TIDMTRC
RNS Number : 8896S
Trinity Capital PLC
29 December 2016
Trinity Capital PLC
Consolidated financial statements for the period ended 30
September 2016
Trinity Capital PLC (AIM: TRC), an Indian real estate fund,
announces its Interim Results for the period ended 30 September
2016.
For further information, please contact:
FIM Capital Limited
Graham Smith, Director +44 1624 681250
Arden Partners
Nominated Adviser and Broker
+44 207 614
Chris Hardie 5900
Chairman's Report
Dear Shareholder
The Board of Trinity Capital Plc ("Trinity" or the "Company") is
pleased to report significant progress implementing the Company's
investment policy during the current financial year. We completed a
settlement on 15 November 2016 with Immobilien Indien I GmbH &
Co. KG and Immobilien Indien II GmbH & Co. KG (together the
"Immobilien Funds"), which are managed by SachsenFonds and Deutsche
Fonds Holding. The settlement with the Immobilien Funds permitted a
further payment to shareholders of 5.0p per share, made on 16
December 2016, supplementing the 1.0p per share distribution paid
on 23 September 2016. Trinity has distributed GBP12.6 million (6.0p
per share) during the current financial year. In aggregate, the
Company has distributed GBP161.0 million (76.5p per share) to
investors since the end of 2010.
Under the terms of the settlement agreement with the Immobilien
Funds, the Company realised its investments in Trinity Capital
(One) Limited ("TC-1") and Trinity Capital (Five) Limited ("TC-5")
in return for a payment of GBP8.7 million. The Immobilien Funds
also agreed to permit and facilitate Trinity Capital (Ten) Limited
("TC-10") to distribute future disposal proceeds to the Company's
wholly owned subsidiary, Trinity Capital Mauritius Limited
("TCML"). In addition, all pending legal proceedings in Mauritius
between the parties have been discontinued.
The settlement and second shareholder distribution occurred
after the end of the financial period to which the enclosed half
yearly report relates. At 30 September 2016, Trinity's Net Asset
Value of GBP14.2 million (6.7p per share) included interests in
three investments held through TCML: TC-1, TC-5 and TC-10.
Following the sale of TCML's interests in TC-1 and TC-5, the
focus of the Board is now on the investment in TC-10. TC-10 is a
special purpose company which owns equity and mezzanine debt-type
securities issued by Indian company DB (BKC) Realtors Private
Limited ("MK Malls"). TCML established TC-10 in 2006 in order to
participate in the financing of the MK Malls project to develop
commercial and office space in the prime Bandra Kurla Complex
business district of Mumbai. Funds managed by IL&FS, one of
India's leading infrastructure development and finance companies,
invested alongside TC-10 in MK Malls. MK Malls is controlled and
managed by D B Realty, a high-profile property developer in Mumbai,
which has experienced difficulties in recent years. D B Realty's
problems have contributed to the delayed development of the MK
Malls site and, with limited availability of project financing, the
timing of construction commencement remains uncertain.
In 2007 and 2008, the Immobilien Funds acquired an 88% equity
interest in TC-10 together with 100% of a class of shares which
receive all of the economic benefits from the company's common
equity exposure to the MK Malls project. TCML retains a 12% equity
interest in TC-10 (thereby entitling it to a board seat) together
with 100% of a class of shares which receive all of the economic
benefits from the company's exposure to compulsorily convertible
preference shares ("CCPS") issued by MK Malls. The CCPS held by
TC-10 have a face value of INR1 billion (approximately GBP11.8
million at current exchange rates), a compounding return capped at
an IRR of 20% and priority over MK Malls' common equity. The face
value and compounding return on the CCPS are denominated in Rupees
and, as such, the Sterling equivalent has varied, and will continue
to vary, based on prevailing exchange rates.
Over a year ago, a sale of the CCPS to a potential buyer was
negotiated at a discount to face value that reflected various
risks, including potential issues in enforcing TC-10's rights in
India. Although sales documentation has been agreed between TC-10
and the buyer, financing has yet to materialise. Consequently, TCML
is seeking alternative buyers of the CCPS while evaluating its
legal rights. The carrying value of the investment in MK Malls is
based upon the negotiated sale price, adjusted to reflect the
possible delays and risks in completing the transaction.
