DJ Global Ports Holding Plc Full Year Results 2019
Global Ports Holding PLC (GPH)
Global Ports Holding Plc Full Year Results 2019
14-Apr-2020 / 07:00 GMT/BST
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Global Ports Holding Plc
Full year results for the twelve months ended 31st December 2019
Global Ports Holding Plc ("GPH" or "Group"), the world's largest independent cruise port operator, today
announces its audited results for the twelve months ending 31 December 2019.
Financial Summary FY 2019 FY 2019 FY 2018 YoY YoY CCY
Constant
currency6
Audited Reported Change
Total Revenue 117.9 121.0 124.8 -5.6% -3.0%
($m)1
Cruise EBITDA 44.4 46.3 37.6 18.0% 23.1%
($m)9
Commercial EBITDA 39.1 39.2 53.1 -26.4% -26.3%
($m)
Segmental EBITDA 83.4 85.5 90.7 -8.0% -5.8%
($m)2
Adjusted EBITDA 77.0 79.0 83.7 -8.0% -5.6%
($m)3
Operating Profit 15.3 35.9 -57%
($m)
Profit/(Loss) (13.4) 8.6 -255%
before tax ($m)
Profit/(Loss) (15.2) 7.1 -313%
after tax ($m)
Underlying profit 27.3 59.0 -53.7%
for the period
($m)4
EPS (c) (29.5) 1.23 -2511%
Adjusted EPS (c)5 43.5 92.1 -52.9%
DPS (c) 19.9 55.5 -64.1%
Net Debt 389.2 267.2 57.4%
Net debt excluding 324.3 267.2 21.4%
impact of IFRS 16
Cash and cash 63.8 79.8 -20.1%
equivalents
Mehmet Kutman, Co-Founder and Chairman said:
............................................
"Our strong performance in Cruise in 2019 has unfortunately been overshadowed by recent events. The
Covid-19 crisis that has engulfed the world is causing unprecedented disruption to both global economies
and the global travel sector. But most importantly, it is affecting the lives of people all over the world
on a previously unimaginable scale. Our thoughts are with those people that have been directly impacted by
the virus and the health workers around the world that are battling to save so many lives.
In light of the impact of this crisis on the global travel industry, the board and senior management of
GPH have taken immediate action to significantly reduce costs and conserve cash to protect the Group's
balance sheet and help steer the company through the crisis. We believe that the actions taken to date
will mean that even under a severe downside scenario of no cruise ships calling at our ports for the
remainder of 2020 and a modest recovery at only our Caribbean ports thereafter, as well as a significant
decline in container volumes at Port Akdeniz, the Group will have sufficient cash resources to remain in
operation and within covenant requirements at the end of April 2021."
Covid-19 crisis management and actions
At the end of December 2019, GPH had cash and cash equivalents of $63.8m, as at the end of March 2020 this
figure was $53.5m, including a debt repayment of $6.5m. Available headroom in our credit lines was $20m at
the end of March 2020.
In light of the exceptional circumstances that are currently engulfing the cruise industry and with such
uncertainty over when cruise travel might return to normal, the board and management have taken several
significant actions to protect the balance sheet and long term future of the business.
The Board believe that the actions been taken to date will mean that even under a severe downside scenario
the Group will have sufficient cash resources to remain in operation and within covenant requirements at
the end of April 2021. This scenario includes our Caribbean ports handling no cruise ships for the
remainder of 2020, with a recovery in Caribbean passenger volumes in the first four months of 2021 to 50%
of previous expectations, while it assumes the rest of our cruise port portfolio does not welcome any
cruise ships until after the end of April 2021.
In terms of our Commercial operations, the severe downside scenario assumes a fall in marble exports in
Port Akdeniz to China of 75% based on the forecasted container cargo of marble for both loading and
unloading until September 2020 followed by a moderate improvement but remaining at least 25% below
original management expectations. Under this scenario Port Akdeniz container volumes would fall by 35% in
2020 compared to 2019 and by 25% compared to management's previous expectations for the period to end
April 2021.
Cost reductions
...............
The inherent flexibility in GPH's business model, including the extensive use of outsourced service
providers, means that many of our costs expand and contract in line with cruise traffic or cargo volumes.
Clearly in the current circumstances such costs in our Cruise operations have dropped to almost zero.
In terms of the costs that are more fixed in nature, $12.1m has been taken out of the cost base in the
Group's Cruise operations. This reflects a combination of actions and measures including all board members
suspending their salaries and fees, salary deferrals across the Group and significantly reduced marketing
costs and consultancy fees.
Capital expenditure and new port capital commitments
....................................................
Across our portfolio, all but essential maintenance capex has been suspended and will remain suspended
until the cruise industry starts to return towards normal. Capex at our new ports in the Caribbean is
expected to continue as planned.
The Group signed two new concession agreements in 2019, Nassau Cruise Port and Antigua Cruise Port, both
of which require future capital investment. GPH's share of this investment over the next two years, totals
over $160 million.
In Antigua, the Group's cash investment was paid from the Group's cash resources in 2019 and the balance
of the required investment will be funded through an already committed bank loan from a syndicate of
lenders.
In Nassau, the design and engineering of the marine components of the project has been completed and the
construction is expected to commence in June 2020, with an expected completion date of April 2022. The
scheduled capex over the next 12 months of up to $130m is to be fully financed by bond issuance in both
local and international markets and the remaining portion of $30m of the existing bridge loan of $50m is
to be converted into a long term loan on the same terms of the bond. Issuance of the remaining $40m bond
and $50m finance through operational cash flows is expected to be between late 2021 and the middle of
2022. Despite the current uncertainty, Nassau Cruise Port's bond issuance into the local and international
markets remains on schedule and management are confident in the levels of demand. GPH does not currently
expect the Nassau operations to require any further direct cash contribution from GPH Plc.
While the board believes that there is still considerable scope for future expansion of the business over
the medium to long term, the planned new cruise port project expenses have effectively been suspended. The
Group incurred costs of $5.1m in respect of project expenses in 2019.
Commercial Ports
................
While our scenario analysis includes a significant fall in container volumes at Port Akdeniz, with this
port currently performing in line with the board's expectations, no cost saving or cash preservation
measures have currently been taken at this port, or at Port of Adria. However, should volumes drop
significantly, the business models of our commercial operations also have an inherent flexibility which
should help to protect margins. This can be seen in the strong margin performance at Port Akdeniz in 2019,
despite significant volume declines.
Financing and concession fees
.............................
Our current plans, with the exception of an interest holiday on one loan, assume no deferral or
postponement of financial liabilities, both interest and repayment. However, management are in active
discussion with a number of the Group's lenders over potential deferrals or postponements which if agreed
would further strength the Group's forecast cash position.
A number of our ports pay guaranteed minimum concession payments and current plans include an agreed $2.6m
total reduction in these payments. The Group remains in productive and positive discussions with relevant
authorities over further potential deferrals or suspensions of minimum concession payments. If agreed
these would strength the Group's cash position still further.
Governments around the world continue to announce measures to ease the significant economic impact of this
global crisis. Many of the announced measures include policies and facilities to support companies and the
incomes of employees during these very challenging times. While management continue to explore these
government support packages, our current plans do not include the utilisation of such policies. Clearly
the utilisation of such facilities could provide further support to the Company's balance sheet during
this crisis.
As announced on 11 March 2020, in light of the unprecedented level of disruption to global trade and the
cruise industry and the associated short term uncertainty, the Board of GPH decided that it was is prudent
and in the best interests of all stakeholders to temporarily suspend the dividend for full year 2019,
until the situation becomes clearer. It will therefore not be recommending the payment of a final dividend
for 2019 at the Company's forthcoming AGM.
Eurobond and Strategic Review
.............................
The Group's $250m 2021 Eurobond has a covenant of five times Gross Debt to EBITDA. As an incurrence
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covenant and not a maintenance covenant, if this is breached, the impact would be that cash outflow from
Global Liman to other subsidiaries and dividend distributions will become restricted until such time as
the Gross Debt to EBITDA leverage falls below five times.
Management have commenced discussions with a number of investment banks to assess several options for the
Eurobond refinancing including but not limited to issuing a new Eurobond. So far considering the stage of
these discussions, there is no indication that suggests that a refinancing cannot be obtained or an
appropriate lender would not be found.
Parallel to these discussions, the final outcome of the exclusive negotiations with a potential buyer of
Port Akdeniz will have a material impact on the refinancing structure. To date, the Covid-19 outbreak has
had no meaningful impact on the exclusive negotiations over the potential sale of Port Akdeniz. A final
decision on the sale process is expected in Q3 2020, after which the Group will decide on the most
appropriate refinancing structure.
Outlook & current trading
Before the outbreak of Covid-19, 2020 was going to be the year when the strategy we have been delivering
on since IPO really started to deliver operational and financial results, with our successful expansion
into the Caribbean driving a step change in our Cruise operations.
However, while 2020 began well and operational results were in line with management expectations at both
the Cruise and Commercial divisions, the outbreak of the Covid-19 virus has had a significant impact on
our cruise operations. With travel restrictions implemented across the world, cruise itineraries have been
cancelled for a number of weeks or months and it is currently unclear when cruise activity will resume at
normal levels. Our Commercial operations have as yet not seen any negative impact and continue to track
broadly in line with management expectations.
At Port Akdeniz, Container Throughout volumes are down year on year against a relatively strong Q1 2019
but importantly volumes are in line with management expectations. General & Bulk cargo volumes have been
very strong, driven by the introduction of a number of initiatives to help drive volumes.
Providing financial guidance for the year ending 31 December 2020 is impossible in the current environment
pending further certainty over the length and extent of the current circumstances.
The inherent flexibility in GPH's business model, including the extensive use of outsourced service
providers, means that many of our costs expand and contract in line with cruise traffic. The board have
taken immediate cost saving and cash preservation measures to protect the balance sheet and preserve the
Group's liquidity position.
While there is a high level of uncertainty over the trading outlook for 2020, the Board and Senior
Management are confident in GPH's long-term strategy and its ability to navigate through this crisis.
Notes- For full definitions and explanations of each Alternative Performance measures in this statement
please refer to the Glossary of Alternative Performance Measures.
1) All $ refers to United States Dollar unless otherwise stated
2) Segmental EBITDA is calculated as income/(loss) before tax after adding back: interest; depreciation;
amortisation; unallocated expenses; and specific adjusting items
3) Adjusted EBITDA calculated as Segmental EBITDA less unallocated (holding company) expenses
4) Underlying Profit is calculated as profit / (loss) for the year after adding back: amortisation
expense in relation to Port Operation Rights, non-cash provisional income and expenses, non-cash foreign
exchange transactions and specific non-recurring expenses and income. This measure has changed since
2018, please see APM glossary for details.
5) Adjusted earnings per share is calculated as underlying profit divided by weighted average number of
shares
6) Performance at constant currency is calculated by translating foreign currency earnings from our
consolidated cruise ports, management agreements and associated ports for the current period into $ at
the average exchange rates used over the same period in the prior year.
7) Passenger numbers refer to consolidated and managed portfolio consolidation perimeter, hence it
excludes equity accounted associate ports La Goulette, Lisbon, Singapore and Venice
8) Revenue allocated to the Cruise segment is the sum of revenues of consolidated and managed portfolio
9) EBITDA allocated to the Cruise segment is the sum of EBITDA of consolidated cruise ports and pro-rata
Net Profit of equity accounted associate ports La Goulette, Lisbon, Singapore and Venice and the
contribution from the Havana management agreement
For further information, please contact:
CONTACT
For investor, analyst and For trade media enquiries:
financial media enquiries:
Global Ports Holding, Investor Global Ports Holding
Relations
Martin Brown, Investor Ceylan Erzi
Relations Director
Telephone: +44 (0) 7947 163 687 Telephone: + 90 212 244 44 40
Email: Email:
martinb@globalportsholding.com ceylane@globalportsholding.com
Investor Call
An analyst and investor call will be held today at 3.00pm (BST). Please email
martinb@globalportsholding.com for dial in details
2019 Financial Results Overview
Group - Strong delivery on strategic objectives
...............................................
· Total consolidated revenues were $117.9m in the period, a decline of 5.6% yoy (-3.0% ccy)
· Full year Segmental EBITDA - down 8.0% to $83.4m (-5.8% ccy), full year Adjusted EBITDA - declined
6.1% to
$77.0m (down 8.0% ccy), in line with management expectations
· Operating profit of $15.3m (FY 2018: $35.9m), was primarily due to $32.0m of amortisation expense in
relation to port operation rights (FY 2018 $31.6m), amortisation of right of use assets $2.4m (FY 2018:
$0.0m), amortisation
$13.3m (FY 2018: $13.0m) and one off adjustments $8.4m (FY 2018: -$2.5m). These one off adjustments were
primarily made up of project expenses of $5.1m and $2.5m of provision expenses. The total IFRS 16 impact
on operating profit was $0.8m increase
Cruise - A year of marquee additions to the portfolio, overshadowed by recent developments
..........................................................................................
· Record full year Cruise revenue up 14.8% to $63.0m (19.8% ccy) and record Cruise Segmental EBITDA up
18.0% to
$44.4m (23.1% ccy)
· Strong 2019 performance driven by the performance in Valletta and Ege in particular, as well as the
first time contribution from Nassau and Antigua in Q4
· A year of incredible progress on strategic goal of delivering inorganic growth. Signed a 25-year
concession agreement for Nassau Cruise Port, a 30-year concession agreement for Antigua Cruise Port, as
well as a 15-year management services agreement for Ha Long Bay, Vietnam, while our 50:50 JV acquired
the operator of La Goulette Cruise Port, Tunisia
· Consolidated and managed portfolio passenger volumes increased by 17.7% in the year. There was
significant growth in passenger numbers at Ege Port, our marquee Turkish cruise port, with passenger
volumes rising by 33%
· The recent travel restrictions imposed globally following the widespread outbreak of the Covid-19
virus, have had a materially negative impact on the cruise industry. Most cruise lines have, for the
first time ever, cancelled all itineraries for at least a number of weeks or months. With uncertainty
remaining as to when things might start to normalise.
Commercial - weak full year performance, driven by volume weakness
..................................................................
· Commercial Revenue down 21.5% to 54.9m (21.0% ccy) and Commercial Segmental EBITDA down -26.4% to
$39.1m (-26.3% ccy)
· In the year General & Bulk Cargo volumes fell 49.7%, and TEU throughput volumes fell by 15.9%
· The decline in TEU throughput volumes reflects the previously announced subdued marble volumes at Port
Akdeniz
· Despite the weakness, EBITDA margins remained strong at 71.2%, reflecting the inherent cost
flexibility in our business
Key Financials & FY 2019 FY 2019 FY 2018 YoY YoY
KPI Highlights CCY
Audited Constant Reported Change
currency
Total Revenue ($m) 117.9 124.8 -5.6%
121.0 -3.0%
Cruise Revenue 63.0 65.8 54.9 14.8% 19.8%
($m)8
Commercial Revenue 54.8 55.2 69.9 -21.5% -21.0%
($m)
Segmental EBITDA 83.4 85.5 90.7 -8.0% -5.8%
($m)
Cruise EBITDA 44.4 46.3 37.6 18.0% 23.1%
($m)9
Commercial EBITDA 39.1 39.2 53.1 -26.4% -26.3%
($m)
Adjusted EBITDA 77.0 79.0 83.7 -8.0% -5.6%
($m)
Segmental EBITDA 70.8% 72.7%
Margin
Cruise Margin 70.4% 68.5%
Commercial Margin 71.2% 76.0%
Adjusted EBITDA 65.3% 67.1%
Margin
Profit/(Loss) (13.4) 8.6 -255.1%
before tax ($m)
KPIs
Passengers (m 5.3 4.4 17.7%
PAX)7
General & Bulk 743.1 1,478.4 -49.7%
Cargo ('000 tons)
Container 199.18 236.7 -15.9%
Throughput ('000
TEU)
Please refer to Footnotes above for full definitions and explanations of each measure in this statement
please refer to the Glossary of Alternative Performance Measures
Chief Executive's 2019 Operational Review
2019 saw a year of 'marquee' additions to the cruise port portfolio and a good Cruise performance, which
has unfortunately now been overshadowed by the Covid-19 virus outbreak.
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While there has been no significant impact from Covid-19 on our Commercial operations, the Cruise industry
and our Cruise operations are now expected to experience a significant impact in 2020.
We are taking actions to address the financial impact and I am confident in our ability to weather this
storm. While not the circumstances we would have chosen, I believe how we successfully navigate this
crisis will stand as a testament to the strength of our business. However, our thoughts at this time are
very much with those who have been directly impacted by the Covid-19 outbreak.
2019
....
2019 saw a mixed year of operating performance from GPH. The parts that were good, were very good and most
significantly GPH successfully delivered on our plans to grow our physical reach. During the year we added
our second and third Caribbean cruise ports in the prime cruising locations of Nassau and Antigua. Both of
these ports are expected to shortly be in our top five by EBITDA.
Towards the end of the year, we also grew our presence in Asia by welcoming Ha Long Bay Cruise Port,
Vietnam into our portfolio. And in the Mediterranean, our 50:50 joint venture with MSC acquired the
operator of La Goulette Cruise Port, Tunisia.
In the summer, the Board announced a strategic review to maximise shareholder value. The review process is
ongoing, however, we have recently entered into exclusive negotiations with a potential buyer of Port
Akdeniz.
In our day-to-day operations, our Cruise port business continued to perform well, with a number of our
ports welcoming record passenger numbers or winning industry awards. However, our Commercial business came
up against challenges posed by trade tariffs, global trading uncertainty and issues in key markets such as
China. This led to an overall Group operating performance below our original expectations, with EBITDA
falling in the year.
Our full year revenue was $117.9m compared to $124.8 million in 2018. Adjusted EBITDA fell 6.1% to $77.0
million (2018: $83.7 million). With the Group generating a loss before tax of $13.4m (2018: Profit before
tax of $8.6m).
In a year that had promised more, we are nevertheless pleased to have delivered very much in line with the
long-term strategy we set out at the time of our IPO. Indeed, the addition of such high-quality cruise
ports transforms the Group, and makes Cruise our largest business segment.
Cruise
......
Our cruise business once again delivered record passenger numbers and record Segmental EBITDA in the year.
Cruise Revenue increased 14.8% to $63.0m (FY 2018: $54.9m), while Cruise segmental EBITDA rose to $44.1m,
a growth rate of 17.2%. The revenue from our cruise ports in 2019 was almost exclusively generated in USD
and Euros. Our Turkish ports and Nassau and Antigua generated all of their revenues in USD, while our
other ports generated their revenues in Euros and incur most of their costs in Euros.
We welcomed 5.3m cruise passengers to our consolidated and managed portfolio in 2019, a growth rate of
17.7%. The headline growth rate was driven by the first time contribution from the new ports in the
Caribbean, excluding these, cruise passenger volumes grew 3.4%. When we include passenger volumes from our
equity accounted associate ports of La Goulette, Lisbon, Singapore and Venice, total passenger volumes
rose 8.5% to 9.3m (FY 2018: 8.5m).
Of particular note is the strong passenger growth at both Valletta and Ege. Valletta reported passenger
growth of 27%, recovering strongly from a subdued performance in 2018. While Ege, after a few years of
subdued passenger volumes started to see volumes recover, with very strong passenger growth of 33%.
Our ancillary services offering evolved further during the year. We refurbished and transformed our travel
retail areas in Barcelona and we also made further progress with our key priority of offering an
integrated services package at our ports, which we have started rolling out at our ports in Iberia.
But the most important development in our Cruise business in 2019 was the expansion and strengthening of
our portfolio. In a series of selective additions, we welcomed three new cruise port concessions and a
further management agreement port into the GPH family and our JV in Singapore successfully secured an
extension out to 2027. The number
- and, of equal significance, the quality - of these arrivals takes our cruise port portfolio to the next
level, enhancing our presence in the cruise sector's core markets.
In the Caribbean, we signed a 25-year concession agreement for the redevelopment and management of Nassau
Cruise Port in the Bahamas, which is one of the largest of its kind in the world. We also signed a 30-year
concession agreement for cruise operations in Antigua & Barbuda.
