Source - RNS
RNS Number : 5204J
Mytrah Energy Ltd
12 September 2016
 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN

 

 

Mytrah Energy Limited

("Mytrah" or the "Company")

 

Interim Results for the six months ended 30 June 2016

 

 

Financial Highlights:

 

·      Revenue of USD 49.66m, an increase of 52% over the comparative period (1H 2015: USD 32.59m)

·      Underlying EBITDA[1] of USD 45.54m up 56% (1H 2015: USD 29.14m); underlying EBITDA margin of 92%

·      In Indian Rupee terms revenue increased by 63%, underlying EBITDA increased by 68%

·      Underlying PBT of USD 2.49m

·      Cash and bank balances of USD 32.20m

·      Signed a new Rupee Term Loan Agreement of INR 25.8 billion (approx. USD 380m) to refinance senior loans from 22 banks across 543 MW of operating wind farms, increasing the credit rating to A, reducing the interest rate by an average of 140 basis points and extending the average maturity of debt by approximately 3 years

·      Secured a direct loan facility of up to USD 175m from Asian Development Bank ('ADB') to help fund the development of a portfolio of new wind and solar projects from Mytrah's pipeline

·      Post period-end, signed a definitive agreement with GE for USD 31m investment

·      Post period-end, Mytrah Energy (India) Private Limited ('MEIPL') has fully repaid the mezzanine debt of USD 14.91m outstanding with PTC India Financial Services Limited ('PFS')

·      Long-term debt sanctions received for 237 MW solar photovoltaic projects

 

Operational Highlights:

 

·      Completed construction and commissioned 295 MW wind projects in the period, taking the operational capacity to 877.9 MW, significantly ahead of the Company's initial target

·      Post period-end added a further 39.3 MW, taking total portfolio to 917.2 MW

·      87 MW assets in construction on track for the upcoming wind season, taking the capacity beyond 1000 MW

·      Signed power purchase agreements ('PPAs') for 422 MW of solar projects till date. Began construction on solar projects in Telangana

·      Signed contracts with tier 1 suppliers for supply of 175MW solar modules and 150MW solar inverters

·      Wind speeds were slightly ahead of expectations in first half

·      Constitution of Indian holding company, Mytrah Energy (India) Limited ('MEIL') was changed to Mytrah Energy (India) Private Limited ('MEIPL')

·      Senior management changes post period-end; introducing separate Chairman and CEO roles

 

[1]After excluding one-off costs relating to write-off of doubtful advances USD 0.42m (1H 2015: USD nil), provision for  doubtful debts included in trade receivables USD 0.10m (1H 2015: USD nil), GBI registration fees USD 0.42m (1H 2015: USD nil). (refer note 5 of financial statements)

 

Commenting on Mytrah's performance, Ravi Kailas, Chairman, said:

 

"We are pleased to report that the performance of our portfolio has been strong in the first half, reflecting the quality of our assets and our focus on driving operational performance. The first half of 2016 saw the commissioning of 295MW, bringing our operating capacity to 877.9MW at the end of the period, which was significantly ahead of our initial target. We have made excellent progress with the construction of our new wind and solar projects and added further wind capacity post period-end, taking our wind portfolio to 917.2 MW. With a further 87 MW of projects currently under construction we are on track to meet our 1000 MW target by mid-2017.

 

"A number of significant milestones were achieved in the period. The USD 380m refinancing and the Asian Development Bank funding were great achievements by Mytrah and are testament to the skill and tenacity of our financing team. Post period-end, one of our subsidiaries has successfully signed a definitive agreement with GE, whereby GE has agreed to invest up to USD 31m to support the development of a 200 MW wind energy project in Andhra Pradesh. Post period-end, MEIPL has fully repaid the mezzanine debt of USD 14.91m outstanding with PTC India Financial Services.

 

"Our new solar business has made sound progress during the period and has secured long term PPAs for 422 MW to date, of which we have achieved financial closure for 237 MW. The Company has also signed contracts with suppliers for the supply of 175MW solar modules and 150MW solar inverters. We look forward to the solar projects progressing through to construction once regulatory and land approvals are completed.

 

"In August we were delighted to strengthen the senior management team by appointing Vikram Kailas and Shirish Navlekar as the Company's Chief Executive Officer and Chief Financial Officer, respectively, which are non-board appointments. The combination of their past experience and successful tenure at Mytrah make them ideal to lead the Company forward.

 

"We delivered a good performance in the first half of 2016 and we will continue to focus on further strengthening the business and improving the quality of our asset performance. Maintaining construction momentum of projects under development and maximising the performance of our operational assets are key priorities. Looking at the second half, we expect that power generation will continue to reflect the good monsoon season across India as well as a strong asset performance. Overall, we are well placed to meet expectations for the full year."

 

For further information please visit www.mytrah.com or contact:

 

Mytrah Energy Limited

Ravi Kailas / Bob Smith        

                             

+44 (0)20 3402 5790

 

Investec Bank plc

Chris Sim / Jeremy Ellis        

                            

+44 (0)20 7597 4000

 

Mirabaud Securities LLP

Peter Krens / Rory Scott                                     

 +44 (0)20 7878 3360

 

 

 

Yellow Jersey PR Limited

Charles Goodwin / Dominic Barretto / Josh Cole  

                   

 +44 (0)7747 788 221

 

 

 

Chairman's Statement:

On behalf of the Board, I am pleased to announce the interim results for Mytrah Energy Limited ("Mytrah" or the "Company", and with the subsidiary companies, the "Group") for the six months period ended 30 June 2016.

 

Projects in operation

 

During the six months ended 30 June 2016 (1H 2016), Mytrah grew its generation capacity to 877.9 MW, a 50% increase over the end of previous year 2015 (2015: 583 MW) and significantly ahead of our initial target. That growth has continued post period-end, taking us to 917.2 MW. Our strategically diversified portfolio, spread across 15 locations and 8 states is working well with good growth in generation from our combined portfolio of assets. Wind power generation was higher during the first six months compared with a year earlier due to additional capacity coming into operation. In addition, the wind has been a little ahead of expectation - as an example, the 543 MW portfolio which operated in 1H 2015, produced 6% more revenue (in rupee terms) in 1H 2016.

 

Projects under construction

 

We expect capacity growth to continue over the next few quarters as we complete the 87 MW of projects currently under construction. As such we expect to meet our target of developing 1,000 MW of operating wind assets by mid 2017.

 

The progress of our wind portfolio since the previous interim results is as follows:

 

Project

Capacity

Substation Progress

Export Line Progress

Wind Turbine Progress

Capacity at 30 June 2015

543 MW

10 plants complete, fully operational & revenue generating

Bhesada

50.4 MW

Plant complete, fully operational & revenue generating

Vajrakarur 2

105 MW

Plant complete, fully operational & revenue generating

Nazeerabad

96.6 MW

Complete & Charged

Complete & Charged

46 turbines commissioned and revenue generating

Nidhi Wind Farms

62.9 MW

Complete & Charged

Complete & Charged

37 turbines commissioned and revenue generating

Nipaniya

20 MW

Complete & Charged

Complete & Charged

10 turbines commissioned and revenue generating

Total

877.9 MW

334.9 MW added in 12 month; capacity growth rate 62%

Additional Capacity Added Post Period End

39.3 MW

Complete & Charged

Complete & Charged

21 turbines erected across the portfolio

Total

917.2 MW

 

Additional 87 MW in construction

Target commissioning mid-2017

70% Complete

60%
Complete

Foundation construction and turbines erection in progress

 

In addition to wind projects, construction of solar projects has started at a number of sites in Telangana and Punjab with substantial land pockets identified. The Company has secured long-term power purchase agreements ('PPA'), for 422 MW in Telangana, Karnataka & Punjab, and already has long-term debt sanctioned for 237 MW. The company remains on track for its renewable energy portfolio to exceed 1,400 MW (c. 1.40 GW) in the medium term. 

 

 

Financial Results

 

Particulars

Six months ended             30 June 2016

Six months ended             30 June 2015

Change

 

USD m

USD m

USD m

Revenue

49.66

32.59

17.07

Other operating income

0.41

0.97

(0.56)

Employee benefits expense

(1.08)

(0.81)

(0.27)

Other expenses

(4.39)

(3.61)

(0.78)

Earnings before interest, tax, depreciation and amortisation (EBITDA)

44.60

29.14

15.46

Depreciation and amortisation charge

(10.23)

(7.20)

(3.03)

Equity settled employee benefits

(1.98)

(0.04)

(1.94)

Operating profit

32.39

21.90

10.49

Finance income

2.97

1.21

1.76

Finance costs

(35.79)

(25.57)

(10.22)

Other finance costs on refinancing

(6.37)

(0.54)

(5.83)

Loss before tax

(6.80)

(3.00)

(3.80)

Income tax credit

1.19

0.53

0.66

Loss after tax

(5.61)

(2.47)

(3.14)

 

 

 

 

Reported EBITDA as above

44.60

29.14

15.46

Non-recurring and non-cash adjustments:

 

 

 

Doubtful advances written-off

                        0.42

                           -  

0.42

Provision for doubtful debts included in trade receivables

                        0.10

                           -  

0.10

GBI registration fee

                        0.42

                           -  

0.42

Total adjustments

0.94

-

0.94

Underlying EBITDA

45.54

29.14

16.40

 

 

 

 

Reported PBT as above

(6.80)

(3.00)

(3.80)

Adjustments as referred above

0.94

-

0.94

Equity settled employee benefits

1.98

0.04

1.94

One-off interest cost on re-financing of existing term loans

6.37

0.54

5.83

Underlying profit before tax

2.49

(2.42)

4.91

 

Revenue

 

The Group's revenue for the six months ended 30 June 2016 was USD 49.66m (1 H 2015: USD 32.59m), an increase in USD 17.07m, reflecting a 52% growth despite depreciation in the average exchange rate between the Indian rupee and US dollar from 62.75 to 67.28 from June 2015 to June 2016. The increase in revenues is primarily on account of capacity additions during the past one year, and better wind resources in 1H.

 

EBITDA

 

The Group has recorded an underlying EBITDA of USD 45.54m for the period ended 30 June 2016 (1H 2015: USD 29.14m) an increase of USD 16.40m, approximately 56% increase (68% in rupee terms), reflecting the increase in revenues.

 

Finance cost

 

Financing costs at USD 42.16m were USD 16.05m higher than the prior year due to increased debt of the recently commissioned capacity leading to higher interest on operating assets commissioned during the past six months, which were under construction during the comparable period last year. 

 

Profit before tax

 

At a consolidated level the Group recorded an underlying profit before tax (PBT) of USD 2.49m during the current period against an underlying loss before tax of USD 2.42m in the corresponding previous period. Increase in underlying PBT in the current period is primarily due to the increased revenues.