Despite the attractive macroeconomic performance of the Indian
economy in the past three years, domestic real estate companies
suffer from scarce and expensive property development financing,
the uncertainties posed by the Government's recent currency reforms
and a weak Rupee (which increases the cost of foreign currency
debt).
There is no assurance that TCML or TC-10 will be successful in
selling the CCPS in the foreseeable future.
While we pursue a sale of the CCPS, the Board is also
reassessing the most appropriate continuing structure of the
Company and intends to communicate further with shareholders in due
course in this regard.
Yours faithfully
Martin M. Adams
Chairman
Consolidated Statement of Comprehensive Income
for the period ended 30 September 2016
Notes (unaudited) (unaudited) (audited)
6 Months to 6 Months to 12 Months to
30 Sept 30 Sept 31 Mar
2016 2015 2016
GBP'000 GBP'000 GBP'000
----------------------------------------------------- ------ -------------- -------------- ---------------
Fair value movement on investments 11 3,018 (972) (7,806)
Interest income from cash and cash equivalents 13 12 25
Foreign exchange loss (7) (2) (6)
----------------------------------------------------- -------------- -------------- ---------------
Net investment gain/(loss) 3,024 (962) (7,787)
----------------------------------------------------- ------ -------------- -------------- ---------------
Investment management fees 10 (76) (64) (133)
Other administration fees and expenses 6 (241) (317) (593)
Movement in legal fee provision 12 2,000 - -
----------------------------------------------------- ------ -------------- -------------- ---------------
Total expenses 1,683 (381) (726)
----------------------------------------------------- ------ -------------- -------------- ---------------
Profit/(loss) before tax 4,707 (1,343) (8,513)
Taxation - - -
----------------------------------------------------- ------ -------------- -------------- ---------------
Profit/(loss) for the period 4,707 (1,343) (8,513)
----------------------------------------------------- ------ -------------- -------------- ---------------
Other comprehensive income - - -
----------------------------------------------------- ------ -------------- -------------- ---------------
Profit/(loss) for the period 4,707 (1,343) (8,513)
----------------------------------------------------- ------ -------------- -------------- ---------------
Basic and diluted earnings/(loss) per share (pence) 8 2.2 (0.6) (3.3)
----------------------------------------------------- ------ -------------- -------------- ---------------
The notes form an integral part of these financial
statements.
Consolidated Statement of Financial Position
at 30 September 2016
(unaudited) (unaudited) (audited)
Notes 30 Sept 2016 30 Sept 2015 31 Mar 2016
GBP'000 GBP'000 GBP'000
----------------------------------------------------- ------ --------------- --------------- --------------
Non-current assets
Investments as at fair value through profit or loss 11 11,207 13,562 8,272
----------------------------------------------------- ------ --------------- --------------- --------------
Total non-current assets 11,207 13,562 8,272
----------------------------------------------------- ------ --------------- --------------- --------------
Current assets
Trade and other receivables 2 1 1
Cash and cash equivalents 3,170 5,972 5,656
Prepayments 25 28 30
----------------------------------------------------- ------ --------------- --------------- --------------
Total current assets 3,197 6,001 5,687
----------------------------------------------------- ------ --------------- --------------- --------------
Total assets 14,404 19,563 13,959
----------------------------------------------------- ------ --------------- --------------- --------------
Liabilities
Non-current liabilities
Provision for legal costs 12 - (2,000) (2,000)
----------------------------------------------------- ------ --------------- --------------- --------------
Total non-current liabilities - (2,000) (2,000)
----------------------------------------------------- ------ --------------- --------------- --------------
Current liabilities
Trade and other payables (184) (320) (342)
----------------------------------------------------- ------ --------------- --------------- --------------
Total current liabilities (184) (320) (342)
----------------------------------------------------- ------ --------------- --------------- --------------
Total liabilities (184) (2,320) (2,342)
----------------------------------------------------- ------ --------------- --------------- --------------
Net assets 14,220 17,243 11,617
----------------------------------------------------- ------ --------------- --------------- --------------
Represented by:
Share capital 7 2,107 2,107 2,107
Capital redemption reserves 214 214 214
Distributable reserves 11,899 14,922 9,296
----------------------------------------------------- ------ --------------- --------------- --------------
Total equity 14,220 17,243 11,617
----------------------------------------------------- ------ --------------- --------------- --------------
Net Asset Value per share (pence) 13 6.7 8.2 5.5
The notes form an integral part of these financial
statements.
