Thunderbird Resorts 2016 Half-Year Report Filed
(Thomson Reuters ONE) -
Thunderbird Resorts Inc. /
Thunderbird Resorts 2016 Half-Year Report Filed
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The issuer is solely responsible for the content of this announcement.
PANAMA, REPUBLIC OF PANAMA--(Marketwired - Aug. 31, 2016) - Thunderbird Resorts
Inc. ("Thunderbird") (FRANKFURT:4TR)(EURONEXT AMSTERDAM:TBIRD) is pleased to
announce that its 2016 Half-year report has been filed with the Euronext
("Euronext Amsterdam") and the Netherlands Authority for Financial Markets
("AFM"). As a Designated Foreign Issuer with respect to Canadian securities
regulations, the Half-year report is intended to comply with the rules and
regulations set forth by the AFM and the Euronext Amsterdam.
Copies of the Half-year report in the English language will be available at no
cost at the Group's website at www.thunderbirdresorts.com.Copies in the English
language are available at no cost at the Group's operational office in Panama
and at the offices of our local paying agent ING Commercial Banking, Paying
Agency Services, Location Code TRC 01.013, Foppingadreef 7, 1102 BD Amsterdam,
the Netherlands (tel:+31 20 563 6619, fax: +31 20 563 6959,
email: iss.pas(at)ing.nl). Copies are also available on SEDAR at www.SEDAR.com.
Below are certain material excerpts from the full 2016 Half-year Report the
entirety of which can be found on our website at www.thunderbirdresorts.com.
LETTER FROM THE CEO
Dear Shareholders and Investors:
While we always give considerable thought to the Letter from the CEO, the letter
in this 2016 Half-year Report is of particular importance, with a four-part
agenda as follows. Sections 2 and 3 below are of particular relevance for
shareholders who wish more insight into the Special Resolution that has been
sent for consideration at our September 21, 2016 Annual General and Special
Shareholders' Meeting.
1. Summarize progress through the 2016 Half-year period against our previously-
stated goals.
2. Describe the rationale for the special resolution that has been sent to
shareholders for consideration at our September 21, 2016 Annual General and
Special Shareholders' Meeting. The resolution referred to is a Special
Resolution that the Company may post-sale of its assets: Pay a liquidating
distribution to shareholders and formally liquidate and dissolve the
company.
3. Describe those factors that could impact the net value of the Group's assets
as compared to its current market capitalization. Those items discussed
herein are: i) Valuation metrics commonly used in our markets for the
acquisition of gaming cash flows and for commercial real estate; and ii)
Valuation adjustments that are most typical in these types of transactions
such as asset transfer tax, capital gains tax, contingencies, escrows,
potential litigation liabilities or assets and such working capital items as
cash and cash equivalents, pre-paid expenses and deposits and borrowings.
4. Summarize our conclusions and offer key notes for consideration.
Please refer to the section entitled "Forward Looking Statement" on page 2 which
contains all of the admonitions concerning reliance on the information we
provide to you. In summary, none of the information described in points 2 and 3
in this letter should be relied on in your analysis of the net liquidation value
of the Group. Rather, we would expect you as a shareholder to perform and rely
on your own research and on the publicly available financial information
provided by the Group in 2016 and in previous years. Any and all "metric"
information provided in points 2 and 3 of this letter should not be relied upon
by potential acquirers of our assets as the Group will seek to sell assets at
values that protect the interests of our shareholders. Any final pricing of any
Group asset will be based on numerous factors, including the number of bidders,
the terms of the particular transaction, the time-value and other considerations
that the Group deems relevant to setting the final terms of a specific
transaction.
1. PERFORMANCE UNDER OUR PREVIOUSLY-STATED GOALS
In the CEO Letter to Shareholders published in the 2015 Annual Report, the Group
stated certain goals that support achieving profitability and building a healthy
company. A detailed update can be found in the remaining chapters of this
report. Below is a summary update on our progress through June 30, 2016.
A. Increase our EBITDA((1)): Adjusted EBITDA (after deducting Corporate-level
expenses) reduced by $333 thousand or 18.1% on a USD basis as compared to Half-
year 2015. However, under a currency neutral analysis (in which the same
exchange rate would be applied to both periods), the Group's Adjusted EBITDA
decreased by only $31 thousand or 2.0% as compared to 2015. The $333 thousand
reduction of Adjusted EBITDA was driven by $1.5 million in decreased revenues
for the Group, meaning that the Group has also made corresponding cuts in
expense to offset the revenue loss as reported in US dollars. Moreover, under a
currency neutral analysis (in which the same exchange rate would be applied to
both periods), Group revenue would actually have reduced by only $37 thousand,
meaning that a reduction in revenue was in fact primarily an issue of foreign
exchange.
B. Improve our Profit / (Loss): Our Loss from Continuing Operations improved by
$906 thousand or 38.8%. The improvement is the result of reduced interest and
financing costs and higher Other gains as compared to Half-year 2015. Other
gains are mainly related to the sale of the office building in Panama.
