30 September
2016
Clear Leisure plc
("Clear Leisure", “the Group” or "the Company")
INTERIM RESULTS
For the 6 Months Ended 30 June 2016
Clear Leisure plc (AIM: CLP) announces its unaudited Interim
Results for the 6 months ended 30 June
2016.
HIGHLIGHTS
-
Operating loss for the period reduced to EUR 275,000 (H1 2015: EUR
459,000)
-
Loss before tax reduced to EUR
605,000 (H1 2015: EUR
13,238,000)
For further information please
contact, or visit www.clearleisure.com:
Clear Leisure
plc
+39 335 296573
Francesco Gardin, CEO and Executive
Chairman
ZAI Corporate Finance (Nominated Adviser)
Tim Cofman/Jamie Spotswood
+44 (0)20 7060 2220
Peterhouse Corporate Finance (Joint Broker)
+44 (0) 20 7469 0935
Lucy Williams / Heena Karani
Cadogan Leander (Financial PR)
+44 (0) 7795 168 157
Christian Taylor-Wilkinson
About Clear Leisure Plc
Clear Leisure plc (AIM: CLP) is an AIM listed investment company
with a portfolio of companies primarily encompassing the leisure
and real estate sectors mainly in Italy. The Company may be either a passive or
active investor and Clear Leisure’s investment rationale ranges
from acquiring minority positions with strategic influence through
to larger controlling positions. For further information, please
visit, www.clearleisure.com
CHAIRMAN’S
STATEMENT
During the first six months of the year, the focus of management
has remained the monetisation of all of the Company’s existing
assets, through selected realisations, court-led recoveries of
misappropriated assets and substantial debt-recovery processes.
As part of this policy, Clear Leisure disposed in May of its
9.9% holding in Ascend Capital Limited for £50,000 and engaged
several law firms for legal actions to recover shareholder funds in
the UK and Italy from its other
investments; each law firm was selected for its specialist
experience in the area specific to the individual claim.
The Board is committed to achieving significant cash return to
shareholders; the emphasis is on cash collection, not paper profits
/ valuation;
Moreover, the Board believes the Company will represent a
particularly attractive shell vehicle, with approximately
EUR 60 million of capital and trading
loses.
Clear Leisure’s largest shareholder, Eufingest, has demonstrated
continuous support to the Company, by making available convertible
loans, during the first six months of 2016 for circa £340,000,
bringing the total amount borrowed to £775,000.
In the first six months of 2016 the valuation of Company assets
remains unchanged.
Meanwhile, the Company has achieved a reduction in the operating
losses to EUR 275,000, compared to
EUR 459,000 for the same period in
2015.
The Company continues to pursue legal claims, amounting to some
EUR 55 million (£45.5 million); the
value of these claims is not included on the Company’s balance
sheet.
Portfolio Companies
An update on the Group’s portfolio companies on 30 June 2016 is as follows (percentage of equity
held):
Mediapolis srl (84.04%): owns the land in north-west
Italy designated for the purpose
of a theme park, with additional guest facilities, shops and
offices, as well as 10 holiday villas in the Porto Cervo area, the
most exclusive holiday location in Sardinia. The Company continues to pursue its
EUR 39.65 million claim against the
regional government of Piedmont
for failing to honour a commitment to approve the construction of
the park.
As the result of a detailed professional valuation, completed in
June 2016 the gross carrying value of
the development land in the Clear Leisure accounts has been
adjusted to EUR 13 million and that
of the villas, to EUR 5.1
million.
SIPIEM SpA (50.17%): has a minority
shareholder in T.L.T. SpA which owns a number of real estate assets
including the operating Ondaland Waterpark located in north-west
Italy.
After a protracted dispute regarding the rights attaching to
SIPIEM, in May 2015 Clear Leisure
finally won the rights to have its 50.17% ownership in SIPIEM
“Certified,” thereby entitling the Company to have representation
at shareholder meetings and appoint the legal representative of the
Company. In July 2016 the Company
voted at a SIPIEM shareholders meeting, presenting a resolution to
recover damages from former management and internal audit committee
members. The Company is confident that its imminent legal
procedures will result in a successful outcome for the Company. The
Board remains confident that its holding in SIPIEM will become a
significant realisable asset.
