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Dana Group International Investments: Final Results for the Year Ended 30th June 2018

Tue 27th November, 2018 7:00am
Dana Group International Investments Limited and its subsidiaries
(the “Group” or  the “Company”)
Consolidated Financial Results for the Year Ended 30(th) June 2018

Chairman’s Statement

On behalf of the Board of Directors, I am pleased to present the Group’s
consolidated, audited financial statements for the financial year ended 30(th)
June 2018 together with the notes thereto.

The period under review was challenging for the regional economy owing to the
macroeconomic, structural and geopolitical influences across the region. These
factors, along with supply and demand trend, have softened the real estate
sector in the United Arab Emirates (UAE). Despite such challenges, the UAE’s
real estate sector is maturing and the Directors believe it is poised for
growth in the longer term, following the flurry of business-friendly reforms
in recent months, improved regulations, solid macroeconomic fundamentals,
transparency and highly developed infrastructure.

While the external environment may provide constant challenges, the Directors
perceive that the gradual recovery of oil prices and the diversification of
the economy will encourage more foreign direct investments in the region.
Business-friendly policy reforms supporting the building of a sustained and
integrated economy should pave the way towards increased business activities
and confidence across all sectors, including real estate.

Meanwhile, the UAE is preparing for Expo 2020, which will be hosted by the
Emirate of Dubai, and is progressing well with numerous initiatives to become
a global hub for the development and deployment of new technologies such as
Artificial Intelligence, Fintech, 3D printing etc. This should enhance the
UAE’s prestige and support the core real estate, transport and tourism
sectors. In turn, this should provide an opportunity for the Company to
develop a well-focused and diversified investment strategy in the real estate
sector.

Board Changes

During the year under review, Mr. Khaled (Nicholas) Majdalani stepped down
from the Board and the following new Directors were admitted:
* Mr. Ahmad Abdulla Aljaziri Altamimi - Director
* Mr. Mustafa Saifuddin - Director and CEO
* Mr. Khaled Moh’d Ahmad Owaidat - Director
Financial Results

The comprehensive loss for the financial year ended 30(th) June 2018 was USD
33.92 million (2017: comprehensive income of USD 8.14 million) and the net
loss for the year was USD 3,567 (2017: net loss of USD 215,329), giving rise
to a basic loss per share of 0.001 US cents (2017: basic loss per share of
0.086 US cents).

The Company has posted the revenue of USD 108,000 from consultancy services.
The net loss for the year reduced by USD 211,762 from the comparable period.
This reduction was attributable to reduced operational costs during the year
under review.

As at 30(th) June 2018, the Company’s net assets standing at USD 51.90
million (2017: USD 85.82 million); or US cents 21 per share (2017: US cents 34
per share).

The decrease in the Group's net assets by USD 33.92 million or 40 per cent is
attributable to fair value changes as measured at the year-end in the value of
investments held by Bonyan International Investment Group (Holding) LLC
(“Bonyan”), in which the Company holds a 21.68 per cent interest.

The change in fair value arose mainly from over-supply and softening demand in
the real estate sector in the UAE, marked by the declines in real property
asset prices and values of real property assets of between 10 and 15 per cent
on average during the year under review.  

During financial year 2017-2018, an investee company (the “Investee
Company” as defined in the Directors’ Report in the Annual Report for the
financial year 2017-2018) of Bonyan underwent capital restructuring which
resulted in the dilution of Bonyan’s shareholding in the Investee Company to
19.68 per cent (30 June 2017: 40 per cent). The dilution arose from the issue
of new share capital by the Investee Company to incoming shareholders.

Further information on this and on the Post- Balance Sheet Event discussed
below is provided in the Directors’ Report appearing in the Group’s Annual
Report.

Post-Balance Sheet Events  
Subsequent to the end of the last financial year, the shares of Bonyan’s
Investee Company were listed on the ADX Secondary Market in Abu Dhabi. The
listing provides a continuous, independent pricing and valuation mechanism for
Bonyan’s significant investment within a stable regulatory environment which
enforces high standards of disclosure and transparency. The Directors’
Report explains how, since the listing, this has affected the valuation of the
Company’s indirect exposure, through its investment in Bonyan, to Bonyan’s
Investee Company’s shares.

