DEVELIA S.A. Develia S.A.
CONDENSED INTERIM FINANCIAL STATEMENTS
FOR THE PERIOD OF SIX MONTHS ENDED 30 June 2020
WITH THE STATUTORY AUDITOR'S REPORT
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
TABLE OF CONTENTS
Condensed interim statement of financial position………………………………………………………………………. | 4 | |
Condensed interim statement of comprehensive income………………………………………………………………. | 5 | |
Condensed interim statement of cash flows……………………………………………………………………………… | 6 | |
Condensed interim statement of changes in equity……………………………………………………………………… | 7 | |
Accounting principles (policies) and Additional explanatory notes…………………………………………………….. | 9 | |
Non-current investments .............................................................................................................................................. | ||
Non-current loans and receivables.............................................................................................................................. |
Accounting principles (policies) and Additional explanatory notes to the Financial Statements presented on pages 8 to 40 are an
integral part hereof
2
Develia S.A. | ||
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 | ||
(PLN '000) | ||
Effects of Announcement of COVID-19 Epidemic on Group's Current Operations ................................................. | ||
Accounting principles (policies) and Additional explanatory notes to the Financial Statements presented on pages 8 to 40 are an
integral part hereof
3
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
CONDENSED INTERIM STATEMENT OF FINANCIAL POSITION
as at 30 June 2020 (PLN'000)
30 June 2020 | 31 December 2019 | |||
Note | (audited) | (audited) | ||
Assets | ||||
A. Fixed assets | 1,068,806 | 1,029,519 | ||
1. | Intangible assets | 285 | 282 | |
2. | Property, plant and equipment | 11 | 5,330 | 6,145 |
2.1. Tangible assets | 5,324 | 6,099 | ||
2.2. Tangible assets under construction | 6 | 46 | ||
3. | Non-current loans and receivables | 13 | 109,371 | 75,177 |
4. | Non-current investments | 12 | 953,820 | 947,499 |
5. | Non-current prepayments and accrued income | 0 | 416 | |
6. | Deferred tax assets | 10.3 | 0 | 0 |
B. Current assets | 956,946 | 699,019 | ||
1. | Inventory | 15 | 665,578 | 542,904 |
2. | Trade and other receivables | 16 | 24,612 | 98,504 |
3. | Income tax receivable | 3,802 | 3,719 | |
4. | Current financial assets | 14 | 25,071 | 24,157 |
5. | Cash and cash equivalents | 17 | 235,987 | 28,821 |
6. | Current prepayments and accrued income | 1,896 | 914 | |
C. Non-current assets classified as held for sale | 0 | 0 | ||
Total assets | 2,025,752 | 1,728,538 | ||
Equity and liabilities | ||||
A. Equity | 1,175,315 | 948,279 | ||
1. | Share capital | 18.1 | 447,558 | 447,558 |
2. | Called-up share capital not paid | 0 | 0 | |
3. | Supplementary capital | 18.2 | 322,216 | 322,216 |
4. | Other reserve funds | 18.3 | 0 | 0 |
5. | Other capital | 18.4 | 2,237 | 2,237 |
6. | Retained profit/(Loss carried forward) | 403,304 | 176,268 | |
B. Non-current liabilities | 430,620 | 534,361 | ||
1. | Non-current financial liabilities | 19.1 | 411,635 | 514,150 |
2. Non-current lease liabilities | 2,414 | 2,744 | ||
3. | Provisions | 20 | 19 | 19 |
4. | Deferred tax liability | 10.3 | 16,552 | 17,448 |
C. Current liabilities | 419,817 | 245,898 | ||
1. | Current financial liabilities | 19.1 | 182,622 | 103,221 |
2. Current lease liabilities | 11,107 | 11,061 | ||
3. | Current liabilities on account of acquisition of subsidiary | 0 | 0 | |
4. | Trade and other payables | 38,877 | 34,996 | |
5. | Income tax payables | 0 | 0 | |
6. | Provisions | 20 | 0 | 0 |
7. Accruals and deferred income | 187,211 | 96,620 | ||
Total equity and liabilities | 2,025,752 | 1,728,538 | ||
Accounting principles (policies) and Additional explanatory notes to the Financial Statements presented on pages 8 to 40 are an
integral part hereof
4
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
CONDENSED INTERIM STATEMENT OF COMPREHENSIVE INCOME
for the period of 6 months ended 30 June 2020 (PLN '000)
Note | Period of 6 months | Period of 6 months | ||
ended | ended | |||
30 June 2020 | 30 June 2019 | |||
(audited) | (unaudited, restated) | |||
Revenues | ||||
Revenue from sale of services, products and goods | 8,745 | 13,587 | ||
Revenue from interest and discounts | 2,402 | 5,633 | ||
Revenue from dividend | 235,559 | 119,078 | ||
Other financial income | 6,399 | 4 | ||
Other operating income | 357 | 11 | ||
Total operating income | 253,462 | 138,313 | ||
Expenses | ||||
Operating expenses, | ||||
value of products, goods sold | (21,524) | (23,995) | ||
Costs of interest and discounts | (5,302) | (10,055) | ||
Other financial expenses | (426) | (2,144) | ||
Other operating expenses | (70) | (802) | ||
Total operating expenses | (27,322) | (36,996) | ||
Pre-tax profit (loss) | 226,140 | 101,317 | ||
Income Tax | 10.1 | 896 | 246 | |
Net profit (loss) on continued operations | 227,036 | 101,563 | ||
Discontinued operations | ||||
Profit (loss) on discontinued operations in the financial year | 0 | 0 | ||
Net profit/(loss) | 227,036 | 101,563 | ||
Other comprehensive income | ||||
Other components of comprehensive income | 0 | 0 | ||
Income tax relating to other components of comprehensive income | 0 | 0 | ||
Other comprehensive income (net) | 0 | 0 | ||
Total comprehensive income | 227,036 | 101,563 | ||
Profit/(loss) per share | ||||
- basic EPS from the profit/(loss) for the period (PLN) | 0.51 | 0.23 | ||
- diluted EPS from the profit/(loss) for the period (PLN) | 0.51 | 0.23 | ||
Accounting principles (policies) and Additional explanatory notes to the Financial Statements presented on pages 8 to 40 are an
integral part hereof
5
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
CONDENSED INTERIM STATEMENT OF CASH FLOWS
for the period of 6 months ended 30 June 2020 (PLN '000)
Period of 6 months | Period of 6 months | ||
ended | ended | ||
30 June 2020 | 30 June 2019 | ||
Note | (audited) | (unaudited, restated) | |
A. Cash flows from operating activities | |||
I. Gross profit (loss) on continued operations | 226,140 | 101,317 | |
II. Total adjustments | 20,967 | (35,770) | |
1. Change in tangible assets and intangible assets | 812 | (7,556) | |
2. | Change in provisions | 0 | 19 |
3. | Change in inventories | (122,674) | (101,783) |
4. | Change in receivables | 73,892 | (11,200) |
5. Change in current liabilities (net of loans and borrowings) | 3,881 | 127,760 | |
6. | Change in accruals and deferrals | 90,024 | 5,997 |
7. | Change in financial liabilities | 15,520 | (85,777) |
8. Change in financial assets resulting from borrowings and notes | (34,480) | 24,185 | |
9. | Change in financial assets resulting from shares | (6,321) | 266 |
10. Income Tax | (82) | (280) | |
11. Other adjustments | 395 | 12,600 | |
III. Net cash flow from operating activities (l±ll) | 247,107 | 65,547 | |
B. Cash flows from financing activities | |||
l. Cash inflows | 123,656 | 60,000 | |
1. | Net proceeds from issue of shares and additional | 0 | |
contributions to equity | 0 | ||
2. Issue of debt securities | 0 | 60,000 | |
3. Loans and borrowings | 123,656 | 0 | |
II. Outflows | (163,597) | (63,270) | |
1. | Acquisition of own (treasury) shares | 0 | 0 |
2. | Redemption of debt securities | (65,000) | (50,000) |
3. | Lease repayment | (1,143) | (1,172) |
4. | Repayment of loans and borrowings | (85,200) | 0 |
5. | Interest | (12,254) | (12,098) |
6. | Other financial expenses | 0 | 0 |
III. Net cash flows from financing activities (l-ll) | (39,941) | (3,270) | |
C. Total net cash flow (A.III±B.III) | 207,166 | 62,277 | |
D. Balance-sheet change in cash, including: | 207,166 | 62,277 |
- change in the position of cash on account of foreign exchange
differences | 0 | ||
E. Cash at beginning of period | 28,821 | 120,119 | |
F. Cash at end of period (F±D) | 17 | 235,987 | 182,396 |
- restricted cash | 20 | 20 |
Accounting principles (policies) and Additional explanatory notes to the Financial Statements presented on pages 8 to 40 are an
integral part hereof
6
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
CONDENSED INTERIM STATEMENT OF CHANGES IN EQUITY
for the period of 6 months ended 30 June 2020 (PLN '000)
Note | Share capital | Called-up share | Supplementary | Other reserve | Other capital | Retained profit/(Loss | Total | ||
capital not paid | capital | funds | carried forward) | ||||||
As at 01 January 2019 | 447,558 | 0 | 322,216 | 0 | 2,237 | 176,268 | 948,279 | ||
Net profit for the period of 6 months ended | |||||||||
30 June 2020 | 0 | 0 | 0 | 0 | 0 | 227,036 | 227,036 | ||
Other comprehensive income for the period of 6 months | |||||||||
ended 30 June 2020 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||
Total comprehensive income for the period of 6 | |||||||||
months | |||||||||
ended 30 June 2020 | 0 | 0 | 0 | 0 | 0 | 227,036 | 227,036 | ||
Allocated to the payment of dividend | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||
As at 30 June 2020 (audited) | 447,558 | 0 | 322,216 | 0 | 2,237 | 403,304 | 1,175,315 | ||
Note | Share capital | Called-up share | Supplementary | Other reserve | Other capital | Retained profit/(Loss | Total | ||
capital not paid | capital | funds | carried forward) | ||||||
As at 01 January 2019 | 447,558 | 0 | 324,396 | 0 | 2,273 | 118,661 | 892,888 | ||
Net profit for 2019 | 0 | 0 | 0 | 0 | 0 | 176,268 | 176,268 | ||
Other comprehensive income for 2019 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||
Total comprehensive income for 2019 | 0 | 0 | 0 | 0 | 0 | 176,268 | 176,268 | ||
Settlement of company merger*) | 0 | 0 | 0 | 0 | (36) | 0 | (36) | ||
Payment of dividend | 0 | 0 | (2,180) | 0 | 0 | (118,661) | (120,841) | ||
As at 31 December 2019 (audited) | 447,558 | 0 | 322,216 | 0 | 2,237 | 176,268 | 948,279 |
Accounting principles (policies) and Additional explanatory notes to the Financial Statements presented on pages 8 to 40 are an integral part hereof
7
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
*) Relates to the merger between Develia S.A. and LC Corp Invest XX Sp. z o.o. See Note 4 below for further details.
Share capital | Called-up share | Supplementary | Other reserve | Other capital | Retained | Total | |
capital not paid | capital | funds | profit/(Loss | ||||
carried forward) | |||||||
As at 01 January 2019 | 447,558 | 0 | 324,396 | 0 | 2,273 | 118,661 | 892,888 |
Net profit for the period of 6 months ended | |||||||
30 June 2019 | 0 | 0 | 0 | 0 | 0 | 101,564 | 101,564 |
Other comprehensive income for the period of 6 months | |||||||
ended 30 June 2019 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Total comprehensive income for the period of 6 months | |||||||
ended 30 June 2019 | 0 | 0 | 0 | 0 | 0 | 101,564 | 101,564 |
Settlement of company merger*) | 0 | 0 | 0 | 0 | (36) | (36) | |
Allocated to the payment of dividend | 0 | 0 | (2,180) | 0 | 0 | (118,661) | (120,841) |
As at 30 June 2019 (unaudited, restated) | 447,558 | 0 | 322,216 | 0 | 2,237 | 101,564 | 873,575 |
Accounting principles (policies) and Additional explanatory notes to the Financial Statements presented on pages 8 to 40 are an integral part hereof
8
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
ACCOUNTING PRINCIPLES (POLICIES) AND ADDITIONAL EXPLANATORY NOTES
1. General Information
Develia S.A. (the "Issuer", the "Company", formerly known as LC Corp S.A.) was established by the Notarial Deed dated 3 March 2006. The Company's registered office is situated in Wrocław, Poland, at ul. Powstańców Śląskich 2-4. The Company has been entered into the register of entrepreneurs of the National Court Register maintained by the District Court for Wrocław-Fabryczna in Wrocław, 4th Commercial Division of the National Court Register, under KRS No. 0000253077.
