DINO FINO FINANCE
P.L.C.
Annual Report and Separate
Financial Statements
For the year ended 31
December 2023
Company Registration
Number: C 100038
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DINO FINO FINANCE
P.L.C.
Annual report and
separate financial statements
Table of
Contents
Directors' Report
For the year ended 31
December 2023
The directors present
their annual report and the audited separate financial statements
of DINO FINO FINANCE P.L.C. (the ''Company'') for the year ended 31
December 2023. The Company is a registered public limited liability
company under the companies Act (Cap.386) with registration number
C 100038.
Principal
activity
The principal activity
of the Company is to carry on the business of a holding and finance
company. The activities of the Company are expected to remain
consistent in the foreseeable future.
Review of
business
The results for the
period are set out in the statement of comprehensive
income.
Company results and
dividends
During the year under review, the
Company registered a loss after tax of €151,487 (2022:
€202,718). The directors do not recommend the payment of a
dividend.
Directors
The directors of the
Company during the year were:
Mr. Benjamin Muscat -
Independent Non-Executive Director and Chairman
Dr. Austin Gauci Maistre
- Non-Executive Director
Mr. Dino Fino -
Executive Director
Mr. Giuseppe Muscat -
Executive Director
Mr. Joseph Caruana
– Independent Non-Executive Director (appointed 22 April
2024)
Ms. Alexia Farrugia -
Independent Non-Executive Director (resigned 22 April
2024)
The directors have
served on the Board throughout the year and shall continue in
office in accordance with the Company’s Memorandum and
Articles of Association.
Disclosure of
information to auditor
At the date of making
this report, the directors confirm the following:
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As far as each director is aware, there is
no relevant information needed by the independent auditor in
connection with preparing the audit report of which the independent
auditor is unaware, and
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•
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Each director has taken all steps that
he/she ought to have taken as a director in order to make
himself/herself aware of any relevant information needed by the
independent auditor in connection with preparing the audit report
and to establish that the independent auditor is aware of that
information.
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Statement of
directors' responsibilities
The Companies Act (Cap. 386) enacted
in Malta, requires the directors to prepare financial statements
for each financial period which give a true and fair view of the
financial position of the Company as at the end of the financial
period and of the profit or loss for that year. In preparing
these, the directors are required to:
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adopt the going concern
basis unless it is inappropriate to presume that the Company will
continue in the business;
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•
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select suitable
accounting policies and apply them consistently;
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•
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make judgements and
estimates that are reasonable and prudent;
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•
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account for income and
charges relating to the accounting year on the accruals
basis;
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•
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value separately the
components of assets and liability items; and
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report comparative
figures corresponding to those of the preceding accounting
year.
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The directors are responsible for
keeping proper accounting records which disclose with reasonable
accuracy at any time the financial position of the Company and to
enable the directors to ensure that the financial statements comply
with the Companies Act (Cap. 386) enacted in Malta. This
responsibility includes designing, implementing and maintaining
such internal control as the directors determine what is necessary
to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error. The
directors are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.
Statement by the
directors on the financial statements
Pursuant to Capital
Markets Rule 5.68, we, the undersigned, declare that to the best of
our knowledge, the financial statements included in the annual
report are prepared in accordance with the requirements of
International Financial Reporting Standards as adopted by the
European Union, give a true and fair view of the assets,
liabilities, financial position and profit of the Company, and that
this report includes a fair review of the development and
performance of the business and position of the Company, together
with a description of the principal risks and uncertainties that it
faces.
Auditor
The auditor Grant
Thornton Malta has expressed its willingness to hold office and a
resolution proposing its re-appointment will be put before the
members at the annual general meeting.
Signed on behalf of the Board of
Directors on 30 April 2024 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.
Registered
address:
Dino Fino Home +
Contract,
Msida Valley
Road,
Birkirkara, BKR
9025,
Malta
Corporate Governance - Statement of Compliance
For the year ended 31
December 2023
Pursuant to Capital
Markets Rules 5.94 and 5.97 issued by the Malta Financial Services
Authority (the ‘Rules’), Dino Fino Finance P.L.C. (the
‘Company’) should endeavour to adopt the Code of
Principles of Good Corporate Governance contained in Appendix 5.1
to Chapter 5 of the Rules (the ‘Code’), and
accordingly, is hereby reporting on the extent of its adoption of
the Code for the year ended 31 December 2023.
