Nigerian Aviation Handling Company PLC

Transcription

1 Nigerian Aviation Handling PLC Financial Statements -- Q1 2018

2 Nigerian Aviation Handling PLC Consolidated Statement of Comprehensive Income 1 Consolidated Statement of Financial Position 2 Statement of Changes in Equity 3 Consolidated Statement of Cashflow 4 Notes to the Consolidated Financial Statements 5-38

3 Nigerian Aviation Handling PLC Consolidated and Seperate Financial Statements - 31 March 2018 Consolidated and Separate Statement of Comprehensive Income Notes Mar 2018 Mar 2017 Mar 2018 Mar 2017 N 000 N 000 N 000 N 000 Revenue 5 2,188,674 1,786,155 2,082,054 1,735,602 Operating costs 9a (1,419,942) (1,312,873) (1,397,743) (1,349,963) Gross Profit 768, , , ,639 Other Income 6 70,262 90,877 66,679 65,000 Selling & Administrative expenses 9b (741,547) (538,333) (698,551) (456,353) Profit from operations 97,446 25,825 52,439 (5,714) Finance Income 7 64,495 30,916 80,268 53,932 Finance costs 7 (44,536) (55,715) (44,536) (55,715) Profit before tax 117,405 1,026 88,171 (7,497) Income tax expense 8(a) (19,838) - (19,838) - Profit after tax 97,566 1,026 68,332 (7,497) Other comprehensive income - - Total comprehensive income 97,566 1,026 68,332 (7,497) Attributable to: Profit attributable to owners of the company 97,277 2,418 Non-controlling interest 9(a) 289 (1,392) - 97,566 1,026 68,332 (7,497) Earnings per share Basic earnings per share ( Kobo) Diluted earnings per share ( Kobo)

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5 Nigerian Aviation Handling PLC Consolidated and Separate Statement of changes in Equity Attributable to equity holders of the Share Capital Share Premium Retained Earnings Total Noncontrolling Interest Total Equity N'000 N'000 As at 1 January ,109 1,914,758 4,171,551 6,898,418 (127,646) 6,770,772 Comprehensive income for the period Profit / (Loss) for the period ,277 97, ,566 Other comprehensive income Total comprehensive income for the period ,277 97, ,566 Transaction with owners recognised directly in equity Dividend paid to owners Total transactions with owners of the As at 31 March ,109 1,914,758 4,268,828 6,995,695 (127,357) 6,868,338 Attributable to equity holders of the Share Capital Share Premium Retained Earnings Total Noncontrolling Interest Total Equity N'000 N'000 Balance at 01 January ,109 1,914, ,817 6,475,684 (123,350) 6,352,334 Comprehensive income for the period Profit / (Loss) for the period - - 2,418 2,418 (1,392) 1,026 Other comprehensive income Total comprehensive income for the period - - 2,418 2,418 (1,392) 1,026 Transaction with owners recognised directly in equity Dividend to owners Total transactions with owners of the As at 31 March ,109 1,914,758 3,751,235 6,478,102 (124,742) 6,353,360 3