As at 30 June 2020, the shares of Develia S.A. are in public trading.
The Company has been assigned statistical identification number (REGON): 020246398, tax identification
number (NIP): 8992562750.
The Company has been established for an indefinite time. The Company's primary activity includes:
- PKD 6420Z Activities of financial holding companies
- PKD 4110Z Completion of construction projects related to putting up buildings
- PKD 6810Z Buying and selling of own real estate
- PKD 4120Z Construction works related to the completion of residential and non-residential buildings.
There was no parent undertaking of Develia S.A. as at 30 June 2020 and the date of signing these financial statements.
2. Identification of Condensed Interim Financial Statements
These Condensed Interim Financial Statements of the Company concerning the period of 6 months ended 30 June 2020 was approved by the Management Board for publication on 08 September 2020.
The Company prepared also Condensed Interim Consolidated Financial Statements concerning the period of 6 months ended 30 June 2020, which were approved by the Management Board on 08 September 2020 for publication.
3. Company's Investments
The Company has investments in the following subsidiaries:
30 June 2020 | 31 December 2019 | |||||
Company name | Register | Share in Capital | Share in Capital | |||
ed office | ||||||
Arkady Wrocławskie S.A. | Wrocław | 100% | 100% | |||
Sky Tower S.A. | Wrocław | 100% | 100% | |||
Warszawa Przyokopowa Sp. z o.o. | Wrocław | 100% | 100% | |||
100% (indirectly and | 100% (indirectly and | |||||
Kraków Zielony Złocień Sp. z o.o. | Wrocław | directly) | directly) | |||
100% (indirectly and | 100% (indirectly and | |||||
LC Corp Invest I Sp. z o.o. | Wrocław | directly) | directly) | |||
LC Corp Invest II Sp. z o.o. | Wrocław | 100% | 100% | |||
LC Corp Invest III Sp. z o.o. | Wrocław | 100% | 100% | |||
9
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
LC Corp Invest VII Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest VIII Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest IX Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest X Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest XI Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest XII Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest XV Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest XVI Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest XVII Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest XIX Sp. z o.o. w likwidacji (a) | Wrocław | 100% | 100% | |
LC Corp Invest XXI Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest XXII Sp. z o.o. w likwidacji (b) | Wrocław | 100% | 100% | |
LC Corp Invest XXIII Sp. z o.o. w likwidacji (c) | Wrocław | - | 100% | |
LC Corp Invest XXIV Sp. z o.o. | Wrocław | 100% | 100% | |
LC Corp Invest XV Sp. z o.o. Projekt 2 Sp. k. | Wrocław | 100% (indirectly) | 100% (indirectly) | |
LC Corp Invest XV Sp. z o.o. Projekt 4 Sp. k. | Wrocław | 100% (indirectly) | 100% (indirectly) | |
LC Corp Invest XV Sp. z o.o. Projekt 6 Sp. k. | Wrocław | 100% (indirectly) | 100% (indirectly) | |
LC Corp Invest XV Sp. z o.o. Projekt 7 Sp. k. | Wrocław | 100% (indirectly) | 100% (indirectly) | |
LC Corp Invest XV Sp. z o.o. Projekt 8 Sp. k. | Wrocław | 100% (indirectly) | 100% (indirectly) | |
LC Corp Invest XV Sp. z o.o. Projekt 9 Sp. k. | Wrocław | 100% (indirectly) | 100% (indirectly) | |
LC Corp Invest XV Sp. z o.o. Projekt 10 Sp. k. | Wrocław | 100% (indirectly) | 100% (indirectly) | |
LC Corp Invest XV Sp. z o.o. Projekt 11 Sp. k. | Wrocław | 100% (indirectly) | 100% (indirectly) | |
100% (indirectly and | 100% (indirectly and | |||
LC Corp Invest XVII Sp. z o.o. Projekt 20 Sp. k. | Wrocław | directly) | directly) | |
LC Corp Invest XVII Sp. z o.o. Projekt 21 Sp. k. | Wrocław | 100% (indirectly) | 100% (indirectly) | |
100% (indirectly and | 100% (indirectly and | |||
LC Corp Invest XVII Sp. z o.o. Projekt 22 Sp. k. | Wrocław | directly) | directly) | |
100% (indirectly and | 100% (indirectly and | |||
LC Corp Invest XV Sp. z o.o. Investments S.K.A. | Wrocław | directly) | directly) | |
LC Corp Service S.A. | Wrocław | 100% (indirectly and | 100% (indirectly and | |
directly) | directly) | |||
Develia Invest Sp. z o.o. | Wrocław | 100% (directly) | 100% (directly) | |
- On 13 June 2019, a resolution on initiating the liquidation of LC Corp Invest XIX Sp. z o.o. was carried, and on 29 March 2020, a resolution on the completion of liquidation was adopted. Consequently, the company was removed from the National Court Register (KRS) on 14 July 2020.
- On 11 May 2020, a resolution on initiating the liquidation of LC Corp Invest XXII Sp. z o.o. was carried.
- On 13 June 2019, a resolution on initiating the liquidation of LC Corp Invest XXIII Sp. z o.o. was carried, and on 29 March 2020, a resolution on the completion of liquidation was adopted. Consequently, the company was removed from the National Court Register (KRS) on 13 May 2020.
As at 30 June 2020 and as at 31 December 2019, the share in the total vote held by the Parent Undertaking in its subsidiaries was equal to the share of the Parent Undertaking in the capitals of these entities.
10
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
4. Basis for Preparation of Condensed Interim Financial Statements
These Condensed Interim Financial Statements of Develia S.A. were prepared in accordance with the International Financial Reporting Standards ("IFRS") adopted by the EU, in particular with the International Accounting Standard No. 34.
IFRS comprise standards and interpretations accepted by the International Accounting Standard Board ("IASB") and the International Financial Reporting Interpretations Committee ("IFRIC").
These Condensed Interim Financial Statements concern the period of 6 months ended on 30 June 2020 and contain comparative data for the period of 6 months ended on 30 June 2019 and as at the 31 December 2019.
The Interim Condensed Financial Statements are presented in thousand zlotys ("PLN"), and all values included in the tables and descriptions, if not indicated otherwise, are given in PLN'000.
The Condensed Interim Financial Statements have been prepared on the going concern assumption, i.e. the continuation of the Company's business activity in the foreseeable future.
These condensed interim financial statements were prepared using the historical cost method, except for a part of derivative instruments which are measured at fair value.
As at the day of the approval of these financial statements, no circumstances were identified that could be regarded as a threat to the continuation of the Company's activity.
The Condensed Interim Financial Statements do not contain all information and disclosures required for annual financial statements and they must be read together with the Company's financial statements for the year ended 31 December 2019.
On 15 July 2019, the merger between Develia S.A. (the Acquiring Company) and LC Corp Invest XX Sp. z o.o. (the Acquired Company) was registered. The merger was completed pursuant to Article 492(1)(1) of the Code of Commercial Partnerships and Companies in conjunction with Article 516 of the said Code through the transfer to the Acquiring Company - as the sole shareholder in the Acquired Company - of the entire assets of Acquired Company under conditions set out in the Merger Plan of 10 May 2019 (according to information released by the Issuer in its Current Report no. 16/2019 of 10 May 2019).
The merger of the companies has been accounted for in the Acquiring Company's books and records by the
pooling of interests method; to this end, the respective items of relevant assets and liabilities and revenues and expenses of the merged companies have been summed up, as at the date of merger, after they had been adjusted using uniform valuation methods and the following had been eliminated:
- Reciprocal receivables and payables, as well as the revenues and costs of business transactions carried out in the same financial year;
- The distribution of profit received from the Acquired Company and contributions made thereto;
- The acquired company's share capital;
- The adjustment of the item "Other funds" by a difference between the sum of assets and liabilities acquired;
- Retained profits/unrealised losses carried forward, as presented herein, following the merger, have been summed up with account taken of the foregoing adjustments. As at 16 November 2011, the Acquired Company did not close its books of account.
Due to the merger, comparatives for the period of 6 months ended 30 June 2019 were restated compared to the financial statements published and covering that period.
The below table demonstrates changes in comparatives in the statement of comprehensive income for the period of 6 months ended 30 June 2019:
11
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
Period of 6 | Period of 6 | |||
months | months | |||
ended | Change | ended | ||
30 June 2019 | 30 June 2019 | |||
(published) | (restated) | |||
Operating income | ||||
Revenue from sale of services, products and goods | 14,099 | (512) | 13,587 | |
Revenue from interest and discounts | 6,433 | (800) | 5,633 | |
Revenue from dividend | 119,078 | (0) | 119,078 | |
Other financial income | 4 | (0) | 4 | |
Other operating income | 76 | (65) | 11 | |
Total operating income | 139,690 | (1,377) | 138,313 | |
Operating expenses | ||||
Operating expenses, cost of sold products and goods | (23,999) | 4 | (23,995) | |
Costs of interest and discounts | (11,270) | 1,215 | (10,055) | |
Other financial expenses | (2,144) | 0 | (2,144) | |
Other operating expenses | (776) | (26) | (802) | |
Total operating expenses | (38,189) | 1,193 | (36,996) | |
Pre-tax profit/(loss) | 101,501 | (184) | 101,317 | |
Income tax (tax expense) | 214 | 32 | 246 | |
Net profit/(loss) on continued operations | 101,715 | (152) | 101,563 | |
Discontinued operations | ||||
Profit (loss) on discontinued operations in the financial year | - | - | - | |
Net profit/(loss) | 101,715 | (152) | 101,563 | |
Other comprehensive income | ||||
Other components of comprehensive income | - | - | - | |
Income tax relating to other components of comprehensive income | - | - | - | |
Other comprehensive income (net) | - | - | - | |
Total comprehensive income | 101,715 | (152) | 101,563 | |
5. Accounting Principles Applied to Preparation of Condensed Interim Financial Statements
The accounting principles (policies) applied to the preparation of these financial statements are consistent with those adopted to draw up the financial statements for the year ended 31 December 2019, save for the following principles. The below changes to IFRS have been applied to these financial statements as of the date of their entry into force:
- Amendments to IAS 1 "Presentation of Financial Statements" and IAS 8 "Accounting Policies, Changes in Accounting Estimates and Errors" - Definition of Materiality - approved by the EU on 29 November 2019 (applicable to annual periods beginning on or after 1 January 2020);
- Amendments to IFRS 3, "Business Combinations" - Definition of a Business - approved in the EU on 21 April 2020 (applicable to combinations for which the acquisition date is at the beginning of the first annual reporting period beginning on or after 1 January 2020 and to asset acquisitions that occur on or after the beginning of the aforesaid period);
12
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
-
Amendments to IFRS 9 "Financial Instruments", IAS 39 "Financial Instruments: Recognition and
Measurement" and IFRS 7 "Financial Instruments: Disclosures" - Interest Rate Benchmark Reform - approved in the EU on 15 January 2020 (applicable to annual periods beginning on or after 1 January 2020); - Amendments to References to the Conceptual Framework in IFRS - approved by the EU on 29 November 2019 (applicable to annual periods beginning on or after 1 January 2020).
The adoption of the standards and amendments to existing standards, as mentioned above, did not exert any considerable impact on the financial statements.
6. New Standards and Interpretations Published But Not Effective Yet
Currently, IFRS in the form approved by the EU do not differ significantly from regulations issued by the International Financial Reporting Interpretations Committee ("IFRIC"), except for the following new standards and amendments to standards which as at [the date of the publication of these statements] were not approved for application within the EU (the below entry into force dates relate to the full version of standards):
- IFRS 14, "Regulatory Deferral Accounts" (applicable to annual periods beginning on or after 1 January 2016) - the European Commission decided not to initiate the process of approving this temporary standard for application within the EU before the release of the final version of IFRS 14;
- IFRS 17 "Insurance Contracts", with further amendments to IFRS 17, (applicable to annual periods beginning on or after 01 January 2023);
- Amendments to IAS 1 "Presentation of Financial Statements" - Classification of Liabilities as Current or Non- current (applicable to annual periods beginning on or after 01 January 2023);
- Amendments to IAS 16 "Property, Plant and Equipment" - Proceeds Before Intended Use (applicable to annual periods beginning on or after 1 January 2022);
- Amendments to IAS 37 "Provisions, Contingent Liabilities and Contingent Assets" - Onerous Contracts - Cost of Fulfilling a Contract (applicable to annual periods beginning on or after 1 January 2022);
- Amendments to IFRS 3 "Business Combinations" - Amendments to References to the Conceptual Framework including amendments to IFRS 3 (applicable to annual periods beginning on or after 1 January 2022);
- Amendments to IFRS 4 "Insurance Contracts" - the Extension of the Temporary Exemption from Applying IFRS 9 (the expiry date for the temporary exemption from IFRS 9 was extended to annual periods beginning on or after 1 January 2023);
- Amendments to IFRS 10, "Consolidated Financial Statements" and IAS 28, "Investments in Associates and Joint Ventures" - Sale or Contribution of Assets between an Investor and its Associate or Joint Venture and subsequent amendments (the date of entry into force of the amendments was postponed until research works on the equity method have been completed);
- Amendments to IFRS 16 "Lease"- Covid-19-Related Rent Concessions (applicable to annual periods beginning on or after 1 June 2020. Early application is permitted also for financial statements which have not been approved yet for publication on 28 May 2020. This amendment applies also to interim reports).
