MIDI plc - Full-Year Results

Tuesday, April 24th, 2018

On 23 April 2018, MIDI plc published the financial statements for the year ended 31 December 2017.

Performance Overview

In 2017, MIDI generated €4.64 million in revenues. This is significantly lower than the €8.67 million figure in 2016 as the company did not have any apartments available for delivery to prospective owners. Moreover, the drop in revenues did not translate into a similar decrease in costs. In fact, total operating costs (excluding depreciation) climbed by 17.4% to €6.98 million (FY2016: €5.95 million), largely reflecting an impairment charge of €1 million related to the value of MIDI’s 100%-owned subsidiary Solution & Infrastructure Services Limited. Excluding this impairment charge, operating costs were virtually flat. On the other hand, during 2017 MIDI reported other operating income of €0.13 million compared to other operating costs of €0.52 million in the previous comparable period. Overall, MIDI reported a negative EBITDA of €2.21 million (FY2016: +€2.2 million).

The depreciation charge for 2017 was unchanged at €0.57 million. In contrast, net finance costs dropped by nearly 40% to €2.25 million (FY2016: €3.73 million), largely reflecting savings related to the coupon rate differential between the bonds redeemed in 2016 and the new bonds maturing in 2026. Moreover, the 2017 financial results of MIDI were positively impacted by a €26.3 million contribution from Mid Knight Holdings Limited (“MKH”) in which MIDI has a 50% stake. MKH is the owner of “The Centre” business block. This contribution also reflects a revaluation of “The Centre” to €95 million compared to a value of €35.4 million as at the end of 2016.

MIDI plc reported a pre-tax profit of €21.2 million in contrast to a pre-tax loss of €2.11 million reported in the previous year. After accounting for a tax charge of €0.47 million, the net profit for the year amounted to €20.8 million. This translates into an earnings per share of €0.097.

The Statement of Financial Position as at 31 December 2017 shows a 15.5% increase in total assets to €235.3 million, largely reflecting the significant uplift in the value of the investment in MKH to €28.2 million (31 December 2016: €1.96 million) as well as the increase in the value of inventories in line with the progress registered in the construction of the “Q2” residential block. On the other hand, cash balances dropped by just over €4 million to €10.1 million.

Total liabilities grew by nearly 9% to €148.7 million, reflecting a 9.4% increase in total borrowings to €66.1 million as well as an 8.4% uplift in trade and other payables which, in turn, include additional amounts of deposits pertaining to the sale of “Q2” apartments. Overall, shareholders’ funds surged by 28.6% to €86.6 million. This translates into a net asset value per share of €0.404 compared to €0.315 as at the end of the 2016 financial year.

Dividend

The Directors recommended an unchanged final net dividend of €0.007 per share to all shareholders as at the close of trading on Thursday 24 May 2018. Subject to shareholders’ approval at the upcoming Annual General Meeting scheduled to be held on Wednesday 27 June 2018, the dividend will be paid by not later than Friday 13 July 2018.

Outlook

Looking ahead, MIDI noted that the remaining apartments forming part of the “Q2” residential block will now be launched on the market during the second quarter of this year. Furthermore, most of the “Q2” apartments will be delivered to their respective prospective owners in 2018. Accordingly, the profits generated from such sales will be accounted for in the financial statements of the current financial year ending 31 December 2018.

With respect to the Manoel Island project, MIDI is now targeting to commence preparatory works towards the end of 2018, with development works commencing during the first half of 2019.

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MIDI plc – Financial Statements for the year ended 31 December 2017.

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