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| Name | Symbol | Market | Type |
|---|---|---|---|
| Petrol 4.24% | LSE:74JJ | London | Bond |
| Price Change | % Change | Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0 | - |
From Jun 2019 to Jun 2024
TIDM74JJ
RNS Number : 4479D
Petrol AD
09 October 2018
INTERIM CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIODED JUNE 30, 2018
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
For the period ended June 30
Hot Features
Premium
Note 2018 2017
BGN'000 BGN'000
Revenue 2 238,185 221,647
Other income 3 4,149 398
Cost of goods sold (211,569) (197,007)
Materials and consumables 4 (1,836) (1,870)
Hired services 5 (17,271) (18,771)
Employee benefits 6 (9,162) (9,180)
Depreciation and amortisation 10, 11 (471) (808)
Impairment losses 5 -
Other expenses 7 (649) (1,015)
Finance income 8 55,410 255
Finance costs 8 (1,662) (1,597)
Profit (loss) before income tax 55,129 (7,948)
--------- ---------
Tax income (expense) 9 70 (27)
--------- ---------
Profit (loss) for the period 55,199 (7,975)
--------- ---------
Total comprehensive income for the
period 55,199 (7,975)
Profit (loss) attributable to:
Owners of the Parent company 55,199 (7,975)
Non-controlling interest - -
Profit (loss) for the period 55,199 (7,975)
========= =========
Total comprehensive income attributable
to:
Owners of the Parent company 55,199 (7,975)
Non-controlling interest - -
--------- ---------
Total comprehensive income for the
period 55,199 (7,975)
========= =========
Profit (loss) per share (BGN) 18 0.51 (0.07)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Note June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Non-current assets
Property, plant and equipment and intangible
assets 10 14,315 14,398
Investment properties 11 1,813 1,812
Goodwill 12 19,827 40
Deferred tax assets 9 3,762 3,692
Trade and other receivables 16 95 95
Total non-current assets 39,812 20,037
--------- --------
Current assets
Inventories 13 24,433 20,990
Loans granted 15 24,185 18,894
Trade and other receivables 16 45,112 32,733
Non-current assets held-for-sale 14 42 42
Cash and cash equivalents 17 4,069 7,271
Total current assets 97,841 79,930
--------- --------
Total assets 137,653 99,967
========= ========
Equity
Registered capital 18 109,250 109,250
General reserves 18,864 18,864
Accumulated loss (107,087) (162,286)
--------- ---------------
Total equity attributable to the owners
of the Parent company 21,027 (34,172)
--------- ---------------
Non-controlling interests 10 10
--------- ---------------
Total equity 21,037 (34,162)
---------
Non-current liabilities
Loans and borrowings 19 38,060 38,144
Employee defined benefit obligations 20 441 441
Total non-current liabilities 38,501 38,585
--------- ---------------
Current liabilities
Trade and other payables 21 76,064 92,010
Loans and borrowings 19 2,051 3,478
Current income tax liabilities 22 - 56
Total current liabilities 78,115 95,544
--------- ---------------
Total liabilities 116,616 134,129
========= ===============
Total equity and liabilities 137,653 99,967
========= ===============
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Equity attributable to the Non-controlling Total
owners of the Parent interests equity
company
Registered General Accumulated Total
capital reserves profit
(loss)
BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000
Balance at January
1, 2017 106,482 18,864 (161,702) (36,356) 10 (36,346)
Comprehensive income
for the period
Loss for the period - - (7,975) (7,975) - (7,975)
----------- ---------- ------------ --------- ---------------- -----------
Total comprehensive
income - - (7,975) (7,975) - (7,975)
----------- ---------- ------------ --------- ---------------- -----------
Balance at June 30,
2017 106,482 18,864 (169,677) (44,331) 10 (44,321)
=========== ========== ============ ========= ================ ===========
Comprehensive income
for the period
Profit for the period - - 9,352 9,352 - 9,352
Other comprehensive
income - - (22) (22) - (22)
Total comprehensive
income - - 9,330 9,330 - 9,330
----------- ---------- ------------ --------- ---------------- -----------
Transactions with
shareholders,
recognized directly
in equity
Sale of ordinary shares 2,768 - (1,939) 829 - 829
Total transactions
with shareholders 2,768 - (1,939) 829 - 829
----------- ---------- ------------ --------- ---------------- -----------
Balance at December
31, 2017 109,250 18,864 (162,286) (34,172) 10 (34,162)
=========== ========== ============ ========= ================ ===========
Comprehensive income
for the period
Profit for the period - - 55,199 55,199 - 55,199
----------- ---------- ------------ --------- ---------------- -----------
Total comprehensive
income - - 55,199 55,199 - 55,199
----------- ---------- ------------ --------- ---------------- -----------
Balance at June 30,
2018 109,250 18,864 (107,087) 21,027 10 21,037
=========== ========== ============ ========= ================ ===========
CONSOLIDATED STATEMENT OF CASH FLOWS
For the period ended June 30
2018 2017
BGN'000 BGN'000
Cash flows from operating activities
Net profit (loss) before taxes 55,129 (7,948)
Adjustments for:
Depreciation/amortization of property, plant
and equipment and intangible assets 471 808
Interest expense and bank commissions, net 905 1,459
Shortages and normal loss, net of excess
assets (91) (48)
