During the fourth quarter of 2016 Pro Kapital continued the construction works of the new T1 shopping and entertainment centre in Tallinn, which is the Company´s largest single-object development project. In November the financing agreement was signed with TSSP, a leading global credit platform of TPG, with approximately $19 billion in assets under management. The total volume of the financing agreement is 65 million euros to fully fund T1 shopping and entertainment centre project to be opened in October 2018. Active negotiations with several local and international retail operators were carried on. The Company continued development activities also in Kliversala residential quarter in Riga and residential development projects – Šaltinių Namai in Vilnius and Kristiine City in Tallinn, Tondi.
In Vilnius by the issuing of the present report 38 apartments out of 44 in building K4-1 have been handed over to the clients. In January 2017, after the reporting period the construction works for the 2nd stage residential buildings were started, and the signing of preliminary agreements based on 44 reservations has been initiated.
In Tallinn, Tondi quarter, the Company has completed three apartment buildings where 77 apartments out of 93 have been handed over to the clients. Presales continued also for the 4th building with 8 presale agreements signed and presales were launched also for building Marsi 6, historical building, that will be renovated into a special design loft apartments. The start has been successful with 24 presale agreements out of 45 flats signed. The construction works were completed for converting a historical barrack on Tondi 53 land plot into an office building where starting from 1 September the head office of the Company is located. On 1 November the architectural competition was launched for Kalasadam area with the deadline for entries on 1 February 2017. On 20 February 2017, after the reporting period, the winning project “Kesk-küla” was announced out from 11 submitted entries, the author of which is Kadarik Tüür Arhitektid OÜ.
In Riga, the construction works for the first residential building in Kliversala project were continued and 7 presale agreements have been signed out of 47 flats in total. The projecting works were continued also for Tallinas Residential Complex.
During the twelve months the Company completed two tranches of emission of bonds with the total issue price of 16 003 059 euros. The proceeds are mainly planned for the development projects of the Company.
At the end of reporting period the Company recorded net revenue of 20,7 million euros, increase of 13% as compared to 18,3 million euros in the same period in 2015. Revenues have increased mostly in real estate segment. This segment is influenced by completion of the buildings as revenues are recoded at the moment notary deed of sales is concluded. The net result remained negative due to high financial costs. Recorded net losses of 2,6 million euros for 2016 were 30% higher as compared to 2,0 million euros losses in the same period last year as a result of increased interest costs.
Net operating result during twelve months decreased by 0,06 million euros (4%) compared to the reference period, totalling to profit of 1,36 million euros (2015 12 months profit of 1,42 million euros). Net operating result for the fourth quarter was profit of 0,8 million euros (2015 Q4: profit of 2,3 million euros). Net result for the fourth quarter was loss of 0,2 million euros (2015 Q4: profit of 0,8 million euros).