- Amendments to miscellaneous standards "Improvements to IFRS (the 2018-2020 cycle)" - amendments made as part of the IFRS Annual Improvement Process (IFRS 1, IFRS 9, IFRS 16 and IAS 41) are designed mainly to deal with non-conformitiesand ensure the consistency of terminology (amendments to IFRS 1, IFRS 9 and IAS 41 are applicable to annual periods beginning on or after 1 January 2022. Amendments to IFRS 16 concern only an illustrative example, hence no entry into force date has been set).
The Company is in the process of verification of the impact of the other above-mentioned standards on its financial situation, performance and the scope of information presented in financial statements.
According to the Company's estimates, the above-mentioned new standards and amendments to existing standards would not have had major impact on the financial statements if they had been applied by the Company at the balance-sheet date.
13
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
7. Significant Values Based on Professional Judgement and Estimates
The Company's Management Board applied their best knowledge regarding not only the standards and interpretations used, but also the methods and principles of valuation of individual items of the enclosed financial statements. Preparing the financial statements in accordance with IFRS required the Company's Management Board to make some assessments and assumptions, which are reflected in these statements. Actual results may vary from these estimates.
The financial data for the first half of 2020 presented herein was subject to auditor's examination.
Professional Judgement
In the process of applying the accounting principles (policies) to the issues specified hereinbelow, the professional judgement of the management was, apart from the accounting estimates, of the greatest importance.
Uncertainty of Estimates
The basic assumptions concerning the future have been discussed below as well as other key reasons for doubts occurring at the end of the reporting period and entailing a significant risk of considerable adjustment of the net book value of assets and liabilities in the following reporting period.
Deferred Tax Asset
The Company recognises a deferred tax asset based on the assumption that a tax profit enabling its utilisation should be obtained in the future. Worse tax results obtained in the future could have the effect that this assumption might become groundless. Deferred income tax is presented in Note 10.3.
Write-downs of shares held in subsidiary undertakings
At the end of each reporting period, the Management Board verifies if there is any evidence pointing to the impairment of the shares in subsidiary undertakings.
If the verification reveals the existence of such impairment, the Management Board writes down these assets to their recoverable value. The recoverable value of an asset can be defined as being the higher one of the two values: fair value less costs to sell or value in use.
The value in use is estimated with the DCF method or with the hybrid model: net assets and discounted revenues (discounted dividends). The DCF method is based on discounted cash flows generated by the subsidiary undertakings within the approved investment schedules and proceeds from the sale of flats, taking into consideration the sale price of 1 square metre of usable floor space in accordance with the current market situation and prices. The discount rate takes account of the weighted average cost of external and own capital (WACC).
The recoverable value of shares and the amount of their write-downs were estimated as at 30 June 2020 and may be subject to a change depending on the fluctuations of the market prices of land, sale prices of flats, constructions costs, project completion schedules and discount rate calculations in the future.
The actual results may vary from these estimates, which were calculated on the grounds of the data available as at the reporting date. It is also related to the uncertainty regarding the proper estimation of the market conditions in the following years. Consequently, the amount of write-downs may change in the following accounting periods.
Write-Downs of Shares are presented in Note 12.
Classification of Lease Agreements
The Company classifies lease according to IFRS 16.
Write-downs of Inventories
At the end of each reporting period, the Management Board verifies if there is any evidence pointing to the loss of value of its property development projects under implementation on the basis of sales reports, market research and other available evidence. Should the risk of the loss of value occur, the value of such projects is estimated employing the DCF method, which is used to establish the write-down of inventories. The DCF
14
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
method is based on discounted cash flows generated within the approved investment schedules and proceeds from the sale of premises, allowing for the sale price of 1 square metre of usable floor area of flats in accordance with the current market situation. The discount rate takes account of the weighted average cost of external and own capital (WACC).
The write-downs of inventories are estimated as at 30 June 2020 and may be subject to change depending on the fluctuation of market prices of land, selling prices of flats, construction costs, project completion schedules and discount rate calculations in the future. The actual results may vary from these estimates, which were calculated on the grounds of the data available as at the reporting date. It is also related to the uncertainty regarding the proper estimation of the market conditions in the following years. Consequently, valuation allowances may change in the following financial periods. As at 30 June 2020, there were no write-downs of inventory.
Uncertainty Associated with Tax Settlements
The regulations concerning the tax on goods and services, corporate tax and burdens associated with social insurance are subject to frequent changes. These frequent changes make no appropriate reference points, inconsistent interpretations and few established precedents that might be applicable. The binding regulations also contain uncertainties, resulting in different opinions regarding the legal interpretation of tax regulations, both among public authorities and between public authorities and companies.
Tax settlements and other areas of activity (for example customs and foreign currency issues) may be subject to inspection by bodies authorised to impose high penalties and fines, and any additional tax liabilities arising from the inspection must be paid together with high interest. Having considered these conditions, the tax risk in Poland is greater than in countries with a more mature tax system.
Consequently, amounts presented and disclosed in financial statements may change in the future as a result of a final decision of a tax audit authority.
On 15 July 2016, changes were made to the Tax Ordinance Act in order to take account of the provisions of the General Anti-Avoidance Rule (GAAR). GAAR is to prevent the creation and use of artificial legal structures created in order to avoid the payment of tax in Poland. GAAR defines the avoidance of taxation as an action made above all in order to achieve a tax advantage, contrary - under given circumstances - to the object and purpose of the provisions of the tax act. In accordance with GAAR, such an action does not result in the tax advantage, if the operation was artificial. Any occurrence of (i) unjustified separation of operations, (ii) involvement of intermediary entities despite the lack of economic justification, (iii) elements that null or compensate each other and (iv) other actions having a similar effect to the previously mentioned, may be treated as a premise of artificial operations subject to GAAR. New regulations will require a much greater degree of professional judgement in assessing the tax consequences of individual transactions.
The GAAR clause should be applied to transactions made after its entry into force and transactions that had been carried out before the entry into force of the GAAR clause, but for which benefits were or are still being gained after the date of entry of this clause into force. The implementation of these provisions will enable Polish tax audit authorities to question the legal arrangements and agreements carried out by taxable persons, such as the restructuring and reorganisation of a group.
The Company recognises and measures the assets or liabilities in respect of current and deferred income tax in compliance with the requirements of IAS 12, Income Tax on the basis of the profit (tax loss), tax base, unrelieved tax losses, unused tax exemptions and tax rates, taking into account the uncertainty associated with tax settlements.
The table below presents estimates as at 30 June 2020 and as at 31 December 2019.
30 June 2020 | 31 December 2019 | ||
(audited) | (audited) | ||
Deferred tax asset | - | - | |
Deferred tax liability | 16,552 | 17,448 | |
Write-downs of shares | 29,940 | (36,741) |
15
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
8. Seasonal or Cyclical Nature of Activity
The Company's operations are not seasonal by nature, therefore the presented Company's operating results are not subject to significant fluctuations during a year.
9. Information on Segments of Activity
For management purposes, Develia S.A. distinguishes two reporting operating segments:
- property development activity segment
- holding (other) activity segment
The tables presented below show data concerning revenues and expenses of the Company's individual segments for the period of 6 months ended 30 June 2020 and 30 June 2019.
Property | Holding (other) | |||||
Period of 6 months ended 30 June 2020 | development | TOTAL | ||||
activity | ||||||
activity | ||||||
Operating income | ||||||
Revenue from sale of services, products and goods | - | 8,745 | 8,745 | |||
Revenue from interest and discounts | - | 2,401 | 2,401 | |||
Revenue from dividend | - | 235,559 | 235,559 | |||
Other financial income | - | 6,400 | 6,400 | |||
Other operating income | - | 357 | 357 | |||
Total operating income | - | 253,462 | 253,462 | |||
Operating expenses | ||||||
Operating expenses, cost of sold products and goods | (2,126) | (19,398) | (21,524) | |||
Costs of interest and discounts | - | (5,302) | (5,302) | |||
Other financial expenses | - | (426) | (426) | |||
Other operating expenses | - | (70) | (70) | |||
Total operating expenses | (2,126) | (25,196) | (27,322) | |||
Pre-tax profit/(loss) | (2,126) | 228,266 | 226,140 | |||
Income tax (tax expense) | 404 | 492 | 896 | |||
Net profit/(loss) on continued operations | (1,722) | 228,758 | 227,036 | |||
Discontinued operations | ||||||
Profit (loss) on discontinued operations in the financial year | - | 0 | - | |||
Net profit/(loss) | (1,722) | 228,758 | 227,036 | |||
Other comprehensive income | ||||||
Other components of comprehensive income | - | - | - | |||
Income tax relating to other components of comprehensive income | - | - | - | |||
Other comprehensive income (net) | - | - | - | |||
Total comprehensive income | (1,722) | 228,758 | 227,036 | |||
Period of 6 months ended 30 June 2019 | Property | Holding (other) | ||||
development | TOTAL | |||||
(restated data) | activity | |||||
activity | ||||||
Operating income | ||||||
Revenue from sale of services, products and goods | - | 13,587 | 13,587 | |||
Revenue from interest and discounts | - | 5,633 | 5,634 | |||
Revenue from dividend | - | 119,078 | 119,078 | |||
Other financial income | - | 4 | 4 | |||
16
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
Other operating income | - | 11 | 11 |
Total operating income | - | 138,313 | 138,313 |
Operating expenses
Operating expenses, cost of sold products and goods Costs of interest and discounts
Other financial expenses Other operating expenses
(654) | (23,341) | (23,995) |
(10,055) | (10,055) | |
(2,144) | (2,144) | |
(802) | (802) |
Total operating expenses | (654) | (36,342) | (36,996) |
Pre-tax profit/(loss) | (654) | 101,971 | 101,317 |
Income tax (tax expense) | 124 | 122 | 246 |
Net profit/(loss) on continued operations | (530) | 102,093 | 101,563 |
Discontinued operations | |||
Profit (loss) on discontinued operations in the financial year | - | - | - |
Net profit/(loss) | (530) | 102,093 | 101,563 |
Other comprehensive income | |||
Other components of comprehensive income | - | - | - |
Income tax relating to other components of comprehensive income | - | - | - |
Other comprehensive income (net) | - | - | - |
Total comprehensive income | (530) | 102,093 | 101,563 |
17
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
10. Income Tax
10.1. Tax Expense
The main components of tax expense for the period of 6 months ended 30 June 2020 and 30 June 2019 are as follows:
Period ended | Period ended | ||
30 June 2020 | 30 June 2019 | ||
(audited) | (unaudited) | ||
Statement of Comprehensive Income | |||
Current income tax | |||
Current income tax expense | |||
Adjustments of current income tax from previous years | - | - | |
Deferred Income Tax | |||
Timing differences and their reversal | (896) | (246) | |
Tax expense reported in the statement of comprehensive | |||
income | (896) | (246) | |
10.2. Reconciliation of Effective Tax Rate
The reconciliation of income tax on the gross financial result before taxation according to the statutory tax rate, with income tax calculated according to the Company's effective tax rate for the period of 6 months ended 30 June 2020 and 30 June 2019 is as follows:
Period ended | Period ended | ||
30 June 2020 | 30 June 2019 | ||
(audited) | (unaudited) | ||
Profit /(loss) before tax on continued operations | 226,140 | 101,317 | |
Profit /(loss) before tax on discontinued operations | - | - | |
Pre-tax profit /(loss) | 226,140 | 101,317 | |
Tax at the statutory tax rate applicable in Poland: 19% (2019: 19%) | 42,967 | 19,250 | |
Non-tax-deductible costs | 73 | 1,369 | |
Share in limited partnerships | 2,032 | 262 | |
Write-downs of shares | (1,216) | 166 | |
Revenue from dividend (non-taxed) | (44,756) | (22,625) | |
Settlement of discount of share acquisition price and deferred | |||
payment interest | - | 232 | |
Other | 4 | 1,100 | |
Tax according to effective tax rate | (896) | (246) | |
Income tax (expense) reported in the Statement of Comprehensive | |||
Income | (896) | (246) | |
Income tax attributed to discontinued operations | - | - | |
896 | 246 | ||
10.3. Deferred Income Tax
Deferred income tax arises from the following items:
18
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
Statement of | Statement of | |||||
Financial Position | of Comprehensive Income | |||||
for the period ended | for the period ended | |||||
30 June 2020 | 31 December | 30 June 2020 | 31 December | |||
(audited) | 2019 | (audited) | 2019 | |||
(audited) | (audited) | |||||
Deferred tax liability | ||||||
Accrued interest on borrowings and deposits | (1,359) | (992) | (367) | 546 | ||
Difference in the value of tangible assets (tax and | ||||||
balance-sheet depreciation) | (86) | (83) | (3) | (21) | ||
Shares in limited partnerships | (26,356) | (22,575) | (3,781) | (21,426) | ||
Other | (505) | (390) | (115) | (100) | ||
Gross deferred tax liabilities | (28,306) | (24,040) | ||||
Deferred tax assets | ||||||
Provisions and prepayments and accrued income | 2,021 | 2,081 | (60) | 190 | ||
Accrued interest on borrowings and discounts on | ||||||
notes and bonds | 3,122 | 3,327 | (205) | (245) | ||
Losses potentially deductible from future taxable | 5,427 | |||||
income | 6,611 | 1,184 | (1,184) | |||
Gross deferred tax assets | 11,754 | 6,592 | ||||
Deferred tax expense | ||||||
896 | 22,240 | |||||
Net deferred tax asset | ||||||
Net deferred tax liabilities | 16,552 | 17,448 | ||||
11. Property, plant and equipment
In the period of 6 months ended 30 June 2020, the Company acquired property, plant and equipment in the amount of PLN 93,000 (in the period of 6 months ended 30 June 2019: PLN 816,000).
