Tumas Investments plc - Updated Financial Analysis Summary

On 30 June 2021, Tumas Investments plc published an updated Financial Analysis Summary (“FAS”) providing an overview of the company’s and the guarantor’s (namely Spinola Development Company Ltd) financial results in 2020, a comparison of the 2020 actual results with the forecasts published in the previous FAS dated 19 August 2020, as well as the forecasts for the current financial year ending 31 December 2021.

The following are the main highlights of the expected financial performance and position of Spinola Development Company Ltd in 2021:

  • Revenues are expected to ease by 2.5% to €33.4 million as the decline in revenue generated from the ‘Property Development’ division (reflecting the lower amount of units available for sale) is projected to slightly outweigh the improved performances in the ‘Hotel and Ancillary Operations’ and ‘Complex Management’ segments.
  • Given the sharp increase in direct costs and administrative expenses to €23.6 million (2020 €15.4 million), EBITDA is expected to deteriorate to €9.8 million from €18.9 million in 2020.
  • Depreciation costs are expected to increase by 3.4% to €6.4 million whilst net finance costs are forecasted to remain unchanged at €2.3 million.
  • After accounting for a tax charge of €0.4 million (2020: €0.8 million tax credit), profit after tax is projected to amount to €0.7 million (2020: €11.2 million).
  • Total borrowings are expected to increase by 6.9% to €58.1 million. Similarly, net debt is anticipated to rise to €42.8 million (31 December 2020: €29.4 million) reflecting the considerable forecasted drop in cash reserves to €15.4 million (31 December 2020: €25 million).
  • The gearing ratio (calculated as total debt divided by total debt plus equity) is anticipated to increase slightly to 29.8% (31 December 2020: 28.8%). Meanwhile, given the expected drop in EBITDA, coupled with the surge in net debt, the net debt to EBITDA multiple is forecasted to deteriorate to 4.4 times compared to 1.6 times in the 2020 financial year. Likewise, the interest cover is expected to weaken to 4.2 times compared to 8.2 times in 2020.

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Tumas Investments plc – Financial Analysis Summary dated 30 June 2021.

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