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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Global Ports Holding Plc | LSE:GPH | London | Ordinary Share | GB00BD2ZT390 | ORD GBP0.01 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| -3.25 | -1.62% | 196.75 | 196.00 | 197.50 | 202.00 | 196.00 | 200.00 | 58,063 | 16:35:08 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Marine Cargo Handling | 213.6M | -25M | -0.3674 | -5.33 | 133.35M |
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Global Ports Holding PLC (GPH)
Interim Results 2020
20-Aug-2020 / 07:04 GMT/BST
Dissemination of a Regulatory Announcement, transmitted by EQS Group.
The issuer is solely responsible for the content of this announcement.
Global Ports Holding Plc
Interim results for the six months ended 30 June 2020
Global Ports Holding Plc ("GPH" or "Group"), the world's largest independent cruise port operator, today announces its
unaudited results for the six months ended 30 June 2020.
Financial H1 2020 H1 2020 H1 2019 YoY Growth YoY CCY
Summary
CCY6 (%) Growth (%)
Total Revenue 54.2 54.4 54.6 -0.8% -0.3%
($m) 1
Cruise Revenue 33.9 34.0 23.9 41.9% 42.5%
($m) 8
Ex IFRIC 12 11.9 23.9 -50.1%
Cruise Revenue
($m)10
Commercial 20.3 20.4 30.8 -33.9% -33.6%
Revenue ($m)
Segmental 16.8 16.9 39.1 -56.9% -56.8%
EBITDA ($m) 2
Cruise EBITDA 3.9 3.9 16.8 -76.9% -76.7%
($m) 9
Commercial 12.9 13.0 22.3 -41.9% -41.8%
EBITDA ($m)
Adjusted 13.5 13.5 34.8 -61.2% -61.1%
EBITDA ($m)
Segmental 31.1% 31.0% 71.6%
EBITDA Margin
Cruise Margin 11.5% 11.5% 70.5%
Commercial 63.6% 63.5% 72.4%
Margin
Adjusted 24.9% 24.9% 63.7%
EBITDA Margin3
Operating (19.6) 1.3 -1622%
Profit ($m)
Profit/(Loss) (42.0) (13.8) 203.4%
before tax
($m)
Profit/(Loss) (34.9) (15.8) 121.3%
after tax ($m)
Underlying (3.5) 6.0 -158.8%
profit for the
period ($m) 4
Adjusted EPS (5.6) 9.5 -158.8%
(c) 5
DPS (c) n/a 19.9
Net Debt 436.9 351.1 24.4%
Net Debt 372.6 286.8 29.9%
excluding IFRS
16 Finance
Lease
Cash and cash 122.3 58.9 107.6%
equivalents
KPIs
Passengers (m 1.3 2.0 -35.7%
PAX) 7
General & Bulk 583 458 27.3%
Cargo ('000
tons)
Container 91 106 -13.8%
Throughput
('000 TEU)
Emre Sayin, Chief Executive Officer, said:
"With the Covid-19 crisis continuing to cause unprecedented disruption to both global economies and the global travel
sector, cash preservation remains the key focus of the Group. Our flexible business model and our decisive actions to
reduce costs early in the crisis means that the Group is well positioned to navigate through it.
While cruise volumes remain very low versus historical standards, we currently expect a steady increase in cruise ship
calls and passenger volumes over the remainder of the year. And it is encouraging to note that our cruise line partners
continue to report strong bookings for 2021. In the meantime, we continue to work closely with all relevant partners and
health authorities on the safe return to cruising across our portfolio.
When the cruise industry begins to exit this crisis in a meaningful way, we expect significant new cruise port
opportunities will present themselves. As the world's largest cruise port operator, with a proven and flexible business
model, an ability to bring global best practice to ports and destinations, including leading health and safety standards,
as well as the ability to combine the raising of financing for new projects with a flexible approach to cruise port
concession and management, Global Ports Holding remains in a strong position to play a leading role as new opportunities
arise."
Overview
· The Covid-19 crisis has caused unprecedented disruption to global economies and the global travel sector, and has had
a significant, negative impact on the business. The global cruise industry effectively shut down in Q2 2020, for the
first time in its history and as a result our cruise ports have experienced a sharp fall in revenues. While our
Commercial ports are exposed to global economic growth and macro-economic factors which have been impacted by Covid-19,
trading at these ports in Q2 has been broadly in line with Q1 trading.
· Total consolidated revenues were $54.2m in the period down 0.8% yoy (-0.3% ccy). Cruise Revenue grew 41.9% reflecting
the impact of IFRIC-12 on Nassau Cruise Port. IFRIC-12 results in $22.0m of construction revenue being recognised in
respect of construction services provided at Nassau Cruise Port. IFRIC-12 has no impact on cash generation. Excluding
this impact Cruise Revenue fell 50.1%. Commercial Revenue fell 33.9% in the period, primarily driven by the impact of
the previously disclosed oil services contract in H1 2019, excluding this impact Commercial Revenue fell 19.1%.
· Segmental EBITDA fell 56.9% (56.8% ccy) to $16.8m. With Cruise EBITDA falling 76.9% (76.7% ccy) to $3.9m, excluding
the IFRIC-12 impact on Nassau Cruise Port, Cruise EBITDA fell 79.5%. Commercial EBITDA fell 41.9% (41.8% ccy) to
$12.9m, excluding the impact of the 2019 oil services contract, Commercial EBITDA fell by 25.9%. Despite the onset of
the Covid-19 crisis, Q2 Commercial EBITDA was stable at -0.6% QoQ.
· H1 Adjusted EBITDA fell 61.2% (61.1% ccy) to $13.5m, down from to $34.8m in H1 2019. Central costs were reduced by
22.1% in the period, reflecting the prompt actions taken in Q2. The cost reduction program has reduced costs by about
two thirds compared to Q1 2020, the full impact of which will be visible during H2-2020.
· The operating loss of $19.6m in the period compared to a H1 2019 operating profit of $1.3m, is largely driven by the
$21.3m fall in Adjusted EBITDA yoy. The operating loss is Adjusted EBITDA after port operating rights amortisation
expense of $21.0m (H1 2019: $16.9m), amortisation of $6.0m (H1 2019: $6.4m) and one off adjustments and non-operating
expenses of $5.4m (H1 2019: $6.9m).
· Loss after tax for the period of $34.9 million (H1 2019: $15.8m) is driven by an increase in net finance costs to
$23.0m (H1 2019: $18.4m), a fall in in income from equity accounted associates to $0.7m (H1 2019: $3.3m), while there
was a tax credit of $7.1m in the period, compared to a tax expense of $1.9m in H1 2019. The increased net finance costs
are due to non-cash loss when revaluing the Eurobond debt, along with non-cash revaluation losses on Turkish entities
foreign currency dominated liabilities and the increase in net interest expenses increased to $13.9m (H1 2019: $14.3m).
The tax credit reflects the impact of the loss before tax in the period.
· Underlying profit for the period of -$3.5m reflects the loss after tax adjusted for port operating rights
amortisation expense of $21.0m (H1 2019: $16.9m).
· Net debt of $436.9m (31 December 2019: $389.2m) increased due to additional financial indebtedness incurred in
relation to the Caribbean growth projects for Nassau Cruise Port ($150m unsecured 20-year bond completed in May 2020)
and further drawdowns under the Capex facility at Antigua Cruise Port, partially offset by scheduled repayments in
other indebtedness and an increase in cash. The leverage ratio as per GPH's Eurobond continues to exceed at 30 June
2020 the incurrence covenant of 5.0x with a value of 6.70x (31 December 2019: 4.65x).
· In light of the significant impact of the Covid-19 outbreak on the Group the board has elected to suspend the
dividend until the cruise industry recovers.
Covid-19 crisis management and actions
As previously disclosed on the 14 April 2020 and 10 June 2020, in light of the exceptional circumstances that have
engulfed the cruise industry, the board and management took several significant actions to protect the balance sheet and
long term future of the business.
On the 14 April 2020 the board stated that the actions taken meant that even under a severe downside scenario the Group
would have sufficient cash resources to remain in operation at the end of April 2021. This severe downside scenario
included a number of key assumptions, two of which were, an assumption of no cruise calls for the remainder of 2020 and
extending into 2021 for certain ports, and for marble container throughput volumes to fall by 75% compared to management
expectations over the period from May to September 2020.
While the board and management remain focussed on controlling costs and preserving cash, it is notable that recently some
of our cruise ports have started to plan for the first cruise calls following the Covid-19 related suspension of
activities and that marble volumes for April to June 2020 are above those achieved in Q12020 and significantly ahead of
the key assumption in the severe downside scenario.
Flexible cost base
GPH's cruise port business model is inherently flexible. Outsourced service providers are extensively used across our
cruise ports. This means that a high percentage of costs automatically expands and contracts in line with cruise traffic.
The flexibility of this model has helped protect the business and preserve cash during the Covid-19 crisis. With this
evident in a Q2 EBITDA loss of just $1.8m in Cruise, despite almost zero cruise calls in the period and underlying Cruise
revenue (i.e. excluding Nassau's IFRIC-12 revenue related to construction activity) of only $0.9m.
In addition, trading at our commercial ports has remained positive despite the macroeconomic issues arising in context of
Covid-19. Thanks to diversification of GPH's income sources a positive Adjusted EBITDA of $3.2m at the Group level in Q2
2020 was achieved.
Looking ahead, when cruise calls increase and passengers begin to return to our cruise ports, the structure of our
business model is such that the majority of the costs will rise or fall depending on the volume. This means that each
cruise call at any of our ports should have a positive impact on EBITDA.
In terms of the costs that are not directly driven by cruise calls, as cruise demand recovers, these costs will naturally
return. However, we will only allow them to rise in a meaningful way when the demand has reached levels which can be
considered sustainable. Investment related costs such as new port project expenses and capex, with the exception of capex
in Nassau and Antigua, are expected to remain low for at least the next 12 months.
New Port Capital Commitments
Since the global outbreak of Covid-19 all but essential maintenance capex has been suspended across our portfolio.
However, the capex at our new ports in the Caribbean has continued as planned.
In Antigua, the Group has contributed all required equity at closing of the transaction in October 2019. The balance of
the necessary investment, required to complete the new pier, will be fully funded through a committed bank loan from a
syndicate of lenders.
In Nassau, the construction phase has now begun, with an expected completion date of April 2022. The scheduled capex for
the marine component of the construction has been fully financed by the recent issue of a 20-year $150m 8.0% coupon bond
by Nassau Cruise Port. Further funding at Nassau Cruise Port will not be required until the second half of 2021.
While new cruise port project expenses have effectively been suspended, the board believes that despite and partly due to
Covid-19 there is still considerable scope for future expansion of the business over the medium to long term. While there
continues to be a strong appetite to finance investment in cruise port infrastructure, as evidenced by the successful
Nassau Cruise Port bond issuance, not all new port projects require up-front investment from GPH.
For example, in Spain GPH recently partnered with Balearia Group in their tender submission for a 35-year concession for
the port of Valencia. While the plans include an investment of $37m into the infrastructure, including a new
environmentally friendly passenger terminal in the port of Valencia, GPH will not be investing in the infrastructure and
will focus solely on managing the cruise port operations. The outcome of this tender is expected to be announced before
the year end.
While the Covid-19 crisis has clearly impacted the plans of many current cruise port owners or and local authorities, it
will have also impacted the plans of would-be investors in cruise ports. With a proven ability to bring global best
practice and leading health and safety protocols to ports as well as the ability to raise financing for new projects even
in the most challenging of times, Global Ports Holding is well positioned to play an active role as new opportunities
arise.
Strategic Review and Eurobond
On 11 March 2020 GPH announced that following a competitive sales process it had entered exclusive negotiations with a
potential buyer of Port Akdeniz. Negotiations continue to progress positively but a final outcome on the sale process has
not yet been reached. There can be no certainty as to the timing of the sale or that the terms of a sale will be agreed.
A further announcement will be made when it is appropriate to do so. After this process has ended the Group will decide
on the most appropriate refinancing structure for its $250m 2021 Eurobond.
The Group's $250m 2021 Eurobond has a covenant of five times Gross Debt to EBITDA for the bond issuer Global Liman, a
100% subsidiary of Global Ports Holding, and its consolidated subsidiaries. As at 30 June 2020, Gross Debt to EBITDA was
6.7x. As an incurrence covenant, the impact is that incurrence of additional debt at Global Liman and its subsidiaries
and dividend distributions from Global Liman are restricted until such time as the Gross Debt to EBITDA leverage falls
below five times.
Cruise - Significant impact from Covid-19
· Cruise EBITDA fell 76.9% (76.7% ccy) to $3.9m in the period, with Cruise Revenue, excluding the impact of IFRIC-12,
falling by 50.1% (49.7% ccy) to $11.9m.
· The onset of the global Covid-19 crisis and the suspension of nearly all global tourism, clearly hit our Cruise ports
hard in Q2. However, it is testament to the strength and flexibility of GPH's business model that despite only $0.9m of
revenue across our cruise ports in Q2 excluding Nassau's IRIC-12 revenue, our Cruise business made and EBITDA loss of
just $1.8m in Q2.
· Due to the application of IFRIC-12 for Nassau Cruise Port the capex incurred for this project is accounted for as
revenue including a gross profit margin of 2%. In Q2 2020, IFRIC-12 increased reported revenue by $22.0m. The
expenditure for the construction activities is recognised as operating expenses. IFRIC-12 has no impact on cash
generation.
· Passenger volumes fell 35.7% yoy, with just 1.3m PAX handled in the period.
· The health and safety of our staff, local communities, passengers and crew has always been our first priority. A
range of new measures, including universal testing of pre-embarkation testing of passengers, have been put in place
across our ports, meeting and often exceeding local and regional regulatory requirements.
· The World Travel and Tourism Council has already endorsed the measures taken in a number of our ports, and has so far
provided a "safe travel" stamp for Antigua, Barcelona, Bodrum, Ege Port, Malaga, Valletta, and Zadar.
· While there remains considerable uncertainty over when cruising will meaningfully start its path back to a new
normal, GPH is ready to welcome the safe return of passengers across our portfolio.
Commercial - steady underlying performance continues
· Commercial EBITDA fell 41.9% (-41.8% ccy) to $12.9m in the period, with Commercial Revenue falling 33.9% (-33.6% ccy)
to $20.3m. Excluding the previous disclosed impact of the oil services contract in H1 2019 at Port Akdeniz, Commercial
EBITDA fell 25.9% in the period.
· Despite the onset of the Covid-19 crisis towards the end of Q1, it is important to note that underlying Q2 Commercial
EBITDA was broadly stable in Q2 (-0.6% QoQ).
