REG - DCI Advisors Ltd - Half-year Report
29/09/2023 07:00
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RNS Number : 0561O DCI Advisors Limited 29 September 2023
DCI Advisors Ltd
("DCI") or the ("Company") and together with its subsidiaries the ("Group")
Half Year Results for the six months ended 30 June 2023 and Trading Update
Financial Highlights:
· At 30 June 2023, the total Group Net Asset Value ("NAV") was
€123.5 million and €116.9 million before and after Deferred Tax
Liabilities ('DΤL") respectively. This represents a decrease of €3.6
million (3.0%) compared to 31 December 2022. The NAV reduction is principally
due to operating, finance, corporate and management expenses.
· In sterling terms, DCl's NAV decreased to 10p per Share on 30
June 2023 compared to 11p on 31 December 2022. The Sterling NAV per share fell
notably due to a 2.9% depreciation in Sterling against the Euro during the
period.
· Aggregate Group debt was €5.7 million, a Group total debt to
gross asset ratio of 3.4% as at 30 June 2023 (31 December 2022: 2.8%).
Enquiries
DCI Advisors Ltd
Nicolai Huls / Nick Paris, Managing Directors nickparis@btinternet.com (mailto:nickparis@btinternet.com)
+44 (0) 7738 470550
Cavendish Capital Markets Limited (Nominated Adviser & Broker)
William Marle / Jonny Franklin-Adams / Edward Whiley (Corporate Finance)
Mark Whitfeld / Pauline Tribe (Sales) +44 (0) 20 7220 0500
FIM Capital Limited (Administrator) llennon@fim.co.im (mailto:llennon@fim.co.im) / gdevlin@fim.co.im
(mailto:gdevlin@fim.co.im)
Lesley Lennon / Grainne Devlin (Corporate Governance)
DCI Advisors Limited
https://www.dciadvisorsltd.com/
Unaudited lnterim Financial Report
For the Six Months Ended 30 June 2023
DCI Advisors Limited
Chairman's Statement
Dear Shareholder,
I am pleased to report the Interim results for the first half of 2023.
The focus remains on improving the Company's corporate governance and
implementing its new investment policy and realisation strategy that was
approved by shareholders in December 2021, and is aimed at selling the
remaining investments, repaying debt and distributing the net proceeds to
shareholders.
Following the removal of Dolphin Capital Partners as investment manager (on
20(th) March) and Miltos Kambourides from the board of the Company on 18(th)
March, the Company has gone through a stabilisation phase of securing its
assets and managing them with a view to readying them for sale. Construction
has restarted at Kilada, and efficiency improved through the cutting of costs
in order to complete phase one, which when we intend to sell it. Asset sale
processes that have already started have been kept on track, but none has
reached a notifiable conclusion.
Summary of Financial Performance
At 30 June 2023, the Group Net Asset Value after Deferred Tax Liability was
€117 million, representing a 3.0% decrease compared to 31 December 2022. The
NAV decline reflects operating and other expenses of €2.99 million (30 June
2022: €1.897 million). The net loss after tax attributable to the owners of
the Company was €3.29 million, as at 30 June 2023.
ln sterling terms, DCl's NAV decreased to 10p per Share on 30 June 2023
compared to 11p on 31 December 2022. At 30 June 2023, DCI had a market
capitalisation of approximately £35.7 million, compared with the Company's
NAV of £100.6 million after DTL.
Additional Director
It is our intention to appoint a new independent Director in the coming months
in order to enhance the corporate governance within the Company. We will
update shareholders as soon as the process has been completed.
I would like to thank shareholders and our numerous service providers for the
support and confidence that they have given the Board in proceeding with the
changes outlined above.
Sean Hurst
Chairman
DCI Advisors Ltd
28 September 2023
DCI Advisors Limited
Managing Directors' Statement
Business Overview
This report covers the period from January to September 2023 during which
period (in particular in March) the Company terminated the Investment
Management Agreement with the Company's former investment manager, Dolphin
Capital Partners Limited ("DCP") and the board took over the self-management
of the Company. Since then, the board has worked to improve and streamline the
Company's operations and has reaffirmed terms with all of the Company's key
service providers in Greece, Cyprus and Croatia but certain changes were
necessary in order to create a basis to move forwards at an acceptable cost.
Nick Paris and Nicolai Huls were previously non-executive Directors of the
Company but have taken on the role of executive Managing Directors in order to
replace DCP. Whilst the Company has hired a few people to work on a
consultancy basis the Managing Directors have significantly reduced the cash
outflow of managing the Company as DCP was being paid advances against future
incentive fees of over €2 million per annum (repayment of which is claimed
by DCI in its counterclaim in the UK litigation brought by DCP).
