TIDMRMA
RNS Number : 4676B
Rasmala PLC
21 September 2018
Rasmala plc
("Rasmala" or the "Company")
Condensed Consolidated Interim Financial Statements
for the six months ended 30 June 2018
Highlights
-- Financial performance for the six months to 30 June 2018 was satisfactory
-- Operating income of GBP4.6m (H1 2017: GBP5.1m)
-- Fee income, excluding transactional real estate deals, of
GBP3.8m is up GBP1.1m year on year (H1 2017: GBP2.7m)
-- Operating expenses down 20% compared to same period last year to GBP5.1m (H1 2017: GBP6.4m)
-- Operating loss of GBP0.6m (H1 2017: GBP1.2m loss)
-- Assets under management (AUM) at 30 June 2018 including
capital seeded by the Group increased 11% to US$1,929m (December
2017: US$1,747m)
-- Strong capital and liquid balance sheet maintained
Financial results
Rasmala delivered an improved performance in the period up to 30
June 2018 from H1 2017.
Total operating income for the six months to 30 June 2018 was
GBP4.6m (H1 2017: GBP5.1m). Total expenses for the six months were
down 20% compared to the same period last year to GBP5.1m (H1 2017:
GBP6.4m). The resulting Operating loss for the six months was
GBP0.6m (H1 2017: GBP1.2m).
Our performance in the first six months is the result of
continuing confidence from our investors in our diversified product
offering and maintaining strong cost control.
Our balance sheet remains strong, both in terms of capital and
liquidity which we use to support investments made throughout the
Group.
Commentary
In the second half of 2018 there are a number of potential risks
around the world including the ongoing trade war between the US and
China, a strengthening US dollar which is negatively impacting
emerging market economies, rising inflationary pressures in
developed economies, tightening global liquidity and ongoing global
and regional geopolitical uncertainties.
Regional markets
In Q2 there were two major announcements in relation to the
Saudi Arabian equity market. The FTSE and MSCI decided to include
Saudi Arabia as part of their Emerging Market Indices with an
estimated weight of 2.7% and 2.6% respectively. This move is
expected to attract total flows of approximately US$50bn into the
Saudi market. In Kuwait, the implementation of the FTSE upgrade to
Emerging Market Status will be completed by the end of this year
and is expected to attract US$900m into the Kuwaiti market. MSCI is
expected to upgrade Kuwait in June 2019. The Dubai market has been
the worst performing market in the GCC in 2018. However, we expect
capital to flow back into Dubai as investors book profits and
unwind index related trades.
Oil price
The price of oil remains well supported by strong global demand
and the recent supply disruption. OPEC has responded to this
growing supply deficit and has pledged to increase production by
one million barrels per day. Saudi Arabia and UAE have also
announced that they are ready to utilize their idle capacity to
boost production and keep markets balanced. Rising oil prices and
output will benefit the fiscal positions of the petrodollar
economies of the Gulf who have budgeted oil prices well below
current levels. This has started to translate into higher fiscal
spending by the stronger GCC governments who are large players in
their respective economies.
Real Estate
International investors continue to view the UK and Europe as
secure investment destinations. Logistics assets are proving to be
attractive as investors move away from retail and into warehousing
and distribution assets. As the UK braces for Brexit, e-commerce
will remain the primary driver of growth in demand for logistics
space including larger fulfilment centres and "last-mile" depots,
allowing retailers to efficiently serve an expanding and more
demanding customer base. While the long-term impact of Brexit on
the UK logistics market is still unclear, the likely transition
period should provide additional time to restructure domestic and
pan-European supply chains.
US assets continue to attract Gulf investors as the region
doesn't suffer any US Dollar currency risk. Yields in the US remain
relatively stable but with the higher cost of funding, total
returns that are being achieved are lower in comparison to the UK
and Europe, but arguably with reduced risk to currency
volatility.
Investment Management
We saw significant interest during the period in our product
offerings with gross inflows of US$362m leading to net inflows of
US$182m. AUM as at 30 June 2018 including capital seeded by the
Group increased 11% to US$1,929m.
