was 22p before DTL and 19p after DTL remaining stable compared to the respective figures as at 31 December 2017 since the factors mentioned above were not material to change the value per share. Furthermore Sterling remained almost unchanged against the Euro at the end of the period.
The Company's consolidated assets include EUR153 million of real estate assets, EUR225 million of assets held for sale, and EUR13 million in cash.
The balance of EUR153 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 EUR225 million of assets held for sale includes EUR174 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 2018), EUR1 million of available-for-sale financial assets which represents the Company's investment in Itacare, EUR3 million of other assets and EUR3 million in cash. The EUR174 million figure comprises the aggregate total appraised value of the Company's Kea Resorts, Livka Bay and La Vanta projects as well as the value of Amanzoe based on the respective sale agreement.
The Company's consolidated liabilities (excluding DTL) total EUR171 million and mainly comprise EUR102 million of interest bearing loans and finance lease obligations (of which EUR82 million are classified as liabilities held for sale). All loans are held by Group subsidiaries and are non-recourse to Dolphin. The pro-forma Group total debt following the Amanzoe disposal which completed on 27 September amounts to EUR24 million, resulting in a pro forma gearing ratio for the Group of 9%.
The EUR69 million of trade and other payables and deferred revenue (including EUR38 million of trade and other payables and deferred revenue from state subsidies) 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 EUR17 million of client advances from villa sales and hotel reservations.
Condensed consolidated interim statement of profit or loss and other comprehensive income
For the six-month period ended 30 June 2018
From 1 January From 1 January
2018 2017
to 30 June to 30 June
2018 2017
(Restated)
Note EUR'000 EUR'000
------------------------------------------ ----- --------------- ---------------
Continuing operations
------------------------------------------ ----- --------------- ---------------
Revenue 6 1,551 721
------------------------------------------ ----- --------------- ---------------
Cost of sales 7 (1,572) (665)
------------------------------------------ ----- --------------- ---------------
Gross (loss)/profit (21) 56
------------------------------------------ ----- --------------- ---------------
Disposal of investments 8A (1,182) 4
------------------------------------------ ----- --------------- ---------------
Change in valuations 8B 1,277 -
------------------------------------------ ----- --------------- ---------------
Investment Manager remuneration 28.2 (4,006) (4,606)
------------------------------------------ ----- --------------- ---------------
Directors' remuneration 28.1 (318) (422)
------------------------------------------ ----- --------------- ---------------
Depreciation charge (15) (4)
------------------------------------------ ----- --------------- ---------------
Professional fees 11 (2,317) (2,311)
------------------------------------------ ----- --------------- ---------------
Administrative and other expenses 12 (817) (807)
------------------------------------------ ----- --------------- ---------------
Total operating and other expenses (7,378) (8,146)
------------------------------------------ ----- --------------- ---------------
Results from operating activities (7,399) (8,090)
------------------------------------------ ----- --------------- ---------------
Finance income 26 19 3,968
------------------------------------------ ----- --------------- ---------------
Finance costs (4,870) (2,985)
------------------------------------------ ----- --------------- ---------------
Net finance (costs)/income (4,851) 983
------------------------------------------ ----- --------------- ---------------
Loss before taxation (12,250) (7,107)
------------------------------------------ ----- --------------- ---------------
Taxation 13 (674) (1,090)
------------------------------------------ ----- --------------- ---------------
Loss from continuing operations (12,924) (8,197)
------------------------------------------ ----- --------------- ---------------
DISContinuED operation
------------------------------------------ ----- --------------- ---------------
(Loss)/profit from discontinued
operation, net of tax 10 (1,213) 10,389
------------------------------------------ ----- --------------- ---------------
(Loss)/profit (14,137) 2,192
------------------------------------------ ----- --------------- ---------------
Other comprehensive income
------------------------------------------ ----- --------------- ---------------
Items that will not be reclassified
to profit or loss
------------------------------------------ ----- --------------- ---------------
Revaluation of property, plant
and equipment 15 11,943 -
------------------------------------------ ----- --------------- ---------------
Related tax 13 (3,463) -
------------------------------------------ ----- --------------- ---------------
8,480 -
------------------------------------------ ----- --------------- ---------------
Items that are or may be reclassified
subsequently to profit or loss
------------------------------------------ ----- --------------- ---------------
Foreign currency translation differences 1,194 (13,193)
------------------------------------------ ----- --------------- ---------------
1,194 (13,193)
------------------------------------------ ----- --------------- ---------------
Other comprehensive income, net
of tax 9,674 (13,193)
------------------------------------------ ----- --------------- ---------------
Total comprehensive income (4,463) (11,001)
------------------------------------------ ----- --------------- ---------------
(Loss)/profit attributable to:
------------------------------------------ ----- --------------- ---------------
Owners of the Company (13,729) (2,682)
------------------------------------------ ----- --------------- ---------------
Non-controlling interests (408) 4,874
------------------------------------------ ----- --------------- ---------------
(14,137) 2,192
========================================== ===== =============== ===============
Total comprehensive income attributable
to:
------------------------------------------ ----- --------------- ---------------
Owners of the Company (4,055) (15,290)
------------------------------------------ ----- --------------- ---------------
Non-controlling interests (408) 4,289
========================================== ===== =============== ===============
(4,463) (11,001)
========================================== ===== =============== ===============
(Loss)/earnings per share
------------------------------------------ ----- --------------- ---------------
Basic and diluted loss per share
(EUR) 14 (0.015) (0.003)
------------------------------------------ ----- --------------- ---------------
Basic and diluted loss per share
- Continuing operations (EUR) 14 (0.014) (0.009)
------------------------------------------ ----- --------------- ---------------
Basic and diluted (loss)/earnings
per share - Discontinued operation
(EUR) 14 (0.001) 0.006
------------------------------------------ ----- --------------- ---------------
Condensed consolidated interim statement of financial position
As at 30 June 2018
30 June 31 December
2018 2017
Note EUR'000 EUR'000
---------------------------------- ---- --------- -----------
Assets
---------------------------------- ---- --------- -----------
Property, plant and equipment 15 11,542 87,551
---------------------------------- ---- --------- -----------
Investment property 16 130,671 138,672
---------------------------------- ---- --------- -----------
Deferred tax assets 24 - 994
---------------------------------- ---- --------- -----------
Non-current assets 142,213 227,217
---------------------------------- ---- --------- -----------
Trading properties 18 10,700 30,572
---------------------------------- ---- --------- -----------
Trade and other receivables 19 420 5,374
---------------------------------- ---- --------- -----------
Cash and cash equivalents 20 12,739 2,444
---------------------------------- ---- --------- -----------
Assets held for sale 17 224,914 129,131
---------------------------------- ---- --------- -----------
Current assets 248,773 167,521
---------------------------------- ---- --------- -----------
Total assets 390,986 394,738
================================== ==== ========= ===========
Equity
---------------------------------- ---- --------- -----------
Share capital 21 9,046 9,046
---------------------------------- ---- --------- -----------
Share premium 21 569,847 569,847
---------------------------------- ---- --------- -----------
Retained deficit (411,285) (397,746)
================================== ==== ========= ===========
Other reserves 22,404 12,912
================================== ==== ========= ===========
Equity attributable to owners
of the Company 190,012 194,059
---------------------------------- ---- --------- -----------
Non-controlling interests 366 4,769
---------------------------------- ---- --------- -----------
Total equity 190,378 198,828
---------------------------------- ---- --------- -----------
Liabilities
---------------------------------- ---- --------- -----------
Loans and borrowings 22 14,722 68,544
---------------------------------- ---- --------- -----------
Finance lease liabilities 23 3,001 2,990
---------------------------------- ---- --------- -----------
Deferred tax liabilities 24 10,702 19,561
---------------------------------- ---- --------- -----------
Trade and other payables 26 20,746 20,858
---------------------------------- ---- --------- -----------
Deferred revenue 25 - 6,985
---------------------------------- ---- --------- -----------
Non-current liabilities 49,171 118,938
---------------------------------- ---- --------- -----------
Loans and borrowings 22 2,006 21,171
---------------------------------- ---- --------- -----------
Finance lease liabilities 23 4 8
---------------------------------- ---- --------- -----------
Trade and other payables 26 6,309 16,193
---------------------------------- ---- --------- -----------
Deferred revenue 25 3,621 13,834
---------------------------------- ---- --------- -----------
Liabilities held for sale 17 139,497 25,766
---------------------------------- ---- --------- -----------
Current liabilities 151,437 76,972
