TIDMTRC
RNS Number : 7313H
Trinity Capital PLC
22 August 2016
Trinity Capital PLC
Annual results for the year ended 31 March 2016
Trinity Capital PLC (AIM: TRC), a fund created for investing in
Indian real estate and infrastructure, announces its Annual Results
for the year ended 31 March 2016.
Further information, please contact:
FIM Capital Limited
Graham Smith +44 1624 681250
Arden Partners
Nominated Adviser and Broker
+44 207 614
Chris Hardie 5900
Chairman's Report
Dear Shareholder
The Board has conducted a detailed review of each of the three
remaining assets of Trinity Capital Plc ("Trinity" or the
"Company"), the prospects for generating further cash in the
foreseeable future, the scope to reduce operating costs and the
potential demands on existing cash balances held. As a result:
-- we have reduced the Company's net asset value ("NAV") to
GBP11.6 million (5.5p per share) at 31 March 2016 from GBP17.3
million (8.2p per share) at 30 September 2015 and GBP18.6 million
(8.8p per share) at 31 March 2015;
-- we will be embarking on a process to further reduce operating
costs in the coming months; and
-- we are today announcing a distribution of GBP2.1 million (1.0p per share).
Despite our continuing efforts, I am disappointed to report that
there have been no material developments with regard to our
negotiations with our Indian promoter-partners, the settlement of
our disputes with the funds managed by SachsenFonds (and their
partner, Deutsche Fonds Holding) or the various legal processes
underway in Mauritius. It is in the context of these impasses and
the projected shape that an eventual resolution might take that we
have reviewed Trinity's projected cash flow requirements and
operating costs and concluded that the proposed distribution is
appropriate.
Trinity's NAV fell by 37.5% to GBP11.6 million compared with the
previous year. At the end of the financial year, cash of GBP5.7
million was held by Trinity and INR742 million (equivalent to
GBP7.8 million at 31 March 2016) was held by Uppal IT in India.
There continues to be significant uncertainty as to when the
Mauritian courts will approve the application made by Trinity
Capital Mauritius Limited ("TCML") to place the Mauritius holding
vehicle of Uppal IT, Trinity Capital One Limited ("TC1"), into
liquidation following its failure to repay TCML's loan of GBP7.5
million. Appointment of a liquidator to sell TC1's assets should,
in due course, permit the distribution of the cash held by Uppal IT
to TC1 and then to TCML. Trinity is the majority owner of TC1 and
thereby its wholly owned subsidiary, Uppal IT. To date,
SachsenFonds has prevented Uppal IT from upstreaming cash to
TC1.
We continue to be hopeful that, in due course, Trinity will
generate further cash from the sale of the mezzanine securities
issued by BKC Realtors (formerly MK Malls). Although sales
documentation has finally been agreed with both the buyer and
SachsenFonds and a necessary regulatory clarification has been
received, the buyer's financing has yet to fall into place.
Investors will recall that, if and when a sale of the securities is
completed, the proceeds will remain trapped at the Mauritian
holding company pending agreement with SachsenFonds. We have valued
this investment on the assumptions that the German funds will enter
into a binding agreement and the lender will not withdraw. We have
also discounted the agreed net sales proceeds for the projected
time delay until funds are received by Trinity.
The financial position of the Lokhandwala group continues to
deteriorate. The joint venture in which Trinity Capital (Five)
Limited ("TC5") invested to develop and sell apartments in the
Minerva luxury residential tower in Mumbai's prestigious Worli
district is in default to its bank lenders. Construction has now
stopped for over six months and pressure from buyers and creditors
has significantly increased. Despite the apparent governmental
approval of a one third increase in the height of the Minerva
tower, construction cannot restart until the Lokhandwala group
refinances and raises further debt for the project. Demand for
luxury apartments in Mumbai remains subdued. Lokhandwala has yet to
brief TC5 on the effect of a refinancing on the value and timing of
an exit of TC5's equity interest. TC5 is currently considering all
options to protect the value of its investment.
Due to continuing commercial sensitivities, Trinity does not
publish the value of its individual investments in India. Whilst
most of the reduction in NAV during the financial year was due to a
revaluation of the underlying assets and operating expenses, 2.2%
of the movement was caused by the depreciation of the Rupee against
Sterling from 92.76 to 95.20. However, since the year-end, this
foreign exchange movement has reversed: at 31 July, the exchange
rate was 88.03. The Company does not hedge its currency
exposure.
Trinity's operating cost base remains high given the group
structure of companies in Mauritius and India and the management
issues that arise regularly with SachsenFonds on the boards of
subsidiaries. The Trinity group's total operating expenses during
the financial year amounted to GBP0.7 million, compared with GBP0.8
million in the previous year on a like-for-like basis. In an
attempt to reduce the erosion of the Company's value over time, we
will be implementing certain cost reductions in the coming months,
albeit on a prudent basis given that the investments must continue
to be protected.
We continue to maintain a GBP2.0 million provision for legal
costs projected to be incurred principally in connection with (i)
the TC1 liquidation proceedings in Mauritius; (ii) the German
funds' 2011 appeal to the Court of Appeal of Mauritius of the
Supreme Court's decision to dismiss their claims against Trinity on
jurisdictional grounds; and (iii) the protection of our investment
in the joint venture with the Lokhandwala group.
Since the end of 2010, Trinity has distributed an aggregate of
GBP148.4 million (70.5p per share). Following the latest review of
our projected operating costs and demands on our current cash
holding, we today announced a further distribution of GBP2.1
million (1.0p per share) to shareholders.
The Board appreciates your continued patience.
Yours faithfully
Martin M. Adams
Chairman
Directors' Report
The Directors have pleasure in presenting their report and
financial statements of the Company and its subsidiaries (the
"Group") for the year ended 31 March 2016.
Principal activity and incorporation
The Company is a closed-end investment company, incorporated on
7 March 2006 in the Isle of Man as a public limited company. Its
shares were admitted to trade on AIM (formerly the Alternative
Investment Market) of the London Stock Exchange on 21 April
2006.
The Group has invested in real estate and real estate related
entities in India, primarily in commercial development in the
office and business space, residential, retail, hospitality, and
infrastructure sectors deriving returns from development, long-term
capital appreciation and income.
In March 2009, shareholders voted to change the Company's
investment policy by requiring the Company to gradually dispose of
its assets over time and return capital to investors.
The Group has no employees.
The consolidated financial statements comprise the results of
the Group.
Results and dividends
The Group's results for the financial year ended 31 March 2016
are set out in the Consolidated Statement of Comprehensive
Income.
A review of the Group's activities is set out in the Chairman's
Report. No Investment Manager's Report is presented, as such a
report is no longer considered relevant for a proper understanding
of the Group's affairs. Details of the Group's interest in the
remaining three investments are given in the Summary of
Investments.
