30 Sep 2015 07:00
Treveria plc
("Treveria", the "Group" or the "Company")
Interim Results for the six months ended 30 June 2015
Treveria plc (AIM: TRV), the German retail focused real estate investment company, today announces its Interim Results for the six months ended 30 June 2015, which will shortly be available on the Company's website www.treveria.com.
For further information, please contact:
FIM Capital Limited | |
Graham Smith | +44 (0) 1624 681250 |
N+1 Singer | |
James MaxwellRichard Salmond | +44 (0) 20 7496 3000 |
Introduction
As announced on 3 September 2015, the Company reached an important milestone, namely the disposal of its two wholly owned subsidiaries through which the Group's portfolio was owned and managed. The Company has therefore now realised all its investments, and intends to distribute all its cash (net of final expenses) to shareholders as soon as reasonably possible.
To that end we are today also issuing a circular to shareholders with a notice of an Extraordinary General Meeting at which shareholders are asked to approve changes to the Company's legal form which are necessary for the share capital to be made distributable. The changes will also enable the Company to pursue alternatives to a voluntary liquidation which should provide a small additional benefit to shareholders. Today's circular gives further details about the proposed distribution.
We were also able to announce on that date that the legal proceedings between Treveria and two of its former professional advisers relating to German Real Estate Transfer Tax had been concluded on mutually acceptable terms.
Financial results
The Consolidated Statement of Comprehensive Income includes the results of the subsidiaries for the full six months. However, the subsidiaries are treated as "an asset held for sale" in accordance with IFRS5 at the balance sheet date, instead of consolidating their assets and liabilities into a group balance sheet. Accordingly, the subsidiaries are fair valued at an amount equivalent to the net disposal proceeds received after the reporting date as a result of the sale.
We report a loss for the period of €7,903,000 (compared with a loss in the previous year of €8,300,000), which equates to a loss of 1.31 Eurocents per share, (compared with a loss in the previous year of 1.37 Eurocents per share). Consequently, total net assets fell from €30,657,000 at 31 December 2014 to €22,754,000 at 30 June 2015. This equals a movement from 5.07 Eurocents per share to 3.76 Eurocents per share.
Outlook
Discussions have taken place with a number of parties interested in retaining the admission of Ordinary Shares to trading on AIM and utilising the Company for other business activities, with a view to affording all Shareholders a means of maintaining a modest investment in the on-going Group or to exit entirely, as they should decide. The circular being issued today gives details of changes needed to enable such a development. It also outlines how the Company intends to distribute cash to shareholders equivalent to its entire net assets. We therefore ask that shareholders give it their attention and vote to approve the resolutions.
Graham Smith
Non-executive director
29 September 2015
Condensed consolidated statement of comprehensive income
for the six months ended 30 June 2015
Period ended | Period ended | Year ended | ||
30 June | 30 June | 31 Dec | ||
2015 | 2014 | 2014 | ||
Notes | €'000 | €'000 | €'000 | |
Gross rental income | 972 | 1,311 | 2,511 | |
Direct costs | 5 | (1,084) | (1,570) | (3,025) |
Net rental loss | (112) | (259) | (514) | |
Bad debts | (192) | (1,088) | (943) | |
Loss from disposal of investment properties | 4 | (164) | - | (577) |
Deficit on revaluation of investment properties | 11 | (23) | (320) | (1,515) |
Deficit on revaluation of investments at fair value through profit and loss | 10 | (2,913) | - | (3,137) |
