REG - Dolphin Capital Inv - Final Results <Origin Href="QuoteRef">DOLC.L</Origin> - Part 3
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approach.
The cost approach measures value by estimating the Replacement Cost New or the Reproduction Cost New of property and then
determining the deductions for accrued depreciation that should be made to reflect the age, condition and situation of the
asset during its past and proposed future economic working life. The direct sales comparison approach is based on the
premise that persons in the marketplace buy by comparison. It involves acquiring market sales/offerings data on properties
similar to the subject property. The prices of the comparables are then adjusted for any dissimilar characteristics as
compared to the subject's characteristics. Once the sales prices are adjusted, they can be reconciled to estimate the fair
value for the subject property. Based on the income approach, an estimate is made of prospective economic benefits of
ownership. These amounts are discounted and/or capitalised at appropriate rates of return in order to provide an
indication of value. The residual value approach is used for the valuation of the land and depends on two basic factors:
the location and the total value of the buildings developed on a site. Under this approach, the residual value of the land
is calculated by subtracting from the estimated sales value of the completed development, the development cost.
Each of the above-mentioned valuation techniques results in a separate valuation indication for the subject property. Then
a reconciliation process is performed to weigh the merits and limiting conditions of each approach. Once this is
accomplished, a value conclusion is reached by placing primary weight on the technique, or techniques, that are considered
to be the most reliable, given all factors.
Financial assets
The fair value of financial assets that are listed on a stock exchange is determined by reference to their quoted bid price
at the reporting date. If the market for a financial asset is not active (and for unlisted securities), the Group
establishes fair value by using valuation techniques. These include the use of recent arm's length transactions, reference
to other instruments that are substantially the same and discounted cash flow analysis, making maximum use of market inputs
and relying as little as possible on entity specific inputs. Equity investments for which fair values cannot be measured
reliably are recognised at cost less impairment.
Trade and other receivables
The fair value of trade and other receivables, excluding construction work in process, is estimated as the present value of
future cash flows, discounted at the market rate of interest at the reporting date.
Non-derivative financial liabilities
Fair value, which is determined for disclosure purposes, is calculated based on the present value of future principal and
interest cash flows, discounted at the market rate of interest at the reporting date. For finance leases, the market rate
of interest is determined by reference to similar lease agreements.
Equity-settled share-based payment arrangements
The fair value of equity-settled share-based payment arrangements are measured at grant date using the Trinomial Tree
Option Pricing Model and Monte Carlo simulations. Service and non-market performance conditions attached to the
arrangements are not taken into account in measuring fair value.
4. PRINCIPAL subsidiaries
As at 31 December 2015, the Group's most significant subsidiaries were the following:
Country of Shareholding
Name Project incorporation interest
Scorpio Bay Holdings Limited Scorpio Bay Resort Cyprus 100%
Scorpio Bay Resorts S.A. Scorpio Bay Resort Greece 100%
Latirus Enterprises Limited Sitia Bay Golf Resort Cyprus 80%
Iktinos Techniki Touristiki S.A. ('Iktinos') Sitia Bay Golf Resort Greece 78%
Xscape Limited Lavender Bay Resort Cyprus 100%
Golfing Developments S.A. Lavender Bay Resort Greece 100%
MindCompass Overseas Limited Kilada Hills Golf Resort Cyprus 100%
MindCompass Overseas S.A. Kilada Hills Golf Resort Greece 100%
MindCompass Overseas Two S.A. Kilada Hills Golf Resort Greece 100%
MindCompass Parks S.A. Kilada Hills Golf Resort Greece 100%
Dolphin Capital Greek Collection Limited Kilada Hills Golf Resort Cyprus 100%
DCI Holdings One Limited ('DCI H1') Aristo Developers BVIs 100%