 

Taxation

 

The tax credit for the current period was USD 1.19m (1H 2015: USD 0.53m).

 

Earnings per share:

 

Basic and diluted earnings /(loss) per share for the six months ended 30 June 2016 was USD (3.4) cents (1H 2015 USD: (1.08) cents each) each respectively.

 

 

Financial position

 

The net book value of our property, plant and equipment has increased by USD 190m (increase by 24%), all of which relates to investments made during the last six months in the construction of our new plants.

 

 

 Assets

30 June 2016

31 December 2015

 

USD m

USD m

Property, plant and equipment

969.95

779.93

Intangible assets

0.17

0.20

Other investments

5.38

2.06

Other non-current assets

24.68

33.70

Current assets

58.49

28.47

Cash and bank balances including liquid investments

43.00

98.96

Deferred tax assets

8.45

5.74

Total assets

1,100.12

949.06

 

 

Cash flow

 

The cash generated from operations during the period was USD 13.41m (1H 2015: inflow USD 24.26m). Investing activities for the current year resulted in a cash outflow of USD 121.79m (1H 2015: outflow of USD 95.84m). Net financing cash inflows were USD 112.13m (1H 2015: inflows of USD 74.41m). At 30 June 2016 the Group had cash and bank balances of USD 32.20m (31 December 2015: USD 55.58m).

 

Ravi Kailas

Chairman

Mytrah Energy Limited

  

Independent review report to Mytrah Energy Limited

 

We have been engaged by Mytrah Energy Limited ("the Company") to review the condensed consolidated set of interim financial statements in the half-yearly financial report for the six months ended 30 June 2016 which comprises the condensed consolidated income statement, condensed consolidated statement of comprehensive income, condensed consolidated statement of financial position, condensed consolidated statement of changes in equity, condensed consolidated cash flow statement and related notes 1to 33. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements.

 

This report is made solely to the Company in accordance with our engagement letter dated 11 December 2015 and International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board.  Our work has been undertaken so that we might state to the Company those matters we are required to state to it in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusions we have formed.

Directors' responsibilities

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the AIM Rules of the London Stock Exchange.

 

As disclosed in Note 3, the annual financial statements of the company are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of interim financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34, "Interim Financial Reporting," as adopted by the European Union.

Our responsibility

Our responsibility is to express to the Company a conclusion on the condensed set of interim financial statements in the half-yearly financial report based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim Financial Information Performed by the Independent Auditor of the Entity" issued by the Auditing Practices Board for use in the United Kingdom and Ireland. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of interim financial statements in the half-yearly financial report for the six months ended 30 June 2016 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union.

 

 

12 September 2016

 

 

 

KPMG Audit LLC

Chartered Accountants

Heritage Court

41 Athol Street

Douglas

Isle of Man

 

 

 

Condensed consolidated interim income statement for the six months ended 30 June 2016

 

 

 

 

 

 

 

 

Note

 

Six months ended

30 June 2016

Six months ended

30 June 2015

 

 

 

 

 

Continuing operations

 

 

USD

USD

 

 

 

 

 

 

Revenue

4

 

49,659,367

32,591,959

 

Other operating income

4

 

410,011

965,047

 

Employee benefits expense

 

 

(1,080,953)

(808,471)

 

Other expenses

5

 

(4,389,579)

(3,606,771)

 

Earnings before interest, tax, depreciation and amortisation (EBITDA)

 

 

44,598,846

29,141,764

 

Depreciation and amortisation charge

11 & 12

 

(10,234,619)

(7,202,122)

 

Equity settled employee benefits

 

 

(1,979,240)

(35,845)

 

Operating profit

 

 

32,384,987

21,903,797

 

Finance income

6

 

2,971,107

1,209,680

 

Finance costs

7

 

(35,792,568)

(25,573,271)

 

Other finance costs on refinancing

8

 

(6,368,207)

(541,185)

 

Net finance costs

 

 

(39,189,668)

(24,904,776)

 

 

 

 

 

 

 

Loss before tax

 

 

(6,804,681)

(3,000,979)

 

 

 

 

 

 

 

Income tax credit

9

 

1,190,819

525,171

 

 

 

 

 

 

 

Loss for the period from continuing operations

 

 

(5,613,862)

(2,475,808)

 

Loss attributable to

 

 

 

 

 

-Owners of the Company

 

 

(5,613,862)

(1,771,107)

 

-Non-controlling interest

 

 

-  

(704,701)

 

 

 

 

 

 

 

Earnings / (loss) per share

 

 

 

 

 

-Basic

10

 

(0.0343)

(0.0108)

 

-Diluted

10

 

(0.0343)

(0.0108)

 

 

 

 

 

 

 

 

The accompanying notes form an integral part of these condensed consolidated interim financial statements.

 

  

 

Condensed consolidated interim statement of other comprehensive income for the six months ended 30 June 2016

 

 

 

 

 

 

 

 

 

Six months ended

30 June 2016

Six months ended

30 June 2015

 

 

 

 

 

 

 

 

USD

 

USD

Loss for the period

 

 

(5,613,862)

(2,475,808)

 

 

 

 

 

Other comprehensive (loss) / income

 

 

 

 

a)     Items that will never be reclassified to profit and loss

 

 

 

 

        Actuarial gain /(loss) on employment benefit obligations (note 26)

 

 

157,657

(49,921)

 

b)     Items that may be reclassified to profit or loss       

 

 

 

 

        Change in fair value of available-for-sale financial assets (note 26)

 

 

(504,762)

271,276

        Foreign currency translation adjustments (note 26)

 

 

(2,077,770)

313,671

 

 

 

 

 

Total other comprehensive (loss) / income

 

 

(2,424,875)

535,026

 

 

 

 

 

Total comprehensive loss for the period

 

 

(8,038,737)

(1,940,782)

 

 

 

 

 

Total comprehensive loss attributable to

 

 

 

 

-Owners of the Company

 

 

(8,038,737)

(1,236,081)

-Non-controlling interest

 

 

-

(704,701)

 

 

 

 

 

           

 

 

The accompanying notes form an integral part of these condensed consolidated interim financial statements.

 

Condensed consolidated interim statement of financial position as at 30 June 2016

 

 

Note

 

30 June 2016

31 December 2015

 

 

 

USD

USD

Assets

 

 

 

 

Non-current assets

 

 

 

 

Intangible assets

11

 

172,005

195,248

Property, plant and equipment

12

 

969,948,831

779,930,202

Other non-current assets

13

 

24,684,496

33,697,599

Other investments

14

 

5,375,043

2,055,483

Deferred tax assets

15

 

8,451,918

5,744,587

Total non-current assets

 

 

1,008,632,293

821,623,119

Current assets

 

 

 

 

Trade receivables

16

 

30,915,324

17,487,165

Inventories

 

 

259,461

-

Other current assets

17

 

26,134,182

10,986,956

Current tax assets

9

 

1,185,530

-

Current investments

 

 

10,799,907

43,384,798

Cash and bank balances

18

 

32,201,157

55,577,280

Total current assets

 

 

101,495,561

127,436,199

 

 

 

 

 

Total assets

 

 

1,110,127,854

949,059,318

 

 

 

 

 

Liabilities

 

 

 

 

Current liabilities

 

 

 

 

Borrowings

19

 

65,226,312

49,764,216

Finance lease obligations

20

 

218,852

101,165

Trade and other payables

21

 

17,999,291

23,130,462

Retirement benefit obligations

 

 

39,006

33,035

Current tax liabilities

9

 

3,305,830

3,176,482

Total current liabilities

 

 

86,789,291

76,205,360

 

 

 

 

 

Non-current liabilities

 

 

 

 

 

 

 

 

 

Borrowings

19

 

752,129,022

624,433,184

Finance lease obligations

20

 

12,292,659

6,316,717

Other payables

21

 

137,526,905

114,422,081

Derivative financial instruments

22

 

3,403,542

3,429,381

Retirement benefit obligations

 

 

387,845

298,615

Total non-current liabilities

 

 

905,739,973

748,899,978

 

 

 

 

 

Total liabilities

 

 

992,529,264

825,105,338

 

 

 

 

 

Net assets

 

 

117,598,590

123,953,980

 

 

 

 

 

Equity

 

 

 

 

Share capital

24

 

72,858,278

72,858,278

Capital contribution

25

 

16,721,636

16,721,636

Retained earnings

 

 

2,299,191

9,767,315

Other reserves

26

 

(24,985,505)

(26,098,232)

Equity attributable to owners of the Company

 

 

66,893,600

73,248,997

Non-controlling interest

27

 

50,704,990

50,704,983

Total equity

 

 

117,598,590

123,953,980

 

These financial statements were approved by the Board of Directors and authorised for use on 12 September 2016.

Signed on behalf of the Board of Directors by:

 

 

Ravi Kailas                                                          Russell Walls

Chairman                                                              Director

 

 

The accompanying notes form an integral part of these condensed consolidated interim financial statements

 

 

Condensed consolidated interim statement of changes in equity for the six months ended 30 June 2016

 

 

Share capital

Capital contribution

Retained earnings

Non-controlling interests

Other reserves (refer note 26)

Total

 

USD

USD

USD

USD

USD

USD

Balance as at 31 December 2014

72,858,278

16,721,636

15,520,003

55,532,625

(32,100,529)

128,532,013

Loss for the period

-

-

(1,771,107)

(704,701)

-

(2,475,808)

Other comprehensive profit for the period:

 

 

 

 

 

 

Foreign currency translation adjustments

-

-

-

-

          313,671

313,671

Issue of share warrants

-

-

-

-

2,117,528

2,117,528

Creation of debenture redemption reserve 

-

-

(786,497)

-

786,497

-

Actuarial loss on employee benefit obligations

-

-

-

-

(49,921)

(49,921)

Change in fair value of available-for-sale financial investments                                                      

-

-

-

-

271,276

271,276

Purchase of shares from non- controlling interest

-

-

-

(2,345,085)

-

(2,345,085)

Equity settled share based payments

-

-

-

-

125,173

125,173

Balance as at 30 June 2015

72,858,278

16,721,636

12,962,399

52,482,839

(28,536,305)

126,488,847

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as at 31 December 2015

72,858,278

16,721,636

9,767,315

50,704,983

(26,098,232)

123,953,980

Loss for the period

-

-

(5,613,862)

-

-

(5,613,862)

Other comprehensive profit for the period:

 

 

 

 

 

 

Foreign currency translation adjustments

-

-

-

-

(2,077,770)

(2,077,770)

Issue of share to NCI

-

-

-

7

-

7

Tax on payment towards liability component of CCPS

-

-

(423,609)

-

-

(423,609)

Creation of debenture redemption reserve 

-

-

(1,430,653)

-

1,430,653

-

Actuarial loss on employee benefit obligations

-

-

-

-

157,657

157,657

Change in fair value of available-for-sale financial investments                                                  

-

-

-

-

(504,762)

(504,762)

Equity settled share based payments

-

-

-

-

2,106,949

2,106,949

Balance as at 30 June 2016

72,858,278

16,721,636

2,299,191

50,704,990

(24,985,505)

117,598,590

                 

 

 

The accompanying notes form an integral part of these condensed consolidated interim financial statements.