These financial statements were approved by the Board on 28
December 2016 and signed on their behalf by
Stephen Coe Graham Smith
Director Director
Consolidated Statements of Changes in Equity
for the period ended 30 September 2016
Total Equity
Share Capital Capital Redemption Reserves Distributable Reserves Restated
GBP '000 GBP '000 GBP '000 GBP '000
------------------------------ -------------- ---------------------------- ----------------------- -------------
Balance at 1 April 2015 2,107 214 16,265 18,586
Total comprehensive loss - - (1,343) (1,343)
Balance at 30 September 2015 2,107 214 14,922 17,243
------------------------------ -------------- ---------------------------- ----------------------- -------------
Balance at 1 April 2015 2,107 214 16,265 18,586
Total comprehensive loss - - (6,969) (6,969)
Balance at 31 March 2016 2,107 214 9,296 11,617
------------------------------ -------------- ---------------------------- ----------------------- -------------
Balance at 1 April 2016 2,107 214 9,296 11,617
Total comprehensive income - - 4,707 4,707
Distribution (note 9) - - (2,104) (2,104)
Balance at 30 September 2016 2,107 214 11,899 14,220
------------------------------ -------------- ---------------------------- ----------------------- -------------
The notes form an integral part of these financial
statements.
Consolidated Statement of Cash Flows
for the period ended 30 September 2016
Notes (unaudited) (unaudited) (audited)
6 Months to 6 Months to 30 Sept 2015 12 Months to 31 Mar 2016
30 Sept 2016
GBP'000 GBP'000 GBP'000
------------------------------------ ------ -------------- --------------------------- ---------------------------
Cash flows from operating
activities
Profit/(loss) for the period 4,707 (1,343) (8,513)
Adjustments for:
Fair value movement on investments 11 (3,018) 972 7,806
Interest income from cash and cash
equivalents (13) (12) (25)
Movement in foreign exchange - 2 6
Movement in legal fee movement (2,000) - -
------------------------------------ ------ -------------- --------------------------- ---------------------------
(324) (381) (726)
Changes in working capital
(Decrease)/increase in receivables 4 (13) (15)
Decrease in payables (75) (25) (3)
Net cash used by operating
activities (395) (419) (744)
------------------------------------ ------ -------------- --------------------------- ---------------------------
Cash flows from investing
activities
Interest received 13 12 25
Net cash inflow from investing
activities 13 12 25
------------------------------------ ------ -------------- --------------------------- ---------------------------
Cash flows from financing
activities
Distributions 9 (2,104) - -
Net cash outflow from financing (2,104) - -
activities
------------------------------------ ------ -------------- --------------------------- ---------------------------
Net decrease in cash and cash
equivalents (2,486) (407) (719)
Cash and cash equivalents at the
start of the period 5,656 6,381 6,381
Effect of foreign exchange
fluctuation on cash held - (2) (6)
Cash and cash equivalents at the end of the
period 3,170 5,962 5,656
-------------------------------------------- -------------- --------------------------- ---------------------------
The notes form an integral part of these financial
statements.
Notes to the Financial Statements
for the period ended 30 September 2016
1. General information
The Company is a closed-end investment company incorporated on 7
March 2006 in the Isle of Man as a public limited company. The
Company is listed on the AIM Market of the London Stock
Exchange.
