TIDMBSP
RNS Number : 2005O
Black Sea Property PLC
29 September 2023
Friday 29 September, 2023
Black Sea Property
Half-year Report
RNS Number :2005O
Black Sea Property PLC
29 September 2023
BLACK SEA PROPERTY PLC
("Black Sea Property" or the "Company")
Half-yearly report for the period ended 30 June 2023
The Board of Black Sea Property PLC is pleased to announce its
interim report for the six-month period ended 30 June 2023.
Electronic copies of the interim report will be available at the
Company's website http://www.blackseapropertyplc.com
BLACK SEA PROPERTY PLC simon.hudd@d3ainvestments.com
Simon Hudd, Chairman
PETERHOUSE CAPITAL LIMITED
Aquis Corporate Adviser
Heena Karani and Duncan Vasey +44 (0) 20 7469 0930
Market Abuse Regulation (MAR) Disclosure
This announcement contains inside information for the purposes
of Article 7 of the Market Abuse Regulation EU 596/2014 as it forms
part of retained EU law (as defined in the European Union
(Withdrawal) Act 2018).
Black Sea Property PLC
HALF-YEARLY REPORT
FOR THE SIX MONTH PERIODED
30 JUNE 2023
Contents
Chairman's Statement
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated Statement of Cash Flows
Notes to the Consolidated Financial Statements
Chairman's Statement
As at 30 June 2023 the significant shareholders of Black Sea
Property Plc ("the Company") were as follows:
Beneficial shareholder Holding Percentage
Neo London Capital
Plc 515,126,806 28.41%
Compass Capital JSC 304,354,182 16.78%
Mamferay Holdings
Limited 449,957,562 24.81%
Capman AM 92,000,000 5.07%
Interfund Investments
Plc 89,500,000 4.94%
The shareholder structure as at 31 December 2022 is the
following:
Beneficial shareholder Holding Percentage
Neo London Capital
Plc 515,126,806 28.41%
Compass Capital JSC 304,354,182 16.78%
Mamferay Holdings
Limited 449,957,562 24.81%
Capman AM 92,000,000 5.07%
Interfund Investments
Plc 89,500,000 4.94%
Chairman's statement
I am pleased to present the unaudited interim financial
statements of the Company for the six months ended 30 June
2023.
The unaudited net asset value as at 30 June 2023 was EUR28.7
million or 1.58 cents per share (31 December 2022: EUR28.8 million
or 1.59 cents per share).
During the period, the Company generated revenues of EUR264,835
(June 2022: EUR152,646) which resulted in a loss before taxation of
EUR74,412 (June 2022: EUR553,150). The results reflected other
income of EUR678,836 (June 2022: EUR106,798), property operating
expenses of EUR283,729 (June 2022: EUR132,856), other operating
expenses of EUR328,293 (June 2022: EUR458,473) and interest payable
and other charges of EUR406,061 (June 2022: EUR215,287). Loss per
share amounted to EUR0.01 cents (June 2022: EUR0.03 cents).
Camping South Beach EOOD ("CSB")
The summer season in 2023 marked a positive development, despite
the challenging environment arising from the military conflict in
Ukraine. Camping South Beach preserved its prime position as a
destination for luxury camping holidays and beach houses. Following
the trend from the previous seasons most of the guests were
Bulgarian citizens, as well as tourists from the EU.
Camping South Beach achieved occupancy levels of around 58% in
July and 51% in August 2023. On yearly basis the occupancy increase
is approx. 5 %, compared to 2022.
Despite the slight increase in occupancy, they still remain
below the targeted levels, based on the overall economic
uncertainty arising from the war in Ukraine.
In 2023, the third active season under the Concession Agreement
("Agreement") for the beach in front of CSB, has provided
additional value to the property and has enabled synergy with the
campsite. The term of the Concession Agreement is 20 years, and all
requirements and obligations specified in the Agreement have been
fulfilled.
The long-term strategy of CSB is to develop the whole Gradina
area including the newly acquired adjacent real estate and Black
Sea Star hotel into an exclusive summer resort meeting the highest
standards.
Ivan Vazov 1 Building
During the period, the reconstruction works for the historic
Ivan Vazov building were ongoing. The renovation of the roof has
been completed and all construction works were executed to a high
standard in line with the approved designs.
Chairman's Statement (continued)
The building consists of a basement floor, five floors and an
attic floor with total buil t -up area of 9 , 107 m2. The attic
floor will be converted into a mansard floor following the
reconstruction of the roof.