In the period of 6 months ended 30 June 2020, the Company entered into a lease agreement for 13 passenger cars. The value of right-of-use assets was PLN 452,000.
In the period of 6 months ended 30 June 2020, the Company sold items of property, plant and equipment earning the revenue in the total amount of PLN 54,000 (in the period of 6 months ended 30 June 2019 the revenue generated in that respect was PLN 15,000).
As at 30 June 2020, there were no significant liabilities on account of the purchase of property, plant or equipment.
As at 30 June 2020 and 31 December 2019, no item of tangible assets was used as collateral, was subject to encumbrance or was mortgaged.
12. Non-current investments
Shares
19
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
As at 30 June 2020 and 31 December 2019, the Company owned the following shares in companies:
30 June 2020 | 31 December 2019 | |||||
Company name | Registered | Balance | Participation | Balance | Participation | |
office | sheet | in share capital | sheet value | in share capital | ||
value in | in PLN'000 | |||||
PLN'000 | ||||||
Arkady Wrocławskie S.A. | Wrocław | 128,652 | 100% | 128,652 | 100% | |
Sky Tower S.A. | Wrocław | 231,198 | 100% | 231,198 | 100% | |
Warszawa Przyokopowa Sp. z o.o. | Wrocław | 46,367 | 100% | 46,367 | 100% | |
Kraków Zielony Złocień Sp. z o.o. | Wrocław | 29,963 | 100% (indirectly | 29,963 | 100% (indirectly and | |
and directly) | directly) | |||||
Wrocław | 1 | 100% (indirectly | 1 | 100% (indirectly and | ||
LC Corp Invest I Sp. z o.o. | and directly) | directly) | ||||
LC Corp Invest II Sp. z o.o. | Wrocław | 91,788 | 100% | 91,788 | 100% | |
LC Corp Invest III Sp. z o.o. | Wrocław | 10,308 | 100% | 10,308 | 100% | |
LC Corp Invest VII Sp. z o.o. | Wrocław | 12,234 | 100% | 12,234 | 100% | |
LC Corp Invest VIII Sp. z o.o. | Wrocław | 20,500 | 100% | 20,500 | 100% | |
LC Corp Invest IX Sp. z o.o. | Wrocław | 17,096 | 100% | 17,096 | 100% | |
LC Corp Invest X Sp. z o.o. | Wrocław | 19,500 | 100% | 19,500 | 100% | |
LC Corp Invest XI Sp. z o.o. | Wrocław | 85,935 | 100% | 85,935 | 100% | |
LC Corp Invest XII Sp. z o.o. | Wrocław | 40,582 | 100% | 40,582 | 100% | |
LC Corp Invest XV Sp. z o.o. | Wrocław | 305 | 100% | 305 | 100% | |
LC Corp Invest XV Sp. z o.o. | 100% (indirectly | 100% (indirectly and | ||||
Investments S.K.A. | Wrocław | 91,855 | and directly) | 91,855 | directly) | |
LC Corp Invest XVI Sp. z o.o. | Wrocław | 5 | 100% | 5 | 100% | |
LC Corp Invest XVII Sp. z o.o. | Wrocław | 5 | 100% | 5 | 100% | |
LC Corp Invest XVII sp. z o.o. | 100% (indirectly | 100% (indirectly and | ||||
Projekt 20 Sp.k. | Wrocław | 85,915 | and directly) | 85,915 | directly) | |
LC Corp Invest XVII sp. z o.o. | 100% (indirectly | 100% (indirectly and | ||||
Projekt 22 Sp.k. | Wrocław | 42,710 | and directly) | 42,710 | directly) | |
LC Corp Invest XIX Sp. z o.o. w | Wrocław | - | - | 380 | 100% | |
likwidacji (a) | ||||||
LC Corp Invest XXI Sp. z o.o. | Wrocław | 205 | 100% | 205 | 100% | |
LC Corp Invest XXII Sp. z o.o. w | Wrocław | 120 | 100% | 120 | 100% | |
likwidacji (b) | ||||||
LC Corp Invest XXIII Sp. z o.o. w | Wrocław | - | - | 100 | 100% | |
likwidacji (c) | ||||||
LC Corp Invest XXIV Sp. z o.o. | Wrocław | 14,550 | 100% | 14,550 | 100% | |
100% (indirectly | 100% (indirectly and | |||||
LC Corp Service S.A. | Wrocław | 13,345 | and directly) | 13,345 | directly) | |
Develia Invest Sp. z o.o. | Wrocław | 621 | 100% | 621 | 100% | |
Write-down of shares | (29,940) | (36,741) | ||||
Total | 953,820 | 947,499 |
- On 13 June 2019, a resolution on initiating the liquidation of LC Corp Invest XIX Sp. z o.o. was carried, and on 29 March 2020, a resolution on the completion of liquidation was adopted. Consequently, the company was removed from the National Court Register (KRS) on 14 July 2020.
- On 11 May 2020, a resolution on initiating the liquidation of LC Corp Invest XXII Sp. z o.o. was carried.
20
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
- On 13 June 2019, a resolution on initiating the liquidation of LC Corp Invest XXIII Sp. z o.o. was carried, and on 29 March 2020, a resolution on the completion of liquidation was adopted. Consequently, the company was removed from the National Court Register (KRS) on 13 May 2020.
As at 30 June 2020, the Management Board made an update of write-downs of shares to their recoverable value. The total value of write-downs of shares as at 30 June 2020 was PLN 29,940,000 (compared to PLN 36,741,000 as at 31 December 2019).
The changes in write-downs of shares in respective companies are presented in the table below:
Year ended | Revers | Created/Incre | Year ended | ||
Company | Used | 31 December | |||
30 June 2020 | ed | ased | |||
2019 | |||||
LC Corp Invest II Sp. z o.o. | (5,320) | - | - | - | (5,320) |
LC Corp Invest IX Sp. z o.o. | - | - | 2,375 | - | (2,375) |
LC Corp Invest XI Sp. z o.o. | (2,399) | - | 1,663 | - | (4,062) |
LC Corp Invest XV Sp. z o.o. Investments SKA | (21,868) | - | - | - | (21,868) |
LC Corp Invest XIX Sp. z o.o. w likwidacji | - | 336 | - | - | (336) |
LC Corp Invest XXII Sp. z o.o. | (86) | - | - | - | (86) |
LC Corp Invest XXIII Sp. z o.o. w likwidacji | - | 66 | - | - | (66) |
LC Corp Invest XVII Sp. z o.o. Projekt 20 Sp.k. | (267) | - | 2,361 | - | (2,628) |
(29,940) | 402 | 6,399 | - | (36,741) |
The change in the write-downs of shares made in subsidiaries in the reporting period ended 30 June 2020 result mainly from the revision of budgets and work schedules relating to development projects carried out by these subsidiaries.
The amount of write-down made/reversed is recognised by the Company in the Statement of Comprehensive Income at Other Financial Income / Other Financial Expenses.
The project recoverable value corresponds to the value in use of every single project. Tests conducted for the period ended 30 June 2020 relied on a discount rate standing at 10.4% (in 2019: 10.4%).
13. Non-current loans and receivables
30 June 2020 | 31 December 2019 | |
(audited) | (audited) | |
Non-current borrowings (with interest accrued) | 109,085 | 74,891 |
Long-term security deposits | 286 | 286 |
Total | 109,371 | 75,177 |
Within the period of 6 months ended 30 June 2020, the Company granted borrowings to its subsidiary undertakings for investment financing.
14. Current financial assets
30 June 2020 | 31 December 2019 | |
(audited) | (audited) | |
Short-term borrowings | 11,780 | 11,494 |
Cash in trust accounts | 13,291 | 12,663 |
Total | 25,071 | 24,157 |
21
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
15. Inventory
30 June 2020 | 31 December 2019 | ||
(audited) | (audited) | ||
Goods and work in progress | 637,749 | 531,963 | |
Finished products | 18,413 | - | |
Write-downs of Inventories | - | - | |
Payments made for land acquisition | 9,416 | 10,941 | |
Total inventories | 665,578 | 542,904 |
Compared to 31 December 2019, the change in Inventory during the reporting period ended 30 June 2020 results mainly from:
- The purchase of land designated for the implementation of residential projects, located at:
- Rzeszelska Street and Orawska Street in Wrocław;
- Jagiellońska Street in Warsaw;
- Letnicka Street in Gdańsk;
- Payments made towards land acquisition;
- Building and financial expenditures for housing projects implemented on land owned by the Company.
In the period ended 30 June 2020, the Company completed a residential project located at Granitowa Street in Wrocław and obtained the Certificate of Occupancy for the building. As at 30 June 2020, no premises were delivered yet.
As at 30 June 2020, the borrowing costs amounting to PLN 19,581,000 (as at 31 December 2019 these were PLN 10,609,000) were capitalised in the inventory.
16. | Trade and Other Receivables | |||
30 June 2020 | 31 December 2019 | |||
(audited) | (audited) | |||
Trade receivables | 2,009 | 8,542 | ||
State budget receivables (without income tax) | 4,504 | 68,414 | ||
Receivables in respect of sums blocked in deposit accounts, | 1,991 | 21,525 | ||
designated for the acquisition of real estate | ||||
Dividend and Profit Share Receivables | 15,574 | - | ||
Other receivables from third parties | 534 | 23 | ||
Total receivables (net) | 24,612 | 98,504 | ||
Valuation allowance for receivables | (82) | (64) | ||
Gross receivables | 24,694 | 98,568 |
Changes in the write-down of receivables were as follows:
22
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
30 June 2020 | 31 December 2019 | ||
(audited) | (audited) | ||
At the beginning of the period | (64) | (47) | |
Increase | (21) | (31) | |
Used | 3 | 13 | |
Reversed | 0 | 1 | |
At the and of the period | (82) | (64) |
17. Cash and Cash Equivalents
30 June 2020 | 31 December 2019 |
(audited) | (audited) |
Cash on hand and in a bank account Short-term deposits
37,3954,432
198,59224,389
235,98728,821
Cash in a bank account bears interest according to floating interest rates. Short-term deposits are made for different periods, from one day to three months, depending on the Company's current demand for cash, and bear interest according to interest rates negotiated for such periods.
18. Equity
18.1. Share capital
Share capital
Series A ordinary shares with a par value of PLN 1.00 per share Series B ordinary shares with a par value of PLN 1.00 per share Series C ordinary shares with a par value of PLN 1.00 per share Series D ordinary shares with a par value of PLN 1.00 per share Series E ordinary shares with a par value of PLN 1.00 per share Series F ordinary shares with a par value of PLN 1.00 per share Series G ordinary shares with a par value of PLN 1.00 per share Series H ordinary shares with a par value of PLN 1.00 per share Series J ordinary shares with a par value of PLN 1.00 per share Series I ordinary shares with a par value of PLN 1.00 per share
30 June 2020 | 31 December 2019 |
(audited) | (audited) |
500 | 500 |
113,700 | 113,700 |
1,453 | 1,453 |
1,472 | 1,472 |
32,000 | 32,000 |
102,000 | 102,000 |
80,000 | 80,000 |
58,433 | 58,433 |
57,000 | 57,000 |
1,000 | 1,000 |
447,558 | 447,558 |
Par value of shares
All issued shares have a par value of PLN 1.00 and have been fully paid.
