TIDMHLS
RNS Number : 5872K
Helesi PLC
22 April 2010
22 April 2010
Helesi PLC
("Helesi", "the Company" or "the Group")
Final Results for the year to 31 December 2009
Helesi PLC (AIM: HLS), the Greece, Italy and Cyprus based waste management
products manufacturer and services supplier announces final results for the year
to 31 December 2009.
Highlights
· Group revenues increased by 12% to EUR73.9 million (2008: EUR65.8 million):
· Profit before finance charges and tax EUR8.9 million (2008: EUR10.5 million)
· Net profit EUR2.8 million (2008: EUR6.6 million) as a result of increased
cost of financing (EUR4.5 million compared to EUR3.2 million in 2008).
· Remains cash positive despite unprecedented trading conditions, with
operating cash flow of EUR2.5 million (2008: EUR7.0 million).
· Transformation in scale of Vehicles division means Company now has
critical scale for high margin supply and distribution of specialist waste
collection vehicles both in Greece and Cyprus - fulfillment of two large
contracts in 2009
o Municipality of Athens contract, worth an initial EUR14.5 million,
o EUR10 million contract with the Prefecture of East Macedonia Thrace for the
supply of specialist waste vehicles.
· Year end net debt at EUR71.7 million (2008: EUR70 million) as a result of
completion of investment programme, delays in receipt of government grants and
slower payment by customers.
· Appointment of Dimitri Goulandris as Non-Executive Chairman, Apostolos
Binomakis moves to Non Executive Director from Chief Financial Officer,
appointment to the Board of Ioannis Tolias as Chief Financial Officer.
Commenting on the results, Sakis Andrianopolous, Chief Executive of Helesi,
said: "Despite the generally weak economic environment Helesi remains a cash
generative business and, even though it could sustain the current level of
borrowings pending receipt of the outstanding government grants, the Board
continues to believe that it is prudent to prioritize the reduction in the level
of borrowings.
"We enter 2010 with expanded cost competitive manufacturing facilities, and a
vehicles and equipment business that now has the scale and resources to tender
for the largest of projects in our area of geographical focus."
For further information please visit www.helesi.com or contact:
+--------------------------------------+--------------------------+
| Helesi PLC | +30 (0) 22990 82700 |
+--------------------------------------+--------------------------+
| Sakis Andrianopoulos, Chief | |
| Executive | |
+--------------------------------------+--------------------------+
| Ioannis Tolias, Finance Director | itolias@helesi.com |
| | |
+--------------------------------------+--------------------------+
| Panmure Gordon (Nomad and broker) | +44 (0) 20 7459 3600 |
+--------------------------------------+--------------------------+
| Andrew Godber | |
+--------------------------------------+--------------------------+
| | |
+--------------------------------------+--------------------------+
| Tavistock Communications | + 44 (0) 20 7920 |
| | 3150 |
+--------------------------------------+--------------------------+
| Simon Hudson | shudson@tavistock.co.uk |
+--------------------------------------+--------------------------+
| Gemma Bradley | gbradley@tavistock.co.uk |
+--------------------------------------+--------------------------+
Chairman's Statement
The nadir of the global economic crisis, 2009, was a challenging year for almost
all businesses in almost all sectors. Helesi was not immune but managed to
perform reasonably given the torrid environment.
I took over as non-executive Chairman on 24th June 2009 after the death of Roger
Parsons who had been Chairman of the Company for two years. Along with my
appointment, Apostolos Binomakis, the Company's CFO resigned and became a
non-executive director and the Company hired Ioannis Tolias from ABN Amro as its
new Chief Financial Officer.
Whilst the Company continues to have strong growth prospects, my immediate focus
is to drive cash generation and to pay down debt to enable the Company to return
to growth once a more stable capital structure has been restored. Selectively
the Company may look to expand beyond its core markets of Greece and Italy but
only on condition of payment terms that ensure that new markets will be cash
generative in 2010.
Outlook
We expect 2010 to be another difficult year as EU budget cuts and credit issues
in Greece and Italy affect our payment terms. We are focused on managing our
cost base and our receivables to ensure that we generate as much cash as
possible. We expect our sales to be at similar levels to that of last year.
As always, we are grateful for the dedication and enterprise of our staff in
Greece, Italy, Cyprus and around the world. We thank them all for the
contribution they have made to Helesi and seek their continued commitment in
2010.
Dimitri Goulandris
Non-executive Chairman
21 April 2010
Chief Executive's Review of Operations
Despite the worsening economic environment during the year, Helesi continued to
be cash positive, although at lower levels than the year before, with operating
cash flow of EUR2.5 million (2008: EUR7.0 million). The worldwide recession did not
allow for the reduction of our borrowings as planned. Customers took longer to
pay and required more funding, and the agreed government grants were not
received in full, and were late in arriving. Together with the completion of our
three year, EUR87 million investment program, this has meant that net debt peaked
at the year end at higher levels than originally anticipated. However we
estimate that the remaining EUR11.3 million from grants will be collected within
2010, and allow net debt to be reduced to more normal levels.
Results
Group sales revenues continued to grow, albeit at a slower pace, up by 12% in
2009 to EUR73.9 million (2008: EUR65.8 million) mainly supported by the outstanding
performance of the vehicles division. EBITDA was similar at EUR12.7 million (2008:
EUR12.8 million). After increased costs and depreciation largely relating to the
additional capacity created by the investment program, this resulted in profit
before interest and taxation of EUR8.9 million (2008: EUR10.5 million), a decrease
of 14.7%. However, the continuing high levels of debt throughout the year
resulted in a 40% increase in cost of financing to EUR4.5 million (2008: EUR3.2
million). Consequently profit before tax dropped to EUR4.4 million (2008: EUR7.3
million). Net profits, after a 35% tax charge (2008: 9.2%), reduced to EUR2.8
million (2008: EUR6.6 million) and basic and fully diluted earnings per share were
EUR0.08 (2008: EUR0.20).
The level of net debt rose slightly during 2009 to a year end figure of EUR71.7
million (2008: EUR70 million). This accommodated the completion of the investment
program but also, and unexpectedly, reflected the worsening payment terms from
customers against a normalized 120 days. In addition there was a delay in the
payment of government grants to support the program in Greece and Italy. Our
priority remains to secure the receipt of government grants expected in full
this year to reduce the level of short term borrowing.
Despite the generally weak economic environment Helesi remains a cash generative
business and, even though it could sustain the current level of borrowings
pending receipt of the outstanding government grants, the Board continues to
believe that it is prudent to prioritize a reduction in the level of borrowings.
The Board is exploring a number of measures to sustain the Company's cash flow
further, by partially rescheduling its long-term debt obligations, and
diversifying part of its client base.
Dividend
Given the current economic climate and the temporarily high level of Group
borrowing, the Board is not recommending the payment of a dividend in respect of
2009.
Operations
Due to the budgetary constraints of Helesi clients across all geographical
regions, the sales mix of our revenues has changed. In 2009, revenues were split
43%, 46%,11% in terms of Plastic Products (principally bins and pallet boxes),
Vehicles and Services. This compares with 59%, 24%,17% in 2008 and reflects a
slowdown in sales growth of Plastic Products and Services mitigated by increased
sales in Vehicles. The changing sales mix, has slightly affected operating
margins which resulted at 17.2% in 2009 (2008: 19.3%).
Investment Program
The investment program is now complete. The EUR25 million new plant to produce
pallet boxes and food containers in southern Italy was completed and production
commenced, supporting Group sales mainly in the second half of 2009. Due to the
economic environment, we now expect a more gradual build up to target production
levels than originally predicted and these levels are now expected in the second
half of 2011. The new plant for production of wheeled bins at Komotini in
northern Greece was completed in February 2009 and commercial production
commenced subsequently. Both projects were completed on budget and as a result
of the increased available capacity they bring, Helesi reported in its Interim
Results the cessation of production in the UK. UK demand can be satisfied from
the unutilized Greek capacity. The UK continued to operate as an assembly and
distribution center. Consequently, in 2010 the management decided to sell part
of the assets to Straight PLC, and enter into a strategic alliance with that
company for the UK and Ireland.
The completion of the investment program, which doubled our pre-IPO
manufacturing capacity, marks an end for now to the substantial organic
expansion of manufacturing capacity in Plastic Products. We take immense pride
in our capital investment. Helesi has delivered state-of-the-art facilities, new
injection moulding lines, more moulds, upgraded robotics systems, and doubled
silo capacity. The efficiency upgrades will enable the Division to maintain its
competitive advantages in terms of cost and quality. We will now seek to
increase the return we generate on this investment as conditions improve.
Plastic Products
Utilisation rates across all production sites in Komotini Greece, at Bradford
UK, and Pisticci in Italy were almost 50% of the actual capacity. The world
recession resulted in volume reduction - especially in the fourth quarter of
2009 - which combined with slightly lower price levels affected the Group's
sales top line.
