REG-Clear Leisure Plc: Interim Results <Origin Href="QuoteRef">CLPC.L</Origin>
18/09/2017 07:25
18 September 2017
Clear Leisure plc
("Clear Leisure", “the Group” or "the Company")
INTERIM RESULTS
For the 6 Months Ended 30 June 2017
Clear Leisure plc (AIM: CLP) announces its unaudited Interim Results for the 6
months ended 30 June 2017.
HIGHLIGHTS
*
Profit before tax of €2.14 million (GBP 1.84m)* (H1 2016: loss before tax of
€620,000 (GBP 533,200))
*
Operational Profit was €2.03 million (GBP 1.75m) (H1 2016: Operational loss
of €275,000 (GBP 236,500)
*
Undiluted Net Asset Value of €4.95 million (GBP 4.26m) (31 December 2016:
NAV was €1.6 million (GBP 1.38m))
*after an exceptional gain of €2.4 million (GBP 2.06m) on the repurchase of
debt at a discount of 76.15%
(currency conversion taken at GBP/EUR 1.16279)
For further information please contact:
Clear Leisure Plc
+39 335 296573 (tel:%2B390247951642)
Francesco Gardin, CEO and Executive Chairman
ZAI Corporate Finance (Nominated Adviser)
Tim Cofman/Jamie Spotswood/Peter Trevelyan-Clark
+44 (0)20 7060 2220
Peterhouse Corporate Finance (Joint Broker)
+44 (0) 20 7469 0935
Lucy Williams / Heena Karani
Cadogan Leander (Financial PR)
+44 (0) 7795 168 157
Christian Taylor-Wilkinson
About Clear Leisure Plc
Clear Leisure Plc (AIM: CLP) is an AIM listed investment company with a
portfolio of companies primarily encompassing the leisure and real estate
sectors mainly in Italy. The Company may be either a passive or active
investor and Clear Leisure’s investment rationale ranges from acquiring
minority positions with strategic influence through to larger controlling
positions. For further information, please visit, www.clearleisure.co.uk
Chairman Statement
Overview
During the first six months of the year, management remained focused on
securing control of the Company’s assets, principally through court led
recoveries of misappropriated assets and the acquisition of the debt of
subsidiaries at substantial discounts. These actions are essential if the
Company is to determine the best way to maximise the value of the assets for
the benefit of shareholders.
In pursuit of these objectives, Clear Leisure’s largest shareholder,
Eufingest, has demonstrated continuous support to the Company by making
available additional convertible loans during the first six months of 2017
amounting to €1.36 million, bringing the total amount borrowed from
Eufingest to €2.475 million.
In May, the Company agreed with Eufingest to consolidate all the outstanding
loans into one convertible facility of €2.475 million repayable by 28 April
2020 (the “Consolidated Loan”). The Consolidated Loan carries an interest
rate of 1 per cent and is secured by certain of the Group’s assets. At any
time before 28 April 2020, the Company may repay the Consolidated Loan
without penalty and Eufingest may convert the Consolidated Loan into shares at
the rate of 0.89 pence.
The additional funds provided by Eufingest enabled the Company to buy back,
at a 76.15% discount, €3.14 million of Mediapolis debt previously owed to
three Italian banks. The amount of €3.14 million now represents a secured
debt to the Company from its subsidiary, Mediapolis srl. The transaction
yielded a profit for the Group of approximately €2.4 million.
As first disclosed on 15 June, the Court Prosecutor of Ivrea, has filed a
winding up petition on Mediapolis srl. A first hearing was scheduled for
the 23 June at which the Court agreed to accept the submission of additional
debt settlement agreements reached with Mediapolis creditors. As a
consequence, on the 22 August, the Court advised both the Company and the
Prosecutor that a new (bankruptcy) hearing date has been set for 29 September
2017. In extending the date for the hearing, the Court Magistrates of the
Ivrea Court recognised both the results achieved by the Company so far and the
complexity of the various debt agreements, and accordingly, the Court allowed
more time to conclude negotiations with creditors.
During the same period, the valuation of the Company’s assets remained
unchanged.
Meanwhile, the Company has reported an operating loss of €362,000 after
excluding the exceptional gain of €2.4 million from the repurchase of
€3.14m of debt at a 76.15% discount, compared to a loss of €275,000 in the
period to 30 June 2016.