The Company became
subject to the Rules when its bonds were admitted to listing and
subsequent trading on the Malta Stock Exchange, accordingly, this
report covers the year ended 31 December 2023.
The Company acknowledges
that although the Code does not dictate or prescribe mandatory
rules, compliance with the principles of good corporate governance
recommended in the Code is in the best interests of the Company,
its shareholders, bondholders and other stakeholders, and that
compliance with the Code, is not only expected by investors but
also evidences the directors’ and the Company’s
commitment to maintaining a high standard of good
governance.
The Company has only
issued debt securities which have been admitted to trading on the
Malta Stock Exchange, and accordingly, in terms of Rule 5.101, is
exempt from reporting on the matters prescribed in Rules 5.97.1 to
5.97.3, 5.97.6 and 5.97.7 in this corporate governance statement
(the ‘Statement’). It is in the light of this exemption
afforded to the Company by virtue of Rule 5.101, that the directors
of the Company are herein reporting on the corporate governance of
the Company.
The Company confirms
that it has complied with all applicable provisions of the Capital
Markets Rules 5.94 and 5.97 during the year ended 31 December 2023,
in accordance with the following:
The
Board
The Board is responsible
for setting the Company's strategy and overseeing the Company's
financial statements and annual report. The Board carries out these
duties in a way that ensures effective supervision of the Company's
operations and protects the interests of stakeholders, including
bondholders. During the financial year under review, the directors
have provided strong leadership in the direction of the Company and
fulfilled their responsibilities with honesty, competence, and
integrity. Individually and collectively, the directors possess the
necessary skills and experience to contribute effectively to the
Company's decision-making processes and the implementation of its
strategy and policies. The Board is well-informed of the statutory
and regulatory requirements relevant to the Company's business. The
Board is accountable to shareholders and other stakeholders for its
own performance and that of its delegates.
The Chief Executive
Officer (CEO) is a member of the Board, which allows the Board to
be given direct information regarding the Company's performance and
business activities.
The
Company's Chairperson and Chief Executive Officer
The Company has
separated the roles of Chairman and CEO, with each role being
performed by different individuals. The Chairman's responsibility
is to lead the Board and set its agenda. The Chairman ensures that
the Board's discussions on any issue are comprehensive and that all
Directors' opinions are considered, with decisions based on
sufficient and timely information. In addition, the Chairman
oversees the CEO's development of a strategy for subsequent
approval by the Board.
Board
composition
The Board is comprised
of three (3) non-executive directors and two (2) executive
directors, which is within the maximum limit of seven (7) permitted
by the Company's Memorandum of Association. Two of these
non-executive directors are independent from the Company. The Board
has the responsibility for the Group's overall long-term strategy,
as well as the general policies of the Company and its
subsidiaries, including Dino Fino Operations Limited and Dino Fino
Holdings Ltd. The Board is also responsible for monitoring the
Company's control systems and financial reporting, and
communicating effectively with the market when necessary. The
appointment procedures for directors are clearly outlined in the
Company's Articles of Association.
Board
responsibilities
The Board recognises its
legal obligation to manage and administer the Company. In
fulfilling this obligation and acting as stewards of the Company,
the Board takes responsibility for the Company's strategies and
decisions regarding the issuance, servicing, and redemption of its
outstanding bonds, as well as ensuring that its operations comply
with its commitments to bondholders, shareholders, and all
applicable laws and regulations. The Board is also accountable for
ensuring that the Company establishes and implements efficient
internal control and management information systems, as well as
effective communication with the market.
Board
meetings
The directors convene on
a regular basis to evaluate the Company's financial performance and
overall strategy. The company secretary provides notice of the
meetings to the Board members, along with an agenda circulated in
advance of the meeting. During the Board meetings, minutes are
produced to record attendance, and any resolutions passed. The
Chairman guarantees that all relevant issues are included in the
agenda, supported by all available information, and encourages the
presentation of views related to the matter at hand. All directors
are given the opportunity to contribute to the relevant issues on
the agenda. The agenda for the meeting strives to achieve a balance
between addressing long-term strategic goals and short-term
performance issues.
