TIDMDPEU
RNS Number : 2565B
DP Eurasia N.V
30 September 2022
30 September 2022
DP Eurasia N.V.
("DP Eurasia" or the "Company", and together with its
subsidiaries, the " Group ")
Interim Results for the Period Ended 30 June 2022 (1)
Highlights (2)
For the period ended
30 June
(pre - IAS 29)
-------------------------
2022 2021 Change
------------ ----------- -------
(in millions of
TRY, unless otherwise
indicated)
Number of stores 842 792 50
Group system sales (3)
Turkey 1,201 756 58.9%
Russia 493 279 76.8%
Azerbaijan & Georgia 43 19 122%
COFFY 14 1.4 952%
Total 1,751 1,055 66%
For the period ended
30 June
(after IAS 29)
-------------------------
2022 2021 Change
------------ ----------- -------
(in millions of
TRY, unless otherwise
indicated)
Number of stores 842 792 50
Group system sales (3)
Turkey 1,349 1,396 -3.4%
Russia 493 279 76.8%
Azerbaijan & Georgia 49 36 35.2%
COFFY 16 2.5 521%
Total 1,906 1,713 11.2%
For the period ended
30 June
(pre - IAS 29)
-------------------------
2022 2021 Change
------------ ----------- -------
(in millions of
TRY, unless otherwise
indicated)
System sales like-for-like growth
Group(10) 38.0% 52.4%
Turkey 51.0% 64.9%
Russia (based on RUB) -2.6% 18.2%
Azerbaijan -0.6% 9.5%
Georgia 33.1% 59.2%
Revenue 1,137 658 72.8%
Turkey adjusted EBITDA(5) 155 92 68.1%
Russia adjusted EBITDA(5) 14 13 8.2%
Adjusted EBITDA(5) 155 98 58.1%
Adjusted net income(6) 73 35 109%
Adjusted net debt(7) 1,085 762 42.4%
For the period ended
30 June
(after IAS 29)
-------------------------
2022 2021 Change
------------ ----------- -------
(in millions of
TRY, unless otherwise
indicated)
System sales like-for-like growth
Group(10) -6.8% 35.4%
Turkey -8.4% 41.6%
Russia (based on RUB) -2.6% 18.2%
Azerbaijan -0.6% 9.5%
Georgia 33.1% 59.2%
(after IAS 29, reviewed)
Revenue (1) 1,259 1,045 20.5%
Turkey adjusted EBITDA(1),
(5) 152 139 9.9%
Russia adjusted EBITDA(1),
(5) 14 13 8.2%
Adjusted EBITDA(1), (5) 153 145 5.6%
Adjusted net income(1),
(6) 95 58 63.4%
Adjusted net debt(1), (7) 1,085 762 42.4%
Financial Highlights
-- Adjusted for the hyperinflation in Turkey (in accordance with
the IAS 29 "Financial Reporting in Hyperinflationary Economies"
standard), Group revenue was up 20.5% and system sales were up
11.2%, reflecting healthy growth at the Group level while set
against very strong comparatives.
-- The Group's LfL performance was -6.8%, but this includes the
positive impact of last year's VAT reduction of 7pp to 1% (which
lasted until the end of September 2021). Adjusting to exclude this
would show a flat LfL performance on 1H 2022 with low single digit
growth in volumes.
-- Adjusted EBITDA of TRY 153 million corresponds to 5.6% growth
and was achieved in a difficult cost environment as Turkish
operations faced an average 64% headline inflation compared to H1
2021.
-- Adjusted net income was TRY 95 million (1H21: TRY 58
million), corresponding to a 63.4% increase
-- Liquidity position at Period-end: TRY 268 million cash and an
undrawn bank facility of TRY 157 million.
-- Adjusted net debt was TRY 1,085 million as of 30 June 2022 (H1 2021: TRY 762 million)
Operational Highlights
-- Online delivery system sales further increased to 82.9% (June
2021: 75.5%) as a share of delivery system sales (7) , reflecting
DP Eurasia's robust positioning for the online ordering
channel.
-- Group online system sales (8) growth of 15.5%
o Turkish online system sales growth of 1%
o Russian online system sales growth of 77.5% (-6.8% based on
RUB)
-- 29 net store openings in Turkey, including COFFY and
Azerbaijan & Georgia, during the first half of the year
-- 21 net Domino's Pizza store openings in Turkey maintains our
momentum and is on top of record level of openings in 2021.
-- Having opened seven new stores in the first half of the year,
COFFY traded from 15 stores at period-end, 10 of which are
franchised.
2022 Outlook
-- The Group continues to trade in line with its formal guidance
(as set out below) for FY2022, which was reinstated by management
in the trading update of 21 July.
-- Management anticipates that in this inflationary environment,
FY2022 adjusted EBITDA is likely to be above current market
expectations but remains mindful of operating in a volatile
environment with the potential for further macro-economic and
geopolitical challenges.
-- The strong store opening momentum in Turkey is anticipated to
continue in the second half, driven by robust franchisee
demand.
-- As previously announced, investment into the Group's Russian
operations remains limited with attention focused on optimising the
existing store network. Management continues to actively monitor
the situation in the region closely.
-- COFFY represents an outstanding growth opportunity for the
Group. Thanks to the strong franchisee demand, store openings are
anticipated to continue at pace in the second half. The COFFY
network has reached 20 stores as of today's date.
-- Guidance for store openings, LfL growth and capital expenditure for FY 2022 is as follows:
Turkey Russia
------------------------- ------------------------- ---------------------------
LfL growth rate 55 - 65%* 0% (based on RUB)
Domino's Pizza net store
openings 30 - 40 0
COFFY net store openings 20 - 30 -
Capital expenditure TRY 90 million* RUB 190 million
------------------------- ------------------------- ---------------------------
* excluding impact of IAS 29 accounting
Commenting on the results, Chief Executive Officer, Aslan
Saranga said:
"On behalf of the Board, I am pleased to report solid earnings
growth for the first half of 2022 as we worked hard to combat the
high levels of financial volatility in the regions we operate. This
performance was enabled by our capabilities, experienced team, and
culture. We have an innovative and customer-centric mindset,
helping us to grow in a healthy manner as we pursue long term and
sustainable profit. Before going into details, I would like to note
that our Turkish business performance is adjusted with
hyper-inflation in Turkey according to IAS 29 standards.
"Our like-for-like performance caught up with the rapid pace of
inflation, when adjusted for last year's VAT advantage, thanks to
our strategic pricing actions, sustained volume performance and
everyday efficiency. Despite unprecedented cost pressures, we
increased adjusted EBITDA by 5.6% and adjusted net income by 63.4%
compared to the same period a year ago.
"We have effectively mitigated the inflation challenge with
clear and targeted action in three areas - strategic pricing and
product innovation; continued digital innovation; and operational
efficiencies to enhance profitability. Our product portfolio and
innovation continue, and we recently introduced Pizzetta, a new
personal pizza that is offered at a very competitive price of
TRY19.99 (c. USD 1). We are also introducing 'snacks from the oven'
take-away range that will complete our suite value options. These
new products present a great choice for customers who are seeking
affordable value amid an inflationary environment.
"We remain committed to providing the best value for money
proposition on the market and to ensuring our franchisees remain
profitable. As a result, franchisee demand remained strong. We
opened 29 net stores in Turkey during the first half of the year,
including COFFY and Azerbaijan & Georgia. Domino's Pizza store
count grew by 21 stores in Turkey year to date. Given our strong
pipeline, we remain confident that 2022 will be another solid year
for store growth.
"Our own brand, COFFY, has been performing extremely well. It is
positioned to provide Turkish consumers with a simple, value for
money and convenient coffee brand and, as a result, achieved robust
volume and sales growth. Having installed new store concepts to fit
in with local circumstances, our COFFY network reached 15 stores.
Franchisee demand stands very strong, which is likely to carry the
total COFFY store count above 30 by the end of the year. Hence, I
personally believe that our growth potential at COFFY is very
promising.
"In Russia, we faced into a strong comparable period while
operating in a difficult geo-political and economic environment. As
a result, we had a negative 2.6% LfL by the end of first half. As
previously announced, the Group continues to limit investment into
the territory and is focused on optimising the store coverage in
Russia. Please note that number of stores in Russia stood at 171 as
of September compared to 184 stores by the end of first half. We
continue to monitor the situation in the region closely while the
safety and welfare of all the Group's employees and customers
remains our primary priority.
"While, The Board is conscious of the ongoing uncertainty while
current trends suggest that our adjusted EBITDA(4) for 2022 is
likely to be above the current market expectations."
Enquiries
DP Eurasia N.V.
İlknur Kocaer, CFA - Investor Relations
Director +90 212 280 9636
Buchanan (Financial Communications)
Richard Oldworth / Toto Berger / Verity +44 20 7466 5000
Parker dp@buchanan.uk.com
A conference call will be held at 9.30am
today for analysts and investors via the
following dial-in details:
Conference UK Toll: +44 3333 000 804
call: UK Toll Free: 0800 358 9473
Participant PIN code: 89109082#
URL for international dial in numbers:
https://events-ftp.arkadin.com/ev/docs/NE_W2_TF_Events_International_Acces
s_List.pdf
DP Eurasia N.V.'s 2022 interim results presentation are
available at www.dpeurasia.com . A conference call replay will be
available on the website in due course.
Notes
(1) Financial statements as at 30 June 2022 are subjected to
limited review and non-IFRS measures are not audited.
(2) COFFY numbers are included in all Turkey and Group figures,
unless presented separately. Like-for-like figures exclude
COFFY
(3) System sales are sales generated by the Group's corporate
and franchised stores to external customers and do not represent
revenue of the Group. These numbers are not audited.
(4) Like-for-like growth is a comparison of sales between two
periods that compares system sales of existing system stores. The
Group's system stores that are included in like-for-like system
sales comparisons are those that have operated for at least 52
weeks preceding the beginning of the first month of the period used
in the like-for-like comparisons for a certain reporting period,
assuming the relevant system store has not subsequently closed or
been "split" (which involves the Group opening an additional store
within the same map of an existing store or in an overlapping
area). This is a non-IFRS measure and non-IFRS measures are not
audited.