During the year, the Company paid no distributions (2015: GBP5.3
million). The Company today announced a distribution to
shareholders of GBP2.1 million (1.0p per share), payable on 23
September 2016 to shareholders on the register as at 2 September
2016. The shares will be marked "ex" on 1 September 2016.
Directors
The Directors of the Company during the year and to date of this
report were as follows:
Martin Adams (Chairman)
John Chapman
Stephen Coe
Graham Smith
Pradeep Verma
None of the Directors had interests in the shares of the Company
at 31 March 2016 (2015: none). Details of the Directors'
remuneration are provided in note 6.
Company Secretary
The secretary of the Company during the year and at the date of
this report was Philip Scales.
Auditors
The auditors, KPMG Audit LLC, being eligible, have expressed
their willingness to continue in office in accordance with Section
12(2) of the Isle of Man Companies Act 1982.
On behalf of the Board
Graham Smith
Director
18 August 2016
Summary of Investments
Uppals IT Park "Tech Oasis"
Indian Investee Company Uppals IT Projects Private
Limited
-------------------------- ----------------------------------
Mauritian SPV Trinity Capital (One) Limited
("TC1")
-------------------------- ----------------------------------
Local Promoter/ Partner n.a.
-------------------------- ----------------------------------
Location Greater Noida, National Capital
Region (NCR),
Uttar Pradesh
-------------------------- ----------------------------------
Project Development of IT/ITES project
with Residential and Commercial
Space
-------------------------- ----------------------------------
Development potential 10.16 million sq. ft., basis
above product mix
-------------------------- ----------------------------------
Date of Investment October 2006
-------------------------- ----------------------------------
Ownership of TC1 Trinity Capital Mauritius Limited
: 67%*
Immobilien Development Indien
I GmbH & Co. KG : 8%
Immobilien Development Indien
II GmbH & Co. KG : 25%
-------------------------- ----------------------------------
TC1's interest in Indian
Investee Company 100%
-------------------------- ----------------------------------
*Trinity Capital Mauritius Limited also provided GBP7.5 million
of mezzanine debt to TC1 in October 2008.
Lokhandwala
Indian Investee Company Lokhandwala Kataria Constructions
Pvt. Ltd
--------------------------- -------------------------------------
Mauritian SPV Trinity Capital (Five) Limited
("TC5")
--------------------------- -------------------------------------
Local Promoter/ Developer Lokhandwala Group
--------------------------- -------------------------------------
Location Mahalaxmi, Mumbai, Maharashtra
--------------------------- -------------------------------------
Project Redevelopment project under
a slum clearance scheme for
development and sale of residential
units and parking
--------------------------- -------------------------------------
Development potential 929,215 sq. ft., basis above
product mix
--------------------------- -------------------------------------
Date of Investment October 2006: GBP6.26m
October 2009: GBP6.18m
--------------------------- -------------------------------------
Ownership of TC5 Trinity Capital Mauritius Limited
: 59%
Immobilien Development Indien
I GmbH & Co. KG : 41%
--------------------------- -------------------------------------
TC5's interest in Indian
Investee Company 49%
--------------------------- -------------------------------------
DB (BKC) Realtors
Indian Investee Company DB (BKC) Realtors Private Limited
(formerly MK Malls & Developers
Pvt. Ltd.)
-------------------------- -----------------------------------
Mauritian SPV Trinity Capital (Ten) Limited
("TC10")
-------------------------- -----------------------------------
Local Promoter/ Developer Dynamix Balwas Group
-------------------------- -----------------------------------
Location Bandra Kurla Complex, Mumbai
-------------------------- -----------------------------------
Project Commercial Office development
-------------------------- -----------------------------------
Date of Investment December 2006 : GBP5.9 million
January 2008 : GBP6.4 million
-------------------------- -----------------------------------
Ownership of TC10 Immobilien Development Indien
I GmbH & Co. KG : 40%
Immobilien Development Indien
II GmbH & Co. KG : 48%
Trinity Capital Mauritius Limited
: 12%
-------------------------- -----------------------------------
TC10's investment in DB (BKC) Realtors Private Limited consists
of (a) equity; (b) redeemable optionally convertible cumulative
preference shares (ROCCPS); and (c) compulsorily convertible
preference shares (CCPS). In 2007 and 2008, the capital structure
of TC10 was reorganised such that the shares acquired by Immobilien
I and Immobilien II in TC10 provided the economic interest in the
equity and ROCCPS. TCML was issued with shares in TC10 which
provide the economic interest in the CCPS, with a return on equity
capped at an IRR of 20%.
Statement of Directors' Responsibilities in Respect of the
Annual Report and the Financial Statements
The Directors are responsible for preparing the Directors'
Report and the financial statements in accordance with applicable
law and regulations.
Company law requires the Directors to prepare financial
statements for each financial year, which meet the requirements of
Isle of Man company law. In addition, the Directors have elected to
prepare the financial statements in accordance with International
Financial Reporting Standards, as adopted by the EU.
The financial statements are required by law to give a true and
fair view of the state of affairs of the Group and Parent Company
and of the profit or loss of the Group for that period.
In preparing these financial statements, the Directors are
required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and estimates that are reasonable and prudent;
-- state whether they have been prepared in accordance with
International Financial Reporting Standards, as adopted by the EU;
and
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Group and Parent
Company will continue in business.
The Directors are responsible for keeping proper accounting
records that are sufficient to show and explain the Parent
Company's transactions and disclose with reasonable accuracy at any
time the financial position of the Parent Company and to enable
them to ensure that its financial statements comply with the
Companies Acts 1931 to 2004. They have general responsibility for
taking such steps as are reasonably open to them to safeguard the
assets of the Group and to prevent and detect fraud and other
irregularities.
The Directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
Company's website. Legislation governing the preparation and
dissemination of financial statements may differ from one
jurisdiction to another.
Corporate Governance Statement
The UK Corporate Governance Code does not directly apply to
companies incorporated in the Isle of Man but the Board of
Directors (the "Board") has developed internal procedures in line
with the recommendations of the UK Corporate Governance Code where
appropriate and these are reviewed on a regular basis. The
Directors will continue to comply with the relevant requirements of
the UK Corporate Governance Code to the extent that they consider
it appropriate having regard to the Company's size and the nature
of its operations. The Board is not aware of any reason that would
cause it to reconsider its current approach.
Responsibilities of the Board
The Board is responsible for the implementation of the
investment policy of the Company and for its overall supervision
via the investment policy and objectives approved by shareholders.
At each of the Company's regular Board meetings, the financial
performance of the Group and its portfolio investments are
reviewed.
The Board is also ultimately responsible for the Group's
day-to-day operations, but in order to fulfil its obligations, the
Board has delegated operations through arrangements with the
Investment Manager and the Administrator. All Board members are
non-executive.
Audit Committee
The Audit Committee is a sub-committee of the Board and makes
recommendations to the Board which retains the right of final
decision. The Audit Committee has primary responsibility for
reviewing the financial statements and the accounting policies,
principles and practice underlying them, liaising with the external
auditors and reviewing the effectiveness of internal controls. The
Audit Committee maintains a risk register to help it identify,
evaluate, monitor and control risks. The Committee members are
Stephen Coe (Chairman), Martin Adams, John Chapman, and Pradeep
Verma.
