REG - Livermore Inv. Group - Interim Results <Origin Href="QuoteRef">AUIV.L</Origin> - Part 3
28/09/2016 07:06
- Part 3: For the preceding part double click ID:nRSb0053Lb
0.81 0.77
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Number of Shares
Ordinary shares 304,120,401 304,120,401 304,120,401
Treasury shares (129,306,403) (108,830,818) (111,830,818)
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Closing number of ordinary shares in issue 174,813,998 195,289,583 192,289,583
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The Share options granted on 13 May 2008 have a dilutive effect on the net asset value per share, given that their exercise
price is lower than the net asset value per Company's share at 30 June 2016, 30 June 2015 and 31 December 2015. All other
share options do not impact the diluted net asset value per share at 30 June 2016, 30 June 2015 and 31 December 2015 as
their exercise price at these dates was higher than the net asset value per Company's share.
Repurchase of own shares
The Board believes that the ability of the Company to re-purchase its own Ordinary shares in the market may potentially
benefit equity shareholders of the Company. The repurchase of Ordinary shares at a discount to the underlying net asset
value enhances the net asset value per share of the remaining equity shares.
During the period, the Company bought an additional 17,475,585 ordinary shares at an average price of USD 0.45 per share.
19. Segment reporting
The Group's monitoring and strategic decision making process in relation to its investments, is separated into two activity
lines, which are also identified as the Group's operating segments. These operating segments are monitored and strategic
decisions are made on the basis of segment operating results.
Segment information can be analysed as follows:
Six months ended 30 June 2016 - Unaudited Equity and debtinstrumentsinvestmentactivities Investmentpropertyactivities Total perfinancialstatements
Segment results 2016 2016 2016
US $000 US $000 US $000
Investment income
Interest and dividend income 12,930 - 12,930
Investment property income - 2,580 2,580
Loss on investments (7,258) (102) (7,360)
------ ------ ------
Gross profit 5,672 2,478 8,150
Administrative expenses (1,677) (327) (2,004)
------ ------ ------
Operating profit 3,995 2,151 6,146
Finance costs (124) (582) (706)
Finance income 1,143 - 1,143
------ ------ ------
Profit before taxation 5,014 1,569 6,583
Taxation charge (5) (395) (400)
------ ------ ------
Profit for the period 5,009 1,174 6,183
------ ------ ------
Segment assets 121,235 126,604 247,839
------ ------ ------
Segment liabilities 15,298 82,307 97,605
------ ------ ------
Six months ended 30 June 2015 - Unaudited Equity and debtinstrumentsinvestmentactivities Investmentpropertyactivities Total perfinancialstatements
Segment results 2015 2015 2015
US $000 US $000 US $000
Investment income
Interest and dividend income 11,850 - 11,850
Investment property income - 2,738 2,738
Loss on investments (10,944) - (10,944)
------ ------ ------
Gross profit 906 2,738 3,644
Administrative expenses (1,535) (344) (1,879)
------ ------ ------
Operating (loss) / profit (629) 2,394 1,765
Finance costs (582) (694) (1,276)
Finance income 1,677 - 1,677
------ ------ ------
Profit before taxation 466 1,700 2,166
Taxation charge - (206) (206)
------ ------ ------
Profit for the period 466 1,494 1,960
------ ------ ------
Segment assets 126,416 125,143 251,559
------ ------ ------
Segment liabilities 19,762 73,960 93,722
------ ------ ------
Year ended 31 December 2015 - Audited Equity and debtinstrumentsinvestmentactivities Investmentpropertyactivities Total perfinancialstatements
Segment results 2015 2015 2015
US $000 US $000 US $000
Investment income
Interest and dividend income 25,675 - 25,675
Investment property income - 5,227 5,227
