On 11 March 2021, Malita Investments plc published the Annual Report and Financial Statements for the year ended 31 December 2020.
During 2020, Malita Investments plc generated record revenues of €8.75 million, representing an increase of 5% when compared to the previous corresponding period. The increase in revenue was driven by the first full year increase in ground rent receivable from the Valletta Cruise Port (“VCP”) which was increased in November 2019 as per contractual review as well as contractual increases by the index of inflation in lease payments for the Open Air Theatre and Parliament Building in Valletta.
On the expenditure side, administrative expenses surged by 55.0% to €0.63 million, largely reflecting an increase in professional fees and employee benefit expenses. Meanwhile, net finance costs declined by 2.4% to €1.23 million following a reduction in loan interest expense which outweighed the increase in bank charges and fees as well as finance costs on lease liability and restoration provisions. On the other hand, finance income being derived from the accounting treatment of the agreement made with the Housing Authority with respect to the Affordable House project remained relatively unchanged at €0.42 million (2019: €0.43 million).
Malita’s 2020 financial performance was impacted by the significantly lower incidence of positive fair value movements of investment properties as these amounted to €4.6 million when compared to €34.7 million in the previous year. In fact, during 2020 the Malta International Airport (“MIA”) and VCP properties experienced a fair value loss of €1.4 million to €102.7 million whilst the Parliament Building and Open Air Theatre’s fair value rose by an additional €6.0 million to €125.3 million. The negative fair value movement for MIA and VCP properties came about due to the upward movement of interest rates whereas for the Parliament Building and Open Air Theatre, the upward movement of interest rates was offset by the changes in the contractual cash flows owing to the passage of time.
Overall, Malita registered a pre-tax profit of €11.5 million (2019: €41.3 million). After accounting for a tax charge of €2.0 million, the net profit for the year amounted to €9.5 million (2019: €37.1 million).
The Statement of Financial Position shows that total assets increased by 6.0% to €248.5 million, mainly emanating from a €9.1 million increase in the value of capitalised costs to €18.9 million which are related to the Affordable Housing project as well as a €4.6 million increase to €228.0 million in the fair value of the company’s investment properties. Similarly, total liabilities grew by 11.4% to €84.0 million largely reflecting increases in borrowings, trade and other payables and ‘capital credit for the acquisition of property’ which now amounts to €3.0 million and is due within the coming year. Furthermore, the company’s net debt increased by 7.7% to €48.9 million compared to €45.5 million as at the end of 2019. Meanwhile, total equity increased by 3.5% to €164.5 million (31 December 2019: €159.0 million). This translates into a net asset value per share of €1.1107 (31 December 2019: €1.0734 per share).
The Directors are recommending the payment of a final net dividend of €0.0142 per share to all shareholders as at the close of trading on Wednesday 7 April 2021. The final dividend will be paid on Tuesday 18 May 2021 subject to shareholders’ approval at the upcoming Annual General Meeting scheduled to be held on Tuesday 11 May 2021.
Coupled with the interim net dividend of €0.0086 per share, the total net dividend for the 2020 financial year amounts to €0.0228 per share. This is 15.9% lower than the total net dividend per share of €0.02711 paid for in the 2019 financial year.