The Managing Directors have also focused on enhancing the value of the
Company's existing portfolio of assets and are pursuing divestment
opportunities for all of the Company's assets except Kilada which is in the
middle of finalising phase 1 of its construction. There are active sale
discussions underway for several of the Company's assets, including Livka Bay
in Croatia, but none has yet reached the stage of binding commitments.
The Company has financed its operations via a series of loans arranged
directly from certain shareholders of the Company and each of these loans is
intended to last up to 12 months but to be repaid out of the proceeds of asset
sales. They all bear an interest rate of 12% p.a. but no advance or redemption
charges. Security will be granted against these loans in the form of
individual charges over one of the Company's assets in amounts which will
exceed the value of each loan. The support from shareholders via the loans has
helped the Company to manage the transition phase since DCP's termination as
investment manager.
The number of people supporting the Company's business has reduced
significantly since DCP's termination. Despite this, operations have
continued, and have even improved while at the same time the Company has been
able to continue to make steps in the sales process of some of its assets.
The legal case in the UK brought by DCP against the Company is still ongoing.
While a continued legal fight with DCP is not the Company's preference, at
present the board do not believe that DCP has shown serious interest in
settling the outstanding issues between DCP and the Company.
Major Assets Review
Assets located in Greece:
Kilada Country Club, Golf & Residences (for further details see
www.mykilada.com)
Construction work at Kilada has been financed from a loan granted by the
Company's joint venture partner and the Company also expects to be able to
draw down the first tranches of the government grant that the Company was
awarded shortly.
Development of Phase 1 continues and the Company still expects to finalise
this development phase by the end of 2024. This would include finalising the
18-hole Jack Niklaus Signature golf course, the country club and the
infrastructure for 90 villas. It is the target to have finished 9 holes of the
golf course by October/November this year.
Due to the progress the development is making, the Company would like to bring
forward the development of the hotel component in order to support the golf
course. The Company also expects sales momentum for villas and land lots to
pick up as the finalisation of the golf course draws nearer.
Lavender Bay
The situation at Lavender Bay has been clarified and improved. The Archdiocese
of Dimitriada and the Holy Monastery of Xenia have filed lawsuits against the
State to resolve judicially the ownership issues.
The Company will also file a corresponding lawsuit in the following weeks. The
cases of all three entities are very strong. The filing of the lawsuits will
increase the valuation of the land and consequently reduce the negative
valuation of the asset.
No additional funds will be paid to the vendor under the Company's sale and
purchase contracts until the resolution of the legal dispute with the Greek
State has been resolved.
Plaka Bay
The studies for a Special Development Plan for an integrated resort have been
completed and will be submitted to the relevant authorities. Approval of this
plan is anticipated to enhance the asset's valuation and market appeal.
Scorpio Bay
The Company is currently reviewing the update of permits and the agreement
with Oberoi Hotels and Resorts to restore the asset's valuation and market
appeal.
Assets located in Cyprus:
Aristo Developers Limited (a 47.9% affiliate) (for further details see
www.aristodevelopers.com (http://www.aristodevelopers.com) )
Aristo continues to benefit from a strong recovery in the residential real
estate market in Cyprus albeit tempered by the increase in construction costs
and bank interest rates that is being experienced worldwide. Property sales
are growing month on month and margins are good and surplus cash flow is being
used to pay down bank borrowings to further deleverage the company.
The sale process for the Company's holding in Aristo that commenced in
February was affected by disruptions in global equity markets which occurred
soon afterwards but is still continuing. It is too early to predict whether
and when this will lead to sale negotiations.
Apollo Heights
Apollo Heights is a large area of contiguous land which is situated next to
one of the British military bases in Cyprus and as such, planning permissions
are influenced by intra-government relations between Cyprus and the United
Kingdom. The site also contains a mix of agricultural and forest land and the
Company is still awaiting the results of a planning appeal that the Company
lodged in September 2022 to improve the planning status of the site. Despite
this the Company is currently exploring several indications of interest in
buying the land.
Asset located in Croatia:
Livka Bay
A sale process commenced in April with the assistance of one of the main local
property advisers in Croatia in order to find a buyer for the entire site or a
joint venture partner who would inject equity to develop the hotel, villas and
marina that are already permitted for the site by the local government. Strong
interest was expressed for a 100% purchase and the Company is working with
several buyers who lodged letters of intent. The Company's aim is to agree
acceptable terms with one of them that would lead to a sale of Livka Bay in
the near future.
Outlook
The Company's main objectives going forward are to:
1. secure adequate working capital liquidity for the Company until
asset sales have been completed;
2. execute further portfolio asset disposals;
3. progress construction at Kilada and start to generate plot/villa
sales;
4. progress planning and permitting selectively for the remaining
portfolio: and,
5. repay the Company's modest borrowings and once it has reserved
adequate cash for working capital purposes, to distribute surplus capital to
shareholders although it is too early to predict when the first distribution
will be made.
