UNIC DIVERSIFIED HOLDINGS PLC Lagos, Nigeria UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS AS AT 31 DECEMBER 2017

Transcription

1 UNIC DIVERSIFIED HOLDINGS PLC Lagos, Nigeria UNAUDITED CONSOLIDATED AND SEPARATE FINANCIAL STATEMENTS AS AT 31 DECEMBER 2017

2 UNIC DIVERSIFIED HOLDINGS PLC Unic Diversified Holdings Plc is a new company that was incorporated in September 11, 2015 by the shareholder of the former Unic Insurance Plc (now Unic Insurance Ltd after being delisted) through restructuring of Unic Insurance Group. The restructuring arrangement involves the shareholders of the former Unic Insurance Plc becoming the shareholders of Unic Diversified Holdings Plc which will hold minority interest in Unic Insurance Ltd by divesting the majority interest in Unic Insurance Ltd to a third party investor. Unic Diversified Holdings Plc is presently holding the whole of Unic Insurance Limited starting from 31 Dec All necessary approvals in satisfaction of all necessary statutes have been applied for and received. Presently, all arrangements to transfer agreed assets and liabilities from Unic Insurance Ltd to this company are in progress and will be concluded soon. The principal activities of the company are to carry on finance holding company and to invest and hold shares in blue chip companies but the company is not in full operations yet till when all arrangements are concluded.

3 UNIC DIVERSIFIED HOLDINGS PLC CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2017 Group Company Assets Notes =N='000 =N='000 =N='000 =N='000 Non current assets Property, plant and equipment 1 1,784,080 1,852, Investment properties 2 639, , Investments in subsidiaries ,169,203 2,169,203 Investment in Associates Other financial assets 4 1,140,889 1,181, Statutory deposits 5 219, , Intangible assets 6 1,741,638 1,741, Deferred tax assets Total non current assets 5,526,032 5,634,491 2,169,203 2,169,203 Current assets Inventory 7 2,986 3, Trade receivables 8 105, , Other receivables and prepayments 9 339, , Cash and cash equivalents 10 48,693 45, Total Current assets 496, , Total assets 6,022,707 6,085,672 2,169,453 2,169,303 Non current liabilities Interest bearing borrowings , , Retirement benefit obligations 12 13,337 12, Other payables 13(i) 2,224,110 2,090,177 Deferred tax liabilities , , Total non current liabilities 2,825,571 2,600, Current liabilities Trade payables , , Other payables 13 (ii) 774, , Interest bearing borrowings 11 2,323 11, Current Income tax payable , , Total current liabilities 1,325,287 1,316, Total liabilities 4,150,858 3,916, Net assets 1,871,848 2,169,204 2,169,203 2,169,203 Equity Issued share capital 17 1,291,148 1,291,148 1,291,148 1,291,148 Share premium 878, , , ,055 Asset revaluation reserve 403, , Other reserves 515, , Available-for-sale reserve 8,185 8, Retained earnings/accumulated losses (1,224,653) (927,578) - - Total equity 1,871,848 2,169,204 2,169,203 2,169, The consolidated and separate financial statements were approved by the Board of Directors on 30 January, 2018 and signed on its behalf by: Babatunde Ige Akeem Agbedejobi Olufemi Inubile Director Chief Financial Officer Acting Managing Director FRC/2016/ICAN/ FRC/2016/ICAN/

4 UNIC DIVERSIFIED HOLDINGS PLC CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2017 CONTINUING OPERATIONS Notes Group Company =N='000 =N='000 Revenue ,010 - Cost of sales 19 (17,793) - Gross profit 122,216 - Other operating income 20 43,262 - Operating expenses 21 (451,361) - Operating profit (285,882) - Investment income 22 27,557 - Finance costs 23 (40,812) - Profit/(loss) before tax (299,137) - Income tax expense ,362 - Loss for the year from continuing operations: Attributable to Owners of the Company: (296,775) - OTHER COMPREHENSIVE INCOME Items that may be reclassified subsequently to profit or loss: - - Other comprehensive income for the year, net of income tax 24 (580) - Total other comprehensive income for the year: Attributable to Owners of the Company: (297,355) Earnings/(loss) per share 25 (11) - From continuing operations Basic (Kobo per share) 25 (11) -