Principal Assets
An update on the Group’s principal assets at 30 June 2017 is as follows
(percentage of equity held):
Mediapolis srl (84.04%): owns a strategically located development site,
covering 497,884 sq m, in north-west Italy on the A4/A5 motorway between Milan
and Turin. Planning was approved in 2007 for a theme park, with additional
guest facilities, shops and offices but the necessary building permits have
not been forthcoming. In January 2015, Mediapolis launched a €39.65 million
claim against the regional government of Piedmont for failing to honour its
commitment to approve the construction of the park. Mediapolis continues to
pursue this claim and to seek approval of an acceptable development plan,
including an alternative plan for the construction of a Care Home complex.
Mediapolis also owns 10 holiday villas in the Porto Cervo area, the most
exclusive holiday location in Sardinia. During the first six months of 2017,
Mediapolis replaced its exposure towards three Italian banks, amounting to
€3.14 million, with a debt for the same amount to Clear Leisure 2017
Limited, a wholly owned subsidiary of the Company, set up in March 2017 to buy
back at discount the above Mediapolis bank debt.
SIPIEM SpA (50.17%): is a nominal shareholder in T.L.T. SpA which owns a
number of real estate assets including the operating Ondaland Waterpark,
located in north-west Italy. Between March 2010 and November 2012, Clear
Leisure expended, via Sipiem, € 7.1 million to secure a 60% holding in
T.L.T. Despite Clear Leisure making the payment, the Company did not receive
the interest in T.L.T.
At an EGM in July 2015, the majority shareholders of SIPIM voted to put the
company into voluntary liquidation. In July 2016, at a SIPIEM shareholders
meeting, the Company presented and voted for a resolution to recover damages
from former management and internal audit committee members. The Board remains
confident that its legal procedures will result in a positive outcome for
Clear Leisure.
GeoSim Systems Ltd (www.geosim.co.il) (4.53%): is an Israeli company seeking
to establish itself as the world leader in building complete and
photorealistic 3D “virtual” cities and in delivering them through the
Internet for use in local searches, real estate and city planning, homeland
security, tourism and entertainment. Autonomous car projects and other new
applications will inevitably require very detailed 3D models of cities and in
this regard, the release of GeoSim’s Vancouver 3D model represents an
important milestone for the company. GeoSim technology remains one of the best
options worldwide. Following recent developments in GeoSim technology,
including the use of Artificial Intelligence techniques to optimise time wise
and cost wise the development of 3D city models from raw data, the company
may become a core asset of Clear Leisure and will be sold at the right
opportunity.
ORH SpA (73.43%): owned a chain of hotels in Italy and East Africa under the
Ora Hotels brand. It was put into administration in February 2014, allegedly
due to gross financial misconduct by certain parties associated with the
company, prior to the sale to Clear Leisure. The Company continues to pursue a
claim against these parties, with the objective of recovering all the funds
historically invested, of nearly €6 million in cash and shares.
There are similar other claims and issues which Clear Leisure continues to
pursue, that may yield some return to the Group
Financial Review
The Company reported a profit before tax of €2.14 million after an
exceptional gain of €2.4 million on the repurchase of debt at a discount of
76.15% in the six months to 30 June 2017 (H1 June 2016: loss before tax
€620,000). Operating profits for the period were €2.032 million (H1 June
2016: operating loss €275,000).
The undiluted Net Asset Value (NAV) of the Company as of 30 June 2017 was
€4.95 million, compared to €1.6 million at 31 December 2016.
Operational review
On 24 January, the Company announced the issue and allotment of 3,658,536
ordinary shares of the Company to Francesco Gardin at 0.82 pence being that
part of his salary from January 2016 to December 2016 to be paid in equity.
During the first six months of 2017, the Company entered into four different
convertible loan agreements with Eufingest: €60,000 in January, €40,000 in
February, €60,000 in March and €1.2 million in April. In May, the Board
agreed with Eufingest to consolidate all the outstanding balances into one
single facility of €2.475 million (the “Consolidated Loan”).
The Consolidated Loan carries an interest rate of 1 per cent and is secured by
a first charge on certain Mediapolis land up to a value of €5 million.
Eufingest holds the right to convert part or the entire Consolidated Loan into
Ordinary Shares at the conversion price of 0.89 pence, whilst the Company can
pay back the balance and the interest without penalty any time before 28
April 2020.
Part of the proceeds of the loan agreements were used by the Company to buy
back €3.14 million of the Mediapolis debt at 76.15 per cent discount as
discussed above.