---------------------------------- ---- --------- -----------
Total liabilities 200,608 195,910
---------------------------------- ---- --------- -----------
Total equity and liabilities 390,986 394,738
---------------------------------- ---- --------- -----------
Net asset value ('NAV') per share
(EUR) 27 0.21 0.21
---------------------------------- ---- --------- -----------
Condensed consolidated interim statement of changes in equity
For the six-month period ended 30 June 2018
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
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
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 1 January
2018 9,046 569,847 5,368 7,544 (397,746) 194,059 4,769 198,828
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TOTAL COMPREHENSIVE
INCOME
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Loss - - - - (13,729) (13,729) (408) (14,137)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Other comprehensive
income
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Foreign currency
translation
differences - - 1,194 - - 1,194 - 1,194
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Revaluation of
property,
plant and equipment,
net of tax - - - 8,480 - 8,480 - 8,480
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Transfer of
revaluation
reserve to retained
earnings
due to disposal - - - (182) 182 - - -
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total other
comprehensive
income - - 1,194 8,298 182 9,674 - 9,674
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total comprehensive
income - - 1,194 8,298 (13,547) (4,055) (408) (4,463)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
TRANSACTIONS WITH OWNERS
OF THE COMPANY
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Contributions and
distributions
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Equity-settled
share-based
payment arrangements - - - - 8 8 - 8
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total contribution and
distributions - - - - 8 8 - 8
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Changes in ownership
interests
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Disposal of subsidiary
with non-controlling
interests - - - - - - (3,995) (3,995)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total changes in
ownership
interests - - - - - - (3,995) (3,995)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Total transactions with
owners of the Company - - - - 8 8 (3,995) (3,987)
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Balance at 30 June 2018 9,046 569,847 6,562 15,842 (411,285) 190,012 366 190,378
------------------------ ------- ------- ----------- ----------- --------- --------- --------------- ---------
Condensed consolidated interim statement of cash flows
For the six-month period ended 30 June 2018
From 1 January From 1 January
2018 2017
to 30 June to 30 June
2018 2017
EUR'000 EUR'000
------------------------------------------- -------------- --------------
Cash flows from operating activities
------------------------------------------- -------------- --------------
(Loss)/profit (14,137) 2,192
-------------------------------------------- -------------- --------------
Net change in fair value of investment
property (1,277) -
-------------------------------------------- -------------- --------------
Loss/(gain) on disposal of investment
in subsidiaries 1,182 (299)
-------------------------------------------- -------------- --------------
Gain on disposal of equity-accounted
investees held for sale - (4)
-------------------------------------------- -------------- --------------
Other adjustments 7,302 (11,504)
-------------------------------------------- -------------- --------------
(6,930) (9,615)
------------------------------------------- -------------- --------------
Changes in:
------------------------------------------- -------------- --------------
Receivables 3,210 (4,563)
-------------------------------------------- -------------- --------------
Payables 2,005 3,785
-------------------------------------------- -------------- --------------
Cash used in operating activities (1,715) (10,393)
-------------------------------------------- -------------- --------------
Tax received 99 9
-------------------------------------------- -------------- --------------
Net cash used in operating activities (1,616) (10,384)
-------------------------------------------- -------------- --------------
Cash flows from investing activities
------------------------------------------- -------------- --------------
Proceeds from disposal of subsidiaries,
net of cash disposed of 16,933 26,293
-------------------------------------------- -------------- --------------
Proceeds from disposal of equity-accounted
investees held for sale - 700
-------------------------------------------- -------------- --------------
Net acquisitions of investment property (15) (5)
-------------------------------------------- -------------- --------------
Net acquisitions of property, plant
and equipment (106) (135)
-------------------------------------------- -------------- --------------
Net change in trading properties 42 (258)
-------------------------------------------- -------------- --------------
Net change in net assets held for
sale 105 641
============================================ ============== ==============
Net cash from investing activities 16,959 27,236
-------------------------------------------- -------------- --------------
Cash flows from financing activities
------------------------------------------- -------------- --------------
Funds received from non-controlling
interests - 95
-------------------------------------------- -------------- --------------
Change in loans and borrowings - (1,922)
============================================ ============== ============== Change in finance lease obligations 7 14 ============================================ ============== ============== Interest paid (2,703) (5,084) ============================================ ============== ============== Net cash used in financing activities (2,696) (6,897) -------------------------------------------- -------------- -------------- Net increase in cash and cash equivalents 12,647 9,955 -------------------------------------------- -------------- -------------- Cash and cash equivalents at the beginning of the period 2,444 4,698 -------------------------------------------- -------------- -------------- Effect of movement in exchange rates on cash held (2) - -------------------------------------------- -------------- -------------- Cash and cash equivalents reclassified to assets held for sale (2,350) - -------------------------------------------- -------------- -------------- Cash and cash equivalents at the end of the period 12,739 14,653 -------------------------------------------- -------------- -------------- 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) 12,739 14,653 -------------------------------------------- -------------- -------------- Cash and cash equivalents at the end of the period 12,739 14,653 -------------------------------------------- -------------- --------------
Notes to the condensed consolidated interim financial statements
For the six-month period ended 30 June 2018
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 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 2018 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 2017. 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 27 September 2018.
(b) Basis of preparation
The condensed consolidated interim financial statements of the Company for the six-month period ended 30 June 2018 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 after 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 2017.
Comparatives
Comparative figures have been adjusted to reflect the required changes in presentation in relation to the agreement to dispose the "Amanzoe" project and the presentation of its "Hotel and Leisure" segment as a discontinued operation (see note 10).
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 2017.
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 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 condensed consolidated interim financial statements.
5. PRINCIPAL SUBSIDIARIES
As at 30 June 2018, the Group's most significant subsidiaries were the following:
Country of Shareholding
Name Project incorporation interest
---------------------------------- ------------------- --------------- -------------
Scorpio Bay
Scorpio Bay Holdings Limited Resort Cyprus 100%
================================== =================== =============== =============
Scorpio Bay
Scorpio Bay Resorts S.A. Resort Greece 100%
================================== =================== =============== =============
Lavender Bay
Xscape Limited Resort Cyprus 100%
================================== =================== =============== =============
Lavender Bay
Golfing Developments S.A. Resort Greece 100%
================================== =================== =============== =============
Kilada Hills
MindCompass Overseas Limited Golf Resort Cyprus 100%
================================== =================== =============== =============
Kilada Hills
MindCompass Overseas S.A. Golf Resort Greece 100%
================================== =================== =============== =============
Kilada Hills
MindCompass Overseas Two S.A. Golf Resort Greece 100%
================================== =================== =============== =============
Kilada Hills
MindCompass Parks S.A. Golf Resort Greece 100%
================================== =================== =============== =============
Dolphin Capital Greek Collection Kilada Hills
Limited Golf Resort Cyprus 100%
================================== =================== =============== =============
DCI Holdings One Limited ('DCI
H1') Aristo Developers BVIs 100%
================================== =================== =============== =============
D.C. Apollo Heights Polo and Apollo Heights
Country Resort Limited Resort Cyprus 100%
================================== =================== =============== =============
Apollo Heights
Symboula Estates Limited Resort Cyprus 100%
================================== =================== =============== =============
DolphinCI Fourteen Limited
('DCI 14') Amanzoe Cyprus 100%
================================== =================== =============== =============
Eidikou Skopou Dekatessera
S.A. ('ES 14') Amanzoe Greece 100%
================================== =================== =============== =============
Eidikou Skopou Dekaokto S.A.