As the building is recogni z ed as a historical monument by the
National Institute of Cultural Monuments in Bulgaria, both the
exterior and interior of the building will undergo renovation. This
includes elements such as the columns, profiled cornices, figures
of Atlanteans, the mask of the Goddess on the façade, and the
ornamental ironwork of the entrance doors. The Company is carrying
out all of the works in accordance with applicable regulations. The
construction of the beautiful copper covered roof has been
finalized and thus the building will be preserved according to the
highest standards. We hope to receive permission from the local
authorities for using the top floor and reconstructing the roof in
November 2023 .
Byala Plots of Land ("Byala")
The public procedure for the Urban Master Plan of Byala
municipality region by the authorities has commenced, but the
approval process is not yet finished.
The Company is planning the development of plots of land at
Byala as a camping site with luxury bungalows, which is anticipated
to be complementary to existing investments at CSB. The project
will add value to the portfolio of the Company, reflecting the high
demand of close-to-nature camp sites offering a safe and secure
environment for visitors.
Received final payment for the sale of ECDC Group
During the period Black Sea Property has received the final
payment for the sale of the remaining assets of ECDC Group which
the Company sold on 30 September 2021, for a cash consideration of
EUR4.5 million.
Events after reporting date
Signed agreement for acquisition of Grand Hotel Varna AD
Black Sea Property PLC has signed an agreement to acquire 98.27%
of Grand Hotel Varna AD (the "Acquisition").
Grand Hotel Varna AD wholly owns GHV-Dolphins EAD, a Bulgarian
company which holds the title to real estate comprising three
hotels and a beach marina resort (together, the "Resort"), situated
in a prime location on the Black Sea Coast, with excellent
accessibility.
The primary purpose of the Acquisition is to strengthen Black
Sea Property's hospitality investments, by adding desirable hotels
to its existing investment in Camping South Beach.
The consideration payable for the Acquisition is EUR 28 million
in cash, of which an initial non-refundable deposit of EUR 1.6
million was paid upon signing of the agreement. The property assets
being acquired have been independently valued at EUR 19 million,
and the mutual fund portfolio is currently valued at EUR 12
million.
BSP has raised EUR12million through the issue of unsecured loan
notes to certain existing shareholders. The proceeds of the issue
of the Loan Notes have been used to pay tranches of the
consideration for the Acquisition.
To satisfy the balance of the consideration, the Company will
need to raise additional funds. Subject to securing the required
funding, which the Directors are confident of achieving, the
Acquisition is expected to be completed by 30 October 2023.
The Directors of the Company are responsible for the contents of
this announcement.
Simon Hudd
Chairman
29.09.2023
Consolidated Statement of Comprehensive Income
for the period ended 30 June 2023
(Unaudited) (Unaudited) (Audited)
6 months 6 months Year ended
to to
30 June 30 June 31 December
2023 2022 2022
Note EUR EUR EUR
Total revenue
Revenue 264,835 152,646 1,159,445
Property operating expenses (283,729) (132,856) (1,409,106)
------------ ------------- ------------
Net rental income/(expense) (18,894) 19,790 (249,661)
------------ ------------- ------------
(Loss)/gain on revaluation of
investment properties - (3,430) 724,708
Net (loss)/gain on investment
property - (3,430) 724,708
------------ ------------- ------------
Administration and other expenses 5 (328,293) (458,473) (800,340)
Total operating profit/(loss) (347,187) (442,113) (325,293)
------------ ------------- ------------
Other income 6 678,836 106,798 3,449,267
Bargain purchase 11 - 2,127,765
(Losses)/Profit from investments
accounted for using the equity
method - (2,548) (2,548)
Interest payable and similar
charges (406,061) (215,287) (862,551)
(Loss)/profit before tax (74,412) (553,150) 4,386,640
Tax expense 8 - (62,266) (537,399)
(Loss)/profit and total comprehensive
income for the period (74,412) (615,416) 3,849,241
============ ============= ============
(Loss)/Profit and total comprehensive
income attributable to the:
- shareholders of the parent
company (74,412) (615,416) 3,849,241
- non-controlling interest - - -
(Loss)/earnings per share
Basic & Diluted(loss)/earnings
per share (cents) 7 (0.01) (0,03) 0,22
The notes form an integral part of these financial
statements.