The terms of reference of the Audit Committee include the
following:
-- duties in relation to external reporting, including reviews
of financial statements, shareholder communications and other
announcements;
-- duties in relation to the external auditors, including
appointment/ dismissal, approval of fee, discussion of the audit;
and
-- duties in relation to internal systems, procedures and controls.
Remuneration and Nomination Committee
The Remuneration and Nomination Committee is a sub-committee of
the Board and makes recommendations to the Board which retains the
right of final decision. The Committee members are Stephen Coe
(Chairman) and Martin Adams.
The terms of reference of the Committee include the
following:
-- set the remuneration of the Directors;
-- demonstrate to the shareholders of the Company that the
remuneration of the non-executive Directors of the Company and each
of its subsidiaries is set by a committee of the Board whose
members have no personal interest in the outcome of the decisions
of such committee and who will have due regard to the interests of
shareholders;
-- to the extent that any executive or non-executive Director
may be invited to join meetings of the Committee as appropriate he
shall absent himself and take no part in any discussions concerning
his own remuneration or other benefits or matters within the
province of the Committee; and
-- consider the appropriateness of the Board's composition, and
assess the suitability of potential Board members.
The Committee is authorised by the Board to:
-- when the fulfilment of its duties requires, obtain any
outside legal or other professional advice including the advice of
independent remuneration consultants, to secure the attendance of
external advisers at its meetings, if it considers this necessary,
and to obtain reliable, up-to-date information about remuneration
in other companies, at the expense of the Company. The Committee
has full authority to commission any reports or surveys which it
deems necessary to help it fulfil its obligations; and
-- when the fulfilment of its duties requires, to obtain any
outside legal or other professional advice including the advice of
independent recruitment consultants and to secure the attendance of
external advisers at its meetings, if it considers this necessary,
at the expense of the Company. The Committee has full authority to
commission any reports or assistance which it deems necessary to
help it fulfil its obligations.
Legal Committee
The Legal Committee is a sub-committee of the Board and makes
recommendations to the Board which retains the right of final
decision. The Legal Committee's primary responsibility is to
oversee the disputes which the Group is currently involved in. The
Committee members are John Chapman (Chairman), Martin Adams and
Graham Smith.
Investment Committee
The Investment Committee is a sub-committee of the Board and
makes recommendations to the Board which retains the right of final
decision. The Investment Committee's primary responsibility is to
oversee the realisation of the Company's portfolio of investments
in consultation with the Investment Manager in accordance with the
Company's investment policy. The Committee members are Martin Adams
(Chairman), John Chapman and Pradeep Verma.
Report of the Independent Auditors, KPMG Audit LLC, to the
members of Trinity Capital PLC
We have audited the financial statements of Trinity Capital plc
for the year ended 31 March 2016 which comprise the Consolidated
Statement of Comprehensive Income, the Consolidated and Parent
Company Statements of Financial Position, the Consolidated and
Parent Company Statements of Changes in Equity, the Consolidated
Statement of Cash Flows and the related notes. The financial
reporting framework that has been applied in their preparation is
applicable law and International Financial Reporting Standards
(IFRSs), as adopted by the EU.
This report is made solely to the Company's members, as a body,
in accordance with Section 15 of the Companies Act 1982. Our audit
work has been undertaken so that we might state to the Company's
members those matters we are required to state to them in an
auditor's report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to
anyone other than the Company and the Company's members as a body,
for our audit work, for this report, or for the opinions we have
formed.
Respective responsibilities of Directors and Auditor
As explained more fully in the Directors' Responsibilities
Statement, the Directors are responsible for the preparation of
financial statements that give a true and fair view. Our
responsibility is to audit, and express an opinion on, the
financial statements in accordance with applicable law and
International Standards on Auditing (UK and Ireland). Those
standards require us to comply with the Auditing Practices Board's
(APB's) Ethical Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and
disclosures in the financial statements sufficient to give
reasonable assurance that the financial statements are free from
material misstatement, whether caused by fraud or error. This
includes an assessment of: whether the accounting policies are
appropriate to the Group's circumstances and have been consistently
applied and adequately disclosed; the reasonableness of significant
accounting estimates made by the Directors; and the overall
presentation of the financial statements. In addition we read the
financial and non-financial information in the annual report to
identify material inconsistencies with the audited financial
statements and to identify any information that is apparently
materially incorrect based on, or materially inconsistent with, the
knowledge acquired by us in the course of performing the audit. If
we become aware of any apparent material misstatements or
inconsistencies we consider the implications for our report.
Opinion on the financial statements
In our opinion the financial statements:
-- give a true and fair view of the state of the Group's and
Parent Company's affairs as at 31 March 2016 and of the Group's
loss for the year then ended;
-- have been properly prepared in accordance with IFRSs as adopted by the EU; and
-- have been properly prepared in accordance with the provisions
of the Companies Acts 1931 to 2004.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters
where the Companies Acts 1931 to 2004 require us to report to you
if, in our opinion:
-- proper books of account have not been kept by the Parent
Company and proper returns adequate for our audit have not been
received from branches not visited by us; or
-- the Parent Company's statement of Financial Position and
Statement of Comprehensive Income are not in agreement with the
books of account and returns; or
-- certain disclosures of Directors' remuneration specified by law are not made; or
-- we have not received all the information and explanations we require for our audit.
KPMG Audit LLC
Chartered Accountants
Heritage Court
41 Athol Street
Douglas
Isle of Man IM99 1HN
19 August 2016
Consolidated Statement of Comprehensive Income
for the year ended 31 March 2016
Notes 2016 2015
--------------------------------------- ------ -------- ---------
GBP'000 GBP'000
Fair value movement on investments 11 (7,806) 7,912
Net loss on disposal of investments - (12,416)
Interest income from cash
and cash equivalents 25 23
Foreign exchange (loss)/gain (6) 20
--------------------------------------- ------ -------- ---------
Net investment loss (7,787) (4,461)
--------------------------------------- ------ -------- ---------
Investment management fees 4 (133) (125)
Other administration fees
and expenses 5 (593) (739)
Total expenses (726) (864)
--------------------------------------- ------ -------- ---------
Loss before tax (8,513) (5,325)
Taxation 7 - -
Loss for the year (8,513) (5,325)
--------------------------------------- ------ -------- ---------
Other comprehensive income - -
Total comprehensive loss (8,513) (5,325)
--------------------------------------- ------ -------- ---------
Total comprehensive loss attributable
to:
Equity holders of the Company (6,969) (4,289)
Non-controlling Interest (1,544) (1,036)
--------------------------------------- ------ -------- ---------
Loss for the year (8,513) (5,325)
--------------------------------------- ------ -------- ---------
Basic and diluted loss per
share (pence) 8 (3.3) (2.0)
--------------------------------------- ------ -------- ---------
The notes form an integral part of the financial statements.