Investment performance during the period was stable with returns
from fixed income investments under pressure by rising short term
interest rates in the US, and equities benefitting from strong
global economic growth. Adding to positive sentiment in the region
was the rally in oil prices with improving regional government
fiscal positions and liquidity.
Investment Banking
In the first half of the year, our efforts were focused on
post-acquisition work related to our 2017-year end acquisitions on
behalf of our clients of three German-based real estate logistics
assets.
During the period we evaluated several new assets and prepared
three well researched bids for both commercial and logistic
properties. However, we were unsuccessful in acquiring these assets
as other investors were willing to pay prices well above our
assessment of fair value. The competition for the type of
long-income properties which have been the focus of our real estate
investment strategy for the past years has intensified making the
acquisition process that much more challenging.
Treasury and Principal Investments
Our investment in Red Apartments Limited is making progress in
driving organic growth whilst capturing cost efficiencies. We are
currently exploring the possibility of launching a fund to acquire
new properties primarily in London and the South East.
Our balance sheet remains strong, both in terms of capital and
liquidity which we use to support investments made throughout the
Group.
Outlook
We remain optimistic as we continue to work closely with our
clients to identify and deliver on investment opportunities.
Enquiries:
Rasmala plc Tel: +44 (0)20 7847 9900
---------------------------- -------------------------
Zak Hydari, CEO
---------------------------- -------------------------
Stockdale Securities Tel: +44 (0)20 7601 6100
---------------------------- -------------------------
Antonio Bossi, David Coaten
---------------------------- -------------------------
Rasmala plc
Condensed consolidated statement of income
For the six months ended 30 June 2018 (unaudited)
Year to
6 months to 30-Jun-18 6 months to 30-Jun-17 31-Dec-17
GBP'000 GBP'000 GBP'000
--------------------------------------------------------- ---------------------- ---------------------- -----------
Income
Income from financing and investing activities 45 559 558
Finance costs (220) (178) (335)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Net margin (175) 381 223
--------------------------------------------------------- ---------------------- ---------------------- -----------
Fees and commission income 3,800 4,189 9,272
Net gain from financial assets measured at fair value
through profit or loss 257 380 1,138
Gain/(loss) on private equity investments designated at
fair value through profit or loss (17) (59) 315
Other operating income 710 245 1,141
--------------------------------------------------------- ---------------------- ---------------------- -----------
Total operating income 4,575 5,136 12,089
--------------------------------------------------------- ---------------------- ---------------------- -----------
Expenses
--------------------------------------------------------- ---------------------- ---------------------- -----------
Staff costs (3,000) (3,488) (8,065)
Depreciation and amortisation (81) (59) (116)
Other operating expenses (2,060) (2,818) (5,326)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Total expenses (5,141) (6,365) (13,507)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Operating profit before tax (566) (1,229) (1,418)
Income tax (114) (51) (186)
Deferred tax - (2) -
--------------------------------------------------------- ---------------------- ---------------------- -----------
Loss from continuing operations (680) (1,282) (1,604)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Loss after tax from discontinuing operations (28) (31) (60)
Loss for the year (708) (1,313) (1,664)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Loss attributable to:
Owner of the parent (664) (1,133) (1,550)
Non-controlling interest (44) (180) (114)
--------------------------------------------------------- ---------------------- ---------------------- -----------
(708) (1,313) (1,664)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Earnings per share from continuing operations to the
owners of the parent
- Basic (4.29p) (3.63p) (5.11p)
- Diluted (4.29p) (3.63p) (5.11p)
Earnings per share from discontinuing operations attributable to the owners of the
parent
- Basic (0.19p) (0.08p) (0.21p)
- Diluted (0.19p) (0.08p) (0.21p)
Earnings per share from total profit or loss attributable to the owners of the parent
