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    REG - Noida Toll Bridge Co - Half-year Report <Origin Href="QuoteRef">NOID.NS</Origin> - Part 1

    Picture of Noida Toll Bridge logoNoida Toll BridgeAnnouncement
    23/12/2016 09:35
    RNS Number : 7267S
    Noida Toll Bridge Co. Ltd.
    23 December 2016
    Noida Toll Bridge Company Limited
    ("NTBCL" or the "Company")
    Interim Results for the half year ended 30 September 2016
    Regd. Office: Toll Plaza, DND Flyway, Noida 201 301, Uttar Pradesh, India
    The Board of Directors of Noida Toll Bridge Company Limited ("NTBCL") is pleased to announce the Company's audited IFRS results for the half year ended 30 September 2016.
    Pursuant to terms of the Listing Agreement signed with the Indian Stock Exchanges, results under Indian Accounting Standards were released to the market on 13 December 2016 on AIM, BSE and NSE simultaneously.
    For further details, please contact: 
    Noida Toll Bridge Company Limited
    Harish Mathur 
    00 91 120 251 6380
    Cairn Financial Advisers LLP
    Sandy Jamieson, Emma Earl
    00 44 207 213 0880

     
       
    NOIDA TOLL BRIDGE COMPANY LIMITED AND ITS SUBSIDIARY COMPANY
    CONSOLIDATED CASH FLOW FOR THE HALF YEAR ENDED SEPTEMBER 30, 2016
    Half Year ended 
    Half Year ended 
    30 September 2016
    30 September 2015
    US$ 
    US$ 
    A. Cash Flow from Operating Activities
    Receipts from Customers
    10,640,519
    10,110,504
    Payment to Suppliers and Employees
    (2,331,938)
     (2,062,331)
    Deposits, Advances and Staff Loan
    (52,564)
    3,065 
    Purchase of Inventories
    8,377 
    6,142 
    Income Taxes Paid
    (1,952,586)
    (1,535,967)
    Net Cash from / (used in) Operating Activities (A)
    6,311,808 
    6,521,413 
    B. Cash Flow from Investment Activities
    Purchase of Fixed Assets
    (420,726)
    (1,401,056)
    Proceeds from Sale of Fixed Assets 
    152 
    1,205 
    Payment for Capital Advance
    (3,856,837)
     - 
    Purchase of 'Available for Sale' Investments
    (5,974,608)
    (5,246,769)
    Proceeds from sale of 'Available for Sale' Investments 
    6,919,244
    4,058,294
    Net Cash from/ (used in) Investment Activities (B)
    (3,332,775)
    (2,588,326)
     
    C. Cash flow from Financing Activities
    Dividends Paid (including tax thereon)
    (5,020,998)
    (3,489,033)
    Term Loans from Banks 
    2,539,208 
     - 
    Repayment of DDBs
     - 
     - 
    Repayment of Term Loan from Others
     - 
     - 
    Interest and Finance Charges Paid
    (377,700)
    (6,075)
    Net Cash from/ (used in) Financing Activities (C)
    (2,859,490)
    (3,495,108)
    Net Increase/ (Decrease) in Cash and Cash Equivalents (A+B+C)
    119,543 
    437,979 
    Net Foreign Exchange Difference
    (57,246)
    (63,183)
    Cash and Cash Equivalents (Opening Balance)- 
    649,760
    1,108,686
    Cash and Cash Equivalents (Closing Balance) - 
    712,057 
    1,483,482 
    NOIDA TOLL BRIDGE COMPANY LIMITED AND ITS SUBSIDIARY COMPANY
    CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE HALF YEAR ENDED SEPTEMBER 30, 2016
    Share capital
    Securities Premium
    Effect of Exchange Translation Reserve
    General Reserve
    Retained Earnings
    Net Unrealized Gains Reserve
    Debenture Redemption Reserve
    Equity
    Minority Interest
    Total Equity
    US$
    US$
    US$
    US$
    US$
    US$
    US$
    US$
    US$
    US$