Towards the end of the year, we added our second port in Asia with the signing of a 15-year management
services agreement for Ha Long Bay Cruise Port in Vietnam. And in the Mediterranean, our 50:50 joint
venture acquired the operating company of La Goulette cruise port in Tunisia.
The addition of these four new ports to our portfolio was a clear highlight of the year. Nassau and
Antigua, having become part of the Group in Q4 2019 contributed $2.5m and $1.8m of revenue respectively
for the year. Ha Long Bay and La Goulette joined at the end of December so there was no meaningful impact
from these ports during the year.
Excluding the impact of Covid-19, the effect of these additions will be significant, more than doubling
our passenger volumes from 2019 levels.
Cruise Port Operations 2019 2019 2018 Yoy Chge YOY CCY
Reported CCY Reported
Revenue (USD m) 63.0 65.8 54.9 14.8% 19.8%
Segmental EBITDA (USD m) 44.4 46.3 37.6 18.0% 23.1%
Segmental EBITDA Margin 70.4% 70.3% 68.5%
Passengers (m)1 5.3 4.5 17.7%
Creuers (Barcelona and
Malaga)
Revenue (USD m) 31.3 32.9 31.6 -0.9% 4.1%
Segmental EBITDA (USD m) 20.5 21.5 19.8 3.4% 8.6%
Segmental EBITDA Margin 65.4% 65.4% 62.7%
Passengers (m)1 2.6 2.51 1.5%
Ege Port
Revenue (USD m) 6.5 6.5 4.7 40.8% 40.8%
Segmental EBITDA (USD m) 4.6 4.6 3.1 48.9% 48.9%
Segmental EBITDA Margin 70.1% 70.1% 66.3%
Passengers (m)1 0.3 0.2 32.8%
Valletta Cruise Port
Revenue (USD m) 13.9 14.6 13.0 6.6% 12.0%
Segmental EBITDA (USD m) 8.0 8.4 6.4 25.4% 31.8%
Segmental EBITDA Margin 57.9% 57.9% 49.2%
Passengers (m)1 0.9 0.7 26.9%
Nassau Cruise Port
Revenue (USD m) 2.5 2.5 n/a
Segmental EBITDA (USD m) 1.8 1.8 n/a
Segmental EBITDA Margin 72.5% 72.5% n/a
Passengers (m)1 41.6% 41.6% n/a
Other Cruise
Revenue (USD m) 8.8 9.3 5.7 55.6% 63.6%
Segmental EBITDA (USD m) 9.5 10.0 8.3 13.8% 19.6%
Passengers (m)1 1.2 1.1 8.1%
Commercial
..........
The performance of our Commercial business in 2019 was disappointing, with Commercial Segmental EBITDA
declining by 26.4%
The primary drivers behind the depressed volumes were macro-economic factors such as trade tariffs and the
general uncertainty around global trade, particularly involving China. This impact was felt most at Port
Akdeniz, where container throughput volumes fell by 19.0% and general & bulk cargo volumes fell by 54.9%.
The container decline was driven by a decrease in marble volumes to China, the largest market for Antalya
marble, while general & bulk cargo volumes were mainly affected by weak cement volumes.
Port Akdeniz's significant direct exposure to China meant it felt this impact more acutely than Port Adria
where, excluding project cargo volumes, underlying trading was broadly unchanged.
Despite the sharp decline in volumes, it is testament to the strength and flexibility of our business
model that Commercial EBITDA margins were still above 70% in the year.
Following a competitive sales process conducted in the second half of 2019, GPH has entered exclusive
negotiations with a potential buyer of Port Akdeniz. A further announcement will be made when it is
appropriate to do so.
Commercial 2019 Period 2018 Yoy Chge YOY CCY
Constant Reported
currency
Reported
Revenue (USD m) 54.9 55.2 69.9 -21.5% -21.0%
Segmental 39.1 39.2 53.1 -26.4% -26.3%
EBITDA (USD m)
Segmental 72.4% 70.9% 76.0%
EBITDA Margin
General & Bulk 743.1 1478.4 -49.7%
Cargo ('000)
Throughput 199.1 236.7 -15.9%
('000 TEU)
Port Akdeniz
Revenue (USD m) 47.5 47.5 59.9 -20.7% -20.7%
Segmental 37.4 37.4 49.2 -24.0% -24.0%
EBITDA (USD m)
Segmental 78.7% 78.7% 82.1%
EBITDA Margin
General & Bulk 588.9 1305.2 -54.9%
Cargo ('000)
Throughput 150.9 186.3 -19.0%
('000 TEU)
Port Adria
Revenue (USD m) 7.4 7.8 10.0 -26.3% -22.5%
Segmental 1.7 1.8 3.9 -56.5% -54.3%
EBITDA (USD m)
Segmental 23.1% 23.1% 39.2%
EBITDA Margin
General & Bulk 154.2 173.2 -11.0%
Cargo ('000)
Throughput 48.2 50.4 -4.5%
('000 TEU)
Board changes
.............
In Q1 2020 some changes were announced to GPH's Board. Thierry Edmond Déau and Thomas Josef Maier, having
both decided not to stand for re-election as Independent Non-Executive Directors at the next AGM, agreed
to step down early to allow new board members to join as soon as practically possible.
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As a result, Andy Stuart, until recently President and Chief Executive Officer of Norwegian Cruise Line, the largest cruise line of Norwegian Cruise Line Holdings Ltd, joined the board. Andy brings vast experience of the cruise industry, gained over a period of more than 30 years, and he will be a valuable addition to the team. The process of appointing a further Non-Executive Director, with a strong background within the UK Plc environment, is well underway. A further announcement in this regard will be made when it is appropriate to do so. Financial Review Revenue for the year was $117.9m, down 5.6% (-5.0% in constancy currency) and Adjusted EBITDA fell 8.0% (-7.7% in constant currency) to $77.0m, with underlying profit falling 53% to $27.3m and loss after tax of $13.4m. Full year growth in consolidated and managed portfolio passengers was 17.7% to 5.3m, driven by the pro rata contribution from Nassau and Antigua in the year, while total passenger volumes in our portfolio volumes grew 8.5% to 9.3m, with our equity accounted associate ports (Venice, Lisbon and Singapore) welcoming 4.0m passengers. Cruise Revenue increased 14.8% to $63.0m (FY 2018: $54.9m), and Cruise segmental EBITDA increased by 18.0% to $44.4m (FY 2018: $37.6m). Our equity accounted associate ports (La Goulette, Lisbon, Singapore and Venice) performed in line with last year, with their pro-rata net income contributing at the Segmental and Adjusted EBITDA level $5.6m, (FY 2018: $5.6m). Excluding the impact of our equity accounted associates, Cruise EBITDA growth was 20.4%. On a constant currency basis, full year cruise revenue was $63.3m and Cruise segmental EBITDA was $44.5m. Commercial revenue fell 21.5% in the period to $54.8m (FY 2018: $69.9m). Port Akdeniz revenue fell by 20.7% to $47.5m (FY 2018: $59.9m), while Port Adria revenues fell by 26.3% to $7.4m (FY 2018: $10.0m). General & Bulk Cargo volumes fell 49.7% in the year, while in Containers volumes fell 15.9% in the year. Commercial Segmental EBITDA fell by 26.4% to $39.1m in the year. EBITDA at Port Akdeniz fell by 24.0%, driven by the previously disclosed significant fall in volumes during the year. Port Adria EBITDA declined by 56.5%, largely as a result of the non-recurrence of project cargo in the year. Commercial Segmental EBITDA margin of 71.2% was a sharp decline vs 2018 but in the face of such a significant drop in volumes, this performance stands as testament to the flexibility within the business model. Unallocated expenses .................... Unallocated expenses or central costs fell by 8.3% yoy to $6.4m, reflecting the annualising of our previous investment into our central functions in 2018 as well as some benefit from the weaker Turkish Lira compared to 2018 as well as a modest IFRS 16 impact. Depreciation and Amortisation Costs ................................... Depreciation and amortisation costs increased to $47.8m in the year from $44.6 million in 2018. This increase is primarily due to IFRS 16 - Leases impact, an additional $2.4m was expensed as a result of the depreciation associated with capitalising all operational leases. Specific Adjusting Items in Operating Profit ............................................ During 2019 specific adjusting items of -$8.4m comprised Project expenses amounting to -$5.1m a decrease on the -$9.6m in 2018, -$2.5 million provisions, and -$0.8m other expenses. The decrease in project expenses is mostly related to reimbursement of incurred project expenses for Antigua and Nassau Cruise Ports. The increase in provisions is mostly related to management's decision to fully provide for certain legal cases during 2019 On a statutory (IFRS) basis operating profit fell by 57.4% to $15.3m which was primarily driven by the 5.6% decline in revenues and most significantly the absence of the $12.2m positive impact from the reversal of replacement provision for the Spanish cruise ports in 2018. Share of profit of equity-accounted investees was effectively flat on the year, at $5.6m (FY 2018: $5.6m), with Net Finance Cost rising to $34.3m (FY 2018: $32.9m) driven the $2.4m impact of IFRS 16 on the treatment of operating leases. There was therefore a loss before tax of $13.4m compared to a profit before tax of $8.6m in 2018. Net Finance Costs ................. The Group's net finance charge in the period was $3.1m, a slight increase on the $32.9 million charge in 2018. The increase was primarily the result of IFRS 16 application, interest impact on operational leases, partly offset by the decrease in foreign exchange losses. The Finance charge decreased to $42.3m compared to a $60.9m charge in 2018, this was primarily due to the decrease in TL fluctuation against other currencies; which resulted significant non-cash losses, when revaluing the Eurobond debt as this is issued by a Turkish Lira denominated, 100% owned entity within the group, along with non-cash revaluations on Turkish entities foreign currency dominated liabilities. Finance income also decreased to $8.1m as a result of a stable year in currency movement of TL against other currencies, due to non-cash revaluations on Turkish entities foreign currency dominated assets. Net interest expense increased by $3.1m to $28.4m (2018: $25.2m). This is due to the IFRS 16 - Leases application, an additional $64.8m lease liability was recognised on Balance Sheet, as a result of long term concession contracts capitalisation. Taxation ........ The Group's effective tax rate was 26.34% in the year compared to 25.56% in prior year. Global Ports Holding is a multinational group and as such is liable for taxation in multiple jurisdictions around the world. The Group's tax charge for the period was $1.9m compared to $1.5m in 2018. The Group is paying corporate tax due to specific components being profitable however due to group tax relief restrictions, losses created on other components (mostly sub-holding companies) cannot be utilised. On a cash basis, the Group's income taxes paid amounted to $7.2m in line with the $7.3m paid in 2018. Earnings Per Share .................. The Group's Basic earnings per share was a loss of -29.54c (FY 2018: 1.23c), this decrease is in line with the decreases in loss/profit for the year attributable to owners of the company to -$18.6m (2018: $0.8m). Underlying earnings per share is underlying profit divided by weighted average number of shares. Underlying earnings per share of 43.5c (FY 2018: 94.0c), was primarily driven by the adding back of the amortisation of port operating rights of $34.5m (FY 2018: $31.6m), non-cash charge of provisional expenses $2.5m (FY 2018: $0.5m) and charge of unrealised portion of unhedged portion of GLI Eurobond of $5.2m (FY 2018: 17.6m). Cash Flow and Investment ........................ Operating cash flow was $37.1m (FY 2018: $61.1m). Capital expenditure during the period was $24.0m, an increase on the $14.8m incurred in FY 2018. The increase is mostly related to expenses made on new project development amounting $8.2 million and $5.7 million for the new Pier construction in Antigua. $21 million included in the consolidated cash flow statement is related to the repayment of a bond on behalf of the Government of Antigua as part of signing the concession agreement. Other areas of investment included $1.5 million on office and terminal improvement in Barcelona, $1.6 million in port operating rights for the extension in Bodrum, $3.1 million on enhancements to superstructure in Port Akdeniz, $1.6 million on enhancements to superstructure in Port of Adria. Dividends paid to equity owners totals $29.2m during the year, comprising the final dividend in respect of 2018 of $16.7 million and the interim dividend in respect of 2019 of $12.5 million. Balance Sheet Pre-IFRS 16 Gross debt at 31 December 2019 was $388.6 million compared to $347.1 million at 31 December 2018. Post IFRS 16 Gross debt at period end was $453.0m (31st December 2018: $347.1m), the increase was mainly driven by recognition of lease liabilities of the concession agreements in line with IFRS 16 - Leases resulted in an increase of $65.4m in financial statements. New loans received in Antigua and Nassau amounting $15.2m and $16.0m, respectively, for financing of the investment and construction of Port facilities. Capital expenditure requirements were financed through non-recourse drawdowns, partially offset by partial repayment of loans in Barcelona and Valletta Cruise Port. The Leverage Ratio as per GPH's Eurobond covenant requirement increased to 4.65x at 31st December 2019 (31st December 2018: 4.2x), vs a restrictive covenant requirement of 5.0x. At 31 December 2019 pre IFRS net debt was $324.3m compared to $267.2m at 31 December 2018. Post IFRS 16 net debt at the end of year was $389.1m. This increase was mainly driven by the change in gross debt described above and cash used for investments and capex activity the year. The group's pre IFRS 16 Net Debt/Adjusted EBITDA ratio was 4.3x times as at 31 December 2019 compared to 3.2x at 31 December 2018. Dividend The Company paid a $12.5m interim dividend (15.5 pence per share) in November 2019. In terms of a full year dividend payment, in light of the unprecedented level of disruption to global trade and the cruise industry and the associated short term uncertainty, the Board of GPH decided that it was prudent and in the best interests of all stakeholders to temporarily suspend the dividend for full year 2019, until the situation becomes clearer. GLOSSARY OF ALTERNATIVE PERFORMANCE MEASURES (APM) These financial statements includes certain measures to assess the financial performance of the Group's business that are termed "non-IFRS measures" because they exclude amounts that are included in, or include amounts that are excluded from, the most directly comparable measure calculated and presented in accordance with IFRS, or are calculated using financial measures that are not calculated in accordance
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DJ Global Ports Holding Plc Full Year Results 2019 -5-
with IFRS. These non-GAAP measures comprise the following;
Segmental EBITDA
................
Segmental EBITDA calculated as income/(loss) before tax after adding back: interest; depreciation;
amortisation; unallocated expenses; and specific adjusting items.
Management evaluates segmental performance based on Segmental EBITDA. This is done to reflect the fact
that there is a variety of financing structures in place both at a port and Group-level, and the nature of
the port operating right intangible assets vary by port depending on which concessions were acquired
versus awarded, and which fall to be treated under IFRIC 12. As such, management considers monitoring
performance in this way, using Segmental EBITDA, gives a more comparable basis for profitability between
the portfolio of ports and a metric closer to net cash generation. Excluding project costs for
acquisitions and one-off transactions such as project specific development expenses as well as unallocated
expenses, gives a more comparable year-on-year measure of port-level trading performance.
Management is using Segmental EBITDA for evaluating each port and group-level performances on operational
level. As per management's view, some specific adjusting items included on the computation of Segmental
EBITDA.
Specific adjusting items
........................
The Group presents specific adjusting items separately. For proper evaluation of individual ports
financial performance and consolidated financial statements, Management considers disclosing specific
adjusting items separately because of their size and nature. These expenses and income include project
expenses; being the costs of specific M&A activities and the costs associated with appraising and securing
new and potential future port agreements which should not be considered when assessing the underlying
trading performance, the replacement provisions, being provision created for replacement of fixed assets
which does not include regular maintenance, employee termination expenses, income from insurance
repayments, income from scrap sales, gain/loss on sale of securities, other provision expenses, redundancy
expenses and donations and grants.
Specific adjusting items comprised as following,
Year ended 31 December 2019 Year ended 31
December 2018
(USD '000)
(USD '000)
Project expenses 5,146 9,594
Employee termination expenses 215 147
Replacement provisions 673 677
Provisions / (reversal of 1,569 (12,210)
provisions)
Other expenses 788 (690)
Specific adjusting items 8,391 (2,482)
Adjusted EBITDA
...............
Adjusted EBITDA calculated as Segmental EBITDA less unallocated (holding company) expenses.
Management uses Adjusted EBITDA measure to evaluate Group's consolidated performance on an "as-is" basis
with respect to the existing portfolio of ports. Notably excluded from Adjusted EBITDA, the costs of
specific M&A activities and the costs associated with appraising and securing new and potential future
port agreements. M&A and project development are key elements of the Group's strategy in the Cruise
segment. Project lead times and upfront expenses for projects can be significant, however these expenses
(as well as expenses related to raising financing such as IPO or acquisition financing) do not relate to
the current portfolio of ports but to future EBITDA potential. Accordingly, these expenses would distort
Adjusted EBITDA which management is using to monitor the existing portfolio's performance.
A full reconciliation for Segmental EBITDA and Adjusted EBITDA to profit before tax is provided in the
Segment Reporting Note 2 to these financial statements.
Underlying Profit
.................
Management uses this measure to evaluate the profitability of the Group normalised to exclude the specific
non- recurring expenses and income, non-cash foreign exchange transactions, and adjusted for the non-cash
port intangibles amortisation charge, giving a measure closer to actual net cash generation, which the
directors' consider a key benchmark in making the dividend decision. Underlying Profit is also consistent
with Consolidated Net Income (CNI), as defined in the Group's 2021 Eurobond, which is monitored to ensure
covenant compliance.
Underlying Profit is calculated as profit / (loss) for the year after adding back: amortization expense in
relation to Port Operation Rights, non-cash provisional income and expenses, non-cash foreign exchange
transactions and specific non-recurring expenses and income.
Adjusted earnings per share
...........................
Adjusted earnings per share is calculated as underlying profit divided by weighted average per share.
Management uses these measures to evaluate the profitability of the Group normalised to exclude the gain
on reversal of provisions, non-cash provisional income and expenses, gain or loss on foreign currency
translation on equity, unhedged portion of investment hedging on Global Liman, adjusted for the non-cash
port intangibles amortisation charge, and adjusted for change in accounting policies, giving a measure
closer to actual net cash generation, which the directors' consider a key benchmark in making the dividend
decision. Underlying Profit is also consistent with Consolidated Net Income (CNI), as defined in the
Group's 2021 Eurobond, which is monitored to ensure covenant compliance. Management decided this year that
in the light of a more meaningful presentation of the underlying profit, the unhedged portion of the
investment hedge on Global Liman and any gain or loss on foreign currency translation on equity as
explained in note 7 have been excluded.
Underlying profit and adjusted earnings per share computed as following;
Year ended 31 Year ended 31
December 2019 December 2018
(USD '000) (USD '000)
(Loss) / Profit for the (13,597) 7,136
Period, net of IFRS 16
impact
Impact of IFRS 16 (1,622) --
(Loss) / Profit for the (15,219) 7,136
Period
Amortisation of port
operating rights / RoU
asset /
34,453 31,648
Investment Property
Gain on reversal of -- (12,209)
provisions
Non-cash provisional 2,457 502
(income) / expenses
Unhedged portion of 5,222 17,552
Investment hedging on
Global Liman
(Gain) / loss on foreign 414 14,417
currency translation on
equity
Underlying Profit 27,327 59,046
Weighted average number of 62,826,963 62,826,963
shares
Adjusted earnings per 43.5 94.0
share (pence)
Net debt
........
Net debt comprises total borrowings (bank loans, Eurobond and finance leases net of accrued tax) less
cash, cash equivalents and short term investments.
Management includes short term investments into the definition of Net Debt, because these short term
investment are comprised of marketable securities which can be quickly converted into cash.
Net debt comprised as following;
Year ended 31 Year ended 31
December 2019 December 2018
(USD '000) (USD '000)
Current loans and 62,691 48,755
borrowings
Non-current loans and 390,299 298,296
borrowings
Gross debt 452,990 347,051
Lease liabilities (64,828) --
recognized due to IFRS 16
application
Gross debt, net of IFRS 388,162 347,051
16 impact
Cash and bank balances (63,780) (79,829)
Short term financial (71) (72)
investments
Net debt 324,311 267,150
Equity 155,263 215,721
Net debt to Equity ratio 2.09 1.24
Leverage ratio
..............