Waste Management Services
Services Revenue declined in 2009 reflecting the budgetary restriction the Greek
municipalities were facing throughout the year. In addition, the year's results
do not reflect the revenue contribution from the 10 year waste transfer station
contract in Cyprus. This is because although the construction of one of the two
stations is complete, the construction of the second station has not proceeded
according to plan. The delay was due to the change of the location of the
station, as the local community near the original site is opposed to its
construction. In accordance with the contract the Group is entitled to
significant compensation for delays and non-performance based upon stated
criteria. Encouragingly the authorities have now indicated a new location, and
the intention is to operate one station until the construction of the second one
is complete. Our goal is to grow our waste management activities and expand our
portfolio of services, focusing both on Greece and Cyprus where the principal
drivers continue to be legislative and regulatory.
Waste Management Vehicles and Equipment
The acquisition in November 2007 of the Perivallontiki businesses, and their
subsequent integration during the first half of 2008, transformed this Division.
Helesi now has the critical scale necessary to become a leading player in the
high margin supply and distribution of specialist waste collection vehicles both
in Greece and Cyprus. This new scale was illustrated with the fulfillment of
large contracts in 2009. The Municipality of Athens contract, worth EUR14.5
million initially plus EUR1 million per annum in services for five years has been
completed as scheduled in the second half of 2009. Another large contract worth
EUR10 million with the Prefecture of East Macedonia Thrace for the supply of
specialist waste vehicles and ancillary related equipment has also been
successfully completed.
Board
In June, we announced the appointment of Dimitri Goulandris as non-executive
Chairman in succession to Sakis Andrianopoulos who had taken on the role on an
interim basis after the death of Roger Parsons. Dimitri is Managing Partner of
Cycladic Capital LLP, which he set up in November 2002 to focus on making public
and private investments in small and medium sized companies predominantly in
Europe. Previously, Dimitri set up and ran the European operations of the
private equity firm Whitney & Company and spent eight years at Morgan Stanley in
the private equity group, structuring derivative products and executing mergers
and acquisitions both in New York and in London. Dimitri has an MBA from Harvard
Business School and a Masters in Electrical and Information Sciences from
Cambridge University.
At the AGM in July, Frithjof Stoud Platou retired as a non-executive director.
Mr Platou had been a director of Helesi since its IPO and his advice, based on
long experience of commerce and finance, will be missed. The Board wishes him a
very happy retirement.
Outlook
The impact of the global recession on plastic prices and budgetary constraints
on local municipalities slowing expansion of Waste Services will be more evident
in 2010. The Group's performance in the currently difficult economic environment
represents a very creditable achievement and thanks are due to all the Group's
management and staff for their hard work.
Helesi will continue its businesses for the year as a whole, although growth in
some geographical areas will be slower than previously anticipated due to the
effects of the recession. In the first quarter of 2010 the Group has a pipeline
of EUR40 million of products and services. Helesi entered new markets such as
India, Abu Dhabi, and Qatar to diversify our revenue stream. Moreover in Waste
Services, Helesi is seeking opportunities to participate in tenders in South
East Europe, capitalising on the Group's past experience in handling mass scale
projects. In addition, Waste Management Services is repositioning itself in the
Greek market aiming for waste collection services apart from those already
provided to government bodies, which contracts under new Greek laws will not be
renewed.
The principal focus for the short term is on cash collection and management. In
parallel, the Group will also focus on progressing plans to reduce net debt.
Since the year end the directors can report that further grant payments totaling
EUR2 million have been received and, as announced on 8 March 2010, the sale of the
business and parts of the assets of its UK operations for EUR1.7 million in cash.
The management has reacted rapidly to market developments, putting in action a
step by step cost reduction program and a Group restructuring.
We enter 2010 with expanded cost competitive manufacturing facilities and a
vehicles and equipment business that now has the scale and resources to tender
for the largest of projects in our area of geographical focus.
Sakis Andrianopoulos
Chief Executive Officer
21 April 2010
Statement of comprehensive income
+-----------------------------------+----------+---------------+------------+
| | | 31 December | 31 |
| | | 2009 | December |
| | | | 2008 |
+-----------------------------------+----------+---------------+------------+
| | Notes | EUR000 | EUR000 |
+-----------------------------------+----------+---------------+------------+
| Sales revenue | 2 | 73,998 | 65,803 |
+-----------------------------------+----------+---------------+------------+
| Other revenue | 3 | 1,228 | 1,061 |
+-----------------------------------+----------+---------------+------------+
| Changes in inventories of | | 2,371 | (521) |
| finished goods | | | |
+-----------------------------------+----------+---------------+------------+
| Cost of materials used | | (44,125) | (34,089) |
+-----------------------------------+----------+---------------+------------+
| Personnel-related costs | 4 | (7,750) | (6,247) |
+-----------------------------------+----------+---------------+------------+
| Directors' emoluments | | (295) | (305) |
+-----------------------------------+----------+---------------+------------+
| Depreciation charges | 5 | (3,770) | (2,374) |
+-----------------------------------+----------+---------------+------------+
| Other operating expenses | | (12,722) | (12,846) |
+-----------------------------------+----------+---------------+------------+
| Cost of financing, net | 6 | (4,530) | (3,200) |
+-----------------------------------+----------+---------------+------------+
| | | --------- | --------- |
+-----------------------------------+----------+---------------+------------+
| Profit before taxes | | 4,405 | 7,282 |
+-----------------------------------+----------+---------------+------------+
| Income taxes | 7 | (1,539) | (673) |
+-----------------------------------+----------+---------------+------------+
| | | --------- | --------- |
+-----------------------------------+----------+---------------+------------+
| Income of the year | | 2,866 | 6,609 |
+-----------------------------------+----------+---------------+------------+
| | | --------- | --------- |
+-----------------------------------+----------+---------------+------------+
| EBITDA | | 12,705 | 12,856 |
+-----------------------------------+----------+---------------+------------+
| | | 711 | (1,354) |
| Currency translation adjustments | | | |
+-----------------------------------+----------+---------------+------------+
| Other | | - | - |
+-----------------------------------+----------+---------------+------------+
| Total comprehensive income | | 3,577 | 5,255 |
+-----------------------------------+----------+---------------+------------+
| | | --------- | --------- |
+-----------------------------------+----------+---------------+------------+
| Basic and diluted earnings per | 19 | 0.08 | 0.20 |
| share (in Euro) | | | |
+-----------------------------------+----------+---------------+------------+
| | | --------- | --------- |
+-----------------------------------+----------+---------------+------------+
Statement of financial position
+----------------------------------+----------+----------------+----------------+
| | Notes | 31 December | 31 |
| | | 2008 | December |
| | | | 2007 |
+----------------------------------+----------+----------------+----------------+
| | | EUR000 | EUR000 |
+----------------------------------+----------+----------------+----------------+
| Assets | | | |
+----------------------------------+----------+----------------+----------------+
| Non-current assets | | | |
+----------------------------------+----------+----------------+----------------+
| Property Plant and Equipment | 10 | 77,670 | 67,674 |
+----------------------------------+----------+----------------+----------------+
| Goodwill | 11 | 12,559 | 12,559 |
+----------------------------------+----------+----------------+----------------+
| Other intangible assets | 11 | 1,766 | 833 |
+----------------------------------+----------+----------------+----------------+
| Other long-term assets | 12 | 80 | 76 |
+----------------------------------+----------+----------------+----------------+
| Investment in subsidiaries | | - | - |
+----------------------------------+----------+----------------+----------------+
| | | ----------- | ----------- |
+----------------------------------+----------+----------------+----------------+
| Total non current assets | | 92,075 | 81,142 |
+----------------------------------+----------+----------------+----------------+
| | | ----------- | ---------- |
+----------------------------------+----------+----------------+----------------+
| Current assets | | | |
+----------------------------------+----------+----------------+----------------+
| Inventories | 13 | 11,948 | 18,680 |
+----------------------------------+----------+----------------+----------------+
| Trade and other receivables | 14 | 53,105 | 58,271 |
+----------------------------------+----------+----------------+----------------+
| Cash and cash equivalents | 15 | 1,411 | 2,360 |
+----------------------------------+----------+----------------+----------------+
| | | ------------ | ------------ |
+----------------------------------+----------+----------------+----------------+
| Total current assets | | 66,464 | 79,311 |
+----------------------------------+----------+----------------+----------------+
| | | --------- | ------------ |
+----------------------------------+----------+----------------+----------------+
| Total assets | | 158,539 | 160,453 |
+----------------------------------+----------+----------------+----------------+
| | | ------------ | ------------ |
+----------------------------------+----------+----------------+----------------+
| Share capital | | (3,981) | (3,278) |
+----------------------------------+----------+----------------+----------------+
| Share premium | | (33,641) | (29,950) |
+----------------------------------+----------+----------------+----------------+
| Capital reserves | | (9,981) | (8,903) |
+----------------------------------+----------+----------------+----------------+
| Currency translation adjustments | | 950 | 1,661 |
