Alina Holdings PLC (ALNA) Alina Holdings PLC: Interim Results for the period ended 30 June 2022 02-Aug-2022 / 07:00 GMT/BST Dissemination of a Regulatory Announcement that contains inside information in accordance with the Market Abuse Regulation (MAR), transmitted by EQS Group. The issuer is solely responsible for the content of this announcement.

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Highlights for the 6 months ended 30 June 2022

GROUP RESULTS 1H 2022 versus 1H 2021

 
 Group Net Profit / (Loss) for the period                        (GBP0.33m) vs. (GBP0.08m) 
 
 Group Earnings / (Loss) Per Share (both basic and diluted)*1    (1.44p) vs. (0.36p) 
 
 Reported Book value per share*2                                 GBP0.26 vs. GBP0.28 
 
 Net Cash                                                        GBP1.1m vs. GBP2.9m 
 
 Investment Holdings                                             GBP2.7m vs. GBP1.1m 
 
*1 based on weighted average number of shares in issue of 22,697,397 (1H21: 22,697,397) 
*2 based on actual number of shares in issue as at 30 June 2022 of 22,697,397 

Chairman's Statement

Trading update

The Company's hedging strategy served its purpose and partially protected ALNA shareholders during the first half of 2022, thereby reducing the impact of mark-to-market declines in the Companies quoted holdings. Both of the Company's two largest holdings Dolphin Capital Investors (DCI LN) and HEIQ (HEIQ LN) traded lower, like many small cap. company shares, on lack of interest, rather than on concerted selling.

Macro Background

Global Technology stock took the full brunt of the 2022 correction on the chin, which has seen Cathie Woods' ARK Innovation ETF give back virtually all its 383% gain and which is now down 74% since peaking in December 2021. Many of ARK's investments had no earnings or were trading on triple digit p/e multiples. Many of the major stock market indices have performed badly but not as badly as the investment vehicles with substantial exposure to "Story Stocks". At the time of writing, the Dow Jones Index is down Year to Date ("YTD") 15.29%, the S&P 500 is down 51% and the NASDAQ Index is down 29.19%. whilst European Indices are down YTD between 7% and 22%.

Macro Outlook

Your Board is not convinced by the Markets recent rally, but take the view that there is another leg down in US and EU (incl. UK) Stock prices, which will be driven by research analysts reducing their overly optimistic earnings estimates for 2022, 2023 and 2024.

Analysts surveyed by Bloomberg are still estimating that S&P 500 earnings will increase from current level of 199.67 to 235.78, an increase of 18.08%, in 2022, by +5.22% in 2023, and by +9.02% in 2024. Given the fact that inflation is currently running at record levels, and our view that Central Bankers may well tighten too much, just as Western economic activity slows, we believe that analysts will rapidly start to reduce their 2022 Q3 and Q4, as well as 2023 and 2024, earnings estimates when they get back from their summer holidays.

Operations

Real Estate

We continue to actively manage the Company's realestate assets and a number of properties will be put up for sale in the second half of the year. In respect of the Hastings and Bristol properties, the Board has actioned a refurbishment and capital expenditure plan, which we believe will enhance both the yield and potential sale value of both properties.

Holdings 1. Dolphin Capital Investors Ltd (DCI LN)

https://www.dolphinci.com/?doing_wp_cron=1658743513.1735150814056396484375

ALNA currently owns 3.2% of DCI, which is focused on the development of luxury leisure properties in the Eastern Mediteranean Greece, Cyprus and Croatia).

The company has had a torrid life and is currently trying to wind down its realesate portfolio and return capital to shareholders. DCI's most recently released (July 2022) fact sheet indicates that the current NAV of the company stands at 12p/share versus a market price of 3.15p (at the time of writing). Clearly the new Board are struggling to convince the market that the liquidation of the company's assets will return stated NAV!. Your Board has discounted the Company's stated NAV by 33%, and estimate NAV to be ±8p, which if achieved would result in excess of a 100% ROI. 2. HEIQ plc (HEIQ LN)

https://www.heiq.com/investors/

ALNA currently owns 0.68% of HeiQ is an IP creator and established global brand in materials and textile innovation, adding hygiene, comfort, protection and sustainability to the products we use every day.