Leverage ratio is used by management to monitor available credit capacity of the Group. Leverage ratio is
computed by dividing gross debt to Adjusted EBITDA.
Leverage ratio computation is made as follows;
Year ended 31 Year ended 31
December 2019 December 2018
(USD '000) (USD '000)
Gross debt 452,990 347,051
Lease liabilities (64,828) --
recognised due to IFRS
16 application
Gross debt, net of IFRS 388,162 347,051
16 impact
Adjusted EBITDA 77,015 83,714
Impact of IFRS 16 on (3,204) --
EBITDA
Adjusted EBITDA, net of 73,811 83,714
IFRS 16 impact
Leverage ratio* 5.26x 4.15x
* As per Eurobond definition on note 13, Cruceros, NCP, GPH Antigua and GPH PLC Gross Debt (net off ifrs
16 impact amounted to USD 35,635 thousand) and adjusted EBITDA (USD 391 thousand) figures should be
excluded from above computation of leverage ratio in order to arrive at the covenant ratio as per Eurobond
memorandum. This will result to a 4.8x leverage ratio, which is below 5x covenant threshold.
CAPEX
.....
CAPEX represents the recurring level of capital expenditure required by the Group excluding M&A related
capital expenditure.
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DJ Global Ports Holding Plc Full Year Results 2019 -6-
CAPEX computed as 'Acquisition of property and equipment' and 'Acquisition of intangible assets' per the
cash flow statement.
Year ended 31 Year ended 31
December 2019 December 2018
(USD '000) (USD '000)
Acquisition of property 15,813 11,896
and equipment
Acquisition of intangible 8,155 2,911
assets *
CAPEX 23,968 14,807
* Acquisition of intangible assets doesnot include port operating rights.
Cash conversion ratio
.....................
Cash conversion ratio represents a measure of cash generation after taking account of on-going capital
expenditure required to maintain the existing portfolio of ports.
It is computed as Adjusted EBITDA less CAPEX divided by Adjusted EBITDA.
Year ended 31 December Year ended 31
2019 December 2018
(USD '000) (USD '000)
Adjusted EBITDA 77,015 83,714
Impact of IFRS 16 on EBITDA (3,204) --
Adjusted EBITDA, net of IFRS 73,811 83,714
16 impact
CAPEX (23,968) (14,912)
Cash converted after CAPEX 49,843 68,802
Cash conversion ratio 67.5% 82.2%
Hard currency
.............
Management uses the term hard currency to refer to those currencies that historically have been less
susceptible to exchange rate volatility. For the year ended 31 December 2019 and 2018, the relevant hard
currencies for the Group are US Dollar, Euro and Singaporean Dollar.
Year ended 31 Year ended 31
December December
2019 2018
Note
(USD '000) (USD '000)
Revenue 3 117,884 124,812
Cost of sales 4 (79,884) (77,523)
Gross profit 38,000 47,289
Other income 6 3,501 19,728
Selling and marketing (2,109) (1,293)
expenses
Administrative expenses 5 (15,505) (15,993)
Other expenses 6 (8,580) (13,834)
Operating profit 15,307 35,897
Finance income 7 8,082 27,955
Finance costs 7 (42,333) (60,867)
Net finance costs (34,251) (32,912)
Share of profit of 10 5,580 5,631
equity-accounted investees
(Loss) / Profit before tax (13,364) 8,616
Tax expense (1,855) (1,480)
(Loss) / Profit for the (15,219) 7,136
year
Profit / (Loss) for the
year attributable to:
Owners of the Company (18,558) 770
Non-controlling interests 3,339 6,366
(15,219) 7,136
the accompanying notes form part of these financial statements
Year ended 31 Year ended 31
December December
2019 2018
Note
(USD '000) (USD '000)
Other comprehensive
income
Items that will not be
reclassified subsequently
to profit or loss
Remeasurement of defined (40) (19)
benefit liability
Income tax relating to
items that will not be
reclassified subsequently
to profit or loss
9 4
(31) (15)
Items that may be
reclassified subsequently
to profit or loss
Foreign currency 14,774 42,107
translation differences
Cash flow hedges -
effective portion of
changes in
335 155
fair value
Cash flow hedges -
realized amounts
transferred to income
statement
(246) (216)
Losses on a hedge of a (24,725) (59,630)
net investment
(9,862) (17,584)
Other comprehensive
income / (loss) for the
year, net of income tax
(9,893) (17,599)
Total comprehensive (25,112) (10,463)
income / (loss) for the
year
Total comprehensive
income / (loss)
attributable to:
Owners of the Company (26,757) (12,315)
Non-controlling interests 1,645 1,852
(25,112) (10,463)
Basic and diluted
earnings / (loss) per
share (cents per share)
14 (29.5) 1.23
the accompanying notes form part of these financial statements
As at 31 As at 31
December December
Note
2019 2018
(USD '000) (USD '000)
Non-current assets
Property and equipment 8 130,511 129,351
Intangible assets 9 424,618 392,361
Right of use assets 16 81,123 --
Investment property 17 2,139 --
Goodwill 13,485 13,485
Equity-accounted 10 26,637 26,003
investments
Due from related parties 18 6,811 --
Other investments 4 12,013
Deferred tax assets 2,179 3,066
Other non-current assets 4,573 4,626
692,080 580,905
Current assets
Trade and other 31,022 19,999
receivables
Due from related parties 18 771 1,027
Other investments 71 72
Other current assets 3,916 3,336
Inventories 1,393 1,454
Prepaid taxes 1,846 1,363
Cash and cash 11 63,780 79,829
equivalents
102,799 107,080
Total assets 794,879 687,985
Current liabilities
Loans and borrowings 13 62,691 48,755
Other financial 4,536 --
liabilities
Trade and other payables 21,367 15,279
Due to related parties 18 1,317 542
Current tax liabilities 2,725 2,459
Provisions 2,043 955
94,679 67,990
Non-current liabilities
Loans and borrowings 13 390,299 298,296
Other financial 50,394 3,408
liabilities
Deferred tax liabilities 84,715 92,294
Provisions 18,175 8,862
Employee benefits 869 797
Derivative financial 485 617
liabilities
544,937 404,274
Total liabilities 639,616 472,264
Net assets 155,263 215,721
Equity
Share capital 12 811 811
Legal reserves 12 13,144 13,030
Share based payment 239 --
reserves
Hedging reserves 12 (220,029) (195,393)
Translation reserves 12 213,715 197,247
Retained earnings 61,053 108,981
Equity attributable to 68,933 124,676
equity holders of the
Company
Non-controlling 86,330 91,045
interests
Total equity 155,263 215,721
The Group has initially applied IFRS 16 at 1 January 2019, using the modified retrospective approach.
Under this approach, comparative information is not restated and the cumulative effect of initially
applying IFRS 16 (if any) is recognised in retained earnings at the date of initial application. See Note
1.
the accompanying notes form part of these financial statements
Share
based
payment
Share Legal Hedging Translation Retained Non- Total
capit reser reserve earnings cont equit
al ves reserves s roll y
in g
(USD '000) Notes reserves Total inte
rest
s
Balance at 1 811 13,03 -- (195,39 197,247 108,981 124,6 91,0 215,7
January 2019 0 3) 76 45 21
Adjustment
on initial
application
of IFRS 16
-- -- -- -- -- -- -- -- --
(net of tax)
(*)
Adjusted 811 13,03 -- (195,39 197,247 108,981 124,6 91,0 215,7
balance at 1 0 3) 76 45 21
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DJ Global Ports Holding Plc Full Year Results 2019 -7-
January 2019
(Loss) / -- -- -- -- -- (18,558) (18,5 3,33 (15,2
income for 58) 9 19)
the year
Other
comprehensiv
e (loss) /
income for
the -- -- -- (24,636 16,468 (31) (8,19 (1,6 (9,89
) 9) 94) 3)
year
Total
comprehensiv
e (loss) /
income for
the year -- -- -- (24,636 16,468 (18,589) (26,7 1,64 (25,1
) 57) 5 12)
Transactions
with owners
of the
Company
Transactions -- -- -- -- -- -- -- 6 6
with
non-controll
ing interest
Transfer to 12 -- 114 -- -- -- (114) -- -- --
legal (b) i
reserves
Equity -- -- 239 -- -- -- 239 -- 239
settled
share-based
payment
expenses
Dividends 12 -- -- -- -- -- (29,225) (29,2 (6,3 (35,5
(c) 25) 66) 91)
Total -- 114 239 -- -- (29,339) (28,9 (6,3 (35,3
contribution 86) 60) 46)
s and
distribution
s
Total -- 114 239 (24,636 16,468 (47,928) (55,7 (4,7 (60,4
transactions ) 43) 15) 58)
with owners
of the
Company
Balance at 811 13,14 239 (220,02 213,715 61,053 68,93 86,3 155,2
31 December 4 9) 3 30 63
2019
(*) The Group has initially applied IFRS 16 at 1 January 2019, using the modified retrospective approach.
Under this approach, comparative information is not restated and the cumulative effect of initially
applying IFRS 16 (if any) is recognized in retained earnings at the date of initial application. See Note
1.
the accompanying notes form part of these financial statements
Non-
(USD '000) Notes Share Share Legal Hedging Translation Retained Total controlling Total
capit premi reser reserve earnings interests equit
al um ves s y
reserves
Balance at 1 12 811 -- 13,01 (135,76 150,626 143,148 171,8 92,896 264,7
January 2018 2 3) 34 30
(Loss) / -- -- -- -- -- 770 770 6,366 7,136
income for
the year
Other
comprehensiv
e (loss) /
income for
the -- -- -- (59,630 46,621 (76) (13,0 (4,514) (17,5
) 85) 99)
year
Total
comprehensiv
e (loss) /
income for
the year -- -- -- (59,630 46,621 694 (12,3 1,852 (10,4
) 15) 63)
Transactions
with owners
of the
Company
Transactions -- -- -- -- -- -- -- 94 94
with
non-controll
ing interest
Transfer to -- -- 18 -- -- (18) -- -- --
legal
reserves
Dividends 12 -- -- -- -- -- (34,843) (34,8 (3,797) (38,6
(c) 43) 40)
Total -- -- 18 -- -- (34,861) (34,8 (3,703) (38,5
contribution 43) 46)
s and
distribution
s
Total -- -- 18 (59,630 46,621 (34,167) (47,1 (1,851) (49,0
transactions ) 58) 09)
with owners
of the
Company
Balance at 811 -- 13,03 (195,39 197,247 108,981 124,6 91,045 215,7
31 December 0 3) 76 21
2018
the accompanying notes form part of these financial statements
For the years ended 31 December 2019 and 2018
Year ended 31 Year ended 31
Note December 2019 December 2018
(USD '000) (USD '000)
Cash flows from
operating activities
(Loss) / Profit for the (15,219) 7,136
year
Adjustments for:
Depreciation of PPE, 8, 9, 16, 17 47,737 44,668
and RoU assets, and
amortization expense
Share of profit of 10 (5,580) (5,631)
equity-accounted
investees, net of tax
Gain on disposal of (17) (142)
property plant and
equipment
Finance costs 30,571 26,623
(excluding foreign
exchange differences)
Finance income (2,017) (1,684)
(excluding foreign
exchange differences)
Foreign exchange 5,697 7,973
differences on finance
costs and income, net
Income tax (benefit) / 1,855 1,480
expense
Employment termination 139 39
indemnity reserve
Equity settled 239 --
share-based payment
expenses
Reversal of / (Charges 1,676 (12,000)
to) Provision
Operating cash flow
before changes in
operating assets and
liabilities
65,081 68,462
Changes in:
- trade and other (11,023) (4,297)
receivables
- other current assets (1,003) 3,510
- related party (6,555) 572
receivables
- other non-current 346 412
assets
- trade and other (11,849) (71)
payables
- related party 775 59
payables
- Post-employment (31) (131)
benefits paid
- provisions 8,573 (64)
Cash generated by
operations before
benefit and tax
payments
44,314 68,452
Income taxes paid (7,195) (7,345)
Net cash generated from 37,119 61,107
operating activities
Investing activities
Acquisition of property 8 (15,813) (11,896)
and equipment
Acquisition of 9 (8,155) (2,911)
intangible assets
Acquisition of a lease (21,000) --
asset
Proceeds from sale of 35 234
property and equipment
Bond and short-term -- (30)
investment income
Proceeds from sale of -- 13,944
investments
Bank interest received 251 348
Dividends from equity 2,849 541
accounted investees
Proceeds from sale of 13,184 --
other investments in
FVTPL instruments
Investment in equity (61)
accounted investee
Incorporation of (5) --
subsidiary
Other Investment in -- (11,977)
FVTPL instruments
Advances given for (292) (85)
tangible assets
Net cash (used in)/from (29,007) (11,832)
investing activities
Financing activities
Equity injection by 7 94
minorities to
subsidiaries
Dividends paid to 12(c) (29,225) (34,843)
equity owners
Dividends paid to NCIs 12(c) (5,062) (3,797)
Interest paid (26,388) (23,902)
Proceeds from 74,918 44,205
borrowings
Repayments of (31,949) (34,697)
borrowings
Repayments of lese
liabilities (2018:
payment of finance
lease
(3,066) (1,427)
liabilities) (*)
Net cash (used in)/from (20,765) (54,367)
financing activities
Net increase / (12,653) (5,092)
(decrease in cash and
cash equivalents
Effect of foreign
exchange rate changes
on cash and cash
(3,396) (14,527)
equivalents
Cash and cash 11 79,829 99,448
equivalents at
beginning of year
Cash and cash 11 63,780 79,829
equivalents at end of
year
(*) The Group has initially applied IFRS 16 at 1 January 2019, using the modified retrospective approach.
Under this approach, comparative information is not restated and the cumulative effect of initially
applying IFRS 16 (if any) is recognised in retained earnings at the date of initial application. See Note
1.
the accompanying notes form part of these financial statements
1) Basis of preparation
Global Ports Holding PLC is a public company incorporated in the United Kingdom and registered in England
and Wales under the Companies Act 2006. The address of the registered office is 34 Brook Street 3rd Floor,
London W1K 5DN, United Kingdom. Global Ports Holding PLC is the parent company of Global Liman Isletmeleri
A.S. and its subsidiaries (the "Existing Group"). The majority shareholder of the Company is Global
Yatirim Holding.
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DJ Global Ports Holding Plc Full Year Results 2019 -8-
The financial information for the year ended 31 December 2019 contained in this News Release was approved
by the Board on 13 April 2020. These condensed Financial Statements for the year ended 31 December 2019
have been prepared in accordance with the Disclosure Guidance and Transparency Rules of the Financial
Conduct Authority. They have been prepared in accordance with EU endorsed International Financial
Reporting Standards ("IFRSs") but do not comply with the full disclosure requirements of these standards.
The financial information set out above does not constitute the company's statutory accounts for the years
ended 31 December 2019 or 2018.
Statutory financial statements for the year ended 31 December 2019, which have been prepared on a going
concern basis, will be delivered to the Registrar of Companies in due course. The auditor has reported on
those financial statements. Their report was not qualified, did not include a reference to any matters to
which the auditors drew attention by way of emphasis without qualifying their report, and did not contain
a statement under Section 498 (2) or (3) of the Companies Act 2006.
Accounting policies
With the exception of those changes described below the accounting policies adopted of these Condensed
Financial Statements are consistent with those described on pages 172 - 185 of the Annual Report and
Financial Statements for the year ended 31 December 2018.
In the year ended 31 December 2019, the Group applied a number of amendments to IFRSs issued by the
International Accounting Standards Board (IASB) that are mandatorily effective for an accounting period
that begins on or after 1 January 2019. The Group has adopted IFRS 16 Leases and IFRS 2 Share-based
payment arrangements from 1 January 2019. A number of other new standards are effective from 1 January
2019 but they do not have a material effect on the Group's financial statements.
The effect of initially applying these standards is mainly attributed to the following:
The Group applied IFRS 16 using the modified retrospective approach, under which the cumulative effect of
initial application is recognised in retained earnings at 1 January 2019. Accordingly, the comparative
information presented for 2018 is not restated - i.e. it is presented, as previously reported, under IAS
17 and related interpretations. The details of the changes in accounting policies are disclosed below.
Additionally, the disclosure requirements in IFRS 16 have not generally been applied to comparative
information.
Definition of a lease
Previously, the Group determined at contract inception whether an arrangement was, or contained, a lease
under IFRIC 4 Determining Whether an Arrangement contains a Lease. The Group now assesses whether a
contract is or contains a lease based on the new definition of a lease as explained in note 3I of the
Annual report and financial statements. Under IFRS 16, a contract is, or contains, a lease if the contract
conveys a right to control the use of an identified asset for a period of time in exchange for
consideration.
On transition to IFRS 16, the Group elected to apply the practical expedient to grandfather the assessment
of which transactions are leases. The Group applied IFRS 16 only to contracts that were previously
identified as leases. Contracts that were not identified as leases under IAS 17 and IFRIC 4 were not
reassessed for whether there is a lease under IFRS 16. Therefore, the definition of a lease under IFRS 16
has been applied only to contracts entered into or changed on or after 1 January 2019.
As a lessee
...........
As a lessee, the Group leases many assets including land, property, and cars. The Group previously
classified leases as operating or finance leases based on its assessment of whether the lease transferred
significantly all of the risks and rewards incidental to ownership of the underlying asset to the Group.
Under IFRS 16, the
Group recognises right-of-use assets and lease liabilities for most of these leases - i.e. these leases
are on-balance sheet.
Lease payments linked to an index or rate are included in the initial measurement of the lessee's lease
liability and ROU asset using the index as at the commencement date or transition date for existing lease
agreements. For any subsequent changes in those indices, the lease liability needs to be measured with the
corresponding increase/decrease to be accounted in the ROU assets.
Leases classified as operating leases under IAS 17
Previously, the Group classified lease payments under concession agreements which do not fall within IFRIC
122, as operating leases under IAS 17. On transition, for these leases, lease liabilities were measured at
the present value of the remaining lease payments, discounted at the related Subsidiary's incremental
borrowing rate as at 1 January 2019. Right-of-use assets are measured at:
· an amount equal to the lease liability, adjusted by the amount of any prepaid or accrued lease
payments: the Group applied this approach to its concession agreements that fall outside of IFRIC 12
scope.
The Group has tested its right-of-use assets for impairment on the date of transition as part of the
relevant CGU and has concluded that there is no indication that the right-of-use assets are impaired.
The Group used a number of practical expedients when applying IFRS 16 to leases previously classified as
operating leases under IAS 17. In particular, the Group:
· did not recognise right-of-use assets and liabilities for leases for which the lease term ends within
12 months of the date of initial application;
· did not recognise right-of-use assets and liabilities for leases of low value assets;
· excluded initial direct costs from the measurement of the right-of-use asset at the date of initial
application; and
· used hindsight when determining the lease term.
Leases classified as finance leases under IAS 17
The Group leases a number of items of machinery and equipment. These leases were classified as finance
leases under IAS 17. For these finance leases, the carrying amount of the right-of-use asset and the lease
liability at 1 January 2019 were determined at the carrying amount of the lease asset and lease liability
under IAS 17 immediately before that date.
As a lessor
The accounting policies applicable to the Group as a lessor are not different from those under IAS 17. The
Group is not required to make any adjustments on transition to IFRS 16 for leases in which it acts as a
lessor.
Impacts on transition
.....................
On transition to IFRS 16, the Group recognised right-of-use assets including investment propoerty and
additional lease liabilities. For the annual year starting at 1 January 2019, the Right-of-use assets have
been measured at an amount equal to the lease liability, adjusted by the amount of any prepaid or accrued
lease payments. The impact on transition is summarized below.
USD'000 1 January 2019
Right of use assets 58,983
Investment property 2,250
Prepayments 328
Accruals (1,423)
Lease liabilities 62,328
For the impact of IFRS 16 on segment information and EBITDA, see Note 2.
When measuring lease liabilities for leases that were classified as operating leases, the Group discounted
lease payments using its incremental borrowing rate at 1 January 2019. The weighted- average rate applied
is 3.4%.
