Thunderbird Resorts 2017 Half-Year (Semi-Annual) Report Filed
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Thunderbird Resorts 2017 Half-Year (Semi-Annual) Report Filed
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Thunderbird Resorts 2017 Half-Year (Semi-Annual) Report Filed
ZURICH, Switzerland, Sept. 30, 2017 (GLOBE NEWSWIRE) -- Thunderbird Resorts Inc.
("Thunderbird") (FSE:4TR) (Euronext:TBIRD) is pleased to announce that its 2017
Half-year Report and Unaudited Consolidated Financial Statements have 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/Semi-Annual Report is intended to
comply with the rules and regulations set forth by the AFM and the Euronext
Amsterdam.
Copies of the 2017 Half Year Report and Unaudited Consolidated Financial
Statements 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 2017 Semi-Annual Report the
entirety of which can be found on our website at www.thunderbirdresorts.com.
Letter from the CEO
Dear Shareholders and Investors:
Below is an update that summarizes the Group's performance and progress through
June 30, 2017.
1. PERFORMANCE IN ACCORDANCE WITH our previously-stated goals(1)
A. Increase our EBITDA(2): Adjusted EBITDA (after deducting Corporate-level
expenses) increased by $580 thousand as compared to through half-year 2016.
B. Improve our Profit / (Loss): Our Loss from Continuing Operations improved by
$220 thousand and, netting out extraordinary gains in half-year 2016, the
improvement would have been $840 thousand.
C. Increase our Net Debt: Net debt(3) increased by $744 thousand as compared to
year-end December 31, 2016. The Group refinanced its Peru debt, adding debt
that it is now using to reduce costs and improve cash flow at the Peru level.
The results of these efforts should be reflected in the coming quarters. We
also refinanced and added working capital debt at the corporate level.
2. PERFORMANCE ON ASSET SALES
In our September 21, 2016 Annual General and Special Shareholders' Meeting,
shareholders approved Special Resolutions that authorized the Board of Directors
to sell "any or all remaining assets of the Corporation in such amounts and at
such times as determined by the Board of Directors".
The Group has been negotiating the sale of a substantial portion of its assets
to a qualified third party purchaser on an exclusive basis over the past several
months. The transaction has not yet been consummated, though definitive
agreements are nearly finalized. Should the parties not reach definitive
agreements in the coming weeks, the Group will endeavor to sell these assets to
other prospective purchasers. The Group has been approached by several other
qualified groups to pursue the acquisition of a similar asset mix. We will
continue to pursue a transaction(s) that will support the best interest of
shareholders according to the shareholder mandate set forth in the September
21, 2016 Special Resolutions.
We will keep you informed of any material events and progress as further
developments take place.
Salomon Guggenheim
Chief Executive Officer and President
September 30, 2017
(1. )Unless otherwise stated, all figures reported herein are in USD and report
the results of those businesses that were continuing as of June 30, 2017 as
compared to those same businesses through the twelve months ended June
30, 2016. The purpose is for the reader to understand the performance of the
Group's continuing businesses.
(2. )"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.
(3. )Net debt equals total borrowings and finance lease obligations less cash,
cash equivalents and other liquid assets.
Group Overview for Half-year 2017
Below is our consolidated profit / (loss) summary for the six months ended June
30, 2017 as compared with the same period of 2016.