· General & Bulk Cargo volumes grew 27.3% yoy in H1 2020, while TEU throughput fell 13.8% yoy in H1 2020. Importantly,
despite the Covid-19 crisis, Q2 General & Bulk Cargo volumes rose 3.5% QoQ and Q2 TEU Throughput fell just 10.6% QoQ.
Outlook & current trading
Looking into the remainder of 2020, the near term outlook for Cruise remains highly uncertain. A number of cruise lines
have recently commenced sailings and more are planning to do so over the remainder of 2020. Understandably, there remains
considerable uncertainty over these sailings. All of our ports have worked hard and continue to work hard to ensure they
play their part in helping the industry set sail once again and that cruise passengers, health authorities and cruise
lines are reassured by the new health and safety measures at our ports.
Looking into 2021 and beyond, it is very encouraging to see strong booking trends across all regions. While on-board
distancing measures will mean cruise ship occupancy levels are likely to be down in 2021, the level of continued consumer
demand is encouraging. Despite these signs, no material revenue and hence no material improvement compared to Q2 2020 is
expected in the Cruise segment for the remainder of the year.
Our commercial ports have continued to show stable performance albeit not being fully immune against the major
disruptions caused by Covid-19. Over the remainder of the year, we expect our Commercial ports to improve compared to H1
2020.
Notes- For full definitions and explanations of each Alternative Performance measures in this statement please refer to
Note 2f
1) All $ refers to United States Dollar unless otherwise stated
2) Segmental EBITDA is calculated as income/(loss) before tax after adding back: interest; depreciation; amortisation;
unallocated expenses; and specific adjusting items
3) Adjusted EBITDA calculated as Segmental EBITDA less unallocated (holding company) expenses
4) Underlying Profit is calculated as profit / (loss) for the year after adding back: amortisation expense in relation
to Port Operation Rights, non-cash provisional income and expenses, non-cash foreign exchange transactions and specific
non-recurring expenses and income. Adjusted earnings per share is calculated as underlying profit divided by weighted
average number of shares
5) Adjusted earnings per share is calculated as underlying profit divided by weighted average number of shares
6) Performance at constant currency is calculated by translating foreign currency earnings from our consolidated cruise
ports, management agreements and associated ports for the current period into $ at the average exchange rates used over
the same period in the prior year.
7) Passenger numbers refer to consolidated and managed portfolio consolidation perimeter, hence it excludes equity
accounted associate ports La Goulette, Lisbon Singapore and Venice.
8) Revenue allocated to the Cruise segment is the sum of revenues of consolidated and managed portfolio
9) EBITDA allocated to the Cruise segment is the sum of EBITDA of consolidated cruise ports and pro-rata Net Profit of
equity accounted associate ports La Goulette, Lisbon, Singapore and the contribution from management agreements
10) Revenue Ex IFRIC 12 and Ex IFRIC 12 Segmental EBITDA refers to Nassau Cruise Port Revenue and EBITDA excluding the
impact of IFRIC 12.
For further information, please contact:
CONTACT
For investor, analyst and For media enquiries:
financial media enquiries:
Global Ports Holding, Investor Global Ports Holding
Relations
Martin Brown Ceylan Erzi
Telephone: +44 (0) 7947 163 687 Telephone: +90 212 244 44 40
Email: Email:
martinb@globalportsholding.com ceylane@globalportsholding.com
A copy of this report will be available on our website www.globalportsholding.com [1] today from 0700hrs (BST). Investor Call An analyst and investor call will be held today at 3.00pm (BST). Please email martinb@globalportsholding.com for dial in details Group performance review With the Covid-19 outbreak leading to an effective global shutdown of leisure travel, including the suspension of cruising in the second quarter, the first half of 2020 has proven to be the most difficult period in the company's history. Group revenue was down just 0.8% (-0.3% ccy) to $54.2m, however, this figure is heavily influenced by the impact of IFRIC-12 on the Nassau Cruise Port concession. Due to the concession agreement granting the Group the right to operate Nassau Cruise Port falling within the scope of IFRIC-12 "Service Concession Arrangements", the Group recognises revenue and operating expenditure as construction takes place to improve the port infrastructure. This revenue does not represent amounts that will be paid directly to the Group by either the local port authority or the ports customers. As a result, we have also presented analysis of the Group's results excluding this revenue and the related expense. This revenue is referred to as 'IFRIC-12' throughout the performance review. Excluding this impact Group revenue fell by 41%. Adjusted EBITDA fell 61.2% (-61.1% ccy) to $13.5m (H1 2019: $34.8m) in the period. An underlying loss of $3.5m was reported for the period, compared to an underlying profit of $6.0m for the same period last year and loss after tax of $34.9m compared to a $15.8m loss after tax for the same period last year. 2020 was the year that the strategy we set at the IPO in 2017 really started to deliver operational and financial results. Our successful expansion into the Caribbean drove a step change in our Cruise operations in Q1. Unfortunately, the subsequent Covid-19 crisis had a materially negative impact on the business, delaying but not cancelling the impact of our successful expansion in the Caribbean. In the first half of the year, cruise passenger volumes fell 35.7% to 1.3m (H1 2019: 2.1m, FY 2019: 5.3m). This is in sharp contrast to the reported growth in cruise passenger volumes in Q1 of 146% yoy, which was driven by the first time contribution from the new Caribbean cruise ports in The Bahamas and Antigua. At all ports, including equity accounted associate ports La Goulette, Lisbon, Singapore and Venice, we welcomed 1.6m passengers (H1 2019: 3.3m, FY 2019: 9.3m). Cruise Revenue in the first half increased by 41.9% to $33.9m (H1 2019: $23.9m, FY 2019: $63.0m), while Cruise EBITDA fell by 76.9% to $3.9m. However, these figures, particularly revenue, are heavily influenced by the application of accounting standard IFRIC 12 on Nassau Cruise Port concession. This increased revenue at Nassau Cruise Port by $22.0m in the period and EBITDA by $0.4m. With the global shutdown of the cruise industry in Q2, the vast majority of Cruise activity took place in Q1. Excluding IFRIC-12, H2 Cruise revenue and EBITDA was $11.9m and $3.5m respectively, reflecting the global cruise industry shutdown, Q2 Cruise revenue and EBITDA was $0.9m and $-2.2m. Most of the revenue generated in Q2 2020 was Ancillary Revenue such as rental income from retail facilities. On a constant currency basis, first half cruise revenue was $34.0m and Cruise EBITDA was $3.0m. In the context of a global crisis the underlying performance of our Commercial Port operations was positive in the period. While Commercial revenues fell by 33.6% to $20.3m in the period (H1 2019: $30.8m, FY 2019: $54.8m), excluding the impact of the oil services contract at Port Akdeniz in H1 2019, Commercial revenue fell 19.1%. While Commercial Revenue was stable in Q2, falling by just 4.6%, a strong performance in light of the prevailing crisis. Revenues from Port Akdeniz fell by 36.5% in H1 2020, while Port Adria's revenue fell by 18.7%. Port Akdeniz's revenue decline reflects the impact of the 2019 Oil services contract, excluding this impact, Port Akdeniz revenue fell 19.3%. Commercial EBITDA fell by 41.9% to $12.9m, with both ports reporting a decline. Port Akdeniz delivered a decline in EBITDA of 42.6% to $11.9m, however excluding the impact of the 2019 Oil services contract, EBITDA declined 25.9%. This better underlying performance at Port Akdeniz is reflected in the cargo volumes. In H1 2020, General & Bulk cargo volumes rose 65.7% (Q1 2020: 86.0%), while Container volumes fell -20.7% (Q1 2020: -20.3%). Port of Adria reported an EBITDA decline of 30.4% to $1.1m. General & Bulk cargo volumes fell 77.5% (Q1 2020: -64.8%), while Container volumes fell rose 7.2% (Q1 2020: -9.3%). Central costs were reduced by 22.1% in the period, reflecting the prompt action taken in Q2 to control costs and conserve cash as the Covid-19 crisis started to have a significant impact on the global cruise industry. The cost reduction program has reduced costs by about two thirds compared to Q1 2020, the full impact of which will be visible during H2 2020. Loss after tax for the period of $34.9 million (H1 2019: $15.8m) results primarily from the $21.3m fall in Adjusted EBITDA, the net finance costs increase to $23.0m (H1 2019: $18.4m) and decrease in income from equity accounted associates to $0.7m (H1 2019: $3.3m), largely offset by a tax credit of $7.1m, which compares to a tax expense of $1.9m in H1 2019. The increased net finance costs are due to non-cash loss when revaluing the Eurobond debt, along with non-cash revaluation losses on Turkish entities foreign currency dominated liabilities and the increase in net interest expenses increased to $13.9m (H1 2019: $14.3m). The tax credit reflects the impact of the loss before tax in the period. Cruise Ports Business Review As stated above, 2020 was the year that the strategy we set at the IPO was expected to start to really deliver operational and financial results. By the end of Q1, this expectation was becoming reality, with cruise passenger volumes up 146% yoy and Cruise EBITDA up 61% at the end of March 2020. Unfortunately, the global outbreak of Covid-19 and the subsequent unprecedented disruption to both global economies and the global travel sector put the cruise sector into hibernation. As of today, there have been only a few signs of cruising returning to our porst, with a small number of cruise ships now sailing very restricted itineraries. However, while there are plans for further ships to set sail over the remainder of 2020, the short term outlook remains uncertain. However, looking into 2021 and beyond, it is very encouraging to see such strong booking trends across the cruise industry and across all regions. The major cruise lines have stated that booking trends for 2021 are strong and while the industry has seen some early retirement of older ships and small delays to new ship orders, the long term outlook for the cruise ship fleet remains positive. It should come as no surprise to see our Cruise port operations so badly affected by the global shutdown in 2020. However, it is testament to our business model and our speed of response to the crisis that at the EBITDA level of our Cruise port business lost only $1.8m in Q2 2020, generating a H1 2020 EBITDA of $3.9m. Cruise Port H1 2020 H1 2020 H1 2020 YoY Growth YoY CCY Operations CCY6 (%) Growth (%) Revenue ($m) 33.9 34.0 23.9 41.9% 42.5% Ex IFRIC 12 11.9 23.9 -50.1% Cruise Revenue ($m)10 Segmental 3.9 3.9 16.8 -76.9% -76.7% EBITDA ($m) Ex IFRIC 3.5 16.8 -79.5% Segmental EBITDA ($m)10 Segmental 11.5% 11.5% 70.5% -83.7% -83.6% EBITDA Margin Passengers (m 1.3 2.0 -35.7% -35.7% PAX) Creuers (Barcelona and Malaga) Revenue ($m) 1.5 1.5 12.5 -88.1% -87.8% Segmental (0.8) (0.8) 7.7 -110.2% -110.5% EBITDA ($m) Segmental -53% -53% 62% -185.9% -185.9% EBITDA Margin Passengers (m 0.1 1.0 -86.7% -86.7% PAX) Valletta Cruise Port Revenue ($m) 1.75 1.80 6.25 -72.0% -71.3% Segmental 0.68 0.70 3.72 -81.7% -81.3% EBITDA ($m) Segmental 38.8% 38.8% 59.6% -34.9% -34.9% EBITDA Margin Passengers (m 0.04 0.39 -89.8% -89.8% PAX) Ege Port Revenue ($m) 0.47 0.47 2.30 -79.7% -79.7% Segmental (0.16) (0.16) 1.36 -111.9% -111.9% EBITDA ($m) Segmental -34.6% -34.6% 59.0% -158.6% -158.6% EBITDA Margin Passengers (m 0.01 0.06 -90.0% 190.2% PAX) Nassau Cruise Port Revenue ($m) 27.4 27.4 n/a Ex IFRIC 12 5.5 n/a Revenue ($m)10 Segmental 2.8 2.8 n/a EBITDA ($m) Ex IFRIC 12 2.3 n/a Segmental EBITDA ($m)10 Segmental 10.2% 10.2% n/a EBITDA Margin Passengers (m 0.84 n/a PAX) Other Cruise Revenue ($m) 3.6 3.7 4.5 -18.7% -16.6% Segmental 1.1 1.1 1.6 -32.0% -30.4% EBITDA ($m) Passengers (m 0.27 0.51 -46.8% -46.8% PAX) Overall in H1 2020 we welcomed 1.3m Cruise passengers, a 36% decline compared to the same period last year. With the strong first time contribution from our new ports in the Caribbean in Q1 2020 helping to offset the impact of the shutdown of the cruise industry in Q2 2020. At all ports including equity accounted associate ports La Goulette, Lisbon, Singapore and Venice we welcomed 1.6m passengers (H1 2019: 3.3m, FY 2019: 9.3m). In the first half Cruise Revenue increased 41.9% to $33.9m vs H1 2019 $23.9m and Cruise Segmental EBITDA fell 76.9% to
$3.9m (H1 2019: $16.8m). However, Cruise revenue was inflated by the accounting standard IFRIC-12, which resulted in
$22.0m of capital expenditure at Nassau Cruise Port in Q2 having to be recognised as revenue. Excluding this impact
Cruise Revenue in H1 2020 was $11.9m and Cruise Segmental EBITDA was $3.5m.
The most significant contributor to Cruise Segmental EBITDA was the first time underlying contribution of Nassau, which
reported EBITDA of $2.8m in H1 2020. Elsewhere, with almost no passenger volumes in Q2 2020, Valletta and Ege performed
better than most other ports in the period as a result of their non-passenger related retail revenue such as waterfront
restaurants.
Overall the pro-rata net income contribution from our equity accounted associate ports to Other Cruise EBITDA was $0.7m
(H1 2019: $3.3m) during the period.
With the onset of the Covid-19 outbreak, the focus of our cruise operations quickly became cost cutting and cash
preservation. GPH's business model is inherently flexible in its Cruise ports. The extensive use of outsourced serviced
providers means that a high percentage of costs automatically expand and contract in line with cruise traffic.
Fixed costs were reduced through a range of measures including a significant reduction in employee costs through a
reduced working week, salary deferrals, and suspension of board members' salaries and fees until 2021. Marketing costs,
new port project costs and consultancy fees were significantly reduced. In addition, at a number of ports minimum
concession fees have either been discounted or deferred. With the exception of the ports in Nassau and Antigua, all but
essential maintenance capital expenditure has been suspended, yielding a significant saving.
The flexibility of this model has helped protect the business and preserve cash during the Covid-19 crisis and the
reporting of $3.9m of Cruise Segmental EBITDA in H1 2020 and an EBITDA loss of just $1.8m in Q2 2020 is testament to the
flexibility and strength of the business model in the face of a never seen before crisis.
