TIDMOPG
RNS Number : 9038U
OPG Power Ventures plc
08 December 2021
8 December 2021
OPG Power Ventures plc
("OPG", the "Group" or the "Company")
Unaudited results for the six months ended 30 September 2021
OPG (AIM: OPG), the developer and operator of power generation
plants in India, announces its unaudited results for the six months
ended 30 September 2021 ("H1 FY22").
Highlights
-- Revenue for the period increased by 54% to GBP55.6m (H1 FY21: GBP36.1m)
-- H1 FY22 total generation, including deemed generation, of 1.3
billion units (H1 FY21: 0.8 billion units)
-- Average tariff for group captive users in H1 FY22 was Rs5.47 per kWh (H1 FY21: Rs5.60 kWh)
-- Diluted EPS (in pence) at 1.05p (H1 FY21: 2.92p)
-- Net debt, including Non-Convertible Debentures ("NCDs"),
reduced by 69 per cent to GBP5.0m in H1 FY22 (31 March 2021:
GBP16.2m; 30 September 2020: GBP34.9m)
Summary financial information (including historic financial
data):
HY 30 Sep HY 30 Sep FY 31 Mar
21 20 21
GBP million GBP million GBP million
Revenue 55.6 36.1 93.8
------------- ------------- -------------
Adjusted EBITDA* 11.6 19.4 33.7
------------- ------------- -------------
Profit Before Tax 7.4 12.8 21.6
------------- ------------- -------------
Profit After Tax 4.2 11.8 14.1
------------- ------------- -------------
Diluted Earnings Per Share ("EPS")
(pence) 1.05 2.92 3.50
------------- ------------- -------------
* Adjusted EBITDA is calculated as operating profit before
depreciation, amortisation and share based compensation.
Post period end developments and highlights
-- Indonesian coal prices have steadily increased and reached
its peak at the end of October 2021 and since then decreased by
c.50% by the beginning of December 2021;
-- Due to high coal prices and freight costs generation
decreased and Plant Load Factor ("PLF") , incl. deemed,
in October 2021 and November 2021 was 19.43% and 21.8% respectively (H1 FY20: 46%);
-- Subsequent to 30 September 2021, OPG sold a cargo of coal and
realised a profit of GBP3.8 million (Rs.0.4 billion);
Arvind Gupta, Chairman, commented :
"OPG's power generation recovered during H1 FY21. However, the
prices of international coal and freight significantly increased
during the second quarter of FY22 because of an unprecedented
increase in demand for coal due to Chinese related geopolitical
issues, revival of economies and heavy rains in certain coal-mining
areas. Post period, our power generation was reduced due to high
coal prices and freight costs. This is expected to affect our
operational volumes, revenue and operating profit significantly for
the 12 months ending 31 March 2022. However, coal prices moderated
in November 2021 which provides us with confidence that the coal
markets are normalising."
Presentation
The Company will be presenting via the Investor Meet Company at
11 am on 13 D ecember 2021. The presentation will give investors
and analysts the opportunity to listen to management discuss the
Company's interim results for the six months ended 30 September
2021.
The presentation will be hosted by Dmitri Tsvetkov (Chief
Financial Officer) and there will be an opportunity for Q&A at
the end of the meeting. Questions can be submitted pre-event via
the Investor Meet Company dashboard up until 9am the day before the
meeting or at any time during the live presentation.
To sign up to the Company's presentation for free via Investor
Meet Company please click the following link:
https://www.investormeetcompany.com/opg-power-ventures-plc/register-investor
Investors who already follow the Company on the Investor Meet
Company platform will automatically be invited.
For further information, please visit www.opgpower.com or
contact:
+44 (0) 782 734
OPG Power Ventures PLC 1323
Dmitri Tsvetkov
Cenkos Securities (Nominated Adviser +44 (0) 20 7397
& Broker) 8900
Stephen Keys / Katy Birkin
+44 (0) 20 7920
Tavistock (Financial PR) 3150
Simon Hudson / Nick Elwes
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the UK version of the EU Market Abuse Regulation (2014/596) which
is part of UK law by virtue of the European Union (Withdrawal) Act
2018, as amended and supplemented from time to time.
Chairman's Statement
Introduction
Events of H1 FY22 have been dominated by the abnormal increase
of coal prices and freight tariffs and the global impact of
COVID-19. The Board remains convinced that our strategy of
maintaining operational excellence and paying down borrowings has
helped the Company to mitigate the impact of the commodities prices
volatility and the pandemic while providing a sound platform for
the long term benefit of all our stakeholders.
Operations Summary
Details HY HY FY
30 Sep 21 30 Sep 31 Mar 21
20
---------- ------- ----------
Generation (million kWh)
---------- ------- ----------
414 MW Plant generation 1,040 635 1,701
---------- ------- ----------
Additional "deemed" offtake at Chennai 255 196 406
---------- ------- ----------
Total Generation (MUe)(1) 1,296 831 2,107
---------- ------- ----------
Reported Average PLF (%) 71.3% 46% 58%
---------- ------- ----------
Average Tariff Realised (Rs) 5.47 5.60 5.52
---------- ------- ----------
Note: (1) MU / Mue - millions units or kWh of equivalent
power
Focus on Maximizing Asset Performance and Deleveraging
Total Generation, including deemed generation, in H1 FY22 was
1.3 billion units, 56 per cent higher than in H1 FY21. Average
group captive users' tariffs realised in H1 FY22 were Rs 5.47 per
kWh (H1 FY21: Rs5.60 per kWh; FY21: Rs5.52 per kWh).
Subsequent to 30 September 2021, the Company sold a cargo of
coal and realised a profit of GBP3.8 million (Rs.0.4 billion).
As at 30 September 2021 net debt has been significantly reduced
to GBP5.0m (31 March 2021: GBP16.2m; 30 September 2020: GBP34.9m)
while total borrowings were GBP47.8 million, comprised of GBP19.6
million of NCDs and GBP19.6 million of existing term loans, with
scheduled repayments spread from June 2022 to June 2024, as well as
working capital loans of GBP8.6 million.
Over the last several months the prices of thermal coal and
freight have surged primarily due to Chinese related geopolitical
issues, increased imports of coal and other goods by China and
other Asian countries on the back of post COVID-19 economic
recovery. Whilst OPG was partially covered from increases in prices
with fixed price agreements for coal and freight, the Company
remains exposed to market fluctuations for the unhedged portion of
coal consumption and freight. However, the Company is exploring
various options including sourcing the coal from other geographies
(including domestic sources) to reduce the per unit cost of
electricity. The Company is expecting to cover at least a portion
of its coal needs from the domestic sources under long-term fixed
price arrangements. We continue to believe that the prices of coal
and freight will moderate later in the short-term.
62 MW Karnataka Solar projects
As previously announced, the Board has decided to sell OPG's
interest in 62MW Karnataka solar projects and these assets remain
in a disposal process.
Building a sustainable future
Rapid growth in urbanisation, universal electrification, and a
renewable energy transition driven by climate change, implies that
India's incremental power needs will largely be met by renewable
energy. Our business strategy is perfectly aligned with this,
offering us an opportunity to unlock value for all our stakeholders
in the years to come. OPG has been developing its ESG strategy
which, among other matters, includes objectives to reduce its
carbon footprint. As part of this strategy, the Company is
evaluating various options to increase its renewable energy asset
base, notably solar power, and to establish joint ventures to roll
out various energy transition technologies, including energy
efficiency improvements, green hydrogen, etc. These initiatives
will ensure that OPG delivers year-on-year improvements to reach
the Company's emissions reduction targets in the medium and
longer-term.
The Indian Economy and Power Sector
As a consequence of COVID-19 the IMF's World Economic Update in
November 2021 estimated that the Indian annual GDP growth rate will
be 9.5 per cent in 2021 and 8.5 per cent in 2022.
The Reserve Bank of India, the country's central bank and
banking regulator, has taken several steps to mitigate the negative
impact of the lockdown on the economy through various monetary
policy measures: including a reduction in repo and reverse repo
rates, a moratorium on loan repayments, a 90 days freeze on
non-performing assets declaration, helping MSMEs with stimulus
packages and credit lines for incentivising industries. These
measures coupled with the easing of lockdown restrictions in a
phased manner are helping economic activity to resume.
Indian power consumption per capita was only 1,208 kWh in FY
2020. It is expected that this will catch up with developed
economies with similar social and economic conditions over
time.
The all-India electricity demand during the period from April
2021 to September 2021 has increased by 12.7% to 707 billion units
("BU") on a year-on-year (YoY) basis supported by a lower base,
improvement in economic activity and lower than normal monsoons
leading to higher demand from the agriculture segment during July
and August 2021.
India's power consumption rose by 3.6% to 100.42 BU in November
2021 compared with 96.88 BU in November 2020 and 93.94 BU in
November 2019.
Outlook
During the first seven months to the end of October 2021 the
prices of thermal coal and freight have surged primarily due to
increased imports of coal and other goods by China and other Asian
countries on the back of post COVID-19 economic recovery. However,
coal prices decreased by approximately 50% by the beginning of
December 2021 and the Company anticipates that coal prices will
normalise over time.
While generation and revenue recovered in H1 FY22, and the
Company was profitable and cash generative but we expect that the
Company's full year FY22 generation, we will not be operating at
full capacity and revenue and net profit will reduce in comparison
with FY21 due to the negative impact of high coal prices and
freight costs. This will also impact the Company's net debt
position as at 31 March 2022.
We believe that the medium-term and long-term fundamentals of
the Group remain unchanged and post-COVID-19 recovery and
normalisation of coal prices and freight costs, the Company expects
to prosper as management seeks to deliver its long term, profitable
and sustainable business model. We will also continue to focus on
advancing our ESG agenda.