(In thousands)
Six months ended
June 30 %
2017 2016 Variance change
Net gaming wins $ 15,198 $ 16,124 $ (926 ) -5.7 %
Food and beverage sales 1,282 1,429 (147 ) -10.3 %
Hospitality and other 1,532 1,923 (391 ) -20.3 %
sales
Total revenues 18,012 19,476 (1,464 ) -7.5 %
Promotional allowances 2,326 2,474 (148 ) -6.0 %
Property, marketing and 12,645 13,777 (1,132 ) -8.2 %
administration
Property EBITDA 3,041 3,225 (184 ) -5.7 %
Corporate Expenses 959 1,723 (764 ) -44.3 %
Adjusted EBITDA 2,082 1,502 580 38.6 %
Property EBITDA as a 11.6 % 7.7 %
percentage of revenues
Depreciation and 1,561 1,514 47 3.1 %
amortization
Interest and financing 1,659 1,697 (38 ) -2.2 %
costs, net
Management fee
attributable to non- 1 2 (1 ) -50.0 %
controlling interest
Foreign exchange loss 29 294 (265 ) -90.1 %
Other gains (98 ) (716 ) 618 -86.3 %
Income taxes 142 143 (1 ) -0.7 %
Loss for the period from $ (1,212 ) $ (1,432 ) $ 220 -15.4 %
continuing operations
Group debt: Below is the Group's Gross debt and Net debt on June 30, 2017.
(In thousands)
Jun-17 Dec-16
Borrowings $ 31,940 $ 28,504
Obligations under leases and hire purchase contracts 466 812
Gross Debt $ 32,406 $ 29,316
Less: cash and cash equivalents (excludes restricted 3,864 1,519
cash)
Net Debt $ 28,542 $ 27,798
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 schedule as follows starting in July 2017:
Princi
pal 2017 2018 2019 2020 2021 2022 There- Total
Balance after
Corp $ 10,710, $ 4,388, $ 1,375,026 $ 1,534,143 $ 1,711,672 $ 151,280 $ - $ 19,871,
orate 505 847 473
586,661 1,461, 1,177,530 1,268,806 1,372,502 1,485,770 4,115,910 11,468,
Peru 586 765
Nicar 198,354 430,681 632,009 181,386 14,963 - - 1,457,
agua 393
Total $ 11,495, $ 6,281, $ 3,184,565 $ 2,984,335 $ 3,099,137 $ 1,637,050 $ 4,115,910 $ 32,797,
520 114 631
Interest There-
Expense 2017 2018 2019 2020 2021 2022 after Total
Corp $ 517,917 $ 748,855 $ 456,979 $ 297,863 $ 120,334 $ 1,387 $ - $ 2,143,335
orate
Peru 450,866 793,803 704,805 611,679 505,449 392,181 422,471 3,881,254
Nicar 72,624 111,273 65,807 13,049 311 - - 263,064
agua
Total $ $ $ $ $ $ $ $
1,041,407 1,653,931 1,227,591 922,591 626,094 393,568 422,471 6,287,653
Interim Consolidated Financial Statements
Financial Statements
THUNDERBIRD RESORTS INC.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(Expressed in thousands of United States dollars)
As of June 30, 2017 and December 31, 2016
-------------------------------------------------------------------------------
June December
30, 2017 31,
2016
Assets
Non-current assets
Property, plant and equipment (Note 7) $ 20,693 $ 21,456
Investment accounted for using the equity method 2,586 2,758
(Note 16)
Intangible assets 5,867 5,912
Deferred tax assets 192 185
Trade and other receivables 1,440 1,566
Due from related parties (Note 13) 42 42
Total non-current assets 30,820 31,919
Current assets
Trade and other receivables 966 792
Due from related parties (Note 13) 1,827 1,804
Inventories 589 480
Restricted cash 1,716 1,348
Cash and cash equivalents 3,864 1,519
Total current assets 8,962 5,943
Total assets $ 39,782 $ 37,862
- Continued -
The accompanying notes in the full Semi-annual report are an integral part of
These interim consolidated financial statements.