Consolidated and Company Statements of Financial Position
as at 31 March 2016
Group Company
------------------ ------------------
Notes 2016 2015 2016 2015
------------------------------- ------ -------- -------- -------- --------
GBP'000 GBP'000 GBP'000 GBP'000
Non-current assets
Investments in subsidiaries 10 - - 8,234 14,634
Investments at fair
value through profit
or loss 11 8,272 16,078 - -
------------------------------- ------ -------- -------- -------- --------
Total non-current assets 8,272 16,078 8,234 14,634
------------------------------- ------ -------- -------- -------- --------
Current assets
Trade and other receivables 1 3 - -
Cash and cash equivalents 12 5,656 6,381 5,557 6,146
Prepayments 30 13 21 4
------------------------------- ------ -------- -------- -------- --------
Total current assets 5,687 6,397 5,578 6,150
------------------------------- ------ -------- -------- -------- --------
Total assets 13,959 22,475 13,812 20,784
------------------------------- ------ -------- -------- -------- --------
Liabilities
Non-current liabilities
Provision for legal
costs 13 (2,000) (2,000) (2,000) (2,000)
------------------------------- ------ -------- -------- -------- --------
Total non-current liabilities (2,000) (2,000) (2,000) (2,000)
------------------------------- ------ -------- -------- -------- --------
Current liabilities
Trade and other payables (342) (345) (195) (198)
------------------------------- ------ -------- -------- -------- --------
Total current liabilities (342) (345) (195) (198)
------------------------------- ------ -------- -------- -------- --------
Total liabilities (2,342) (2,345) (2,195) (2,198)
------------------------------- ------ -------- -------- -------- --------
Net assets 11,617 20,130 11,617 18,586
------------------------------- ------ -------- -------- -------- --------
Represented by:
Ordinary shares 14 2,107 2,107 2,107 2,107
Capital redemption reserves 214 214 214 214
Retained reserves 9,296 16,265 9,296 16,265
------------------------------- ------ -------- -------- -------- --------
Total equity attributable
to equity holders of the
Company 11,617 18,586 11,617 18,586
Non-controlling interest - 1,544 - -
------------------------------- ------ -------- -------- -------- --------
Total equity 11,617 20,130 11,617 18,586
------------------------------- ------ -------- -------- -------- --------
Net Asset Value per
share (pence) 15 5.5 8.8
The notes form an integral part of the financial statements.
These financial statements were approved by the Board on 18
August 2016 and signed on their behalf by
Stephen Coe Graham Smith
Director Director
Consolidated and Company Statements of Changes in Equity
for the year ended 31 March 2016
Share Capital Capital Retained Shareholders' Non-controlling Total Equity
Redemption Reserves Funds Interest
Reserve
GBP '000 GBP '000 GBP '000 GBP '000 GBP '000 GBP '000
Consolidated
Balance at 31
March 2014 2,107 214 25,815 28,136 2,580 30,716
Total
comprehensive
loss - - (4,289) (4,289) (1,036) (5,325)
Distribution - - (5,261) (5,261) - (5,261)
Balance at 31
March 2015 2,107 214 16,265 18,586 1,544 20,130
---------------- -------------- --------------- ---------------- ---------------- ---------------- -------------
Balance at 31
March 2015 2,107 214 16,265 18,586 1,544 20,130
Total
comprehensive
loss - - (6,969) (6,969) (1,544) (8,513)
Balance at 31
March 2016 2,107 214 9,296 11,617 - 11,617
---------------- -------------- --------------- ---------------- ---------------- ---------------- -------------
Company
Balance at 31
March 2014 2,107 214 28,395 30,716 - 30,716
Total
comprehensive
loss - - (6,869) (6,869) - (6,869)
Distribution - - (5,261) (5,261) - (5,261)
Balance at 31
March 2015 2,107 214 16,265 18,586 - 18,586
---------------- -------------- --------------- ---------------- ---------------- ---------------- -------------
Balance at 31
March 2015 2,107 214 16,265 18,586 - 18,586
Total
comprehensive
loss - - (6,969) (6,969) - (6,969)
-
---------------- ---------------- -------------
Balance at 31
March 2016 2,107 214 9,296 11,617 - 11,617
---------------- -------------- --------------- ---------------- ---------------- ---------------- -------------
The notes on form an integral part of the financial
statements.
Consolidated Statement of Cash Flows
for the year ended 31 March 2016
2016 2015
GBP'000 GBP'000
Cash flows from operating activities
Loss for the year (8,513) (5,325)
Adjustments for:
Interest income from cash and cash equivalents (25) (23)
Movement in foreign exchange 6 (20)
Fair value movement on investments 7,806 (7,912)
Net realised loss on disposal of investments - 12,416
------------------------------------------------------ -------- --------
Net cash flows from operations before changes
in working capital (726) (864)
------------------------------------------------------ -------- --------
Changes in working capital
(Increase)/decrease in receivables (15) 33
Decrease in payables (3) (66)
------------------------------------------------------ -------- --------
Net cash used by operating activities (744) (897)
------------------------------------------------------ -------- --------
Cash flows from investing activities
Interest income from cash and cash equivalents 25 23
Proceeds from disposal of investments - 4,883
------------------------------------------------------ -------- --------
Net cash from investing activities 25 4,906
------------------------------------------------------ -------- --------
Cash flows from financing activities
Distributions - (5,261)
Net cash outflow from financing activities - (5,261)
------------------------------------------------------ -------- --------
Net decrease in cash and cash equivalents (719) (1,252)
Cash and cash equivalents at the start of the year 6,381 7,613
Effect of foreign exchange fluctuation on cash held (6) 20
Cash and cash equivalents at the end of the year 5,656 6,381
------------------------------------------------------ -------- --------
The notes on form an integral part of the financial
statements.
Notes to the Financial Statements
for the year ended 31 March 2016
1. General information
The Company is a closed-end investment company incorporated on 7
March 2006 in the Isle of Man as a public limited company. The
address of its registered office is IOMA House, Hope Street,
Douglas, Isle of Man, IM1 1AP.
The Company is listed on the AIM Market ("AIM") of the London
Stock Exchange.
The Company and its subsidiaries (together the "Group") invest
in real estate and real estate related entities in India, primarily
in commercial development in the office and business space,
residential, retail, hospitality and infrastructure sectors
deriving returns from development, long-term capital appreciation
and income.
In March 2009, shareholders voted to change the Company's
investment policy by requiring the Company to gradually dispose of
its assets over time and return capital to investors.
The Group has no employees.
The consolidated financial statements were authorised for issue
by the Board on 18 August 2016.
2. Summary of significant accounting policies
2.1. Basis of preparation
(a) Statement of compliance
The financial statements have been prepared in accordance with
International Financial Reporting Standards ("IFRSs") as adopted by
the EU.
(b) Basis of measurement
The consolidated financial statements have been prepared on the
historical cost basis except for financial instruments at fair
value through profit or loss which are measured at fair value in
the statement of financial position.
(c) Functional and presentation currency
These financial statements are presented in Sterling, which is
the Company's functional currency. All financial information
presented in Sterling has been rounded to the nearest thousand.
