TIDMLIV
RNS Number : 5103M
Livermore Investments Group Limited
17 September 2019
16 September, 2019
LIVERMORE INVESTMENTS GROUP LIMITED
UNAUDITED INTERIM RESULTS FOR SIX MONTHSED 30 JUNE 2019
Livermore Investments Group Limited (the "Company" or
"Livermore") today announces its interim results for the six months
ended 30 June 2019.
For further investor information please go to
www.livermore-inv.com.
Enquiries:
Livermore Investments Group Limited +41 43 344 3200
Arden Partners plc +44 (0)20 7614 5900
Tom Price
Chairman's and Chief Executive's Review
Introduction
We are pleased to announce the interim financial results for
Livermore Investments Group Limited (the "Company" or "Livermore")
for the six months ended 30 June 2019. References to the Company
hereinafter also include its consolidated subsidiaries (note
9).
During the first half of 2019, the Company generated net income
of USD 9.10m (30 June 2018: USD 6.35m), which represents earnings
per share of USD 0.05 (30 June 2018: USD 0.03). The NAV of the
Company stood at USD 183.0m as of end of June 2019, representing a
USD 8.66m or 5.0% gain from the beginning of the year. The gains
relate largely to the CLO and loan warehousing portfolio, which
contributed over USD 11m. These gains were somewhat offset by
administrations costs of about USD 3.5m. Management continued to
actively manage the financial portfolio and optimize exposure to US
credit markets. During the period, management exited one warehouse
that generated carry of USD 1.39m and started a new warehouse. The
two open warehouses as at the end of the reporting period were
exited in August 2019 with net carry of USD 3.8m and USD 1.1m
respectively.
Financial Review
The NAV of the Company as at 30 June 2019 was USD 183.0m (30
June 2018: 175.6m). The profit after tax for the first half of 2019
was USD 9.10m, which represents earnings per share of USD 0.05. The
gain relates largely to the performance of the CLO portfolio and
exposure to leveraged loans.
30 June 2019 30 June 2018 31 December 2018
US $m US $m US $m
------------- ------------- -----------------
Shareholders' funds at beginning of period 174.3 175.4 157.4
------------- ------------- -----------------
___________ ___________ ___________
------------- ------------- -----------------
Income from investments 11.5 15.7 31.5
------------- ------------- -----------------
Realised losses on investments - - -
------------- ------------- -----------------
Unrealised profits/ (losses) on investments 0.5 (5.8) (15.6)
------------- ------------- -----------------
Administration costs (3.5) (1.6) (9.0)
------------- ------------- -----------------
Net finance income / (costs) 0.2 (0.1) -
------------- ------------- -----------------
Tax (charge) / credit - - -
------------- ------------- -----------------
___________ ___________ ___________
------------- ------------- -----------------
Increase in net assets from operations 8.7 8.2 6.9
------------- ------------- -----------------
Dividends paid - (8.0) (8.0)
------------- ------------- -----------------
___________ ___________ ___________
------------- ------------- -----------------
Shareholders' funds at end of period 183.0 175.6 174.3
------------- ------------- -----------------
------ ------ ------
------------- ------------- -----------------
Net Asset Value per share US $1.05 US $1.00 US $1.00
------------- ------------- -----------------
Livermore's Strategy
The Company's primary investment objective is to generate high
current income and regular cash flows. The financial portfolio is
constructed around fixed income instruments such as Collateralized
Loan Obligations ("CLOs") and other securities or instruments with
exposure primarily to senior secured and usually broadly syndicated
US loans. The Company has a long-term oriented investment
philosophy and invests primarily with a buy-and-hold mentality,
though from time to time the Company will sell investments to
realize gains or for risk management purposes.
Strong emphasis is given to maintaining sufficient liquidity and
low leverage at the overall portfolio level and to re-invest in
existing and new investments along the economic cycle.
Dividend & Buyback
The Board of Directors will decide on the Company's dividend
policy for 2019 based on profitability, liquidity requirements,
portfolio performance, market conditions, and the share price of
the Company relative to its NAV.
The company has no shares in treasury.
Richard Rosenberg Noam Lanir
Chairman Chief Executive
16 September 2019
Review of Activities
Economic & Investment Environment
The first half of 2019 was beset by increased geopolitical
noise, trade and tariff uncertainties, and concerns over slowing
global economic growth and the ability of central banks to
stimulate if hit by a deep slowdown. As the US continues to push to
renegotiate longstanding trade treaties and dealings with the rest
of the world, the tariffs imposed and resulting uncertainties are
slowing business investment down and its effect on the global
supply chain has not yet been fully understood. UK's disarray over
its orderly or disorderly exit from the European Union has further
dampened global trade and investment.
Although, GDP growth in the first quarter picked up worldwide
with all large economies recording above-average expansion,
manufacturing output again tended to weaken in many countries,
accompanied by subdued investment spending and a reduction in
global goods trade. At 3.1%, economic growth in the US was
considerably stronger in the first quarter than in the previous
period. However, this was primarily attributable to volatile
components such as inventories. Domestic final demand lost some
momentum with slower consumer spending and uncertainty in
connection with financial markets volatility. The Euro area also
recorded a higher growth rate in the first quarter with Germany
leading the way. However, here too momentum was lost with Germany
staring at a potential recession later this year.
Signals from the labour markets have remained positive overall.
Employment figures in the advanced economies rose again and
unemployment has continued to decline. The unemployment rate in the
US moved down from 3.9 percent in December to 3.6 percent in May;
meanwhile, wage gains remained moderate. The Euro area also saw the
unemployment rate decline and is now close to its lowest level
since its inception.
Inflation has generally remained muted in most advanced
economies. In the US, the personal consumption expenditures price
index moved down from over 2% to 1.5% in May. Core inflation also
fell, and was 1.6% in May - down from 2% a year ago. In the Euro
area, consumer price inflation was little changed in recent months,
with core inflation hovering around 1.0%.
To combat a potential slowdown in their respective economies,
central banks in the US and Euro area changed their monetary policy
stance to allow for additional accommodation. The US Federal
Reserve stopped its interest rate hikes and in July voted to reduce
the Fed funds rate by 0.25%. The European Central Bank (ECB) has
also indicated further easing.
Stock markets initially continued to move higher; however, trade
tensions prompted a correction in May. By mid-June, the MSCI World
Index was back near its mid-March level. Still, the drop in the
last quarter of 2018 was deep enough that the S&P 500 generated
over 17% return during the first half of this year. Yields on
ten-year government bonds in advanced economies declined for the
most part with the US 10 year yield dropping from about 2.7% to
2.0% by the end of the first half as investors ratcheted down
growth and rate expectations.