THUNDERBIRD RESORTS INC.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION (continued)
(Expressed in thousands of United States dollars)
As of June 30, 2017 and December 31, 2016
-------------------------------------------------------------------------------
June December 31,
30, 2017 2016
Equity and liabilities
Capital and reserves
Share capital (Note 11) 110,611 110,563
Retained earnings (113,341 ) (111,676 )
Translation reserve (5,459 ) (5,429 )
Equity attributable to equity holders of the (8,189 ) (6,542 )
parent
Non-controlling interest 2,634 2,266
Total equity (5,555 ) (4,276 )
Non-current liabilities
Borrowings (Note 9) 16,147 16,005
Obligations under leases and hire purchase 8 10
contracts (Note 10)
Deferred tax liabilities 20 21
Provisions 1,727 1,688
Trade and other payables 464 356
Total non-current liabilities 18,366 18,080
Current liabilities
Trade and other payables 7,928 7,633
Due to related parties (Note 13) 1,480 1,301
Borrowings (Note 9) 15,793 12,499
Obligations under leases and hire purchase 458 802
contracts (Note 10)
Other financial liabilities 527 419
Current tax liabilities (31 ) 442
Provisions 816 962
Total current liabilities 26,971 24,058
Total liabilities 45,337 42,138
Total equity and liabilities $ 39,782 $ 37,862
THUNDERBIRD RESORTS, INC.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(Expressed in thousands of United States dollars)
For the six months ended June 30, 2017
-------------------------------------------------------------------------------
Six months ended
June 30 (unaudited)
2017 2016
Net gaming wins $ 15,198 $ 16,124
Food, beverage and hospitality sales 2,814 3,352
Total revenue 18,012 19,476
Cost of goods sold (7,114 ) (7,965 )
Gross profit 10,898 11,511
Other operating costs
Operating, general and administrative (8,817 ) (10,011 )
Depreciation and amortization (1,561 ) (1,514 )
Other gains and (losses) (Note 5) 98 716
Operating profit 618 702
Share of loss from equity accounted (84 ) (57 )
investments (Note 16)
Financing
Foreign exchange loss (29 ) (294 )
Financing costs (Note 6) (1,747 ) (1,765 )
Financing income (Note 6) 96 75
Other interest (Note 6) (8 ) (7 )
Finance costs, net (1,688 ) (1,991 )
Loss before tax (1,154 ) (1,346 )
Income taxes expense
Current (142 ) (143 )
Deferred - -
Income tax expense (142 ) (143 )
Loss for the year from continuing operations $ (1,296 ) $ (1,489 )
Loss for the year from discontinued operations - (261 )
(Note 8)
Loss for the year $ (1,296 ) $ (1,750 )
-continued-
THUNDERBIRD RESORTS, INC.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (continued)
(Expressed in thousands of United States dollars)
For the six months ended June 30, 2017
-------------------------------------------------------------------------------
Six months ended
June 30 (audited)
2017 2016
Other comprehensive income (amounts, which will
be recycled)
Exchange differences arising on the translation $ (30 ) $ 405
of foreign operations
Other comprehensive income for the year (30 ) 405
Total comprehensive income for the year $ (1,326 ) $ (1,345 )
Gain / (loss) for the year attributable to:
Owners of the parent (1,665 ) (1,878 )
Non-controlling interest 369 128
$ (1,296 ) $ (1,750 )
Total comprehensive income attributable to:
Owners of the parent (1,695 ) (1,473 )
Non-controlling interest 369 128
$ (1,326 ) $ (1,345 )
Basic and diluted loss per share (in $): (Note
12)
Loss from continuing operations (0.07 ) (0.07 )
Loss from discountinued operations - (0.01 )
Total (0.07 ) (0.08 )
THUNDERBIRD RESORTS, INC.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(Expressed in thousands of United States dollars)
For the six months ended June 30, 2017
Attributable to equity holders of parent
Share Share Currency Retained Non- Total
capital options translation earnings Total controlling equity
reserve reserve interest
Balance at
January $ 110,456 $ 89 $ (5,209 ) $ (104,633 ) $ 703 $ 1,911 $ 2,614
1, 2017
Transactions
with owners:
Issue of new 48 - - - 48 - 48
shares