Condensed consolidated interim statement of cash flow for the six months ended 30 June 2016

 

 

 

 

 

Six months ended

30 June 2016

Six months ended

30 June 2015

 

 

 

USD

USD

Cash flow from operating activities

 

 

 

 

Loss before tax

 

 

(6,804,681)

(3,000,979)

Adjustments:

 

 

 

 

Equity settled employee benefits

 

 

1,979,240

35,845

Depreciation and amortisation

 

 

10,234,619

7,202,122

Interest income

 

 

(1,255,679)

(363,125)

Finance costs including other finance costs on refinancing

 

 

42,160,774

26,114,456

Finance lease income

 

 

(223,606)

-

Advances written off

 

 

422,933

-

Provision of trade receivables

 

 

100,722

-

Loss /(Profit) on sale of property, plant and equipment

 

 

211

(2,825)

Gain on disposal of available-for- sale financial investments

 

 

(1,464,920)

(965,214)

Fair valuation of derivative financial instruments

 

 

49,585

156,995

Operating cash flow before working capital changes

 

 

45,199,198

29,177,275

Movements in working capital:

 

 

 

 

Increase in trade receivables and unbilled revenue

 

 

(28,299,120)

(448,353)

Increase in inventories

 

 

(260,725)

-

Increase  in other assets

 

 

(385,101)

(1,255,849)

Decrease in trade and other payables

 

 

(201,133)

(2,575,079)

Cash generated from operations

 

 

16,053,119

24,897,994

Income tax paid

 

 

(2,647,605)

(638,604)

Net cash generated from operating activities (A)

 

 

13,405,514

24,259,390

 

 

 

 

 

Cash flow from investing activities

 

 

 

 

Purchase of property, plant and equipment, net

 

 

(178,199,433)

(79,918,458)

Proceeds from sale / (investment in) mutual funds - net

 

 

32,748,033

(8,224,995)

Deposits (placed) / redeemed with banks

 

 

22,633,306

(8,345,036)

Interest income received

 

 

1,032,074

649,960

Net cash used in investing activities (B)

 

 

(121,786,020)

(95,838,529)

 

 

 

 

 

Cash flow from financing activities

 

 

 

 

Payment towards liability component of CCPS

 

 

(2,504,449)

-

Proceeds from issue of shares to non-controlling interest

 

 

7

-

Purchase of shares from non-controlling interest

 

 

-

(3,378,980)

Proceeds from borrowings

 

 

493,378,680

175,225,288

Proceeds from issue of non-convertible bonds

 

 

-

54,665,096

Repayment of borrowings

 

 

(336,745,127)

(120,867,908)

Interest paid

 

 

(41,998,587)

(31,237,335)

Net cash flow from finance activities (C)

 

 

112,130,524

74,406,161

 

 

 

 

 

Net increase in cash and cash equivalents (A+B+C)

 

 

3,750,018

2,827,022

Cash and cash equivalents at beginning of the period

 

 

5,910,786

5,423,092

Effect of exchange rate fluctuations

 

 

(149,095)

(125,323)

Cash and cash equivalents at end of the period (refer note18)

 

 

9,511,709

8,124,791

           

 

 

Notes to the condensed consolidated interim financial statements for the six months ended 30 June 2016

 

1.   General information

 

Mytrah Energy Limited ("MEL" or the "Company") is a non-cellular company, liability limited by shares, incorporated on 13 August 2010 under the Companies (Guernsey) Law, 2008 and is admitted to trading on Alternate Investment Market, a market operated by the London Stock Exchange plc. The address of the registered office is PO Box 156, Frances House, Sir William Place, St Peter Port, Guernsey, GY1 4EU. The Company has the following subsidiary undertakings, (together the "Group"), all of which are directly or indirectly held by the Company, for which condensed consolidated interim financial statements are being prepared, as set out below:

Subsidiary

Country of incorporation or residence

Date of Incorporation

Proportion of ownership interest / voting power

 

Activity

30 June

2016

31 December 2015

Bindu Vayu (Mauritius) Limited ("BVML")

Mauritius

15 June 2010

100.00

100.00

Investment company

Mytrah Energy (Singapore) Pte. Limited ("MESPL")

Singapore

16 August 2013

100.00

100.00

Investment company

Cygnus Capital (Singapore) Pte. Limited ("CCSPL")1

Singapore

19 March 2014

-

100.00

Investment company

Mytrah Energy Capital Pte. Limited ("MECPL")1

Singapore

10 April 2014

-

100.00

Investment company

Mytrah Energy (India) Private Limited ("MEIPL") (formerly 'Mytrah Energy (India) Limited')

India

12 November 2009

99.99

99.99

Operating company

Bindu Vayu Urja Private Limited ("BVUPL")

India

5 January 2011

99.99

99.99

Operating company

Mytrah Vayu Urja Private Limited ("MVUPL")

India

24 November 2011

99.99

99.99

Operating company

Mytrah Vayu (Pennar) Private Limited ("MVPPL")

India

21 December 2011

99.99

99.99

Operating company

Mytrah Vayu (Gujarat) Private Limited ("MVGPL")

India

24 December 2011

99.99

99.99

Operating company

Mytrah Engineering & Infrastructure Private Limited ("ME&IPL")

India

29 March 2012

99.99

99.99

Operating company

Mytrah Engineering Private Limited ("MEPL")

India

30 March 2012

99.99

99.99

Operating company

Mytrah Vayu (Krishna) Private Limited ("MVKPL")

India

18 June 2012

99.99

99.99

Operating company

Mytrah Vayu (Manjira) Private Limited ("MVMPL")

India

18 June 2012

72.97

72.97

Operating company

Mytrah Vayu (Bhima) Private Limited ("MVBPL")

India

22 June 2012

99.99

99.99

Investment company

Mytrah Vayu (Indravati) Private Limited ("MVIPL")

India

22 June 2012

99.99

99.99

Operating company

Mytrah Power (India) Limited ("MPIL")

India

12 September 2013

99.99

99.99

Operating company

Mytrah Vayu (Godavari) Private Limited ("MVGoPL")

India

21 February 2014

99.99

99.99

Operating company

Mytrah Tejas Power Private Limited ("MTPPL")

India

22 August 2014

99.99

99.99

Operating company

Mytrah Vayu (Som) Private Limited ("MVSPL)

India

30 March 2015

99.99

99.99

Operating company

Mytrah Vayu (Tungabhadra) Private Limited ("MVTPL)

India

30 March 2015

99.99

99.99

Operating company

Mytrah Aadhya Power Private Limited ("MAADPPL")

India

16 July 2015

99.99

99.99

Operating company

 

 

 

 

 

Subsidiary

Country of incorporation or residence

Date of Incorporation

Proportion of ownership interest / voting power

 

Activity

30 June

2016

31 December 2015

Nidhi Wind Farms Private Limited ("NWFPL")2

India

16 July 2010

99.99

99.99

Operating company

Mytrah Aakash Power Private Limited ("MAAKPPL")

India

09 September

 2015

99.99

99.99

Operating company

Mytrah Agriya Power Private Limited ("MAGRPPL")

India

04 January

 2016

99.99

-

Operating company

Mytrah Abhinav Power Private Limited ("'MABHPPL")

India

04 January

 2016

99.99

-

Operating company

Mytrah Adarsh Power Private Limited ("MADAPPL")

India

04 January

 2016

99.99

-

Operating company

Mytrah Advaith Power Private Limited ("MADVPPL")

India

04 January

 2016

99.99

-

Operating company

1 Wound off against application by the Group to concerned authority.

2 Acquired by the Group on 01 August 2015.

 

The principal activity of the Group is to own and operate wind energy farms as a leading independent power producer ("IPP") and to engage in the sale of energy to the Indian market through the Company's subsidiaries.

 

2.   Adoption of new and revised standards and interpretations

 

2.1 New and amended standards adopted during the period:

 

The Group has adopted the following new standards and amendments, including any consequential amendments to other standards with date of initial application of 1 January 2016:

 

Standard or interpretation

Effective for reporting periods starting on or after

IFRS 14 Regulatory Deferral Accounts

Annual periods beginning on or after 1 January 2016

Accounting for Acquisitions of Interests in Joint Operations (Amendments to IFRS 11)

Annual periods beginning on or after 1 January 2016

Clarification of Acceptable Methods of Depreciation and Amortisation (Amendments to IAS 16 and IAS 38)

Annual periods beginning on or after 1 January 2016

Agriculture: Bearer Plants (Amendments to IAS 16 and IAS 41)

Annual periods beginning on or after 1 January 2016

Equity Method in Separate Financial Statements (Amendments to IAS 27)

Annual periods beginning on or after 1 January 2016

Annual Improvements to IFRSs 2012-2014 Cycle - various standards

Annual periods beginning on or after 1 January 2016

Investment Entities: Applying the Consolidated Exception (Amendments to IFRS 10, IFRS 12 and IAS 28)

Annual periods beginning on or after 1 January 2016

Disclosure Initiative (Amendments to IAS 1)

Annual periods beginning on or after 1 January 2016

 

Based on the Group's current business model and accounting policies the adoption of these standards or Interpretations did not have a material impact on the consolidated financial statements of the Group.

 

 

 

 

2.2 New standards and interpretations not yet adopted:

 

At the date of authorisation of these condensed consolidated interim financial statements, the following standards and interpretations, have not been applied in these financial statements, were in issue but not yet effective (and in some cases had not yet been endorsed by the EU). The Group is in the process of evaluating the impact of the following new standard on its consolidated financial statements.

 

IFRS 9 Financial instruments

IFRS 9, published in July 2014, replaces the existing guidance in IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 includes revised guidance on the classification and measurement of financial instruments, including a new expected credit loss model for calculating impairment on financial assets, and the new general hedge accounting requirements. It also carries forward the guidance on recognition and derecognition of financial instruments from IAS 39. IFRS 9 is effective for annual reporting periods beginning on or after 1 January 2018, with early adoption period.

 

IFRS 15 Revenue from Contracts with Customers

IFRS 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. It replaces existing revenue recognition guidance, including IAS 18 Revenue, IAS 11 Construction Contracts and IFRIC 13 Customer loyalty Programmes. IFRS 15 is effective for annual reporting periods beginning on or after 1 January 2018, with early adoption permitted.