6. make a first distribution within 12 months' time.
Nicolai Huls, Managing Director
Nick Paris, Managing Director
DCI Advisors Ltd
28 September 2023
DCI ADVISORS LTD (FORMERLY: DOLPHIN CAPITAL INVESTORS LTD)
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
For the six-month period ended 30 June 2023
6 Months 6 Months
ended ended
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
Note €'000 €'000
Revenue 6 4 55
Cost of sales - -
Gross profit 4 55
Gain on disposal of equity-accounted investees - -
Change in valuations - -
Directors' remuneration (187) (100)
Professional fees 7 (1,934) (1,049)
Administrative and other expenses 8 (869) (722)
Total operating and other expenses (2,990) (1,871)
Results from operating activities (2,986) (1,816)
Finance income 57 1
Finance costs (614) (1,290)
Net finance costs (557) (1,289)
Share of losses on equity-accounted investees - (275)
Loss before taxation (3,543) (3,380)
Taxation 9 (1) (2)
Loss (3,544) (3,382)
Other comprehensive Loss
Foreign currency translation differences (69) (24)
Other comprehensive loss, net of tax (69) (24)
Total comprehensive loss (3,613) (3,406)
Loss attributable to:
Owners of the Company (3,286) (2,972)
Non-controlling interests (258) (410)
(3,544) (3,382)
Total comprehensive loss attributable to:
Owners of the Company (3,355) (2,996)
Non-controlling interests (258) (410)
(3,613) (3,406)
Loss per share
Basic and diluted loss per share (€) 10 (0.004) (0.003)
DCI ADVISORS LTD (FORMERLY: DOLPHIN CAPITAL INVESTORS LTD)
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2023
30 June 31 December 2022
2023 (Audited)
(Unaudited)
Note €'000 €'000
Assets
Property, plant and equipment 11 15,854 15,226
Investment property 12 45,943 45,943
Equity-accounted investees 13 42,694 42,694
Non-current assets 104,491 103,863
Trading properties 14 56,516 56,516
Receivables and other assets 15 9,344 10,083
Cash and cash equivalents 318 2,226
Current assets 66,178 68,825
Total assets 170,669 172,688
Equity
Share capital 16 9,046 9,046
Share premium 16 569,847 569,847
Retained deficit (470,600) (467,314)
Other reserves 459 528
Equity attributable to owners of the Company 108,752 112,107
Non-controlling interests 8,182 8,440
Total equity 116,934 120,547
Liabilities
Loans and borrowings 17 10,858 10,434
Deferred tax liabilities 18 6,577 6,577
Lease liabilities 3,347 3,347
Trade and other payables 19 19,795 19,795
Non-current liabilities 40,577 40,153
Loans and borrowings 17 5,709 4,611
Lease liabilities 88 88
Trade and other payables 19 7,361 7,289
Current liabilities 13,158 11,988
Total liabilities 53,735 52,141
Total equity and liabilities 170,669 172,688
Net asset value ('NAV') per share (€) 20 0.12 0.12
The condensed consolidated financial statements were authorised for issue by
the Board of Directors on 28 September 2023.
Nick Paris
Nicolai Huls
Managing
Director
Managing Director
DCI ADVISORS LTD (FORMERLY: DOLPHIN CAPITAL INVESTORS LTD)
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the six-month period ended 30 June 2023
Attributable to owners of the Company
Share Share Translation Revaluation Retained Non-controlling Total
capital premium reserve reserve deficit Total interests equity
€'000 €'000 €'000 €'000 €'000 €'000 €'000 €'000
Balance at 1 January 2022 9,046 569,847 305 279 (460,390) 119,087 8,942 128,029
Comprehensive income
Loss - - - - (2,972) (2,972) (410) (3,382)
Other comprehensive income
Foreign currency translation differences - - (24) - - (24) - (24)
Total other comprehensive income - - (24) - - (24) - (24)
Total comprehensive income - - (24) - (2,972) (2,996) (410) (3,406)
TRANSACTIONS WITH OWNERS OF THE COMPANY
Changes in ownership interests in subsidiaries
Disposal of interests without a change in control - - - - - - 621 621
Total transactions with owners of the Company - - - - - - 621 621
Balance at 30 June 2022 9,046 569,847 281 279 (463,362) 116,091 9,153 125,244
9,046 569,847 249 279 (467,314) 112,107 8,440 120,547
Balance at 1 January 2023
Comprehensive income
Loss - - - - (3,286) (3,286) (258) (3,544)
Other comprehensive income
Foreign currency translation differences - - (69) - - (69) - (69)
Total other comprehensive income - - (69) - - (69) - (69)
Total comprehensive income - - (69) - (3,286) (3,355) (258) (3,613)
Balance at 30 June 2023 9,046 569,847 180 279 (470,600) 108,752 8,182 116,934
DCI ADVISORS LTD (FORMERLY: DOLPHIN CAPITAL INVESTORS LTD)
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
For the six-month period ended 30 June 2023
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
€'000 €'000
Cash flows from operating activities
Loss (3,544) (3,382)
Adjustments for:
Depreciation charge 47 38
Interest expense 122 1,291
