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Annual Report and Consolidated Financial Statements
For the period 23 August 2021 to 31 December 2022
DINO FINO FINANCE P.L.C. Annual report and consolidated financial statements
Table of Contents
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STATEMENT OF CONSOLIDATED FINANCIAL POSITION |
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As at 31 December 2022 |
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2022 |
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ASSETS |
Notes |
Euro |
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Non-current assets |
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Investment property |
5 |
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Property, plant and equipment |
6 |
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Goodwill |
4 |
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Deferred tax asset |
8 |
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Receivables |
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Intangible asset |
7 |
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Current assets |
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Inventories |
10 |
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Trade and other receivables |
9 |
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Cash and cash equivalents |
11 |
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Total assets |
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EQUITY AND LIABILITIES |
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Equity |
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Share capital |
13 |
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Shareholder’s loan |
24 |
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Loss for the period |
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Liabilities |
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Non-current liabilities |
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Debt securities in issue |
14 |
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Borrowings |
12 |
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Current liabilities |
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Trade and other payables |
15 |
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Borrowings |
12 |
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Total liabilities |
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---------------- |
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Total equity and liabilities |
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========== |
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The accompanying notes are an integral part of these financial statements. |
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Signed on behalf of the Board of Directors on 28 April 2023 by Mr. Dino Fino (Executive Director) and Mr. Benjamin Muscat (Chairman and Non-Executive Director) as per the Directors' Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Financial Report. |
STATEMENT OF CONSOLIDATED COMPREHENSIVE INCOME |
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For the period 23 August 2021 to 31 December 2022 |
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From 23 August 2021 |
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to |
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31 December 2022 |
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Notes |
Euro |
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Revenue |
16 |
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Cost of sales |
17 |
( |
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Gross profit |
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Other direct costs |
18 |
( |
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Other income |
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Administrative expenses |
( |
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Operating loss |
( |
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Finance costs |
20 |
( |
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---------------- |
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Loss before tax |
( |
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Income tax expense |
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----------------- |
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Loss for the period |
( |
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STATEMENT OF CONSOLIDATED CHANGES IN EQUITY |
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For the period 23 August 2021 to 31 December 2022 |
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Share |
Accumulated |
Shareholder's |
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capital |
losses |
loan |
Total |
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Euro |
Euro |
Euro |
Euro |
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As at 23 August 2021 |
- |
- |
- |
- |
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Issue of share capital |
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- |
- |
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Shareholder’s loan |
- |
- |
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Loss for the period |
- |
( |
- |
( |
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---------------- |
---------------- |
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--------------- |
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As at 31 December 2022 |
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( |
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STATEMENT OF CONSOLIDATED CASH FLOWS |
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For the period 23 August 2021 to 31 December 2022 |
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From 23 August 2021 |
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to |
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31 December 2022 |
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Note |
Euro |
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Operating activities |
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Loss for the period before taxation |
( |
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Adjustments for: |
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Depreciation and amortisation |
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Amortisation of bond issuance costs |
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Finance costs |
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( |
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Working capital changes: |
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Movements in inventories |
( |
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Movement in trade and other receivables |
( |
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Movement in trade and other payables |
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Tax paid |
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Net cash used in operating activities |
( |
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Investing activities |
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Acquisition of investment property |
( |
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Acquisition of intangible assets |
( |
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Acquisition of property, plant and equipment |
( |
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Cash used in investing activities |
( |
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Financing activities |
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Proceeds from bond issuance |
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Payments related to bond issuance |
( |
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Proceeds of bank loan |
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Issue of share capital |
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Capital contribution |
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Payments to related parties |
( |
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Cash generated from financing activities |
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Net movement in cash and cash equivalents |
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Cash and cash equivalents at the beginning of the period |
- |
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Cash and cash equivalents at end of period |
11 |
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Notes to the Consolidated Financial StatementsFor the period 23 August 2021 to 31 December 2022
1. General information
DINO FINO FINANCE P.L.C.
(the "Company")
The principal activity of the Group is to carry on the business of importation, selling, trading in goods and material including household goods, leather goods, upholstery, furnishings and other interior goods.
2.
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7.
8. Deferred tax asset
9.
10.
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12.
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14.