Information and Professional Development
The Board ensures that
each director is informed about the Company's continuous
obligations in accordance with the Companies Act (Cap. 386 of the
Laws of Malta) and the Rules. To facilitate this, the company
secretary, who is responsible for maintaining compliance with Board
procedures and promoting effective communication within the Board
and the Audit Committee, and the Corporate Advisor, who is
responsible for ensuring compliance with the Company's ongoing
obligations as set out in the Rules, provide guidance and
assistance to the directors.
Committees
The Board of Directors
established an Audit Committee that has the role of overseeing the
Board's professional growth, assessing its performance, and
handling conflicts of interest. In addition, conflicts of interest
are managed according to the provisions of the Company's Articles
of Association.
Relations
with bondholders and the market
The Company's Annual
General Meeting is responsible for proposing and approving various
matters in accordance with the Act, such as the Annual Report and
separate Financial Statements, the election of directors and
approval of their fees, the appointment of auditors, and
authorisation of their fees, as well as other special business. In
compliance with the Rules, the Company made several announcements
during the financial year under review to keep bondholders and the
market informed.
Conflicts
of interest
It is the duty of the
directors to always act in the best interest of the Company and its
shareholders and investors. In the event of any actual, potential,
or perceived conflict of interest, the director must declare it
immediately to the other Board members and the Audit Committee, who
will determine if such a conflict exists. The Audit Committee is
responsible for ensuring that any potential conflicts of interest
are resolved in the best interests of the Company. The directors
are regularly reminded of their obligations with regards to dealing
in securities of the Company within the parameters of the law and
subsidiary legislation and Rules. During the financial year in
review, the directors disclosed any private interests or duties
that were unrelated to the Company. It has been ensured that these
do not create any conflicts of interests or duties towards the
Company.
Corporate
Social Responsibility
The Company aims to
follow ethical principles in its management practices and is
dedicated to improving the well-being of all stakeholders of the
Company through Corporate Social Responsibility. The Board
acknowledges its accountability to the community and the
environment in which it operates. The Company also recognises the
importance of preserving the environment and consistently revises
its policies to promote environmental stewardship, social
responsibility, and accountability.
Non-compliance with
the Code
Evaluation of the Board's Performance
The Code suggests the
appointment of a committee led by a non-executive director to
evaluate the performance of the Board. However, the Board does not
view it as essential to establish such a committee, as the
performance of the Board is continuously monitored by the Company's
shareholder.
Remuneration Committee
The Code advises that
the Board should create a policy for the remuneration of directors
and senior executives, as well as formal and transparent procedures
for developing the policy and setting individual remuneration
packages. However, based on the size and nature of the Company's
operations, the Board does not see the need for a separate
remuneration committee. Instead, the Board assumes the
responsibilities of the remuneration committee outlined in
Principle Eight A of the Code, as the remuneration of directors is
not based on performance.
The shareholders in a
general meeting have the authority to approve the maximum annual
aggregate emoluments that can be paid to the Directors, in
accordance with the Company's Memorandum and Articles of
Association.
The remuneration paid to
directors is a fixed amount per annum and does not comprise any
variable component linked to profit sharing, share options, or
pension benefits. The directors are employed with the Company.
Total fees of €54,000 (2022: €67,719) were paid to
directors during the year under review.
Nomination Committee
The Code suggests that a
formal and transparent procedure should be in place for the
appointment of new directors to the Board, which ensures sufficient
information on the candidates' personal and professional
qualifications. However, considering the Company's size and nature
of operations, the Board believes that a nomination committee is
not required.
Institutional Shareholders
The Company does not
have any institutional shareholders.
