TIDMDNA2
RNS Number : 2933I
Doric Nimrod Air Two Limited
10 December 2020
DORIC NIMROD AIR TWO LIMITED (the "Company")
(Legal Entity Identifier: 213800ENH57LLS7MEM48)
HALF-YEARLY FINANCIAL REPORT
The Board of the Company is pleased to announce its results for
the period from 1 April 2020 to 30 September 2020.
To view the Company's half-yearly financial report please follow
the link below:
http://www.rns-pdf.londonstockexchange.com/rns/2933I_1-2020-12-10.pdf
In addition, to comply with DTR 6.3.5(1) please find below the
full text of the half yearly financial report.
The half-yearly financial report will also shortly be available
on the Company's website www.dnairtwo.com .
For further information, please contact:
For administrative and company information:
JTC Fund Solutions (Guernsey) Limited
+44 (0) 1481 702400
For shareholder information:
Nimrod Capital LLP
+44 (0) 20 7382 4565
OF ANNOUNCEMENT
E&OE - in transmission
Doric Nimrod Air Two Limited
Half-Yearly Financial Report
For the period from 1 April 2020 to 30 September 2020
S U MM A RY I N F O R M A T ION
Listing Specialist Fund Segment of the London
Stock Exchange's Main Market
Ticker DNA2
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Share Price 63.5 pence (as at 30 September 2020)
80.0 pence (as at 4 December 2020)
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Market Capitalisation GBP 138.2 million (as at 4 December
2020)
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Current and Targeted Dividend 4.5 pence per quarter per share (18
pence per annum)
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Dividend Payment Dates January, April, July, October
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Currency Sterling
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Launch Date/Price 14 July 2011 / 200 pence
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Incorporation and Domicile Guernsey
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Aircraft Registration A6 - EDP (14 October 2023),
Numbers (Lease Expiry A6 - EDT (2 December 2023),
Dates including the 2 A6 - EDX (1 October 2024),
year extension) A6 - EDY (1 October 2024),
A6 - EDZ (12 October 2024),
A6 - EEB (9 November 2024),
A6 - EEC (30 November 2024)
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Asset Manager Doric GmbH
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Corporate and Shareholder Nimrod Capital LLP
Advisor
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Administrator JTC Fund Solutions (Guernsey) Ltd
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Auditor Deloitte LLP
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Market Makers finnCap Ltd,
Investec Bank,
Jefferies International Ltd,
Numis Securities Ltd,
Shore Capital Ltd,
Winterflood Securities Ltd
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SEDOL, ISIN, LEI B3Z6252 , GG00B3Z62522, 213800ENH57LLS7MEM48
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Year End 31 March
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Stocks & Shares ISA Eligible
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Website www.dnairtwo.com
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Please note that the Group has determined that the operating
leases on the Assets are for 12 years based on an initial term of
10 years followed by an exercised extension term of two years.
COMPANY OVERVIEW
Doric Nimrod Air Two Limited ("DNA2" or the "Company") is a
Guernsey company incorporated on 31 January 2011.
Pursuant to the Company's prospectus dated 30 June 2011, the
Company, on 14 July 2011, raised approximately GBP136 million by
the issue of 72,500,000 ordinary preference shares (the "Placing").
The nominal value of the issued shares was 200 pence per share. The
Company's ordinary preference shares were admitted to trading on
the Specialist Fund Segment ("SFS") of the London Stock Exchange's
Main Market on 14 July 2011.
The Company raised a further GBP188.5 million at 200 pence per
share from a C share fundraising (the "C Shares"), which closed on
27 March 2012 with the admission of 100,250,000 convertible
preference shares to trading on the SFS.
On 6 March 2013, the Company's C Shares converted into an
additional 100,250,000 ordinary preference shares. These additional
ordinary preference shares were admitted to trading on the SFS and
rank pari passu with the ordinary preference shares already in
issue.
As at 4 December 2020, the last practicable date prior to the
publication of this report, the Company's total issued share
capital consisted of 172,750,000 ordinary preference shares (the
"Shares") and these Shares were trading at 80.0 pence per
Share.
Investment Objectives and Policy
The Company's investment objective is to obtain income returns
and a capital return for its shareholders (the "Shareholders") by
acquiring, leasing and then selling aircraft (each an "Asset" or
"Aircraft" and together the "Assets" or "Aircraft"). The Company
receives income from the lease rentals paid to it by Emirates, the
national carrier owned by the Investment Corporation of Dubai,
based in Dubai, United Arab Emirates, pursuant to the leases.
Subsidiaries
The Company has four wholly-owned subsidiaries: MSN077 Limited,
MSN090 Limited, MSN105 Limited and Doric Nimrod Air Finance Alpha
Limited ("DNAFA") which collectively hold the Assets for the
Company. Together the Company and the subsidiaries are known as the
"Group".
The first Asset was acquired by MSN077 Limited on 14 October
2011 for a purchase price of $234 million and has been leased to
Emirates for an initial term of 10 years to October 2021, with an
exercised extension period of 2 years ending October 2023, with
fixed lease rentals for the duration.
The second Asset was acquired by MSN090 Limited on 2 December
2011 for a purchase price of $234 million and has been leased to
Emirates for an initial term of 10 years to December 2021, with an
exercised extension period of 2 years ending December 2023, with
fixed lease rentals for the duration.
The third Asset was acquired by MSN105 Limited on 1 October 2012
for a purchase price of $234 million and has been leased to
Emirates for an initial term of 10 years to October 2022, w ith an
exercised extension period of 2 years ending October 2024, in which
rental payments reduce.
The fourth Asset, MSN 106, was acquired by DNAFA on 1 October
2012 for a purchase price of $234 million and has been leased to
Emirates for an initial term of 10 years ending October 2022, with
an exercised extension period of 2 years ending October 2024, in
which rental payments reduce.
The fifth Asset, MSN 107, was acquired by DNAFA on 12 October
2012 for a purchase price of $234 million and has been leased to
Emirates for an initial term of 10 years ending October 2022, with
an exercised extension period of 2 years ending October 2024, in
which rental payments reduce.
The sixth Asset, MSN 109, was acquired by DNAFA on 9 November
2012 for a purchase price of $234 million and has been leased to
Emirates for an initial term of 10 years ending November 2022, with
an exercised extension period of 2 years ending November 2024, in
which rental payments reduce.
The seventh Asset, MSN 110, was acquired by DNAFA on 30 November
2012 for a purchase price of $234 million and has been leased to
Emirates for an initial term of 10 years ending November 2022, with
an exercised extension period of 2 years ending November 2024, in
which rental payments reduce.
The fourth, fifth, sixth and seventh Assets were acquired by
DNAFA using the proceeds of the issue of the C Shares, together
with the proceeds of Equipment Notes (the "Equipment Notes") issued
by DNAFA. The Equipment Notes were acquired by two separate pass
through trusts using the proceeds of their issue of EETCs. The
EETCs, with an aggregate face amount of approximately $587.5
million were admitted to the Official List of the UK Listing
Authority and to the London Stock Exchange on 12 July 2012.
In order to complete the purchase of the related Assets, MSN077
Limited, MSN090 Limited and MSN105 Limited entered into separate
loan agreements with a number of banks (see note 15), each of which
will be fully amortised with quarterly repayments in arrears over
12 years (each of them a "Loan", together the "Loans"). A fixed
rate of interest applies to the Loans except for 50 per cent. of
the loan in MSN090 Limited which has a related interest rate swap
entered into to fix the interest rate. MSN077 Limited drew down
$151,047,059 under the terms of the first loan agreement to
complete the purchase of the first Asset; MSN090 Limited drew down
$146,865,575 in accordance with the second loan agreement to
finance the acquisition of the second Asset; and MSN105 Limited
drew down $145,751,153 in accordance with the third loan agreement
to finance the acquisition of the third Asset. The first loan
agreement, the second loan agreement and the third loan agreement
are on materially the same terms.
Emirates bears all costs (including maintenance, repair, and
insurance) relating to the Aircraft during the lifetime of the
leases.
Further information about the construction of these leases is
available in note 12 to the financial statements.
Distribution Policy
The Company currently targets a distribution of 4.5 pence per
Share per quarter.
There can be no guarantee that dividends will be paid to
Shareholders and, if dividends are paid, as to the timing and
amount of any such dividend. There can also be no guarantee that
the Company will, at all times, satisfy the solvency test required
to be satisfied pursuant to section 304 of The Companies (Guernsey)
Law, 2008, as amended (the "Law") enabling the Board of Directors
(the "Directors") to effect the payment of dividends.
Performance Overview
All payments by Emirates have, to date, been made in accordance
with the terms of the respective Leases.
During the period under review, and in accordance with the
Distribution Policy, the Company declared two interim dividends of
4.5 pence per Share. One interim dividend of 4.5 pence per Share
was declared after the reporting period. Further details of these
dividend payments can be found on page 30.
Return of Capital
In respect of any Asset, following a sale of that Asset, the
Directors may, either (i) return to Shareholders the net proceeds,
or (ii) re-invest such proceeds in accordance with the Company's
investment policy.
The Company intends to return to Shareholders net capital
proceeds if and when the Company is wound-up (pursuant to a
Shareholder resolution, including the Liquidation Resolution
below), subject to compliance with the Company's Articles of
Incorporation (the "Articles") and the applicable laws (including
any applicable requirements of the solvency test contained
therein).
Liquidation Resolution
Although the Company does not have a fixed life, the Articles
require that the Directors convene a general meeting of the Company
in June 2025 where an ordinary resolution will be proposed that the
Company proceed to an orderly wind-up (the "Liquidation
Resolution"). In the event that the Liquidation Resolution is not
passed, the Directors will consider alternatives for the future of
the Company, including re-leasing the Assets, or selling the Assets
and reinvesting the capital received from the sale of the Assets in
other aircraft.
C H A I R ' S S T A TE M ENT
During the period from 1 April 2020 until 30 September 2020 (the
"Period") the Company has declared and paid two quarterly dividends
of 4.5 pence per share each, a rate of dividend payment equivalent
to 18 pence per share per annum.
The Company's investment objective is to obtain income returns
and a capital return for its Shareholders by acquiring, leasing and
then selling aircraft. The Company has four wholly-owned
subsidiaries: MSN077 Limited, MSN090 Limited, MSN105 Limited and
DNAFA. The Group owns seven Assets, funded by two equity issues,
bank debt and a note issue in 2011 and 2012. Upon the purchase of
each aircraft (the "Aircraft"), the each subsidiary entered into a
10-year lease with Emirates, which in every case has been extended
by the exercise of a two year extension option, with pre-determined
lease rentals for the 12 year duration.
The debt portion of the funding is designed to be fully
amortised over the term of the leases, which would leave the
Aircraft unencumbered on the conclusion of the ultimate lease.
Emirates bears all costs (including maintenance, repair and
insurance) relating to the Aircraft during the lifetime of the
leases. At 4 December 2020, the latest practical date prior to this
report, the Company had outstanding debt associated with the
Aircraft totalling USD 211.7 million (24% of the initial balance)
as well as unencumbered cash resources of GBP 30 million. At the
time of writing the share price is 80.0 pence, representing a
market capitalisation of GBP 138.2 million based on the 172,750,000
shares in issue. The Company's first lease expiry falls due in
October 2023.
All payments by Emirates during the period and throughout the
lease have been made in accordance with the respective terms of the
leases.
Emirates, the sole lessee of the Company, has undertaken a
number of measures since the onset of COVID-19 to support its
business. These measures included the difficult decisions to cut
jobs, reduce staff wages and offer voluntary unpaid leave in order
to help reduce costs. The airline was also bolstered by its cargo
operations in response to increased demand. Further, as a means to
contain the outflow of cash, Emirates adopted the policy that no
operation is allowed to go below the cash operating cost.
Reassuringly, and according to Emirates's president Tim Clark, the
Airbus A380 has proven economically viable in this regard, as solid
load factors have led to profitable operations - although this is
in the context of only 14 of Emirates's 115 A380s currently being
in service at the time of writing. The Company's Aircraft are
stored at Dubai World Central (DWC). Perhaps the key development
during the period is that Emirates had received 7.3 billion dirhams
(USD 2 billion) from the Government of Dubai. The government of
Dubai sold USD 2 billion of dual tranche bonds in early September
with the USD 1 billion 30-year conventional bond pricing at a yield
of 4% according to Reuters. Emirates reinstated the full salaries
of its employees from the beginning of October.
In its recent half-year results Emirates Airline reported that
revenue fell by 75% resulting in a loss of USD 3.4 billion. Despite
the significant drop in operations during the six months, Emirates'
EBITDA was still positive at US 79 million with strong cargo
business supporting revenue. Emirates reported a cash position of
USD 4.25 billion as at 30 September 2020. His Highness Sheikh Ahmed
bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates noted
"No one can predict the future, but we expect a steep recovery in
travel demand once a COVID-19 vaccine is available, and we are
readying ourselves to serve that rebound."