Exchange difference (69) (24)
Share of losses on equity-accounted investees, net of tax - 275
(3,444) (1,802)
Changes in:
Receivables 739 (752)
Payables 72 14
Cash used in operating activities (2,633) (2,540)
Tax paid - (52)
Net cash used in operating activities (2,633) (2,592)
Cash flows from investing activities
Acquisitions of investment property - (145)
Acquisitions of property, plant and equipment (675) (1,702)
Proceeds from other investments - 99
Net cash (used in)/ from investing activities (675) (1,748)
Cash flows from financing activities
New loans 1,400 810
Proceeds from issue of redeemable preference shares - 3,000
Transaction costs related to loans and borrowings - (165)
Interest paid - (768)
Net cash from/ (used in) financing activities 1,400 2,877
Net decrease in cash and cash equivalents (1,908) (1,463)
Cash and cash equivalents at the beginning of the period 2,226 4,575
Cash and cash equivalents at the end of the period 318 3,112
For the purpose of the consolidated statement of cash flows, cash and cash
equivalents consist of the following:
Cash in hand and at bank 318 3,112
Cash and cash equivalents at the end of the period 318 3,112
DCI ADVISORS LTD (FORMERLY: DOLPHIN CAPITAL INVESTORS LTD)
NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS
For the six-month period ended 30 June 2023
1. REPORTING ENTITY
DCI Advisors Ltd (Formerly: Dolphin Capital Investors Ltd) (the 'Company') was
incorporated and registered in the British Virgin Islands ('BVI') on 7 June
2005. The Company is a real estate investment company focused on the
early-stage, large-scale leisure-integrated residential resorts in the Eastern
Mediterranean. The Company was managed, until 20 March 2023, by Dolphin
Capital Partners Ltd (the 'Investment Manager'), an independent private
management firm that specialises in real estate investments, primarily in
south-east Europe, and thereafter the Company became self-managed. The shares
of the Company were admitted to trading on the AIM market of the London Stock
Exchange ('AIM') on 8 December 2005.
With effect from 01 June 2023, the name of the Company was changed from
Dolphin Capital Investors Ltd to DCI Advisors Ltd.
These condensed consolidated interim financial statements of the Company as at
and for the six-month period ended 30 June 2023 comprise the financial
statements of the Company and its subsidiaries (together referred to as the
'Group') and the Group's interests in equity-accounted investees. These
interim financial statements have not been subject to an audit.
2. basis of preparation
a. Statement of compliance
These condensed consolidated interim financial statements for the six-month
period ended 30 June 2023 have been prepared in accordance with IAS 34 Interim
Financial Reporting and should be read in conjunction with the Group's last
annual consolidated financial statements as at and for the year ended 31
December 2022 ('last annual financial statements'). They do not include all of
the information required for a complete set of financial statements prepared
in accordance with IFRS Standards. However, 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. They are presented in Euro (€),
rounded to the nearest thousand.
These condensed consolidated interim financial statements were authorised for
issue by the Board of Directors on 28 September 2023.
b. Basis of preparation
The condensed consolidated interim financial statements of the Company for the
six-month period ended 30 June 2023 have been prepared on a going concern
basis, which assumes that the Group will be able to discharge its liabilities
in the normal course of business.
The Group's cash flow forecasts for the foreseeable future involve
uncertainties related primarily to the exact disposal proceeds and timing of
disposals of the assets expected to be disposed of. Management believes that
the proceeds from forecast asset sales will be sufficient to maintain the
Group's cash flow at a positive level. Should the need arise, management will
take actions to reduce costs and is confident that it can secure additional
loan facilities and/or obtain repayment extension on existing ones, until
planned asset sales are realised and proceeds received.
Ιf, for any reason, the Group is unable to continue as a going concern, then
this could have an impact on the Group's ability to realise assets at their
recognised values and to extinguish liabilities in the normal course of
business at the amounts stated in the condensed consolidated interim financial
statements.
Based on these factors, management has a reasonable expectation that the Group
has and will have adequate resources to continue in operational existence for
the foreseeable future.