In mid May 2017, Mediapolis was served with a winding up order by the Court
Prosecutor of Ivrea. This petition arises from an initiative of the Ivrea
Court following a June 2016 winding up claim, which had been previously
settled by the Company. Nonetheless, under the Italian Law once the request
from the Court has been passed to the prosecutor, the winding up petition may
proceed in consideration of the other outstanding debts, notwithstanding that
the original debt has been settled.
While a first hearing had been scheduled for 23 June, Mediapolis managed to
submit to the Court additional debt settlement agreements reached by Clear
Leisure with several of the creditors. The Ivrea Court therefore agreed to
grant Mediapolis more time to submit additional agreements.
Post 30 June 2017 Events
On 17 July, the Company raised a total of £150,000 (gross of expenses)
through a placing of 13,043,478 ordinary shares of 0.25p ("Placing Shares") at
a price of 1.15 pence per share. Following the share placement Eufingest’s
holding decreased from 27.18 per cent, to 26.01 per cent.
On 25 July, Eufingest converted €74,830 of its €2,474,830 Convertible
Loan Note, at a conversion price of 0.89 pence per share. This resulted in the
issue of 7,546,155 new Ordinary Shares of 0.25 pence each and raised
Eufingest’s holding in the Company from 26.01 per cent to 27.81 per
cent. Following the conversion, the principal of the Consolidated Loan Note
due on 28 of April 2020 is now € 2.4 million and Clear Leisure’s enlarged
issued share capital comprises 310,291,286 Ordinary Shares.
On 17 August, the Company announced that the Company’s website will be
hosted under the following domain name: www.clearleisure.co.uk.
On 22 August, the Company announced that the Ivrea Court had agreed to allow
the submission of additional debt settlement agreements reached with
Mediapolis creditors, and as a consequence of the evidence produced, the Court
granted an extension to 29 September 2017 to allow Mediapolis to finalise
settlement agreements with the main creditors and present this evidence at the
new hearing.
Francesco Gardin
Clear Leisure PLC
CEO and Chairman
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 30 JUNE 2017
Note Six months to 30 June 2017 Unaudited Six months to 30 June 2016 Unaudited Year ended 31 December 2016 Audited
Continuing operations €’000 €’000 €’000
Revenue 21 - 63
Cost of sales - - -
21 - 63
Other operating income - - 943
Profit on settlement on interest bearing loan 2,394 - -
Administration expenses (383) (275) (1,162)
Operating profit/(loss) 2,032 (275) (156)
Other gains and losses - - 24
Finance income 296 - -
Finance charges (188) (345) (251)
Profit/(loss) before tax 2,140 (620) (383)
Taxation - - (14)
Profit/(Loss) for the Period 2,140 (620) (397)
Other comprehensive income
Gain on acquisition of non-controlling interest - - -
Exchange translation differences - - -
Total other comprehensive income - - -
TOTAL COMPREHENSIVE INCOME/(LOSS) FOR THE PERIOD 2,140 (620) (397)
Profit/(loss) attributable to:
Owners of the parent 2,105 (605) (450)
Non-controlling interests 35 (15) 53
Total comprehensive income/(loss) attributable to
Owners of the parent : 2,105 (605) (450)
Non-controlling interests 35 (15) 53
Earnings per share: 3
Basic and fully diluted profit/(loss) from continuing operations €0.007 (€0.003) (€0.002)
Basic and diluted profit/(loss) per share from discontinued operations - - -
Basic and diluted profit/(loss) per share €0.007 (€0.003) (€0.002)
STATEMENTS OF FINANCIAL POSITION
AT 30 JUNE 2017
Notes Six months to 30 June 2017 €’000 Six months to 30 June 2016 €’000 Year ended 31 December 2016 €’000
Non-current assets
Goodwill - - -
Other intangible assets 20 50 20
Property, plant and equipment 18,014 18,114 18,014
Available for sale investments 4 - - -
Other receivables 62 - 62
Total non-current assets 18,096 18,164 18,096
Current assets
Available for sale investments 4 634 614 634
Trade and other receivables 7,097 6,847 7,136
Cash and cash equivalents 5 1,394 1,393 1,370
Total current assets 9,125 8,854 9,140
Current liabilities
Trade and other payables (3,802) (4,588) (4,245)
Borrowings (16,757) (21,303) (19,880)
Total current liabilities (20,559) (25,891) (24,125)
Net current liabilities (11,434) (17,037) (14,985)