('ES 18') Amanzoe Greece 100%
================================== =================== =============== =============
Single Purpose Vehicle Two
Limited ('SPV 2') Amanzoe Cyprus 64%
================================== =================== =============== =============
Eidikou Skopou Eikosi Ena
S.A. Amanzoe Greece 64%
================================== =================== =============== =============
Azurna Uvala D.o.o. ('Azurna') Livka Bay Resort Croatia 100%
================================== =================== =============== =============
Eastern Crete Development
Company S.A. Plaka Bay Resort Greece 100%
================================== =================== =============== =============
DolphinLux 2 S.a.r.l. La Vanta Luxembourg 100%
================================== =================== =============== =============
Kalkan Yapi ve Turizm A.S.
('Kalkan') La Vanta Turkey 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 2018 From 1 January 2017
to 30 June 2018 to 30 June 2017
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 - 6,507 6,507 - 4,747 4,747
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Sale of trading and
investment properties 1,473 - 1,473 - - -
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Rental income 5 - 5 12 - 12
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Other income 73 - 73 709 - 709
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Total 1,551 6,507 8,058 721 4,747 5,468
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
7. COST OF SALES
From 1 January 2018 From 1 January 2017
to 30 June 2018 to 30 June 2017
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 - 2,824 2,824 - 2,096 2,096
-------------------------- ------------- --------------- -------- ------------ ------------- -----------
Sales of trading and
investment properties 1,117 - 1,117 - - -
-------------------------- ------------- --------------- -------- ------------ ------------- -----------
Personnel expenses (see
below) 388 2,298 2,686 295 2,254 2,549
-------------------------- ------------- --------------- -------- ------------ ------------- -----------
Branding management
fees 30 268 298 326 212 538
-------------------------- ------------- --------------- -------- ------------ ------------- -----------
Other operating expenses 37 51 88 44 143 187
-------------------------- ------------- --------------- -------- ------------ ------------- -----------
Total 1,572 5,441 7,013 665 4,705 5,370
-------------------------- ------------- --------------- -------- ------------ ------------- -----------
Personnel expenses
Continuing operations
From 1 January 2018
to 30 June 2018
=======================================
Hotel Project
& leisure maintenance
operations & development Total
EUR'000 EUR'000 EUR'000
------------------------------------------ ------------ --------------- --------
Wages and salaries - 302 302
------------------------------------------ ------------ --------------- --------
Compulsory social security contributions - 74 74
------------------------------------------ ------------ --------------- --------
Other personnel costs - 12 12
------------------------------------------ ------------ --------------- --------
Total - 388 388
------------------------------------------ ------------ --------------- --------
The average number of employees employed
by the Group during the period was - 26 26
------------------------------------------ ------------ --------------- --------
Discontinued operation
From 1 January 2018
to 30 June 2018
=======================================
Hotel Project
& leisure maintenance
operations & development Total
EUR'000 EUR'000 EUR'000
Wages and salaries 1,812 - 1,812
------------------------------------------ ------------ --------------- --------
Compulsory social security contributions 452 - 452
------------------------------------------ ------------ --------------- --------
Other personnel costs 34 - 34
------------------------------------------ ------------ --------------- --------
Total 2,298 - 2,298
------------------------------------------ ------------ --------------- --------
The average number of employees employed
by the Group during the period was 186 - 186
------------------------------------------ ------------ --------------- --------
Continuing operations
From 1 January 2017
to 30 June 2017
============================= ===========
Hotel Project
& leisure maintenance
operations & development Total
(Restated) (Restated) (Restated)
EUR'000 EUR'000 EUR'000
------------------------------------------ ------------ --------------- -----------
Wages and salaries - 233 233
------------------------------------------ ------------ --------------- -----------
Compulsory social security contributions - 49 49
------------------------------------------ ------------ --------------- -----------
Other personnel costs - 13 13
------------------------------------------ ------------ --------------- -----------
Total - 295 295
------------------------------------------ ------------ --------------- -----------
The average number of employees employed
by the Group during the period was - 22 22
------------------------------------------ ------------ --------------- -----------
Discontinued operation
From 1 January 2017
to 30 June 2017
==========================================
Hotel Project
& leisure maintenance
operations & development Total
(Restated) (Restated) (Restated)
EUR'000 EUR'000 EUR'000
------------------------------------------ ------------ --------------- -----------
Wages and salaries 1,546 174 1,720
------------------------------------------ ------------ --------------- -----------
Compulsory social security contributions 385 37 422
------------------------------------------ ------------ --------------- -----------
Other personnel costs 69 43 112
------------------------------------------ ------------ --------------- -----------
Total 2,000 254 2,254
------------------------------------------ ------------ --------------- -----------
The average number of employees employed
by the Group during the period was 149 33 182
------------------------------------------ ------------ --------------- -----------
8. INCOME AND EXPENSES
. Disposal of investments
From 1 January 2018 From 1 January 2017
to 30 June 2018 to 30 June 2017
========================================== ========================================
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
------------------------- ----- ------------- --------------- ---------- ------------ ------------- -----------
(Loss)/gain on disposal
of investment in
subsidiaries 29 (1,182) - (1,182) - 299 299
------------------------- ----- ------------- --------------- ---------- ------------ ------------- -----------
Gain on disposal of
equity-accounted
investees held for sale 17 - - - 4 - 4
------------------------- ----- ------------- --------------- ---------- ------------ ------------- -----------
Total (1,182) - (1,182) 4 299 303
------------------------- ----- ------------- --------------- ---------- ------------ ------------- -----------
. Change in valuations
From 1 January 2018 From 1 January 2017
to 30 June 2018 to 30 June 2017
======================================== =========================== ===========
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 16 1,277 - 1,277 - - -
---------------------- ----- ------------- --------------- -------- ------------ ------------- -----------
Total 1,277 - 1,277 - - -
---------------------- ----- ------------- --------------- -------- ------------ ------------- -----------
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 & leisure Construction & Reportable 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 2018
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Revenue - 6,507 1,478 - 73 - 1,551 6,507
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Cost of sales - (5,441) (1,421) - (151) - (1,572) (5,441)
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Investment
Manager
remuneration - - - - (4,006) - (4,006) -
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Directors'
remuneration - - - - (318) - (318) -
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Depreciation
charge - (1,096) - - (15) - (15) (1,096)
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Professional
fees - - (277) - (2,040) - (2,317) -
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Administrative
and other
expenses - - (68) - (749) - (817) -
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Loss on
disposal of
investment
in
subsidiaries - - - - (1,182) - (1,182) -
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Net change in
fair value
of investment
property - - - - 1,277 - 1,277 -
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Results from
operating
activities - (30) (288) - (7,111) - (7,399) (30)
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Finance income - - 105 - (86) - 19 -
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Finance costs - (1,183) (2,242) - (2,628) - (4,870) (1,183)
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Net finance
costs - (1,183) (2,137) - (2,714) - (4,851) (1,183)
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Loss before
taxation - (1,213) (2,425) - (9,825) - (12,250) (1,213)
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Taxation - - (8) - (666) - (674) -
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Loss - (1,213) (2,433) - (10,491) - (12,924) (1,213)
---------------- ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Hotel & leisure Construction & Reportable 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
(Restated)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Revenue - 4,747 8 - 713 - 721 4,747
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Cost of sales - (4,337) (445) (368) (220) - (665) (4,705)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Investment
Manager
remuneration - - - - (4,606) - (4,606) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Directors'
remuneration - - - - (422) - (422) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Depreciation
charge - (1,171) (4) - - - (4) (1,171)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
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 - (761) (587) (477) (7,503) (607) (8,090) (1,845)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Finance income - - 85 - 3,883 13,415 3,968 13,415
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Finance costs - (1,181) (1,350) - (1,635) - (2,985) (1,181)
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Net finance
(costs)/income - (1,181) (1,265) - 2,248 13,415 983 12,234
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
(Loss)/profit
before taxation - (1,942) (1,852) (477) (5,255) 12,808 (7,107) 10,389