Deficit from reclassification of investments as assets held for sale | 13 | (2,896) | - | - |
Other income | - | 471 | 1,249 | |
Administrative expenses | 5 | (1,647) | (1,208) | (2,522) |
Operating loss | (7,947) | (2,404) | (7,959) | |
Finance revenue | 6 | 38 | 61 | 1 |
Finance expense | 6 | (27) | (7) | (97) |
Loss before tax | (7,936) | (2,350) | (8,055) | |
Income tax credit/(expense) | 7 | 33 | (131) | (238) |
Loss for the period | (7,903) | (2,481) | (8,293) | |
Loss attributable to: | ||||
Equity holders of the parent company | - | - | - | |
Loss for the period | (7,903) | (2,481) | (8,293) | |
Other comprehensive income | ||||
Foreign exchange translation differences | - | (47) | (7) | |
Other comprehensive loss for the period | - | (47) | (7) | |
Total comprehensive loss for the period | (7,903) | (2,528) | (8,300) | |
Total comprehensive loss attributable to: | ||||
Equity holders of the parent company | (7,903) | (2,528) | (8,300) | |
Non-controlling interests | - | - | - | |
Total comprehensive loss for the period | (7,903) | (2,528) | (8,300) |
Loss per share
Basic loss for the period attributable to ordinary equity holders of the parent company | 8 | (1.31)c | (0.41)c | (1.37)c |
Diluted loss for the period attributable to ordinary equity holders of the parent company | 8 | (1.31)c | (0.41)c | (1.37)c |
Condensed consolidated statement of financial position
as at 30 June 2015
30 June | 30 June | 31 Dec | ||
2015 | 2014 | 2014 | ||
Notes | €'000 | €'000 | €'000 | |
Non-current assets | ||||
Investment at fair value through profit and loss | 10 | - | 13,000 | 8,300 |
Investment property held for disposal | 11 | - | 32,899 | 6,870 |
Total non-current assets | - | 45,899 | 15,170 | |
Current assets | ||||
Assets held for sale and associated liabilities | 13 | 22,689 | - | - |
Trade and other receivables | 26 | 1,044 | 11,751 | |
Prepayments | 14 | 765 | 649 | |
Cash and short-term deposits | 12 | 210 | 14,886 | 5,881 |
Total current assets | 22,939 | 16,695 | 18,281 | |
Total assets | 22,939 | 62,594 | 33,451 | |
Current liabilities | ||||
Trade and other payables | 185 | 2,051 | 1,519 | |
Provision for RETT | - | 1,000 | 1,000 | |
Finance lease obligations | - | 1,557 | - | |
Current tax liabilities | - | 68 | 50 | |
Total current liabilities | 185 | 4,676 | 2,569 | |
Non-current liabilities | ||||
Finance lease obligations | - | 12,152 | - | |
Deferred tax liabilities | - | 262 | 225 | |
Total non-current liabilities | - | 12,414 | 225 | |
Total liabilities | 185 | 17,090 | 2,794 | |
Net assets | 22,754 | 45,504 | 30,657 | |
Equity | ||||
Issued capital | 6,050 | 6,050 | 6,050 | |
Capital redemption reserve | 1,109 | 1,109 | 1,109 | |
Retained earnings and other distributable reserve | 15,595 | 38,345 | 23,498 | |
Total equity | 22,754 | 45,504 | 30,657 |
Condensed consolidated statement of changes in equity
for the six months ended 30 June 2015
Issued | Capital | Retained | Total | |
capital | redemption | earnings | equity | |
reserve | and other | |||
distributable | ||||
reserve | ||||
€'000 | €'000 | €'000 | €'000 | |
As at 1 January 2014 | 6,050 | 1,109 | 40,873 | 48,032 |
Period 1 January 2014 to 30 June 2014 | ||||
Total comprehensive income | ||||
Loss for the period | - | - | (2,481) | (2,481) |
Other comprehensive income | - | - | (47) | (47) |
Total comprehensive income | - | - | (2,528) | (2,528) |
Balance as at 30 June 2014 | 6,050 | 1,109 | 38,345 | 45,504 |
Period 1 July 2014 to 31 December 2014 | ||||
Total comprehensive income | ||||
Loss from 1 July 2014 to 31 December 2014 | - | - | (5,812) | (5,812) |
Other comprehensive income | - | - | 40 | 40 |
Total comprehensive income | - | - | (5,772) | (5,772) |
Contributions by and distributions to equity holders | ||||
Distributions | - | - | (9,075) | (9,075) |
Balance as at 31 December 2014 | 6,050 | 1,109 | 23,498 | 30,657 |
Period 1 January 2015 to 30 June 2015 | ||||
Total comprehensive income | ||||