+----------------------------------+----------+----------------+----------------+
| Retained earnings | | (8,163) | (6,375) |
+----------------------------------+----------+----------------+----------------+
| | | ------------ | ------------ |
+----------------------------------+----------+----------------+----------------+
| Total equity | | (54,816) | (46,845) |
+----------------------------------+----------+----------------+----------------+
| | | | |
| Non current liabilities | | | |
+----------------------------------+----------+----------------+----------------+
| Long-term borrowings | 16 | (26,129) | (26,778) |
+----------------------------------+----------+----------------+----------------+
| Long-term liabilities due to | | - | (3,000) |
| related parties | | | |
+----------------------------------+----------+----------------+----------------+
| Employee benefits | | (115) | (84) |
+----------------------------------+----------+----------------+----------------+
| Deferred tax liabilities | 20 | (2,590) | (1,706) |
+----------------------------------+----------+----------------+----------------+
| | | ------------- | --------- |
+----------------------------------+----------+----------------+----------------+
| Total non current liabilities | | (28,834) | (31,568) |
+----------------------------------+----------+----------------+----------------+
| | | | |
| Current liabilities | | | |
+----------------------------------+----------+----------------+----------------+
| Trade and other payables | 17 | (26,915) | (39,193) |
+----------------------------------+----------+----------------+----------------+
| Short-term borrowings | 16 | (47,016) | (42,424) |
+----------------------------------+----------+----------------+----------------+
| Current tax payable | | (958) | (423) |
+----------------------------------+----------+----------------+----------------+
| | | ------------- | ------------- |
+----------------------------------+----------+----------------+----------------+
| Total current liabilities | | (74,889) | (82,040) |
+----------------------------------+----------+----------------+----------------+
| | | ------------- | -------------- |
+----------------------------------+----------+----------------+----------------+
| Total liabilities | | (103,723) | (113,608) |
+----------------------------------+----------+----------------+----------------+
| | | -------------- | -------------- |
+----------------------------------+----------+----------------+----------------+
| Total liabilities and equity | | (158,539) | (160,453) |
+----------------------------------+----------+----------------+----------------+
| | | ------------- | ------------- |
+----------------------------------+----------+----------------+----------------+
Statement of changes in shareholders' equity
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| | Share | Share | Capital | Currency | Retained | Total |
| | capital | premium | reserves | translation | earnings | |
| | | | | adjustments | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| EUR 000 | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Balances, as at | 3,278 | 29,950 | 6,202 | (307) | 2,861 | 41,984 |
| 31 December 2007 | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Total comprehensive income | - | - | - | (1,354) | 6,609 | 5,255 |
| for the year | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Transferred to capital | - | - | 2,701 | - | (2,701) | - |
| reserves | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Dividends paid | - | - | - | - | (394) | (394) |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Balances, as at | 3,278 | 29,950 | 8,903 | (1,661) | 6,375 | 46,845 |
| 31 December 2008 | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Balances, as at | 3,278 | 29,950 | 8,903 | (1,661) | 6,375 | 46,845 |
| 31 December 2008 | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Total comprehensive income | - | - | - | 712 | 2,866 | 3,578 |
| for the year | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| New shares issued | 703 | 3,691 | - | - | - | 4,394 |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Transferred to capital | - | - | 1,078 | - | (1,078) | |
| issued | | | | | | - |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Balances, as at | 3,981 | 33,641 | 9,981 | (950) | 8,163 | 54,816 |
| 31 December 2009 | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Balances, as at | 3,278 | 29,950 | 6,202 | (307) | 2,861 | 41,984 |
| 31 December 2007 | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Total comprehensive income | - | - | - | (1,354) | 6,609 | 5,255 |
| for the year | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| Transferred to capital | - | - | 2,701 | - | (2,701) | - |
| reserves | | | | | | |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- |
+----------------------------+-----------+-----------+-----------+-------------------+-----------+-----------+
Statement of cash flows
+----------------------------------------+---------------+------------+
| | 31 | 31 |
| | December | December |
| | 2009 | 2008 |
+----------------------------------------+---------------+------------+
| Cash flows related to operating | EUR000 | EUR000 |
| activities | | |
+----------------------------------------+---------------+------------+
| Profit before taxes | 4,405 | 7,282 |
+----------------------------------------+---------------+------------+
| Adjustments in respect of non-cash | - | |
| transactions: | | |
+----------------------------------------+---------------+------------+
| Depreciation of fixed assets | 3,770 | 2,370 |
+----------------------------------------+---------------+------------+
| Interest expense, net | 4,530 | 4,230 |
+----------------------------------------+---------------+------------+
| Profit/loss from sale units | 52 | |
+----------------------------------------+---------------+------------+
| Employee retirement benefits | 31 | - |
+----------------------------------------+---------------+------------+
| Other adjustments | 645 | (403) |
+----------------------------------------+---------------+------------+
| | --------- | --------- |
+----------------------------------------+---------------+------------+
| | 13,433 | 13,479 |
+----------------------------------------+---------------+------------+
| Decrease (increase) in inventories | 6,733 | (6,539) |
+----------------------------------------+---------------+------------+
| Decrease (increase) in receivables | (2,580) | (8,291) |
+----------------------------------------+---------------+------------+
| Increase (decrease) in payables | (11,647) | 12,123 |
+----------------------------------------+---------------+------------+
| | ------------ | --------- |
+----------------------------------------+---------------+------------+
| | 5,939 | 10,772 |
+----------------------------------------+---------------+------------+
| Interest received (paid) | (4,596) | (3,369) |
+----------------------------------------+---------------+------------+
| Income taxes paid | (939) | (399) |
+----------------------------------------+---------------+------------+
| | ---------- | --------- |
+----------------------------------------+---------------+------------+
| Net operating cash inflows (outflows) | 404 | 7,004 |
+----------------------------------------+---------------+------------+
| | --------- | --------- |
+----------------------------------------+---------------+------------+
| Cash flows related to investing | | |
| activities | | |
+----------------------------------------+---------------+------------+
| Acquisition of tangible fixed assets | (17,640) | (44,734) |
+----------------------------------------+---------------+------------+
| Disposal of tangible fixed assets | 348 | 130 |
+----------------------------------------+---------------+------------+
| Investment grants received | 7,987 | 5,663 |
+----------------------------------------+---------------+------------+
| Acquisition of intangible fixed assets | (480) | (575) |
+----------------------------------------+---------------+------------+
| Interest received | 66 | 169 |
+----------------------------------------+---------------+------------+
| Acquisition of subsidiaries net of | - | (757) |
| cash acquired | | |
+----------------------------------------+---------------+------------+
| | ------------- | ---------- |
+----------------------------------------+---------------+------------+
| Net investment cash inflows (outflows) | (9,719) | (40,104) |
+----------------------------------------+---------------+------------+
| | ------------- | ---------- |
+----------------------------------------+---------------+------------+
| Cash flows related to financing | | |
| activities | | |
+----------------------------------------+---------------+------------+
| Dividends paid | - | (394) |
+----------------------------------------+---------------+------------+
| Proceeds of new shares issued | 4,395 | - |
+----------------------------------------+---------------+------------+
| Loans contracted (repaid) | 3,942 | 25,860 |
+----------------------------------------+---------------+------------+
| Finance lease payments | - | (96) |
+----------------------------------------+---------------+------------+
| Loan repaid by (granted to) Helesi AE | - | - |
+----------------------------------------+---------------+------------+
| | --------- | --------- |
+----------------------------------------+---------------+------------+
| Net financing cash inflows (outflows) | 8,337 | 25,370 |
+----------------------------------------+---------------+------------+
| | --------- | --------- |
+----------------------------------------+---------------+------------+
| Increase (decrease) of cash balances | (978) | (7,730) |
+----------------------------------------+---------------+------------+
| Cash balances, at the beginning of the | 2,360 | 10,396 |
| period | | |
+----------------------------------------+---------------+------------+
| Effect of currency translation | 29 | (306) |
| adjustments | | |
+----------------------------------------+---------------+------------+
| | --------- | --------- |
+----------------------------------------+---------------+------------+
| Cash balances, at the end of the | 1,411 | 2,360 |
| period | | |
+----------------------------------------+---------------+------------+
| | --------- | --------- |
+----------------------------------------+---------------+------------+
Independent Auditor's Report
To the Members of Helesi PLC
Report on the Financial Statements and the Consolidated Financial Statements
We have audited the accompanying financial statements and the consolidated
financial statements of Helesi PLC (the "Company") and its subsidiaries ('the
Group') on pages 9 to 43, which comprise the statement of financial position and
the consolidated statement of financial position of the Company and the Group as
at 31 December 2009, and the respective statements of comprehensive income,
changes in equity and cash flows for the year then ended, and a summary of
significant accounting policies and other explanatory notes.