C. Reduce our borrowings: Gross debt(2) has been reduced to $30.3 million on
June 30, 2016 as compared to $32.1 million on December 31, 2015. Net debt (gross
debt less cash and cash equivalents) has been reduced to $28.2 million on June
30, 2016 as compared to $29.3 million on December 31, 2015.
2. SPECIAL RESOLUTION PROVIDED TO SHAREHOLDERS FOR CONSIDERATION
On August 25, 2016, the Group sent to shareholders the supporting materials for
our September 21, 2016 Annual General and Special Shareholders' Meeting.
Included within those materials was a Special Resolution requesting that the
Company's shareholders approve the following:
BE IT RESOLVED THAT:
i. The Board of Directors of the Corporation is hereby authorized, at a time to
be determined by the Board of Directors of the Corporation, to voluntarily
dissolve the Corporation pursuant to the BVI Business Corporate Act of 2004,
which winding up process and dissolution application shall be commenced and
implemented at such time as determined by the Board in their sole discretion;
ii. The Board of Directors of the Corporation is hereby authorized to make
provision for and to discharge all liabilities of the Corporation in conjunction
with the winding up and dissolution of the Corporation and in connection with
such winding up and dissolution, is authorized to make a pro rata distribution
to shareholders of the net proceeds available to the Corporation (after
adjusting for carrying costs and other winding up and dissolution related
expenses) from the sale of any or all remaining assets of the Corporation in
such amounts and at such times as determined by the Board of Directors;
iii. Any one director or officer of the Corporation be and is hereby authorized
and directed to do all such things and to execute and deliver all documents and
instruments as may be necessary or desirable to carry out the terms of this
resolution, including but not limited to the filing of articles of dissolution
under the BVI Business Corporations Act; and
iv. The directors of the Corporation may, in their discretion, without further
approval of the shareholders, revoke this special resolution at any time before
the filing of articles of dissolution under the Business Corporation Act (BVI)
in respect of the foregoing.
Granting the Board of Directors the right to voluntarily dissolve the
Corporation does not mean that the same will occur. Approval of shareholders in
advance allows the Board the flexibility to undertake the same should the Board
deem it to be in the best interest of shareholders based on the circumstances at
the time, without the risk of delay of approval of specific transactions or the
expense of calling another shareholder meeting to specifically approve such
matter. In the event that the Company proceeds with its plan to liquidate and
dissolve, the company in due course intends to delist from the Euronext
Amsterdam in accordance with the rules and procedures of the Euronext Amsterdam.
Also included within the materials for the Annual General and Special
Shareholders' Meeting was a rationale for this Special Resolution, which we
summarize immediately below.
As published in the Corporation's 2014 Half-year Report, 2014 Annual Report,
2015 Half-year Report, the Q3 2015 Interim Management Statement, and the 2015
Annual Report, the Board of Directors and Management both believe that the
market capitalization of Thunderbird Resorts Inc. is less than its intrinsic
value, which we define as:
The net proceeds which the Group could achieve through liquidating all operating
and real estate assets; plus the net proceeds achievable from completing all tax
and non-tax litigations and fulfilling all escrow periods for escrows; and less
carrying costs to manage process and operations while the Group remains a
publicly-traded company.
Moreover, the Board of Directors and Management believe that it is increasingly
difficult to finance growth and to achieve accretive value for the following
reasons:
A. The lack of liquidity in our stock means that we cannot use our stock as
currency to acquire cash flow.
B. Banks are increasingly reticent and many now even prohibit working with
gaming companies, which means that access to competitively priced debt and
amortization schedules is now virtually impossible to achieve, and therefore
bank financing is not a mechanism for investment in growth.
C. The Group has historically relied on high-yield bonds, but this market has
dried up for two reasons: i) The stage of development of gaming in our markets
has matured in recent years, meaning that the gaming sector in these markets is
experiencing relatively moderate growth and can no longer afford the double-
digit interest rates and single-digit loan periods that are standard
requirements of high-yield bonds; and ii) Even if the Group could afford to
service high-yield bonds, since the financial crisis bond investors are
exceedingly more cautious about investing and there are far fewer of them.
D. Our geographic markets have large concentrations of wealth in few hands,
which means that the number of acquirers for our real estate assets are small
and the time to sell at a competitive price can be exceedingly long, which means
we are not able to generate proceeds from real estate asset sales on a timely
basis to invest in growing our operating assets.
Because the Group believes that shareholders should achieve higher returns
through a liquidating distribution as compared to the market cap at the date of
publication of this 2016 Half-year Report and as compared to some future market
cap given the lack of resources to invest in growth, we recommend that the
shareholders carefully consider the Special Resolution as described. We also
suggest that shareholders consider the low level of liquidity for the stock of
Thunderbird Resorts Inc., and the difficulty that low demand creates for
shareholders to achieve an exit via the market.
To view all of the materials for the Annual General and Special Shareholders'
Meeting, including a copy of the resolution itself, please click on the
following link: http://thunderbirdresorts.com/wp-content/uploads/2016/08/2016-
AGM-press-release-aug-25-2016.pdf.