The financial statements were approved and authorised for issue
by the Board of Directors on 28.09.2023
and were signed on their behalf by:
Chairman Director
Simon Hudd Ventsislava Altanova
Consolidated Statement of Financial Position at 30 June 2023
(Unaudited) (Audited)
30 June 31 December
2023 2022
Note EUR EUR
Non-current assets
Investment properties 9 47,517,500 47,517,500
Intangible assets 10 433,126 450,390
Property, plant and equipment 1,224,043 517,952
Long term Deposit 102,258 -
Total non-current assets 49,277,927 48,485,842
-------------- --------------
Current assets
Trade and other receivables 12 3,685,698 6,331,172
Cash and cash equivalents 384,599 239,409
Total current assets 4,070,297 6,570,581
-------------- --------------
Total assets 53,348,224 55,056,423
============== ==============
Equity and liabilities
Issued share capital 13 70,699,442 70,699,442
Retained deficit (40,461,277) (40,386,865)
Foreign exchange reserve (1,553,086) (1,533,086)
-------------- --------------
Total equity 28,705,079 28,779,491
-------------- --------------
Non-current liabilities
Bank loans 14 18,161,392 18,185,200
Trade and other payables 15 528,775 539,929
Deferred tax liability 8 2,407,965 2,407,965
-------------- --------------
Total non-current liabilities 21,098,132 21,133,094
-------------- --------------
Current liabilities
Trade and other payables 15 1,082,172 726,326
Tax liability 15 153,796 80,425
Bank loans 14 2,084,062 1,771,278
Related party payables 16 115,199 -
Shareholder loan 16 109,784 2,565,808
Total current liabilities 3,545,013 5,143,838
-------------- --------------
Total liabilities 24,643,145 26,276,932
-------------- --------------
Total equity and liabilities 53,348,224 55,056,423
============== ==============
Number of ordinary shares in issue 1,813,323,603 1,813,323,603
NAV per ordinary share (cents) 17 1.58 1.59
The notes form an integral part of these financial
statements.
The financial statements were approved and authorised for issue
by the Board of Directors on 28.09.2023
and were signed on their behalf by:
Chairman Director
Simon Hudd Ventsislava Altanova
Consolidated Statement of Changes in Equity for the period ended
30 June 2023
Share capital Retained Foreign Total equity Non-controlling Total
earnings currency attributable interests
translation to the parent
reserve company
EUR EUR EUR EUR EUR EUR
At 1 January 2022 70,699,442 (44,236,106) (1,533,086) 24,930,250 - 24,930,250
Loss for the period - (615,416) - (615,416) - (615,416)
-------------- ------------- ------------- --------------- ---------------- -----------
Total comprehensive
income - (615,416) - (615,416) - (615,416)
-------------- ------------- ------------- --------------- ---------------- -----------
At 30 June 2022
(unaudited) 70,699,442 (44,851,522) (1,533,086) 24,314,834 - 24,314,834
-------------- ------------- ------------- --------------- ---------------- -----------
At 1 January 2022 70,699,442 (44,236,106) (1,533,086) 24,930,250 - 24,930,250
Transactions with - - - - - -
owners
Profit for the year - 3,849,241 - 3,849,241 - 3,849,241
Total comprehensive
income - 3,849,241 - 3,849,241 - 3,849,241
-------------- ------------- ------------- --------------- ---------------- -----------
At 31 December 2022
(audited) 70,699,442 (40,386,865) (1,533,086) 28,779,491 - 28,779,491
============== ============= ============= =============== ================ ===========
At 1 January 2023 70,699,442 (40,386,865) (1,533,086) 28,779,491 - 28,779,491
Loss for the period - (74,412) - (74,412) - (74,412)
Total comprehensive
income - (74,412) - (74,412) - (74,412)
-------------- ------------- ------------- --------------- ---------------- -----------
At 30 June 2023
(unaudited) 70,699,442 (40,461,277) (1,533,086) 28,705,079 - 28,705,079
============== ============= ============= =============== ================ ===========
The notes form an integral part of these financial
statements.
