REG - Thalassa Holdings - Preliminary Results for the year ended 31 Dec 2019
This announcement contains inside information as defined in Article 7 of the Market Abuse Regulation 596/2014 and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.
Thalassa Holdings Ltd
(Reuters: THAL.L, Bloomberg: THAL:LN)
("Thalassa", "THAL" or the "Company")
Preliminary Results for the year ended 31 December 2019
HIGHLIGHTS
Group Results 2019 versus 2018
US$
•• Group (Loss) / Profit after tax for the year
$(3.0)m vs. $7.0m
Continuing Operations
•• Operating Loss before exceptional costs & depreciation
$(3.4)m vs. $(4.5)m
•• Operating Loss before depreciation (EBITDA)
$(4.3)m vs. $(4.5)m
•• Group Loss from continuing operations
$(3.5)m vs. $(6.4)m
Discontinued Operations
•• Group Profit from discontinued operations
$0.5m vs. $13.4m
•• Group Earnings Per Share (basic and diluted)*1
$(0.18)/£(0.14) vs. $0.37/£0.28
•• Book value per share*2
$1.69/£1.28 vs. $1.71/£1.34
••
Cash
$24.2m vs. $17.4m
••
Debt
$ 8.0m vs. $ nil
*1 based on weighted average number of shares in issue of 17,143,300 (2018: 18,919,049) and £1 = $1.28 (2018: £1 = $1.33)
*2 based on actual number of shares in issue as at 31 December 2019 of 16,242,283 (2018: 17,852,275) and £1 = $1.32
(2018: £1 = $1.27)
2019 HIGHLIGHTS
•• WGP
September 2019, received second earn-out payment of $4.8m related to disposal of WGP.
Prospect of a further $4m earn-out payment associated with award of second specific contract to WGP.
Expected award and payment 2021/2022 not yet included in receivables.
•• LSR
Thalassa's investment in The Local Shopping REIT plc ("LSR") increased to 92.62% as a result of LSR's Tender Offer which completed on 4 October 2019.
•• ARL
Completed Proof of Concept of Flying Node
Attendance at EAGE in June 2019
Presented at the Defence & Security Equipment International show ("DSEI") in September 2019 on the Royal Navy stand as part of their NavyX initiative
Late-stage contract negotiations underway with potential strategic partners for both Commercial and Defence development programs
•• id4
Completed acquisition in Dec 2019 of id4 AG, a Swiss fintech company specialising in Client Life Cycle Management systems.
Investor Enquiries:
Thalassa Holdings Ltd
Duncan Soukup, Chairman +33 (0)6 78 63 26 89
WH Ireland Limited (Financial Adviser)
Chris Fielding, Managing Director, Corporate Finance +44 (0)207 220 1650
Note to Editors:
Thalassa Holdings Ltd, incorporated and registered in the BVI, is a holding company with various interests across a number of industries.
ECONOMIC BACKGROUND
S&P 500 1929 vs 2020
http://www.rns-pdf.londonstockexchange.com/rns/1410R_1-2020-6-25.pdf
Recommended reading for those who believe history doesn't repeat itself…
http://www.rns-pdf.londonstockexchange.com/rns/1410R_1-2020-6-25.pdf
Throughout history, rich and poor countries alike have been lending, borrowing, crashing-and recovering-their way through an extraordinary range of financial crises. Each time, the experts have chimed, "this time is different"-claiming that the old rules of valuation no longer apply and that the new situation bears little similarity to past disasters. With this breakthrough study, leading economists Carmen Reinhart and Kenneth Rogoff definitively prove them wrong. Covering sixty-six countries across five continents, This Time Is Different presents a comprehensive look at the varieties of financial crises, and guides us through eight astonishing centuries of government defaults, banking panics, and inflationary spikes-from medieval currency debasements to today's subprime catastrophe. Carmen Reinhart and Kenneth Rogoff, leading economists whose work has been influential in the policy debate concerning the current financial crisis, provocatively argue that financial combustions are universal rites of passage for emerging and established market nations. The authors draw important lessons from history to show us how much-or how little-we have learned.
Using clear, sharp analysis and comprehensive data, Reinhart and Rogoff document that financial fallouts occur in clusters and strike with surprisingly consistent frequency, duration, and ferocity. They examine the patterns of currency crashes, high and hyperinflation, and government defaults on international and domestic debts-as well as the cycles in housing and equity prices, capital flows, unemployment, and government revenues around these crises. While countries do weather their financial storms, Reinhart and Rogoff prove that short memories make it all too easy for crises to recur.
An important book that will affect policy discussions for a long time to come, This Time Is Different exposes centuries of financial missteps.
CHAIRMAN'S STATEMENT
Given the impact of Coronavirus on Global Commerce, a discussion of 2019 results appears more than somewhat irrelevant. Nonetheless, I am obliged to comment on past events and, somehow, peer into a crystal ball or divine some tarot cards and advise shareholders as to the Company's future. Given that I have neither a crystal ball nor a pack of tarot cards, this exercise should be interesting, if not equally irrelevant.