6 Nigerian Aviation Handling PLC Consolidated and Separate Statement of Cash Flows Notes Mar 2018 Mar 2017 Mar 2018 Mar 2017 N 000 N 000 N 000 N 000 Cash Flows from Operating Activities Profit / (Loss) for the year 97,446 30,124 52,439 (5,714) Adjustments for non-cash income and expense: Income tax expense Depreciation: PPE , , , ,412 Depreciation: Investment property 14 1, , Amortisation of intangible asset 13 7,528 8,983 7,528 8,983 Impairment (gain) to trade receivables Derecognised Investment Property Loss/(gain )on disposal of PPE - (3,505) - (3,505) Adjustments/ Library stock written off - - Adjustments: Adjustments/ Library stock written off , , , ,973 Changes in operating assets and liabilities: (Increase)/Decrease in inventories 19 4,267 5,032 4,267 5,032 (Increase)/Decrease in trade and other receivables 21 (318,085) (231,917) (190,607) (226,824) (Increase)/Decrease in prepayments 20 (527,360) (416,923) (486,061) (403,198) (Decrease)/increase in trade and other payables , , , ,305 (Decrease)/increase in deferred revenue 31 12,703 (69,971) (25,038) (25,940) (377,687) (577,356) (287,719) (513,626) Cash generated from operations (90,013) (337,118) (85,147) (348,653) Taxation paid 8(b) (645) - (0) (0) Net cash inflow provided by operating activities (90,658) (337,118) (85,147) (348,653) Cash Flows from Investing Activities - Acquisition of property, plant and equipment 12 (47,854) (15,787) (47,848) (12,836) Proceeds from disposal of property, plant and equipment - 13,282-13,282 Deposit for Shares Acquisition of intangible assets 13 - (977) - (977) Restated Balance - - Acquisition of Investment properties (3,856) - (3,856) - Derecognition of Accumulated Depreciation Bond repayment fund 18 (246,545) (166,942) (246,545) (166,942) Non-Controlling Interests Loan granted - 13,378 1,264 Interest received 7 64,495 30,916 80,268 53,932 Increase in investment in Subsidiary Net cash used in investing activities (233,760) (139,507) (204,603) (112,276) Cash flows from financing activities Loans and borrowing restated at amortised cost Intercompany ,777 64,624 Interest paid on Bond 7 (44,536) (60,014) (44,536) (55,715) Loan and borrowings Dividends paid Net cash outflow from financing activities (44,536) (60,014) (17,759) 8,909 Net increase in cash and cash equivalents (368,954) (536,639) (307,509) (452,020) Cash at bank and in hand, beginning of year 2,571,407 2,930,747 2,436,564 2,663,797 Effect of exchange rate fluctuations on cash held Cash at bank and in hand, end of Period 2,202,453 2,394,107 2,129,054 2,211,779 Cash and Cash Equivalents This comprises: - - Cash at bank and in hand 530,423 2,004, ,998 1,854,175 Fixed deposit 1,435, ,704 1,435, ,604 Treasury Bills 236, , , ,000 2,202,453 2,394,107 2,129,054 2,211,779 4

7 Nigerian Aviation Handling PLC Notes to the consolidated and separate financial statements 1. Reporting entity Nigerian Aviation Handling PLC ("nahco aviance" or "the ") is a company domiciled in Nigeria with its registered office at Murtala Muhammed International Airport, Ikeja, Lagos. The consolidated financial statements of the for the period ended 31 March 2018 comprise the and its subsidiaries (together referred to as the "" and individually as " entities"). The is primarily involved in provision of services including aircraft handling, cargo handling, passenger handling, passenger profiling, crew transportation, energy and power distribution and leasing of ground handling equipment. 2. Basis of preparation (a) Statement of compliance The financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). (b) Functional and presentation currency These financial statements are presented in Nigerian Naira, which is the Parent's functional currency. Except as indicated, financial information presented in Naira has been rounded to the nearest thousand. (c) Basis of measurement These financial statements are prepared on the historical cost basis. (d) The financial statements were authorised for issue by the directors on 30th April, Use of estimates and judgements The preparation of financial statements in conformity with IFRSs requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. The 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, if the revision affects only that period, or in the period of the revision and future periods, if the revision affects both current and future periods. 5