D.C. Apollo Heights Polo and Country Resort Limited Apollo Heights Resort Cyprus 100%
Symboula Estates Limited Apollo Heights Resort Cyprus 100%
DolphinCI Fourteen Limited ('DCI 14') Amanzoe Cyprus 100%
Eidikou Skopou Dekatessera S.A. ('ES 14') Amanzoe Greece 100%
Eidikou Skopou Dekaokto S.A. ('ES 18') Amanzoe Greece 100%
Single Purpose Vehicle Two Limited ('SPV 2') Amanzoe Cyprus 68%
Eidikou Skopou Eikosi Ena S.A. Amanzoe Greece 68%
Azurna Uvala D.o.o. ('Azurna') Livka Bay Resort Croatia 100%
Eastern Crete Development Company S.A. Plaka Bay Resort Greece 100%
DolphinLux 2 S.a.r.l. La Vanta- Mediterra Resorts Luxembourg 100%
Kalkan Yapi ve Turizm A.S. ('Kalkan') La Vanta- Mediterra Resorts Turkey 100%
Dolphin Capital Americas Limited BVIs 100%
DCA Pearl Holdings Limited Pearl Island BVIs 100%
DCA Holdings Six Limited Playa Grande Club & Reserve BVIs 100%
DCA Holdings Seven Limited Playa Grande Club & Reserve BVIs 100%
DCI Holdings Seven Limited ('DCI H7') BVIs 100%
Playa Grande Holdings Inc. ('PGH') Playa Grande Club & Reserve Dominican Republic 100%
Single Purpose Vehicle Eight Limited Triopetra Cyprus 100%
Eidikou Skopou Dekapente S.A. Triopetra Greece 100%
Single Purpose Vehicle Ten Limited ('SPV 10') Kea Resort Cyprus 67%
Eidikou Skopou Eikosi Tessera S.A. Kea Resort Greece 67%
Pearl Island Limited S.A. Pearl Island Panama Republic 60%
Zoniro (Panama) S.A. Pearl Island Panama Republic 60%
The above shareholding interest percentages are rounded to the nearest integer.
As at 31 December 2015 and 31 December 2014, all or part of the shares held by the Company in some of its subsidiaries are
pledged as a security for loans (see note 23).
5. Significant accounting policies
The principal accounting policies adopted in the preparation of these consolidated financial statements are set out below.
These policies have been consistently applied to all periods presented in these consolidated financial statements unless
otherwise stated.
5.1 Subsidiaries
Subsidiaries are those entities, including special purpose entities, controlled by the Group. The financial statements of
subsidiaries are included in the consolidated financial statements from the date that control commences until the date that
control ceases.
5.2 Transactions eliminated on consolidation
Intra-group balances and any unrealised gains and losses arising from intra-group transactions are eliminated in preparing
the consolidated financial statements. Unrealised gains arising from transactions with associates are eliminated to the
extent of the Group's interest in the entity. Unrealised losses are eliminated in the same way as unrealised gains, but
only to the extent that there is no evidence of impairment.
5.3 Business combinations
Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which
control is transferred to the Group. Control is the power to govern the financial and operating policies of an entity so as
to obtain benefits from its activities. In assessing control, the Group takes into consideration potential voting rights
that currently are exercisable.
The Group measures goodwill at the acquisition date as the fair value of the consideration transferred, plus the recognised
amount of any non-controlling interests in the acquiree, plus if the business combination is achieved in stages, the fair
value of the existing equity interest in the acquiree, less the net recognised amount (generally fair value) of the
identifiable assets acquired and liabilities assumed.
When the excess is negative, a bargain purchase gain is recognised immediately in profit or loss. The consideration
transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally
recognised in profit or loss. Costs related to the acquisition, other than those associated with the issue of debt or
equity securities, that the Group incurs in connection with a business combination are expensed as incurred. Any
contingent consideration payable is recognised at fair value at the acquisition date. If the contingent consideration is
classified as equity, it is not remeasured and settlement is accounted for within equity. Otherwise, subsequent changes to
the fair value of the contingent consideration are recognised in profit or loss. The interest of non-controlling
shareholders in the acquiree is initially measured at the non-controlling shareholders' proportion of the net fair value of
the assets, liabilities and contingent liabilities recognised.