Whilst Emirates do not have a formal credit rating they have
previously issued unsecured USD bonds with maturities in 2023, 2025
and 2028, At the time of writing these respective instruments are
trading at approximately par (100 cents) respectively, equivalent
to USD running yields in the range of roughly 3.9% to 4.5%. Further
details on Emirates and the A380 can be found in the Asset
Manager's report by Doric GmbH ("Doric").
Since my statement accompanying the Annual Report the
International Air Transport Association ("IATA") has forecast an
airline industry-wide net loss of USD 84.3 billion for this year.
Revenue passenger kilometres contracted by 73 per cent in the year
to September 2020.
The liquidity and creditworthiness of airlines, both large and
small, continues to be in focus while a significant part of the
global aircraft fleet remains grounded. IATA continues to see a
recovery to 2019 levels of passenger traffic by 2024.
Doric continues to monitor the lease and is in frequent contact
with the lessee and reports regularly to the Board. Nimrod Capital
LLP ("Nimrod" or the "Corporate and Shareholder Adviser") continues
to liaise with Shareholders on behalf of the Board and has provided
valuable feedback on the views of Shareholders in the current
climate.
Shareholders should note that while the underlying cash flows
received during the Period have been as anticipated, the financial
statements do not, in the Board's view, properly convey this
economic reality due to the accounting treatments for foreign
exchange, rental income and finance costs, as required by
International Financial Reporting Standards ("IFRS").
For instance, the entirety of the rental income that is
receivable under a 12 year lease is credited evenly over each of
the 144 months of the lease. However rental income is not received
in this uniform pattern, although it does closely match the
similarly uneven pattern of debt servicing and other payments. The
mismatch in timing between the receipt and recognition of rental
income results in large deferred income or accrued income balances
in the balance sheet.
Similarly, the relevant accounting standards require that
transactions denominated in currencies other than the presentation
currency (including, most importantly, the cost of the Aircraft)
are translated into the presentation currency at the exchange rate
ruling at the date of the transaction whilst monetary items
(including also very significantly, the outstanding borrowings and
the deferred income creditor) are translated at the rate prevailing
on the reporting date. The result is that the figures sometimes
show large mismatches which are reported as unrealised foreign
exchange differences - although the distortive effect becomes less
pronounced over time as debt is paid down and as a result of the
impairment adjustment.
On an on-going basis and assuming the lease rental is received,
and the loan payments are made as anticipated, such exchange
differences do not reflect the commercial substance of the
situation in the sense that the key transactions denominated in US
dollars are in fact closely matched. Rental income received in US
dollars is used to make loan repayments due which are likewise
denominated in US dollars. Furthermore, the US dollar lease rentals
and loan repayments are fixed at the inception of the respective
leases and are very similar in amount and timing.
The Board encourages Shareholders to read the Company's
quarterly fact sheets which we believe provide a great deal of
interesting information including a sensitivity analysis of the
potential returns to Shareholders, after lease expiry, under
different scenarios for A380 appraisal values. We hope these
regular reports, in addition to the communication you receive from
Nimrod, are useful and informative. The Directors welcome
Shareholder engagement and feedback and encourage you to contact
Nimrod to request a meeting or to relay any feedback.
Finally, on behalf of the Board, I would like to thank our
service providers for all their help and, most importantly, all
Shareholders for their continuing support of the Company during
these difficult times. I look forward to keeping all Shareholders
up to date with further progress.
Geoffrey Hall
Chair
10 December 2020
ASSET MANAGER'S REPORT
At the request of the Directors of the Company, this commentary
has been provided by the Asset Manager of the Company.
COVID-19
The impact of the COVID-19 pandemic on the aviation sector has
been significant with about a third of the global passenger
aircraft fleet still grounded. This Asset Manager's Report is
exclusively based on known facts at the time of writing and does
not seek to draw on any speculation about any possible future,
long-term impacts of the pandemic on the aviation sector or the
Company specifically and should be read in such context. The Board
notes the continuing market commentary regarding rental deferrals
and confirms that it has received no formal request from Emirates
to renegotiate their leases and that they are currently servicing
them in line with their obligations. The Board is in close contact
with the Asset Manager and its other advisors and will continue to
keep shareholders updated via quarterly fact sheets and ad-hoc
announcements as required.
1. The Assets
The Company acquired a total of seven Airbus A380-861 aircraft
between October 2011 and November 2012. Each aircraft is leased to
Emirates Airline ("Emirates") - the national carrier owned by the
Investment Corporation of Dubai, based in Dubai, United Arab
Emirates - for a term of 12 years from the point of delivery, with
fixed lease rentals for the duration. In order to complete the
purchase of the first three aircraft, MSN077 Limited, MSN090
Limited and MSN105 Limited entered into three separate loans, each
of which will be fully amortised with quarterly repayments in
arrears over 12 years.
The net proceeds from the C Share issue ("the Equity") were used
to partially fund the purchase of four of the seven Airbus A380s.
In order to help fund the acquisition of these final four aircraft,
DNAFA issued two tranches (Class A & Class B) of enhanced
equipment trust certificates ("the Certificates" or "EETC") - a
form of debt security - in June 2012 in the aggregate face value of
USD 587.5 million. The Certificates are admitted to the official
list of the Euronext Dublin and to trading on the Main Securities
market thereof. DNAFA used the proceeds from both the Equity and
the Certificates to finance the acquisition of four new Airbus A380
aircraft which were then leased to Emirates.
The seven Airbus A380 aircraft bear the manufacturer's serial
numbers (MSN) 077, 090, 105, 106, 107, 109, and 110.
Due to the effects of COVID-19, the Aircraft have been stored
since March 2020 and are currently at Dubai World Central
International Airport ("DWC").
Please note that the asset manager has not included the
utilisation table included in previous financial statements as the
aircraft were not in service during the period under review.
Maintenance Status
Emirates maintains its A380 aircraft fleet based on a
maintenance programme according to which minor maintenance checks
are performed every 1,500 flight hours, and more significant
maintenance checks (C checks) at 36-month or 18,000-flight hour
intervals, whichever occurs first.
Due to the continuing COVID-19 pandemic, Emirates has stored the
aircraft owned by the Group in Dubai. The lessee has "a
comprehensive aircraft parking and reactivation programme [in
place], that strictly follows manufacturer's guidelines and
maintenance manuals". In addition, Emirates has enhanced standards
and protocols of their own, to protect and preserve the asset
during the downtime. This includes the watertight sealing of all
apertures and openings through which environmental factors - sand,
water, birds, and insects - can find their way inside an aircraft.
During parking, maintenance teams complete periodic checks at
different intervals. Depending on the reactivation date of a
specific aircraft, the lessee might defer due maintenance checks,
which are calendar-based, until that time. This would allow the
lessee to make use of the full maintenance interval once the
operation of a specific aircraft resumes.
Emirates bears all costs relating to the aircraft during the
lifetime of the leases (including maintenance, repairs and
insurance).
Inspections
Doric, the asset manager, conducted physical inspections of the
aircraft with MSNs 077, 105, and 106, as well as records audits of
the aircraft with MSNs 105 and 106 in August 2020. The condition of
the aircraft and technical records where in compliance with the
provisions of the respective lease agreements.
2. Market Overview
The impact of COVID-19 on the global economy has been severe and
is expected to result in a 4.9% to 5.2% contraction in global GDP
for 2020, according to the International Monetary Fund and the
World Bank. In its latest economic impact analysis, the
International Civil Aviation Organization (ICAO) estimated that the
full year 2020 will see a reduction in seats offered by airlines of
48% to 51% compared with the previous baseline forecast for the
year. Furthermore, ICAO anticipates this trend to continue into the
first quarter of 2021 with airlines reducing seats offered by 23%
to 43%. However, the actual impact of COVID-19 on the airline
industry will depend on a number of factors, including the duration
and magnitude of the outbreak and containment measures, the degree
of consumer confidence in air travel as well as general economic
conditions. The International Air Transport Association ("IATA")
has forecast an airline industry-wide net loss of USD 84.3 billion
for this year.
As of September 2020, air passenger demand has continued its
gradual recovery from the low-point in April, with i ndustry-wide
revenue passenger kilometres (" RPKs ") contracting by 73%
year-on-year in September vs. an 75% fall in August. The load
factor of 60.1% was the lowest in history for September. Modest
demand improvements were primarily being driven by some domestic
markets including Russia and China, while there was no clear
recovery in international traffic in September. I n the first nine
months of 2020, RPKs were down 65 % against the previous year.
Similarly, i ndustry-wide capacity, measured in available seat
kilometres ("ASKs"), also decreased by 56% between January and
September 2020 against the same period in 2019 . This resulted in a
16.1 percentage point decrease in the worldwide passenger load
factor ("PLF") to 66.7%.
In the first nine months of 2020, passenger traffic in the
Middle East was down 69 % against the previous year . Capacity also
fell by 62%, resulting in a 13.7 percentage point decrease in PLF
to 63.0%. Latest available data for September indicate an RPK
contraction of 89% against the same month in the previous year,
with ASKs 77% below its September 2019 levels. The PLF amounts to
about 37%, a decline of 38.5 percentage points. IATA anticipates
the losses of Middle Eastern airlines to rise to USD 4.8 billion in
2020 (from a loss of USD 1. 5 billion in 2019 ).
Source: IATA, ICAO
(c) International Air Transport Association, 2020. Air Passenger
Market Analysis September 2020. Economic Performance of the Airline
Industry, Mid-Year Report June 2020 . All Rights Reserved.
Available on the IATA Economics page .
(c) International Civil Aviation Organization, Effects of Novel
Coronavirus (COVID-19) on Civil Aviation: Economic Impact Analysis,
9 September 2020.
3. Lessee - Emirates
Network
As of mid-August, over 150 destinations in Emirates' global
network remained subject to COVID-19-related travel restrictions.
Daily flights were around 230 - approximately 40% of pre-pandemic
levels, with half of the frequencies operating as cargo-only
services. As a means to contain the outflow of cash, Emirates has
adopted the policy that no operation is allowed to go below the
cash operating costs. According to Emirates' president Tim Clark,
the Airbus A380 has proven economically viable in this regard, as
solid load factors have led to profitable operations. The airline
resumed its A380 services on 15 July with flights to London
Heathrow and Paris.
In order to rebuild confidence in air travel, Emirates became
the first airline to offer free COVID-19 insurance for all
passengers on its own flights and those of its codeshare partners.
The programme covers medical expenses of up to EUR 150,000 and
quarantine costs of EUR 100 per day for 14 days, should passengers
be diagnosed with COVID-19 during their travel. The programme is
set to end on 31 December.
At the beginning of September, Emirates and flydubai announced
that they have renewed their partnership, allowing customers to
travel on codeshare flights to over 30 destinations on flydubai and
over 70 destinations on Emirates. Both airlines have implemented
safety measures, including enhanced sanitation of all touchpoints
and advanced High Efficiency Particulate Air ("HEPA") filters
fitted in aircraft cabins. Passengers on Emirates flights are also
provided with a complimentary hygiene kit containing masks, gloves,
hand sanitiser and anti-bacterial wipes.
Up until the end of September, Emirates' A380 fleet has resumed
flights to six destinations, including Cairo, Guangzhou, London
Heathrow, Moscow, Paris, and Toronto.
At the end of September, Emirates was operating passenger and
cargo flights to 104 cities.
Fleet
While Emirates' operations had remained mainly cargo-only
services through mid-August, the carrier has since announced plans
to gradually increase its passenger network and plans to service 99
destinations in November. Prior to this, the vast majority of
Emirates' 141 passenger Boeing 777 aircraft had returned to
service, but many had been operating cargo-only flights. In fact,
Emirates performed a partial retrofit on 14 Boeing 777-300ER
passenger aircraft to transport freight in the cabin. At the same
time, 13 of Emirates' 115 Airbus A380 aircraft have been returned
to service.
The table below details the passenger fleet activity as of 30
September 2020, reflecting Emirates' recently increased
operations:
Aircraft Type Grounded In Service
A380 102 13
--------- -----------
777 4 137
--------- -----------
Total 106 150
--------- -----------
% 41% 59%
--------- -----------
Source: Cirium as of 30 September 2020
In July, Boeing disclosed that the 777X programme was being
delayed again, with deliveries now scheduled to begin in 2022. In
response, Emirates, as the launch customer of the Boeing 777-9, is
seeking additional clarity on the certification process as it
negotiates a revised schedule for its Boeing 777-9 aircraft.