Board of Directors' Responsibility for the Financial Statements and the
Consolidated Financial Statements
The Board of Directors is responsible for the preparation of financial
statements and consolidated financial statements that give a true and fair view
in accordance with International Financial Reporting Standards as adopted by the
European Union (EU) and the requirements of the Cyprus Companies Law, Cap. 113.
This responsibility includes: designing, implementing and maintaining internal
control relevant to the preparation and fair presentation of financial
statements and consolidated financial statements that are free from material
misstatement, whether due to fraud or error; selecting and applying appropriate
accounting policies; and making accounting estimates that are reasonable in the
circumstances.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial statements and
consolidated financial statements based on our audit. We conducted our audit in
accordance with International Standards on Auditing. Those Standards require
that we comply with ethical requirements and plan and perform the audit to
obtain reasonable assurance whether the financial statements and consolidated
financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the
amounts and disclosures in the financial statements and the consolidated
financial statements. The procedures selected depend on the auditor's judgment,
including the assessment of the risks of material misstatement of the financial
statements and the consolidated financial statements, whether due to fraud or
error. In making those risk assessments, the auditor considers internal control
relevant to the entity's preparation of financial statements and consolidated
financial statements that give a true and fair view in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the entity's internal control. An
audit also includes evaluating the appropriateness of accounting policies used
and the reasonableness of accounting estimates made by the Board of Directors as
well as evaluating the overall presentation of the financial statements and the
consolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements and the consolidated financial
statements give a true and fair view of the financial position of Helesi PLC and
its subsidiaries as at 31 December 2009, and of its financial performance and
their cash flows for the year then ended in accordance with International
Financial Reporting Standards as adopted by the EU and the requirements of the
Cyprus Companies Law, Cap. 113.
Emphasis of Matter
Without qualifying our opinion, we draw attention to note 23 to the consolidated
financial statements which indicates that the Group's net current liabilities
exceed its net current assets by EUR8.4 million. The Group's ability to continue
as a going concern is dependent upon the Group successfully rescheduling part of
its short term bank obligations.
Report on Other Legal and Regulatory Requirements
Pursuant to the requirements of the Cyprus Companies Law, Cap. 113, we report
the following:
· We have obtained all the information and explanations we
considered necessary for the purposes of our audit.
· In our opinion, proper books of account have been kept by the
Company.
· The Company's financial statements and consolidated financial
statements are in agreement with the books of account.
· In our opinion and to the best of our information and according to
the explanations given to us, the financial statements and consolidated
financial statements give the information required by the Cyprus Companies Law,
Cap. 113, in the manner so required.
· In our opinion, the information given in the report of the Board
of Directors on page XX is consistent with the financial statements and the
consolidated financial statements.
Pursuant to the requirements of the Directive DI190-2007-04 of the Cyprus
Securities and Exchange Commission, we report that a corporate governance
statement has been made for the information relating to paragraphs (a), (b),
(c), (f) and (g) of article 5 of the said Directive, and it forms a special part
of the Report of the Board of Directors.
Other Matter
This report, including the opinion, has been prepared for and only for the
Company's members as a body in accordance with Section 156 of the Cyprus
Companies Law, Cap.113 and for no other purpose. We do not, in giving this
opinion, accept or assume responsibility for any other purpose or to any other
person to whose knowledge this report may come to.
+----------------------------------+----------------------------------+
| BDO Ltd | |
+----------------------------------+----------------------------------+
| Certified Public Accountants | |
| (CY) and Registered Auditors | |
+----------------------------------+----------------------------------+
| | |
| Nicosia, 20 April 2010 | |
+----------------------------------+----------------------------------+
Notes to the financial statements
1. Basis of preparation
The financial statements have been compiled on the basis of the International
Financial Reporting Standards (IFRS) that have been adopted by the European
Union. The financial statements have been compiled on the basis of historical
cost and the amounts reported therein are stated in Euro thousand.
2. Sales revenue
+--------------------------------------------+------------+-----------+
| | 2009 | 2008 |
+--------------------------------------------+------------+-----------+
| | EUR000 | EUR000 |
+--------------------------------------------+------------+-----------+
| Sales of plastic products | 31,623 | 38,916 |
+--------------------------------------------+------------+-----------+
| Sales of vehicles | 34,413 | 15,490 |
+--------------------------------------------+------------+-----------+
| Fees for services rendered | 7,962 | 11,397 |
+--------------------------------------------+------------+-----------+
| | --------- | --------- |
+--------------------------------------------+------------+-----------+
| | 73,998 | 65,803 |
+--------------------------------------------+------------+-----------+
| | --------- | --------- |
+--------------------------------------------+------------+-----------+
3. Other revenue
+-------------------------------------------+-----------+-----------+
| | 2009 | 2008 |
+-------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+-------------------------------------------+-----------+-----------+
| Government grants | 417 | 388 |
+-------------------------------------------+-----------+-----------+
| Recharging of transportation costs | 169 | 156 |
+-------------------------------------------+-----------+-----------+
| Gain from disposal of tangible assets | 172 | 260 |
+-------------------------------------------+-----------+-----------+
| Other revenues | 470 | 257 |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
| | 1,228 | 1,061 |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
4. Persons employed and related costs
+-------------------------------------------+-----------+-----------+
| | 31 | 31 |
| | December | December |
| | 2009 | 2008 |
+-------------------------------------------+-----------+-----------+
| | Number | Number |
+-------------------------------------------+-----------+-----------+
| | | |
+-------------------------------------------+-----------+-----------+
| Number of persons employed (at year end) | 348 | 298 |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
| | | |
+-------------------------------------------+-----------+-----------+
| | 2009 | 2008 |
+-------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+-------------------------------------------+-----------+-----------+
| Salaries and wages | (6,658) | (5,106) |
+-------------------------------------------+-----------+-----------+
| Social insurance costs | (1,624) | (1,294) |
+-------------------------------------------+-----------+-----------+
| Other personnel costs | (76) | (73) |
+-------------------------------------------+-----------+-----------+
| Employment termination benefits | (30) | (26) |
+-------------------------------------------+-----------+-----------+
| Payroll costs capitalised | 638 | 252 |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
| | (7,750) | (6,247) |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
| Cost per employee (in Euro) | 22,270 | 21,809 |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
5. Analysis of depreciation charges
+-------------------------------------------+-----------+-----------+
| | 2009 | 2008 |
+-------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+-------------------------------------------+-----------+-----------+
| | | |
+-------------------------------------------+-----------+-----------+
| Buildings and building installations | (355) | (218) |
+-------------------------------------------+-----------+-----------+
| Plant and machinery | (2,477) | (1,409) |
+-------------------------------------------+-----------+-----------+
| Vehicles | (647) | (633) |
+-------------------------------------------+-----------+-----------+
| Furniture and other equipment | (140) | (100) |
+-------------------------------------------+-----------+-----------+
| Computer software | (151) | (34) |
+-------------------------------------------+-----------+-----------+
| Depreciation charges recapitalised | - | 20 |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
| | (3,770) | (2,374) |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
6. Cost of financing
+--------------------------------------------+------------+-----------+
| | 2009 | 2008 |
+--------------------------------------------+------------+-----------+
| | EUR000 | EUR000 |
+--------------------------------------------+------------+-----------+
| | | |
+--------------------------------------------+------------+-----------+
| Interest charges on bank loans | (3,647) | (2,888) |
+--------------------------------------------+------------+-----------+
| Finance lease charges | | (3) |
+--------------------------------------------+------------+-----------+
| Cost of letters of credit, letters of | (949) | (478) |
| guarantee and | | |
| similar instruments | | |
+--------------------------------------------+------------+-----------+
| | --------- | --------- |
+--------------------------------------------+------------+-----------+
| | (4,596) | (3,369) |
+--------------------------------------------+------------+-----------+
| Interest income | 66 | 169 |
+--------------------------------------------+------------+-----------+
| | --------- | --------- |
+--------------------------------------------+------------+-----------+
| Net financing costs | (4,530) | (3,200) |
+--------------------------------------------+------------+-----------+
| | --------- | --------- |
+--------------------------------------------+------------+-----------+
7. Income taxes
+-------------------------------------------+-----------+-----------+
| | 2009 | 2008 |
+-------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+-------------------------------------------+-----------+-----------+
| | | |
+-------------------------------------------+-----------+-----------+
| Profit (loss), before taxes, per the | 4,405 | 7,282 |
| statement of earnings | | |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
| Income taxes, at the nominal tax rate | (1,055) | (1,785) |
+-------------------------------------------+-----------+-----------+
| Taxes on permanent differences between | (166) | (366) |
| accounting and taxable profits | | |
+-------------------------------------------+-----------+-----------+
| Effect of tax losses carried forward | (388) | - |
+-------------------------------------------+-----------+-----------+
| Group relief | - | 59 |
+-------------------------------------------+-----------+-----------+
| Income not subjected to taxation | 324 | 591 |
+-------------------------------------------+-----------+-----------+
| Tax relief associated with profits the | - | 422 |
| taxation of which is indefinitely | | |
| deferred | | |
+-------------------------------------------+-----------+-----------+
| Extra ordinary tax | (370) | |
+-------------------------------------------+-----------+-----------+
| Tax relief (Charge) due to the reduction | 116 | 410 |
| (increase) of the tax rate | | |
+-------------------------------------------+-----------+-----------+
| Adjustments in prior year expenses | - | (4) |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
| Total tax charge | (1,539) | (673) |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
| Current tax charge | (662) | (369) |
+-------------------------------------------+-----------+-----------+
| Deferred tax charge | (877) | (304) |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
| Total tax charge | (1,539) | (673) |
+-------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------+-----------+-----------+
[The fact that, in certain cases, revenues and expenses are recognised for
accounting purposes in a different period than the period in which these income
items are taxed or expense items provide tax relief, requires the recognition of
deferred tax assets and liabilities.