    At 1st April 2015
     42,419,007 
     23,206,321 
     (17,847,236)
     882,835 
     24,021,142 
     - 
     863,956 
     73,546,025 
     (170,402)
     73,375,623 
    Net Profit during the period
    - 
    - 
    - 
     - 
     4,615,132 
    - 
     4,615,132 
     20,953 
     4,636,085 
    Fair value change on available for sale financial assets
     10,457 
     10,457 
     - 
     10,457 
    Dividend*
    - 
    - 
    - 
     - 
     (2,898,879)
    - 
    - 
     (2,898,879)
     - 
     (2,898,879)
    Dividend Tax
    - 
    - 
    - 
     - 
     (576,598)
    - 
    - 
     (576,598)
     - 
     (576,598)
    Difference for Currency Translation
     - 
     (1,111,954)
     (2,367,801)
     (42,302)
     - 
     - 
     (41,397)
     (3,563,454)
     7,684 
     (3,555,770)
    At September 30, 2015
     42,419,007 
     22,094,367 
     (20,215,037)
     840,533 
     25,160,797 
     10,457 
     822,559 
     71,132,683 
     (141,765)
     70,990,918 
    As at 1 April 2016
     42,419,007 
     21,897,839 
     (20,601,145)
     1,648,299 
     23,660,427 
     13,632 
     - 
     69,038,059 
     (156,753)
     68,881,306 
    Net Profit
     - 
     3,668,784 
     3,668,784 
     280,083 
     3,948,867 
    Fair value change on available for sale financial assets
     - 
     - 
     - 
     - 
     (36,367)
     7,155 
     - 
     (29,212)
     (29,212)
    Dividend*
     - 
     - 
     - 
     - 
     (4,171,732)
     - 
     - 
     (4,171,732)
     (4,171,732)
    Dividend Tax
     - 
     - 
     - 
     - 
     (852,961)
     - 
     - 
     (852,961)
     (852,961)
    Difference for Currency Translation
     - 
     (108,405)
     (227,328)
     (8,160)
     - 
     (68)
     - 
     (343,961)
     1,995 
     (341,966)
    At September 30, 2016
     42,419,007 
     21,789,434 
     (20,828,473)
     1,640,139 
     22,268,151 
     20,719 
     - 
     67,308,977 
     125,325 
     67,434,302 
    *Dividends paid and Proposed
    Half Year ended Sept 30,2016
    Half Year ended Sept 30,2015
    Final Dividend for 2014-15 @ US$ 0.023 per share
     2,898,879 
    Final Dividend for 2015-16 @ US$ 0.034 per share
     (4,171,732)
     (4,171,732)
     2,898,879 
    Notes to consolidated financial statement for the half year ended September 30, 2016
    1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 
    (a) Corporate Information 
    Noida Toll Bridge Company Limited (NTBCL) is a public limited company incorporated and domiciled in India on 8th April 1996 with its registered office at Toll Plaza, DND Flyway, Noida - 201301, Uttar Pradesh, India. The equity shares of NTBCL are publicly traded in India on the National Stock Exchange and Bombay Stock Exchange. NTBCL launched the issue of global depository receipts (GDRs) represented by equity shares in March 2006. The GDRs of NTBCL are traded on Alternate Investment Market (AIM) of the London Stock Exchange. 
    The NTBCL has been set up to develop, establish, construct, operate and maintain a project relating to the construction of the Delhi Noida Toll Bridge under the "Build-Own-Operate-Transfer" (BOOT) basis. The Delhi Noida Toll Bridge comprises the Delhi Noida Toll Bridge, adjoining roads and other related facilities, the Ashram flyover which has been constructed at the landfall of the Delhi Noida Toll Bridge and the Mayur Vihar Link and it operates under a single business and geographical segment (Refer Note 26). 