- Basic (4.48p) (3.72p) (5.32p)
- Diluted (4.48p) (3.72p) (5.32p)
Rasmala plc
Condensed consolidated statement of comprehensive income
For the six months ended 30 June 2018 (unaudited)
Year to
6 months to 30-Jun-18 6 months to 30-Jun-17 31-Dec-17
GBP'000 GBP'000 GBP'000
Loss for the year (708) (1,313) (1,664)
Items that may be reclassified
subsequently to profit or loss:
Gain on fair value of available-for-sale
securities - (31) 221
Loss on fair value of available-for-sale - 252 -
securities
Exchange loss on net investment in
foreign operations 657 (606) (1,791)
Total comprehensive loss for the year (51) (1,698) (3,234)
------------------------------------------ --------------- ---------------------- ---------------------
Total comprehensive loss attributable to:
Owners of the parent (7) (1,953) (3,116)
Non-controlling interest (44) 255 (118)
------------------------------------------ ----- -------- -----------------------------------
(51) (1,698) (3,234)
------------------------------------------ ----- -------- -----------------------------------
Rasmala plc
Condensed consolidated statement of financial position
As at 30 June 2018 (unaudited)
6 months to 30-Jun-18 6 months to 30-Jun-17 Year to
31-Dec-17
GBP'000 GBP'000 GBP'000
---------------------------------------------------- ---------------------- ---------------------- -----------
Assets
Cash and cash equivalents 9,173 3,555 6,778
Financial assets measured at fair value through
profit or loss 38,841 68,305 33,540
Financial assets measured at amortised cost 1,500 1,621 1,745
Other assets 5,761 8,117 12,005
Investment property 5,375 5,375 5,375
Property and equipment 321 248 273
Intangible assets - 9 33
Goodwill 15,043 15,440 14,755
----------------------------------------------------- ---------------------- ---------------------- -----------
76,014 102,670 75,504
Assets classified as held for sale 43 48 42
Total assets 76,057 102,718 75,546
----------------------------------------------------- ---------------------- ---------------------- -----------
Liabilities
Financial liabilities measured at fair value - - -
through profit or loss
Financial liabilities measured at amortised cost 9,673 10,705 6,359
Income tax payable 117 49 180
Deferred tax payable 315 317 313
Other liabilities 6,468 4,764 8,081
----------------------------------------------------- ---------------------- ---------------------- -----------
16,573 15,835 14,933
Liabilities associated with asset held for sale 11 12 12
Total liabilities 16,584 15,847 14,944
----------------------------------------------------- ---------------------- ---------------------- -----------
Net assets 59,473 86,871 59,602
----------------------------------------------------- ---------------------- ---------------------- -----------
Capital and reserves
Share capital 7,907 15,721 7,907
Other reserves 82,967 100,483 82,967
Fair value reserve on available-for-sale securities - - -
Foreign exchange reserve (5,325) (5,236) (5,982)
Accumulated losses (26,929) (25,797) (26,186)
----------------------------------------------------- ---------------------- ---------------------- -----------
Equity attributable to owners of parent 58,620 85,171 58,706
----------------------------------------------------- ---------------------- ---------------------- -----------
Non-controlling interest 853 1,700 896
----------------------------------------------------- ---------------------- ---------------------- -----------
Total equity 59,473 86,871 59,602
----------------------------------------------------- ---------------------- ---------------------- -----------
Rasmala plc
Condensed consolidated Cash flow statement
For the six months ended 30 June 2018 (unaudited)
6 months to 30-Jun-18 6 months to 30-Jun-17 Year to
31-Dec-17
GBP'000 GBP'000 GBP'000
--------------------------------------------------------- ---------------------- ---------------------- -----------
Cash flows from operating activities
Operating (loss)/profit for the period (566) (1,229) (1,418)
Operating loss on discontinued operations (28) (31) (60)
Adjusted for:
Unrealised loss from financial assets measured at fair
value through profit or loss (400) (134) (543)
Unrealised gain on private equity investments designated
at fair value through profit or loss 17 41 (58)
Exchange differences on financial assets measured at
fair value through profit and loss (199) - 256
Depreciation and amortisation 81 58 116
Available-for-sale securities - 25,180 25,180
Other assets 7,220 4,097 785
Financial liabilities measured at fair value through - (1,447) -
profit or loss