The nominal tax rate applicable to Helesi PLC is 10%. However, the dividends
payable to natural persons, who are tax residents of Cyprus, are subject to a
withholding tax of 15%.
The tax relief that is associated with profits that are not taxed or are taxed
at reduced rates primarily emanates from the profits derived from the Greek
activities of the Helesi PLC Group. In Greece, the taxation of certain forms of
income may be deferred indefinitely, provided that the said income is
transferred to reserves and its distribution is, likewise, deferred.
This year, Greek authorities levied by Law 3808/2009
to impose an income tax resembling charge,
called
Social Responsibility Contribution applicable to all large Greek enterprises
whose profits exceed EUR5 million. For this reason, the Greek company was levied
with an amount of about EUR370.000 from this special tax
assessment.
However, given that the provisions of this piece of
legislation have not been utilised by Helesi SA, it is not anticipated that the
issue will have any impact on the Helesi Group.
The tax returns of the entities forming part of the Helesi PLC Group, for
certain years, have not been examined by the tax authorities as yet. As a
consequence, it is possible that additional taxes may be assessed at the time of
such an examination. These financial statements reflect a provision in respect
of this contingent liability, based on management's best estimate of the amount
that is likely to be assessed.]
8. Segmental analysis
As from 2007, the Helesi PLC Group recognises two business segments: the
environmental products segment and the environmental services segment. The
financial results and the financial position of these two business segments are
set out below.
+------------------------------+---------------+---------------+-----------+
| | 2009 |
+------------------------------+-------------------------------------------+
| | Environmental | Environmental | Helesi |
| | products | services | PLC |
| | | | Group |
+------------------------------+---------------+---------------+-----------+
| | EUR000 | EUR000 | EUR000 |
+------------------------------+---------------+---------------+-----------+
| | | | |
+------------------------------+---------------+---------------+-----------+
| Third-party sales | 66,036 | 7,962 | 73,998 |
+------------------------------+---------------+---------------+-----------+
| Other third-party revenues | 1,138 | 90 | 1,228 |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Total revenues | 67,174 | 8,052 | 75,226 |
+------------------------------+---------------+---------------+-----------+
| Cost of Sales | (41,754) | - | (41,754) |
+------------------------------+---------------+---------------+-----------+
| Personnel-related costs | (4,485) | (3,265) | (7,750) |
+------------------------------+---------------+---------------+-----------+
| Directors' emoluments | (295) | - | (295) |
+------------------------------+---------------+---------------+-----------+
| Depreciation charges | (3,245) | (525) | (3,770) |
+------------------------------+---------------+---------------+-----------+
| Other operating expenses | (10,096) | (2,626) | (12,722) |
+------------------------------+---------------+---------------+-----------+
| Intersegment expenses | | | |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Segmental profit, before | 7,299 | 1,636 | 8,935 |
| finance charges | | | |
+------------------------------+---------------+---------------+-----------+
| Cost of financing | (4,043) | (487) | (4,530) |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Segmental profit, before | 3,256 | 1,149 | 4,405 |
| taxes | | | |
+------------------------------+---------------+---------------+-----------+
| Elimination of | | | |
| intersegmental profits | | | |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Profit from ordinary | 3,256 | 1,149 | 4,405 |
| activities | | | |
+------------------------------+---------------+---------------+-----------+
| Income taxes | (1,137) | (402) | (1,539) |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Net profit, after taxes | 2,119 | 747 | 2,866 |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
+------------------------------+---------------+---------------+-----------+
| | 2008 |
+------------------------------+-------------------------------------------+
| | Environmental | Environmental | Helesi |
| | products | services | PLC |
| | | | Group |
+------------------------------+---------------+---------------+-----------+
| | EUR000 | EUR000 | EUR000 |
+------------------------------+---------------+---------------+-----------+
| | | | |
+------------------------------+---------------+---------------+-----------+
| Third-party sales | 54,406 | 11,397 | 65,803 |
+------------------------------+---------------+---------------+-----------+
| Other third-party revenues | 1,061 | - | 1,061 |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Total revenues | 55,467 | 11,397 | 66,864 |
+------------------------------+---------------+---------------+-----------+
| Cost of materials used | (32,810) | (1,800) | (34,610) |
+------------------------------+---------------+---------------+-----------+
| Personnel-related costs | (3,926) | (2,321) | (6,247) |
+------------------------------+---------------+---------------+-----------+
| Directors' emoluments | (305) | - | (305) |
+------------------------------+---------------+---------------+-----------+
| Depreciation charges | (2,031) | (343) | (2,374) |
+------------------------------+---------------+---------------+-----------+
| Other operating expenses | (9,263) | (3,583) | (12,846) |
+------------------------------+---------------+---------------+-----------+
| Intersegment expenses | 620 | (620) | - |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Segmental profit, before | 7,752 | 2,730 | 10,482 |
| finance charges | | | |
+------------------------------+---------------+---------------+-----------+
| Cost of financing | (2,795) | (405) | (3,200) |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Segmental profit, before | 4,957 | 2,325 | 7,282 |
| taxes | | | |
+------------------------------+---------------+---------------+-----------+
| Elimination of | - | - | - |
| intersegmental profits | | | |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Profit from ordinary | 4,957 | 2,325 | 7,282 |
| activities | | | |
+------------------------------+---------------+---------------+-----------+
| Income taxes | (458) | (215) | (673) |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
| Net profit, after taxes | 4,499 | 2,110 | 6,609 |
+------------------------------+---------------+---------------+-----------+
| | --------- | --------- | --------- |
+------------------------------+---------------+---------------+-----------+
The third-party sales and the value of the related trade receivables outstanding
at each year end, on the basis of the location at which the customers operate
(inclusive of the balances that are doubtful of collection and have been
provided for), is analysed as follows:
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| | Greece | United | Italy | Other | Other | Helesi |
| | | Kingdom | | EU | (non-EU) | PLC |
| | | | | states | states | Group |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| | EUR000 | EUR000 | EUR000 | | EUR000 | EUR000 |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| 2009 | | | | | | |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| Value of sales | 45,966 | 7,061 | 8,483 | 9,032 | 3,456 | 73,998 |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| Trade receivables, | 30,122 | 1,552 | 14,184 | 6,894 | 353 | 53,105 |
| at year end | | | | | | |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| 2008 | | | | | | |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| Value of sales | 28,921 | 6,308 | 4,697 | 22,855 | 3,022 | 65,803 |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| Trade receivables, | 37,846 | 1,873 | 10,376 | 7,216 | 960 | 58,271 |
| at year end | | | | | | |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- |
+----------------------+-----------+-----------+-----------+-----------+-----------+-----------+
9. Interest in joint ventures
In the year 2007, Helesi SA acquired the 70% of the joint venture in Cyprus with
the purpose of construction and operation of two transhipment stations in SW
Cyprus. In the beginning of 2008, the company purchased the other 30% for an
amount of EUR700,000 . These two separate stages of the project, construction and
operation, have been recognised at their fair value. The construction stage is
in progress and 75% is estimated to have been completed on 31 December. Income
and expenses related to the construction stage have been recognised in the
present financial statements by the percentage mentioned above. On 31 December
2009 the total assets were EUR2,683,000 and the total liabilities were EUR2,193,000.