GeoSim Systems Ltd (www.geosim.co.il) (4.71%): an
Israeli company seeking to establish itself as the world leader in
building complete and photorealistic 3D “virtual” cities and in
delivering them through the Internet for use in local searches,
real estate and city planning, homeland security, tourism and
entertainment. Autonomous car projects and other new applications
will inevitably require very detailed 3D models of cities and in
this regard, the release of GeoSim’s Vancouver 3D model represents an important
milestone for the company. GeoSim technology remains one of the
best options worldwide.
ORH SpA (99.3%): owns a chain of hotels
in Italy and East Africa under the Ora Hotels brand. It was
put into administration in February
2014, allegedly due to gross financial misconduct by the
certain individuals associated with the company, prior to the sale
to Clear Leisure. The Company continues to pursue a claim against
these entities, with the objective to recover all the funds
historically invested, of nearly EUR 6
million in cash and shares.
Financial Review
The Company reported a loss before tax of EUR 620,000 in the six months to 30 June 2016 (June
2015: loss before tax EUR
15,573,000); operating losses for the period were
EUR 275,000 (June 2015: operating loss EUR 459,000).
The undiluted Net Asset Value (NAV) of the Company as of
30 June 2016 was EUR 0.72 million (£0.62 million), compared to
EUR 1.34 million at 31 December 2016. The decrease in value is due to
the increase in expenses relating to the ongoing litigation and
finance costs. However, the Company has now begun the process of
reducing its debt position at a discount to offset these costs and
is confident that the NAV at the end of the year will be much
stronger. For example, on 23 September
2016, the Company purchased subsidiary debt at a
significantly reduced cost, thereby reducing its debt position by
EUR 800,000, which will be reflected
on the end of year NAV position.
Operational review
A favourable ruling in February
2016 by the Turin Court,
Companies Section, meant that Clear Leisure was confirmed the
legitimate controlling owner of 50.17% of SIPIEM. This court ruling
represents a fundamental step for the Company towards obtaining
title to the T.L.T. S.p.A. shares, part owner of the Ondaland
Waterpark.
The Company entered into a £250,000 secured loan in March 2015, bearing interest of £80,000 with a
1 September 2015 repayment date. The
new Board extended the repayment date and entered into negotiations
with regard to the calculation of interest. On 2 March 2016, the lender and the Company entered
into a settlement agreement as a result of which the loan principal
has been repaid, while the £80,000 interest component of the
original loan, plus 4.5% interest, will be settled on, or before
31 December 2016.
A £200,000 convertible loan agreed with Eufingest, bearing 2.5%
interest and a conversion right at 0.75p per share, was drawn down
on 15 March 2016 and was originally
to be repaid on 15 September
2016.
The previous Board had negotiated settlement in principle with
Digital Magics S.p.A. to close all outstanding disputes arising
from past transactions involving a number of deals between Clear
Leisure and Digital Magics S.p.A. This agreement involved the issue
of a further EUR 400,000, 7% debt
bond and a cash payment for EUR
17,500. The new Board renegotiated in March 2016 the original settlement and has agreed
to issue two units, totaling EUR
300,000, of the existing Clear Leisure Bond, bearing a 7%
interest, which expires on 15 December
2017. The EUR 17,500 cash
payment obligation is unchanged.
In May 2016, Eufingest provided a
facility of £100,000 at an interest rate of 2.5 per cent per annum
and a conversion right at 0.75p per share. The Facility is
repayable on 30 September 2016. A further EUR 50,000 was made available at the end of May,
under the same terms.
Finally, at the end of June the Company’s equity position of
9.9% held in Ascend Capital Limited, a London based broker, was sold back to Ascend
Capital for £50,000 (circa EUR
60,000).