3. PRINCIPAL subsidiaries
The Group's most significant subsidiaries were the following:
Country of Shareholding interest
Name Project incorporation 30.6.2023 31.12.2022*
Scorpio Bay Holdings Limited Scorpio Bay Resort Cyprus 100% 100%
Scorpio Bay Resort S.A. Scorpio Bay Resort Greece 100% 100%
Xscape Limited Lavender Bay Resort Cyprus 100% 100%
Golfing Developments S.A. Lavender Bay Resort Greece 100% 100%
MindCompass Overseas One Limited Kilada Hills Golf Resort Cyprus 85% 85%
MindCompass Overseas S.A. Kilada Hills Golf Resort Greece 85% 85%
MindCompass Overseas Two S.A. Kilada Hills Golf Resort Greece 100% 100%
MindCompass Parks S.A. Kilada Hills Golf Resort Greece 100% 100%
DCI Greek Collection Limited Kilada Hills Golf Resort Cyprus 100% 100%
DCI Holdings One Limited (1) Aristo Developers BVIs 100% 100%
D.C. Apollo Heights Polo and Country Resort Limited Apollo Heights Resort Cyprus 100% 100%
Symboula Estates Limited Apollo Heights Resort Cyprus 100% 100%
Azurna Uvala D.o.o. Livka Bay Resort Croatia 100% 100%
Eastern Crete Development Company S.A. Plaka Bay Resort Greece 100% 100%
Single Purpose Vehicle Ten Limited (2) One&Only Kea Resort Cyprus 67% 67%
The above shareholding interest percentages are rounded to the nearest
integer.
(1) This entity holds a 48% shareholding interest in DCI Holdings Two Ltd
("DCI H2") which is the owner of Aristo Developers Ltd.
(2) In December 2022 year this entity disposed of the 50% shareholding
interest in Single Purpose Vehicle Fourteen Limited (owner of One&Only Kea
Resort
4. Significant accounting policies
The accounting policies applied by the Group in these condensed consolidated
interim financial statements are the same as those applied by the Group in its
consolidated financial statements as at and for the year ended 31 December
2022. Α number of new standards are effective from 1 January 2023, but they
do not have a material effect on the Group's financial statements.
Where necessary, comparative figures have been adjusted to conform to changes
in presentation in the current period.
5. USE OF JUDGEMENTS AND ESTIMATES
The preparation of interim financial statements requires management to make
judgements, estimates and assumptions that affect the application of
accounting policies and the reported amounts of assets and liabilities, income
and expense. Actual results may differ from these estimates.
ln preparing these condensed consolidated interim financial statements, the
significant judgements made by the management in applying the Group's
accounting policies and the key sources of estimation and uncertainty were the
same as those applied to the last annual financial statements.
6. revenue
6 Months 6 Months
ended ended
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
Other revenue
Other income 4 55
Total 4 55
7. PROFESSIONAL FEES
6 Months 6 Months
ended ended
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
€,000 €,000
Legal fees 810 318
Auditors' remuneration 100 80
Accounting expenses 75 99
Appraisers' fees 12 -
Project design and development fees 100 207
Consultancy fees 53 63
Administrator fees 115 186
Other professional fees 669 96
Total 1,934 1,049
8. ADMINISTRATIVE AND OTHER EXPENSES
6 Months 6 Months
ended ended
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
€,000 €,000
Travelling and accommodation 72 28
Insurance 22 35
Marketing and advertising expenses 28 30
Personnel expenses 230 274
Immovable property and other taxes - 78
Rents 12 41
Other 505 236
Total 869 722
9. Taxation
6 Months 6 Months
ended ended
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
€,000 €,000
Income tax expense 1 -
Deferred tax expense/(income) - 2
Taxation expense/(income) recognised in profit or loss 1 2
10. LOSS per share
Basic loss per share
Basic loss per share is calculated by dividing the loss attributable to owners
of the Company by the weighted average number of common shares outstanding
during the year.
6 Months 6 Months
ended ended
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
€,000 €,000
Loss attributable to owners of the Company (€) (3,286) (2,972)
Number of weighted average common shares outstanding 904,627 904,627
Basic loss per share (€) (0.004) (0.003)
Diluted loss per share
As at 30 June 2023 and 2022, the diluted loss per share is the same as the
basic loss per share, as there were no outstanding dilutive potential ordinary
shares (a financial instrument or other contract that, when converted to
ordinary shares, would decrease earnings per share or increase loss per share)
during these periods.