(d) Use of estimates and judgements
The preparation of the financial statements in conformity with
IFRSs requires management to make judgements, estimates and
assumptions that affect the application of accounting policies and
the reported amounts of assets, liabilities, income and expenses.
Actual results may differ from these estimates. Estimates and
underlying assumptions are reviewed on an ongoing basis. Revisions
to accounting estimates are recognised in the period in which the
estimates are revised and in any future periods affected.
The areas involving a higher degree of judgment or complexity,
or areas where assumptions and estimates are significant to the
consolidated financial statements are disclosed in note 3.
2.2. Basis of Consolidation
The consolidated financial statements incorporate the financial
statements of the Company and entities controlled by the Company
(its subsidiaries and subsidiary undertakings). Control is achieved
where the Company has power over an investee, exposure or rights to
variable returns and the ability to exert power to affect those
returns.
The results of subsidiaries acquired or disposed of during the
year are included in the consolidated Statement of Comprehensive
Income from the effective date of acquisition or up to the
effective date of disposal, as appropriate.
Where necessary, adjustments are made to the financial
statements of subsidiaries to bring the accounting policies used
into line with those used by the Group. All intra-group
transactions, balances, income and expenses are eliminated on
consolidation.
As an investment entity under the terms of the amendments to
IFRS 10 Consolidated Financial Statements the Company is not
permitted to consolidate its controlled portfolio entities. Control
is achieved where the Company has the power to govern the financial
and operating policies of an entity company so as to obtain
benefits from its activities.
The Directors consider the Company to be an investment entity as
defined by IFRS 10 Consolidated Financial Statements as it meets
the following criteria as determined by the accounting
standard:
-- Obtains funds from one or more investors for the purpose of
providing those investors with investment management services;
-- Commits to its investors that its business purpose is to
invest funds solely for returns from capital appreciation,
investment income or both; and
-- Measures and evaluates the performance of substantially all
of its investments on a fair value basis.
Accordingly, the consolidated financial statements incorporate
the financial statements of the Company and the financial
statements of the intermediate investment holding companies, but
the interests of the intermediate holding companies in the Indian
project SPVs are stated at fair value, as described in note 11.
2.3. Segment reporting
A business segment is a group of assets and operations engaged
in providing products or services that are subject to risks and
returns that are different from those of other business segments. A
geographical segment is engaged in providing products or services
within a particular economic environment that are subject to risks
and returns which are different from those of segments operating in
other economic environments.
The Directors are of the opinion that the Group is engaged in a
single segment of business being property investment business in
one geographical area being India. See note 11.
2.4. Revenue recognition
Revenue includes interest receivable, dividend income and fair
value gains and losses. Interest receivable is accrued on a time
basis by reference to the principal outstanding and the effective
interest rate applicable.
Fair value gains and losses are recognised in the period of
revaluation. Dividend income from investments is recognised when
the Company's right to receive payment has been established,
normally the ex-dividend date.
2.5. Expenses
All expenses are accounted for on an accruals basis and are
presented as revenue items except for expenses that are incidental
to the sale of an investment which are deducted from the disposal
proceeds.
2.6. Taxation
Income tax expense comprises current and deferred tax. Current
tax and deferred tax are recognised in profit or loss except to the
extent that it relates to a business combination, or items
recognised directly in equity or in other comprehensive income.
Current tax is the expected tax payable or receivable on the
taxable income or loss for the year, using tax rates enacted or
substantively enacted at the reporting date, and any adjustment to
tax payable in respect of previous years. Current tax payable also
includes any tax liability arising from the declaration of
dividends.
Deferred tax is recognised in respect of temporary differences
between the carrying amounts of assets and liabilities for
financial reporting purposes and the amounts used for taxation
purposes. Deferred tax is not recognised for:
-- temporary differences on the initial recognition of assets or
liabilities in a transaction that is
not a business combination and that affects neither accounting
nor taxable profit or loss;
-- temporary differences related to investments in subsidiaries
and jointly controlled entities to
the extent that it is probable that they will not reverse in the
foreseeable future; and
-- taxable temporary differences arising on the initial recognition of goodwill.
Deferred tax is measured at the tax rates that are expected to
be applied to temporary differences when they reverse, based on the
laws that have been enacted or substantively enacted by the
reporting date.
Deferred tax assets and liabilities are offset if there is a
legally enforceable right to offset current tax liabilities and
assets, and they relate to income taxes levied by the same tax
authority on the same taxable entity, or on different tax entities,
but they intend to settle current tax liabilities and assets on a
net basis or their tax assets and liabilities will be realised
simultaneously.
A deferred tax asset is recognised for unused tax losses, tax
credits and deductible temporary differences, to the extent that it
is probable that future taxable profits will be available against
which they can be utilised. Deferred tax assets are reviewed at
each reporting date and are reduced to the extent that it is no
longer probable that the related tax benefit will be realised.
2.7. Foreign currency transactions
(a) Functional and presentation currency
Items included in the financial statements of each of the
Group's entities are measured using
the currency of the primary economic environment in which the
entity operates ('the functional currency'). The consolidated
financial statements are presented in Sterling, which is the
Company's functional and presentation currency.
(b) Transactions and balances
Transactions in foreign currencies are translated to the
respective functional currencies of Group entities at exchange
rates at the dates of the transactions. Monetary assets and
liabilities denominated in foreign currencies at the reporting date
are translated to the functional currency at the exchange rate at
that date. The foreign currency gain or loss on monetary items is
the difference between amortised cost in the functional currency at
the beginning of the year, adjusted for effective interest and
payments during the year, and the amortised cost in foreign
currency translated at the exchange rate at the end of the
year.
Non-monetary assets and liabilities denominated in foreign
currencies that are measured at fair value are translated to the
functional currency at the exchange rate at the date that the fair
value was determined. Non-monetary items in a foreign currency that
are measured in terms of historical cost are translated using the
exchange rate at the date of the transaction. Foreign currency
differences arising on translation are recognised in profit or
loss, except for differences arising on the translation of
available-for-sale equity investments, a financial liability
designated as a hedge of the net investment in a foreign operation
that is effective, or qualifying cash flow hedges, which are
recognised in other comprehensive income.
(c) Foreign operations
The assets and liabilities of foreign operations, including
goodwill and fair value adjustments arising on acquisition, are
translated to Sterling at exchange rates at the reporting date. The
income and expenses of foreign operations are translated to
Sterling at exchange rates at the dates of the transactions.
Foreign currency differences are recognised in other
comprehensive income, and presented in the foreign currency
translation reserve (translation reserve) in equity. However, if
the operation is a non-wholly-owned subsidiary, then the relevant
proportionate share of the translation difference is allocated to
the non-controlling interests. When a foreign operation is disposed
of such that control, significant influence or joint control is
lost, the cumulative amount in the translation reserve related to
that foreign operation is reclassified to profit or loss as part of
the gain or loss on disposal. When the Group disposes of only part
of its interest in a subsidiary that includes a foreign operation
while retaining control, the relevant proportion of the cumulative
amount is reattributed to non-controlling interests. When the Group
disposes of only part of its investment in an associate or joint
venture that includes a foreign operation while retaining
significant influence or joint control, the relevant proportion of
the cumulative amount is reclassified to profit or loss.