5.4 Interest in equity-accounted investees
Associates are those entities in which the Group has significant influence, but not control, over the financial and
operating policies. Significant influence is presumed to exist when the Group holds between 20% and 50% of the voting
power of another entity. Associates are accounted for using the equity method (equity accounted investees) and are
initially recognised at cost. The Group's investment includes goodwill identified on acquisition, net of any accumulated
impairment losses. The consolidated financial statements include the Group's share of the income and expenses and equity
movements of equity accounted investees, after adjustments to align the accounting policies with those of the Group, from
the date that significant influence commences until the date that significant influence ceases. When the Group's share of
losses exceeds its interest in an equity accounted investee, the carrying amount of that interest (including any long-term
investments) is reduced to nil and the recognition of further losses is discontinued except to the extent that the Group
has an obligation or has made payments on behalf of the investee.
5.5 Investment property
Investment property is property held either to earn rental income or for capital appreciation or for both, but not for sale
in the ordinary course of the business, use in the production or supply of goods or services or for administration
purposes. Investment property is initially measured at cost and subsequently at fair value with any change therein
recognised in profit or loss.
Cost includes expenditure that is directly attributable to the acquisition of the investment property. The cost of
self-constructed investment property includes the cost of materials and direct labour, any other costs directly
attributable to bringing the investment property to a working condition for their intended use and capitalised borrowing
costs.
Any gain or loss on disposal of an investment property (calculated as the difference between the net proceeds from disposal
and the carrying amount of the item) is recognised in profit or loss. When an investment property that was previously
classified as property, plant and equipment is sold, any related amount included in the revaluation reserve is transferred
to retained earnings.
When the use of property changes such that it is reclassified as property, plant and equipment, its fair value at the date
of reclassification becomes its cost for subsequent accounting.
A property interest under an operating lease is classified and accounted for as an investment property on a
property-by-property basis when the Group holds it to earn rentals or for capital appreciation or both. Any such property
interest under an operating lease classified as an investment property is carried at fair value. Lease payments are
accounted for as described in accounting policy 5.10.
5.6 Property, plant and equipment
Land and buildings are carried at fair value, based on valuations by external independent valuers, less subsequent
depreciation for buildings. Revaluations are carried out with sufficient regularity such that the carrying amount does not
differ materially from that which would be determined using fair value at the statement of financial position date. All
other property, plant and equipment are stated at cost less accumulated depreciation and impairment losses.
Increases in the carrying amount arising on revaluation of property, plant and equipment are credited to fair value reserve
in shareholders' equity. Decreases that offset previous increases of the same asset are charged against that reserve; all
other decreases are recognised in profit or loss.
The cost of self-constructed assets includes the cost of materials, direct labour, the initial estimate, where relevant, of
the costs of dismantling and removing the items and restoring the site on which they are located, and appropriate
proportion of production overheads.
Depreciation charge is recognised in profit or loss on a straight-line basis over the estimated useful lives of items of
property, plant and equipment, unless it constitutes part of the cost of another asset in which case is included in this
asset's carrying amount. Freehold land is not depreciated.
The annual rates of depreciation are as follows:
Buildings 3%
Machinery and equipment 10% - 33.33%
Motor vehicles and other 10% - 20%
The Group recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such
an item when that cost is incurred if it is probable that the future economic benefits embodied with the item will flow to
the Group and the cost of the item can be measured reliably. All other costs are recognised in profit or loss as
incurred.
5.7 Assets held for sale
Non-current assets, or disposal groups comprising assets and liabilities, are classified as held for sale if it is highly
probable that they will be recovered primarily through sale rather than through continuing use.
Such assets, or disposal groups, are generally measured at the lower of their carrying amount and fair value less costs to
sell. Any impairment loss on a disposal group is allocated first to goodwill, and then to the remaining assets and
liabilities on a pro rata basis, except that no loss is allocated to investment property, trading properties, financial
assets, deferred tax assets, which continue to be measured in accordance with the Group's other accounting policies.
Impairment losses on initial classification as held for sale and subsequent gains and losses on remeasurement are
recognised in profit or loss.
Once classified as held for sale, property, plant and equipment is no longer depreciated, and any equity-accounted investee
is no longer equity accounted.