Signed on behalf of the Board of
Directors on 30 April 2024 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 FINANCIAL POSITION
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As at 31 December
2023
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Notes
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2023
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2022
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EUR
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EUR
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ASSETS
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Non-current
assets
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Investment
property
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4
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5,084,205
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5,190,310
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Intangible
asset
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430
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605
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Investment in
subsidiaries
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5
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4,720,000
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4,720,000
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Trade and other
receivables
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6
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1,705,451
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2,049,435
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11,510,086
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11,960,350
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Current
assets
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Trade and other
receivables
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6
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601,393
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136,130
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Cash and cash
equivalents
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252,132
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53,403
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853,525
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189,533
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Total
assets
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12,363,611
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12,149,883
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EQUITY AND
LIABILITIES
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Equity
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Share capital
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7
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3,620,000
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3,620,000
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Shareholder’s
loan
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16
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980,435
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980,435
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Accumulated
losses
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(354,205)
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(202,718)
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4,246,230
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4,397,717
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Liabilities
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Non-current
liabilities
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Debt securities in
issue
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8
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7,614,237
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7,595,425
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Related party
loan
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245,000
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-
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7,859,237
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7,595,425
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Current
liabilities
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Related party
loan
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125,000
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-
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Trade and other
payables
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9
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133,144
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156,741
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258,144
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156,741
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Total
liabilities
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8,117,381
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7,752,166
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Total equity and
liabilities
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12,363,611
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12,149,883
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The accompanying notes are an
integral part of these financial statements.
Signed on behalf of the Board of
Directors on 30 April 2024 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 COMPREHENSIVE INCOME
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For the year ended 31
December 2023
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Notes
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2023
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From 23 August 2021
to 31 December 2022
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EUR
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EUR
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Revenue
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13
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360,000
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390,000
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Administrative
expenses
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10
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(104,663)
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(118,225)
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Depreciation and
amortisation
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(106,280)
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(115,042)
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Operating
profit
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149,057
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156,733
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Finance income
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11
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89,990
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76,466
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Finance costs
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11
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(390,534)
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(435,917)
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Loss before
tax
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3
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(151,487)
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(202,718)
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Income tax
expense
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12
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-
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-
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Loss for the
year/period
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(151,487)
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(202,718)
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STATEMENT OF
CHANGES IN EQUITY
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For the year ended 31
December 2023
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Note
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Share
capital
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Shareholder's
loan
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Accumulated
losses
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Total
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EUR
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EUR
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EUR
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EUR
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As at 23 August
2021
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-
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-
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-
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-
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Issued share
capital
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7
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3,620,000
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-
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-
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3,620,000
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Loss for the
period
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-
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-
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(202,718)
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(202,718)
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Capitalisation of
loan
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16
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-
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980,435
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-
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980,435
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As at 31 December
2022
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3,620,000
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980,435
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(202,718)
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4,397,717
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As at 1 January
2023
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3,620,000
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980,435
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(202,718)
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4,397,717
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Loss for the
year
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-
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-
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(151,487)
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(151,487)
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As at 31 December
2023
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3,620,000
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980,435
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(354,205)
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4,246,230
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STATEMENT OF CASH FLOWS
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For the year ended 31
December 2023
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Notes
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2023
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From 23 August 2021
to 31 December 2022
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EUR
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EUR
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Operating
Activities
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Loss for the year/period
before tax
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(151,487)
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(202,718)
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Adjustments
for:
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Depreciation and
amortisation
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106,280
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115,042
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Amortisation of bond
issue costs
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18,81
2
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21,163
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Finance costs
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390,534
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414,754
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Finance income
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(89,990)
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(76,466)
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274,149
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271,775
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Working capital
changes:
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Movement in trade and
other receivables
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(31,289)
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(59,664)
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Movement in trade and
other payables
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(23,597)
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156,741
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219,263
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368,852
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Interest paid
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(390,534)
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(414,754)
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Net cash used in
operating activities
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(171,271)
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(45,902)
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Investing
Activities
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Acquisition of investment
property
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|
-
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(5,305,257)
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Acquisition of intangible
assets
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-
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(700)
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Acquisition of
subsidiaries
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-
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(1,100,000)
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Cash used in investing
activities
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|
-
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(6,405,957)
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|
|
|
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Financing
Activities
|
|
|
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Proceeds from bond
issuance
|
|
-
|
7,800,000
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Proceeds from
related party loan
|
|
370,000
|
-
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Payments to related
parties
|
|
-
|
(1,069,000)
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Payments related to bond
issuance
|
|
-
|
(225,738)
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Cash generated from
financing activities
|
|
370,000
|
6,505,262
|
|
|
|
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Net movement in cash
and cash equivalents
|
|
198,729
|
53,403
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Cash and cash equivalents
at start of year / period
|
53,403
|
-
|
Cash and cash
equivalents at end of year / period
|
252,132
|
53,403
|
|
|
|
|
|
|
|
|
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Notes to the Financial Statements
For the year ended 31
December 2023
1.