Further, Mr. Muin El-Saleh retires by rotation and has decided not to offer
himself for re-election, owing to his external commitments. Muin was appointed
as the CEO & Executive director of the Company in July 2011 and had stepped
down from the CEO position in December 2017. Muin has played a key role on
matters concerned with corporate development. He has also been the motivating
force behind implementing an improved financial reporting and IT support
system in the Group. The Board would like to thank Mr. Muin for his
significant contribution and service to the Company.

Current Trading       
Trading from 1(st) July 2018 to date remains consistent with the Directors’
expectations at the beginning of the current financial period.

Recommendation     
The Directors believe that all the proposals to be considered at the AGM,
notice of which will be posted with the Annual Report, are in the best
interests of the Company and recommend shareholders to vote in favour of them
as they intend, where relevant, to do in respect of their own beneficial
shareholdings.

Conclusion    
The restructuring of Bonyan’s investment should benefit the Group as
prospects of expansion and the involvement in distinguished and unique
projects in the field of real estate development and other various areas of
investments should increase returns from sustainable sources; these are
expected to improve the Company’s overall value. As the current financial
year progresses, the Directors will remain dedicated to exploring and grasping
opportunities for further business development.

Finally, I would like to extend my wholehearted gratitude to my fellow members
of the Board and to our valued shareholders who continue to place their trust
in us. On behalf of the Board, we pledge to continue doing our best to achieve
success.
 

Firas Baba                 
Chairman,                 
Dubai, 26 November 2018

Consolidated statement of profit or loss and other comprehensive income
for the year ended 30(th) June 2018

                                                                                          30 June 2018              30 June 2017 
                                                                       Notes                       USD                       USD 
 Revenue                                                                                       108,047                   190,395 
                                                                                         -------------            -------------- 
 Employee costs                                                                              (146,464)                 (418,522) 
 Other operating expenses                                                                     (90,233)                 (117,990) 
 Legal and professional expenses                                                              (94,753)                  (94,132) 
 Depreciation                                                                                    (702)                   (4,444) 
 Other income                                                                    222,228  ------------    202,439 -------------- 
 Operating loss                                                                                (1,877)                 (242,254) 
 Finance (expense)/income                                                      (1,690)  --------------     26,925 -------------- 
 Loss for the year                                                             (3,567)  --------------  (215,329) -------------- 
 Other comprehensive income                                                                                                      
 Items that are or may be reclassified subsequently to profit or loss                                                            
 Fair value changes in available for sale financial assets                  2             (33,916,203)                 8,354,786 
                                                                                              ________                  ________ 
 Total comprehensive (loss)/income for the year                                  (33,919,770) ========        8,139,457 ======== 

   

 Loss per share attributable to the owners of the parent during the year                           
 Basic loss per share for the year                                         1  (0.00001)  (0.00086) 
                                                                                 ======     ====== 

Consolidated statement of financial position
as at 30(th) June 2018

                                                                              30 June 2018                  30 June 2017 
                                                      Notes                            USD                           USD 
 ASSETS                                                                                                                  
 Non-current assets                                                                                                      
 Property and equipment                                                                  -                           702 
 Available for sale financial assets                      2                     52,620,087                    86,536,290 
                                                                           ---------------              ---------------- 
 Total non-current assets                                                       52,620,087                    86,536,992 
                                                                           ---------------              ---------------- 
 Current assets                                                                                                          
 Loans and advances                                                                      -                     4,700,000 
 Prepayments, advances and other receivables                                        42,054                       541,140 
 Cash and cash equivalents                                         14,481  ---------------        42,531 --------------- 
 Total current assets                                              56,535  ---------------     5,283,671 --------------- 
 Total assets                                                          52,676,622 ========           91,820,663 ======== 
 LIABILITIES AND SHAREHOLDERS’ EQUITY                                                                                    
 Share capital                                            3                      2,010,490                     2,010,490 
 Share premium                                                                  83,862,586                    83,862,586 
 Available for sale fair valuation reserve                                    (25,561,417)                     8,354,786 
 Accumulated losses                                          (8,408,513)  ----------------  (8,404,946) ---------------- 
 Total capital and shareholders’ equity                       51,903,146  ----------------   85,822,916 ---------------- 
 LIABILITIES                                                                                                             
 Non-current liabilities                                                                                                 
 Provision for employees’ end of service benefits                 25,540  ----------------       32,658 ---------------- 
 Total non-current liabilities                                    25,540  ----------------       32,658 ---------------- 
 Current liabilities                                                                                                     
 Trade and other payables                                        747,936  ----------------    5,965,089 ---------------- 
 Total current liabilities                                                         773,476                     5,965,089 
                                                                           ---------------              ---------------- 
 Total liabilities and shareholders’ equity                           52,676,622  ========           91,820,663 ======== 

The consolidated financial statements were approved by the Board of Directors
on 26(th) November 2018.