The financial statements were approved and authorised for issue
by the Board of Directors on 28.09.2023
and were signed on their behalf by:
Chairman Director
Simon Hudd Ventsislava Altanova
Consolidated Statement of Cash Flows
for the period ended 30 June 2023
(Unaudited) (Unaudited) (Audited)
6 months 6 months Year ended
to to
30 June 30 June 31 December
2023 2022 2022
EUR EUR EUR
Operating activities
(Loss)/profit before tax (74,412) (553,150) 4,386,640
Loss/(gain) on revaluation of
investment properties - 3,430 (724,708)
Bargain Purchase on Acquisition - - (2,127,765)
Materials from disposal of subsidiaries - - 232,737
Loss from investments accounted - 2,548 -
for using the equity method
Impairment of intangible fixed - (142,499) -
assets
Amortization of intangible fixed
assets 17,264 49,191 62,987
Depreciation of property, plant
and equipment 1,859 1,586 3,444
Interest received (662,944) (94,882) (898,689)
Bad debt recovered - - (2,550,578)
Interest paid 298,399 215,288 862,551
Changes in the working capital (419,834) (518,488) (753,381)
Decrease/(increase) in receivables 2,729,479 (254,811) (1,451,996)
(Decrease)/increase in payables 459,891 715,094 431,565
------------
Cash used in operation 2,769,536 (58,205) (1,773,812)
Tax refund/(paid) 73,370 - 6,190
------------ ------------ ------------
Net cash outflow from operating
activities 2,842,906 (58,205) (1,767,622)
Investing activities
Investment property additions
and acquisitions - (1,526,600) (1,470,562)
Property, plant and equipment (708,950) - (496,513)
Star Mill acquisition - - (5,150,001)
Bad debt recovered - - 2,550,578
Loans granted (84,005) (29,235) -
Loan repayments - 38,244 -
Interest received 662,944 84,466 898,689
Long term deposit (102,258) - -
Cash held by the (disposed)/acquired
subsidiary - - 151
Net cash (outflow)/ from investing
activities (232,269) (1,433,125) (3,667,658)
Financing activities
Loans issued/(repaid) (2,167,048) 2,939,083 6,211,052
Interests paid and other charges (298,399) (215,943) (862,551)
Other flows from financing activities - (49,305) -
Net cash inflow/(outflow) from
financing activities (2,465,447) 2,673,835 (5,348,501)
Net increase/(decrease) in cash
and cash equivalents 145,190 1,182,505 (86,779)
Cash and cash equivalents at
beginning of period 239,409 326,188 326,188
Cash and cash equivalents at
end of period 384,599 1,508,693 239,409
============ ============ ============
The notes form an integral part of these financial
statements.
The financial statements were approved and authorised for issue
by the Board of Directors on 28.09.2023
and were signed on their behalf by:
Chairman Director
Simon Hudd Ventsislava Altanova
Notes to the Financial Statements for the period ended 30 June
2023
1. General information
Black Sea Property Plc (the Company) is a company incorporated
and domiciled in the Isle of Man whose shares are publicly traded
on the Aquis Stock Exchange in London.
2. Statement of compliance
These interim consolidated financial statements have been
prepared in accordance with IAS 34 Interim Financial Reporting.
They do not include all of the information required for full annual
financial statements, and should be read in conjunction with the
consolidated financial statements of the Group as at and for the
year-ended 31 December 2022.
The consolidated financial statements of the Group as at and for
the year ended 31 December 2022 are available upon request from the
Company's registered office at 6th Floor, Victory House, Prospect
Hill, Douglas, Isle of Man or at www.blackseapropertyplc.com .
These interim consolidated financial statements were approved by
the Board of Directors on 28 September 2023 .
3. Significant accounting policies
The accounting policies applied in these interim financial
statements, except for the ones listed below, are the same as those
applied in the Group's consolidated financial statements as at and
for the year ended 31 December 2022.
4. Financial risk management policies
The principal risks and uncertainties are consistent with those
disclosed in preparation of the Group's annual financial statements
for the year ended 31 December 2022.
5. Administration and other expenses
(Unaudited) (Unaudited) (Audited)
6 months 6 months Year ended
to to
30 June 30 June 31 December
2023 2022 2022
EUR EUR EUR
Directors' remuneration 27,824 27,818 54,208
Administration fees - Isle of Man - - 64,579
Administration fees - Bulgaria 37,322 - 28,279
Legal and professional fees 108,012 309,746 301,063
Auditors' remuneration - - 53,477
Foreign currency expenses 2,051 - 3,262
Other administration and sundry expenses 54,876 13,551 229,041
Investment advisory fees 98,208 107,358 66,431
328,293 458,473 800,340
------------ ------------ ------------
Notes to the Financial Statements for the period ended 30 June
2023 (continued)
6. Other income
(Unaudited) (Unaudited) (Audited)
6 months 6 months Year ended
to to
30 June 30 June 31 December
2023 2022 2022
EUR EUR EUR
Interest income - receivable balances 662,944 94,882 303,952
Bad debts recovered - - 2,550,578
Others 15,892 11,916 594,737
678,836 106,798 3,449,267
------------ ------------ ------------
7. (Loss)/earnings per share
The basic (loss)/earnings per ordinary share is calculated by
dividing the net (loss)/profit attributable to the ordinary
shareholders of the Company by the weighted average number of
ordinary shares in issue during the period.