General information
DINO FINO FINANCE P.L.C.
(the "Company") is a public limited liability company and is
domiciled and incorporated in Malta in terms of the Companies Act
(Cap. 386).
The principal activity
of the Company is to act as a holding company and finance the
operations of its subsidiaries.
2.
Material accounting policies
An entity should
disclose its material accounting policies. Accounting policies are
material and must be disclosed if they can be reasonably expected
to influence the decisions of users of the financial
statements.
Management has concluded
that the disclosure of the entity’s material accounting
policies below and in the succeeding pages are
appropriate.
2.1
Basis of preparation and statement of
compliance
These financial
statements have been prepared in accordance with the International
Financial Reporting Standards (IFRSs) as issued by the
International Accounting Standards Board (IASB) and as adopted by
the EU and the requirements of the Maltese Companies Act (Cap.
386). They have been prepared under the historical cost convention
basis.
2.2
Functional and presentation
currency
The financial statements
are presented in Euro (EUR), which is also the Company's functional
currency.
Transactions in foreign
currencies are translated to the functional currency of the Company
at exchange rates at the dates of the transactions. Monetary
assets and liabilities denominated in foreign currencies at the
reporting date are retranslated to the functional currency at the
exchange rate at that date. The foreign currency gain or loss
on monetary items is the difference between amortised cost in the
functional currency at the beginning of the period, adjusted for
the effective interest and payments during the period, and the
amortised cost in foreign currency translated at the exchange rate
at the end of the period. Foreign currency differences
arising on retranslation are recognised in profit or
loss.
2.3
First time adoption of new and amended
IFRSs
In the current year, the
Company has applied a number of amendments to IFRSs accounting
standards issued by the IASB that are mandatorily effective for an
accounting period that begins on or after 1 January 2023. Their
adoption has not had any material impact on the disclosures, or the
amounts reported in these financial statements.
2.4
IFRSs in issue but not yet
effective
Certain amendments to accounting
standards have been published that are not mandatory for 31
December 2023 reporting periods and have not been early-adopted by
the Company. These amendments are not expected to have a material
impact on the Company in the current or future reporting periods
and on foreseeable future transactions.
2.5
Critical accounting estimates and
judgments
The preparation of
financial statements in conformity with IFRSs requires management
to make judgements, estimates and assumptions that affect the
application of policies and reported amounts of assets,
liabilities, income and expenses. The estimates and associated
assumptions are based on historical experience and various other
factors that are believed to be reasonable and reliable in the
circumstances, the results of which form the basis of making the
judgements about carrying amounts of assets and liabilities that
are not readily apparent from other sources. Actual results may
differ from these estimates.
The estimates and
underlying assumptions are reviewed on an ongoing basis. Revisions
to accounting estimates are recognised in the period in which the
estimate is revised if the revision affects only that period, or in
the period of revision and future periods if the revision affects
both current and future periods.
In the opinion of the
directors, the accounting estimates and judgements made in the
course of preparing these financial statements are not difficult,
subjective or complex to a degree which would warrant their
description as critical in terms of the requirements of IAS 1
(Revised 2007).
2.6
Financial risk management
The Company’s
activities expose it to a variety of financial risks: credit risk,
liquidity risk, market risk (interest rate risk). The
Company’s overall risk management programme focuses on the
unpredictability of financial markets and seeks to minimise
potential adverse effects on the Company’s financial
performance.
(a) Credit
risk
The Company has no
significant concentrations of credit risk. It has policies in
place to ensure that wholesales of products are made to customers
with an appropriate credit history.
(b) Liquidity
risk
Prudent liquidity risk
management implies maintaining sufficient cash and marketable
securities, the availability of funding through an adequate amount
of committed credit facilities and the ability to close out market
positions.
(c) Market risk
(interest rate risk)
The Company closely
monitors changes in market interest rates and explores various
hedging strategies to manage its exposure to interest rate risk. It
may employ interest rate swaps or other derivative instruments to
lessen the impact of fluctuations in interest rates on its
outstanding bonds.
2.7
Financial instruments
Recognition and
derecognition
Financial assets and
financial liabilities are recognised when the Company becomes a
party to the contractual provisions of the financial
instrument.