_____________________           
                       

Mustafa Saifuddin
Director

Consolidated statement of changes in equity                 
for the year ended 30(th) June 2018   

                                           Share  capital  USD  Share premium  USD  Available for sale fair valuation reserve  USD  Accumulated  losses  USD       Total  USD 
                                                                                                                                                                              
 At 1st July 2016                                    2,010,490          83,862,586                                               -               (8,189,617)       77,683,459 
 Total comprehensive income for the year                                                                                                                                      
 Loss for the year                                           -                   -                                               -                 (215,329)        (215,329) 
 Other comprehensive income for the year                     -                   -                                       8,354,786                         -        8,354,786 
                                                                                                                                                                              
                                                --------------     ---------------                                  --------------            --------------  --------------- 
 At 30th June 2017                                   2,010,490          83,862,586                                       8,354,786               (8,404,946)       85,822,916 
                                                      ========           =========                                        ========                  ========        ========= 
 At 1st July 2017                                    2,010,490          83,862,586                                       8,354,786               (8,404,946)       85,822,916 
 Total comprehensive income for the year                                                                                                                                      
 Loss for the year                                           -                   -                                               -                   (3,567)          (3,567) 
 Other comprehensive loss for the year                       -                   -                                    (33,916,203)                         -     (33,916,203) 
                                                  ------------      --------------                                  --------------            --------------  --------------- 
                                                                                                                                                                              
 At 30th June 2018                                   2,010,490          83,862,586                                    (25,561,417)               (8,408,513)       51,903,146 
                                                       =======            ========                                        ========                  ========        ========= 

Consolidated statement of cash flows
for the year ended 30(th) June 2018

                                                          30 June 2018     30 June 2017 
                                                                   USD              USD 
 Cash flow from operating activities                                                    
 Net loss for the year                                         (3,567)        (215,329) 
 Adjustments for:                                                                       
 Finance income                                                      -        (422,099) 
 Finance cost                                                        -          383,726 
 Balance payable written back                                (251,598)                - 
 Depreciation                                                      702            4,444 
 Provision for employees’ end of service benefits              (7,118)           23,101 
                                                            ----------   -------------- 
 Operating cash flow before working capital changes          (261,581)        (226,157) 
 Working capital changes:                                                               
 Prepayments, advances and other receivables                   499,086          374,151 
 Trade and other payables                                  (4,965,555)        4,562,117 
 Finance income received                                             -          179,500 
 Finance cost paid                                                   -        (159,268) 
                                                            ----------   -------------- 
 Net cash used in operating activities                     (4,728,050)        4,730,343 
                                                            ----------   -------------- 
 Cash flow from financing activities                                                    
 Loans and advances                                          4,700,000      (4,700,000) 
                                                            ----------  --------------- 
 Net cash flow from financing activities                     4,700,000      (4,700,000) 
                                                            ----------  --------------- 
 Net (decrease)/increase in cash and cash equivalents         (28,050)           30,343 
 Cash and cash equivalents at beginning of the year             42,531           12,188 
                                                             ---------   -------------- 
 Cash and cash equivalents at end of the year                   14,481           42,531 
                                                                 =====            ===== 

Basis of preparation

These consolidated financial statements have been prepared for the 12 months
year ended 30(th) June 2018, whereas corresponding figures were extracted from
the audited consolidated financial statements for the year ended 30(th) June
2017 for comparative purposes as explained above in the chairman’s
statement.

These consolidated financial statements as at 30(th) June 2018 comprise the
Company and its subsidiaries (collectively referred to as “the Group”) and
the Group’s interest in equity accounted investees.