Consolidated Statement of Financial Position
As at 30 September 2021
(All amount in GBP, unless As at As at As at
otherwise stated)
Notes 30 Sep 2021 30 Sep 2020 31 March
2021
-------------------------------- ------ ------------- ------------ -------------
Assets
Non-current assets
Intangible assets 14 1,206 5,716 2,394
Property, plant and equipment 15 171,809,578 186,412,926 172,716,040
Other long-term assets 16 83,308 405,534 69,853
Restricted cash 19 9,262,942 26,567 8,194,412
181,157,034 186,850,743 180,982,699
------------- ------------ -------------
Current assets
Inventories 18 13,634,187 7,866,415 12,186,644
Trade and other receivables 17 17,329,073 24,238,726 14,829,989
Other short-term assets 16 32,026,018 6,837,783 17,805,554
Current tax assets (net) 1,147,676 1,292,128 1,131,342
Restricted cash 19(b) 3,122,794 4,859,556 3,219,356
Cash and cash equivalents 19(a) 9,440,379 9,374,849 8,920,952
Assets held for sale 7 16,638,171 14,720,769 16,425,368
93,338,298 69,190,226 74,519,205
------------- ------------ -------------
Total assets 274,495,332 256,040,969 255,501,904
============= ============ =============
Equity and liabilities
Equity
Share capital 20 58,909 58,909 58,909
Share premium 20 131,451,482 131,451,482 131,451,482
Other components of equity (11,055,720) (3,746,172) (12,735,470)
Retained earnings 46,123,296 39,587,495 41,910,280
Equity attributable to owners
of the Company 166,577,967 167,351,714 160,685,201
Non-controlling interests 876,369 881,530 881,869
Total equity 167,454,336 168,233,244 161,567,070
------------- ------------ -------------
Liabilities
Non-current liabilities
Borrowings 22 17,938,299 21,740,994 22,260,206
Non-Convertible Debentures 22 20,043,153 21,110,407 19,840,089
Trade and other payables 613,923 176,936 607,702
Deferred tax liabilities (net) 13 16,369,637 7,485,509 12,994,371
54,965,012 50,513,846 55,702,368
------------- ------------ -------------
Current liabilities
Borrowings 22 9,830,045 1,430,290 4,510,358
Trade and other payables 37,103,471 35,358,949 32,495,799
Other liabilities 6(a) 5,142,468 504,640 1,226,309
52,075,984 37,293,879 38,232,466
------------- ------------ -------------
Total liabilities 107,040,996 87,807,725 93,934,834
------------- ------------ -------------
Total equity and liabilities 274,495,332 256,040,969 255,501,904
============= ============ =============
The notes are an integral part of these consolidated financial
statements.
The financial statements were authorised for issue by the board
of directors on 7 December 2021 and were signed on its behalf by
Arvind Gupta, Chairman and Dmitri Tsvetkov, Chief Financial Officer
.
Consolidated Statement of Comprehensive Income
For the six months period ended 30 September 2021
Six months Six months
(All amount in GBP, unless otherwise Period Period
stated) ended ended Year ended
30 Sep 30 Sep 31 March
Notes 2021 2020 2021
---------------------------------------- ------ ------------- ------------- -------------
Revenue 8 55,603,742 36,089,887 93,823,933
Cost of revenue 9 (41,068,565) (22,134,375) (56,893,065)
Gross profit 14,535,177 13,955,512 36,930,868
------------- ------------- -------------
Other Operating income 10(a) - 9,628,703 9,420,712
Other income 10(b) 1,240,131 505,562 1,921,546
Distribution cost (2,037,380) (2,947,582) (4,791,056)
General and administrative expenses (2,247,971) (2,000,180) (7,256,153)
Expected credit loss on trade
receivables - - (3,025,055)
Depreciation and amortisation (2,800,143) (2,983,195) (5,705,538)
Operating profit 8,689,814 16,158,820 27,495,324
------------- ------------- -------------
Finance costs 11 (2,675,395) (3,681,194) (6,803,137)
Finance income 12 1,367,175 284,328 868,439
------------- ------------- -------------
Profit before tax 7,381,594 12,761,954 21,560,626
Tax expense 13 (3,390,062) (1,865,120) (8,447,699)
-------------
Profit for the year from continued
operations 3,991,532 10,896,834 13,112,927
------------- ------------- -------------
Gain/(Loss) from discontinued
operations, including Non-Controlling
Interest 7 212,803 881,687 999,398
Profit for the year 4,204,335 11,778,521 14,112,325
============= ============= =============
Profit for the year attributable
to:
Owners of the Company 4,213,016 11,769,020 14,091,806
Non - controlling interests (8,682) 9,501 20,518
4,204,334 11,778,521 14,112,324
============= ============= =============
Earnings per share from continued
operations
Basic earnings per share (in pence) 1.00 2.72 3.27
Diluted earnings per share (in
pence) 0.99 2.70 3.25
Earnings per share from discontinued
operations
Basic earnings per share (in pence) 0.05 0.27 0.30
Diluted earnings per share (in
pence) 0.05 0.27 0.30
Earnings per share
-Basic (in pence) 1.05 2.94 3.52
-Diluted (in pence) 1.05 2.92 3.50
Other comprehensive income / (loss)
Items that will be reclassified
subsequently to profit or loss
Exchange differences on translating
foreign operations 1,582,361 (2,746,435) (12,860,261)
Items that will be not reclassified
subsequently to profit or loss
Exchange differences on translating
foreign operations, relating to
non-controlling interests 3,182 (2,644) (13,322)
Total other comprehensive income
/ (loss) 1,585,544 (2,749,079) (12,873,583)
------------- ------------- -------------
Total comprehensive income 5,789,878 9,029,442 1,238,741
============= ============= =============
Total comprehensive income / (loss)
attributable to:
Owners of the Company 5,795,377 9,022,585 1,231,546
Non-controlling interest (5,500) 6,857 7,196
5,789,878 9,029,442 1,238,741
============= ============= =============
The notes are an integral part of these consolidated financial
statements.
Consolidated Statement of Changes in Equity
For the six months period ended 30 September 2021
(All amount in Issued Foreign Total
GBP, unless capital currency attributable
otherwise (No. of Ordinary Share Other translation Retained to owners Non-controlling
stated) shares) shares premium reserves reserve earnings of parent interests Total equity
At 1 April 2020 400,733,511 58,909 131,451,482 7,486,127 (8,809,114) 27,818,474 158,005,878 497,955 158,503,832
------------ --------- ------------ ---------- ------------- ----------- ------------- ---------------- -------------
Employee Share
based payment
LTIP
(Note 21) - - - 535,247 - - 535,247 - 535,247
Transaction with
owners - - - 535,247 - - 535,247 - 535,247
------------ --------- ------------ ---------- ------------- ----------- ------------- ---------------- -------------
Profit for the
year - - - - - 14,091,806 14,091,806 20,518 14,112,324
Deconsolidation - - - - 912,531 - 912,531 376,718 1,289,249
Other
comprehensive
income - - - - (12,860,261) - (12,860,261) (13,322) (12,873,583)
Total
comprehensive
income - - - - (11,947,730) 14,091,806 2,144,076 383,914 2,527,990
------------ --------- ------------ ---------- ------------- ----------- ------------- ---------------- -------------
At 31 March 2021 400,733,511 58,909 131,451,482 8,021,374 (20,756,844) 41,910,280 160,685,201 881,869 161,567,070
------------ --------- ------------ ---------- ------------- ----------- ------------- ---------------- -------------
At 1 April 2021 400,733,511 58,909 131,451,482 8,021,374 (20,756,844) 41,910,280 160,685,201 881,869 161,567,070
Employee Share
based payment
LTIP
(Note 21) - - - 97,389 - - 97,389 - 97,389
Transaction with
owners - - - 97,389 - - 97,389 - 97,389
------------ --------- ------------ ---------- ------------- ----------- ------------- ---------------- -------------
Profit for the
year - - - - - 4,213,016 4,213,016 (8,682) 4,204,334
Other
comprehensive
income - - - - 1,582,361 - 1,582,361 3,182 1,585,543
Total
comprehensive
income - - - - 1,582,361 4,213,016 5,795,377 (5,500) 5,789,877
------------ --------- ------------ ---------- ------------- ----------- ------------- ---------------- -------------
At 30 Sep 2021 400,733,511 58,909 131,451,482 8,118,763 (19,174,483) 46,123,296 166,577,967 876,369 167,454,336
------------ --------- ------------ ---------- ------------- ----------- ------------- ---------------- -------------
The notes are an integral part of these consolidated financial
statements.