3. MARKET-BASED VALUATION METRICS
The Group operates in different markets, we have varied ownership levels in our
assets, and we operate in sectors ranging from gaming to hospitality to real
estate. Because there are many factors that could influence the realizable value
of liquidated assets, shareholders may find it challenging to get comfortable
with their own analyses of the net value of the Group's assets. By reviewing
this section along with the full 2016 Half-year Report, the Information Circular
(see link above) and relevant past disclosures, we hope you will have sufficient
information to prepare your own analysis. Should you have follow-up questions,
please kindly direct them to Albert Atallah, General Counsel via email
to aatallah(at)thunderbirdresorts.com. We will publish any price sensitive
information stemming from these questions and answers.
While it is not appropriate for the Board of Directors or Management to forecast
net asset values or to forecast the possible ranges of liquidating distributions
to shareholders, below we do provide metrics that are commonly used in markets
in which we own assets.
A. Valuation of Gaming Cash Flows: Earnings before Interest, Tax, Depreciation
and Amortization ("EBITDA") is widely used in the gaming industry in our markets
as a substitute for operating cash flow. To determine the gross value of EBITDA
in our markets, acquirers and sellers commonly reach a valuation based on a
range of 4.5X to 6.0X historic EBITDA rather than a formula based on the net
present value of forecasted future cash flows. Valuations below 5X EBITDA are
generally reserved for poorly managed businesses that require material upgrades
to sustain revenue. Valuations of 6X are generally reserved for premium
locations with demonstrable growth potential. Our gaming EBITDAs for Peru and
Nicaragua totaled $5.6 million in 2015 and our unaudited, preliminary gaming
EBITDAs through half-year 2016 are approximately $2.5 million. Please remember
that the Group is a 100% shareholder of all of its Peru real estate and
operating assets and a 55.9% shareholder of all of its Nicaragua real estate and
operating assets, so EBITDA multiples should be calculated on a pro rata basis.
B. Adjustments to the Valuation of Gaming Cash Flows: Common adjustments to the
valuation of gaming EBITDA include: i) Add back adjustments for corporate shared
services that could be redundant for a buyer, meaning that there could be a
discussion of a price increase based on synergistic efficiencies to be passed to
a buyer that operates in the market; ii) In the case of an operation sold that
is not currently paying a lease because it operates within real estate we own, a
lease amount might be negotiated based on cap rates similar to those provided in
paragraph 3C below and deducted from the EBITDA calculation used to determine
valuation of gaming cash flows as per paragraph 3A above; and iii) Typical
working capital adjustments based on balance sheet items.
C. Valuation of Income-producing Real Estate: The value of income producing real
estate in our operating countries and sectors is generally determined by
capitalization rates ranging from 9% to 11% depending on the quality of the real
estate and whether it supports hospitality, office or gaming operations. Special
Note on the Real Estate of Fiesta Hotel & Casino: The Fiesta Hotel & Casino is a
mixed-use hotel, office complex and retail real estate property in the heart of
Miraflores, Lima in Peru. We are currently in discussions with several qualified
investors, all of which are either financial investors or strategic investors
who do not operate in the gaming sector. The April 2015 real estate valuation
for this property was provided by a well-respected real estate appraisal firm
that is commonly used by banks in Peru when evaluating real estate loan
transactions. Regardless of the appraised value, final pricing for this asset
will most likely be determined by the cash flow sold with the real estate, which
most likely will be the hotel cash flows, office leases, parking garage cash
flows and a lease to be negotiated for the retail gaming space. Based on the
current levels of cash flow and on the practical reality that only a portion of
the casino cash flow (via a lease back) would likely be made to a buyer of this
real estate, the Group expects that the maximum realizable gross value of this
real estate will be no more than $35 million based on the information available
today.