However, Tim Clark noted that the delivery delay probably benefits
Emirates in the short-term due to the ongoing global pandemic.
In November, Emirates announced that it had started to utilise
the A380 on select cargo charter operations as a dedicated
"Emirates A380 'mini-freighter'". As a first step it has optimised
the cargo capacity "to safely transport around 50 tonnes of cargo
per flight in the bellyhold of the aircraft". Emirates SkyCargo is
working on further optimisations of the capacity through measures
such as seat loading of cargo. Emirates SkyCargo has scheduled more
dedicated A380 cargo flights for the month of November in response
to the surge in demand for air cargo capacity, required for the
urgent transportation of critical goods, including medical supplies
for combatting COVID-19.
Key Financials
In the first half of the financial year ending 31 March 2021,
Emirates recorded its first half-year loss in over 30 years.
Revenues fell 75% to AED 13.7 billion (USD 3.7 billion) due to
pandemic-related travel restrictions, including an eight-week
suspension of scheduled passenger flights during April and May.
These measures resulted in a net loss of AED 12.6 billion (USD 3.4
billion) compared to a profit of AED 863 million (USD 235 million)
in the first half of the previous financial year.
Emirates reduced its ASKs by 91% in the first half of the
2020/21 financial year, while RPKS were down by 96%. During this
period, Emirates' average PLF fell to 38.6%, compared to last
year's pre-pandemic figure of 81.1%.
Emirates' operating costs decreased by 52%. Fuel, which had
previously been the largest cost category for the airline, only
accounted for 11% of total operating costs (compared to 32% in the
first half of the previous financial year). Contributing factors
were a 49% decrease in oil prices and a 76% lower fuel uplift from
reduced flight operations. Despite this significant reduction in
operations, Emirates' EBITDA remained positive at AED 290 million
(USD 79 million).
While the number of passengers Emirates carried between 1 April
and 30 September 2020 was down 95% to 1.5 million passengers
compared to the same period last year, airfreight demand rose
strongly. The volume of cargo uplifted decreased by 35% to 0.8
million tonnes during this period, but the yield more than doubled.
This development reflects the extraordinary market situation during
the global COVID-19 pandemic.
As a part of its cost-saving measures, Emirates Group reduced
its combined employee base of Emirates Airline and air services
provider Dnata by 24% during the first half of the current
financial year.
As of 30 September, Emirates' total liabilities decreased by
8.3% to AED 136.1 billion (USD 37.1 billion USD) compared to the
end of the previous financial year. Total equity decreased by 10.6%
to AED 21.1 billion (USD 5.75 billion) with an equity ratio of
13.4%. Emirates' cash position amounted to AED 15.6 billion (USD
4.25 billion) at the end of the first half of the 2020/21 financial
year. This compares to AED 20.2 billion (USD 5.5 billion) in cash
assets as of 31 March 2020.
On the ongoing financial position of Emirates in light of the
global COVID-19 pandemic, HH Sheikh Ahmed bin Saeed Al Maktoum,
chairman and chief executive of Emirates Airline, stated: "We have
been able to tap on our own strong cash reserves, and through our
shareholder and the broader financial community, we continue to
ensure we have access to sufficient funding to sustain the business
and see us through this challenging period. In the first half of
2020-21, our shareholder injected USD 2 billion into Emirates by
way of an equity investment and they will support us on our
recovery path."
As at the end of September Emirates has outstanding US dollar
debt issuances with maturities in 2023, 2025, and 2028. These
respective bonds were trading at approximately par (100 cents) each
and with running yields ranging from approximately 3.9% to 4.5% in
US dollars there has also been no upward pressure on yields. This
level of yields does not appear to indicate any significant
financial stress to the issuer.
In August 2020 rating agency Moody's Investor Service (Moody's)
downgraded its rating assigned to the Class A EETC issued by DNAFA
from Ba1 to Ba3 with a negative outlook. Moody's stated that the
rating action "reflect[s] the adverse impacts of the coronavirus on
the demand for and secondary market values of the Airbus A380
aircraft and Emirates' financial performance. The negative outlook
reflects the uncertainty of the coronavirus' lasting impact on
global demand for air travel and Emirates Airline's operations and
financial position." The press release stresses that "Moody's
believes the A380 will remain relevant to Emirates' fleet
strategy". Irrespective of the challenges the coronavirus means for
the airline and the Company, the rating agency continues to expect
timely payments of interest and scheduled principal on the
Certificates. For its rating considerations Moody's assumed a
part-out value for the A380 of about 50 million USD per aircraft.
The rating action resolves the review for downgrade of the issuance
initiated back in March.
Source: Cirium, Emirates
4. Aircraft - A380
As at the end of September 2020, the global A380 fleet consisted
of 237 planes with 14 airline operators. Only 19 of these aircraft
were in service, the remainder of the fleet is parked due to
COVID-19. The fourteen operators are Emirates (115), Singapore
Airlines (19), Deutsche Lufthansa (14), Qantas (12), British
Airways (12), Korean Air Lines (10), Etihad Airways (10), Qatar
Airways (10), Air France (9), Malaysia Airlines (6), Thai Airways
(6), Asiana Airlines (6), China Southern Airlines (5), All Nippon
Airways (2), and Hi Fly (1). Another three temporarily stored
aircraft are lease returns.
Due to the COVID-19 pandemic, most A380 operators temporarily
parked the aircraft type from March, with the number of parked
A380s peaking at nearly the entire fleet. In fact, only China
Southern and Hi Fly operated their A380s continuously. However,
Emirates began to gradually restore A380 services in mid-July. In
contrast, other A380 operators, such as Singapore Airlines, Qantas
and Qatar Airways, are reviewing their fleets and have indicated
that there will be no early return of A380 services. Air France
does not plan a return to service for any of its remaining
A380s.
Tim Clark expects the Airbus A380 to continue to play an
important role once the travel demand begins recovering from the
post-coronavirus crisis, provided a vaccine is available: "[It]
would be folly to exclude large wide-bodied aircraft in the future.
The A380 has proven to be a hugely successful aircraft and if fuel
prices were forever to stay at today's levels, this aircraft is
hugely potent." Clark also added that the first A380 aircraft
equipped with Emirates' new premium-economy cabin has finished
assembly in Toulouse, although he did not provide any further
update as to the status of the airline's last eight A380s, which
were scheduled to be delivered over the next year.
In spring 2020 Lufthansa disclosed that it intends to
permanently decommission six A380s with immediate effect. They were
originally earmarked to depart the fleet in 2022. In September the
airline announced that the remaining eight aircraft, "which were
previously intended for flight service, will be transferred to
storage and removed from planning". "These aircraft will only be
reactivated in the event of an unexpectedly rapid market recovery",
according to a press release. Lufthansa no longer expects to
achieve 50% of its pre-COVID-19 ASK levels by the end of 2021 and
released a new estimate of 20-30%. The German airline group stated
that the outlook for international air transport "has significantly
worsened" in recent weeks.
Paul Griffiths, the chief executive of Dubai Airports, which
owns and manages the operation and development of both Dubai's
airports, has expressed confidence in the concept of international
hubs in a post-COVID world, despite the trend towards more
point-to-point traffic. With many countries facing an economic
crisis Paul believes that "the efficiency of hubs and aggregation
power of bringing together city pairs around the world, which will
never likely have enough traffic to be justified to have a
point-to-point service, will continue to be served and aggregated
very efficiently through global hubs". Against this background he
assumes that "777 and A380 are pretty well placed for several years
to come as actually serving that role very well". Another
COVID-related development could also help large airport hubs: He
thinks that "it's going to be very difficult to persuade the
environmental groups and general public actually to support airport
expansions in the future". Due to COVID-19 lockdowns and the
associated slowdown in industrial production, pollution was
temporarily avoided in many regions around the world, resulting in
clear skies.
Source: Cirium, Simple Flying
D I R E C T O RS
As at 30 September 2020 the Company had four directors all of
whom were independent and non-executive.
Geoffrey Alan Hall - Chair of the Company and of the Nomination
Committee
Geoffrey Hall has extensive experience in asset management,
having previously been Chief Investment Officer of Allianz
Insurance plc, a major UK general insurance company and an
investment manager at HSBC Asset Management, County Investment
Management, and British Railways Pension Funds. Geoffrey is also a
director and Chair of the Audit Committee of Doric Nimrod Air One
Limited and of Doric Nimrod Air Three Limited.
Geoffrey earned his master's degree in Geography at the
University of London and is an associate of the CFA Society of the
UK. He is resident in the United Kingdom.
Charles Edmund Wilkinson
Charles Wilkinson is a solicitor who retired from Lawrence
Graham LLP in March 2005. While at Lawrence Graham he specialised
in corporate finance and commercial law, latterly concentrating on
investment trust and fund work.
Charles is Chair of Doric Nimrod Air One Limited and of Doric
Nimrod Air Three Limited and is a director of Landore Resources
Ltd, a Guernsey based mining exploration company. He is resident in
Guernsey.
Suzanne Elaine Procter - Senior Independent Director ("SID")
Suzanne Procter brings over 38 years' experience in financial
markets, with specific expertise in asset management. She was
previously a non-executive director of TR Property Investment Trust
plc, an investment company listed on the FTSE 250 index. Her
executive roles included Partner and member of the Executive
Management Committee at Cantillon Capital Management LLC, Managing
Director of Lazard Asset Management, Head of Institutional Sales at
INVESCO Asset Management, Director and Head of Fixed Income
Business at Pictet International Management Ltd and Head of Fixed
Income at Midland Montagu Asset Management.
Suzanne is also the SID of Doric Nimrod Air One Limited and
Doric Nimrod Air Three Limited. She is resident in the United
Kingdom.
Andreas Josef Tautscher - Chair of the Audit Committee
Andreas Tautscher brings over 31 years' financial services
experience. He serves as a non-executive director and member of the
Audit Committee of BH Global Limited, a Guernsey closed-ended
investment company whose shares are traded on the Main Market of
the London Stock Exchange, and as a non-executive director of MJ
Hudson Group plc, a Jersey company whose shares are traded on the
AIM Market of the London Stock Exchange.. He is also a director and
CEO of Altair Group, a leading independent director services
business in the Channel Islands. From 1994 to 2018 Andreas held
various roles at Deutsche Bank and was most recently CEO of the
Channel Islands and Head of Financial Intermediaries for EMEA. He
was previously a non-executive director of the Virgin Group.
Andreas qualified as a Chartered Accountant in 1994.
Andreas is also a director of Doric Nimrod Air One Limited and
Doric Nimrod Air Three Limited. He is resident in Guernsey.
I N T ER IM M A N A GEMENT REPORT
A description of important events which have occurred during the
period from 1 April 2020 until 30 September 2020 (the "Period"),
their impact on the performance of the Group as shown in the
Consolidated Financial Statements and a description of the
principal risks and uncertainties facing the Group is given in the
Chair's Statement, Asset Manager's Report, and the Notes to the
Consolidated Financial Statements contained on pages 20 to 45 and
are incorporated here by reference.
There were no material related party transactions which took
place in the Period, other than those disclosed at note 22 of the
Notes to the Consolidated Financial Statements.
Principal Risks and Uncertainties
The principal risks and uncertainties faced by the Company for
the remaining six months of the financial year are unchanged from
those disclosed in the Company's Annual Financial Report for the
year ended 31 March 2020.
G o i n g Concern
The Group's principal activities are set out within the Company
Overview on pages 2 to 4. The financial position of the Group is
set out on page 17. In addition, note 19 of the Notes to the
Consolidated Financial Statements includes the Group's objectives,
policies and processes for managing its capital; its financial risk
management objectives and its exposures to credit risk and
liquidity risk.
The Directors in consultation with the Asset Manager are closely
monitoring the effect of the COVID-19 pandemic generally on the
aviation industry and specifically on the Group's aircraft values
and the financial wellbeing of its lessee both now and in the
future. The impact of the COVID-19 pandemic on the aviation sector
has been significant with about a third of the global passenger
aircraft fleet still grounded. The Group's future performance could
potentially be impacted should this pandemic have a pervasive and
prolonged impact on the economy. There have prevailed wide spread
restrictions on the ability of people to travel which has had a
material negative effect on the airline sector, and by extension
the aircraft leasing sector. This may lead to the inability of
airlines to pay rent as it falls due. These factors, together with
wider economic uncertainty and disruption, are likely to have an
adverse impact on the future value of the aircraft Assets owned by
the Group, as well as on the sale, re-lease, refinancing or other
disposition of the relevant aircraft.
The Directors consider that the going concern basis of
accounting remains appropriate. Based on current information the
Directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable
future, although the risk to this is clearly higher.
