20th May 2009 07:00
20 May 2009
MIRLAND DEVELOPMENT CORPORATION PLC
("MirLand" / "Company")
UNAUDITED INTERIM CONSOLIDATED REPORT FOR THE
THREE MONTHS ENDED 31 MARCH 2009
MirLand Development Corporation, one of the leading international residential and commercial property developers in Russia, today announces its interim results for the three months ended 31 March 2009.
Highlights:
Rental income and property management fees of US$4.2 million (31 March 2008: US$4.5 million). Reduction mainly due to a decrease in occupancy levels and rents
Loss before tax US$4.5 million (31 March 2008: profit US$4.6 million) *
Total assets US$519.3 million (31 December 2008: US$529.9 million) *
The Company continues to have modest leverage at 34% of its assets
Ongoing progress on key development projects including:
Perkhushkovo Western Residence phase 1
Triumph Mall, Saratov
Triumph Park, St. Petersburg - Phase 1 (the Company's flagship project)
Tamiz office buildings in Moscow
Century office buildings in Moscow completed during the period.
*Loss primarily due to the continued weakness of the Rouble against the US Dollar
Nigel Wright, Chairman, commented:
"In these rapidly changing times, we maintain our focus on our income producing investment portfolio and on the completion of projects under construction as stated in the Annual Report. In light of the current market conditions, the Company has also made some progress in reducing both construction costs and operational expenses.
"MirLand's Board and Senior Management are continuing in the prudent management of the business through this challenging period to position it for future growth."
For further information, please contact:
|
MirLand Development Corporation plc Roman Rozental |
+972 52 2776640 +7 499 130 31 09 |
|
Financial Dynamics Dido Laurimore / Rachel Drysdale |
+44 20 7831 3113 |
The difficult trading conditions in the Russian economy during the second half of 2008 persisted into the first quarter of 2009. GDP continued to fall, unemployment and the budget deficit both rose, and the Rouble weakened further. Nevertheless, by the end of the first quarter the Rouble and oil prices appeared to be stabilizing and we saw a slowdown in the withdrawal of foreign investment. The Government has continued its programme of economic support measures, financed mainly by use of its Reserve Fund, and we are hopeful that these actions will eventually lead to improving confidence and higher levels of activity in the medium term.
In the real-estate sector transaction activity fell considerably in the first quarter. Vacancy rates rose and rents and sale prices continued to fall. However, towards the end of the quarter and since the beginning of the second quarter we have begun to witness a slight increase in interest from potential tenants and buyers in the market, although at lower rental rates and sale prices than before.
In these rapidly changing times, we maintain our focus on our income producing investment portfolio and on the completion of projects under construction as stated in the Annual Report. In light of the current market conditions, the Company has also made some progress in reducing both construction costs and operational expenses. MirLand's Board and Senior Management are continuing in the prudent management of the business through this challenging period to position it for future growth.
INTERIM CONSOLIDATED FINANCIAL STATEMENTS AS OF 31 MARCH 2009 - UNAUDITED
CONSOLIDATED BALANCE SHEETS
|
31 March |
31 December |
|||||||
|
2009 |
2008 |
2008 |
||||||
|
Unaudited |
Audited |
|||||||
|
U.S. dollars in thousands |
||||||||
|
ASSETS |
||||||||
|
NON-CURRENT ASSETS: |
||||||||
|
Investment properties |
161,103 |
238,100 |
163,987 |
|||||
|
Investment properties under construction |
133,165 |
103,002 |
120,035 |