When the settlement of a monetary item receivable from or
payable to a foreign operation is neither planned nor likely in the
foreseeable future, foreign exchange gains and losses arising from
such a monetary item are considered to form part of a net
investment in a foreign operation and are recognised in other
comprehensive income, and presented in the translation reserve in
equity.
2.8. Financial instruments
Financial assets and financial liabilities are recognised when a
Group entity becomes a party to the contractual provisions of a
financial instrument. Financial assets and financial liabilities
are offset if there is a legally enforceable right to set off the
recognised amounts and interests and it is intended to settle on a
net basis.
Investments in portfolio entities are designated as at fair
value through profit or loss on initial recognition and are
measured at fair value. Unrealised gains and losses arising from
revaluation are recognised in profit or loss.
The fair value of unquoted securities is estimated by the
Directors using the most appropriate valuation technique for each
investment.
Securities quoted or traded on a recognised stock exchange or
other regulated market are valued by reference to the last
available market price.
2.9. Provisions
A provision is recognised in the statement of financial position
when the Group has a present legal or constructive obligation as a
result of a past event, and it is probable that an outflow of
economic benefits will be required to settle the obligation, and
the obligation can be reliably measured. If the effect is material,
provisions are determined by discounting the expected future cash
flows at a pre-tax rate that reflects current market assessments of
the time value of money and, where appropriate, the risks specific
to the liability.
2.10. Standards and interpretations not yet effective
There are no standards or interpretations with an effective date
on or after 1 January 2016 that are likely to have a significant
effect on the financial statements.
3. Critical accounting estimates and assumptions
These disclosures supplement the commentary on financial risk
management (see note 18).
Key sources of estimation uncertainty
Determining fair values
The determination of fair values for financial assets for which
there are no observable market prices requires the use of valuation
techniques as described in accounting policy note 2.8. For
financial instruments that trade infrequently and have little price
transparency, fair value is less objective, and requires varying
degrees of judgement depending on liquidity, concentration,
uncertainty of market factors, pricing assumptions and other risks
affection the specific instrument. See also "Valuation of financial
instruments" below.
Critical judgements in applying the Company's accounting
policies
Critical judgements made in applying the Company's accounting
policies include:
Valuation of financial instruments
The Company's accounting policy on fair value measurements is
discussed in accounting policy note 2.8. The Company measures fair
value using the following hierarchy that reflects the significant
of inputs used in making the measurements:
-- Level 1: Quoted market price (unadjusted) in an active market for and identical instrument.
-- Level 2: Valuation techniques based on observable inputs,
either directly (i.e. as prices) or indirectly (i.e. derived from
prices). This category included instruments valued using: quoted
market prices in active markets for similar instruments: quoted
market prices for identical or similar instruments in markets that
are considered less than active; or other valuation techniques
where all significant inputs are directly or indirectly observable
from market data.
-- Level 3: Valuation techniques using significant unobservable
inputs. This category includes all instruments where the valuation
technique includes inputs not based on observable data and the
unobservable inputs have a significant effect on the instrument's
valuation. This category includes instruments that are valued based
on quoted prices for similar instruments where significant
unobservable adjustments or assumptions are required to reflect
differences between the instruments.
All the Company's investments measured at fair value have been
valued on the basis of Level 3 described above.
A reconciliation from the beginning balances to the ending
balances for Level 3 investments is as follows:
2016 2015
GBP'000 GBP'000
Beginning of period 16,078 20,954
Disposals- fair value at beginning
of period - (3,181)
Fair value adjustment (7,806) (1,695)
--------- ---------
End of period 8,272 16,078
--------- ---------
Financial instruments not measured at fair value
The carrying value of short-term financial assets and financial
liabilities (cash, debtors and creditors) approximate their fair
value.
Estimated future legal fees
As described in note 16, the Group is engaged in litigation. A
provision has been made for the associated legal costs, but this
amount cannot be calculated with any certainty. The actual amount
may differ significantly, and will depend on the duration and
complexity of the litigation, and the success or otherwise in
reaching settlement with the other parties.
4. Investment management fees and performance fees
The Investment Management Agreement with Indiareit Investment
Management Company ("Indiareit") expired on 31 December 2013.
However, Indiareit continues to provide investment management
services to the Company with performance fees being negotiated on
an ad hoc basis and the Company has continued to pay the regular
investment management fee of US$198,000 per annum (GBP133,000).
During the year, no performance fee was paid to Indiareit.
5. Other administration fees and expenses
2016 2015
GBP'000 GBP'000
Administration fees 147 162
Audit fees 33 53
Directors' fees (note 6) 171 239
Insurance premia 18 38
Legal fees 47 41
NOMAD & broker fees 42 42
Valuations fees 39 32
Other professional costs 56 53
Other costs 40 79
593 739
======== ========
6. Directors' remuneration
Details of Directors' remuneration during the year are as
follows:
Martin Pradeep Stephen John 2016 2015
Adams Verma Coe Chapman Total Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Fixed fees 45 30 41 55 171 171
Payments under
incentive plan - - - - - 68
45 30 41 55 171 239
======== ======== ======== ========= ======== ========
The Directors' Incentive Plan ("DIP") was approved by
Shareholders on 29 November 2012, and provides for payments to
Martin Adams, Pradeep Verma and John Chapman amounting, in
aggregate to 1.3% of amounts distributed to shareholders.
7. Taxation
There is no liability for income tax in the Isle of Man.
The Mauritian subsidiaries are subject to income tax in
Mauritius at the rate of 15% on the chargeable income. The
Mauritian subsidiaries are, however, entitled to a tax credit
equivalent to the higher of the foreign tax paid and a deemed
credit of 80% of the Mauritian tax on their foreign source income.
No provision has been made in the financial statements due to the
availability of tax losses.
8. Loss per share
Basic loss per share is calculated by dividing the net loss
attributable to equity shareholders of the parent by the weighted
average number of ordinary shares outstanding during the year.
2016 2015
Loss attributable to equity shareholders of the parent (GBP'000) (6,969) (4,289)
Weighted average number of ordinary shares (thousands)
for the purposes of basic loss per share 210,682 210,682
-------- --------
Basic loss per share (pence) (3.3) p (2.0) p
======== ========
There is no difference between fully diluted loss per share and
basic loss per share.
9. Distributions
During the year, the Company paid no distributions (2015: GBP5.3
million).
10. Investments in subsidiaries
The Company has the following subsidiaries incorporated in
Mauritius. They are recorded at cost in the financial statements of
the Company less provision for impairment.