5.8 Trading properties
Trading properties (inventory) are shown at the lower of cost and net realisable value. Net realisable value is the
estimated selling price in the ordinary course of the business less the estimated costs of completion and the estimated
costs necessary to make the sale. Cost of trading properties is determined on the basis of specific identification of their
individual costs and represents the fair value paid at the date that the land was acquired by the Group.
5.9 Work in progress
Work in progress is stated at cost plus any attributable profit less any foreseeable losses and less amounts received or
receivable as progress payments. The cost of work in progress includes materials, labour and direct expenses plus
attributable overheads based on a normal level of activity.
5.10 Leased assets
Leases under the terms of which the Group assumes substantially all the risks and rewards of ownership are classified as
finance leases. Property held under operating leases that would otherwise meet the definition of investment property may be
classified as investment property on a property-by-property basis. Such property is accounted for as if it were a finance
lease and the fair value model is used for the asset recognised. Minimum lease payments on finance leases are apportioned
between the finance charge and the reduction of the outstanding liability. The finance charge is allocated to each period
during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.
5.11 Trade and other receivables
Trade and other receivables are stated at their cost less impairment losses (see accounting policy 5.22).
5.12 Financial assets
The classification of the Group's investments in equity securities depends on the purpose for which the investments were
acquired. Management determines the classification of investments at initial recognition and re-evaluates this designation
at every statement of financial position date.
Available-for-sale financial assets
Investments intended to be held for an indefinite period of time, which may be sold in response to needs for liquidity or
changes in interest rates, are classified as available for sale. These are included in non-current assets unless management
has the express intention of holding the investment for less than 12 months from the reporting date or unless they will
need to be sold to raise operating capital, in which case they are included in current assets. Unrealised gains and losses
arising from changes in the fair value of available-for-sale financial assets are recognised in other comprehensive income
and then in equity. When available-for-sale financial assets are sold or impaired, the accumulated fair value adjustments
are included in profit or loss. In respect of available-for-sale equity securities, impairment losses previously recognised
in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is
recognised in other comprehensive income and accumulated under the heading of fair value reserve.
5.13 Cash and cash equivalents
Cash and cash equivalents comprise cash deposited with banks and bank overdrafts repayable on demand. Cash equivalents are
short-term, highly-liquid investments that are readily convertible to known amounts of cash and which are subject to an
insignificant risk of changes in value. Bank overdrafts that are repayable on demand and form an integral part of the
Group's cash management are included as a component of cash and cash equivalents for the purpose of the consolidated
statement of cash flows.
5.14 Share capital and premium
Share capital represents the issued amount of shares outstanding at their par value. Any excess amount of capital raised is
included in share premium. External costs directly attributable to the issue of new shares, other than on a business
combination, are shown as a deduction, net of tax, in share premium from the proceeds. Share issue costs incurred directly
in connection with a business combination are included in the cost of acquisition.
5.15 Own shares
When share capital recognised as equity is repurchased, the amount of the consideration paid, which includes directly
attributable costs, net of any tax effects, is recognised as a reduction from equity. Repurchased shares are classified as
own shares and are presented as a reduction from total equity. When own shares are sold or reissued subsequently, the
amount received is recognised as an increase in equity, and the resulting surplus or deficit on the transaction is
transferred to share premium.
5.16 Dividends
Dividends are recognised as a liability in the period in which they are declared and approved and are subtracted directly
from retained earnings.
5.17 Interest-bearing borrowings
Interest-bearing borrowings are recognised initially at fair value, less attributable transaction costs. Subsequent to
initial recognition, interest-bearing borrowings are stated at amortised cost with any difference between cost and
redemption value being recognised in profit or loss over the period of the borrowings on an effective interest basis.
5.18 Trade and other payables
Trade and other payables are stated at their cost.
5.19 Prepayments from clients
Payments received in advance on development contracts for which no revenue has been recognised yet, are recorded as
prepayments from clients as at the statement of financial position date and carried under creditors. Payments received in
advance on development contracts for which revenue has been recognised, are recorded as prepayments from clients to the
extent that they exceed revenue that was recognised in profit or loss as at the statement of financial position date.