Provisions for unused paid leave and retirement
benefits 315 314
Reversed impairment loss (5) -
Receivables written-off - 1
Payables written-off (120) -
Gain on sale of subsidiaries (54,621) -
Profit on sale of assets (3,831) (2)
(1,848) (5,416)
Change in trade payables 24,397 4,016
Change in inventories (3,367) 3,297
Change in trade and other receivables (18,616) 1,038
Cash flows generated from operating activities 566 2,935
Interest, bank fees and commissions paid (2,289) (3,354)
Income tax paid (56) (128)
-------- --------
Net cash from operating activities (1,779) (547)
Cash flows from investing activities
Payments for purchase of property, plant
and equipment (950) (369)
Proceeds from sale of property, plant and
equipment 3,545 8
Payments for loans granted, net (4,360) -
Proceeds from loans granted, net 147 -
Interest received on loans granted 10 107
Payments for acquisition of subsidiary and
other investments, net of cash acquired 16 (349)
Disposals cash from the sale of subsidiaries,
net of proceeds from sale (47) -
Payments for acquisitions of other investments 530 -
Net cash flows used in investing activities (1,109) (603)
Cash flows from financing activities
Proceeds from loans and borrowings 166 850
Payments of loans and borrowings (262) (219)
Net cash flows from financing activities (96) 631
Net decrease in cash flows during the period (2,984) (519)
Cash and cash equivalents at the beginning
of the period 7,085 5,334
Effect of movements in exchange rates (32) (117)
-------- --------
Cash and cash equivalents at the end of
the period 4,069 4,698
======== ========
Notes
to the interim consolidated financial report
for the period ended June 30, 2018
1. Segments reporting
The Group has identified the following operating segments, based on the reports presented to the Group's Management, which are used in the process of strategic decision-making:
-- Wholesale of fuels - wholesale of petroleum products in Bulgaria;
-- Retail of fuels - retail of petroleum and other products through a network of petrol stations.
-- Other activities - financial and accounting services, consultancy, rental income and other activities.
The segment information, presented to the Group's Management for the years ended as of June 30, 2018 and 2017 is as follows:
June 30 Wholesale Retail All other Total for
of fuels of fuels segments the Group
2018
BGN'000 BGN'000 BGN'000 BGN'000
Total segment revenue 6,095 235,868 1,125 243,088
Intra-group revenue - 11 743 754
Revenue from external
customers 6,095 235,857 382 242,334
Adjusted EBITDA 224 1,322 301 1,847
Depreciation/amortization 2 396 73 471
Impairment (5) - (5)
June 30 Wholesale Retail All other Total for
of fuels of fuels segments the Group
2017
BGN'000 BGN'000 BGN'000 BGN'000
Total segment revenue 7,250 215,610 1,052 223,912
Intra-group revenue 1 1,114 752 1,867
Revenue from external
customers 7,249 214,496 300 222,045
Adjusted EBITDA 529 (6,502) 175 (5,798)
Depreciation/amortization - 800 8 808
Impairment - - - -
The policies for recognition of revenue from intra-group sales and sales to external clients for the purposes of the reporting by segments do not differ from these applied by the Group for revenue recognition in the consolidated statement of profit and loss and other comprehensive income.
The Management of the Group evaluates the results of the performance of the segments based on the adjusted EBITDA[1]. In the calculation of the adjusted EBITDA the effect of the impairment of assets is not taken into account. The reconciliation of the adjusted EBITDA and the profit (loss) before tax is presented in the table below:
June 30 June 30
2018 2017
BGN'000 BGN'000
Adjusted EBITDA - reporting segments 1,546 (5,973)
Adjusted EBITDA - all other segments 301 175
Depreciation/amortization (471) (808)
Impairment of assets 5 -
Finance income(costs), net 53,748 (1,342)
Profit (loss) before tax 55,129 (7,948)
========= =========
2. Revenue from sales
June 30 June 30
2018 2017
. . . .
Sales of goods 234,954 217,891
Sales of services 3,231 3,756
-------- --------
238,185 221,647
======== ========
3. Other income
June 30 June 30
2018 2017
BGN'000 BGN'000
Gain on sale of property, plant, equipment
and materials including: 3,831 2
Income from sales 4,729 1,029
Carrying amount (898) (1,027)
Surpluses of assets 141 119
Payables written-off 120 1
Insurance claims 32 29
Penalties and indemnities 25 41
Other - 206
--------- ---------
4,149 398
========= =========
4. Materials and consumables
June 30 June 30
2018 2017
BGN'000 BGN'000
Electricity and heating 1,035 1,011
Fuels and lubricants 209 127
Spare parts 170 277
Office consumables 170 183
Working clothes 101 107
Water supply 52 59
Advertising materials 42 38
Other 57 68
--------- ---------
1,836 1,870
========= =========
5. Hired services
June 30 June 30
2018 2017
BGN'000 BGN'000
Rents 6,856 8,183
Dealer and other commissions 5,526 4,785
Maintenance and repairs 1,565 1,711
Consulting, training and audit 911 868
Security 410 423
Communications 409 406
Cash collection expense 371 369
Advertising 264 241
State, municipal fees and other costs 261 1,012
Insurances 214 263
Software licenses 127 119
Transport 70 60
Other 287 331
--------- ---------
17,271 18,771
========= =========
Rental costs include BGN 5,621 thousand for rent of petrol stations under operating lease agreements. (June 30, 2017: BGN 6,837 thousand).