Name Proportion of ownership
interest
At 31 March At 31 March
2016 2015
Trinity Capital Mauritius
Limited 100% 100%
Trinity Capital (One)
Limited 67% 67%
Trinity Capital (Four)
Limited 100% 100%
Trinity Capital (Five)
Limited 59% 59%
Trinity Capital (Ten)
Limited 12% 12%
Trinity Capital (Seventeen)
Limited (dissolved) - 100%
Trinity Capital (Nineteen)
Limited 100% 100%
In addition to above subsidiaries, Trinity Capital (One) Limited
holds 100% of the total equity share capital of
Uppal IT Projects Private Limited ("Uppal"). In accordance with
the amendments to IFRS 10 for investment entities, as a controlled
portfolio entity Uppal is not consolidated but instead the
Company's interest is stated at fair value.
11. Investments - designated at fair value through profit or loss
The Group holds indirect full or partial ownership interests in
three unquoted Indian companies - Lokhandwala Kataria Constructions
Pvt. Ltd ("LKCPL"), Uppal and DB (BKC) Realtors Private Limited
("MK Malls").
Uppal has been valued at the amount of cash that is expected to
be available to the Company (through its subsidiaries) in the event
of liquidation. The value of the investment in MK Malls is based on
the net sales proceeds to be received under the terms of a final
draft (but not yet binding) sales agreement. LKCPL has been valued
based on the CBRE valuation (acting as external independent
valuers) as at 31 March 2016. Due to the significant uncertainties
surrounding the valuation assumptions, the Directors have assessed
a number of the risks and reduced all the three valuations to take
into account the present value of estimated future cash flows.
The investments are in projects for which there is very little
or no market comparable information. Consequently the valuations
are dependent on assumptions which are the subject of judgement,
and a large range of possible valuations can be deduced. Due to the
inherent uncertainty associated with the determination of the
valuations, the amount realised on disposal may differ materially
from the carrying amount in the financial statements. The impact of
such uncertainty cannot be quantified.
Investments are recorded at fair value are as follows:
2016 2015
GBP'000 GBP'000
Beginning of year 16,078 25,465
Disposals- fair value at beginning
of period - (7,692)
Fair value adjustment (7,806) (1,695)
--------- ---------
End of year 8,272 16,078
--------- ---------
The fair value adjustment consists of:
2016 2015
GBP'000 GBP'000
Change of investment values measured
in Indian Rupees (7,394) (2,970)
(Depreciation)/appreciation of Rupee
against Sterling (412) 1,275
--------- ---------
Fair value adjustment as above (7,806) (1,695)
Reversal of previously unrealised write-downs
of investments disposed during the
year (forming part of the realised
loss on disposals recorded) - 9,607
Fair value movement as in Statement
of Comprehensive Income (7,806) 7,912
--------- ---------
IFRS 13, Fair Value Measurement requires disclosure, by class of
financial instruments, if the effect of changing one or more inputs
to reasonably possible alternative assumptions would result in a
significant change to the fair value measurement. The information
used in determination of the fair value of Level 3 investment is
chosen with reference to the specific underlying circumstances and
position of the investee company. On that basis, the Board believe
that the impact of changing one or more of the inputs to reasonably
possible alternative assumptions would not change the fair value
significantly.
Fair value hierarchy of investments
The financial assets measured at fair value are valued using a
fair value hierarchy as described in Note 3.
12. Cash and cash equivalents
2016 2015 2016 2015
Group Group Company Company
GBP'000 GBP'000 GBP'000 GBP'000
Cash held with banks 367 1,109 338 942
Money market funds 5,289 5,272 5,219 5,204
-------- -------- -------- --------
5,656 6,381 5,557 6,146
======== ======== ======== ========
13. Provision for future legal costs
The Company is engaged in a dispute, as described in note 16,
with Immobilien Development Indien I GmbH & Co. KG ("Immobilien
I") and Immobilien Development Indien II GmbH & Co. KG
("Immobilien II"), being limited partnerships incorporated in
Germany, both sponsored by SachsenFonds Holding GmbH.
Trinity Capital Mauritius Limited, has initiated legal
proceedings in Mauritius against Trinity Capital (One) Limited, to
recover a loan of GBP7.5 million together with interest.
A provision of GBP2 million (2015: GBP2 million) has been
established since 2012 for the amount of the estimated legal costs
yet to be incurred in the Group's litigation processes.
There is no certainty as to the adequacy of this provision. The
actual amount of future legal costs may differ materially from the
GBP2 million provision, and will depend on various factors,
including the Company's ability to settle legal claims, the
duration and complexity of any litigation, and the efficiency of
the legal process in the jurisdiction where a claim might be
heard.
14. Share capital
The authorised share capital at 31 March 2016 and 31 March 2015
and the issued and fully paid share capital at the same dates were
as follows:
Authorised Issued and fully paid
No. of Shares GBP No. of Shares GBP
Ordinary shares of 1 pence each 416,750,000 4,167,500 210,432,498 2,104,325
Deferred shares of 1 pence each 250,000 2,500 250,000 2,500
417,000,000 4,170,000 210,682,498 2,106,825
============== ========== ============== ==========
The Deferred Shares rank pari passu with the Ordinary Shares
save that the Deferred Shares have no right to dividends or voting
rights or the right to receive notice of or attend any general
meeting. On the return of capital in a winding-up of the Company or
otherwise (other than re-purchases or redemptions of shares
authorised by special resolution), the Deferred Shares have the
right to return of par value paid up thereon in priority to the
return of the par value paid up on the Ordinary Shares.
Group capital comprises share capital and reserves.
Neither the Company nor any of its subsidiaries are subject to
externally imposed capital requirements.
15. Net asset value (NAV)
The NAV per Share is calculated by dividing the net assets
attributable to the equity holders of the Company at the end of the
year by the number of Shares in issue as at 31 March 2016.
2016 2015
Net assets (GBP'000) 11,617 18,586
Number of Shares in issue (note
14) 210,682,498 210,682,498
------------ ------------
NAV per Share (pence) 5.5 8.8
============ ============
16. Contingent Liabilities
On 12 January 2011 the Company received a notification of claim
from Immobilien I and Immobilien II. In addition to the Company,
the notification was addressed to TCML, Trikona Advisers Ltd.
("TAL", the former investment adviser of the Company,) private
persons who together controlled TAL, and TSF Advisers Mauritius
Limited (a joint venture between TAL and SachsenFonds Asset
Management GmbH). On 13 July 2011, the Supreme Court in Mauritius
set aside the claim lodged by Immobilien I and Immobilien II on
jurisdictional grounds. Immobilien I and Immobilien II appealed
against that decision on 26 July 2011, and the appeal was heard on
9 July 2015. The appeal court reserved its judgement and no
decision has yet been issued.
By way of background, in November 2007 and May 2008 Immobilien I
and Immobilien II purchased from TCML interests in various
Mauritian companies (the "TC Companies") which in turn owned equity
stakes in Indian investment vehicles (the "Indian Companies") which
held certain of the Company's development projects in India (the
"Transactions"). Accordingly, Immobilien I and/or Immobilien II
were partners with TCML in various Mauritian companies in respect
of five development projects in India. One Mauritian TC Company was
sold in its entirety to Immobilien I and Immobilien II. In
aggregate, Immobilien I and Immobilien II paid GBP86.4 million for
investments in which the Company had invested GBP41.8 million. The
contracts included provisions in the relevant documentation
relating to one investment whereby the Group would be obliged to
make good to the acquirer the economic loss which would arise upon
the non-fulfilment of certain conditions in the contractual
arrangements.