(5) EBITDA, adjusted EBITDA and non-recurring and non-trade
income/expenses are not defined by IFRS and non-IFRS measures are
not audited. These items are determined by the principles defined
by the Group management and comprise income/expenses which are
assumed by the Group management to not be part of the normal course
of business and are non-trading items. These items which are not
defined by IFRS are disclosed by the Group management separately
for a better understanding and measurement of the sustainable
performance of the Group. Please refer to Note 3 in the
Consolidated Financial statements for a reconciliation of these
items with IFRS.
(6) Adjusted net income is not defined by IFRS and non-IFRS
measures are not audited. Adjusted net income excludes income and
expenses which are not part of the normal course of business and
are non-recurring items. Management uses this measurement basis to
focus on core trading activities of the business segments and to
assist it in evaluating underlying business performance. Please
refer to Note 3 in the Consolidated Financial statements for a
reconciliation of this item with IFRS.
(7) Net debt and adjusted net debt are not defined by IFRS and
non-IFRS measures are not audited. Adjusted net debt includes cash
deposits used as a loan guarantee and cash paid, but not collected
during the non-working day at the year end. Management uses these
numbers to focus on net debt including deposits not otherwise
considered cash and cash equivalents under IFRS.
(8) Delivery system sales are system sales of the Group
generated through the Group's delivery distribution channel.
(9) Online system sales are system sales of the Group generated
through its online ordering channel.
(10) Group like-for-like growth is a weighted average of the
country like-for-like growths based on store numbers as described
in Note (2). This is a non-IFRS measure and non-IFRS measures are
not audited.
Notes to Editors
DP Eurasia N.V. is the exclusive master franchisee of the
Domino's Pizza brand in Turkey, Russia, Azerbaijan and Georgia. The
Company was admitted to the premium listing segment of the Official
List of the Financial Conduct Authority and to trading on the main
market for listed securities of the London Stock Exchange plc on 3
July 2017. The Company (together with its subsidiaries, the " Group
" ) is the largest pizza delivery company in Turkey and the third
largest in Russia. The Group offers pizza delivery and takeaway/
eat-in facilities at its 827 stores (628 in Turkey, 184 in Russia,
10 in Azerbaijan and 5 in Georgia as of 30 June 2022) and operates
through its owned corporate stores (22%) and franchised stores
(78%). In addition to its pizza delivery business, the Group also
has its own coffee brand, COFFY, which trades from 15 stores at
period-end, 10 of which are franchised. The Group maintains a
strategic balance between corporate and franchised stores,
establishing networks of corporate stores in its most densely
populated areas to provide a development platform upon which to
promote best practice and maximise profitability. The Group has
adapted the Domino's Pizza globally proven business model to its
local markets.
Performance Review
Store count As at 30 June
----------------------------------------------------------------
2022 2021
Corporate Franchised Total Corporate Franchised Total
Turkey (Domino's) 94 534 628 103 481 584
Russia 92 92 184 116 76 192
Azerbaijan - 10 10 - 9 9
Georgia - 5 5 - 4 4
COFFY 5 10 15 2 1 3
Total 191 651 842 220 572 792
DP Eurasia's store count grew by 50 stores year-on-year and by
25 since the end of 2021. The Group increased its system sales by
inflation-adjusted 11.2% year-on-year.
The Turkish operations' system sales, representing 71% of Group
system sales, contracted by 3.4% on inflation adjusted basis.
Nonetheless, adjusted for last year's VAT reduction of 7pp to 1%
(which lasted until end of July), system sales growth would be
around 4%. On similar basis, like-for-like growth in Turkey would
be flattish in 1H2022. The Group experienced robust franchisee
interest in Turkey resulting in a strong store pipeline, laying
solid foundations for future growth. Domino's Pizza store count in
Turkey increased by 44 over the last twelve months and 21 since the
end of 2021.
COFFY has demonstrated very strong sales performance and now
represents an outstanding growth opportunity for the Group. Having
opened seven new stores in the first half of the year (and 12
stores year-on-year), COFFY traded from 15 stores at period-end, 10
of which are franchised. Thanks to the strong franchisee demand,
store openings continue at full speed.
The Russian operations' system sales, representing 26% of Group
system sales, increased by 76.8% (-7% based on RUB). The Group
reported -2.6% like-for-like growth in Russia during the period. In
Russia, we faced into a strong comparable period while operating in
a difficult geo-political and economic environment. As previously
announced, the Group continues to limit investment into the
territory and is focused on optimising the existing store coverage
in Russia. Number of stores stood at 171 by the end of September
compared to 184 stores by the end of first half of the year.
Delivery Channel Mix and Online like-for-like growth
The following table shows the Group's delivery system sales,
analysed by ordering channel and by the Group's two largest
countries in which it operates, as a percentage of delivery system
sales:
For the period ended 30 June
--------------------------------------------------
2022 2021
------------------------ ------------------------
Turkey Russia Total Turkey Russia Total
18.3 6.5 16.8 25.6 7.7 24.2
Store % % % % % %
Group's online 25.1 72.2 37.1 25.9 69.5 32.2
Online platform % % % % % %
56.1 21.3 45.8 48.1 22.9 43.3
Aggregator % % % % % %
81.2 93.5 82.9 74.0 92.3 75.5
Total online % % % % % %
Call 0.5 0.4 0.4 0.3
centre % - % % - %
Total 100% 100% 100% 100% 100% 100%
The following table shows the Group's online like-for-like
growth (10) , analysed by the Group's two largest countries in
which it operates:
For the period ended
30 June
-----------------------
2022 2021
------------ ---------
Online system sales like-for-like growth(9)
Group(10) -3.0% 56.9%
Turkey -3.2% 70.1%
Russia (based on RUB) -2.5% 19.2%
Online delivery system sales as a share of delivery system sales
reached 82.9% for the period, which represents a 7.3 percentage
point increase on a year-on-year basis. The share of online sales
in the Turkish delivery system reached 81.2%. This corresponded to
more than seven percentage point increase over the last twelve
months. This performance was aided also by an increase in volumes
through the aggregators. The online system sales share in Russia
increased to 93.5% delivering around one and a half percentage
points of increase.
Financial Review
For the period ended
30 June
-----------------------
2022 2021 Change
----------- ---------- -------
(in millions of TRY)
Revenue 1,259 1045 20.5%
Cost of sales (869) (682) 27.4%
Gross Profit 390 363 7.5%
General administrative expenses (190) (135) 40.3%
Marketing and selling expenses (191) (178) 7.5%
Other operating expenses, net 18 (7) n.m.
Operating profit 28 43 -34.9%
Foreign exchange gains/(losses) 124 52 138.2%
Financial income 20 25 -19.0%
Financial expense (107) (65) 63.9%
Monetary profit / (loss) 74 24 215.1%
Profit/(Loss) before income
tax 140 79 77%
Tax expense (52) (37) 42.9%
Profit/(Loss) after tax 88 42 107.5%
Turkey adjusted EBITDA(4) 152 139 9.9%
Russia adjusted EBITDA(4) 14 13 8.2%
Adjusted EBITDA(4) 153 145 5.6%
Adjusted net income(5) 95 58 63.4%
Adjusted net debt(6) 1,085 762 42.4%
Revenue
Group revenue grew by 20.5% to TRY 1,259 million on inflation
adjusted basis. Turkey segment revenue grew by 9.0% to TRY 917
million, while Russia segment revenue grew by 67.7% to reach TRY
342 million.
Adjusted EBITDA
The Group's adjusted EBITDA grew by 5.6% to TRY 153 million.
Adjusted EBITDA for the Turkish segment, which includes the
Azerbaijani and Georgian businesses along with COFFY, was TRY 152
million, a year-on-year increase of 9.9%, and adjusted EBITDA for
the Russian segment was TRY 14 million.
For the period ended 30 June 2022, the Group's adjusted EBITDA
margin as a percentage of revenues was 12.1% compared to 13.9% over
the same period in 2021. Unprecedented increases in food costs
across the board and higher personnel expenses were the main
drivers for the decrease. The Russian segment margin declined to
4.1% from 6.3% due to relatively weak operating leverage.
Adjusted EBITDA margin as a percentage of revenues for the
Turkish segment (including Azerbaijan, Georgia and COFFY business)
recorded a small increase to 16.6% from 16.5% mainly due to the
strong sales performance creating operating leverage through the
system despite the above-mentioned cost pressure. The Group took
the advantage of its robust purchasing power and also built-up
additional inventory during the period to combat with elevated food
costs. The latter action was also the main reason behind the higher
net debt position.
Adjusted Net Income
For the period ended 30 June 2022, adjusted net income was TRY
95 million. The growth in revenue and adjusted EBITDA as well as
the foreign exchange gains due to the devaluation of the TRY
against the RUB were the main reasons for the return to
profitability. Following the hyper-inflation accounting, the Group
also posted higher monetary gain compared to last year's
adjustment. While the Group's bank facilities are TRY and RUB
denominated, the Group recorded a foreign exchange gain of TRY 124
million primarily due to the devaluation of the TRY against the RUB
versus a gain of TRY 52 million in the same period of the last
year.
Capital expenditure and Cash conversion
The Group incurred TRY 57 million of capital expenditure in the
period ended 30 June 2022. The Turkish segment capital expenditure
was TRY 38 million and the Russian segment capital expenditures
amounted to TRY 19 million (c. RUB 95 million).
Cash conversion, defined as (adjusted EBITDA [excluding IFRS 16
impact] - capital expenditure) / (adjusted EBITDA [excluding IFRS
16 impact]) for the period stayed the same 43% (H1 2021: 43%) for
the Group. On the other hand, the Turkish segment improved its cash
conversion to 71% (H1 2021: 55%) because of its improved adjusted
EBITDA and prudent capital expenditure management. The Russian
segment had negative cash conversion during the period.
Adjusted net debt and leverage
The Group's adjusted net debt as of 30 June 2022 was TRY 1,085
million, representing an increase of 42.4% from 30 June 2021. The
Group's bank borrowings continue to be denominated in its
operational currencies of TRY and RUB. As of 30 June 2022, 64% of
the Group's bank borrowings were denominated in TRY, while 36% is
denominated in RUB. This was aligned with the revenue composition
as 73% of Group revenues were denominated in TRY and rest in
RUB.