With expectations of slower economic growth in the US and a
resulting fall in rate expectations, demand for floating rate
assets such as US senior secured loans and CLOs waned and there
were substantial outflows from retail loan funds. According to
S&P Capital IQ, total institutional loan issuance was USD 147
billion in the first half of 2019 as compared to USD 271 billion
during the first half of 2018 as leveraged buyout (LBO) and
refinancing activity decreased. Loan spreads were wider as compared
to last year and offered good return characteristics to spread
buyers. Given the length of the credit cycle certain loan
fundamentals have deteriorated and the loan market exposure to
Single-B rated loans is at its highest level. Default rates,
however, have continued to stay well below historical levels. The
Company anticipates default rates to stay below historical average
levels as there are few near-term maturities and interest coverage
ratios remain healthy. For the six months ended June 30, 2019, the
Credit Suisse Leverage Loan Index ("CSLLI") generated a total
return of 5.42%.
Sources: Swiss National Bank (SNB), European Central Bank (ECB),
US Federal Reserve, Bloomberg, JP Morgan, S&P Capital IQ
Financial Portfolio and trading activity
The Company manages a financial portfolio valued at USD 169.7m
as at 30 June 2019, which is invested mainly in fixed income and
credit related securities.
The following is a table summarizing the financial portfolio as
at 30 June 2019
Name 30 June 2019 30 June 2018 31 December
Book Value Book Value 2018
US $m US $m Book Value
US $m
-------------------------------- -------------- ------------ -----------
Investment in the loan market
through CLOs 106.1 108.5 97.1
-------------------------------- -------------- ------------ -----------
Open Warehouse facilities 41.2 5.0 38.4
-------------------------------- -------------- ------------ -----------
Hedge Funds - 1.1 1.1
-------------------------------- -------------- ------------ -----------
Perpetual Bonds 1.1 1.1 1.1
-------------------------------- -------------- ------------ -----------
Other Public Equities 1.6 2.8 1.5
-------------------------------- -------------- ------------ -----------
Invested Total 150.0 118.5 139.2
-------------------------------- -------------- ------------ -----------
Cash 19.7 44.1 26.2
-------------------------------- -------------- ------------ -----------
Total 169.7 162.6 165.4
-------------------------------- -------------- ------------ -----------
Senior Secured Loans and CLOs:
The US senior secured loan market (leveraged loan market)
continued to offer good risk adjusted returns in the first half of
2019 with relatively lower volatility and low correlation to the
equity market. CLOs are managed portfolios invested into
diversified pools of senior secured loans and financed with long
term financing pre-fixed at the time of issuance.
After a steep fall in late 2018, US senior secured loans staged
a sharp comeback in January. The rally lost steam however, as
investors ratcheted down rate expectations and yields tumbled on
the back of slower growth expectations and increased trade
tensions. Outflows from retail funds were strong and persistent.
Nonetheless, the leveraged loan market performed well in the first
half of 2019 with the Credit Suisse Leveraged Loan Index recording
a total return of 5.42%. Credit conditions remained benign with
default rates lower than historical averages as there are few near
term maturities and interest coverage levels remain healthy.
The soft demand for floating rate paper was also apparent in the
CLO market in the first half of 2019 with debt spreads much wider
as compared to the same time period last year. This has made
refinancing or extending existing CLO reinvestment periods quite
difficult. Thankfully, the Company had refinanced or extended
several of its deals in 2017 and 2018 and none of the transactions
are in immediate need of an extension or refinancing. Wider new
issue spreads in the loan market and somewhat elevated loan price
volatility in the secondary loan market provided most CLO managers
opportunities to increase weighted average spreads, build par,
and/or reduce risk. The CLO equity market was relatively weak
during the first half of 2019 especially for those with short
reinvestment periods. CLO equity distributions were in line or
better than previous periods as weighted average spreads increased
in our CLO portfolio and the basis between 1 month and 3 month
Libor declined.
During the reporting period the Company's US CLO portfolio
performed well as cash flows were generally higher. The CLO
portfolio generated about USD 9.5m in cash distributions during the
period. The Company also had two warehouses open at the beginning
of the year. One of these warehouses was converted into a CLO and
generated about USD 1.4m in carry. Subsequently, management opened
another warehouse with the same CLO manager in May 2019. The two
warehouses open as at the end of the reporting period have been
successfully converted into CLOs in the third quarter and have
generated almost USD 5m in carry. For the period, the CLO and
warehouse portfolio generated net gains of about USD 11m. The
Company continues to look for opportunities to invest in the
first-loss tranche of warehouse facilities with long tenures and no
mark-to-market triggers. As of the end of the year 2018, all of the
Company's US CLO equity positions were passing their
overcollateralization (OC) tests and remained robust. Management
continues to actively monitor the CLO portfolio and position it
towards longer reinvestment periods through recycling old CLOs into
new or refinancing them with extended reinvestment periods, as well
as conducting relative value and opportunistic trading. Management
continues to focus on sectors such as Retail, Healthcare and
Technology that are expected to undergo shifts due to technology or
regulation. As at 30 June 2019, 100% of the Company's CLO portfolio
is invested in post-crisis US CLOs.
Although management maintains a positive view on the CLO
portfolio, mid-long term performance may be negatively impacted by
a strong pull back in the US or European economy or geo-political
events that could result in a spike in defaults. Despite the
overall decent health of the US economy, we acknowledge that the
continued trade tensions and below trend growth globally as well as
headwinds relating to the political turmoil and geopolitical shocks
pose risks to the CLO portfolio.
The Company's CLO portfolio is divided into the following
geographical areas:
30 June Percentage 30 June Percentage
2019 2018 Amount
Amount
US $000 US $000
US CLOs 106,134 100.0% 108,462 100.0%
------ ------ ------ ------
106,134 100% 108,462 100%
------ ------ ------ ------
Private Equity Funds
The other private equity investments held by the Company are
incorporated in the form of Managed Funds (mostly closed end funds)
mainly in emerging economies. The investments of these funds into
their portfolio companies were mostly done in 2008 and 2009.
Overall, the Company expects that exits of portfolio companies
should materialize by 2021.
The following summarizes the book value of the private equity
funds as at 30 June 2019:
Name Book Value
US $m
-------------------- ------------
Evolution Venture
(Israel) 3.7
-------------------- ------------
Other investments 2.8
-------------------- ------------
Total 6.5
-------------------- ------------
Evolution Venture:
Evolution is an Israel focused Venture Capital fund. It invests
in early stage technology companies. The fund has now exited its
investment in WhiteSmoke and written off the Wi-Fi solutions and
digital radio investments. Its main asset is its investment in the
virtualization technology company, which continues to perform
well.