Consolidated statement of cash flows
For the six months period ended 30 September 2021
Six months Six months
Period ended Period ended Year ended
(All amount in GBP, unless otherwise 31 March
stated) Notes 30 Sep 2021 30 Sep 2020 2021
--------------------------------------- ------ -------------- -------------- -------------
Cash flows from operating activities
Profit before income tax including
discontinued operations 7,594,397 13,643,638 22,560,024
Adjustments for:
(Profit)/Loss from discontinued
operations, net 7 (212,803) (881,687) (999,398)
Unrealised foreign exchange
loss 9(c) 35,633 231,416 46,931
Financial costs 11 2,638,111 3,449,773 6,756,206
Financial income 12 (1,367,175) (284,328) (864,156)
Share based compensation costs 21 97,389 267,623 535,247
Depreciation and amortisation 2,800,143 2,983,195 5,705,538
Expected credit loss on Trade
receivables - - 3,025,055
Changes in working capital
Trade and other receivables (2,297,761) 2,190,563 7,404,759
Inventories (1,294,895) 3,414,812 (1,654,539)
Other assets (2,590,907) 1,750,744 4,976,235
Trade and other payables 3,507,337 (6,025,769) (7,106,516)
Other liabilities 3,611,458 (62,560) 490,711
Cash generated from continuing
operations 12,520,927 20,677,420 40,876,097
Taxes paid (673,053) (730,037) (709,277)
-------------- -------------- -------------
Cash provided by operating activities
of continuing operations 11,847,874 19,947,383 40,166,820
Net cash provided by operating
activities 11,847,874 19,947,383 40,166,820
-------------- -------------- -------------
Cash flows from investing activities
Purchase of property, plant
and equipment (including capital
advances) (181,177) (320,380) (506,222)
Interest received 1,367,175 284,329 864,156
Movement in restricted cash (837,100) 2,508,449 (4,655,096)
Purchase of investments (10,490,070) (754,439) (25,250,994)
Cash (used in) / from investing
activities of continuing operations (10,141,172) 1,717,959 (29,548,156)
Net cash (used in) / from investing
activities (10,141,172) 1,717,959 (29,548,156)
-------------- -------------- -------------
Cash flows from financing activities
Proceeds from borrowings (net
of costs) 1,799,014 21,133,852 21,981,043
Repayment of borrowings (1,095,275) (33,339,333) (27,938,844)
Finance costs paid (1,992,151) (3,449,773) (5,812,498)
-------------- -------------- -------------
Cash used in financing activities
of continuing operations (1,288,412) (15,655,254) (11,770,299)
Net cash used in financing activities (1,288,412) (15,655,254) (11,770,299)
-------------- -------------- -------------
Net (decrease) / Increase in
cash and cash equivalents from
continuing operations 418,290 6,010,088 (1,151,635)
Net (decrease) / increase in
cash and cash equivalents 418,290 6,010,088 (1,151,635)
Cash and cash equivalents at
the beginning of the year 8,920,952 3,438,830 3,438,830
Cash and cash equivalents on
deconsolidation - - (28,560)
Exchange differences on cash
and cash equivalents 101,137 (74,069) 6,662,317
Cash and cash equivalents at
the end of the year 9,440,379 9,374,849 8,920,952
-------------- -------------- -------------
The notes are an integral part of these consolidated financial
statements.
Notes
(All amount in GBP, unless otherwise stated)
1. Nature of operations
OPG Power Ventures Plc ('the Company' or 'OPGPV'), and its
subsidiaries (collectively referred to as 'the Group') are
primarily engaged in the development, owning, operation and
maintenance of private sector power projects in India. The
electricity generated from the Group's plants is sold principally
to public sector undertakings and heavy industrial companies in
India or in the short term market. The business objective of the
Group is to focus on the power generation business within India and
thereby provide reliable, cost effective power to the industrial
consumers and other users under the 'open access' provisions
mandated by the Government of India.
2. Statement of compliance
The consolidated financial statements of the Group have been
prepared in accordance with International Financial Reporting
Standards (IFRS) - as issued by the International Accounting
Standards Board and the provisions of the Isle of Man, Companies
Act 2006 applicable to companies reporting under IFRS.
3. General information
OPG Power Ventures Plc, a limited liability corporation, is the
Group's ultimate parent Company and is incorporated and domiciled
in the Isle of Man. The address of the Company's registered Office,
which is also the principal place of business, is 55 Athol street,
Douglas, Isle of Man IM1 1LA. The Company's equity shares are
listed on the AIM Market of the London Stock Exchange ("AIM").
The Consolidated Financial statements for the period ended 30
September 2021 were approved and authorised for issue by the Board
of Directors on 7 December 2021.
4. Recent accounting pronouncements
a) Standards, amendments and interpretations to existing
standards that are not yet effective and have not been adopted
early by the Group
At the date of authorisation of these financial statements,
certain new standards, and amendments to existing standards have
been published by the IASB that are not yet effective, and have not
been adopted early by the Group. Information on those expected to
be relevant to the Group's financial statements is provided
below.
Management anticipates that all relevant pronouncements will be
adopted in the Group's accounting policies for the first period
beginning after the effective date of the pronouncement. New
standards, interpretations and amendments not either adopted or
listed below are not expected to have a material impact on the
Group's financial statements.
b) Changes in accounting Standards
Amendments to IFRS 16, "Covid-19-Related Rent
Concessions-Amendment to IFRS 16,"
In May 2020, the IASB issued Covid-19-Related Rent Concessions
(Amendment to IFRS 16) that provides practical relief to lessees in
accounting for rent concessions occurring as a direct consequence
of Covid-19, by introducing a practical expedient to IFRS 16. The
practical expedient permits a lessee to elect not to assess whether
a Covid-19-related rent concession is a lease modification. A
lessee that makes this election shall account for any change in
lease payments resulting from the Covid-19-related rent concession
the same way it would account for the change applying IFRS 16 if
the change were not a lease modification. The practical expedient
applies only to rent concessions occurring as a direct consequence
of Covid-19 and only if all of the prescribed conditions are met.
The Group has not received any rent concessions hence so there is
no impact on the presentation of these Financial Statements.
c) Standards and Interpretations Not Yet Applicable
The IASB and the IFRS IC have issued the following additional
standards and interpretations. Group does not apply these rules
because their application is not yet mandatory. Currently, however,
these adjustments are not expected to have a material impact on the
consolidated financial statements of the Group:
Mandatorily effective for periods beginning on or after 1
January 2022
i) IAS 16 Property, Plant and Equipment (Amendment - Proceeds
before Intended Use)
ii) AS 37 Provisions, Contingent Liabilities and Contingent
Assets (Amendment - Onerous Contracts - Cost of Fulfilling a
Contract)
iii) IFRS 3 Business Combinations (Amendment - Reference to the
Conceptual Framework)
Mandatorily effective for periods beginning on or after 1
January 2023
i) IFRS 17, "Insurance Contracts," published in May 2017,
expected first-time application in next fiscal year.
ii) IAS 1 Presentation of Financial Statements and IAS8
Accounting Policies, Changes in Accounting Estimates and
Errors(Amendment - Classification of Liabilities as Current or
Non-current)
iii) IAS 1 Presentation of Financial Statements and IFRS
Practice Statement 2 (Amendment - Disclosure of Accounting
Policies)
iv) IAS 8 Accounting policies, Changes in Accounting Estimates
and Errors (Amendment - Definition of Accounting Estimates)
v) IAS 12 Income Taxes (Amendment - Deferred Tax related to
Assets and Liabilities arising from a Single Transaction)
5. Summary of significant accounting policies
a) Basis of preparation
The consolidated financial statements of the Group have been
prepared on a historical cost basis, except for financial assets
and liabilities at fair value through profit or loss and financial
assets measured at FVPL.
The consolidated financial statements are presented in
accordance with IAS 1 Presentation of Financial Statements and have
been presented in Great Britain Pounds ('LIR'), the functional and
presentation currency of the Company.
During FY2019, the Company obtained a right to exercise an
option to buy additional 30% equity interest in solar companies.
Effective from FY2021 this right was re-assigned to a third party
along with the related obligations and the results of the
operations of solar companies Aavanti Solar Energy Private Limited,
Mayfair Renewable Energy (I) Private Limited, Aavanti Renewable
Energy Private Limited and Brics Renewable Energy Private Limited
are not consolidated in Group's consolidated financial statements
due to loss of control. The Group continues owning a 31% equity
interest in the solar companies. As it was previously reported,
after evaluation of all options, the Company decided that the most
efficient way to maximise shareholders' value from solar operations
is to dispose solar companies and it initiated process of
disposition of solar companies which met all conditions of IFRS 5
for classification of solar business as Assets held for sale at 30
September 2021 (Note 7).
Going concern
As at 30 September 2021 the Group had GBP9.4m in cash and net
current assets of GBP41.3m. The directors and management have
prepared a cash flow forecast to December 2022, 12 months from the
date this report has been approved.
The Group experiences sensitivity in its cash flow forecasts due
to the exposure to potential increase in USD denominated coal
prices and a decrease in the value of the Indian Rupee. The
Directors and management are confident that the Group will be
trading in line with its forecast and that any exposure to a
fluctuation in coal prices or the exchange rate INR/USD has been
taken into consideration and therefore prepared the financial
statements on a going concern basis.
For the year ended 31 March 2021, the Group had considered the
probable impact arising due to Covid-19 and included a specific
accounting judgement and estimation uncertainty in relation to the
impact of coronavirus on its operations and going concern
assessments. During the six months ended 30 September 2021, the
economy has continued to recover from the effects of the pandemic,
and accordingly the specific accounting judgement and estimation
uncertainty in relation to the impact of coronavirus is
significantly reduced.
b) Basis of consolidation
The consolidated financial statements include the assets,
liabilities and results of the operation of the Company and all of
its subsidiaries as of 30 September 2021. All subsidiaries have a
reporting date of 31 March.
A subsidiary is defined as an entity controlled by the Company.
The parent controls a subsidiary if it is exposed, or has rights,
to variable returns from its involvement with the subsidiary and
has the ability to affect those returns through its power over the
subsidiary. Subsidiaries are fully consolidated from the date of
acquisition, being the date on which effective control is acquired
by the Group, and continue to be consolidated until the date that
such control ceases.
All transactions and balances between Group companies are
eliminated on consolidation, including unrealised gains and losses
on transactions between Group companies. Where unrealised losses on
intra-group asset sales are reversed on consolidation, the
underlying asset is also tested for impairment from a group
perspective. Amounts reported in the financial statements of
subsidiaries have been adjusted where necessary to ensure
consistency with the accounting policies adopted by the Group.
Non-controlling interest represents the portion of profit or
loss and net assets that is not held by the Group and is presented
separately in the consolidated statement of comprehensive income
and within equity in the consolidated statement of financial
position, separately from parent shareholders' equity. Acquisitions
of additional stake or dilution of stake from/ to non-controlling
interests/ other venturer in the Group where there is no loss of
control are accounted for as an equity transaction, whereby, the
difference between the consideration paid to or received from and
the book value of the share of the net assets is recognised in
'other reserve' within statement of changes in equity.
c) Investments in associates and joint ventures
Investments in associates and joint ventures are accounted for
using the equity method. The carrying amount of the investment in
associates and joint ventures is increased or decreased to
recognise the Group's share of the profit or loss and other
comprehensive income of the associate and joint venture, adjusted
where necessary to ensure consistency with the accounting policies
of the Group.