| Key financial figures | ||||
| 2016 12M | 2015 12M | 2016 Q4 | 2015 Q4 | |
| Revenue, th EUR | 20 652 | 18 322 | 4 475 | 5 411 |
| Gross profit, th EUR | 6 054 | 4 448 | 1 424 | 1 121 |
| Gross profit, % | 29% | 24% | 32% | 21% |
| Operating result, th EUR | 1 361 | 1 424 | 798 | 2 330 |
| Operating result, % | 7% | 8% | 18% | 43% |
| Net result, th EUR | -2 605 | -2 010 | -235 | 823 |
| Net result, % | -13% | -11% | -5% | 15% |
| Earnings per share, EUR | -0,05 | -0,04 | 0 | 0,02 |
| 31.12.2016 | 31.12.2015 | |||
| Total Assets, th EUR | 143 984 | 130 323 | ||
| Total Liabilities, th EUR | 62 360 | 46 891 | ||
| Total Equity, th EUR | 81 624 | 83 432 | ||
| Debt/ Equity | 0,76 | 0,56 | ||
| Return on Assets, % | -1,9% | -1,5% | ||
| Return on Equity, % | -3,2% | -2,4% | ||
| Net asset value per share, EUR | 1,51 | 1,54 |
| Consolidated interim statements of financial position | ||||
| in thousands of euros | 31.12.2016 | 31.12.2015 | ||
| ASSETS | ||||
| Current Assets | ||||
| Cash and cash equivalents | 5 382 | 6 392 | ||
| Current receivables | 4 475 | 1 608 | ||
| Inventories | 14 144 | 12 438 | ||
| Total Current Assets | 24 001 | 20 438 | ||
| Non-Current Assets | ||||
| Non-current receivables | 42 | 48 | ||
| Property, plant and equipment | 18 226 | 17 103 | ||
| Investment property | 101 440 | 92 457 | ||
| Intangible assets | 275 | 277 | ||
| Total Non-Current Assets | 119 983 | 109 885 | ||
| TOTAL ASSETS | 143 984 | 130 323 | ||
| in thousands of euros | 31.12.2016 | 31.12.2015 | ||
| LIABILITIES AND EQUITY | ||||
| Current Liabilities | ||||
| Current debt | 8 261 | 8 004 | ||
| Customer advances | 2 226 | 1 692 | ||
| Current payables | 8 502 | 5 103 | ||
| Taxes payable | 547 | 264 | ||
| Short-term provisions | 5 | 87 | ||
| Total Current Liabilities | 19 541 | 15 150 | ||
| Non-Current Liabilities | ||||
| Long-term debt | 38 040 | 27 054 | ||
| Other long-term liabilities | 804 | 837 | ||
| Deferred income tax liability | 3 610 | 3 503 | ||
| Long-term provisions | 365 | 347 | ||
| Total Non-Current Liabilities | 42 819 | 31 741 | ||
| TOTAL LIABILITIES | 62 360 | 46 891 | ||
| Equity attributable to equity holders of the parent | ||||
| Share capital in nominal value | 10 854 | 10 841 | ||
| Paid in capital | 1 816 | 1 669 | ||
| Statutory reserve | 1 082 | 1 082 | ||
| Revaluation reserve | 9 462 | 9 462 | ||
| Retained earnings | 59 104 | 60 677 | ||
| Profit (loss) for the period | -2 493 | -1 934 | ||
| Total equity attributable to equity holders of the parent | 79 825 | 81 797 | ||
| Non-controlling interest | 1 799 | 1 635 | ||
| TOTAL EQUITY | 81 624 | 83 432 | ||
| TOTAL LIABILITIES AND EQUITY | 143 984 | 130 323 | ||
| Consolidated interim statements of comprehensive income | ||||
| in thousands of euros | 2016 12M | 2015 12M | 2016 Q4 | 2015 Q4 |
| Operating income | ||||
| Revenue | 20 652 | 18 322 | 4 475 | 5 411 |
| Cost of goods sold | -14 598 | -13 874 | -3 051 | -4 290 |
| Gross profit | 6 054 | 4 448 | 1 424 | 1 121 |
| Marketing expenses | -518 | -466 | -175 | -52 |
| Administrative expenses | -5 396 | -5 250 | -1 543 | -1 495 |
| Other income | 1 437 | 3 353 | 1 237 | 3 149 |
| Other expenses | -216 | -661 | -145 | -393 |
| Operating profit/ loss | 1 361 | 1 424 | 798 | 2 330 |
| Financial income | 13 | 13 | 8 | 2 |
| Financial expense | -3 512 | -2 606 | -792 | -684 |
| Loss before income tax | -2 138 | -1 169 | 14 | 1 648 |
| Income tax | -467 | -841 | -249 | -825 |