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Independent auditor’s report
To the shareholders of Dino Fino Finance P.L.C.
Report on the audit of the consolidated financial statements
Opinion
We have audited the consolidated financial statements Dino Fino Finance P.L.C. and its subsidiaries (the “Group”), which comprise the consolidated statement financial position as at 31 December 2022, and the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated statement of cash flows for the period then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies and other explanatory information.
In our opinion, the accompanying consolidated financial statements give a true and fair view of the financial position of the Group as at 31 December 2022, and of its financial performance and cash flows for the period then ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union (EU) , and have been properly prepared in accordance with the requirements of the Companies Act, Cap. 386 (the “Act”).
Our opinion is consistent with our additional report to the audit committee.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Group in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) together with the ethical requirements of the Accountancy Profession (Code of Ethics for Warrant Holders) Directive issued in terms of the Accountancy Profession Act, Cap. 281 that are relevant to our audit of the consolidated financial statements in Malta. We have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
In conducting our audit we have remained independent of the Group and have not provided any of the non-audit services prohibited by article 18A of the Accountancy Profession Act, Cap. 281. We have also not provided any non-audit services to the Group during the year ended 31 December 2022.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements of the current period and include the most significant assessed risks of material misstatement (whether or not due to fraud) that we identified. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
We summarise below the key audit matters, together with our response by way of the audit procedures we performed to address those matters in our audit.
Impairment testing of Goodwill in the consolidated financial statements
Key audit matter
Goodwill with a carrying amount of € 3 million as at 31 December 2022 is included in the Group’s Statement of Financial Position at that date.
Management is required to perform an assessment at least annually to establish whether goodwill should continue to be recognised, or if any impairment is required. The assessment was performed at the lowest level at which the Group could allocate and assess goodwill, which is referred to as a cash generating unit (‘CGU’).
The impairment assessment was based on the calculation of a value-in-use the CGU. This calculation was based on estimated future cash flows for the CGU, including assumptions concerning revenue growth, profit margins, weighted average cost of capital and effective tax rates.
Estimating future profitability requires the directors to apply significant judgements which include estimating future taxable profits, long term growth and discount rates. The estimation of future cash flows and the level to which they are discounted is inherently uncertain and requires judgement.
We focused on this area because of the significance of the amount of goodwill which is recognised at balance sheet date. Moreover, the director’s assessment process is complex and highly judgemental and is based on assumptions which are affected by expected future market or economic conditions.
How the key audit matter was addressed in our audit
We evaluated the suitability and appropriateness of the impairment methodology applied by management and engaged our internal valuation specialist resources to assess the reliability of the director’s forecasts and to challenge the methodology used and the underlying assumptions. We concluded that the parameters utilised were reasonable.
We communicated with management and those charged with governance and noted that they were able to provide satisfactory responses to our questions. We also assessed the adequacy of the disclosures made in the note 6 of the consolidated financial statements relating to goodwill including those regarding the key assumptions used in assessing its carrying amount. Those disclosures specifically explain that the directors have assessed the carrying amount of goodwill as at 31 December 2022 to be recoverable and there is no impairment in the value of goodwill.
We have no key observations to report, specific to this matter.
Valuation of intangible assets in the consolidated financial statements
Key audit matter
The Group’s intangible assets having a carrying amount of € 1.85 million as at 31 December 2022 comprise the Intellectual Property and Brand. Details about this asset are given in note 6 of these financial statements. Management determined the fair values of these assets through internal assessments made by the directors by reference to external independent valuations made in previous year. The carrying value of intangible assets was significant in our audit because the amounts are material to the financial statements of the Group.
How the key audit matter was addressed in our audit
We evaluated the suitability and appropriateness of the impairment methodology applied by management and engaged our internal valuation specialist resources to assess the reliability of the director’s forecasts and to challenge the methodology used and the underlying assumptions. We concluded that the parameters utilised were reasonable.
We also assessed the adequacy of the disclosures made in the note 2.10 of the consolidated financial statements relating to intangible assets including those regarding the key assumptions used in assessing their carrying amount. Those disclosures specifically explain that the directors have assessed the carrying amount of intangible assets as at 31 December 2022 to be recoverable and there is no impairment in the value of the intangible assets.
We have no key observations to report, specific to this matter.