(Loss) / gain on investments (33,955) 7,819 (26,136)
------ ------ ------
Gross (loss) / profit (8,280) 13,046 4,766
Other income 35 - 35
Administrative expenses (4,510) (645) (5,155)
------ ------ ------
Operating (loss) / profit (12,755) 12,401 (354)
Finance costs (1,109) (1,345) (2,454)
------ ------ ------
(Loss) / profit before taxation (13,864) 11,056 (2,808)
Taxation charge - (1,951) (1,951)
------ ------ ------
(Loss) / profit for the year (13,864) 9,105 (4,759)
------ ------ ------
Segment assets 121,104 124,588 245,692
------ ------ ------
Segment liabilities 15,681 81,374 97,055
------ ------ ------
The Group's investment income and its investments are divided into the following geographical areas:
Six months ended 30 June 2016 - Unaudited Equity and debtinstrumentsinvestmentactivities Investmentpropertyactivities Total perfinancialstatements
2016 2016 2016
US $000 US $000 US $000
Investment Income
Switzerland - 2,478 2,478
Other European countries 192 - 192
United States 6,632 - 6,632
India (1,199) - (1,199)
Asia 47 - 47
------ ------ ------
5,672 2,478 8,150
------ ------ ------
Investments
Switzerland - 126,185 126,185
Other European countries 4,535 - 4,535
United States 85,896 - 85,896
India 8,912 - 8,912
Asia 4,318 - 4,318
------ ------ ------
103,661 126,185 229,846
------ ------ ------
Six months ended 30 June 2015 - Unaudited Equity and debtinstrumentsinvestmentactivities Investmentpropertyactivities Total perfinancialstatements
2015 2015 2015
US $000 US $000 US $000
Investment Income
Switzerland - 2,738 2,738
Other European countries (52) - (52)
United States 1,360 - 1,360
India (820) - (820)
Asia 418 - 418
------ ------ ------
906 2,738 3,644
------ ------ ------
Investments
Switzerland - 123,812 123,812
Other European countries 5,004 - 5,004
United States 74,931 - 74,931
India 12,475 - 12,475
Asia 4,686 - 4,686
------ ------ ------
97,096 123,812 220,908
------ ------ ------
Year ended 31 December 2015 - Audited Equity and debtinstrumentsinvestmentactivities Investmentpropertyactivities Total perfinancialstatements
2015 2015 2015
US $000 US $000 US $000
Investment Income
Switzerland - 13,046 13,046
Other European countries (22) - (22)
United States (5,950) - (5,950)
India (2,235) - (2,235)
Asia (73) (73)
------ ------ ------
(8,280) 13,046 4,766
------ ------ ------
Investments
Switzerland - 123,324 123,324
Other European countries 5,089 - 5,089
United States 72,030 - 72,030
India 10,004 - 10,004
Asia 3,825 - 3,825
------ ------ ------
90,948 123,324 214,272
------ ------ ------
Investment income, comprising interest and dividend income, gains or losses on investments, and investment property income,
is allocated on the basis of the customer's geographical location in the case of the investment property activities segment
and the issuer's location in the case of the equity and debt instruments investment activities segment. Investments are
allocated based on the issuer's location.
During the period, 82% of the investment property rent relates to rental income from a single customer (SBB - Swiss
national transport authority) in the investment property activities segment (June 2015: 89%, December 2015: 81.9%).
20. Interest and dividend income
Six monthsended 30 June2016Unaudited Six monthsended 30 June2015Unaudited Year ended31 December2015Audited
US $000 US $000 US $000
Interest from investments 63 63 127
Dividend income 12,867 11,787 25,548
------ ------ ------
12,930 11,850 25,675
------ ------ ------
21. Investment property income
Six monthsended 30 June2016Unaudited Six monthsended 30 June2015Unaudited Year ended31 December2015Audited
US $000 US $000 US $000
Gross rental income 2,728 2,862 5,634
Direct expenses (148) (124) (407)
------ ------ ------
2,580 2,738 5,227
------ ------ ------
All direct expenses relate to the generation of rental income.