USD'000 1 January 2019
Operating lease commitment at 31 December 2018 as
disclosed in the Group's
158,860
consolidated financial statements
Discounted using the incremental borrowing rate 61,268
at 1 January 2019
Finance lease liabilities recognised as at 31 1,905
December 2018
- Recognition exemption for short-term leases (35)
Lease liabilities recognised at 1 January 2019 63,138
The Group presents right-of-use assets are presented as a line item on the face of financials. The
carrying amounts of right-of-use assets are as below.
USD'000 Right of Use Investment property
Balance at 1 January 2019 58,983 2,250
Balance at 31 December 2019 81,123 2,139
The Group presents lease liabilities in 'loans and borrowings' in the statement of financial position. The
adoption of IFRS 16 does not impact the ability of the Group to comply with its Gross debt to EBITDA
covenant. Details described on Note 13.
On 1 January 2019, the Group established share option program that entitles key management personnel to
receive shares in the Company based on the performance of the Company during the vesting period. Under
this program, holders of vested option are entitled to receive shares of the Company at the grant date.
Currently, this program is limited to key management personnel and other senior employees.
The option will be settled by physical delivery of shares.
On 1 January 2019, the Group granted 204,000 Restricted Stock Units (RSUs) to employees that entitle them
to a share issued after three years of service. The RSUs will be granted at the end of three-year vesting
period and issued after two year holding period. Shares issued under the LTIP are subject to a dilution
limit of up to 3% over 10 years, which will be monitored by the Committee. Upon vesting of an RSU,
Employees must pay the par value in respect of each share that vests. Employees are also responsible to
declare and pay the tax related to gains from RSUs to the authorities.
The grant-date fair value of equity-settled share-based payment arrangements granted to employees is
generally recognised as an expense, with a corresponding increase in equity, over the vesting period of
the awards. The amount recognised as an expense is adjusted to reflect the number of awards for which the
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related service and non-market performance conditions are expected to be met, such that the amount ultimately recognised is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. Going concern The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Commercial and Cruise business models on pages 14 to 17 of the Annual report and financial statements. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in the financial review on pages 22 to 23 of the Annual report and financial statements. In addition, notes 3 and 32 of the Annual report and financial statements to the financial statements include the Group's objectives, policies and processes for managing its capital; its financial risk management objectives; details of its financial instruments and hedging activities; and its exposures to credit risk and liquidity risk. The Group's portfolio consists of investments in or management of 19 cruise ports and two commercial ports in 13 countries which diversifies economic and political risks. As a consequence, the directors believe that the Group is well placed to manage its business risks successfully despite the current uncertain economic outlook. The principal events and conditions identified by Management that have the most significant impact on the going concern of the Group are: a) the passenger levels that will be observed during the Going Concern assessment period of not less than 12 months from the date of approval of these Annual Report and Accounts in view of the COVID-19 situation and the associated effect on Group revenues and cash position; b) the refinancing of the Group's Eurobond principal amounting to USD 250 million which has a maturity date of 14 November 2021; c) the financing requirements for committed and planned expenditure over the following 24 months, particularly in respect of the Group's newly acquired Caribbean Ports totalling USD 160 million (GPH Group's portion) and d) any negative business outlook on commercial operations related to macro-economic factors such as trade tariffs and their associated impact on global economies. The uncertainty caused by the recent COVID-19 outbreak has been considered by the Group. The Group's main cruise port portfolio is located in Mediterranean region. Peak season for the cruise business in Mediterranean region starts in early May, due to the seasonality of the cruise business, with passenger numbers during the first Q1 budgeted and observed to be low. However, as at the approval date of these Annual Report and Accounts, the Group has experienced a significant level of cancellations for the April-May 2020 period from cruise line customers. One of the major export products in Port Akdeniz is marble exports to China. After the closing of borders in China due to the spread of COVID-19, there were several delays in marble exports experienced in Q1. Management does not expect these delays to cause significant impact on the business and the fall in container volumes the Port is experiencing during the first months of 2020 is partly offset by an increase in general and bulk cargo volumes. A recovery of marble export is expected in 2020. Management has considered the potential impact of COVID-19 outbreak on the Group's results and financial position. The following key, base case, assumptions were used in preparing this analysis: · A fall to zero in the number of cruise passengers arriving at all ports in the GPH portfolio for a period to 1 June 2020 with a corresponding impact on passenger revenues and ports' variable expenses. · A fall in occupancy rates by 60% in the Mediterranean and 60% in the Caribbean for all cruise lines, with a corresponding impact on passenger revenues and ports' variable expenses, based on the issued itineraries for the period 1 June 2020 to 31 March 2021. · A fall in marble exports in Port Akdeniz to China of 25% based on the forecasted container cargo of marble for both loading and unloading for the next 12 months. · Delay of dividend payments by the Group and individual ports for the next 12 months. Under this scenario the Group expects to have sufficient cash resources to remain in operation and remain within covenant requirements for a period of not less than 12 months from the date of approval of these Annual Report and Accounts. Management has also assessed the impact of the above scenario on the Group's covenants. Barcelona Ports Investments and Valetta Cruise Port Limited covenants are projected to remain above the required level. The Group's Eurobond has a consolidated leverage ratio limit of 5x which is only required to be calculated when there is a change in the ratio due to additional indebtedness or acquisition or disposals of entities within the sub-group of the Eurobond covenant perimeter. However, in order to stress test the financial position of the Group, management has also considered a plausible but, highly unlikely, severe downside scenario whereby the current passenger levels and commercial trade volumes due to the COVID-19 related circumstances persist for a period of 12 months. The following key, severe but plausible, assumptions were used in preparing this analysis: · A fall to zero in the number of cruise passengers arriving at all ports in the GPH portfolio for a period to 31 December 2020 with a corresponding impact on passenger revenues and ports' variable expenses. To be followed by a moderate return, remaining 50% below original forecast, of cruise passengers to our Caribbean ports only. · A fall in marble exports in Port Akdeniz to China of 75% based on the forecasted container cargo of marble for both loading and unloading until September 2020 followed by a moderate return, remaining at least 25% below original forecasts. · Delay of dividend payments by the Group and individual ports for the next 12 months. · Partial suspension of the capital investment in Nassau Cruise Port Limited forecasted for 2020 and 2021 amounting to a USD 10m reduction. Under this scenario the Group still expects to have sufficient cash resources and remain within covenant requirements for a period of not less than 12 months from the date of approval of these Annual Report and Accounts having taken into account: committed, undrawn credit lines, covenant waivers that have been received, and potential mitigating actions within the control of the Group including the application of a number of contractual Force Majeure clauses. In the circumstances of this severe downside scenario management are of the view that there may be a number of further mitigating actions that could be executed to reduce the depletion of cash resources but that are not within the control of Group at the date of approval of these Annual Report and Accounts and thus not included in the assessment. These includes being eligible for and receiving certain Governmental reliefs currently being discussed by various Governments and negotiated deferral or waiver of concession payments due to concessionaires. Management has also commenced discussions with a number of investment banks to assess several options for the Eurobond refinancing including but not limited to re-issuing a new Eurobond. With Port Akdeniz being a significant guarantor of the bond, the outcome of the Group's exclusive negotiations with a potential buyer of this port may have a material impact on the appropriate refinancing structure. A final decision on the sale process is expected in Q3 2020, after which the Group will pursue the most appropriate refinancing structure. So far considering the stage of these discussions, there is no indication that suggests that a refinancing cannot be obtained or an appropriate lender would not be found. The impact of COVID-19 has also been considered in relation to the Eurobond refinancing. Noting that the refinancing is only due by November 2021, Management does not currently expect any negative impact on its fundamental ability to secure financing by that time and has performed the Going Concern analysis on this basis. The Group has arranged the required finance for the investment requirements of GPH Antigua while for Nassau Cruise Port an initial bridge financing arrangement of $50m has been agreed which will cover the first year's requirements. (Note 13). The Group is not expecting any significant impact on its operations from the UK decision to leave the European Union. The directors have considered the information described herein and have a reasonable expectation that the Group and its subsidiaries have adequate resources to continue in operational existence. Thus, they continue to adopt the going concern basis of accounting in preparing the consolidated financial statements. 2) Segment reporting a) Products and services from which reportable segments derive their revenues ............................................................................. The Group operates various cruise and commercial ports and all revenue is generated from external customers such as cruise liners, ferries, yachts, individual passengers, container ships and bulk and general cargo ships. b) Reportable segments ...................... Operating segments are defined as components of an enterprise for which discrete financial information is available that is evaluated regularly by the chief operating decision-maker, in deciding how to allocate resources and assessing performance. The Group has identified two main segments as commercial and cruise businesses. Under each main segment, Group had presented its operations on port basis as an operating segment, as each port represents a set of activities which generates revenue and the financial information of each port is reviewed by the Group's
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chief operating decision-maker in deciding how to allocate resources and assess performance. Spanish Ports
are aggregated due to the Group's operational structure. The Group's chief operating decision-maker is the
Chief Executive Officer ("CEO"), who reviews the management reports of each port at least on a monthly
basis.
2) Segment reporting (continued)
b) Reportable segments (continued)
The CEO evaluates segmental performance on the basis of earnings before interest, tax, depreciation and
amortisation excluding the effects of specific adjusting income and expenses comprising project expenses,
bargain purchase gains and reserves, board member leaving fees, employee termination payments, unallocated
expenses, finance income, finance costs, and including the share of equity-accounted investments which is
fully integrated into GPH cruise port network ("Adjusted EBITDA" or "Segmental EBITDA"). Adjusted EBITDA
is considered by Group management to be the most appropriate profit measure for the review of the segment
operations because it excludes items which the Group does not consider to represent the operating cash
flows generated by underlying business performance. The share of equity-accounted investees has been
included as it is considered to represent operating cash flows generated by the Group's operations that
are structured in this manner.
The Group has the following operating segments under IFRS 8:
· BPI ("Creuers" or "Creuers (Barcelona and Málaga)"), VCP ("Valetta Cruise Port"), Ege Liman ("Ege
Ports-Kusadasi"), Bodrum Liman ("Bodrum Cruise Port"), Ortadogu Liman (Cruise port operations), POH,
Nassau Cruise Port ("NCP"), Antigua Cruise Port ("GPH Antigua"), Lisbon Cruise Terminals, SATS - Creuers
Cruise Services Pte. Ltd. ("Singapore Port"), Venezia
Investimenti Srl. ("Venice Investment" or "Venice Cruise Port") and La Spezia Cruise Facility Srl. ("La
Spezia") which fall under the Group's cruise port operations.
· Ortadogu Liman (Commercial port operations) ("Port Akdeniz-Antalya") and Port of Adria ("Port of
Adria-Bar") which both fall under the Group's commercial port operations.
The Group's reportable segments under IFRS 8 are BPI, VCP, Ege Liman, Nassau Cruise Port, Ortadogu Liman
(Commercial port operations) and Port of Adria (Commercial port operations).
Bodrum Cruise Port, Italian Ports, Ortadogu Liman (Cruise operations), Port of Adria (Cruise Operations),
and GPH Antigua, [that just started its operations at the end of 2019] are not exceeding the quantitative
threshold, have been included in Other Cruise Ports.
Global Depolama does not generate any revenues and therefore is presented as unallocated to reconcile to
the consolidated financial statements results.
Assets, revenue and expenses directly attributable to segments are reported under each reportable segment.
Any items which are not attributable to segments have been disclosed as unallocated.
The Group has initially applied IFRS 16 at 1 January 2019, using the modified retrospective approach.
Under this approach, comparative information is not restated (see Note 2). In order to account for the
application of IFRS 16, management has presented as separate reconciling items the impact of IFRS 16 on
segmental and adjusted EBITDA, segment assets, segment liabilities, depreciation, finance costs.
As a result, the Group recognised USD 82,381 thousand of right-of-use assets and USD 64,828 thousand of
liabilities from those lease contracts. These assets and liabilities are included in BPI, VCP, Other
Cruise Ports, Ortadogu Liman and Port of Adria segments as at 31 December 2019. The Group recognises
depreciation and interest costs, instead of operating lease expense (see Note 2a). During the year ended
31 December 2019, in relation to those leases, the Group recognised USD 2,319 thousand of depreciation
charges and USD 2,385 thousand of additional interest costs from leases.
2 Segment reporting (continued)
b) Reportable segments (continued)
i) Segment revenues, results and reconciliation to profit before tax
The following is an analysis of the Group's revenue, results and reconciliation to profit before tax by
reportable segment:
Nassau Other
Cruise Cruis
Port e
Ports
Ege Total Ortadogu Port Total
Lim Cruis of Comme
an e Adri rcial
a
USD '000 BPI VCP Liman Total
31 December
2019
Revenue 31, 13, 6,5 2,492 8,855 63,04 47,486 7,35 54,83 117,8
278 872 49 6 2 8 84
Segmental 20, 8,0 4,5 1,808 9,478 44,36 37,369 1,70 39,07 83,44
EBITDA 461 27 90 4 8 7 1
- Segmental 19, 7,1 4,5 1,808 8,879 42,03 37,306 1,12 38,42 80,46
EBITDA pre 564 94 90 5 0 6 1
IFRS 16
- IFRS 16 897 833 -- -- 599 2,329 63 588 651 2,980
impact on
Segmental
EBITDA
Unallocated (6,42
expenses 6)
Adjusted 77,01
EBITDA 5
- IFRS 16 impact on Adjusted EBITDA 224
Reconciliation
to profit
before tax
(47,7
37)
Depreciation
and
amortisation
expenses
- IFRS 16 impact on depreciation and amortization (2,44
expenses 1)
Specific (8,39
adjusting 1)
items (*)
Finance income 8,082
Finance costs (42,3
33)
- IFRS 16 impact on finance costs (2,38
5)
Profit before income tax (13,3
64)
31 December
2018
Revenue 31, 13, 4,6 -- 5,670 54,91 59,887 10,0 69,89 124,8
577 017 50 4 11 8 12
Segmental 19, 6,3 3,0 -- 8,331 37,60 49,184 3,92 53,11 90,71
EBITDA 793 99 84 7 8 2 9
Unallocated (7,00
expenses 5)
Adjusted 83,71
EBITDA 4
Reconciliation
to profit
before tax
Depreciation (44,6
and 68)
amortisation
expenses
Specific 2,482
adjusting
items (*)
Finance income 27,95
5
Finance costs (60,8
67)
Profit before 8,616
income tax
(*) Please refer to glossary of alternative performance measures (APM).
The Group did not have inter-segment revenues in any of the periods shown above.
2 Segment reporting (continued)
b) Reportable segments (continued)
ii) Segment assets and liabilities
The following is an analysis of the Group's assets and liabilities by reportable segment for the years
ended:
Nassau Other
Ege Cruise Cruise Ortadogu Port Total
Lim Port Ports of Comme
an Adri rcial
a
USD '000 BPI VCP Total Liman Total
Cruis
e
31 December 2019
745,0
76
Segment assets 151 117 46, 79,794 44,994 440,4 231,789 72,8 304,6
,93 ,43 283 43 44 33
8 4
- Right-of-use 11, 21, -- -- 39,123 72,52 49 7,91 7,966 80,48
assets 770 627 0 7 6
- Investment -- 2,1 -- -- -- 2,139 -- -- -- 2,139
property 39
Equity-accounted -- -- -- -- 26,637 26,63 -- -- -- 26,63
investees 7 7
Unallocated 23,16
assets 6
- Right-of-use assets 637
Total assets 794,8
79
Segment 68, 60, 9,9 79,583 41,930 260,4 72,367 38,4 110,8 371,2
liabilities 591 430 18 52 74 41 93
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- Lease 11, 25, -- -- 17,868 54,77 -- 9,40 9,408 64,18
liabilities 903 001 2 8 0
recognized under
IFRS 16
Unallocated 268,3
liabilities 23
- Lease 648
liabilities
recognized under
IFRS 16
Total 639,6
liabilities 16
31 December 2018
Segment assets 152 96, 48, -- 12,789 310,0 220,984 67,6 288,6 598,6
,34 756 117 03 72 56 59
1
Equity-accounted -- -- -- -- 26,003 26,00 -- -- -- 26,00
investees 3 3
Unallocated 63,32
assets 3
Total assets 687,9
85
Segment 66, 35, 13, -- 7,048 122,1 56,969 29,7 86,69 208,8
liabilities 652 248 202 50 25 4 44
Unallocated 263,4
liabilities 20
Total 472,2
liabilities 64
iii) Other segment information
The following table details other segment information for the years ended:
Nassau Other
Ege Cruise Cruise Total Ortadogu Port Total
Lim Port Ports Cruis of Comme
an e Adria rcial
USD '000 BPI VCP Liman Unallocated Total
31 December
2019
(377) (47,7
37)
Depreciation (11,6 (3,10 (2, (1,027 (3,705 (22,3 (21,832) (3,14 (24,9
and 96) 2) 857 ) ) 87) 1) 73)
amortisation )
expenses
- (738) (657) -- -- (438) (1,83 (68) (328) (396) (212) (2,44
Depreciation 3) 1)
of right of
use assets
recognised
under IFRS
16
Additions to
non-current
assets (*)
- Capital 1,571 1,615 46 7,850 7,903 18,98 3,311 1,596 4,907 76 23,96
expenditures 5 8
Total 1,571 1,615 46 7,850 7,903 18,98 3,311 1,596 4,907 76 23,96
additions to 5 8
non-current
assets (*)
31 December
2018
Depreciation (11,3 (2,59 (3, -- (3,359 (20,3 (21,342) (2,87 (24,2 (120) (44,6
and 50) 5) 027 ) 31) 5) 17) 68)
amortisation )
expenses
Additions to
non-current
assets (*)
- Capital 2,074 927 259 -- 2,361 5,621 4,761 3,443 8,204 982 14,80
expenditures 7
- Other -- -- -- -- -- -- -- -- -- -- --
Total 2,074 927 259 -- 2,361 5,621 4,761 3,443 8,204 982 14,80
additions to 7
non-current
assets (*)
(*) Non-current assets exclude those relating to deferred tax assets and financial instruments (including
equity-accounted investees).
iv) Geographical information
The Port operations of the Group are managed on a worldwide basis, but operational ports and management
offices are primarily in Turkey, Montenegro, Malta, Spain, Bahamas, Antigua&Barbuda and Italy. The
geographic information below analyses the Group's revenue and non-current assets by countries. In
presenting the following information, segment revenue has been based on the geographic location of port
operations and segment non-current assets were based on the geographic location of the assets.
As at 31 December As at 31 December
2019 2018
(USD '000) (USD '000)
Non-current assets
Turkey 222,615 243,224
Spain 129,114 129,695
Malta 115,467 94,703
Montenegro 70,080 65,202
Bahamas 69,213 --
Antigua & Barbuda 40,494 --
Italy 5,863 6,962
UK 7,474 12,048
Croatia 2,944 --
Unallocated 28,816 29,071
692,080 580,905
Non-current assets relating to deferred tax assets and financial instruments (including equity-accounted
investments) are presented as unallocated.
v) Information about major customers
The Group did not have a single customer that accounted for more than 10% of the Group's consolidated net
revenues in any of the periods presented.