The following table reconciles the review of activities to the
Group's financial assets as at 30 June 2019.
Name 30 June 2019
Book Value
US $m
------------------------------------- --------------
Financial portfolio 150.0
------------------------------------- --------------
Private Equity Funds 6.5
------------------------------------- --------------
Total 156.5
------------------------------------- --------------
Financial assets at fair
value through profit or
loss (note 5) 150.0
------------------------------------- --------------
Financial assets at fair
value through other comprehensive
income (note 6) 6.5
------------------------------------- --------------
Total 156.5
------------------------------------- --------------
Events after the reporting date
Both of the warehouse facilities that the Company invested in,
during 2019, with a carrying amount as at 30 June 2019 of USD
37.5m, were closed in August 2019, and Livermore's investment
amount plus net carry amounting to a total of USD 41.2m became
receivable in August 2019.
Litigation
Information is provided in note 24 to the interim condensed
consolidated financial statements.
Livermore Investments Group Limited
Condensed Consolidated Statement of Financial Position
as at 30 June 2019
30 June 30 June 31 December
2019 2018 2018
Note Unaudited Unaudited Audited
Assets US $000 US $000 US $000
Non-current assets
Property, plant and equipment 26 26 21
Right-of-use asset 2 370 - -
Financial assets at fair value through profit or loss 5 106,134 108,462 97,081
Financial assets at fair value through other
comprehensive income 6 6,518 7,571 6,387
Investments in subsidiaries 9 5,443 5,387 5,205
Trade and other receivables 10 - 2,579 -
-------- -------- --------
118,491 124,025 108,694
-------- -------- --------
Current assets
Trade and other receivables 10 6,333 3,184 3,168
Financial assets at fair value through profit or loss 5 43,905 8,931 41,067
Financial assets at fair value through other
comprehensive income 6 - 1,118 1,117
Cash at bank 11 19,689 44,125 26,214
-------- -------- --------
69,927 57,358 71,566
-------- -------- --------
Total assets 188,418 181,383 180,260
-------- -------- --------
Equity
Share capital 12 - - -
Share premium 169,187 169,187 169,187
Other reserves (20,198) (23,627) (20,279)
Retained earnings 34,008 30,085 25,425
-------- -------- --------
Total equity 182,997 175,645 174,333
-------- -------- --------
Liabilities
Non-current liabilities
Lease liability 2 288 - -
-------- -------- --------
288 - -
-------- -------- --------
Current liabilities
Bank overdrafts 11 18 180 -
Trade and other payables 14 5,033 5,556 5,927
Lease liability - current portion 2 82 - -
Current tax liability - 2 -
-------- -------- --------
5,133 5,738 5,927
-------- -------- --------
Total liabilities 5,421 5,738 5,927
-------- -------- --------
Total equity and liabilities 188,418 181,383 180,260
-------- -------- --------
Net asset valuation per share
Basic and diluted net asset valuation per share (US $) 15 1.05 1.00 1.00
-------- -------- --------
Livermore Investments Group Limited
Condensed Consolidated Statement of Profit or Loss
for the six months ended 30 June 2019
-----------------------------------------------------------------------------------------
Note Six months Six months Year
ended ended ended
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Investment Income
Interest and distribution income 17 11,512 15,706 31,541
Changes in value of investments 18 923 (7,667) (17,380)
------ ------ ------
12,435 8,039 14,161
Operating expenses 19 (3,513) (1,602) (8,973)
------ ------ ------
Operating profit 8,922 6,437 5,188
Finance costs 20 (10) (184) (245)
Finance income 20 201 106 233
------ ------ ------
Profit before taxation 9,113 6,359 5,176
Taxation charge (11) (9) (14)
------ ------ ------
Profit for period / year 9,102 6,350 5,162
------ ------ ------
Earnings per share
Basic and diluted earnings per share (US $) 22 0.05 0.03 0.03
------ ------ ------
Livermore Investments Group Limited
Condensed Consolidated Statement of Comprehensive Income
for the six months ended 30 June 2019
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Profit for the period / year 9,102 6,350 5,162
Other comprehensive income:
Items that will be reclassified subsequently to profit or loss
Foreign exchange (losses) / gains from translation of subsidiaries (18) 7 12
------ ------ ------
9,084 6,357 5,174
------ ------ ------
Items that are not reclassified subsequently to profit or loss
Financial assets designated at fair value through other comprehensive
income
* Fair value (losses) / gains (420) 442 313
* Capital return - 1,400 1,400
------ ------ ------
Total comprehensive income for the period / year 8,664 8,199 6,887
------ ------ ------
The total comprehensive income for the period is wholly
attributable to the owners of the Company.