    The Group's consolidated financial statements are authorized for issue by the company's Board of Directors on December 13, 2016
    (b) Service Concession Arrangement entered into between IL&FS, NTBCL and NOIDA
    A 'Concession Agreement' entered into between the NTBCL, Infrastructure Leasing and Financial Services Limited (IL&FS, the promoter company) and the New Okhla Industrial Development Authority, Government of Uttar Pradesh, conferred the right to the Company to implement the project and recover the project cost, through the levy of fees/ toll revenue, with a designated rate of return over the 30 years concession period commencing from 30 December 1998 i.e. the date of Certificate of Commencement, or till such time the designated return is recovered, whichever is earlier. The Concession Agreement further provides that in the event the project cost together with the designated return is not recovered at the end of 30 years, the concession period shall be extended by 2 years at a time until the project cost and the return thereon is recovered. The rate of return is computed with reference to the project costs, cost of major repairs and the shortfall in the recovery of the designated returns in earlier years. As per the certification by the independent auditors, the total recoverable amount comprises project cost and 20% designated return. NTBCL shall transfer the Project Assets to the New Okhla Industrial Development Authority in accordance with the Concession Agreement upon the full recovery of the total cost of project and the returns thereon.
     In the past, New Okhla Industrial Development Authority (NOIDA) has been in discussion with the Company to consider modifications of a few terms of the Concession Agreement. Considering the recent developments, the Company at its 9th July 2015 Board meeting, approved the draft proposal (Subject to approval by NOIDA & Shareholders) for terminating the concession & handing over the bridge on March 31, 2031 & freezing the amount payable as on 31st March 2011.
    Hon'ble High Court of Allahabad had, vide its Judgement dated October 26, 2016 on a Public Interest Litigation filed in 2012 (challenging the validity of the Concession Agreement and seeking the Concession Agreement to be quashed) has directed the Company to stop collecting the user fee holding the two specific provisions relating to levy and collection of fee to be inoperative but refused to quash the Concession Agreement. Consequently, Collection of user fee from the users of the NOIDA bridge has been suspended from October 26, 2016 and an appeal has been filed before Hon'ble Supreme Court of India seeking an Interim Stay on the said Judgment. 
    On November 11, 2016, Hon'ble Supreme Court issued its Interim Order though denying the interim stay, sought assistance of CAG to submit a report whether the Total Cost of the Project in terms of the Concession Agreement has been recovered or not by the company. 
    Further the Company has also notified the NOIDA Authority that the Judgement of the Hon'ble Allahabad High Court read with Interim Order of the Hon'ble Supreme Court of India constitute a Change in law under the Concession Agreement and submitted a detailed proposal for modification of the Concession Agreement so as to place it in substantially the same legal, commercial and economic position as it was prior to the said Change in Law.
    Further details of concession agreement are given in Note 27.
    (c) Basis of preparation
     
    The consolidated financial statements of Noida Toll Bridge Company Limited and its subsidiary ('the Group') have been prepared in accordance with International Financial Reporting Standards (IFRS) and interpretations as laid down by the International Financial Reporting Interpretations Committee (IFRIC)
    These consolidated financial statements have been drawn up in accordance with the going-concern principle and on a historical cost basis, except for available-for sale investments that have been measured at fair value. The presentation and grouping of individual items in the statement of financial position, statement of comprehensive income and the statement of cash flow, as well as the changes in equity, are based on the principle of materiality.
    (d) Significant accounting judgments and estimates  
    The preparation of financial statements in conformity with IFRS requires management to make estimates, judgements and assumptions. Judgements and estimates are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.
    The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.
    Judgements
    In the process of applying the Group's accounting policies, management has made the following judgments, apart from those involving estimations, which have the most significant effect on the amounts recognized in the financial statements:
    Recognition of Concession Agreement as an Intangible Asset
    (i) Basis of accounting for the service concession
    The Group has determined that IFRIC 12 Service Concession Arrangements is applicable to the Concession Agreement and hence has applied it in accounting for the concession. 
    The directors have determined that the intangible asset model in IFRIC 12 Service Concession Arrangement is applicable to the concession. In particular, they note that users pay tolls directly so the grantor does not have the primary responsibility to pay the operator. 