8 Nigerian Aviation Handling PLC Notes to the consolidated and separate financial statements Judgements In the process of applying the s accounting policies, management has made the following judgements, which have the most significant effect on the amounts reecognised in the financial statements. Operating lease commitments as lessor The has entered into commercial property leases on its investment property portfolio. The has determined, based on an evaluation of the terms and conditions of the arrangements, such as the lease term not constituting a major part of the economic life of the commercial property and the present value of the minimum lease payments not amounting to substantially all of the fair value of the commercial property, that it retains all the significant risks and rewards of ownership of these properties and accounts for the contracts as operating leases. Going concern The s management has made an assessment of its ability to continue as a going concern and is satisfied that it has the resources to continue in business for the foreseeable future. Furthermore, management is not aware of any material uncertainties that may cast significant doubt upon the s ability to continue as a going concern. Therefore, the financial statements continue to be prepared on the going concern basis. Estimates and assumptions The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are described below. The based its assumptions and estimates on parameters available when the financial statements were prepared. Existing circumstances and assumptions about future developments, however, may change due to market changes or circumstances arising beyond the control of the. Such changes are reflected in the assumptions when they occur. Re-assessment of useful lives and residual values The carries its PPE at cost in the consolidated and separate statements of financial position. The annual review of the useful lives and residual value of PPE result in the use of significant management judgements. Accounts receivable The allowance for doubtful accounts involves management judgment and review of individual receivable balances based on an individual customer s prior payment record, current economic trends and analysis of historical bad debts of a similar type. Impairment of non-financial assets 6

9 Nigerian Aviation Handling PLC Notes to the consolidated and separate financial statements Impairment exists when the carrying value of an asset or cash generating unit exceeds its recoverable amount, which is the higher of its fair value less costs to sell and its value in use. The fair value less costs to sell calculation is based on available data from binding sales transactions, conducted at arm s length for similar assets or observable market prices less incremental costs for disposing of the asset. The value in use calculation is based on a discounted cash flow model. The cash flows are derived from the budget for the next five years and do not include restructuring activities that the is not yet committed to or significant future investments that will enhance the asset s performance of the CGU being tested. The recoverable amount is most sensitive to the discount rate used for the discounted cash flow model as well as the expected future cash inflows and the growth rate used for extrapolation purposes. Fair value of financial instruments When the fair value of financial assets and financial liabilities recorded in the consolidated and separate statements of financial position cannot be derived from active markets, their fair value is determined using valuation techniques including the discounted cash flow model. The inputs to these models are taken from observable markets where possible, but where this is not feasible, a degree of judgement is required in establishing fair values. The judgements include considerations of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions about these factors could affect the reported fair value of financial instruments. Taxes Uncertainties exist with respect to the interpretation of complex tax regulations, changes in tax laws, the amount and timing of future taxable income. Given the wide range of international business relationships and the long-term nature and complexity of existing contractual agreements, differences arising between the actual results and the assumptions made, or future changes to such assumptions, could necessitate future adjustments to tax income and expense already recorded. The establishes provisions, based on reasonable estimates, for possible consequences of audits by the tax authorities. 7

10 Nigerian Aviation Handling PLC Notes to the consolidated and separate financial statements 3. Significant accounting policies The accounting policies set out below have been applied consistently to all periods presented in these financial statements. (a) Basis of Consolidation The consolidated financial statements comprise the financial statements of the and its subsidiaries as at 31 December Control is achieved when the is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee. Specifically, the controls an investee if, and only if, the has: Power over the investee (i.e., existing rights that give it the current ability to direct the relevant activities of the investee) Exposure, or rights, to variable returns from its involvement with the investee The ability to use its power over the investee to affect its returns Generally, there is a presumption that a majority of voting rights results in control. To support this presumption and when the has less than a majority of the voting or similar rights of an investee, the considers all relevant facts and circumstances in assessing whether it has power over an investee, including: The contractual arrangement(s) with the other vote holders of the investee Rights arising from other contractual arrangements The s voting rights and potential voting rights The re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the obtains control over the subsidiary and ceases when the loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the gains control until the date the ceases to control the subsidiary. Profit or loss and each component of Other Comprehensive Income (OCI) are attributed to the equity holders of the parent of the and to the non-controlling interests, even if this results in the non-controlling interests having a deficit balance. When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with the s accounting policies. All intra-group assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the are eliminated in full on consolidation. A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction. If the loses control over a subsidiary, it derecognises the related assets (including goodwill), liabilities, noncontrolling interest and other components of equity, while any resultant gain or loss is recognised in profit or loss. Any investment retained is recognised at fair value. (b) Foreign currrency transactions 8