6. Personnel expenses
June 30 June 30
2018 2017
BGN'000 BGN'000
Wages and salaries 7,804 7,840
Social security contributions and benefits 1,358 1,340
--------- ---------
9,162 9,180
========= =========
7. Other expenses
June 30 June 30
2018 2017
BGN'000 BGN'000
Penalties and indemnities 199 26
Local taxes and taxes on expenses 177 115
Entertainment expenses and sponsorship 139 730
Scrap, shortages and written-off assets 50 71
Business trips 17 27
Other 67 46
--------- ---------
649 1,015
========= =========
8. Finance income and costs
June 30 June 30
2018 2017
BGN'000 BGN'000
Finance income
Interest income, including 757 138
Interest income on loans granted 706 45
Interest income on trade receivables 51 89
Other interest income - 4
Gain on sale of subsidiaries, incl.: 54,621 -
Revenue from sales 25 -
Carrying amount of the Group's interest -
in the net assets of the subsidiaries 54,596
Net foreign exchange gain 32 117
55,410 255
--------- ---------
Finance cost
Interest costs, including: (1,374) (1,413)
Interest expenses on debenture loans (1,251) (1,240)
Interest expenses to the state budget (45) (99)
Interest expenses on bank loans (55) (68)
Interest expenses on trade loans (15) (1)
Interest expenses on trade and other payables (8) (5)
Bank fees, commissions and other financial
expenses (288) (184)
--------- ---------
(1,662) (1,597)
--------- ---------
Finance income (costs), net 53,748 (1,342)
========= =========
9. Taxation
9.1. Tax expenses
Tax expense recognised in profit or loss includes the amount of current and deferred income tax expenses in accordance with IAS 12 Income taxes.
June 30 June 30
2018 2017
BGN'000 BGN'000
Current tax expense - 54
Change in deferred tax, including: (70) (27)
Temporary differences recognised during
the period 71 48
Temporary differences arisen during the
period (141) (75)
Tax (income) expense (70) 27
========= =========
9.2. Effective tax rate
The reconciliation between the accounting profit (loss) and tax expense, as well as calculation of the effective tax rate as of June 30, 2018 and December 31, 2017 is presented in the table below:
June 30 June 30
2018 2017
BGN'000 BGN'000
Profit (loss) before tax for the period 55,129 (7,948)
Applicable tax rate 10% 10%
Tax expense at the applicable tax rate 5,513 (795)
Tax effect of permanent differences 40 (78)
Tax effect of a tax asset recognized in
the current year that arose but was not
recognized in previous reporting periods (4,588) (58)
Tax effect of a tax asset not recognised
in the current year that arose in the current
period 11,182 807
Tax effect from consolidation adjustments (12,217) 151
--------- ---------
Tax (income) expense (70) 27
========= =========
Effective tax rate - -
========= =========
The respective tax periods of the Group may be subject to inspection by the tax authorities until the expiration of 5 years from the end of the year in which a declaration was submitted, or should have been submitted. Consequently additional taxes or penalties may be imposed in accordance with the interpretation of the tax legislation. The Group's management is not aware of any circumstances, which may give rise to a contingent additional liability in this respect.
In December 2014 tax audits of Parent company commenced, encompassing social security contributions and personal income tax for the period December 2008 till December 2013 and corporate income tax and value added tax (VAT) for 2013. Subsequently the corporate income tax and VAT audits were prolonged till September 2016 and the scope was increased till 2014 and June 2015, respectively. In March 2016 a tax audit act related to social security contributions for BGN 543 thousand principal and BGN 248 thousand interests was issued. It is fully appealed against by the Parent company. In April 2016 in order to suspend the execution of the appealed tax audit act, a bank guarantee of BGN 800 thousand in favor of National Revenue Agency was issued. In November 2017, the issued revision act is entirely repealed with a decision of Administrative Court - Sofia city. The tax administration appealed the decision and now the contest is pending in (Supreme Administrative Court) SAC.
In January 2017, the Parent company received a tax audit act on corporate tax revision for 2013 and VAT until October 2014 amounting to BGN 222 thousand principal and BGN 68 thousand interest. Bank guarantee of BGN 350 thousand was issued in order to ceased the execution of the appealed audit act in January 2017. In March 2017 the foreclosed properties, with carrying amount of BGN 578 thousand, which guaranteed the execution of the finalized audit proceedings, were released by the National Revenue Agency.
In March 2017, the Parent company received a tax audit act due to the audit of corporate income tax for 2014 and VAT until June 2015 for BGN 663 thousand principal and BGN 138 thousand interest. The Parent company appealed the act. In order to suspend the enforcement of the appealed audit act, ordered by the Parent company, a bank guarantee in favor of National Revenue Agency for BGN 940 thousand was issued. The bank guarantee is partly covered by BGN 300 thousand cash. In August 2017 the Director of "Appealing and tax-security practice" department issued a decision, which change the appealed revision act of the Parent company on corporate income tax for 2014 and VAT until June 2015 and reduce the additional tax liabilities from BGN 663 thousand to BGN 65 thousand principal and from BGN 138 thousand to BGN 15 thousand interest. The rest of the additionally determined tax liabilities in the revision act are in process of legal appealing. The issued bank guarantee to suspend the enforcement of the appealed audit act in favor of the National Revenue Agency of BGN 940 thousand, partly covered by BGN 300 thousand blocked cash, was replaced with new bank guarantee of BGN 94 thousand and blocked cash was released.