5.20 Provisions
A provision is recognised in the consolidated statement of financial position when the Group has a legal or constructive
obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle
the obligation. If the effect is material, provisions are determined by discounting the expected future cash flows at a
pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific
to the liability.
5.21 Expenses
Investment Manager remuneration, directors' remuneration, operational expenses, professional fees, administrative and other
expenses are accounted for on an accrual basis. Expenses are charged to profit or loss, except for expenses incurred on the
acquisition of an investment property, which are included within the cost of that investment. Expenses arising on the
disposal of an investment property are deducted from the disposal proceeds.
5.22 Impairment
The carrying amounts of the Group's assets, other than investment property (see accounting policy 5.5) and deferred tax
assets (see accounting policy 5.31), are reviewed at each statement of financial position date to determine whether there
is any indication of impairment. If any such indication exists, the assets' recoverable amount is estimated. The
recoverable amount is the greater of the net selling price and value in use of an asset. In assessing value in use of an
asset, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects
current market assessments of the time value of money and the risks specific to the asset.
An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its
recoverable amount. Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of
cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to cash-generating units
and then, to reduce the carrying amount of the other assets in the unit on a pro rata basis.
5.23 Revenue recognition
Revenue comprises the invoiced amount for the sale of goods and services net of value added tax, rebates and discounts.
Revenues earned by the Group are recognised on the following bases:
Income from land and buildings under development
The Group applies IAS 18 'Revenue' for income from land and buildings under development, according to which revenue and the
related costs are recognised in profit or loss when the building has been completed and delivered and all associated risks
have been transferred to the buyer.
Construction contracts
Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to
the stage of completion of the contract activity at the statement of financial position date, as measured by the proportion
that contract costs incurred for work performed to date compared to the estimated total contract costs, except where this
would not be representative of the stage of completion. Variations in contract work, claims and incentive payments are
included to the extent that they have been agreed with the customer.
Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of
contract costs incurred that it is probable they will be recoverable. Contract costs are recognised as expenses in the
period in which they are incurred. When it is probable that total contract costs will exceed total contract revenue, the
expected loss is recognised as an expense immediately.
5.24 Equity-settled share-based payment arrangements
The grant-date fair value of equity-settled share-based arrangements is generally recognised as an expense, with a
corresponding increase in equity, over the vesting period of the awards. The grant-date fair value is measured to reflect
market performance conditions and there is no true-up for differences between expected and actual outcomes. The amount
recognised as an expense, is adjusted to reflect the number of awards for which the related service and non-market
performance conditions are expected to be met, such that the amount ultimately recognised is based on the number of awards
that meet the related service and non-market performance conditions at the vesting date. For share-based payment awards
with non-vesting conditions, the grant-date fair value is measured to reflect such conditions and there is no true-up for
differences between expected and actual outcomes.
5.25 Finance income and costs
Finance income comprises interest income on funds invested, dividend income and gains on the disposal of and increase in
the fair value of financial assets at fair value through profit or loss. Interest income is recognised as it accrues in
profit or loss, using the effective interest method.
Finance costs comprise interest expense on borrowings, unwinding of the discount on provisions and losses on the disposal
of and reduction in the fair value of financial assets at fair value through profit or loss.
The interest expense component of finance lease payments is recognised in profit or loss using the effective interest
method.
5.26 Foreign currency translation
Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange
rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting
date are retranslated to the functional currency at the exchange rate at that date. The foreign currency gain or loss on
monetary items is the difference between amortised cost in the functional currency at the beginning of the period, adjusted
for effective interest and payments during the period, and the amortised cost in foreign currency translated at the
exchange rate at the end of the period. Non-monetary assets and liabilities denominated in foreign currencies that are
measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was
determined. Foreign currency differences arising on retranslation are recognised in profit or loss.
5.27 Foreign operations
The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are
translated to Euro at exchange rates at the reporting date. The income and expenses of foreign operations, excluding
foreign operations in hyperinflationary economies, are translated to Euro at exchange rates at the dates of the
transactions.