2019, was from Thalassa's point of view a period of immense hard work with very little reportable news. Having said that it was also a year of substantial progress on all fronts:
Autonomous Robotics Ltd (ARL) completed Proof of Concept of its Flying Node and has commenced negotiations with a number of major corporations with regard to commercial and defence collaborations.
Apeiron completed the acquisition of id4, which, as announced in February 2020, won a Swiss FinTech award for its software and has commenced sales whilst it completes the final phase of software development.
Anemoi due to a combination of market and Covid-19 related circumstances the listing process is progressing more slowly than anticipated. Since the year end we have set up Anemoi International, a BVI registered company, and will update further as the situation evolves.
WGP, as previously reported, Thalassa received the second payment of the initial performance related earn-out in the amount of $4.8m. The total amount of the initial earn out in the amount of $6m has now been received. The Company stands to earn a further $4 million if a second specific contract is awarded before 1 January 2023. We anticipated that this contract could be awarded in 2021.
Local Shopping REIT Plc (LSR), as reported, the LSR board are currently working on a plan to transfer the Company to the Standard List and change the Company's investment objectives from a Real Estate Investment Trust to an operating company focused on Travel and Leisure, subject to necessary approvals. Further details will be announced in due course.
Miscellaneous Holdings Thalassa went into the market collapse well positioned and benefited substantially from the ~30% fall in Global stock prices. Unfortunately, we have given some of these gains back along with the rapid recovery in US stock prices, notwithstanding the huge rise in global unemployment and, in our opinion, inevitable collapse in demand which is likely to last far longer than the current recovery appears to reflect.
Gitone After the year end we announced in January 2020 that Thalassa had entered into a loan contract with Gitone Beteiligungsverwaltungs GmbH (Gitone) to lend e11 million through two tranches of e5.5m. Gitone is a company established in Croatia for the purpose of purchasing shares in Liburnia Riviera Hoteli d.d. and other hospitality investments. The first tranche of EUR5.5m was paid in January 2020, and as announced 20 May 2020 the terms of the contract were renegotiated and the loan reduced to EUR5.5m.
Share buy-back The Company's share buy-back programme has been suspended in order to conserve cash during the current economic turmoil; at the time of writing the Company has repurchased a total of ca.9.325 million shares at an average price of 69.97 pence per share for an aggregate amount of ca. £6.5 million. Under the current buy-back authority of 5 March 2019 the Company has £5.05 million of facility left.
Covid-19 In the Board's opinion, a smooth Global economic recovery from the impact of Covid-19 is unlikely. The Directors have considered a number of potential downside scenarios and taken steps to minimise any impact on the Group. Actions have been taken across all Group companies to reduce our outgoings where possible.
The Group has fully assessed its financial commitments and as at the time of writing has net cash of $10.5m plus a further $5.5m of available for sale investments. We are confident that the Company can mitigate any potential impact from Covid-19 and can deploy its capital profitably.
I would like to thank the Company's staff who continue to work tirelessly in these difficult times.
Duncan Soukup
Chairman
26 June 2020
CONSOLIDATED STATEMENT OF INCOME
for the year ended 31 December 2019
2019
2018
$
$
Continuing Operations
Revenue
170,357
3,188
Cost of sales
(276,001)
(109,027)
Gross profit / (loss)
(105,644)
(105,839)
Administrative expenses excluding exceptional costs
(3,332,632)
(4,428,743)
Exceptional administration costs
(898,878)
-
Total administrative expenses
(4,231,510)
(4,428,743)
Operating loss before depreciation
(4,337,154)
(4,534,582)
Depreciation
(26,308)
(41,919)
Impairment
(157,185)
-
Operating loss
(4,520,647)
(4,576,501)
Net financial income/(expense)
(640,117)
470,050
Share of losses of associated entities
(629,523)
(2,353,182)
Profits on disposal of associated entities
2,000,978
-
Loss before taxation
(3,789,309)
(6,459,633)
Taxation
253,065
68,015
Loss for the year from continuing operations
(3,536,244)
(6,391,618)
Discontinued Operations
Profit for the year from discontinued operations
478,046
-
Gain on disposal of WGP assets
-
13,419,475
(Loss) / Profit for the year
(3,058,198)
7,027,857
Attributable to:
Equity shareholders of the parent
(3,028,479)
7,027,857
Non-controlling interest
(29,719)
-
(3,058,198)
7,027,857
Earnings per share - US$ (using weighted average number of shares)
Basic and Diluted - Continuing Operations
(0.20)
(0.34)
Basic and Diluted - Discontinued Operations
0.03
0.71