HeiQ has a core chemical business, which in 2021 generated Revenues of USD57.9m and EBITDA of USD6.5m.

HeiQ has a pipeline of innovative and potentially disruptive products such as:

HEIQ AeoniQ, an innovative high-performance cellulose filament yarn that has for the first time in textiles the potential to replace polyester and nylon. Made from waste, recycled or reactor grown cellulosic biopolymers that bind carbon (CO2) from the atmosphere.For every ton of polyester substituted by HeiQ AeoniQ, up to +5 tons of CO2 can be reduced.

As of February 2022, only four months after we announced the project, AeoniQ had on-boarded two global brands, The LYCRA Company and HUGO BOSS, with total financial commitments (subject to milestone achievements) exceeding USUSD10m.

HeiQ GrapheneX, a highly porous graphene membrane electronics, batteries and beyond.

Graphene is an atomically-thin, two-dimensional layer of carbon with unique properties, including exceptionally high strength, high conductivity, non-permeability, flexibility and chemical inertness. Permeable membrane materials are a critical feature in diverse filtration and separation applications that are essential to society and the environment. Membrane performance is determined by material strength, minimal permeation resistance to the substances being filtered and separated, and other material properties such as conductivity and wettability. HeiQ aims to create an ultra-thin, extra-strong, fully-permeable and conductive porous graphene membrane material for use in applications such as batteries and filtration that enable positive global impact in resource efficiency, health and sustainability.

Conclusion

We remain cautious on the macro-economic outlook, and do not believe it is safe to get back into the water yet. Having said that, we continue to research and find potentially interesting businesses at increasingly appealing vauations as investor interest dwindles with the increasing expectation of recession.

Duncan Soukup

Chairman

Thalassa Holdings Ltd

1 August 2022

Responsibility Statement

We confirm that to the best of our knowledge: a. the condensed set of financial statements has been prepared in accordance with IAS 34 'Interim FinancialReporting' and gives a true and fair view of the assets, liabilities, financial position and profit or loss of theCompany and the undertakings included in the consolidation as a whole as required by DTR 4.2.4 R; b. the interim management report includes a fair review of the information required by DTR 4.2.7R(indication of important events during the first six months and description of principal risks and uncertaintiesfor the remaining six months of the year); and c. the interim management report includes a fair review of the information required by DTR 4.2.8R(disclosure of related parties' transactions and changes therein).

Cautionary statement

This Interim Management Report (IMR) has been prepared solely to provide additional information to shareholders to assess the Company's strategies and the potential for those strategies to succeed. The IMR should not be relied on by any other party or for any other purpose.

Duncan Soukup

Chairman

Thalassa Holdings Ltd

1 August 2022

Interim Condensed Consolidated Statement of Income

For the six months ended 30 June 2022

                                                                                 Six months Six months Year 
                                                                                 ended      ended      ended 
                                                                                 30 Jun 22  30 Jun 21  31 Dec 21 
                                                                                 Unaudited  Unaudited  Audited 
                                                                          Note   GBP'000      GBP'000      GBP'000 
 
Gross rental income                                                              196        218        437 
Property operating expenses                                                      (158)      (72)       (136) 
Net rental income                                                                38         146        301 
Profit/(loss) from change in fair value of investment holdings                   (441)      125        - 
Administrative expenses including non-recurring items                            (297)      (245)      (540) 
Operating loss before net financing costs                                        (700)      26         (239) 
Depreciation                                                                     (2)        (2)        (3) 
Financing income*                                                                405        54         23 
Financing expenses*                                                              (30)       (160)      (75) 
Loss before tax                                                                  (327)      (82)       (294) 
Taxation                                                                         -          -          - 
Profit/(loss) for the year from continuing operations                            (327)      (82)       (294) 
 