$ 48 $ - $ - $ - $ 48 $ - $ 48
Profit /
(loss) for - - - (1,878 ) (1,878 ) 127 (1,751 )
the year
Other
comprehensive
income
Exchange
differences
arising on
translation
of foreign - - 405 - 405 - 405
operations
Total
comprehensive - - 405 (1,878 ) (1,473 ) 127 )
income for (1,346
the year
Balance at $ 110,504 $ 89 $ (4,804 ) $ (106,511 ) $ (722 ) $ $ 1,316
June 30, 2017 2,038
Transactions
with owners:
Issue of new 59 - - - 59 - 59
shares
Options
cancellation - (89 ) - 89 - - -
and
expiration
$ 59 $ ) $ - $ 89 $ 59 $ - $ 59
(89
Profit /
(loss) for - - - (5,254 ) (5,254 ) 228 (5,026 )
the year
Other
comprehensive
income
Exchange
differences
arising on
translation
of foreign - - (625 ) - (625 ) - (625 )
operations
Total
comprehensive - - (625 ) (5,254 ) (5,879 ) 228 (5,651 )
income for
the year
Balance at
December $ 110,563 $ - $ (5,429 ) $ (111,676 ) $ (6,542 ) $ 2,266 $ (4,276 )
31, 2016
-continued-
THUNDERBIRD RESORTS, INC.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(Expressed in thousands of United States dollars)
For the six months ended June 30, 2017
Share Share Currency Retained Non- Total
capital options translation earnings Total controlling equity
reserve reserve interest
Balance at
January $ 110,563 $ - $ (5,429 ) $ (111,676 ) $ 6,542 $ 2,266 $ (4,276 )
1, 2017
Transactions
with owners:
Issue of new 48 - - - 48 - 48
shares
$ 48 $ $ - $ - $ 48 $ - $ 48
-
Profit /
(loss) for - - - (1,665 ) (1,665 ) 368 (1,297 )
the year
Other
comprehensive
income
Exchange
differences
arising on
translation
of foreign - - (30 ) - (30 ) - (30 )
operations
Total
comprehensive - - (30 ) (1,665 ) (1,695 ) 368 (1,327 )
income for
the year
Balance at $ 110,611 $ - $ (5,459 ) $ (113,341 ) $ (8,189 ) $ 2,634 $ (5,555 )
June 30, 2017
THUNDERBIRD RESORTS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(Expressed in thousands of United States dollars)
For the six months ended June 30, 2017
Six months ended
June 30 (unaudited)
2017 2016
Cash flow from operating activities
Loss for the year $ (1,296 ) $ (1,489 )
Items not involving cash:
Depreciation and amortization 1,561 1,514
Unrealized foreign exchange (297 ) (121 )
Decrease in provision (159 ) (1,186 )
Bad debt expense 14 -
Other losses 29 8
Share based payments 48 48
Finance income (96 ) (75 )
Finance cost 1,747 1,765
Other interests 8 7
Disposal of equity accounted investments - (1,232 )
Results from equity accounted investments 84 57
Tax expenses 142 143
Net change in non-cash working capital items
Decrease / (increase)in trade, prepaid and other 243 (77 )
receivables
(Increase) / decrease in inventory (38 ) 23
Increase in trade payables and accrued 308 1,167
liabilities
Cash (used) from operations 2,298 552
Total tax paid (608 ) (168 )
Net cash generated by continuing operations 1,690 384
Net cash from operating activities $ 1,690 $ 384
Cash flow from investing activities
Expenditure on property, plant and equipment (431 ) (226 )
Proceeds on sale of property, plant and - 1,273
equipment
Proceeds on sale of Costa Rica Joint Venture - 1,534
Interest received 96 75
Net cash used (used) / from investing activities $ (335 ) $ 2,656
Cash flow from financing activities
Proceeds from issue of new loans 13,322 100
Repayment of loans and leases payable (11,050 ) (2,642 )
Interest paid (1,012 ) (1,267 )
Net cash generated / (used) from financing $ 1,260 $ (3,809 )
activities
Net change in cash and cash equivalents during 2,615 (769 )
the year
Cash and cash equivalents, beginning of the year 2,867 4,403
Effect of foreign exchange adjustment 98 6
Cash and cash equivalents, end of the year $ 5,580 $ 3,640
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 following this 2017
Half-year Report. Directors have reviewed the 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 this 2017 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 of third
parties in the acquisition of certain operating assets, and status of genuine
progress and probability of closing within the Going Concern period.