22. Loss on investments
Six monthsended 30 June2016Unaudited Six monthsended 30 June2015Unaudited Year ended31 December2015Audited
US $000 US $000 US $000
Gain / (loss) on sale of investments - (577) (3,459)
Investment property revaluation (102) - 7,819
Loss due to impairment of available-for-sale financial assets (7,626) (10,828) (31,726)
Fair value gains / (losses) on financial assets through profit or loss 1,121 124 (320)
Fair value gain on associate - - 683
Fair value (losses) / gains on derivative instruments (694) 399 991
Bank custody fees (59) (62) (124)
------ ------ ------
(7,360) (10,944) (26,136)
------ ------ ------
The investments disposed of during the period resulted in the following realised gains / (losses) (i.e. in relation to
their original acquisition cost):
Six monthsended 30 June2016Unaudited Six monthsended 30 June2015Unaudited Year ended31 December2015Audited
US $000 US $000 US $000
Available-for-sale - (822) (5,723)
At fair value through profit or loss 46 (87) (303)
------ ------ ------
46 (909) (6,026)
------ ------ ------
23. Administrative expenses
Six monthsended 30 June2016Unaudited Six monthsended 30 June2015Unaudited Year ended31 December2015Audited
US $000 US $000 US $000
Legal expenses 61 55 188
Directors' fees and expenses 993 996 2,414
Professional and consulting fees 429 299 872
Other salaries and expenses 113 124 213
Office cost 167 153 358
Depreciation 3 4 16
Other operating expenses 206 213 447
Provision charge - - 513
Audit fees 32 35 134
------ ------ ------
2,004 1,879 5,155
------ ------ ------
24. Finance costs and income
Six monthsended 30 June2016Unaudited Six monthsended 30 June2015Unaudited Year ended31 December2015Audited
US $000 US $000 US $000
Finance costs
Bank interest on investment property loan 577 694 1,340
Other bank interest 129 114 267
Foreign exchange loss - 468 847
------ ------ ------
706 1,276 2,454
Finance income
Foreign exchange gain 1,143 1,677 -
------ ------ ------
NetFinance (income) / costs (437) (401) 2,454
------ ------ ------
25. Dividends
No dividends are declared for the period ended 30 June 2016.
The Board of Directors will decide on the Company's dividend policy for 2016 based on profitability, liquidity
requirements, portfolio performance, market conditions, and the share price of the Group relative to its NAV.
26. Earnings per share
Basic profit per share has been calculated by dividing the net profit attributable to ordinary shareholders of the parent
by the weighted average number of shares in issue of the parent during the relevant financial periods.
Diluted profit per share is calculated after taking into consideration other potentially dilutive shares in existence
during the period.
Six monthsended 30 June2016Unaudited Six monthsended 30 June2015Unaudited Year ended31 December2015Audited
Profit / (loss) for the period / year attributable to ordinary shareholders of the parent (USD 000) 6,183 1,960 (4,759)
--------- --------- ---------
Weighted average number of ordinary shares outstanding 186,255,695 195,289,583 194,599,172
--------- --------- ---------
Basic earnings per share (USD) 0.03 0.01 (0.02)
--------- --------- ---------
Weighted average number of ordinary shares outstanding 186,255,695 195,289,583 194,599,172
Dilutive effect of share options - 73,318 59,005
--------- --------- ---------
Weighted average number of ordinary shares including the effect of potentially dilutive shares 186,255,695 195,362,901 194,658,177
--------- --------- ---------
Diluted earnings per share (USD) 0.03 0.01 (0.02)
--------- --------- ---------
The Share options granted on 13 May 2008 have a dilutive effect on the weighted average number of ordinary shares only,
given that their exercise price is lower than the average market price of the Company's shares on the London Stock Exchange
(AIM division) during the period ended 30 June 2016, 30 June 2015 and the year ended 31 December 2015. All other share
options do not impact the diluted earnings per share for the period ended 30 June 2016, 30 June 2015 and the year ended 31
December 2015 as their exercise price was higher than the average market price of the Company's shares during the
corresponding periods.