3 Revenue
For the years ended 31 December, revenue comprised the following:
BPI VCP EP NC oth s Cruise Port Port of Commer Consoli
P er Akdeniz Adria cial dated
(USD 201 2018 201 2018 201 2018 20 2018 201 2018 201 2018 201 2018 201 2018 20 2018 201 2018
'000) 9 9 9 19 9 9 9 9 19 9
Point in
time
Container -- -- -- -- -- -- -- -- -- -- -- -- 29, 37,1 5,0 5,36 34 42,5 34, 42,5
revenue 259 58 90 0 ,3 18 349 18
49
Landing 26, 27,3 5,8 4,75 2,5 1,83 2, -- 4,5 3,14 42, 37,0 -- -- -- -- -- -- 42, 37,0
fees 829 56 52 4 85 8 45 81 4 297 92 297 92
0
Port 1,7 1,74 1,0 1,16 2,0 1,46 18 -- 570 746 5,4 5,11 9,9 12,1 229 282 10 12,4 15, 17,5
service 33 2 93 3 71 8 85 9 80 46 ,2 28 694 47
revenue 09
Cargo -- -- -- -- -- -- -- -- -- -- -- -- 3,8 9,30 1,5 3,37 5, 12,6 5,4 12,6
revenue 96 7 05 8 40 85 01 85
1
Domestic 406 695 -- -- 47 86 -- -- 20 34 473 815 29 35 15 19 44 54 517 869
water
sales
Income -- -- 4,0 4,03 -- -- -- -- -- -- 4,0 4,03 -- -- -- -- -- -- 4,0 4,03
from duty 01 0 01 0 01 0
free
operation
s
Other 351 -- 384 436 733 264 24 -- 1,0 454 2,5 1,15 3,6 589 -- 33 3, 622 6,1 1,77
revenue 70 62 4 36 63 98 6
6
Over time
Rental 1,9 1,78 2,5 2,63 1,1 994 -- -- 996 713 6,6 6,12 686 653 513 938 1, 1,59 7,8 7,71
income 59 4 42 4 13 10 5 19 1 09 6
9
Habana -- -- -- -- -- -- -- -- 1,6 579 1,6 579 -- -- -- -- -- -- 1,6 579
Managemen 18 18 18
t fee
Total 31, 31,5 13, 13,0 6,5 4,65 2, -- 8,8 5,67 63, 54,9 47, 59,8 7,3 10,0 54 69,8 117 124,
278 77 872 17 49 0 49 55 0 046 14 486 88 52 10 ,8 98 ,88 812
2 38 4
The following table provides information about receivables, contract assets and contract liabilities from
contracts with customers;
Year ended 31 Year ended 31
December 2019 December 2018
(USD '000) (USD '000)
Revenue
Receivables, which are 19,195 12,129
included in 'trade and
other receivables'
Contract assets 1,765 797
Contract liabilities (967) (990)
19,993 11,936
The contract assets primarily relate to the Group's rights to consideration for work completed but not
billed at the reporting date on Commercial services provided to vessels and management agreements. The
contract assets are transferred to receivables when the rights become unconditional. This occurs when the
Group issues an invoice to the customer.
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The contract liabilities primarily relate to the advance consideration received from customers for
services not yet been provided. These amounts will be recognised as revenue when the services has provided
to customers and billed, which was based on the nature of the business less than one week period.
The amount of $654 thousand recognised in contract liabilities at the beginning of the period has been
recognised as revenue for the period ended 31 December 2019.
The amount of revenue recognised in the period ended 31 December 2019 from performance obligations
satisfied (or partially satisfied) in previous periods is $797 thousand. This is mainly due to the nature
of operations.
No information is provided about remaining performance obligations at 31 December 2019 that have an
original expected duration of one year or less, as allowed by IFRS 15.
4) Cost of sales
For the years ended 31 December, cost of sales comprised the following:
2019 2018
(USD '000) (USD '000)
Depreciation and amortization expenses 45,587 41,655
Personnel expenses * 16,418 14,228
Cost of inventories sold 2,884 2,453
Commission fees to government authorities
and pilotage expenses
2,289 3,716
Security expenses 3,168 2,627
Repair and maintenance expenses 1,827 1,923
Subcontractor lashing expenses 1,074 1,403
Subcontractor crane expenses 930 1,305
Replacement provision 673 677
Other expenses 5,034 7,536
Total 79,884 77,523
* 6,003 thousand USD (2018: 4,058 thousand USD) of total personnel expenses are related to outsourced
personnel expenses.
5 Administrative expenses
For the years ended 31 December, administrative expenses comprised the following:
2019 2018
(USD '000) (USD '000)
Personnel expenses 6,954 5,983
Depreciation and amortization expenses 2,145 3,013
Consultancy expenses 2,651 2,191
Representation and travel expenses 570 826
Other expenses 3,185 3,980
Total 15,505 15,993
6 Other income and other expenses
For the years ended 31 December, other income comprised the following:
2019 2018
USD'000 USD'000
Reversal of replacement for Spanish Ports (*) -- 12,210
Foreign currency income from operations 1,813 4,646
Income from reversal of withholding tax (**) -- 1,095
Insurance income 587 615
Gain on sale of fixed assets 17 145
Other 1,084 1,017
Total 3,501 19,728
(*) Reversal of replacement for Spanish Ports are related to an assumption change on provision.
(**) Income from reversal of withholding tax is related to cancellation of tax for distributed dividends
to foreign entities.
For the years ended 31 December, other expenses comprised the following:
2019 2018
USD'000 USD'000
Project expenses 5,146 9,594
Foreign currency losses from operations -- 1,523
Tax amnesty expenses -- 920
Recovery from insurance 346 496
Impairment losses on inventory 262 106
Provisions 1,203 34
Other 1,623 1,161
Total 8,580 13,834
7 Finance income and costs
For the years ended 31 December, finance income comprised the following:
2019 2018
Finance income (USD '000) (USD '000)
Other foreign exchange gains 6,065 26,271
Interest income on related parties -- 449
Interest income on banks and others 248 470
Interest income from housing loans 3 33
Interest income from debt instruments 1,766 --
Other income -- 732
Total 8,082 27,955
The income from financial instruments within the category financial assets at amortized cost is USD 251
thousand (31 December 2018: USD 952 thousand). Income from financial instruments within the category fair
value through profit and loss is 1,814 thousand (31 December 2018: nil).
For the years ended 31 December, finance costs comprised the following:
2019 2018
Finance costs (USD '000) (USD
'000)
Interest expense on loans and borrowings 26,077 25,005
Foreign exchange losses from Eurobond 5,222 17,552
Foreign exchange losses on loans and 3,956 1,321
borrowings
Interest expense on leases 2,434 192
Other foreign exchange losses * 2,584 15,371
Loan commission expenses 1,097 103
Unwinding of provisions during the year 355 303
Letter of guarantee commission expenses 215 158
Other interest expenses 235 17
Other costs 158 845
Total 42,333 60,867
* Port Akdeniz, Ege Ports and Bodrum Cruise Port have functional currency of USD while their books are
required to be kept as per Turkish Companies Law "VUK 213" article 215 in TL. All equity transactions are
made in TL and transaction incurred during the year are being translated to USD resulting to foreign
exchange differences on the profit or loss account.
The interest expense for financial liabilities not classified as fair value through profit or loss is
28,355 thousand (31 December 2018: USD 25,325 thousand).
8 Property and equipment
Movements of property and equipment for the year ended 31 December 2019 comprised the following:
USD '000
Currency
translation
differences
31
Dece
mber
Cost 1 Additions Disposals Transfers
Jan
uar 2019
y
201
9
Leasehold 122 2,597 (2) 4,431 (1,587) 127,
improvements ,48 921
2
Machinery 55, 1,147 (30) 227 (423) 56,0
and 159 80
equipment
Motor 17, 126 (6) -- (82) 17,8
vehicles 858 96
Furniture 9,6 1,931 (18) -- (242) 11,3
and fixtures 66 37
Construction 4,3 9,987 -- (4,658) 42 9,75
in progress 88 9
Land 67 25 -- -- -- 92
improvement
Total 209 15,813 (56) -- (2,292) 223,
,62 085
0
Currency
translation
Accumulated 1 Depreciation Disposals Transfers 31
depreciation Jan differences Dece
uar mber
y
201 expense
9
2019
Leasehold 33, 6,022 -- -- (170) 39,4
improvements 586 38
Machinery 30, 4,385 (31) (6) (104) 34,5
and 326 70
equipment
Motor 10, 1,386 -- 6 (2) 11,4
vehicles 041 31
Furniture 6,2 859 (6) -- (38) 7,09
and fixtures 78 3
Land 38 4 -- -- -- 42
improvement
Total 80, 12,656 (37) -- (314) 92,5
269 74
Net book 129 130,
value ,35 511
1
8 Property and equipment (continued)
Movements of property and equipment for the year ended 31 December 2018 comprised the following:
USD '000
Currency
translation
differences
31
Dece
mber
Cost 1 Additions Disposals Transfers
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Jan
uar 2018
y
201
8
Leasehold 121 2,358 (62) 2,955 (4,459) 122,
improvements ,69 482
0
Machinery 53, 2,925 (167) 22 (848) 55,1
and 227 59
equipment
Motor 18, 111 (327) 4 (523) 17,8
vehicles 593 58
Furniture 9,2 932 (1) 71 (602) 9,66
and fixtures 66 6
Construction 1,5 5,570 -- (2,709) (69) 4,38
in progress 96 8
Land 151 -- -- (81) (3) 67
improvement
Total 204 11,896 (557) 262 (6,504) 209,
,52 620
3
Currency
translation
Accumulated 1 Depreciation Disposals Transfers 31
depreciation Jan differences Dece
uar mber
y
201 expense
8
2018
Leasehold 28, 5,657 -- 922 (1,073) 33,5
improvements 080 86
Machinery 26, 4,208 (158) 250 (215) 30,3
and 241 26
equipment
Motor 9,1 1,485 (328) -- (257) 10,0
vehicles 41 41
Furniture 5,4 1,012 (1) (1) (185) 6,27
and fixtures 53 8
Land 944 5 -- (909) (2) 38
improvement
Total 69, 12,367 (487) 262 (1,732) 80,2
859 69
Net book 134 129,
value ,66 351
4
Global Ports Holding PLC and its Subsidiaries
*********************************************
Notes to the consolidated financial statements (continued)
8) Property and equipment (continued)
As at 31 December 2019, the net book value of machinery and equipment purchased through leasing amounts to
USD 1,511 thousand (31 December 2018: USD 1,689 thousand), the net book value of motor vehicles purchased
through leasing amounts to USD 6,810 thousand (31 December 2018: USD 7,991 thousand), and the net book
value of furniture and fixtures purchased through leasing amounts to USD 7 thousand (31 December 2018: USD
45 thousand). In 2019, no capital expenditure was made through finance leases (31 December 2018: nil).
As at 31 December 2019 and 2018, according to the "TOORA" and "BOT" tender agreements signed with the
related Authorities, at the end of the agreement periods, real estate with their capital improvements will
be returned as running, clean, free of any liability and free of charge.
For the years ended 31 December 2019 and 2018, there are no borrowing costs capitalised into property and
equipment.
As at 31 December 2019, the insured amount of property and equipment amounts to USD 295,721 thousand (31
December 2018: USD 326,671 thousand).
9 Intangible assets
Movements of intangible assets for the year ended 31 December 2019 comprised the following:
USD '000
Currency
translation
differences
1 31
Janu Dece
ary mber
Cost Additions Disposals Transfers
2019 2019
Port 605, 70,028 (393) -- (6,174) 668,
operation 115 576
rights
Customer 3,93 -- -- -- -- 3,93
7 7
relationships
Software 1,26 88 -- -- (13) 1,34
8 3
Other 713 58 -- -- (65) 706
intangibles
Total 611, 70,174 (393) -- (6,252) 674,
033 562
Accumulated Currency
amortisation translation
1 Amortisation Disposals Transfers 31
Janu differences Dece
ary mber
expense
2019 2019
Port 214, 32,012 (79) 7 (1,245) 244,
operation 227 922
rights
Customer 3,36 328 -- -- -- 3,69
relationships 5 3
Software 646 156 -- -- (5) 797
Other 434 144 -- (7) (39) 532
intangibles
Total 218, 32,640 (79) -- (1,289) 249,
672 944
Net book 392, 424,
value 361 618
Movements of intangible assets for the year ended 31 December 2018 comprised the following:
USD '000
Currency
translation
1 31
Janu differences Dece
ary mber
Cost Additions Disposals Transfers
2018 2018
Port 616, 2,068 (23) -- (13,341) 605,
operation 411 115
rights
Customer 4,11 -- -- -- (176) 3,93
relationships 3 7
Software 1,15 140 (3) -- (24) 1,26
5 8
Other 889 703 -- -- (879) 713
intangibles
Total 622, 2,911 (26) -- (14,420) 611,
568 033
Currency
Accumulated 1 Amortisation Disposals Transfers translation 31
amortisation Janu differences Dece
ary mber
expense
2018 2018
Port 185, 31,648 -- -- (2,873) 214,
operation 452 227
rights
Customer 3,17 337 -- -- (145) 3,36
3 5
relationships
Software 492 164 (3) -- (7) 646
Other 376 152 -- -- (94) 434
intangibles
Total 189, 32,301 (3) -- (3,119) 218,
493 672
Net book 433, 392,
value 075 361
The details of Port operation rights for the years ended 31 December 2019 and 2018 are as follows:
As at 31 December 2019 As at 31 December 2018
Remaining Remaining
Amortisati Amortisation
on Period Period
Carrying Carrying Amount
Amount
USD '000
Creuers del 100,336 126 months 112,652 138 months
Port de
Barcelona
Cruceros 11,400 152 months 12,300 164 months
Malaga
Valletta 61,299 563 months 64,072 575 months
Cruise Port
Port of 19,623 288 months 20,919 300 months
Adria
Port 144,198 104 months 160,798 116 months
Akdeniz
Ege Ports 11,240 159 months 12,079 171 months
Bodrum 2,657 579 months 2,446 591 months
Cruise Port
Nassau 68,488 332 months -- --
Cruise Port
Cagliari 2,201 84 months 2,889 96 months
Cruise Port
Catania 2,173 96 months 2,514 108 months
Cruise Port
Ravenna 39 12 months 220 24 months
Cruise Port
All port operating rights have arisen as a result of IFRS 3 Business combinations, except Barcelona Port
Investments, Ravenna Cruise Port, Catania Cruise Port and Nassau Cruise Port, which arose as a result of
applying IFRIC 12. Each port represent a separate CGU as per IAS 36.
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Port operating rights of Nassau have been created by discounted cash outflows of fixed payments related to
the future concession fees payable to the government and future payments to local organization (in
substance payments to obtain the rights) in accordance with the concession agreement. The discount rate
used is a risk-adjusted rate that matches the duration of concession term and currency of the cash flows.
As these payments are contractually agreed, an equivalent long-term financial liability of USD 48,083
thousand, short term financial liability of USD 4,079 thousand has been created
Project expenses directly attributable to the creation of the port right of USD 7,125 have also been
capitalized as part of the port operating rights.
Recoverability of intangible assets
The recoverable amount of the CGU relating to the Port Akdeniz was based on its value in use, determined
by discounting the estimated future cash flows to be generated from the continuing use of the CGU. The
carrying amount of the CGU was determined to be lower than its recoverable amount of USD 226 million and
no impairment loss during 2019 (2018: nil) was recognised.
The key assumptions are the expected growth rate in container volume of the port and the discount rate
used. Cash flows used to calculate value-in-use are prepared in USD. A post-tax discount rate of 11.24%
was used for discounting future cash flows to the reporting date. The growth in container operations was
forecasted at 2.2% average per annum until end of concession. General Cargo has been assumed to recover
back to 2017 levels in 2023 and no growth has been forecasted for the remaining life of concession. 9
years of cash flows were included instead of 5 years plus terminal value as the life of the rights
determined in the concession agreement. The growth is forecasted based on the historical information,
management knowledge on the business and meetings made with customers for 2020. Future growth expectations
forecasted based on the average growth rate expectation of containerized products and Country growth
forecast made by World Bank.
The cash flow model is constructed on a post-tax basis and the discount rate used is post-tax. An
equivalent pre-tax discount rate would be 14.8%.
The estimated recoverable amount of the CGU exceeded its carrying amount by approximately USD 55.1m.
Management has not identified any reasonably possible change in the number of container cargo or the
discount rate that could cause the carrying amount to exceed the recoverable amount.
The low performance in Port of Adria is related to non-recurring project-based revenues in 2018 which was
subsequently discontinued in early 2019. When these revenues are being excluded, core operations showed a
better performing year compared to last year.
10 Equity-accounted investments
The nature of the operations and the locations of the equity-accounted investees of the Company are listed
below:
Equity-accounted investees Locations Operations
LCT - Lisbon Cruise Terminals, LDA Portugal Port operations
SATS - Creuers Cruise Services Pte. Singapore Port operations
Ltd. ("Singapore Port")
Venezia Investimenti Srl. ("Venice Italy Port investments
Investment")
Goulette Cruise Holding ("Goulette") UK Port investments
La Spezia Cruise Facility Srl. ("La Italy Port operations
Spezia")
Lisbon Cruise Terminals
The Group has entered into the concession agreement of Lisbon Cruise Port within the framework of a
public-service concession on 18 July 2014 as a part of the consortium comprising Global Liman, RCCL,
Creuers and Group Sousa
- Investimentos SGPS, LDA. The operation right of Lisbon Cruise Port has been transferred by the Port
Authority of Lisbon to LCT-Lisbon Cruise Terminals, LDA, which was established by the Consortium on 26
August 2014. The Group has a 46.2% effective interest in Lisbon Cruise Terminals as at 31 December 2019,
hence the Group can only appoint a minority of Directors to the Board and therefore does not have control
over the Entity. Lisbon Cruise Terminals has been recognised as an equity-accounted investee in the
consolidated financial report as at and for the years ended 31 December 2019 and 2018.
Singapore Port
Barcelona Port Investments, S.L ("BPI") was established as a joint venture between the Group and Royal
Caribbean Cruises Ltd. ("RCCL") on 26 July 2013 for the purpose of acquiring Creuers. Global Liman has 62%
ownership in BPI. Creuers holds a 100% interest in the port operation rights for the Barcelona cruise
port, as well as an 80% interest in the port operation rights for the Malaga cruise port and a 40%
interest in the port operation rights for the Singapore cruise port. The entity has a fiscal year starting
from 1 April and ending on 31 March. The entity's financial results are aligned to the Group's fiscal year
to account for under the scope of IAS 28. The effective interest held on Singapore cruise port is 24.8%.
Singapore has been recognised as an equity-accounted investee in the consolidated financial report as at
and for the years ended 31 December 2019 and 2018.
Venice Investment
Venezia Investimenti Srl is an international consortium formed for investing in Venezia Terminal Passegeri
S.p.A ("VTP"). The international consortium formed as a joint venture by GPH, Costa Crociere SpA, MSC
Cruises SA and Royal Caribbean Cruises Ltd each having a 25% share of the Company.
Goulette Cruise Holding
Goulette Cruise Holding is a joint venture established 50%-50% between the Company and MSC Cruises S.A.
("MSC"), to acquire La Goulette Shipping Cruise, which operates the cruise terminal in La Goulette,
Tunisia. The Company made a share capital contribution for its 50% shareholding amounting to EUR 55
thousand and issued a loan of $6m in December 2019 to fund the acquisition of La Goulette Shipping Cruise
proportionately to its share. The joint venture acquired the shares in La Goulette Shipping Cruise on 26
December 2019.
La Spezia
GPH purchased a minority interest of 28.5% through POH in La Spezia Cruise Facility Srl, which has the
operating rights of La Spezia Cruise Port, Italy.
For the year ended 31 December 2019
...................................
At 31 December 2019, La Spezia, Venezia Investimenti, Lisbon Cruise Terminals and Singapore Port are
equity- accounted investees in which the Group participates.
The following table summarises the financial information of La Spezia, Goulette Cruise Holding, Venezia
Investimenti, Lisbon Cruise Terminals and Singapore Port as included in the consolidated financial
statements as at 31 December 2019. The table also reconciles the summarised financial information to the
carrying amount of the Group's interest in Lisbon Cruise Terminals and Singapore Port.