5 UNIC DIVERSIFIED HOLDINGS PLC CONSOLIDATED AND SEPERATE STATEMENTS OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2017 GROUP Issued share capital Share premium Asset revaluation reserve Other reserves Available-forsale reserve Retained earnings/accumula ted losses Total For the year ended 31 December 2017 At 1 January ,291, , , ,022 8,765 (927,578) 2,169,204 Loss for the year (296,775) (296,775) Other comprehensive income/(losses) (580) - (580) Transfer between reserves (300) - At 31 December ,291, , , ,322 8,185 (1,224,653) 1,871, (0) For year ended 31 December 2016 At 1 January Loss for the year Other comprehensive income/(losses) Acquisition of subsidiaries 1,291, , , ,022 8,765 (927,578) 2,169,204 At 31 December ,291, , , ,022 8,765 (927,578) 2,169,204 COMPANY For the year ended 31 December 2017 At 1 January ,291, , ,169,203 Loss for the year Other comprehensive income/(losses) Transfer between reserves At 31 December ,291, , ,169,203 For year ended 31 December 2016 At 1 January Loss for the year Other comprehensive income/(losses) Acquisition of subsidiaries 1,291, , ,169,203 At 31 December ,291, , ,169,203

6 UNIC DIVERSIFIED HOLDINGS PLC CONSOLIDATED AND SEPARATE STATEMENTS OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2017 Cash flows from operating activities Profit before tax (299,137) Adjustments: Finance costs charged 40, Depreciation of property, plant and equipments 67, Amortization of intangible assets Impairments Loss on disposal of property, plant and equipments Profit on disposal of property, plant and equipments (191,040) Changes in working capital Decrease/(increase) in Inventory Decrease/(increase) in trade receivables 24, Decrease/(increase) in other receivables and prepayments 9, Increase/(decrease) in trade payables 12, Increase/(decrease) in other payables 141, (3,211) Income tax paid Net cash (used in) operating activities (3,211) Cash flows from investing activities Acquistion of subsidiaries - 34, Purchase of property, plant and equipment (2,521) Proceeds on disposal of property, plant and equipment Proceeds on sale of quoted and unquoted equity securities 6, Proceeds on sale of investment properties Interest received 33, Dividend received 2, Net cash provided by investing activities 39,291 34, Cash flows from financing activities Finance costs paid (13,868) Repayment on finance lease arrangements - - Proceeds of borrowings - - Repayments of borrowings (10,400) - Net cash (used by)/ from investing activities (24,267) Net (decrease)/ increase in cash and cash equivalents 11,812 34, Cash and cash equivalents at begining of the year 34, Foreign exchange difference in cash and cash equivalents Cash and cash equivalents/(net overdrafts) at end of the year 46,369 34, Represented by: Cash and bank balance 44,330 35, Short term investments 4,363 10, Bank overdraft (2,323) (11,382) ,370 34,