Total assets less current liabilities 6,662 1,127 3,111
Non-current liabilities
Borrowings (1,309) - (1,103)
Deferred liabilities and provisions (407) (407) (407)
Total non-current liabilities (1,716) (407) (1,510)
Net assets 4,946 720 1,601
Equity
Share capital 6,354 6,112 6,344
Share premium account 43,375 42,954 43,351
Other reserves 12,612 11,412 11,441
Retained losses (57,738) (59,998) (59,843)
Equity attributable to owners of the Company 4,603 480 1,293
Non-controlling interests 343 240 308
Total equity 4,946 720 1,601
AUDITED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2016
Group Share capital €’000 Share premium account €’000 Other reserves €’000 Retained losses €’000 Total €’000 Non-controlling interests €’000 Total equity €’000
At 1 January 2016 6,112 42,954 11,412 (59,393) 1,085 255 1,340
Total comprehensive income for the year - - - (450) (450) 53 (397)
Issue of shares 232 397 - - 629 - 629
Share option charge - - 29 - 29 - 29
At 31 December 2016 6,344 43,351 11,441 (59,843) 1,293 308 1,601
UNAUDITED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS TO 30 JUNE 2016
Group Share capital €’000 Share premium account €’000 Other reserves €’000 Retained losses €’000 Total €’000 Non-controlling interests €’000 Total equity €’000
At 1 January 2016 6,112 42,954 11,412 (59,393) 1,085 255 1,340
Loss for the period and total comprehensive income - - - (605) (605) (15) (620)
At 30 June 2016 6,112 42,954 11,412 (59,998) 480 240 720
UNAUDITED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS TO 30 JUNE 2017
Group Share capital €’000 Share premium account €’000 Other reserves €’000 Retained losses €’000 Total €’000 Non-controlling interests €’000 Total equity €’000
At 1 January 2017 6,344 43,351 11,441 (59,843) 1,293 308 1,601
Total comprehensive income for the period - - - 2,105 2,105 35 2,140
Issue of shares 10 24 - - 34 - 34
Equity portion on convertible loan - - 1,171 - 1,171 - 1,171
At 30 June 2017 6,354 43,375 12,612 (57,738) 4,603 343 4,946
STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2017
Six months to 30 June 2017 Unaudited €’000 Six months to 30 June 2016 Unaudited €’000 Year ended 31 December 2016 Audited €’000
Net cash outflow from operating activities (469) (578) (1,352)
Cash flows from investing activities
Disposal of investments - 60 63
Net cash inflow from investing activities - 60 63
Cash flows from financing activities
Proceeds from issues of new ordinary shares (net of expenses) 34 - 629
Proceeds from borrowings 1,360 409 383
Repayment of debt (901) (340) (195)
Net cash inflow from financing activities 493 69 817
Net increase/(decrease) in cash for the period 24 (449) (472)
Cash and cash equivalents at beginning of year 1,370 1,842 1,842
Cash and cash equivalents at end of period 1,394 1,393 1,370
NOTES TO THE FINANCIAL STATEMENTS
1.
General Information
Clear Leisure plc is a company incorporated and domiciled in England and
Wales. The Company’s ordinary shares are traded on the AIM of the London
Stock Exchange. The address of the registered office is 22 Great James Street,
London, WC1N 3ES
The principal activity of the Group is that of an investment company pursuing
a strategy to create a portfolio of companies
2. Accounting policies
The principal accounting policies are summarised below. They have all been
applied consistently throughout the period covered by these consolidated
financial statements.
Basis of preparation
The interim financial statements of Clear Leisure Plc are unaudited
consolidated financial statements for the six months ended 30 June 2017 which
have been prepared in accordance with IFRSs as adopted by the European
Union. They include unaudited comparatives for the six months ended 30 June
2016 together with audited comparatives for the year ended 31 December 2016.
The interim financial statements do not constitute statutory accounts within
the meaning of section 434 of the Companies Act 2006. The statutory accounts
for the year ended 31 December 2016 have been reported on by the company’s
auditors and have been filed with the Registrar of Companies. The report of
the auditors was (i) unqualified, (ii) contained an emphasis of matter
paragraph with regards Going Concern and (iii) did not contain any statement
under section 498 of the Companies Act 2006.