9.3. Recognised deferred tax assets and liabilities
Deferred tax assets and liabilities were recognized in respect of the following positions:
Asset Recognised Asset (liability) Recognised Asset
(liability) in profit as at Dec. in profit (liability)
as at and loss 31 2017 and loss as at
Jan. 1 June
2017 30 2018
BGN'000 BGN'000 BGN'000 BGN'000 BGN'000
Property, plant and
equipment (303) 19 (284) 5 (279)
Impairment of assets 3,236 583 3,819 42 3,861
Tax loss carry-forwards 2 22 24 18 42
Provisions for unused
paid leave and other
provisions 74 15 89 8 97
Excess of interest payments
in accordance with CITA - 1 1 1 2
Other temporary differences,
including unpaid benefits
to individuals 26 17 43 (4) 39
------------- ----------- ------------------ ----------- -------------
3,035 657 3,692 70 3,762
============= =========== ================== =========== =============
10. Property, plant, equipment and intangible assets
Land Buildings Plant Vehicles Other Assets Intangible Total
and under assets
equipment constr.
BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000 BGN'000
BGN'000
Cost
Balance at
January
1, 2017 9,315 10,454 22,071 690 3,468 65 3,503 49,566
Additions - - 218 - 47 36 25 326
Disposals - - (213) (118) (35) - - (366)
Balance at
June
30, 2017 9,315 10,454 22,076 572 3,480 101 3,528 49,526
-------- ---------- ---------- --------- -------- --------- ----------- ---------
Additions 2,066 - 40 - 191 126 7 2,430
Transfers - - 18 - 22 (40) - -
Disposals (172) - (105) - (136) (48) (52) (513)
Disposals on
sale
of
subsidiary (3,573) (3,790) (10,872) - (1,803) (46) - (20,084)
Balance at
December
31, 2017 7,636 6,664 11,157 572 1,754 93 3,483 31,359
-------- ---------- ---------- --------- -------- --------- ----------- ---------
Additions - - 68 - 6 1,094 93 1,261
Transfers - 29 54 - 24 (107) - -
Disposals - - (25) - (20) (886) - (931)
Balance at
June
30, 2018 7,636 6,693 11,254 572 1,764 194 3,576 31,689
-------- ---------- ---------- --------- -------- --------- ----------- ---------
Accumulated
depreciation
Balance at
January
1, 2017 - 5,387 13,262 657 2,396 - 3,434 25,136
Accumulated - 179 493 2 98 - 13 785
Disposals for
the
period - - (193) (100) (29) - - (322)
-------- ---------- ---------- --------- -------- --------- ----------- ---------
Balance at
June
30, 2017 - 5,566 13,562 559 2,465 - 3,447 25,599
-------- ---------- ---------- --------- -------- --------- ----------- ---------
Accumulated - 156 381 1 102 - 14 654
Disposals for
the
period - - (105) - (133) - (52) (290)
Disposals on
sale
of
subsidiary - (1,646) (5,892) - (1,464) - - (9,002)
-------- ---------- ---------- --------- -------- --------- ----------- ---------
Balance at
December
31, 2017 - 4,076 7,946 560 970 - 3,409 16,961
-------- ---------- ---------- --------- -------- --------- ----------- ---------
Accumulated - 105 249 - 69 - 25 448
Disposals for
the
period - - (20) - (15) - - (35)
-------- ---------- ---------- --------- -------- --------- ----------- ---------
Balance at
June
30, 2018 - 4,181 8,175 560 1,024 - 3,434 17,374
-------- ---------- ---------- --------- -------- --------- ----------- ---------
Carrying
amount
at January
1, 2017 9,315 5,067 8,809 33 1,072 65 69 24,430
======== ========== ========== ========= ======== ========= =========== =========
Carrying
amount
at June 30,
2017 9,315 4,888 8,514 13 1,015 101 81 23,927
======== ========== ========== ========= ======== ========= =========== =========
Carrying
amount
at December
31,
2017 7,636 2,588 3,211 12 784 93 74 14,398
======== ========== ========== ========= ======== ========= =========== =========
Carrying
amount
at June 30,
2018 7,636 2,512 3,079 12 740 194 142 14,315
======== ========== ========== ========= ======== ========= =========== =========
As at June 30, 2018 property, plant and equipment with carrying amount of BGN 7,530 thousand (December 31, 2017: BGN 8,322 thousand) are mortgaged and pledged as collaterals under bank loans, granted to the Group and other companies and under bank guarantee agreements.
The assets under construction include mainly incurred expenses for reconstruction of trade sites.
Management's impairment tests on property, plant and equipment, confirm that there is no evidence or circumstances indicating a sustained decline in the carrying amounts of assets, which recoverable amount significantly differs from their carrying amount.
11. Investment property
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Cost
Balance at the beginning of the period 1,859 1,835
Additions 24 24
--------- ---------
Balance at the end of the period 1,883 1,859
--------- ---------
Accumulated depreciation
Balance at the beginning of the period 47 -
Depreciation for the period 23 47
Balance at the end of the period 70 47
--------- ---------
Carrying amount at the beginning of the
period 1,812 1,835
========= =========
Carrying amount at the end of the period 1,813 1,812
========= =========
Investment property representing land and building were acquired through business combination in December 2016. The carrying amount of the investment property as at June 30, 2018 and December 31, 2017 is a maximum approximation of their fair value. The Group determines the fair value of the investment property for reporting purposes, using a valuation report of independent appraiser, which is calculated by method of net assets value and discounted net cash flows.