    In order to facilitate the recovery of the project cost and 20% designated returns through collection of toll and development rights, the grantor has guaranteed extensions to the terms of the Concession, initially set at 30 years. The Group has received an "in-principle" approval for development rights from the grantor. However, the Group has not yet entered into any agreement with the grantor which would constitute an assurance from the grantor to facilitate the recovery of shortfalls. Management recognizes that the development right agreement when executed will give rise to intangible assets in their own right.
    Disclosures for Service Concession Arrangement as prescribed under SIC 29 Service Concession Arrangements - Disclosure have been incorporated into the financial statements.
    (ii) Significant assumptions in accounting for the intangible asset 
    On completion of construction of the Delhi Noida Toll Bridge (6 February 2001), the rights under the Concession Agreement have been recognized as an intangible asset, received in exchange for the construction services provided. Construction costs include besides others, expenditure incurred and provisions for outstanding capital commitments on the Ashram Flyover, which was significantly completed on the date of recognition of the intangible asset. This section of the bridge was commissioned on 30th October 2001. The intangible asset received has been measured at fair value of the construction services as of US$ 112,391,294 as on the date of commissioning. The Group has recognized a profit of US$ 32,591,491, which is the difference between the cost of construction services rendered (the cost of the project asset of US$ 79,799,802) and the fair value of the construction services. 
    The Directors have concluded that as operators of the bridge, they have provided construction services to NOIDA, the grantor, in exchange for an intangible asset, i.e. the right to collect toll from road-users during the Concession period. 
    Accordingly, the Group has measured the intangible asset at cost, i.e. the fair value of the construction services as at 6 February 2001, the date of completion of construction and commissioning of the asset.
    The key assumptions used in establishing the cost of the intangible asset are as follows:
     Construction of the DND Flyway commenced in 1998 and was completed on 6 February 2001. The exchange of construction services for an intangible asset is regarded as a transaction that generates revenue and costs, which have been recognized by reference to the stage of completion of the construction. Contract revenue has been measured at the fair value of the consideration receivable. Hence in each of the years of construction, construction revenue has been calculated at cost plus 17.5% and the corresponding construction profit has been recognized through retained earnings. 
     Management has capitalized qualifying finance expenses until the completion of construction. 
     The intangible asset is assumed to be received only upon completion of construction. Until then, management has recognized a receivable for its construction services. The fair value of construction services has been estimated to be equal to the construction costs plus margin of 17.5% and the effective interest rate of 13.5% for lending by the grantor. The construction industry margins range between 15-20% and management has determined that a margin of 17.5% is both conservative and appropriate. The effective interest rate used on the receivable during construction is the normal interest rate which grantor would have paid on delayed payments.
     The intangible asset has been recognized on the completion of construction, i.e. 6th February 2001.
     The management considers that they will not be able to earn the designated return under the Concession Agreement over 30 years. The company has an assured extension of the concession as required to achieve project cost and designated returns (see Note 1(b) above). Based on the independent professional expert's advice, the company had estimated the life of the bridge to be of 100 years. The intangible asset was being amortized over the same useful life under to unit of usage method. As the Company at its 9th July 2015 Board meeting, approved the draft proposal (Subject to approval by Noida & Shareholders) for terminating the concession & handing over the bridge on March 31, 2031, useful life of the Intangible Asset has been revised to 30 years.
     Development rights will be accounted for as and when exercised.
    Construction of the Mayur Vihar Link commenced in 2006-07. NTBCL has obtained land from Noida for the construction of the Mayur Vihar Link vide Supplement to Noida Land Lease Deed executed between them. As per the terms of said lease deed Mayur Vihar Link Road will form part of Noida Bridge Project and the expenditure incurred by NTBCL on it shall be included in the cost of Noida Bridge with respect to the concession agreement. As the Mayur Vihar Link fall under the jurisdiction of Delhi Government, Municipal Corporation of Delhi vide confirmation agreement dated 9th January 2005 agreed not to declare the Mayur Vihar Link as public street and to recognize the right of NTBCL to operate and maintain the Mayur Vihar Link as a private street and charge user a user the fees in respect thereof. This right has been recognized as an intangible asset, received in exchange for the construction services provided to the grantor of the concession agreement. The intangible asset received has been measured at fair value of construction services as of US $ 15,961,837. The Group has recognized a profit of US $ 3,662,423 which is the difference between the cost of construction services rendered (the cost of project asset of US$ 12,299,414) and the fair value of the construction services. 