Goulette Venezia Lisbon
Cruise Investi Cruise
Holding menti Terminals
(USD'00
La 0) Singapore
Spezia
(USD'00 (USD'000) (USD'000)
0)
Port
(USD'000)
Percentage 30.00% 50.00% 25.00% 50.00% 40.00%
ownership
interest
Non-current -- 13,536 34,274 29,465 7,141
assets
Current 24 246 5,020 6,484 19,272
assets
Non-current -- (13,659) -- (13,569) (2,846)
liabilities
Current -- -- (37) (3,476) (5,312)
liabilities
Net assets 24 123 39,257 18,904 18,255
(100%)
Group's share 7 62 9,814 9,452 7,302
of net assets
Carrying 7 62 9,814 9,452 7,302
amount of
interest in
equity-
accounted
investees
Revenue -- -- 3,053 7,832 28,490
Expenses -- -- (925) (6,340) (17,735)
Profit and -- -- 2,128 1,492 10,755
total
comprehensive
income for
the year
(100%)
Group's share -- -- 532 746 4,302
of profit and
total
comprehensive
income
As at 31 December 2019, the amounts in the above table include the following:
Goulette Venezia Lisbon
Cruise Investime Cruise
Holding nti Terminals
(USD'000)
Singapore
(USD'000) (USD'000)
USD '000 La Port (USD
Spez 000)
ia
(USD
'000
)
Cash and cash 24 246 5,000 3,193 2,763
equivalents
Non-current -- 13,659 -- (13,569) (2,403)
financial
liabilities
(excluding
trade and
other
payables and
provisions)
Current -- -- -- (934) (337)
financial
liabilities
(excluding
trade and
other
payables and
provisions)
Interest -- -- -- -- 74
income
Depreciation -- -- (2) (1,260) (1,885)
and
amortisation
Interest -- -- -- (456) --
expense
Income tax -- -- -- (444) (2,615)
expense
For the year ended 31 December 2019, the Group's share of profit and total comprehensive income is set out
below:
Net profit
(USD '000)
Venezia Investimenti 532
Lisbon Cruise Terminals 746
Singapore Port 4,302
Group's share of profit and total comprehensive income 5,580
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For the year ended 31 December 2018
...................................
At 31 December 2018, La Spezia, Venezia Investimenti, Lisbon Cruise Terminals and Singapore Port are
equity- accounted investees in which the Group participates.
The following table summarises the financial information of La Spezia, Venezia Investimenti, Lisbon Cruise
Terminals and Singapore Port as included in the consolidated financial statements as at 31 December 2018.
The table also reconciles the summarised financial information to the carrying amount of the Group's
interest in Lisbon Cruise Terminals and Singapore Port.
Venezia Lisbon
Investimen Cruise
ti (USD Terminal
'000) s
La Spezia (USD '000) Singapore
(USD
'000) Port (USD
'000)
Percentage 30.00% 25.00% 50.00% 40.00%
ownership interest
Non-current assets -- 35,082 30,307 3,370
Current assets 134 2,967 5,990 21,858
Non-current -- -- (14,843) --
liabilities
Current liabilities -- 51 (3,487) (6,591)
Net assets (100%) 134 38,100 17,967 18,637
Group's share of 40 9,525 8,983 7,455
net assets
Carrying amount of
interest in
equity-accounted
investees
40 9,525 8,983 7,455
Revenue -- 808 6,255 28,743
Expenses -- (106) (4,800) (16,924)
Profit and total
comprehensive
income for the year
-- 702 1,455 11,819
(100%)
Group's share of
profit and total
comprehensive
income
-- 176 728 4,727
As at 31 December 2018, the amounts in the above table include the following:
Venezia Lisbon
Investiment Cruise
i (USD Terminals
'000)
La Spezia Singapore
(USD '000)
USD '000 (USD Port (USD
'000) '000)
Cash and cash 134 2,899 1,807 8,380
equivalents
Non-current -- -- (14,843) --
financial
liabilities
(excluding trade
and other
payables and
provisions)
Current -- -- (874) --
financial
liabilities
(excluding trade
and
other payables
and provisions)
Interest income -- -- -- (40)
Depreciation and -- (2) (1,253) (806)
amortisation
Interest expense -- -- (490) --
Interest tax -- -- (437) (2,363)
expense
For the year ended 31 December 2018, the Group's share of profit and total comprehensive income is set out
below:
Net profit
(USD '000)
Venezia Investimenti 176
Lisbon Cruise Terminals 728
Singapore Port 4,727
Group's share of profit and total comprehensive income 5,631
11 Cash and cash equivalents
As at 31 December, cash and cash equivalents comprised the following:
2019 2018
(USD '000) (USD '000)
Cash on hand 132 63
Cash at banks 63,601 79,766
- Demand deposits 39,288 52,548
- Time deposits 17,815 27,218
- Overnight deposits 6,498 --
Other cash and cash equivalents 47
Cash and cash equivalents 63,780 79,829
As at 31 December, maturities of time deposits comprised the following:
2019 2018
(USD '000) (USD '000)
Up to 1 month 23,248 26,750
1-3 months 1,065 468
Total 24,313 27,218
As at 31 December, the ranges of interest rates for time deposits are as follows:
2019 2018
Interest rate for time deposit-TL (highest) 9.0% 21.5%
Interest rate for time deposit-TL (lowest) 8.0% 19.75%
Interest rate for time deposit-USD (highest) 1.9% 3.17%
Interest rate for time deposit-USD (lowest) 1.3% 1.5%
Interest rate for time deposit-EUR (highest) 0.01% N/A
Interest rate for time deposit-EUR (lowest) 0.15% N/A
As at 31 December 2019, cash at bank held at BPI, Port Akdeniz, Ege and Port of Adria amounting to USD
5,672 thousand (31 December 2018: USD 7,475 thousand) is restricted due to the bank loan guarantees and
subscription guarantees (Note 13). Bank loan guarantees were given for the following period's interest and
principal payment, and can be used when requested for investment purposes.
The Group's exposure to interest rate risk and sensitivity analysis for financial assets and liabilities
is disclosed in Note 31 of the Annual report and financial statements.
12 Capital and reserves
a) Share capital
................
The Company's shares are ordinary voting shares. There are no preferential rights attached to any shares
of the Company.
The details of paid up share capital as of 31 December are as follows:
Number of Share Share
shares capital Premium
'000 USD'000 USD'000
Balance at 1 January 2018 62,827 811 --
Balance at 31 December 2018 62,827 811 --
Balance at 31 December 2019 62,827 811 --
b) Nature and purpose of reserves
.................................
i) Translation reserves
The translation reserves amounting to USD 213,715 thousand (31 December 2018: USD 197,247 thousand) are
recognised as a separate account under equity and comprises foreign exchange differences arising from the
translation of the consolidated financial statements of subsidiaries and equity-accounted investees from
their functional currencies (of Euro and TL) to the presentation currency, USD.
ii) Legal reserves
Under the Turkish Commercial Code, Turkish companies are required to set aside first and second level
legal reserves out of their profits. First level legal reserves are set aside as up to 5% of the
distributable income per the statutory accounts each year. The ceiling of the first level reserves is 20%
of the paid-up share capital. The requirement to set aside ends when the 20% of the paid-up capital level
has been reached. Second level legal reserves correspond to 10% of profit distributed after the deduction
of the first legal reserves and the minimum obligatory dividend pay-out, but holding companies are not
subject to this regulation. There is no ceiling for second level legal reserves and they are accumulated
every year. First and second level legal reserves cannot be distributed until they exceed 50% of the
capital, but the reserves can be used for offsetting the losses in case free reserves are unavailable. As
at 31 December 2019, the legal reserves of the Group amounted to USD 13,144 (31 December 2018: USD 13,030
thousand).
iii) Hedging reserves Net investment hedge
In the year ended 31 December 2019, the Company has used its US Dollar Eurobond financing in a net
investment hedge of the US Dollar net assets of Port Akdeniz, Ege Port and Bodrum Cruise Port (31 December
2018: the Company has used its US Dollar Eurobond financing in a net investment hedge of the US Dollar net
asset of Port Akdeniz). Starting from 1 January 2019, Ege Port and Bodrum Cruise Port were added to the US
Dollar denominated assets with the change in their functional currency as described in Note 3(g) of the
Annual report and financial statements. A foreign exchange loss recognised in other comprehensive income
as a result of net investment hedging was USD 24,725 thousand (2018: loss USD 59,630 thousand).
Cash flow hedge
The Group entered into an interest rate swap in order to hedge its position against changes in interest
rates. The effective portion of the cash flow hedge that was recognised in other comprehensive income was
USD 335 thousand loss (31 December 2018, USD 155 thousand loss). The amount that was reclassified from
equity to profit and loss within the cash flow hedges - effective portion of changes in fair value line
item for the year was USD 246 thousand (31 December 2018, USD 216 thousand) recognized at financial
expenses on profit and loss statement.
The hedge instrument payments will be made in the periods shown below, at which time the amount deferred
in equity will be reclassified to profit and loss:
More than 3 5 years or
less
3 months months but but more More than
less than
or less than 1 year 1 year 5 years
(USD (USD '000) (USD '000) (USD '000)
'000)
Net cash outflows
exposure
Liabilities -- 220 265 --
At 31 December -- 220 265 --
2019
Net cash outflows
exposure
Liabilities -- 235 431 --
At 31 December -- 235 431 --
2018
b) Nature and purpose of reserves (continued)
iv) Merger reserves
On 17 May 2017, Global Ports Holding PLC was listed on the Standard Listing segment of the Official List
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and trading on the Main Market of the London Stock Exchange. As part of a restructuring accompanying the
Initial Public Offering ("IPO") of the Group on 17 May 2017, Global Ports Holding PLC replaced Global
Liman Isletmeleri
A.S. as the Group's parent company by way of a Share exchange agreement. Under IFRS 3 this has been
accounted for as a Group reconstruction under merger accounting. These consolidated financial statements
have been prepared as a continuation of the existing Group. Merger accounting principles for this
combination have given rise to a merger reserve of $225m. This has been transferred from the merger
reserve to retained earnings subsequent to the share capital reduction, as it does not have any features
distinct from retained earnings.
c) Dividends
............
Dividend distribution declarations are made by the Company in GBP and paid in USD in accordance with its
articles of association, after deducting taxes and setting aside the legal reserves as discussed above.
GPH PLC proposed and paid a 2019 interim dividend of GBP 0.155 per share to its shareholders, giving a
distribution of GBP 9,738 thousand (USD 12,580 thousand).
GPH PLC declared 2018 final dividend of GBP 0.212 per share to its shareholders on 24 May 2019 and paid on
5 July 2019, giving a distribution of GBP 13,319 thousand (USD 16,645 thousand).
The total dividends in respect of the year ended 31 December 2019 were USD 29,225 thousand.
GPH PLC declared on 13 August 2018 and paid on 26 October 2018, a 2018 interim dividend of GBP 0.215 per
share to its shareholders, giving a distribution of GBP 13,571 thousand (USD 17,710 thousand).
GPH PLC declared 2017 final dividend of GBP 0.201 per share to its shareholders on 12 March 2018 and paid
on 9 May 2018, giving a distribution of GBP 12,628 thousand (USD 17,132 thousand).
The total dividends in respect of the year ended 31 December 2018 were USD 34,843 thousand
Dividends to non-controlling interests totalled USD 6,366 in 2019 (2018: 3,797) and comprised a
distribution of USD 2,550 thousand (2018: USD 1,320 thousand) made to other shareholders by Valletta
Cruise Port and USD 1,264 paid in cash, a distribution of USD 65 thousand (2018: none) made to other
shareholders by Cagliari Cruise Port no cash settlement, and a distribution of USD 3,751 thousand (2018:
USD 2,477) made to other shareholders by Barcelona Port Investments fully paid in cash.
Events after the reporting period
The Board of the Company has decided to temporarily suspend the dividend for full year 2019, until the
situation related to spread of Covid-19 ("coronavirus") becomes clearer.
13 Loans and borrowings
As at 31 December, loans and borrowings comprised the following:
2019 2018
Current loans and borrowings (USD '000) (USD '000)
Current portion of Eurobond issued 18,554 18,558
Current bank loans 12,497 12,031
- TL 3,632 --
- Other currencies 8,865 12,031
Current portion of long-term bank loans 29,899 16,853
- TL 822 575
- Other currencies 29,077 16,278
Lease obligations 1,741 1,313
Finance leases 622 1,313
Lease obligations recognized under IFRS 16 1,119 --
Total 62,691 48,755
As at 31 December, the maturity profile of long-term bank loans comprised the following:
2019 2018
Year (USD '000) (USD '000)
Between 1-2 years 270,997 34,122
Between 2-3 years 11,463 225,086
Between 3-4 years 9,130 11,259
Over 4 years 35,002 27,237
Total 326,592 297,704
As at 31 December, the maturity profile of lease obligations comprised the following:
USD '000 2019 2018
Present Present
value of value of
minimum minimum
Future Future
minimum minimum
lease lease
payments payments
lease lease
payments payments
Interest Interest
Less than 3,646 (1,905) 1,741 1,382 (69) 1,313
one year
Between 142,638 (78,931) 63,707 637 (45) 592
one and
five
years
Total 146,284 (80,836) 65,448 2,019 (114) 1,905
As at 31 December 2019
Loans and Company Currency Maturity Interest Interest Principal Carrying
borrowing name type rate % value
s type
Loans used to finance investments and projects
Unsecured Global USD 2021 Fixed 8.13 250,000 250,989
Eurobonds Liman
(i)
Secured Barcelona EUR 2023 Floating Euribor 18,224 17,857
Loan (ii) Port + 4.00
Investmen
ts
Secured Malaga EUR 2025 Floating Euribor 4,467 4,437
Loan Cruise 3m +
(iii) Port 1.75
Secured Valetta EUR 2026 Floating Euribor 10,295 9,162
Loan (iv) Cruise + 2.80
Port
Secured Global BV EUR 2020 Floating Euribor 5,430 5,441
Loan (v) + 4.60
Secured Cagliari EUR 2026 Fixed 2.20 - 564 564
Loan Cruise 6.20
Port
Secured Bodrum TL 2020 Fixed 17.0 - 513 594
Loan Cruise 27.5
Port
Secured Port of EUR 2025 Floating Euribor 22,392 22,551
Loan (vi) Adria + 4.25
Secured Port of EUR 2019 Fixed 3.85 840 842
Loan Adria
Secured Ortadogu TL 2020 Fixed 14.50 339 339
Loan Liman
Secured Ortadogu USD 2020 Fixed 3.60 - 1,401 1,401
Loan Liman 6.60
Secured Ortadogu EUR 2020 Fixed 3.40 - 533 535
Loan Liman 6.00
Secured Barcelona EUR 2024 Floating EURIBOR 2,686 2,651
Loan Cruise + 4.00
Port
Secured Nassau USD 2021 Fixed 4.5 16,000 16,000
Loan (ix) Cruise
Port
Secured Antigua USD 2026 Floating LIBOR + 16,104 15,197
Loan (x) Cruise 5,75
Port
349,788 348,560
Loans
used to
finance
working
capital
Unsecured Global TL 2020 Fixed 26.34 2,694 2,701
Loan Liman
Unsecured Ege Liman USD 2020 Fixed 4.95 1,500 1,511
Loan
Unsecured Ege Liman EUR 2020 Fixed 3.54 2,377 2,437
Loan
Unsecured Ege Liman TL 2020 - Fixed 15.84 - 534 509
Loan 2021 30.6
Secured Ortadogu EUR 2020 Fixed 3.80 - 20,849 21,025
Loan Liman 8.75
Secured Ortadogu USD 2020 Fixed 3.80 - 10,289 10,478
Loan Liman 8.75
Secured Ortadogu TL 2020 Fixed 26 320 321
Loan Liman
38,563 38,982
Finance
lease
obligatio
ns
Leasing Ortadogu USD 2020 Fixed 7.35 186 186
(vii) Liman
Leasing Cagliari EUR 2021 Fixed 1.96 45 44
Cruise
Port
Leasing Ege Liman USD 2020 Fixed 7.75 1 1
Leasing Ege Liman EUR 2020 Fixed 5.5 385 385
(viii)
Leasing Global GBP 2022 Fixed 3.5 690 648
Ports PLC
Leasing Barcelona EUR 2020 Floating 3.9 3 4
Cruise
Port
Leasing Barcelona EUR 2030 Floating 4.0 2,424 2,424
Cruise
Port
Leasing Malaga EUR 2036 Floating 4.0 9,478 9,479
Cruise
Port
Leasing Valetta EUR 2066 Floating 4.27 25,386 25,001
Cruise
Port
Leasing Bodrum TL 2067 Fixed 8.3 2,441 2,474
Cruise
Port
Leasing Port of EUR 2043 Floating 3.85 14,115 9,408
Adria
Leasing Zadar HRK 2038 Fixed 9.35 2,993 2,994
Leasing Cagliari EUR 2026 Fixed 4.5 328 328
Cruise
Port
Leasing Antigua USD 2048 Floating 7.65 12,072 12,072
Cruise
Port
70,547 65,448
452,990
As at 31 December 2018
Loans and Company Currency Maturity Interest Interest Principal Carrying
borrowing name type rate % value
s type
Loans used to finance investments and projects
Unsecured Global USD 2021 Fixed 8.13 250,000 250,224
Eurobonds Liman
(i)
Secured Barcelona EUR 2023 Floating Euribor 22,873 22,333
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Loan (ii) Port + 4.00
Investmen
ts
Secured Malaga EUR 2025 Floating Euribor 5,374 5,337
Loan Cruise 3m +
(iii) Port 1.75
Secured Valetta EUR 2029 Floating Euribor 9,644 8,832
Loan (iv) Cruise + 3.00
Port
Secured Global BV EUR 2020 Floating Euribor 11,172 11,176
Loan (v) + 4.60
Secured Cagliari EUR 2026 Fixed 2.20 - 635 595
Loan Cruise 6.20
Port
Secured Port of EUR 2025 Floating Euribor 21,556 21,707
Loan (vi) Adria + 4.25
Secured Ortadogu USD 2020 Fixed 3.60 - 699 700
Loan Liman 6.60
Secured Ortadogu EUR 2019 Fixed 3.40 - 572 575
Loan Liman 6.00
322,525 321,479
Loans
used to
finance
working
capital
Unsecured Ege Liman USD 2019 Fixed 6.50 330 347
Loan
Unsecured Ege Liman EUR 2020 Fixed 3.54 4,778 4,897
Loan
Unsecured Ege Liman TL 2020 Fixed 15.84 241 244
Loan
Unsecured Ege Liman TL 2019 Fixed 18.50 222 219
Loan
Secured Ege Liman TL 2020 Fixed 17.76 112 112
Loan
Secured Ortadogu EUR 2019 Fixed 3.80 - 14,876 15,136
Loan Liman 8.75
Secured Barcelona EUR 2024 Floating Euribor 2,749 2,712
Loan Cruise + 4.00
Port
23,308 23,667
Finance
lease
obligatio
ns
Leasing Ortadogu USD 2020 Fixed 7.35 533 533
(vii) Liman
Leasing Cagliari EUR 2021 Fixed 1.96 63 64
Cruise
Port
Leasing Ege Liman EUR 2020 Fixed 7.75 1,133 1,133
(viiii)
Leasing Ege Liman USD 2020 Fixed 8.60 149 175
1,878 1,905
347,051
Detailed information relating to significant loans undertaken by the Group is as follows:
i) The sales process of the Eurobond issuances amounting to USD 250 million with 7 years of maturity,
and 8.125% coupon rate based on 8.250% reoffer yield was completed on 14 November 2014. Coupon repayment
was made semi-annually. The bonds are now quoted on the Irish Stock Exchange.
Eurobonds contain the following key covenants:
· If a concession termination event occurs at any time, Global Liman (the "Issuer") must offer to
repurchase all of the notes pursuant to the terms set forth in the indenture (a "Concession Termination
Event Offer"). In the Concession Termination Event Offer, the Issuer will offer a "Concession
Termination Event Payment" in cash equal to 100% of the aggregate principal amount of notes repurchased,
in addition to accrued and unpaid interest and additional amounts, if any, on the notes repurchased, to
the date of purchase (the "Concession Termination Event Payment Date"), subject to the rights of holders
of notes on the relevant record date to receive interest due on the relevant interest payment date.