Other Valuation Inputs: As referenced in the third bullet at the very top of
this letter, it is important to take into account valuation adjustments that are
most typical in these transactions such as asset transfer tax, capital gains
tax, contingencies, escrows, potential litigation liabilities or assets and such
working capital items as cash and cash equivalents, pre-paid expenses and
deposits and borrowings. The point of this paragraph is to help the reader to
better understand the impact of each of these items when evaluating the net
liquidation value of the Group. Real estate and share transfer taxes, as well as
capital gains taxes, should be available online through multiple sources. For
information regarding Group escrows that could possibly be partially or wholly
recovered, please refer to our 2015 Annual Report and specifically to Note 11
and to Chapter 2, "Other Group Updates." For information regarding tax
contingencies, pre-paid taxes in cases that continue under dispute and
litigation "liabilities / assets," please refer to the Notes 17 and 22 in the
2015 Annual Report. For information on Group debt, please kindly review this
2016 Half-year Report. Finally, we believe it is important to measure and
understand the carrying costs of the Group, which we have referenced in Chapter
2, "Other Group Updates" of this 2016 Half-year Report. At this time, we cannot
estimate: i) The number of months or possibly even years it could take for the
Group to complete implementation of the Special Resolution should in fact it be
approved and fully implemented; and ii) Which assets might be sold first and, if
the Special Resolution is fully implemented, when it would be likely to make a
liquidating distribution. Finally, the number of issued and outstanding shares
of Thunderbird Resorts Inc. as of the publication of the 2016 Half-year Report
is 25,054,371. In regards to the number of issued and outstanding shares, it is
important to note that Officers are materially discounting their salaries so as
to preserve Group cash, and it is possible that this discount could be re-paid
in shares of the Group as described in Chapter 2 "Other Group Updates" of this
2016 Half-year Report.
4. CONCLUSIONS AND KEY NOTES FOR CONSIDERATION
We recognize that this is an unusual Letter from the CEO, but we strongly
believe that shareholders should have the opportunity to learn about valuation
metrics that are commonly used in our operating markets. Regardless, it is the
responsibility of the shareholder to perform their own analysis of the market
and of our reporting and to reach their own conclusions on the net liquidation
value of the Group as compared to its current market capitalization. We offer
the following conclusions and key notes for your consideration.
A. The Board of Directors and Management believe, but cannot be certain, that
the intrinsic value as defined herein should be greater than the average market
capitalization of the Group in the months leading up to this publication. For
this reason, we are presenting to shareholders the Special Resolution to
distribute from the sale of the Group's assets followed by the formal
liquidation of company assets and dissolution of the company. Regardless, there
can be no assurances whatsoever that any liquidating distribution, if paid (see
next paragraph), will exceed the current market capitalization.
B. Should a Special Resolution be approved, it is possible that the Board of
Directors and Management might not actually implement the Special Resolution if
there were a change in circumstance that made it in the best interests of
shareholders to postpone or cancel its implementation. For example, if the Group
were able to sell a material portion of its real estate by early 2017, it is
possible that the Group could become virtually debt free and could start to
generate regular, material cash flows; in which case, it might at that point be
in the interest of shareholders for the Group to spend time building accretive
value and cancel or postpone the implementation of the Special Resolution. On
the other hand, if the Group is not able to sell a material portion of its real
estate by early 2017, then it would likely be in the interest of shareholders
that the Group also pursue sales of its operating assets and fully implement the
Special Resolution.
C. In the meantime, shareholders may choose to exit at prices set by the market
at any time or retain their shareholding positions in order to benefit from a
potential distribution should in fact shareholders approve the Special
Resolution and should in fact the Group fully implement the Special Resolution.
We will keep you informed as there are material events and progress.
Salomon Guggenheim, Chief Executive Officer and President
August 31, 2016
(1.) "EBITDA" is not an accounting term under IFRS, and refers to earnings
before net interest expense, income taxes, depreciation and amortization, equity
in earnings of affiliates, minority interests, development costs, other gains
and losses, and discontinued operations. "Property EBITDA" is equal to EBITDA at
the country level(s). "Adjusted EBITDA" is equal to property EBITDA less
"Corporate expenses," which are the expenses of operating the parent company and
its non-operating subsidiaries and affiliates.
(2.) Gross debt equals total borrowings and finance lease obligations.
GROUP OVERVIEW
Below is our consolidated profit / (loss) summary for our continuing operations
for the six months ended June 30, 2016 as compared with the same period of
2015. In summary, Group revenue and adjusted EBITDA have reduced on a USD basis
(see "Forex" note below), despite lower country-level operating expenses and
reduced corporate expenses. See notes on certain key items below.
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(In thousands, proportional
consolidation)
Six months ended
June 30
-----------------------
2016 2015 Variance % change
--------------------------------------------
Net gaming wins $ 16,124 $ 17,209 $ (1,085 ) -6.3 %
Food and beverage sales 1,429 1,501 (72 ) -4.8 %
Hospitality and other sales 1,923 2,313 (390 ) -16.9 %
--------------------------------------------
Total revenues 19,476 21,023 (1,547 ) -7.4 %
--------------------------------------------
Promotional allowances 2,474 2,282 192 8.4 %
Property, marketing and
administration 13,777 14,724 (947 ) -6.4 %
--------------------------------------------
Property EBITDA 3,225 4,017 (792 ) -19.7 %
--------------------------------------------
Corporate Expenses 1,723 2,182 (459 ) -21.0 %
--------------------------------------------
Adjusted EBITDA 1,502 1,835 (333 ) -18.1 %
--------------------------------------------
Property EBITDA as a percentage of
revenues 7.7 % 8.7 %
Depreciation and amortization 1,514 1,836 (322 ) -17.5 %
Interest and financing costs, net 1,697 2,124 (427 ) -20.1 %
Management fee attributable to
non-controlling interest 2 - 2 0.0 %
Project development - 48 (48 ) -100.0 %
Foreign exchange (gain) / loss 294 466 (172 ) -36.9 %
Other (gains) / losses (716 ) (470 ) (246 ) 52.3 %
Income taxes 143 169 (26 ) -15.4 %
--------------------------------------------
Loss for the period from
continuing operations (1,432 ) (2,338 ) 906 -38.8 %
-------------------------------------------------------------------------------
Forex: The strengthening of the US dollar versus our operating currencies
continues to have a material impact on our business as compared to the same
period in 2015. Under a currency neutral analysis (in which the same exchange
rate would be applied to both periods), Group revenue would have decreased by
only $37 thousand or 0.2% (virtually no change), while adjusted EBITDA would
have reduced by just $31 thousand or 2.0%.