    The key assumptions used in establishing the cost of the intangible asset (i.e. right to collect toll on Mayur Vihar Link) are as follows:
     Construction commenced in June 2006 and was completed on January 19, 2008. The exchange of construction services for an intangible asset is regarded as a transaction that generates revenue and costs, which have been recognized by reference to the stage of completion of the construction. Contract revenue has been measured at the fair value of the consideration receivable. Hence in each of the year of construction, construction revenue has been calculated at cost plus 17.5% and the corresponding construction profit has been recognized through construction revenue. 
     Management has capitalized qualifying finance expenses until the completion of construction.
     The intangible asset is assumed to be received upon the completion of the construction and during the construction phase, management has recognized it as additions to the Intangible assets. The fair value of construction services has been estimated to be equal to the construction costs plus margin of 17.5% and the effective interest rate of 12.5% for lending by the grantor. The construction industry margins range between 15-20% and management has determined that a margin of 17.5% is both conservative and appropriate. The effective interest rate used on the receivable during construction is the normal interest rate which grantor would have paid on borrowing obtained. 
     The management considers that they will not be able to earn the designated return under the Concession Agreement over 30 years. The company has an assured extension of the concession as required to achieve project cost and designated returns (see Note 1(b) above). As the lease period for the land is coterminous with the concession agreement, this intangible asset is being amortized over the remaining life of the Delhi Noida Toll Bridge from the date of commissioning of the Mayur Vihar Link Road under unit of usage method. As the Company at its 9th July 2015 Board meeting, approved the draft proposal (Subject to approval by Noida & Shareholders) for terminating the concession & handing over the bridge on March 31, 2031, useful life of the Intangible Asset has been revised to 30 years.
    2. Issued Capital 
    30-Sep-16
    31-Mar-16
    US$
    US$
    Authorized
    Ordinary Shares of Rs.10 each
    46,476,127
    46,476,127
    46,476,127
    46,476,127
    Issued and fully paid
    Number of shares *
    186,195,002
    186,195,002
    Share Capital (US$)
     42,419,007 
     42,419,007 
    *Includes 45,075 equity shares represented by 9,015 GDRs (Previous Year 45,075 equity shares represented by 9,015 GDRs) (Each GDR representing 5 ordinary shares of Rs. 10 each)
    The company has only one class of ordinary equity shares having a par value of Rs. 10 per share. Each holder of equity shares is entitled to one vote per share. Each holder of these ordinary shares is entitled to receive dividends as and when declared by the company.
    In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts. The distribution will be in proportionate to the number of equity shares held by the shareholders.
    Share Option Scheme
    NTBCL has two Employee Stock Option Plans (ESOP 2004, ESOP 2005). Under ESOP 2004 options to subscribe for the Company's shares have been granted to directors, senior executive and general employees. All Stock Options granted in the past have been exercised, allotted or have lapsed. Under ESOP 2005 no options have been granted up to the date of financial statement. 
    3. Earnings Per Share
    Basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the year. 
    Diluted earnings per share are calculated by dividing the net profit attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the year plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares.
    The following reflects the income and share data used in the basic and diluted earnings per share computations:
    30-Sep-16
    30-Sep-15
    US ($)
    US ($)
    Net Profit/(Loss) attributable to equity share holders 
    3,668,784
    4,615,132
    30-Sep-16
    30-Sep-15
    Weighted average number of ordinary shares for basic / diluted earnings per share
    186,195,002
    186,195,002
    4. AVAILABILITY OF INTERIM REPORT
    Copies of the Interim Report for the six months ended 30 September 2016 will shortly be available on the Company's website,www.ntbcl.com.

    This information is provided by RNS
    The company news service from the London Stock Exchange
      END
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