Mediterranean Investments Holding plc – Group Half-Yearly Report

The Board of Directors of Mediterranean Investments Holding plc announced that they have approved the group's half-yearly report for the six months ended June 30, 2014. The group registered a profit befor tax of EUR 8.03m, as opposed to the EUR 8.87m recorded during the comparable period of last year. Revenue for the period under review stood at EUR 16.35m – a 4% increase over 2013. EPS decreased to EUR 0.153.  

The conflict in Libya in the past month has brought about an evacuation of most of the tenants, although the rental agreements remain effective. Contractually, clients can only claim a situation of force majeure three months following the start of an agreed force majeure date. Clearly, if the current situation persists for much longer, it is likely that this will negatively impact the financial performance of Palm City Residences. The Group has taken immediate and appropriate measures to protect its staff and its property and to minimise the impact on the operational performance and results. Accordingly, management has downscaled the number of staff and has contained the extent of facilities that remain open given the prevailing situation on the ground. 

Given the downturn in business, the value of the Group’s property in Libya as at the reporting date would normally need to be tested for impairment. Such an exercise is based on projected cash flows discounted to present day value. However, in view of the unpredictable situation in Libya, we feel it is inappropriate to try to model outcomes where the future is so unclear and it is difficult to make fact-based assumptions. We have thus chosen to defer the asset valuation exercise to a later period when there is some clarity about the geopolitical situation.

To view the ooficial company announcement, click here.