While most of our cruise ports have been very quiet in Q2 2020, in the Caribbean, work has continued in transforming
Nassau Cruise Port and Antigua Cruise Port. So far in 2020, $28.9m has been invested into Nassau Cruise Port and $9.1m
has been invested into Antigua Cruise Port.
Phase two of the Nassau Cruise Port project is now underway, this phase will involve completing the marine works, which
includes material purchases, an expansion of the berthing capacity of the port, and upgrades to existing infrastructure.
In 2021, phase three will see the completion of the landside works, including the new arrivals terminal and plaza,
Junkanoo Museum, retail Market Place, amphitheatre, and other food and beverage and entertainment spaces. The project
will also see the port integrated into Bay Street with the expectation that it will serve as a catalyst for the wider
development of downtown Nassau. Transforming not just Nassau Cruise Port into one of the iconic cruise destinations in
the world but also transforming the experience for cruise passengers, locals and the cruise lines, while generating local
jobs and driving economic growth.
In May 2020, Nassau Cruise Port successfully issued a 8.0% coupon $150m 2040 bond through a private offering. The success
of this issue, underpins the strength and attractions not only of this project but of the continued long term attractions
of the global cruise industry.
In Antigua, significant progress has been made in the period on the work to complete the new pier. Once complete the pier
will be capable of berthing the largest cruise ships in the world, acting as a key enabler of passenger volume growth
over the medium term. Completion of the new pier is targeted for Q42020.
In addition to the continued investment in the Caribbean in H1 2020, the footprint of GPH's cruise port portfolio
increased when its joint venture with MSC Cruises S.A., announced it had completed the acquisition of Goulette Shipping
Cruise, the company that operates the cruise terminal in La Goulette, Tunisia. The concession to operate the cruise port
was awarded to Goulette Shipping Cruise in 2006 on a 30-year basis, with a right to extend the term for an additional 20
years.
In addition, GPH increased its effective ownership of Malaga Cruise Port to 62% from 49.6%, when Creuers Del Port de
Barcelona SA ("Creuers") completed the purchase of Autoridad Portuaria de Malagas's (Malaga Port Authority) 20.0% holding
in the Malaga cruise port concession for &euro1.5m. This transaction is in line with GPH's strategy to buy out, at fair
value, minority shareholdings where possible and appropriate to do so.
Commercial Ports Business Review
Our Commercial ports business has proven to be resilient in the first half of 2020, despite the turmoil caused to the
global economy from the Covid-19 crisis. While our commercial ports are never immune to macro-economic factors, the
performance has nevertheless been pleasing given the prevalent conditions.
The performance from Port Akdeniz has been far stronger than the severe downside scenario outlined at the time of the
full year results on the 14 April 2020. A key element of this scenario was marble volumes at Port Akdeniz falling by 75%
between May to September 2020 when compared to management expectations. In Q2 2020 Container Throughput volumes actually
rose 1.5% QoQ, while marble volumes were up QoQ, performing significantly better than the severe downside assumption,
albeit below our original expectations at the beginning of the year.
Commercial H1 H1 2020 H1 2019 YoY Growth YoY CCY
2020 CCY6 (%) Growth (%)
Revenue ($m) 20.3 20.4 30.8 -33.9% -33.6%
Segmental 12.9 13.0 22.3 -41.9% -41.8%
EBITDA ($m)
Segmental 63.6% 63.5% 74.9%
EBITDA Margin
General & Bulk 583.0 458.0 27.3%
Cargo ('000)
Throughput 90.9 105.6 -13.8%
('000 TEU)
Yield (USD, 5.4 7.5 -27.8%
Revenue per
tonnes)
Yield (USD, 168.1 163.0 -3.0%
Revenue per
TEU)
Our Commercial port operations delivered a decline in revenue of 33.9% to $20.3m (H1 2019: $30.8m). While Commercial
EBITDA fell by 41.9% to $12.9m (H1 2019: $22.3m). Excluding the impact of the oil services contract in 2019, Commercial
revenue and EBITDA fell 19.1% and 25.9% respectively.
Overall Container Throughout volumes declined by 13.8% in H1 2020, with Q2 volumes actually delivering growth of 10.6%
QoQ, despite the onset of the Covid-19 crisis. While General & Bulk Cargo volumes were strong, rising by 27.3% in the
period. This growth was driven by the continued impact of a new volume focussed pricing structure at Port Akdeniz.
In terms of yields, total throughput container yields were down 3.0%, while cargo yields were down 27.8%. With this drop
in cargo yields primarily the result of the volume related pricing initiative at Port Akdeniz in the period.
Port Akdeniz H1 H1 2020 H1 2019 YoY Growth YoY CCY
2020 CCY6 (%) Growth (%)
Revenue ($m) 16.7 16.7 26.3 -36.5% -36.5%
Segmental 11.9 11.9 20.7 -42.6% -42.6%
EBITDA ($m)
Segmental 71.1% 78.7% 78.7%
EBITDA Margin
General & Bulk 555.4 335.3 65.7%
Cargo ('000)
Throughput 63.2 79.7 -20.7%
('000 TEU)
Yield (USD, 186.6 188.1 -0.8%
Revenue per
tonnes)
Yield (USD, 4.7 6.4 -27.3%
Revenue per
TEU)
Port Akdeniz, our largest commercial port, reported a revenue decline of 36.5% to $16.7m (H1 2019: $26.3m), with EBITDA
declining 42.6% to $11.9m (H1 2019: $20.7m), with the EBITDA margin falling to 71.1%. Excluding the impact of the oil
services contract in 2019, Port Akdeniz Revenue fell 19.3% and EBITDA fell 25.3%.
The success of the new pricing strategy led to General & Bulk Cargo volumes rising strongly, increasing by 65.7%, with
the increase in Q2 moderating from the 86.0% increase in Q1. Throughput container volumes fell by 20.7% in H1 2020, with
Q2 volumes following a similar trend to Q1. Container Throughout yields were broadly unchanged, while General & Bulk
cargo yields reduced as part of our volume based pricing strategy.
Looking into H2 2020, despite the Covid-19 crisis, we expect our Commercial ports to improve compared to H1 2020.
On 11 March 2020 GPH announced that following a competitive sales process it had entered exclusive negotiations with a
potential buyer of Port Akdeniz. Negotiations continue to progress positively but a final outcome on the sale process has
not yet been achieved. There can be no certainty as to the timing or that the terms of a sale will be agreed. A further
announcement will be made when it is appropriate to do so.
Port Adria H1 H1 2020 H1 2019 YoY Growth YoY CCY
2020 CCY6 (%) Growth (%)
Revenue ($m) 3.6 3.7 4.5 -18.7% -16.6%
Segmental 1.1 1.1 1.6 -32.0% -30.4%
EBITDA ($m)
Segmental 29.3% 29.3% 35.0%
EBITDA Margin
General & Bulk 27.6 122.7 -77.5%
Cargo ('000)
Throughput 27.7 25.9 7.2%
('000 TEU)
Yield (USD, 109.5 106.6 2.7%
Revenue per
tonnes)
Yield (USD, 17.9 9.1 96.8%
Revenue per
TEU)
At Port of Adria, Revenue fell 18.7% to $3.6m (H1 2019: $4.5m), while EBITDA fell $0.5m or 32.0% to $1.1m (H1 2019:
$1.6m). General & Bulk Cargo volumes fell 77.5% in the period, driven primarily by a sharp drop in steel coils volumes.
While Throughput container volumes rose 7.2%. We continue to work on growing the volumes at this port and remain in talks
with a number of parties, both importers and exporters about introducing new cargos at the port.
Financial Overview
Loss after tax for the period of $34.9 million (H1 2019: $15.8m) is driven by an increase in net finance costs to $23.0m
(H1 2019: $18.4m), lower contribution from equity accounted associates of $0.7m (H1 2019: $3.3m), while there was a tax
credit of $7.1m compared to a tax expense of $1.9m in H1 2019.
The increased net finance costs are primarily due to non-cash loss when revaluing the Eurobond debt, along with non-cash
revaluation losses on Turkish entities foreign currency dominated liabilities. Net interest expenses increased to $15.5m
(H1 2019: $12.7m). The tax credit reflects reflect the impact of the loss before tax in the period.
The tax credit reflects the impact of reporting an operating loss, driven by the significantly lower taxable profit
contribution from cruise operations and lower taxable profits from commercial ports.
Specific Adjusting Items in Operating Profit
As of 30 June 2020, specific adjusting items totalled $5.4m (H1 2019: $6.5m), comprising project expenses amounting to
$4.5m (H1 2019: $4.7m) which were mostly incurred in the first four months of the year, provisions $0.1m (H1 2019: $1.2m)
and other specific adjustment items $0.8m (H1 2019: $0.6m) Please see note 2 (f) in the interim condensed consolidated
financial statements for more details.
Finance Costs
The Group's net finance charge in the period was $23.9m, an increase on the $18.4m charge in H1 2019. This increase was
due to the Turkish Lira depreciation against $ in the year, which creates a foreign exchange charge and gain on
liabilities and assets respectively.
This occurs for two reasons. Firstly, the group's Eurobond is issued by Global Liman, a 100% owned entity within the
group with a functional currency of Turkish Lira. When the Turkish Lira depreciates against the $ a non-cash foreign
exchange loss occurs when revaluing the Eurobond debt, while a non-cash foreign exchange gain should occur if the Turkish
Lira appreciates against the $. Secondly, although all our Turkish ports charge in $, they must legally keep the
accounting books in Turkish Lira, so when the Turkish Lira depreciates against the $ this results in non-cash foreign
exchange losses on revaluing the Turkish entities' foreign currency denominated liabilities and non-cash foreign exchange
gains on revaluing the Turkish entities foreign currency assets.
During the period net finance expenses increased to $34.9m (H1 2019: $28.9m), primarily due to non-cash foreign exchange
loss of $17.2m (H1 2019: $13.1m), interest expenses on loans and borrowings increased slightly to $13.4m (H1 2019:
$12.7m) and interest expenses on lease obligations increased to $2.2m (H1 2019: $1.7m).
Finance income increased to $11.0m (H1 2019: $10.5m), primarily as a result in an increase in in the non-cash foreign
exchange gains on Turkish entities' Turkish Lira costs base to $16.2m (H1 2019: $16.2m).
Taxation
Global Ports Holding is a multinational group and as such is liable for taxation in multiple jurisdictions around the
world. The Group's incurred a tax credit for the period of $7.1m, compared to a tax expense of $1.9m in H1 2019.
The tax credit compared with prior years is primarily the result of reporting an operating loss in the period, driven by
the significantly lower taxable profit contribution from cruise operations and lower taxable profits from commercial
ports.
Earnings Per Share
The Group's basic earnings per share was -46.2.5c (H1 2019: -26.0c), this decrease is in line with the decline in profit
for the year attributable to owners of the company -$29.1m (H1 2019: -$16.3m). Adjusted earnings per share of -5.6c (H1
2019: 9.5c), reflects the decline in the underlying profit measure, which is calculated as (loss)/profit for the period
after removing the impact of the amortisation of port operating rights and depreciation of right of use assets, non-cash
provisional income and expenses, non-cash foreign exchange transactions and specific non-recurring expenses and income.
Cash Flow and Investment
Operating cash flow was $16.6m (H1 2019: -$1.3m). The improvement in operating cash flow was driven by a working capital
movement that resulted in a positive cash flow of $8.8m in the period, primarily as a result of the unwind in trade and
other receivables in the absence of cruise calls in Q2 2020 and following the peak cruise season in the Caribbean.
Capital expenditure during the period was $43.9m, a significant increase on the $5.7m incurred in H1 2019. $38.0m was
spent on the Caribbean ports in Antigua and Nassau. $3.4m was spent across the rest of the cruise portfolio, with $1.9m
spent in Barcelona on terminal improvements and $1.4m in Valletta on investment into the waterfront infrastructure. While
$2.5m was spent on the Commercial ports, with the vast majority spent at Port Akdeniz.
Balance Sheet
Gross debt at period end was $559.2m (31st December 2019: $410.0m), with this increase driven largely by the issuing of
the $150m Nassau Cruise Port bond in the period. At 30th June 2019 net debt was $436.9m (31st December 2019: $389.2m).
The Group's Net Debt/Adjusted EBITDA ratio was 7.8x times as at 30th June 2020 (31st December 2019: 4.3x). Excluding IFRS
16 impact net debt was $372.6m (31st December 2019: $324.3m) and the Net Debt/Adjusted EBITDA ratio was 6.7x.
The Leverage Ratio as per GPH's Eurobond was 6.7x at 30th June 2020 (31st December 2019: 4.2x), vs an incurrence covenant
of 5.0x, the leverage ratio excludes the IFRS 16 impact, in line with the bond terms.
Impact of Foreign Currency Movements
All of GPH's European and Adriatic cruise ports operate in Euros, with the majority of costs being in Euros at our
non-Turkish cruise ports. Our Commercial port, Port of Adria receives revenues in Euros and the majority of its costs are
incurred in Euros. The translation of profits from these port operating entities are not hedged and as a result, the
movement of the US dollar and Euro exchange rates directly affects the Group's reported results.
The vast majority of our revenues at our Turkish cruise ports are in US Dollars, while the majority of costs are in
Turkish Lira. Our Commercial port, Port of Antalya, receives revenues in US Dollars and c70% of its costs are incurred in
Turkish Lira. The group does not hedge this exposure as a result, the movement of the US dollar exchange rates to the
Turkish Lira directly affects the Group's reported results.
In the first half of 2019, the group was impacted by unfavourable movements against the prior year in respect of the US
Dollar against Euro and a favourable movement in respect of the US Dollar against the Turkish Lira. The details of the
foreign exchange rates used in the period can be found in Note 2 e) of the consolidated financial statements.
Dividend
On the 14 April the board announced that in light of the unprecedented level of disruption to global trade and the cruise
industry and the associated uncertainty, the Board of GPH decided that it was prudent and in the best interests of all
stakeholders to temporarily suspend the dividend for full year 2019, until the situation becomes clearer.
Clearly significant uncertainty remains and the group has experienced a significant drop in trading since the onset of
the Covid-19 crisis. It is therefore in the best interests of all stakeholders that the dividend remains suspended for at
least financial year 2020.