(Unaudited) (Unaudited) (Audited)
6 months 6 months Year ended
to to
30 June 30 June 31 December
2023 2022 2022
EUR EUR EUR
(Loss)/earnings attributable to owners
of parent EUR (74,412) (615,416) 3,849,241
Weighted average number of ordinary
shares in issue 1,813,323,603 1,813,323,603 1,783,601,434
Basic (loss)/earnings per share
(cents) (0.01) (0.03) 0.22
-------------- -------------- --------------
The Company has no potential dilutive ordinary shares; the
diluted (loss)/earnings per share is the same as the basic
(loss)/earnings per share.
Notes to the Financial Statements for the period ended 30 June
2023 (continued)
8. Taxation
Isle of Man
There is no taxation payable on the Company's or its Jersey
subsidiaries' results as they are based in the Isle of Man and in
Jersey respectively where the Corporate Income Tax rates for
resident companies are 0% (2022: 0%). Additionally, neither the
Isle of Man nor Jersey levies tax on capital gains.
Consequently, shareholder's resident outside of the Isle of Man
and Jersey will not incur any withholding tax in those
jurisdictions on any distributions made to them.
Bulgaria
Subsidiaries of the Company incorporated in Bulgaria are taxed
in accordance with the applicable tax laws of Bulgaria. The
Bulgarian corporate tax rate for the year was 10% (2022: 10%).
No deferred tax assets are recognised on trading losses in the
subsidiary companies as there is significant uncertainty as to
whether sufficient future profits will be available in order to
utilise these losses.
A reconciliation of the tax charge for the year to the standard
rate of corporation tax for the Isle of Man of 0% (2022: 0%) is
shown below.
(Unaudited) (Audited)
30 June 31 December
2022
2023 EUR
EUR
--------------------------------------------- ------------- -------------
(Loss)/Profit before tax (74,412) 3,849,241
--------------------------------------------- ------------- -------------
Profit on ordinary activities multiplied - -
by the standard rate in the Isle of Man
of 0% (2021: 0%)
Effect of different tax rates in different
countries - 74,236
Deferred tax liability movement - 463,163
--------------------------------------------- ------------- -------------
Current charge for the year - 537,399
--------------------------------------------- ------------- -------------
Bulgarian tax losses brought-forward at
10% (183,943) (183,943)
Tax losses utilised in the year - -
--------------------------------------------- ------------- -------------
Bulgarian tax losses carried-forward at
10% (183,943) (183,943)
--------------------------------------------- ------------- -------------
Deferred tax liability
Opening deferred tax liability balance 2,407,965 1,944,802
Deferred tax liability on fair value uplift - -
of investment property on
Acquisition/(disposal) of a subsidiary
Bulgarian deferred tax liability charge - -
Deferred tax liability on fair value uplift
of investment property - 463,163
Closing deferred tax liability balance 2,407,965 2,407,965
--------------------------------------------- ------------- -------------
Notes to the Financial Statements for the period ended 30 June
2023 (continued)
9. Investment properties
(Unaudited) (Audited)
30 June 31 December
2023 2022
EUR EUR
Beginning of year 47,517,500 38,144,730
Additions - 7,177,500
Additions - further plot CSB - 1,470,562
Disposals - -
Fair value adjustment - 724,708
----------- -----------
Total investment property 47,517,500 47,517,500
----------- -----------
Ivan Vazov 1 Building 11,550,000 11,550,000
Camp South Beach 16,430,000 16,430,000
Camp South Beach additional plots 1,500,000 1,500,000
Byala Land 10,860,000 10,860,000
Star Mill 7,177,500 7,177,500
Total investment property 47,517,500 47,517,000
----------- -----------
The Directors confirm that there are no material changes in the
valuation of investments as of 30 June 2023.
The valuations of the other Group properties at 31 December 2022
were based on the most recent independent valuation received for
each property. The valuations were performed by external accredited
independent valuers with recognised professional qualifications and
with recent experience in the location and category of the
investment properties being valued.
The fair value of completed investment property has been
determined on a market value basis in accordance with the RICS "Red
Book". In arriving at their estimates of market values, the valuers
have used their market knowledge and professional judgement,
historical transactional comparable and discounted cash flow
forecasts. The highest and best use of the investment properties is
not considered to be different from its current use.
The cost of the investment properties comprises their purchase
price and directly attributable expenditure. Directly attributable
expenditure includes professional fees for legal services and stamp
duty land tax.
In November 2022, CSB acquired several plots behind the camp
site for total consideration of EUR1,470,562, with the aim to
achieve synergy and optimization with the joint development and
management of CSB, the newly acquired Black Sea Star Hotel and
future developments on the plots.