Group Debt: Below is the Group's Gross debt and Net debt on June 30, 2016.
-------------------------------------------------------------------------------
(In thousands)
Jun-16 Mar-16 Dec-15
---------------------------
Borrowings $ 29,247 $ 29,417 $ 30,701
Obligations under leases and hire purchase
contracts 1,038 1,150 1,432
---------------------------
Gross Debt $ 30,285 $ 30,568 $ 32,133
Less: cash and cash equivalents (excludes
restricted cash) 2,092 2,138 2,869
---------------------------
Net Debt $ 28,193 $ 28,429 $ 29,264
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Note: Gross debt above is presented net of debt issuance costs (costs of debt at
time of issuance, which are currently non-cash and amortize over time) which is
why there is an approximate $186 thousand variance with the total principal
balance below.
The Group estimates its debt as follows starting in July 2016:
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Principal
Payment 2016 2017 2018 2019 2020 Thereafter Total
-------------------------------------------------------------------------------------
Corporate $ 5,798,892 $ 5,177,458 $ 2,207,631 $ 1,375,026 $ 1,534,143 $ 1,862,962 $ 17,956,112
Peru 1,213,286 1,749,279 1,420,385 6,497,237 - - 10,880,187
Nicaragua 125,742 269,561 294,885 673,863 175,462 95,073 1,634,586
-------------------------------------------------------------------------------------
Total $ 7,137,920 $ 7,196,298 $ 3,922,901 $ 8,546,126 $ 1,709,605 $ 1,958,035 $ 30,470,885
-------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
Interest
Payment 2016 2017 2018 2019 2020 Thereafter Total
------------------------------------------------------------------------------------
Corporate $ 843,977 $ 931,841 $ 623,971 $ 456,979 $ 297,863 $ 121,721 $ 3,276,352
Peru 491,414 803,430 595,615 213,110 - - 2,103,569
Nicaragua 83,121 145,765 120,441 92,985 24,205 6,675 473,192
------------------------------------------------------------------------------------
Total $ 1,418,512 $ 1,881,036 $ 1,340,027 $ 763,074 $ 322,068 $ 128,396 $ 5,853,113
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RISK MANAGEMENT
For more detail on Risk Factors, see Chapter 5 of the 2016 Half-year Report.
MANAGEMENT STATEMENT ON "GOING CONCERN"
Management routinely plans future activities including forecasting future cash
flows. Management has reviewed their plan with the Directors and has
collectively formed a judgment that the Group has adequate resources to continue
as a going concern for the foreseeable future, which Management and the
Directors have defined as being at least the next 12 months from the filing of
our 2015 Annual Report. In arriving at this judgment, Management has prepared
the cash flow projections of the Group, which incorporates a 5-year rolling
forecast and detailed cash flow modeling through the current financial year.
Directors have reviewed this information provided by Management and have
considered the information in relation to the financing uncertainties in the
current economic climate, the Group's existing commitments and the financial
resources available to the Group. The expected cash flows have been modeled
based on anticipated revenue and profit streams with debt funding programmed
into the model and reducing over time. The model assumes no new construction
projects during the forecast period. The model assumes a stable regulatory
environment in all countries with existing operations. Sensitivities have been
applied to this model in relation to revenues not achieving anticipated levels.
The Directors have considered the: (i) base of investors and debt lenders
historically available to Thunderbird Resorts, Inc.; (ii) global capital
markets; (iii) limited trading exposures to our local suppliers and retail
customers; (iv) other risks to which the Group is exposed, the most significant
of which is considered to be regulatory risk; (v) sources of Group income,
including management fees charged to and income distributed from its various
operations; (vi) cash generation, debt amortization levels and key debt service
coverage ratios; (vii) fundamental trends of the Group's businesses; (viii)
extraordinary cash inflows and outflows from one-time events forecasted to occur
in the 12-month period following the reporting period of this 2016 Half-year
Report; (ix) ability to re-amortize and unsecured lenders; (x) level of
probability of refinancing of secured debt; (xi) liquidation of undeveloped and
therefore non-performing real estate assets that have been held for sale; and
(xii) level of interest by third parties in the acquisition of certain operating
assets.
The Directors have also considered certain critical factors that might affect
its continuing operations, as follows:
* Debt Repayment and Cash Flow: Debt service payments for secured bank loans
in Peru and secured and unsecured loans at the Corporate-level continue to
be a significant part of the Group's outflow. The Group has invested
significant time and effort to refinance debt under longer-term
amortizations, but the banking industry in Latin America is not easily
amenable to financing our gaming operations or real estate that depend on
gaming income. The Group may need to sell the majority of its real estate
assets in order to pay down virtually all Group debt and revert the Group to
positive cash flow.