Financial assets are
derecognised when the contractual rights to the cash flows from the
financial asset expire, or when the financial asset and all
substantial risks and rewards are transferred. A financial
liability is derecognised when it is extinguished, discharged,
cancelled or expires.
Except for those trade
receivables that do not contain a significant financing component
and are measured at the transaction price in accordance with IFRS
15, all financial assets are initially measured at fair value
adjusted for transaction costs (where applicable).
Financial assets are
classified into the following categories:
•
|
amortised
cost
|
•
|
fair value through
profit or loss (FVTPL)
|
•
|
fair value through
other comprehensive income (FVOCI).
|
The Company does not
have any financial assets categorised as FVTPL and FVOCI in the
year/period presented.
The classification is
determined by both:
•
|
the entity’s
business model for managing the financial asset; and
|
•
|
the contractual cash
flow characteristics of the financial asset.
|
All income and expenses
relating to financial assets that are recognised in statement of
comprehensive income are presented within ‘finance
costs’, ‘finance income’ or ‘other
financial items’.
Subsequent
measurement of financial assets
Financial assets at
amortised cost
Financial assets are
measured at amortised cost if the assets meet the following
conditions (and are not designated as FVTPL):
•
|
they are held within a business model
whose objective is to hold the financial assets and collect its
contractual cash flows: and
|
•
|
the contractual terms of the financial
assets give rise to cash flows that are solely payments of
principal and interest on the principal amount outstanding.
|
After initial
recognition, these are measured at amortised cost using the
effective interest method. Discounting is omitted where the effect
of discounting is immaterial. The Company’s cash and
cash equivalents, trade and other receivables, except prepayments,
fall into this category of financial instruments.
IFRS 9’s
impairment requirements use more forward-looking information to
recognise expected credit losses – the ‘expected credit
loss (ECL) model’. Instruments within the scope of the new
requirements included loans and other debt-type financial assets
measured at amortised cost and FVOCI, trade receivables, contract
assets recognised and measured under IFRS 15 and loan commitments
and some financial guarantee contracts (for the issuer) that are
not measured at FVTPL.
Impairment of
financial assets
Recognition of credit
losses is no longer dependent on the Company first identifying a
credit loss event. Instead, the Company considers a broader range
of information when assessing credit risk and measuring expected
credit losses, including past events, current conditions,
reasonable and supportable forecasts that affect the expected
collectability of the future cash flows of the
instrument.
In applying this
forward-looking approach, a distinction is made between:
•
|
financial instruments that have not
deteriorated significantly in credit quality since initial
recognition or that have low credit risk (‘Stage 1’)
and
|
•
|
financial instruments that have
deteriorated significantly in credit quality since initial
recognition and whose credit risk is not low (‘Stage
2’).
|
‘Stage 3’
would cover financial assets that have objective evidence of
impairment at the reporting date.
‘12-month expected
credit losses’ are recognised for the first category while
‘lifetime expected credit losses’ are recognised for
the second category.
Measurement of the
expected credit losses is determined by a probability-weighted
estimate of credit losses over the expected life of the financial
instrument.
Classification and
measurement of financial liabilities
The Company’s
financial liabilities include trade and other payables (except
indirect taxes and withholding tax), related party loan and debt
securities in issue.
Financial liabilities
are initially measured at fair value, and, where applicable,
adjusted for transaction costs unless the Company designates a
financial liability at FVTPL.
Subsequently, financial
liabilities are measured at amortised cost using the effective
interest method except for derivatives and financial liabilities
designated at FVTPL, which are carried subsequently at fair value
with gains or losses recognised in profit or loss (other than
derivative financial instruments that are designated and effective
as hedging instruments).
All interest-related
charges and, if applicable, changes in an instrument’s fair
value that are reported in the statement of comprehensive income
are included within ‘finance costs’ or ‘finance
income’.
Debt securities in issue
are recognised initially at fair value, which is the sum of the
present value of the principal amount and the present value of the
future interest payments.
Debt securities in issue
classified as "held to maturity" are measured at amortised cost,
using the effective interest method, less any impairment losses.
Interest income is recognised using the effective interest rate,
which is the rate that exactly discounts the expected cash flows
through the expected life of the debt securities in
issue.