The Directors have also considered certain critical factors that might affect
its continuing operations, as follows:
* Special Resolution: On September 21, 2016, the Group's shareholders
approved a special resolution that, among other items, authorized the Board
of Directors of the Corporate to sell "any or all remaining assets of the
Corporation in such amounts and at such times as determined by the Board of
Directors." This resolution facilitates the sale of any one or any
combination of assets required to support maintaining of a going concern by
the Group.
* Sellable Pricing of Assets; Asset Sale Schedules and Re-financing
Scenarios: The Group now has sufficient market feedback, including offers
for certain key assets, which have enabled the Group to incorporate market-
determined pricing into its models.
* Secured debt Refinancing 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.
* Corporate Expense and Cash Flow: Corporate expense has decreased materially
in recent years, and continues to decrease. Progress in this regard
includes preliminary, unaudited corporate expense in Q4 2016 through Half-
year 2017 of $959 thousand, which is a material reduction from the $1.7
million reported through Half-year 2016.
* Liquidity and Working Capital: The Group is currently operating with low
levels of reserves and working capital. Certain scenarios in relation to
asset sales will not create working capital, while others will. Selling all
or virtually all Group real estate and reverting cash flow will be critical
to creating a healthy level of working capital reserves for periods beyond
the Going Concern period.
* Considering the above, Management and Directors are satisfied that the
consolidated Group has adequate resources to continue as a going concern for
the 12 months following the reporting period of this 2017 Half-year Report.
For these reasons, Management and Directors continue to adopt the going
concern basis in preparing the consolidated financial statements.
Other Group Updates
During the half-year ended June 30, 2017, the Group engaged in the following
listed material events:
Continuing expense reduction including temporary reduction of Officers'
salaries:
i. Corporate expenses: Continuing Corporate Expenses have been further reduced
to less than a $2.0 million annualized run rate as of this Half-year 2017.
ii. Reduction of Officers Salaries and election by Officers to receive shares
in lieu of cash:
In January 2016 the Company implemented a compensation plan for its
officers in order to reduce the Group's cost structure to a level that is
sustainable. The Group was reduced to the following personnel: CEO, CFO
and General Counsel all working full time, but with a continued deferral of
50% or more of their compensation until such time as there are sufficient
cash reserves to pay and/or until such time as these officers receive
shares for their deferred time, which ongoing agreements will be subject to
review by the board's Compensation Committee. These Officers continued to
dedicate full time employment to the Company but discounted a cash portion
of their salaries by approximately $50,000 per month in order to preserve
cash.
This "salary deferral" plan has been re-evaluated on a six months basis and
in each period, beginning July 1 2016, January 1, 2017 and most recently
July 1 2017, the board has assessed and approved the plan based on the
needs of the company on a go-forward basis.
In consideration of the extension of the discounting on the cash portion of
the salaries, Officers have reserved the right to collect unpaid
compensation either through stock at market rate or in cash against future
liquidity events.
The Company last held its AGM and Special meeting of shareholders on
September 22, 2016. The Company's Circular for that AGM/Special Meeting
included a recap of the Company's issued and outstanding shares and a
reference to the "shares for salary deferral" as follows (emphasis in bold
underline form):
"The only shares issued and outstanding in the capital of Thunderbird are
the Common Shares which total 25,054,371 as of the Record Date. Of those
shares, as of the Record Date, the Directors and Senior Officers, as a
group, beneficially own, directly or indirectly, and control 2,721,922
Common Shares which represent approximately 10.9% of the issued Common
Shares of Thunderbird. These Directors and Officers also hold stock options
exercisable for up to 15,334 additional Common Shares of Thunderbird.