7 NOTES TO THE ACCOUNTS 1 Group Property, plant and equipment Building/ leasehold improvements Motor vehicle Computer equipments Office furniture & fittings Capital workin-progress Cost/Valuation =N='000 =N='000 =N='000 =N='000 =N='000 =N='000 At 1 January ,875, , ,719 33,649 2,300 2,461,383 Additions - 22,192 15,360 5,283-42,835 Revaluations 134, ,682 Disposals - (24,582) (24,582) At 31 December ,009, , ,079 38,932 2,300 2,614,317 Additions - - 2, ,521 Revaluations Disposals At 31 December ,009, , ,363 39,170 2,300 2,616,838 Total Accumulated depreciation At 1 January , , ,661 29, ,311 Charge for the year 46,630 6,085 23,563 2,464-78,744 Disposals - (24,582) (24,582) At 31 December , , ,224 32, ,473 Charge for the year 30,150 6,118 26,786 4,231-67,285 Disposals At 31 December , , ,010 36, ,758 Net book value At 31 December ,744,219 14,534 20,352 2,675 2,300 1,784,080 (0) At 31 December ,774,369 20,652 44,855 6,669 2,300 1,848,844 No impairment loss was recognised during the year on the capital work in progress and it has been included in the financial statement as such 2 Investment Properties , Broad /1, Alagbade Street 189, , Plot G9/G10 VGC Shopping Complex 110, , Plot M2, Road 22A VGC (Under developed) 340, , Total investment properties 639, , Investment in Subsidiaries Unic Insurance Limited (Note 3.1) - - 2,169,203 2,169,203 Critical Rescue International (CRI) (Note 3.2) - - 5,000 5,000 VGC Recreational Investment Trust Limited (Note 3.3) ,000 10,000 Allowance for impairment on subsidairies - - (15,000) (15,000) At the end of the year - - 2,169,203 2,169, Unic Insurance Limited Unic Insurance Limited commence operation on 1 October It was incorporated as a private liability company on 2 April 1965 and became a public liability company on 27 February 1990 and later delisted back to a limited liability company on 10 April The principal activity was initially a composite insurance company but later limited to Life and Health Insurance business as well as Financial Services since 2007 consolidation exercise in the insurance industry. 3.2 Critical Rescue International Critical Rescue International (CRI) was incorporated in Nigeria on October as a wholly owned subsidiary. Its principal activities include the provision of medical emergency rescue assistance and other medical related services. The amount of investment is N5million. 3.3 VGC Recreational Investment Trust Limited VGC Recreational Investment Trust Limited, a wholly owned subsidiary, was incorporated in Nigeria on 3 February 2005 as a private limited liability company and commenced business in October The principal activity of the company is the management of recreational clubs and the provision of recreational facilities. The amount of investment is N10million.

8 NOTES TO THE ACCOUNTS (cont'd) 4 Other financial assets The Group's financial assets are summarised by categories as follows: Equity securities available-for-sale (Note 4.1) 261, , Loans and receivables (Note 4.2) 878, , Total financial assets 1,140,889 1,181, Total current 304, , Total non-current 836, , ,140,889 1,181, Available-for-sale financial assets Quoted equity securities at fair value 13,322 15, Unquoted securities at cost (Note 4.1.1) 465, , Allowance for impairment of available-for-sale financial assets (217,165) (217,415) - - Total available-for-sale financial assets 261, , Movement on allowance for impairment on available-for-sale financial assets At the begining of the year 217, Written off during the year (250) 217, , , Analysis of Unquoted Shares Retail Distribution Development 161, , Travent Equity Fund 82,542 82, Vector Finance 58,250 58,250 Others 163, , , , Others includes unquoted equities in Aiico Pensions Ltd, Sterling Assurance Ltd and several others Unquoted securities are carried at cost because there fair value cannot be measured reliably. The unquoted securities are majorly equities which are not traded or quoted on any stock exchange. The company has no intention to dispose the securities in the foreseeable future. 4.2 Loans and receivables Loans to insurance policy holders Loans to related parties 886, , Staff loans and advances 17,247 12, Allowance for impairment of loans and receivables (Note 4.3) (24,858) (24,876) - - Total loans and receivables at amortized cost 878, , Analysis of allowance for impairments on loans and receivables Loans to insurance policy holders Loans to related parties 11,878 11, Staff loans and advances to exit staff 12,980 12, Total allowance for impairment of loans and receivables 24,858 24, Movement on allowance for impairment on loans and receivables At the begining of the year 24,858 24, Write back / (written off) during the year Impairment reversal during the year (Note 33) ,858 24, Statutory deposits This represents theamount deposited with Central Bank of Nigeria (CBN) for the insurance business in accordance with section 9(1) and section 10(3) of Insurance Act This is restricted cash as management does not have access to the balances in its day to day activities. 6 Intangible assets Computer Goodwil Total Group software software Cost: At 1 January , ,251 Additions for the year - 1,741,638 1,741,638 At 31 December ,251 1,741,638 1,958,889 Additions for the year At 31 December ,251 1,741,638 1,958,889 Accumulated amortisation and impairment: At 1 January , ,032 Amortisation for the year At 31 December , ,251 Amortisation for the year At 31 December , ,251 Carrying amount: At 31 December ,741,638 1,741,638 At 31 December ,741,638 1,741,638