Attributable to: 
 
Equity shareholders of the parent                                                (327)      (82)       (294) 
                                                                                 (327)      (82)       (294) 
 
Earnings per share - GBP- pence (using weighted average number of shares) 
Basic and Diluted                                                         3      (1.44)     (0.36)     (1.30) 

The notes on pages 13 to 16 form an integral part of this consolidated interim financial information. Interim Condensed Consolidated Statement of Comprehensive Income

For the six months ended 30 June 2022

                                      Six months Six months Year 
                                      ended      ended      ended 
 
                                      30 Jun 22  30 Jun 21  31 Dec 21 
                                      Unaudited  Unaudited  Audited 
                                      GBP'000      GBP'000      GBP'000 
 
Profit/(loss) for the financial year  (327)      (82)       (294) 
 
Total comprehensive income            (327)      (82)       (294) 
 
Attributable to: 
Equity shareholders of the parent     (327)      (82)       (294) 
Total Comprehensive income            (327)      (82)       (294) 

The notes on pages 13 to 16 form an integral part of this consolidated interim financial information.

Interim Condensed Consolidated Statement of Financial Position

As at 30 June 2022

                                          As at     As at     As at 
                                          30 Jun 22 30 Jun 21 31 Dec 21 
 
                                     Note Unaudited Unaudited Audited 
Assets                                    GBP'000     GBP'000     GBP'000 
Non-current  assets 
Investment properties                4    2,782     2,786     2,784 
Total non-current assets                  2,782     2,786     2,784 
 
Current assets 
Trade and other receivables               495       466       255 
Investment holdings                  5    2,680     1,082     1,819 
Investment properties held for sale       -         330       330 
Cash and cash equivalents                 1,129     2,920     1,767 
Total current assets                      4,304     4,798     4,171 
Total assets                              7,086     7,584     6,955 
 
Liabilities 
Current liabilities 
Trade and other payables                  856       815       398 
Total current liabilities                 856       815       398 
 
Finance lease liabilities            6    324       324       324 
Total non-current liabilities             324       324       324 
 
Total liabilities                         1,180     1,139     722 
 
Net assets                                5,906     6,445     6,233 
 
Shareholders' Equity 
Share capital                        10   319       319       319 
Capital redemption reserve                598       598       598 
Retained earnings                         4,989     5,528     5,316 
Total shareholders' equity                5,906     6,445     6,233 
Total equity                              5,906     6,445     6,233 

The notes on pages 13 to 16 form an integral part of this consolidated interim financial information.

These financial statements were approved by the board on 1 August 2022.

Signed on behalf of the board by:

Duncan Soukup

Interim Condensed Consolidated Statement of Cash Flows

For the six months ended 30 June 2022

                                                                As at     As at     As at 
                                                                30 Jun 22 30 Jun 21 31 Dec 21 
                                                                Unaudited Unaudited Audited 
                                                                GBP'000     GBP'000     GBP'000 
 
 
Cash flows from operating activities 
Profit/(Loss) for the period before taxation                    (702)     (82)      (239) 
(Profit)/Loss from change in fair value of head leases          -         -         26 
Net financing loss/(income)                                     -         117       (3) 
Decrease/(Increase) in trade and other receivables              90        (83)      (27) 
(Decrease)/Increase in trade and other payables                 458       92        (168) 
Gain/(loss) on foreign exchange                                 144       (95)      (44) 
Lease liability interest                                        (11)      (11)      (22) 
Depreciation                                                    2         2         - 
Interest paid                                                   (17)      -         (6) 
Profit from change in fair value of investments held for sale   (17)      (125)     (4) 
Cash generated by operations                                    (53)      (185)     (487) 
Taxation                                                        -         -         - 
Net cash flow from operating activities                         (53)      (185)     (487) 
 