27. Related party transactions
The Group is controlled by Groverton Management Ltd, an entity owned by Noam Lanir, which
at 30 June 2016 held 76.6% of the Company's effective voting rights.
30 June2016Unaudited 30 June2015Unaudited 31 December2015Audited
US $000 US $000 US $000
Amounts receivable from key management
Other assets 1,692 2,820 2,256 (1)
Directors' current accounts 2,527 2,512 2,514
------- ------- -------
4,219 5,332 4,770
------- ------- -------
Amounts payable to other related party
Loan payable (149) (499) (499) (2)
------- ------- -------
(149) (499) (499)
Amounts payable to key management
Directors' current accounts (41) (66) (35)
Other key management personnel - - (843)
------- ------- -------
(190) (565) (1,377)
------- ------- -------
Key management compensation
Short term benefits
Executive directors' fees 398 398 795 (3)
Executive directors' reward payments 564 564 1,528
Non-executive directors' fees 32 34 69
Non-executive directors' reward payments - - 22
Other key management fees 146 - 383
------- ------- -------
1,140 996 2,797
------- ------- -------
(1) Loans of USD 5.523m were made to a key management employee for the acquisition of shares in the Company. Interest was
payable on these loans at 6 month US LIBOR plus 0.25% per annum and the loans were secured on the shares acquired. The
loans were repayable on the earlier of the employee leaving the Company or April 2013. In December 2012 the Board decided
to renew the outstanding amount of these loans for a period of another five years. Based on the Board's decision, the
outstanding amount is reduced annually on a straight line over five years, as long as the key management employee remains
with the Company. The relevant reduction in the loan amount for the period was USD 0.564m. The loans are classified as
"other assets" and are included under trade and other receivables (note 11).
(2) A loan with a balance at 30 June 2016 of USD 0.149m (June 2015: USD 0.499m, December 2015: USD 0.499m) has been
received from related company Chanpak Ltd. The loan is free of interest, unsecured and repayable on demand. This loan is
included within trade and other payables (note 17).
(3) These payments were made directly to companies to which they are related.
No social insurance and similar contributions nor any other defined benefit contributions plan costs incurred for the Group
in relation to its key management personnel in either 2016 or 2015.
Noam Lanir, through an Israeli partnership, is the major shareholder of Babylon Limited, an Israel based Internet Services
Company. The Group as of 30 June 2016 held a total of 1.941m shares at a value of USD 1.092m (June 2015: 1.941m shares at a
value of USD 0.997m, December 2015: 1.941m shares at a value of USD 0.931m) which represents 4.0% of its effective voting
rights. The investment in Babylon Ltd is included within public equity investments under financial assets at fair value
through profit or loss (note 5).
During the period the Group received administrative services of USD 0.028m (June 2015: USD 0.021m, December 2015: USD
0.039m) in connection with investments from related company Mash Medical Life Tree Marketing Ltd.
During the period, the Company bought 17,475,585 of its ordinary shares (treasury shares - note 13) at an average price of
USD 0.45 per share from Groverton Management Ltd.
28. Litigation
Fairfield Sentry Ltd vs custodian bank and beneficial owners
One of the custodian banks that the Group uses faces a contingent claim up to USD 2.1m, and any interest as will be decided
by a US court and related legal fees, with regards to the redemption of shares in Fairfield Sentry Ltd, which were bought
in 2008 at the request of Livermore and on its behalf. The same case was also filed in BVI where the Privy Council ruled
against the plaintiffs.
As a result of the surrounding uncertainties over the existence of any obligation for Livermore, as well as for the
potential amount of exposure, the Directors cannot form an estimate of the outcome for this case and therefore no provision
has been made.
No further information is provided on the above case as the Directors consider it could prejudice its outcome.
Ex employee vs Empire Online Ltd
In 2007 an ex employee of Empire Online Limited (the Company's former name) filed a law suit against one of its Directors
and the Company in the Labor Court in Tel Aviv. According to the lawsuit the plaintiff claims compensation relating to the
sale of all commercial activities of Empire Online Limited until the end of 2006, and the dissolution of the company and
the terms of termination of his employment with Empire Online Limited.