9 NOTES TO THE ACCOUNTS (cont'd) The Group purchases its computer softwares from reputable international software vendor. Computer software amortisation profile is in line with the Group s policy on intangible assets. As at 30 September 2017, management has determined that no impairment is required in respect of this asset (2016: Nil). Goodwill This represnts goodwill on consolidation. It is as follows: 7 Inventory Drugs and consumables stock Food and beverages 2,417 2, Total inventories 2,986 3, Trade receivables Insurance receivables 57,413 57, Recreational service, health and other trade receivables 135, , Allowance for impairment of trade receivables (Note 3.1) (87,334) (56,377) - - Total trade receivables 105, , Trade receivables are non-interest bearing and are generally on terms of 30 and 90 days. Other trade receivables are recreational and medical receivables. 9 Other receivables and prepayments Statutory recoverable (WHT) 163, , Prepayments 30,946 4, Receivable on disposal of equities 65, Other receivables (Note 9.1) 131, , Allowance for Impairment of other receivables (Note 9.2) (51,509) (45,929) , , The carrying amounts disclosed above reasonable approximate the fair value at the reporting date. All other receivable amounts are collectible within one year and the prepayment utilisable within one year. 0 (0) 9.1 Included in other receivables is an amount of million receivable from Financial derivatives Limited (2016: 39.3 million) and an amount of 44.9 million (2016: million) receivables on recreational and other services. 10 Cash and cash equivalents Cash-in-hand Balances held with local banks 30,378 30, Balances held in domicilliary accounts 13,457 3, Short-term placements 4,363 10, ,693 45, Interest bearing borrowings Bank overdrafts (Note 11.1) 344, , Bank loans (Note 11.2) 2,323 11, , , Non current 344, ,010 Current 2,323 11, , , Group Reconcilliation of Borrowings 2017 Loans Bank Overdrafts At begining of the year 11, , ,392 Withdrawals /additions during the year (3,470) 53,109 49,639 Interest charged during the year 1,341 42,342 43,682 Principal repayments during the year (6,930) (6,938) (13,868) At end of the year 2, , ,846 Total 2016 At begining of the year 175,896 81, ,698 Withdrawals /additions during the year - 148, ,154 Interest charged during the year 46,823 33,400 80,223 Principal repayments during the year (211,337) (7,346) (218,683) At end of the year 11, , , Bank overdrafts These represent the outstanding balance on bank account which overdraft facilities were agreed on during the year. They are secured against certain financial assets of the Group and also by way of legal mortgage on some of the Group s properties as at 30 September They were taking to augment working capital for the Company. They are at interest rates ranging between 20% to 24% per annum. The carrying value of bank overdraft at year end reasonably approximates its fair value.

10 NOTES TO THE ACCOUNTS (cont'd) 11.2 Bank loans These represent the outstanding balances on loans taken from banks to fund additional investments and operation by the Group. The loans are renewable medium-term tenored at interest rates ranging between 20% and 25% per annum. They are secured against certain financial assets of the Group and also by way of legal mortgage on some of the Group s properties as at 30 September Group Tenure Security Interest rates Months % '000 '000 Access Bank 12 VGC 20 2,323 68,117 Sterling Bank 6 VGC undeveloped ,779 2, ,896 Group Company 12 Retirement benefit obligations Defined benefit staff gratuity scheme (Note 12.1) 13,337 12, ,337 12, Defined benefit staff gratutity scheme The Group operates a defined benefit staff gratuity plan where qualifying employees receive a lump sum payment based on the number of years served after an initial qualifying period of five years and gross salary on date of retirement. Contributions to the defined benefit obligations has been discontinued and the balance relevant to staff is payable when they exit the company. There are no plan assets explicitly segregated to meet gratuity benefits. The scheme is not funded, Company meets benefits on a pay-as-you-go basis. Statement of financial position obligation for: The amounts recognised in the statement of financial posistion are determined as follows: '000 '000 '000 '000 Defined benefits obligation at the end of the year 13,337 12, ,337 12, Past service costs ,337 12, The movement in the defined benefit obligation over the year is as follows: At beginning of the year 13,468 13, Interest cost 710 1, Remeasurement (gains)/losses - Assumption (Note 34.3) (841) (1,576) - - Remeasurement (gains)/losses - Experience (Note 34.3) - (446) - - Transfer of retired staff Benefit paid - (250) - - At end of the year (per valuation) 13,337 12, The amounts recognised in the statement of profit or loss are as follows: Current service cost Interest cost 841 1, Expected return on plan assets Amortisation Total, included in staff costs 841 1, The principal actuarial assumptions used in determining the gratuity benefit obligations were as follows: Discount rate (per annum) 11.0% 11.0% - - Average pay increase (per annum) 0.0% 0.0% - - Average rate of inflation (per annum) 9.0% 9.0% Other payables Non current - Note 13(i) 2,224,110 2,090, Current - Note 13(ii) 774, , ,998,310 2,857, (i) Non current: Insurance contract liabilities 481, , Investment contract liabilities 1,742,919 1,632, ,224,110 2,090,