11. Property, plant and equipment
Property under construction Land & Machinery & equipment
€'000 buildings €'000 Other Total
€'000 €'000 €'000
30 June 2023 (Unaudited)
Cost or revalued amount
At beginning of the period 8,924 20,457 377 45 29,803
Direct acquisitions - 671 3 1 675
At end of the period 8,924 21,128 380 46 30,478
Depreciation and impairment
At beginning of the period - 14,174 365 38 14,577
Depreciation charge for the year - 36 8 3 47
At end of the period - 14,210 373 41 14,624
Carrying amounts 8,924 6,918 7 5 15,854
Property under construction Land & Machinery & equipment
€'000 buildings €'000 Other Total
€'000 €'000 €'000
31 December 2022 (Audited)
Cost or revalued amount
At beginning of year 5,683 20,445 366 45 26,539
Direct acquisitions 3,241 12 11 - 3,264
At end of year 8,924 20,457 377 45 29,803
Depreciation and impairment
At beginning of year - 17,080 357 33 17,470
Depreciation charge for the year - 38 9 1 48
Reversal of impairment loss - (2,944) - - (2,944)
Exchange difference - - (1) 4 3
At end of year - 14,174 365 38 14,577
Carrying amounts 8,924 6,283 12 7 15,226
Fair value hierarchy
The fair value of land and buildings, has been categorised as a Level 3 fair
value based on the inputs to the valuation techniques used.
Valuation techniques and significant unobservable inputs
The valuation techniques used in measuring the fair value of land and
buildings, as well as the significant unobservable inputs used, are the same
as those used as at 31 December 2022.
12. Investment property
30 June 31 December 2022
2023 (Audited)
(Unaudited)
€'000 €'000
At beginning of year 45,943 52,188
Capital subsequent expenditure - 75
Fair value adjustment - (6,316)
Exchange differences - (4)
At end of year 45,943 45,943
Fair value hierarchy
The fair value of investment property has been categorised as a Level 3 fair
value based on the inputs to the valuation techniques used.
Valuation techniques and significant unobservable inputs
The valuation techniques used in measuring the fair value of investment
property, as well as the significant unobservable inputs used, are the same as
those used as at 31 December 2022.
13. equity-accounted investees
DCI H2 SPV14 Total
€'000 €'000 €'000
30 June 2023 (Unaudited)
At beginning of year 42,694 - 42,694
Share of loss, net of tax - - -
Reversal of impairment loss - - -
At end of year 42,694 - 42,694
31 December 2022 (Audited)
At beginning of year 42,694 22,861 65,555
Share of loss, net of tax (388) (1,397) (1,785)
Disposal of Associate - (21,464) (21,464)
Reversal of impairment loss 388 - 388
At end of year 42,694 - 42,694
Single Purpose Vehicle Fourteen Limited ('SPV 14')
On 23 December 2022 it was announced that the Company had completed the
disposal of its entire interest in the One&Only at Kea Island ('OOKI')
Project. Prior to the sale, the Company was the owner of 66.67% of Single
Purpose Vehicle Ten Ltd ('SPV10') which, in turn, indirectly owned 50% of SPV
14, thereby providing the Company with an effective equity interest of 33.33%
in SPV 14 and the OOKI project.
DCI Holdings Two Limited ("DCI H2")
As at 30 June 2023, 30 June 2022 and 31 December 2023 the investment in DCI
Η2 is presented at its recoverable amount of €42.7 million. The recoverable
amount is calculated based on the NAV of DCI Η2 group at the reporting date
adjusted by approximately 30% discount on the DCI Η2 group's real estate
properties. The fair value of the investment in DCI Η2 has been categorised
as a Level 3 fair value based on the inputs to the valuation techniques used.
The details of the above investments are as follows:
Country of Shareholding interest
Name incorporation Principal activities 30 June 2023 31 December 2022
SPV 14 Cyprus Development of OOKI Resort - -
DCI H2 BVI Acquisition and holding of real estate investments in Cyprus 48% 48%
The above shareholding interest percentages are rounded to the nearest
integer.
14. Trading properties
30 June 31 December 2022
2023 (Audited)
(Unaudited)
€'000 €'000
At beginning of year 56,516 56,516
At end of year 56,516 56,516
15. RECEIVABLES AND OTHER ASSETS
Note 30 June 31 December 2022
2023 (Audited)
(Unaudited)
€'000 €'000
Trade receivables 50 90
Other receivables 21.3.1 278 939
Loan Receivable 6,637 6,637
VAT receivables 447 509
Total Trade and other receivables 7,412 8,175
Amounts Receivable from Investment Manager 21.2 1,898 1,898
Prepayments and other assets 34 10
Total 9,344 10,083
The amount receivable from Investment Manager relates to €3.0 million (2022:
€3.0 million) of advance payments made net of variable management fee
payable of €1.1 million (2022: €1.1 million). See note 21.2 for further
information.
16. capital and reserves
Capital
Authorised share capital
As at 30 June 2023 and 31 December 2022 '000 of shares €'000
Common shares of €0.01 each 2,000,000 20,000
Movement in share capital and premium
Shares in issue Share capital Share premium
'000 €'000 €'000
Capital at 31 December 2022 and to 30 June 2023 904,627 9,046 569,847
Reserves
Translation reserve: Translation reserve comprises all foreign currency
differences arising from the translation of the financial statements of
foreign operations.