Loss for the period | - | - | (7,903) | (7,903) |
Total comprehensive income | - | - | (7,903) | (7,903) |
Balance as at 30 June 2015 | 6,050 | 1,109 | 15,595 | 22,754 |
Condensed consolidated statement of cash flows
for the six months ended 30 June 2015
Period ended | Period ended | Year ended | ||
30 June | 30 June | 31 Dec | ||
2015 | 2014 | 2014 | ||
Notes | €'000 | €'000 | €'000 | |
Operating activities | ||||
Loss before tax | (7,936) | (2,350) | (8,055) | |
Loss from disposal of investment properties | 4 | 164 | - | 577 |
Deficit on revaluation of investment properties | 11 | 23 | 320 | 1,515 |
Deficit on revaluation of investments at fair value through profit and loss | 2,913 | - | 3,137 | |
Loss from reclassification of investments as assets held for sale | 2,896 | - | - | |
Finance revenue | 6 | (38) | - | (1) |
Finance expense | 6 | 27 | 7 | 97 |
Net cash flows from operations before changes in working capital | (1,951) | (2,023) | (2,730) | |
Changes in working capital | ||||
(Increase)/decrease in trade and other receivables | 353 | 1,734 | 635 | |
(Decrease)/increase in trade and other payables | 526 | (785) | (1,279) | |
Income tax paid | (84) | (1,624) | (1,786) | |
Net cash flows from operating activities | (1,156) | (2,698) | (5,160) | |
Investing activities | ||||
Proceeds from disposal of investments at fair value through profit and loss | 1,295 | 2,500 | 2,955 | |
Proceeds from disposal of investment properties | 11,047 | 1,800 | 3,966 | |
Finance revenue received | - | - | 1 | |
Effects on cash held in subsidiaries held for sale | 13 | (16,830) | - | - |
Net cash flows from investing activities | (4,488) | 4,300 | 6,922 | |
Financing activities | ||||
Distribution | - | - | (9,075) | |
Repayment of loans | - | - | - | |
Finance expense paid | (27) | (7) | (97) | |
Net cash flows from financing activities | (27) | (7) | (9,172) | |
Net increase/(decrease) in cash and cash equivalents | (5,671) | 1,595 | (7,410) | |
Cash and short-term deposits as at 1 January | 5,881 | 13,291 | 13,291 | |
Cash and short-term deposits at period end | 210 | 14,886 | 5,881 |
Notes to the consolidated financial statements
for the six months ended 30 June 2015
1. General information
Treveria plc (the Company) is a company incorporated and domiciled in the Isle of Man whose shares are publicly traded on AIM.
The consolidated financial statements of Treveria plc comprise the Company and its subsidiaries (together referred to as the Group). The Company acts as the investment holding company of the Group.
2. Significant accounting policies and basis of preparation
These condensed consolidated interim financial statements are unaudited, have not been reviewed by the auditors, and do not constitute statutory accounts. The statutory accounts for 2014, which received an unqualified report from the auditors, are available on the Company's website, www.treveria.com.
The accounting policies adopted by the Group in these condensed consolidated interim financial statements are consistent with those followed in the preparation of the Group's annual consolidated financial statements as at, and for the year ended, 31 December 2014. The consolidated financial statements have been prepared on the historical cost basis except that assets held for sale are measured at realisable value in accordance with IFRS5. On 3 September 2015 the Company announced it had sold its two wholly owned subsidiaries - Treveria Asset Management Limited and Treveria Holdings Limited to Haflinger Invest Limited and Phylira NV, and accordingly these subsidiaries are treated as assets held for sale at 30 June 2015.
After the distribution of cash generated by this sale the Company is expected to be wound up. This constitutes an adjusting post-balance sheet event and as such the financial statements have been presented on a non-going concern basis. The assets of the Group have been stated at realisable value.