11 NOTES TO THE ACCOUNTS (cont'd) 13(ii) Current: Non trade payable 173, , Statutory payables 60,072 64, Dividend payable 34,229 34, Rent received in advance (Note 13.2) Defined contribution scheme (Note 13.3) 84,118 79, Payable on recreational and other services 176, , Directors fee payable 25,256 22, Audit fee payable 13,500 12, Information technology development levy 7,378 7, Payable on promisory note 67,534 67, Payable to Consultants 88,231 83, Payable to third party 13,549 13, Rent payable 1, Payable to staff 28,206 21, Health payables 250 6, Payable to related parties , , Non trade payable represents obligation to various Unic pensioners (104 in number as at 31 December 2016) 13.2 Movement in rent received in advance is as shown below: At begining of the year Received in advance - 6, Released on disposal of investment properties Released to statement of profit or loss (Note 30) - (6,682) - - At end of the year Defined contribution scheme In accordance with the provisions of the Pensions Act 2014, the Group and its staff operate a contributory pension scheme. The contribution by employees and the Group are 8% and 10% respectively of the employees' basic salary, housing and transport allowances. The contribution made and transfered to the pension fund administrator during the year are as follows; Balance at start of year 79,124 72, Provisions during the year 4,994 6, Transfer to PFA Balance at end of year 84,118 79, Deferred tax assets/liabilities The following is the analysis of deferred tax liabilities/(assets) presented in the statement of financial position: Deferred tax assets At 1 January 116, Income tax expense during the period recognised in profit or loss At 31 December 116, Opening balance Recognized in Profit/Loss Closing balance Deferred tax (liabilities)/assets in relation to: Investment properties (362,074) - (362,074) Employee benefits 3,788-3,788 Property, plant & equipment (12,561) - (12,561) Investment allowance (129) - (129) Unabsorbed capital allowances 92,078-92,078 Unrelieved losses 37,482-37,482 (241,416) - (241,416) 2016 Deferred tax (liabilities)/assets in relation to: Investment properties (375,425) (13,351) (362,074) Employee benefits 3,160 (628) 3,788 Property, plant & equipment (6,714) 5,846 (12,561) Investment allowance (16) 113 (129) Unabsorbed capital allowances 82,267 (9,811) 92,078 Unrelieved losses 23,742 (13,740) 37,482 (272,986) (31,570) (241,416) 15 Trade payables Insurance trade receivables 404, , , ,