The interim consolidated financial statements for the six months ended 30 June
2017 have been prepared on the basis of accounting policies expected to be
adopted for the year ended 31 December 2017. These are anticipated to be
consistent with those set out in the Group’s latest financial statements for
the year ended 31 December 2016. These accounting policies are drawn up in
accordance with adopted International Accounting Standards (“IAS”) and
International Financial Reporting Standards (“IFRS”) as issued by the
International Accounting Standards Board and adopted by the EU.
The financial statements have been prepared under the historical cost
convention except for certain available for sale investments that are stated
at their fair values and land and buildings that have been revalued to their
fair value.
Going concern
The Directors, having made appropriate enquiries, consider that adequate
resources exist for the Company to continue in operational existence for the
foreseeable future and that, therefore, it is appropriate to adopt the going
concern basis in preparing the interim financial statements for the period
ended 30 June 2017.
Risks and uncertainties
The Board continuously assesses and monitors the key risks of the business.
The key risks that could affect the Company’s medium term performance and
the factors that mitigate those risks have not substantially changed from
those set out in the Company’s 2016 Annual Report and Financial Statements,
a copy of which is available on the Company’s website:
www.clearleisure.com. The key financial risks are liquidity and credit risk.
Critical accounting estimates
The preparation of interim financial statements requires management to make
estimates and assumptions that affect the reported amounts of assets and
liabilities at the end of the reporting period. Significant items subject to
such estimates are set out in note 2 of the Company’s 2016 Annual Report and
Financial Statements. The nature and amounts of such estimates have not
changed significantly during the interim period.
3. Earnings/(Loss) per share
The basic earnings per share is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average number of
ordinary shares outstanding during the period. Diluted earnings per share is
computed using the same weighted average number of shares during the period
adjusted for the dilutive effect of share warrants and convertible loans
outstanding during the period.
The profit and weighted average number of shares used in the calculation are
set out below:
Six months to 30 June 2017 Six months to 30 June 2016 Year ended 31 Dec 16
(Unaudited) (Unaudited) (Audited)
€’000 €’000 €’000
Profit/(loss) attributable to owners of the parent company:
Basic earnings 2,105 (605) (450)
Diluted earnings 2,291 (605) (450)
Basic weighted average number of ordinary shares (000’s) 289,234 210,409 238,824
Diluted weighted average number of ordinary shares (000’s) 327,118 210,409 238,824
Basic and fully diluted earnings per share:
Basic earnings per share €0.007 (€0.003) (€0.002)
Diluted earnings per share €0.007 (€0.003) (€0.002)
IAS 33 requires presentation of diluted earnings per share when a company
could be called upon to issue shares that would decrease earnings per share or
increase net loss per share. For a loss making company with outstanding share
options and warrants, net loss per share would only be increased by the
exercise of out-of-the money options and warrants, so no adjustment has been
made to diluted earnings per share for out-of-the money options and warrants
in the comparatives.
4. Available for sale investments
Group Six months to 30 June 2017 €’000 Six months to 30 June 2016 €’000 Year Ended 31 December 2016 €’000
Non-current assets
Fair value
At beginning of period - 60 60
Transfer to trade and other receivables - - -
Disposals - (60) (60)
Non-current assets - - -
Current assets 634 614 634
Total 634 614 634
5. Cash and cash equivalents
The amounts shown as cash and cash equivalents for the current and comparative
periods include €1,368,000 in a blocked account which can only be used when
construction commences at the Mediapolis development site.
6. Investment Policy
The Company intends on identifying and investing in investment opportunities
which it believes show excellent growth potential on a stand-alone basis and
which would add value to the Company's portfolio of investments through the
expertise of the Board or through the provision of ongoing funding.
It is the intention of the Company that the majority of investments will be
made in unlisted companies; however pre-IPO and listed companies may, from
time to time, be considered on a selective basis.
The Company believes that the collective experience of the Board together with
its extensive network of contacts will assist them in the identification,
evaluation and funding of investment targets. When necessary other external
professionals will be engaged to assist in the due diligence of prospective
targets. The Board will also consider, as it sees fit, appointing additional
directors and/or key employees with relevant experience as part of any
specific investment.
The Company may offer Shares as well as cash by way of consideration for
prospective investments, thereby helping to preserve the Company's cash for
working capital. The Company may, in appropriate circumstances, issue debt
securities or borrow money to complete an investment.
7. Copies of Interim Accounts
Copies of the interim results are available at the Group´s web site at
www.clearleisure.co.uk. Copies may also be obtained from the Group´s
registered office: Clear Leisure PLC, 22 Great James Street London WC1N 3ES.
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