The Company and its subsidiaries (together the "Group") invest
in real estate and real estate related entities in India, primarily
in commercial development in the office and business space,
residential, retail, hospitality and infrastructure sectors
deriving returns from development, long-term capital appreciation
and income. In March 2009, shareholders voted to change the
Company's investment policy by requiring the Company to gradually
dispose of its assets over time and return capital to
investors.
The Group has no employees.
2. Statement of compliance
These interim consolidated financial statements have been
prepared in accordance with IAS 34 Interim Financial Reporting.
They do not include all of the information required for full annual
financial statements, and should be read in conjunction with the
consolidated financial statements of the Group as at and for the
year-ended 31 March 2016.
The consolidated financial statements of the Group as at and for
the year ended 31 March 2016 are available upon request from the
Company's registered office at IOMA House, Hope Street, Douglas,
Isle of Man or at www.trinitycapitalplc.com.
These interim consolidated financial statements were approved by
the Board of Directors on 28 December 2016.
3. Significant accounting policies
The accounting policies applied in these interim financial
statements are the same as those applied in the Group's
consolidated financial statements as at and for the year ended 31
March 2016.
There are no IFRS or IFRIC interpretations that are not yet
effective that would be expected to have a material impact to the
Company.
4. Critical accounting estimates and assumptions
The preparation of condensed consolidated interim financial
statements in conformity with IFRSs requires management to make
judgements, estimates, and assumptions that affect the application
of accounting policies and reported amounts of assets and
liabilities, income and expenses. The estimates and associated
assumptions are based on historical experience and various other
factors that are believed to be reasonable under the circumstances,
the results for which form the basis of making the judgements about
carrying values of assets and liabilities that are not readily
available from other sources. Actual results may differ from these
estimates.
In preparing these condensed consolidated financial statements,
the significant judgements made by management in applying the
Group's accounting policies were the same as those that applied to
the consolidated financial statements as at and for the year ended
31 March 2016.
5. Financial risk management policies
The principal risks and uncertainties are consistent with those
disclosed in preparation of the Group's annual financial statements
as at and for the year ended 31 March 2016.
6. Other administration fees and expenses
(unaudited) (unaudited) (audited)
6 Months to 6 Months to 12 Months to
30 Sept 2016 30 Sept 2015 31 Mar 2016
GBP'000 GBP'000 GBP'000
----------------------------------------------------- --------------- --------------- ---------------
Administration fees 77 72 147
Audit fees 19 11 33
Directors' fees including Directors' Incentive Plan 113 86 171
Legal fees and other professional costs 11 127 200
NOMAD & Broker 21 21 42
241 317 593
----------------------------------------------------- --------------- --------------- ---------------
7. Share capital
The authorised share capital at 30 September 2016 and 31 March
2016 and the issued and fully paid share capital at the same dates
were as follows:
Authorised Issued and fully paid
No. of Shares GBP No. of Shares GBP
Ordinary shares of GBP0.01 each 416,750,000 4,167,500 210,432,498 2,104,325
Deferred shares of GBP0.01 each 250,000 2,500 250,000 2,500
417,000,000 4,170,000 210,682,498 2,106,825
--------------------------------- -------------- ---------- -------------- ----------
8. Earnings/(loss) per share
The basic earnings/(loss) per ordinary share is calculated by
dividing the net loss attributable to the ordinary shareholders of
the Company by the weighted average number of ordinary shares in
issue during the period.
(unaudited) (unaudited)
6 Months to 6 Months to (audited) 12 Months to
30 Sept 2016 30 Sept 2015 31 Mar 2016
Earnings/ (loss) attributable to owners of parent
(GBP'000) 4,707 (1,343) (6,969)
Weighted average number of ordinary shares in issue ('000) 210,682 210,682 210,682
Earnings/(loss) per share (pence) 2.2 (0.6) (3.3)
----------------------------------------------------------- --------------- --------------- -----------------------
The Company has no potential dilutive ordinary shares; the
diluted earnings/(loss) per share is the same as the basic
earnings/(loss) per share.