 

IFRS 16 Leases

In January 2016, the IASB issued a new standard, IFRS 16, "Leases".  The new standard brings most leases on-balance sheet for lessees under a single model, eliminating the distinction between operating and finance leases. Lessor accounting, however, remains largely unchanged and the distinction between operating and finance leases is retained. IFRS 16 supersedes IAS 17, 'Leases', and related interpretations and is effective for periods beginning on or after January 1, 2019. Earlier adoption of IFRS 16 is permitted if IFRS 15, 'Revenue from Contracts with Customers', has also been applied.

 

Further, the following new  or amended standards are not expected to have a significant impact on the Group's condensed consolidated interim financial statements:

§ Recognition of Deferred Tax Assets for Unrealised Losses (Amendments to IAS 12) is effective on 1 January 2017;

§ Disclosure Initiative (Amendments to IAS 7) is effective on 1 January 2017; and

§ Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (Amendments to IFRS 10 and IAS 28) effective date to be determined.

 

 

3.   Significant accounting policies

 

a)   Basis of preparation

The condensed consolidated interim financial statements of the Group have been presented for the six months ended 30 June 2016 in accordance with IAS 34 'Interim Financial Reporting' as adopted by the European Union.

 

The condensed consolidated interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2015, which have been prepared in accordance with International Financial Reporting Standards ("IFRS's") as adopted by the European Union. The condensed consolidated interim financial statements have been reviewed, not audited and were approved for issue by the Board on 12 September 2016. The financial information contained in this report does not constitute statutory accounts as defined by sections 243-245 of the Companies (Guernsey) Law 2008. A copy of the Group's audited statutory accounts for the year ended 31 December 2015 can be obtained from the Company's website or writing to the Company Secretary. The independent auditor's report on those accounts was unqualified and did not include a reference to any matters which the auditors drew attention by way of emphasis without qualifying the report and did not contain a statement under 263 (3) of the Companies (Guernsey) Law 2008. The condensed consolidated interim financial statements have been prepared on the basis of accounting policies set out in the annual report for the year ended 31 December 2015.

 

Refer note 2 for the new accounting standards/interpretations adopted with an initial application of 1 January 2016.

 

b)   Going concern

The Directors have considered the financial position of the Group, its cash position and the undrawn credit facilities as at the date of these condensed consolidated interim financial statements. The Directors have, at the time of approving the condensed consolidated interim financial statements, a reasonable expectation that the Group has adequate resources to continue its operational existence for a foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing these condensed consolidated interim financial statements.

 

c)   Foreign currencies

These condensed consolidated interim financial statements are presented in United States Dollar ("USD"), which is the presentational currency of the Company, as the financial statements will be used by international investors and other stakeholders as the Company's shares are listed on AIM. The functional currency of the parent company is Pound Sterling ("GBP"). The functional currency of all subsidiaries listed in note 1 is Indian Rupee ("INR"), except for BVML, MESPL, MECPL and CCSPL which are determined as USD.

 

In preparing the financial statements of each individual group entity, transactions in currencies other than the entity's functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.

 

Exchange differences on monetary items are recognised in income statement in the period. For the purposes of presenting condensed consolidated interim financial statements, the assets and liabilities of the Group's foreign operations are translated into US dollars (USD) using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognised in other comprehensive income and accumulated in equity.

 

The exchange rates used to translate the financial information of the subsidiaries into USD were as follows:

 

 

Six months ended

30 June 2016

Six months ended

30 June 2015

Year ended

31 December 2015

USD: INR exchange rates

 

 

 

Closing rate

67.6083

63.6726

66.1261

Average rate

67.2805

62.7491

64.0387

 

 

 

 

USD: GBP exchange rates

 

 

 

Closing rate

1.3393

1.5717

1.4803

Average rate

1.4339

1.5233

1.5283

 

d)   Use of estimates and judgments

In preparing these condensed consolidated interim financial statements, management has made judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.

 

The significant judgments made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied during the year ended 31 December 2015, with the exception of the new standards adopted as per note 2.

 

e)   Measurement of fair value

A number of the Group's accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities. The Group has an established control framework with respect to the measurement of fair values. This includes a valuation team that has overall responsibility for overseeing all significant fair value measurements, including Level 3 fair values, and reports directly to the Chief Financial Officer ("CFO").

 

f)   Change in presentation and analysis of expenses in the income statement

During the previous year, the Group has changed the presentation analysis expenses from function to nature by including 'Earnings before interest, tax, depreciation and amortization' (EBITDA) as a separate line item in the income statement to provide more reliable and more relevant information to the users of financial statements. Management believes that disclosure of expenses by nature is meaningful measure for investors because it provides an analysis of our operating results, ability to service debt and performance of the Company. Further EBITDA is considered by chief operating decision makers to track business evolution, establish operational and strategic targets and make important business decisions. The Company measures EBIDTA on the basis of profit/(loss) from operations. For EBITDA measurement, the Company has not included the depreciation and amortisation expenses, equity settled employee benefits, finance cost, tax expense and other income.

 

 

 

Six months ended

30 June 2016

Six months ended

 30 June 2015

 

 

USD

USD

Revenue

 

49,659,367

32,591,959

Cost of revenue

 

(13,087,477)

(7,981,473)

Gross Profit

 

36,571,890

24,610,486

Other operating income

 

410,011

965,047

Administrative expenses

 

(4,596,914)

(3,671,736)

Operating profit

 

32,384,987

21,903,797

Finance income

 

2,971,107

1,209,680

Finance costs

 

(35,792,568)

 (25,573,271)

Other finance costs on refinancing

 

(6,368,207)

 (541,185)

Net finance cost

 

(39,189,668)

(24,904,776)

Loss before tax

 

(6,804,681)

(3,000,979)

 

Loss for the period has been arrived at after charging:

 

 

 

 

 

Six months ended

30 June 2016

Six months ended

30 June 2015

 

 

USD

USD

Amortisation of intangible assets  (note 11)

 

 

 

-       included in administrative expenses

 

96,408

98,125

Depreciation of property, plant and equipment (note 12)

 

 

 

-       included in cost of revenue

 

9,721,038

6,858,497

-       included in administrative expenses

 

417,173

245,500

Employee costs

 

 

 

-       included in administrative expenses

 

3,060,193

844,316

Other expenses

 

 

 

-       included in cost of revenue

 

3,366,439

1,122,976

-       included in administrative expenses

 

1,023,140

2,483,795

 

 

4.   Revenue

 

The Group's revenue from continuing operations is as follows:

 

 

 

Six months ended

30 June 2016

Six months ended

30 June 2015

 

 

USD

USD

 

 

 

 

Sale of electricity

 

44,660,495

29,387,804

Generation based incentive

 

4,194,665

2,963,405

Sale of renewable energy certificates

                           

795,311

240,750

Sale of verified carbon units

 

8,896

-

Total revenue

 

49,659,367

32,591,959

 

 

 

 

Finance income (note 6)

 

2,971,107

1,209,680

Other operating income

 

410,011

965,047

Total income

 

53,040,485

34,766,686


Generation based incentive are recognised on fulfilment of eligibility criteria prescribed under Indian Renewable Energy Development Agency Limited - Generation Based Incentives Scheme. 

 

 

5.   Other expenses include costs relating to write-off of doubtful advances USD 422,933 (30 June 2015: USD Nil), provision for doubtful debts included in trade receivables USD 100,722 (30 June 2015: USD Nil) and GBI registration fee USD 417,048 (30 June 2015: USD Nil) .

 

6.   Finance income

 

 

Six months ended

30 June 2016

Six months ended

30 June 2015

 

 

USD

USD

Interest income

 

1,255,679

363,125

Loss on derivative instruments within compulsory convertible debentures

 

-

(90,200)

Loss on derivative instruments within compulsory convertible preference shares

 

(49,585)

(66,795)

Finance income on security deposits

 

223,606

-

Gain on disposal of available-for-sale investments

 

1,464,920

965,214

Others

 

76,487

38,336

Total finance income

 

2,971,107

1,209,680

 

7.   Finance costs

 

 

Six months ended

30 June 2016

Six months ended

30 June 2015

 

 

USD

USD

Interest on borrowings

 

(47,540,694)

(33,079,705)

Interest on liability portion of CCPS

 

(247,287)

(265,145)

Other borrowing costs1

 

(2,947,899)

(1,184,906)

Total interest expense

 

(50,735,880)

(34,529,756)

Less: amount included in the cost of qualifying assets2

 

14,943,312

8,956,485

Total finance cost recognised in the income statement

 

(35,792,568)

(25,573,271)

 

 

1Includes finance cost on finance lease obligations USD 555,439 (30 June 2015: USD Nil).

 

2Amounts included in the cost of qualifying assets during the period arose on borrowings sanctioned for the purpose of financing construction of a qualifying asset and it represents the actual borrowing costs incurred on those borrowings, calculated using the effective interest rate method.

 

8.   Other finance costs on refinancing         

 

 

Six months ended

30 June 2016

Six months ended

30 June 2015

 

 

USD

USD

Loan refinancing costs

 

(6,368,207)

(541,185)

Total

 

(6,368,207)

(541,185)

 

Loan refinancing costs represents the cost of prepayment and unamortized transaction costs incurred upon refinancing the existing senior term loans.

 

9.   Taxation

 

 

Six months ended  
 30 June 2016

Six months ended
 30 June 2015

 

 

USD

USD

Current tax/ MAT expense

 

(1,656,257)

(965,115)

Deferred tax benefit (note 15)

 

2,847,076

1,490,286

Income tax expense

 

1,190,819

525,171

 

The Company is exempt from Guernsey income tax under the Income Tax (Exempt bodies) (Guernsey) Ordinance, 1989 and is subject to an annual fee of USD 962. As such, the Company's tax liability is zero. However, considering that the Company's operations are entirely based in India, the effective tax rate of the Group of 17.5% has been computed based on the current tax rates prevailing in India.

 

Indian companies are subject to corporate income tax or Minimum Alternate Tax ("MAT").  If MAT is greater than corporate income tax then MAT is levied.  The Company has recognised MAT/ current tax of USD 1,656,257 (30 June 2015: USD 965,115) as MAT is greater than corporate income tax for the current period. 

 

 

Income tax expense recognised for the period is reconciled to (loss) / profit before tax per the income statement as follows:

 

 

 

Six months ended  
 30 June 2016

Six months ended
 30 June 2015

 

 

USD

USD

Loss before tax

 

(6,804,681)

(3,000,979)

Enacted tax rates

 

34.61%

34.61%

Expected tax expense

 

-

-  

 

 

 

 

Effect of:

 

 

 

Permanent differences

 

1,710,693

525,171

Current tax /MAT expense

 

(1,656,257)

(965,115)

MAT deferred tax credit

 

1,136,383

965,115

Tax credit / (expense)

 

1,190,819

525,171

 

Tax assets / liabilities recognised in the consolidated statement of financial position:

 

 

 

 

 

 

 

 

As at
30 June 2016

As at
31 December 2015

 

 

USD

USD

 

 

 

 

Current tax assets

 

1,185,530

-

 

 

 

 

Current tax liabilities

 

(3,305,830)

3,176,482

 

10. Earnings per share

Basic earnings per share is calculated by dividing profit attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period.