Post 30 June
2016 Events
At the end of July, Clear Leisure allotted 1,428,571 ordinary
shares to Francesco Gardin, in
settlement of £12,500 of his salary from August 2015 to December
2015. This was in accordance with his contract and the
effective issue price of the shares was 0.875p.
On 4 August the Company successfully completed a £150,000 (gross
of expenses) private placement of 30,000,000 ordinary shares of
0.25 pence at a price of 0.50 pence per share. The funds raised have
been used for general working capital purposes and to help fund the
current litigation to recover past investments.
On the same day Eufingest converted £164,872.10 of its loans, at
0.75p per share, corresponding to 21,982,947 new ordinary shares of
0.25p each. The conversion has increased Eufingest’s holding in the
Company from 26.85% to 29.90%.
The conversion was made from the £200,000 Convertible Loan
Notes, which were due on 15 September
2016. As a result, Clear Leisure’s exposure to Eufingest
convertible loans was reduced from approximately £775,000 to circa
£610,000.
On 14 September, Clear Leisure raised £200,000 (before expenses)
through a placing of 22,222,222 new ordinary shares of 0.25p each,
at a price of 0.9p per share. The placing shares represent 7.78 per
cent. of the enlarged issued Ordinary Shares of the Company.
The funds raised were used to accelerate the buyback of certain
subsidiaries bank debts, resulting in a substantial improvement of
the Groups’ consolidated balance sheet.
In connection with the placing, the Company issued one warrant
for every one Placing Share with an exercise price of 1.5p. The
22,222,222 warrants may be exercised at any time within 6 months of
admission of the placing shares, i.e. 20
March 2017. The warrants will not be admitted to trading on
any market, but will be freely transferable.
The Company announced on 23 September that it had entered into a
binding agreement with an Italian bank to buy back EUR 1.3 million of debt of one is its
subsidiaries at a 76% discount. A consideration schedule has been
agreed with the bank. This represents a pro-rata improvement of
approximately EUR 800,000 (£690,000)
in the Company’s consolidated balance sheet.
On 29 September, the Company and Eufingest agreed to reschedule
the payment of all Convertible Loans Notes to a later date, to be
negotiated by the parties, before 31 March
2017.
Francesco Gardin
Clear Leisure PLC
CEO and Chairman
GROUP STATEMENT OF COMPREHENSIVE INCOME
FOR THE PERIOD ENDED 30 JUNE 2016
|
Note |
Six
months to 30 June 2016
Unaudited |
Six
months to 30 June 2015
Unaudited |
Year
ended 31 December 2015
Audited |
Continuing
operations |
|
€’000 |
€’000 |
€’000 |
Revenue |
|
- |
- |
- |
Cost of sales |
|
- |
- |
- |
|
|
- |
- |
- |
Administration
expenses |
|
(275) |
(459) |
(654) |
Operating
loss |
|
(275) |
(459) |
(654) |
Other gains and
losses |
|
- |
(15,000) |
(18,569) |
Finance income |
|
- |
- |
- |
Finance charges |
|
(345) |
(114) |
(1,023) |
Loss before
tax |
|
(620) |
(15,573) |
(20,246) |
Taxation |
|
- |
- |
- |
Loss for the period
from continuing operations |
|
(620) |
(15,573) |
(20,246) |
Loss from discontinued
operations |
|
- |
- |
- |
Loss for the
Period |
|
(620) |
(15,573) |
(20,246) |
Other comprehensive
income |
|
|
|
|
Gain on acquisition of
non-controlling interest |
|
- |
- |
- |
Exchange translation
differences |
|
- |
- |
- |
Total other
comprehensive income |
|
- |
- |
- |
|
|
|
|
|
TOTAL COMPREHENSIVE
(LOSS)/INCOME FOR THE PERIOD |
|
(620) |
(15,573) |