9. Distributions
The Company made a distribution of 1.0 pence per share on 23
September 2016, amounting, in total, to GBP2.1 million. As detailed
in note 15, since the reporting date, the Company made a further
distribution of 5.0 pence per share, amounting, in total, to
GBP10.5 million.
Both distributions were paid out of the reserves created upon
cancellation of the share premium reserve which had arisen at the
time of the Company's admission to AIM in 2006.
10. Investment management fees
The Investment Management Agreement with Indiareit Investment
Management Company ("Indiareit") expired on 31 December 2013.
However, Indiareit has continued to provide certain investment
management services to the Company since the expiry date. Periodic
investment management fees were charged by Indiareit at the rate of
US$198,000 per annum.
11. Investments at fair value through profit or loss
The Group held partial ownership interests in three unquoted
Indian companies at the reporting date.
As detailed in note 15, the Company has, since the reporting
date disposed of two of its investments. As at 30 September 2016,
the valuation of these two investments was based on the negotiated
sales price.
The value of the Company's interest in Trinity Capital (Ten)
Limited ("TC-10") is based on the net sales proceeds estimated to
be received under the terms of a draft (but not yet binding) sale
and purchase agreement relating to TC-10's interest in the
compulsorily convertible preference shares ("CCPS") issued by the
Indian company, DB (BKC) Realtors Private Limited ("MK Malls"). The
negotiated sales price is significantly less than the face value of
the CCPS. The valuation of the investment in TC-10 has been
adjusted to account for execution and other risks in completing the
transaction.
Investments are recorded at fair value are as follows:
30 Sept
2016
GBP'000
Beginning of period 8,272
Fair value adjustment 3,018
Written off intercompany liabilities (83)
---------
End of period 11,207
---------
The fair value adjustment consists of:
30 Sept
2016
GBP'000
Change of investment values measured
in Indian Rupees 2,198
Appreciation of Rupee against Sterling 820
---------
Fair value movement as in Statement of
Comprehensive Income 3,018
---------
12. Movement in legal fee provision
Since January 2011, the Company has maintained a provision of
GBP2.0 million to cover the possible costs of defending against
legal actions brought by Immobilien Development Indien I GmbH &
Co. KG and Immobilien Development Indien II GmbH & Co. KG
(together the "Immobilien Funds"). As a result of the agreement
with the Immobilien Funds detailed in note 15, the Company has
reversed the provision.
13. Net asset value per share
(unaudited) (unaudited)
30 Sept 2016 30 Sept 2015 (audited) 31 March 2016
Net assets attributable to shareholders (GBP'000) 14,220 17,243 11,617
Number of ordinary shares in issue ('000) 210,682 210,682 210,682
Net Asset Value (pence) 6.7 8.2 5.5
---------------------------------------------------- --------------- --------------- ------------------------
14. Related party transactions
Graham Smith is a Director of the Company and of the
Administrator. The fees paid to the Administrator for the period
amounted to GBP50,000 (six months ended 30 September 2015:
GBP50,000). Mr Smith was not paid a Director's fee during the
period.
15. Events after reporting date
As referred to in notes 11 and 12, on 20 October 2016 an
agreement was signed with the Immobilien Funds which facilitates
the realisation of all of the Company's remaining investments held
jointly with the Immobilien Funds. Accordingly, on 15 November
2016, the Company disposed of its investments in Trinity Capital
(One) Limited and Trinity Capital (Five) Limited held by its wholly
owned subsidiary Trinity Capital Mauritius Limited ("TCML") in
return for a payment of INR720,000,000 (GBP8.7 million). In
addition, the Immobilien Funds agreed to permit and facilitate
TC-10 to distribute to TCML the proceeds from a future sale of the
CCPS. All pending legal proceedings in Mauritius between the
parties have been discontinued.
As referred to in note 9, on 16 December 2016, the Company made
a 5.0 pence per share distribution (equivalent to GBP10.5
million).
There have been no other significant events since the reporting
date.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR UWRVRNSAUUAA
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December 29, 2016 02:00 ET (07:00 GMT)
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