 

 

 

 

Six months ended  

 30 June 2016

Six months ended  

 30 June 2015

 

 

USD

USD

Basic and diluted:

 

 

 

Loss for the period

 

(5,613,862)

(1,771,107)

 

 

 

 

Weighted average number of ordinary shares (basic)

 

163,636,000

163,636,000

Add: Effect of weighted average number of  share options outstanding

 

11,470,345

-

Weighted average number of ordinary shares (diluted)

 

175,106,345

163,636,000

 

 

 

 

Basic earnings /(loss) per share

 

(0.0343)

(0.0108)

Diluted earnings /(loss)  per share

 

(0.0321)

(0.0108)

 

 

11. Intangible assets                                                                                                                                                                          

Intangible assets primarily comprise of application software and is amortised over four years.

 

 

As at                   30 June 2016

As at                     30 June 2015

 

USD

USD

Cost:

 

 

Opening balance

831,983

788,727

Additions during the period

77,353

26,032

Exchange differences

(18,615)

(1,400)

Closing balance

890,721

813,359

 

 

 

Amortisation:

 

 

Opening balance

636,735

460,658

Charge for the period

96,408

98,125

Exchange differences

(14,427)

(2,020)

Closing balance

718,716

556,763

 

 

 

Carrying amount

 

 

As at 30 June 2016 / 30 June 2015

172,005

256,596

As at 31 December 2015 / 31 December 2014

195,248

328,069

12. Property Plant and equipment

 

 

 

Furniture and fittings

Office equipment

Land and buildings

Plant and

Machinery

Computers

Vehicles

Leasehold improvements

Assets under finance lease

Assets under course of construction

Total

 

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

Opening cost as at

1 January 2015

133,711

142,209

1,993,792

500,800,056

247,892

548,823

214,866

6,086,533

26,368,272

536,536,154

Additions

3,711

45,650

-

-

31,542

-

2,401

-

33,142,015

33,225,319

Transfer in / (out)

-

-

136,199

13,832,823

-

-

-

-

(13,969,022)

-

Deletions

(856)

(239)

-

-

(5,921)

(30,984)

-

-

-

(38,000)

Exchange difference

(214)

(843)

(4,558)

(849,512)

(1,093)

(262)

(313)

(7,886)

(305,376)

(1,170,057)

Balance as at 30 June 2015

136,352

186,777

2,125,433

513,783,367

272,420

517,577

216,954

6,078,647

45,235,889

568,553,416

 

 

 

 

 

 

 

 

 

 

 

Accumulated depreciation as at 1 January 2015

73,452

81,024

90,317

25,518,229

182,270

219,825

92,572

168,518

-

26,426,207

Depreciation for the period

12,468

13,352

14,250

6,979,667

28,928

50,945

13,092

154,535

-

7,267,237

Deletions

(856)

(230)

-

-

(5,803)

 (19,480)

-

-

-

(26,369)

Exchange difference

(264)

(295)

(324)

(134,296)

(943)

(741)

(310)

(2,460)

-

(139,633)

Balance as at 30 June 2015

84,800

93,851

104,243

32,363,600

204,452

250,549

105,354

320,593

-

33,527,442

Net book value as at

30 June 2015

51,552

92,926

2,021,190

481,419,767

67,968

267,028

111,600

 

5,758,054

45,235,889

535,025,974

Net book value as at

31 December 2014

60,259

61,185

1,903,475

475,281,827

65,622

328,998

122,294

 

5,918,015

26,368,272

510,109,947

 

 

 

 

 

 

 

 

 

Furniture and fittings

Office equipment

Land and buildings

Plant and

Machinery

Computers

Vehicles

Leasehold improvements

Assets under finance lease

Assets under course of construction

Total

 

USD

USD

USD

USD

USD

USD

USD

USD

USD

USD

Opening cost as at

1 January 2016

149,065

277,224

4,067,974

534,052,840

306,642

543,281

278,207

33,631,173

248,033,551

821,339,957

Additions

10,159

41,694

-

-

106,549

1,772

44,398

22,451,132

195,642,595

218,298,299

Transfer in / (out)

 -  

-

14,159,442

311,975,872

 -  

 -  

 -  

 -  

(326,135,314)

-  

Deletions

 -  

(149)

-

(30,771)

 -  

 -  

 -  

 -  

-

(30,920)

Exchange difference

(3,317)

(6,279)

(157,836)

(13,220,695)

(7,240)

(11,920)

(6,314)

(846,163)

(4,800,451)

(19,060,215)

Balance as at 30 June 2016

155,907

312,490

18,069,580

832,777,246

405,951

533,133

316,291

55,236,142

112,740,381

1,020,547,121

 

 

 

 

 

 

 

 

 

 

 

Accumulated depreciation as at 1 January 2016

94,735

116,740

114,102

38,171,857

223,894

282,140

115,238

2,291,049

-  

41,409,755

Depreciation for the period

17,473

28,336

42,827

9,104,073

30,156

49,342

18,698

924,148

-

10,215,053

Deletions

-  

(81)

-  

(28,848)

-

-

-

-

-  

(28,929)

Exchange difference

(2,162)

(2,696)

(2,709)

(880,880)

(5,055)

(6,425)

(2,617)

(95,045)

-

(997,589)

Balance as at 30 June 2016

110,046

142,299

154,220

46,366,202

248,995

325,057

131,319

3,120,152

-

50,598,290

Net book value as at

30 June 2016

45,861

170,191

17,915,360

786,411,044

156,956

208,076

184,972

 

52,115,990

112,740,381

969,948,831

Net book value as at

31 December 2015

54,330

160,484

3,953,872

495,880,983

82,748

261,141

162,969

31,340,124

248,033,551

779,930,202

 

1.   An amount of USD 14,943,312 (30 June 2015: USD 8,956,485) pertaining to interest on borrowings was capitalized as the funds were used for the construction of qualifying assets (refer note 7).

2.   Summary of depreciation and amortization charge:

 

 

 

Six months ended  

 30 June 2016

Six months ended  

 30 June 2015

 

 

USD

USD

Amortization of intangible assets (refer note 11)

 

96,408

98,125

Depreciation / amortization charge on tangible assets

 

10,215,053

7,267,237

Depreciation and amortization capitalized during the period, net relating to wind farm assets under course of construction

 

(76,842)

(163,240)

Total depreciation and amortization charge

 

10,234,619

7,202,122

                                                                 

13. Other non-current assets

 

 

As at

30 June 2016

As at
31 December 2015

 

 

USD

USD

Deposits

 

6,474,556

6,546,423

Capital advances

 

5,228,779

14,740,851

Prepayments

 

12,981,161

12,410,325

Total other non-current assets

 

24,684,496

33,697,599

 

Deposits mainly comprise of refundable security deposits placed with related parties towards usage of land and power evacuation facilities for a period of 20 years. The difference between the fair value and the nominal value of the deposits has been classified as assets under finance lease.

 

Capital advances represent advance payments made to suppliers and related parties for the construction of wind farm assets, as part of long-term construction and service contracts.

 

Prepayments primarily relate to amounts paid in advance towards lease rentals for lands which have been taken on lease basis from the suppliers of wind turbine generators and related parties for a period ranging up to 20 years and are renewable provided the main lease is renewed by the government authorities and other parties.

 

14. Other investments

 

 

As at

30 June 2016

As at
31 December 2015

 

 

USD

USD

Deposits with banks1

 

5,375,043

2,055,483

Total

 

5,375,043

2,055,483

 

1Represents margin money and fixed deposits placed with banks and financial institutions with maturity period greater than one year.

 

15. Deferred tax assets

The following are the major components of deferred tax liabilities and assets recognized by the Group and movements thereon during the current period.

 

As at

31 December 2015

Recognised
in income

statement

Foreign exchange

As at

30 June 2016

 

USD

USD

USD

USD

Property, plant and equipment

(18,108,667)

(14,481,081)

467,214

(32,122,534)

Provisions for employee benefits

115,021

35,406

(2,693)

147,734

Share issue costs

136,285

(133,947)

(2,338)

-

MAT credit

5,271,060

1,136,383

(121,069)

6,286,374

Unrealised inter-group profits

1,825,516

5,544,202

(66,903)

7,302,815

Tax losses

16,505,372

10,746,113

(413,956)

26,837,529

Net deferred tax asset

5,744,587

2,847,076

(139,745)

8,451,918

 

Deferred tax assets and liabilities are offset where the Group has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) recognized in the consolidate balance sheet:

 

 

 

As at
 30 June 2016

As at
31 December 2015

 

 

USD

USD

 

 

 

 

Deferred tax assets

 

40,574,452

23,853,254

Deferred tax liabilities

 

(32,122,534)

(18,108,667)

Deferred tax asset, net

 

8,451,918

5,744,587

 

 

 

 

16. Trade receivables

 

 

As at
 30 June 2016

As at
 31 December 2015

 

 

USD

USD

 

 

 

 

Trade receivables

 

31,229,617

17,706,023

Less: Provision for impairment of trade receivables

 

(314,293)

(218,858)

Total

 

30,915,324

17,487,165

 

Trade receivables disclosed above are classified as loans and receivables in accordance with IAS 32 and are therefore measured at amortised cost. Trade receivables held by the Group are non-interest bearing and were not collectively impaired or written off.

 

Trade receivables include amounts which are past due at the reporting date but against which the Group has not recognised any allowance for doubtful receivables because there has not been a significant change in credit quality and the amounts are still recoverable. The average age of the receivables was 89 days during the period ended 30 June 2016 (31 December 2015: 86 days). The maximum exposure to credit risk at the reporting date is the carrying value of each customer.

 

The fair value of trade receivables approximates their carrying amounts largely due to the short-term maturities of these instruments and hence management considers the carrying amount of trade receivables to be approximately equal to their fair value. As at 30 June 2016, the Group has 27 customers (31 December 2015: 26 customers).

 

17. Other current assets

 

 

As at
 30 June 2016

As at
 31 December 2015

 

 

USD

USD

 

 

 

 

Deposits

 

270,761

288,263

Accrued interest

 

784,579

574,656

Prepayments

 

1,574,785

991,868

Accrued income

 

19,169,416

5,029,539

Other receivables

 

4,334,641

4,102,630

Total other current assets

 

26,134,182

10,986,956

 

Prepayments primarily relate to amounts paid in advance for lease rentals for land and power evacuation facilities.

 

Accrued income primarily represents amounts receivable from the customer on the sale of electricity and the amount recoverable from the Indian Renewable Energy Development Authority ("IREDA") as generation based incentive but not billed for as at 30 June 2016.