Unrealised gains and losses on transactions between the Group
and its associates and joint ventures are eliminated to the extent
of the Group's interest in those entities. Where unrealised losses
are eliminated, the underlying asset is also tested for
impairment.
d) List of subsidiaries, joint ventures, and associates
Details of the Group's subsidiaries and joint ventures, which
are consolidated into the Group's consolidated financial
statements, are as follows:
i) Subsidiaries
% Voting Right % Economic interest
---------------------- ----------- -------------------
Immediate Country Sept. Sept. March Sept. Sept. March
parent of incorporation 2021 2020 2021 2021 2020 2021
---------------------- ----------- ------------------- ------ ------ ------ ------ ---------- ------
Caromia Holdings
limited ('CHL') OPGPV Cyprus 100 100 100 100 100 100
Gita Power and
Infrastructure
Private Limited,
('GPIPL') CHL India 100 100 100 100 100 100
OPG Power Generation
Private Limited
('OPGPG') GPIPL India 73.77 73.16 71.25 71.25 99.91 99.91
Samriddhi Solar
Power LLP(*) OPGPG India - 73.16 - - 99.91 -
Samriddhi Surya
Vidyut Private
Limited OPGPG India 71.25 73.16 71.25 71.25 99.91 99.91
OPG Surya Vidyut
LLP(*) OPGPG India - 73.16 - - 99.91 -
Powergen Resources
Pte Ltd OPGPV Singapore 98.69 98.56 98.56 100 100 100
(*)During FY21 withdrawn as a partner
from LLP
ii) Associates
Avanti Solar Energy
Private Limited OPGPG India 31 31 31 31 31 31
Mayfair Renewable
Energy (I) Private
Limited) OPGPG India 31 31 31 31 31 31
Avanti Renewable
Energy Private
Limited OPGPG India 31 31 31 31 31 31
Brics Renewable
Energy Private
Limited OPGPG India 31 31 31 31 31 31
e) Foreign currency translation
The functional currency of the Company is the Great Britain
Pound Sterling (GBP). The Cyprus entity is an extension of the
parent and pass through investment entity. Accordingly the
functional currency of the subsidiary in Cyprus is the Great
Britain Pound Sterling. The functional currency of the Company's
subsidiaries operating in India, determined based on evaluation of
the individual and collective economic factors is Indian Rupees ('
' or 'INR'). The presentation currency of the Group is the Great
Britain Pound (GBP) as submitted to the AIM counter of the London
Stock Exchange where the shares of the Company are listed.
At the reporting date the assets and liabilities of the Group
are translated into the presentation currency at the rate of
exchange prevailing at the reporting date and the income and
expense for each statement of profit or loss are translated at the
average exchange rate (unless this average rate is not a reasonable
approximation of the cumulative effect of the rates prevailing on
the transaction dates, in which case income and expense are
translated at the rate on the date of the transactions). Exchange
differences are charged/ credited to other comprehensive income and
recognized in the currency translation reserve in equity.
Transactions in foreign currencies are translated at the foreign
exchange rate prevailing at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies at the
Statement of financial position date are translated into functional
currency at the foreign exchange rate ruling at that date.
Aggregate gains and losses resulting from foreign currencies are
included in finance income or costs within the profit or loss.
INR exchange rates used to translate the INR financial
information into the presentation currency of Great Britain Pound
(GBP) are the closing rate as at 30 September 2021: 99.78 (2021:
100.81, 2020: 94.74) and the average rate for the period ended 30
September 2021: 101.94 (2021 96.72, 2020 : 87.97).
f) Revenue recognition
In accordance with IFRS 15 - Revenue from contracts with
customers, the group recognises revenue to the extent that it
reflects the expected consideration for goods or services provided
to the customer under contract, over the performance obligations
they are being provided. For each separable performance obligation
identified, the Group determines whether it is satisfied at a
"point in time" or "over time" based upon an evaluation of the
receipt and consumption of benefits, control of assets and
enforceable payment rights associated with that obligation. If the
criteria required for "over time" recognition are not met, the
performance obligation is deemed to be satisfied at a "point in
time". Revenue principally arises as a result of the Group's
activities in electricity generation and distribution. Supply of
power and billing satisfies performance obligations. The supply of
power is invoiced in arrears on a monthly basis and generally the
payment terms within the Group are 10 to 45 days.
Revenue
Revenue from providing electricity to captive power shareholders
and sales to other customers is recognised on the basis of biling
cycle under the contractual arrangement with the captive power
shareholders & customers respectively and reflects the value of
units of power supplied and the applicable tariff after deductions
or discounts. Revenue is earned at a point in time of joint meter
reading by both buyer and seller for each billing month.
Interest and dividend
Revenue from interest is recognised as interest accrued (using
the effective interest rate method). Revenue from dividends is
recognised when the right to receive the payment is
established.
g) Operating expenses
Operating expenses are recognised in the statement of profit or
loss upon utilisation of the service or as incurred.
h) Taxes
Tax expense recognised in profit or loss comprises the sum of
deferred tax and current tax not recognised in other comprehensive
income or directly in equity.
Current income tax assets and/or liabilities comprise those
obligations to, or claims from, taxation authorities relating to
the current or prior reporting periods, that are unpaid at the
reporting date. Current tax is payable on taxable profit, which
differs from profit or loss in the financial statements.
Calculation of current tax is based on tax rates and tax laws
that have been enacted or substantively enacted by the end of the
reporting period.
Deferred income taxes are calculated using the liability method
on temporary differences between the carrying amounts of assets and
liabilities and their tax bases. However, deferred tax is not
provided on the initial recognition of goodwill, nor on the initial
recognition of an asset or liability unless the related transaction
is a business combination or affects tax or accounting profit.
Deferred tax on temporary differences associated with investments
in subsidiaries is not provided if reversal of these temporary
differences can be controlled by the Group and it is probable that
reversal will not occur in the foreseeable future.
Deferred tax assets and liabilities are calculated, without
discounting, at tax rates that are expected to apply to their
respective period of realisation, provided they are enacted or
substantively enacted by the end of the reporting period. Deferred
tax liabilities are always provided for in full.
Deferred tax assets are recognised to the extent that it is
probable that they will be able to be utilised against future
taxable income. Deferred tax assets and liabilities are offset only
when the Group has a right and the intention to set off current tax
assets and liabilities from the same taxation authority. Changes in
deferred tax assets or liabilities are recognised as a component of
tax income or expense in profit or loss, except where they relate
to items that are recognised in other comprehensive income or
directly in equity, in which case the related deferred tax is also
recognised in other comprehensive income or equity,
respectively.
i) Financial assets
IFRS 9 Financial Instruments contains regulations on measurement
categories for financial assets and financial liabilities. It also
contains regulations on impairments, which are based on expected
losses.
"Financial assets are classified as financial assets measured at
amortized cost, financial assets measured at fair value through
other comprehensive income (FVOCI) and financial assets measured at
fair value through profit and loss (FVPL) based on the business
model and the characteristics of the cash flows. If a financial
asset is held for the purpose of collecting contractual cash flows
and the cash flows of the financial asset represent exclusively
interest and principal payments, then the financial asset is
measured at amortized cost. A financial asset is measured at fair
value through other comprehensive income (FVOCI) if it is used both
to collect contractual cash flows and for sales purposes and the
cash flows of the financial asset consist exclusively of interest
and principal payments. Unrealized gains and losses from financial
assets measured at fair value through other comprehensive income
(FVOCI), net of related deferred taxes, are reported as a component
of equity (other comprehensive income) until realized. Realized
gains and losses are determined by analysing each transaction
individually. Debt instruments that do not exclusively serve to
collect contractual cash flows or to both generate contractual cash
flows and sales revenue, or whose cash flows do not exclusively
consist of interest and principal payments are measured at fair
value through profit and loss (FVPL). For equity instruments that
are held for trading purposes the group has uniformly exercised the
option of recognizing changes in fair value through profit or loss
(FVPL). Refer to note 29""Summary of financial assets and
liabilities by category and their fair values"".
Impairments of financial assets are both recognized for losses
already incurred and for expected future credit defaults. The
amount of the impairment loss calculated in the determination of
expected credit losses is recognized on the income statement.
Impairment provisions for current and non-current trade receivables
are recognised based on the simplified approach within IFRS 9 using
a provision matrix in the determination of the lifetime expected
credit losses. During this process the probability of the
non-payment of the trade receivables is assessed. This probability
is then multiplied by the amount of the expected loss arising from
default to determine the lifetime expected credit loss for the
trade receivables. On confirmation that the trade receivable will
not be collectable, the gross carrying value of the asset is
written off against the associated provision.
j) Financial liabilities
The Group's financial liabilities include borrowings and trade
and other payables. Financial liabilities are measured subsequently
at amortised cost using the effective interest method. All
interest-related charges and, if applicable, changes in an
instrument's fair value that are reported in profit or loss are
included within 'finance costs' or 'finance income'.
k) Fair value of financial instruments
The fair value of financial instruments that are actively traded
in organised financial markets is determined by reference to quoted
market prices at the close of business on the Statement of
financial position date. For financial instruments where there is
no active market, fair value is determined using valuation
techniques. Such techniques may include using recent arm's length
market transactions; reference to the current fair value of another
instrument that is substantially the same; discounted cash flow
analysis or other valuation models.
l) Property, plant and equipment
Property, plant and equipment are stated at historical cost,
less accumulated depreciation and any impairment in value.
Historical cost includes expenditure that is directly attributable
to property plant & equipment such as employee cost, borrowing
costs for long-term construction projects etc, if recognition
criteria are met. Likewise, when a major inspection is performed,
its costs are recognised in the carrying amount of the plant and
equipment as a replacement if the recognition criteria are
satisfied. All other repairs and maintenance costs are recognised
in the profit or loss as incurred.