12. Goodwill
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Cost 19,827 2,005
Impairment loss - (1,965)
19,827 40
========= =========
In March 2018 the Group signed a contract for purchasing of 1,873,700 shares, representing 100% of the capital of Varna Storage EOOD. The goodwill recognised arising from the acquisition amounted to BGN 19,787 thousand.
The goodwill arising from the acquisition of Elit Petrol AD at the amount of BGN 1,965 thousand was impaired in previous periods and written-off in 2018 when the company was sold.
A goodwill of BGN 3 thousand, BGN 8 thousand and BGN 29 thousand was recognised in previous periods with the acquisition of the subsidiary Petrol Technologies OOD, subsidiaries Storage Invest EOOD and Storage Oil EAD, and Lozen Asset AD.
13. Inventory
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Goods, including: 23,845 20,361
Fuels 15,394 12,581
Lubricants and other goods 8,451 7,780
Materials 588 629
---------
24,433 20,990
========= =========
14. Non-current assets held for sale
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Non-current assets held for sale incl.: 42 42
Land 34 34
Buildings 8 8
42 42
========= =========
15. Loans granted
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Loans granted to unrelated parties, including 24,185 18,894
Initial value 65,582 60,048
Allowance for impairment (41,397) (41,154)
24,185 18,894
========= =========
In August 2017, the Group signed two granting money agreements, according to which the Group has a liability to grant to unrelated parties interest bearing loans up to BGN 4,000 thousand and up to BGN 500 thousand with 6.7% annual interest and initially arranged term until December 31, 2017, which subsequently was extended to December 31, 2018. In January 2018, pursuant to an annex contracted between the parties, the credit limit on the first loan was increased from BGN 4,000 thousand to BGN 5,000 thousand. As at June 30, 2018 the granted amounts are BGN 4,350 thousand and BGN 500 thousand, respectively.
In November 2017 the Group signed two contracts for granting interest bearing loans with unrelated parties amounting up to BGN 5,050 thousand and up to BGN 6,150 thousand with 6.7% annual interest and term until December 31, 2018. In 2018 the credit limit of the first loan was increased and as at June 30, 2018, the granted amounts under the two loans are BGN 5,314 thousand and BGN 6,150 thousand, respectively.
In December 2017, the Group signed a contract for granting money, which requires the Group to grant interest bearing trade loan up to BGN 3,000 thousand to unrelated party with 6.7% annual interest and term until December 31, 2018. The contracted amount was entirely granted.
In February 2018 the Group granted a short-term cash loan to the unrelated party for BGN 1,500 thousand at an annual interest rate of 6.7%. The loan is due on December 31, 2018. As at June 30, 2018 the receivables under this loan are BGN 1,500 thousand principal and BGN 33 thousand interest.
In March 2018 the Group signed a contract for granting short-term loan with an unrelated party for BGN 1,961 thousand at an annual interest rate of 5.5%. The loan is due on December 31, 2018. As at June 30, 2018 the Group has receivables for BGN 1,961 thousand principal and BGN 28 thousand interest.
In March 2018 the Group signed a contract for granting a short-term cash loan with an unrelated party for BGN 48 thousand at annual interest rate of 6.7%. The loan is due on December 31, 2018. As at June 30, 2018 the granted funds under this loan amounted to BGN 96 thousand principal and BGN 1 thousand interest.
As at June 30, 2018 and December 31, 2017 the receivables on loans granted and interest receivable by the Controlling company until November 2013 at the amount of BGN 32,063 thousand are totally impaired due to started insolvency procedure and their difficult collection.
The Management has performed an analysis of loans granted in order to determine their fair values and their respective level in the fair value hierarchy. The Management of the Group considers that the carrying amounts of the granted loans in the consolidated statement of financial position are reasonable approximations of their fair value as at June 30, 2018 and December 31, 2017 within Level 3 category.
16. Trade and other receivables
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Non-current receivables
Guarantees granted 95 95
--------- ---------
95 95
--------- ---------
Current receivables
Receivables from clients, including 35,353 24,198
Initial value 36,870 25,540
Allowance for impairment (1,517) (1,342)
Receivables under cession agreements, assumption
of debt and regress 6,724 4,550
Initial value 8,128 68,183
Allowance for impairment (1,404) (63,633)
Guarantees for participation in tender procedures 896 886
Deferred expenses 882 1,528
Tax refundable, incl.: 443 50
VAT 442 45
Other taxes 1 5
Advances granted, including 193 329
Initial value 269 405
Allowance for impairment (76) (76)
Litigations and writs 14 189
Initial value 35 210
Allowance for impairment (21) (21)
Other 607 1,003
Initial value 672 1,068
Allowance for impairment (65) (65)
--------- ---------
45,112 32,733
--------- ---------
45,207 32,828
========= =========
The Management performed an analysis of the trade receivables in order to determine their fair values and their level in the fair value hierarchy. The Management considers that the carrying values of the trade and other receivables in the consolidated statement of financial position are reasonable approximations of their fair value as at June 30, 2018 and December 31, 2017 within Level 3 category.
The Group considers that unimpaired overdue receivables are collectible based on historical information about payments, guarantees received and a detailed analysis of the credit risk and collaterals of its customers.