The Board will continue to actively monitor the financial impact
on the Group resultant from the evolving position with its aircraft
lessee and lenders whilst bearing in mind its fiduciary obligations
and the requirements of Guernsey law which determine the ability of
the Group to make dividends and other distributions.
The Directors, with the support of its Asset Manager, believe
that it is reasonable to assume as of date of approval of the half
yearly financial statements that Emirates will continue with the
contracted lease rental payments due to the following:
- Dubai's government has injected US$2 billion into Emirates so
far since the COVID-19 pandemic brought global air travel to a near
halt in March and is prepared to send more help to its flagship
airline.
- Emirates' listed debt and Credit Default Swaps (CDS's) are trading at non-distressed levels.
- The airline resumed its A380 services on 15 July 2020 with
flights to a limited number of destinations.
- As at 4 December 2020, the Asset Manager was not aware of a
formal request addressed to the Group for a lease deferral or any
other efforts that would result in the restructuring of the
existing transactions and which could potentially have an impact on
the committed future lease rental receipts.
- Emirates has paid all lease rentals in a timely manner.
Whilst there is some uncertainty as to the airline industry in
general, and specifically Emirates' financial position and credit
risk profile, on the basis that (i) Emirates has shown no intention
of failing to meet its obligations to the Group (ii) Emirates is
presumed to have the financial backing to continue paying these
rentals, the Directors believe that it is appropriate to prepare
these half yearly financial statements under the going concern
basis of preparation.
. Respons i b i l i ty Stateme nt
T h e D irect ors j oin t ly and se v eral ly co n f irm t h at
to t he best of t he ir k no w ledge:
a) the Consolidated Financial Statements, prepared in accordance
with International Financial Reporting Standards ("IFRS") give a
fair, balanced and understandable view of the assets, liabilities,
financial position and profits of the Company and performance of
the Company; and
b) this Interim Management Report includes or incorporates by reference:
i. an indication of important events that have occurred during
the Period and their impact on the Consolidated Financial
Statements;
ii. a description of the principal risks and uncertainties for
the remaining six months of the financial year; and
iii. confirmation that there were no related party transactions
in the Period that have materially affected the financial position
or the performance of the Company during that Period.
Si g ne d on beha lf of t he Board of Dire c t ors of t he
Company .
Geoffrey Hall Andreas Tautscher
Chair Director
10 December 2020
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the period from 1 April 2020 to 30 September 2020
1 Apr 2020 1 Apr 2019
to to
Notes 30 Sep 2020 30 Sep 2019
GBP GBP
INCOME
A rent income 4 48,472,895 48,082,215
B rent income 4 18,217,070 18,266,980
Bank interest received 8,542 60,870
66,698,507 66,410,065
EXPENSES
Operating expenses 5 (1,842,021) (1,744,363)
Depreciation of Aircraft 10 (38,196,096) (23,140,129)
------------- -------------
(40,038,117) (24,884,492)
Net profit for the period before
finance costs and foreign exchange
gains/(losses) 26,660,390 41,525,573
Finance costs 11 (6,092,448) (8,574,113)
Net profit for the period after
finance costs and before foreign
exchange gains/(losses) 20,567,942 32,951,460
Unrealised foreign exchange gains/(losses) 7 12,728,837 (24,255,465)
------------- -------------
Profit for the period 33,296,779 8,695,995
Other Comprehensive Income - -
------------- -------------
Total Comprehensive Income for
the period 33,296,779 8,695,995
------------- -------------
Pence Pence
Earnings per Share for the period
- Basic and Diluted 9 19.27 5.03
In arriving at the results for the financial period, all amounts
above relate to continuing operations.
The notes on pages 20 to 45 form an integral part of these
consolidated financial statements.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 September 2020
30 Sep 2020 31 Mar 2020
Notes GBP GBP
NON-CURRENT ASSETS
Aircraft 10 558,764,045 596,960,140
558,764,045 596,960,140
CURRENT ASSETS
Accrued income 5,325,582 4,940,074
Receivables 13 250,707 53,262
Cash and cash equivalents 17 29,940,565 30,016,771
35,516,854 35,010,107
TOTAL ASSETS 594,280,899 631,970,247
------------- -------------
CURRENT LIABILITIES
Borrowings 15 84,473,794 85,703,367
Deferred income 7,840,789 7,840,789
Payables - due within one year 14 62,804 72,928
------------- -------------
92,377,387 93,617,084
NON-CURRENT LIABILITIES
Borrowings 15 109,835,934 158,380,240
Deferred income 145,798,795 151,414,304
Financial liabilities at fair
value through profit or loss 216,815 255,930
------------- -------------
255,851,544 310,050,474
TOTAL LIABILITIES 348,228,931 403,667,558
------------- -------------
TOTAL NET ASSETS 246,051,968 228,302,689
------------- -------------
EQUITY
Share capital 16 319,836,770 319,836,770
Retained earnings (73,784,802) (91,534,081)
------------- -------------
246,051,968 228,302,689
------------- -------------
Pence Pence
Net Asset Value per Share based
on 172,750,000 (31 Mar 2020:
172,750,000) shares in issue 142.43 132.16
The consolidated financial statements were approved by the Board
of Directors and authorised for issue on 10 December 2020 and are
signed on its behalf by:
Geoffrey Hall Andreas Tautscher
Chair Director
The notes on pages 20 to 45 form an integral part of these
consolidated financial statements.
CONSOLIDATED STATEMENT OF CASH FLOWS
For the period from 1 April 2020 to 30 September 2020
1 Apr 2020 1 Apr 2019
to to
30 Sep 2020 30 Sep 2019
Notes GBP GBP
OPERATING ACTIVITIES
Profit for the period 33,296,779 8,695,995
Movement in accrued and deferred income (543,549) 1,233,326
Interest received (8,542) (60,870)
Accrued interest - 7,771
Depreciation of Aircraft 10 38,196,096 23,140,129
Loan interest payable 11 5,620,392 7,834,843
Movement in interest rate swap 11 (39,115) 228,099
Decrease in payables (10,124) (7,326)
Increase in receivables (197,445) (11,298)
Foreign exchange movement 7 (12,728,837) 24,255,465
Amortisation of debt arrangement costs 11 511,171 511,171
------------- -------------
NET CASH FROM OPERATING ACTIVITIES 64,096,826 65,827,305
------------- -------------
INVESTING ACTIVITIES
Interest received 8,542 60,870
NET CASH FROM INVESTING ACTIVITIES 8,542 60,870
------------- -------------
FINANCING ACTIVITIES
Dividends paid 8 (15,547,500) (15,547,500)
Repayments of capital on borrowings 20 (42,520,674) (41,920,233)
Repayments of interest on borrowings 20 (5,777,560) (7,658,692)
------------- -------------
NET CASH USED IN FINANCING ACTIVITIES (63,845,734) (65,126,425)
------------- -------------
CASH AND CASH EQUIVALENTS AT BEGINNING
OF PERIOD 30,016,771 28,236,268
Increase in cash and cash equivalents 259,634 761,750
Effects of foreign exchange rates 7 (335,840) 488,187
CASH AND CASH EQUIVALENTS AT OF
PERIOD 17 29,940,565 29,486,205
------------- -------------
The notes on pages 20 to 45 form an integral part of these
consolidated financial statements.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the period from 1 April 2020 to 30 September 2020
Notes Share Retained
Capital Earnings Total
GBP GBP GBP
Balance as at 1 April
2020 319,836,770 (91,534,081) 228,302,689
Total Comprehensive
Income for the period - 33,296,779 33,296,779
Dividends paid 8 - (15,547,500) (15,547,500)
---------------- ------------- -------------
Balance as at 30 September
2020 319,836,770 (73,784,802) 246,051,968
---------------- ------------- -------------
Share Retained
Capital Earnings Total
GBP GBP GBP
Balance as at 1 April
2019 319,836,770 7,153,972 326,990,742
Total Comprehensive
Income for the period - 8,695,995 8,695,995
Dividends paid 8 - (15,547,500) (15,547,500)
---------------- ------------- -------------
Balance as at 30 September
2019 319,836,770 302,467 320,139,237
---------------- ------------- -------------
The notes on pages 20 to 45 form an integral part of these
Consolidated Financial Statements.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the period from 1 April 2020 to 30 September 2020
1. GENERAL INFORMATION
The consolidated financial statements incorporate the results of
Doric Nimrod Air Two Limited (the "Company"), MSN077 Limited, MSN090
Limited, MSN105 Limited and Doric Nimrod Air Finance Alpha Limited
(together "Subsidiaries") (together the Company and the Subsidiaries
are known as the "Group").
The Company was incorporated in Guernsey on 31 January 2011 with
registered number 52985. The address of the registered office is
given on page 46. Its share capital consists of one class of ordinary
preference shares ("Shares") and one class of subordinated administrative
shares ("Administrative Shares"). The Company's Shares have been
admitted to trading on the Specialist Fund Segment (the "SFS")
of the London Stock Exchange's Main Market (the "LSE").
The Company's investment objective is to obtain income returns
and a capital return for its Shareholders by acquiring, leasing
and then selling aircraft (each an "Asset" or "Aircraft" and together
the "Assets" or "Aircraft") . The principal activities of the Group
are set out in the Chair's Statement and Interim Management Report
on pages 5 to 6 and pages 14 to 16 respectively.
2. ACCOUNTING POLICIES
The significant accounting policies adopted by the Group are as
follows:
(a) Basis of Preparation
The consolidated financial statements have been prepared in conformity
with the International Accounting Standard 34 Interim Financial
Reporting as adopted by the European Union ("EU"), and applicable
Guernsey law. The financial statements have been prepared on a
historical cost basis.
This report is to be read in conjunction with the annual financial
report for the year ended 31 March 2020 which is prepared in accordance
with the International Financial Reporting Standards ("IFRS") as
adopted by the EU and any public announcements made by the Group
during the interim reporting period from 1 April 2020 to 30 September
2020 (the "Period").
The accounting policies adopted are consistent with those of the
previous financial year and corresponding interim reporting period,
except for the adoption of new and amended standards as set out
below:
(b) Adoption of new and revised Standards
New and amended IFRS Standards that are effective for the current
period
T h e f ollowing Standard and Interpretation issued by the International
Accounting Standards B oard (" IA SB ") and International Financial
Re porting Standards Interpretations Committ ee (" IFRIC ") ha
s been adopted in the current perio d. T he adoption has not had
any im pact on the amounts reported in these fin ancial st atements
and is not e x pect ed to ha ve any impact on f uture fin ancial
perio ds:
* IAS 1'Presentation of financial statements' and IAS 8
'Accounting policies, changes in accounting estimates
and error' on definition of material - These
amendments to IAS 1, IAS 8 and consequential
amendments to other IFRSs: use a consistent
definition of materiality throughout IFRSs and the
Conceptual Framework for Financial Reporting; clarify
the explanation of the definition of material; and
incorporate some of the guidance in IAS 1 about
immateriality information. The effective date is for
annual periods beginning on or after 1 January 2020.
The standard has not had a material impact on the
financial statements or performance of the Group.
New and Revised Standards in issue but not yet effective
IFRS 16 'Leases' - Covid-19 related rent concessions. As a result
of the coronavirus (COVID-19) pandemic, rent concessions have
been granted to lessees. Such concessions might take a variety
of forms, including payment holidays and deferral of lease payments.
Lessees can elect to account for such rent concessions in the
same way as they would if they were not lease modifications. In
many cases, this will result in accounting for the concession
as variable lease payments in the period(s) in which the event
or condition that triggers the reduced payment occurs. The standard
is not expected to have a material impact on the financial statements
or performance of the Group as it is applicable to lessees. The
effective date is for annual periods beginning on or after June
2020. The standard is not expected to have a material impact on
the financial statements or performance of the Group and is not
endorsed by the EU.
IAS 1 'Presentation of financial statements' Classification of
Liabilities as Current or Non-current. The IASB issued amendments
to paragraphs 69 to 76 of IAS 1 to specify the requirements for
classifying liabilities as current or non-current. The effective
date is for annual periods beginning on or after 1 January 2023.
The standard is not expected to have a material impact on the
financial statements or performance of the Group and is not endorsed
by the EU.
c) Basis of Consolidation
The consolidated financial statements incorporate the results of
the Company and its Subsidiaries.
The Company owns 100 per cent. of all the shares in the Subsidiaries,
and has the power to govern the financial and operating policies
of the Subsidiaries so as to obtain benefits from their activities.