11 Nigerian Aviation Handling PLC Notes to the consolidated and separate financial statements (c) Transactions in foreign currencies are translated into the respective functional currencies of entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at each reporting date are re-translated to the functional currency at exchange rates as 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 the functional currency translated at the exchange rate at the end of the year. Differences arising on settlement or translation of monetary items are recognised in profit or loss. Property, plant and equipment Recognition and measurement Items of property, plant and equipment are carried at cost less accumulated depreciation and impairment losses. Cost includes expenditures that are directly attributable to the acquisition of the asset. The attributable cost of each asset is transferred to the relevant asset category immediately the asset is available for use and depreciated accordingly. When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. Purchased software that is integral to the functionality of the related equipment is capitalised as part of the equipment. Any gain or loss on disposal of an item of property, plant and equipment (calculated as the difference between the net proceeds from disposal and the carrying amount of the item) is recognised in profit and loss. Subsequent costs The cost of replacing part of an item of property or plant is recognised in the carrying amount of the item if it is probable that future economic benefits embodied within the part will flow to the and its cost can be measured reliably. The carrying amount of the replaced component is derecognised. The costs of the day-to-day servicing of property and equipment are recognised in profit or loss as incurred. 9

12 Nigerian Aviation Handling PLC Notes to the consolidated and separate financial statements Derecognition of intangible assets An intangible asset is derecognised on disposal, or when no future economic benefits are expected from use or disposal. Gains or losses arising from derecognition of an intangible asset, measured as the difference between the net disposal proceeds and the carrying amount of the asset are recognised in profit or loss when the asset is derecognised. Amortisation methods, useful lives and residual values are reviewed at each financial year-end and adjusted if appropriate. (e) Inventories Inventories are shown at the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. The cost includes direct cost and appropriate overheads and is determined on the first-in first-out method. (f) Financial Instruments (i) Financial assets Initial recognition and measurement Financial assets are classified into loans and receivables. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace. All financial assets are recognised initially at fair value. Subsequent measurement For purposes of subsequent measurement, financial assets are classified as follows; Loans and receivables Loans and receivables This category is the most relevant to the. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. After initial measurement, such financial assets are subsequently measured at amortised cost using the Effective Interest Rate method (EIR), less impairment. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The Effective Interest Rate amortisation is included in finance income in the statement of profit or loss. The losses arising from impairment are recognised in the statement of profit or loss in finance costs for loans and in cost of sales or other operating expenses for receivables. Trade and other receivables Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost, less allowance for impairment. The carrying amount of trade receivable is reduced through the use of an allowance account. When trade receivables are uncollectible, it is written off as administrative expenses in profit or loss. Subsequent recoveries of amounts previously written off are included in other operating income. Cash and cash equivalents Cash and cash equivalents comprise of cash, bank balances and call deposits with original maturities of three months or less. De-recognition A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is primarily derecognised (i.e., removed from the s consolidated statement of financial position) when: The rights to receive cash flows from the asset have expired; Or The has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a pass-through arrangement; and either (a) the has transferred substantially all the risks and rewards of the asset, or (b) the has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset 10

13 Nigerian Aviation Handling PLC Notes to the consolidated and separate financial statements When the has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the continues to recognise the transferred asset to the extent of its continuing involvement. In that case, the also recognises an associated liability. The transferred asset and the associated liability are measured on a basis that reflects the rights and obligations that the has retained. Continuing involvement that takes the form of a guarantee over the transferred asset is measured at the lower of the original carrying amount of the asset and the maximum amount of consideration that the could be required to repay. (ii) Financial liabilities Initial recognition and measurement Financial liabilities are classified, at initial recognition, as loans and borrowings or payables, as appropriate. All financial liabilities are recognised initially at fair value and, in the case of loans and borrowings and payables, net of directly attributable transaction costs. The s financial liabilities include trade and other payables, loans and borrowings including bank overdrafts. Subsequent measurement The measurement of financial liabilities depends on their classification, as described below: Loans and borrowings This is the category most relevant to the. After initial recognition, interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in the statement of profit or loss. Trade and other payables Trade and other payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Trade and other payables are classified as current liabilities if payment is due within one year (or in the normal operating cycle of the business, if longer). If not, they are presented as non-current liabilities. Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. De-recognition A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss. iii) Off- setting of financial instruments Financial assets and financial liabilities are offset and the net amount is reported in the consolidated statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously 11