17. Cash and cash equivalents
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Cash in transit 3,354 3,946
Cash at banks 616 3,047
Cash on hand 99 92
--------- ---------
Cash in Statement of Cash Flows 4,069 7,085
--------- ---------
Blocked cash - 186
--------- ---------
Cash in the Statement of Financial Position 4,069 7,271
========= =========
Cash in transit comprises cash collected from fuel stations as at the end of the reporting period, but actually received in the bank accounts of the Group in the beginning of the next reporting period.
The amounts presented as blocked cash as at December 31, 2017 in Cash at the amount of BGN 186 thousand held at a bank account that is blocked as a bank guarantee under a bank loan agreement to serve as a security for a public tender participation of the Parent company under Public Procurement Act. . In the month of April 2018 the amount has been unblocked.
18. Registered capital
The Group's registered capital is presented at its nominal value. The registered capital of the Group represents the registered capital of the Parent company Petrol AD, reduced by redeemed own shares as at June 30, 2018 and December 31, 2017.
As at June 30, 2018 and December 31, 2017 the shareholders in the Parent company are as follows:
Shareholder June 30 Dec. 31
2018 2017
Alfa Capital AD 28.85% 28.85%
Yulinor EOOD 23.11% 23.11%
Perfeto consulting EOOD 16.43% 16.43%
Correct Pharm EOOD 10.98% 10.98%
Trans Express Oil EOOD 9.86% 9.86%
Corporate Commercial Bank AD 5.51% 5.51%
VIP Properties EOOD 2.26% 2.26%
The Ministry of Economy of the Republic
of Bulgaria 0.65% 0.65%
Other minority shareholders 2.35% 2.35%
-------- --------
100.00% 100.00%
======== ========
The Management of the Parent company has undertaken series of measures related to optimization of its capital adequacy. At the several General Meetings of Shareholders hold in the period of 2016 - 2017 a decision for reverse-split procedure for merging 4 old shares with nominal value of BGN 1 to 1 share with a nominal value of BGN 4 and consequent decrease of the capital of the Parent company in order to cover losses by decreasing the nominal value of the shares from BGN 4 to BGN 1 was voted. In March 2018, following a decision of the Lovech Regional Court, which repealed the refusal of the Commercial Register (CR) to register the decision voted on EGMS for merging 4 old shares with nominal of BGN 1 into 1 new share with nominal of BGN 4, the applied change was registered in CR resulting in registered capital of the Parent company of BGN 109 249 612, distributed in 27 312 403 shares with nominal of BGN 4 each. The change in the capital structure of the Parent company was registered also in Central Depositary AD. The application for registration of the voted on EGMS decision for the second stage of the procedure of the Parent company's capital to be decreased by decreasing the nominal value of the shares from BGN 4 to BGN 1 in order to cover losses was refused by CR. The Parent company's Management will undertakes actions for holding a new GMS of Petrol AD to vote again the decision for capital decrease of the Parent company in order to cover losses by decreasing of the nominal value of the share from BGN 4 to BGN 1.
Profit (loss) per share
The profit (loss) per share is calculated by dividing the net loss for the period by the weighted average number of ordinary shares held during the reporting period.
June 30 June 30
2018 2017
Weighted average number of shares 109,250 106,482
Profit (loss) (BGN'000) 55,199 (7,975)
-------- --------
Profit (loss) per share (BGN) 0.51 (0.07)
======== ========
19. Loans and borrowings
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Non-current liabilities
Debenture loans 36,531 36,353
Loans from financial institutions 1,529 1,791
38,060 38,144
========= =========
Current liabilities
Debenture loans 936 1,870
Loans from financial institutions 577 578
Trade loans from unrelated parties 538 1,030
2,051 3,478
========= =========
40,111 41,622
========= =========
19.1. Debenture loans
In October, 2006 the Parent company issued 2,000 registered transferable bonds with fixed annual interest rate of 8.375% and issue value 99.507% of the face value, which is determined at EUR 50,000 per bond. The principal is due in one payment at the maturity date. The bond term is 5 years and the maturity date is in October 2011. At the general meetings of the bondholders conducted in October and December 2011, it was decided to extend the term of the issue until January 26, 2017. On 23 December 2016, a procedure of extension of the bond issue to 2022 and reduction of the interest rate in the range from 5.5% to 8% was successfully completed.
After the prolongation of the debenture loan, the annual effective interest rate is 6.78%. The purpose of the bond issue is to provide funds for working capital, investment projects financing and restructuring of the previous debt of the Group.
The debenture loan liabilities are presented in the statement of financial position at amortised cost.
As at the date of these financial statements the nominal value of the debenture loan is EUR 18,659 thousand.
19.2. Loans from financial institutions
In July 2016 the Group entered into an investment loan agreement, prepaying the liabilities on finance lease contract from November 2015. Collateral of the loan is mortgage of property, acquired through finance lease and pledge of receivables. The term of the contract is May 2022 and the contracted interest rate is 3mEuribor+5.25%.
20. Obligation for defined benefit retirement compensations
As at June 30, 2018 and December 31, 2017 the Group accrued obligation for defined benefit retirement compensations amounting to BGN 441 thousand. The amount of the liability is determined based on an actuarial valuation, based on assumptions for mortality, disability, employment turnover, salary increases, etc. The present value of the liability is calculated using a discount factor of 2% and expected salary increases 4%.