Land is not depreciated. Depreciation on all other assets is
computed on straight-line basis over the useful life of the asset
based on management's estimate as follows:
Nature of asset Useful life (years)
----------------- --------------------
Buildings 40
Power stations 40
Other plant and
equipment 3-10
Vehicles 5-11
----------------- --------------------
Assets in the course of construction are stated at cost and not
depreciated until commissioned.
An item of property, plant and equipment is derecognised upon
disposal or when no future economic benefits are expected from its
use or disposal. Any gain or loss arising on derecognition of the
asset (calculated as the difference between the net disposal
proceeds and the carrying amount of the asset) is included in the
profit or loss in the year the asset is derecognised.
The assets residual values, useful lives and methods of
depreciation of the assets are reviewed at each financial year end
and adjusted prospectively if appropriate.
m) Intangible assets
Acquired software
Acquired computer software licences are capitalised on the basis
of the costs incurred to acquire and install the specific
software.
Subsequent measurement
All intangible assets, including software are accounted for
using the cost model whereby capitalised costs are amortised on a
straight-line basis over their estimated useful lives, as these
assets are considered finite. Residual values and useful lives are
reviewed at each reporting date. The useful life of software is
estimated as 4 years.
n) Leases
All leases are accounted for by recognising a right-of-use asset
and a lease liability except for:
-- Leases of low value assets; and
-- Leases with a duration of 12 months or less.
Lease liabilities are measured at the present value of the
contractual payments due to the lessor over the lease term, with
the discount rate determined by reference to the rate inherent in
the lease unless (as is typically the case) this is not readily
determinable, in which case the group's incremental borrowing rate
on commencement of the lease is used. Variable lease payments are
only included in the measurement of the lease liability if they
depend on an index or rate. In such cases, the initial measurement
of the lease liability assumes the variable element will remain
unchanged throughout the lease term. Other variable lease payments
are expensed in the period to which they relate. On initial
recognition, the carrying value of the lease liability also
includes:
-- amounts expected to be payable under any residual value
guarantee;
-- the exercise price of any purchase option granted in favour
of the group if it is reasonable certain to assess that option;
-- any penalties payable for terminating the lease, if the term
of the lease has been estimated in the basis of termination option
being exercised.
Right of use assets are initially measured at the amount of the
lease liability, reduced for any lease incentives received, and
increased for:
-- lease payments made at or before commencement of the
lease;
-- initial direct costs incurred; and
-- the amount of any provision recognised where the group is
contractually required to dismantle, remove or restore the leased
asset (typically leasehold dilapidations).
Subsequent to initial measurement lease liabilities increase as
a result of interest charged at a constant rate on the balance
outstanding and are reduced for lease payments made. Right-of-use
assets are amortised on a straight-line basis over the remaining
term of the lease or over the remain in economic life of the asset
if, rarely, this is judged to be shorter than the lease term. When
the group revises its estimate of the term of any lease (because,
for example, it re-assesses the probability of a lessee extension
or termination option being exercised), it adjusts the carrying
amount of the lease liability to reflect the payments to make over
the revised term, which are discounted using a revised discount
rate. The carrying value of lease liabilities is similarly revised
when the variable element of future lease payments dependent on a
rate or index is revised, except the discount rate remains
unchanged. In both cases an equivalent adjustment is made to the
carrying value of the right-of-use asset, with the revised carrying
amount being amortised over the remaining (revised) lease term. If
the carrying amount of the right-of-use asset is adjusted to zero,
any further reduction is recognised in profit or loss.
o) Borrowing costs
Borrowing costs directly attributable to the acquisition,
construction or production of qualifying assets, that necessarily
take a substantial period of time to get ready for their intended
use or sale, are added to the cost of those assets. Interest income
earned on the temporary investment of specific borrowing pending
its expenditure on qualifying assets is deducted from the costs of
these assets.
Gains and losses on extinguishment of liability, including those
arising from substantial modification from terms of loans are not
treated as borrowing costs and are charged to profit or loss.
All other borrowing costs including transaction costs are
recognized in the statement of profit or loss in the period in
which they are incurred, the amount being determined using the
effective interest rate method.
p) Impairment of non-financial assets
The Group assesses at each reporting date whether there is an
indication that an asset may be impaired. If any such indication
exists, or when annual impairment testing for an asset is required,
the Group estimates the asset's recoverable amount. An asset's
recoverable amount is the higher of an asset's or cash-generating
unit's (CGU) fair value less costs to sell and its value in use and
is determined for an individual asset, unless the asset does not
generate cash inflows that are largely independent of those from
other assets or Groups of assets. Where the carrying amount of an
asset or CGU exceeds its recoverable amount, the asset is
considered impaired and is written down to its recoverable amount.
In assessing value in use, the estimated future cash flows are
discounted to their present value using a pre-tax discount rate
that reflects current market assessments of the time value of money
and the risks specific to the asset. In determining fair value less
costs to sell, an appropriate valuation model is used. These
calculations are corroborated by valuation multiples, quoted share
prices for publicly traded subsidiaries or other available fair
value indicators.
For assets excluding goodwill, an assessment is made at each
reporting date as to whether there is any indication that
previously recognised impairment losses may no longer exist or may
have decreased. If such indication exists, the Group estimates the
asset's or cash-generating unit's recoverable amount. A previously
recognised impairment loss is reversed only if there has been a
change in the assumptions used to determine the asset's recoverable
amount since the last impairment loss was recognised. The reversal
is limited so that the carrying amount of the asset does not exceed
its recoverable amount, nor exceed the carrying amount that would
have been determined, net of depreciation, had no impairment loss
been recognised for the asset in prior years. Such reversal is
recognised in the profit or loss.
q) Non-current Assets Held for Sale and Discontinued
Operations
Non-current assets and any corresponding liabilities held for
sale and any directly attributable liabilities are recognized
separately from other assets and liabilities in the balance sheet
in the line items "Assets held for sale" and "Liabilities
associated with assets held for sale" if they can be disposed of in
their current condition and if there is sufficient probability of
their disposal actually taking place. Discontinued operations are
components of an entity that are either held for sale or have
already been sold and can be clearly distinguished from other
corporate operations, both operationally and for financial
reporting purposes. Additionally, the component classified as a
discontinued operation must represent a major business line or a
specific geographic business segment of the Group. Non-current
assets that are held for sale either individually or collectively
as part of a disposal group, or that belong to a discontinued
operation, are no longer depreciated. They are instead accounted
for at the lower of the carrying amount and the fair value less any
remaining costs to sell. If this value is less than the carrying
amount, an impairment loss is recognized. The income and losses
resulting from the measurement of components held for sale as well
as the gains and losses arising from the disposal of discontinued
operations, are reported separately on the face of the income
statement under income/loss from discontinued operations, net, as
is the income from the ordinary operating activities of these
divisions. Prior-year income statement figures are adjusted
accordingly. However, there is no reclassification of prior-year
balance sheet line items attributable to discontinued
operations.
r) Cash and cash equivalents
Cash and cash equivalents in the Statement of financial position
includes cash in hand and at bank and short-term deposits with
original maturity period of 3 months or less.
For the purpose of the consolidated cash flow statement, cash
and cash equivalents consist of cash in hand and at bank and
short-term deposits. Restricted cash represents deposits which are
subject to a fixed charge and held as security for specific
borrowings and are not included in cash and cash equivalents.
s) Inventories
Inventories are stated at the lower of cost and net realisable
value. Costs incurred in bringing each product to its present
location and condition is accounted based on weighted average
price. Net realisable value is the estimated selling price in the
ordinary course of business, less estimated selling expenses.
t) Earnings per share
The earnings considered in ascertaining the Group's earnings per
share (EPS) comprise the net profit for the year attributable to
ordinary equity holders of the parent. The number of shares used
for computing the basic EPS is the weighted average number of
shares outstanding during the year. For the purpose of calculating
diluted earnings per share the net profit or loss for the period
attributable to equity shareholders and the weighted average number
of shares outstanding during the period are adjusted for the
effects of all dilutive potential equity share.
u) Other provisions and contingent liabilities
Provisions are recognised when present obligations as a result
of a past event will probably lead to an outflow of economic
resources from the Group and amounts can be estimated reliably.
Timing or amount of the outflow may still be uncertain. A present
obligation arises from the presence of a legal or constructive
obligation that has resulted from past events. Restructuring
provisions are recognised only if a detailed formal plan for the
restructuring has been developed and implemented, or management has
at least announced the plan's main features to those affected by
it. Provisions are not recognised for future operating losses.
Provisions are measured at the estimated expenditure required to
settle the present obligation, based on the most reliable evidence
available at the reporting date, including the risks and
uncertainties associated with the present obligation. Where there
are a number of similar obligations, the likelihood that an outflow
will be required in settlement is determined by considering the
class of obligations as a whole. Provisions are discounted to their
present values, where the time value of money is material.
Any reimbursement that the Group can be virtually certain to
collect from a third party with respect to the obligation is
recognised as a separate asset. However, this asset may not exceed
the amount of the related provision. All provisions are reviewed at
each reporting date and adjusted to reflect the current best
estimate.
In those cases where the possible outflow of economic resources
as a result of present obligations is considered improbable or
remote, no liability is recognised, unless it was assumed in the
course of a business combination. In a business combination,
contingent liabilities are recognised on the acquisition date when
there is a present obligation that arises from past events and the
fair value can be measured reliably, even if the outflow of
economic resources is not probable. They are subsequently measured
at the higher amount of a comparable provision as described above
and the amount recognised on the acquisition date, less any
amortisation.
v) Share based payments
The Group operates equity-settled share-based remuneration plans
for its employees. None of the Group's plans feature any options
for a cash settlement.