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
Taxation - - (8) - (1,082) - (1,090) -
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
(Loss)/profit - (1,942) (1,860) (477) (6,337) 12,808 (8,197) 10,389
------------------ ----------- ------------- ----------- ------------- ----------- ------------- ----------- -------------
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 2018
---------------------------------------------------- --------------------------------------------------------------
Property, plant and equipment - 11,542 - 11,542 - 11,542
=================================== =============== ========== ======== ========== ============== ============
Investment property - 130,671 - 130,671 - 130,671
=================================== =============== ========== ======== ========== ============== ============
Trading properties - 10,700 - 10,700 - 10,700
=================================== =============== ========== ======== ========== ============== ============
Cash and cash equivalents - 2,101 10,638 12,739 - 12,739
=================================== =============== ========== ======== ========== ============== ============
Assets held for sale 886 221,264 2,764 224,914 - 224,914
=================================== =============== ========== ======== ========== ============== ============
Intra-group debit balances - 41,329 512,344 553,673 (553,673) -
=================================== =============== ========== ======== ========== ============== ============
Other assets - 344 76 420 - 420
=================================== =============== ========== ======== ========== ============== ============
Total assets 886 417,951 525,822 944,659 (553,673) 390,986
=================================== =============== ========== ======== ========== ============== ============
Loans and borrowings - 16,728 - 16,728 - 16,728
=================================== =============== ========== ======== ========== ============== ============
Finance lease liabilities - 3,005 - 3,005 - 3,005
=================================== =============== ========== ======== ========== ============== ============
Deferred tax liabilities - 10,702 - 10,702 - 10,702
=================================== =============== ========== ======== ========== ============== ============
Liabilities held for sale - 139,497 - 139,497 - 139,497
=================================== =============== ========== ======== ========== ============== ============
Intra-group credit balances - 411,091 142,582 553,673 (553,673) -
=================================== =============== ========== ======== ========== ============== ============
Other liabilities - 16,565 14,111 30,676 - 30,676
=================================== =============== ========== ======== ========== ============== ============
Total liabilities - 597,588 156,693 754,281 (553,673) 200,608
=================================== =============== ========== ======== ========== ============== ============
Revenue - 1,551 - 1,551 - 1,551
=================================== =============== ========== ======== ========== ============== ============
Cost of sales - (1,572) - (1,572) - (1,572)
=================================== =============== ========== ======== ========== ============== ============
Change in valuations - 1,277 - 1,277 - 1,277
=================================== =============== ========== ======== ========== ============== ============
Disposal of investments - (1,182) - (1,182) - (1,182)
=================================== =============== ========== ======== ========== ============== ============
Investment Manager remuneration - (635) (3,371) (4,006) - (4,006)
=================================== =============== ========== ======== ========== ============== ============
Other operating expenses - (2,140) (1,327) (3,467) - (3,467)
=================================== =============== ========== ======== ========== ============== ============
Net finance cost - (4,813) (38) (4,851) - (4,851)
=================================== =============== ========== ======== ========== ============== ============
Loss before taxation - (7,514) (4,736) (12,250) - (12,250)
=================================== =============== ========== ======== ========== ============== ============
Taxation - (674) - (674) - (674)
=================================== =============== ========== ======== ========== ============== ============
Loss from continuing operations - (8,188) (4,736) (12,924) - (12,924)
=================================== =============== ========== ======== ========== ============== ============
Loss from discontinued
operation, net of tax - (1,213) - (1,213) - (1,213)
=================================== =============== ========== ======== ========== ============== ============
Loss - (9,401) (4,736) (14,137) - (14,137)
=================================== =============== ========== ======== ========== ============== ============
Reportable
Americas(1) segment Consolidated
South-East
(Discontinued) Europe(2) Other(3) totals totals
Adjustments(4)
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
=========================== =============== ========== ========= ========== =============== ============
31 December 2017
=========================== =============== ========== ========= ========== =============== ============
Property, plant and
equipment - 87,551 - 87,551 - 87,551
=========================== =============== ========== ========= ========== =============== ============
Investment property - 138,672 - 138,672 - 138,672
=========================== =============== ========== ========= ========== =============== ============
Trading properties - 30,572 - 30,572 - 30,572
=========================== =============== ========== ========= ========== =============== ============
Cash and cash equivalents - 1,063 1,381 2,444 - 2,444
=========================== =============== ========== ========= ========== =============== ============
Assets held for sale 834 128,297 - 129,131 - 129,131
=========================== =============== ========== ========= ========== =============== ============
Intra-group debit balances - 50,670 594,368 645,038 (645,038) -
=========================== =============== ========== ========= ========== =============== ============
Other assets - 3,905 2,463 6,368 - 6,368
=========================== =============== ========== ========= ========== =============== ============
Total assets 834 440,730 598,212 1,039,776 (645,038) 394,738
=========================== =============== ========== ========= ========== =============== ============
Loans and borrowings - 89,715 - 89,715 - 89,715
=========================== =============== ========== ========= ========== =============== ============
Finance lease liabilities - 2,998 - 2,998 - 2,998
=========================== =============== ========== ========= ========== =============== ============
Deferred tax liabilities - 19,561 - 19,561 - 19,561
=========================== =============== ========== ========= ========== =============== ============
Liabilities held for sale - 25,766 - 25,766 - 25,766
=========================== =============== ========== ========= ========== =============== ============
Intra-group credit balances - 441,500 203,538 645,038 (645,038) -
=========================== =============== ========== ========= ========== =============== ============
Other liabilities - 56,029 1,841 57,870 - 57,870
=========================== =============== ========== ========= ========== =============== ============
Total liabilities - 635,569 205,379 840,948 (645,038) 195,910
=========================== =============== ========== ========= ========== =============== ============
30 June 2017 (Restated)
=========================== =============== ========== ========= ========== =============== ============
Revenue - 721 - 721 - 721
=========================== =============== ========== ========= ========== =============== ============
Cost of sales - (665) - (665) - (665)
=========================== =============== ========== ========= ========== =============== ============
Disposal of investments - 4 - 4 - 4
=========================== =============== ========== ========= ========== =============== ============
Investment Manager
remuneration - (700) (3,906) (4,606) - (4,606) =========================== =============== ========== ========= ========== =============== ============ Other operating expenses - (1,684) (1,860) (3,544) - (3,544) =========================== =============== ========== ========= ========== =============== ============ Net finance cost - 1,038 (55) 983 - 983 =========================== =============== ========== ========= ========== =============== ============ Loss before taxation - (1,286) (5,821) (7,107) - (7,107) =========================== =============== ========== ========= ========== =============== ============ Taxation - (1,090) - (1,090) - (1,090) =========================== =============== ========== ========= ========== =============== ============ Loss from continuing operations - (2,376) (5,821) (8,197) - (8,197) --------------------------- --------------- ---------- --------- ---------- --------------- ------------ Profit/(loss) from discontinued operation, net of tax 12,331 (1,942) - 10,389 - 10,389 --------------------------- --------------- ---------- --------- ---------- --------------- ------------ Profit/(loss) 12,331 (4,318) (5,821) 2,192 - 2,192 --------------------------- --------------- ---------- --------- ---------- --------------- ------------
1 Americas includes the investment in Itacare Capital Investments Ltd ('Itacare') (see note 17). Also includes the Group's activities in the Republic of Panama as of 30 June 2017.
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 2017 and the first half of 2018, 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 three years by the Cypriot government.
Greece
Gross Domestic Product of Greece grew 1.4% in 2017 compared to 2016 while the Hellenic Statistical Authority revised higher growth rates to +2.5% (from 2.3%) year-on-year for the first quarter of 2018 and the country also realized a 1.8% year-on-year GDP increase in the second quarter of 2018. In addition, macroeconomic indicators have been quite encouraging about the country's economic perspectives and following the upgrade in the country's credit rating by S&P in January 2018, Fitch and Moody's also proceeded with corresponding upgrades in February 2018 and made very favourable assessments of the Greek economy's progress. In August 2018 Greece successfully exited its final, three-year bailout program, agreed in August 2015 to help it cope with the continued fallout from a debt crisis.