Global Ports Holding PLC
Interim condensed consolidated financial statements
For the six months ended 30 June 2020
Contents
Responsibility Statement 15
Primary Statements
Interim condensed consolidated statement of profit or 16 - 17
loss and other comprehensive income
Interim condensed consolidated statement of financial 18
position
Interim condensed consolidated statement of changes in 19 - 21
equity
Interim condensed consolidated cash flow statement 22
Notes to the condensed financial statements 23 - 46
Responsibility Statement
We confirm that to the best of our knowledge:
· the condensed set of financial statements has been prepared in accordance with IAS 34 Interim Financial Reporting as
adopted by the EU,
· the interim management report includes a fair review of the information required by:
a) DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being an indication of important events that have
occurred during the first six months of the financial year and their impact on the condensed set of financial
statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and
b) DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being related party transactions that have taken place
in the first six months of the current financial year and that have materially affected the financial position or
performance of the entity during that period; and any changes in the related party transactions described in the last
annual report that could do so.
By order of the Board,
Mehmet KUTMAN
Chairman
19 August 2020
(USD '000) Notes Six months Six months Year ended
ended ended
31
30 June 2020 30 June 2019 December
2019
(Unaudited) (Unaudited)
(Audited)
Revenue 6 54,194 54,609 117,884
Cost of sales (59,769) (38,593) (79,884)
Gross profit (5,575) 16,016 38,000
Other income 925 1,132 3,501
Selling and (859) (1,744) (2,109)
marketing
expenses
Administrative (8,979) (7,801) (15,505)
expenses
Other expenses (5,120) (6,315) (8,580)
Operating profit (19,608) 1,288 15,307
Finance income 7 10,997 10,526 8,082
Finance costs 7 (34,878) (28,963) (42,333)
Net finance (23,881) (18,437) (34,251)
costs
Share of profit 653 3,320 5,580
of
equity-accounted
investees
(Loss) / Profit (42,836) (13,829) (13,364)
before tax
Tax expense 7,739 (1,931) (1,855)
(Loss) / Profit (35,097) (15,760) (15,219)
for the period /
year
(Loss) / Profit
for the period /
year
attributable to:
Owners of the (29,911) (16,317) (18,558)
Company
Non-controlling (5,186) 557 3,339
interests
(35,097) (15,760) (15,219)
(USD '000) Notes Six months Six months Year ended
ended ended
31
30 June 2020 30 June 2019 December
2019
(Unaudited) (Unaudited)
(Audited)
Other
comprehensive
income
Items that will
not be
reclassified
subsequently
to profit or
loss
Remeasurement of (88) (5) (31)
defined benefit
liability
(88) (5) (31)
Items that may
be reclassified
subsequently to
profit or loss
Foreign currency 35,001 17,225 14,774
translation
differences
Cash flow hedges 67 77 335
- effective
portion of
changes in fair
value
Cash flow hedges (13) (119) (246)
- realized
amounts
transferred to
income statement
Losses on a (28,136) (18,183) (24,725)
hedge of a net
investment
6,919 (1,000) (9,862)
Other 6,831 (1,005) (9,893)
comprehensive
loss for the
year, net of
income tax
Total (28,266) (16,765) (25,112)
comprehensive
loss for the
year
Total
comprehensive
loss
attributable to:
Owners of the (23,307) (16,861) (26,757)
Company
Non-controlling (4,959) 96 1,645
interests
(28,266) (16,765) (25,112)
Basic and 12 (46.2) (26.0) (29.5)
diluted (loss) /
earnings per
share
(cents per
share)
The notes on pages 23 to 46 are an integral part of these condensed consolidated interim financial statements
Not As at As at As at
es
30 June 2020 31 30 June 2019
December
2019
(USD '000) (USD '000)
(USD '000)
(Unaudited) (Unaudited)
(Audited)
Non-current
assets
Property and 139,304 130,511 128,150
equipment
Intangible assets 435,341 424,618 374,759
Right of Use 80,252 81,123 59,658
Assets
Investment 2,127 2,139 --
property
Goodwill 13,485 13,485 13,485
Equity-accounted 27,195 26,637 26,524
investees
Due from related 14 7,338 6,811 --
parties
Other investments 3 4 12,617
Deferred tax 3,223 2,179 2,635
assets
Other non-current 4,253 4,573 4,591
assets
712,521 692,080 622,419
Current assets
Trade and other 8 17,596 31,022 42,916
receivables
Due from related 14 372 771 1,057
parties
Other investments 54 71 72
Other current 9,120 3,916 4,315
assets
Inventory 1,376 1,393 1,468
Prepaid taxes 1,937 1,846 24
Cash and cash 122,264 63,780 58,795
equivalents
152,719 102,799 108,647
Total assets 865,240 794,879 731,066
Current 10 78,950 62,691 58,295
liabilities
Loans and
borrowings
Other financial 2,098 4,536 --
liabilities
Trade and other 23,535 21,367 17,785
payables
Due to related 14 662 1,317 504
parties
Dividends payable 9 -- -- 16,821
Current tax 2,715 2,725 2,911
liabilities
Provisions 11 6,829 2,043 1,974
114,789 94,679 98,290
Non-current
liabilities
Loans and 10 480,247 390,299 351,654
borrowings
Other financial 50,287 50,394 2,088
liabilities
Derivative 15 415 485 669
financial
liabilities
Deferred tax 78,090 84,715 89,582
liabilities
Provisions 11 15,306 18,175 7,388
Employee benefits 911 869 836
625,256 544,937 452,217
Total liabilities 740,045 639,616 550,507
Net assets 125,195 155,263 180,559
Equity
Share capital 811 811 811
Legal reserves 11,806 13,144 13,038
Share based 239 239 275
payment reserves
Hedging reserves (248,112) (220,029) (213,618)
Translation 248,490 213,715 214,918
reserves
Retained earnings 32,538 61,053 75,845
Equity 45,772 68,933 91,269
attributable to
equity holders of
the Company
Non-controlling 79,423 86,330 89,290
interests
Total equity 125,195 155,263 180,559
The notes on pages 23 to 46 are an integral part of these condensed consolidated interim financial statements
(USD '000) Notes Legal Share Hedging Translation Retained Non-controlling
based reserve reserves earnings interests
payme s
nt
Share reserves reser
capit ves
al
Total Total
equity
Balance at 1 811 13,144 239 (220,02 213,715 61,053 68,93 86,330 155,26
January 2020 9) 3 3
(Audited)
Loss for the -- -- -- -- -- (29,911) (29,9 (5,186) (35,09
year 11) 7)
Other -- -- -- (28,083 34,775 (88) 6,604 227 6,831
comprehensiv )
e (loss) /
income for
the year
Total -- -- -- (28,083 34,775 (29,999) (23,3 (4,959) (28,26
comprehensiv ) 07) 6)
e (loss) /
income for
the year
Transactions
with owners
of the
Company
Transactions 4 (b) -- -- -- -- -- -- -- 142 142
with
non-controll
ing interest
Transfer to -- (1,338) -- -- -- 1,338 -- -- --
legal
reserves
Dividends 9 -- -- -- -- -- -- -- (237) (237)
Total -- (1,338) -- -- -- 1,338 -- (95) (95)
contribution
s and
distribution
s
Changes in
ownership
interest
Acquisition 4 (a) -- -- -- -- -- 146 146 (1,853) (1,707
of minority )
shareholding
Total -- -- -- -- -- 146 146 (1,853) (1,707
changes in )
ownership
interest
Total -- (1,338) -- (28,083 34,775 (28,515) (23,1 (6,907) (30,06
transactions ) 61) 8)
with owners
of the
Company
Balance at 811 11,806 239 (248,11 248,490 32,538 45,77 79,423 125,19
30 June 2020 2) 2 5
(Unaudited)
The notes on pages 23 to 46 are an integral part of these condensed consolidated interim financial statements
(USD '000) Notes Legal Share Hedging Translation Retained Non-controlling
based reserve reserves earnings interests
payme s
nt
Share reserves reser
capit ves
al
Total Total
equity
Balance at 1 811 13,030 -- (195,39 197,247 108,981 124,6 91,045 215,72
January 2019 3) 76 1
(Audited)
Adjustment -- -- -- -- -- -- -- -- --
on initial
application
of IFRS 16
(net of tax)
(*)
Adjusted 811 13,030 -- (195,39 197,247 108,981 124,6 91,045 215,72
balance at 1 3) 76 1
January 2019
Loss for the -- -- -- -- -- (16,317) (16,3 557 (15,76
year 17) 0)
Other -- -- -- (18,225 17,671 10 (544) (461) (1,005
comprehensiv ) )
e (loss) /
income for
the year
Total -- -- -- (18,225 17,671 (16,307) (16,8 96 (16,76
comprehensiv ) 61) 5)
e (loss) /
income for
the year
Transactions
with owners
of the
Company
Transactions -- -- -- -- -- -- -- -- --
with
non-controll
ing interest
Transfer to -- 8 -- -- -- (8) -- -- --
legal
reserves
Equity -- -- 275 -- -- -- 275 -- 275
settled
share-based
payment
expenses
Dividends -- -- -- -- -- (16,821) (16,8 (1,851) (18,67
21) 2)
Total -- 8 275 -- -- (16,829) (16,5 (1,851) (18,39
contribution 46) 7)
s and
distribution
s
Total -- 8 275 (18,225 17,671 (33,136) (33,4 (1,755) (35,16
transactions ) 07) 2)
with owners
of the
Company
Balance at 811 13,038 275 (213,61 214,918 75,845 91,26 89,290 180,55
30 June 2019 8) 9 9
(Unaudited)
The notes on pages 23 to 46 are an integral part of these condensed consolidated interim financial statements
(USD '000) Notes Legal Share Hedging Translation Retained Non-controlling Total
based reserve reserves earnings interests
payme s
nt
Share reserves reser equity
capit ves
al
Total
Balance at 1 811 13,030 -- (195,39 197,247 108,981 124,6 91,045 215,72
January 2019 3) 76 1
Adjustment -- -- -- -- -- -- -- -- --
on initial
application
of IFRS 16
(net of tax)
(*)
Adjusted 811 13,030 -- (195,39 197,247 108,981 124,6 91,045 215,72
balance at 1 3) 76 1
January 2019
(Loss) / -- -- -- -- -- (18,558) (18,5 3,339 (15,21
income for 58) 9)
the year
Other -- -- -- (24,636 16,468 (31) (8,19 (1,694) (9,893
comprehensiv ) 9) )
e (loss) /
income for
the year
Total -- -- -- (24,636 16,468 (18,589) (26,7 1,645 (25,11
comprehensiv ) 57) 2)
e (loss) /
income for
the year
Transactions
with owners
of the
Company
Transactions -- -- -- -- -- -- -- 6 6
with
non-controll
ing interest
Transfer to -- 114 -- -- -- (114) -- -- --
legal
reserves
Equity -- -- 239 -- -- -- 239 -- 239
settled
share-based
payment
expenses
Dividends 9 -- -- -- -- -- (29,225) (29,2 (6,366) (35,59
25) 1)
Total -- 114 239 -- -- (29,339) (28,9 (6,360) (35,34
contribution 86) 6)
s and
distribution
s
Total -- 114 239 (24,636 16,468 (47,928) (55,7 (4,715) (60,45
transactions ) 43) 8)
with owners
of the
Company
Balance at 811 13,144 239 (220,02 213,715 61,053 68,93 86,330 155,26
31 December 9) 3 3
2019
(*) The Group has initially applied IFRS 16 at 1 January 2019, using the modified retrospective approach. Under this
approach, comparative information is not restated and the cumulative effect of initially applying IFRS 16 (if any) is
recognized in retained earnings at the date of initial application.
The notes on pages 23 to 46 are an integral part of these condensed consolidated interim financial statements
Notes Six months Six months Year
ended 30 ended 30 ended 31
June 2020 June 2019 December
2019
(USD '000) (USD '000)
(USD
'000)
(Unaudited) (Unaudited)
(Audited)
Cash flows from
operating
activities
Loss for the (35,097) (15,760) (15,219)
period / year
Adjustments
for:
Depreciation of 27,043 23,302 47,737
PPE and RoU
assets and
amortization
expense
Share of profit (653) (3,320) (5,580)
of
equity-accounte
d investees,
net of tax
Gain on -- (17) (17)
disposal of
property plant
and equipment
Finance costs 7 16,511 15,016 30,571
(excluding
foreign
exchange
differences)
Finance income 7 (82) (871) (2,017)
(excluding
foreign
exchange
differences)
Foreign 7 7,452 4,294 5,697
exchange
differences on
finance costs
and income, net
Income tax (7,738) 1,931 1,855
expense
Employment 107 72 139
termination
indemnity
reserve
Equity settled -- 275 239
share-based
payment
expenses
(Charges to) / 239 1,316 1,676
reversal of
provision
Operating cash 7,782 26,238 65,081
flow before
changes in
operating
assets and
liabilities
Changes in:
- trade and 13,426 (22,917) (11,023)
other
receivables
- other current (5,276) 426 (1,003)
assets
- related party (231) (30) (6,555)
receivables
- other 320 128 346
non-current
assets
- trade and (508) (79) (11,849)
other payables
- related party (552) (38) 775
payables
- provisions 1,614 (1,821) (31)
Post-employment (1) (21) 8,573
benefits paid
Cash generated by operations 16,574 27,213 1,886
before benefit and tax
payments
Income taxes (253) (3,137) (7,195)
paid
Net cash 16,321 (1,251) 37,119
generated from
operating
activities
Investing
activities
Acquisition of (14,811) (5,589) (15,813)
property and
equipment
Acquisition of (29,121) (69) (8,155)
intangible
assets
Acquisition of -- -- (21,000)
a lease asset
Proceeds from -- 22 35
sale of
property and
equipment
Bond and -- -- --
short-term
investment
income
Bank interest 82 140 251
received
Dividends from -- 2,849 2,849
equity
accounted
investees
Proceeds from -- -- 13,184
sale of other
investments in
FVTPL
instruments
Investment in -- -- (61)
equity
accounted
investee
Acquisition / 4 (a) (1,707) -- (5)
Incorporation
of subsidiary
Other -- -- --
investment in
FVTPL
instruments
Advances given -- (172) (292)
for tangible
assets
Net cash used (45,557) (2,819) (29,007)
in investing
activities
Financing
activities
Equity 4 (b) 142 -- 7
injection by
minorities to
subsidiaries
Dividends paid 9 -- -- (29,225)
to equity
owners
Dividends paid 9 (237) (538) (5,062)
to NCIs
Interest paid (14,779) (12,574) (26,388)
Proceeds from 130,683 19,250 74,918
borrowings
Repayments of (24,081) (13,224) (31,949)
borrowings
Repayments of (1,843) (2,433) (3,066)
lese
liabilities
(2018: payment
of finance
lease
liabilities)
Net cash used 89,885 (9,519) (20,765)
in financing
activities
Net (decrease) 60,649 (13,589) (12,653)
/ increase in
cash and cash
equivalents
Effect of (2,165) (7,445) (3,396)
foreign
exchange rate
changes on cash
and cash
equivalents
Cash and cash 63,780 79,829 79,829
equivalents at
beginning of
year
Cash and cash 122,264 58,795 63,780
equivalents at
end of year
The notes on pages 23 to 46 are an integral part of these condensed consolidated interim financial statements
1) General information
Global Ports Holding PLC is a public limited company listed on the London Stock Exchange, and incorporated in the United
Kingdom and registered in England and Wales under the Companies Act 2006. The address of the registered office is 34
Brook Street 3rd Floor, London, England, W1K 5DN, United Kingdom. Global Ports Holding PLC is the ultimate holding
company of Global Liman Isletmeleri A.S. and its subsidiaries (the "Group").