Intra-group balances and transactions, and any unrealised income
and expenses arising from intra-group transactions, are eliminated
in preparing the consolidated financial statements.
d) Taxation
The Company and its Subsidiaries have been assessed for tax at
the Guernsey standard rate of 0 per cent.
e) Share Capital
Shares are classified as equity. Incremental costs directly attributable
to the issue of Shares are recognised as a deduction from equity.
f) Expenses
All expenses are accounted for on an accruals basis.
g) Interest Income
Interest income is accounted for on an accruals basis.
h) Foreign Currency Translation
The currency of the primary economic environment in which the Group
operates (the functional currency) is Pound Sterling ("GBP", "GBP"
or "Sterling") which is also the presentation currency.
Transactions denominated in foreign currencies are translated into
Sterling at the rate of exchange ruling at the date of the transaction.
Monetary assets and liabilities denominated in foreign currencies
at the reporting date are translated into the functional currency
at the foreign exchange rate ruling at that date. Foreign exchange
differences arising on translation are recognised in the Consolidated
Statement of Comprehensive Income.
i) Cash and Cash Equivalents
Cash at bank and short term deposits which are held to maturity are
carried at cost. Cash and cash equivalents are defined as call deposits,
short term deposits with a term of no more than three months from
the start of the deposit and highly liquid investments readily convertible
to known amounts of cash and subject to insignificant risk of changes
in value.
(j) Segmental Reporting
The Directors are of the opinion that the Group is engaged in a single
segment of business, being acquiring, leasing and selling various
Airbus A380-861 aircraft.
(k) Going Concern
The Directors have prepared these half yearly financial statements
for the period ended 30 September 2020 on the going concern basis.
The Directors in consultation with the Asset Manager are closely
monitoring the effect of the COVID-19 pandemic generally on the aviation
industry and specifically on the Group's aircraft values and the
financial wellbeing of its lessee both now and in the future. The
impact of the COVID-19 pandemic on the aviation sector has been significant
with about a third of the global passenger aircraft fleet still grounded.
The Group's future performance could potentially be impacted should
this pandemic have a pervasive and prolonged impact on the economy.
There have prevailed widespread restrictions on the ability of people
to travel which has had a material negative effect on the airline
sector, and by extension the aircraft leasing sector. This may lead
to the inability of airlines to pay rent as it falls due. These factors,
together with wider economic uncertainty and disruption, are likely
to have an adverse impact on the future value of the aircraft assets
owned by the Group, as well as on the sale, re-lease, refinancing
or other disposition of the relevant aircraft.
The Directors consider that the going concern basis of accounting
remains appropriate. Based on current information the Directors have
a reasonable expectation that the Company has adequate resources
to continue in operational existence for the foreseeable future,
although the risk to this is clearly higher.
The Board will continue to actively monitor the financial impact
on the Company and its Group resultant from the evolving position
with its aircraft lessee and lenders whilst bearing in mind its fiduciary
obligations and the requirements of Guernsey law which determine
the ability of the Company to pay dividends and make other distributions.
Note 15 ('Borrowings') describes the borrowings obtained by the Group
to part-finance the acquisition of its aircraft. The Group has obligations
under the loans to make scheduled repayments of principal and interest,
which are serviced by the receipt of lease payments from Emirates.
The loans have been largely fixed and the fixed rental income under
the operating leases means that the rents should be sufficient to
repay the debt and provide surplus income to pay for the Group's
expenses and permit payment of dividends.
The Group's aircraft with carrying values of GBP558,764,045 are pledged
as security for the Group's borrowings (see note 15).
The Group is currently in a net asset position and generates strong
positive operating cash flows.
The Directors, with the support of its Asset Managers, believe that
it is reasonable to assume as of date of approval of the half yearly
financial statements that Emirates will continue with the contracted
lease rental payments due to the following:
* Dubai's government has injected US$2 billion into
Emirates so far since the COVID-19 pandemic brought
global air travel to a near halt in March and is
prepared to send more help to its flagship airline.
* Emirates' listed debt and Credit Default Swaps
("CDS's") are trading at non-distressed levels.
* The airline resumed its A380 services on 15 July 2020
with flights to a limited number of destinations.
* As at 4 December 2020, the Asset Manager was not
aware of a formal request addressed to the Group for
a lease deferral or any other efforts that would
result in the restructuring of the existing
transactions and which could potentially have an
impact on the committed future lease rental receipts.
* Emirates has paid all lease rentals in a timely
manner.
Whilst there is some uncertainty as to the airline industry in general,
and specifically Emirates' financial position and credit risk profile,
on the basis that (i) Emirates has shown no intention of failing
to meet its obligations to the Group (ii) Emirates is presumed to
have the financial backing to continue paying these rentals, the
Directors believe that it is appropriate to prepare these half yearly
financial statements under the going concern basis of preparation.
(l) Leasing and Rental Income
The leases relating to the Assets have been classified as operating
leases as the terms of the leases do not transfer substantially all
the risks and rewards of ownership to the lessee. The Assets are
shown as non-current assets in the Consolidated Statement of Financial
Position. Further details of the leases are given in note 12.
Rental income and advance lease payments from operating leases are
recognised on a straight-line basis over the term of the relevant
lease. Initial direct costs incurred in negotiating and arranging
an operating lease are added to the carrying amount of the leased
asset and amortised on a straight-line basis over the lease term.
(m) Property, Plant and Equipment - Aircraft
In line with IAS 16 Property Plant and Equipment, each Asset is initially
recorded at the fair value of the consideration paid. The cost of
the Asset is made up of the purchase price of the Asset plus any
costs directly attributable to bringing it into working condition
for its intended use. Costs incurred by the lessee in maintaining,
repairing or enhancing the Aircraft are not recognised as they do
not form part of the cost to the Group. Accumulated depreciation
and any recognised impairment losses are deducted from cost to calculate
the carrying amount of the Asset.
Depreciation is recognised so as to write off the cost of the each
Asset less the estimated residual value over the estimated useful
life of the Asset of 12 years, using the straight line method.
The estimated residual value of the seven planes ranges from GBP37.7
million to GBP40.1 million (2019: GBP72.3 million to GBP75.5 million).
Residual values have been arrived at by taking the average amount
of three independent external valuers and after taking into account
disposition fees where applicable. During the annual financial
report for the year ended 31 March 2020, it was determined that
the use of soft values excluding inflation best approximates residual
value as required by IAS 16 Property, Plant and Equipment.
Due to the A380-specific developments during the last financial
year of the Group and the generally dimmed market sentiment in
the aviation sector since the COVID-19 outbreak, which is not over
yet, there is an increasing risk that the underlying assumptions
of the Base Value concept might not be met at the time of the leases
expire. For this reason the Asset Manager recommended the use of
a more conservative approach in deploying future Soft Values instead
of Base Values. Soft Values are more conservative, also applicable
under "abnormal conditions" and do not necessarily require a balanced
market as the Base Value concept does.
This has resulted in a significant reduction in the residual value
of the Aircraft since 31 March 2019 when residual values were based
on Base Values.
The depreciation method reflects the pattern of benefit consumption.
The residual value is reviewed annually and is an estimate of the
fair amount the entity would receive today if the Assets were already
of the age and condition expected at the end of their useful life.
Useful life is also reviewed annually and for the purposes of the
financial statements represents the likely period of the Group's
ownership of these Assets. Depreciation starts when the Asset is
available for use.
At each audited Consolidated Statement of Financial Position date,
the Group reviews the carrying amounts of its Aircraft to determine
whether there is any indication that those Assets have suffered
an impairment loss. If any such indication exists, the recoverable
amount of the Asset is estimated to determine the extent of the
impairment loss (if any). Further details are given in note 3.
Recoverable amount is the higher of fair value less costs to sell
and the value in use. In assessing value in use, the estimated
future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments
of the time value of money and the risks specific to the Asset
for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an Asset is estimated to be less than
its carrying amount, the carrying amount of the Asset is reduced
to its recoverable amount. An impairment loss is recognised immediately
in profit or loss.
(n) Financial instruments
A financial instrument is recognised when the Group becomes a party
to the contractual provisions of the instrument. Financial liabilities
are derecognised if the Group's obligations, specified in the contract,
expire or are discharged or cancelled. Financial assets are derecognised
if the Group's contractual rights to the cash flows from the financial
assets expire, are extinguished, or if the Group transfers the
financial assets to a third party and transfers all the risks and
rewards of ownership of the Asset, or if the Group does not retain
control of the Asset and transfers substantially all the risk and
rewards of ownership of the Asset.
Under IFRS 9, on initial recognition, a financial asset is classified
as measured at:
* Amortised cost;
* Fair value through other comprehensive income
("FVOCI"); or
* Fair value through profit or loss ("FVTPL").
-
The classification of financial assets under IFRS 9 is generally
based on the business model in which a financial asset is managed
and its contractual cash flow characteristics. The Group only has
financial assets that are classified as amortised cost.
i) Financial assets held at amortised cost
A financial asset is measured at amortised cost if it meets both
of the following conditions and is not designated as at FVTPL:
* it is held within a business model whose objective is
to hold assets to collect contractual cash flows; and
* its contractual terms give rise on specified dates to
cash flows that are solely payments of principal and
interest on the principal amount outstanding.
Assets that are held for collection of contractual cash flows where
those cash flows represent solely payments of principal and interest
are measured at amortised cost. These assets are subsequently measured
at amortised cost using the effective interest method. The effective
interest method calculates the amortised cost of financial instruments
and allocates the interest over the period of the instrument.
The Group's financial assets held at amortised cost include trade
and other receivables and cash and cash equivalents.
The Group assesses on a forward looking basis the expected credit
losses associated with its financial assets held at amortised cost.
The impairment methodology applied depends on whether there has
been a significant increase in credit risk.
ii) Financial liabilities held at amortised cost
Financial liabilities consist of payables and borrowings. The classification
of financial liabilities at initial recognition depends on the
purpose for which the financial liability was issued and its characteristics.
All financial liabilities are initially measured at fair value,
net of transaction costs. All financial liabilities are recorded
on the date on which the Group becomes party to the contractual
requirements of the financial liability. Financial liabilities
are subsequently measured at amortised cost using the effective
interest method, with interest expense recognised on an effective
yield basis.
The effective interest method is a method of calculating the amortised
cost of the financial liability and of allocating interest expense
over the relevant period. The effective interest rate is the rate
that exactly discounts estimated future cash payments through the
expected life of the financial liability, or, where appropriate,
a shorter period, to the net carrying amount on initial recognition.
The Group derecognises financial liabilities when, and only when,
the Group's obligations are discharged, cancelled or they expire.
iii) Financial Assets and Financial Liabilities at fair value through
profit or loss
(a) Classification
The Group classifies its derivative i.e. the interest rate swap,
as financial assets or financial liabilities at fair value through
profit or loss. These financial assets and financial liabilities
are designated by the Board of Directors at fair value through
profit or loss. The Group does not classify any derivatives as
hedges for accounting purposes.
(b) Recognition/derecognition
Financial assets or liabilities are recognised on the trade date
- the date on which the Group commits to enter into the transactions.
Financial assets or liabilities are derecognised when the rights
to receive cash flows from the investments have expired or the
Group has transferred substantially all risks and rewards of ownership.
(c) Measurement
Financial assets and financial liabilities at fair value through
profit or loss are initially recognised at fair value. Transaction
costs are expensed in the Statement of Comprehensive Income. Subsequent
to initial recognition, all financial assets and financial liabilities
at fair value through profit or loss are measured at fair value.
Gains and losses arising from changes in the fair value of the
'financial assets or financial liabilities at fair value through
profit or loss' category are presented in the Statement of Comprehensive
Income in the year in which they arise.
3. SIGNIFICANT JUDGEMENTS AND ESTIMATES
In the application of the Group's accounting policies, which are
described in note 2, the Directors are required to make judgements,
estimates and assumptions about the carrying amounts of assets
and liabilities that are not readily apparent from other sources.
The estimates and associated assumptions are based on historical
experience and other factors that are considered to be relevant.
Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing
basis. Revisions to accounting estimates are recognised in the
period in which the estimate is revised if the revision affects
only that period or in the period of the revision and future periods
if the revision affects both current and future periods.
The following are the critical judgements and estimates that the
Directors have made in the process of applying the Group's accounting
policies and that have the most significant effect on the amounts
recognised in the consolidated financial statements.
Estimates
Residual Value and Useful Life of Aircraft
As described in note 2 (m), the Group depreciates the Assets on
a straight line basis over the estimated useful life of the Assets
after taking into consideration the estimated residual value.
IAS 16 Property, Plant and Equipment requires residual value to
be determined as an estimate of the amount that the Group would
currently obtain from disposal of the Asset, after deducting the
estimated costs of disposal, if the Asset were of the age and condition
expected at the end of its useful life. However, there are currently
no aircraft of a similar type of sufficient age for the Directors
to make a direct market comparison in making this estimation. During
the annual financial report for the year ended 31 March 2020, it
was determined that the use of soft values excluding inflation
best approximates residual value as required by IAS 16 Property,
Plant and Equipment.