 

Other receivables primarily comprises of advance given to vendors amounting to USD 1,447,268 (31 December 2015: USD 2,958,411).

 

 

18. Cash and bank balances

 

 

As at

 30 June 2016

As at
 
31 December 2015

 

 

USD

USD

Cash on hand

 

311

15

Bank balances

 

9,511,398

5,910,771

Cash and cash equivalents

 

9,511,709

5,910,786

 

 

 

 

Bank deposits

 

22,689,448

49,666,494

Total cash and bank balances

 

32,201,157

55,577,280

 

Bank deposits include margin money deposits of USD 22,689,448 (31 December 2015: USD 43,174,683) placed with banks as security margin against loans taken, letter of credits and bank guarantees issued by banks and financial institution.

 

 

 

19. Borrowings

 

 

As at

30 June 2016

As at
 31 December 2015

 

 

USD

USD

Borrowings at amortised cost

 

 

 

Non-convertible bonds (refer note 1)

 

107,445,804

109,503,048

Compulsorily convertible debentures (refer note 2)

 

16,171,710

16,332,726

Term loans from banks and financial institutions (refer note 3)

 

657,271,892

533,747,671

Working capital loans from banks and financial institutions (refer note 4)

 

36,465,928

14,613,955

Total borrowings

 

817,355,334

674,197,400

 

Amounts due for settlement within 12 months -USD 65,226,312 (31 December 2015: USD 49,764,216)

Amounts due for settlement after 12 months -USD 752,129,022 (31 December 2015: USD 624,433,184)

 

1.     The Company's subsidiary, Mytrah Energy (India) Private Limited ("MEIPL") has issued non-convertible bonds (NCBs) for an amount of ~ USD 113.3 million (INR 7424 million) primarily to  partly finance wind farm projects under construction. The NCBs are listed on the wholesale debt segment of Bombay Stock Exchange, India. The NCBs are repayable at the end of fifth anniversary from the draw-down date and carry a cash coupon of 12% per annum payable on semi-annual basis.

 

The NCBs are secured by collateral support in the form of pledge of 100.00% of the MEIPL's shares held by Bindu Vayu Mauritius Limited ('BVML') and pledge of equity shares held by MEIPL in MVUPL (0.02%), MVPPL (48.99%), MVKPL (48.99%), MVMPL (23.69%), MVBPL (99.98%). Further, hypothecation by way of first and exclusive charge over the monies lying in the designated account and Debt Service Reserve Account       (DSRA) from time to time, and by way of first charge over all receivables arising from the loans disbursed by the MEIPL to MVBPL.

 

As part of financing arrangement, the Group has incurred an amount of USD 1,501,610 as arrangement fees. The Group accounted these costs as transaction cost under IAS 39 and are amortised over the term of NCBs using effective interest rate method. The carrying amount of the liability measured at amortised cost is USD 107,445,804 (31 December 2015: USD 109,503,048).

 

During the year 2014, the Group has issued 8,612,412 warrants to the NCBs investors. These warrants provide an option to the investors to purchase an equivalent number of ordinary shares in Mytrah Energy Limited at a fixed price of GBP 0.7729 based on the Company's share price traded before the day immediately preceding the exercise date of the warrant. The fair value of the warrants as at 31 December 2014 amounted to USD 1,703,053 and was recognised accordingly as derivative financial liability. Further on 30 March 2015, the Group has replaced the warrants issued in 2014 by issuing 11,439,762 new warrants to the investors. These new warrants provide an option to the investors to purchase an equivalent number of ordinary shares in Mytrah Energy Limited at a fixed price of GBP 0.7729. Accordingly the derivative financial liability of USD 1,703,053 relating to existing 8,612,412 warrants has been derecognized during the previous year 2015 and the fair value of the 11,439,762 warrants amounting to USD  2,038,960 is recognised as equity.  

 

2.     During 2012, the Company's subsidiary, MEIL has issued 3,333,333 compulsory convertible debentures ("CCDs") at INR 300 (~ USD 5.71) each to PTC India Financial Services Limited (PFS) including any of its affiliates (the "Investor") amounting to USD 18,285,211 under an agreement between the Group and PFS. The purpose of this is to fund the capital projects of the Group. The following are the significant terms in relation to the CCDs:

 

·    The CCDs carry a fixed rate of interest payable quarterly in arrears on the principal amount of the CCDs outstanding.

 

·    The CCDs, along with unpaid interest, if any, mandatorily convert into such number of equity shares of MEIPL at the end of 49 months from the date of initial disbursement so as to provide the investor a stated rate of return.

 

·    The CCDs are secured by collateral support in the form of pledge of 48.98% shares of Bindu Vayu Urja Private Limited ("BVUPL") held by MEIPL.

 

 

Further, the agreement states that PFS can put the CCDs (the "put option") or alternatively, MEIPL can call the CCDs (the "call option") in exchange for cash providing PFS a stated rate of return. The call option can be exercised any time from the date of issue whereas the put option can be exercised over a period beginning from 41 months to 47 months from the date of issue of CCDs. In accordance with the terms of the agreement, PFC has exercised the put option on the CCDs and accordingly the Company has redeemed the entire CCDs on 22 July 2016.

 

3.     The Group has drawn down the term loan facility with banks and financial institutions to finance the construction of wind farm assets. The carrying amount of the liability measured at amortised cost is USD 657,271,891 (31 December 2015: USD 533,747,671). The repayment terms of the term loans range from 13 to 18 years. In compliance with the terms of the loan agreement, the Group has created a charge on all project movable, immovable properties, cash flows, receivables and revenues in favour of banks and financial institutions.

 

Further, the loan drawn down by BVUPL, MVPPL, MVUPL, MVKPL and MVMPL is secured by way of first charge on the pledge of shares held by MEIPL in the equity shares representing 51% of the total paid up equity share capital of the BVUPL, MVPPL, MVUPL, MVKPL and MVMPL respectively. The loan drawn by MVMPL is also secured by pledge of 51% of the CCPS held by MEIPL in MVMPL. BVUPL, MVPPL, MVMPL, MVUPL and MVKPL are under obligor co-obligor structure. The loan drawn down by MVSPL  is secured by way of first charge on the pledge of shares held by MEIPL in the equity shares representing 100% of the total paid up equity share capital of the MVSPL. The loan drawn down by MVTPL is secured by way of first charge on the pledge of shares held by MEIPL in the equity shares representing 35.27% of the total paid up equity share capital of the MVTPL. The loans drawn down by MVIPL  is secured by way of  first charge on the pledge of shares held by the MVBPL in the equity shares representing 51% of the total paid-up equity share capital of MVIPL. The loan drawn by MVIPL is also secured by pledge of 51% of the CCDS held by MVBPL in MVIPL. The loans drawn down by MVGoPL is secured by way of  first charge on the pledge of shares held by the MVBPL in the equity shares representing 100% of the total paid-up equity share capital of MVGoPL. The loan drawn by MEL is secured by irrevocable and unconditional guarantee from BVML.

 

4.     The working capital loan facilities are secured by way of first charge and hypothecation of entire immovable properties pertaining to the respective projects, both present and future, including movable plant and machinery, machinery spares, tools, accessories, entire project cash flows, receivables, book debts and revenues of the respective entities. The working capital facilities relating to wind farm development activities are secured by way of first pari-passu charge on current assets related to wind farm development activity. The facilities are repayable on a yearly rollover basis and carries interest in the range of 10.20% to 13.15% per annum.

 

20. Finance lease obligations

 

The Group leased the rights to use power evacuation facilities under a lease arrangement . Future finance lease payments due, and their present values, are shown in the following table:

 

Minimum lease payments

Present value of minimum lease payments

 

As at

30 June 2016

As at

31 December 2015

As at

30 June 2016

As at

31 December 2015

 

USD

USD

USD

USD

Not later than one year

1,682,965

871,311

218,852

101,165

Later than one year and not later than five years

6,731,860

3,485,244

1,171,482

541,521

Later than five years

21,947,992

12,198,354

11,121,177

5,775,196

 

30,362,817

16,554,909

12,511,511

6,417,882

Less : future finance charges

17,851,306

10,137,027

 

-

Present value of minimum lease payments

12,511,511

6,417,882

12,511,511

6,417,882

 

 

 

 

 

As at
 30 June 2016

As at
 
31 December 2015

 

 

                       USD

                      USD

Included in :

 

 

 

-Current liabilities

 

218,852

101,165

-Non-current liabilities

 

12,292,659

6,316,717

Total

 

12,511,511

6,417,882

 

 

21. Trade and other payables

 

 

As at

 30 June 2016

As at
 31 December 2015

 

 

USD

USD

 

 

 

 

Current:

 

 

 

Trade payables1

 

4,423,126

10,705,902

Liability component of CCPS2

 

4,141,503

4,234,334

Interest accrued but not due on borrowings

 

7,915,687

5,658,409

Other payables

 

1,518,975

2,531,817

 

 

17,999,291

23,130,462

 

 

 

 

Non-current

 

 

 

Liability component of CCPS

 

288,688

2,160,722

Other payables3

 

137,238,217

112,261,359

 

 

137,526,905

114,422,081

 

1Trade payables relate to amounts outstanding for trade purchases and ongoing costs.     

 

2Liability component of CCPS represents the mandatory preference share dividend payable to IIF, discounted using interest rate implicit in the arrangement. (Refer note 27).

 

3Other payables include payables for purchase of capital assets.

 

The Group has financial risk management policies in place to ensure that all payables are paid within the pre-agreed credit terms. The fair value of trade and other payables approximates their carrying amounts largely due to the short-term maturities of these instruments hence management consider that the carrying amount of trade and other payables to be approximately equal to their fair value.

 

 

22. Derivative financial instruments

 

 

As at

 30 June 2016

As at
 31 December 2015

 

 

USD

USD

Fair value of options embedded in:

 

 

 

Compulsorily convertible preference shares (note 27)

 

3,403,542

3,429,381

Total

 

3,403,542

3,429,381

 

23. Financial instruments - Fair values and risk management

IFRS 13 Fair Value Measurement requires entities to disclose measurement of fair values, for both financial and non-financial assets and liabilities. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

·      Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.

·      Level 2: Inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

·      Level 3: Inputs for the asset or liability that is not based on observable market data (unobservable inputs) 

Financial instruments by category and fair value hierarchy:

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy.