The income and expenses of foreign operations in hyperinflationary economies are translated to Euro at the exchange rate at
the reporting date. Prior to translating the financial statements of foreign operations in hyperinflationary economies,
their financial statements for the current period are restated to account for changes in the general purchasing power of
the local currency. The restatement is based on relevant price indices at the reporting date.
Foreign currency differences are recognised directly in equity in the foreign currency translation reserve. When a foreign
operation is disposed of, in part or in full, the relevant amount in the foreign currency translation reserve is
transferred to profit or loss.
5.28 Segment reporting
A segment is a distinguishable component of the Group that is engaged either in providing products or services (operating
segment), or in providing products or services within a particular economic environment (geographical segment), which is
subject to risks and rewards that are different from those of other segments. Segment results that are reported to the
Group's chief operating decision maker include items directly attributable to a segment as well as those that can be
allocated on a reasonable basis.
5.29 Earnings per share
The Group presents basic and diluted (if applicable) earnings per share ('EPS') data for its shares. Basic EPS is
calculated by dividing the profit or loss attributable to shareholders of the Company by the weighted average number of
shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to
shareholders and the weighted average number of shares outstanding for the effects of all dilutive potential shares.
5.30 NAV per share
The Group presents NAV per share by dividing the total equity attributable to owners of the Company by the number of shares
outstanding as at the statement of financial position date.
5.31 Taxation
Taxation comprises current and deferred tax. Taxation is recognised in profit or loss, except to the extent that it relates
to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially
enacted at the statement of financial position date, and any adjustment to tax payable in respect of previous years.
Deferred tax is recognised using the statement of financial position method, providing for temporary differences between
the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is not recognised for the following temporary differences: the initial recognition of assets or liabilities in
a transaction that is not a business combination and that affects neither accounting nor taxable profit, and differences
relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will
not reverse in the foreseeable future. In addition, deferred tax is not recognised for taxable temporary differences
arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied
to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the
reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current
tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or
on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets
and liabilities will be realised simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences to the extent
that it is probable that future taxable profits will be available against which the temporary difference can be utilised.
Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that
the related tax benefit will be realised.
In determining the amount of current and deferred tax, the Group takes into account the impact of uncertain tax positions
and whether additional taxes and interest may be due. This assessment relies on estimates and assumptions and may involve
a series of judgements about future events. New information may become available that causes the Group to change its
judgement regarding the adequacy of existing tax liabilities; such changes to the tax liabilities will impact tax expense
in the period that such a determination is made.
5.32 Government grants
Government grants are recognised when there is reasonable assurance that the Group will comply with the conditions
attaching to them and that the grants will be received. Government grants related to non-current assets are recognised as
deferred income that is recognised in profit or loss on a systematic basis over the useful life of the asset. Government
grants that relate to expenses are recognised in profit or loss as revenue.
5.33 Comparatives
Where necessary, comparative figures have been adjusted to conform to changes in presentation in the current year.
6. revenue
From 1 January 2015 to 31 December 2015 From 1 January 2014 to 31 December 2014
E'000 E'000
Income from hotel operations 10,815 8,733
Income from operation of golf courses 155 125
Income from construction contracts 5,700 13,416
Sale of trading and investment properties 34,629 16,166
Rental income 329 389
Other income 278 2,376
Total 51,906 41,205
7. OPERATING EXPENSES
From 1 January 2015 to 31 December 2015 From 1 January 2014 to 31 December 2014
E'000 E'000
Cost of sales related to:
Hotel operations 3,997 2,894
Golf course operations 470 254
Construction contracts 3,147 9,219
Sales of trading and investment properties 29,926 13,385
Commission to agents and other 358 203
Electricity and fuel 307 448
Concession/write off of land (see note 15) 2,607 -
Personnel expenses (see below) 8,975 8,305
Branding management fees 3,552 2,489
Other operating expenses 1,676 1,410
Total 55,015 38,607
Personnel expenses
From 1 January 2015to 31 December 2015
Hotel & leisure operations Project maintenance & development Total Construction in progress
E'000 E'000 E'000 E'000
Wages and salaries 3,910 2,482 6,392 74
Compulsory social security contributions 891 800 1,691 3
Contributions to defined contribution plans - 29 29 -
Other personnel costs 422 441 863 -
Total 5,223 3,752 8,975 77
The average number of employees employed by the Group during the year were 229 157 386 2
From 1 January 2014to 31 December 2014
Hotel & leisure operations Project maintenance & development Total Construction in progress
E'000 E'000 E'000 E'000
Wages and salaries 3,445 2,559 6,004 267
Compulsory social security contributions 848 761 1,609 26
Contributions to defined contribution plans - 43 43 35
Other personnel costs 236 413 649 19
Total 4,529 3,776 8,305 347
The average number of employees employed by the Group during the year were 209 157 366 8
Personnel expenses in relation to operating expenses are expensed as incurred in profit or loss. Personnel expenses in
relation to construction in progress are capitalised on the specific projects and transferred to profit or loss through
cost of sales when the specific property is disposed of.