Revaluation reserve: Revaluation reserve relates to the revaluation of
property, plant and equipment from both subsidiaries and equity-accounted
investees, net of any deferred tax.
17. loans AND BORROWINGS
30 June 31 December 2022
2023 (Audited)
(Unaudited)
€'000 €'000
Loans denominated in Euro 4,288 4,611
Redeemable preference shares 10,858 10,434
Shareholder Loans 1,421 -
Total 16,567 15,045
Loans denominated in Euro 4,288 4,611
Redeemable preference shares - -
Shareholder Loans 1,421 -
Within one year 5,709 4,611
Loans denominated in Euro - -
Redeemable preference shares 10,858 10,434
Shareholder Loans - -
Two to five years 10,858 10,434
Loans denominated in Euros
The maturity date of the outstanding bank loan to Azurna Uvala (the owner of
"Livka Bay") was extended to 31 December 2023 in the reporting period.
Redeemable preference shares
On 18 December 2019, the Company signed an agreement with an international
investor for a €12 million investment in the Kilada Hills Project. The
investor agreed to subscribe for both common and preferred shares. The total
€12 million investment was payable in 24 monthly instalments of €500,000
each. Under the terms of the agreement, the investor is entitled to a priority
return of the total investment amount from the net disposal proceeds realised
from the project and retains a 15% shareholding stake in Kilada. As of 30 June
2023, 15.00% (31 December and 30 June 2022: 15.00%) of the ordinary shares
have been transferred to the investor.
As of 30 June 2023, 12,000 redeemable preference shares (31 December and 30
June 2022: 12,000) were issued as fully paid with value of €1,000 per share.
The redeemable preference shares were issued with a zero-coupon rate and are
discounted with a 0.66% effective monthly interest rate, do not carry the
right to vote and are redeemable when net disposal proceeds are realised from
the Kilada Project.
Shareholder Loans
During 2023 the company entered into a number of shareholder loans totaling
€1.4 million (31 December and 30 June 2022: €Nil). These loans attract
an interest rate of 12% per annum on a non-compounding basis, with no fees
payable on disbursement or repayments. The initial termination date of the
loans is the 30 September 2023. If, prior to the initial termination date, the
Group provides collateral in the form of security over certain Company assets
which exceeds the aggregate value of the loans, the termination date will be
extended to 12 months from the date of entering into agreements.
Terms and conditions of the loans
The terms and conditions of other outstanding loans is as follows:
Secured loan Currency Interest rate Maturity dates 2023 2022
€'000 €'000
Livka Bay Euro Euribor plus 4.25% p.a. 2023 4,288 4,611
Shareholder loans Euro 12% 2023 1,421 -
Total interest-bearing liabilities 5,709 4,611
Security given to lenders
As at 30 June 2023, the Group's loans were secured as follows:
· Regarding the Kilada preference shares, upon transfer of the
entire amount of €12 million from the investor in accordance with the terms
of the agreement, a mortgage is set against the immovable property of the
Kilada Hills Project, in the amount of €15 million (2021: €15 million).
· Regarding the Livka Bay loan, a mortgage against the immovable
property of the Croatian subsidiary, Azurna Uvala (the owner of "Livka Bay"),
with a carrying value of €17.7 million (2021: €17.0 million), two
promissory notes, a debenture note and a letter of support from its parent
company Single Purpose Vehicle Four Limited.
· Regarding the Shareholder Loans, in line with the agreements the
group is expected to provide collateral in the form of security over certain
Company assets before the 30 September 2023.
· The Company is in the process of removing the security of a
senior loan facility which was a fixed and floating charge over all of the
Company's assets and was repaid in December 2022.
· In addition, the development at OOKI was partly funded by a
construction loan which was secured over its assets and those of Scorpio Bay
asset. Steps are being taken to remove the security over Scorpio Bay now that
we have sold our interest in OOKI.
18. Deferred tax liabilities
30 June 31 December 2022
2023 (Audited)
(Unaudited)
€'000 €'000
Balance at the beginning of the year 6,577 6,609
Recognised in profit or loss - (19)
Exchange differences - (13)
Balance at the end of the year 6,577 6,577
Deferred tax liabilities are attributable to the following:
30 June 31 December 2022
2023 (Audited)
(Unaudited)
€'000 €'000
Investment properties 2,215 2,215
Trading properties 4,299 4,299
Property, plant and equipment 63 63
Total 6,577 6,577
19. Trade and other payables
30 June 31 December 2022
2023 (Audited)
(Unaudited)
€'000 €'000
Land creditor 20,752 20,752
Other payables and accrued expenses 6,404 6,332
Total 27,156 27,084
30 June 31 December 2022
2023 (Audited)
(Unaudited)
€'000 €'000
Non-current 19,795 19,795
Current 7,361 7,289
Total 27,156 27,084
Land creditors relate to contracts in connection with the purchase of land at
Lavender Bay from the Church. The above outstanding amount bears an annual
interest rate equal to the inflation rate, which cannot exceed 2% p.a.. Full
settlement is due on 31 December 2025. The Group is in negotiations with the
land creditor with a view to ensuring that no additional funds are paid to
them under the sale and purchase contracts until the resolution of the legal
dispute with the Greek State and, also to reduce the overall quantum of the
Group's deferred liabilities to them, potentially swapping all or part of the
deferred payments against equity in the project.