Livermore Investments Group Limited
Condensed Consolidated Statement of Changes in Equity
for the period ended 30 June 2019
Note Share Share Share Translation Investment Retained Total
capital premium option reserve revaluation earnings
reserve reserve
US $000 US $000 US $000 US $000 US $000 US $000 US $000
Balance at 1 January 2018 - 169,187 77 - (38,055) 44,236 175,445
Dividends - - - - - (7,999) (7,999)
Transfer on expiry of
options 13 - - (77) - - 77 -
------ ------ ------ ------ ------ ------ ------
Transactions with owners - - (77) - - (7,922) (7,999)
------ ------ ------ ------ ------ ------ ------
Profit for the year - - - - - 5,162 5,162
Other comprehensive income:
Financial assets at fair value
through OCI
* Fair value gains - - - - 313 - 313
* Capital return - - - - 1,400 - 1,400
Foreign exchange gains
arising from translation of
subsidiaries - - - 12 - - 12
Transfer of realised losses - - - - 16,051 (16,051) -
------ ------ ------ ------ ------ ------ -----
Total comprehensive income
for the year - - - 12 17,764 (10,889) 6,887
------ ------ ------ ------ ------ ------ ------
Balance at 31 December 2018 - 169,187 - 12 (20,291) 25,425 174,333
------ ------ ------ ------ ------ ------ ------
Profit for the period - - - - - 9,102 9,102
Other comprehensive income:
Financial assets at fair value
through OCI
* Fair value losses - - - - (420) - (420)
Foreign exchange losses
arising from translation of
subsidiaries - - - (18) - - (18)
Transfer of realised losses - - - - 519 (519) -
------ ------ ------ ------ ------ ------ ------
Total comprehensive income for the
period - - - (18) 99 8,583 8,664
------ ------ ------ ------ ------ ------ ------
Balance at 30 June 2019 - 169,187 - (6) (20,192) 34,008 182,997
------ ------ ------ ------ ------ ------ ------
Share Share Share Translation Investment Retained Total
capital premium option reserve revaluation earnings
Note reserve reserve
US $000 US $000 US $000 US $000 US $000 US $000 US $000
Balance at 1 January 2018 - 169,187 77 - (38,055) 44,236 175,445
Dividends - - - - - (7,999) (7,999)
Transfer on expiry of
options 13 - - (77) - - 77 -
------ ------ ------ ------ ------ ------ ------
Transactions with owners - - (77) - - (7,922) (7,999)
------ ------ ------ ------ ------ ------ ------
Profit for the period - - - - - 6,350 6,350
Other comprehensive income:
Financial assets at fair
value through OCI
* Fair value gains - - - - 442 - 442
* Capital return - - - - 1,400 - 1,400
Foreign exchange gains
arising from translation of
subsidiaries - - - 7 - - 7
Transfer of realised losses - - - - 12,579 (12,579) -
------ ------ ------ ------ ------ ------ ------
Total comprehensive income for the
period - - - 7 14,421 (6,229) 8,199
------ ------ ------ ------ ------ ------ ------
Balance at 30 June 2018 - 169,187 - 7 (23,634) 30,085 175,645
------ ------ ------ ------ ------ ------ ------
Livermore Investments Group Limited
Condensed Consolidated Statement of Cash Flows
for the period ended 30 June 2019
Note Six months Six months Year
ended ended ended
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Cash flows from operating activities
Profit before tax 9,113 6,359 5,176
Adjustments for:
Depreciation expense 42 4 8
Interest expense 20 10 10 30
Interest and distribution income 17 (11,512) (15,706) (31,541)
Bank interest income 20 (133) (106) (233)
Changes in value of investments 18 (923) 7,667 17,380
Exchange differences 20 (68) 174 215
------ ------ ------
(3,471) (1,598) (8,965)
Changes in working capital
(Increase) / decrease in trade and other receivables (2,962) (19) 2,576
Increase / decrease in trade and other payables (894) 1,579 1,950
------ ------ ------
Cash flows from operations (7,327) (38) (4,339)
Interest and distribution received 11,442 15,785 31,748
Tax paid (11) (7) (14)
------ ------ ------
Net cash from operating activities 4,104 15,740 27,295
------ ------ ------
Cash flows from investing activities
Acquisition of investments (31,739) (48,899) (120,027)
Proceeds from sale of investments 21,068 49,725 91,623
Proceeds from capital return - 1,400 1,400
------ ------ ------
Net cash from investing activities (10,671) 2,226 (27,004)
------ ------ ------
Cash flows from financing activities
Interest paid (64) (10) (30)
Dividends paid - (7,999) (7,999)
Lease liability payments (41) - -
------ ------ ------
Net cash from financing activities (105) (8,009) (8,029)
------ ------ ------
Net increase / (decrease) in cash and cash equivalents (6,672) 9,957 (7,738)
Cash and cash equivalents at beginning of the period / year 26,214 34,175 34,175
Exchange differences on cash and cash equivalents 129 (173) (215)
Translation differences on foreign operations' cash and
cash equivalents - (14) (8)
------ ------ ------
Cash and cash equivalents at the end of the period / year 11 19,671 43,945 26,214
------ ------ ------
Notes to the Interim Condensed Consolidated Financial
Statements
1. Tax residency
During the period after a successful application the Company
became a tax resident in the Republic of Cyprus.
2. Accounting policies
The interim condensed consolidated financial statements of
Livermore have been prepared on the basis of the accounting
policies stated in the 2018 Annual Report, available on
www.livermore-inv.com.
The Company has applied IFRS 16 'Leases' (see below) since its
date of initial application, being 1 January 2019. The application
of the IFRS pronouncements, including IFRS 16, that became
effective as of 1 January 2019 has no significant impact on the
Company's consolidated financial statements.
IFRS 16 replaces IAS 17 'Leases' along with three
Interpretations (IFRIC 4 'Determining whether an Arrangement
contains a Lease', SIC 15 'Operating Leases-Incentives' and SIC 27
'Evaluating the Substance of Transactions Involving the Legal Form
of a Lease').
The Company recognised on 1 January 2019 a right-of-use asset
and related lease liability in connection with a former operating
lease, with a remaining lease term at that date of 5 years. The
right-of-use asset at that date has been measured at USD 411,041
equal to the lease liability, without including any initial direct
costs. For a second former operating lease that has a short-term
lease term, the Company elected to recognise the lease expense on a
straight-line basis over the lease term.
IFRS 16 has been applied using the modified retrospective
approach. No adjustment to opening retained earnings occurred.
Prior periods have not been restated.
3. Critical accounting judgements and estimation uncertainty
When preparing the interim condensed consolidated financial
statements, management undertakes a number of judgements, estimates
and assumptions about recognition and measurement of assets,
liabilities, income and expenses. The actual results may differ
from the judgements, estimates and assumptions made by Management,
and will seldom equal the estimated results. The judgements,
estimates and assumptions applied in the interim condensed
consolidated financial statements, including the key sources of
estimation uncertainty were the same as those applied in the
Company's last annual consolidated financial statements for the
year ended 31 December 2018.
4. Basis of preparation
These unaudited interim condensed consolidated financial
statements are for the six months ended 30 June 2019. They have
been prepared in accordance with IAS 34 "Interim Financial
Reporting" as adopted by the European Union. 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 Company for the year ended 31 December
2018.
The financial information for the year ended 31 December 2018 is
extracted from the Company's consolidated financial statements for
the year ended 31 December 2018 which contained an unqualified
audit report.
Investment entity status
Livermore meets the definition of an investment entity, as this
is defined in IFRS 10 "Consolidated Financial Statements".
In accordance with IFRS 10, an investment entity is exempted
from consolidating its subsidiaries, unless any subsidiary which is
not itself an investment entity mainly provides services that
relate to the investment entity's investment activities. In
Livermore's situation, two of its subsidiaries provide such
services. Note 9 shows further details of the consolidated and
unconsolidated subsidiaries.
References to the Company hereinafter also include its
consolidated subsidiaries (note 9).
5. Financial assets at fair value through profit or loss
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Non-current assets
Fixed income investments (CLO Income Notes) 106,134 108,462 97,081
------ ------ ------
106,134 108,462 97,081
------ ------ ------
Current assets
Fixed income investments 42,293 6,116 39,590
Public equity investments 1,612 2,815 1,477
------ ------ ------
43,905 8,931 41,067
------ ------ ------
For description of each of the above categories, refer to note
7.