14 Notes to the consolidated and separate financial statements Nigerian Aviation Handling PLC Depreciation Depreciation is recognised in profit or loss on a straight-line basis to write down the cost of each asset, to their residual values over the estimated useful lives of each part of an item of property and equipment. Leased assets under finance lease are depreciated over the shorter of the lease term and their useful lives. Items of property, plant and equipment are depreciated from the date that they are installed and are ready for use, or in respect of internally constructed assets, from the date the asset is completed and available for use. Depreciation ceases at the earlier of the date that the asset is derecognised or classified as held for sale in accordance with IFRS 5. A noncurrent asset or disposal group is not depreciated while it is classified as held for sale. The estimated useful lives for the current and comparative period are as follows: Buildings Land Computer hardware Furniture, fittings & equipment Motor vehicles Plant and machinery Capital work-in-progress 50 years Over the lease period 3-10 years 2-10 years 4 years 5-15 years Not depreciated Depreciation methods, useful lives and residual values are reviewed at each financial year- end and adjusted if appropriate. De-recognition An item of property and equipment is derecognised on disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the (asset) is included in profit or loss in the year the asset is derecognised. (d) Intangible assets The 's intangible assets comprise softwares that are not integral part of the related hardware. The intangible assets have finite useful lives and are measured at cost less accumulated amortisation and accumulated impairment losses. Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is recognised in profit or loss as incurred. Intangible assets acquired separately Intangible assets with finite useful lives that are acquired separately are carried at cost less accumulated amortisation and accumulated impairment losses. Amortisation is recognised on a straight-line basis over their estimated useful lives. The estimated useful life and amortisation method are reviewed at the end of each annual reporting period, with the effect of any changes in estimate being accounted for on a prospective basis. Intangible assets with indefinite useful lives that are acquired separately are carried at cost less accumulated impairment losses. 12

15 Nigerian Aviation Handling PLC Notes to the consolidated and separate financial statements (g) Share Capital Ordinary Shares Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares and share options are recognised as deductions from equity, net of any tax effects. Dividend on ordinary shares Dividends on the s ordinary shares are recognised in equity in the period in which they are paid or, if earlier, approved by the s shareholders. (h) Taxation Income tax on the profit or loss for the year comprises current tax. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted at the statement of financial position date date and any adjustment required Deferred tax is recognised in respect of temporary differences arising between the tax bases of assets and liabilities and their carrying values for financial reporting purposes. Deferred tax is not recognised for the 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. Currently enacted tax rates are used to determine deferred tax. Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilised. (i) Impairment Financial assets A financial asset not carried at fair value through profit or loss is assessed at each reporting date to determine whether there is any objective evidence that it is impaired. A financial asset is considered impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future cash flows of the asset. An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount, and the present value of the estimated future cash flows discounted at the original effective interest rate. Individually significant financial assets are tested for impairment on an individual basis. The remaining financial assets are assessed collectively in groups that share similar credit risk characteristics. All impairment losses are recognised in profit or loss. Non-financial assets The carrying amounts of the 's non-financial assets, other than inventories, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset's recoverable amount is estimated. The recoverable amount of an asset is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of the time value of money and the risks specific to the asset. An impairment loss is recognised if the carrying amount of an asset exceeds its estimated recoverable amount. Impairment losses are recognised in profit or loss. Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine its recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. 13