The fair value of the
debt securities in issue is determined based on market prices or
other valuation techniques, as appropriate.
Offsetting financial
instruments
Financial assets and
liabilities are offset and the net amount reported in the statement
of financial position when there is a legally enforceable right to
set off the recognised amounts and there is an intention to settle
on a net basis, or realise the asset and settle the liability
simultaneously.
2.8
Cash and cash equivalents
Cash and cash
equivalents comprise cash in hand and deposits repayable on demand
less bank balances overdrawn. Bank balances overdrawn that are
repayable on demand and form part of the Company's cash management
are included as a component of cash and cash equivalents for the
purpose of the statement of cash flows.
2.9
Equity and reserves
Ordinary shares are
classified as equity. Incremental costs directly attributable
to issue of ordinary shares are recognised as a deduction from
equity.
Accumulated losses
include current and prior period results.
2.10
Investment property
Investment property
consists of land or buildings held by the Company for the
production of rental income or for capital appreciation, or both.
The Company measures investment property at cost less accumulated
depreciation and any impairment losses.
Investment property is
initially recognised at cost, which includes the purchase price and
any directly attributable costs such as legal fees and brokerage
commissions. After initial recognition, the Company measures
investment property at cost less accumulated depreciation and any
impairment losses. Depreciation is calculated using the
straight-line method over the estimated useful life of the
property, which is determined on an individual property basis. The
estimated useful life of the property is reviewed annually and any
changes in the estimated useful life are accounted for
prospectively.
The carrying amount of
investment property is reviewed for impairment annually, or more
frequently if events or changes in circumstances indicate that the
carrying amount may not be recoverable. Any impairment losses are
recognised in profit or loss.
When the use of a
property changes from investment property to owner-occupied
property, the Company reclassifies the property as property, plant,
and equipment and measures it at cost less accumulated depreciation
and impairment losses. Any difference between the carrying amount
of the investment property and the cost of the property as
owner-occupied property is recognised in profit or loss.
When the use of a
property changes from owner-occupied property to investment
property, the Company measures the property at its fair value and
recognises any gain or loss in profit or loss.
2.11
Investment in subsidiary
A subsidiary is an
entity over which the Company has control, i.e., when the Company
is exposed to, or has rights to, variable returns from its
involvement with the entity and has the ability to affect those
returns through its power to direct the activities of the
entity.
The investment in a
subsidiary is initially recognised at cost, being the fair value of
the consideration given, including acquisition costs, and is
subsequently carried at cost less accumulated impairment losses, if
any.
Dividend income is
recognised when the Company's right to receive payment is
established.
2.12
Revenue recognition
Revenue is measured at
the fair value of the consideration received or receivable for the
services in the ordinary course of the Company's activities.
Revenue is recognised upon the performance of services, and is
stated net of sales tax, returns, rebates and discounts.
Rental
income
The Company earns rental
income from an investment property related to a showroom located in
Dino Fino Home + Contract, Msida Valley Road, Birkirkara BKR 9025,
Malta.
2.13
Impairment
The Company’s
intangible assets, investment in subsidiaries and investment
property are tested for impairment.
The carrying amounts of
the Company’s assets are reviewed at each statement of
financial position date to determine whether there is any
indication of impairment. If any such indication exists, the
asset’s recoverable amount is estimated. The recoverable
amount of an asset is the higher of its fair value less costs to
sell and its value in use.
Whenever the carrying
amount of an asset exceeds its recoverable amount, an impairment
loss is recognised and the carrying amount of the asset is reduced
to its recoverable amount. Impairment losses are recognised
immediately in profit or loss, unless they relate to an asset which
is carried at revalued amount, in which case they are treated as a
revaluation decrease to the extent that the impairment loss does
not exceed the amount in the revaluation surplus for that
asset.
The carrying amounts of
Company’s assets are also reviewed at each statement of
financial position date to determine whether there is any
indication that an impairment loss recognised in prior periods may
no longer exist or may have decreased. If any such indication
exists, the asset’s recoverable amount is estimated. An
impairment loss previously recognised is reversed only if there has
been a change in the estimates used to determine the asset’s
recoverable amount since the last impairment loss was recognised.
