CONSOLIDATED INTERIM REPORT FOR IV QUARTER AND 12

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 2^nd 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 4^th 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).

         Allan Remmelkoor          Member of the Management Board          Tel.: +372 6144 920          Email: prokapital@prokapital.ee