Due to the A380-specific developments during the last financial
year of the Group and the generally dimmed market sentiment in
the aviation sector since the COVID-19 outbreak, which is not over
yet, there is an increasing risk that the underlying assumptions
of the Base Value concept might not be met at the time of the leases
expiry. For this reason the Asset Manager recommended to make use
of a more conservative approach in deploying future Soft Values
instead of Base Values.
Soft Values are more conservative, also applicable under "abnormal
conditions" and do not necessarily require a balanced market as
the Base Value concept does. There is additional uncertainty caused
by COVID-19 (the Directors have described their response to this
uncertainty in note 2 (k)) and refer to going concern on pages
22 to 23) which has resulted in the use of Soft Values in determining
the residual value of the Asset. This was reflected as a change
in the estimation basis in the annual financial report.
In estimating residual value for the year, the Directors referred
to future soft values (excluding inflationary effects) for the
Asset obtained from three independent expert aircraft valuers.
This has resulted in a significant reduction in the residual value
of the Aircraft since 31 March 2019 when residual values were based
on Base Values; details of which have been disclosed in note 10.
The estimation of residual value remains subject to inherent uncertainty.
If the estimate of residual value used in the calculation of depreciation
had decreased by 20 per cent. with effect from the beginning of
this Period, the net profit for the Period and closing shareholders'
equity would have decreased by approximately GBP6.4 million (30
September 2019: GBP8.3 million). An increase in residual value
by 20 per cent. would have had an equal but opposite effect. This
reflects the range of estimates of residual value that the Directors
believe would be reasonable at this time. The useful life of each
Asset, for the purpose of depreciation of the asset under IAS 16,
is estimated based on the expected period for which the Group will
own and lease the Aircraft.
Judgements
Operating Lease Commitments - Group as Lessor
The Group has entered into operating leases on seven (31 Mar 2020:
seven) Assets. The Group has determined, based on an evaluation
of the terms and conditions of the arrangements, that it retains
all the significant risks and rewards of ownership of these assets
and accounts for the contracts as operating leases.
The Group has determined that the operating leases on the Assets
are for 12 years based on an initial term of 10 years followed
by an exercised extension term of 2 years.
Functional Currency
The currency of the primary economic environment in which the Group
operates (the functional currency) is GBP, which is also the presentation
currency.
This judgement is made on the basis that this is representative
of the operations of the Group due to the following:
* the Company's share capital was issued in GBP;
* its dividends are paid to Shareholders in GBP, and
that certain of the Group's significant operating
expenses as well as portion of the Groups' rental
income are incurred/earned in GBP.
In addition, the set-up of the leasing structures was designed
to offer a GBP return to GBP investors .
Impairment
As described in note 2 (m), an impairment loss exists when the
carrying value of an asset or cash generating unit exceeds its
recoverable amount, which is the higher of its current fair value
less costs to sell and its value-in-use.
The Directors review the carrying amount of its Assets at each
audited Statement of Financial Position date and monitor the Assets
for any indications of impairment as required by IAS 16 Property,
Plant and Equipment and IAS 36 Impairment of Assets.
The Board together with the Asset Manager believed that it was
prudent to conduct an impairment test as at the 31 March 2020 year
end as the below items may result in pricing changes for the current
portfolio of Aircraft:
* As further Airbus A380 aircraft reached the expiry of
their first lease agreements further market data will
be available to Doric and the appraiser community.
* The announcement to discontinue the A380 program in
2021 may impact prices in the secondary market.
* The impact of COVID-19 on the business of airlines
and indirectly aircraft values, as well as on the
credit risk profile of the Company's lessee could
indicate the need for impairment.
Based on the impairment review performed, an impairment loss of
GBP68,465,211 was recognised in the 31 March 2020 year, with the
impairment test resulting in an updated carrying value of the Aircraft
in total to GBP 596,960,140 at year end, as reflected in Note 10
.
For the current period 1 April 2020 to 30 September 2020, the Board
has considered if there are any further impairment triggers as
set out under IAS 36 Impairment of Assets and concluded that an
interim impairment review at the 30 September 2020 period end was
not practicable. The Group will again be carrying out a full and
thorough appraisal of residual values come the next March financial
year end.
4. RENTAL INCOME
1 Apr 2020 1 Apr 2019
to to
30 Sep 2020 30 Sep 2019
GBP GBP
A rent income 48,314,854 49,750,958
Revenue received but not yet earned (16,224,758) (18,738,083)
Revenue earned but not yet received 12,462,404 13,138,205
Amortisation of advance rental income 3,920,395 3,931,135
------------- -------------
48,472,895 48,082,215
------------- -------------
B rent income 17,831,562 17,831,562
Revenue earned but not yet received 392,295 438,821
Revenue received but not yet earned (6,787) (3,403)
------------- -------------
18,217,070 18,266,980
-------------
Total rental income 66,689,965 66,349,195
------------- -------------
Rental income is derived from the leasing of the Assets. Rent is
split into A rent, which is received in US dollars ("$") and B
rent, which is received in Sterling. Rental income received in
US dollars is translated into the functional currency (Sterling)
at the date of the transaction.
An adjustment has been made to spread the actual total income receivable
over the term of the lease on an annual basis. In addition, advance
rentals received have also been spread over the full term of the
leases.
5. OPERATING EXPENSES
1 Apr 2020 1 Apr 2019
to to
30 Sep 2020 30 Sep 2019
GBP GBP
Corporate shareholder and advisor fee (note
22) 432,378 422,864
Asset Management fee (note 22) 1,045,477 1,022,472
Liaison agency fees (note 22) 5,925 5,794
Administration fees 87,843 94,510
Bank interest and charges 809 811
Accountancy fees 16,599 16,257
Registrars fee (note 22) 10,853 7,839
Audit fee 23,410 23,425
Directors' remuneration (note 6) 106,000 93,217
Directors' and officers' insurance 68,963* 15,904
Legal and professional expenses 24,647 31,854
Annual fees 3,750 1,186
Travel costs - 1,615
Marketing fees (note 22) 11,305 -
Other operating expenses 4,062 6,615
------------- ----------------
1,842,021 1,744,363
------------- ----------------
* Due to market conditions at renewal, the Directors' and
officers' insurance premium was subject to a large increase.
6. DIRECTORS' REMUNERATION
Under their terms of appointment, each Director is paid a fee for
their services as a director of the Company at a fee of GBP48,000
per annum, except for the Chair, who receives GBP59,000 per annum
and the Chair of Audit, who receives GBP57,000 per annum. The rate
of remuneration per director has remained unchanged.
7. UNREALISED FOREIGN EXCHANGE GAINS/(LOSSES)
1 Apr 2020 to 1 Apr 2019
3 0 Sep 2020 to
G BP 3 0 Sep 2019
G BP
Cash at bank (335,840) 488,187
Deferred income 5,457,465 (7,295,870)
Borrowings 7,607,212 (17,447,781)
12,728,837 (24,255,465)
------------- --------------
The foreign exchange gain in the Period reflects the 4.0 per
cent. movement in the Sterling/US dollar e
xchange rate from 1.242 as at 31 March 2020 t o 1.292 as at 3 0 September 2020.
8. DIVIDS IN RESPECT OF EQUITY SHARES
Dividends in respect of Shares 1 Apr 2020 to
30 Sep 2020
GBP Pence per
Share
First interim dividend 7,773,750 4.50
Second interim dividend 7,773,750 4.50
15,547,500 9.00
----------------- -----------
Dividends in respect of Shares 1 Apr 2019 to
30 Sep 2019
GBP Pence per
Share
First interim dividend 7,773,750 4.50
Second interim dividend 7,773,750 4.50
15,547,500 9.00
--------------------- -----------------
Refer to the Subsequent Events in note 23 in relation to dividends
declared in October 2020.
9. EARNINGS PER SHARE
Earnings per Share ("EPS") is based on the net profit for the Period
attributable to the Shareholders of GBP33,296,779 (30 Sep 2019: net
profit for the Period of GBP8,695,995) and 172,750,000 (30 Sep 2019:
172,750,000) Shares being the weighted average number of Shares in
issue during the Period.
There are no dilutive instruments and therefore basic and diluted
EPS are identical.
10. PROPERTY, PLANT AND EQUIPMENT - AIRCRAFT
TOTAL
GBP
COST
As at 1 Apr 2020 1,039,148,193
-----------------
As at 30 Sep 2020 1,039,148,193
-----------------
ACCUMULATED DEPRECIATION
As at 1 Apr 2020 373,722,841
Depreciation charge for the period 38,196,096
-----------------
As at 30 Sep 2020 411,918,937
-----------------
ACCUMULATED DEPRECIATION
As at 1 Apr 2020 68,465,211
-----------------
Impairment loss f or the period -
-----------------
A s at 30 Sep 2020 68,465,211
CARRYING AMOUNT
As at 30 Sep 2020 558,764,045
------------
As at 31 Mar 2020 596,960,140
------------
The Group is depreciating its Aircraft so as to ensure that the carrying value of its Aircraft
at the termination of its lease equals the uninflated residual dollar value determined at
31 March 2020 in accordance with methodology set out in note 3, translated into Sterling at
the exchange rate prevailing at 31 March 2020.
The Group can sell the Assets during the term of the leases (with the lease attached and in
accordance with the terms of the transfer provisions contained therein).
Under IFRS 16 the direct costs attributed in negotiating and arranging the operating leases
have been added to the carrying amount of the leased asset and therefore will be recognised
as an expense over the lease term. The costs have been allocated to each Aircraft based on
the proportional cost of the Asset.
Refer to note 3 for details on the impairment review conducted by the Company as at the 31
March 2020 year end.
11. FINANCE COSTS
1 Apr 2020 1 Apr 2019
to 30 Sep to 30 Sep
2020 2019
GBP GBP
Amortisation of debt arrangements
costs 511,171 511,171
Loan interest 5,620,392 7,834,843
Fair value adjustment on financial
assets and liabilities at fair
value through profit and loss (39,115) 228,099
------------------ ------------------
6,092,448 8,574,113
------------------ ------------------
12. OPERATING LEASES
The amounts of minimum future lease receipts at the reporting date
under non-cancellable operating leases are detailed below:
30 September 2020 Next 12
months 1 to 5 years After 5 years Total
GBP GBP GBP GBP
Aircraft - A rental
receipts 92,398,757 101,757,224 - 194,155,981
Aircraft - B rental
receipts 35,663,124 107,819,810 - 143,482,934
------------ ------------- -------------- ------------
128,061,881 209,577,034 - 337,638,915
------------ ------------- -------------- ------------
31 March 2020 Next 12
months 1 to 5 years After 5 years Total
GBP GBP GBP GBP
Aircraft - A rental
receipts 96,174,936 162,754,125 - 258,929,061
Aircraft - B rental
receipts 35,663,124 125,651,372 - 161,314,496
------------ ------------- -------------- ------------
131,838,060 288,405,497 - 420,243,557
------------ ------------- -------------- ------------
The operating leases are for seven Airbus A380-861 aircraft. The
terms of the leases are as follows:
MSN077 - term of the lease is for 12 years ending October 2023.
The initial lease is for 10 years ending October 2021, with an
extension period of 2 years ending October 2023, in which rental
payments reduce. The lease extension option was confirmed on 17
October 2019 and therefore extended by 2 years to the expiry date
of October 2023.
MSN090 - term of the lease is for 12 years ending December 2023.
The initial lease was for 10 years ending December 2021, with an
extension period of 2 years, in which rental payments reduce. The
lease extension option was confirmed on 5 December 2019 and therefore
extended by 2 years to the expiry date of December 2023.
MSN105 - term of the lease is for 12 years ending October 2024.
The initial lease is for 10 years ending October 2022, with an
extension period of 2 years ending October 2024, in which rental
payments reduce. The lease extension option was confirmed on 16
January 2020 and therefore extended by 2 years to the expiry date
of October 2024.
MSN106 - term of the lease is for 12 years ending October 2024.
The initial lease is for 10 years ending October 2022, with an
extension period of 2 years ending October 2024, in which rental
payments reduce. The lease extension option was confirmed on 16
January 2020 and therefore extended by 2 years to the expiry date
of October 2024.
MSN107 - term of the lease is for 12 years ending October 2024.
The initial lease is for 10 years ending October 2022, with an
extension period of 2 years ending October 2024, in which rental
payments reduce. The lease extension option was confirmed on 16
January 2020 and therefore extended by 2 years to the expiry date
of October 2024.
MSN109 - term of the lease is for 12 years ending November 2024.
The initial lease is for 10 years ending November 2022, with an
extension period of 2 years ending November 2024, in which rental
payments reduce. The lease extension option was confirmed on 16
January 2020 and therefore extended by 2 years to the expiry date
of November 2024.