The tourism sector is expected to have a significant impact on the recovery of the country's economy and on curbing the external trade deficit. According to the latest data issued by the Bank of Greece, more than 27 million tourists (excluding cruise passengers) arrived in Greece in 2017, recording a rise of c.10%, while travel receipts during the same period totalled EUR14.6 billion, up 10.5% compared to 2016. The balance of travel services in the January-June 2018 period showed a surplus of EUR3.76 million compared to a surplus of EUR3.14 million in the corresponding period in 2017, partly due to an 18.9 percent increase in travel receipts.
Cyprus
The emerging economic recovery has been reinforced since the conclusion of the three-year European Stability Mechanism financial assistance programme on 31 March 2016, placing the island amongst the highest accelerating economies in Europe with the economy expanding by 3.4% year-on-year in 2017, driven mainly by improved levels of private consumption and a record year for the tourism industry. GDP growth rate in real terms during the second quarter of 2018 is positive and estimated at +3.9% over the corresponding quarter of 2017.
Fitch has upgraded its rating on Cyprus' to 'BB+' from 'BB' because of the country's strong cyclical economic recovery and prudent fiscal policy. Fitch's rating on Cyprus is now just one step below investment grade and the outlook is positive, although the weakness in the banking sector is still a risk to public finances.
The available data for the tourism industry highlighted, once again, that tourism was amongst one of the key catalysts for the country's 2017 economic performance, Tourist arrivals in Cyprus recorded an impressive increase in 2017, according to the Cyprus Tourism Organisation (CTO). For the period of January - December 2017 tourist arrivals totalled 3.7 million, recording an increase of 14.6% and outnumbering the total arrivals ever recorded in Cyprus during a year. For the period of January to June 2018, more than 1.6 million tourists visited the country, compared to 1.46 million for the same period last year recording an increase of 12.4%. As reported by the country's Statistical Service, this number exceeds the total arrivals ever recorded in Cyprus during the first six months of the year.
10. DISCONTINUED OPERATION
Subsequent to 30 June 2018, as also mentioned in note 33, the Group entered into a conditional agreement for the disposal of DCI 14 (owner of 'Amanzoe' project in Greece). Part of Amanzoe constituted the 'Hotel and Leisure' operations of the Group, which as at 30 June 2018, is presented as a discontinued operation.
As at 30 June 2017, 'Hotel and Leisure' operation 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.
Also during the first quarter of 2017, the Group sold Pearl Island project ('Pearl Island' in Republic of Panama). Pearl Island constituted the operations of the Group in the geographical area of Americas, which as at 30 June 2017, was presented as a discontinued operation.
Results of discontinued operation
From 1 January From 1 January
2018 2017
to 30 June to 30 June
2018 2017
(Restated)
Note EUR'000 EUR'000
------------------------------------ ----- --------------- ---------------
Revenue 6 6,507 4,747
------------------------------------ ----- --------------- ---------------
Expenses
------------------------------------ ----- --------------- ---------------
Cost of sales 7 (5,441) (4,705)
------------------------------------ ----- --------------- ---------------
Depreciation charge (1,096) (1,171)
------------------------------------ ----- --------------- ---------------
Professional fees 11 - (82)
------------------------------------ ----- --------------- ---------------
Administrative and other expenses 12 - (933)
------------------------------------ ----- --------------- ---------------
Net finance (costs)/income (1,183) 12,234
------------------------------------ ----- --------------- ---------------
Results from operating activities (1,213) 10,090
------------------------------------ ----- --------------- ---------------
Taxation - -
------------------------------------ ----- --------------- ---------------
Results from operating activities,
net of tax (1,213) 10,090
------------------------------------ ----- --------------- ---------------
Gain on disposal of discontinued
operation 8A - 299
------------------------------------ ----- --------------- ---------------
(Loss)/profit from discontinued
operation, net of tax (1,213) 10,389
------------------------------------ ----- --------------- ---------------
Cash flows used in discontinued operation
From 1 January From 1 January
2018 2017
to 30 June to 30 June
2018 2017
(Restated)
EUR'000 EUR'000
--------------------------------------- --------------- ---------------
Net cash from/(used in) operating
activities 2,674 (20,020)
---------------------------------------- --------------- ---------------
Net cash (used in)/from investing
activities (102) 26,159
---------------------------------------- --------------- ---------------
Net cash used in financing activities (1,043) (2,361)
---------------------------------------- --------------- ---------------
Net cash flows for the period 1,529 3,778
---------------------------------------- --------------- ---------------
11. PROFESSIONAL FEES
From 1 January 2018 From 1 January 2017
to 30 June 2018 to 30 June 2017
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 333 - 333 555 19 574
------------------------ ------------- --------------- -------- ------------ ------------- -----------
Auditors' remuneration
(see below) 194 - 194 166 28 194
------------------------ ------------- --------------- -------- ------------ ------------- -----------
Accounting expenses 127 - 127 140 - 140
------------------------ ------------- --------------- -------- ------------ ------------- -----------
Project design and
development fees 1,343 - 1,343 1,011 21 1,032
------------------------ ------------- --------------- -------- ------------ ------------- -----------
Consultancy fees 76 - 76 169 - 169
------------------------ ------------- --------------- -------- ------------ ------------- -----------
Administrator fees 25 - 25 35 - 35
------------------------ ------------- --------------- -------- ------------ ------------- -----------
Other professional
fees 219 - 219 235 14 249
------------------------ ------------- --------------- -------- ------------ ------------- -----------
Total 2,317 - 2,317 2,311 82 2,393
------------------------ ------------- --------------- -------- ------------ ------------- -----------
From 1 January 2018 From 1 January 2017
to 30 June 2018 to 30 June 2017
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 194 - 194 134 28 162
-------------------------- ------------- --------------- -------- ------------ ------------- -----------
Tax and advisory - - - 32 - 32
-------------------------- ------------- --------------- -------- ------------ ------------- -----------
Total 194 - 194 166 28 194
-------------------------- ------------- --------------- -------- ------------ ------------- -----------
12. ADMINISTRATIVE AND OTHER EXPENSES
From 1 January 2018 From 1 January 2017
to 30 June 2018 to 30 June 2017
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 67 - 67 139 - 139
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Insurance 23 - 23 31 - 31
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Repairs and maintenance 124 - 124 61 5 66
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Marketing and advertising
expenses 73 - 73 76 14 90
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Rents 63 - 63 68 23 91
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Other 467 - 467 432 891 1,323
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
Total 817 - 817 807 933 1,740
------------------------------ ------------- --------------- -------- ------------ ------------- -----------
13. Taxation
From 1 January From 1 January
2018 2017
to 30 June to 30 June
2018 2017
(Restated)
EUR'000 EUR'000
RECOGNISED IN PROFIT OR LOSS
Income tax 1 (35)
---------------------------------------------- --------------- ---------------
Net deferred tax 673 1,125
============================================== =============== ===============
Total 674 1,090
---------------------------------------------- --------------- ---------------
RECOGNISED IN OTHER COMPREHENSIVE INCOME
---------------------------------------------- --------------- ---------------
Revaluation of property, plant and equipment 3,463 -
---------------------------------------------- --------------- ---------------
Total 3,463 -
---------------------------------------------- --------------- ---------------
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
2018 to 30 June From 1 January 2017
2018 to 30 June 2017
----------------------------------------- ----------------------------------------
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) (12,561) (1,168) (13,729) (8,120) 5,438 (2,682)
---------------------------- ------------- --------------- --------- ------------ ------------- -----------
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) (0.014) (0.001) (0.015) (0.009) 0.006 (0.003)
---------------------------- ------------- --------------- --------- ------------ ------------- -----------
(Loss)/profit attributable to owners of the Company
From 1 January
2018 to 30 June From 1 January 2017
2018 to 30 June 2017
----------------------------------------- ----------------------------------------
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 (12,561) (1,168) (13,729) (8,120) 5,438 (2,682)
------------------------------- ------------- --------------- --------- ------------ ------------- -----------
(Loss)/profit attributable
to non-controlling interests (363) (45) (408) (77) 4,951 4,874
------------------------------- ------------- --------------- --------- ------------ ------------- -----------
Total (12,924) (1,213) (14,137) (8,197) 10,389 2,192
------------------------------- ------------- --------------- --------- ------------ ------------- -----------
Weighted average number of common shares outstanding
From 1 January From 1 January
2018 2017
to 30 June to 30 June
2018 2017
(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 2018 and 30 June 2017, 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.