(20,246) |
(Loss)/profit
attributable to: |
|
|
|
|
Owners of the
parent |
|
(605) |
(13,238) |
(17,016) |
Non-controlling
interests |
|
(15) |
(2,335) |
(3,230) |
Total comprehensive
income attributable to |
|
|
|
|
Owners of the
parent: |
|
(605) |
(13,238) |
(17,016) |
Non-controlling
interests |
|
(15) |
(2,335) |
(3,230) |
Earnings per
share: |
3 |
|
|
|
Basic and fully
diluted loss from continuing operations |
|
(€0.003) |
(€0.065) |
(€0.08) |
Basic and diluted loss
per share from discontinued operations |
|
- |
- |
- |
Basic and diluted loss
per share |
|
(€0.003) |
(€0.065) |
(€0.08) |
|
|
|
|
|
STATEMENTS OF FINANCIAL
POSITION
AT 30 JUNE
2016
|
Notes |
Six months to 30
June 2016
€’000 |
Six months to 30 June
2015
€’000 |
Year ended
31 December 2015
€’000 |
Non-current
assets |
|
|
|
|
Goodwill |
|
- |
9 |
- |
Other intangible
assets |
|
50 |
151 |
50 |
Property, plant and
equipment |
|
18,114 |
23,697 |
18,114 |
Available for sale
investments |
4 |
- |
6,560 |
60 |
Other receivables |
|
- |
- |
- |
Total non-current assets |
|
18,164 |
30,417 |
18,224 |
|
|
|
|
|
Current assets |
|
|
|
|
Available for sale investments |
4 |
614 |
450 |
614 |
Trade and other receivables |
|
6,847 |
150 |
6,847 |
Cash and cash equivalents |
5 |
1,393 |
1,370 |
1,842 |
Total current assets |
|
8,854 |
1,970 |
9,303 |
|
|
|
|
|
Current liabilities |
|
|
|
|
Trade and other payables |
|
(4,588) |
(4,070) |
(4,948) |
Borrowings |
|
(21,303) |
(20,952) |
(20,832) |
Total current
liabilities |
|
(25,891) |
(25,022) |
(25,780) |
|
|
|
|
|
Net current liabilities |
|
(17,037) |
(23,052) |
(16,477) |
|
|
|
|
|
Total assets less current
liabilities |
|
1,127 |
7,365 |
1,747 |
|
|
|
|
|
Non-current liabilities |
|
|
|
|
Borrowings |
|
- |
- |
- |
Deferred liabilities and
provisions |
|
(407) |
(1,355) |
(407) |
Total non-current
liabilities |
|
(407) |
(1,355) |
(407) |
|
|
|
|
|
Net assets |
|
720 |
6,010 |
1,340 |
|
|
|
|
|
Equity |
|
|
|
|
Share capital |
|
6,112 |
6,113 |
6,112 |
Share premium account |
|
42,954 |
42,972 |
42,954 |
Other reserves |
|
11,412 |
11,390 |
11,412 |
Retained losses |
|
(59,998) |
(55,615) |
(59,393) |
Equity attributable to owners of the
Company |
|
480 |
4,860 |
1,085 |
Non-controlling interests |
|
240 |
1,150 |
255 |
Total equity |
|
720 |
6,010 |
1,340 |
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 31 DECEMBER 2015
Group |
Share
capital
€’000 |
Share
premium
account
€’000 |
Other
reserves
€’000 |
Retained losses
€’000 |
Total
€’000 |
Non-controlling interests
€’000 |
Total
equity
€’000 |
|
|
|
|
|
|
|
|
At 1 January 2015 |
6,074 |
42,856 |
11,390 |
(42,377) |
17,943 |
3,485 |
21,428 |
Loss for the year |
- |
- |
- |
(17,016) |
(17,016) |
(3,230) |
(20,246) |
Other comprehensive
income |
- |
- |
- |
- |
- |
- |
- |
Total comprehensive
income for the year |
- |
- |
- |
(17,016) |
(17,016) |
(3,230) |
(20,246) |
Issue of shares |
38 |
98 |
- |
- |
136 |
- |
136 |
Share option
charge |
- |
- |
22 |
- |
22 |
- |
22 |
At 31 December
2015 |
6,112 |
42,954 |
11,412 |
(59,393) |
1,085 |
255 |
1,340 |
|
|
|
|
|
|
|
|
UNAUDITED STATEMENT
OF CHANGES IN EQUITY
FOR THE SIX MONTHS
TO 30 JUNE 2016
Group |
Share
capital
€’000 |
Share
premium
account
€’000 |
Other
reserves
€’000 |
Retained losses
€’000 |
Total
€’000 |
Non-controlling interests
€’000 |
Total
equity
€’000 |
|
|
|
|
|
|
|
|
At 1 January 2016 |
6,112 |
42,954 |
11,412 |
(59,393) |
1,085 |
255 |
1,340 |
Loss for the period
and total comprehensive income |
- |
- |
- |
(605) |
(605) |