These unaudited condensed interim consolidated financial statements of Global Ports Holding PLC (the "Company", and
together with its subsidiaries, the "Group") for the six months ended 30 June 2020 were authorised for issue in
accordance with a resolution of the directors on 19 August 2019.
2) Accounting policies
a) Basis of preparation
This condensed set of consolidated financial statements included in this half-yearly financial report has been prepared
in accordance with the International Accounting Standard 34 'Interim Financial Reporting', as adopted by the European
Union and the requirements of the Disclosure and Transparency Rules ("DTR") of the FCA in the United Kingdom as
applicable to interim financial reporting.
The interim condensed financial statements represent a 'condensed set of financial statements' as referred to in the DTR
issued by the FCA. The interim condensed consolidated financial statements do not include all the information and
disclosures required in the annual financial statements and should be read in conjunction with the consolidated financial
statements as at and for the year ended 31 December 2019 available on the Company website. Also, selected explanatory
notes are included to explain events and transactions that are significant to an understanding of the changes in the
Group's financial position and performance since the last annual financial statements.
The financial information contained in this report for the six months ended 30 June 2019 and 30 June 2020 is unaudited.
These interim financial statements were authorised for issue by the Company's board of directors on 19 August 2020.
The comparative figures for the financial year ended 31 December 2019 are not the company's statutory accounts for that
financial year. Those accounts have been reported on by the company's auditor and delivered to the registrar of
companies. The report of the auditor was (i) unqualified, (ii) did not include a reference to any matters to which the
auditor drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under
section 498 (2) or (3) of the Companies Act 2006.
b) Going concern
The Group operates 14 ports in 8 different countries and is focusing on increasing its number of Ports in different
geographical locations to support its operations and diversify economic and political risks. As a consequence, the
directors believe that the Group is well placed to manage its business risks successfully despite the current uncertain
economic outlook.
Management has produced forecasts that have stress tested to reflect plausible but, highly unlikely, severe downside
scenario as a result of the COVID-19 pandemic and its impact on the global economy, which have been reviewed by the
directors at the beginning of the financial year. The management analysis, inclusive of the downside scenario, reflects
that the Group has adequate resources to continue to operate for the foreseeable future. The details of downside scenario
was provided at the last annual consolidated financial statements as at and for the year ended 31 December 2019. The
Group's performance for the first half of the year showed the Group is performing better than the downside scenario
produced at the year end.
The directors believe that the Group is well placed to manage its financing and other business risks satisfactorily, and
have a reasonable expectation that the Group will have adequate resources to continue in operation for at least 12 months
from the signing date of these consolidated financial statements. They therefore consider it appropriate to adopt the
going concern basis of accounting in preparing the financial statements.
The adoption of IFRS 16 does not impact the ability of the Group to comply with its Gross debt to EBITDA covenant.
2 Accounting Policies (continued)
c) Critical accounting judgements and key sources of estimation uncertainty
In the application of the Group's accounting policies, the directors are required to make judgements, estimates and
assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The
estimates and associated assumptions are based on historical experience and other factors that are considered to be
relevant. Actual results may differ from these estimates.
In preparing these condensed consolidated interim financial information, the significant judgments made by management in
applying the Group's accounting policies and the key sources of estimation uncertainty, except as described below, were
the same as those that applied to the consolidated financial statements as at and for the year ended 31 December 2019.
Impairment review of cash generating units (CGUs)
IFRS requires management to perform impairment tests annually for goodwill and, for finite lived assets, if events or
changes in circumstances indicate that their carrying amounts may not be recoverable.
Impairment testing requires management to judge whether the carrying value of Assets and the associated goodwill of CGU
can be supported by the net present value of future cash flows it generates. Calculating the net present value of the
future cash flows requires estimates to be made in respect of highly uncertain matters including management's
expectations of:
- Operational growth expectations including the forecast number of calls, passengers and container volumes,
- appropriate discount rates to reflect the risks involved
Management prepares formal forecast for Ege Liman, Bodrum Liman, Creuers, Malaga Port, VCP, Port of Adria and Ortadogu
Liman operations for the remaining concession period, which are used to estimate their value in use. VIU calculations
requires subjective judgements based on a wide range of variables at a point in time including future passenger numbers
or commercial volumes. Any significant decrease in variables used for value in use calculation is assessed as an
impairment indicator. If the recoverable amount of an investment is estimated to be less than its carrying amount, the
carrying amount of the investment is reduced to its recoverable amount and an impairment loss is recognised in the income
statement.
Management forecasted a recovery in following two years for number of passengers, and the cash flows for following seven
years with the remaining concession term having minimal estimated growth or industry growth. The key assumptions used in
the estimation of the recoverable amount are set out below.
2019
Average pre-tax discount rate used 8.5%
Average annualized growth, year 3 - year 7 "Passengers" 14.3%
Average annualized growth, first 7 years "Container" 6.1%
The resulting ViU of each CGU gives a recoverable amount higher than the carrying value of Asset and associated goodwill
of CGU.
Changing the assumptions selected by management, in particular the discount rate and growth rate assumptions used in the
cash flow projections, could significantly affect the Group's impairment evaluation and hence reported assets and profits
or losses.
d) Change in / new accounting policies
The accounting policies applied in these interim financial statements are the same as those applied in the Group's
consolidated financial statements as at and for the year ended 31 December 2019. The changes in accounting policies are
also expected to be reflected in the Group's consolidated financial statements as at and for the year ending 31 December
2020.
2 Accounting Policies (continued)
e) Foreign currency
Transactions in foreign currencies are translated into the respective functional currencies of the Group entities by
using the exchange rate at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies
at the reporting date are retranslated to the functional currency at the exchange rate at the reporting date.
Non-monetary assets and liabilities denominated in foreign currencies carried at historical cost should be retranslated
using the exchange rate at the date of the transaction. Foreign currency differences arising on retranslation are
recognised in profit or loss.
The Group entities use United Stated Dollars ("USD"), Euro or Turkish Lira ("TL") as their functional currencies since
these currencies represent the primary economic environment in which they operate. These currencies are used to a
significant extent in, or have a significant impact on, the operations of the related Group entities and reflect the
economic substance of the underlying events and circumstances relevant to these entities. Transactions and balances not
already measured in the functional currency have been re-measured to the related functional currencies in accordance with
the relevant provisions of IAS 21 The Effect of Changes in Foreign Exchange Rates.
For the purpose of the interim condensed consolidated financial statements, US Dollars has been chosen as the
presentation currency by management to facilitate the investors' ability to evaluate the Group's performance and
financial position in relation to similar companies domiciled in different jurisdictions, and to eliminate the
depreciating effect of TL against hard currencies, considering all subsidiaries of the Company are earning revenues in
hard currencies.
Assets and liabilities of those Group entities with a different functional currency than the presentation currency of the
Group are translated into the presentation currency of the Group at the rate of exchange ruling at the reporting date.
The income and expenses of the Group entities are translated into the presentation currency at the average exchange rates
for the period. Equity items, except for net income, are translated using their historical costs. These foreign currency
differences are recognised in "other comprehensive income" ("OCI"), within equity under "translation reserves".
Below are the foreign exchange rates used by the Group for the periods shown.
As at 30 June 2020, 31 December 2019 and 30 June 2019, foreign currency exchange rates of the Central Bank of the Turkish
Republic were as follows:
30 June 2020 31 December 2019 30 June 2019
TL/USD 0.1462 0.1683 0.1738
Euro/USD 1.1266 1.1196 1.1382
For the six months ended 30 June 2020, 30 June 2019 and for the year ended 31 December 2019, average foreign currency
exchange rates of the Central Bank of the Turkish Republic were as follows:
Six months ended Six months ended Year ended 31
30 June 2020 30 June 2019 December 2019
TL/USD 0.1548 0.1783 0.1763
Euro/USD 1.1023 1.1297 1.1194
2 Accounting Policies (continued)
f) Alternative performance measures
This interim condensed set of financial statements includes certain measures to assess the financial performance of the
Group's business that are termed "non-IFRS measures" because they exclude amounts that are included in, or include
amounts that are excluded from, the most directly comparable measure calculated and presented in accordance with IFRS, or
are calculated using financial measures that are not calculated in accordance with IFRS. In order to account for the
impact of IFRS 16, which is applied in the Group financials using the modified retrospective approach, comparative
information is not restated, and the impact has been presented as a separate reconciling item on computations. These
non-GAAP measures comprise the following.
Segmental EBITDA
Segmental EBITDA calculated as income/(loss) before tax after adding back: interest; depreciation; amortisation;
unallocated expenses; and specific adjusting items.
Management evaluates segmental performance based on Segmental EBITDA. This is done to reflect the fact that there is a
variety of financing structures in place both at a port and Group-level, and the nature of the port operating right
intangible assets vary by port depending on which concessions were acquired versus awarded, and which fall to be treated
under IFRIC 12. As such, management considers monitoring performance in this way, using Segmental EBITDA, gives a more
comparable basis for profitability between the portfolio of ports and a metric closer to net cash generation. Excluding
project costs for acquisitions and one-off transactions such as unallocated expenses, gives a more comparable
year-on-year measure of port-level trading performance.
Management uses Segmental EBITDA to evaluate each port and group-level performances on operational level.
Specific adjusting items
The Group presents specific adjusting items separately. For proper evaluation of individual ports financial performance
and consolidated financial statements, Management considers disclosing specific adjusting items separately because of
their size and nature. These expenses and income include project expenses; being the costs of specific M&A activities and
the costs associated with appraising and securing new and potential future port agreements which should not be considered
when assessing the underlying trading performance, the replacement provisions, being provision created for replacement of
fixed assets which does not include regular maintenance, employee termination expenses, income from insurance repayments,
income from scrap sales, gain/loss on sale of securities, other provision expenses, redundancy expenses and donations and
grants.
Specific adjusting items comprised as following,
Six months ended Six months ended Year ended
30 June 2020 30 June 2019 31 December
2019
(USD '000) (USD '000)
(USD '000)
(Unaudited) (Unaudited)
(Audited)
Project 4,467 4,683 5,146
expenses
Employee 150 419 215
termination
expenses
Replacement 470 256 673
provisions
Provisions / 120 997 1,569
(reversal of
provisions)
Other 195 510 788
expenses
Specific 5,402 6,865 8,391
adjusting
items
2 Accounting Policies (continued)
f) Alternative performance measures (continued)
Adjusted EBITDA
Adjusted EBITDA calculated as Segmental EBITDA less unallocated (holding company) expenses.
Management uses an Adjusted EBITDA measure to evaluate Group's consolidated performance on an "as-is" basis with respect
to the existing portfolio of ports. Notably excluded from Adjusted EBITDA, the costs of specific M&A activities and the
costs associated with appraising and securing new and potential future port agreements. M&A and project development are
key elements of the Group's strategy in the Cruise segment. Project lead times and upfront expenses for projects can be
significant, however these expenses (as well as expenses related to raising financing such as acquisition financing) do
not relate to the current portfolio of ports but to future EBITDA potential. Accordingly, these expenses would distort
Adjusted EBITDA which management is using to monitor the existing portfolio's performance.
A full reconciliation for Segmental EBITDA and Adjusted EBITDA to profit before tax is provided in the Segment Reporting
Note 3 to these financial statements.
Underlying Profit
Management uses this measure to evaluate the profitability of the Group normalised to exclude the specific non-recurring
expenses and income, and adjusted for the non-cash port intangibles amortisation charge, giving a measure closer to
actual net cash generation, which the directors' consider a key benchmark in making the dividend decision. Underlying
Profit is also consistent with Consolidated Net Income (CNI), as defined in the Group's 2021 Eurobond, which is monitored
to ensure covenant compliance.
Underlying Profit is calculated as profit/(loss) for the year after adding back: amortization expense in relation to Port
Operation Rights, depreciation expense in relation to Right-of-use assets and specific non-recurring expenses and income.
Adjusted earnings per share
Adjusted earnings per share is calculated as underlying profit divided by weighted average per share.
Management uses these measures to evaluate the profitability of the Group normalised to exclude the specific
non-recurring expenses and income and adjusted for the non-cash port intangibles amortisation charge, giving a measure
closer to actual net cash generation, which the directors' consider a key benchmark in making the dividend decision.
Underlying profit and adjusted earnings per share computed as following;
Six months ended Six months ended Year ended
30 June 2020 30 June 2019 31
December
2019
(USD '000) (USD '000)
(USD '000)
(Unaudited) (Unaudited)
(Audited)
(Loss) / (35,097) (15,760) (15,219)
Profit for
the Period
Amortisation 21,038 16,868 34,453
of port
operating
rights / RoU
asset /
Investment
Property
Gain on -- (52) --
reversal of
provisions
Non-cash 739 174 2,457
provisional
(income) /
expenses
Unhedged 6,436 3,841 5,222
portion of
Investment
hedging on
Global Liman
(Gain) / loss 3,376 893 414
on foreign
currency
translation
on equity
Underlying (3,508) 5,964 27,327
Profit
Weighted 62,826,963 62,826,963 62,826,963
average
number of
shares
Adjusted (5.6) 9.5 43.5
earnings per
share (pence)
2 Accounting Policies (continued)
f) Alternative performance measures (continued)
Net debt
Net debt comprises total borrowings (bank loans, Eurobond and finance leases net of accrued tax) less cash, cash
equivalents and short-term investments.
Management includes short term investments into the definition of Net Debt, because these short-term investments are
comprised of marketable securities which can be quickly converted into cash.
Net debt comprised as following;
Six months ended Six months ended Year ended
30 June 2020 30 June 2019 31 December
2019
(USD '000) (USD '000)
(USD '000)
(Unaudited) (Unaudited)
(Audited)
Current loans 78,950 58,295 62,691
and
borrowings
Non-current 480,247 351,654 390,299
loans and
borrowings
Lease (64,328) (60,945) (64,828)
liabilities
recognized
due to IFRS
16
application
Gross debt 494,869 349,004 388,162
Cash and bank (122,264) (58,795) (63,780)
balances
Short term (54) (72) (71)
financial
investments
Net debt 372,551 290,137 324,311
Equity 125,195 180,559 155,263
Net debt to 2.98 1.61 2.09
Equity ratio
Leverage ratio
Leverage ratio is used by management to monitor available credit capacity of the Group.