The financial information does not constitute the Group’s consolidated
financial statements for either the year ended 30(th) June 2018 or the year
ended 30(th) June 2017, but is derived from those accounts. The Group’s non
statutory accounts for 2018 are available from the Company's website from
27(th) November 2018. The auditor’s reports on both the 2018 and 2017
accounts were unqualified; did not draw attention to any matters by way of an
emphasis; and did not contain any statement in regard to matters reported on
by exception.

The consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRS). The consolidated financial
statements have been prepared under the historical cost convention, except for
investment properties and available for sale investments which are stated at
fair values. The accounting policies used are consistent with those applied in
the 2017 consolidated financial statements and those that were applied in the
2018 consolidated financial statements.
 

1.     Loss per share

Basic

Basic loss per share is calculated by dividing the loss attributable to owners
of the parent by the weighted average number of ordinary shares in issue
during the year.

                                                                        30 June 2018            30 June 2017 
 Loss attributable to the owners of the parent (USD)               (3,567)  ========      (215,329) ======== 
 Weighted average number of ordinary shares in issue (No.)   249,289,747  ==========  249,289,747 ========== 

The company has no diluted instrument at the reporting date.

2.      Available for sale financial assets

                                                        2018                 2017 
                                                         USD                  USD 
 Balance at the beginning of the year             86,536,290           78,181,504 
 Change in fair value                           (33,916,203)            8,354,786 
                                               -------------        ------------- 
 Balance at the end of the year         52,620,087  ========  86,536,290 ======== 

The Group holds 21.68% interest in Bonyan International Investment Group
(Holding) LLC (“Bonyan”). Bonyan is engaged in the property development
business in the UAE. The Group assessed the investment in Bonyan at its fair
value. The fair value of Bonyan was determined by an independent professional
valuer by using discounted cash flow model.

During the financial year 2017-2018, an Investee Company of Bonyan underwent
capital restructuring which resulted in the dilution of Bonyan’s
shareholding in the Investee Company to 19.68% (30(th) June 2017: 40%). The
dilution arose from the issue of new capital by the Investee Company to
incoming shareholders.

Subsequent to the year under review, the Investee Company’s shares were
listed on the ADX Secondary Market in Abu Dhabi.

3.      Share capital and share premium

Movement in share capital during the year

                                         Number of shares    Ordinary  Shares        Share  Premium                 Total 
                                                                          USD                   USD                   USD 
 At 1st July 2016                             249,289,747           2,010,490            83,862,586            85,873,076 
 Shares issued during the year         -  ---------------     -  ------------     -  --------------     -  -------------- 
 At 30th June 2017                 249,289,747  =========  2,010,490  =======  83,862,586  ========  85,873,076  ======== 
 At 1st July 2017                             249,289,747           2,010,490             2,010,490             2,010,490 
 Shares issued during the year         -  ---------------     -  ------------     -  --------------     -  -------------- 
 At 30th June 2017                 249,289,747  =========  2,010,490  =======  83,862,586  ========  85,873,076  ======== 

As at 30(th) June 2018, Bonyan holds 64,936,640 shares (26.05%) (30(th) June
2016: 61,669,915 shares (24.74%)) of the Company.

Share warrants
No new share warrants were issued by the Company during the year.

This announcement has been made after due and careful enquiry; the directors
of the Group accept responsibility for its content.
 

Enquiries:

Dana Group International Investments Ltd:
Contact: tel: +971 (0)4 430 9355; e-mail: ir@dana-investments.com; further
information on Dana Group International Investments Limited is available from
the Company’s website: www.dana-investments.com 

Keith, Bayley, Rogers & Co. Limited:
Graham Atthill-Beck: tel: +44 (0)20 7464 4091; mobile: +971 (0)50 856 9408/+44
(0)750 643 4107;
e-mail: Graham.Atthill-Beck@kbrl.co.uk; blackpearladvisers@gmail.com
Brinsley Holman: tel: +44 (0)20 7464 4098; e-mail: Brinsley.Holman@kbrl.co.uk

Copies of the Annual Report for the year ended 30(th) June 2018 are available
during normal business hours for a period of one month from the date of this
announcement, by arrangement, from the offices of Keith, Bayley, Rogers & Co.
Limited, No. 1 Royal Exchange Avenue, London, EC3V 3LT; telephone: +44 (0) 20
7464 4090. A soft copy of the Annual Report is also downloadable from the
Company’s website: www.dana-investments.com/.



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