Amendments resulting from improvements to IFRSs and their interpretations did not have any impact on the accounting policies, financial position or performance of the Group. The Group has not early adopted any other standard, interpretation or amendment which was issued and is not yet effective.
3. Segmental reporting
The Directors are of the opinion that the Group is engaged in a single segment of business, being property investment business, in one geographical area, namely Germany. This is consistent with the internal reporting provided to the Board who act chief operating decision-makers and are responsible for allocating resources and assessing performance. Accordingly the Directors consider it no longer appropriate or necessary to report on the results of each Silo.
4. Loss from disposal of investment properties
Period ended | Period ended | Year ended | |
30 June | 30 June | 31 December | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Gross disposal proceeds | 1,800 | 1,800 | 13,350 |
Book value of properties disposed | (1,827) | (1,800) | (13,340) |
Other disposal costs | (137) | - | (587) |
(164) | - | (577) |
5. Operating loss
The following items have been charged/(credited) in arriving at operating profit/(loss):
Direct costs | |||
Period ended | Period ended | Year ended | |
30 June | 30 June | 31 Dec | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Service charge expense | 497 | 607 | 1,075 |
Service charge income | (212) | (60) | (191) |
Irrecoverable service charges | 285 | 547 | 884 |
Property management fee | - | 58 | - |
Asset Management fee | 73 | - | 102 |
Ground rent / lease charges | 613 | 1,020 | 1,809 |
Other property costs | 113 | (55) | 230 |
1,084 | 1,570 | 3,025 |
Administrative expenses | |||
Period ended | Period ended | Year ended | |
30 June | 30 June | 31 Dec | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Audit fees | 11 | 42 | 41 |
Directors' fees | 18 | 18 | 35 |
Directors' expenses | 23 | 18 | 36 |
Legal and professional fees and other administrative costs | 1,595 | 1,130 | 2,410 |
1,647 | 1,208 | 2,522 |
6. Finance revenue and expense
Period ended | Period ended | Year ended | |
30 June | 30 June | 31 December | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Net foreign exchange gain | 38 | 61 | - |
Finance revenue | 38 | 61 | 1 |
| |||
Amortisation of capitalised finance charges | - | (1) | (6) |
Net foreign exchange loss | - | - | - |
Interest on back taxes and other | (27) | (6) | (91) |
Finance expense | (27) | (7) | (97) |
Net finance (expense)/ income | 11 | 54 | (96) |
7. Taxation
Period ended | Period ended | Year ended | |
30 June | 30 June | 31 December | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Income tax | |||
Current income tax charge | 75 | 169 | 312 |
Deferred tax | (108) | (38) | (74) |
Income tax (credit) /expense reported in the Statement of Comprehensive Income | (33) | 131 | 238 |
Tax reconciliation | |||
Opening balance | - | 1,523 | 1,523 |
Tax charge/(credit) | 75 | 169 | 312 |
Tax paid | (35) | (1,624) | (1,785) |
Derecognition of subsidiaries | - | - | - |
Closing current tax liabilities | 40 | 68 | 50 |
8. Loss per share
The calculation of the basic, diluted and adjusted loss per share is based on the following data:
Period ended | Period ended | Year ended | |
30 June | 30 June | 31 December | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Earnings | |||
Loss for the period attributable to the equity holders | (7,903) | (2,481) | (8,293) |
Number of shares | |||
Weighted average number of ordinary shares for the purpose of basic earnings per share | 605,008,809 | 605,008,809 | 605,008,809 |
Basic loss per share | (1.31)c | (0.41)c | (1.37)c |
Diluted loss per share | (1.31)c | (0.41)c | (1.37)c |
9. Net assets per share
30 June | 30 June | 31 December | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Net assets | |||
Net assets for the purpose of assets attributable to the equity holders | 22,754 | 45,504 | 30,657 |
Number of shares | |||
Number of ordinary shares for the purpose of net assets per share | 605,008,809 | 605,008,809 | 605,008,809 |
Net assets per share | 3.76c | 7.52c | 5.07c |
10. Investment at fair value through profit and loss
30 June | 30 June | 31 Dec | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Financial assets at fair value through profit or loss | |||
Unlisted private equity investments (level 3) | - | 13,000 | 15,550 |
Total investments | - | 13,000 | 15,500 |
The following table shows a reconciliation of the opening balances to the closing balances for fair value measurements.