The Group's leverage ratio (defined as adjusted net
debt/adjusted EBITDA for the last 12 months) increased to 3.8x as
of 30 June 2022 (after IAS 29) vs. 3.0x at the end of 2021 (pre-IAS
29) due to the devaluation of the TRY against the RUB. FX-neutral
leverage ratio stands at 2.3x as of 30 June 2022 (after IAS
29).
In an increasing rate environment, 89% of Group's bank
borrowings had fixed rate whereas average maturity stood at 2.6
years.
The Group had TRY 268 million of cash and access to an
additional banking facility of TRY 157 million.
The Group's sufficient liquidity position enables it to pre-pay
its bank borrowings in Russia, despite the recent devaluation of
TRY, if required. The Group obtained a waiver (related with net
debt/EBITDA ratio) from Sberbank with respect to its covenants for
all four quarters of 2022 and is in negotiations to reset the
covenants or repay the remaining loan. The principal outstanding
amount under the Sberbank loan currently amounts to RUB 0.7
billion, of which RUB 0.02 billion is supported by a cash
collateral deposit.
Board compliance statement
The Board of DP Eurasia N.V. declares that, to the best of their
knowledge, the attached condensed combined and consolidated
financial statements give a true and fair view of the assets,
liabilities, financial position and the result of DP Eurasia N.V.
and its subsidiaries included in the attached condensed combined
and consolidated financial statements and the interim report
includes a fair review of the information required pursuant to
section 5:25d, subsections 8 and 9 of the Dutch Financial Markets
Supervision Act (Wet op het financieel toezicht).
Amsterdam, 28 September 2022
The Directors of DP Eurasia N.V. as at the date of this
announcement are as set out below:
Peter Williams*
Aslan Saranga, Chief Executive Officer
Frederieke Slot, Company Secretary
Shyam S. Bhartia*
Hari S. Bhartia*
David Adams*
Burak Ertas*
Ahmet Ashaboglu*
* Non-Executive Directors
Auditor's Involvement
This Interim Report for the six months ended 30 June 2022, and
the attached condensed consolidated financial statements included
herein have been reviewed but not audited by an external
auditor.
Forward looking statements
This press release includes forward-looking statements which
involve known and unknown risks and uncertainties, many of which
are beyond the Group's control and all of which are based on the
Directors' current beliefs and expectations about future events.
They appear in a number of places throughout this press release and
include all matters that are not historical facts and include
predictions, statements regarding the intentions, beliefs or
current expectations of the Directors or the Group concerning,
among other things, the results of operations, financial condition,
prospects, growth and strategies of the Group and the industry in
which it operates.
No assurance can be given that such future results will be
achieved; actual events or results may differ materially as a
result of risks and uncertainties facing the Group. Such risks and
uncertainties could cause actual results to vary materially from
the future results indicated, expressed, or implied in such
forward-looking statements.
Forward-looking statements contained in this press release speak
only as of the date of this press release. The Company and the
Directors expressly disclaim any obligation or undertaking to
update these forward-looking statements contained in this press
release to reflect any change in their expectations or any change
in events, conditions, or circumstances on which such statements
are based.
Appendices
Exchange Rates
For the period ended 30 June
--------------------------------------
2022 2021
------------------ ------------------
Period Period Period Period
Currency End Average End Average
------- --------- ------- ---------
EUR/TRY 17.522 16.196 10.365 9.485
RUB/TRY 0.321 0.200 0.119 0.105
EUR/RUB 53.858 83.520 86.203 89.547
Delivery - Take away / Eat in mix
For the period ended 30 June
(unaudited)
--------------------------------------------------
2022 2021
------------------------ ------------------------
Turkey Russia Total Turkey Russia Total
75.7 75.9 75.4 83.2 77.2 82.0
Delivery % % % % % %
Take away / 24.3 24.1 24.6 16.8 22.8 18.0
Eat in % % % % % %
Total(2) 100% 100% 100% 100% 100% 100%
DP EURASIA N.V.
(UNAUDITED) CONDENSED CONSOLIDATED
INTERIM FINANCIAL STATEMENTS
AS AT 30 JUNE 2022
Unaudited
DP EURASIA N.V.
(UNAUDITED) CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE
INCOME FOR THE PERIODED 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
(unaudited) (unaudited)
Notes 30 June 2022 30 June 2021
------------------------------------- ------- --------------- ---------------
INCOME OR LOSS
Revenue 4 1,259,480 1,045,326
Cost of sales 4 (868,944) (682,092)
------------------------------------- ------- --------------- ---------------
GROSS PROFIT 390,536 363,234
------------------------------------- ------- --------------- ---------------
General administrative expenses (189,992) (135,451)
Marketing and selling expenses (190,818) (177,547)
Other operating income, net 18,452 (6,923)
------------------------------------- ------- --------------- ---------------
OPERATING PROFIT 28,178 43,313
------------------------------------- ------- --------------- ---------------
Foreign exchange gains 6 123,944 52,035
Financial income 6 20,288 25,061
Financial expense 6 (106,779) (65,166)
------------------------------------- ------- --------------- ---------------
Monetary Gain 74,292 23,579
------------------------------------- ------- --------------- ---------------
PROFIT BEFORE INCOME TAX 139,923 78,822
------------------------------------- ------- --------------- ---------------
Tax expense (52,321) (36,603)
Income tax expense 20 (33,739) (26,660)
Deferred tax expense 20 (18,582) (9,943)
------------------------------------- ------- --------------- ---------------
PROFIT FOR THE PERIOD 87,602 42,219
------------------------------------- ------- --------------- ---------------
OTHER COMPREHENSIVE EXPENSE (182,936) (35,356)
Items that will not be reclassified
to profit or loss
- Remeasurements of post-employment 638 165
benefit obligations, net of tax (147) (41)
Items that may be reclassified
to profit or loss
- Currency translation differences (183,427) (35,480)
------------------------------------- ------- --------------- ---------------
TOTAL COMPREHENSIVE (LOSS)/GAIN (95,334) 6,863
------------------------------------- ------- --------------- ---------------
Profit per share 7 0.60 0.29
------------------------------------- ------- --------------- ---------------
The accompanying notes on pages 6 till 32 form an integral part
of these condensed consolidated interim financial statements.
DP EURASIA N.V.
(UNAUDITED) CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL
POSITION AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
ASSETS Notes (unaudited) (unaudited)
30 June 2022 31 December 2021
--------------------------- ------- --------------- -------------------
Trade receivables 13 12,633 18,630
Lease receivables 10 84,119 95,773
Right-of-use assets 10 315,266 195,556
Property and equipment 8 218,270 193,895
Intangible assets 9 152,655 107,171
Goodwill 11 234,108 219,912
Deferred tax assets 20 46,182 27,529
Other non-current assets 16 79,480 63,691
--------------------------- ------- --------------- -------------------
Non-current assets 1,142,713 922,157
--------------------------- ------- --------------- -------------------
Cash and cash equivalents 12 268,576 223,912
Trade receivables 13 253,164 220,037
Lease receivables 10 29,566 28,787
Inventories 15 326,928 196,880
Other current assets 16 210,162 152,569
--------------------------- ------- --------------- -------------------
Current assets 1,088,396 822,185
--------------------------- ------- --------------- -------------------
TOTAL ASSETS 2,231,109 1,744,342
--------------------------- ------- --------------- -------------------
The accompanying notes form on pages 6 till 32 an integral part
of these condensed consolidated interim financial statements.
DP EURASIA N.V.
(UNAUDITED) CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL
POSITION AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
(unaudited) (unaudited)
LIABILITIES Notes 30 June 2022 31 December 2021
-------------------------------------------- ------- --------------- -------------------
EQUITY
Paid in share capital 19 36,353 36,353
Share premium 390,457 390,457
Contribution from shareholders 63,882 62,221
Other comprehensive income/expense
not to be reclassified to profit or loss
- Remeasurements of post-employment
benefit obligations (4,023) (4,514)
Other comprehensive income/expense
to be reclassified to profit or loss
- Currency translation differences (603,909) (420,482)
Retained earnings 89,590 1,988
-------------------------------------------- ------- --------------- -------------------
Total equity (27,650) 66,023
-------------------------------------------- ------- --------------- -------------------
Financial liabilities 17 273,078 221,372
Lease liabilities 10 345,714 257,663
Long term provisions for
employee benefits 16 6,733 5,965
Deferred tax liability 20 22,656 7,246
Other non-current liabilities 16 74,038 105,485
-------------------------------------------- ------- --------------- -------------------
Non - current liabilities 722,219 597,731
-------------------------------------------- ------- --------------- -------------------
LIABILITIES
Financial liabilities 17 625,863 458,544
Lease liabilities 10 114,814 83,944
Trade payables 13 565,393 362,009
Current income tax liabilities 21,335 18,203
Provisions 4,220 7,716
Other current liabilities 16 204,915 150,172
-------------------------------------------- ------- --------------- -------------------
Current liabilities 1,536,540 1,080,588
-------------------------------------------- ------- --------------- -------------------
TOTAL LIABILITIES 2,258,759 1,678,319
-------------------------------------------- ------- --------------- -------------------
TOTAL LIABILITIES & EQUITY 2,231,109 1,744,342
-------------------------------------------- ------- --------------- -------------------
The accompanying notes form on pages 6 till 32 an integral part
of these condensed consolidated interim financial statements.
DP EURASIA N.V.
(UNAUDITED) CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN
EQUITY FOR THE PERIODED
30 JUNE 2022
Remeasurement
of
Contribution post-employment Currency
Share Share from benefit translation Retained Total
capital premium shareholders obligations differences earnings Equity
----------------- ----------- ------------ ------------- ---------------- ------------ ----------- ------------
Balances at 1
January
2021(unaudited) 36,353 390,457 57,665 (6,991) (288,959) 66,691 255,216
Remeasurements
of
post-employment
benefit
obligations,
net - - - 124 - - 124
Currency
translation
adjustments - - - - (35,480) - (35,480)
Total profit for
the period - - - - - 42,219 42,219
Total
comprehensive
loss - - - 124 (35,480) 42,219 6,863
Share-based
incentive plans - - 2,482 - - - 2,482
----------------- ----------- ------------ ------------- ---------------- ------------ ----------- ------------
Balances at 30
June 2021
(unaudited) 36,353 390,457 60,147 (6,867) (324,439) 108,910 264,561
----------------- ----------- ------------ ------------- ---------------- ------------ ----------- ------------
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
Balances at 1 January 2022 (unaudited) 36,353 390,457 62,221 (4,514) (420,482) 1,988 66,023
----------------------------------------------- ------- -------- ------- -------- ---------- ------- ----------
Remeasurements of post-employment benefit
obligations, net - - - 491 - - 491
Currency translation adjustments - - - - (183,427) - (183,427)
Total profit for the period - - - - - 87,602 87,602
Total comprehensive loss - - - 491 (183,427) 87,602 (95,334)
Share-based incentive plans - - 1,661 - - - 1,661
Balances at 30 June 2022 (unaudited) 36,353 390,457 63,882 (4,023) (603,909) 89,590 (27,650)
----------------------------------------------- ------- -------- ------- -------- ---------- ------- ----------
The accompanying notes form on pages 6 till 32 an integral part
of these condensed consolidated interim financial statements.