Shareholders' rights
No shares of any series are preferred as to the dividend or return on capital. One share corresponds to one vote.
23
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
Significant shareholders
As at 30 June 2020, the shareholders possessing, directly or indirectly through subsidiary undertakings, at least
5% of the total vote at the General Meeting of the Issuer:
Share in Share | Share (%) in total | |||
Shareholder | Number of shares | Number of votes | vote at general | |
Capital (%) | ||||
meeting | ||||
Nationale-Nederlanden Otwarty | 81,545,000 | 81,545,000 | 18.22 % | 18.22 % |
Fundusz Emerytalny | ||||
Otwarty Fundusz Emerytalny PZU | 77,195,000 | 77,195,000 | 17.25 % | 17.25 % |
"Złota Jesień" | ||||
AVIVA Otwarty Fundusz | 54,707,246 | 54,707,246 | 12.22% | 12.22% |
Emerytalny AVIVA Santander | ||||
MetLife Otwarty Fundusz | 34,528,295 | 34,528,295 | 7.71% | 7.71% |
Emerytalny1) | ||||
Shareholders having directly or indirectly at least 5% of overall number of votes at general meeting of shareholders as at the date hereof pursuant to the information obtained by the Issuer
Share in Share | Share (%) in total | |||
Shareholder | Number of shares | Number of votes | vote at general | |
Capital (%) | ||||
meeting | ||||
Nationale-Nederlanden Otwarty | 83,470,921 | 83,470,921 | 18.65 % | 18.65 % |
Fundusz Emerytalny | ||||
Otwarty Fundusz Emerytalny PZU | 77,195,648 | 77,195,648 | 17.25 % | 17.25 % |
"Złota Jesień" | ||||
AVIVA Otwarty Fundusz | 59,612,000 | 59,612,000 | 13.32% | 13.32% |
Emerytalny AVIVA Santander | ||||
MetLife Otwarty Fundusz | 34,528,295 | 34,528,295 | 7.71% | 7.71% |
Emerytalny | ||||
18.2. Supplementary capital
Supplementary capital as at 30 June 2020 and 31 December 2019 totalled PLN 322,216,000.
The supplementary capital was created with the surplus of the issue value over the par value of PLN 321,452,000, less share issue costs disclosed as a decrease in the supplementary capital in the amount of PLN 13,215,000. The supplementary capital was used to cover the losses from years 2006, 2008 and 2009, in the total amount of PLN 20,240,000. The supplementary capital was increased by the amount of profit from the year 2007 and years 2010-2014 in the total amount of PLN 106,496,000, while in 2014 and 2015 a total of PLN 100,000,000 was transferred to reserve funds.
In the reporting period ended 31 December 2016, by way of a resolution of the Ordinary General Meeting adopted on 13 April 2016, the reserve funds in the amount of PLN 100,000,000 were released and transferred
24
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
to the supplementary capital in full. The funds accumulated in supplementary capital were used to pay out dividends in the amount of PLN 63,481,000.
In the reporting period ended 31 December 2017, by way of a resolution of the Ordinary General Meeting adopted on 27 April 2017, the funds accumulated in the supplementary capital were used for the payment of dividend in the amount of PLN 111,000.
In the reporting period ended 31 December 2018, by way of a resolution of the Ordinary General Meeting adopted on 27 June 2018, the funds accumulated in the supplementary capital were used for the payment of dividend in the amount of PLN 6,505,000.
In the reporting period ended 31 December 2019, by way of the resolution of the Ordinary General Meeting adopted on 13 June 2019, the funds accumulated in the supplementary capital were used for the payment of dividend in the amount of PLN 2,180,000.
In the reporting period ended 30 June 2020, no changes in the supplementary capital were reported. The below table presents the structure of supplementary capital:
Surplus of the issue value over the par value adjusted for | 308,237 |
issue costs (Agio) | |
Covering of losses of 2006, 2008, 2009 | 20,240 |
Supplementary capital from agio | 287,997 |
2007, 2010-2014 profit carryforward | 106,496 |
Payment of dividend | 72,277 |
Supplementary capital from profit | 34,219 |
Total | 322,216 |
18.3. Other reserve funds
As at 30 June 2020, there are no other reserve funds.
18.4. Other capital
Other capital, created as a result of the fair value measurement of management options in 2007, amounted to PLN 3,108,000; from that amount a sum of PLN 40,000, resulting from the settlement of the merger with LC Corp Invest Sp. z o. o. on 17 November 2011, was further deducted.
On 15 July 2019, the Company merged with another company, LC Corp Invest XX Sp. z o.o., which led, as a consequence, to the value of Other capital being decreased by a total of PLN 831,000.
On account of the settlement of that merger, the Other capital as at 31 December 2019 totalled PLN 2,237,000.
In the reporting period ended 30 June 2020, no changes in the Other capital were reported, hence the value thereof as at 30 June 2020 equals PLN 2,237,000.
25
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
19. Financial Liabilities
19.1. Interest-bearing bank loans, bonds, bills of exchange and borrowings
Non-current | Repayment date | Interest | 30 June 2020 | 31 December 2019 | ||
rate | (audited) | (audited) | ||||
Bond scheme (a) | 20 Mar 2020 | Wibor 6M+margin | - | - | ||
Bond scheme (b)(*) | 10 May 2021 | Wibor 6M+margin | - | 84,899 | ||
Bond scheme (c)(*) | 10 May 2021 | Wibor 6M+margin | - | 14,990 | ||
Bond scheme (d) (**) | 06 Oct 2021 | Wibor 6M+margin | 24,984 | 24,978 | ||
Bond scheme (e) (**) | 06 Oct 2021 | Wibor 6M+margin | 14,972 | 14,962 | ||
Bond scheme (f) | 05 Jun 2022 | Wibor 6M+margin | 49,818 | 49,770 | ||
Bond scheme (g) | 28 Feb 2022 | Wibor 6M+margin | 44,858 | 44,815 | ||
Bond scheme (h) | 19 Oct 2020 | Wibor 6M+margin | - | - | ||
Bond scheme (i) | 19 Oct 2022 | Wibor 3M+margin | 19,639 | 65,561 | ||
Bond scheme (j) | 22 May 2023 | Wibor 3M+margin | 59,592 | 59,519 | ||
Investment notes (k) | 30 Nov 2021 | IRS 2Y of 08/03/2012+margin | 6,182 | 6,023 | ||
Investment notes (l) | 09 Dec 2022 | Wibor 1M of 07/12/2010+margin | 45,265 | 44,305 | ||
Borrowing (m) | indefinite | EURIBOR 1M+margin | 23,001 | 21,699 | ||
Borrowing (n) | indefinite | Wibor 6M+margin | 84,344 | 82,629 | ||
Borrowing (o) | indefinite | Wibor 6M+margin | 10,989 | - | ||
Borrowing (p) | indefinite | Wibor 6M+margin | 25,354 | - | ||
Borrowing (r) | indefinite | EURIBOR 1M+margin | 2,637 | - | ||
411,635 | 514,150 | |||||
Interest | 30 June 2020 | 31 December 2019 | ||||
Current | Repayment date | (audited) | (audited) | |||
rate | ||||||
Bond scheme (a) | 20 Mar 2020 | Wibor 6M+margin | - | 65,886 | ||
Bond scheme (b)(*) | 10 Nov 2020/ | Wibor 6M+margin | 618 | |||
10 May 2021 | 85,394 | |||||
Bond scheme (c)(*) | 10 Nov 2020/ | Wibor 6M+margin | 109 | |||
10 May 2021 | 15,074 | |||||
Bond scheme (d) (**) | 06 Oct 2020 | Wibor 6M+margin | 249 | 309 | ||
Bond scheme (e) (**) | 06 Oct 2020 | Wibor 6M+margin | 148 | 184 | ||
Bond scheme (f) | 05 Dec 2020 | Wibor 6M+margin | 107 | 166 | ||
Bond scheme (g) | 28 Aug 2020 | Wibor 6M+margin | 681 | 757 | ||
Bond scheme (h) | 19 Oct 2020 | Wibor 6M+margin | 34,160 | 34,157 | ||
Bond scheme (i) | 20 Jul 2020 | Wibor 3M+margin | 46,560 | 693 | ||
Bond scheme (j) | 24 Aug 2020 | Wibor 3M+margin | 249 | 342 | ||
Investment notes (k) | 30 Nov 2021 | IRS 2Y of 08/03/2012+margin | - | - | ||
Investment notes (l) | 09 Dec 2022 | Wibor 1M of 07/12/2010+margin | - | - | ||
Borrowing (m) | indefinite | EURIBOR 1M+margin | - | - | ||
Borrowing (n) | indefinite | Wibor 6M+margin | - | - | ||
Borrowing (o) | indefinite | Wibor 6M+margin | - | - | ||
Borrowing (p) | indefinite | Wibor 6M+margin | - | - | ||
Borrowing (r) | indefinite | EURIBOR 1M+margin | - | - | ||
182,622 | 103,221 |
- On 23 December 2016, the assimilation of (g) series bonds, issued on 19 August 2016, with (f) series bonds, issued on 10 May 2016, took place on the "Catalyst" bond market
- On 25 April 2017, the assimilation of (i) series bonds, issued on 27 October 2016, with (h) series bonds, issued on 6 October 2016, took place on the "Catalyst" bond market
26
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
- Coupon bonds - the issue of 20 March 2015, including 65,000 five-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 65,000,000 under a Bond Issue Agreement concluded with the banks Pekao S.A., having its registered office in Warsaw, and mBank S.A., having its registered office in Warsaw. On 20 March 2020, the Company redeemed the bonds
- Coupon bonds - the issue of 10 May 2016, including 85,000 five-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 85,000,000 under a Bond Issue Agreement with the redemption date set at 10 May 2021 concluded with the banks Pekao S.A., having its registered office in Warsaw, and mBank S.A., having its registered office in Warsaw.
- On 23 December 2016, the assimilation of the bonds of the series in question with the bonds issued on 19 August 2016 took place on the "Catalyst" bond market.
- Coupon bonds - the issue of 19 August 2016, including 15,000 five-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 15,000,000 under a Bond Issue Agreement with the redemption date set at 10 May 2021 concluded with the banks Pekao S.A., having its registered office in Warsaw, and mBank S.A., having its registered office in Warsaw.
- On 23 December 2016, the assimilation of the bonds of the series in question with the bonds issued on 10 May 2016, took place on the "Catalyst" bond market.
- Coupon bonds - the issue of 6 October 2016, including 25,000 five-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 25,000,000 under a Bond Issue Agreement with the redemption date set at 6 October 2021 concluded with the banks Pekao S.A., having its registered office in Warsaw, and mBank S.A., having its registered office in Warsaw. (*) On 25 April 2017, the assimilation of the bonds of the series in question with the bonds issued on 27 October 2016 took place on the
"Catalyst" bond market.- Coupon bonds - the issue of 27 October 2016, including 15,000 five-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 15,000,000 under a Bond Issue Agreement with the redemption date set at 6 October 2021 concluded with the banks Pekao S.A., having its registered office in Warsaw, and mBank S.A., having its registered office in Warsaw. (*) On 25 April 2017, the assimilation of the bonds of the series in question with the bonds issued on 6 October 2016, took place on the
"Catalyst" bond market.- Coupon bonds - the issue of 5 December 2017, including 50,000 five-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 50,000,000 under a Bond Issue Agreement with the redemption date set at 5 June 2022 concluded with the banks Pekao S.A., having its registered office in Warsaw, and mBank S.A., having its registered office in Warsaw.
- Coupon bonds - the issue of 28 February 2018, including 45,000 four-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 45,000,000 under a Bond Issue Agreement with the redemption date set at 28 February 2022 concluded with the banks Pekao S.A., having its registered office in Warsaw, and mBank S.A., having its registered office in Warsaw.
- Coupon bonds - the issue of 19 October 2018, including 34,000 two-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 34,000,000 under a Bond Issue Agreement with the redemption date set at 19 October 2020 concluded with mBank S.A., having its registered office in Warsaw.
- Coupon bonds - the issue of 19 October 2018, including 66,000 four-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 66,000,000 under a Bond Issue Agreement with the redemption date set at 19 October 2022 concluded with mBank S.A., having its registered office in Warsaw. The Company received calls for early redemption in the total amount of PLN 46,000,000, the early redemption date falls on 20 July 2020.
- Coupon bonds - the issue of 22 May 2019, including 60,000 four-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 60,000,000 under a Bond Issue Agreement with the redemption date set at 22 May 2023 concluded with mBank S.A., having its registered office in Warsaw.