Leverage ratio is computed by dividing gross debt to Adjusted EBITDA.
Leverage ratio computation is made as follows;
Six months ended Six months ended Year ended
30 June 2020 30 June 2019 31 December
2019
(USD '000) (USD '000)
(USD '000)
(Unaudited) (Unaudited)
(Audited)
Gross debt 559,198 409,949 452,990
Lease (64,329) (60,945) (64,828)
liabilities
recognised
due to IFRS
16
application
Gross debt, 494,869 349,004 388,162
net of IFRS
16 impact
Adjusted 55,706 82,445 73,811
EBITDA
(annualized
)
Leverage 8.88x 4.23x 5.26x
ratio
CAPEX
CAPEX represents the recurring level of capital expenditure required by the Group excluding M&A related capital
expenditure.
CAPEX computed as 'Acquisition of property and equipment' and 'Acquisition of intangible assets' per the cash flow
statement.
Six months ended Six months ended Year ended
30 June 2020 30 June 2019 31 December
2019
(USD '000) (USD '000)
(USD '000)
(Unaudited) (Unaudited)
(Audited)
Acquisition 14,811 5,589 15,813
of property
and equipment
Acquisition 29,121 69 8,155
of intangible
assets
CAPEX 43,932 5,658 23,968
2 Accounting Policies (continued)
f) Alternative performance measures (continued)
Cash conversion ratio
Cash conversion ratio represents a measure of cash generation after taking account of on-going capital expenditure
required to maintain the existing portfolio of ports.
It is computed as Adjusted EBITDA less CAPEX divided by Adjusted EBITDA.
Six months ended Six months ended Year ended
30 June 2020 30 June 2019 31 December
2019
(USD '000) (USD '000)
(USD '000)
(Unaudited) (Unaudited)
(Audited)
Adjusted 55,706 82,445 73,811
EBITDA
(annualized
)
CAPEX (43,932) (5,658) (23,968)
Cash 11,774 76,787 49,843
converted
after CAPEX
Cash 21.1% 93.1% 67.5%
conversion
ratio
Hard currency
Management uses the term hard currency to refer to those currencies that historically have been less susceptible to
exchange rate volatility. For the period ended 30 June 2020 and 2019, and for the year ended 31 December 2019, the
relevant hard currencies for the Group are US Dollar, Euro and Singaporean Dollar.
3) Segment reporting
a) Products and services from which reportable segments derive their revenues
The Group operates various cruise and commercial ports and all revenue is generated from external customers such as
cruise liners, ferries, yachts, individual passengers, container ships and bulk and general cargo ships.
b) Reportable segments
Operating segments are defined as components of an enterprise for which discrete financial information is available, that
is evaluated regularly by the chief operating decision-maker, in deciding how to allocate resources and assessing
performance.
The Group has identified ports in each country with same operations as an operating segment, separately, as each country
represents a set of activities which generates revenue and the financial information of ports are reviewed by the Group's
chief operating decision-maker in deciding how to allocate resources and assess performance. The Group's chief operating
decision-maker is the Chief Executive Officer ("CEO"), who reviews the management reports of each port at least on a
monthly basis.
The CEO evaluates segmental performance on the basis of earnings before interest, tax, depreciation and amortisation
("EBITDA") excluding the effects of specific adjusting income and expenses comprising project expenses, bargain purchase
gains and reserves, board member leaving fees, employee termination payments, unallocated expenses, finance income,
finance costs, and including the share of equity-accounted investees which is fully integrated into the GPH cruise port
network ("Adjusted EBITDA" or "Segmental EBITDA"). Adjusted EBITDA is considered by Group management to be the most
appropriate profit measure for the review of the segment operations because it excludes items which the Company does not
consider to represent the operating cash flows generated by underlying business performance. The share of
equity-accounted investees has been included as it is considered to represent operating cash flows generated by the
Group's operations that are structured in this manner.
3 Segment reporting (continued)
b) Reportable segments (continued)
The Group has the following operating segments under IFRS 8:
· BPI ("Creuers" or "Creuers (Barcelona and Málaga)"), VCP ("Valetta Cruise Port"), Ege Liman ("Ege Ports-Kusadasi"),
Bodrum Liman ("Bodrum Cruise Port"), Ortadogu Liman (Cruise port operations), POH, Nassau Cruise Port ("NCP"), Antigua
Cruise Port ("GPH Antigua"), Lisbon Cruise Terminals, SATS - Creuers Cruise Services Pte. Ltd. ("Singapore Port"),
Venezia Investimenti Srl. ("Venice Investment" or "Venice Cruise Port") and La Spezia Cruise Facility Srl. ("La
Spezia") which fall under the Group's cruise port operations.
· Ortadogu Liman (Commercial port operations) ("Port Akdeniz-Antalya") and Port of Adria ("Port of Adria-Bar") which
both fall under the Group's commercial port operations.
The Group's reportable segments under IFRS 8 are BPI, VCP, Ege Liman, Nassau Cruise Port, Ortadogu Liman (Commercial port
operations) and Port of Adria (Commercial port operations).
Bodrum Cruise Port, Italian Ports, Ortadogu Liman (Cruise operations), Port of Adria (Cruise Operations), and GPH
Antigua, [that just started its operations at the end of 2019] are not exceeding the quantitative threshold, have been
included in Other Cruise Ports.
Global Depolama does not generate any revenues and therefore is presented as unallocated to reconcile to the consolidated
financial statements results.
Assets, revenue and expenses directly attributable to segments are reported under each reportable segment.
Any items which are not attributable to segments have been disclosed as unallocated.
3 Segment reporting (continued)
b) Reportable segments (continued)
i) Segment revenues, results and reconciliation to profit before tax
The following is an analysis of the Group's revenue, results and reconciliation to profit before tax by reportable
segment:
BPI VCP Ege Nassau Other Total Ortadogu Port Total Total
Liman Cruise Cruis Cruis Liman of Comme Conso
Port e e Adri rcial lidat
Ports a ed
USD '000
Six months
ended 30 June
2020
(Unaudited)
Revenue 1,490 1,7 467 27,416 2,733 33,85 16,696 3,64 20,33 54,19
52 8 0 6 4
Segmental (790) 679 (162) 2,787 1,377 3,891 11,871 1,06 12,93 16,82
EBITDA 5 6 7
Unallocated (3,33
expenses 7)
Adjusted 13,49
EBITDA 0
Reconciliation
to profit
before tax
Depreciation (27,0
and 43)
amortisation
expenses
Specific (5,40
adjusting 2)
items*
Finance income 10,99
7
Finance costs (34,8
78)
(Loss) / (42,8
profit before 36)
income tax
Six months
ended 30 June
2019
(Unaudited)
Revenue 12,50 6,2 2,299 -- 2,809 23,85 26,277 4,47 30,75 54,60
0 49 7 5 2 9
Segmental 7,719 3,7 1,358 -- 4,027 16,82 20,690 1,56 22,25 39,08
EBITDA 21 5 8 8 3
Unallocated (4,28
expenses 3)
Adjusted 34,80
EBITDA 0
Reconciliation
to profit
before tax
Depreciation (23,3
and 02)
amortisation
expenses
Specific (6,89
adjusting 0)
items*
Finance income 10,52
6
Finance costs (28,9
63)
(Loss) / (13,8
profit before 29)
income tax
Year ended 31
December 2019
(Audited)
Revenue 31,27 13, 6,549 2,492 8,855 63,04 47,486 7,35 54,83 117,8
8 872 6 2 8 84
Segmental 20,46 8,0 4,590 1,808 9,478 44,36 37,369 1,70 39,07 83,44
EBITDA 1 27 4 8 7 1
Unallocated (6,42
expenses 6)
Adjusted 77,01
EBITDA 5
Reconciliation
to profit
before tax
Depreciation (47,7
and 37)
amortisation
expenses
Specific (8,39
adjusting 1)
items*
Finance income 8,082
Finance costs (42,3
33)
(Loss) / (13,3
profit before 64)
income tax
* Please refer to Note 2 (f) for alternative performance measures (APM) on pages 16 to 19.
3 Segment reporting (continued)
b) Reportable segments (continued)
The Group did not have inter-segment revenues in any of the periods shown above.
ii) Segment assets and liabilities
The following is an analysis of the Group's assets and liabilities by reportable segment:
BPI VCP Ege Nassau Other Total Ortadogu Port Total Total
Lim Cruise Cruis Cruis Liman of Comme Conso
an Port e e Adri rcial lidat
Ports a ed
USD '000
30 June 2020
(Unaudited)
Segment assets 140 117 43, 185,34 50,98 538,2 215,858 70,4 286,2 824,5
,80 ,68 475 5 1 94 32 90 84
4 9
Equity-accounted 27,19
investees 5
Unallocated 13,56
assets 3
Total assets 865,3
42
Segment 65, 61, 9,4 187,57 48,91 372,6 64,021 37,0 101,0 473,7
liabilities 283 445 72 5 5 90 60 81 71
Unallocated 266,3
liabilities 78
Total 740,1
liabilities 49
31 December 2019
(Audited)
Segment assets 151 117 46, 79,794 44,99 440,4 231,789 72,8 304,6 745,0
,93 ,43 283 4 43 44 33 76
8 4
Equity-accounted -- -- -- -- 26,63 26,63 -- -- -- 26,63
investees 7 7 7
Unallocated 23,16
assets 6
Total assets 794,8
79
Segment 68, 60, 9,9 79,583 41,93 260,4 72,367 38,4 110,8 371,2
liabilities 591 430 18 0 52 74 41 93
Unallocated 268,3
liabilities 23
Total 639,6
liabilities 16
30 June 2019
(Unaudited)
Segment assets 162 129 45, -- 15,96 353,5 227,440 75,4 302,8 656,4
,78 ,14 691 3 92 02 42 34
9 9
Equity-accounted -- -- -- -- 26,52 26,52 -- -- -- 26,52
investees 4 4 4
Unallocated 48,10
assets 8
Total assets 731,0
66
Segment 74, 71, 11, -- 12,18 169,0 59,312 38,7 98,10 267,1
liabilities 241 014 573 6 14 88 0 14
Unallocated 283,3
liabilities 93
Total 550,5
liabilities 07
3 Segment reporting (continued)
b) Reportable segments (continued)
iii) Other segment information
The following table details other segment information:
BPI VCP Ege Nassau Other Total Ortadogu Port Total Unallocated Total
Lim Cruise Cruis Cruis Liman of Comme Conso
an Port e e Adri rcial lidat
Ports a ed
USD '000
Six months
ended 30
June 2020
(Unaudited)
Depreciation (5, (1, (1, (3,962 (1,74 (14,3 (10,932) (1,5 (12,5 (162) (27,0
and 785 452 410 ) 5) 53) 96) 28) 43)
amortisation ) ) )
expenses
Additions to
non-current
assets
- Capital 1,8 1,4 61 28,848 9,204 41,39 2,474 44 2,518 16 43,93
expenditures 85 01 8 2
Total 1,8 1,4 61 28,848 9,204 41,39 2,474 44 2,518 16 43,93
additions to 85 01 8 2
non-current
assets
Six months
ended 30
June 2019
(Unaudited)
Depreciation (5, (1, (1, -- (1,74 (10,6 (10,882) (1,6 (12,4 (154) (23,3
and 873 613 427 6) 59) 07) 89) 02)
amortisation ) ) )
expenses
Additions to
non-current
assets
- Capital 948 826 36 -- 102 1,912 2,608 1,10 3,717 29 5,658
expenditures 9
Total 948 826 36 -- 102 1,912 2,608 1,10 3,717 29 5,658
additions to 9
non-current
assets
Year ended
31 December
2019
(Audited)
Depreciation (11 (3, (2, (1,027 (3,70 (22,3 (21,832) (3,1 (24,9 (377) (47,7
and ,69 102 857 ) 5) 87) 41) 73) 37)
amortisation 6) ) )
expenses
Additions to
non-current
assets
- Capital 1,5 1,6 46 7,850 7,903 18,98 3,311 1,59 4,907 76 23,96
expenditures 71 15 5 6 8
Total 1,5 1,6 46 7,850 7,903 18,98 3,311 1,59 4,907 76 23,96
additions to 71 15 5 6 8
non-current
assets
3 Segment reporting (continued)
b) Reportable segments (continued)
4) (iv) Geographical information
5)
6) The Port operations of the Group are managed on a worldwide basis, but operational ports and management offices are
primarily in Turkey, Montenegro, Malta, Spain, Bahamas, Antigua & Barbuda and Italy. The geographic information below
analyses the Group's revenue and non-current assets by countries. In presenting the following information, segment
revenue has been based on the geographic location of port operations and segment non-current assets were based on the
geographic location of the assets.
Revenue Six months ended Six months ended Year ended
30 June 2020 30 June 2019 31 December
2019
(USD '000) (USD '000)
(USD '000)
(Unaudited) (Unaudited)
(Audited)
Turkey 17,334 29,860 57,021
Bahamas 27,416 -- 2,492
Montenegro 3,640 4,475 7,380
Antigua & 2,431 -- 1,753
Barbuda
Malta 1,752 6,249 13,872
Spain 1,490 12,500 31,278
Italy 7 1,514 3,838
Croatia 124 11 250
54,193 54,609 117,884
Non-current assets As at As at As at
30 June 2020 31 December 2019 30 June 2019
(USD '000) (USD '000) (USD '000)
(Unaudited) (Audited) (Unaudited)
UK 7,889 7,474 13,363
Turkey 211,812 222,615 234,027
Spain 125,913 129,114 136,591
Malta 116,122 115,467 127,308
Montenegro 68,918 70,080 72,512
Bahamas 94,077 69,213 --
Antigua & Barbuda 49,032 40,494 --
Italy 5,500 5,863 6,412
Croatia 2,840 2,944 3,063
Unallocated 30,418 28,816 29,143
712,521 692,080 622,419
Non-current assets relating to deferred tax assets and financial instruments (including equity-accounted investees) are
presented as unallocated.
1) (v) Information about major customersThe Group did not have a single customer that accounted for more than 10% of
the Group's consolidated net revenues in any of the periods presented.