DP EURASIA N.V.
(UNAUDITED) CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE PERIODED 30 JUNE 2022 (unaudited)
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
(unaudited) (unaudited)
30 June 30 June
2022 2021
Profit before income tax 139,923 78,822
-------------------------------------------------- ------------- -------------
Adjustments for:
Depreciation 90,644 63,808
Amortisation 26,518 21,652
(Gain)/Loss on sale of property and equipment - 437
Performance bonus accrual 7,850 9,081
Non-cash employee benefits expense - share-based
payments 1,661 2,482
Interest income (20,288) (25,061)
Interest expense 92,518 65,166
Impairment of tangible and intangible
assets 2,999 7,005
Hyperinflation adjustments (139,496) 83,029
Changes in operating assets and liabilities
Changes in trade receivables (27,130) (31,212)
Changes in other receivables and assets (68,630) (57,310)
Changes in inventories (130,048) (54,018)
Changes in contract assets (4,752) (5,906)
Changes in contract liabilities (7,501) 6,694
Changes in trade payables 203,384 72,316
Changes in other payables and liabilities 47,508 35,703
Income taxes paid (30,607) (25,104)
Performance bonuses paid (26,946) (15,690)
Cash flows generated from operating activities 157,607 231,894
-------------------------------------------------- ------------- -------------
Purchases of property and equipment (16,287) (10,933)
Purchases of intangible assets (40,880) (28,736)
Disposals from sale of tangible and intangible
assets 11,797 438
Cash flows used in investing activities (45,370) (39,231)
-------------------------------------------------- ------------- -------------
Interest paid (71,179) (57,833)
Interest on leases paid (18,652) (7,395)
Interest received 9,597 3,994
Loans obtained 722,274 488,445
Loans paid (481,492) (497,496)
Payment of lease liabilities (57,287) (44,905)
Cash flows (used in)/generated from financing
activities 103,261 (115,189)
-------------------------------------------------- ------------- -------------
Effect of currency translation differences (97,079) (13,054)
Net increase in cash and cash equivalents 118,419 (64,420)
-------------------------------------------------- ------------- -------------
Effects of inflation on cash and cash
equivalents (73,755) (124,310)
-------------------------------------------------- ------------- -------------
Cash and cash equivalents at the beginning
of the period 223,912 202,640
-------------------------------------------------- ------------- -------------
Cash and cash equivalents at the end
of the period 268,576 142,751
-------------------------------------------------- ------------- -------------
The accompanying notes on pages 6 till 32 form an integral part
of these condensed consolidated interim financial statement
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 1 - GROUP'S ORGANIZATION AND NATURE OF ACTIVITIES
DP Eurasia N.V. (the "Company"), public limited company, having
its statutory seat in Amsterdam, the Netherlands, was incorporated
under the law of the Netherlands on 18 October 2016. The Company
has been incorporated by integrating shares of Fides Food Systems
Coöperatief U.A. and Vision Lovemark Coöperatief U.A. in Fidesrus
B.V. and Fides Food Systems B.V. Acquisitions occurred on
18 October 2016 when the Company acquired Fidesrus and Fides
Foods and their subsidiaries and from this point forward
consolidated Group was formed. This was a transaction under common
control.
The Company's registered address is: Herikerbergweg 238,
Amsterdam, the Netherlands.
The Company and its subsidiaries (together referred as the
"Group") operate corporate-owned and franchise-owned stores in
Turkey and the Russian Federation, including providing technical
support, control and consultancy services to the franchisees.
As at 30 June 2022, the Group, including Coffy, hold franchise
operating and sub-franchising right in 842 stores (651 franchise
stores, 191 corporate-owned stores) (31 December 2021: 817 stores
(618 franchise stores, 199 corporate-owned stores).
Subsidiaries
The Company has a total of four fully owned subsidiaries. The
entities included in the scope of the condensed consolidated
financial interim information and nature of their business is as
follows:
30 June 30 June
2022 2021
Effective Effective
Subsidiaries ownership (%) ownership (%) Registered country Nature of business
-------------------------------------------- -------------- -------------- ------------------- -------------------
Pizza Restaurantları A. . ( " Domino's
Turkey " ) 100 100 Turkey Food delivery
Pizza Restaurants LLC ( " Domino's Russia "
) 100 100 Russia Food delivery
Fidesrus B.V. ( " Fidesrus " ) 100 100 the Netherlands Investment company
Fides Food Systems B.V. ( " Fides Food " ) 100 100 the Netherlands Investment company
Pizza Restaurants LLC is established in the Russian Federation.
Domino's Russia is operating a pizza delivery network of company
and franchise-owned stores in Russian Federation. Domino's Russia
has a Master Franchise Agreement (the "MFA Russia") with Domino's
Pizza International for the pizza delivery network in Russia until
2030.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 1 - GROUP'S ORGANIZATION AND NATURE OF ACTIVITIES
(Continued)
Pizza Restaurantları A. . ("Domino's Turkey") is established in
Turkey. Domino's Turkey is operating a pizza delivery network of
corporate and franchised stores in Turkey. Domino's Turkey is a
food delivery company, which has a Master Franchise Agreement (the
"MFA Turkey") with Domino's Pizza International pizza delivery
network in Turkey until 2032. The Group expects the terms of the
MFAs to be extended.
Fides Food and Fidesrus are established in the Netherlands. Both
Fides Food Systems and Fidesrus are acting as investment
companies.
Significant changes in the current reporting period
The condensed interim consolidated financial statements have
been prepared assuming that the Group will continue as a going
concern and be able to realise its assets and discharge its
liabilities in the normal course of business. The Group recorded a
net gain of TRY 87,602 for the first half of 2022. The Group's
current liabilities exceed its current assets by TRY 448,144 as of
30 June 2022. The Group realized operating profit of TRY 28,178 for
the first half of 2022.
As previously announced, the Group continues to limit investment
into the territory and is focused on optimising the store coverage
in Russia. The Group continues to monitor the situation in the
region closely while the safety and welfare of all the Group's
employees and customers remains our primary priority
Due to continuing operating loss in Russia, financial covenants
of Groups Russia loan facility have not been met but the Group was
able to obtain waiver (related with net debt to EBITDA ratio) for
all four quarters of 2022.
However, trading performance across the Group has continued its
momentum throughout the first half of the year, with net 29 stores
including Coffy stores of 7, being opened in Turkey, Russia,
Azerbaijan and Georgia.
NOTE 2 - BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS
2.1 Basis of preparation
These condensed consolidated interim financial statements for
the six months period ended
30 June 2022 have been prepared in accordance with International
Accounting Standard 34 ("IAS 34") Interim Financial Reporting.
The interim report does not include all the notes of the type
normally included in the annual financial statements. Accordingly,
this report is to be read in conjunction with the annual report for
the year ended 31 December 2021. These condensed interim financial
statements were approved for issue on 28 September 2022. The
financial statements have been reviewed, not audited.
The accounting policies adopted in the preparation of the
interim condensed consolidated financial statements are consistent
with those followed in the preparation of the Group's annual
financial statements for the year ended 31 December 2021, except
for the application of the IAS 29 "Financial Reporting in
Hyperinflationary Economies" and the new or revised standards,
amendments and/or interpretations that are mandatory for the
periods beginning on or after 1 January 2022.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 2 - BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS
(Continued)
Application of IAS 29 - Hyperinflation in Turkey
The Turkish economy has been designated as a hyperinflationary
economy in the first half of 2022 and, as a result, IAS 29
"Financial Reporting in Hyperinflationary Economies" has become
applicable to the
Group's subsidiaries (Domino's Turkey), whose functional
currency is the Turkish Lira. IAS 29 requires companies to report
the results of the operations in Turkey, as if these were highly
inflationary as of 1 January 2022. Specifically, IAS 29
requires:
- Adjustment of historical cost of the non-monetary assets and
liabilities for the change in purchasing power caused by inflation
from the date of initial recognition to the end of the reporting
date;
- Non-adjustment of the monetary assets and liabilities, as they
are already expressed in the measuring unit current at the end of
the reporting period;
- Adjustment of the income statement for inflation and its
translation with the average index rate;
- Recognition of gain or loss on net monetary position in profit
or loss in order to reflect the impact of inflation rate movement
on holding monetary assets and liabilities in local currency.
IAS 29 requires that financial statements prepared in the
currency of a hyperinflationary economy be stated in terms of the
measuring unit current at the balance sheet date, and that
corresponding figures for previous periods be restated in the same
terms. The restatement of the comparative amounts was calculated by
means of conversion factors derived from the Turkish nationwide
consumer price index ("CPI") published by the State Institute of
Statistics ("SIS"). Indices and conversion factors used to restate
the comparative amounts until 30 June 2022 are given below:
Cumulative three-year
Date Index Conversion factor inflation rate
30 June 2022 977.90 1,0000 136.4%
31 December 2021 686.95 1.4235 74.4%
31 December 2020 504.81 1.9372 54.2%
The financial statements of Group's subsidiaries, whose
functional currency is the currency of a hyperinflationary economy,
are adjusted for inflation and prior year comparatives have been
restated for hyperinflation in the consolidated financial
statements.
In the consolidated income statement for the six months ended on
30 June 2022, the Group recognized a total gain on net monetary
position of TRY 74,292 thousands.