16 Nigerian Aviation Handling PLC Notes to the consolidated and separate financial statements (j) Non-current assets held for sale Non-current assets (or disposal groups comprising assets and liabilities) that are expected to be recovered primarily through sale rather than through continuing use are classified as held for sale. Immediately before classification as held for sale, the assets (or components of a disposal group) are measured in accordance with the 's accounting policies. Thereafter, the assets (or disposal group) are measured at the lower of their carrying amount and fair value less cost to sell. Impairment losses on initial classification as held for sale and subsequent gains or losses on remeasurement are recognised in profit or loss. Gains are not recognised in excess of any cumulative impairment loss. (k) Employee benefits Defined contribution plans A defined contribution plan is a post employment benefit plan under which an entity pays fixed contribution into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution pension plans are recognised as an employee benefit expense in profit or loss when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available. Short-term benefits Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid under short-term cash bonus plans if the has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably. (l) Provisions A provision is recognised if, as a result of a past event, the has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. 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. When some or all of the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the amount of the receivable can be measured reliably. (m) Revenue recognition Services Revenue from services rendered is recognised in profit and loss in proportion to the stage of completion of the transaction at the reporting date. The stage of completion is assessed by reference to services performed to date as a percentage of total services to be performed. The is involved in aviation cargo, aircraft handling, crew and passenger transportation service delivery and power distribution. When the services under a single arrangement are rendered in different reporting periods, the consideration is allocated on a relative fair value basis between the services. Rental income Rental income from investment property is recognised as revenue on a straight line basis over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income, over the term of the lease. Rental income from other property is recognised as other income. 14

17 Notes to the consolidated and separate financial statements Nigerian Aviation Handling PLC (n) Finance income and expense Finance income comprise of interest on funds invested. Finance costs comprise interest expense on borrowings, exchange differences on financial instruments and bank charges. Borrowing costs that are not directly attributable to the acquisition, construction or production of a qualifying asset are recognised in the profit and loss using the effective interest method. Foreign currency gains and losses are reported on a net basis as either finance income or finance cost depending on whether foreign currency movements are in a net gain or net loss position except for foreign currency translation differences recorded in other comprehensive income. (o) Leased assets Leases in term of which the assumes substantially all the risks and rewards of ownership are classified as finance leases. Upon initial recognition, the leased asset is measured at an amount equal to the lower of its fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset. (p) Lease Payments Payments made under operating leases are recognised in profit and loss on a straight-line basis over the term of the lease. Minimum lease payments made under finance leases are apportioned between the finance expense and the reduction of the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability. Determining whether an arrangement contains a lease At inception of an arrangement, the determines whether such an arrangement is or contains a lease. A specific asset is the subject to a lease if fulfilment of the arrangement is dependent on the use of that specified asset. An arrangement conveys the right to use the asset if the arrangement conveys to the the right to control the use of the underlying asset. At inception or upon reassessment of the arrangement, the separates payments and other considerations required by such an arrangement into those for other elements on the basis of their relative fair values, If the concludes for a finance lease that it is impracticable to separate the payments reliably, then an asset and a liability are recognised at an amount equal to the fair value of the underlying asset. Subsequently the liability is reduced as payments are made and an imputed finance charge on the liability is recognised on a straight line. (q) Investment property Investment property is property held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of business, use in the production of goods and services or for administrative purposes. Investment property is measured at cost less accumulated depreciation and impairment loss. Cost includes expenditure that is directly attributable to the acquisiton of the investment property. Investment property held by the is depreciated over the estimated useful life of 50 years. Fair values are determined at the end of the reporting period and disclosed. 15

18 Notes to the consolidated and separate financial statements For the quarter ended 31- March, 2018 Nigerian Aviation Handling PLC (r) (s) Earnings per share The presents basic earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the by the Fair value measurement The measures financial instruments such as derivatives, and non-financial assets such as Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement In the principal market for the asset or liability; Or In the absence of a principal market, in the most advantageous market for the asset or liability The principal or the most advantageous market must be accessible by the. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant's ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: Level 1 Quoted (unadjusted) market prices in active markets for identical assets or liabilities Level 2 Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable Level 3 Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable for assets and liabilities that are recognised in the financial statements at fair value on a recurring basis. the determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period (t) Current versus non-current classification The presents assets and liabilities in the statement of financial position based on current/non-current classification. An asset is current when it is: Expected to be realised or intended to be sold or consumed in the normal operating cycle Held primarily for the purpose of trading Expected to be realised within twelve months after the reporting period; Or Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least twelve m All other assets are classified as non-current. 16

