GlobalCapital plc - Interim Results

Friday, August 28th, 2015

On 28 August, GlobalCapital plc published its interim results covering the six months ended 30 June 2015.

Performance Overview

During the period under review, the Group registered a pre-tax profit of €1.2 million representing a significant turnaround from the €0.97 million pre-tax loss incurred in the first six months of 2014. The turnaround is largely attributable to the improvement in the performance of the life insurance subsidiary on the back of increased premiums, cost cutting measures implemented in the latter part of 2014 as well as fair value gains which were only partially offset by a write down on the Group’s investment in Bramer Bank totalling €0.94 million (given that the Bank’s licence was revoked by the Financial Services Commission in Mauritius). Additionally, the Group’s investment division, health insurance agency and rental property portfolio registered marginal growth.

After accounting for a tax charge of €0.7 million, the Group’s net profit for the period under review amounted to €0.48 million compared to the €1 million loss incurred during the first six months of 2014. This translates into an earnings per share of €0.037 [H1 2014: €(0.078)].

The Statement of Financial Position as at 30 June 2015, show a 3% increase in total assets compared with the corresponding figures as at 31 December 2014 largely reflecting the growth in other investments and cash balances which offset the decline in investment property. Total liabilities also increased by 2.6% to €88.6 million mainly due to higher technical provisions. Overall, the Group’s equity base grew by 15.4% to €3.65 million following the profit registered during the period under review. This translates into a net asset value per share of €0.2762 (Dec 14: €0.15).

Share Purchase Agreement

During the period under review, the Financial Services Commission in Mauritius appointed Conservators for BAI Co (Mtius) Ltd which holds 48.45% of the Ordinary Shares of GlobalCapital plc. In early May 2015, a conditional offer was made by EIP plc, a Malta registered company, to acquire the entire shareholding held by BAI Co (Mtius) Ltd. In mid-July 2015, EIP plc and the Conservator entered into a share purchase agreement for the transfer of the 48.45% shareholding subject to certain conditions which the Directors understand are usual in such transactions. As a result of these developments, the present reconstituted Board has reversed the prior Board decision to divest of the Group’s investment and advisory function, having been informed that it is the intention of the prospective shareholder to expand the investment operation both locally and in other European countries.

Upcoming Annual General Meeting & Rights Issue

The Company’s bond is due for repayment at the latest by 2 June 2016. The Company intends to finance this bond repayment from the injection of fresh capital through a rights issue which is intended to at least raise €15 million. Shareholder approval will be sought at the forthcoming Annual General Meeting (AGM) during which shareholders will also be asked to authorise the Company to furnish EIP plc and BAI Co (Mtius) Ltd with any information required. Should the abovementioned share purchase agreement be fullfilled, EIP plc has committed itself to take up its pro-rata share in the said rights issue such that a minimum equity investment of €14 million be secured. The Board expects such a public offering to be made between December 2015 and January 2016.

Download

GlobalCapital plc – Half-Year Report for the period ended 30 June 2015.

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