On the application of IAS 29, the Group used the conversion
coefficient derived from the consumer price index published by
Turkish Statistics Institute (TUIK). The conversion coefficient was
977.90 and 686.95 on 30 June 2022 and 31 December 2021
respectively.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 2 - BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS (Continued)
Seasonality of operations
There is no significant seasonality effect on the Group's
revenue. According to financial year ended
31 December 2021, 46% of revenues accumulated in the first half
year, with 54% accumulating in the second half.
Consolidation of foreign subsidiaries
Financial statements of subsidiaries operating in foreign
countries are prepared in the currency of the primary economic
environment in which they operate. Assets and liabilities in
financial statements prepared according to the Group's accounting
policies are translated into the Group's presentation currency,
Turkish Liras ('TRY'), from the foreign exchange rate at the
statement of financial position date whereas income and expenses
are translated into TRY at the average foreign exchange rate.
Exchange differences arising from the translation are included in
the "currency translation differences" under shareholders'
equity.
The foreign currency exchange rates used in the translation of
the foreign operations within the scope of consolidation are as
follows:
30 June 2022 31 December 30 June 2021
2021
------------------ ------------------ ------------------
Period Period Period Period Period Period
Currency End Average End Average End Average
Euros 17.5221 16.1964 14.6823 10.4408 10.3645 9.4860
Russian Roubles 0.3209 0.2004 0.1730 0.1196 0.1194 0.1053
2.2 New and amended international financial reporting standards as adopted by European Union
New and amended standards adopted by the Group, which are
effective for the interim financial statements as at 30 June
2022
A number of new or amended standards became applicable for the
current reporting period:
- Amendment to IFRS 16, 'Leases' - Covid-19 related rent
concessions Extension of the Practical expedient
- Amendments to IFRS 7 and IFRS 16 Interest Rate Benchmark Reform Phase 2
- Amendments to IAS 12.7 Deferred Tax related to Assets and
Liabilities arising from a Single Transaction
These standards did not have any impact on the Group's
accounting policies and did not require retrospective
adjustments.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 2 - BASIS OF PRESENTATION OF INTERIM FINANCIAL STATEMENTS (Continued)
The new standards, amendments and interpretations, which are
issued but not effective for the interim financial statements as at
30 June 2022
A number of narrow-scope amendments to IFRS 3, IAS 16, IAS 37
and some annual improvements on IFRS 1, IFRS 9, IAS 41 and IFRS
16
- Amendments to IFRS 3, 'Business combinations'
- Amendments to IAS 16, 'Property, plant and equipment'
- Amendments to IAS 37, 'Provisions, contingent liabilities and contingent assets'
- Amendments to IAS 1, Presentation of financial statements'
- Narrow scope amendments to IAS 1, Practice statement 2 and IAS 8
- Amendment to IAS 12 - Deferred tax related to assets and
liabilities arising from a single transaction;
These standards are not expected to have any impact on the
Group's accounting policies.
NOTE 3 - SEGMENT REPORTING
The business operations of the Group are organised and managed
with respect to geographical positions of its operations. The
information regarding the business activities of the Group as of 30
June 2022 and 2021 comprise the performance and the management of
its Turkish and Russian operations and head office.
The Group has two business segments, determined by management
according to the information used for the evaluation of performance
and the allocation of resources, the Turkish and Russian
operations. Other operations are composed of corporate expenses of
Dutch companies. These segments are managed separately because they
are affected by the economic conditions and geographical positions
in terms of risks and returns.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 3 - SEGMENT REPORTING (Continued)
The segment analysis for the periods ended 30 June 2022 and 2021
are as follows:
1 January - 30 June 2022 Turkey Russia Other Total
----------------------------------------------------------------- --------- --------- --------- ----------
Corporate revenue 208,896 192,714 - 401,610
Franchise revenue and royalty revenue obtained from franchisees 593,135 130,720 - 723,855
Other revenue 115,290 18,725 - 134,015
Total revenue 917,321 342,159 - 1,259,480
- At a point in time 867,260 340,972 - 1,208,232
- Over time 50,061 1,187 - 51,248
----------------------------------------------------------------- --------- --------- --------- ----------
Operating profit 89,557 (44,993) (16,386) 28,178
Capital expenditures 38,210 18,957 - 57,167
Tangible and intangible disposals (2,963) (5,833) - (8,796)
Depreciation and amortization expenses (60,801) (56,360) - (117,161)
----------------------------------------------------------------- --------- --------- --------- ----------
Adjusted EBITDA 152,492 13,914 (13,406) 153,000
----------------------------------------------------------------- --------- --------- --------- ----------
1 January - 30 June 2022 Turkey Russia Other Total
----------------------------------------------------------------- --------- --------- --------- ----------
Borrowings
TRY 578,007 - - 578,007
RUB - 214,557 106,377 320,934
----------------------------------------------------------------- --------- --------- --------- ----------
578,007 214,557 106,377 898,941
----------------------------------------------------------------- --------- --------- --------- ----------
Lease liabilities
TRY 148,860 - - 148,860
RUB - 311,668 - 311,668
----------------------------------------------------------------- --------- --------- --------- ----------
148,860 311,668 - 460,528
Total 726,864 526,225 106,380 1,359,469
----------------------------------------------------------------- --------- --------- --------- ----------
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 3 - SEGMENT REPORTING (Continued)
1 January - 30 June 2021 Turkey Russia Other Total
----------------------------------------------------------------- --------- --------- -------- ----------
Corporate revenue 247,161 136,831 - 383,992
Franchise revenue and royalty revenue obtained from franchisees 547,397 61,022 - 608,419
Other revenue 46,795 6,120 - 52,915
Total revenue 841,353 203,973 - 1,045,326
- At a point in time 833,978 202,786 - 1,036,764
- Over time 7,375 1,187 - 8,562
----------------------------------------------------------------- --------- --------- -------- ----------
Operating profit 88,796 (38,739) (6,744) 43,313
Capital expenditures 56,843 6,038 - 62,881
Tangible and intangible disposals (1,229) (1,342) - (2,571)
Depreciation and amortization expenses (47,417) (38,042) - (85,459)
----------------------------------------------------------------- --------- --------- -------- ----------
Adjusted EBITDA 138,694 12,854 (6,744) 144,804
----------------------------------------------------------------- --------- --------- -------- ----------
1 January - 30 June 2021 Turkey Russia Other Total
----------------------------------------------------------------- --------- --------- -------- ----------
Borrowings
TRY 468,595 - - 468,595
RUB - 148,827 62,494 211,321
----------------------------------------------------------------- ----------
468,595 148,827 62,494 679,916
----------------------------------------------------------------- --------- --------- -------- ----------
Lease liabilities
TRY 202,376 - - 202,376
RUB - 139,231 - 139,231
----------------------------------------------------------------- --------- --------- -------- ----------
202,376 139,231 - 341,607
670,971 288,058 62,494 1,021,523
----------------------------------------------------------------- --------- --------- -------- ----------
EBITDA, adjusted EBITDA, net debt, adjusted net debt, adjusted
net income and non-recurring and non-trade income/expenses are not
defined by IFRS. The amounts provided with respect to operating
segments are measured in a manner consistent with that of the
financial statements. These items determined by the principles
defined by Group management comprise income/expenses which are
assumed by the Group management to not be part of the normal course
of business and are non-recurring items. These items which are not
defined by IFRS are disclosed by Group management separately for a
better understanding and measurement of the sustainable performance
of the Group.
.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 3 - SEGMENT REPORTING (Continued)
The reconciliation of adjusted EBITD As as of 30 June 2022 and
June 2021 is as follows:
Turkey 30 June 2022 30 June 2021
------------------------------------------------------------------------ ------------- -------------
Adjusted EBITDA (*) 152,492 138,694
------------------------------------------------------------------------ ------------- -------------
Non-recurring and non-trade (income)/expenses per Group Management (*)
One off non-trading costs (**) 473 -
Share-based incentives 1,661 2,482
------------------------------------------------------------------------ ------------- -------------
EBITDA 150,358 136,212
------------------------------------------------------------------------ ------------- -------------
Depreciation and amortization (60,801) (47,417)
------------------------------------------------------------------------ ------------- -------------
Operating profit 89,557 88,795
------------------------------------------------------------------------ ------------- -------------
Russia 30 June 2022 30 June 2021
------------------------------------------------------------------------ ------------- -------------
Adjusted EBITDA (*) 13,914 12,854
------------------------------------------------------------------------ ------------- -------------
Non-recurring and non-trade (income)/expenses per Group Management (*)
One off non-trading costs (**) 2,547 13,551
EBITDA 11,367 (697)
------------------------------------------------------------------------ ------------- -------------
Depreciation and amortization (56,360) (38,042)
------------------------------------------------------------------------ ------------- -------------
Operating profit (44,993) (38,739)
------------------------------------------------------------------------ ------------- -------------
(*) EBITDA, adjusted EBITDA and non-recurring and non-trade
income/expenses are not defined by IFRS. These items are determined
by the principles defined by Group management and comprise
income/expenses which are assumed by Group management to not be
part of the normal course of business and are non-trading items.
These items, which are not defined by IFRS, are disclosed by Group
management separately for a better understanding and measurement of
the sustainable performance of the Group.
(**) The reason for the significant increase in one-off
non-trading costs is mainly related to impairment expenses of the
tangible and intangible assets and con sultancy expenses due to
cost reduction program.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 3 - SEGMENT REPORTING (Continued)
Other 30 June 2022 30 June 2021
-------------------------------------------------------------------- ------------- -------------
Adjusted EBITDA (*) (13,406) (6,744)
-------------------------------------------------------------------- ------------- -------------
Non-recurring and non-trade (income)/expenses per Group Management
One off non-trading costs 2,980 -
-------------------------------------------------------------------- ------------- -------------
EBITDA (16,386) (6,744)
-------------------------------------------------------------------- ------------- -------------
Depreciation and amortization - -
-------------------------------------------------------------------- ------------- -------------
Operating profit (16,386) (6,744)
-------------------------------------------------------------------- ------------- -------------
(*) EBITDA, adjusted EBITDA and non-recurring and non-trade
income/expenses are not defined by IFRS. These items are determined
by the principles defined by the Group management and comprise
income/expenses which are assumed by Group management to not be
part of the normal course of business and are non-trading items.
These items, which are not defined by IFRS, are disclosed by Group
management separately for a better understanding and measurement of
the sustainable performance of the Group.