15. Property, plant and equipment
Land and buildings Other Total
EUR'000 EUR'000 EUR'000
30 June 2018
-------------------------------------------------------------- ------------------- ---------- ----------
Cost or revalued amount
-------------------------------------------------------------- ------------------- ---------- ----------
At beginning of period 104,136 5,483 109,619
-------------------------------------------------------------- ------------------- ---------- ----------
Direct acquisitions 25 81 106
-------------------------------------------------------------- ------------------- ---------- ----------
Revaluation adjustment 4,441 - 4,441
============================================================== =================== ========== ==========
Reclassification to assets held for sale (88,626) (5,201) (93,827)
============================================================== =================== ========== ==========
At end of period 19,976 363 20,339
-------------------------------------------------------------- ------------------- ---------- ----------
Depreciation and impairment losses
-------------------------------------------------------------- ------------------- ---------- ----------
At beginning of period 18,608 3,460 22,068
-------------------------------------------------------------- ------------------- ---------- ----------
Depreciation charge for the period - continuing operations 15 - 15
============================================================== =================== ========== ==========
Depreciation charge for the period - discontinued operations 859 237 1,096
============================================================== =================== ========== ==========
Revaluation adjustment (7,502) - (7,502)
============================================================== =================== ========== ==========
Reclassification to assets held for sale (3,534) (3,346) (6,880)
============================================================== =================== ========== ==========
At end of period 8,446 351 8,797
-------------------------------------------------------------- ------------------- ---------- ----------
Carrying amounts 11,530 12 11,542
-------------------------------------------------------------- ------------------- ---------- ----------
Land &
buildings Other Total
EUR'000 EUR'000 EUR'000
==================================== ============ ========== ==========
31 December 2017
------------------------------------ ------------ ---------- ----------
Cost or revalued amount
------------------------------------ ------------ ---------- ----------
At beginning of year 99,561 5,409 104,970
------------------------------------ ------------ ---------- ----------
Direct acquisitions 60 124 184
------------------------------------ ------------ ---------- ----------
Direct disposals - (50) (50)
------------------------------------ ------------ ---------- ----------
Revaluation adjustment 4,515 - 4,515
------------------------------------ ------------ ---------- ----------
At end of year 104,136 5,483 109,619
------------------------------------ ------------ ---------- ----------
Depreciation and impairment losses
------------------------------------ ------------ ---------- ----------
At beginning of year 14,381 2,942 17,323
------------------------------------ ------------ ---------- ----------
Direct disposals - (19) (19)
------------------------------------ ------------ ---------- ----------
Depreciation charge for the year 1,771 537 2,308
------------------------------------ ------------ ---------- ----------
Impairment loss 2,466 - 2,466 ------------------------------------ ------------ ---------- ---------- Reversal of impairment loss (10) - (10) ------------------------------------ ------------ ---------- ---------- At end of year 18,608 3,460 22,068 ==================================== ============ ========== ========== Carrying amounts 85,528 2,023 87,551 ==================================== ============ ========== ==========
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 2017.
16. Investment property
31 December
Note 30 June 2018 2017
EUR'000 EUR'000
------------------------------------ ----- ------------- ------------
At beginning of period/year 138,672 176,548
------------------------------------ ----- ------------- ------------
Direct acquisitions 15 203
------------------------------------ ----- ------------- ------------
Transfers to trading properties 18 - (217)
------------------------------------ ----- ------------- ------------
Reclassification to assets
held for sale (9,293) (25,376)
------------------------------------ ----- ------------- ------------
Fair value adjustment - continuing
operations 1,277 (12,486)
------------------------------------ ----- ------------- ------------
At end of period/year 130,671 138,672
------------------------------------ ----- ------------- ------------
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 2017.
17. DISPOSAL GROUPS HELD FOR SALE
As already mentioned in note 10, the Company committed to the sale of Amanzoe through the sale of its holding company DCI 14. Accordingly, the assets and liabilities of Amanzoe are presented as a disposal group held for sale. Part of Amanzoe's operations constitute the discontinued 'Hotel and Leisure' operation and is also included in the geographical segment of 'South-East Europe'.
The Company also remains committed to its plan to sell five disposal groups which are presented as held for sale in 2017. These disposal groups are: Kea (owner of 'Kea Resort') 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 above 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' (Kea and Azurna).
As at 31 December 2017, Iktinos (owner of 'Sitia Bay Golf Resort') and Triopetra (owner of 'Triopetra Bay') in Greece was also presented as held for sale with their disposal being completed during the first half of 2018.
Impairment losses relating to the disposal group
No impairment losses have been recognised during the period ended 30 June 2018 and 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.
Assets and liabilities of disposal groups held for sale
As at 30 June 2018, the disposal groups comprised the following assets and liabilities:
Amanzoe Kea Azurna Kalkan Porto DCI Total
disposal disposal disposal disposal Heli H2 disposal
group group group group disposal group
group
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Property, plant
and equipment 86,947 - - 6 - - 86,953
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Investment property 9,293 21,360 30,973 - - - 61,626
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Equity-accounted
investees - - - - 1,025 42,694 43,719
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Deferred tax
assets 993 - - - - - 993
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Trading properties 19,830 - - 5,618 - - 25,448
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Trade and other
receivables 1,744 102 5 835 - - 2,686
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Cash and cash
equivalents 2,350 182 15 56 - - 2,603
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
121,157 21,644 30,993 6,515 1,025 42,694 224,028
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Available-for-sale
financial assets - - - - - - 886
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Assets held for
sale 224,914
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Loans and borrowings 74,301 - 7,652 - - - 81,953
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Deferred tax
liabilities 12,994 2,796 3,264 - - - 19,054
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Deferred revenue 20,031 - - - - - 20,031
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Trade and other
payables 9,561 7,871 960 67 - - 18,459
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Liabilities held
for sale 116,887 10,667 11,876 67 - - 139,497
---------------------- ---------- ---------- ---------- ---------- ---------- ------------- --------
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%.
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. 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 five 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 was 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 DCI H2 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 remaining holding of its Aristo shares, which corresponds to 47.9%. The Board remains committed to dispose of its holding in Aristo and realise value.
As at 30 June 2018 and as at 31 December 2017, the Company's holding of 47.9% has been classified as asset held for sale.
As at 31 December 2017, the disposal groups comprised the following assets and liabilities:
Iktinos Azurna Kalkan Kea Triopetra Porto DCI Total
disposal disposal disposal disposal disposal Heli H2 disposal
group group group group group disposal group
group
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Property, plant
and equipment 6,699 - 9 - - - - 6,708
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Investment property 14,544 30,960 - 20,940 4,436 - - 70,880
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Equity-accounted
investees - - - - - 926 42,694 43,620
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Trading properties - - 5,615 - - - - 5,615
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Trade and other
receivables 139 6 980 62 36 - - 1,223
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Cash and cash
equivalents 4 181 29 36 1 - - 251
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
21,386 31,147 6,633 21,038 4,473 926 42,694 128,297
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Available-for-sale
financial assets - - - - - - - 834
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Assets held for
sale 129,131
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Loans and borrowings - 8,165 - - - - - 8,165
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Deferred tax
liabilities 3,062 3,240 - 2,796 360 - - 9,458
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Trade and other
payables 311 965 79 6,775 13 - - 8,143
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Liabilities held
for sale 3,373 12,370 79 9,571 373 - - 25,766
--------------------- ---------- ---------- ---------- ---------- ---------- ---------- ------------- --------
Cumulative income or expenses included in other comprehensive income
No cumulative income or expenses relating to the disposal groups is included in other comprehensive income (30 June 2017: EUR10,270 thousand loss).