Basic and Diluted
(0.18)
0.37
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 December 2019
2019
2018
$
$
Profit for the financial year
(3,058,198)
7,027,857
Other comprehensive income:
Exchange differences on re-translating foreign operations
578,281
109,344
Total comprehensive income
(2,479,917)
7,137,201
Attributable to:
Equity shareholders of the parent
(2,450,198)
7,137,201
Non-Controlling interest
(29,719)
-
Total Comprehensive income
(2,479,917)
7,137,201
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
as at 31 December 2019
2019
2018
Assets
$
$
Non-current assets
Goodwill
204,724
-
Intangible assets
173,466
-
Investment properties
4,138,318
-
Property, plant and equipment
75,455
16,803
Available for sale financial assets
4,801,450
787,518
Loans
1,695,302
1,645,260
Investments in associated entities
-
6,727,670
Total non-current assets
11,088,715
9,177,251
Assets Held for Sale
435,383
-
Current assets
Trade and other receivables
1,432,031
6,095,202
Cash and cash equivalents
24,198,744
17,370,372
Total current assets
25,630,775
23,465,574
Liabilities
Current liabilities
Trade and other payables
1,685,491
2,156,692
Borrowings
7,557,243
-
Total current liabilities
9,242,734
2,156,692
Net current assets
16,388,041
21,308,882
Non-current liabilities
Lease liabilities
510,965
-
Total non-current liabilities
510,965
-
Net assets
27,401,174
30,486,133
Shareholders' Equity
Share capital
255,675
255,675
Share premium
45,416,298
45,416,298
Treasury shares
(8,690,465)
(7,337,959)
Other reserves
439,199
(139,082)
Non-Controlling Interest
628,673
-
Retained earnings
(10,648,206)
(7,708,799)
Total shareholders' equity
27,401,174
30,486,133
Total equity
27,401,174
30,486,133
CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended 31 December 2019
2019
2018
$
$
Cash flows from operating activities
Profit/(Loss) for the year before taxation
(3,789,309)
6,959,842
Impairment losses on goodwill
157,185
-
(Increase)/decrease in trade and other receivables
5,956,290
(185,787)
(Decrease)/increase in trade and other payables
(896,649)
(3,359,710)
Loss/(gain) on disposal of PPE
2,686
(13,419,475)
Gain/(loss) on disposal of AFS investments
(23,484)
(207,509)
Net exchange differences
(287,533)
(32,875)
Accrued interest income
(50,042)
(48,565)
Depreciation
26,308
41,919
Share of losses of associate/gain on disposal
(1,371,455)
2,338,218
Fair value movement on AFS financial assets
224,307
(25,516)
Cash generated by operations
(51,696)
(7,939,458)
Taxation
132,663
68,015
Net cash flow from operating activities
80,967
(7,871,443)
Net cash flow from discontinued operations
-
-
Sale/(purchase) of property, plant and equipment
(15,181)
(3,638)
Sale/(purchase) of intangible assets
(173,466)
-
Sale/(purchase) of investment property
293,521
-
Net (purchase)/sale of AFS financial assets
(4,214,755)
186,197
Net cash acquired on acquisition of subsidiaries
4,450,049
-
Net cash flow in investing activities - continuing operations
340,168
182,559
Proceeds from the disposal of WGP assets
-
19,106,548
Payment/proceeds from the Norwegian tax settlement of WGP group
(346,296)
-
Net cash flow from / (used) in investing activities - discontinued operations
(346,296)
19,106,548
Cash flows from financing activities
Purchase of treasury shares
(1,352,506)
(2,280,798)
Proceeds from borrowings
23,649,036
-
Repayment of borrowings
(16,128,792)
-
Net cash flow from financing activities - continuing operations
6,167,738
(2,280,798)
Net increase in cash and cash equivalents
6,242,577
9,136,866
Cash and cash equivalents at the start of the year
17,370,372
8,091,288
Effects of exchange rate changes on cash and cash equivalents
585,795
142,218
Cash and cash equivalents at the end of the year
24,198,744
17,370,372
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31 December 2019
Attributable to owners of the Company
Non-
Total
Share
Share
Treasury
Other
Retained
controlling
Shareholders
Capital
Premium
Shares
Reserves
Earnings
Total
Interest
Equity
$
$
$
$
$
$
$
$
Balance as at
31 December 2017
255,675
45,416,298
(5,057,161)
(248,426)
(14,736,656)
25,629,730
-
25,629,730
Purchase of treasury shares
-
-
(2,280,798)
-
-
(2,280,798)
-
(2,280,798)
Total comprehensive
income for the period
-
-
-
109,344
7,027,857
7,137,201
-
7,137,201
Balance as at
31 December 2018
255,675
45,416,298
(7,337,959)
(139,082)
(7,708,799)
30,486,133
-
30,486,133
Purchase of treasury shares
-
-
(1,352,506)
-
-
(1,352,506)
-
(1,352,506)
Acquisition of
subsidiary with NCI
-
-
-
-
89,072
89,072
658,392
747,464
Total comprehensive
income for the period
-
-
-
578,281
(3,028,479)
(2,450,198)
(29,719)
(2,479,917)
Balance as at
31 December 2019
255,675
45,416,298
(8,690,465)
439,199
(10,648,206)
26,772,501
628,673
27,401,174
ACCOUNTING POLICIES
The Group prepares its accounts in accordance with applicable International Financial Reporting Standards ("IFRS") as adopted by the European Union.
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.ENDFR ZZGZVVKKGGZM
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