27
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
- Investment notes - the issue of 9 March 2012 of seven investment notes having a par value of PLN 2,000,000 each, taken up by a subsidiary - Arkady Wrocławskie S.A. On 31 January 2014, an amendment was signed to reschedule the redemption date of the notes from 31 January 2014 to 31 January 2017. On 30 January 2017, an amendment was signed to reschedule the redemption date of the notes from 31 January 2017 to 30 November 2017. On 30 November 2017, an amendment was signed to reschedule the redemption date of the notes from 30 November 2017 to 30 November 2019. On 27 November 2019, an amendment was signed to reschedule the redemption date of the notes for 30 November 2021.
- As at 30 June 2020, there are still two notes to be redeemed. Investment notes - the issue of 9 December 2010 of thirty investment notes having a par value of PLN 1,000,000 each, taken up by a subsidiary - Warszawa Przyokopowa Sp. z o.o. On 9 December 2013, an amendment was signed to reschedule the redemption date of the notes from 9 December 2013 to 9 December 2016. On 28 November 2016, an amendment was signed to reschedule the redemption date of the notes for 9 December 2019. On 27 November 2019, an amendment was signed to reschedule the redemption date of the notes to 9 December 2022.
- Borrowing - on 27 February 2019, Develia S.A. entered into a borrowing agreement with Warszawa Przyokopowa Sp. z o.o. under which a sum of EUR 5,000,000 was borrowed for an indefinite period of time.
- Borrowing - on 18 December 2019, Develia S.A. entered into a borrowing agreement with LC Corp Invest XVII Sp. z o.o. Projekt 20 Sp. k. under which a sum of PLN 82,500,000 was borrowed for an indefinite period of time.
- Borrowing - on 24 January 2020, Develia S.A. entered into a borrowing agreement with LC Corp Invest XXIV Sp. z o.o. under which a sum of PLN 11,000,000 was borrowed for an indefinite period of time.
- Borrowing - on 24 February 2020, Develia S.A. entered into a borrowing agreement with Warszawa Przyokopowa Sp. z o.o. under which a sum of PLN 25,000,000 was borrowed for an indefinite period of time.
- Borrowing - on 27 March 2020, Develia S.A. entered into a borrowing agreement with Warszawa Przyokopowa Sp. z o.o. under which a sum of EUR 587,000 was borrowed for an indefinite period of time.
In the period of 6 months ended 30 June 2020, the average weighted interest of loans, bonds, investment notes and borrowings totalled 4.25% (in the period ended 31 December 2019 it amounted to 5%).
19.2. Issue, Redemption of Equity Securities
In the period of 6 months ended 30 June 2020, no bonds were issued.
On 20 March 2020, 65,000 five-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 65,000,000 were redeemed.
After the balance-sheet date, i.e. on 20 July 2020, there was an early redemption of 46,000 four-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 46,000,000.
Changes to Documentation of Bond Issue Programme
On 5 March 2020, the Issuer and mBank S.A. concluded an amendment to the programme agreement of 2 October 2018 ("the Programme Agreement") under which the Issuer set up a bond issue programme for its bonds up to the total amount (nominal value) of issued and outstanding bonds of PLN 400,000,000 ("the Issue Programme"). The amendment to the Programme Agreement is designed to adapt both the Programme Agreement and documentation relating to the Issue Programme to amended provisions of law that apply to the issue of bonds. Bonds issued under the amended Issue Programme ("the Bonds") will be tendered for purchase pursuant to Article 33(1) or (2) of the Bonds Act of 15 January 2015.
28
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
In the period of 6 months ended 30 June 2020, no notes were issued nor redeemed.
19.3. Taking out and Repayment of Bank Loans and Borrowings
In the period of 6 months ended 30 June 2020, no bank loan was taken by the Company.
In the period of 6 months ended 30 June 2020, the Company took on the following commitments in the form of borrowings:
- On 24 January 2020, Develia S.A. entered into a borrowing agreement with LC Corp Invest XXIV Sp. z o.o., under which a sum of EUR 11,000,000 was borrowed on arm's length conditions for an indefinite period of time. On 8 and 29 April, the Company repaid a portion of the borrowings in the total amount of PLN 200,000.
- On 24 February 2020, Develia S.A. entered into a borrowing agreement with Warszawa Przyokopowa z o.o., under which a sum of PLN 25,000,000 was borrowed on arm's length conditions for an indefinite period of time.
- On 19 March 2020, Develia S.A. entered into a borrowing agreement with Warszawa Przyokopowa z o.o., under which a sum of PLN 100,000,000 was borrowed on arm's length conditions for an indefinite period of time (an amount of PLN 85,000,000 was drawn down). The borrowing was paid off in full on 31 March 2020.
- On 27 March 2020, Develia S.A. entered into a borrowing agreement with Warszawa Przyokopowa Sp. z o.o., under which a sum of EUR 587,000 was borrowed for an indefinite period of time.
20. Provisions
The amounts of provisions and the reconciliation presenting the changes in their position within the period of 6 months are shown in the table below:
Retirement and | Remedy of | Legal | Total | |
disability benefits | construction | actions | ||
and bereavement | faults and | |||
payment | defects | |||
As at 01 January 2019 | 19 | - | - | 19 |
Created during the financial year | - | - | - | - |
Used | - | - | - | - |
Reversed | - | - | - | - |
As at 30 June 2020 | 19 | - | - | 19 |
Current provisions as at 30 June 2020 | - | - | - | - |
Non-current provisions as at 30 June 2020 | 19 | - | - | 19 |
As at 01 January 2019 | 19 | - | - | 19 |
Created during the financial year | - | - | - | - |
Used | - | - | - | - |
Reversed | - | - | - | - |
As at 31 December 2019 | 19 | - | - | 19 |
Current provisions as at 31 December 2019 | - | - | - | - |
Non-current provisions as at 31 December 2019 | 19 | - | - | 19 |
29
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
21. Collateral
As at 30 June 2020, the repayment of loans taken out by Develia S.A. 's subsidiaries was secured mainly by:
- Pledge on the shares of Arkady Wrocławskie S.A. held by Develia S.A. - up to the amount of EUR 37,500,000;
- Registered pledges on all shares of Sky Tower S.A., together with a financial pledge of up to EUR 90,000,000;
- On 8 February 2018, Develia S.A. provided security to mBank Hipoteczny S.A. and mBank S.A. for the loan agreement concluded on 20 December 2017 between LC Corp Invest XVII sp. z o.o. Projekt 22 Sp. k., as the borrower, and mBank Hipoteczny S.A. and mBank S.A. The said security includes: subordination agreement on accounts receivable concluded by the borrower, Develia S.A. and other subsidiaries of the Issuer - LC Corp Invest XVII Sp. z o.o. and LC Corp Invest I Sp. z o.o., making them subordinated creditors, and mBank S.A. and mBank Hipoteczny S.A. as senior creditors; support agreement concluded between the borrower, mBank Hipoteczny S.A., mBank S.A. and Develia S.A. - as the guarantor, under which the guarantor will be obliged to provide financial support to the borrower under the circumstances specified in the said agreements, along with a declaration on submission to enforcement pursuant to Article 777 of the Code of Civil Procedure up to the amount of EUR 3,576,261.90; contract of surety concluded by the borrower, mBank Hipoteczny S.A., mBank S.A. and Develia S.A., under which Develia S.A. will stand surety for the borrower up to a partial amount of the borrower's liabilities as a result of achieving a certain level of DSCR; commitment to enter into a support agreement with the borrower, mBank Hipoteczny S.A., mBank S.A. and Develia S.A. as the guarantor, pursuant to which the guarantor will be obliged, under the circumstances specified in the said agreement, to provide financial support to the borrower, along with Develia S.A.'s declaration on submission to enforcement pursuant to Article 777 of the Code of Civil Procedure up to the amount of EUR 558,660.50; registered pledges in favour of mBank Hipoteczny S.A. and mBank S.A. established by Develia S.A., as the limited partner, along with a declaration on submission to enforcement pursuant to Article 777 of the Code of Civil Procedure.
22. Change in Contingent Liabilities and Contingent Assets
As from the end of the last financial year, there were no significant changes with regard to the Company's contingent liabilities or contingent assets.
In addition to the contingent liabilities serving as security for the bank loans described in detail in Note 21, the Company has contingent liabilities arising from a contingent fee of PLN 63,000 for the removal of trees, necessary to implement a project at Rokokowa street in Warsaw.
In addition to the foregoing, as a result of the disposal of real property by entities controlled by the Company, the Company guaranteed that the said entities would discharge their obligations arising from the Agreement concluded.
In pursuance of the Sales and Purchase Agreements covering two real properties: Silesia Star in Katowice and Retro Office House in Wrocław, described in section 2.1, the Company furnished the Purchasers, Ingadi spółka z ograniczoną odpowiedzialnością ("Ingadi") and Artigo spółka z ograniczoną odpowiedzialnością ("Artigo"), with rent guarantees issued for a five-year period (covering, inter alia, not leased floor areas), secured by suretyship provided by the Company (as the surety of LC Corp Invest XVII Sp. z o.o. Projekt 20 Sp. k. ("P20") and LC Corp Invest XVII Sp. z o.o. Projekt 21 Sp. k. ("P21"), acting as the Sellers and debtors). In relation to the aforesaid suretyship, the Company will guarantee that:
- obligations and liabilities arising from the Final Agreements will be discharged by P20 and P21, and
- obligations and liabilities of P20 and P21 relating to finish works to be done by tenants designated in the Final Agreements will be discharged by P20 and P21, and
- obligations and liabilities of P20 and P21 arising from the rent guarantee agreements contemplated in the Preliminary Sales and Purchase Agreements will be discharged by P20 and P21, and
- the Company will incur debts of P20 and P21 arising from obligations and liabilities of P20 and P21 under the Final Agreements and rent guarantee agreements if the Sellers have ceased their
30
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
operations, have gone into liquidation or have been dissolved, which circumstances will be described in the surety arrangement.
In pursuance of the Sales and Purchase Agreement covering the real property called Wola Center in Warsaw, described in Note 37 of the Financial Statements for the period ended 31 December 2019, the Company has undertaken to the Purchaser to stand surety for the Seller - Warszawa Przyokopowa Spółka z ograniczoną odpowiedzialnością and the debtor. Under the said commitment the Company guaranteed, among other things, that:
- The Seller would perform the obligations and discharge the liabilities of Warszawa Przyokopowa, acting as the Seller, arising from agreements covering the subject-matter of the Transaction, and
- The Company would incur debts of WP arising from obligations and liabilities of WP under the FSPA, if the Seller has ceased its operations, has gone into liquidation or has been dissolved, which circumstances were described in the surety arrangements,
- The contractual penalty would be paid, should the Purchaser withdraw from the agreement due to reasons attributable to the Seller.
Apart from the aforesaid contingent liabilities arising from security for bank loans contingent fees relating to the removal of trees and arising from the real property sales and purchase agreements entered into, as at 30 June 2020, the Company did not have any other significant contingent liabilities.
23. Court Proceedings
As at 30 June 2020, there were no significant proceedings before the court or arbitration or public administration authorities with regard to liabilities or receivables of Develia S.A., the value of which would have an important bearing on the financial standing of the Company. The Company is a party to court and public administration proceedings whose value is insignificant for its operations or financial standing. Each case is examined individually in terms of its relevance for the company.