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 2017.
18. Trading properties
31 December
30 June 2018 2017
Note EUR'000 EUR'000
--------------------------------------- ---- ------------ -----------
At beginning of period/year 30,572 29,763
--------------------------------------- ---- ------------ -----------
Net direct (disposals)/acquisitions (42) 1,079
--------------------------------------- ---- ------------ -----------
Reversal of concession/write off
of land - 193
--------------------------------------- ---- ------------ -----------
Net transfers from investment property 16 - 217
--------------------------------------- ---- ------------ -----------
Reclassification to assets held
for sale (19,830) -
--------------------------------------- ---- ------------ -----------
Impairment loss - (680)
--------------------------------------- ---- ------------ -----------
At end of period/year 10,700 30,572
--------------------------------------- ---- ------------ -----------
19. TRADE AND OTHER RECEIVABLES
31 December
30 June 2018 2017
EUR'000 EUR'000
------------------------------------ ------------ -----------
Trade receivables 13 1,082
------------------------------------ ------------ -----------
VAT receivables - 561
------------------------------------ ------------ -----------
Other receivables 407 2,538
------------------------------------ ------------ -----------
Total trade and other receivables 420 4,181
------------------------------------ ------------ -----------
Prepayments and other assets - 1,193
------------------------------------ ------------ -----------
Total 420 5,374
------------------------------------ ------------ -----------
20. Cash and cash equivalents
31 December
30 June 2018 2017
EUR'000 EUR'000
---------------- ------------ -----------
Bank balances 12,737 2,421
---------------- ------------ -----------
Cash in hand 2 23
---------------- ------------ -----------
Total 12,739 2,444
---------------- ------------ -----------
During the period, the Group had no fixed deposits.
21. CAPITAL AND RESERVES
Capital
Authorised share capital
30 June 2018 31 December 2017
------------------ ------------------
'000 of '000 of
shares EUR'000 shares EUR'000
------------------------- --------- ------- --------- -------
Common shares of EUR0.01
each 2,000,000 20,000 2,000,000 20,000
------------------------- --------- ------- --------- -------
Movement in share capital and premium
Shares in Share capital Share premium
'000 EUR'000 EUR'000
--------------------------- ---------- -------------- --------------
Capital at 1 January 2017
and 30 June 2018 904,627 9,046 569,847
--------------------------- ---------- -------------- --------------
Reserves
Translation reserve
Translation reserve comprises all foreign currency differences arising from the translation of the interim financial statements of foreign operations.
Revaluation reserve
Revaluation reserve relates to the revaluation of property, plant and equipment from both subsidiaries and equity-accounted investees, net of any deferred tax.
22. LOANS AND BORROWINGS
Within one Within two More than
Total year to five years five years
-------------------- -------------------- -------------------- --------------------
30 June 31 December 30 June 31 December 30 June 31 December 30 June 31 December
2018 2017 2018 2017 2018 2017 2018 2017
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Loans in Euro 16,728 89,715 2,006 21,171 14,722 55,474 - 13,070
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Loans in Euro within
disposal groups
held for sale 81,953 8,165 8,084 8,165 61,011 - 12,858 -
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
Total 98,681 97,880 10,090 29,336 75,733 55,474 12,858 13,070
--------------------- ------- ----------- ------- ----------- ------- ----------- ------- -----------
As of 30 June 2018, there were no significant changes in terms and conditions of the outstanding loans, compared to 31 December 2017.
1 January New Capital Interest Other 30 June
2018 issues repayments paid movements 2018
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
----------------------- ---------- -------- ------------ --------- ----------- --------
Loans in Euro 16,168 - - - 560 16,728
----------------------- ---------- -------- ------------ --------- ----------- --------
Loans in Euro within
disposal groups held
for sale 81,712 - (500) (2,773) 3,514 81,953
----------------------- ---------- -------- ------------ --------- ----------- --------
Total 97,880 - (500) (2,773) 4,074 98,681
----------------------- ---------- -------- ------------ --------- ----------- --------
Securities
As of 30 June 2018, there were no significant changes in the Group's loan securities compared to 31 December 2017. The securities include mortgages against immovable property, pledge of shares, fixed and floating charges over assets and corporate guarantees.
23. Finance lease LIABILITIES
30 June 2018 31 December 2017
-------------------------------- ---------------------------------
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 4 - 4 8 - 8
--------------------- --------- -------- ----------- --------- -------- ------------
Between two and five
years 156 4 152 154 6 148
--------------------- --------- -------- ----------- --------- -------- ------------
More than five years 4,025 1,176 2,849 4,133 1,291 2,842
--------------------- --------- -------- ----------- --------- -------- ------------
Total 4,185 1,180 3,005 4,295 1,297 2,998
--------------------- --------- -------- ----------- --------- -------- ------------
The major finance lease liabilities comprise leases in Greece with 99-year lease terms.
24. Deferred tax assets and liabilities
31 December
30 June 2018 2017
--------------------------- ---------------------------
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 994 (19,561) 996 (24,255)
----------------------------------------- ---------- --------------- ---------- ---------------
Recognised in profit or loss -
continuing operations (1) (672) (2) 2,847
----------------------------------------- ---------- --------------- ---------- ---------------
Recognised in other comprehensive
income - (3,463) - (1,309)
========================================= ========== =============== ========== ===============
Reclassification to (assets)/liabilities
held for sale (993) 12,994 - 3,156
========================================= ========== =============== ========== ===============
Balance at the end of the period/year - (10,702) 994 (19,561)
----------------------------------------- ---------- --------------- ---------- ---------------
Deferred tax assets and liabilities are attributable to the following:
30 June 2018 31 December 2017
Deferred Deferred Deferred Deferred
tax assets tax liabilities tax assets tax liabilities
EUR'000 EUR'000 EUR'000 EUR'000
---------------------------- ---------- --------------- ---------- ---------------
Revaluation of investment
property - (9,536) - (9,550)
---------------------------- ---------- --------------- ---------- ---------------
Revaluation of trading
properties - - - (2,163)
---------------------------- ---------- --------------- ---------- ---------------
Revaluation of property,
plant and equipment - (1,166) - (7,143)
============================ ========== =============== ========== ===============
Other temporary differences - - - (705)
---------------------------- ---------- --------------- ---------- ---------------
Tax losses - - 994 -
---------------------------- ---------- --------------- ---------- ---------------
Total - (10,702) 994 (19,561)
---------------------------- ---------- --------------- ---------- ---------------
25. DEFERRED REVENUE
31 December
30 June 2018 2017
EUR'000 EUR'000
------------------------- ------------- ------------
Prepayment from clients 3,621 13,834
------------------------- ------------- ------------
Government grant - 6,985
------------------------- ------------- ------------
Total 3,621 20,819
------------------------- ------------- ------------
31 December
30 June 2018 2017
EUR'000 EUR'000
============= ============= ============
Non-current - 6,985
============= ============= ============
Current 3,621 13,834
============= ============= ============
Total 3,621 20,819
------------- ------------- ------------
26. Trade and other payables
31 December
30 June 2018 2017
EUR'000 EUR'000
------------------------------------ ------------ -----------
Trade payables - 814
------------------------------------ ------------ -----------
Land creditors 20,923 21,048
==================================== ============ ===========
Investment Manager fees 1,203 1,188
==================================== ============ ===========
Branding fees accrual - 2,684
------------------------------------ ------------ -----------
Litigation liability provision - 4,000
------------------------------------ ------------ -----------
Other payables and accrued expenses 4,929 7,317
------------------------------------ ------------ -----------
Total 27,055 37,051
------------------------------------ ------------ -----------
31 December
30 June 2018 2017
EUR'000 EUR'000
------------- ------------- ------------
Non-current 20,746 20,858
------------- ------------- ------------
Current 6,309 16,193
============= ============= ============
Total 27,055 37,051
------------- ------------- ------------
During 2017, the Company entered into new contracts in connection with the deferred purchase of land at Lavender Bay. The amount outstanding as at 31 December 2017 was EUR21,048 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 year ended 31 December 2017 and included in finance income in profit or loss.