All goods and services received in exchange for the grant of any
share-based payment are measured at their fair values. Where
employees are rewarded using share-based payments, the fair values
of employees' services is determined indirectly by reference to the
fair value of the equity instruments granted. This fair value is
appraised at the grant date and excludes the impact of non-market
vesting conditions (for example profitability and sales growth
targets and performance conditions).
All share-based remuneration is ultimately recognised as an
expense in profit or loss with a corresponding credit to 'Other
Reserves'.
If vesting periods or other vesting conditions apply, the
expense is allocated over the vesting period, based on the best
available estimate of the number of share options expected to vest.
Non-market vesting conditions are included in assumptions about the
number of options that are expected to become exercisable.
Estimates are subsequently revised if there is any indication that
the number of share options expected to vest differs from previous
estimates. Any cumulative adjustment prior to vesting is recognised
in the current period. No adjustment is made to any expense
recognised in prior periods if share options ultimately exercised
are different to that estimated on vesting.
Upon exercise of share options, the proceeds received net of any
directly attributable transaction costs up to the nominal value of
the shares issued are allocated to share capital with any excess
being recorded as share premium.
w) Employee benefits
Gratuity
In accordance with applicable Indian laws, the Group provides
for gratuity, a defined benefit retirement plan ("the Gratuity
Plan") covering eligible employees. The Gratuity Plan provides a
lump-sum payment to vested employees at retirement, death,
incapacitation or termination of employment, of an amount based on
the respective employee's salary and the tenure of employment.
Liabilities with regard to the gratuity plan are determined by
actuarial valuation, performed by an independent actuary, at each
Statement of financial position date using the projected unit
credit method.
The Group recognises the net obligation of a defined benefit
plan in its statement of financial position as an asset or
liability, respectively in accordance with IAS 19, Employee
benefits. The discount rate is based on the Government securities
yield. Actuarial gains and losses arising from experience
adjustments and changes in actuarial assumptions are charged or
credited to profit or loss in the statement of comprehensive income
in the period in which they arise.
x) Business combinations
Business combinations arising from transfers of interests in
entities that are under the control of the shareholder that
controls the Group are accounted for as if the acquisition had
occurred at the beginning of the earliest comparative period
presented or, if later, at the date that common control was
established using pooling of interest method. The assets and
liabilities acquired are recognised at the carrying amounts
recognised previously in the Group controlling shareholder's
consolidated financial statements. The components of equity of the
acquired entities are added to the same components within Group
equity. Any excess consideration paid is directly recognised in
equity.
y) Segment reporting
The Group has adopted the "management approach" in identifying
the operating segments as outlined in IFRS 8 - Operating segments.
Segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision maker. The Board
of Directors being the chief operating decision maker evaluate the
Group's performance and allocates resources based on an analysis of
various performance indicators at operating segment level. During
the year 2021 the Group has deconsolidated solar entities and are
classified as associates (note 7). Accordingly, there is only only
one operating segment thermal power. The solar power business is
classified as held for sale. There are no geographical segments as
all revenues arise from India. All the non current assets are
located in India.
6. Significant accounting judgements, estimates and
assumptions
The preparation of financial statements in conformity with IFRS
requires management to make certain critical accounting estimates
and assumptions that affect the reported amounts of assets and
liabilities and the disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period.
The principal accounting policies adopted by the Group in the
consolidated financial statements are as set out above. The
application of a number of these policies requires the Group to use
a variety of estimation techniques and apply judgment to best
reflect the substance of underlying transactions.
The Group has determined that a number of its accounting
policies can be considered significant, in terms of the management
judgment that has been required to determine the various
assumptions underpinning their application in the consolidated
financial statements presented which, under different conditions,
could lead to material differences in these statements. The actual
results may differ from the judgments, estimates and assumptions
made by the management and will seldom equal the estimated
results.
a) Judgements
The following are significant management judgments in applying
the accounting policies of the Group that have the most significant
effect on the financial statements.
Assessing control of subsidiaries, associates, joint
ventures
During FY21, the Group has reclassified the 31% equity interest
in the solar entities from Subsidiaries to Associates due to loss
of control. The interest in the solar entities (Avanti Solar Energy
Private Limited, Mayfair Renewable Energy (I) Private Limited,
Avanti Renewable Energy Private Limited and Brics Renewable Energy
Private Limited) are disclosed as assets held for sale.
Contractual payments under power supply agreement
The Group has received GBP4,181,162 during the period on account
of change in law as per terms of power supply agreement. The amount
received is grouped under other current liabilities relates to
period 2014-2020 and shall be recognised as revenue on approval
from regulatory authority.
Non-current assets held for sale and discontinued operations
"The Group exercises judgement in whether assets are held for
sale. After evaluation of all options, the Company decided that the
most efficient way to maximise shareholders' value from solar
operations is to dispose of the solar companies and it initiated
the process of disposition of the solar companies. Under IFRS 5,
such a transaction meets the 'Asset held for sale' when the
transaction is considered sufficiently probable and other relevant
criteria are met. Management consider that all the conditions under
IFRS 5 for classification of the solar business as held for sale
have been met as at 30 September 2021 and expects the interest in
the solar companies to be sold within the next 12 months.
Recoverability of deferred tax assets
The recognition of deferred tax assets requires assessment of
future taxable profit (see note 5(h)).
b) Estimates and uncertainties
The key assumptions concerning the future and other key sources
of estimation uncertainty at the Statement of financial position
date, that have a significant risk of causing material adjustments
to the carrying amounts of assets and liabilities within the next
financial year are discussed below:
i) Estimation of fair value of financial assets and financial
liabilities: While preparing the financial statements the Group
makes estimates and assumptions that affect the reported amount of
financial assets and financial liabilities.
Trade Receivables
The group ascertains the expected credit losses (ECL) for all
receivables and adequate impairment provision are made. At the end
of each reporting period a review of the allowance for impairment
of trade receivables is performed. Trade receivables do not contain
a significant financing element, and therefore expected credit
losses are measured using the simplified approach permitted by IFRS
9, which requires lifetime expected credit losses to be recognised
on initial recognition. A provision matrix is utilised to estimate
the lifetime expected credit losses based on the age, status and
risk of each class of receivable, which is periodically updated to
include changes to both forward-looking and historical inputs.
Financial assets measured at FVPL
Management applies valuation techniques to determine the fair
value of financial assets measured at FVPL where active market
quotes are not available. This requires management to develop
estimates and assumptions based on market inputs, using observable
data that market participants would use in pricing the asset. Where
such data is not observable, management uses its best estimate.
Estimated fair values of the asset may vary from the actual prices
that would be achieved in an arm's length transaction at the
reporting date.
ii) Impairment tests: In assessing impairment, management
estimates the recoverable amount of each asset or cash-generating
units based on expected future cash flows and use an interest rate
for discounting them. Estimation uncertainty relates to assumptions
about future operating results including fuel prices, foreign
currency exchange rates etc. and the determination of a suitable
discount rate;
iii) Useful life of depreciable assets: Management reviews its
estimate of the useful lives of depreciable assets at each
reporting date, based on the expected utility of the assets.
7. Profit/(Loss) from discontinued operations
Non-current assets held for sale and Profit/(Loss) from
discontinued operations consists of:
Assets Held for Sale Liabilities classified Profit from discontinued
as held for sale operations
At 30 At 30 At 31 At 30 At At At 30 At 30 At 31
March Sept. 30 31 Sept. Sept. March
2021 2021 Sept. March 2021 2020 2021
2020 2021
Sept. Sept.
2021 2020
------------------- -------- -------- ------- --------- -------- --------
i Interest in
Solar entities 16,638,171 14,720,769 16,425,368 - - - - - -
----------- ----------- ----------- -------- -------- ------- --------- -------- --------
ii Share of
Profit from
Solar entities - - - - - - - 117,711
----------- ----------- ----------- -------- -------- ------- --------- -------- --------
iii Gain on
deconsolidation
of Solar entities - - - - - 212,803 881,687 881,687
----------- ----------- ----------- -------- -------- ------- --------- -------- --------
Total 16,638,171 14,720,769 16,425,368 - - - 212,803 881,687 999,398
------------------- ----------- ----------- -------- -------- ------- --------- -------- --------
Assets held for sale and discontinued operations of solar
entities
During FY19, the results of the operations of solar entities
Avanti Solar Energy Private Limited, Mayfair Renewable Energy
Private Limited, Avanti Renewable Energy Private Limited and Brics
Renewable Energy Private Limited were classified as Assets held for
sale. After evaluation of all the options, the Company decided that
the most efficient way to maximise shareholders' value from the
solar operations is to dispose of the solar entities and the
process of disposition of the solar entities was initiated. The
process of sale could not be implemented during FY21 and six months
ended 30 September 2021 due to pandemic Covid-19 and expectation of
comparatively better valuation for sale. However the Management
expects the interest in the solar entities to be sold within the
next 12 months and continues to locate a buyer.
During FY19, the Company obtained a right to exercise an option
to buy additional 30% equity interest in solar companies. Effective
from FY2021 this right was re-assigned to a third party along with
the related obligations and the results of the operations of solar
companies Aavanti Solar Energy Private Limited, Mayfair Renewable
Energy (I) Private Limited, Aavanti Renewable Energy Private
Limited and Brics Renewable Energy Private Limited are not
consolidated in Group's consolidated financial statements due to
loss of control. The Group continues owning a 31% equity interest
in these solar associates.