4) Transactions with owners of the company
a) Changes in ownership interest
The Group has acquired minority shares of Cruceros Malaga at 23 January 2020. 20% of total shares of Cruceros Malaga
owned by Malaga Port Authority acquired by Creuers del Port de Barcelona. Total consideration paid for 20% shares
amounted to Eur 1,540 thousand (USD 1,707 thousand). Minority provided for 20% shares of the Port as of 31 December 2019
was 1,853 thousand, which was reversed for finalization of acquisition accounting.
b) Contributions and distributions
The Group's subsidiary, Bodrum Cruise Port directors, decided to increase paid in capital of the Company by TRY 4,984
thousand (USD 814 thousand) from TRY 18,000 thousand (USD 12,726 thousand) to TRY 22,984 thousand (USD 13,540 thousand).
5) Seasonality of Revenue
Sales from the Cruise business are more heavily weighted towards the second half of the calendar year with, on average,
approximately 58% of annual sales arising during the July to December period for the last three years. In 2019, 38% of
the Group's full year revenue fell in the first six months, 45% in 2018 and 43% in 2017.
6) Revenue
The Group's operations and main revenue streams are those described in the last annual financial statements. The Group's
revenue is derived mainly from cruise and commercial operations.
6 Revenue (continued)
For the six month period 30 June, revenue comprised the following:
BPI VCP EP NCP other Total Port Port of Total Total
cruise Cruise Akdeniz Adria Commerci Consolid
ports al ated
(USD '000) 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019 2020 2019
Point in
time
Container -- -- -- -- -- -- -- -- -- -- -- -- 11,4 14,9 2,75 2,75 14,2 17,6 14,2 17,6
revenue 89 30 6 7 45 87 45 87
Landing fees 1,08 10,8 308 2,51 13 784 5,04 -- 2,03 1,16 8,48 15,3 -- -- -- -- -- -- 8,48 15,3
4 89 0 4 1 0 0 43 0 43
Port service 128 753 243 483 30 757 23 -- 51 181 475 2,17 1,72 8,44 103 104 1,83 8,55 2,30 10,7
revenue 4 9 8 2 2 7 26
Cargo -- -- -- -- -- -- -- -- -- -- -- -- 2,69 2,15 590 1,05 3,28 3,20 3,28 3,20
revenue 4 1 5 4 6 4 6
Domestic 17 164 -- -- -- 20 215 -- -- 4 232 188 23 19 5 9 28 28 260 216
water sales
Income from -- -- 270 1,87 -- -- -- -- -- -- 270 1,87 -- -- -- -- -- -- 270 1,87
duty free 5 5 5
operations
Other 52 104 160 153 101 235 178 -- 97 421 588 913 424 382 7 237 431 619 1,01 1,53
revenue 9 2
Over time
Rental 209 590 771 1,22 323 503 -- -- 553 230 1,85 2,55 337 347 179 313 516 660 2,37 3,21
income 8 6 1 2 1
Management -- -- -- -- -- -- -- -- -- 813 -- 813 -- -- -- -- -- -- -- 813
fee
Construction -- -- -- -- -- -- 21,9 -- -- -- 21,9 -- -- -- -- -- -- -- 21,9 --
revenue 57 57 57
Total 1,49 12,5 1,75 6,24 467 2,29 27,4 -- 2,73 2,80 33,8 23,8 16,6 26,2 3,64 4,47 20,3 30,7 54,1 54,6
0 00 2 9 9 17 2 9 58 57 96 77 0 5 36 52 94 09
The following table provides information about receivables, contract assets and contract liabilities from contracts with
customers;
Revenue Period ended Period ended Year ended
30 June 2020 30 June 2019 31 December
2019
(USD '000) (USD '000)
(USD '000)
Receivables, which 17,430 19,865 19,195
are included in
'trade and other
receivables'
Contract assets 1,765 3,084 1,765
Contract liabilities (967) (1,427) (967)
18,228 21,522 19,993
The contract assets primarily relate to the Group's rights to consideration for work completed but not billed at the
reporting date on Commercial services provided to vessels and rental agreements. The contract assets are transferred to
receivables when the rights become unconditional. This occurs when the Group issues an invoice to the customer.
The contract liabilities primarily relate to the advance consideration received from customers for providing services,
for which revenue is recognised over time. These amounts will be recognised as revenue when the services has provided to
customers and billed, which was based on the nature of the business less than one week period.
The amount of $967 thousand recognised in contract liabilities at the beginning of the period has been recognised as
revenue for the period ended 30 June 2020.
The amount of revenue recognised in the period ended 30 June 2020 from performance obligations satisfied (or partially
satisfied) in previous periods is $1,765 thousand. This is mainly due to the nature of operations.
No information is provided about remaining performance obligations at 30 June 2020 that have an original expected
duration of one year or less, as allowed by IFRS 15.
7) Finance income and costs
Finance income comprised the following:
Finance Six months ended Six months ended Year ended 31
income 30 June 2020 30 June 2019 December 2019
(USD '000) (USD '000) (USD '000)
(Unaudited) (Unaudited) (Audited)
Other foreign 10,915 9,653 6,065
exchange
gains (*)
Interest 46 725 248
income on
banks and
others
Interest 12 5 3
income from
housing loans
Interest -- -- 1,766
income from
debt
instruments
Other income 24 143 --
Total 10,997 10,526 8,082
(*) The Group's foreign exchange gains arise mainly through its operations in Turkey, depreciation of TL against the
functional currencies of these entities results in a benefit as the cost base is significantly more weighted to TL than
the revenues.
The income from financial instruments within the category financial assets at amortized costs is USD 82 thousand (30 June
2019: USD 873 thousand, 31 December 2019: USD 251 thousand).
Finance costs comprised the following:
Finance costs Six months Six months ended Year ended 31
ended 30 June 30 June 2019 December 2019
2020
(USD '000) (USD '000)
(USD '000)
(Unaudited) (Audited)
(Unaudited)
Interest 13,372 12,671 26,077
expense on
loans and
borrowings
Foreign 6,388 3,841 5,222
exchange
losses from
Eurobond
Foreign 10,883 9,227 3,956
exchange
losses on
loans and
borrowings
Interest 2,191 1,655 2,434
expense on
lease
obligations
Other foreign 1,096 879 2,584
exchange
losses
Other interest 47 8 235
expenses
Letter of 12 118 215
guarantee
commission
expenses
Loan 619 365 1,097
commission
expenses
Unwinding of 191 122 355
discounts
during the
year
Other costs 79 77 158
Total 34,878 28,963 42,333
(*) The Group's foreign exchange losses arise mainly through its USD denominated borrowings held in a Turkish Lira
functional currency entity.
The interest expense for financial liabilities not classified as fair value through profit or loss is USD 15,610 thousand
(30 June 2019: USD 14,334 thousand, 31 December 2019: USD 28,355 thousand).
8) Trade and other receivables
Six months ended Year ended 31 Six months ended
30 June 2020 December 2019 30 June 2019
(USD '000) (USD '000) (USD '000)
(Unaudited) (Audited) (Unaudited)
Trade 9,838 20,960 22,950
receivables
Deposits and 5,539 8,357 18,185
advances
given
Other 2,219 1,705 1,781
receivables
Total trade 17,596 31,022 42,916
and other
receivables
Venetto Sviluppo, the 51% shareholder of APVS, which in turn owns a 53% stake in Venezia Terminal Passegeri S.p.A (VTP),
has a put option to sell its shares in APVS partially or completely (up to 51%) to Venezia Investimenti (VI). This option
originally can be exercised between 15th May 2017 and 15th November 2018, extended until the end of November 2021. If VS
exercises the put option completely, VI will own 99% of APVS and accordingly 71.51% of VTP. The Group has given a
guarantee letter for its portion of 25% in VI, which in turn has given the full amount of call option as guarantee letter
to VS.
9) Capital and reserves
Dividends
Dividend distribution declarations are made by the Company in GBP and paid in USD in accordance with its articles of
association, after deducting taxes and setting aside the legal reserves as discussed above.
The Board of the Company has decided to temporarily suspend the dividend for full year 2019, until the situation related
to spread of Covid-19 ("coronavirus") becomes clearer.
GPH PLC proposed and paid a 2019 interim dividend of GBP 0.155 per share to its shareholders, giving a distribution of
GBP 9,738 thousand (USD 12,580 thousand).
GPH PLC declared 2018 final dividend of GBP 0.212 per share to its shareholders on 24 May 2019 and paid on 5 July 2019,
giving a distribution of GBP 13,319 thousand (USD 16,645 thousand).
The total dividends in respect of the year ended 31 December 2019 were USD 29,225 thousand.
Dividends to non-controlling interests totaled USD 237 in 2020 (2019: USD 6,366 thousand) and comprised a distribution of
USD 213 thousand (2019: USD 3,751, fully paid in cash) made to other shareholders by Barcelona Port Investments no cash
settlement, a distribution of USD 25 thousand (2019: USD 2,550 thousand, USD 1,264 paid in cash) made to other
shareholders by Valletta Cruise Port (2019: a distribution of USD 65 thousand made to other shareholders by Cagliari
Cruise Port no cash settlement).
10) Loans and borrowings
Loans and borrowings comprised the following:
Short term loans and As at As at As at
borrowings
30 June 2020 31 December 30 June 2019
(USD '000) 2019 (USD '000)
(Unaudited) (USD '000) (Unaudited)
(Audited)
Short term portion of 28,925 18,554 18,549
bonds issued (i), (ii)
Short term bank loans 17,350 12,497 3,339
3,509 3,632 3,259
· TL
13,841 8,865 80
· Other currencies
Short term portion of 30,911 29,899 33,125
long term bank loans
5,327 822 834
· TL
25,584 29,077 32,291
· Other currencies
Lease obligations 1,764 1,741 3,282
2 622 1,564
· Finance leases
1,762 1,119 1,718
· Lease obligations
recognized under
IFRS 16
Total 78,950 62,691 58,295
Long term loans and As at As at As at
borrowings
30 June 2020 31 December 30 June 2019
(USD '000) 2019 (USD '000)
(Unaudited) (USD '000) (Unaudited)
(Audited)
Long term portion of 346,893 232,436 231,972
bonds issued (i), (ii)
Long term bank loans 70,770 94,156 58,946
-- 7 25
· TL
70,770 94,149 58,921
· Other currencies
Finance lease 62,584 63,707 60,736
obligations
-- -- 1,509
· Finance leases
62,584 63,707 59,227
· Lease obligations
recognized under
IFRS 16
Total 480,247 390,299 351,654
(i) The sales process of the Eurobond issuances amounting to USD 250 million with 7 years of maturity, and a 8.125%
coupon rate based on 8.250% reoffer yield was completed on 14 November 2014. Coupon repayment are made semi-annually. The
bonds are quoted on the Irish Stock Exchange.
Eurobonds contain the following key financial covenants:
If a concession termination event occurs at any time, Global Liman (the "Issuer") must offer to repurchase all of the
notes pursuant to the terms set forth in the indenture (a "Concession Termination Event Offer"). In the Concession
Termination Event Offer, the Issuer will offer a "Concession Termination Event Payment" in cash equal to 100% of the
aggregate principal amount of notes repurchased, in addition to accrued and unpaid interest and additional amounts, if
any, on the notes repurchased, to the date of purchase (the "Concession Termination Event Payment Date"), subject to the
rights of holders of notes on the relevant record date to receive interest due on the relevant interest payment date.
According to the Eurobond issued by Global Liman, the consolidated leverage ratio may not exceed 5.0 to 1 (incurrence
covenant). The consolidated leverage ratio as defined in the Eurobond includes Global Liman as the issuer and all of its
consolidated subsidiaries excluding Nassau Cruise Port and Antigua Cruise Port (both being Unrestricted Subsidiaries as
defined in the Eurobond). Irrespective of the consolidated leverage ratio, the issuer will be entitled to incur any or
all of the following indebtedness:
· Indebtedness incurred by the Issuer, Ege Ports ("Guarantor") or Ortadogu Liman ("Guarantor") pursuant to one or more
credit facilities in an aggregate principal amount outstanding at any time not exceeding USD 5 million;
· Purchase money indebtedness incurred to finance the acquisition by, the Issuer or a Restricted Subsidiary, of assets
in the ordinary course of business in an aggregate principal amount which, when added together with the amount of
indebtedness incurred and then outstanding, does not exceed USD 10 million; and
10 Loans and borrowings (continued)
· Any additional indebtedness of the Issuer or any Guarantor (other than and in addition to indebtedness permitted
above) and Port of Adria indebtedness, provided, however, that the aggregate principal amount of Indebtedness
outstanding at any time of this clause does not exceed USD 20 million; and provided further, that more than 50% in
aggregate principal amount of any Port of Adria indebtedness incurred pursuant to this clause is borrowed from the
International Finance Corporation and/or the European Bank for Reconstruction and Development.
Group debt covenants are calculated based on applicable IFRSs as of the time the lease obligations were initially
recognised. Therefore, the group debt covenants as at period end have not been affected from the transition to IFRS 16.
Management will assess in the future for any new transactions that will be entered into, depending on the nature of them,
whether debt covenants' calculations are affected.
(ii) Nassau Cruise Port has issued an unsecured bond with a total nominal volume of USD 150 million pursuant to the Bond
Subscription Agreement dated 29 June 2020. The unsecured bonds have been sold to institutional investors at par across
two tranches in local currency Bahamian Dollar and US-Dollar, which are pari-passu to each other, and with a fixed coupon
of 8.0% across both tranches payable semi-annually starting 30 June 2021. Final maturity of the bond is 30 June 2040,
principal repayment will occur in ten equal, annual installments, beginning in June 2031 and each year afterwards until
final maturity. Bonds with a nominal value of USD 25 million will be issued later in H2-2020 based on firm and binding
subscriptions from certain investors (delay draw).
The bonds are general obligation of Nassau Cruise Port and not secured by any specific collateral or guarantee. No other
entity of the Group has provided any security or guarantee with respect to the Nassau Cruise Port bond. The bond contains
a covenant that Nassau Cruise Port must maintain a minimum debt service coverage ratio of 1.30x prior to the distribution
of any dividends to shareholders.
11) Provisions
For the period ended 30 June, the movements of the provisions as below:
Replacement Italian Nassau Unused Legal Other Total
provisions Ports Ancill vacati
for Creuers Concess ary ons
(*) ion fee contri
provisi bution
on provis
(***) ion
(**)
Balance at 6,925 1,065 10,428 276 1,295 229 20,21
1 January 8
Provisions 314 -- 156 81 -- 20 571
created
through p&l
Provisions -- -- 2,964 -- (1,27 1,277 2,964
created 7)
through
reclassific
ation
Paid in -- -- (1,350 -- -- -- (1,35
cash ) 0)
Reversal of -- (104) -- (10) -- (218) (332)
provisions
Unwinding 134 52 -- -- -- 4 190
of
provisions
Currency 53 (4) -- (28) (2) (145) (126)
translation
difference
Balance at 7,426 1,009 12,198 319 16 1,167 22,13
30 June 5
Non-current 7,426 702 7,150 -- -- 28 15,30
6
Current -- 307 5,048 319 16 1,139 6,829
7,426 1,009 12,198 319 16 1,167 22,13
5
(*) As part of the concession agreement between Creuers and the Barcelona and Malaga Port Authorities entered in 2013,
the Company has an obligation to maintain the port equipment in good operating condition throughout its operating period,
and in addition return the port equipment to the Port Authorities in a specific condition at the end of the agreement.