(15) |
(620) |
At 30 June
2015 |
6,112 |
42,954 |
11,412 |
(59,998) |
480 |
240 |
720 |
|
|
|
|
|
|
|
|
STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED
30 JUNE 2016
|
|
Six months to 30
June 2016
Unaudited
€’000 |
Six months to 30
June 2015
Unaudited
€’000 |
Year ended 31
December 2015
Audited
€’000 |
|
|
|
|
|
Net cash outflow from operating
activities |
|
(578) |
(510) |
(835) |
|
|
|
|
|
Cash flows from
investing activities |
|
|
|
|
Disposal of investments |
|
60 |
- |
900 |
Net cash inflow from investing activities |
|
60 |
- |
900 |
|
|
|
|
|
Cash flows from financing
activities |
|
|
|
|
Proceeds from issues of new ordinary
shares (net of expenses) |
|
- |
155 |
136 |
Proceeds from
borrowings |
|
409 |
352 |
540 |
Repayment of
debt |
|
(340) |
- |
(272) |
Net cash inflow from
financing activities |
|
69 |
507 |
404 |
|
|
|
|
|
Net (decrease)/increase in cash
for the period |
|
(449) |
(3) |
469 |
Cash and cash
equivalents at beginning of year |
|
1,842 |
1,373 |
1,373 |
|
|
|
|
|
Cash and cash equivalents at end
of period |
|
1,393 |
1,370 |
1,842 |
|
|
|
|
|
|
|
|
|
|
NOTES TO THE FINANCIAL STATEMENTS
1.General Information
Clear Leisure plc is a company incorporated and domiciled in
England and Wales. The Company’s ordinary shares are
traded on AIM of the London Stock Exchange. The address of the
registered office is 22 Great James Street, London, WC1N 3ES.
The principal activity of the Group is that of an investment
company pursuing a strategy to create a portfolio of companies.
2. Accounting policies
The principal accounting policies are summarised below. They
have all been applied consistently throughout the period covered by
these consolidated financial statements.
Basis of preparation
The interim financial information set out above does not
constitute statutory accounts within the meaning of the Companies
Act 2006. It has been prepared on a going concern basis in
accordance with the recognition and measurement criteria of
International Financial Reporting Standards (IFRS) as adopted by
the European Union. Statutory financial statements for the year
ended 31 December 2015 were approved
by the Board of Directors on 29 June
2016 and delivered to the Registrar of Companies. The report
of the auditors on those financial statements was unqualified.
The financial statements have been prepared under the historical
cost convention except for certain available for sale investments
that are stated at their fair values and land and buildings that
have been revalued to their fair value.
The interim financial information for the six months ended
30 June 2016 has not been reviewed or
audited. The interim financial report has been approved by the
Board on xx September 2016.
Going concern
The Directors, having made appropriate enquiries, consider that
adequate resources exist for the Company to continue in operational
existence for the foreseeable future and that, therefore, it is
appropriate to adopt the going concern basis in preparing the
interim financial statements for the period ended 30 June 2016.
Risks and uncertainties
The Board continuously assesses and monitors the key risks of
the business. The key risks that could affect the Company’s medium
term performance and the factors that mitigate those risks have not
substantially changed from those set out in the Company’s 2015
Annual Report and Financial Statements, a copy of which is
available on the Company’s website:
www.clearleisure.com The key financial risks are liquidity and
credit risk.