The demographic assumptions are related to the likelihood individuals to leave the plan before retirement due to various reasons: withdrawal, staff reduction, illness, death, disability, etc. They are based on statistical information about the population and are attached to the staff structure by gender and age at the time of the assessment.
21. Trade and other payables
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Payables to suppliers 52,187 40,817
Obligations under cession agreements and
regress 12,813 39,942
Tax payables, including 7,484 6,005
Excise duty and other taxes 7,424 5,922
VAT 60 83
Payables to personnel and social security
funds 2,133 2,140
Advances received and deferred income 474 2,108
Payables to related parties 12 -
Other 961 998
--------- ---------
76,064 92,010
========= =========
The Group accrues unused paid leave provision of employees in compliance with IAS 19 Employee Benefits. The movement of these provisions for the period is as follows:
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Balance at the beginning of the period 429 359
Accrued during the period 315 372
Utilised during the period (239) (302)
Balance at the end of the period, including: 505 429
========= =========
Paid leaves 425 362
Social security on paid leaves 80 67
The balance at the end of the year is presented in the consolidated statement of financial position together with current payable to personnel.
The Management performed an analysis of trade payables in order to determine their fair values and their level in the fair value hierarchy. The Management of the Group considers that the carrying amounts of the current payables in the consolidated statement of financial position are reasonable approximations of their fair value as at June 30, 2018 and December 31, 2017 within Level 3 category.
22. Current income tax
June 30 Dec. 31
2018 2017
BGN'000 BGN'000
Income tax payable (receivable) at the beginning
of the period 56 368
Corporate income tax accrued - 44
Corporate income tax paid (56) (285)
Disposals on business combinations - (70)
Other variations incl. corporate income
tax offset - (1)
--------- ---------
Refundable corporate income tax at the end
of the period - 56
========= =========
23. Subsidiaries
The Parent company (the Controlling company) is Petrol AD.
The subsidiaries, included in the consolidation, over which the Group has control as of June 30, 2018 and December 31, 2017 are as follows:
Subsidiary Main activity Investment Investment
at June at Dec.
30 2018 31 2017
Petrol Properties Trading movable and immovable
EOOD property 100% 100%
Varna Storage Trade with oil and oil
EOOD products 100% 100%
Petrol Finances Financial and accounting
OOD services 99% 99%
Petrol Finance Financial and accounting
EOOD services 100% 100%
Elit Petrol -Lovech Trade with oil and oil
AD products 100% 100%
Petrol Technologies
OOD IT services and consultancy 98,80% 98,80%
Acquisition, management
Lozen Asset AD and exploitation of property 100% 100%
Production and trading
with goods and services,
Storage Invest investments, intermediation
EOOD services 100% 100%
Processing and trading
Storage Oil EAD with oil and oil products 100% 100%
Management, leasing and
Elit Petrol AD sale of real estate - 100%
In March 2018 the Group sold 100% of the capital of Elit Petrol AD for BGN 25 thousand. As at the transaction date Elit Petrol AD is sole owner of the capital of Varna Storage EOOD. The consolidated net assets of the two companies are negative amounting to BGN 54,596 thousand. The result of the sale is a profit of BGN 54,621 thousand.
In March 2018 the Group signed a contract for purchasing of 1,873,700 shares, representing 100% of the capital of Varna Storage EOOD. The price of BGN 6,500 thousand was determined by a market valuation, accepted by both parties and was offset with the opposite receivables of the Group from the seller. The goodwill recognised arising from the acquisition amounted to BGN 19,787 thousand.
In November 2017, the Group sold 100% of its interest in Gryphon Power AD to third party for BGN 21,800 thousand consideration. As at the transaction date, the consolidated net assets of the sold company were at the amount of BGN 10,891 thousand. As a result of the sale, the Group reported BGN 10,909 thousand profit.
In December 2017, the Group sold 100% of the capital in BPI AD for BGN 4 thousand. As at the transaction date the consolidated net assets are negative at the amount of BGN 1,087 thousand and the result of the sale is a profit of BGN 1,091 thousand.
In December 2017, the Group sold to third party 100% of the capital of Petrol Gas EOOD for BGN 2 thousand. As at the transaction date the consolidated net assets are at the amount of BGN 10 thousand. The result from the sale is a loss of BGN 8 thousand.
During the period until June 30, 2018 the Group has no purchases and sales with related parties.
The total amount of the accrued remunerations of the members of Management Board and Supervisory Board of the Parent company for the period until June 30, 2018, included in the personnel expenses, is BGN 665 thousand (June 30, 2017: BGN 648 thousand), and the unsettled liabilities as at June 30, 2018 are at the amount of BGN 96 thousand (December 31, 2017: BGN 89 thousand).
24. Contingent liabilities
As at June 30, 2018 the Group has contingent liabilities, including issued mortgages and pledges of property, plant and equipment, which serve as a collateral for the bank loans granted to the Group and unrelated parties and credit limits for issuance of bank guarantees with total carrying amount of BGN 7,530 thousand. The Group is a joint co-debtor under a loan agreement for BGN 35,000 thousand and stand-by credit for issuance of bank guarantees amounted to BGN 10,000 thousand in favor of unrelated supplier. The total amount of the utilized funds and issued valid bank guarantees of all borrower's exposures to the Bank shall not exceed BGN 45,000 thousand. The Group has contingent liability, which secured the execution of the contract for storage of third-party fuels amounted to BGN 30,000 thousand.