Notes to the Financial Statements for the period ended 30 June
2023 (continued)
10. Intangible assets
At the end of 2020, after participating in an open concession
award procedure, the Group through Camping South Beach received the
concession rights over the sea beach "Camping Gradina". During the
active summer season of 2021, the beach is managed by CSB under the
terms of a lease agreement. The concession agreement enters into
force on 17.10.2020, and at the beginning of 2021 the handover of
the sea beach by the grantor Ministry of Tourism to the
concessionaire was carried out. The term of the contract is 20
years. The concession contract of CSB grants the right to operate
the sea beach, performing alone or through subcontractors providing
visitors to the sea beach of the following services: beach
services, including the provision of umbrellas and sunbeds,
services in fast food restaurants, sports and entertainment
services, water attraction services, health and rehabilitation
services and other events, after prior agreement with the grantor.
A condition for operation of the concession site is the
implementation of mandatory activities, which include provision of
water rescue activities, security of the adjacent water area,
health and medical services for beach users, sanitary and hygienic
maintenance of the beach, maintenance for use of the elements
of
the technical infrastructure, the temporary connections, the
movable objects, the facilities and their safe functioning.
In 2020 the Group has paid the first due concession fee, which
provides the period from the date of entry into force of the
concession agreement until the end of the same calendar year and
the period from January 1 of the last calendar year in which the
concession agreement is valid until the date upon expiration of the
contract.
According to the financial model presented by the Company, which
is accepted by the grantor and is an integral part of the
concession agreement, for the concession period the Group will make
additional investments related to the implementation of mandatory
activities and investments to improve access to the beach. After
the expiration of the concession contract, all constructed sites
remain the property of the grantor. The activities related to the
operation of the concession site are performed by the
concessionaire at his risk and at his expense. The cost of the
acquired intangible assets was EUR655,876 and no amortization
expenses were recognized in 2020. The acquired intangible asset was
amortized by EUR17,264 (2022: EUR49,191) in the current period.
11. Acquisition of a subsidiary
On 18 July 2022, the Company through its owned subsidiary, BSPF
Project 1 EAD, acquired 100% of share capital Star Mil EOOD ("Star
Mil") including all its assets and liabilities. Star Mil owns the
Black Sea Star hotel complex, located in a prime location on the
Black Sea Coast, behind the Company's existing site at Camping
Gradina. The Acquisition of Star Mil provides opportunities for
synergies and economies of scale with the joint development and
management of Camping Gradina and Black Sea Star.
The consideration for this acquisition was EUR5.15 million. BSPF
Project 1 EAD acquired EUR7.83 million worth of outstanding loans
due to the company's previous parent company.
On 24 July 2022, the transaction for the shares was finalized
and the acquisition recorded in the Trade Register in Bulgaria.
This is the date that the group obtained control of Star Mil.
The property was deemed to have a fair value at acquisition of
EUR7,177,500.
Since the acquisition Star Mill has contributed EUR20,740 to
group revenue and loss of EUR429,377 to group profit. If the
acquisition had occurred on 1 January 2022, group revenue would
have been EUR1,159,445 and group profit for the year would have
been EUR3,832,081.
Notes to the Financial Statements for the period ended 30 June
2023 (continued)
11. Acquisition of a subsidiary (continued)
The fair value of the identifiable assets and liabilities of
Star Mil as at the date of acquisition were:
Pre- acquisition Fair value Recognised
carrying adjustments value on
value acquisition
EUR EUR EUR
Investment property 3,270,579 3,906,921 7,177,500
Plant and equipment - - -
Materials 232,738 - 232,738
Trade and other receivables 27,575 - 27,575
Cash and cash equivalents 151 - 151
Trade and other payables (138,775) - (138,775)
Long/short loans (7,855,597) 7,834,174 (21,423)
------------------------------------ ----------------- ------------- -------------
Total net identifiable assets (4,463,329) 11,741,095 7,277,766
------------------------------------ ----------------- ------------- -------------
Purchase consideration transferred 5,150,001
-------------
Bargain purchase on acquisition (2,127,765)
-------------
12. Trade and other receivables
(Unaudited) (Audited)
30 June 31 December
2023 2022
EUR EUR
Trade receivables* 1,613,957 1,798,839
Amount receivable from the sale of the ECDC
group* 2,000,000 4,500,000
Prepayments 71,741 32,333
3,685,698 6,331,172
------------ ------------
*All amounts are due within one year. The expected credit losses
(ECL) for this amount is nil. On 30 May 2023 Black Sea Property
received EUR2.5million from the price. The remaining balance were
received on 6 July 2023.