Other liabilities (2,546) (574) 2,696
Assets classified as held for sale - (4) -
Liabilities associated with asset held for sale - 31 -
Distribution made by a subsidiary - (82) -
--------------------------------------------------------- ---------------------- ---------------------- -----------
Cash used in operating activities 3,579 25,906 26,954
Tax paid (178) (109) (116)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Net cash generated by/ (used in) operating activities 3,401 25,797 26,838
--------------------------------------------------------- ---------------------- ---------------------- -----------
Cash flow from investing activities
Payment on acquisition of a subsidiary net of cash
acquired - (4,994) (7,497)
Financial assets measured at amortised cost 241 3,387 2,731
Financial liabilities measured at amortised cost - 668 -
Investment property - - -
Sale proceeds on disposal of investments 2,471 - 25,629
Purchase of investments (7,114) (40,901) (33,017)
Disposal of a subsidiary net of cash disposed of - - 150
Acquisition of non-controlling interests - - -
Purchase of property and equipment (89) (18) (123)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Net cash (used in)/ generated from investing activities (4,491) (41,858) (12,127)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Cash flow from financing activity
Tender Offer - - (23,443)
Proceeds from debt financing 6,755 5,425 5,411
Repayment of debt financing (3,415) - (4,252)
Foreign exchange difference on financing activity (25) - -
--------------------------------------------------------- ---------------------- ---------------------- -----------
Net cash used in investing activity 3,315 5,425 (22,284)
--------------------------------------------------------- ---------------------- ---------------------- -----------
Net increase/(decrease) in cash and cash equivalents 2,225 (10,636) (7,573)
Cash and cash equivalents at the beginning of year 6,778 14,319 14,319
Foreign exchange difference on cash and cash equivalents 170 (128) 32
--------------------------------------------------------- ---------------------- ---------------------- -----------
Cash and cash equivalents at the end of the year 9,173 3,555 6,778
--------------------------------------------------------- ---------------------- ---------------------- -----------
6 months Year to
Net Debt Reconciliation to 30-Jun-18 31-Dec-17
GBP'000 GBP'000
------------------------------ -------------- ---------------
Cash and cash equivalents 9,173 6,778
Liquid investments
(i) 13,743 8,414
Borrow repayable
within 1 year (6,812) (3,437)
Borrow repayable
after 1 year (2,861) (2,922)
Net Debt 13,243 8,833
------------------------------ -------------- ---------------
Cash and liquid investments 22,916 15,192
Gross debt - fixed
interest rates (9,673) (6,359)
Net Debt 13,243 8,833
------------------------------ -------------- ---------------
Liquid Borrow Borrow
investments less than after 1
Group 1 year year
Cash Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------- ------------- ----------- --------- --------
Net Debt as at 31 December
2017 6,778 8,414 (3,437) (2,922) 8,833
Cashflows 2,395 5,280 (3,401) 61 4,335
Foreign exchange - 49 26 - 75
Net Debt as at 30 June
2018 9,173 13,743 (6,812) (2,861) 13,243
-------- ------------- ----------- --------- --------
(i) Liquid investments comprise investments that are traded in
an active market, held within financial assets measured at fair
value through profit or loss
Notes to the condensed consolidated interim financial statements
(unaudited)
At 30 June 2018
1. Principal activities and authorisation of the financial
statements
Rasmala plc ('Company') is an investment holding company
incorporated in England on 11 January 2005.
The interim condensed consolidated financial statements of the
Company and its subsidiaries (the 'Group') for the six months ended
30 June 2018 were authorised by the Board of Directors for issue on
21 September 2018.
The condensed consolidated financial statements of the Group as
at and for the period ended 30 June 2018 are available at
www.rasmala.com
2. Accounting policies
The accounting policies applied by the Group in these condensed
consolidated interim financial statements are the same as those
applied by the Group in its consolidated financial statements as at
and for the year ended 31 December 2017.
3. Subsequent events
There are no subsequent events to report.
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END
IR BUGDCSUDBGIG
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September 21, 2018 02:00 ET (06:00 GMT)
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