The above investments represent financial assets that are
mandatorily measured at fair value through profit or loss.
The Company treats its investments in the loan market through
CLOs as non-current investments as the Company generally intends to
hold such investments over a period longer than twelve months.
6. Financial assets at fair value through other comprehensive income
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Non-current assets
Private equities 6,518 7,571 6,387
------ ------ ------
Current assets
Hedge funds - 1,118 1,117
------ ------ ------
For description of each of the above categories, refer to note
7.
The above investments are non-trading equity investments that
have been designated at fair value through other comprehensive
income.
7. Financial assets at fair value
The Company allocates its non-derivative financial assets at
fair value (notes 5 and 6) as follows:
-- Fixed income investments relate to investments in the loan
market through CLOs and open warehouse facilities, as well as
investments in fixed and floating rate bonds and perpetual bank
debt.
-- Private equities relate to investments in the form of equity
purchases in both high growth opportunities in emerging markets and
deep value opportunities in mature markets. The Company generally
invests directly in prospects where it can exert influence. Main
investments under this category are in the fields of real
estate.
-- Hedge funds relate to equity investments in funds managed by
sophisticated investment managers that pursue investment strategies
with the goal of generating absolute returns.
-- Public equity investments relate to investments in shares of
companies listed on public stock exchanges.
8. Fair value measurements of financial assets and liabilities
The table in note 8.2 below presents financial assets measured
at fair value in the statement of financial position in accordance
with the fair value hierarchy. This hierarchy groups financial
assets and liabilities into three levels based on the significance
of inputs used in measuring the fair value of the financial assets
and liabilities. The fair value hierarchy has the following
levels:
- Level 1: quoted prices (unadjusted) in active markets for
identical assets or liabilities that the entity can access at the
measurement date;
- Level 2: inputs other than quoted prices included within Level
1 that are observable for the asset or liability, either directly
or indirectly; and
- Level 3: unobservable inputs for the asset or liability.
The level within which the financial asset is classified is
determined based on the lowest level of significant input to the
fair value measurement.
8.1 Valuation of financial assets and liabilities
-- Fixed Income Investments and Public Equity Investments are
valued per their closing market prices on quoted exchanges, or as
quoted by market maker. Investments in open warehouse facilities
that have not yet been converted to CLOs, are valued based on an
adjusted net asset valuation.
The Company values the CLOs based on the valuation reports
provided by market makers. CLOs are typically valued by market
makers using discounted cash flow models. The key assumptions for
cash flow projections include default and recovery rates,
prepayment rates and reinvestment assumptions on the underlying
portfolios (typically senior secured loans) of the CLOs.
Default and recovery rates: The amount and timing of defaults in
the underlying collateral and the amount and timing of recovery
upon a default affect are key to the future cash flows a CLO will
distribute to the CLO equity tranche. All else equal, higher
default rates and lower recovery rates typically lead to lower cash
flows. Conversely, lower default rates and higher recoveries lead
to higher cash flows.
Prepayment rates: Senior loans can be pre-paid by borrowers.
CLOs that are within their reinvestment period may, subject to
certain conditions, reinvest such prepayments into other loans
which may have different spreads and maturities. CLOs that are
beyond their reinvestment period typically pay down their senior
liabilities from proceeds of such pre-payments. Therefore the rate
at which the underlying collateral prepays impacts the future cash
flows that the CLO may generate.
Reinvestment assumptions: A CLO within its reinvestment period
may reinvest proceeds from loan maturities, prepayments, and
recoveries into purchasing additional loans. The reinvestment
assumptions define the characteristics of the loans that a CLO may
reinvest in. These assumptions include the spreads, maturities, and
prices of such loans. Reinvestment into loans with higher spreads
and lower prices will lead to higher cash flows. Reinvestment into
loans with lower spreads will typically lead to lower cash
flows.
Discount rate: The discount rate indicates the yield that market
participants expect to receive and is used to discount the
projected future cash flows. Higher yield expectations or discount
rates lead to lower prices and lower discount rates lead to higher
prices for CLOs.
-- Private Equities are valued using market valuation techniques
as determined by the Directors, mainly based on valuations reported
by third-party managers of such investments. Real Estate entities
are valued by independent qualified property valuers with
substantial relevant experience on such investments. Underlying
property values are determined based on their estimated market
values.
-- Hedge Funds are valued per reports provided by the funds on a
periodic basis, and if traded, per their closing bid market prices
on quoted exchanges, or as quoted by market maker.
-- Investments in subsidiaries are valued at fair value as
determined on an adjusted net asset valuation basis.
8.2 Fair Value Hierarchy
Financial assets measured at fair value are grouped into the
fair value hierarchy as follows:
30 June 2019 Unaudited Unaudited Unaudited Unaudited
US $000 US $000 US $000 US $000
Level 1 Level 2 Level 3 Total
Assets
Fixed income investments 1,125 106,134 41,168 148,427
Private equities - - 6,518 6,518
Public equity investments 1,612 - - 1,612
Investments in subsidiaries - - 5,443 5,443
------ ------ ------ ------
2,737 106,134 53,129 162,000
------ ------ ------ ------
30 June 2018 Unaudited Unaudited Unaudited Unaudited
US $000 US $000 US $000 US $000
Level 1 Level 2 Level 3 Total
Assets
Fixed income investments 1,116 108,462 5,000 114,578
Private equities - - 7,571 7,571
Public equity investments 2,815 - - 2,815
Hedge funds - 1,118 - 1,118
Investments in subsidiaries - - 5,387 5,387
------ ------ ------ ------
3,931 109,580 17,958 131,469
------ ------ ------ ------
31 December 2018 Audited Audited Audited Audited
US $000 US $000 US $000 US $000
Level 1 Level 2 Level 3 Total
Assets
Fixed income investments 1,100 97,081 38,490 136,671
Private equities - - 6,387 6,387
Public equity investments 1,477 - - 1,477
Hedge funds - 1,117 - 1,117
Investments in subsidiaries - - 5,205 5,205
------ ------ ------ ------
2,577 98,198 50,082 150,857
------ ------ ------ ------
The methods and valuation techniques used for the purpose of
measuring fair value are unchanged compared to the previous
reporting period.
No financial assets or liabilities have been transferred between
different levels.