Non-current Assets held-for-sale and discontinued operations
(a) Assets of disposal group classified As at As at As at
as held-for-sale 30 Sept. 30 Sept. 31 March
2021 2020 2021
Investment in associates classified as
held for sale 16,638,171 14,720,769 16,425,368
----------- ----------- -----------
Total 16,638,171 14,720,769 16,425,368
---------------------------------------------- ----------- ----------- -----------
(b) Liabilities of disposal group classified As at As at As at
as held-for-sale 30 Sept. 30 Sept. 31 March
2021 2020 2021
Liabilities of disposal group classified
as held-for-sale - - -
---------------------------------------------- ----------- ----------- -----------
Total - - -
---------------------------------------------- ----------- ----------- -----------
(c) Analysis of the results of discontinued Six months Six months
operations is as follows: ended ended
30 Sept. 30 Sept.
2021 2020 FY21
Share of Profit from Solar entities 212,803 - 117,711
Gain on deconsolidation of Solar entities - 881,687 881,687
----------- ----------- -----------
Profit / (Loss) from Solar operations 212,803 881,687 999,398
----------- ----------- -----------
8. Segment reporting
The Group has adopted the "management approach" in identifying
the operating segments as outlined in IFRS 8 -Operating segments.
Segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision maker. The Board
of Directors being the chief operating decision maker evaluate the
Group's performance and allocates resources based on an analysis of
various performance indicators at operating segment level. During
the FY21 the Group has deconsolidated solar entities and are
classified as associates (note 7). Accordingly, during FY 21 there
is only one operating segment thermal power. The solar power
business is classified as held for sale. There are no geographical
segments as all revenues arise from India. All the non current
assets are located in India.
Revenue on account of sale of power to one customer exceeding
10% of total sales revenue amounts to GBP5,883,758 (2021:
GBP28,720,575).
Segmental information disclosure
Continuing operations Discontinued operations
---------------------------------------- -------------------------------------
Thermal Solar
---------------------------------------- -------------------------------------
Segment Revenue Six months Six months Six months Six months
ended ended ended ended
30 Sept. 30 Sept. 30 Sept. 30 Sept.
2021 2020 FY 21 2021 2020 FY 21
Sales 55,603,742 36,089,887 93,823,933 - - -
Total 55,603,742 36,089,887 93,823,933 - - -
------------ ------------ ------------ ----------- ----------- -----------
Other Operating income - 9,628,703 9,420,712 - -
Depreciation, impairment (2,800,143) (2,983,195) (5,705,538) - - -
- - -
Profit from operation 8,689,814 16,158,820 27,495,324 - - -
Finance Income 1,367,175 284,328 868,439 - - -
Finance Cost (2,675,395) (3,681,194) (6,803,137) - - -
Tax expenses (3,390,062) (1,865,120) (8,447,699) - - -
Gain on deconsolidation
of Solar entities - - - - 881,687 881,687
Share of Profit in
Solar entities - - - 212,803 - 117,711
Profit for the year
/ Period 3,991,532 10,896,834 13,112,927 212,803 881,687 999,398
------------ ------------ ------------ ----------- ----------- -----------
Assets 257,857,161 241,320,200 239,076,536 16,425,368 16,638,171 16,425,368
Liabilities 107,040,996 87,807,725 93,934,834 - - -
9. Costs of inventories and employee benefit expenses included
in the consolidated statements of comprehensive income
Cost of fuel
Six months Six months
ended ended
30 Sept. 30 Sept.
2021 2020 FY21
------------------------------------------------ ------------ ------------ -----------
Included in cost of revenue:
Cost of fuel consumed 38,721,460 20,965,590 54,095,390
Other direct costs 2,347,105 1,168,785 2,797,675
Total 41,068,565 22,134,375 56,893,065
------------------------------------------------ ------------ ------------ -----------
-
Employee benefit expenses forming part of general
and administrative expenses are as follows:
Six months Six months
ended ended
30 Sept. 30 Sept.
2021 2020 FY21
------------------------------------------------ ------------ ------------ -----------
Salaries and wages 1,037,241 960,822 2,139,303
Employee benefit costs 96,035 70,241 228,112
Long Tern Incentive Plan 97,389 267,624 535,247
Total 1,230,665 1,298,686 2,902,662
------------------------------------------------ ------------ ------------ -----------
Foreign exchange movements (realised and unrealised) included in the
Finance costs is as follows:
Six months Six months
ended ended
30 Sept. 30 Sept.
2021 2020 FY21
------------------------------------------------ ------------ ------------ -----------
Foreign exchange realised loss / (gain) 202,607 (68,866) 213,524
Foreign exchange unrealised- loss / (gain) 44,532 231,416 46,931
------------ ------------ -----------
Total 247,139 162,550 260,455
------------------------------------------------ ------------ ------------ -----------
10. Other operating income and expenses
Other operating income
Six months Six months
ended ended
30 Sept. 30 Sept.
2021 2020 FY21
------------------------------------------------ ------------ ------------ -----------
Contractual claims payments - 9,628,703 9,420,712
Total - 9,628,703 9,420,712
------------------------------------------------ ------------ ------------ -----------
Other operating income represents contractual claims payments from
company's customers under the power purchase agreements which were
accumulated over several periods.
Other income
Six months Six months
ended ended
30 Sept. 30 Sept.
2021 2020 FY21
------------------------------------------------ ------------ ------------ -----------
Sale of coal 749,197 208,437 616,708
Sale of fly ash 41,392 7,697 16,271
Power trading commission and other services 120,242 4,367 147,166
Others 329,300 285,062 1,141,401
-----------
Total 1,240,131 505,562 1,921,546
------------------------------------------------ ------------ ------------ -----------
11. Finance costs
Finance costs are comprised of:
Six months Six months
ended ended
30 Sept. 30 Sept.
2021 2020 FY21
------------------------------------------------ ------------ ------------ -----------
Interest expenses on borrowings 2,128,085 3,495,422 5,848,895
Net foreign exchange loss (Note 9) 126,565 162,550 260,455
Other finance costs 420,745 23,222 693,787
------------ ------------ -----------
Total 2,675,395 3,681,194 6,803,137
------------------------------------------------ ------------ ------------ -----------
Other finance costs include charges and cost related to LC's for import
of coal and other charges levied by bank on transactions
12. Finance income
Finance income is comprised of:
Six months Six months
ended ended
30 Sept. 30 Sept.
2021 2020 FY21
------------------------------------------------ ------------ ------------ -----------
Interest income on bank deposits and advances 302,883 284,328 401,194
Gain on disposal / fair value of financial
instruments* 1,064,293 - 467,245
-----------
Total 1,367,176 284,328 868,439
------------------------------------------------ ------------ ------------ -----------
*Financial instruments represent the mutual
funds held during the period.
13. Tax expenses
Six months Six months
ended ended
30 Sept. 30 Sept.
2021 2020 FY21
------------------------------------------------ ------------ ------------ -----------
Current tax 216,220 155 412,513
Deferred tax 3,173,842 1,864,965 8,035,186
Tax reported in the statement of comprehensive
income 3,390,062 1,865,120 8,447,699
------------------------------------------------ ------------ ------------ -----------
The Company is subject to Isle of Man corporate tax at the
standard rate of zero percent. As such, the Company's tax liability
is zero. Additionally, Isle of Man does not levy tax on capital
gains. However, considering that the group's operations are
primarily based in India, the effective tax rate of the Group has
been computed based on the current tax rates prevailing in India.
Further, a substantial portion of the profits of the Group's India
operations are exempt from Indian income taxes being profits
attributable to generation of power in India. Under the tax holiday
the taxpayer can utilize an exemption from income taxes for a
period of any ten consecutive years out of a total of fifteen
consecutive years from the date of commencement of the operations.
However, the entities in India are still liable for Minimum
Alternate Tax (MAT) which is calculated on the book profits of the
respective entities currently at a rate of 17.47% (31 March 2021:
17.47%).
14. Intangible assets
Acquired software licences
-------------------------------
Cost 30 Sept. 30 Sept. 31 March
2021 2020 2021
Opening 763,595 827,065 827,065
Additions - - -
Exchange adjustments 7,816 (14,610) (63,470)
--------- --------- ---------
Total 771,410 812,455 763,595
Accumulated depreciation and impairment
Opening 761,201 818,020 818,020
Charge for the year / Period 1,187 3,173 6,209
Exchange adjustments 7,817 (14,454) (63,028)
--------- --------- ---------
At 31 March 2021 770,205 806,739 761,201
Net book value 1,206 5,716 2,394
15. Property, plant and equipment
The property, plant and equipment comprises of:
Land & Other plant Asset under
Buildings Power stations & equipment Vehicles construction Total
----------- --------------- ------------- ------------ -------------- -------------
Cost
At 1 April 2020 8,765,490 216,622,367 1,886,252 2,356,081 280,776 229,910,967
Additions 271,158 318,038 24,375 134,659 36,206 784,436
Transfers on capitalisation 13,598 159,120 - - (172,718) -
Sale / Disposals - - - (1,561,762) - (1,561,762)
Exchange adjustments (661,265) (16,639,299) (143,908) (180,354) (21,547) (17,646,373)
At 31 March 2021 8,388,982 200,460,226 1,766,719 748,624 122,717 211,487,267
----------- --------------- ------------- ------------ -------------- -------------
At 1 April 2021 8,388,982 200,460,226 1,766,719 748,624 122,717 211,487,267
Additions - 62,898 10,853 1,588 83,634 158,973
Transfers on capitalisation - - - - - -
Sale / Disposals - - - - - -
Exchange adjustments 84,610 2,053,769 17,970 7,601 986 2,164,936
At 30 September 2021 8,473,592 202,576,893 1,795,541 757,813 207,337 213,811,176
----------- --------------- ------------- ------------ -------------- -------------
Accumulated depreciation
and impairment
At 1 April 2021 55,601 34,683,662 878,072 1,824,237 - 37,441,572
Charge for the year 12,081 5,230,238 262,333 194,677 - 5,699,329
Sale / Disposals - - - (1,263,537) - (1,263,537)
Exchange adjustments (6,363) (2,874,452) (77,955) (147,367) - (3,106,137)
At 31 March 2021 61,319 37,039,448 1,062,450 608,010 - 38,771,227
----------- --------------- ------------- ------------ -------------- -------------
At 1 April 2021 61,319 37,039,448 1,062,450 608,010 - 38,771,227
Charge for the period 6,351 2,648,699 128,242 15,664 - 2,798,956
Sale / Disposals - - - - - -
Exchange adjustments 979 410,311 13,632 6,493 - 431,415
At 30 September 2021 68,649 40,098,458 1,204,324 630,167 - 42,001,598
----------- --------------- ------------- ------------ -------------- -------------
Net book value
At 30 September 2021 8,404,943 162,478,435 591,218 127,646 207,337 171,809,578
At 31 March 2021 8,327,663 163,420,778 704,269 140,614 122,717 172,716,040
At 30 September 2020 8,648,100 176,122,741 901,135 351,466 389,484 186,412,926
16. Other assets
As at As at As at
30 Sept. 30 Sept. 31 March
2021 2020 2021
-------------------------------- ----------- ---------- -----------
A. Short-term
Capital advances 105,907 112,070 124,601
Financial instruments measured
at fair value through P&L 24,125,311 1,480,545 13,253,663
Advances and other receivables 7,794,800 5,245,168 4,427,290
Total 32,026,018 6,837,783 17,805,554
----------- ---------- -----------
B. Long-term
Lease deposits - 389,022 -
Bank deposits 71,168 - 57,713
Other advances 12,140 16,512 12,140
-----------
Total 83,308 405,534 69,853
-------------------------------- ----------- ---------- -----------
The financial instruments of GBP24,125,311 (2021: GBP13,253,663)
represent investments in mutual funds and their fair value is
determined by reference to published data.