13. Issued share capital
(Unaudited) (Audited)
Authorised As at As at
30 June 31 December
2023 2022
Founder shares of no par value 10 10
Founder shares of no par value Unlimited Unlimited
Issued and fully paid EUR EUR
2 Founders shares of no par value (2022: - -
2)
1,813,323,603 ordinary shares of no par
value (2022: 1,813,323,603) 70,699,442 70,699,442
The Founders shares do not carry any rights to dividends or
profits and on liquidation they will rank behind Shares for the
return of the amount paid up on each of them. The shares carry the
right to receive notice of and attend general meetings, but carry
no right to vote thereat unless there are no Participating Shares
in issue.
Capital management
The Directors consider capital to be the net assets of the
Group. The capital of the Company will be managed in accordance
with the Investment Strategy documented on the Company's
website.
Notes to the Financial Statements for the period ended 30 June
2023 (continued)
14. Bank Loans
(Unaudited) (Audited)
30 June 31 December
2023 2022
EUR EUR
Loan from UniCredit (a & c) 8,057,661 7,795,499
Loan from BACB (b) 3,971,036 3,968,384
Central Cooperative Bank (d) 8,216,757 8,192,595
------------ -----------
20,245,454 19,956,478
------------ -----------
Long term bank loans 18,161,392 18,185,200
Current bank loans 2,084,062 1.771.278
------------ -----------
Reconciliation of bank loans
Beginning of year (gross loan) 19,956,478 16,289,811
Bank loan arrangement fees (2,515) -
Loan received 354,902 5,099,630
Interest charged 314,338 472,617
Principal repayments (79,350) (1,366,680)
Interest payments (298,399) (538,900)
Total bank loans 20,245,454 19,956,478
-------------------------------- ------------ -----------
a) In October 2017, the Company entered into a secured debt
funding of EUR7 million from UniCredit Bulbank AD ("UniCredit"), a
leading Bulgarian commercial bank which was used to complete the
acquisition of the Ivan Vazov 1 Building. The debt funding from
UniCredit is secured by a commercial mortgage on the property
valued at EUR11,550,000 (see note 10). The term of the debt funding
is thirty-six months from date of execution of the loan
documentation. The repayment shall be made as a one-off payment on
the repayment deadline. The company renegotiated the terms of the
loan, extending the repayment period until 30 November 2033 and
changed the margin to the interest rate to 2%.
The interest on the loan is now the internal interest percentage
by the bank plus 2.00% (2022: 2%).
The company entered into an agreement with Unicredit Bulbank AD
("UniCredit"), a leading Bulgarian commercial bank, which involved
revised and extended lending terms for the construction of the Ivan
Vazov 1 Building.
b) In 2022, the BSPF Project 1 received financing from a
commercial bank in the amount of EUR 4,167,028. The financing was
granted in connection with the acquisition of an investment in Star
Mill EOOD. The loan is repayable by October 20, 2030 in instalments
according to a repayment plan. The loan is charged a floating
interest sum of LEONIA Plus and a risk allowance. The loan is
secured by the following assets:
-- Receivables of the BSPF Project 1 from Star Mill EOOD;
-- Bank deposit of the BSPF Project 1 of EUR 102,258, which will
be released after full payment to the creditor;
-- Mortgage of the real estate of Star Mill EOOD
-- Current and future funds of the BSPF Project 1 and Star Mill
EOOD on current accounts opened with the creditor bank,
Notes to the Financial Statements for the period ended 30 June
2023 (continued)
14. Bank Loans (continued)
c) In November 2021, the Company entered into a secured debt
funding of up to EUR2.3 million from UniCredit Bulbank AD
("UniCredit"), a leading Bulgarian commercial bank which was used
to partly finance the construction costs for the planned renovation
of the roof and overhaul of the administrative building known as
the Ivan Vazov 1 Building. The secured debt funding is made up of
an investment limit of up to EUR1.8 million and a revolving limit
of up to EUR0.5 million. The debt funding from UniCredit is secured
by a commercial mortgage on the property valued at EUR11,550,000
(see note 10). The debt funding is also secured by a first rank
pledge of all the receivables, claims, rights and interests, both
current and future, of the company along with a second ranking
registered pledge of the commercial enterprise of the company and a
second ranking pledge of 100% of the shares of the capital of the
company. The utilization deadline of EUR1.5 million of the
investment limit is no later than 30 November 2023 while the
utilization deadline of the remaining EUR0.3 million is no later
than 30 November 2024. There is a grace period on the repayment of
the principal amount due until 30 November 2023. After this date
the principal will be repaid in equal monthly instalments. Interest
is also repayable monthly with no grace period agreed. The
repayment period is up until 30 November 2033. The utilization
deadline of EUR0.5 million of the revolving limit is no later than
30 November 2023.The repayment of the revolving limit is made
within 6 months of each utilized amount and the repayment period is
up until 30 May 2024.