20. NAV per share
30 June 2023 31 December 2022
(Unaudited) (Audited)
'000 '000
Total equity attributable to owners of the Company (€) 108,752 112,107
Number of common shares outstanding at end of year 904,627 904,627
NAV per share (€) 0.12 0.12
21. Related party transactions
21.1 Directors' interest and remuneration
Directors' interests
Miltos Kambourides is the founder and managing partner of the Investment
Manager whose IMA was terminated on 20 March 2023.
Martin Adams, Nick Paris and Nicolai Huls were non-executive Directors
throughout 2022, with Mr. Martin Adams serving as Chairman of the Board of
Directors. On 10 February 2023, Martin Adams resigned as a Director and Sean
Hurst was appointed as a non-executive Director and Chairman.
The interests of the Directors as at 30 June 2023, all of which are
beneficial, in the issued share capital of the Company as at this date were as
follows:
Shares
'000
Nicolai Huls 775
Nick Paris 1,634
Sean Hurst 475
Save as disclosed in this Note, none of the Directors had any interest during
the year in any material contract for the provision of services which was
significant to the business of the Group.
Directors' remuneration
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
€'000 €'000
Remuneration 187 100
Total remuneration 187 100
The Directors' remuneration details were as follows:
30 June 30 June
2023 2022
(Unaudited) (Unaudited)
€'000 €'000
Martin Adams (resigned 10 February 2023) 8 37
Sean Hurst (appointed 10 February 2023) 29 -
Nick Paris 75 33
Nicolai Huls 75 30
Total 187 100
Miltos Kambourides waived his fees for 2022 through to the date he was removed
from the board.
21.2 Investment Manager remuneration
On 20 March 2023 the Directors terminated the Investment Management Agreement
dated 1 December 2021 (the "IMA") between the Company and the Investment
Manager. Since 31 December 2021 no fixed management fee was due to the
Investment Manager. The following outlines the amount receivable from the
investment manager following the termination.
30 June 31 December 2022
2023 (Audited)
(Unaudited)
€'000 €'000
Variable management fee payable (1,075) (1,075)
Project Fees (2) (2)
Incentive fee advance payments 2,975 2,975
Amount Receivable from Investment Manager 1,898 1,898
21.3 Other related party transactions
21.3.1 Exactarea Holdings Limited
On 15th December 2022 SPV10 entered into a bridge loan facility with its 33%
shareholder Exacterea Holding Limited, making available of a principle amount
up to €6.6 million. The loan is interest-free and repayable at the latest
six months from the date of the agreement.
This loan was in connection with the sale of our interest in OOKI, agreed to
be deemed to be fully repaid when the courts in Cyprus approved an application
to reduce the share premium reserve account of SPV10.
As at the 30 June 2023 and 31 December 2022 the full €6.6 million was
outstanding. While the application above was approved on 16th of January 2023,
the Company is awaiting confirmation before the loan is deemed fully repaid.
21.3.2 Discover Investment Company and Almitas Capital LLC
Nicolai Huls is a Director of Discover Investment Company which provided a
shareholder loan of €350 thousand to the Company in May 2023. In September
2023, Almitas Capital LLC, who owns more than 10% of the issued share capital
of the Company, provided two loans to the Company amounting to US$330 thousand
in total.
The terms of each of these loans are the same as the loans provided by other
shareholders who are not Related Parties and the loans are for a 12 month term
bearing an interest rate of 12% per annum with no fees payable on disbursement
or repayment. If the loans have not been repaid within 6 months from
initiation, collateral in the form of security over certain Company assets
will be put in place which exceeds the aggregate value of the loans.
22. CONTINGENT LIABILITY
The Company is currently in dispute a supplier over invoices for services
during 2023 for which contracted terms had not been agreed. The Directors
intend to contend these amounts and no provision has been made in the
accounts.
23. SUBSEQUENT EVENTS
There were no other material events after the reporting period except the one
described above and in note 21.3, which have a bearing on the understanding of
the consolidated financial statements as at 30 June 2023.
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