Additionally during 2009, Helesi SA and Mesogeios SA formed the joint-venture
Perivallontiki - Mesogeios with the purpose of waste management for West
Macedonia Perfecture. Helesi participation is 60%. Revenues for the current
financial year are EUR1,648,000 and net profit after tax was EUR26,000. On 31
December 2009 total assets were EUR5,000 and total liabilities were EUR127,000. The
JV has been proportionally consolidated in the Group statements.
10. Tangible fixed assets
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| The Group | Land | Buildings | Plant | Vehicles | Furniture | Assets | Total |
| | | and | and | | and other | under | |
| | | building | machinery | | equipment | construction | |
| | | installations | | | | or | |
| | | | | | | installation | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | EUR000 | EUR000 | EUR000 | EUR000 | EUR000 | EUR000 | EUR000 |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| At cost or | | | | | | | |
| valuation | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| As at 31 December | 2,987 | 8,867 | 23,820 | 2,611 | 434 | 23,462 | 62,181 |
| 2007 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Effect of currency | | | (716) | (10) | (4) | | (730) |
| translation | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Additions 2008 | - | 418 | 2,714 | 580 | 456 | 7,489 | 11,657 |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Acquisitions | 74 | 9 | 57 | 1,948 | 53 | - | 2,141 |
| through business | | | | | | | |
| combinations | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Capitalised | - | - | - | - | - | 1,030 | 1,030 |
| interest charges | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Disposals 2008 | (147) | (9) | (123) | (2) | | | (281) |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Transfers | - | - | 2 | (1) | (1) | - | - |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- | --------- |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| As at 31 December | 2,914 | 9,285 | 25,754 | 5,126 | 938 | 31,981 | 75,998 |
| 2008 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- | --------- |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| As at 31 December | 2,914 | 9,285 | 25,754 | 5,126 | 938 | 31,981 | 75,998 |
| 2008 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- | --------- |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Effect of currency | | | 150 | 2 | (65) | | 87 |
| translation | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Additions 2009 | | 7,960 | 11,287 | 124 | 383 | (4,941) | 14,813 |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Disposals 2009 | (88) | (5) | (261) | (357) | (5) | - | (716) |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Transfers | (217) | 3,747 | 19,957 | 23 | (22) | (24,345) | (856) |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- | --------- |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | 2,609 | 20,987 | 56,887 | 4,918 | 1,229 | 2,695 | 89,326 |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Accumulated | | | | | | | |
| depreciation | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| As at 31 December | - | (845) | (3,667) | (1,020) | (161) | - | (5,693) |
| 2007 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Effect of currency | - | 1 | 202 | 9 | 3 | - | 215 |
| translation | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Depreciation charge | - | (218) | (1,409) | (633) | (100) | - | (2,360) |
| 2008 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Disposals 2008 | - | - | 25 | 2 | - | - | 27 |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Acquisitions | - | - | (21) | (452) | (40) | - | (513) |
| through business | | | | | | | |
| combinations | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- | --------- |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| As at 31 December | - | (1,062) | (4,870) | (2,094) | (298) | - | (8,324) |
| 2008 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- | --------- |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Effect of currency | - | - | (38) | - | 9 | - | (29) |
| translation | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Depreciation | - | (355) | (2,477) | (647) | (140) | | (3,619) |
| charges 2009 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Disposals 2009 | - | | 47 | 268 | 1 | - | 316 |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- | --------- |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| As at 31 December | - | (1,417) | (7,338) | (2,473) | (428) | - | (11,656) |
| 2009 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- | --------- |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| Net book values | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| As at 31 December | 2,609 | 19,570 | 49,549 | 2,445 | 801 | 2,695 | 77,670 |
| 2009 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| As at 31 December | 2,914 | 8,223 | 20,884 | 3,032 | 640 | 31,981 | 67,674 |
| 2008 | | | | | | | |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
| | --------- | --------- | --------- | --------- | --------- | --------- | --------- |
+---------------------+-----------+---------------+-----------+------------------+-----------+--------------+-----------+
The assets under construction or installation refer to work in progress at the
Komotini plant due for completion in 2010.
The cost of the acquisition of tangible fixed assets is reported net of the
grants received for partly financing their purchase. The full purchase cost of
these assets and the related grants that have been utilised to partially finance
their acquisition is reflected in the following table:
+---------------------------------------+----------------+------------+------------------+
| The Group | Full | Investment | Reported |
| | purchase | grants | acquisition |
| | cost | | costs |
+---------------------------------------+----------------+------------+------------------+
| | EUR000 | EUR000 | EUR000 |
+---------------------------------------+----------------+------------+------------------+
| 2009 | | | |
+---------------------------------------+----------------+------------+------------------+
| Land | 2,609 | - | 2,609 |
+---------------------------------------+----------------+------------+------------------+
| Buildings and building installations | 30,815 | (9,828) | 20,987 |
+---------------------------------------+----------------+------------+------------------+
| Plant and machinery | 97,208 | (40,321) | 56,887 |
+---------------------------------------+----------------+------------+------------------+
| Vehicles | 5,915 | (997) | 4,918 |
+---------------------------------------+----------------+------------+------------------+
| Furniture and other equipment | 1,645 | (416) | 1,229 |
+---------------------------------------+----------------+------------+------------------+
| Assets under construction | 2,695 | - | 2,695 |
+---------------------------------------+----------------+------------+------------------+
| | --------- | --------- | --------- |
+---------------------------------------+----------------+------------+------------------+
| | 140,887 | (51,562) | 89,325 |
+---------------------------------------+----------------+------------+------------------+
| | --------- | --------- | --------- |
+---------------------------------------+----------------+------------+------------------+
| 2008 | | | |
+---------------------------------------+----------------+------------+------------------+
| Land | 2,914 | - | 2,914 |
+---------------------------------------+----------------+------------+------------------+
| Buildings and building installations | 12,084 | (2,799) | 9,285 |
+---------------------------------------+----------------+------------+------------------+
| Plant and machinery | 40,917 | (15,163) | 25,754 |
+---------------------------------------+----------------+------------+------------------+
| Vehicles | 6,123 | (997) | 5,126 |
+---------------------------------------+----------------+------------+------------------+
| Furniture and other equipment | 1,172 | (234) | 938 |
+---------------------------------------+----------------+------------+------------------+
| Assets under construction | 65,228 | (33,247) | 31,981 |
+---------------------------------------+----------------+------------+------------------+
| | --------- | --------- | --------- |
+---------------------------------------+----------------+------------+------------------+
| | 128,438 | (52,440) | 75,998 |
+---------------------------------------+----------------+------------+------------------+
| | --------- | --------- | --------- |
+---------------------------------------+----------------+------------+------------------+
In 2009, the development costs that have satisfied the capitalisation criteria
set, amounted to EUR761,000 while for 2008 it was EUR129,000. These costs comprised
(in EUR'000):
+-------------------------------------------------------+-----------+-----------+
| | 2009 | 2008 |
+-------------------------------------------------------+-----------+-----------+
| Personnel related costs | 638 | 56 |
+-------------------------------------------------------+-----------+-----------+
| Depreciation charges | - | 20 |
+-------------------------------------------------------+-----------+-----------+
| Miscellaneous other expenses | 123 | 53 |
+-------------------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------------------+-----------+-----------+
| | 761 | 129 |
+-------------------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-------------------------------------------------------+-----------+-----------+
As at 31 December 2009 and 2008, there were mortgages and other charges on the
property of the Helesi PLC Group, as a form of security for the financing
facilities placed at the disposal of the Helesi PLC Group and for guarantees
given in favour of the Helesi PLC Group, which amounted, in aggregate, to EUR33
million and EUR23 million, respectively. In the course of 2009, new charges of
EUR10 million were added.
11. Intangible fixed assets
The intangible fixed assets of the Helesi PLC Group entirely comprise goodwill
of EUR12,559,000 (2008: EUR12,559,000) and computer software of EUR1,766,000 (2008:
EUR833,000).
The carrying value of EUR12,5 million of goodwill which arose on the acquisition
of the vehicles division is assessed annually for impairment.
12. Other long-term assets
Other long-term assets primarily comprise guarantee deposits given in relation
to operating leases.