8. SEGMENT REPORTING
Operating segments
The Group has two reportable operating segments, the 'Hotel & leisure operations' and 'Construction & development segments.
Information related to each operational reportable segment is set out below. Segment profit/(loss) before tax is used to
measure performance as management believes such information is the most relevant in evaluating the results of the
respective segments relative to other entities that operate in the same industries.
Hotel & leisure operations Construction & development Other Reportable segments'totals
E'000 E'000 E'000 E'000
31 December 2015
Revenue 10,970 40,650 286 51,906
Net change in fair value of investment property - - (45,047) (45,047)
Ιmpairment loss on trading properties - (3,431) - (3,431)
Operating expenses (10,780) (41,917) (2,318) (55,015)
Investment Manager remuneration - - (13,128) (13,128)
Directors' remuneration - - (904) (904)
Depreciation charge (2,465) (14) (440) (2,919)
Professional fees - (2,753) (5,411) (8,164)
Administrative and other expenses - (2,258) (3,842) (6,100)
Results from operating activities (2,275) (9,723) (70,804) (82,802)
Finance income 1 1 104 106
Finance costs (2,682) (4,618) (13,555) (20,855)
Net finance costs (2,681) (4,617) (13,451) (20,749)
Share of losses on equity-accounted investees, net of tax (1,011) (43,542) - (44,553)
Impairment loss and write offs of property, plant and equipment (14,462) - (785) (15,247)
Gain on disposal of investments in subsidiaries - 823 - 823
Impairment loss on remeasurement of disposal groups - - (763) (763)
Loss before tax (20,429) (57,059) (85,803) (163,291)
Taxation - 633 14,663 15,296
Loss (20,429) (56,426) (71,140) (147,995)
Hotel & leisure operations Construction & development Other Reportable segments'totals
E'000 E'000 E'000 E'000
31 December 2014
Revenue 8,858 29,971 2,376 41,205
Net change in fair value of investment property - - 18,576 18,576
Impairment on trading properties - (6,216) - (6,216)
Operating expenses (9,016) (27,608) (1,983) (38,607)
Investment Manager remuneration - - (13,671) (13,671)
Directors' remuneration - - (159) (159)
Depreciation charge (2,641) (237) (361) (3,239)
Professional fees - (1,772) (5,656) (7,428)
Administrative and other expenses - (610) (4,942) (5,552)
Results from operating activities (2,799) (6,472) (5,820) (15,091)
Finance income 13 1 311 325
Finance costs (2,661) (2,728) (10,570) (15,959)
Net finance costs (2,648) (2,727) (10,259) (15,634)
Share of profit on equity-accounted investees, net of tax (2,428) 52,574 - 50,146
Impairment loss and write offs of property, plant and equipment (31) 40 648 657
Gain on disposal of investments in subsidiaries (212) 2,709 - 2,497
Profit on dilution in equity-accounted investees 149 - - 149
(Loss)/profit before tax (7,969) 46,124 (15,431) 22,724
Taxation - 223 1,365 1,588
(Loss)/profit (7,969) 46,347 (14,066) 24,312
Geographical segments
Information in relation to the geographical regions in which the Group operates, is set below:
Americas1E'000 South-East Europe2 Other3E'000 Reportable segment totalsE'000 Adjustments4 E'000 ConsolidatedtotalsE'000
E'000