Financial assets within level 3 can be reconciled from beginning
to ending balances as follows:
Six months ended 30 At fair At fair value
June 2019 value through through profit Investments
OCI or loss in subsidiaries
Private Fixed Income
equities investments Total
US $000 US $000 US $000 US $000
As at 1 January 2019 6,387 38,490 5,205 50,082
Purchases - 20,000 - 20,000
Settlement - (20,000) - (20,000)
Gains /(losses) recognised
in:
-Profit or loss - 2,678 238 2,916
-Other comprehensive
income 131 - - 131
------ ------ ------ ------
As at 30 June 2019 6,518 41,168 5,443 53,129
------ ------ ------ ------
Six months ended 30 At fair At fair value
June 2018 value through through profit Investments
OCI or loss in subsidiaries
Private Fixed Income
equities investments Total
US $000 US $000 US $000 US $000
As at 1 January 2018 7,129 25,515 5,426 38,070
Purchases - 15,000 - 15,000
Settlement - (35,000) - (35,000)
Gains / (losses) recognised
in:
-Profit or loss - (515) (39) (554)
-Other comprehensive
income 442 - - 442
------ ------ ------ ------
As at 30 June 2018 7,571 5,000 5,387 17,958
------ ------ ------ ------
Year ended 31 December At fair At fair value
2018 value through through profit Investments
OCI or loss in subsidiaries
Private Fixed Income
equities investments Total
US $000 US $000 US $000 US $000
As at 1 January 2018 7,129 25,515 5,426 38,070
Purchases - 75,000 - 75,000
Settlement (1,055) (62,500) - (63,555)
Gains / (losses) recognised
in:
-Profit or loss - 475 (221) 254
-Other comprehensive
income 313 - - 313
------ ------ ------ ------
As at 31 December
2018 6,387 38,490 5,205 50,082
------ ------ ------ ------
The above recognised gains / (losses) are allocated as
follows:
Six months ended 30 At fair
June 2019 At fair value through
value through profit or Investments
OCI loss in subsidiaries
Private Fixed Income
equities investments Total
US $000 US $000 US $000 US $000
Profit or loss
-Financial assets held
at period-end - 2,678 238 2,916
------ ------ ------ ------
Other comprehensive
income
-Financial assets held
at period-end 131 - - 131
------ ------ ------ ------
Total gains / (losses)
for period 131 2,678 238 3,047
------ ------ ------ ------
Six months ended 30 At fair At fair Investments
June 2018 value through value through in subsidiaries
OCI profit or
loss
Private Fixed Income
equities investments Total
US $000 US $000 US $000 US $000
Profit or loss
-Financial assets held
at period-end - (515) (39) (554)
------ ------ ------ ------
Other comprehensive
income
-Financial assets held
at period-end 442 - - 442
------ ------ ------ ------
Total gains / (losses)
for period 442 (515) (39) (112)
------ ------ ------ ------
Year ended 31 December At fair At fair Investments
2018 value through value through in subsidiaries
OCI profit or
loss
Private Fixed Income
equities investments Total
US $000 US $000 US $000 US $000
Profit or loss
-Financial assets held
at period-end - 990 (221) 769
-Financial assets not
held at period-end - (515) - (515)
------ ------ ------ ------
- 475 (221) 254
------ ------ ------ ------
Other comprehensive
income
-Financial assets held
at period-end 313 - - 313
------ ------ ------ ------
Total gains / (losses)
for period 313 475 (221) 567
------ ------ ------ ------
The Company has not developed itself any quantitative
unobservable inputs for measuring the fair value of its level 3
financial assets at the reporting date. Instead the Group used
prices from third - party pricing information without
adjustment.
Fixed income investments within level 3 represent open
warehouses that have been valued based on their net asset value.
Their net asset value is primarily driven by the fair value of
their underlying loan asset portfolio plus received and accrued
interest less the nominal value of the financing and accrued
interest on the financing. In all cases, due to the nature and the
short life of a warehouse, the carrying amounts of the warehouses'
underlying assets and liabilities are considered as representative
of their fair values.
Private equities within level 3 represent investments in private
equity funds. Their value has been determined by each fund manager
based on the funds' net asset value. Each fund's net asset value is
primarily driven by the fair value of its underlying investments.
In all cases, considering that such investments are measured at
fair value, the carrying amounts of the funds' underlying assets
and liabilities are considered as representative of their fair
values.
Investments in subsidiaries have been valued based on their net
asset position. The main assets of the subsidiaries represent
investments measured at fair value and receivables from the Company
itself. Their net asset value is considered as a fair approximation
of their fair value.
A reasonable change in any individual significant input used in
the level 3 valuations is not anticipated to have a significant
change in fair values as above.
9. Investment in subsidiaries
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Unconsolidated subsidiaries
As at 1 January 5,205 5,426 5,426
Fair value gains / (losses) 238 (39) (221)
------ ------ ------
As at 30 June / 31 December 5,443 5,387 5,205
------ ------ ------
Details of the investments in which the Company has a
controlling interest are as follows:
Name of Subsidiary Place of Holding Proportion Principal activity
incorporation of voting
rights
and shares
held
Consolidated subsidiaries
Livermore Capital Switzerland Ordinary shares 100% Administration services
AG
Livermore Investments Cyprus Ordinary shares 100% Administration services
Cyprus Limited (dormant) - see
below
Unconsolidated subsidiaries
Livermore Properties British Virgin Ordinary shares 100% Holding of investments
Limited Islands
Mountview Holdings British Virgin Ordinary shares 100% Investment vehicle
Limited Islands
Sycamore Loan Strategies Cayman Islands Ordinary shares 100% Investment vehicle
Ltd
Livermore Israel Israel Ordinary shares 100% Dormant
Investments Ltd
Sandhirst Ltd Cyprus Ordinary shares 100% Holding of investments
Livermore Investments Cyprus Limited during the period ceased
its operations, and as a result has been deconsolidated by 30 June
2019. The Directors' intention is to dissolve it after the
reporting date. The fair value and the net asset value (no assets
or liabilities) at 30 June 2019 is nil, therefore no amount has
been added to the investment in subsidiaries.
10. Trade and other receivables
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Financial items
Accrued interest and distribution income 205 3 1
Amounts due by related parties (note 23) 6,061 5,679 3,104
------ ------ ------
6,266 5,682 3,105
Non-Financial items
Prepayments 67 79 60
VAT receivable - 2 3
------ ------ ------
6,333 5,763 3,168
------ ------ ------
Allocated as:
Current assets 6,333 3,184 3,168
Non-current assets (note 23(2)) - 2,579 -
------ ------ ------
6,333 5,763 3,168
------ ------ ------
11. Cash and cash equivalents
Cash and cash equivalents included in the cash flow statement
comprise the following at the reporting date:
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Cash at bank 19,689 44,125 26,214
Bank overdraft used for cash management purposes (18) (180) -
------ ------ ------
Cash and cash equivalents 19,671 43,945 26,214
------ ------ ------
12. Share capital
Livermore Investments Group Limited (the "Company") is an
investment company incorporated under the laws of the British
Virgin Islands. The Company has an issued share capital of
174,813,998 ordinary shares with no par value.