(**) As part of agreement between NCP and Government of Bahamas entered in 2019 (see note 30(c)), ancillary contributions
will be made to local community to increase the wealth of people of Bahamas. These payments will be made as grant and
partly as interest free loan. Therefore, a provision is provided for ancillary contributions based on Management's best
estimate of these payments.
11 Provisions (continued)
(***) On 16 December 2009, Ravenna Port Authority and Ravenna Passenger Terminal S.r.l. ("RTP") entered into an agreement
regarding the operating concession for the Ravenna Passenger Terminal which terminates on 27 December 2019. RTP had an
obligation to pay a concession fee to the Port Authority of Euro 86,375 per year until end of concession. The expense
relating to this concession agreement is recognized on a straight-line basis over the concession period, giving rise to
an accrual in the earlier years.
On 13 June 2011, Catania Port Authority and Catania Cruise Terminal S.r.l. ("CCT") entered into an agreement regarding
the operating concession for the Catania Passenger Terminal which terminates on 12 June 2026. CCT had an obligation to
pay a concession fee to the Catania Port Authority of Euro 135,000 per year until end of concession. The expense relating
to this concession agreement is recognized on a straight-line basis over the concession period, giving rise to an accrual
in the earlier years.
12) Earnings / (Loss) per share
The Group presents basic earnings per share ("basic EPS") data for its ordinary shares. Basic EPS is calculated by
dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of
ordinary shares outstanding during the period, less own shares acquired.
During the year, the Group introduced share-based payments as part of its long-term incentive plan to directors and
senior management. The shares to be granted to the participants of the scheme are only considered as potential shares
when the market vesting conditions are satisfied at the reporting date. None of the market conditions are satisfied at
the reporting date and therefore there is no dilution of the earnings per share or adjusted earnings per share (Note 2f).
There are no other transactions that can result in dilution of the earnings per share or adjusted earnings per share
(Note 2f).
Earnings per share is calculated by dividing the profit attributable to ordinary shareholders, by the weighted average
number of shares outstanding.
As at As at As at
30 June 2020 30 June 2019 31 December
(USD '000) (USD '000) 2019
(Unaudited) (Unaudited) (USD '000)
(Audited)
(Loss) / Profit (29,035) (16,317) (18,558)
attributable to owners
of the Company
Weighted average 62,826,963 62,826,963 62,826.963
number of shares
Basic and diluted (46.2) (26.0) (29.5)
(loss) / earnings per
share (cents per
share)
13) Commitment and contingencies
Legal proceedings in relation to Ortadogu Antalya, Ege Liman and Bodrum Liman's applications for extension of their
concession rights
On 6 June 2013, the Turkish Constitutional Court partially annulled a law that prevented operators of privatised
facilities from applying to extend their operating term. The respective Group companies then applied to extend the
concession terms of Port Akdeniz-Antalya, Ege Port-Kusadasi and Bodrum Cruise Port to give each concession a total term
of 49 years from original grant date. After these applications were rejected, the respective Group companies filed
lawsuits with administrative courts challenging the decisions.
After going through legal proceedings, Bodrum Cruise Port's application for the extension of concession term is accepted
by the relevant administrative authority. The extension agreement is executed on December 2018 which has extended the
remaining concession period to 49 years. The original concession agreement was due to expire in December 2019 and
following this new agreement the concession will now expire in December 2067.
13 Commitment and contingencies (continued)
Port Akdeniz-Antalya filed lawsuits against Privatization Administration and the General Directorate of Turkey Maritime
Organization requesting cancellation with respect to rejection of the extension applications. The Court dismissed the
case and the Group lawyers appealed the Court decision to the Council of State. The Counsel of State rejected the appeal
of Port Akdeniz-Antalya and approved the decision of the Court. The Group lawyers have applied to the Council of State
for reversal of this judgement and the case is still pending.
Ege Port-Kusadasi filed lawsuits against Privatization Administration and General Directorate of Turkey Maritime
Organization requesting cancellation with respect to rejection of the extension applications. The Court dismissed the
case and the Group lawyers appealed the Court decision to the Council of State. The Counsel of State accepted the appeal
and reversed the Court's judgement in favor of Ege Port-Kusadasi. The Privatization Administration applied to the Council
of State for reversal of this judgement and this time, the Council of State has changed its standpoint and approved the
Court's decision against Ege Port-Kusadasi. In this regard, Ege Port-Kusadasi has submitted an individual application to
the Constitutional Court. Constitutional Court has rendered its decision against Ege Port-Kusadasi and the judicial
process for the extension of the concession period has been concluded against Ege Port-Kusadasi. Accordingly, upon
expiration of the concession period in 2033, Ege Port-Kusadasi will need to participate in the tender for new concession
term.
Competition Authority Investigation
On 29 April 2019, the Competition Authority notified Port Akdeniz, that it has commenced an investigation into Port
Akdeniz due to an alleged breach of Article 6 of the Law on the Protection of Competition, Law No. 4054 due to excessive
pricing concerns on certain services. Port Akdeniz has engaged legal representation and submitted a full defence against
all allegations on 28 May 2019. Subsequently, the investigation report issued by the Competition Authority is notified to
Port Akdeniz on 15 April 2020. Whole process before the Competition Authority may take up to an additional 6 to 12 months
(excluding the possibility to file an administrative lawsuit against a negative decision of the Competition Authority).
Other legal proceedings
The Port of Adria-Bar (Montenegro) is a party to the disputes arising from the collective labour agreement executed with
the union by Luka Bar AD (former employer/company), which was applicable to Luka Bar AD employees transferred to Port of
Adria-Bar. The collective labour agreement has expired in 2010, before the Port was acquired by the Group under the name
of Port of Adria-Bar. However, a number of lawsuits have been brought in connection to this collective labour agreement
seeking (i) unpaid wages for periods before the handover of the Port to the Group, and (ii) alleged underpaid wages as of
the start of 2014. On March 2017, the Supreme Court of Montenegro adopted a Standpoint in which it is ruled that
collective labour agreement cannot be applied on rights, duties and responsibilities for employees of Port of Adria-Bar
after September 30th, 2010. Although the Standpoint has established a precedent that has applied to the claims for the
period after September 30th, 2010; there are various cases pending for claims related to the period of October 1st, 2009
- September 30th, 2010. In respect of the foregoing period of one year, the Port of Adria-Bar has applied to the
Constitutional Court to question the alignment of the collective labour agreement with the Constitution, Labor Law and
general collective agreement. The Port of Adria-Bar is notified that the application for initiating the procedure for
reviewing the legality of the Collective Agreement has been rejected due to a procedural reason, without evaluating the
arguments submitted. In evaluation of the pending cases, the local courts have given decisions contradicting with the
previous decisions which have enabled Port of Adria to appeal to higher court and request re-examination of the
applicability of the disputed clauses of collective labour agreement. The decision of the higher court is pending.
13 Commitment and contingencies (continued)
Global Liman Isletmeleri AS, as the majority shareholder of one of its subsidiaries, has paid a share purchase amount of
1,500,000 USD to the shareholder of the relevant subsidiary, and the shareholder has not transferred its shares in the
subsidiary to Global Liman. Global Liman has initiated an action of debt against the shareholder. It is expected that the
case would resolve for the return of the share purchase amount or the completion of the share transfer.
One of Port Akdeniz' clients in the cement business has initiated a lawsuit against Port Akdeniz in relation to a
commercial dispute on the fees payable by that client for its import and export transactions in 2018. Furthermore, a
counter-claim has been initiated by Port Akdeniz for an amount due from this client in relation to loading services
provided and extra fees incurred due to delays. During the initial court proceedings, Port Akdeniz and the client have
executed a settlement agreement and withdrawn their respective claims at the competent court. The settlement agreement
incorporates commercial terms in favour of both parties ensuring the continuity of the trade between the parties.
14) Related parties
There are no changes in the related parties of these interim financial statements compared to those used in the Group's
consolidated financial statements as at and for the year ended 31 December 2019.
All related party transactions between the Company and its subsidiaries have been eliminated on consolidation and are
therefore not disclosed in this note.
Due from related parties
Current and non-current receivables from related parties comprised the following:
Current receivables As at As at As at
from related parties
30 June 2020 31 December 30 June 2019
(USD '000) 2019 (USD '000)
(Unaudited) (USD '000) (Unaudited)
(Audited)
Global Yatirim Holding 12 312 681
Adonia Shipping (*) 66 59 61
Naturel Gaz (*) -- -- 73
Straton Maden (*) 66 67 67
Global Menkul -- -- --
IEG Global -- 56 57
Global Ports Holding 24 4 3
BV
Lisbon Cruise 39 44 --
Terminals lda
Mehmet Kutman -- -- 1
Aysegül Bensel -- -- --
Other Global Yatirim 165 229 114
Holding Subsidiaries
Total 372 771 1,057
Non-current As at As at As at
receivables from
related parties
30 June 2020 31 December 30 June 2019
(USD '000) 2019 (USD '000)
(Unaudited) (USD '000) (Unaudited)
(Audited)
Goulette Cruise 7,338 6,811 --
Holding (**)
Total 7,338 6,811 --
(*) These amounts are payments in advance for contracted work. These have an interest rate changed of 9.75% p.a. as at 30
June 2020 (31 December 2019: 11.75%, 30 June 2019: 9.75%).
(**) Company is financing its Joint venture for the payment of La Goultte Shipping Company acquisition price with a
maturity of 5 years. Yearly interest of 4.5% is charged.
14 Related parties (continued)
Due to related parties
Current payables to related parties comprised the following:
As at As at As at
Current payables to 30 June 2020 31 December 30 June 2019
related parties
(USD '000) 2019 (USD '000)
(Unaudited) (USD '000) (Unaudited)
(Audited)
Mehmet Kutman 341 545 344
Global Sigorta (*) 184 527 41
Global Menkul (*) -- --
Aysegül Bensel 136 154 114
Other Global Yatirim 1 91 5
Holding Subsidiaries
Total 662 1,317 504
(*) These amounts are related to professional services provided. These have an interest rate of 12.50% p.a. as at 30 June
2020 (31 December 2019: 12.50%, 30 June 2019: 19.50%).
Transactions with related parties
Transactions with other related parties comprised the following for the following periods:
(USD Six months ended Six months Year ended
'000) ended
30 June 2020 31 December
30 June 2019 2019
(Unaudited)
(Unaudited) (Audited)
Interest Other Interest Other Interest Other
received Received received
Global -- -- -- -- 203 --
Yatiri
m
Holdin
g
Global -- -- -- -- -- --
Menkul
Total -- -- -- -- 203 --
USD
'000
Project Other Project Other Project Other
Expenses Expenses Expenses
Global -- 1 -- 1 920 138
Yatiri
m
Holdin
g
Global -- -- -- -- -- 1
Menkul
Total -- 1 -- 1 920 139
15) Financial Instruments' fair value disclosures
Fair value measurements
The information set out below provides information about how the Group determines fair values of various financial assets
and liabilities.
Determination of the fair value of a financial instrument is based on market values when there are two counterparties
willing to sell or buy, except under the conditions of events of default forced liquidation. The Group determines the
fair values based on appropriate methods and market information and uses the following assumptions: the fair values of
cash and cash equivalents, other monetary assets, which are short term, trade receivables and payables and long term
foreign currency loans and borrowings with variable interest rates and negligible credit risk change due to borrowings
close to year end are expected to approximate to the carrying amounts.
15 Financial Instruments' fair value disclosures (continued)
Fair value measurements (continued)
The fair value hierarchy is based on inputs to valuation techniques that are used to measure fair value that are either
observable or unobservable and consists of the following three levels:
· Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities;
· Level 2: Input other than quoted prices included within level 1 that are observable for the assets or liabilities,
either directly (i.e. as prices) or indirectly (i.e. derived from prices);
· Level 3: Inputs for the asset or liability that is not based on observable market data (unobservable inputs).
Except as detailed in the following table, the directors consider the carrying amounts of the Group's financial assets
and financial liabilities were approximate to their fair values.
Note As at 30 June As at 31 As at 30 June
2020 December 2019 2019
(Unaudited) (Audited) (Unaudited)
(USD Carrying Fair Carrying Fair Carrying Fair
'000)
Financial
assets
Other 54 54 71 71 12,613 12,613
financial
assets
Financial
liabiliti
es
Loans and 10 494,850 481,75 387,542 381,373 345,931 342,377
borrowing 4
s
Lease 64,408 64,408 65,448 65,448 64,018 64,018
obligatio
ns
The Group's lease obligations fair value has been obtained using the discounted cash flow model.
All loans have been included in Level 2 of the fair value hierarchy as they have been valued using quotes available for
similar liabilities in the active market. The valuation technique and inputs used to determine the fair value of the
loans and borrowings is based on discounted future cash flows and discount rates.
The groups Eurobond liability has been included in level 1 of the fair value hierarchy as it has been valued using quotes
available on its quoted market.
The fair value of loans and borrowings has been determined in accordance with the most significant inputs being
discounted cash flow analysis and discount rates.
Financial instruments at fair value
The table below analyses the valuation method of the financial instruments carried at fair value. The different levels
have been defined as follows:
(USD '000)
Level 1 Level 2 Level 3 Total
As at 30 June Other financial -- -- -- --
2020 (Unaudited) assets
Derivative -- 415 -- 415
financial
liabilities
As at 31 Other financial -- -- -- --
December 2019 assets
(Audited)
Derivative -- 485 -- 485
financial
liabilities
As at 30 June Other financial -- -- 12,613 12,61
2019 (Unaudited) assets 3
Derivative -- 669 -- 669
financial
liabilities
The valuation technique and inputs used to determine the fair value of the interest rate swap is based on future cash
flows estimated based on forward interest rates (from observable yield curves at the end of the reporting period) and
contract interest rates, discounted at a rate that reflects the credit risk of various counterparties.
16) Events after the reporting date
None.
ISIN: GB00BD2ZT390
Category Code: IR
TIDM: GPH
Sequence No.: 82475
EQS News ID: 1120929
End of Announcement EQS News Service
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August 20, 2020 02:04 ET (06:04 GMT)
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