The Group has co-debtor liability of BGN 2,346 thousand, pursuant to entering-into-debt agreement from January 2017 under liability of subsidiary till February 2018.
Under a bank agreement for revolving credit line concluded in 2016, bank guarantees were issued for a total amount as at June 30, 2018 of BGN 9,304 thousand, including BGN 5,900 thousand in favor of third parties - Group's suppliers, BGN 1,244 thousand in favor of National Revenue Agency, for issuance of appealed by the Parent company revision acts and BGN 2,160 thousand to secure own liabilities related to contracts under the Public Procurement Act. The bank agreement is secured by mortgage and pledge of property, pledge of all receivables on bank accounts (at the amount of BGN 209 thousand as at June 30, 2018) of the Parent company and a subsidiary. In July 2017 the credit limit under the revolving credit line was increased from BGN 8,500 thousand to BGN 9,500 thousand. Assets amounted to BGN 1,500 thousand, owned by a subsidiary, additionally secured the credit limit.
As a collateral of an investment loan signed in July 2016, a mortgage of property, acquired through the investment loan and a pledge of receivables, arising from opened bank accounts of the Parent company to the amount of the outstanding balance of the loan, which as at the June 30, 2018 amounting to BGN 2,097 thousand.
There is a pending court dispute in relation to a singed in 2015 written guarantee of liabilities of a subsidiary until February 2018, arising from a cession agreement with an exposure of BGN 245 thousand as at 30 June, 2018. The blocked cash of BGN 245 thousand, which served as a collateral pursuant to Art.180 and Art. 181 of the Obligations and Contracts Act (OCA), is reported as other receivables on guarantees. A claim to release the cash was deposited, but the court has dismissed it.
In the previous reporting periods companies from the Group have entered into the debt under two loan agreements of a subsidiary (until December 2015) for USD 15,000 thousand and USD 20,000 thousand, respectively. In 2015 the bank -creditor acquired court orders for immediate execution and receiving orders against the subsidiaries - joint debtors. In relation to the complaints filed by the subsidiaries, the competent court has revoked the immediate enforcement orders and has invalidated the receiving orders. In October and December 2015 the creditor has filed claims under Art. 422 of Civil Procedure Code (CPC) against the subsidiaries for the existence of the receivables under each loan agreement. The court proceedings of the creditor are still pending.
In December 2016 the first instance court decreed a decision (the Decision) which admit for established that the bank has a receivable amounted to USD 15,527 thousand from the subsidiaries - joint debtors, arising from a signed loan agreement for USD 15,000 thousand. With the same decision the court has ordered the subsidiaries jointly to pay BGN 411 thousand to the bank - creditor for legal fees and expenses and BGN 538 thousand state fee in favor of the judiciary state for the ordered proceedings and BGN 538 thousand state fee for claim proceedings. In January 2017 the subsidiaries have filed in time appeals against the court decision, because of that the decision did not come into force. As at the date of preparation of these consolidated financial statements the dispute is pending before the court of appeal and the Group's Management considers that there are reasonable grounds the decision to be fully canceled.
As at the date of the preparation of these consolidated financial statements, the filed proceedings against the subsidiaries - joint debtors for estimation of the bank receivables due to the loan agreement for USD 20,000 thousand is pending before the first-instance court. The Management expects favorable decision by the competent court. As at the date of the preparation of this financial report the Parent company sold its interest in one of co-debtor subsidiaries and the potential risk for the Group is reduced to the court proceedings against the second subsidiary.
A creditor of a subsidiary (until December 2015) unreasonably claimed in court the responsibility of the Parent company under a contract of guarantee for liabilities arising from a contract for a framework credit limit as a result of that the bank accounts of the Parent company amounting to USD 29,983 thousand were garnished. This claim was disputed in court by Petrol AD because the liability as guarantor has not occurred and / or extinguished pursuant to Art. 147, paragraph 2 of the Obligations and Contracts Act (OCA). At the time of conclusion of the guarantee deadline of the arrangements between the lender and subsidiary contractual framework for credit limit was July 1, 2014. The term of the framework credit limit was extended without the consent of the customer, therefore the responsibility of the latter has fallen by six months after initially agreed period, during which the creditor has brought an action against the principal debtor. The term of Art. 147, paragraph 1 of the Obligations and Contracts Act (OCA) is final and upon its expiration the company's guarantee has been terminated, so the objection of the Parent company was granted by the court and imposed liens on bank accounts lifted.
After the writ of execution, pursuant to order proceedings, was canceled on which were imposed liens on bank accounts of the Parent company, the creditor has initiated legal claim proceedings under Art. 422 of the Civil Procedure Code (CPC) to establish the same claims against the subsidiary (until December 2015) and the guarantor Petrol AD. In these proceedings the objections are repeated, that liability as guarantor has not occurred and / or extinguished pursuant to Art. 147, par. 2 of the OCA, and therefore the Management expects that the claim of the creditor against the Parent company will be dismissed permanently by a court decision on those cases. At present, the claim proceedings are pending.
25. Events after the reporting date
At the date of these interim consolidated financial statements there are no significant events after the reporting period, which to require additional disclosures or adjustments in the financial reports.
Georgi Tatarski Milko Dimitrov Prepared by Elena Pavlova - Executive Director Executive Director Teofanova
August 29, 2018
[1] EBITDA (earnings before interest, tax, depreciation and amortization)
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END
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