Other information
The directors are responsible for the other information. The other information comprises (i) the Directors’ Report and (ii) Corporate Governance – Statement of Compliance which we obtained prior to the date of this auditor’s report, but does not include the consolidated financial statements and our auditor’s report thereon.
Our opinion on the consolidated financial statements does not cover the other information, including the Directors’ report.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
With respect to the directors’ report, we also considered whether the directors’ report includes the disclosures required by Article 177 of the Act.
Based on the work we have performed, in our opinion the information given in the directors’ report for the financial year for which the consolidated financial statements are prepared is consistent with the consolidated financial statements, and the directors’ report has been prepared in accordance with the Act.
In addition, in light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we are required to report if we have identified material misstatements in the directors’ report and other information that we obtained prior to the date of this auditor’s report. We have nothing to report in this regard.
Responsibilities of the directors those charged with governance for the financial statements
The directors are responsible for the preparation of consolidated financial statements that give a true and fair view in accordance with IFRS as adopted by the EU and are properly prepared in accordance with the provisions of the Act and the Gaming Act, and for such internal control as the directors determine is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the directors are responsible for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Group’s financial reporting process.
Auditor’s responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with the ISAs, we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with the relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefit of such communication.
Reports on other legal and regulatory requirements
Report on compliance with the requirements of the European Single Electronic Format Regulatory Technical Standard (the “ESEF RTS”), by reference to Capital Markets Rule 5.55.6
We have undertaken a reasonable assurance engagement in accordance with the requirements of Directive 6 issued by the Accountancy Board in terms of the Accountancy Profession Act (Cap. 281) - the Accountancy Profession (European Single Electronic Format) Assurance Directive (the “ESEF Directive 6”) on the Report and Consolidated Financial Statements of Dino Fino Finance p.l.c. for the year ended 31 December 2022, entirely prepared in a single electronic reporting format.
Responsibilities of the directors
The directors are responsible for the preparation of the Report and Consolidated Financial Statements and the relevant mark-up requirements therein, by reference to Capital Markets Rule 5.56A, in accordance with the requirements of the ESEF RTS.
Our r esponsibilities
Our responsibility is to obtain reasonable assurance about whether the Report and Consolidated Financial Statements and the relevant electronic tagging therein, complies in all material respects with the ESEF RTS based on the evidence we have obtained. We conducted our reasonable assurance engagement in accordance with the requirements of ESEF Directive 6.
Our procedures included:
Opinion
In our opinion, the Report and Consolidated Financial Statements for the period ended 31 December 2022 has been prepared, in all material respects, in accordance with the requirements of the ESEF RTS.
Report on the Statement of Compliance with the Principles of Good Corporate Governance
The Capital Market Rules require the directors to prepare and include in their Annual Report a Statement of Compliance providing an explanation of the extent to which they have adopted the Code of Principles of Good Corporate Governance and the effective measures that they have taken to ensure compliance throughout the accounting period with those Principles.
The Capital Market Rules also require us, as the auditor of the Group, to include a report on the Statement of Compliance prepared by the directors.
We read the Statement of Compliance with the Code of Principles of Good Corporate Governance and consider the implications for our report if we become aware of any apparent misstatements or material inconsistencies with the consolidated financial statements included in the Annual Report. Our responsibilities do not extend to considering whether this statement is consistent with any other information included in the Annual Report.
We are not required to, and we do not, consider whether the Board’s statements on internal control included in the Statement of Compliance with the Code of Principles of Good Corporate Governance cover all risks and controls, or form an opinion on the effectiveness of the Group’s corporate governance procedures or its risk and control procedures.
In our opinion, the Corporate governance statement has been properly prepared in accordance with the requirements of the Capital Market Rules.
Other matters on which we are required to report by exception
We also have responsibilities
We have nothing to report to you in respect of these responsibilities.
Auditor tenure
We were first appointed as auditors of the company on its incorporation on 23 August 2021 and therefore this is the first period of appointment.
The engagement partner on the audit resulting in this independent auditor’s report is Mark Bugeja.
GRANT THORNTON Fort Business Centre Triq L-Intornjatur, Zone 1 Central Business District Birkirkara CBD 1050 Malta
Mark Bugeja Partner
28 April 2023 |