30 June | 30 June | 31 Dec | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Balance at 1 January | 8,300 | 15,500 | 15,500 |
Disposal | (187) | (2,500) | (4,063) |
Deficit on revaluation of investments at fair value through profit and loss | (2,913) | - | (3,137) |
Reclassification of investments as assets held for sale (note 13) | (5,200) | - | - |
Balance at period end | - | 13,000 | 8,300 |
IFRS 13, Fair Value Measurement requires disclosure, by class of financial instrument, if the effect of changing one or more inputs to reasonably possible alternative assumptions would result in a significant change to the fair value measurement. The information used in determination of the fair value of Level 3 investments is chosen with reference to the specific underlying circumstances and position of the investee company. On that basis, the Board believes that the impact of changing one or more of the inputs to reasonably possible alternative assumptions would not change the fair value significantly.
Financial instruments not measured at fair value
The carrying value of short-term financial assets and financial liabilities (cash, debtors and creditors) approximate their fair value.
11. Investment property held for disposal
30 June | 30 June | 31 Dec | |
2015 | 2014 | 2014 | |
€'000 | €'000 | €'000 | |
Balance at 1 January | 6,870 | 21,330 | 21,330 |
Additions and subsequent expenditure | - | - | 415 |
Disposal | (1,827) | (1,800) | (13,340) |
Deficit on revaluation of investment properties | (23) | (320) | (1,515) |
Adjustment in respect of minimum payments under head leases | - | 13,709 | - |
Reclassification of investments as assets held for sale (see note 13) | (5,020) | - | - |
Other adjustments | - | (20) | (20) |
Balance at period end | - | 32,899 | 6,870 |
12. Cash and short-term deposits
30 June | 30 June | 31 December | |
2015 | 2014 | 2014 | |
€ 000 | € 000 | € 000 | |
Cash at banks and in hand (see note 13) | 210 | 14,886 | 5,881 |
13. Assets held for sale and associated liabilities
30 June | |
2015 | |
€'000 | |
Assets | |
Investment at fair value through profit and loss | 5,200 |
Investment property held for disposal | 5,020 |
Trade and other receivables | 806 |
Prepayments | 709 |
Cash and short-term deposits | 16,830 |
Total | 28,565 |
Liabilities | |
Trade and other payables | (1,822) |
Provision for RETT | (1,000) |
Current tax liabilities | (40) |
Deferred tax liabilities | (118) |
Total | (2,980) |
Net Assets | 25,585 |
Loss from reclassification of investments as assets held for sale | (2,896) |
Net assets held for sale and associated liabilities | 22,689 |
14. Events after the date of the consolidated statement of financial position
Eitan Milgram, former Chairman of the Company, resigned from the Board on 26 August 2015.
On 3 September 2015, the Company sold its two wholly owned subsidiaries - Treveria Asset Management Limited ("TAML") and Treveria Holdings Limited ("Holdings") - to Haflinger Invest Limited ("Haflinger") and Phylira NV ("Phylira"). Haflinger is a company owned by a group of investors, among them Richmond Invest GmbH and Richmond Invest BV, in which David Malpica, a director of the Company, holds a beneficial interest. The sale was therefore a transaction with a related party of the Company. Treveria has received sale proceeds of approximately €17 million in cash as a result of the sale.
As detailed in prior year annual reports, the Company had initiated legal proceedings against two of its former professional advisers relating to German Real Estate Transfer Tax. On 3 September 2015, the Company announced that the legal proceedings between Treveria and the defendants had been concluded on mutually acceptable terms, which will remain confidential between the parties.