| Net loss for the period | -2 605 | -2 010 | -235 | 823 |
| Other comprehensive income, net of income tax | ||||
| Items that may be classified subsequently to profit or loss | ||||
| Exchange differences on translating foreign operations* | 0 | 143 | 0 | 143 |
| Items that will not be classified subsequently to profit or loss | ||||
| Net change in properties revaluation reserve | 0 | 73 | 0 | 73 |
| Total comprehensive income for the year | -2 605 | -1 794 | -235 | 1 039 |
| Equity holders of the parent | -2 315 | -2 935 | 802 | -1 232 |
| Non-controlling interest | -55 | 102 | -23 | -21 |
| Earnings per share (EUR) | -0,04 | -0,05 | 0,01 | -0,02 |
| Diluted earnings per share (EUR) | -0,04 | -0,05 | 0,01 | -0,02 |
| *Due to Lithuania entering into Eurozone on 01.01.2015, the Company has considered currency exchange differences realised and accordingly written off currency exchange differences in amount 143 thousand euros at the end of 2015. |
| Consolidated interim statements of cash flows | |||||
| in thousands of euros | 2016 12M | 2015 12M | 2016 Q4 | 2015 Q4 | |
| Cash flows from operating activities | |||||
| Loss for the year | -2 605 | -2 010 | -235 | 823 | |
| Adjustments for: | |||||
| Depreciation and amortisation of non-current assets | 695 | 693 | 166 | 189 | |
| Change in fair value of investment property | 140 | -44 | 140 | -44 | |
| Gain from sale of non-current assets | -4 | 0 | -4 | 0 | |
| Change in fair value of investment property | -1 181 | -3 041 | -1 181 | -3 247 | |
| Finance income and costs | 3 499 | 2 593 | 784 | 682 | |
| Other non-monetary changes (net amounts) | 551 | 645 | 602 | 416 | |
| Changes in working capital: | |||||
| Trade receivables and prepayments | -2 862 | 957 | -2 999 | -427 | |
| Inventories | -1 707 | 2 097 | -4 329 | 160 | |
| Liabilities and prepayments | 4 185 | 1 330 | 5 102 | 2 692 | |
| Provisions | -64 | 278 | -74 | -68 | |
| Net cash from operating activities | 647 | 3 498 | -2 028 | 1 176 | |
| Cash flows from investing activities | |||||
| Payments for property, plant and equipment | -1 206 | -55 | -520 | -5 | |
| Payments for intangible assets | -2 | -13 | -1 | 0 | |
| Payments for investment property | -8 552 | -1 306 | -2 893 | -1 100 | |
| Proceeds from sales of non-current assets | 7 | 0 | 7 | 0 | |
| Payments for shares of subsidiaries | -911 | 0 | -550 | 0 | |
| Interests received | 13 | 6 | 9 | 2 | |
| Net cash from investing activities | -10 651 | -1 368 | -4 309 | -1 103 | |
| Cash flows from financing activities | |||||
| Proceeds from increase of share capital | 0 | 214 | 0 | 214 | |
| Proceeds from changes in non-controlling interests | 1 187 | 153 | 0 | 153 | |
| Proceeds from issue of bonds | 12 637 | 7 652 | 0 | 0 | |
| Redemption of convertible bonds | -122 | -62 | -110 | 0 | |
| Redemption of non-convertible bonds | -1 000 | 0 | -1 000 | 0 | |
| Proceeds from borrowings | 2 961 | 3 673 | 936 | 865 | |
| Repayment of borrowings | -3 310 | -6 794 | -556 | -2 575 | |
| Interests paid | -3 359 | -2 455 | -1 126 | -582 | |
| Net cash from financing activities | 8 994 | 2 381 | -1 495 | -1 925 | |
| Net change in cash and cash equivalents | -1 010 | 4 511 | -7 832 | -1 852 | |
| Cash and cash equivalents at the beginning of the period | 6 392 | 1 881 | 13 214 | 8 244 | |
| Cash and cash equivalents at the end of the period | 5 382 | 6 392 | 5 382 | 6 392 | |
Allan Remmelkoor Member of the Management Board Tel.: +372 6144 920 Email: prokapital@prokapital.ee