* Corporate Expense and Cash Flow: Corporate expense has decreased materially
in recent years, and is expected to continue to decrease. Combined with debt
reduction, achieving the Group's announced Corporate expense targets is
critical to achieving positive cash flow. Progress in this regard includes
preliminary, unaudited Corporate expense in half-year 2016 of $1.7 million,
and the Group is now targeting a Corporate Expense run rate of less than
$2.0 million starting approximately in October 2016.
* Liquidity and Working Capital: The Group is currently operating with low
levels of reserves and working capital. Selling all or virtually all Group
real estate and reverting cash flow will be critical to creating a healthy
level of working capital reserves.
Considering the above, Management and Directors are satisfied that the
consolidated Group has adequate resources to continue as a going concern for at
least the 12 months following the reporting period of this 2016 Half-year
Report. For these reasons, Management and Directors continue to adopt the going
concern basis in preparing the consolidated financial statements.
FINANCIAL STATEMENTS
THUNDERBIRD RESORTS, INC.
CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL POSITION
(Expressed in thousands of United States dollars)
As of June 30, 2016 and December 31, 2015
-------------------------------------------------------------------------------
December
June 30, 31,
2016 2015
--------------------------
Assets
Non-current assets
Property, plant and equipment (Note 7) $ 22,673 $ 24,019
Investment accounted for using the equity method
(Note 16) 4,341 5,908
Intangible assets 5,947 5,985
Deferred tax asset 439 423
Trade and other receivables 1,736 1,629
Due from related parties (Note 13) 42 42
--------------------------
Total non-current assets 35,178 38,006
Current assets
Trade and other receivables 1,605 1,126
Due from related parties (Note 13) 1,778 2,070
Inventories 460 480
Restricted cash 1,548 1,534
Cash and cash equivalents 2,092 2,869
--------------------------
Total current assets 7,483 8,079
--------------------------
Total assets $ 42,661 $ 46,085
--------------------------
Equity and liabilities
Capital and reserves
Share capital (Note 11) 110,504 110,456
Share option reserve 89 89
Retained earnings (106,511 ) (104,633 )
Translation reserve (4,804 ) (5,209 )
--------------------------
Equity attributable to equity holders of the parent (722 ) 703
Non-controlling interest 2,038 1,911
--------------------------
Total equity 1,316 2,614
Non-current liabilities
Borrowings (Note 9) 17,575 22,966
Obligations under leases and hire purchase contracts
(Note 10) 209 441
Deferred tax liabilities 21 22
Provisions 569 616
Trade and other payables 495 1,133
--------------------------
Total non-current liabilities 18,869 25,178
Current liabilities
Trade and other payables 7,606 5,943
Due to related parties (Note 13) 900 983
Borrowings (Note 9) 11,672 7,735
Obligations under leases and hire purchase contracts
(Note 10) 829 991
Other financial liabilities 373 379
Current tax liabilities 329 361
Provisions 767 1,901
--------------------------
Total current liabilities 22,476 18,293
--------------------------
Total liabilities 41,345 43,471
--------------------------
Total equity and liabilities $ 42,661 $ 46,085
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THUNDERBIRD RESORTS, INC.
CONSOLIDATED CONDENSED STATEMENT OF COMPREHENSIVE INCOME
(Expressed in thousands of United States dollars)
For the six months ended June 30, 2016
-------------------------------------------------------------------------------
Six months ended
June 30 (unaudited)
------------------------
2016 2015
------------------------
Net gaming wins $ 16,124 $ 17,209
Food, beverage and hospitality sales 3,352 3,814
------------------------
Total revenue 19,476 21,023
Cost of goods sold (7,965 ) (7,945 )
------------------------
Gross profit 11,511 13,078
Other operating costs
Operating, general and administrative (10,011 ) (11,243 )
Project development - (48 )
Depreciation and amortization (1,514 ) (1,836 )
Other gains and (losses) (Note 5) 716 470
------------------------
Operating profit / (loss) 702 421
Share of loss from equity accounted investments (Note
16) (57 ) (10 )
Financing
Foreign exchange loss) (294 ) (466 )
Financing costs (Note 6) (1,765 ) (2,217 )
Financing income (Note 6) 75 106
Other interest (Note 6) (7 ) (13 )
------------------------
Finance costs, net (1,991 ) (2,590 )
------------------------
Loss before tax (1,346 ) (2,179 )
Income taxes expense
Current (143 ) (169 )
Deferred - -
------------------------
Income taxes expense (143 ) (169 )
------------------------
Loss for the year from continuing operations $ (1,489 ) $ (2,348 )
------------------------
Gain / (loss) for the year from discontinued
operations (Note 8) (261 ) 6,690
------------------------
Gain / (loss) for the year $ (1,750 ) $ 4,342
------------------------