The amount claimed by Immobilien I and Immobilien II in the
original pleading was their original cost of the investments, being
nearly EUR116 million, plus amounts to compensate for prejudice,
trouble, annoyance, interest and costs.
The Board remains fully committed to defending the claims made
by Immobilien I and Immobilien II. The Directors do not consider it
necessary to provide for the claims in the financial
statements.
17. Commitments
There were no outstanding contractual commitments at the
year-end (2015: nil).
18. Financial risk management
The Group's activities expose it to a variety of financial
risks: market risk (including currency risk, market price risk and
interest rate risk), credit risk and liquidity risk.
Risk management is carried out by the Board, with assistance
from the Investment Manager to the extent possible and as
appropriate.
(a) Market risk
(i) Foreign exchange risk
The Group operates internationally and is exposed to foreign
exchange risk arising from various currency exposures, primarily
with respect to the Indian Rupee. Foreign exchange risk arises from
future commercial transactions, recognised monetary assets and
liabilities and net investments in foreign operations.
Net assets denominated in Indian Rupee at the year-end amounted
to GBP8.3 million (2015: GBP16.1 million).
At 31 March 2016, had the exchange rate between the Indian Rupee
and Sterling increased or decreased by 5% with all other variables
held constant, the increase or decrease respectively in net assets
would amount to approximately GBP0.4 million (2015: GBP0.8
million).
The Group does not hedge against foreign exchange movements.
(ii) Market price risk
The Group is exposed to market price risk arising from its
investments. All these securities present a risk of capital loss.
The Board and the Investment Manager are responsible for the
selection of investments and monitoring exposure to market risk.
All investments are in Indian companies.
If the value of the group's investment portfolio had increased
by 5%, the Group's net assets would have increased by GBP0.4
million (2015: GBP0.8 million). A decrease of 5% would have
resulted in equal and opposite decrease in net assets.
The Group is exposed to property price risk, property rentals
risk and the normal risks of property development through its
investment in Indian real estate companies.
(iii) Cash flow and fair value interest rate risk
The Group's cash and cash equivalents are invested at short term
market interest rates.
The table below summarises the Group's exposure to interest rate
risks. It includes the Groups' financial assets and liabilities at
the earlier of contractual re-pricing or maturity date, measured by
the carrying values of assets and liabilities.
Less than 1-3 3 months 1-5 years Over 5 Non- Total
1 month months to 1 year years interest
bearing
31 March 2016 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Financial assets
Investments at fair value through
profit or loss - - - - - 8,272 8,272
Trade and other receivables - - - - - 1 1
Cash and cash equivalents 5,656 - - - - - 5,656
Prepayments - - - - - 30 30
---------- --------- ----------- ----------- -------- ---------- --------
Total financial assets 5,656 - - - - 8,303 13,959
---------- --------- ----------- ----------- -------- ---------- --------
Financial liabilities
Provision for legal costs - - - - - 2,000 2,000
Trade and other payables - - - - - 342 342
Total financial liabilities - - - - - 2,342 2,342
---------- --------- ----------- ----------- -------- ---------- --------
Total interest rate sensitivity gap 5,656 - - - - - -
---------- --------- ----------- ----------- -------- ---------- --------
Less than 1 month 1-3 3 mths 1-5 years Over 5 Non- Total
months to 1 year years interest
bearing
31 March 2015 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Financial assets
Investments at fair value
through profit or loss - - - - - 16,078 16,078
Trade and other receivables - - - - - 3 3
Cash and cash equivalents 6,381 - - - - - 6,381
Prepayments - - - - - 13 13
------------------ --------- ----------- ----------- -------- ---------- --------
Total financial assets 6,381 - - - - 16,094 22,475
------------------ --------- ----------- ----------- -------- ---------- --------
Financial liabilities
Provision for legal costs - - - - - 2,000 2,000
Trade and other payables - - - - - 345 345
Total financial liabilities - - - - - 2,345 2,345
------------------ --------- ----------- ----------- -------- ---------- --------
Total interest rate 6,381 - - - - - -
sensitivity gap
------------------ --------- ----------- ----------- -------- ---------- --------
(b) Credit risk
Credit risk arises on investments, cash balances and debtor
balances. The amount of credit risk is equal to the amounts stated
in the statement of financial position for each of these assets.
Cash balances are limited to high-credit-quality financial
institutions. There are no impairment provisions as at 31 March
2016 (2015: nil).
(c) Liquidity risk
Prudent liquidity risk management implies maintaining sufficient
cash and marketable securities, the availability of funding through
an adequate amount of committed credit facilities and the ability
to close out market positions. The Company aims to maintain
flexibility in funding.
Residual undiscounted contractual maturities of financial
liabilities:
31 March 2016 Less 1-3 3 months 1-5 Over No stated
than months to 1 years 5 maturity
1 month year Years
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Financial liabilities
Provision for
legal costs - - - - - 2,000
Trade and other 342 - - - - -
payables
342 - - - - 2,000
--------- -------- --------- -------- -------- ----------
31 March 2015 Less 1-3 3 months 1-5 Over No stated
than months to 1 years 5 maturity
1 month year Years
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Financial liabilities
Provision for
legal costs - - - - - 2,000
Trade and other 345 - - - - -
payables
345 - - - - 2,000
--------- -------- --------- -------- -------- ----------
19. Related party transactions
Graham Smith is a Director of the Company, and a Director of the
Administrator. He has received no Directors' fees from the Company
during the year (2015: nil). The fees paid by the Company to the
Administrator (excluding VAT) for the year amounted to GBP0.1
million (2015: GBP0.1 million).
Details of other Directors' remuneration during the year are
given in note 6.
20. Subsequent events
On the date of this Report, the Company announced a distribution
to shareholders of GBP2.1 million (1.0p per share), payable on 23
September 2016 to shareholders on the register as at 2 September
2016. The shares will be marked "ex" on 1 September 2016.
There were no other significant subsequent events.
Company Information
Registered Office
IOMA House
Hope Street
Douglas
Isle of Man
IM1 1AP
Incorporated in the Isle of Man. Company No. 115806C
Directors
Martin Adams (Chairman)
John Chapman
Stephen Coe
Graham Smith
Pradeep Verma
Company Secretary
Philip Scales
Administrator and Registrar
FIM Capital Limited
IOMA House
Hope Street
Douglas
Isle of Man
IM1 1AP
Auditors
KPMG Audit LLC
Heritage Court
41 Athol Street
Douglas
Isle of Man
IM99 1HN
Investment Manager
Indiareit Investment Management Company
IFS Court
28 Cybercity
Ebene
Mauritius
Valuer
CBRE
Henrietta House
Henrietta Place
London
W1G 0NB
Nominated Adviser (NOMAD) and Broker
Arden Partners plc
125 Old Broad Street
London
EC2N 1AR
Website www.trinitycapitalplc.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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