|||||
|
Long-term loans |
55,282 |
15,179 |
58,525 |
|||||
|
Advances on acquisition of subsidiaries |
- |
1,796 |
584 |
|||||
|
Deferred expenses |
1,577 |
958 |
1,936 |
|||||
|
Long-term receivables and prepayments |
13,631 |
20,672 |
16,172 |
|||||
|
Financial derivative |
- |
1,089 |
719 |
|||||
|
Deferred tax assets |
4,417 |
986 |
4,246 |
|||||
|
Fixed assets, net |
1,347 |
5,350 |
2,154 |
|||||
|
370,522 |
387,132 |
368,358 |
||||||
|
CURRENT ASSETS: |
||||||||
|
Inventories of buildings under construction |
132,253 |
113,023 |
144,202 |
|||||
|
Trade and other receivables |
6,683 |
6,289 |
7,566 |
|||||
|
Short-term loans |
1,059 |
18,948 |
- |
|||||
|
Restricted bank deposits |
- |
71,210 |
- |
|||||
|
Cash and cash equivalents |
8,794 |
77,599 |
9,822 |
|||||
|
148,789 |
287,069 |
161,590 |
||||||
|
Total assets |
519,311 |
674,201 |
529,948 |
|||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
CONSOLIDATED BALANCE SHEETS
|
31 March |
31 December |
|||||
|
2009 |
2008 |
2008 |
||||
|
Unaudited |
Audited |
|||||
|
U.S. dollars in thousands |
||||||
|
EQUITY AND LIABILITIES |
||||||
|
EQUITY: |
||||||
|
Equity attributable to equity holders of the Company: |
||||||
|
Share capital |
1,036 |
1,036 |
1,036 |
|||
|
Share premium |
359,803 |
359,803 |
359,803 |
|||
|
Share based payments |
8,273 |
6,682 |
8,080 |
|||
|
Retained earnings (accumulated deficit) |
(12,746) |
101,231 |
(8,202) |
|||
|
Currency translation reserve |
(53,158) |
18,059 |
(19,085) |
|||
|
Contribution from shareholders |
2,617 |
- |
579 |
|||
|
305,825 |
486,811 |
342,211 |
||||
|
Minority interests |
25 |
25 |
25 |
|||
|
Total equity |
305,850 |
486,836 |
342,236 |
|||
|
NON-CURRENT LIABILITIES: |
||||||
|
Debentures, net |
62,042 |
63,796 |
62,267 |
|||
|
Financial derivative |
251 |
- |
- |
|||
|
Long-term loans from banks |
16,973 |
19,399 |
17,443 |
|||
|
Long-term loans from shareholders |
- |
- |
9,032 |
|||
|
Other long-term liabilities |
8,681 |
12,966 |
8,112 |
|||
|
Deferred tax liability |
9,868 |
6,781 |
9,154 |
|||
|
97,815 |
102,942 |
106,008 |
||||
|
CURRENT LIABILITIES: |
||||||
|
Accounts payable and accruals |
17,421 |
9,204 |
17,032 |
|||
|
Short-term loans from banks |
68,203 |
72,669 |
62,196 |
|||
|
Loans from shareholders |
27,740 |
- |
- |
|||
|
Income tax payable |
2,282 |
2,550 |
2,476 |
|||
|
115,646 |
84,423 |
81,704 |
||||
|
Total liabilities |
213,461 |
187,365 |
187,712 |
|||
|
Total equity and liabilities |
519,311 |
674,201 |
529,948 |
|||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
CONSOLIDATED STATEMENTS OF INCOME (LOSS)
|
|
|
Three months ended
31 March
|
|
Year ended
31 December
|
||
|
|
|
2009
|
|
2008
|
|
2008
|
|
|
|
Unaudited
|
|
Audited
|
||
|
|
|
U.S. dollars in thousands (except per share data) |
||||
|
Revenues: |
||||||||||||||||||||
|
Rental income from investment properties |
3,607 |
3,958 |
17,949 |
|||||||||||||||||
|
Revenues from managing fees |
639 |
547 |
2,411 |
|||||||||||||||||
|
Total revenues |
4,246 |
4,505 |
20,360 |
|||||||||||||||||
|
Fair value adjustments of investment properties and investment properties under construction |
19,076 |
(1,493) |
(58,768) |
|||||||||||||||||
|
Operating expenses |
(1,517) |
(1,732) |
(7,291) |
|||||||||||||||||
|
General and administrative expenses |
(4,176) |
(4,760) |
(22,259) |
|||||||||||||||||
|
Adjustment of provision to service providers |
(1,783) |
- |
5,160 |
|||||||||||||||||
|
Other income (expenses) |
290 |
- |
(6,186) |
|||||||||||||||||
|
Finance costs |
(20,474) |
(3,822) |
(44,725) |
|||||||||||||||||
|
Finance income |
1,790 |
14,050 |
9,883 |
|||||||||||||||||
|
Profit (loss) before taxes on income |
(2,548) |
6,748 |
(103,826) |
|||||||||||||||||
|
Taxes on income |
1,996 |
2,146 |
1,005 |
|||||||||||||||||
|
Profit (loss) for the period |