19 Notes to the consolidated and separate financial statements For the quarter ended 31- March, 2018 Nigerian Aviation Handling PLC A liability is current when: It is expected to be settled in the normal operating cycle It is held primarily for the purpose of trading It is due to be settled within twelve months after the reporting period; Or There is no unconditional right to defer the settlement of the liability for at least twelve months after the report The classifies all other liabilities as non-current. Deferred tax assets and liabilities are classified as non-current assets and liabilitie 4a. New and amended standards and interpretations The applied for the first time certain standards and amendments, which are effective for annual periods beginning on or after 1 January The has not early adopted any other standard, interpretation or amendment that has been issued but is not yet effective. The nature and the effect of these changes are disclosed below. Although these new standards and amendments applied for the first time in 2017, they did not have a material impact on the annual consolidated financial statements of the. The nature and the impact of each new standard or amendment is described below: IFRS 14 Regulatory Deferral Accounts IFRS 14 is an optional standard that allows an entity, whose activities are subject to rate-regulation, to continue applying most of its existing accounting policies for regulatory deferral account balances upon its first-time adoption of IFRS. Entities that adopt IFRS 14 must present the regulatory deferral accounts as separate line items on the statement of financial position and present movements in these account balances as separate line items in the statement of profit or loss and OCI. The standard requires disclosure of the nature of, and risks associated with, the entity s rate-regulation and the effects of that rate-regulation on its financial statements. Since the is an existing IFRS preparer and is not involved in any rate-regulated activities, this standard does not apply. Amendments to IFRS 11 Joint Arrangements: Accounting for Acquisitions of I The amendments to IFRS 11 require that a joint operator accounting for the acquisition of an interest in a joint operation, in which the activity of the joint operation constitutes a business, must apply the relevant IFRS 3 Business Combinations principles for business combination accounting. The amendments also clarify that a previously held interest in a joint operation is not remeasured on the acquisition of an additional interest in the same joint operation if joint control is retained. In addition, a scope exclusion has been added to IFRS 11 to specify that the amendments do not apply when the parties sharing joint control, including the reporting entity, are under common control of the same ultimate controlling party. The amendments apply to both the acquisition of the initial interest in a joint operation and the acquisition of any additional interests in the same joint operation and are applied prospectively. These amendments do not have any impact on the as there has been no interest acquired in a joint operation during the period. 17