17. Trade and other receivables
As at As at As at
30 Sept. 30 Sept. 31 March
2021 2020 2021
---------------------------------- ------------ ------------ -----------
Current
Trade receivables 17,329,073 24,238,726 14,829,989
17,329,073 24,238,726 14,829,989
---------------------------------- ------------ ------------ -----------
18. Inventories
As at As at As at
30 Sept. 30 Sept. 31 March
2021 2020 2021
---------------------------------- ------------ ------------ -----------
Coal and fuel 12,230,429 6,790,041 11,228,377
Stores and spares 1,403,758 1,076,374 958,267
-----------
Total 13,634,187 7,866,415 12,186,644
---------------------------------- ------------ ------------ -----------
The entire amount of above inventories has been pledged as security
for borrowings
19. Cash and cash equivalents and Restricted cash
a) Cash and short term deposits comprise
of the following:
As at As at As at
30 Sept. 30 Sept. 31 March
2021 2020 2021
---------------------------------- ------------ ------------ -----------
Investment in Mutual funds 1,834,212 - 1,815,629
Cash at banks and on hand 7,606,168 9,374,849 7,105,323
Total 9,440,379 9,374,849 8,920,952
---------------------------------- ------------ ------------ -----------
Short-term deposits are placed for varying periods, depending on
the immediate cash requirements of the Group. They are recoverable
on demand.
b) Restricted cash
Current restricted cash represents deposits maturing between
three to twelve months amounting to GBP3,122,794 (2021:
GBP3,219,356) which have been pledged by the Group in order to
secure borrowing limits with the banks.
Non-current restricted represents investments in mutual funds
maturing after twelve months amounting to GBP9,262,942 (2021:
GBP8,194,412). Investments of GBP 8,266,192 (2021: GBP8,182,445)
are allocated to debenture redemption fund earmarked towards
redemption of non-convertible debentures scheduled during FY2024 of
GBP20,043,153.
20. Issued share capital
Share Capital
The Company presently has only one class of ordinary shares. For
all matters submitted to vote in the shareholders meeting, every
holder of ordinary shares, as reflected in the records of the Group
on the date of the shareholders' meeting, has one vote in respect
of each share held. All shares are equally eligible to receive
dividends and the repayment of capital in the event of liquidation
of the Group.
As at 30 September 2021, the Company has an authorised and
issued share capital of 400,733,511 (31 March 2021: 400,733,511)
equity shares at par value of GBP 0.000147 (31 March 2021: GBP
0.000147) per share amounting to GBP58,909 (31 March 2021:
GBP58,909) in total.
Reserves
Share premium represents the amount received by the Group over
and above the par value of shares issued. Any transaction costs
associated with the issuing of shares are deducted from share
premium, net of any related income tax benefits.
Foreign currency translation reserve is used to record the
exchange differences arising from the translation of the financial
statements of the foreign subsidiaries.
Other reserve represents the difference between the
consideration paid and the adjustment to net assets on change of
controlling interest, without change in control, other reserves
also includes any costs related with share options granted and
gain/losses on re-measurement of financial assets measured at fair
value through other comprehensive income.
Retained earnings include all current and prior period results
as disclosed in the consolidated statement of comprehensive income
less dividend distribution.
21. Share based payments
Long Term Incentive Plan
In April 2019, the Board of Directors has approved the
introduction of Long Term Incentive Plan (""LTIP""). The key terms
of the LTIP are:
The number of performance-related awards is 14 million ordinary
shares (the "LTIP Shares") (representing approximately 3.6 per cent
of the Company's issued share capital). The grant date is 24 April
2019.
The LTIP Shares were awarded to certain members of the senior
management team as Nominal Cost Shares and will vest in three
tranches subject to continued service with Group until vesting and
meeting the following share price performance targets, plant load
factor ("PLF") and term loan repayments of the Chennai thermal
plant.
- 20% of the LTIP Shares shall vest upon meeting the target
share price of 25.16p before the first anniversary for the first
tranche, i.e. 24 April 2020, achievement of PLF during the period
April 2019 to March 2020 of at least 70% at the Chennai thermal
plant and repayment of all scheduled term loans;
- 40% of the LTIP Shares shall vest upon meeting the target
share price of 30.07p before the second anniversary for the second
tranche, i.e. 24 April 2021, achievement of PLF during the period
April 2020 to March 2021 of at least 70% at the Chennai thermal
plant and repayment of all scheduled term loans;
- 40% of the LTIP Shares shall vest upon meeting the target
share price of 35.00p before the third anniversary for the third
tranche, i.e. 24 April 2022, achievement of PLF of at least 70% at
the Chennai thermal plant during the period April 2021 to March
2022 and repayment of all scheduled term loans.
The nominal cost of performance share, i.e. upon the exercise of
awards, individuals will be required to pay up 0.0147p per share to
exercise their awards
The share price performance metric will be deemed achieved if
the average share price over a fifteen day period exceeds the
applicable target price. In the event that the share price or other
performance targets do not meet the applicable target, the number
of vesting shares would be reduced pro-rata, for that particular
year. However, no LTIP Shares will vest if actual performance is
less than 80 per cent of any of the performance targets in any
particular year. The terms of the LTIP provide that the Company may
elect to pay a cash award of an equivalent value of the vesting
LTIP Shares.
In April 2020, and upon meeting relevant performance targets,
2,190,519 LTIP shares vested (80% of the 1st tranche). These shares
will be issued later this year.
None of the LTIP Shares, once vested, can be sold until the
third anniversary of the award, unless required to meet personal
taxation obligations in relation to the LTIP award.
For LTIP Shares awards, GBP97,389 (FY20: GBP535,247) has been
recognised in general and administrative expenses.
Grant date 24-Apr-19 24-Apr-19 24-Apr-19
Vesting date 24-Apr-20 24-Apr-21 24-Apr-22
Method of Settlement Equity/ Equity/ Equity/
Cash Cash Cash
Vesting of shares (%) 20% 40% 40%
Number of LTIP Shares granted 2,800,000 5,600,000 5,600,000
Exercise Price (pence per share) 0.0147 0.0147 0.0147
Fair Value of LTIP Shares granted
(pence per share) 0.1075 0.1217 0.1045
Expected Volatility (%) 68.00% 64.18% 55.97%
22. Borrowings
The borrowings comprise of the following:
Interest Final 30 Sept. 30 Sept. 31 March
rate (range maturity 2021 2020 2021
%)
------------------------------ ------------- ---------- ----------- ----------- -----------
Borrowings at amortised cost 10.35-11.40 June 2024 27,768,344 23,171,284 26,770,564
Non-Convertible Debentures
at amortised cost 9.85 June 2023 20,043,153 21,110,407 19,840,089
Total 47,811,497 44,281,691 46,610,653
------------------------------ ------------- ---------- ----------- ----------- -----------
The term loans of GBP23.8m, non-convertible debentures of
GBP20.0m and working capital loans of GBP4.0m taken by the Group
are fully secured by the property, plant, assets under construction
and other current assets of subsidiaries which have availed such
loans. All term loans and working capital loans are personally
guaranteed by a director.
Term loans contain certain covenants stipulated by the facility
providers and primarily require the Group to maintain specified
levels of certain financial metrics and operating results. As of 30
September 2021, the Group has met all the relevant covenants. The
Group raised approximately GBP20.0 million ( 2000 million) during
June 2020 through non-convertible debentures (NCDs) issue with a
three years term and coupon rate of 9.85%. NCD's proceeds was used
to repay the FY21 and FY22 (i.e. to March 2022) principal term
loans obligations.
The fair value of borrowings at 30 September 2021 was
GBP47,811,497 (2021: GBP46,610,653, 30 September 2020 44,281,691).
The fair values have been calculated by discounting cash flows at
prevailing interest rates.
The borrowings are reconciled to the statement of financial
position as follows:
30 Sept. 30 Sept. 31 March
2021 2020 2021
----------------------------------------------- ----------- ----------- -----------
Current liabilities
Amounts falling due within one year 9,830,045 1,430,290 4,510,358
Non-current liabilities
Amounts falling due after 1 year but not more
than 5 years 37,981,452 42,851,401 42,100,295
Total 47,811,497 44,281,691 46,610,653
----------------------------------------------- ----------- ----------- -----------
-ends-
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December 08, 2021 02:00 ET (07:00 GMT)
Opg Power Ventures (AQSE:OPG.GB)
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