MIDI plc - Interim Results

Tuesday, August 29th, 2017

On 28 August, MIDI plc published its condensed interim financial statements covering the six-month period ended 30 June 2017.

Performance Overview

During the period under review, MIDI registered a 52.3% drop in turnover to €1.87 million, reflecting the lack of apartments available for delivery to their respective owners. In fact, most of the revenues generated during the first six months of this current financial year ending 31 December 2017 were generated from property and rental management whilst only €0.18 million (or 9.9% of total revenues) were generated from development and sale of property.

Cost of sales and other operating and administrative expenses were also lower when compared to the previous comparable period as they dropped by nearly 36% to €2.21 million (H1 2016: €3.44 million). Nonetheless, MIDI still reported an operating loss of €0.34 million from an operating profit of €0.47 million registered in the first half of FY2016.

Despite the overall increase in borrowings, net finance costs dropped by 27.8% to €1.16 million (H1 2016: €1.61 million), partly reflecting the coupon rate differential between the 7% bonds redeemed on 15 December 2016 and the new 4% secured bonds issued last year.

Overall, MIDI posted a pre-tax loss of €1.51 million compared to a pre-tax loss of €1.14 million in the first half of 2016. After taking into account a tax charge of €0.16 million (H1 2016: tax credit of €0.28 million), the Group made a net loss of €1.66 million compared to a net loss of €0.86 million in the first six months of FY2016.

The Condensed Statement of Financial Position as at 30 June 2017 shows a marginal increase of 0.7% in total assets to €205.2 million when compared to the corresponding figure as at 31 December 2016. The growth in assets is largely due to the 5.7% (or €7.22 million) increase in “Inventories – Development project” to €134.3 million whilst “Other current assets” dropped by 28.4% (or €5.83 million) to €14.7 million, reflecting the further progress made on the development of the Q2 residential block. On the other hand, total liabilities increased by 2.3% (or €3.13 million) to €139.5 million mainly reflecting the 1.55% increase (or €1.18 million) in aggregate “Trade and other payables” and the €1.95 million addition in borrowings. Accordingly, the Group’s equity base contracted by 2.5% (or €1.67 million) to €65.7 million largely reflecting the loss registered during the period under review. This translates into a net asset value of €0.3067 (31 December 2016: €0.3145).

Current Material Events & Outlook    

The Directors explained that MIDI is currently undergoing the continued development of the Q2 residential block which is expected to be completed in the first half of 2018. Meanwhile, the Company launched a second tranche of the Q2 apartments on the market and most of these apartments have already been subject to a promise of sale agreement. As such, MIDI is anticipating that all of the Q2 apartments will be handed over to their respective owners during 2018 and hence profits generated from such sales are expected to be registered in the Company’s financial statements ending 31 December 2018.

With respect to MIDI’s 50% shareholding in Mid Knight Holdings – the company currently developing “The Centre” office block – the Group noted that development works are now approaching completion with commencement of rental operations earmarked for Q4 2017. Following the sale of one whole floor, MIDI noted that all of the remaining floors are now practically rented out.

MIDI also made reference to the Manoel Island project and the previous company announcements providing updates in this respect. In particular, MIDI reiterated the engagement of PwC Global Strategy& as end-to-end international strategy consultant, Foster + Partners for the creation of a conceptual masterplan, as well as Jefferies International Limited as financial adviser for the purposes of identifying and selecting a suitable partner to financially support the development of Manoel Island.

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MIDI plc – Interim financial statements covering the six months ended 30 June 2017.

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