The reconciliation of adjusted net income as of 30 June 2022 and
2021 is as follows:
2022 2021
-------------------------------------------------------------------- ------- -------
Profit for the period as reported 87,602 42,219
-------------------------------------------------------------------- ------- -------
Non-recurring and non-trade (income)/expenses per Group Management
Share-based incentives 1,661 2,482
One-off expenses 6,000 13,551
-------------------------------------------------------------------- ------- -------
Adjusted net profit for the period 95,263 58,252
-------------------------------------------------------------------- ------- -------
(*) Adjusted net income and non-recurring and non-trade
income/expenses are not defined by IFRS. Adjusted net income
excludes income and expenses which are not part of the normal
course of business and are non-recurring items. Management uses
this measurement basis to focus on core trading activities of the
business segments, and to assist it in evaluating underlying
business performance.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 4 - REVENUE AND COST OF SALES
30 June 2022 30 June 2021
Corporate revenue 401,610 383,992
Franchise revenue and royalty
revenue obtained from franchisees 723,855 608,419
Other revenue 134,015 52,915
-----------------------------------
Revenue 1,259,480 1,045,326
----------------------------------- ------------- -------------
Cost of sales (868,944) (682,092)
----------------------------------- ------------- -------------
Gross profit 390,536 363,234
----------------------------------- ------------- -------------
(*) Other revenue mainly includes handover income, IT income and
other income from franchisee.
NOTE 5 - EXPENSES BY NATURE
30 June 2022 30 June 2021
Employee benefit expenses (*) (218,337) (246,870)
Depreciation and amortization expenses (*) (117,161) (85,459)
--------------------------------------------
(335,498) (332,329)
-------------------------------------------- ------------- -------------
(*) These expenses are accounted in cost of sales, general
administration expenses and marketing expenses.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 6 - FOREIGN EXCHANGE GAINS, FINANCIAL INCOME AND
EXPENSES
Foreign exchange gains 30 June 2022 30 June 2021
--------------------------------------- ------------- -------------
Foreign exchange gains, net 123,944 52,035
--------------------------------------- ------------- -------------
123,944 52,035
--------------------------------------- ------------- -------------
Financial income 30 June 2022 30 June 2021
--------------------------------------- ------------- -------------
Interest income on lease liabilities 10,691 10,416
Interest income 9,597 14,645
--------------------------------------- ------------- -------------
20,288 25,061
--------------------------------------- ------------- -------------
Financial expense 30 June 2022 30 June 2021
--------------------------------------- ------------- -------------
Interest expense (73,866) (53,203)
Interest expense on lease liabilities (18,652) (7,395)
Other (14,261) (4,568)
(106,779) (65,166)
--------------------------------------- ------------- -------------
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 7 - EARNINGS (LOSS) PER SHARE
The reconciliation of adjusted profit per share as of 30 June
2022 and 2021 is as follows:
30 June 2022 30 June 2021
-------------------------------------- ------------- -------------
Average number of shares existing
during the period 145,372 145,372
Net gain for the period attributable
to
equity holders of the parent 87,602 42,219
-------------------------------------- ------------- -------------
Earnings per share 0.60 0.29
-------------------------------------- ------------- -------------
The reconciliation of adjusted earnings per share as of 30 June
2022 and 2021 is as follows:
30 June 2022 30 June 2021
---------------------------------------- ------------- -------------
Average number of shares existing
during the period 145,372 145,372
Net profit for the period attributable
to equity
holders of the parent 87,602 42,219
---------------------------------------- ------------- -------------
Non-recurring and non-trade expenses
per Group Management (*)
Share-based incentives 1,661 2,482
One-off expenses 6,000 13,551
---------------------------------------- ------------- -------------
Adjusted net gain for the period
attributable to equity holders
of the parent 95,263 58,252
---------------------------------------- ------------- -------------
Adjusted Earnings per share (*) 0.66 0.40
---------------------------------------- ------------- -------------
(*) Adjusted earnings per share non-recurring and non-trade
income/expenses are not defined by IFRS. The amounts provided with
respect to operating segments are measured in a manner consistent
with that of the financial statements. These items determined by
the principles defined by the Group management comprises
incomes/expenses which are assumed by the Group management that are
not part of the normal course of business and are non-recurring
items. These items which are not defined by IFRS are disclosed by
the Group management separately for a better understanding and
measurement of the sustainable performance of the Group.
There are no shares or options with a dilutive effect and hence
the basic and diluted earnings per share are the same.
The earning/ (loss) per share presented for the period ended 30
June 2022 is based on the issued share capital of DP Eurasia N.V.
as at 30 June 2022.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 8 - PROPERTY AND EQUIPMENT
Currency
translation
1 January 2022 Additions Disposals Transfers Impairment adjustments 30 June 2022
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
Cost
Machinery and
equipment 154,628 6,548 (7,269) 3,946 - 92,716 250,569
Motor vehicles 50,884 - - 100 - 331 51,315
Furniture and fixtures 244,436 7,120 (37,079) - - 6,588 221,065
Leasehold improvements 323,698 2,246 (11,769) (4,046) - 63,646 373,775
Construction in
progress 5,423 373 (375) - - (2,327) 3,094
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
779,069 16,287 (56,492) - - 160,954 899,818
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
Accumulated
depreciation
Machinery and
equipment (91,557) (10,346) 4,158 - - (55,671) (153,416)
Motor vehicles (32,863) (4,973) - - - (379) (38,215)
Furniture and fixtures (182,244) (9,608) 35,011 - - (4,507) (161,348)
Leasehold improvements (278,510) (12,497) 9,982 - - (47,544) (328,569)
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
(585,174) (37,424) 49,151 - - (108,101) (681,548)
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
Net book value 193,895 218,270
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
For the period ended 30 June 2022, depreciation expense of TRY
22,829 has been charged in cost of sales and TRY 14,595 has been
charged in general administrative expenses.
DP EURASIA N.V.
NOTES TO THE ( UNAUDITED ) CONDENSED CONSOLIDATED INTERIM
FINANCIALSTATEMENTS AS AT 30 JUNE 2022
(Amounts expressed in thousands of Turkish Lira (TRY) unless
otherwise stated.)
NOTE 8 - PROPERTY AND EQUIPMENT (Continued)
Currency
translation
1 January 2021 Additions Disposals Transfers Impairment adjustments 30 June 2021
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
Cost
Machinery and
equipment 115,232 2,220 (1,801) 49 - 15,417 131,117
Motor vehicles 57,254 23,212 (3,844) 11 - 6,422 83,055
Furniture and fixtures 229,767 6,167 (3,538) 1,322 - 1,170 234,888
Leasehold improvements 257,777 2,074 (1,788) (598) (5,446) 12,776 264,795
Construction in
progress 5,021 473 - (784) - 147 4,857
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
665,051 34,146 (10,971) - (5,446) 35,932 718,712
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
Accumulated
depreciation
Machinery and
equipment (60,453) (7,542) 896 - - (7,991) (75,090)
Motor vehicles (47,347) (6,939) 3,844 - - (5,170) (55,612)
Furniture and fixtures (163,866) (9,644) 2,310 - - (552) (171,752)
Leasehold improvements (206,354) (11,293) 1,350 - 3,525 (7,436) (220,208)
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
(478,020) (35,418) 8,400 - 3,525 (21,149) (522,662)
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
Net book value 187,031 196,050
----------------------- --------------- ---------- ---------- ---------- ----------- ------------ -------------
For the period ended 30 June 2021, depreciation expense of TRY
24,439 has been charged in cost of sales and TRY 10,979 has been
charged in general administrative expenses.
NOTE 9 - INTANGIBLE ASSETS
Currency
1 January translation 30 June
2022 Additions Disposals adjustments 2022
-------------------------- ---------- ---------- ---------- ------------ ----------
Cost
Key money 58,176 2,618 (6,037) 5,885 60,642
Computer software 307,282 38,262 (5,999) 56,753 396,298
Franchise contracts 264,769 - - - 264,769
-------------------------- ---------- ---------- ---------- ------------ ----------
630,227 40,880 (12,036) 62,638 721,709
-------------------------- ---------- ---------- ---------- ------------ ----------
Accumulated depreciation
Key money (41,428) (4,545) 4,825 (1,949) (43,097)
Computer software (216,859) (21,972) 5,756 (28,113) (261,188)
Franchise contracts (264,769) - - - (264,769)
-------------------------- ---------- ---------- ---------- ------------ ----------
(523,056) (26,517) 10,581 (30,062) (569,054)
-------------------------- ---------- ---------- ---------- ------------ ----------
Net book value 107,171 152,655
-------------------------- ---------- ---------- ---------- ------------ ----------
For the period ended 30 June 2022, amortisation expense of
TRY16,176 has been charged in cost of sales and TRY10,341 has been
charged in general administrative expenses.
Currency
1 January translation 30 June
2021 Additions Disposals Impairment adjustments 2021
-------------------------- ---------- ---------- ---------- ----------- ------------ ----------
Cost
Key money 80,280 481 - (2,280) 2,903 81,384
Computer software 228,456 28,255 (740) (589) 7,423 262,805
Franchise contracts 263,859 - - - - 263,859
-------------------------- ---------- ---------- ---------- ----------- ------------ ----------
572,595 28,736 (740) (2,869) 10,326 608,048
-------------------------- ---------- ---------- ---------- ----------- ------------ ----------
Accumulated depreciation
Key money (39,613) (5,666) - 737 (723) (45,265)
Computer software (167,391) (15,986) 740 437 (3,284) (185,484)
Franchise contracts (263,859) - - - - (263,859)
-------------------------- ---------- ---------- ---------- ----------- ------------ ----------
(470,863) (21,652) 740 1,174 (4,007) (494,608)
-------------------------- ---------- ---------- ---------- ----------- ------------ ----------
Net book value 101,732 113,440
-------------------------- ---------- ---------- ---------- ----------- ------------ ----------
For the period ended 30 June 2021, amortisation expense of TRY
14,939 has been charged in cost of sales and TRY 6,713 has been
charged in general administrative expenses.