31 December 2015
Property, plant and equipment 102,920 84,095 - 187,015 - 187,015
Investment property 141,906 198,947 - 340,853 - 340,853
Trading properties 2,052 35,335 - 37,387 - 37,387
Equity-accounted investees - 188,637 - 188,637 - 188,637
Available-for-sale financial assets 2,201 - - 2,201 - 2,201
Cash and cash equivalents 2,117 6,218 33,655 41,990 - 41,990
Assets held for sale - 70,240 - 70,240 - 70,240
Intra-group debit balances 14,195 291,448 555,516 861,159 (861,159) -
Other assets 3,141 13,195 841 17,177 - 17,177
Total assets 268,532 888,115 590,012 1,746,659 (861,159) 885,500
Loans and borrowings 57,550 92,395 73,735 223,680 - 223,680
Finance lease liabilities 28 3,005 - 3,033 - 3,033
Deferred tax liabilities 2,432 27,697 - 30,129 - 30,129
Liabilities held for sale - 18,125 - 18,125 - 18,125
Intra-group credit balances 144,154 417,371 299,634 861,159 (861,159) -
Other liabilities 27,865 65,260 880 94,005 - 94,005
Total liabilities 232,029 623,853 374,249 1,230,131 (861,159) 368,972
Revenue 4,226 47,680 - 51,906 - 51,906
Net change in fair value of investment property 8,116 (53,163) - (45,047) - (45,047)
Impairment losses (13,349) (6,092) - (19,441) - (19,441)
Share of loss on equity-accounted investees, net of tax - (44,553) - (44,553) - (44,553)
Other non-operating profits - 823 - 823 - 823
Investment Manager remuneration - (2,032) (11,096) (13,128) - (13,128)
Net finance costs (3,104) (12,826) (4,819) (20,749) - (20,749)
Other expenses (10,568) (58,272) (4,262) (73,102) - (73,102)
Loss before taxation (14,679) (128,435) (20,177) (163,291) - (163,291)
Taxation (62) 15,358 - 15,296 - 15,296
Loss (14,741) (113,077) (20,177) (147,995) - (147,995)
Americas1E'000 South-East Europe2 Other3E'000 Reportable segment totalsE'000 Adjustments4 E'000 ConsolidatedtotalsE'000
E'000
31 December 2014
Property, plant and equipment 75,996 100,769 - 176,765 - 176,765
Investment property 120,285 331,595 - 451,880 - 451,880
Trading properties 1,837 50,486 - 52,323 - 52,323
Equity-accounted investees - 231,996 2,227 234,223 - 234,223
Available-for-sale financial assets 2,201 - - 2,201 - 2,201
Cash and cash equivalents 20,514 7,662 2,802 30,978 - 30,978
Intra-group debit balances 13,274 285,185 507,763 806,222 (806,222) -
Other assets 2,673 19,729 3,877 26,279 - 26,279
Total assets 236,780 1,027,422 516,669 1,780,871 (806,222) 974,649
Loans and borrowings 43,128 113,801 83,160 240,089 - 240,089
Finance lease liabilities 134 7,961 - 8,095 - 8,095
Deferred tax liabilities 2,139 53,041 - 55,180 - 55,180
Intra-group credit balances 125,522 393,200 287,500 806,222 (806,222) -
Other liabilities 9,045 73,495 933 83,473 - 83,473
Total liabilities 179,968 641,498 371,593 1,193,059 (806,222) 386,837
Revenue 5,615 35,590 - 41,205 - 41,205
Net change in fair value of investment property 12,311 6,265 - 18,576 - 18,576
Impairment losses - (5,559) - (5,559) - (5,559)
Share of profit on equity-accounted investees, net of tax - 50,040 106 50,146 - 50,146
Other non-operating profits - 2,709 (63) 2,646 - 2,646
Investment Manager remuneration - - (13,671) (13,671)
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