Purchase of holdings                                            (3,592)   (957)     (1,993) 
Sale of holdings                                                2,566     -         200 
Unrealised Gain or (Loss) on holdings                           441       -         - 
Net cash flow in investing activities                           (585)     (957)     (1,793) 
 
Cash flows from financing activities 
(Increase)/reduction on head lease liabilities                  -         (11)      (26) 
Net cash flow from financing activities                         -         (11)      (26) 
 
 
Net increase(decrease) in cash and cash equivalents             (638)     (1,153)   (2,306) 
Cash and cash equivalents at the start of the year              1,767     4,073     4,073 
Cash and cash equivalents at the end of the year                1,129     2,920     1,767 

The notes on pages 13 to 16 form an integral part of this consolidated interim financial information.

Interim Condensed Consolidated Statement of Changes in Equity

For the six months ended 30 June 2022

                                         Attributable to owners of the Company 
                                                   Capital 
                                         Share     redemption     Retained 
                                         Capital   reserve        Earnings     Total 
                                         GBP'000     GBP'000          GBP'000        GBP'000 
 
Balance as at 31 December 2020           319       598            5,610        6,527 
Loss for Period                           -         -             (82)         (82) 
Balance as at 30 June 2021               319       598            5,528        6,445 
Total comprehensive income for the year  -         -              (212)        (212) 
Balance as at 31 December 2021           319       598            5,316        6,233 
Loss for Period                           -         -             (327)        (327) 
Balance as at 30 June 2022               319       598            4,989        5,906 

The notes on pages 13 to 16 form an integral part of this consolidated interim financial information. Notes to the Interim Condensed Consolidated Financial Information

1. General information

Alina Holdings PLC ("Alina" or the "Company") is a company registered on the Main Market of the London Stock Exchange.

2. Significant Accounting policies

The Group prepares its accounts in accordance with applicable UK Adopted International Accounting Standards (IFRSs).

The accounting policies applied by the Company in this unaudited consolidated interim financial information are the same as those applied by the Company in its consolidated financial statements as at and for the period ended 31 December 2021 except as detailed below.

The financial information has been prepared under the historical cost convention, as modified by the accounting standard for financial instruments at fair value.

Estimates

There are no changes to the estimates since last reporting period.

Segmental reporting

IFRS 8 requires operating segments to be identified on the basis of internal reports that are regularly reported to the chief operating decision maker to allocate resources to the segments and to assess their performance. Since the strategy review in July 2013 the Group has identified one operation and one reporting segment, being rental income in the UK, which is reported to the Board of directors on a quarterly basis. The Board of directors is considered to be the chief operating decision maker.

2.1. Basis of preparation

The condensed consolidated interim financial information for the six months ended 30 June 2022 has been prepared in accordance with International Accounting Standard No. 34, 'Interim Financial Reporting'. They do not include all of the information required for full annual financial statements and should be read in conjunction with the consolidated financial statements of the Company as at and for the year ended 31 December 2021.

These condensed interim financial statements for the six months ended 30 June 2022 and 30 June 2021 are unaudited and do not constitute full accounts. The comparative figures for the period ended 31 December 2021 are extracted from the 2021 audited financial statements. The independent auditor's report on the 2021 financial statements was not qualified.

All intra-group transactions, balances, income and expenses are eliminated in full on consolidation.

2.2. Going concern

The financial information has been prepared on the going concern basis as management consider that the Group has sufficient cash to fund its current commitments for the foreseeable future.