Prior to the filing of the lawsuit in Israel, the Company filed a claim against the plaintiff in the Court in Cyprus based
upon claims concerning breach of faith of the plaintiff towards his employers. Litigation was completed in Israel.
On 5 March 2014, the Labor Court in Tel Aviv issued a ruling in which the court denied most of the plaintiff's claims and
accepted only his claim for termination of employment. On 16 April 2014 the plaintiff filed an appeal against the ruling.
On 10 June 2015 the court held a hearing of the appeal and suggested that both sides settle the dispute by means of
mediation. On 20 January 2016 the parties reached an agreement for an out of court settlement, for which a corresponding
provision has been made.
29. Commitments
As part of the lease extension agreement with SBB in 2015, the Group will invest up to a maximum of CHF 3.95m (USD 4.04m)
and SBB is expected to invest up to CHF 9m (USD 9.2m) to upgrade the property and allow for additional workspaces.
30. Events after the reporting date
In August 2016 loans of USD 2.5m were made to a key management employee. Interest is accrued on these loans at 6 month US
LIBOR plus 0.25% per annum. The loans are secured by shares of the Company of an equal market value as at the date of
grant, and (principal plus accumulated interest) are repayable on the earlier of the employee leaving the Company or 15
August 2019.
31. Preparation of interim financial statements
Interim condensed consolidated financial statements are unaudited. Consolidated financial statements for Livermore
Investments Group Limited for the year ended 31 December 2015, prepared in accordance with International Financial
Reporting Standards as adopted by the European Union, on which the auditors gave an unqualified audit report are available
from the Company's website www.livermore-inv.com.
Report by the Independent Auditors on Review of Condensed Interim Consolidated Financial Statements to the Board of
Directors of Livermore Investments Group Limited
Independent Review Report on the Interim Condensed Consolidated Financial Statements
We have reviewed the accompanying interim condensed consolidated financial statements of Livermore Investments Group
Limited (the ''Company'') and its subsidiaries (the ''Group'') on pages 9 to 36, which comprise the condensed consolidated
statement of financial position as at 30 June 2016 and the condensed consolidated statements of profit or loss,
comprehensive income, changes in equity and cash flows for the six months then ended, and other explanatory notes.
Board of Directors' Responsibility for the Interim Condensed Consolidated Financial Statements
The Company's Board of Directors is responsible for the preparation and fair presentation of these interim condensed
consolidated financial statements in accordance with International Accounting Standard 34 ''Interim Financial Reporting''
as adopted by the European Union.
Accountant's Responsibility
Our responsibility is to express a conclusion on these interim condensed consolidated financial statements based on our
review. We conducted our review in accordance with International Standard on Auditing 2410 ''Review of Interim Financial
Information Performed by the Independent Auditor of the Entity''. This Standard requires that we plan and perform the
review to obtain moderate assurance as to whether the interim condensed consolidated financial statements are free of
material misstatement.
A review of interim financial information is limited primarily to making inquiries of Company personnel and applying
analytical and other review procedures to financial data. A review is substantially less in scope than an audit conducted
in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we
would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit
opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed
consolidated financial statements do not present fairly, in all material respects, the financial position of Livermore
Investments Group Limited and its subsidiaries as at 30 June 2016 and of its financial performance and its cash flows for
the six month period then ended in accordance with International Accounting Standard 34 ''Interim Financial Reporting'' as
adopted by the European Union.
Other Matter
This report, including the conclusion, has been prepared for and only for the Company's members and for no other purpose.
We do not, in giving this conclusion, accept or assume responsibility for any other purpose or to any other person to whose
knowledge this report may come to.
Nicos Mouzouris
Certified Public Accountant and Registered Auditor
for and on behalf of
Grant Thornton (Cyprus) Ltd
Certified Public Accountants and Registered Auditors
Limassol, 27 September 2016
This information is provided by RNS
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