Afarak Group Plc Additional Information Related To Quarterly Report
May 17 2017 - 9:05AM
UK Regulatory
TIDMAFAGR
15:00 London, 17:00 Helsinki, 17 May 2017 - Afarak Group Plc ("Afarak"
or "the Company") (LSE: AFRK, NASDAQ: AFAGR)
ADDITIONAL INFORMATION RELATED TO QUARTERLY REPORT
The company wishes to make available to all shareholders certain
clarifications discussed and/or requested during the investor call,
relating to the first quarter results (published on May 12, 2017) and
with respect to: 1) currency movements that were being accounted for in
equity and moved to the income statement; and, 2) tax charge.
1. Currency movements
The Company is simplifying and improving its corporate structures and
its balance sheet making it also more transparent in order to pursue
further investments in the development of its mining operations in South
Africa. This restructuring included the repayment of the internal loans
originated back in 2010 and 2011, with the foreign exchange difference
arising from the time differences in South African rand against hard
currencies, calculated between the origination and repayment dates. This
cumulative unrealised exchange difference has been recorded in the
"Other Comprehensive Income" and "Translation reserve" in equity.
Following IFRS, when realised the accumulated exchange loss of EUR 3.2
million is recognised as a finance cost in the "Income Statement", and
the corresponding offsetting reduction in the "Translation Reserve" is
recognised within the change in the Translation Reserve in "Other
Comprehensive Income". This realised exchange difference and the
offsetting positive movement in the Translation difference, has no net
impact on the shareholders equity and, as a result, the Group's total
comprehensive income is EUR 8.3 million.
2. Tax charge
The reported tax charge of EUR 2.7 million during the first quarter was
higher than usual on the back of the significantly improved result
achieved during the period. The tax charge also included a one-off
write-off of deferred tax asset amounting to EUR 1.1 million on foreign
exchange difference on the historical intragroup loans that are unlikely
to be utilised in the taxation of the relevant subsidiary in the short
to medium term. The effective tax rate when excluding the write-off was
23.2%. The reported tax charge is provisional for the period and will
fluctuate going forward, depending on Company's profitability in the
coming quarters.
The necessary charges and currency movements, due to compliance with
IFRS, have also not influenced the proposed capital redemption of EUR
0.02, which is reflective of strong operating cash flows, rather than
the declared bottom line profit figure, affected by these book entries.
Further the Company wishes to inform that the Capital redemption
proposed to the AGM will be paid, if accepted, on 9 June and not on 10
June as previously communicated.
Guy Konsbruck
CEO
Afarak Group plc
www.afarak.com
For additional information, please contact:
Guy Konsbruck, CEO, +356 2122 1566, guy.konsbruck@afarak.com
Predrag Kovacevic, CFO, +356 2122 1566, pedja.kovacevic@afarak.com
Melvin Grima, Finance Director, +356 2122 1566, melvin.grima@afarak.com
Jean Paul Fabri, PR Manager, +356 2122 1566, jp.fabri@afarak.com
This announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the information
contained therein.
Source: Afarak Group via Globenewswire
http://www.afarakgroup.com
(END) Dow Jones Newswires
May 17, 2017 10:05 ET (14:05 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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