3. Earnings per share

                                                                                       Six months Six months Year 
                                                                                       ended      ended      ended 
                                                                                       30 Jun 22  30 Jun 21  31 Dec 21 
                                                                                       Unaudited  Unaudited  Audited 
The calculation of earnings per share is based on the following loss and number of 
shares: 
Profit/(loss) for the period (GBP'000)                                                   (327)      (82)       (294) 
 
Weighted average number of shares of the Company ('000)                                22,697     22,697     22,697 
Earnings per share: 
Basic and Diluted (GBP - pence)                                                        (1.44)     (0.36)     (1.30) 
 
Number of shares outstanding at the period end:                                        22,697,397 22,697,397 22,697,397 

4. Investment Properties

                                     Freehold   Leasehold 
                                     Investment Investment 
                                     Properties Properties Total 
                                     GBP000       GBP000       GBP000 
 
 
At 31 December 2020                  40         2,722      2,762 
Fair value adjustment - head leases   -         26         26 
Depreciation - head leases            -         (2)        (2) 
At 30 June 2021                      40         2,746      2,786 
Fair value adjustment - head leases   -         (1)        (1) 
Depreciation - head leases            -         (1)        (1) 
At 31 December 2021                  40         2,744      2,784 
Fair value adjustment - head leases   -         -           - 
Depreciation - head leases            -         (2)        (2) 
At 30 June 2022                      40         2,742      2,782 

The six property assets held at 30 September 2020 were valued at that date by Allsop LLP. Two of the larger assets were subject to full RICS valuations, including site inspections, with the remainder subject to desktop updates of their previous carrying values. In view of the market uncertainty and the operational restrictions arising from the COVID-19 outbreak, the directors did not consider it appropriate to carry out a fresh valuation of the property portfolio at the half-year. The six properties contained in the portfolio were therefore continued to be recognised in the financial statements at their holding value in the Company's accounts at 30 September 2020. One property was considered to be held for sale and its holding value in the Company's accounts therefore took account of agreed pricing and sales costs. There were no sales during the period.

The Directors are pleased to announce the completion of sale of the Westcliff property held for sale as at 31 December 2020 and 2021, which was agreed under the previous board in 2019 and has taken this reporting period to finalise.

The Directors have concluded that they will be maintaining the valuation of the property portfolio at previous levels. The Board is also of the opinion that the carrying values, based on the "Red Book" valuation, do not reflect the real value of the properties.

The Company's objective is still to liquidate the current portfolio of shopping assets which currently show a Gross Initial Yield of more than 16%, but only if a sale can achieve a sensible return in excess of the year end 2021 carrying value of GBP2.45m.

The Directors obtained pricing and yields of similar transactions made within the accounting period to December 2021 and compared them to the Gross Initial Yield stated above. In all cases the transactions that were measured came in at a lower value than that currently being achieved. As stated, although the data is below the Yield being achieved it was felt prudent to leave the valuations as they stand.

The outbreak of the Coronavirus (COVID-19), declared by the World Health Organization as a "Global Pandemic" on 11 March 2020, has impacted global financial markets and global economy. Despite the easing of restrictions, the future impact that COVID-19 might have on the real estate market gives that less certainty should be attached to the valuation than would normally be the case. A reconciliation of the portfolio valuation at 30 June 2022 to the total value for investment properties given in the Consolidated Balance Sheet is as follows:

                                                         As at     As at     As at 
                                                         30 Jun 22 30 Jun 21 31 Dec 21 
                                                         Unaudited Unaudited Audited 
                                                         GBP000      GBP000      GBP000 
 
Portfolio valuation                                      2,445     2,775     2,775 
Investment Properties held for sale                       -        (330)     (330) 
Head leases treated as investment properties per IFRS 16 337       341       339 
Total per Balance Sheet                                  2,782     2,786     2,784 

5. Investment Holdings

The Group classifies the following financial assets at fair value through profit or loss (FVPL):-

Equity investments that are held for trading

                                As at     As at     As at 
                                30 Jun 22 30 Jun 21 31 Dec 21 
                                Unaudited Unaudited Audited 
                                GBP000      GBP000      GBP000 
Securities investments 
At the beginning of the period  1,783      -         - 
Additions                       2,844     957       1,957 
Unrealised gain/(losses)        (169)     125       23 
Disposals                       (2,566)    -        (197) 
                                1,892     1,082     1,783 
 
Investment Holdings 
Securities held                 1,892     1,082     1,783 
Portfolio Holdings              788        -        36 
                                2,680     1,082     1,819 

Investments have been valued incorporating Level 1 inputs in accordance with IFRS7. They are a combination of cash and securities held with the listed broker.