31
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020
(PLN '000)
24. Transactions with Related Undertakings
The following tables show the total amounts of transactions concluded with related undertakings for the period of 6 months ended 30 June 2020 (audited), for the period of 6 months ended 30 June 2019 (unaudited) and for the period ended 31 December 2019 (audited):
The following table shows the total amounts of transactions concluded with related undertakings for the period ended 30 June 2020 (audited):
Borrowings and | Financial | Financial | |||||||
Trade | non-current | ||||||||
Trade and other | Financial | income | expenses | ||||||
Related undertaking | Sale | Purchases | and other | receivables and | |||||
receivables | Liabilities | (interest, | (interest, | ||||||
payables | current financial | ||||||||
dividends) | discounts) | ||||||||
assets | |||||||||
Subsidiary undertakings | |||||||||
Arkady Wrocławskie S.A. | 2020 | 862 | 1,324 | 161 | 12 | 23,955 | 6,182 | 1,320 | 159 |
Sky Tower S.A. | 2020 | 1,416 | - | 252 | - | 14,784 | - | 163 | - |
Warszawa Przyokopowa Sp. z o.o. | 2020 | 2,385 | 81 | 92 | - | - | 96,371 | 131,334 | 2,879 |
Kraków Zielony Złocień Sp. z o.o. | 2020 | 562 | - | 105 | - | 2,217 | - | 58,117 | - |
LC Corp Invest I Sp. z o.o. | 2020 | 34 | - | 6 | - | 11,788 | - | 294 | - |
LC Corp Invest II Sp.z o.o. | 2020 | 33 | - | 9 | - | 457 | - | 9 | - |
LC Corp Invest III Sp. z o.o. | 2020 | 100 | - | 19 | - | 5,419 | - | 6,121 | - |
LC Corp Invest VII Sp. z o.o. | 2020 | 178 | - | 54 | - | 16,363 | - | 5,619 | - |
LC Corp Invest VIII Sp.z o.o. | 2020 | 737 | 17 | 137 | 4 | - | - | 10,300 | - |
LC Corp Invest IX Sp.z o.o. | 2020 | 179 | - | 22 | - | 10,600 | - | 150 | - |
LC Corp Invest X Sp.z o.o | 2020 | 610 | 15 | 69 | 4 | - | - | 8,000 | - |
LC Corp Invest XI Sp.z o.o. | 2020 | 13 | - | 1 | - | - | - | 1,662 | - |
LC Corp Invest XII Sp. z o.o. | 2020 | 297 | 4 | 54 | 3 | - | - | 14,853 | - |
LC Corp Invest XV Sp. z o.o. | 2020 | 28 | - | - | - | - | - | 1,232 | - |
LC Corp Invest XV Sp. z o.o.Projekt 1 Sp.k | 2020 | - | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 2 Sp.k | 2020 | 1,051 | 20 | 246 | 9 | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 3 Sp.k | 2020 | - | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 4 Sp.k | 2020 | 345 | - | 77 | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 5 Sp.k | 2020 | - | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 6 Sp.k | 2020 | 148 | - | 23 | 6 | - | - | - | - |
32
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020
(PLN '000)
LC Corp Invest XV Sp. z o.o.Projekt 7 Sp.k | 2020 | 133 | 34 | 45 | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 8 Sp.k | 2020 | 444 | - | 98 | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 9 Sp.k | 2020 | 142 | - | 23 | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 10 Sp.k | 2020 | 161 | - | 21 | 1 | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 11 Sp.k | 2020 | 237 | - | 51 | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 12 Sp.k. | 2020 | - | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 14 Sp.k. | 2020 | - | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Finance S.K.A. | 2020 | - | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Investments S.K.A. | 2020 | 10 | - | 1 | - | - | - | - | - |
LC Corp Invest XVI Sp. z o.o. | 2020 | 10 | - | 1 | - | - | - | - | - |
LC Corp Invest XVII Sp. z o.o. | 2020 | 10 | - | - | - | - | - | 500 | - |
LC Corp Invest XVII Sp. z o.o.Projekt 20 Sp.k | 2020 | 69 | - | 12 | - | - | 84,852 | - | 2,178 |
LC Corp Invest XVII Sp. z o.o.Projekt 21 Sp.k | 2020 | 73 | - | 14 | - | - | - | - | - |
LC Corp Invest XVII Sp. z o.o.Projekt 22 Sp.k | 2020 | 671 | - | 240 | - | - | - | - | - |
LC Corp Invest XVIII Sp. z o.o. | 2020 | - | - | - | - | - | - | - | - |
LC Corp Invest XVIII Sp. z o.o. Real Estate S.K.A. | 2020 | - | - | - | - | - | - | - | - |
LC Corp Invest XIX Sp. z o.o. w likwidacji | 2020 | 2 | - | - | - | - | - | - | - |
LC Corp Invest XXI Sp. z o.o. | 2020 | 51 | - | 15 | - | 11,706 | - | 269 | - |
LC Corp Invest XXII Sp. z o.o. | 2020 | 10 | - | 1 | - | - | - | - | - |
LC Corp Invest XXIII Sp. z o.o. w likwidacji | 2020 | 2 | - | - | - | - | - | - | - |
- | - | - | - | ||||||
LC Corp Invest XXIV Sp. z o.o. | 2020 | 12 | 1 | 11,046 | 268 | ||||
LC Corp Service S.A. | 2020 | 139 | - | 22 | - | - | - | - | - |
- | - | - | - | ||||||
Develia Invest Sp. z o.o. | 2020 | 38 | 10 | 23,927 | 598 | ||||
Total | 2020 | 11,192 | 1,495 | 1,882 | 39 | 121,216 | 198,451 | 240,541 | 5,484 |
Management and Supervisory Board*) | |||||||||
Management Board | 2020 | 3,999 | - | - | - | - | - | - | - |
Supervisory Board | 2020 | 296 | - | - | - | - | - | - | - |
(*) remuneration |
The Company also received funds from the liquidation of subsidiaries (see Note 3 and 12) amounting to PLN 72,000.
33
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020
(PLN '000)
The following table shows the total amounts of transactions concluded with related undertakings for the year ended 31 December 2019 (audited):
Borrowings and | Financial | Financial | |||||||
Trade | non-current | ||||||||
Trade and other | Financial | income | expenses | ||||||
Related undertaking | Sale | Purchases | and other | receivables and | |||||
receivables | Liabilities | (interest, | (interest, | ||||||
payables | current financial | ||||||||
dividends) | discounts) | ||||||||
assets | |||||||||
Subsidiary undertakings | |||||||||
Arkady Wrocławskie S.A. | 2019 | 2,247 | 2,565 | 776 | 290 | 21,597 | 6,023 | 420 | 210 |
Sky Tower S.A. | 2019 | 3,608 | 2 | 1,896 | 18 | - | - | - | - |
Warszawa Przyokopowa Sp. z o.o. | 2019 | 1,661 | 853 | 550 | 69 | - | 66,004 | - | 1,394 |
Kraków Zielony Złocień Sp. z o.o. | 2019 | 1,709 | 267 | 344 | 10 | - | - | 89,507 | - |
LC Corp Invest I Sp. z o.o. | 2019 | 86 | - | 29 | - | 11,640 | - | 4,010 | - |
LC Corp Invest II Sp.z o.o. | 2019 | 51 | - | 11 | 6 | 253 | - | 3 | - |
LC Corp Invest III Sp. z o.o. | 2019 | 314 | - | 46 | - | 5,331 | - | 601 | - |
LC Corp Invest VII Sp. z o.o. | 2019 | 271 | - | 53 | - | 15,381 | - | 10,412 | - |
LC Corp Invest VIII Sp.z o.o. | 2019 | 1,241 | 29 | 267 | 13 | - | - | 406 | - |
LC Corp Invest IX Sp.z o.o. | 2019 | 362 | - | 199 | - | - | - | - | - |
LC Corp Invest X Sp.z o.o | 2019 | 4,064 | 6,811 | 107 | 8 | - | - | 55,437 | - |
LC Corp Invest XI Sp.z o.o. | 2019 | 37 | - | 17 | - | - | - | - | - |
LC Corp Invest XII Sp. z o.o. | 2019 | 805 | - | 107 | 43 | - | - | 26,437 | - |
LC Corp Invest XV Sp. z o.o. | 2019 | 43 | - | 5 | 13 | - | - | 453 | - |
LC Corp Invest XV Sp. z o.o.Projekt 1 Sp.k | 2019 | 52 | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 2 Sp.k | 2019 | 2,085 | 332 | 395 | 171 | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 3 Sp.k | 2019 | 37 | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 4 Sp.k | 2019 | 1,184 | - | 183 | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 5 Sp.k | 2019 | 43 | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 6 Sp.k | 2019 | 684 | 15 | 54 | 12 | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 7 Sp.k | 2019 | 205 | 51 | 62 | 7 | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 8 Sp.k | 2019 | 595 | - | 201 | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 9 Sp.k | 2019 | 754 | - | 61 | 75 | - | - | - | - |
34
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020
(PLN '000)
LC Corp Invest XV Sp. z o.o.Projekt 10 Sp.k | 2019 | 696 | 1 | 56 | 56 | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 11 Sp.k | 2019 | 986 | - | 71 | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 12 Sp.k. | 2019 | 6 | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 14 Sp.k. | 2019 | 27 | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Finance S.K.A. | 2019 | 6 | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Investments S.K.A. | 2019 | 30 | 39 | 5 | 33 | - | - | - | - |
LC Corp Invest XVI Sp. z o.o. | 2019 | 28 | - | 10 | - | - | - | - | - |
LC Corp Invest XVII Sp. z o.o. | 2019 | 26 | - | 8 | - | - | - | 3 | - |
LC Corp Invest XVII Sp. z o.o.Projekt 20 Sp.k | 2019 | 2,596 | - | 979 | - | - | 82,629 | 55,000 | 174 |
LC Corp Invest XVII Sp. z o.o.Projekt 21 Sp.k | 2019 | 1,833 | - | 329 | - | - | - | - | - |
LC Corp Invest XVII Sp. z o.o.Projekt 22 Sp.k | 2019 | 1,077 | - | 548 | - | - | - | - | - |
LC Corp Invest XVIII Sp. z o.o. | 2019 | 2 | - | - | - | - | - | - | - |
LC Corp Invest XVIII Sp. z o.o. Real Estate S.K.A. | 2019 | - | 3 | - | - | - | - | - | - |
LC Corp Invest XIX Sp. z o.o. w likwidacji | 2019 | 22 | - | 3 | - | - | - | 16 | - |
LC Corp Invest XXI Sp. z o.o. | 2019 | 94 | 4 | 10 | 19 | 11,512 | - | 549 | - |
LC Corp Invest XXII Sp. z o.o. | 2019 | 28 | 25 | 2 | - | - | - | 8 | - |
LC Corp Invest XXIII Sp. z o.o. w likwidacji | 2019 | 20 | - | 17 | - | - | - | - | - |
LC Corp Invest XXIV Sp. z o.o. | 2019 | 44 | 20,480 | - | - | - | - | 78 | - |
LC Corp Service S.A. | 2019 | 351 | - | 64 | - | - | - | - | - |
Develia Invest Sp. z o.o. | 2019 | 27,592 | 792 | 899 | - | 20,672 | - | 180 | - |
Total | 2019 | 57,602 | 32,269 | 8,364 | 843 | 86,386 | 154,656 | 243,520 | 1,778 |
Additionally, in the year ended 31 December 2019, the Company made capital contributions to its subsidiary undertakings which are described in Notes 5 and 17 of the Financial Statements for the period ended 31 December 2019.
The aforesaid data was adjusted on account of the merger with a subsidiary - LC Corp Invest XX Sp. z o.o., which occurred in the period ended 31 December 2019.