13. Inventories
+------------------------------------------------+-----------+-----------+
| | 31 | 31 |
| | December | December |
| | 2009 | 2008 |
+------------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+------------------------------------------------+-----------+-----------+
| Vehicles | 1,974 | 9,306 |
+------------------------------------------------+-----------+-----------+
| Manufactured goods | 4,832 | 2,162 |
+------------------------------------------------+-----------+-----------+
| Raw and packaging materials | 5,142 | 7,212 |
+------------------------------------------------+-----------+-----------+
| | --------- | --------- |
+------------------------------------------------+-----------+-----------+
| | 11,948 | 18,680 |
+------------------------------------------------+-----------+-----------+
| | --------- | --------- |
+------------------------------------------------+-----------+-----------+
14. Receivables
+------------------------------------------------+-----------+-----------+
| | 31 | 31 |
| | December | December |
| | 2009 | 2008 |
+------------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+------------------------------------------------+-----------+-----------+
| Trade receivables | 33,366 | 29,258 |
+------------------------------------------------+-----------+-----------+
| Receivables doubtful of collection | (1,114) | (955) |
+------------------------------------------------+-----------+-----------+
| | --------- | --------- |
+------------------------------------------------+-----------+-----------+
| | 32,252 | 28,303 |
+------------------------------------------------+-----------+-----------+
| Advances to suppliers | 3,370 | 436 |
+------------------------------------------------+-----------+-----------+
| State receivables (including VAT,grants and | 13,419 | 24,500 |
| refundable taxes) | | |
+------------------------------------------------+-----------+-----------+
| Blocked deposit accounts | - | 309 |
+------------------------------------------------+-----------+-----------+
| Other receivables | 4,064 | 4,723 |
+------------------------------------------------+-----------+-----------+
| | --------- | --------- |
+------------------------------------------------+-----------+-----------+
| | 53,105 | 58,271 |
+------------------------------------------------+-----------+-----------+
| | --------- | --------- |
+------------------------------------------------+-----------+-----------+
The provision for bad debts was increased by EUR336,000 (2008: EUR100,000) out of
which EUR177,000 were utilized. The past due receivables that have not been
impaired amount to EUR6.5 million and are past due 3 months more or less from the
contractual maturity. Management considers that these receivables will be
collected in full.
The ageing analysis of trade receivables is as follows:
+-------------------------------------------------------+------------------+---------------+
| | 31 December 2009 | 31 |
| | | December 2008 |
+-------------------------------------------------------+------------------+---------------+
| Period | | |
+-------------------------------------------------------+------------------+---------------+
| Up to 6 months | 20,950 | 21,301 |
+-------------------------------------------------------+------------------+---------------+
| 6 to 9 months | 5,769 | 2,642 |
+-------------------------------------------------------+------------------+---------------+
| 9 to 12 months | 753 | 652 |
+-------------------------------------------------------+------------------+---------------+
| Over 12 months | 5,780 | 3,708 |
+-------------------------------------------------------+------------------+---------------+
| | --------- | --------- |
+-------------------------------------------------------+------------------+---------------+
| | 32,252 | 28,303 |
+-------------------------------------------------------+------------------+---------------+
| | --------- | --------- |
+-------------------------------------------------------+------------------+---------------+
15. Cash and cash equivalents
Cash and cash equivalents comprise notes held by the Helesi PLC Group as well as
bank deposits available on demand.
16. Borrowings
The loans contracted by the Helesi PLC Group have been advanced by Greek banks
and are denominated in Euros. The amounts that are repayable within one year of
the balance sheet date are reported as short-term liabilities while the amounts
that are repayable at a subsequent stage are reported as long-term obligations.
The loans of the Helesi PLC Group are analysed as follows:
+---------------------------------------------+-----------+------------+
| | 31 | 31 |
| | December | December |
| | 2009 | 2008 |
+---------------------------------------------+-----------+------------+
| | EUR000 | EUR000 |
+---------------------------------------------+-----------+------------+
| | | |
+---------------------------------------------+-----------+------------+
| Short-term borrowings | | |
+---------------------------------------------+-----------+------------+
| Bank loans | (41,362) | (40,455) |
+---------------------------------------------+-----------+------------+
| Short-term portion of long-term loans | (5,646) | (1,969) |
+---------------------------------------------+-----------+------------+
| Finance lease obligations | (8) | - |
+---------------------------------------------+-----------+------------+
| | --------- | --------- |
+---------------------------------------------+-----------+------------+
| | (47,016) | (42,424) |
+---------------------------------------------+-----------+------------+
| | --------- | --------- |
+---------------------------------------------+-----------+------------+
| Long-term borrowings | | |
+---------------------------------------------+-----------+------------+
| Debenture loan | (26,115) | (26,778) |
+---------------------------------------------+-----------+------------+
| Finance lease obligations | (14) | - |
+---------------------------------------------+-----------+------------+
| | --------- | --------- |
+---------------------------------------------+-----------+------------+
| | (26,129) | (26,778) |
+---------------------------------------------+-----------+------------+
| | --------- | --------- |
+---------------------------------------------+-----------+------------+
Depending on the date of maturity, long-term borrowings are analysed as follows:
+-------------------------------------------------------+-----------+----------+-----------+
| | 31 | 31 December |
| | December | 2008 |
| | 2009 | |
+-------------------------------------------------------+-----------+----------------------+
| | EUR000 | EUR000 |
+-------------------------------------------------------+-----------+----------------------+
| | | |
+-------------------------------------------------------+----------------------+-----------+
| Long-term borrowing repayable in: | | |
+-------------------------------------------------------+----------------------+-----------+
| 1 to 2 years | (6,295) | (4,537) |
+-------------------------------------------------------+----------------------+-----------+
| 2 to 5 years | (14,372) | (8,686) |
+-------------------------------------------------------+----------------------+-----------+
| Over 5 years | (5,462) | (13,555) |
+-------------------------------------------------------+----------------------+-----------+
| | --------- | --------- |
+-------------------------------------------------------+----------------------+-----------+
| | (26,129) | (26,778) |
+-------------------------------------------------------+----------------------+-----------+
| | --------- | --------- |
+-------------------------------------------------------+----------------------+-----------+
| | | | |
+-------------------------------------------------------+-----------+----------+-----------+
The following are the contractual maturity of bank loans including interest
payment:
+----------------------------------------------+-----------+-----------+
| | 31 | 31 |
| | December | December |
| | 2009 | 2008 |
+----------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+----------------------------------------------+-----------+-----------+
| 1 to 2 years | (7,673) | (6,760) |
+----------------------------------------------+-----------+-----------+
| 2 to 5 years | (16,852) | (10,796) |
+----------------------------------------------+-----------+-----------+
| Over 5 years | (6,332) | (12,946) |
+----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+----------------------------------------------+-----------+-----------+
| | (30,857) | (30,502) |
+----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+----------------------------------------------+-----------+-----------+
The weighted average cost of borrowing for 2009 was 4% for 2009 due to the
historical low Euribor rate. The Greek subsidiary Helesi SA was in breach of
covenants related to a total amount of EUR9.5 million of long term debt. A waiver
has been obtained for the covenants.
17. Payables
+----------------------------------------------+-----------+-----------+
| | 31 | 31 |
| | December | December |
| | 2009 | 2008 |
+----------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+----------------------------------------------+-----------+-----------+
| Trade creditors | (24,630) | (34,207) |
+----------------------------------------------+-----------+-----------+
| Accrued expenses | (433) | (2,708) |
+----------------------------------------------+-----------+-----------+
| Social security contributions payable | (418) | (433) |
+----------------------------------------------+-----------+-----------+
| Payable salaries | (304) | (320) |
+----------------------------------------------+-----------+-----------+
| Liabilities due to related parties | - | (3,000) |
+----------------------------------------------+-----------+-----------+
| Liabilities due to subsidiaries | - | - |
+----------------------------------------------+-----------+-----------+
| Taxes (other than income tax) payable | (702) | (519) |
+----------------------------------------------+-----------+-----------+
| Other payables | (428) | (1,006) |
+----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+----------------------------------------------+-----------+-----------+
| | (26,915) | (42,193) |
+----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+----------------------------------------------+-----------+-----------+
| Long term liabilities | - | (3,000) |
+----------------------------------------------+-----------+-----------+
| Short term liabilities | (26,915) | (39,193) |
+----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+----------------------------------------------+-----------+-----------+
| | (26,915) | (42,193) |
+----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+----------------------------------------------+-----------+-----------+
18. Government grants
Government grants relate to Helesi SA and Helesi Italia srl and have been
granted in relation to investments in fixed tangible assets, effected in the
period from 2000 to 2008 or currently under construction. The reported value of
the acquired fixed tangible assets has been reduced by the grants received and
receivable for the purposes of partially financing their acquisition cost.
Depending on the provisions of the law, under which the grants were advanced,
certain restrictions apply as to the transfer of the ownership of the subsidised
assets and to changes of the legal status of the entity to which the grants were
advanced. The inspections carried out by the supervisory authorities, to date,
have not disclosed cases of non-compliance with these restrictions that had not
been approved, in advance.