12 NOTES TO THE ACCOUNTS (cont'd) 16 Current Income tax payable The major components of income tax expenses for the years ended 31 December 2017 and 2016 are: 16.1 Per statement of profit or loss: Income tax based on profit for the year 5,443 8, Education tax for the year Capital gains tax - 30, Total current income tax expense 5,606 38, Deferred taxation: Relating to origination and reversal of timing differences - (19,887) - - Income tax charged to profit or loss 5,606 18, Per statement of other comprehensive income: Deferred tax relates to items charged or credited directly to other comprehensive income during the year: '000 '000 '000 '000 Insurance actuarial gain/(loss) (Note 34.3) Gain on revaluation of land and buildings (Note 34.2) - 40, Income tax charged directly to other comprehensive income - 41, Reconciliation of tax charge: (Loss)/profit before income tax expense Tax at Nigerian's statutory income tax rate (8,640) (139,259) - - Non-deductible expenses for tax purpose 11, , Tax exempt income (4,742) (14,543) - - Capital gains tax - 30, Impact of minimum tax 7,685 6, Education tax levy Tax rate differential on fair value gains - 10, Total tax charge expense for the year 5,606 18, Per statement of financial position: Current income tax payable At 1 January 151, , Charged to statement of profit or loss 5,606 38, Payment during the year - (25,106) - - At the end of the year 157, , Authorized and Issued Share Capital 17.1 Authorized Share Capital 4,000,000,000 Ordinary Shares of N0.50 each 2,000,000 2,000,000 2,000,000 2,000, Issued Share Capital 2,582,296,000 Ordinary Shares of N1 each 1,291,148 1,291,148 1,291,148 1,291, Revenue Recreational services 140, Health services Insurance services Other services , Cost of sales Recreational services 17, Health services Insurance services Other services , Other operating income Rental income properties (Note 8 and 15.2) Dividend income 2, Foreign exchange differences (4,995) Health care and recreational services Insurance business 7, Net fair value gains/(losses) on investment properties Net realised gains/(losses) 3, Other income 35, Other income include sport and other recreational income of N25.9m, other insurance income of N3.4m 43,

13 NOTES TO THE ACCOUNTS (cont'd) 21 Operating expenses Employee benefits expense 67, Auditors remuneration 7, Amortisation of intangible assets Depreciation on property, plant and equipment 30, Legal and professional expenses 9, Impairment reversal on loans and receivables Impairment on other receivables Bank and other service charges 1, Cost of services 159, Office rent and administrative expenses 12, Marketing and selling expenses 2, Regulatory expenses 2, Recapitalisation expenses 8, Other operating expenses 148, Other operating expenses include loss on investment contract liabilities of N147.1m , Investment income Interest income 27, Other investment income , Finance costs Interst on bank Loans 40, Lease finance interest , Other comprehensive income/(loss): Net losses on available-for-sale assets Remeasurement loss on available-for-sale financial asset (580) Reclassification adjustments for disposed available-for-sale financial assets (580) Earnings/(loss) per share Basic losses per share amounts is calculated by dividing the net loss for the year attributable to ordinary share holders by the weighted average number of ordinary shares outstanding at the reporting date. The following reflects the losses and share data used in the basic losses per share computations: Net loss attributable to ordinary shareholders ( '000) (296,775) Weighted average number of ordinary shares in issue as at year end ('000) 2,582,296 2,582,296 2,582,296 2,582,296 Diluted Basic losses per ordinary share (kobo) (11) There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of completion of these financial statements. 26 Loss on ordinary activities before taxation is stated after charging: (Profit)/ loss on sale of property, plant and equipment (Profit)/ loss on sale of investment property Directors' emoluments Auditors' remuneration 7, Depreciation of property, plant and equipment 30, Amortisation of intangible assets Exchange (gain)/loss (4,995) - - -

14 NOTES TO THE ACCOUNTS (cont'd) 27 Segment information Segment statement of profit or loss for the year ended 31 December 2017 Others Recreational Service Health Services Insurance Services Total Segments Adjustments and eliminations Total Revenue - External - 140, , ,010 Inter-segment Total Revenue - 140, , ,010 Cost of sales - (17,793) - - (17,793) - (17,793) Gross profit - 122, , ,216 Other operating income 31,085-34,098 65,183 (21,921) 43,262 Depreciation & amortization - (8,268) - (191) (8,459) - (8,459) Impaiments Other operating expenses (161,789) - (250,962) (412,751) (30,150) (442,902) Operating profit - (16,756) - (217,055) (233,811) (52,071) (285,882) Investment income ,557 27,557-27,557 Finance costs (63,312) (63,312) 22,500 (40,812) Profit before tax - (16,756) - (252,810) (269,566) (29,571) (299,137)