Thunderbird purchased 283,972 of its own Shares under its Buy Back Program
in 2013. Thereafter, Thunderbird purchased an additional 710,000 of its own
shares separate and apart from its Buy Back program. The total shares that
are owned by Thunderbird is 993,972. Certain members of Management have
entered into salary deferral arrangement for period January 1 2016 to
December 31, 2016. Under this arrangement which was approved by the
Company's compensation committee and the Board, the Management team has the
option to accept additional shares in lieu of the cash that has been
deferred. The potential number of shares range from approximately 1.5
million to 2.0 million depending on the average share price throughout
2016 and assuming that share prices remain within the average range in
which they have traded over the ninety day period previous to the
publication of this Information Circular. In order to minimize the issuance
of new shares in case Management opts to accept shares in lieu of cash,
Management would first draw down on those 993,972 shares already purchased
by the Company itself."
Effective October 1, 2017, the Company's compensation committee and its board
approved the Officers election to collect unpaid compensation for the period
January 1, 2016 to December 31, 2016 in stock at market rate. This total cash
deferral for 2016 amounted to $505,000. The Officers will collectively receive
a total of approximately 2,533,923 shares. Of this 2,533,923 in shares,
993,972 already purchased by the Company will be transferred by the company pro
rata to the officers in keeping with the Company's Circular for the September
22, 2016 AGM. The balance of 1,539,951 will be issued to the officers as new
shares.
San Diego Federal District Court action and Mitchell Arbitration
In June of 2015, Thunderbird Resorts filed a lawsuit in the Federal District
Court, San Diego, against defendants Murray Jo Zimmer ("Zimmer"), Angular
Investments Corp. ("Angular"), Mitzim Properties, Inc. ("Mitzim Properties")
Taloma Zulu, S.A., ("Taloma Zulu") Jack R. Mitchell, ("Mitchell"). The lawsuit
alleges breach of fiduciary duty against Zimmer, Angular and Mitchell; breach of
contract against defendant Mitchell; aiding and abetting, breach of fiduciary
duty against Taloma Zulu and Mitzim Properties; fraud Civil RICO 18 U.S.C. §
1961, conversion constructive trust and an accounting against defendants Zimmer,
Angular and Taloma Zulu. The basis of the various claims and allegations in the
lawsuit stem from the following: In 2002, Thunderbird partnered with Angular to
operate casinos and related businesses in Costa Rica. Grupo Thunderbird de Costa
Rica, S.A. ("GTCR") was formed by Thunderbird and Angular, who agreed to split
all profits from GTCR on an equal, "50/50" basis. Angular's principal, defendant
Zimmer, became Thunderbird's "country manager" for its operations in Costa Rica.
Between July 2007 and September 2014, Zimmer caused GTCR to pay over $2 million
to defendant Taloma Zulu. Zimmer reported to Thunderbird's management that these
amounts were being paid for legal and consulting expenses for GTCR to operate in
Costa Rica. Upon further investigation, Thunderbird now believes and alleges
that Zimmer and Mitchell caused Thunderbird's 50% share of the amounts paid to
Taloma Zulu to be diverted, misappropriated, embezzled, and/or converted for
defendants' own improper, personal uses. Thunderbird Resorts is seeking the
following relief: awarding Thunderbird the damages it has sustained by reason of
Mitchell, Zimmer et al conduct, and interest thereon as provided by law;
awarding Thunderbird exemplary and/or punitive damages on account of defendants'
willful, wanton, malicious, and/or oppressive conduct; awarding Thunderbird its
costs of suit incurred therein. Thunderbird Resorts is also seeking the
imposition of a constructive trust in favor of Thunderbird, and against
defendants, of the benefits improperly received by defendants and an order
commanding defendants to return to Thunderbird the funds they improperly
received by way of their wrongful conduct. So far, Thunderbird Resorts was
successful in having the court order approximately $420 thousand of the
defendants' funds to be sequestered in the Federal District Court bank account
pending resolution of the case. In March of 2017, Thunderbird Resorts Inc.
obtained a default judgment in the approximate amount of $659 thousand against
co-defendants Angular Investments S.A. and Taloma Zulu.