Other comprehensive income (amounts, which will be
recycled)
Exchange differences arising on the translation of
foreign operations $ 405 $ (1,723 )
------------------------
Other comprehensive income for the year 405 (1,723 )
------------------------
Total comprehensive income for the year $ (1,345 ) $ 2,619
------------------------
Gain / (loss) for the year attributable to:
Owners of the parent (1,878 ) 4,372
Non-controlling interest 128 (30 )
------------------------
$ (1,750 ) $ 4,342
------------------------
Total comprehensive income attributable to:
Owners of the parent (1,473 ) 2,649
Non-controlling interest 128 (30 )
------------------------
$ (1,345 ) $ 2,619
------------------------
Basic loss per share (in $): (Note 12)
Loss from continuing operations (0.07 ) (0.10 )
Gain / (loss) from discontinued operations (0.01 ) 0.29
------------------------
Total (0.08 ) 0.19
Diluted loss per share (in $): (Note 12)
Loss from continuing operations (0.07 ) (0.10 )
Gain / (loss) from discontinued operations (0.01 ) 0.29
------------------------
Total (0.08 ) 0.19
THUNDERBIRD RESORTS, INC.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(Expressed in thousands of United States dollars)
For the six months ended June 30, 2016
---------------------------------------------------------------------------------------------------
Attributable to equity holders of parent
-------------------------------------------------------------------------------------
Share Currency Non-
Share options translation Retained controlling Total
capital reserve reserve earnings Total interest equity
-------------------------------------------------------------------------------------
Balance at
January
1, 2015 $ 110,144 $ 289 $ (1,725 ) $ (106,552 ) $ 2,156 $ 6,404 $ 8,560
Transactions
with owners:
Issue of new
shares 96 - - - 96 - 96
Options
cancellation
and
expiration - (20 ) - 20 - - -
Costa Rica
disposal - - - - - (4,690 ) (4,690 )
-------------------------------------------------------------------------------------
$ 96 $ (20 ) $ - $ 20 $ 96 $ (4,690 ) $ (4,594 )
-------------------------------------------------------------------------------------
Profit /
(loss) for
the year - - - 4,373 4,373 (30 ) 4,343
Other
comprehensive
income
Exchange
differences
arising on
translation
of foreign
operations - - (1,723 ) - (1,723 ) - (1,723 )
-------------------------------------------------------------------------------------
Total
comprehensive
income for
the year (1,723 ) 4,373 2,650 (30 ) 2,620
-------------------------------------------------------------------------------------
Balance at
June 30, 2015 $ 110,240 $ 269 $ (3,448 ) $ (102,159 ) $ 4,902 $ 1,684 $ 6,586
-------------------------------------------------------------------------------------
Transactions
with owners:
Issue of new
shares 536 - - - 536 - 536
Shares buy-
back (320 ) - - - (320 ) - (320 )
Options
cancellation
and
expiration - (180 ) - 180 - - -
Costa Rica
disposal - - - - - 57 57
-------------------------------------------------------------------------------------
$ 216 $ (180 ) $ - $ 180 $ 216 $ 57 $ 273
-------------------------------------------------------------------------------------
Profit /
(loss) for
the year - - - (3,301 ) (3,301 ) 170 (3,131 )
Other
comprehensive
income
Exchange
differences
arising on
translation
of foreign
operations - - (1,761 ) 647 (1,114 ) - (1,114 )
-------------------------------------------------------------------------------------
Total
comprehensive
income for
the year - - (1,761 ) (2,654 ) (4,415 ) 170 (4,245 )
-------------------------------------------------------------------------------------
Balance at
December
31, 2015 $ 110,456 $ 89 $ (5,209 ) $ (104,633 ) $ 703 $ 1,911 $ 2,614
-------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------
Share Currency Non-
Share options translation Retained controlling Total
capital reserve reserve earnings Total interest equity
-------------------------------------------------------------------------------------
Balance at
January
1, 2016 $ 110,456 $ 89 $ (5,209 ) $ (104,633 ) $ 703 $ 1,911 $ 2,614
Transactions
with owners:
Issue of new
shares 48 - - - 48 - 48
-------------------------------------------------------------------------------------
$ 48 $ - $ - $ - $ 48 $ - $ 48
-------------------------------------------------------------------------------------
Profit /
(loss) for
the year - - (1,878 ) (1,878 ) 127 (1,751 )
Other
comprehensive
income
Exchange
differences
arising on
translation
of foreign
operations - - 405 - 405 - 405
-------------------------------------------------------------------------------------
Total
comprehensive
income for
the year - - 405 (1,878 ) (1,473 ) 127 (1,346 )
-------------------------------------------------------------------------------------
Balance at
June 30, 2016 $ 110,504 $ 89 $ (4,804 ) $ (106,511 ) $ (722 ) $ 2,038 $ 1,316
-------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------
THUNDERBIRD RESORTS, INC.