(4,544) |
4,602 |
(104,831) |
|||||||||||||||||
|
Earnings per share (in U.S. dollars per share): |
||||||||||||||||||||
|
Basic and diluted |
(0.04) |
0.04 |
(1.01) |
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
|
Attributable to equity holders of the Company |
||||||||||||||||||
|
Share |
Currency |
|||||||||||||||||
|
Share |
Share |
based |
Accumulated |
translation |
Shareholders' |
Minority |
Total |
|||||||||||
|
capital |
premium |
payment |
deficit |
reserve |
contributions |
Total |
interests |
equity |
||||||||||
|
U.S. dollars in thousands |
||||||||||||||||||
|
Balance at 1 January 2009 |
1,036 |
359,803 |
8,080 |
(8,202) |
(19,085) |
579 |
342,211 |
25 |
342,236 |
|||||||||
|
Comprehensive loss |
- |
- |
- |
(4,544) |
(34,073) |
- |
(38,617) |
- |
(38,617) |
|||||||||
|
Share-based payment |
- |
- |
193 |
- |
- |
- |
193 |
- |
193 |
|||||||||
|
Shareholders' contribution |
- |
- |
- |
- |
- |
2,038 |
2,038 |
- |
2,038 |
|||||||||
|
Balance at 31 March 2009 (unaudited) |
1,036 |
359,803 |
8,273 |
(12,746) |
(53,158) |
2,617 |
305,825 |
25 |
305,850 |
|||||||||
|
Attributable to equity holders of the company |
|||||||||||||||||
|
Share |
Currency |
||||||||||||||||
|
Share |
Share |
based |
Retained |
translation |
Minority |
Total |
|||||||||||
|
capital |
premium |
payment |
earnings |
reserve |
Total |
interests |
equity |
||||||||||
|
U.S. dollars in thousands |
|||||||||||||||||
|
Balance at 1 January 2008 |
1,036 |
359,803 |
6,199 |
96,629 |
9,151 |
472,818 |
25 |
472,843 |
|||||||||
|
Comprehensive income |
- |
- |
- |
4,602 |
8,908 |
13,510 |
- |
13,510 |
|||||||||
|
Share-based payment |
- |
- |
483 |
- |
- |
483 |
- |
483 |
|||||||||
|
Balance at 31 March 2008 (unaudited) |
1,036 |
359,803 |
6,682 |
101,231 |
18,059 |
486,811 |
25 |
486,836 |
|||||||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
|
Attributable to equity holders of the Company |
|||||||||||||||||||
|
Share |
Earnings |
Currency |
|||||||||||||||||
|
Share |
Share |
based |
(accumulated |
translation |
Shareholders' |
Minority |
Total |
||||||||||||
|
capital |
premium |
payment |
deficit) |
reserve |
contributions |
Total |
interests |
equity |
|||||||||||
|
U.S. dollars in thousands |
|||||||||||||||||||
|
Balance at 1 January 2008 |
1,036 |
359,803 |
6,199 |
96,629 |
9,151 |
- |
472,818 |
25 |
472,843 |
||||||||||
|
Comprehensive loss |
- |
- |
- |
(104,831) |
(28,236) |
- |
(133,067) |
- |
(133,067) |
||||||||||
|
Share-based payment |
- |
- |
1,881 |
- |
- |
- |
1,881 |
- |
1,881 |
||||||||||
|
Shareholders' contribution |
- |
- |
- |
- |
- |
579 |
579 |
- |
579 |
||||||||||
|
Balance at 31 December 2008 |
1,036 |
359,803 |
8,080 |
(8,202) |
(19,085) |
579 |
342,211 |
25 |
342,236 |
||||||||||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
Three months ended 31 March |
Year ended 31 December |
|||||
|
2009 |
2008 |
2008 |
||||
|
Unaudited |
Audited |
|||||
|
U.S. dollars in thousands |
||||||
|
Cash flows from operating activities: |
||||||
|
Profit (loss) before taxes on income |
(2,548) |
6,748 |
(103,826) |
|||
|
Adjustments for: |
||||||
|
Finance costs |
20,474 |
3,822 |
44,725 |
|||
|
Interest paid |
(1,390) |
(1,653) |
(8,135) |
|||
|
Finance income |
(1,790) |
(14,050) |
(9,883) |
|||
|
Interest received |
403 |
804 |
3,156 |
|||
|
Fair value adjustments of investment properties |
(19,076) |
1,493 |
58,768 |
|||
|
Share-based payments |
193 |
483 |
1,881 |
|||
|
Additions to inventories of buildings under construction |
(4,695) |
(3,603) |
(64,466) |
|||
|
Depreciation |
97 |
149 |
343 |
|||
|
Decrease (increase) in trade and other receivables |
189 |
(5,465) |
(2,674) |
|||
|
Impairment of investment property under construction and residential projects for sale under construction |
- |
- |
4,289 |
|||
|