In May 2017 Mitchell filed a motion to have the claims made against him
submitted to arbitration in Hong Kong alleging that is the proper forum for
Thunderbird Resorts claim. In addition, Angular Investments S.A. filed a motion
to set aside the $659 thousand default judgment. The Court also granted
Thunderbird leave to file additional pleadings showing default damages above
$657,975, and Thunderbird submitted additional pleadings showing damages and
interest totaling $825,125. In addition to Angular's motion to set aside the
default judgment, Angular also filed a motion to dismiss for lack of
jurisdiction which is still under submission. All of these motions and
applications are currently under submission with the Federal District Court. A
pretrial conference in this matter is scheduled for December 4, 2017 to
determine when trial will commence, which could be in December 2017 or within
two to three months after that.
Simultaneously or close thereto with Thunderbird Resorts Inc. filing of the San
Diego Federal District Court case, Mitchell a former employee of Thunderbird,
brought an arbitration claim in Hong Kong under the International Court of
Arbitration of the International Chamber of Commerce against Thunderbird. The
amount claimed is not less than $518 thousand. By way of background, in
September 2012, Thunderbird Resorts entered into a settlement with Mitchell,
following his termination from the company. Part of that settlement included a
payment to Mitchell of approximately $1.8 million to be paid in installments
over the course of several years. On or about May 2015, Thunderbird Resorts
claimed that Mitchell was in default of his settlement agreement and stopped
payment on the settlement amount. Mitchell instituted arbitration proceedings in
Hong Kong pursuant to the terms of the settlement agreement.
On September 27, 2017 the International Court of Arbitration of the
International Chamber of Commerce approved its award against Thunderbird Resorts
Inc. in the approximate amount of $518 thousand plus attorney's fees and costs
of approximately $220,000. The award is not final as the parties are granted
30 days from the date the award is delivered to the parties to file an
application for the correction of an error of the kind or for the interpretation
of an award. Thunderbird Resorts intends to pursue and all legal challenges to
the award including clarification of the award and appeals and challenges to the
award.
Thunderbird Resorts made several request to the Arbitrator that the decision in
this matter be delayed pending submittal of further evidence from the related
matter Thunderbird Resorts Inc. vs. Jo Murray Zimmer, Jack R. Mitchell, Angular
Investments, S.A, Taloma Zulu, Mitzim case no. 15CV1304 JAH BGS filed in the
United States District Court for the Southern District of California in which
Mitchell and his co-defendants are being sued for approximately $1,282,454 plus
punitive damages which may rise to the level of three times the actual damages.
Thunderbird Resorts maintained that justice is best served if the arbitration
proceeding was "stayed" while the Group sought its case against Mitchell and
Zimmer San Diego Federal District Court Case. Thunderbird Resorts is
diligently prosecuting its claims in the Mitchell, Zimmer San Diego Federal
District Court Case and estimates that its monetary value of its claim against
Mitchell is $1,282,454.49. This estimate does not include damages based on other
claims outside the scope of the parties' arbitration agreement, including but
not limited to other claims set forth in Thunderbird Resorts U.S. District Court
action against Mitchell, Murray Jo Zimmer and others.
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.
Contact: Peter LeSar, Chief Financial Officer - Phone: (507) 223-1234 -
Email: plesar(at)thunderbirdresorts.com
Cautionary Notice: Cautionary Notice: The Semi-Annual 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 Semi-Annual 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 Semi-Annual 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.
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: 30.09.2017 - 11:56 Uhr
Sprache: Deutsch
News-ID 561960
Anzahl Zeichen: 50601
contact information:
Town:
El Cangrejo, Apartado
Kategorie:
Business News
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"Thunderbird Resorts 2017 Half-Year (Semi-Annual) Report Filed"
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