Financial instruments require classification of fair value as determined by reference to the source of inputs used to derive the fair value. This classification uses the following three-level hierarchy:

Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities;

Level 2 - inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e., derived from prices);

Level 3 - inputs for the asset or liability that are not based on observable market data (unobservable inputs).

6. Lease liabilities

                                                                 Minimum 
Finance lease liabilities on head rents are payable as follows:  Lease 
                                                                 Payment Interest Principal 
                                                                 GBP000    GBP000     GBP000 
At 30 June 2021                                                  3,040   (2,694)  346 
Movement in value                                                (11)    11        - 
At 31 December 2021                                              3,029   (2,683)  346 
Movement in value                                                (11)    11        - 
At 30 June 2022                                                  3,018   (2,672)  346 
 
Short term liabilities                                           22       -       22 
Long term liabilities                                            3,018   (2,694)  324 
At 30 June 2021                                                  3,040   (2,694)  346 
Short term liabilities                                           22       -       22 
Long term liabilities                                            3,007   (2,683)  324 
At 31 December 2021                                              3,029   (2,683)  346 
Short term liabilities                                           22       -       22 
Long term liabilities                                            3,007   (2,683)  324 
At 30 June 2022                                                  3,029   (2,683)  346 

In the above table, interest represents the difference between the carrying amount and the contractual liability/ cash flow. All leases expire in more than five years.

7. Related party balances and transactions

As at the period end the Group owed GBP49,303 (December 2021: GBPnil, June 2021: GBP139,599) to Thalassa Holdings Limited ("Thalassa"), a company under common directorship. The balance relates to accounting and registered office services supplied to the Group by Thalassa at cost. The total amount is treated as an unsecured, interest free loan made repayable on demand.

During the period the Group was invoiced GBP88,887 (December 2021: GBP158,401, June 2021: GBP77,598) for consultancy and administrative services provided to the Group by a company in which the Chairman has a beneficial interest. The balance owed by the Group at the period end date was GBP88,887 (December 2021: nil, June 2021: GBP77,598)

8. Share capital

                                          As at     As at     As at 
                                          30 Jun 22 30 Jun 21 31 Dec 21 
                                          Unaudited Unaudited Audited 
                                          GBP         GBP         GBP 
 
Allotted, issued and fully paid: 
22,697,397 ordinary shares of GBP0.01 each  226,970   226,970   226,970 
 
9,164,017 treasury shares of GBP0.01 each   91,640    91,640    91,640 
 
Total Share Capital                       318,610   318,610   318,610 

During the year to 30 September 2019, the Company underwent a Court approved restructure of capital and buy back of shares. Under this action the issued 20p shares were converted to 1p; capital reserves were transferred to distributable reserves; 59,808,456 shares were repurchased, and a new Capital Redemption Reserve of GBP0.598m was established.

Investment in Own Shares

At the year-end, 9,164,017 shares were held in treasury (June 2021: 9,164,017), and at the date of this report 9,164,017 were held in treasury.

9. Subsequent events

There were no subsequent events.

10. Copies of the Interim Report

The interim report is available on the Company's website: www.alina-holdings.com.

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ISIN:           GB00B1VS7G47 
Category Code:  IR 
TIDM:           ALNA 
LEI Code:       213800SOAIB9JVCV4D57 
OAM Categories: 1.2. Half yearly financial reports and audit reports/limited reviews 
Sequence No.:   178537 
EQS News ID:    1410705 
 
End of Announcement  EQS News Service 
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Image link: https://eqs-cockpit.com/cgi-bin/fncls.ssp?fn=show_t_gif&application_id=1410705&application_name=news

 

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