Increase (decrease) in accounts payable and accruals and in provision to service provider |
2,693 |
(2,104) |
1,380 |
|||
|
Write-down of advance on account of acquisition of subsidiary |
- |
- |
1,256 |
|||
|
Income taxes paid |
(300) |
(1,167) |
(1,909) |
|||
|
Net cash flows used in operating activities |
(5,750) |
(14,543) |
(75,095) |
|||
|
Cash flows from investing activities: |
||||||
|
Additions to fixed assets |
(143) |
(165) |
(679) |
|||
|
Additions to investment properties |
(395) |
(3,499) |
(29,206) |
|||
|
Additions to investment properties under construction |
(16,620) |
(9,374) |
(48,296) |
|||
|
Loans granted |
(2,876) |
(10,617) |
(47,408) |
|||
|
Advance on acquisition of subsidiary |
- |
(796) |
(600) |
|||
|
Loans repaid |
- |
- |
14,829 |
|||
|
Release of restricted deposits |
- |
- |
71,406 |
|||
|
Net cash flows used in investing activities |
(20,034) |
(24,451) |
(39,954) |
|||
|
Cash flows from financing activities: |
||||||
|
Accrued expenses on account of loan |
- |
(123) |
(1,500) |
|||
|
Proceeds from short-term loans |
11,003 |
- |
- |
|||
|
Repayments from short-term borrowings |
- |
(765) |
(12,433) |
|||
|
Proceeds from long-term borrowings from shareholders |
19,069 |
7,991 |
||||
|
Acquisition of minority |
- |
(757) |
- |
|||
|
Net cash flows provided by (used in) financing activities |
30,072 |
(1,645) |
(5,942) |
|||
|
Increase (decrease) in cash and cash equivalents |
4,288 |
(40,639) |
(120,991) |
|||
|
Net foreign exchange differences on cash and cash equivalents |
(5,316) |
480 |
13,055 |
|||
|
Cash and cash equivalents at beginning of period |
9,822 |
117,758 |
117,758 |
|||
|
Cash and cash equivalents at end of period |
8,794 |
77,599 |
9,822 |
|||
The accompanying notes are an integral part of the interim condensed consolidated financial statements.
NOTE 1:- GENERAL
These interim consolidated financial statements have been prepared in a condensed format as of 31 March 2009 and for the three-month period then ended ("interim condensed consolidated financial statements"). These financial statements should be read in conjunction with the Company's annual financial statements and accompanying notes as of 31 December 2008 and for the year then ended ("annual financial statements").
NOTE 2:- SEGMENTS
|
Commercial |
Residential |
Total |
||||
|
Unaudited |
||||||
|
Three months ended 31 March 2009: |
U.S. dollars in thousands |
|||||
|
Segment revenues |
4,246 |
- |
4,246 |
|||
|
Segment results |
19,378 |
(713) |
18,665 |
|||
|
Unallocated expenses |
(2,529) |
|||||
|
Finance costs |
(20,474) |
|||||
|
Finance income |
1,790 |
|||||
|
Loss before taxes on income |
(2,548) |
|||||
|
Commercial |
Residential |
Total |
||||
|
Unaudited |
||||||
|
Three months ended 31 March 2008: |
U.S. dollars in thousands |
|||||
|
Segment revenues |
4,505 |
- |
4,505 |
|||
|
Segment results |
(1,042) |
(265) |
(1,307) |
|||
|
Unallocated expenses |
(2,173) |
|||||
|
Net finance income |
10,228 |
|||||
|
Finance costs |
(3,822) |
|||||
|
Finance income |
14,050 |
|||||
|
Profit before taxes on income |
6,748 |
|||||
|
Commercial |
Residential |
Total |
||||
|
Audited |
||||||
|
Year ended 31 December 2008: |
U.S. dollars in thousands |
|||||
|
Segment revenues |
20,360 |
- |
20,360 |
|||
|
Segment results |
(59,150) |
(2,246) |
(61,396) |
|||
|
Unallocated expenses |
(7,588) |
|||||
|
Finance costs |
(44,725) |
|||||
|
Finance income |
9,883 |
|||||
|
Loss before taxes on income |
(103,826) |
|||||
NOTE 3:- SIGNIFICANT EVENTS DURING THE REPORTED PERIOD
During the period, the Company received loans from main shareholders (companies owned by the Fishman group) of approximately $ 19 million, repayable on 31 March 2010. Those loans bear an annual interest of 12%.
- - - - - - - - - - - - - - - - - - -
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