30 June 2016:                                                                                                                                                                                                                                                                                  

 

 

Carrying amount

Fair value

 

Designated at fair value through profit or loss

Loans and receivables

Available-for-sale

Other financial liabilities

Total

Level 1

Level 2

Level 3

 

 

USD

USD

USD

USD

USD

 

USD

USD

USD

 

Financial assets measured at fair value

 

 

 

 

 

 

 

 

 

 

Current investments

-

-

10,799,907

-

10,799,907

 

10,799,907

 

 

 

 

-

-

10,799,907

-

10,799,907

 

10,799,907

 

 

 

Financial assets not measured at fair value

 

 

 

 

 

 

 

 

 

 

Trade receivables (note16)

-

30,915,324

-

-

30,915,324

 

 

 

 

 

Other assets

-

26,699,312

-

-

26,699,312

 

 

 

 

 

Cash and bank balances (note 18)

-

32,201,157

-

-

32,201,157

 

 

 

 

 

Other investments (note 14)

-

5,375,043

-

-

5,375,043

 

 

 

 

 

 

-

95,190,836

-

-

95,190,836

 

 

 

 

 

Financial liabilities measured at fair value

 

 

 

 

 

 

 

 

 

 

Finance lease obligations (note 20)

-

-

-

12,511,511

12,511,511

 

12,511,511

 

 

Derivative financial instruments (note 22)

-

-

-

3,403,542

3,403,542

 

 

3,403,542

 

 

 

-

-

-

15,915,053

15,915,053

 

 

15,915,053

 

 

Financial liabilities not measured at fair value

 

 

 

 

 

 

 

 

 

 

Borrowings (note 19)

-

-

-

817,355,334

817,355,334

 

 

 

 

 

Trade and other payables (note 21)

-

-

-

17,999,291

17,999,291

 

 

 

 

 

Other payables-non-current (note 21)

-

-

-

137,526,905

137,526,905

 

 

 

 

 

 

-

-

-

972,881,530

972,881,530

 

 

 

 

 

                       

Note:

1.     In this table, the Group has disclosed the fair value of each class of financial assets and liabilities in way that permits the information to be compared with the carrying amounts.

2.     For all financial assets and financial liabilities not measured at fair value, the carrying value is a reasonable approximation of fair values.

 

 

 

 

Financial instruments by category and fair value hierarchy:

The following table shows the carrying amounts and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy.

31 December 2015:                                                                                                                                                                                                                                                                        

 

 

Carrying amount

Fair value

 

Designated at fair value through profit or loss

Loans and receivables

Available-for-sale

Other financial liabilities

Total

Level 1

Level 2

Level 3

 

 

USD

USD

USD

USD

USD

 

USD

USD

USD

 

Financial assets measured at fair value

 

 

 

 

 

 

 

 

 

 

Current investments

-

-

43,384,798

-

43,384,798

 

43,384,798

 

 

 

 

-

-

43,384,798

-

43,384,798

 

43,384,798

 

 

 

Financial assets not measured at fair value

 

 

 

 

 

 

 

 

 

 

Trade receivables (note 16)

-

17,487,165

-

-

17,487,165

 

 

 

 

 

Other assets

-

12,438,881

-

-

12,438,881

 

 

 

 

 

Cash and bank balances (note 18)

-

55,577,280

-

-

55,577,280

 

 

 

 

 

Other investments (note 14)

-

2,055,483

-

-

2,055,483

 

 

 

 

 

 

-

87,558,809

-

-

87,558,809

 

 

 

 

 

Financial liabilities measured at fair value

 

 

 

 

 

 

 

 

 

 

Finance lease obligations (note 20)

-

-

-

6,417,882

6,417,882

 

6,417,882

 

 

Derivative financial instruments (note 22)

-

-

-

3,429,381

3,429,381

 

 

3,429,381

 

 

 

-

-

-

9,847,263

9,847,263

 

 

9,847,263

 

 

Financial liabilities not measured at fair value

 

 

 

 

 

 

 

 

 

 

Borrowings (note 19)

-

-

-

674,197,400

674,197,400

 

 

 

 

 

Trade and other payables (note 21)

-

-

-

23,130,462

23,130,462

 

 

 

 

 

Other payables - non-current (note 21)

-

-

-

114,422,081

114,422,081

 

 

 

 

 

 

-

-

-

811,749,943

811,749,943

 

 

 

 

 

                       

 

24. Share capital

 

 

As at

30 June 2016

As at
 31 December 2015

 

 

USD

USD

 

 

 

 

Issued and fully paid up share capital of the Company

 

 

 

163,636,000 ( 31 December 2015 : 163,636,000) ordinary shares with no par value

 

72,858,278

72,858,278

 

The issued share capital refers to ordinary share capital, which carries voting rights with entitlement to an equal share in dividends authorised by the board and in the distribution of the surplus assets of the Company.

 

 

25. Capital contribution

 

 

As at

30 June 2016

As at
 31 December 2015

 

 

USD

USD

 

 

 

 

Opening balance

 

16,721,636

16,721,636

Capital contributions received during the period / year

 

-

-

Closing balance

 

16,721,636

16,721,636

 

During the financial year 2013, the Company's subsidiary, MEIPL entered into an investment agreement with related parties, Mytrah Wind Developers Private Limited ("MWDPL") and Bindu Urja Infrastructure Limited ('BUIL') to issue 40,000,000 Series B Cumulative Compulsorily Redeemable Preference Shares ("RPS") at Rs. 300 (~ USD 5.71) per share and carry a nominal dividend of 0.01% per annum. Pursuant to the agreement, BUIL and MWDPL made long-term non-reciprocal capital contributions ("capital contributions") of USD 16,721,636 as at 30 June 2016, which as per the terms of agreement are not available for distribution as dividend. Management has evaluated that these contributions are in substance in the nature of equity and accordingly classified the amounts received as "Capital Contributions".

 

26. Other reserves

 

Foreign currency translation reserve

Equity- settled- employee- benefits reserve

Fair value reserve

Actuarial valuation reserve

 

Capital redemption reserve

 

Debenture redemption reserve

 

Share warrants

Total other reserves

 

USD

USD

USD

USD

USD

USD

USD

USD

Balance as at 31 December 2014

(36,870,962)

4,003,406

195,253

4,526

567,248

-

-

(32,100,529)

Other comprehensive income for the period:

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

313,671

-

-

-

-

 

-

313,671

Creation of debenture redemption reserve

-

-

-

-

-

786,497

 

786,497

Issue of share warrants 

-

-

-

-

-

-

2,117,528

2,117,528

Actuarial loss on employee benefit obligations

-

-

-

(49,921)

-

-

-

(49,921)

Change in fair value of available-for-sale investments                                                     

-

-

271,276

-

-

-

-

271,276

Equity settled share based payments

-

125,173

-

-

-

-

-

125,173

Balance as at 30 June 2015

(36,557,291)

4,128,579

466,529

(45,395)

567,248

786,497

2,117,528

(28,536,305)

 

 

 

 

 

 

 

 

 

Balance as at 31 December 2015

(40,381,820)

4,744,040

550,420

 

(278,783)

 

1,668,045

 

5,560,906

 

2,038,960

(26,098,232)

Other comprehensive loss for the period:

 

 

 

 

 

 

 

 

Foreign currency translation adjustments

(2,077,770)

-

-

-

-

 

-

(2,077,770)

Creation of debenture redemption reserve

-

-

-

-

-

1,430,653

-

1,430,653

Actuarial (loss)/ gain on employee benefit obligations

-

-

-

157,657

-

-

-

157,657

Change in fair value of available-for-sale investments                                                     

-

-

-

-

-

(504,762)

Equity settled share based payments

-

2,106,949

-

-

-

-

-

2,106,949

Balance as at 30 June 2016

(42,459,590)

6,850,989

45,658

(121,126)

1,668,045

6,991,559

2,038,960

(24,985,505)

 

27. Non-controlling interest

 

 

As at
 30 June 2016

As at
 31 December 2015

 

 

       USD

       USD

A. Compulsorily convertible preference shares (CCPS)

(refer note a)

 

 

 

Balance at beginning of the period / year

 

50,704,975

54,827,924

Purchase of CCPS from non-controlling interest holders

 

-

(2,345,085)

Buy back of CCPS from non-controlling interest holders

 

-

(1,777,864)

Balance at the end of the period / year

 

50,704,975

50,704,975

 

 

 

 

B. Equity shares held by captive customers (refer note b)

 

 

 

Balance at beginning of the period / year

 

-

704,701

Issue of shares to non-controlling interest holders

 

-

77,548

Share of loss attributable to non-controlling interest holders

 

-

(782,249)

Balance at the end of the period /  year

 

-

-

 

 

 

 

B. Equity shares held by others

 

 

 

Balance at beginning of the period / year

 

8

-

Issue of shares to non-controlling interest holders

 

7

8

Balance at the end of the period / year

 

15

8

 

 

 

 

Total (A+B+C)

 

50,704,990

50,704,983

 

a)  Compulsorily convertible preference shares

 

During the year ended 31 March 2012, MEIPL has issued 11,666,566 Series A Compulsorily convertible preference shares (CCPS or 'the shares') at INR 300 (~USD 6) each to India Infrastructure Fund (IIF) under the terms of an Investment Agreement dated 20 June 2011 between the MEIPL, IIF and Mr.Ravi Kailas. The following are the salient features of the CCPS:

 

·    IIF is entitled to receive a preference dividend before any dividends are declared to the ordinary shareholders. These carry a step-up dividend which is cumulative.

 

·    The CCPS convert into equity shares of MEIL at a fixed price of INR 300 (~USD 6) per share, for a fixed number of shares, at the end of six years if the call and put options are not exercised by either of the parties.

 

·    As part of the investment agreement, IIF were issued with 100 ordinary shares in MEIPL.

 

Further, the Company entered into an option agreement with IIF on the same date whereby the Company can call the CCPS (the "call option") or alternatively, IIF can put the CCPS (the "put option") in exchange for cash or a variable number of shares in the Company providing IIF a stated rate of return. The call option can be exercised at any time after four years three months and the put option can be exercised at any time after five years three months from the date of issue.

 

In accordance with IAS 32, Financial Instruments: Presentation and IAS 39 Financial Instruments: Measurement, upon initial recognition, the issue proceeds has been segregated in the financial statements as mentioned below.

 

The issue proceeds of USD 69,932,181 (net of issue costs of USD 1,891,056) were first attributed to the embedded derivatives, with the fair value of the options amounting to USD 2,670,325. As the instrument entitles the holder to a fixed number of shares the remaining value of the proceeds were bifurcated such that there is a liability component and an equity component. The liability component, being USD 11,866,684 was estimated by discounting the mandatory preference share dividend of six-year cash flows using an interest rate from an equivalent instrument without a conversion feature, with the residual value of USD 55,395,172 representing equity. The effective interest rate on the financial liability is 5.6%. The options are subsequently measured at fair value through profit and loss and the financial liability is subsequently measured at amortised cost. The year-end balance of the options was USD 3,403,542 (31 December 2015: USD 3,429,381) (see consolidated statement of financial position), the liability component of the preference shares was USD 4,430,191 (31 December 2015: USD 6,395,056). The equity component of the CCPS was USD 50,704,975 (31 December 2015: USD 50,704,975) and is recognized as non-controlling interest in these condensed consolidated interim financial statements.