20 Notes to the consolidated and separate financial statements For the quarter ended 31- March, 2018 Nigerian Aviation Handling PLC Amendments to IAS 16 and IAS 38: Clarification of Acceptable Methods of Depreciation and Amortisation The amendments clarify the principle in IAS 16 Property, Plant and Equipment and IAS 38 Intangible Assets that revenue reflects a pattern of economic benefits that are generated from operating a business (of which the asset is a part) rather than the economic benefits that are consumed through use of the asset. As a result, a revenue-based method cannot be used to depreciate property, plant and equipment and may only be used in very limited circumstances to amortise intangible assets. The amendments are applied prospectively and do not have any impact on the, given that it has not used a revenue-based method to depreciate its noncurrent assets. Amendments to IAS 16 and IAS 41 Agriculture: Bearer Plants The amendments change the accounting requirements for biological assets that meet the definition of bearer plants. Under the amendments, biological assets that meet the definition of bearer plants will no longer be within the scope of IAS 41 Agriculture. Instead, IAS 16 will apply. After initial recognition, bearer plants will be measured under IAS 16 at accumulated cost (before maturity) and using either the cost model or revaluation model (after maturity). The amendments also require that produce that grows on bearer plants will remain in the scope of IAS 41 measured at fair value less costs to sell. For government grants related to bearer plants, IAS 20 Accounting for Government Grants and Disclosure of Government Assistance will apply. The amendments are applied retrospectively and do not have any impact on the as it does not have any bearer plants. Amendments to IAS 27: Equity Method in Separate Financial Statements The amendments allow entities to use the equity method to account for investments in subsidiaries, joint ventures and associates in their separate financial statements. Entities already applying IFRS and electing to change to the equity method in their separate financial statements have to apply that change retrospectively. These amendments do not have any impact on the s consolidated financial statements. Annual Improvements Cycle These improvements include: IFRS 5 Non-current Assets Held for Sale and Discontinued Operations Assets (or disposal groups) are generally disposed of either through sale or distribution to the owners. The amendment clarifies that changing from one of these disposal methods to the other would not be considered a new plan of disposal, rather it is a continuation of the original plan. There is, therefore, no interruption of the application of the requirements in IFRS 5. This amendment is applied prospectively. IFRS 7 Financial Instruments: Disclosures (i) Servicing contracts The amendment clarifies that a servicing contract that includes a fee can constitute continuing involvement in a financial asset. An entity must assess the nature of the fee and the arrangement against the guidance for continuing involvement in IFRS 7 in order to assess whether the disclosures are required. The assessment of which servicing contracts constitute continuing involvement must be done retrospectively. However, the required disclosures need not be provided for any period beginning before the annual period in which the entity first applies the amendments. 18

21 Notes to the consolidated and separate financial statements For the quarter ended 31- March, 2018 Nigerian Aviation Handling PLC (ii) Applicability of the amendments to IFRS 7 to condensed interim financial statements The amendment clarifies that the offsetting disclosure requirements do not apply to condensed interim financial statements, unless such disclosures provide a significant update to the information reported in the most recent annual report. This amendment is applied retrospectively. IAS 19 Employee Benefits The amendment clarifies that market depth of high quality corporate bonds is assessed based on the currency in which the obligation is denominated, rather than the country where the obligation is located. When there is no deep market for high quality corporate bonds in that currency, government bond rates must be used. This amendment is applied prospectively. IAS 34 Interim Financial Reporting The amendment clarifies that the required interim disclosures must either be in the interim financial statements or incorporated by cross-reference between the interim financial statements and wherever they are included within the interim financial report (e.g., in the management commentary or risk report). The other information within the interim financial report must be available to users on the same terms as the interim financial statements and at the same time. This amendment is applied retrospectively. These amendments do not have any impact on the. Amendments to IAS 1 Disclosure Initiative The amendments to IAS 1 clarify, rather than significantly change, existing IAS 1 requirements. The amendments clarify: The materiality requirements in IAS 1 That specific line items in the statement(s) of profit or loss and OCI and the statement of financial position may be disaggregated That entities have flexibility as to the order in which they present the notes to financial statements That the share of OCI of associates and joint ventures accounted for using the equity method must be presented in aggregate as a single line item, and classified between those items that will or will not be subsequently reclassified to profit or loss. Furthermore, the amendments clarify the requirements that apply when additional subtotals are presented in the statement of financial position and the statement(s) of profit or loss and OCI. These amendments do not have any impact on the. Amendments to IFRS 10, IFRS 12 and IAS 28 Investment Entities: Applying the Consolidation Exception The amendments address issues that have arisen in applying the investment entities exception under IFRS 10 Consolidated Financial Statements. The amendments to IFRS 10 clarify that the exemption from presenting consolidated financial statements applies to a parent entity that is a subsidiary of an investment entity, when the investment entity measures all of its subsidiaries at fair value. Furthermore, the amendments to IFRS 10 clarify that only a subsidiary of an investment entity that is not an investment entity itself and that provides support services to the investment entity is consolidated. All other subsidiaries of an investment entity are measured at fair value. The amendments to IAS 28 Investments in Associates and Joint Ventures allow the investor, when applying the equity method, to retain the fair value measurement applied by the investment entity associate or joint venture to its interests in subsidiaries. 19