13. Share options
The Company has no outstanding share options at the end of the
period.
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
No. of Options No. of Options No. of Options
Outstanding and exercisable options
At 1 January - 500,000 500,000
Options expired - (500,000) (500,000)
--------- --------- ---------
At 30 June / 31 December - - -
--------- --------- ---------
14. Trade and other payables
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Financial items
Trade payables 37 75 44
Amounts due to related parties (note 23) 3,906 4,462 3,731
Accrued expenses 1,090 1,019 2,152
------ ------ ------
5,033 5,556 5,927
------ ------ ------
15. Net asset value per share
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
Net assets attributable to ordinary shareholders (USD 000) 182,997 175,645 174,333
------------- ------------- -------------
Closing number of ordinary shares in issue 174,813,998 174,813,998 174,813,998
------------- ------------- -------------
Basic net asset value per share (USD) 1.05 1.00 1.00
------------- ------------- -------------
No dilutive instruments exist at any of the reporting dates
presented, and as a result the dilutive net asset value per share
equals the basic net asset value per share.
16. Segment reporting
The Company's activities fall under a single operating
segment.
The Company's investment income and its investments are divided
into the following geographical areas:
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Investment Income
Other European countries 367 (163) (217)
United States 11,803 8,681 15,411
India 3 (89) (89)
Asia 262 (390) (944)
------ ------ ------
12,435 8,039 14,161
------ ------ ------
Investments
Other European countries 2,247 2,663 2,209
United States 149,046 116,699 138,310
India 710 1,463 712
Asia 9,997 10,644 9,626
------ ------ ------
162,000 131,469 150,857
------ ------ ------
Investment income, comprising interest and distribution income
as well as gains or losses on investments, is allocated based on
the issuer's location. Investments are also allocated based on the
issuer's location.
The Company has no significant dependencies, in respect of its
investment income, on any single issuer.
17. Interest and distribution income
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Interest from investments 357 63 101
Distribution income 11,155 15,643 31,440
------ ------ ------
11,512 15,706 31,541
------ ------ ------
Interest and distribution income is analysed between the
Company's different categories of financial assets, as follows:
Six months ended 30 June 2019
Unaudited
Interest from Distribution Total
investments income
Financial assets at fair value US $000 US $000 US $000
through profit or loss
Fixed income investments 357 10,903 11,260
Public equity investments - 252 252
------ ------ ------
357 11,155 11,512
------ ------ ------
Six months ended 30 June 2018
Unaudited
Interest from Distribution Total
investments income
Financial assets at fair value US $000 US $000 US $000
through profit or loss
Fixed income investments 37 15,632 15,669
Public equity investments - 11 11
------ ------ ------
37 15,643 15,680
------ ------ ------
Financial assets at amortised
cost
Loan receivable (note 23) 26 - 26
------ ------ ------
63 15,643 15,706
------ ------ ------
Year ended 31 December 2018
Audited
Interest from Distribution Total
investments income
Financial assets at fair value US $000 US $000 US $000
through profit or loss
Fixed income investments 75 29,728 29,803
Public equity investments - 868 868
------ ------ ------
75 30,596 30,671
------ ------ ------
Financial assets at fair value
through other comprehensive income
Private equities - 844 844
------ ------ ------
Financial assets at amortised
cost
Loan receivable (note 23) 26 - 26
------ ------ ------
101 31,440 31,541
------ ------ ------
18. Changes in value of investments
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Fair value gains / (losses) on financial assets through profit or
loss 685 (7,628) (17,159)
Fair value gains / (losses) on investment in subsidiaries 238 (39) (221)
------ ------ ------
923 (7,667) (17,380)
------ ------ ------
The investments disposed of had the following cumulative (i.e.
from the date of acquisition up to the date of disposal) financial
impact in the Company's net asset position:
Disposed in 2019
Realised (losses)/ gains* Cumulative distribution or Total financial impact
Unaudited interest Unaudited
Unaudited
US $000 US $000 US $000
Financial assets at fair value
through profit or loss
Fixed income investments (5,341) 12,147 6,806
------ ------ ------
Financial assets at fair
value through other
comprehensive income
Hedge funds (519) - (519)
------ ------ ------
(5,860) 12,147 6,287
------ ------ ------
* difference between disposal proceeds and original acquisition
cost
19. Operating expenses
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Directors' fees and expenses 1,842 428 5,730
Other salaries and expenses 89 82 156
Professional and consulting fees 1,004 529 1,896
Legal expenses 2 7 27
Bank custody fees 54 56 104
Office cost 115 185 382
Depreciation 42 4 8
Other operating expenses 339 288 588
Audit fees 26 23 82
------ ------ ------
3,513 1,602 8,973
------ ------ ------
20. Finance costs and income
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Finance costs
Bank interest 10 10 30
Foreign exchange loss - 174 215
------ ------ ------
10 184 245
------ ------ ------
Finance income
Bank interest income 133 106 233
Foreign exchange gain 68 - -
------ ------ ------
201 106 233
------ ------ ------
21. Dividends
The Board of Directors will decide on the Company's dividend
policy for 2019 based on profitability, liquidity requirements,
portfolio performance, market conditions, and the share price of
the Company relative to its net asset value.
22. Earnings per share
Basic profit per share has been calculated by dividing the net
profit attributable to ordinary shareholders of the Company by the
weighted average number of shares in issue of the Company during
the relevant financial periods.
Six months Six months Year ended
ended 30 June ended 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
Profit for the period / year attributable to ordinary shareholders
of the parent (USD 000) 9,102 6,350 5,162
--------- --------- ---------
Weighted average number of ordinary shares outstanding 174,813,998 174,813,998 174,813,998
--------- --------- ---------
Basic earnings per share (USD) 0.05 0.03 0.03
--------- --------- ---------
No dilutive instruments exist at any of the reporting dates
presented, and as a result the dilutive earnings per share equals
the basic net asset value per share.
23. Related party transactions
The Company is controlled by Groverton Management Ltd, an entity
owned by Noam Lanir, which
at 30 June 2019 held 76.62% of the Company's voting rights.