d) Central Cooperative bank loan and overdraft
(Unaudited) (Audited)
30 June 31 December
2023 2022
EUR EUR
Central Cooperative Bank overdraft (i) 667,665 664,234
Central Cooperative Bank overdraft (ii) 6,192,155 6,178,112
Central Cooperative Bank investment loan
(ii) 1,356,937 1,350,248
------------ ------------
8,216,757 8,912,594
------------ ------------
(i) This is an overdraft with Central Cooperative Bank. The
interest on the account is 4% and was repayable on 24 June 2020
however the terms of the contract were extended to 24 June 2022. At
the date these financial statements were signed the Company made an
extension of the credit repayment period by 12 months.
(ii) The interest rate on the overdraft and the investment loan
is 3.6%. The maturity date for both the overdraft and the
investment loan is 21 January 2028.
In March 2020, the Group successfully negotiated reduction of
the interest rates on the loans due to Central Cooperative Bank to
2.8%. The loan is secured by the commercial property of South Beach
(Gradina) Camp which includes all the tangible fixed assets of the
property along with the mortgage on the land.
Notes to the Financial Statements for the period ended 30 June
2023 (continued)
15. Trade and other payables
Non-current trade and other payables can be presented as
follows:
(Unaudited) (Audited)
30 June 31 December
2023 2022
EUR EUR
Concession payable 528,775 539,929
528,775 539,929
------------ ------------
The current trade and other payables can be presented as
follows:
(Unaudited) (Audited)
30 June 31 December
2023 2022
EUR EUR
Trade creditors 429,806 188,499
Concession payable 23,822 23,823
Other payables 628,544 514,004
------------ ------------
1,082,172 726,326
------------ ------------
Tax liability 153,796 80,426
------------ ------------
16. Related party transactions
In 2022 the Group obtained a short-term loan of EUR 2,500,000
from Neo London Capital AD at a fixed interest rate of 4.25% which
the principal amount was paid. However, at the end of the period
the interest amount was still payable of EUR109,784 (2022:
EUR65,808).
In July 2017, the Company appointed Phoenix Capital Management
JSC as its investment adviser with responsibility for advising on
the investment of the Company's property portfolio. Phoenix Capital
Holding Plc owns 79.99% of the Phoenix Capital Management JSC
shares. Phoenix Capital Holding Plc, through its wholly owned
subsidiary Mamferay Holdings Ltd, holds 24.81% (31.12.2022: 24.81%)
of the issued share capital of the Company. Phoenix Capital
Management JSC received fees of EUR98,208 (2022: EUR107,358). The
amount outstanding as at 30.06.2023 is EUR115,199 (31.12.2022:
EUR268,062).
Notes to the Financial Statements for the period ended 30 June
2023 (continued)
17. Net asset value per share
(Unaudited) (Unaudited)
30 June 30 June
2023 2022
EUR EUR
Net assets attributable to owners of the parent
(EUR) 28,705,079 24,314,834
Number of ordinary shares outstanding 1,813,323,603 1,813,323,603
Net Asset Value (cents) 1.58 1.34
------------- -------------
18. Events after reporting date
Signed agreement for acquisition of Grand Hotel Varna AD
Black Sea Property PLC has signed an agreement to acquire 98.27%
of Grand Hotel Varna AD (the "Acquisition").
Grand Hotel Varna AD wholly owns GHV-Dolphins EAD, a Bulgarian
company which holds the title to real estate comprising three
hotels and a beach marina resort (together, the "Resort"), situated
in a prime location on the Black Sea Coast, with excellent
accessibility.
The primary purpose of the Acquisition is to strengthen Black
Sea Property's hospitality investments, by adding desirable hotels
to its existing investment in Camping South Beach.
The consideration payable for the Acquisition is EUR 28 million
in cash, of which an initial non-refundable deposit of EUR 1.6
million was paid upon signing of the agreement. The property assets
being acquired have been independently valued at EUR 19 million,
and the mutual fund portfolio is currently valued at EUR 12
million.
BSP has raised EUR12million through the issue of unsecured loan
notes to certain existing shareholders. The proceeds of the issue
of the Loan Notes have been used to pay tranches of the
consideration for the Acquisition.
To satisfy the balance of the consideration, the Company will
need to raise additional funds. Subject to securing the required
funding, which the Directors are confident of achieving, the
Acquisition is expected to be completed by 30 October 2023.
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END
NEXFKLFLXKLXBBB
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September 29, 2023 07:47 ET (11:47 GMT)
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