Critical accounting estimates
The preparation of interim financial statements requires
management to make estimates and assumptions that affect the
reported amounts of assets and liabilities at the end of the
reporting period. Significant items subject to such estimates are
set out in note 2 of the Company’s 2015 Annual Report and Financial
Statements. The nature and amounts of such estimates have not
changed significantly during the interim period.
3. Loss per share
The basic earnings per share is calculated by dividing the
earnings attributable to ordinary shareholders by the weighted
average number of ordinary shares outstanding during the period.
Diluted earnings per share is computed using the same weighted
average number of shares during the period adjusted for the
dilutive effect of share warrants and convertible loans outstanding
during the period.
The profit and weighted average number of shares used in the
calculation are set out below:
|
Six
months to 30 June 2016 |
Six
months to
30 June 2015 |
Year
ended
31 Dec 15 |
|
(Unaudited) |
(Unaudited) |
(Audited) |
€’000 |
€’000 |
€’000 |
Loss attributable
to owners of the parent company: |
|
|
|
Continuing
operations |
(605) |
(13,238) |
(17,016) |
Discontinued
operations |
- |
- |
- |
Total operations |
(605) |
(13,238) |
(17,016) |
Weighted average
number of ordinary shares (000’s) |
210,409 |
203,117 |
208,378 |
Basic and fully
diluted earnings per share: |
|
|
|
Continuing
operations |
(€0.003) |
(€0.065) |
(€0.082) |
Continuing and
discontinued operations |
(€0.003) |
(€0.065) |
(€0.082) |
IAS 33 requires presentation of diluted earnings per share when
a company could be called upon to issue shares that would decrease
earnings per share or increase net loss per share. For a loss
making company with outstanding share options and warrants, net
loss per share would only be increased by the exercise of
out-of-the money options and warrants, so no adjustment has been
made to diluted earnings per share for out-of-the money options and
warrants in the comparatives. There are no other diluting share
issues
4. Available for sale investments
Group |
Six
months to
30 June 2016
€’000 |
Six
months to
30 June 2015
€’000 |
Year
Ended 31 December 2015
€’000 |
|
|
|
|
Fair value |
|
|
|
At beginning of
period |
60 |
6,560 |
6,560 |
Transfer to trade and
other receivables |
- |
- |
(6,500) |
Disposals |
(60) |
- |
- |
Carrying value |
- |
6,560 |
60 |
Non-current
assets |
- |
6,560 |
60 |
Current
assets |
614 |
450 |
614 |
|
614 |
7,010 |
674 |
|
|
|
|
5. Cash and cash equivalents
The amounts shown as cash and cash equivalents for the current
and comparative periods include €1,368,000 in a blocked account
which can only be used when construction commences at the
Mediapolis development site.
6. Investment Policy
The Company intends on identifying and investing in investment
opportunities which it believes show excellent growth potential on
a stand-alone basis and which would add value to the Company's
portfolio of investments through the expertise of the Board or
through the provision of ongoing funding.
It is the intention of the Company that the majority of
investments will be made in unlisted companies; however pre-IPO and
listed companies may, from time to time, be considered on a
selective basis.
The Company believes that the broad collective experience of the
Board together with its extensive network of contacts will assist
them in the identification, evaluation and funding of investment
targets. When necessary other external professionals will be
engaged to assist in the due diligence of prospective targets. The
Board will also consider, as it sees fit, appointing additional
directors and/or key employees with relevant experience as part of
any specific investment.
The Company may offer Shares as well as cash by way of
consideration for prospective investments, thereby helping to
preserve the Company's cash for working capital. The Company may,
in appropriate circumstances, issue debt securities or borrow money
to complete an investment.
7. Copies of Interim Accounts
Copies of the interim results are available at the Group´s web
site at www.clearleisure.com. Copies may also be obtained from the
Group´s registered office: Clear Leisure PLC, 22 Great James Street
London WC1N 3ES.