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
(Expressed in thousands of United States dollars)
For the six months ended June 30, 2016
---------------------------------------------------------------------------------------------------
Six months ended
June 30 (unaudited)
2016 2015
----------------------
Cash flow from operating activities
Loss for the year $ (1,489 ) $ (2,348 )
Items not involving cash:
Depreciation and amortization 1,514 1,836
Unrealized foreign exchange (121 ) 466
Decrease in provision (1,186 ) (1,284 )
Other losses / (gains) 8 (470 )
Share based payments 48 96
Finance income (75 ) 2,217
Finance cost 1,765 (106 )
Other interests 7 13
Disposal of Equity accounted investments (1,232 ) -
Results from equity accounted investments 57 10
Tax expenses 143 169
Net change in non-cash working capital items
Decrease in trade, prepaid and other receivables (77 ) (1,605 )
Increase / (decrease) in inventory 23 (48 )
Increase in trade payables and accrued 1,167 642
----------------------
Cash (used) from operations 552 (412 )
Total tax paid (168 ) (199 )
----------------------
Net cash generated by continuing operations 384 (611 )
----------------------
Net cash from discontinued operations - 77
----------------------
Net cash (used) from operating activities $ 384 $ (534 )
----------------------
Cash flow from investing activities
Expenditure on property, plant and equipment (226 ) (2,754 )
Proceeds on sale of property, plant and equipment 1,273 44
Proceeds on sale of Costa Rica Joint Venture 1,534 -
Proceeds on sale of Costa Rica operation - 8,077
Cost of sale of Costa Rica operation - (165 )
Interest received 75 106
----------------------
Net cash used from investing activities $ 2,656 $ 5,308
----------------------
Cash flow from financing activities
Proceeds from issue of new loans 100 870
Repayment of loans and leases payable (2,642 ) (4,955 )
Interest paid (1,267 ) (1,791 )
----------------------
Net cash used from financing activities $ (3,809 ) $ (5,876 )
----------------------
Net change in cash and cash equivalents during the (769 ) (1,102 )
year
Cash and cash equivalents, beginning of the year 4,403 6,551
Effect of foreign exchange adjustments 6 3,867
----------------------
Cash and cash equivalents, end of the year $ 3,640 $ 9,316
----------------------
ABOUT THE COMPANY
We are an international provider of branded casino and hospitality services,
focused on markets in Latin America. Our mission is to "create extraordinary
experiences for our guests." Additional information about the Group is available
at www.thunderbirdresorts.com.
Cautionary Notice: Cautionary Notice: The 2016 Half-year Report referred to in
this release contains certain forward-looking statements within the meaning of
the securities laws and regulations of various international, federal, and state
jurisdictions. All statements, other than statements of historical fact,
included in the 2016 Half-year Report, including without limitation, statements
regarding potential revenue and future plans and objectives of Thunderbird are
forward-looking statements that involve risk and uncertainties. There can be no
assurances that such statements will prove to be accurate and actual results
could differ materially from those anticipated in such statements. Important
factors that could cause actual results to differ materially from Thunderbird's
forward-looking statements include competitive pressures, unfavorable changes in
regulatory structures, and general risks associated with business, all of which
are disclosed under the heading "Risk Factors" and elsewhere in Thunderbird's
documents filed from time-to-time with the Euronext Amsterdam and other
regulatory authorities. Included in the 2016 Half-year Report are certain "non-
IFRS financial measures," which are measures of Thunderbird's historical or
estimated future performance that are different from measures calculated and
presented in accordance with IFRS, within the meaning of applicable Euronext
Amsterdam rules, that are useful to investors. These measures include (i)
Property EBITDA consists of income from operations before depreciation and
amortization, write-downs, reserves and recoveries, project development costs,
corporate expenses, corporate management fees, merger and integration costs,
income/(losses) on interests in non-consolidated affiliates and amortization of
intangible assets. Property EBITDA is a supplemental financial measure we use to
evaluate our country-level operations. (ii) Adjusted EBITDA represents net
earnings before interest expense, income taxes, depreciation and amortization,
equity in earnings of affiliates, minority interests, development costs, and
gain on refinancing and discontinued operations. Adjusted EBITDA is a
supplemental financial measure we use to evaluate our overall operations.
Property EBITDA and Adjusted EBITDA are supplemental financial measures used by
management, as well as industry analysts, to evaluate our operations. However,
Property and Adjusted EBITDA should not be construed as an alternative to income
from operations (as an indicator of our operating performance) or to cash flows
from operating activities (as a measure of liquidity) as determined in
accordance with generally accepted accounting principles.
CONTACT INFORMATION
Thunderbird Resorts Inc.
Peter LeSar
Chief Financial Officer
(507) 223-1234
plesar(at)thunderbirdresorts.com
www.thunderbirdresorts.com
This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Thunderbird Resorts Inc. via GlobeNewswire
Unternehmensinformation / Kurzprofil:
Datum: 01.09.2016 - 04:13 Uhr
Sprache: Deutsch
News-ID 492129
Anzahl Zeichen: 64869
contact information:
Town:
El Cangrejo, Apartado
Kategorie:
Business News
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