35
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020
(PLN '000)
The following table shows the total amounts of transactions concluded with related undertakings for the period of 6 months ended 30 June 2019 (unaudited):
Related undertaking
Subsidiary undertakings | |
Arkady Wrocławskie S.A. | 2019 |
Sky Tower S.A. | 2019 |
Warszawa Przyokopowa Sp. z o.o. | 2019 |
Kraków Zielony Złocień Sp. z o.o. | 2019 |
LC Corp Invest I Sp. Z o.o. | 2019 |
LC Corp Invest II Sp.z o.o. | 2019 |
LC Corp Invest III Sp. Z o.o. | 2019 |
LC Corp Invest VII Sp. z o.o. | 2019 |
LC Corp Invest VIII Sp.z o.o. | 2019 |
LC Corp Invest IX Sp.z o.o. | 2019 |
LC Corp Invest X Sp.z o.o. | 2019 |
LC Corp Invest XI Sp.z o.o. | 2019 |
LC Corp Invest XII Sp. Z o.o. | 2019 |
LC Corp Invest XV Sp. Z o.o. | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 1 Sp.k | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 2 Sp.k | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 3 Sp.k | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 4 Sp.k | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 5 Sp.k | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 6 Sp.k | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 7 Sp.k | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 8 Sp.k | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 9 Sp.k | 2019 |
LC Corp Invest XV Sp. z o.o.Projekt 10 Sp.k | 2019 |
Borrowings and | Financial | Financial | |||||
Trade | non-current | ||||||
Trade and other | Financial | income | expenses | ||||
Sale | Purchases | and other | receivables and | ||||
receivables | Liabilities | (interest, | (interest, | ||||
payables | current financial | ||||||
dividends) | discounts) | ||||||
assets | |||||||
870 | 1,457 | 599 | 29 | 21,430 | 5,973 | 171 | 333 |
1,288 | - | 612 | - | - | - | - | - |
636 | 430 | 173 | 13 | - | 65,711 | - | 963 |
889 | - | 214 | - | 34,199 | - | 51,621 | - |
34 | - | 6 | - | 87,689 | - | 2,761 | - |
29 | - | 5 | - | 51 | - | 1 | - |
154 | - | 18 | - | 11,864 | - | 296 | - |
113 | - | 19 | - | 19,892 | - | 4,607 | - |
544 | - | 201 | - | 8,140 | - | 197 | - |
85 | - | 19 | - | - | - | - | - |
3,638 | 30 | 81 | 4 | - | - | 37,237 | - |
10 | - | 1 | - | - | - | - | - |
519 | - | 53 | - | - | - | 26,437 | - |
28 | - | 5 | - | - | - | 453 | - |
52 | - | - | - | - | - | - | - |
1,046 | 72 | 402 | 14 | - | - | - | - |
37 | - | - | - | - | - | - | - |
668 | - | 194 | - | - | - | - | - |
43 | - | - | - | - | - | - | - |
396 | 15 | 77 | - | - | - | - | - |
81 | 3 | 23 | 6 | - | - | - | - |
201 | - | 40 | - | - | - | - | - |
492 | - | 99 | - | - | - | - | - |
426 | - | 111 | - | - | - | - | - |
36
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020
(PLN '000)
LC Corp Invest XV Sp. z o.o.Projekt 11 Sp.k | 2019 | 685 | - | 148 | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 12 Sp.k | 2019 | 6 | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. z o.o.Projekt 14 Sp.k | 2019 | 27 | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. Z o.o.Finance S.K.A. | 2019 | 6 | - | - | - | - | - | - | - |
LC Corp Invest XV Sp. Z o.o.Investments S.K.A. | 2019 | 28 | - | 5 | - | - | - | - | - |
LC Corp Invest XVI Sp. Z o.o. | 2019 | 10 | - | 1 | - | - | - | - | - |
LC Corp Invest XVII Sp. Z o.o. | 2019 | 10 | - | 1 | - | 30 | - | - | - |
LC Corp Invest XVII Sp. z o.o.Projekt 20 Sp.k | 2019 | 314 | - | 93 | - | - | - | - | - |
LC Corp Invest XVII Sp. z o.o.Projekt 21 Sp.k | 2019 | 202 | - | 79 | - | - | - | - | - |
LC Corp Invest XVII Sp. z o.o.Projekt 22 Sp.k | 2019 | 294 | - | 94 | - | - | - | - | - |
LC Corp Invest XVIII Sp. Z o.o. | 2019 | 2 | - | - | - | - | - | - | - |
LC Corp Invest XVIII Sp. Z o.o. Real Esate SKA | 2019 | 0 | 3 | - | - | - | - | - | - |
LC Corp Invest XIX Sp. Z o.o. | 2019 | 10 | - | 1 | - | - | - | 18 | - |
LC Corp Invest XXI Sp. Z o.o. | 2019 | 57 | - | 9 | - | 10,823 | - | 263 | - |
LC Corp Invest XXII Sp. Z o.o. | 2019 | 10 | - | 1 | - | - | - | 8 | - |
LC Corp Invest XXIII Sp. Z o.o. | 2019 | 10 | - | 1 | - | - | - | - | - |
LC Corp Invest XXIV Sp. Z o.o. | 2019 | 10 | - | 1 | - | - | - | 82 | - |
LC Corp Service S.A. | 101 | - | 61 | - | - | - | - | ||
Develia Sp. z o.o. | 4 | - | 1 | - | - | - | - | ||
Total | 2019 | 14,063 | 2,011 | 3,451 | 66 | 194,119 | 71,685 | 124,153 | 1,296 |
Management and Supervisory Board*) | |||||||||
Management Board | 2019 | 8,134 | - | - | - | - | - | - | - |
Supervisory Board | 2019 | 306 | - | - | - | - | - | - | - |
(*) remuneration |
Additionally, in the period of 6 months ended 30 June 2020, the Company made capital contributions to its subsidiary undertakings which are described in Notes 3 and 12 of the Financial Statements for the
period ended 30 June 2019.
37
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
24.1. Payment of Dividend by Develia S.A.
On 31 August 2020, the Ordinary General Meeting of Develia S.A. adopted a resolution on the payment of dividend on the following principles:
- Amount of dividend: PLN 44,755,831.10
- Amount of dividend per share: PLN 0.10
- Number of shares subject to dividend: 447,558,311 shares
- Record date: 18 September 2020
- Dividend payment date: 02 October 2020
24.2. Payment of Dividend by Subsidiary Undertakings
- Under the Resolution of the Ordinary General Meeting of Warszawa Przyokopowa Sp. z o.o. carried on 25 March 2020, dividend for 2019 in the amount of PLN 131,300,000 was paid to Develia S.A. on 31 March 2020.
- Under the Resolution of the Ordinary General Meeting of LC Corp Invest III Sp. z o.o. carried on 6 April 2020, dividend for 2019 in the amount of PLN 6,000,000 was paid to Develia S.A. on 8 April 2020.
- Under the Resolution of the Ordinary General Meeting of LC Corp Invest XV Sp. z o.o. carried on 6 April 2020, dividend for 2019 in the amount of PLN 1,232,000 was paid to Develia S.A. 8 April 2020.
-
Under the Resolution of the Ordinary General Meeting of Kraków Zielony Złocień Sp. z o.o. carried on
6 April 2020, dividend for 2019 in the amount of PLN 58,100,000 was paid to Develia S.A. on 8 April 2020. - Under the Resolution of the Ordinary General Meeting of LC Corp Invest XII Sp. z o.o. carried on 6 April 2020, dividend for 2019 in the amount of PLN 14,853,000 was paid to Develia S.A. on 8 April 2020.
- Under the Resolution of the Ordinary General Meeting of LC Corp Invest X Sp. z o.o. carried on 6 April 2020, dividend for 2019 in the amount of PLN 8,000,000 was paid to Develia S.A. on 8 April 2020.
- Under the Resolution of the Ordinary General Meeting of LC Corp Invest XVII Sp. z o.o. carried on 6 April 2020, dividend for 2019 in the amount of PLN 500,000 was paid to Develia S.A. on 16 April 2020.
- On 16 June 2020, the Ordinary General Meeting of LC Corp Invest VII Sp. z o.o. passed a resolution on the payment of dividend for 2019 to Develia S.A. in the amount of PLN 5,274,000. As at 30 June 2020, dividend was not paid.
- On 16 June 2020, the Ordinary General Meeting of LC Corp Invest VIII Sp. z o.o. passed a resolution on the payment of dividend for 2019 to Develia S.A. in the amount of PLN 10,300,000. As at 30 June 2020, dividend was not paid.
38
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
25. Financial Instruments
25.1. Fair Values
The table below shows the balance sheet values of all financial instruments of the Company in a breakdown by respective categories of assets and liabilities, pursuant to IFRS 9:
Balance sheet value | |||
30 June 2020 | 31 December | ||
2019 | |||
(audited) | |||
(audited) | |||
Assets measured at fair value through profit or loss: | |||
Borrowings granted | 120,865 | 86,385 | |
120,865 | 86,385 | ||
Assets measured at amortised cost: | |||
Cash and Cash Equivalents (including cash in trust accounts) | 249,278 | 41,484 | |
Trade and other receivables (net of budget receivables) | 20,108 | 30,090 | |
269,386 | 71,574 | ||
Financial liabilities measured at amortised cost: | |||
Trade and other payables (net of budget liabilities) | 37,826 | 32,558 | |
Loans, bonds and borrowings at a floating interest rate | 542,809 | 567,043 | |
Loans, bonds and borrowings at a fixed interest rate | 51,448 | 50,328 | |
632,083 | 649,929 |
The fair values of the above presented items are close to their balance sheet values.
26. Capital Management
The main purpose of the Company's capital management is to maintain a good credit rating and safe capital ratios which would support the Company's operating activity and increase the value for its shareholders.
The Company manages the capital structure and modifies it as a result of changes in economic conditions. In order to maintain or adjust the capital structure, the Company can change the payment of dividend to shareholders, return capital to shareholders or issue new shares. In the period ended 30 June 2020 and in the year ended 31 December 2019, there were no changes in the objectives, rules and processes binding in this area.
The Company monitors the condition of capital by means of a leverage ratio, which is calculated as a relation of debt to equity. The Company's rules determine this ratio as not higher than 5. The Company's debt includes interest-bearing loans and borrowings, trade payables and other liabilities.
30 June 2020 | 31 December 2019 | |
(audited) | (audited) | |
Interest-bearing bonds, loans, notes and borrowings | 396,484 | 617,371 |
Trade and Other Payables | 38,877 | 34,996 |
A. Debt | 435,361 | 652,367 |
B. Equity | 1,175,315 | 893,683 |
Leverage ratio (A/B) | 0.37 | 0.73 |
39
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
27. Effects of Announcement of COVID-19 Epidemic on Group's Current Operations
An important factor that affected the Company's current operations in H1 2020 was the state of COVID-19 epidemic announced in that period.
January and February 2020 saw very good sales, however, after that period the Company recorded a significant drop in the number of new sales contracts concluded in April 2020, and although May and June saw increasing sales volume, the result for the entire quarter and half year was worse than in corresponding periods of 2019.
After the balance-sheet date, i.e. in the period between July and August 2020, the higher number of flats sold could be observed. Consequently, the current sales figures give an optimistic outlook on the situation of the housing market and its prospects.
In Q2, due to an outbreak of the epidemic, the Company decided to change its investment plan, delaying the implementation of some housing projects, starting to phase individual projects over a longer period and changing the order of construction works for multi-stage projects - with next stages being chosen for implementation in consideration of a changing market situation.
Furthermore, the Company also noted a delay in the process of issuing administrative decisions, e.g. decisions on building permit, which stemmed from the fact that time limits for administrative authorities to give such decisions were suspended on account of the epidemic.
The Management Board monitor, on a daily basis, works progress on sites, and no major effects of the epidemic on project schedules were observed. As regards projects already completed and scheduled to be completed in this year, no delays in delivering premises to clients are envisaged by the Company.
The fact of announcing the COVID-19 pandemic has not affected the liquidity of the Company dramatically and it has had no significant bearing on the valuation of major financial items (such as inventory, receivables, shares and provisions).
28. Events After End of Reporting Period
- LC Corp Invest XIX Sp. z o.o. was removed from the National Court Register (KRS) on 14 July 2020.
- On 3 July 2020, the Company purchased real estate of 0.9998 ha located at Ptasia Street in Gdańsk, designated for a development project.
- On 20 July 2020, Develia S.A. completed the early redemption of 46,000 four-year unsecured coupon bonds of PLN 1,000 each and a total nominal value of PLN 46,000,000.
- On 28 August 2020, a resignation from the Supervisory Board, effective as at 31 August 2020, was tendered by the Supervisory Board Chairman - Michał Hulbój.
- On 30 August 2020, a resignation from the Supervisory Board, effective as at 31 August 2020, was tendered by the Supervisory Board Member - Grzegorz Grabowicz.
- On 31 August 2020, a resignation from the Supervisory Board, effective as at 31 August 2020, was tendered by the Supervisory Board Member - Michał Wnorowski.
- On 31 August 2020, the Ordinary General Meeting of Develia S.A. adopted a resolution on the payment of dividend in the amount of PLN 44,755,831.10 (PLN 0.10 per share), setting the record date for 18 September 2020 and the date of dividend payment for 2 October 2020.
-
On 31 August 2020, the Ordinary General Meeting of Develia S.A. appointed Mr Robert Pietryszyn, Mr
Piotr Pinior and Mr Marek Szydło to the Supervisory Board. - On 31 August 2020, the Ordinary General Meeting of Develia S.A. adopted a resolution on the merger pursuant to Article 492(1)(1) of the Commercial Partnerships and Companies Code between Develia
S.A. and LC Corp Invest XXI Sp. z o.o., based in Wrocław ("the Acquired Company 1") and LC Corp Invest XXIV Sp. z o.o., based in Wrocław, ("the Acquired Company 2") through the transfer to the Acquiring Company - as the sole shareholder in the Acquired Company 1 and 2 - of the entire assets
40
Develia S.A.
Condensed Interim Financial Statements for the period of 6 months ended 30 June 2020 (PLN '000)
of both Acquired Companies (merger through take-over). Relevant resolutions were carried on the same day by the Acquired Company 1 and the Acquired Company 2.
- On 31 August 2020, the Ordinary General Meeting of the Issuer adopted the Remuneration Policy for Management Board and Supervisory Board Members.
- On 2 September 2020, the Issuer communicated its intention to issue bonds as part of a bond issue scheme up to the total amount (nominal value) of issued and outstanding bonds of PLN 400,000,000, with such issuance being subject, however, to satisfactory conditions on the debt securities market (maturity - three years, floating interest rate).
- On 7 September 2020, Marek Szydło tendered his resignation from the Supervisory Board, which was effective as from 8 September 2020.
Apart from the foregoing, no other event that could significantly influence the Company's financial results occurred after 30 June 2020.
The document has been signed by a qualified electronic signature | ||
Paweł Ruszczak | Mirosław Kujawski | Tomasz Wróbel |
acting President of Management | Member of Management Board | Member of Management Board |
Board | ||
Lidia Kotowska | Anna Gremblewska-Nowak | |
Director of Accounting | Chief Accountant | |
Department |
Wrocław, 08 September 2020
41
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Develia SA published this content on 30 September 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 September 2020 21:49:02 UTC