NOTE 10 - RIGHT OF USE ASSETS
Details of right-of-use assets as of 30 June 2022 and 31
December 2021 are as follows :
30 June 2022 31 December 2021
Right-of-use assets
Properties and vehicles 315,266 195,556
315,266 195,556
------------------------- ------------- -----------------
Details of lease receivable as of 30 June 2022 and 31 December
2021 are as follows :
30 June 2022 31 December 2021
Lease receivables
Current 29,566 28,787
Non-current 84,119 95,773
113,685 124,560
------------------- ------------- -----------------
Details of lease liabilities as of 30 June 2022 and 31 December
2021 are as follows :
30 June 2022 31 December 2021
Lease liabilities
Current 114,814 83,944
Non-current 345,714 257,663
460,528 341,607
------------------- ------------- -----------------
The movement of right-of-use assets as of 30 June 2022 and 2021
are as follows:
2022 2021
Opening - 1 January 195,556 162,655
Depreciation (53,220) (28,389)
Current year additions 74,616 22,326
Current year disposals (6,000) (14,199)
Currency translation adjustments 104,314 23,868
---------------------------------- --------- ---------
Closing - 30 June 315,266 166,261
---------------------------------- --------- ---------
For the period ended 30 June 2022, amortisation expense of
TRY32,464 has been charged in cost of sales and TRY20,756 has been
charged in general administrative expenses (30 June 2021: TRY19,718
and TRY8,671, respectively).
NOTE 11 - GOODWILL
30 June 2022 31 December 2021
1 January 219,912 191,600
Currency translation impact 14,196 28,312
----------------------------- ------------- -----------------
30 June 234,108 219,912
----------------------------- ------------- -----------------
These Goodwill relates to Turkish and Russian cash generating
units at the amounts TRY 203,293 and TRY 30,815 respectively (31
December 2021: TRY203,293 and TRY16,619 (RUB96,016)
respectively).
NOTE 12 - CASH AND CASH EQUIVALENTS
The details of cash and cash equivalents as of 30 June 2022 and
31 December 2021 are as follows:
30 June 31 December
2022 2021
Cash 1,644 2,124
Banks 99,095 105,233
Bank Term bank deposits (less than
three months) 153,002 103,918
Credit card receivables 14,835 12,637
------------------------------------ -------- ------------
268,576 223,912
------------------------------------ -------- ------------
Maturity term of credit card receivables are 30 days on average
(31 December 2021: 30 days).
NOTE 13 - TRADE RECEIVABLES AND PAYABLES
a) Short-term trade receivables
30 June 31 December
2022 2021
Trade receivables 223,176 186,777
Post-dated cheques 29,988 33,260
----------------------------------- -------- ------------
Short-term trade receivables, net 253,164 220,037
----------------------------------- -------- ------------
The average collection period for trade receivables is between
30 and 60 days (2021: 30 and 60 days).
b) Long-term trade receivables
30 June 2022 31 December 2021
Trade receivables 4,773 2,096
Post-dated cheques 7,860 16,534
-------------------- ------------- -----------------
12,633 18,630
-------------------- ------------- -----------------
(*) Post-dated cheques are the receivables from franchisees resulting from store openings.
c) Short-term trade and other payables
30 June 2022 31 December 2021
Trade payables 544,686 354,912
Other payables 20,707 7,097
---------------- ------------- -----------------
565,393 362,009
---------------- ------------- -----------------
The weighted average term of trade payables is less than three
months. Short-term payables with no stated interest are measured at
original invoice amount unless the effect of imputing interest is
significant.
NOTE 14 - TRANSACTIONS WITH RELATED PARTIES
Key management compensation
30 June 2022 30 June 2021
------------------------------ ------------- -------------
Short-term employee benefits 24,150 35,868
Share-based incentives 1,661 2,482
------------------------------ ------------- -------------
25,811 38,350
------------------------------ ------------- -------------
There are no loans, advance payments or guarantees given to key
management.
NOTE 15 - INVENTORIES
30 June 2022 31 December 2021
Raw materials 322,895 193,721
Other inventory 4,033 3,159
----------------- ------------- -----------------
326,928 196,880
----------------- ------------- -----------------
NOTE 16 - OTHER ASSETS AND LIABILITIES
Other current receivables and assets 30 June 2022 31 December 2021
------------------------------------------------------ ------------- -----------------
Advance payments (1) 158,452 102,754
Lease receivables 29,566 28,787
Prepaid taxes and VAT receivable 7,904 24
Prepaid marketing expenses 11,756 8,517
Prepaid insurance expenses 9,940 3,014
Deposits for loan guarantees (2) 5,589 35,527
Contract assets related to franchising contracts (3) 1,965 1,441
Other 14,556 1,292
------------------------------------------------------ ------------- -----------------
Total 239,728 181,356
------------------------------------------------------ ------------- -----------------
(1) As of 30 June 2022, advance payments are composed of
advances given to suppliers for the purchasing raw material and
other services.
(2) The Group repaid a portion of its loans to Sberbank Moscow
and the TRY 5,589 (RUB 17 million) by using promisory note given as
collateral by Fidesrus
(3) The Group incurs certain costs with Domino's Pizza
International related to the set-up of each franchise contract and
IT systems used for recording of franchise revenue.
NOTE 16 - OTHER ASSETS AND LIABILITIES (Continued)
Other non-current receivable and assets
30 June 2022 31 December 2021
----------------------------------------------------- ------------- -----------------
Lease receivables 84,119 95,773
Prepaid marketing expenses 50,201 42,148
Contract assets related to franchising contracts(*) 10,263 6,035
Deposits given 19,016 15,508
Total 163,599 159,464
----------------------------------------------------- ------------- -----------------
(*) The Group incurs certain costs with Domino's Pizza
International related to the set-up of each franchise contract and
IT systems used for recording of franchise revenue.
Other current liabilities
30 June 2022 31 December 2021
------------------------------------------------- ------------- -----------------
Performance bonuses 7,850 26,946
Unused vacation liabilities 23,229 13,807
Payable to personnel 18,928 14,725
Contract liabilities from franchising contracts 82,482 43,939
Volume rebate advances 3,058 3,424
Taxes and funds payable 27,971 13,819
Advances received from franchisees 3,910 6,314
Social security premiums payable 13,550 7,600
Other expense accruals 23,937 19,598
------------------------------------------------- ------------- -----------------
Total 204,915 150,172
------------------------------------------------- ------------- -----------------
Other non-current liabilities
30 June 2022 31 December 2021
------------------------------------------------- ------------- -----------------
Contract liabilities from franchising contracts 35,691 81,735
Unearned Revenue 31,390 19,119
Long term provisions for
employee benefits 6,733 5,965
Other 6,957 4,631
------------------------------------------------- ------------- -----------------
Total 80,771 111,450
------------------------------------------------- ------------- -----------------
NOTE 17 - FINANCIAL LIABILITIES
30 June 31 December
2022 2021
Short term bank borrowings 625,325 348,969
--------------------------------------------- ---------- ------------
Short-term financial liabilities 625,325 348,969
--------------------------------------------- ---------- ------------
Short-term portions of long-term borrowings 538 109,575
Short-term portions of long-term leases 114,814 83,944
---------------------------------------------
Current portion of long-term financial
liabilities 115,352 193,519
--------------------------------------------- ---------- ------------
Total short-term financial liabilities 740,677 542,488
--------------------------------------------- ---------- ------------
Long-term bank borrowings 273,078 221,372
Long-term leases 345,714 257,663
---------------------------------------------
Long-term financial liabilities 618,792 479,035
--------------------------------------------- ---------- ------------
Total financial liabilities 1,359,469 1,021,523
--------------------------------------------- ---------- ------------
30 June 2022
Currency Maturity Interest rate (%) Short-term Long-term
---------------- ---------- ----------------------- ----------- ----------
TRY borrowings 2023 22.0% 578,007 -
RUB borrowings 2024 3mMosPrime+%2.95-9.70% 47,856 273,078
---------------- ---------- ----------------------- ----------- ----------
625,863 273,078
--------------------------- ----------------------- ----------- ----------
NOTE 17 - FINANCIAL LIABILITIES (Continued)
31 December 2021
Currency Maturity Interest rate (%) Short-term Long-term
---------------- ---------- -------------------- ----------- ----------
TRY borrowings 2023 19.14% 411,280 57,315
3mMosPrime+%2.95-9.
RUB borrowings 2024 70% 47,264 164,057
---------------- ---------- -------------------- ----------- ----------
458,544 221,372
--------------------------- -------------------- ----------- ----------
The loan agreement between Sberbank Moscow and Domino's Russia
is subject to covenant clauses whereby the Group, Domino's Turkey
and Domino's Russia are required to meet certain ratios. The
financial indicator of:
-- Domino's Russia, which requires the ratio of financial debt
to adjusted EBITDA for the relevant period should not be more than
3.0;
-- Domino's Turkey, which requires the ratio of financial debt
to adjusted EBITDA for the relevant period should not be more than
2.5; and
-- the Group, which requires the ratio of financial debt to
adjusted EBITDA for the relevant period, should not be more than
3.5.
The loan agreement between Sberbank Moscow and Domino's Russia
is subject to covenant clauses whereby Group, Turkish and Russian
Divisions are required to meet certain ratios. As of 30 June 2022,
Sberbank has waived the covenant conditions for 2021 year end, as
well as the first, second, third and fourth quarters of 2022.
The redemption schedule of the borrowings as of 30 June 2022 and
31 December 2021 is as follows:
30 June 31 December
2022 2021
To be paid in one year 625,863 458,544
To be paid between one to two years 199,506 112,129
To be paid between two to three
years 73,572 109,243
------------------------------------- -------- ------------
898,941 679,916
------------------------------------- -------- ------------
The details of the finance lease liabilities as of 30 June 2022
and 31 December 2021 are as follows:
30 June 31 December
2022 2021
Leases to be paid in one year 114,814 83,944
Leases to be paid between one to
two years 127,601 83,948
Leases to be paid between two to
three years 100,015 72,493
Leases to be paid between three years
and more 118,098 101,222
--------------------------------------- -------- ------------
460,528 341,607
--------------------------------------- -------- ------------
NOTE 17 - FINANCIAL LIABILITIES (Continued)
The reconciliation of adjusted net debt as of 30 June 2022 and
31 December 2021 is as follows:
30 June 2022 31 December
2021
-------------------------------------- ------------- ------------
Short term bank borrowings 625,325 348,969
Short-term portions of long-term
borrowings 538 109,575
Short-term portions of long-term
leases 114,814 83,944
Long-term bank borrowings 273,078 221,372
Long-term leases 345,714 257,663
-------------------------------------- ------------- ------------
Total borrowings 1,359,469 1,021,523
-------------------------------------- ------------- ------------
Cash and cash equivalents (-) (268,576) (223,912)
-------------------------------------- ------------- ------------
Net debt 1,090,893 797,611
-------------------------------------- ------------- ------------
Non-recurring items
per Group management
Long-term deposit for loan guarantee (5,589) (35,527)
-------------------------------------- ------------- ------------
Adjusted net debt (*) 1,085,304 762,084
-------------------------------------- ------------- ------------
(*) Net debt, adjusted net debt and non-recurring and non-trade
items are not defined by IFRS. Adjusted net debt includes cash
deposits used as a loan guarantee and cash paid, but not collected,
during the non-working day at the year end. Management uses these
numbers to focus on net debt to consider deposits not otherwise
considered cash and cash equivalents under IFRS.