· According to the Eurobond issued by Global Liman, the consolidated leverage ratio may not exceed 5.0
to 1 (incurrence covenant). The consolidated leverage ratio as defined in the Eurobond includes Global
Liman as the issuer and all of its consolidated subsidiaries excluding the Malaga Cruise Port (being
Unrestricted Subsidiary as defined in the Eurobond). Nassau Cruise Port and GPH Antigua are subsidiaries
of GPH PLC, therefore not included on the covenant computation of Global Liman Eurobond. Irrespective of
the consolidated leverage ratio, the issuer will be entitled to incur any or all of the following
indebtedness:
· Indebtedness incurred by the Issuer, Ege Ports ("Guarantor") or Ortadogu Liman ("Guarantor") pursuant
to one or more credit facilities in an aggregate principal amount outstanding at any time not exceeding
USD 5 million;
· Purchase money indebtedness incurred to finance the acquisition by, the Issuer or a Restricted
Subsidiary, of assets in the ordinary course of business in an aggregate principal amount which, when
added together with the amount of indebtedness incurred and then outstanding, does not exceed USD 10
million;
· Any additional indebtedness of the Issuer or any Guarantor (other than and in addition to indebtedness
permitted above) and Port of Adria indebtedness, provided, however, that the aggregate principal amount
of Indebtedness outstanding at any time of this clause does not exceed USD 20 million; and provided
further, that more than 50% in aggregate principal amount of any Port of Adria indebtedness incurred
pursuant to this clause is borrowed from the International Finance Corporation and/or the European Bank
for Reconstruction and Development.
· Group debt covenants are calculated based on applicable IFRSs as of the time the lease obligations
were initially recognised. Therefore, the group debt covenants as at period end have not been affected
from the transition to IFRS 16. Management will assess in the future for any new transactions that will
be entered into, depending on the nature of them, whether debt covenants' calculations are affected.
ii) On 30 September 2014, BPI and Creuers entered into a syndicated loan. Tranch A of this loan is paid
semi- annually, at the end of June and December, with the last payment being in 2023. Tranch B already
paid, Tranch C amounting to Euro 2.4 million has a bullet payment in 2024. The interest rate of this
loan is Euribor 6m + 4.00%. The syndicated loan is subject to a number of financial ratios and
restrictions, breach of which could lead to early repayment being requested. Under this loan, in the
event of default, all the shares of BPI (a total of 3,170,500 shares each being EUR 1) and Creuers
(3,005,061shares each being EUR 1) are pledged together with certain rights of these companies. The
agreement includes terms about certain limitations on dividends payments, new investments, and change in
the control of the companies, change of the business, new loans and disposal of assets.
iii) On 12 January 2010, Cruceros Málaga, S.A. entered into a loan agreement with Unicaja regarding a
Euro 9 million loan to finance the construction of the new terminal. This loan had an 18-month grace
period. It is linked to Euribor and has a term of 180 months from the agreement execution date.
Therefore, the maturity date of the loan is on 12 January 2025. A mortgage has been taken out on the
administrative concession agreement to guarantee repayment of the loan principal and accrued interest
thereon.
iv) Valletta Cruise Port's bank loans and overdraft facilities bear interest at Euribor + 3% (31
December 2018: + 3%) per annum and are secured by a mortgage over VCP's present and future assets,
together with a mortgage over specific property within the concession site for a period of 65 years
commencing on 21 November 2001.
v) Global Ports Europe BV entered into a loan amounting to Euro 22 million in total on 16 November 2015
with a 6-year maturity, 12 months grace period and an interest rate of Euribor + 4.60%. Principal and
interest is payable bi-annually, in May and November of each year. Under this loan agreement, in the
event of default, all shares of Global Ports Europe BV are pledged to the bank in accordance with a
share pledge agreement.
vi) Port of Adria entered into a loan agreement with EBRD amounting to Euro 20 million in total on 26
February 2018 with a 6-year maturity, 2 years grace period and an interest rate of Euribor + 4.25%.
Principal and interest will be payable quarterly, in January, April, July and November of each year.
Under this loan agreement, in the event of default, all shares of Port of Adria (12.040.993 Shares
having 0,5026 EUR nominal value per each and 30.683.933 Shares having 1,1485 EUR nominal value per
each) are pledged to the bank in accordance with a share pledge agreement. In compliance with this
agreement, the Company is also guarantor of Port of Adria, and as per agreement, the Company has to
comply with the consolidated leverage ratio of 5.0 to 1, as it is presented on the Eurobond of Global
Liman.
vii) On 12 June 2014, Ortadogu Liman s signed a finance lease agreement for a port tugboat with an
interest rate of 7.35% and maturity date of 16 July 2020.
viii) On June 2014, Ege Liman signed a finance lease agreement for a port tugboat with an interest rate
of 7.75% and maturity date in 2020.
ix) Nassau Cruise Port entered into a local bridge loan financing with CFAL amounting to USD 50 million
(USD 16million was used as of reporting date) in total on 29 December 2019 with a 18 months maturity,
and an interest rate of 4.50%. Purpose of this loan agreement is financing of design, construction,
operation and maintenance of the cruise port terminal and its associated facilities in Nassau. Principal
and interest will be paid at maturity. Under this loan agreement, in the event of default, the entire
outstanding principal amount of the loan and all accrued interest shall become immediately due and
payable by lenders written consent, subject to standard cure periods, cure rights and other borrower
remedies.
x) On 26 September 2019, GPH Antigua entered into a syndicated loan with 6 years maturity and 2 years
Grace period. Repayment will be made quarterly starting from 31 December 2021, at a principal rate of
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2.0835%. Remaining amount (58.33%) will be paid at 31 December 2026. The interest rate of this loan will
be Libor + 5.75% prior to New Pier completion date and Libor + 5.25% after completion of New pier
construction. The syndicated loan is subject to a number of financial ratios and restrictions, breach of
which could lead to early repayment being requested. The agreement includes terms about certain
limitations on dividends payments, new investments, and change in the control of the companies, change
of the business, new loans and disposal of assets.
Reconciliation of movements of liabilities to cash flows arising from financing activities
USD'000 Liabilities Equity
Note Loans Leases Retained NCI Total
and earnings
Borrowi
ngs
Balance at 1 345,146 1,905 108,981 91,045 547,077
January 2019
Changes from
financing cash
flows
Proceeds from 74,918 -- -- -- 74,918
loans and
borrowings
Repayment of (31,949 (3,066) -- -- (35,015
borrowings / ) )
leases
Dividend paid 12 -- -- (29,225) (5,062 (35,591
(c) ) )
Total changes 42,969 (3,066) (29,225) (5,062 4,312
from financing )
cash flows
The effect of 4,782 (304) 29 -- 4,507
changes in
foreign exchange
rates
Other changes
Liability-related
New leases / -- 67,132 -- -- 67,132
other financial
liability
Interest expense 26,077 2,434 -- -- 28,511
Interest paid (26,388 -- -- -- (26,388
) )
Total (5,044) (2,653) -- -- (7,697)
liability-related
other changes
Total -- -- (18,732) 347 (18,385
equity-related )
other changes
Balance at 31 387,542 65,448 61,053 86,330 600,373
December 2019
USD'000 Liabilities Equity
Note Loans and Leases Retained
Borrowings earnings
NCI TOTAL
Balance at 1 338,326 3,394 143,148 92,896 577,7
January 2018 64
Changes from 6,821
financing cash
flows
Proceeds from 44,205 -- -- -- 44,20
loans and 5
borrowings
Repayment of (34,645) (1,479 -- -- (36,1
borrowings / ) 24)
leases
Dividend paid 12 -- -- (34,843) (3,797) (38,6
(c) 40)
Total changes 9,560 (1,479 (34,843) (3,797) (30,5
from financing ) 59)
cash flows
The effect of (4,076) 31 -- -- (4,04
changes in 5)
foreign exchange
rates
Other changes
Liability-related
Interest expense 25,005 192 -- -- 25,19
7
Interest paid (23,902) -- -- -- (23,9
02)
Total 233 (233) -- -- --
liability-related
other changes
Total -- -- 676 1,946 2,622
equity-related
other changes
Balance at 31 345,146 1,905 108,981 91,045 547,0
December 2018 77
14) Earnings / (Loss) per share
The Group presents basic earnings per share ("basic EPS") data for its ordinary shares. Basic EPS is
calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the
weighted average number of ordinary shares outstanding during the period, less own shares acquired.
During the year, the Group introduced share-based payments as part of its long-term incentive plan to
directors and senior management. The shares to be granted to the participants of the scheme are only
considered as potential shares when the market vesting conditions are satisfied at the reporting date.
None of the market conditions are satisfied at the reporting date and therefore there is no dilution of
the earnings per share or adjusted earnings per share (please refer to the glossary of APMs). There are no
other transactions that can result in dilution of the earnings per share or adjusted earnings per share
(please refer to the glossary of APMs).
Earnings per share is calculated by dividing the profit attributable to ordinary shareholders, by the
weighted average number of shares outstanding.
2019 2018
(USD '000) (USD '000)
Profit attributable to owners of the (18,558) 770
Company
Weighted average number of shares 62,826,963 62,826,963
Basic and diluted earnings / (loss) per (29.54) 1.23
share with par
value of GBP 0.01 (cents per share)
15 Commitments and contingencies
a) Litigation
.............
There are pending lawsuits that have been filed against or by the Group. Management of the Group assesses
the possible results and financial effects of these lawsuits at the end of each period and as a result of
these assessments, the required provisions are recognised for the possible expenses and liabilities. The
total provision amount that has been recognised as at 31 December 2019 is USD 1,295 thousand (31 December
2018: USD 200 thousand).
The information related to the significant lawsuits that the Group is directly or indirectly a party to,
is outlined below:
Legal proceedings in relation to Ortadogu Antalya and Ege Liman and Bodrum Liman's applications for
extension of their concession rights
On 6 June 2013, the Turkish Constitutional Court partially annulled a law that prevented operators of
privatised facilities from applying to extend their operating term. The respective Group companies then
applied to extend the concession terms of Port Akdeniz-Antalya, Ege Port-Kusadasi and Bodrum Cruise Port
to give each concession a total term of 49 years from original grant date. After these applications were
rejected, the respective Group companies filed lawsuits with administrative courts challenging the
decisions.
After going through legal proceedings, Bodrum Cruise Port's application for the extension of concession
term is accepted by the relevant administrative authority. The extension agreement is executed on December
2018 which has extended the remaining concession period to 49 years. The original concession agreement was
due to expire in December 2019 and following this new agreement the concession will now expire in December
2067.
Port Akdeniz-Antalya filed lawsuits against Privatization Administration and the General Directorate of
Turkey Maritime Organization requesting cancellation with respect to rejection of the extension
applications. The Court dismissed the case and the Group lawyers appealed the Court decision to the
Council of State. The Counsel of State rejected the appeal of Port Akdeniz-Antalya and approved the
decision of the Court. The Group lawyers have applied to the Council of State for reversal of this
judgement and the case is still pending.
The 31 December 2019 financial statements have been prepared assuming the current concession length.
Ege Port-Kusadasi filed lawsuits against Privatization Administration and General Directorate of Turkey
Maritime Organization requesting cancellation with respect to rejection of the extension applications. The
Court dismissed the case and the Group lawyers appealed the Court decision to the Council of State. The
Counsel of State accepted the appeal and reversed the Court's judgement in favor of Ege Port-Kusadasi. The
Privatization Administration applied to the Council of State for reversal of this judgement and this time,
the Council of State has changed its standpoint and approved the Court's decision against Ege
Port-Kusadasi. In this regard, Ege Port-Kusadasi has submitted an individual application to the
Constitutional Court. Constitutional Court has rendered its decision against Ege Port-Kusadasi and the
judicial process for the extension of the concession period has been concluded against Ege Port-Kusadasi.
Accordingly, upon expiration of the concession period in 2033, Ege Port-Kusadasi will need to participate
in the tender for new concession term.
The 31 December 2019 financial statements have been prepared assuming the current concession length.
Competition Authority Investigation
On 29 April 2019, the Competition Authority notified Port Akdeniz, that it has commenced an investigation
into Port Akdeniz due to an alleged breach of Article 6 of the Law on the Protection of Competition, Law
No. 4054 due to excessive pricing concerns on certain services. Port Akdeniz has engaged legal
representation and submitted a full defence against all allegations on 28 May 2019. By law, the
Competition Authority has 6 months from the submission date to evaluate the defences and prepare an
investigation report which can be extended by an additional 6 months. On 16 September 2019, the
Competition Authority has notified Port Akdeniz that the period for the preparation of the investigation
report has been extended to 11 April 2020. At this stage, the claim has not been matured and it depends on
the result of the final investigation report to be issued by the Competition Authority by no later than 11
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April 2020. Whole process before the Competition Authority may take up to an additional 6 to 12 months
(excluding the possibility to file an administrative lawsuit against a negative decision of the
Competition Authority).
No provision is recognised in respect of this matter.
Other legal proceedings
The Port of Adria-Bar (Montenegro) is a party to the disputes arising from the collective labour agreement
executed with the union by Luka Bar AD (former employer/company), which was applicable to Luka Bar AD
employees transferred to Port of Adria-Bar. The collective labour agreement has expired in 2010, before
the Port was acquired by the Group under the name of Port of Adria-Bar. However, a number of lawsuits have
been brought in connection to this collective labour agreement seeking (i) unpaid wages for periods before
the handover of the Port to the Group, and (ii) alleged underpaid wages as of the start of 2014. On March
2017, the Supreme Court of Montenegro adopted a Standpoint in which it is ruled that collective labour
agreement cannot be applied on rights, duties and responsibilities for employees of Port of Adria-Bar
after September 30th, 2010. Although the Standpoint has established a precedent that has applied to the
claims for the period after September 30th, 2010; there are various cases pending for claims related to
the period of October 1st, 2009 - September 30th, 2010. In respect of the foregoing period of one year,
the Port of Adria-Bar has applied to the Constitutional Court to question the alignment of the collective
labour agreement with the Constitution, Labor Law and general collective agreement. The Port of Adria-Bar
is notified that the application for initiating the procedure for reviewing the legality of the Collective
Agreement has been rejected due to a procedural reason, without evaluating the arguments submitted. The
Management is now in discussions with the local lawyers to determine defences for any potential claim and
take it to the higher court and eventually to European courts for final decision once we exhaust local law
avenue.
No provision is recognised in respect of this matter.
Global Liman Isletmeleri AS, as the majority shareholder of one of its subsidiaries, has paid a share
purchase amount of 1,500,000 USD to the shareholder of the relevant subsidiary, and the shareholder has
not transferred its shares in the subsidiary to Global Liman. Global Liman has initiated an action of debt
against the shareholder. It is expected that the case would resolve for the return of the share purchase
amount or the completion of the share transfer.
No provision is recognised in respect of this matter.
One of Port Akdeniz' clients in the cement business has initiated a lawsuit against Port Akdeniz in
relation to a commercial dispute on the fees payable by that client for its import and export transactions
in 2018. Furthermore, a counter-claim has been initiated by Port Akdeniz for an amount due from this
client in relation to loading services provided and extra fees incurred due to delays. Both cases are
pending before the competent court.
A provision is recognised in respect of this matter.
b) Guarantees
.............
As at 31 December, the letters of guarantee given comprised the following:
Letters of guarantee 2019 2018
(USD '000) (USD '000)
Given to seller for the call option on 5,457 5,585
APVS shares (*)
Given to Privatisation Administration / 2,947 2,572
Port Authority
Other governmental authorities 5,715 2,220
Others 402 75
Total letters of guarantee 14,521 10,452
(*) Venetto Sviluppo ("VS"), the 51% shareholder of APVS, which in turn owns a 53% stake in Venezia
Terminal Passegeri S.p.A (VTP), has a put option to sell its shares in APVS partially or completely (up to
51%) to Venezia Investimenti (VI). This option originally can be exercised between 15th May 2017 and 15th
November 2018, extended until the end of November 2021. If VS exercises the put option completely, VI will
own 99% of APVS and accordingly 71.51% of VTP. The Group has given a guarantee letter for its portion of
25% to VS, which serves as a security of the full amount of the put option mentioned above.
Other collaterals are disclosed in Note 13.
c) Contractual obligations
..........................
Ege Liman
The details of the TOORA ("Transfer of Operational Rights Agreement") dated 2 July 2003, executed by and
between Ege Liman and OIB together with TDI are stated below:
The agreement allows Ege Liman to operate Ege Ports-Kusadasi for a term of 30 years for a total
consideration of USD
24.3 million which has already been paid. Ege Liman's operation rights extend to port facilities,
infrastructure and facilities which are either owned by the State or were used by TDI for operating the
port, as well as the duty-free stores leased by the TDI. Ege Liman is entitled to construct and operate
new stores in the port area with the written consent of the TDI.
Ege Liman is able to determine tariffs for Ege Ports- Kusadasi's port services at its own discretion
without TDI's approval (apart from the tariffs for services provided to Turkish military ships).
The TOORA requires that the foreign ownership or voting rights in Ege Liman do not exceed 49%. Pursuant to
the terms of the TOORA, the TDI is entitled to hold one share in Ege Liman and to nominate one of Ege
Ports-
Kusadasi's board members. Global Liman appoints the remaining board members and otherwise controls all
operational decisions associated with the port. Ege Ports-Kusadasi does not have the right to transfer its
operating rights to a third party.
Ege Liman is liable for the maintenance of the Port together with the port equipment in good repair and in
operating condition throughout its operating right period. After the expiry of the contractual period, the
real estate and the integral parts of it shall be surrendered to the Government at a specific condition,
while the movable properties stay with Ege Liman.
Ortadogu Liman
The details of the TOORA dated 31 August 1998, executed by and between Ortadogu Liman and OIB together
with TDI are stated below:
Ortadogu Liman will be performing services such as sheltering, installing, charging, discharging,
shifting, terminal services, pilotage, towing, moorings, water quenching, waste reception, operating,
maintaining and repairing of cruise terminals, in Antalya Port for an operational period of 30 years.
Ortadogu Liman is liable for the maintenance of Antalya Port together with the port equipment in good
repair and in operating condition throughout its operating right period. After the expiry of the
contractual period, the real estate and the integral parts of it shall be surrendered to the TDI, while
the movable properties stay with Ortadogu Liman. Ortadogu Liman is able to determine tariffs for Port
Akdeniz- Antalya's port services at its own discretion without being subject to TDI's approval (apart from
the tariffs for services provided to Turkish military ships).
The TOORA requires that foreign ownership or voting rights in Ortadogu Liman do not exceed 49%. Pursuant
to the terms of the TOORA, the TDI is entitled to hold one share in Ortadogu Liman. The TDI can also
appoint one of Ortadogu Liman's board members. Ortadogu Liman cannot transfer its operating rights to a
third party without the prior approval of the TDI.
Ortadogu Liman is liable for the maintenance of the Port together with the port equipment in good repair
and in operating condition throughout its operating right period. After the expiry of the contractual
period, the real estate and the integral parts of it shall be surrendered to the Government at a specific
condition, while the movable properties stay with Ortadogu Liman.
c) Contractual obligations (continued)
Bodrum Liman
The details of the BOT Agreement dated 23 June 2004, executed by and between Bodrum Liman and the DLH are
stated below:
Bodrum Liman had to construct the Bodrum Cruise Port in a period of 1 year and 4 months following the
delivery of the land and thereafter, will operate the Bodrum Cruise Port for 12 years. The final
acceptance of the construction was performed on 4 December 2007, and thus the operation period has
commenced.
Bodrum Liman also executed an extension on prior Concession Agreement with the General Directorate of
National Property on 15 November 2018 ("Bodrum Port Concession Agreement"). The BOT Agreement is attached
to the Bodrum Port Concession Agreement and Bodrum Liman is entitled to use the Bodrum Cruise Port under
these agreements for an extended period of 49 years starting from 31 December 2019. The BOT Agreement
permits Bodrum Liman to determine tariffs for Bodrum Cruise Port's port services at its own discretion,
provided that it complies with applicable legislation, such as applicable maritime laws and competition
laws.
Bodrum Liman was required to pay the Directorate General for Infrastructure Investments a land utilisation
fee. This fee increases by Turkish Consumer Price index each year. With the extension signed, this fee
will be revised yearly as per the agreement between Company and Directorate General.
Bodrum Liman is liable for the maintenance of the Port together with the port equipment in good repair and
in operating condition throughout its operating right period. After the expiry of the contractual period,
the real estate and the integral parts of it shall be surrendered to the Government at a specific
condition, while the movable properties stay with Bodrum Liman.