30 June 30 June 31 December
2019 2018 2018
Unaudited Unaudited Audited
US $000 US $000 US $000
Amounts receivable from unconsolidated subsidiaries
Sandhirst Limited 131 56 104 (1)
------- ------- -------
Amounts receivable from key management
Directors' current accounts 5,930 3,044 3,000 (1)
Loan receivable - 2,579 - (2)
------- ------- -------
5,930 5,623 3,000
------- ------- -------
Amounts payable to unconsolidated subsidiaries
Livermore Israel Investments Ltd (3,522) (4,276) (3,522) (3)
------- ------- -------
Amounts payable to other related party
Loan payable (149) (149) (149) (4)
------- ------- -------
Amounts payable to key management
Directors' current accounts (172) (30) (48) (3)
Other key management personnel (63) (7) (12) (5)
------- ------- -------
(235) (37) (60)
------- ------- -------
Key management compensation
Short term benefits
Executive Directors' fees 398 398 795 (6)
Executive Directors' reward payments 1,400 - 4,804
Non-executive Directors' fees 44 31 60
Non-executive Directors' reward payments - - 71
Other key management fees 632 149 1,084 (7)
------- ------- -------
2,474 578 6,814
------- ------- -------
(1) The amounts receivable from unconsolidated subsidiaries and
the Directors' current accounts with debit balances are interest
free, unsecured, and have no stated repayment date.
(2) A loan of USD 2.500m was made to a key management employee
for the acquisition of shares in the Company. Interest is payable
on the loan at 6 month US LIBOR plus 0.25% per annum and the loan
is secured on the shares acquired. The loan, including interest
accrued, was repayable on the earlier of the employee leaving the
Company or August 2019. The loan including interest accrued was
settled during 2018. For June 2018, the loan was included within
trade and other receivables (note 10).
(3) The amounts payable to unconsolidated subsidiaries and
Directors' current accounts with credit balances are interest free,
unsecured, and have no stated repayment date.
(4) A loan with a balance at 30 June 2019 of USD 0.149m has been
received from a related company (under common control) Chanpak Ltd.
The loan is free of interest, unsecured and repayable on demand.
This loan is included within trade and other payables (note
14).
(5) The amount payable to other key management personnel relates
to a payment made on behalf of the Company for investment purposes
and accrued consultancy fees.
(6) These payments were made directly to companies which are related to the Directors.
(7) Other key management fees are included within professional fees (note 19).
No social insurance and similar contributions nor any other
defined benefit contributions plan costs incurred for the Group in
relation to its key management personnel in either 2019 or
2018.
Noam Lanir, through an Israeli partnership, is the major
shareholder of Babylon Limited, an Israel based Internet Services
Company. The Company as of 30 June 2019 held a total of 1.941m
shares at a value of USD 0.856m which represents 4% of its
effective voting rights.
24. Litigation
Fairfield Sentry Ltd vs custodian bank and beneficial owners
One of the custodian banks that the Company uses faces a
contingent claim up to USD 2.1m, and any interest as will be
decided by a US court and related legal fees, with regard to the
redemption of shares in Fairfield Sentry Ltd, which were bought in
2008 at the request of Livermore and on its behalf. If the claim
proves to be successful Livermore will have to compensate the
custodian bank since the transaction was carried on Livermore's
behalf. The same case was also filed in BVI where the Privy Council
ruled against the plaintiffs.
As a result of the surrounding uncertainties over the existence
of any obligation for Livermore, as well as for the potential
amount of exposure, the Directors cannot form an estimate of the
outcome for this case and therefore no provision has been made.
No further information is provided on the above case as the
Directors consider it could prejudice its outcome.
25. Commitments
The Company has expressed its intention to provide financial
support to its subsidiaries, where necessary to enable them to meet
their obligations as they fall due.
Other than the above, the Company has no capital or other
commitments as at 30 June 2019.
26. Events after the reporting date
Both warehouse facilities that the Company invested in, during
2019, with a carrying amount as at 30 June 2019 of USD 37.5m, were
closed in August 2019, and Livermore's investment amount plus net
carry amounting to a total of USD 41.2m became receivable in August
2019.
There were no other material events after the reporting date,
which have a bearing on the understanding of these interim
condensed consolidated financial statements.
27. Preparation of interim financial statements
Interim condensed consolidated financial statements are
unaudited. Consolidated financial statements for Livermore
Investments Group Limited for the year ended 31 December 2018,
prepared in accordance with International Financial Reporting
Standards as adopted by the European Union, on which the auditors
gave an unqualified audit report are available on the Company's
website www.livermore-inv.com.
Review Report to Livermore Investments
Group Limited
Report on the Review of the Condensed Consolidated Financial
Statements
Introduction
We have reviewed the accompanying interim condensed consolidated
financial statements of Livermore Investments Group Limited (the
"Company") and its consolidated subsidiaries (together with the
Company "the Group"), which are presented in pages 8 to 30 and
comprise the condensed consolidated statement of financial position
as at 30 June 2018 and the condensed consolidated statements of
comprehensive income, changes in equity, and cash flows for the
period from 1 January to 30 June 2018, and other explanatory
information.
The Board of Directors is responsible for the preparation and
fair presentation of these interim condensed consolidated financial
statements in accordance with International Accounting Standard 34
"Interim Financial Reporting" as adopted by the European Union
(EU). Our responsibility is to express a conclusion on these
interim condensed consolidated financial statements based on our
review.
Scope of Review
We conducted our review in accordance with the International
Standard on Review Engagement 2410 "Review of Interim Financial
Information Performed by the Independent Auditor of the Entity". A
review of interim financial information consists of making
inquiries, primarily of persons responsible for financial and
accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit
conducted in accordance with International Standards on Auditing
and consequently does not enable us to obtain assurance that we
would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit
opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the accompanying interim condensed
consolidated financial statements do not give a true and fair view,
in all material respects, of the financial position of the Group of
Livermore Investments Group Limited as at 30 June 2018 and of their
financial performance and its cash flows for the period from 1
January to 30 June 2018 in accordance with the International
Accounting Standard 34 "Interim Financial Reporting" as adopted by
the EU.
Other Matter
This report, including the conclusion, has been prepared for and
only for the Company and for no other purpose. We do not, in giving
this conclusion, accept or assume responsibility for any other
purpose or to any other person to whose knowledge this report may
come to.
Nicos Mouzouris
Certified Public Accountant and Registered
Auditor
for and on behalf of
Grant Thornton (Cyprus) Ltd
Certified Public Accountants and Registered
Auditors
Limassol, 23 September 2018
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR KMGMLKVLGLZM
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