The amount of government grants received and receivable, for the purposes of
financing the purchase of fixed assets, is reported under the note covering
fixed tangible assets. The resultant reduction of the depreciation charges that
would have, otherwise, burdened the operations of the Helesi PLC Group is
quantified in the following table:
+----------------------------------------------------------+-----------+
| The Group | EUR000 |
+----------------------------------------------------------+-----------+
| | |
+----------------------------------------------------------+-----------+
| Effective reduction of the value of tangible fixed | (23,415) |
| assets, as at 31 December 2007 | |
+----------------------------------------------------------+-----------+
| New grants secured in 2008 | (25,833) |
+----------------------------------------------------------+-----------+
| Effective reduction of the depreciation charges, in 2008 | 1,045 |
+----------------------------------------------------------+-----------+
| | --------- |
+----------------------------------------------------------+-----------+
| Effective reduction of the value of tangible fixed | (48,203) |
| assets, as at 31 December 2008 | |
+----------------------------------------------------------+-----------+
| New grants secured in 2009 | 800 |
+----------------------------------------------------------+-----------+
| Effective reduction of the depreciation charges, in 2009 | 1,576 |
+----------------------------------------------------------+-----------+
| | |
| | --------- |
+----------------------------------------------------------+-----------+
| Effective reduction of the value of tangible fixed | (45,827) |
| assets, as at 31 December 2009 | |
+----------------------------------------------------------+-----------+
| | --------- |
+----------------------------------------------------------+-----------+
19. Earnings per share and proposed dividends
Earnings per share are calculated by dividing the profit attributable to the
shareholders of Helesi PLC by the weighted average number of issued and
outstanding shares in the accounting period covered by the financial statements.
+----------------------------+-----------+-----------+-----------+-----------+
| | Basic EPS | Diluted EPS |
+----------------------------+-----------------------+-----------------------+
| The Group | 31 | 31 | 31 | 31 |
| | December | December | December | December |
| | 2009 | 2008 | 2009 | 2008 |
+----------------------------+-----------+-----------+-----------+-----------+
| | EUR000 | EUR000 | EUR000 | EUR000 |
+----------------------------+-----------+-----------+-----------+-----------+
| | | | | |
+----------------------------+-----------+-----------+-----------+-----------+
| Net profit attributable to | 2,866 | 6,609 | 2,866 | 6,609 |
| the shareholders (in Euro | | | | |
| thousand) | | | | |
+----------------------------+-----------+-----------+-----------+-----------+
| Weighted average number of | 37,109 | 32,775 | 37,109 | 32,775 |
| issued shares (in | | | | |
| thousands) | | | | |
+----------------------------+-----------+-----------+-----------+-----------+
| | --------- | --------- | --------- | --------- |
+----------------------------+-----------+-----------+-----------+-----------+
| Earnings per share (in EUR) | 0.08 | 0.20 | 0.08 | 0.20 |
+----------------------------+-----------+-----------+-----------+-----------+
| | --------- | --------- | --------- | --------- |
+----------------------------+-----------+-----------+-----------+-----------+
For 2009, the Board of Directors has decided not to propose dividend, taking
into account the financial environment.
20. Deferred tax assets and liabilities
Deferred tax assets and liabilities are quantified at the level of each separate
entity forming part of the Helesi PLC Group and, to the extent that deferred tax
assets and deferred tax liabilities arise, they are off set against each other.
The deferred tax assets and liabilities emanate from the following causes:
+----------------------------------------------+-----------+-----------+
| | 2009 | 2008 |
+----------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+----------------------------------------------+-----------+-----------+
| Tax impact of the differentiation of the | (2,930) | (1,858) |
| accounting and the tax depreciation rates | | |
+----------------------------------------------+-----------+-----------+
| Anticipated tax burden on the disposal of | (28) | (28) |
| revalued land | | |
+----------------------------------------------+-----------+-----------+
| Providing for doubtful receivables, while | 191 | 238 |
| tax relief entails a write-off | | |
+----------------------------------------------+-----------+-----------+
| Reducing the value of stocks to eliminate | 78 | 48 |
| the effect of tax depreciation | | |
+----------------------------------------------+-----------+-----------+
| Tax relief from taxable losses | | 61 |
+----------------------------------------------+-----------+-----------+
| Miscellaneous timing differences between | 99 | (167) |
| accounting profits and taxable income | | |
+----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+----------------------------------------------+-----------+-----------+
| Income taxes, which will burden future | (2,590) | (1,706) |
| accounting periods | | |
+----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+----------------------------------------------+-----------+-----------+
21. Commitments and contingent liabilities
The construction of one of the two waste transfer stations in Cyprus has not
proceeded according to the contract with the Cyprus government as the local
community of the original site strongly opposes its construction. In accordance
with the contract, the group is entitled to significant compensation for delays
and non-performance based upon a number of criteria. The Group is presently
negotiating the level of compensation that will be finally paid with the
appropriate authorities, but no provision has been made in these financial
statements as the final figure cannot be determined with any degree of accuracy
at the present time and will depend upon the alternative site already indicated
by the state, and the estimated time required to be able to start its
construction and operation. Income from compensation will be realised as these
uncertainties are resolved.
The Helesi PLC Group is contractually committed under operating leases for the
leasing of office space and warehouses and of certain production facilities in
the UK, as follows:
+-----------------------------------------------+-----------+-----------+
| | Within | Within |
| | 1 year | 2-5 |
| | | years |
+-----------------------------------------------+-----------+-----------+
| | EUR000 | EUR000 |
+-----------------------------------------------+-----------+-----------+
| | | |
+-----------------------------------------------+-----------+-----------+
| Office premises | 17 | 36 |
+-----------------------------------------------+-----------+-----------+
| Production facilities | - | 117 |
+-----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-----------------------------------------------+-----------+-----------+
| | 17 | 153 |
+-----------------------------------------------+-----------+-----------+
| | --------- | --------- |
+-----------------------------------------------+-----------+-----------+
The Helesi PLC Group is contractually committed under operating leases for the
leasing of office space and warehouses and of certain production facilities in
the UK, as follows:
+---------------------------------------+---------------+--------------+
| | Within 1 year | Within 2-5 |
| | | years |
+---------------------------------------+---------------+--------------+
| | EUR000 | EUR000 |
+---------------------------------------+---------------+--------------+
| | | |
+---------------------------------------+---------------+--------------+
| Office premises | 41 | 36 |
+---------------------------------------+---------------+--------------+
| Production facilities | 141 | 117 |
+---------------------------------------+---------------+--------------+
| | --------- | --------- |
+---------------------------------------+---------------+--------------+
| | 182 | 153 |
+---------------------------------------+---------------+--------------+
| | --------- | --------- |
+---------------------------------------+---------------+--------------+
The Helesi PLC Group has provided guarantees in favour of third parties EUR
12.289.
22. Post balance sheet events
Helesi Plc sold the business and some of the assets of Helesi UK Ltd, which
constitute Helesi's UK based two-wheeled bin manufacturing operations, to
Straight Plc. The consideration payable by Straight is a total of EUR1.7 million
in cash and consists of an initial payment of EUR0.9 thousand on completion with
the balance paid in 10 equal monthly instalments commencing on 30th April 2010.
The proceeds of the sale were used for the reduction of the group's short term
debt obligations.
In addition Helesi has entered into a strategic alliance with Straight in the UK
and Ireland under which Straight will pay Helesi an ongoing process fee for the
use of its brand on jointly branded products, Straight will also become the
exclusive UK and Irish distributor and licensee for other Helesi products
including plastic 4-wheeled bins. Both companies expect to work together on the
development of new products.
There are no other reportable post-balance sheets events.
23. Going Concern
The financial statements are prepared under the going concern assumption. As at
the balance sheet date, the Group's current liabilities exceed its current
assets by an amount of EUR8.4 million.
The Group projections and budget for 2010 reflect a sustainable net operating
cashflow. However Helesi relies also on its long-term relationship with domestic
banks, aiming to increase headroom and reschedule part of its short-term
obligations. Helesi's standard practise in effort to renew its short term
obligations for the following year is to provide additional comfort to banks and
collateralize a significant part of the credit lines provided. Note that the
tail of EUR11.3 million Greek and Italian State grants are still outstanding.
Their collection will instantly reduce net debt levels, and will allow banks to
provide additional headroom. Management places the collection of grants in the
second half of 2010. Nevertheless in the case of significant delays, the
management may examine the sale and lease back of certain assets.
Despite the budgetary constraints on local and foreign municipalities, the
management's view is that Helesi does not face a high collection risk and the
Group will be able to meet its liabilities. Group receivables are safeguarded
against defaults as primary customers are government bodies with the higher
level of credibility compared to the rest of the corporate world. The
consequences of a Greek sovereign default, if it were to occur, on the Greek
Banking System and the Greek economy as a whole, could adversely affect the
group's ability to meet its budget for 2010. Management believes that it is
highly unlikely to experience a Greek sovereign default since the Greek
government has applied a strict supervised programme, and the EU and IMF support
will be provided if it is necessary.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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