 

 

During the current period, the Group has paid dividend of USD 2,080,840 (30 June 2015: Nil) to IIF and has been reduced from the liability component of CCPS.  

 

In the previous year, the Group has purchased and bought back 583,334 shares from IIF at a premium of INR 300 (USD 9.72). In accordance with the principles enunciated in IAS 32, the Company has reduced face value of the CCPS bought back amounting to USD 4,122,949 from the 'non-controlling interest' and the premium, being the dividend payable over the term of the CCPS, amounting to USD 2,790,287  has been reduced from the liability component of CCPS.

 

b)  Equity shares held by captive customers

 

During the year ended 31 December 2014, MVMPL has commissioned a captive power generating plant in Tamilnadu, India under Captive Group Project ("CGP") framework, where the electricity generated is consumed by a group of consumers. To qualify as a captive generating plant, an entity must meet the requirements set forth under the relevant regulations, which specify that a minimum 26% equity interest in the captive generating plant should be held by a Captive Consumers or group of Captive Consumers. Accordingly, MVMPL has entered into power purchase agreements (PPA) with Captive Consumers and issued 4,729,840 equity shares of INR 10 par value  (USD 782,249). The shares issued to the captive consumers have been classified as non-controlling interest in these condensed consolidated  interim financial statements.

 

28. Commitments

 

 

 

As at
 30 June 2016

As at
31 December 2015

 

 

USD

USD

 

 

 

 

Capital commitments

 

140,852,858

269,788,515

 

The capital expenditures authorised and contracted primarily relate to wind farm assets under construction, which have not been provided for in the condensed consolidated interim financial statements. These commitments are net of advances paid of USD 5,228,779 (31 December 2015: USD 14,740,851) (refer note 13).

 

 

29. Related party transactions

A.    Related party relationships:

 

Balances and transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated upon consolidation and are not disclosed in this note. Details of transactions between the Group and other related parties are disclosed below.

 

The following are the key management personnel of the Company:

 

1.       Mr Ravi Kailas

-   Chairman and Director#

2.       Mr Vikram Kailas

-   Chief Executive Officer*

3.       Mr Rohit Phansalkar

-   Non-Executive Director

4.       Mr Russell Walls

-   Non-Executive Director

 

The entities where certain key management personnel have significant influence with which the Group had transactions during the period are:

 

1.     Bindu Urja Infrastructure Limited

2.     Mytrah Wind Developers Private Limited

 

# Chief Executive Officer up to 8 August 2016

*Appointed as Chief Executive Officer from 9 August 2016

 

B.    Related party transactions:

 

The following are the related party transactions during the period:

 

 

Six months ended
 30 June 2016

Six months ended
 30 June 2015

 

USD

USD

Advance to related parties towards development and construction of wind farm projects:

 

 

Bindu Urja Infrastructure Limited

1,620,016

2,194,937

 

 

 

Purchase towards development and construction of wind farm projects:

 

 

Bindu Urja Infrastructure Limited

4,228,509

616,583

 

 

 

Deposits placed towards usage of land and power evacuation facilities: 

 

 

Bindu Urja Infrastructure Limited

632,576

2,699,136

 

 

 

User fees paid of land and power evacuation facilities :

 

 

Bindu Urja Infrastructure Limited

2,427,351

 261,239

 

 

 

 

C.    Related party balances:

 

The following balances were outstanding at the end of the reporting period:

 

As at
 30 June 2016

As at
 31 December 2015

 

USD

USD

Advance recoverable from related parties towards development and construction of wind farm projects:

 

 

Bindu Urja Infrastructure Limited

1,976,735

7,144,801

 

 

 

Security deposits placed with related parties for use of land and power evacuation facilities: 

 

 

Bindu Urja Infrastructure Limited

20,825,918

20,649,107

Mytrah Wind Developers Private Limited

6,351,843

6,494,218

 

 

 

Other payables

 

 

Bindu Urja Infrastructure Limited

-

1,318,150

 

 

 

Capital contribution received (note 25):

 

 

Bindu Urja Infrastructure Limited

9,904,122

9,904,122

Mytrah Wind Developers Private Limited

6,817,514

6,817,514

 

D. Remuneration of key management personnel:

 

The remuneration of the key management personnel of the Group, is set out below for each of the categories specified in IAS 24 Related Party Disclosures

 

 

Six months ended
 30 June 2016

Six months ended
 30 June 2015

 

 

USD

USD

 

 

 

 

Salaries and other benefits

 

351,305

316,085

Share-based payments (refer note 30)

 

2,228,448

91,020

Total remuneration

 

2,579,753

407,105

 

 

 

 

 

30. Share-based payments

 

The Group has an equity-settled share option scheme for certain directors of the Company and employees in the Group. In addition to the equity-settled share options, the Group makes other minor issues of cash settled options to its certain employees. These cash settled grants do not result in the issuance of common stock and are considered immaterial by the Group. All options have a vesting period over three years. Each share option converts into one ordinary share of the concerned entity on exercise. Options may be exercised at any time from the date of vesting to the date of the expiry. No amounts are paid or payable by the recipient until the receipt of the option. The options carry neither rights to dividends nor voting rights. Options lapse if the employee leaves the concerned entity before the options vest.

 

Mytrah Energy Limited:

During the period, the Company has reissued 11,832,213 share options to directors and group employees at the exercise price of GBP 0.01 by replacing 21,640,058 share options which were issued to directors and group employees at the exercise price of GBP 1.15, GBP 0.75 and GBP 0.772 as the case may be. In accordance with IFRS 2, the Group has charged the incremental fair value of the modified options issued over the vesting period of the options.

 

Details of the share options outstanding at the end of the period / year are as follows.

 

Six months ended

30 June 2016

Year ended

31 December 2015

 

Number of share options

Weighted average exercise price

Number of share options

Weighted average exercise price

 

 

(GBP)

 

(GBP)

Outstanding at beginning of period / year

24,138,758

0.95

14,668,839

1.06

Options granted during the period / year

11,832,213

0.01

9,680,000

0.78

Options cancelled during the period / year

(21,640,058)

0.92

(210,081)

0.77

Options  outstanding at the end of the period / year

14,330,913

0.21

24,138,758

0.95

 

The options outstanding as at 30 June 2016 had a weighted average exercise price of GBP 0.21, and a weighted average remaining contractual life of 3 years and 11 months.

 

The aggregate incremental fair value of the share options reissued during the period was USD 4,472,411. The incremental fair value of options is measured using the Black-Scholes Merton valuation model. Service and non-market performance conditions attached to the arrangements were not taken into account in measuring fair value. Measurement inputs include the following:

 

Weighted average share price (GBP)

 

0.50

Weighted average exercise price (GBP)

 

0.01

Expected volatility

 

43.41%

Expected life

 

3 years

Risk-free interest rate

 

9.36%

 

Expected volatility is determined based on the evaluation of the historical volatility of the Company's share price from the date of listing on 12 October 2010 to the date of issue of options. During the period the Group recognised expense of USD  1,970,500 (net of equity settled employee benefits capitalized USD  32,148) (30 June 2015: USD 35,845 ( net of equity settled employee benefits capitalized USD  89,328) in relation to share-based payment transactions and the unamortised expense as at 30 June 2016 is USD 2,306,823 (31 December 2015: USD 2,681,038).

 

Further, Mr. Ravi Kailas (Chairman) transferred 11,544,989 options, which were granted to him by the Company, to R&H Trust Co (Jersey) Limited on 13 May 2016.

 

Mytrah Energy (India) Private Limited:

During the period, the Company's subsidiary has issued 53,000 options to group employees at the exercise price of INR 1,200 and cancelled 7,750 share options which were issued to group employees at the exercise price of INR 1,200. In accordance with IFRS 2, the Group has charged the fair value of the options issued over the vesting period of the options.

 

Details of the share options outstanding at the end of the period / year are as follows.

 

Six months ended

30 June 2016

Year ended

31 December 2015

 

Number of share options

Weighted average exercise price

Number of share options

Weighted average exercise price

 

 

(INR)

 

(INR)

Outstanding at beginning of period / year

273,450

1,200

-

-

Options granted during the period / year

53,000

1,200

277,450

1,200

Options cancelled during the period / year

(7,750)

1,200

(4,000)

1,200

Options  outstanding at the end of the period / year

318,700

1,200

273,450

1,200

 

The options outstanding as at 30 June 2016 had a weighted average exercise price of INR 1,200. The aggregate fair value of the share options issued during the period was USD 53,774.

 

The fair value of options is measured using the Black-Scholes Merton valuation model. Service and non-market performance conditions attached to the arrangements were not taken into account in measuring fair value. Measurement inputs include the following:

 

Weighted average share price (INR)

 

600

Weighted average exercise price (INR)

 

1,200

Expected volatility

 

42.00%

Expected life

 

3 years

Risk-free interest rate

 

7.59%

 

Expected volatility is determined based on the evaluation of the historical volatility of the Holding Company's share price from the date of listing on 12 October 2010 to the date of issue of options. During the period the Group recognised expense of USD 8,740 (net of equity settled employee benefits capitalized USD 94,987) (30 June 2015: USD Nil (net of equity settled employee benefits capitalized USD Nil) in relation to share-based payment transactions and the unamortised expense as at 30 June 2016 is USD 187,422.

 

31. Contingent liabilities

 

The Group is involved in appeals, claims, litigations and other matters that arise from time to time in the ordinary course of business. Following are the details of contingent liabilities not recognised in these condensed consolidated interim financial statements:

 

 

As at 
 30 June 2016

As at 
 31 December 2015

 

USD

USD

 

 

 

a) Indirect tax matters pending in appeal

1,494,568

1,528,068

b) Direct tax matters pending in appeal

833,915

-

c) Guarantees given towards construction and execution of wind power projects

-

903,057

d) Stamp duty litigation

8,127,109

-

 

10,455,592

2,431,125

 

 

32. Other matters

 

During the previous year, one of the supplier of "Wind turbine generator" filed an arbitration application before the High Court of Telangana and Andhra Pradesh ('Honorable High Court') seeking appointment of an arbitrator alleging that MEIPL has breached the terms of an agreement and is liable for liquidated damages. The High Court, accordingly, appointed an Arbitrator and the application was disposed. Subsequently, the Arbitrator appointed by the High Court has passed away. The Company is yet to receive any notice from High Court on any fresh proceedings in this regard. Management has not acknowledged these claims as debts, given the nature of the underlying dispute, allegations between the parties and significant uncertainties relating to the financial claims. Management is evaluating the financial effect and considers that additional disclosure as required under IAS 37 could prejudice the outcome of the case.

 

 

33. Comparatives

 

Previous period's figures have been regrouped / reclassified wherever necessary to correspond with the current period's classification / disclosure.

 


This information is provided by RNS
The company news service from the London Stock Exchange
 
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