Port of Adria
The details of the TOORA Contract dated 15 November 2013, executed by and between Global Liman and the
Government of Montenegro and AD Port of Adria-Bar are stated below:
Global Liman will be performing services such as repair, financing, operation, maintenance in the Port of
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Adria for an operational period of 30 years (terminating in 2043).
Port of Adria has an obligation to pay to the Government of Montenegro (a) a fixed concession fee in the
amount of Euro 500,000 per year; (b) a variable concession fee in the amount of Euro 5 per twenty-foot
equivalent ("TEU") (full and empty) handled over the quay (ship-to-shore and shore-to-ship container
handling), no fees are charged for the movement of the containers; (c) a variable concession fee in the
amount of Euro 0.20 per ton of general cargo handled over the quay (ship-to-shore and shore-to-ship
general cargo handling). However, pursuant to Montenegrin Law on Concessions, as an aid to the investor
for investing in a port of national interest, the concession fee was set in the amount of Euro 1 for the
period of three years starting from the effective date of the TOORA Contract. Tariffs for services are
regulated pursuant to the terms of the concession agreement with the Montenegro port authority, where the
maximum rates are subject to adjustments for inflation.
For the first three years of the agreement, Port of Adria had to implement certain investment and social
programmes outlined in the agreement and had to commit Euro 13.6 million towards capital expenditure
during that period. This included launching and investing Euro 6.5 million in certain social programmes at
Port of Adria Bar such as retrenching employees, the establishment of a successful management trainee
programme, and subsidising employees to attend training and acquire additional qualifications, as well as
the provision of English lessons to employees. All the relevant investment requirements already performed
by Port of Adria at the end of 2016.
Port of Adria is liable for the maintenance of the Port of Adria together with the port equipment in good
repair and in operating condition throughout its operating right period. After the expiry of the
contractual period, the real estate and the integral parts of it shall be surrendered to the Government of
Montenegro at a specific condition, while the movable properties stay with Port of Adria.
c) Contractual obligations (continued)
Barcelona Cruise Port
The details of the TOORA Contract dated 29 July 1999, executed by and between Creuers del Port de
Barcelona and the Barcelona Port authority are stated below:
Creuers del Port de Barcelona, S.A. ("Creuers") will be performing the management of port services related
to the traffic of tourist cruises at the Port of Barcelona, as well as the development of commercial
complementary activities corresponding to a seaport, in Adossat Wharf in Barcelona for an operational
period of 27 years. The port operation rights for Adossat Wharf (comprised of Terminals A and B)
terminates in 2030. The Port concession period can be extended automatically for three years provided that
(i) Creuers has complied with all the obligations set forth in the Port Concession; and (ii) Creuers
remains rendering port services on tourist cruises until the expiry of the extended term. Therefore, the
concession the concession period is considered to be 30 years.
Creuers is liable for the maintenance of Adossat Wharf Terminals A and B, as well as ensuring that port
equipment is maintained in good repair and in operating condition throughout its concession period. For
the detailed maintenance and investment requirements, explained in the concession agreement, replacement
provision has provided in the financials of the Company on the note 27 of the Annual report and financial
statements. After the expiry of the contractual period, the real estate and the integral parts of it shall
be surrendered to the Barcelona Port Authority.
The concession is subject to an annual payment, which consisted of the following fees: (i) a fee for the
occupancy of the public land at the port, (ii) a fee for the operation of public land for commercial
activities, and (iii) a general service fee.
The details of the TOORA Contract dated 26 July 2003, executed by and between Creuers and the Barcelona
Port authority are stated below:
Creuers will be performing the management of port services related to the traffic of tourist cruises at
the Port of Barcelona, as well as the development of commercial complementary activities corresponding to
a seaport, in WTC Wharf in Barcelona for an operational period of 27 years. The port operation rights for
the World Trade Centre Wharf (comprised of Terminals N and S) terminate in 2027. However, the Port
concession period can be extended automatically for three years provided that (i) Creuers has complied
with all the obligations set forth in the Port Concession; and (ii) Creuers remains rendering port
services on tourist cruises until the expiry of the extended term. Therefore, the concession period is
considered as 30 years. Creuers is liable for the maintenance of Adossat Wharf Terminals N and S together
with the port equipment in good repair and in operating condition throughout its operating right period.
After the expiry of the contractual period, the real estate and the integral parts of it shall be
surrendered to the Barcelona Port Authority.
Malaga Cruise Port
The details of the TOORA Contract dated 9 July 2008, executed by and between Cruceros Malaga and the
Malaga Port authority are stated below:
Cruceros Málaga, S.A. obtained an administrative concession to occupy the Levante Terminal of the Malaga
Port and its exploitation, for a 30-year period, terminating in 2038. The concession term can be extended
for up to fifteen years, in two terms of 10 and 5 additional years (extending the total concession period
to 45 years), due to an amendment to the Malaga Levante Agreement approved by the Malaga Port Authority in
its resolution dated 28 October 2009. These extensions require (i) the approval by the Malaga Port
Authority and (ii) Cruceros Malaga to comply with all of the obligations set forth in the concession.
Cruceros will perform passenger services, terminal usage and luggage services, as well as undertake
general maintenance of the Levante Terminal. Cruceros is responsible for ensuring that the port equipment
is maintained in good repair and operating condition throughout the concession term.
c) Contractual obligations (continued)
Malaga Cruise Port (continued)
The concession is subject to an annual payment, which consisted of the following fees: (i) a fee for the
occupancy of the public land at the port, and (ii) a fee for the operation of public land for commercial
activities.
The details of the TOORA Contract dated 11 December 2011, executed by and between Cruceros Malaga and the
Malaga Port authority are stated below:
Cruceros Málaga, S.A. obtained an administrative concession to occupy El Palmeral Terminal of the Malaga
Port and its exploitation, for a 30-year period, terminating in 2042. Cruceros will perform passenger
services, terminal usage and luggage services, as well as undertake general maintenance of the El Palmeral
Terminal. Cruceros is responsible for ensuring that the port equipment is maintained in good repair and
operating condition throughout the concession term.
The concession is subject to an annual payment, which was Euro 154,897 in 2016, which consisted of the
following fees: (i) a fee for the occupancy of the public land at the port, and (ii) a fee for the
operation of public land for commercial activities.
Valletta Cruise Port
On 22 November 2001, VCP signed a deed with the Government of Malta by virtue of which the Government
granted a 65-year concession over the buildings and lands situated in Floriana, which has an area of
46,197square metres ("sqm"). VCP will perform operation and management of a cruise liner passenger
terminal and an international ferry passenger terminal together with complementary leisure facilities. The
area transferred is used as follows: retail 6,854sqm, office 4,833sqm, terminal 21,145sqm and potential
buildings 13,365sqm.
A ground rent is payable by Valletta Cruise Port to the Government of Malta. At the end of each 12 months
period, VCP is required pay to the Government of Malta (a) 15% of all revenue deriving from the letting of
any buildings or facilities on the concession site for that 12 month period, and (b) 10% of revenue
deriving from passenger and cruise liner operations, subject to the deduction of direct costs and services
from the revenue upon which 10% fee is payable.
Ravenna Passenger Terminal
On 19 December 2009, Ravenna Terminal Passeggeri S.r.l ("RTP") signed a deed with the Ravenna Port
Authority by virtue of which the Port Authority granted a 10-year concession over the passenger terminal
area situated within Ravenna Port. RTP will perform operation and management of a cruise passenger
terminal in the area.
A fixed rent is payable by RTP to the Port Authority in the sum of Euro 895,541.67 during the concession
period. The repayment of the total amount is presented as Euro 3,000 for the year 2009, Euro 28,791.67 for
the year 2010 and the remaining Euro 863,750 overall for the years 2011 to 2020.
Catania Cruise Terminal
On 18 October 2011, Catania Cruise Terminal SRL ("CCT") signed a deed with the Catania Port Authority by
virtue of which the Port Authority granted a 15-year concession over the passenger terminal area situated
on Catania City Center. CCT will perform operation and management of a cruise passenger terminal in the
area.
A fixed rent is payable by CCT to the Port Authority in the sum of Euro 135,000.00 for each year during
the concession period.
Cagliari Cruise Terminal
On 14 January 2013, Cagliari Cruise Port S.r.l ("CCP") signed a deed with the Cagliari Port Authority by
virtue of which the Port Authority granted a 15-year concession over the passenger terminal area situated
within Cagliari Port. CCT will perform operation and management of a cruise passenger terminal in the
area.
A fixed rent is payable by CCP to the Port Authority in the sum of Euro 44,315.74 for each year during the
concession period.
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15) Commitments and contingencies (continued)
c) Contractual obligations (continued)
Nassau Cruise Port
On 28 August 2019, Nassau Cruise Port Ltd ("NCP") signed a deed with the Government of Bahamas by virtue
of which the Government granted a 25-year concession over the passenger terminal area situated within
Nassau Cruise Port. NCP will perform operation and management of the cruise passenger terminal in the
area.
NCP will invest an amount of $250m in expanding the capacity of the port. Investment amount also includes
ancillary contributions made to local community to increase the wealth of people of Bahamas. These
payments will be made as grant and partly as interest free loan.
The construction phase is expected to start in 2020 and is anticipated to be completed within 24 months,
once construction has been completed total revenues are expected to be in the range of $35-40m per annum.
A variable fee payment based on the number of passengers will be made to the Port Authority starting from
the operations commencement date. Starting from the construction commencement date and until the end of
the concession, a minimum fixed fee will be payable to the Port Authority amounting to USD2m from
construction date to end of construction and USD2.5m from construction end date until the end of
concession per annum.
Antigua Cruise Port
On 24 October 2019, Antigua Cruise Port Ltd ("ACP") signed a deed with the Government of Antigua&Barbuda
by virtue of which the government granted a 30-year concession over the passenger terminal area situated
within Antigua Cruise Port. ACP will perform operation and management of a cruise passenger terminal in
the area.
Total initial investment in the first 12 months of operation will be between $45-50m, including repayment
of the existing bond of USD 21m, completion of new pier construction and dredging work, and investment
into the retail facilities. The Company's cash equity contribution is set at 27.5%, with the balance
provided through non-recourse project finance.
A variable fee payment based on the number of passengers will be made to the Port Authority with a minimum
fee guarantee. From the 21st year of the concession, ACP will pay a share of its annual revenue annually
to the Port Authority.
16 Leases
Lease as lessee (IFRS 16)
The Group entered into various operating lease agreements. In the periods presented, the Group's main
operating lease arrangements as lessee are the port rent agreement of Valletta Cruise Port until 2066,
Port of Adria until 2043, Creuers until 2033, Cruceros until 2043, Zadar Cruise Port until 2039, Antigua
Cruise Port until 2049 and Bodrum Liman until 2067. Part of the concession agreements of Creuers and
Cruceros relating to the occupancy of the public land at the port and the operation of public land for
commercial activities, which are out of scope of IFRIC 12, have been accounted for under IFRS 16 - Leases.
The Company has a leasing agreement to rent its office at third floor offices at 34 Brook Street London.
This lease has no purchase options and escalation clauses.
Right of use assets
Right-of-use assets related to leased properties that do not meet the definition of investment property
are presented separately.
2019 - Leases under IFRS 16 As at
31 December 2019
(USD '000)
Balance at 1 January from initial application 58,983
of IFRS 16
Depreciation charge for the year (2,382)
Additions to Right of Use assets 25,601
Currency translation differences (1,079)
Balance at 31 December 81,123
Right of use assets (continued)
The Company has created right of use asset for Antigua Cruise Port after acquisition. A variable fee
payment based on the number of passengers will be made to the Port Authority with a minimum fee guarantee.
From the 21st year of the concession, ACP will pay a share of its annual revenue annually to the Port
Authority. Company has repaid outstanding loan amounting to $21,000 thousand on the initial acquisition
date. The Company has recognised the loan and the discounted future payments as right of use asset and
recognised an equivalent lease liability.
Amounts recognized in profit or loss
2019 - Leases under IFRS 16 As at
31 December 2019
(USD '000)
Interest on lease liabilities (2,385)
Expenses relating to short-term leases (75)
2018 - Operating leases under IAS 17
Lease expense (5,656)
Contingent rent expense 2,294
Amounts recognized in statement of cash flows
As at
31 December 2019
(USD '000)
Total cash outflow for leases (3,066)
Extension options
All concession agreements contain extension options exercisable by the Group. These options are
exercisable with the submission of the extension request by the Group before expiry of current concession
agreements. Extendable rights vary based on the country regulations, and current concession period.
Extension options are evaluated by management on contract basis, and the decision is based on the Port's
performance, and possible extension period. Extension options in concession agreements are being provided
for the continuation of the port's operations. The extension options held are exercisable only by the
Group and in some agreements subject to approval of the grantor. Accordingly, the Group includes only
already signed contract periods for the concession life.
The Group has estimated that the potential future lease payments, should it exercise all extension
options, would result in an increase in lease liability of USD 3,006 thousand.
Lease as lessor
The Group's main operating lease arrangements as lessor are a marina lease agreement of Ortadogu Liman
until 2028, and various shopping centre rent agreements of Ege Port, Bodrum Cruise Port, Valletta Cruise
Port, Barcelona Cruise Port, Malaga Cruise Port, Zadar Cruise Port, and Antigua Cruise Port. All leases
are classified as operating leases from a lessor perspective.
Leases as lessor (continued)
The following table sets out a maturity analysis of lease receivables, showing the payments to be received
after the reporting date. Under IAS 17, the Group did not have any finance leases as a lessor.
2019 - Leases under IFRS 16 As at
31 December 2019
(USD '000)
Less than one year 3,008
One to two years 2,075
Two to three years 1,843
Three to four years 1,432
Four to five years 1,175
More than five years 5,036
Total 14,569
2018 - Operating leases under IAS 17
Less than one year 5,141
Between one and five years 7,059
More than five years 4,019
Total 16,219
During the year ended 31 December 2019, USD 10,767 thousand (31 December 2018: USD 10,044 thousand) was
recognised as rental income in the consolidated income statement and other comprehensive income.
17 Investment Property
See accounting policy in Note 3(l) of the Annual report and financial statements.
Reconciliation of carrying amount
As at
31 December 2019
(USD '000)
1 January 2019 --
Recognition of right-of-use asset on initial
application of
2,250
IFRS 16
Depreciation charge for the year (59)
Currency translation differences (52)
Balance at 31 December 2,139
Investment property comprises Valletta Cruise Port's commercial property that is leased to third parties.
18 Related parties
The related parties of the Group which are disclosed in this
note comprised the following:
Related parties Relationship
Mehmet Kutman Chairman and ultimate
controlling party
Aysegül Bensel Shareholder of Ultimate parent
company
Global Yatirim Holding Ultimate parent company
Global Ports Holding BV Parent company
Global Sigorta Aracilik Ultimate controlling party's
Hizmetleri A.S. ("Global subsidiary
Sigorta")
IEG Kurumsal Finansal Ultimate controlling party's
Danismanlik A.S. ("IEG Global") subsidiary
Global Menkul Degerler A.S. Ultimate controlling party's
("Global Menkul") subsidiary
Adonia Shipping Ultimate controlling party's
subsidiary
Naturel Gaz Ultimate controlling party's
subsidiary
Straton Maden Ultimate controlling party's
subsidiary
Goulette Cruise Holding Joint-Venture
All related party transactions between the Company and its subsidiaries have been eliminated on
consolidation, and are therefore not disclosed in this note.
Due from related parties
As at 31 December, current receivables from related parties comprised the following:
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2019 2018
Current receivables from related parties (USD (USD '000)
'000)
Global Yatirim Holding 312 602
Adonia Shipping (*) 59 67
Naturel Gaz (*) -- 72
Straton Maden (*) 67 73
IEG Global 56 57
Global Ports Holding BV 4 47
Lisbon Cruise Terminals LDA 44 37
Mehmet Kutman -- 17
Aysegül Bensel -- 1
Other Global Yatirim Holding Subsidiaries 229 54
Total 771 1,027
Non-current receivables from related
parties
Goulette Cruise Holding (**) 6,811 --
6,811 --
(*) These amounts are related with the work advances paid related with the services taken on utilities by
Group Companies. The charged interest rate is 11,75% as at 31 December 2019 (31 December 2018: 9.75 %).
(**) Company is financing its Joint venture for the payment of La Goultte Shipping Company acquisition
price with a maturity of 5 years. Yearly interest of 4.5% is charged.
Due to related parties
As at 31 December, current payables to related parties comprised the following:
2019 2018
Current payables to related parties (USD '000) (USD '000)
Mehmet Kutman 545 153
Global Sigorta (*) 527 309
Global Yatirim Holding -- 1
Aysegül Bensel 154 53
Other Global Yatirim Holding Subsidiaries 91 26
Total 1,317 542
(*) These amounts are related to professional services received. The charged interest rate is 12,50% as at
31 December 2019 (31 December 2018: 19,50%).
(**) In addition, EBRD had provided a loan to Port of Adria for a total amount of EUR 20m, details
explained on Note 13.
18 Related parties (continued)
Transactions with related parties
For the years ended 31 December, transactions with other related parties comprised the following:
USD '000 2019 2018
Rent Interest Rent Interest
Income received Other Income received Other
Global 203 -- 128 -- 252 --
Yatirim
Holding
Adonia -- -- -- -- -- --
Shipping
Global Menkul -- -- -- -- 197 --
Total 203 -- 128 -- 449 --
USD '000 2019 2018
Project Project
Expenses Other expenses Other
Global 920 138 -- 2
Yatirim
Holding
Global Menkul -- 1 -- --
Total 920 139 -- 2
For the year ended 31 December 2019, GPH distributed a total dividend of USD 17,318 thousand to Global
Yatirim Holding (31 December 2018: USD 21,472 thousand).
Transactions with key management personnel
Key management personnel comprised the members of the Board and GPH's senior management. For the years
ended 31 December, details of benefits to key management personnel comprised the following:
2019 2018
(USD '000) (USD '000)
Salaries 3,070 2,279
Attendance fees to Board of Directors 172 1,278
Bonus 361 810
Termination benefits 5 25
Total 3,608 4,392
19 Events after the reporting date
Creuers Del Port de Barcelona SA ("Creuers"), 62% subsidiary of the Company, has completed the purchase of
Autoridad Portuaria de Malaga's (Malaga Port Authority) 20.0% holding in the Malaga cruise port concession
for
EUR 1.5m. This increases Creuers ownership of the Malaga cruise port concession to 100% and GPH's
effective ownership to 62% from 49.6%.
Board members Thierry Edmond Déau and Thomas Josef Maier stepped down as Independent Non-Executive
Directors of the Company, effective from the meeting of the Board on 24 February 2020. Both Mr Déau and Mr
Maier, having decided not to stand for re-election at the next AGM, agreed to step down early to allow new
board members to join as soon as practically possible.
Company appointed Andy Stuart as an Independent Non-Executive Director effective from 25 February 2020.
As one of the potential options of the Group strategic review, which remains ongoing, and following a
competitive sales process conducted in H2 2019, the Group has entered into exclusive negotiations with a
potential buyer for our commercial interests at Port Akdeniz. As at both the reporting date and the date
of approval of these financial statements it would be premature to speculate on a timeframe or terms of a
possible sale or, indeed whether a transaction concludes. As such, Port Akdeniz did not meet the criteria
of non-current assets held for sale as at 31 December 2019.
In Q1 2020 the emergence of the Covid-19 virus in China and then its spread around the world, led to an
unprecedented level of disruption to global trade and the cruise industry. While this is a non-adjusting
event as per IAS 10, the balances that would have been significantly affected by this event are the port
operation rights and right of use assets. The impact on their recoverable amount can be material.
Management keeps monitoring the outbreak of the virus and is continuously performing a full assessment of
the impact on the Group's commercial and cruise ports. Please refer to the Going Concern in note 1.
ISIN: GB00BD2ZT390
Category Code: FR
TIDM: GPH
Sequence No.: 58033
EQS News ID: 1020853
End of Announcement EQS News Service
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