MSN110 - term of the lease is for 12 years ending November 2024.
The initial lease is for 10 years ending November 2022, with an
extension period of 2 years ending November 2024, in which rental
payments reduce. The lease extension option was confirmed on 16
January 2020 and therefore extended by 2 years to the expiry date
of November 2024.
At the end of each lease the lessee has the right to exercise an
option to purchase the Asset if the Group chooses to sell the Asset.
If a purchase option event occurs the Group and the lessee will
be required to arrange for a current market value appraisal of
the Asset to be carried out by three independent appraisers. The
purchase price will be equal to the average valuation of those
three appraisals.
13. RECEIVABLES
30 Sep
2020 31 Mar 2020
GBP GBP
Prepayments 211,218 14,294
Sundry debtors 39,489 38,968
250,707 53,262
--------------- -----------------------
The above carrying value of receivables is equivalent to fair
value.
14. PAYABLES (amounts falling due within one year)
30 Sep 2020 31 Mar 2020
GBP GBP
Accrued administration fees 16,623 18,257
Accrued audit fee 21,960 28,110
Other accrued expenses 24,221 26,561
------------ ------------
62,804 72,928
------------ ------------
The above carrying value of payables is equivalent to the fair
value.
15. BORROWINGS
30 Sep 2020 31 Mar 2020
GBP GBP
Bank loans 80,164,067 103,024,411
Equipment Notes 118,009,906 145,434,612
------------ ------------
198,173,973 248,459,023
Associated costs (3,864,245) (4,375,416)
------------ ------------
194,309,728 244,083,607
------------ ------------
Current portion 84,473,794 85,703,367
============ ============
Non-current portion 109,835,934 158,380,240
============ ============
Notwithstanding the fact that GBP42.5 million (31 March 2020: GBP81.9
million) debt was repaid during the Period, as per the Consolidated
Statement of Cash Flows, the closing value of the value of the
borrowings decreased by GBP49.8 million (31 March 2020: GBP67.6
million) due to the 4.0 per cent movement in the Sterling / US
dollar exchange rate for the period from 1.242 at 31 March 2020
to 1.292 at 30 September 2020. See note 19.
The amounts below detail the future contractual undiscounted cash
flows in respect of the loans and Equipment Notes, including both
the principal and interest payments, and will not agree directly
to the amounts recognised in the Consolidated Statement of Financial
Position:
30 Sep 2020 31 Mar 2020
GBP GBP
Amount due for settlement within
12 months 92,234,483 96,011,173
------------ ------------
Amount due for settlement after
12 months 118,102,070 170,819,676
------------ ------------
The loan to MSN077 Limited was arranged with Westpac Banking Corporation
("Westpac") for $151,047,059 and runs for 12 years until October
2023 and has an effective interest rate of 4.590 per cent.
The loan to MSN090 Limited was arranged with The Australia and
New Zealand Banking Group Limited ("ANZ") for $146,865,575 and
runs for 12 years until December 2023 and has an effective interest
rate of 4.558 per cent.
The loan to MSN105 Limited was arranged with ICBC, BoC and Commerzbank
for $145,751,153 and runs for 12 years until October 2024 and has
an effective interest rate of 4.780 per cent.
Each loan is secured on one Asset. No significant breaches or defaults
occurred in the Period. The loans are either fixed rate over the
term of the loan or have an associated interest rate swap contract
issued by the lender in effect fixing the loan interest over the
term of the loan. Transaction costs of arranging the loans have
been deducted from the carrying amount of the loans and will be
amortised over their respective lives.
In order to finance the acquisition of the fourth, fifth, sixth
and seventh Assets, Doric Nimrod Air Finance Alpha Limited ("DNAFA")
used the proceeds of the May 2012 offering of Pass Through Certificates
(the "Certificates"). The Certificates have an aggregate face amount
of approximately $587.5 million, made up of "Class A" certificates
and "Class B" certificates. The Class A certificates in aggregate
have a face amount of $433,772,000 with an interest rate of 5.125
per cent. and a final expected distribution date of 30 November
2022. The Class B certificates in aggregate had a face amount of
$153,728,000 with an interest rate of 6.5 per cent. and were repaid
on 30 May 2019. There is a separate trust for each class of Certificates.
The trusts used the funds from the Certificates to acquire Equipment
Notes. The Equipment Notes were issued to Wilmington Trust, National
Association as pass through trustee in exchange for the consideration
paid by the purchasers of the Certificates. The Equipment Notes
were issued by DNAFA and the proceeds from the sale of the Equipment
Notes financed a portion of the purchase price of the four Airbus
A380-861 aircraft, with the remaining portion being financed through
contribution from the Company of the C Share issue proceeds. The
holders of the Equipment Notes issued for each aircraft will have
the benefit of a security interest in such aircraft. The remaining
balance is being repaid by continuing to amortise borrowings that
pays both principal and interest through periodic payments.
In the Directors' opinion and with reference to the terms mentioned,
the above carrying values of the bank loans and Equipment Note
are approximate to their fair value.
16. SHARE CAPITAL
The Share Capital of the Group is represented by an unlimited number
of shares of no par value being issued or reclassified by the Group
as Shares, C Shares or Administrative Shares (together the "Share
Capital").
Issued Administrative
Shares Shares C Shares
Issued shares as at 30 Sep
2020 and 31 Mar 2020 2 172,750,000 -
------------------ ------------ ----------------------
Issued Administrative
Shares Shares C Shares Total
GBP GBP GBP GBP
Share Capital
Total Share Capital
as at 30 Sep 2020
and as at 31 Mar
2020 2 319,836,770 - 319,836,770
------------------ ------------ ---------------------- ------------
Members holding Shares are entitled to receive and participate
in any dividends out of income attributable to the Share, other
distributions of the Group available for such purposes and resolved
to be distributed in respect of any accounting period, or other
income or right to participate therein.
Upon winding up, Shareholders are entitled to the surplus assets
attributable to the Shares class remaining after payment of all
the creditors of the Group. However the Board has considered the
potential impact of the COVID-19 pandemic (the "Pandemic") on the
arrangements for the annual general meeting (the "AGM"). The Group
is required by The Companies (Guernsey) Law, 2008, as amended,
to hold an AGM. Measures taken by the States of Guernsey in response
to the Pandemic mean that attendance at the AGM by shareholders
who are not residents of Guernsey is not reasonably practicable.
Of those measures, the most relevant to the AGM is the legal requirement
that anyone arriving in Guernsey from anywhere in the world including,
for the avoidance of doubt, the United Kingdom, will be required
to self-isolate for up to 14 days upon their arrival.
Due to the Pandemic there will be no opportunity to interact with
the directors. However, the Board considers it important that all
shareholders have the opportunity to make their views known and
to exercise their voting rights at the AGM. The Group strongly
encourages all shareholders to exercise their votes in respect
of the meeting in advance and to submit any questions they may
have to either the Secretary or the Corporate and Shareholder Adviser.
On 6 March 2013, 100,250,000 C Shares were converted into Shares
with a conversion of 1:1.
The holders of Administrative Shares are not entitled to receive,
and participate in, any dividends out of income; other distributions
of the Group available for such purposes and resolved to be distributed
in respect of any accounting period; or other income or right to
participate therein. On a winding up, holders are entitled to a
return of capital paid up on them after the Ordinary Shares have
received a return of their capital paid up but ahead of the return
of all additional capital to the holders of Shares.
The holders of Administrative Shares shall not have the right to
receive notice of and no right to attend, speak and vote at general
meetings of the Group, except for the Liquidation Proposal Meeting
(general meeting convened six months before the end term of the
Leases where the Liquidation Resolution will be proposed) or if
there are no Shares in existence.
17. CASH AND CASH EQUIVALENTS
30 Sep 2020 31 Mar 2020
GBP GBP
Cash at bank 29,940,565 16,916,567
Cash deposits - 13,100,204
------------ ------------
29,940,565 30,016,771
------------ ------------
Cash and cash equivalents are highly liquid, readily convertible
and are subject to insignificant risk of changes in value.
18. FINANCIAL INSTRUMENTS
The Group's main financial instruments comprise:
(a) Cash and cash equivalents that arise directly from the Group's
operations;
(b) Loans secured on non-current assets; and
(c) Interest rate swap
19. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES
The Group's objective is to obtain income and returns and a capital
return for its Shareholders by acquiring, leasing and then selling
aircraft.
The following table details the categories of financial assets
and liabilities held by the Group at the reporting date:
30 Sep 2020 31 Mar 2020
GBP GBP
Financial assets
Cash and cash equivalents 29,940,565 30,016,771
Receivables (excluding prepayments) 39,489 38,968
------------ ------------
Financial assets at amortised cost 29,980,054 30,055,739
------------ ------------
Financial liabilities
Interest rate swap 216,815 255,930
------------ ------------
Financial liabilities at fair value through
profit or loss 216,815 255,930
------------ ------------
Payables 62,804 72,928
Debt payable 198,173,973 248,459,023
------------ ------------
Financial liabilities measured at amortised
cost 198,236,777 248,531,951
------------ ------------
In accordance with IFRS 13, 'Fair value measurement' this
standard requires the Group to price its financial assets and
liabilities using the price in the bid-ask spread that is most
representative of fair value for both financial assets and
financial liabilities. An active market is a market in which
transactions for the asset or liability take place with sufficient
frequency and volume to provide pricing information on an ongoing
basis.
The level of the Fair Value Hierarchy of an instrument is
determined considering the inputs that are significant to the
entire measurement of such instrument and the level of the fair
value hierarchy within those inputs are categorised.
The hierarchy is broken down into three levels based on the
observability of inputs as follows:
Level 1: Quoted price (unadjusted) in an active market for an
identical instrument.
Level 2: Valuation techniques based on observable inputs, either
directly (i.e. as prices) or indirectly (i.e. derived from
prices).
Level 3: Valuation techniques using significant unobservable
inputs.
The interest rate swap is the only financial instrument held at
fair value through profit or loss and is considered to be level 2
in the Fair Value Hierarchy.
Derivative financial instruments
The following table shows the Group's derivative position:
Financial liability Notional
30 Sep 2020 at fair value amount Maturity
GBP USD
Interest Rate Swap
MSN090 Loan 216,815 14,308,782 4 Dec 2023
-------------------- -----------
Financial liability Notional
31 Mar 2020 at fair value amount Maturity
GBP USD
Interest Rate Swap
MSN090 Loan 255,930 18,363,118 4 Dec 2023
-------------------- -----------
The main risks arising from the Group's financial instruments
are capital management risk, foreign currency risk, credit risk,
liquidity risk and interest rate risk. The Board regularly reviews
and agrees policies for managing each of these risks and these are
summarised below:
(a) Capital Management
The Group manages its capital to ensure that the Group will be
able to continue as a going concern while maximising the return to
Shareholders through the optimisation of the debt and equity
balance.
The capital structure of the Group consists of debt, which
includes the borrowings disclosed in note 15, cash and cash
equivalents and equity attributable to equity holders, comprising
issued capital and retained earnings.
The Group's Board of Directors reviews the capital structure on
a bi-annual basis.
Equity includes all capital and reserves of the Group that are
managed as capital.
No changes were made in the objectives, policies or processes
for managing capital during the Period (None for the period from 1
April 2019 to 30 September 2019).
(b) Foreign Currency Risk
The Group's accounting policy under IFRS requires the use of a
Sterling historic cost of the assets and the value of the US dollar
debt as translated at the spot exchange rate on every Statement of
Financial Position date. In addition US dollar operating lease
receivables are not immediately recognised in the Consolidated
Statement of Financial Position and are accrued over the period of
the leases. The Directors consider that this introduces an
artificial variance due to the movement over time of foreign
exchange rates. In actuality, the US dollar operating leases should
offset the US dollar payables on amortising loans. The foreign
exchange exposure in relation to the loans is thus almost entirely
hedged.
Lease rentals (as detailed in notes 4 and 12) are received in US
dollar and Sterling. Those lease rentals received in US dollar are
used to pay the debt repayments due, also in US dollar (as detailed
in note 15). Both US dollar lease rentals and debt repayments are
fixed and are for similar sums and similar timings. The matching of
lease rentals to settle debt repayments therefore minimises risks
caused by foreign exchange fluctuations.