NOTE 18 - COMMITMENTS, CONTINGENT ASSETS AND LIABILITIES
a) Guarantees given to third parties as of 30 June 2022 and December 2021 are as follows;
30 June 2022 31 December 2021
Guarantee letters given 44,388 67,543
------------------------- ------------- -----------------
44,388 67,543
------------------------- ------------- -----------------
b) Guarantees received for trade receivables are as follows:
30 June 2022 31 December 2021
Guarantee notes received 94,112 107,263
Guarantee letters received 64,788 104,677
---------------------------- ------------- -----------------
158,900 211,940
---------------------------- ------------- -----------------
c) Tax contingencies
The Russian transfer pricing legislation is generally aligned
with the international transfer pricing principles developed by the
Organisation for Economic Co -- operation and Development ("OECD")
but has specific characteristics. This legislation provides the
possibility for tax authorities to make transfer pricing
adjustments and impose additional tax liabilities in respect of
controlled transactions (transactions with related parties and some
types of transactions with unrelated parties), provided that the
transaction price is not arm's length.
Tax liabilities arising from transactions between companies
within the Group are determined using actual transaction prices. It
is possible, with the evolution of the interpretation of the
transfer pricing rules, that such transfer prices could be
challenged. The impact of any such challenge cannot be reliably
estimated; however, it may be significant to the financial position
and/or the overall operations of the Group.
The Group includes companies incorporated outside of Russia. The
tax liabilities of the Group are determined on the assumption that
these companies are not subject to Russian profits tax, because
they do not have a permanent establishment in Russia. This
interpretation of relevant legislation may be challenged but the
impact of any such challenge cannot be reliably estimated
currently; however, it may be significant to the financial position
and/or the overall operations of the Group.
As Russian tax legislation does not provide definitive guidance
in certain areas, the Group adopts, from time to time,
interpretations of such uncertain areas that reduce the overall tax
rate of the Group. While management currently estimates that the
tax positions and interpretations that it has taken can probably be
sustained, there is a possible risk that an outflow of resources
will be required should such tax positions and interpretations be
challenged by the tax authorities. The impact of any such challenge
cannot be reliably estimated; however, it may be significant to the
financial position and/or the overall operations of the Group.
NOTE 18 - COMMITMENTS, CONTINGENT ASSETS AND LIABILITIES
(Continued)
Management will vigorously defend the Group's positions and
interpretations that were applied in determining taxes recognised
in these consolidated financial statements if these are challenged
by the authorities.
NOTE 19 - EQUITY
The shareholders and the shareholding structure of the Group at
30 June 2022 and 31 December 2021 are as follows:
30 June 2022 31 December 2021
---------------------------------- ----------------------------
Share (%) Amount Share (%) Amount
Jubilant FoodWorks Netherlands B.V. (*) 43.7 15,869 7.5 2,722
Fides Food Systems Coöperatief U.A.(*) - - 32.8 11,928
Public shares 50.6 18,412 54.6 19,849
Vision International N.V.(**) 5.6 2,027 4.9 1,781
Other 0.1 45 0.2 73
36,353 36,353
(*) Fides Food Systems Coöperatief UA merged with Jubilant
FoodWorks Netherlands B.V. (acquiring entity)
(**) Vision Lovermark Coöperatief UA merged with Vision
International N.V. (acquiring entity)
As of 30 June 2022, the Group's 145,372,414 shares are issued
and fully paid for.
The nominal value of each share is EUR0.12 (2021: EUR0.12).
There is no preference stock.
DP Eurasia's authorised share capital is EUR 60,000,000.
As of 30 June 2022, the Group's 145,372,414 (30 June 2021:
145,372,414) shares are issued and fully paid for.
NOTE 19 - EQUITY (Continued)
Share premium
Share premium represents differences resulting from the
incorporation of Fides Food by Fides Food Systems Coöperatief U.A.
at a price exceeding the face value of those shares and differences
between the face value and the fair value of shares issued at the
IPO.
Ultimate controlling party
The ultimate controlling party of the Company is Jubilant
Foodworks Limited. There is no individual ultimately controlling
the Group.
NOTE 20 - INCOME TAX
The Group is subject to taxation in accordance with the tax
regulations and the legislation effective in the countries in which
the Group companies operate. Therefore, provision for taxes, as
reflected in the condensed consolidated financial information, has
been calculated on a separate-entity basis. On 30 June 2022, the
tax is 23% for Turkey, %20 for Russia, and %25 for the
Netherlands.
Corporate tax liability for the year consists of the
following:
30 June 2022 31 December 2021
Corporate tax calculated 33,739 63,231
Prepaid taxes (-) (12,404) (45,028)
-------------------------- ------------- -----------------
Tax liability 21,335 18,203
-------------------------- ------------- -----------------
Tax income and expenses included in the statement of
comprehensive income are as follows:
30 June 2022 30 June 2021
Current period corporate tax expense (33,739) (26,660)
Deferred tax (expense)/income (18,582) (9,943)
-------------------------------------- ------------- -------------
Tax expense (52,321) (36,603)
-------------------------------------- ------------- -------------
NOTE 20 - INCOME TAX (Continued)
The breakdown of cumulative temporary differences and the
resulting deferred income tax assets/liabilities at 30 June 2022
and 31 December 2021 using statutory tax rates are as follows:
30 June 2022 31 December 2021
---------------------------- ----------------------------
Deferred tax Deferred tax
Temporary assets/ Temporary assets/
differences (liabilities) differences (liabilities)
------------ -------------- ------------ --------------
Carry forward tax losses (*) 83,880 16,776 72,427 14,485
Contract liabilities from franchising contracts 97,326 21,792 152,691 30,538
Right of use assets and lease liability 24,006 6,584 7,561 1,512
Bonus accruals
Legal provisions 4,590 1,018 8,204 1,641
Unused vacation liabilities 9,286 2,136 8,267 1,653
Provision for employee termination benefit 6,733 1,549 5,965 1,490
Stok (49,258) (11,329) (26,527) (5,305)
Other 71,178 16,371 (13,686) (2,735)
Property, equipment and intangible assets (156,866) (31,371) (114,986) (22,996)
Deferred income tax assets, net 23,526 20,283
------------------------------------------------- ------------ -------------- ------------ --------------
(*) Consists of carry forward losses of Domino's Russia.
Domino's Russia has not recognised any additional tax assets on
carry forward losses in 2021 and first half of 2022, the change is
the result of the currency translation differences between Russian
Roubles and Turkish Lira.
NOTE 21 - SUBSEQUENT EVENT
As of 30 September 2022, Jubilant Foodworks Netherlands B.V has
aggregating to 65,177,365 ordinary shares in total (which is equal
to 44,76% of the Company's outstanding issued share capital).
On 8 September 2022, the Company shall allot a total of 250,722
new ordinary shares of EUR0.12 each ("New Shares") in connection
with an exercise of options awarded to senior employees which has
now crystallised under the LTIP. Application has been made for the
New Shares to be admitted to trading on the premium listing segment
of the Official List of the FCA and to trading on the London Stock
Exchange ("Admission") and it is expected that Admission will take
place on 8 September 2022. Following Admission, the Company will
have 145,623,136 ordinary shares in issue. The Company does not
hold any ordinary shares in treasury therefore the total number of
ordinary shares in the Company with voting rights is
145,623,136.
Amsterdam, 28 September 2022
The Directors of DP Eurasia N.V. as at the date of this
announcement are as set out below:
Peter Williams*
Aslan Saranga, Chief Executive Officer
Frederieke Slot, Company Secretary
Shyam S. Bhartia*
Hari S. Bhartia*
David Adams*
Burak Ertas*
Ahmet Ashaboglu*
* Non-Executive Directors
...............
Review report
To: the board of directors of DP Eurasia N.V.
Introduction
We have reviewed the accompanying condensed consolidated interim
financial statements for the six--month period ended 30 June 2022
of DP Eurasia N.V., Amsterdam, which comprises the condensed
consolidated statement of the financial position as at 30 June
2022, the condensed consolidated statement of comprehensive income,
the condensed consolidated statement of changes in equity, the
condensed consolidated statement of cash flows for the period then
ended and the notes to the condensed consolidated interim financial
statements. The board of directors is responsible for the
preparation and presentation of this (condensed) interim financial
statements in accordance with IAS 34, 'Interim Financial Reporting'
as adopted by the European Union. Our responsibility is to express
a conclusion on this interim financial information based on our
review.
Scope
We conducted our review in accordance with Dutch law including
standard 2410, Review of Interim Financial Information Performed by
the Independent Auditor of the entity. A review of interim
financial information consists of making inquiries, primarily of
persons responsible for financial and accounting matters, and
applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance
with auditing standards and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the accompanying condensed consolidated
interim financial information for the six-month period ended 30
June 2022 is not prepared, in all material respects, in accordance
with IAS 34, 'Interim Financial Reporting' as adopted by the
European Union.
Amsterdam, 28 September 2022
PricewaterhouseCoopers Accountants N.V.
B.A.A. Verhoeven RA
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
IR LLMMTMTBTTMT
(END) Dow Jones Newswires
September 30, 2022 02:00 ET (06:00 GMT)
Dp Eurasia N.v (LSE:DPEU)
Historical Stock Chart
From Jun 2024 to Jul 2024
Dp Eurasia N.v (LSE:DPEU)
Historical Stock Chart
From Jul 2023 to Jul 2024