A subsidiary of the Group is in dispute with a third party concerning a c. EUR4 million assignment of claims to this party by one of the subsidiary's contractors. Although the Group has recognized a EUR4 million provision regarding this claim, the Group's intention is to defend its position vigorously and its lawyers are handling the ongoing litigation. As at 30 June 2018, the EUR4 million provision is included in 'Trade and other payables' in Disposal Groups Held for Sale.
27. NAV per share
31 December
30 June 2018 2017
'000 '000
------------------------------------ ------------ -----------
Total equity attributable to owners
of the Company (EUR) 190,012 194,059
------------------------------------ ------------ -----------
Number of common shares outstanding
at end of period/year 904,627 904,627
------------------------------------ ------------ -----------
NAV per share (EUR) 0.21 0.21
------------------------------------ ------------ -----------
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 2018, 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
2018 2017
to 30 June to 30 June
2018 2017
EUR'000 EUR'000
------------------------------------ --------------- ---------------
Remuneration 310 388
------------------------------------ --------------- ---------------
Equity-settled share-based payment
arrangements 8 34
------------------------------------ --------------- ---------------
Total remuneration 318 422
------------------------------------ --------------- ---------------
The Directors' remuneration details for the six-month periods ended 30 June 2018 and 30 June 2017 were as follows:
From 1 January From 1 January
2018 2017
to 30 June to 30 June
2018 2017
EUR'000 EUR'000
--------------- --------------- ---------------
Andrew Coppel 115 115
--------------- --------------- ---------------
Graham Warner 85 86
--------------- --------------- ---------------
Robert Heller 30 101
--------------- --------------- ---------------
Mark Townsend 40 28
--------------- --------------- ---------------
Sue Farr 40 58
--------------- --------------- ---------------
Total 310 388
--------------- --------------- ---------------
Mr. Miltos Kambourides has waived his fees.
On 25 January 2018, Robert Heller and Sue Farr resigned from the Company's Board. Robert Heller no longer retains an interest in the stock options issued pursuant to the Company's Stock Option Programme.
28.2 Investment Manager remuneration
From 1 January From 1 January
2018 2017
to 30 June to 30 June
2018 2017
EUR'000 EUR'000
-------------------------- --------------- ---------------
Fixed management fee 2,500 3,000
-------------------------- --------------- ---------------
Variable management fees 1,506 1,606
-------------------------- --------------- ---------------
Total remuneration 4,006 4,606
-------------------------- --------------- ---------------
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
A 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, to the extent these are completed at 50% of relevant latest reported NAV. 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.
With regard to the disposal of Aristo and Pearl Island, the Manager will be entitled to a variable annual 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.
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. 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. Completion remains pending.
On 1 November 2017, the Company along with the project's current minority shareholder entered into an agreement through its relevant project subsidiary companies, for a EUR16 million equity investment by One & Only Resorts Limited ('One & Only') in exchange for a 40% shareholding in Single Purpose Vehicle Fourteen Ltd, holding company of 100% of Kea Resort. The consideration will be deployed in the development of the Kea Resort, with the transaction including the operation of the Kea Resort and its residences by One & Only through long-term management and branding agreements. Completion of the investment agreement is subject to the Company meeting certain conditions including the revision of the construction permits to reflect the redesign of the Kea Resort to meet One & Only brand standards and the completion of a EUR30 million senior loan facility against the project together with the finalisation of the turn-key construction contract. Completion and commencement of the Kea Resort's construction is also subject to an additional EUR4 million equity injection in the Kea Resort by third party investors.
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 2018 and 30 June 2017, the Group did not enter into any related party transactions.
29. Business combinations
On 18 January 2018, the Group entered into an agreement for the disposal of its entire interest of 77.8% in the Sitia Bay Golf Resort ('project') to its minority partner in the project, Iktinos Hellas S.A., for a consideration of EUR14 million. The first instalment of EUR1.4 million was received on 22 January 2018 while the remaining EUR12.6 million was received on 3 April 2018.
On 5 February 2018, the Group entered into an agreement for the disposal of its entire interest of 100% in the Triopetra project to Deniage Ltd ('Deniage'). Deniage purchased the Group's entire shareholding interest for a total cash consideration of EUR4.1 million. The amount of EUR4 million was received on 5 February 2018 while the remaining EUR100 thousand will be withheld until the first anniversary from the transaction to cover any potential latent project liabilities.
Sitia
Bay Triopetra Total
EUR'000 EUR'000 EUR'000
--------- ---------- ---------
Investment property (14,544) (4,436) (18,980)
-------------------------------- --------- ---------- ---------
Property, plant and equipment (6,698) - (6,698)
-------------------------------- --------- ---------- ---------
Receivables and other assets (138) (36) (174)
-------------------------------- --------- ---------- ---------
Cash and cash equivalents (4) - (4)
-------------------------------- --------- ---------- ---------
Deferred tax liabilities 3,062 359 3,421
-------------------------------- --------- ---------- ---------
Trade and other payables 310 12 322
-------------------------------- --------- ---------- ---------
Net assets (18,012) (4,101) (22,113)
-------------------------------- --------- ---------- ---------
Net assets disposed of -
77.8%/100% (14,018) (4,101) (18,119)
-------------------------------- --------- ---------- ---------
Net proceeds on disposal 13,440 3,497 16,937
-------------------------------- --------- ---------- ---------
Loss on disposal recognised
in profit or loss (578) (604) (1,182)
-------------------------------- --------- ---------- ---------
Cash effect on disposal:
------------------------------- --------- ---------- ---------
Net proceeds on disposal 13,440 3,497 16,937
-------------------------------- --------- ---------- ---------
Cash and cash equivalents (4) - (4)
-------------------------------- --------- ---------- ---------
Net cash inflow on disposal 13,436 3,497 16,933
-------------------------------- --------- ---------- ---------
On 17 January 2017, the Company signed a share purchase agreement with Grivalia Hospitality S.A. ('Grivalia') for the sale of its 60% shareholding in all entities related with the Pearl Island. 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 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 while the escrowed amount of EUR2 million was received in full on 16 March 2018.
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
-------------------------------------------- ---------
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 2017.
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 2018, the Group had a total of EUR3,173 thousand contractual capital commitments on property, plant and equipment (31 December 2017: EUR2,695 thousand).
Non-cancellable operating lease rentals are payable as follows:
31 December
30 June 2018 2017
EUR'000 EUR'000
-------------------------- ------------ -----------
Less than one year 186 20
-------------------------- ------------ -----------
Between one and two years 9 11
-------------------------- ------------ -----------
Total 195 31
-------------------------- ------------ -----------
32. Contingent liabilities
Companies of the Group are involved in pending litigation. Such litigation principally relates to day-to-day operations as a developer of second-home residences and largely derives 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 condensed 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. SUBSEQUENT EVENTS
On 1 August 2018, the Group entered into a conditional agreement for the disposal of its 100% interest in the Amanzoe project and the sale of 20 Kilada Hills Golf plots to Grivalia.
Grivalia will purchase the Group's entire shareholding interest in Amanzoe through the acquisition of 100% of the shares in DCI 14, the holding company owning the project, for a total cash consideration of EUR5.8 million. Completion of the disposal is conditional on the completion of certain procedural steps for the transfer of the respective shares and the finalization of certain legal opinions relating to the transaction.
As part of the agreement, Grivalia will purchase 20 Golf plots in Dolphin's Kilada Hills Golf project for a EUR10 million cash consideration. Completion is conditional on the Company securing a senior development loan for the project, the issuance of final building permits and the tendering of a construction contract for the project's first phase development.
There were no other material events after the reporting period which have a bearing on the understanding of the condensed consolidated interim financial statements as at 30 June 2018.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
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