The carrying amounts of the Group's foreign currency denominated
monetary assets and liabilities at the reporting date are as
follows:
30 Sep 2020 31 Mar 2020
GBP GBP
Debt (US dollar) - Liabilities (198,173,973) (248,459,023)
Financial (liabilities) and assets
at fair value through profit or
loss (216,815) (255,930)
Cash and cash equivalents (US dollar)
- Asset 9,890,502 10,223,979
-------------- --------------
The following table details the Group's sensitivity to a 25 per
cent. (31 March 2019: 25 per cent.) appreciation and depreciation
in Sterling against the US dollar. 25 per cent. (31 March 2019:
25 per cent.) represents the Directors' assessment of the reasonably
possible change in foreign exchange rates. The sensitivity analysis
includes only outstanding foreign currency denominated monetary
items and adjusts their translation at the period end for a 25
per cent. (31 March 2019: 25 per cent.) change in foreign currency
rates. A positive number below indicates an increase in profit
and other equity where Sterling strengthens 25 per cent. (31 March
2019: 25 per cent.) against the US dollar. For a 25 per cent. (31
March 2019: 25 per cent.) weakening of the Sterling against the
US dollar, there would be a comparable but opposite impact on the
profit and other equity:
30 Sep 2020 31 Mar 2020
GBP GBP
Profit or loss 37,700,057 47,698,195
Assets (1,934,737) (1,993,610)
Liabilities 39,634,795 49,691,805
------------ ------------
On the eventual sale of the Assets, the Company will be subject
to foreign currency risk if the sale settled in a currency other
than Sterling. Transactions in similar assets are typically priced
in US dollars.
(c) Credit Risk
Credit risk refers to the risk that a counterparty will default
on its contractual obligations resulting in financial loss to the
Group.
Refer to the going concern section on pages 22 to 23 where an
assessment of Emirates is made.
The credit risk on cash transactions is mitigated by transacting
with counterparties that are regulated entities subject to
prudential supervision, or with high credit ratings assigned by
international credit rating agencies.
The Group's financial assets exposed to credit risk are as
follows:
30 Sep 2020 31 Mar 2020
GBP GBP
Receivables (excluding prepayments) 39,489 38,968
Cash and cash equivalents 29,940,565 30,016,771
------------ ------------
29,980,054 30,055,739
------------ ------------
Surplus cash in the Company is held in Barclays. Surplus cash in
the Subsidiaries is held in accounts with Barclays, Westpac and
ANZ, which have credit ratings given by Moody's of P-1, P-1, P-1
respectively.
There is a contractual credit risk arising from the possibility
that the lessee may default on the lease payments. This risk is
mitigated, as under the terms of the lease agreements between the
lessee and the Group, any non-payment of the lease rentals constitutes
a "Special Termination Event", under which the lease terminates
and the Group may either choose to sell the Asset or lease the
Assets to another party.
At the inception of each lease, the Group selected a lessee with
a strong statement of financial position and financial outlook.
The financial strength of Emirates is regularly reviewed by the
Board and the Asset Manager.
(d) Liquidity Risk
Liquidity risk is the risk that the Group will encounter difficulty
in realising assets or otherwise raising funds to meet financial
commitments. The Group's main financial commitments are its ongoing
operating expenses, loan repayments to Westpac, ANZ, ICBC, BoC
and Commerzbank, and repayments on equipment notes.
Ultimate responsibility for liquidity risk management rests with
the Board of Directors, which established an appropriate liquidity
management framework at the incorporation of the Group, through
the timings of lease rentals and debt repayments. The Group manages
liquidity risk by maintaining adequate reserves by monitoring forecast
and actual cash flows, and by matching profiles of financial assets
and liabilities.
The table below details the residual contractual maturities of financial
liabilities, including estimated interest payments. The amounts below
are contractual undiscounted cash flows, including both the principal
and interest payments, and will not agree directly to the amounts
recognised in the consolidated statement of financial position:
30 Sep 2020 1-3 3-12 1-2 years 2-5 years Over 5
months months years
GBP GBP GBP GBP GBP
Financial liabilities
Payables
- due within
one period 62,804 - - - -
Bank loans 10,469,765 31,409,296 37,429,245 5,342,283 -
Equipment
Notes 25,194,862 31,284,017 69,213,933 - -
----------- ----------- ------------ ----------
35,727,431 62,693,313 106,643,178 5,342,283 -
----------- ----------- ------------ ----------
31 Mar 2020 1-3 3-12 1-2 years 2-5 years Over 5
months months years
GBP GBP GBP GBP GBP
Financial liabilities
Payables
- due within
one year 72,928 - - - -
Interest
rate swap - - - 255,930 -
Bank loans 10,891,253 32,673,760 37,885,837 28,390,079 -
Equipment
Notes 26,237,012 26,209,148 52,331,901 52,211,859 -
----------- ----------- ----------- -----------
37,201,193 58,882,908 90,217,738 80,857,868 -
----------- ----------- ----------- -----------
(e) Interest Rate Risk
Interest rate risk arises from the possibility that changes in interest
rates will affect future cash flows. It is the risk that fluctuations
in market interest rates will result in a reduction in deposit interest
earned on bank deposits held by the Group. The MSN090 Limited loan
which is at a variable rate, has an associated interest rate swap
contract issued by the lender in effect fixing the loan interest
over the term of the loan.
The Group mitigates interest rate risk by fixing the interest rate
on its debts with the exception of MSN090 Limited, which has an associated
interest rate swap as mentioned above. The lease rentals are also
fixed.
The following table details the Group's exposure to interest rate
risks:
Variable Fixed Non-interest
interest interest bearing Total
GBP GBP GBP GBP
30 Sep 2020
Financial assets
Receivables (excluding
prepayments) - - 39,489 39,489
Cash and cash equivalents 29,940,565 - - 29,940,565
----------- ------------ ------------- ------------
Total Financial
Assets 29,940,565 - 39,489 29,980,054
----------- ------------ ------------- ------------
Financial liabilities
Interest rate swap 216,815 - - 216,815
Payables - - 62,804 62,804
Bank loans - 80,164,067 - 80,164,067
Equipment Notes - 118,009,906 - 118,009,906
----------- ------------ ------------- ------------
Total Financial
Liabilities 216,815 198,173,973 62,804 198,453,592
----------- ------------ ------------- ------------
Total interest
sensitivity gap 29,723,750 198,173,973
----------- ------------
Variable Fixed Non-interest
interest interest bearing Total
GBP GBP GBP GBP
31 Mar 2020
Financial Assets
Receivables (excluding
prepayments) - - 38,968 38,968
Cash and cash
equivalents 30,016,771 - - 30,016,771
----------------- ----------------- ---------------------- ------------
Total Financial
Assets 30,016,771 - 38,968 30,055,739
----------------- ----------------- ---------------------- ------------
Financial liabilities
Interest rate
swap 255,930 - - 255,930
Payables - - 72,928 72,928
Bank loans - 103,024,411 - 103,024,411
Equipment Notes - 145,434,612 - 145,434,612
----------------- ----------------- ---------------------- ------------
Total Financial
Liabilities 255,930 248,459,023 72,928 248,787,881
----------------- ----------------- ---------------------- ------------
Total interest
sensitivity gap 29,760,841 248,459,023
----------------- -----------------
If interest rates had been 50 basis points higher throughout the
Period and all other variables were held constant, the Group's
net assets attributable to Shareholders as at 30 September 2020
would have been GBP148,619 (31 March 2020: GBP148,804) greater
due to an increase in the amount of interest receivable on the
bank balances.
If interest rates had been 50 basis points lower throughout the
Period and all other variables were held constant, the Group's
net assets attributable to Shareholders as at 30 September 2020
would have been GBP148,619 (31 March 2020: GBP148,804) lower due
to a decrease in the amount of interest receivable on the bank
balances.
20 CHANGES IN LIABILITIES ARISING FROM FINANCING ACTIVITIES
The following table discloses the effects of the amendments to
IAS 7 Statement of Cash Flows which requires additional disclosures
that enable users of financial statements to evaluate changes in
liabilities arising from financing activities, including both changes
arising from cash flows and non-cash flows.
The table below excludes non-cash flows arising from the amortisation
of associated costs (see note 15).
30 Sep 2020 30 Sep 2019
GBP GBP
Opening Balance 248,459,023 317,100,191
Cash flows paid - capital (42,520,674) (41,920,232)
Cash flows paid - interest (5,777,560) (7,658,692)
Non-cash flows
* Interest accrued 5,620,392 7,834,843
* Effects of foreign exchange (7,607,208) 17,447,781
------------- -------------
Closing Balance 198,173,973 292,803,891
------------- -------------
21 ULTIMATE CONTROLLING PARTY
In the opinion of the Directors, the Group has no ultimate controlling
party.
22 RELATED PARTY TRANSACTIONS AND MATERIAL CONTRACTS
Doric GmbH ("Doric") is the Group's Asset Manager. The Group pays
Doric a management and advisory fee of GBP250,000 per annum (adjusted
annually for inflation from 2013 onwards, at 2.25 per cent. per
annum), payable quarterly in arrears.
During the Period, the Group incurred GBP1,052,034 (30 September
2019: GBP1,028,910) of expenses with Doric which consisted of asset
management fees of GBP1,045,477 (30 September 2019: GBP1,022,472)
as shown in note 5, liaison agency fees of GBP2,930 (30 September
2019: GBP5,794) and reimbursed expenses of GBP632 (30 September
2019: GBP644). At 30 September 2020, GBP1,842 (31 March 2020: GBP7,767)
was prepaid to this related party.
Ni mrod Capital LLP (" Ni mrod ") is the Co mpany's Corporate and
Shareholder Adv i sor.
During the Period, the Group incurred GBP443,683 (30 September
2019: GBP424,224) of expenses with Nimrod, of which GBPnil (31
March 2020: GBPnil) was outstanding to this related party at 30
September 2020. GBP432,378 (30 September 2019: GBP422,864) related
to corporate shareholder and advisor fees as shown in note 5 and
GBP11,305 (30 September 2019: GBPnil) have been incurred as cancellation
costs in relation to the Farnborough Airshow.
JTC Registrars Limited ("JTC Registrars") is the Group's registrar,
transfer agent and paying agent. During the Period , the Group
incurred GBP10,853 (30 September 2019: GBP7,839) of expenses with
JTC Registrars as shown in note 5. As at 30 September 2020, GBP1,945
(31 March 2020: GBP1,269) was owing to this related party.
23 SUBSEQUENT EVENTS
On 15 October 2020, a further dividend of 4.5 pence per Share was
declared and this was paid on 30 October 2020.
A D V I S O R S A ND C O N T A CT I N F O R M A T ION
K E Y I N F O R M A T ION
E x chan ge: Special ist Fund S e gme nt of t he London S t o ck
E xchan g e's M a in M ark et
T i c k e r: DN A2
Li st ing Da te: 14 July 2011
Financial Year End: 31 M arch
Ba se Curre ncy: Pound Sterling
I S I N: GG 00B3Z62522
SED O L: B3Z6252
LEI: 213800ENH57LLS7MEM48
Coun t ry of I ncorpora t ion: G uernsey
Re g i s t ra t ion number: 52985
M A N A G E ME NT A ND A DMI N I S T R A T ION
Reg i s tered Off i ce Compa ny Secretary a nd A dmi n i s
trator
D o ric Nimrod A ir T wo Limi t ed JTC Fund Solutions ( G uernse
y) Limi t ed
G round Floor Ground Floor
Do rey Court Dorey Court
Ad miral Pa rk Admiral Pa rk
S t Pe t er P ort St Pe t er P ort
G ue rnsey G Y1 2 HT G uernsey G Y1 2 HT
A s se t Manager L i a i son A gent
D o ric GmbH Amedeo Serv ices (UK) L imi t ed
Be rliner S t r asse 114 29-30 Cornhill
6306 5 O ff enb ach am M a in London, England
G e r many E C 3V 3 NF
Corporate and Shareholder Advisor Lease and Debt Arranger
Ni mrod Capi t al LLP Doric Asset Finance Gm bH & Co. KG
New Derwent House Berliner S t r asse 114
69-73 Theobalds Road 63065 O ff enb ach am M a in
Londo n, England G e rmany
WC1X 8TA
So li c i tors to the Comp a ny A d vocates to the Co m pa
ny
(as to Eng l i sh L a w) (as to G u ernsey Law)
He rbert Smi th Freehills LLP Carey Olsen
E x chan ge House Carey House
P rimrose S treet Les Banques
Londo n St Peter Port
EC2 A 2EG G uernsey G Y1 4BZ
Reg i s trar A u d itor
JTC Re g i s trars L imi t ed Deloi tte LLP
Ground Floor, Do rey Court Re g ency Cou rt
Ad miral Pa rk G la t e g ny Esplanade
S t Pe t er P ort St Pe t er P ort
G ue rnsey G Y1 2 HT G uernsey G Y1 3 HW
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END
IR BRBDDBDBDGGG
(END) Dow Jones Newswires
December 10, 2020 12:35 ET (17:35 GMT)
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