When an impairment loss subsequently reverses, the carrying amount
of the asset is increased to the revised estimate of its
recoverable amount, to the extent that it does not exceed the
carrying amount that would have been determined had no impairment
loss been recognised for the asset in prior periods. Impairment
reversals are recognised immediately in profit or loss, unless they
relate to an asset which is carried at revalued amount, in which
case they are treated as a revaluation increase unless an
impairment loss on the same asset was previously recognised in
profit or loss.
2.14
Income taxation
Tax expense recognised
in the statement of comprehensive income comprises the sum of
deferred tax and current tax not recognised in other comprehensive
income or directly in equity.
Current income tax
assets and/or liabilities comprise those obligations to, or claims
from, fiscal authorities relating to the current or prior reporting
periods, that are unpaid at the reporting date. Current tax is
payable on taxable profit, which differs from the statement of
comprehensive income in the financial statements. Calculation of
current tax is based on tax rates and tax laws that have been
enacted or substantively enacted by the end of the reporting
period.
Deferred income taxes
are calculated using the liability method on temporary differences
between the carrying amounts of assets and liabilities and their
tax bases. However, deferred tax is not provided on the initial
recognition of an asset or liability unless the related transaction
affects tax or accounting profit. Deferred tax on temporary
differences associated with shares in subsidiaries and joint
ventures is not provided if reversal of these temporary differences
can be controlled by the Company and it is probable that reversal
will not occur in the foreseeable future.
In addition, tax losses
available to be carried forward are assessed for recognition of
deferred tax assets. Deferred tax assets and liabilities are
calculated, without discounting, at tax rates that are expected to
apply to their respective period of realisation, provided they are
enacted or substantively enacted by the end of the reporting
period.
Deferred tax assets are
recognised to the extent that it is probable that they will be able
to be utilised against future taxable income. Deferred tax
liabilities are always provided for in full. Deferred tax assets
and liabilities are offset only when the Company has a right and
intention to set off current tax assets and liabilities from the
same taxation authority.
Changes in deferred tax
assets or liabilities are recognised as a component of tax income
or expense in the statement of comprehensive income, except where
they relate to items that are recognised in other comprehensive
income or directly in equity, in which case the related deferred
tax is also recognised in other comprehensive income or directly in
equity, respectively.
3.
Loss before tax
Total loss before tax is
stated after charging the following:
|
2023
|
From 23 August 2021
To 31 December 2022
|
|
EUR
|
EUR
|
Depreciation and
amortisation
|
106,280
|
115,042
|
Director's
remuneration
|
54,000
|
67,719
|
Audit fee
|
7,000
|
6,500
|
4.
Investment property
|
|
Building
|
|
|
EUR
|
Period ended 31
December 2022
|
|
|
Opening net book
amount
|
|
-
|
Additions
|
|
5,305,257
|
Depreciation
|
|
(114,947)
|
Net book
amount
|
|
5,190,310
|
|
|
|
Year ended 31 December
2023
|
|
|
Opening net book
amount
|
|
5,190,310
|
Depreciation
|
|
(106,105)
|
Net book
amount
|
|
5,084,205
|
|
|
|
As at 31 December
2023
|
|
|
Cost
|
|
5,305,257
|
Accumulated
depreciation
|
|
(221,052)
|
Net book
amount
|
|
5,084,205
|
|
|
|
The investment property
that is located in Dino Fino Home + Contract, Msida Valley Road,
Birkirkara BKR 9025, Malta, is held under a security trust fund, as
a guarantee in favour of bondholders until such time that these are
repaid in accordance with the Company Admission
Document.
5.
Investment in subsidiaries
The carrying amount of investment in
subsidiaries is equivalent to the cost of the investment. The
carrying amount and cost of the investment at the reporting date
amounted to €4,720,000 (2022: €4,720,000). The
subsidiaries as at 31 December 2023 and 2022 are shown
below:
|
|
|
Registered
office
|
Percentage
of shares held
|
EUR
|
Nature of
business
|
|
|
|
|
|
|
|
Dino Fino
Operations Limited
|
Dino Fino Home + Contract
Msida Valley Road
Birkirkara, BKR 9025
Malta
|
100%
|
2,720,000
|
Retail of
household and
other interior goods
|
|
|
|
|
|
|
|
Dino Fino Holdings
Ltd
|
Dino Fino Home +
Contract
Msida Valley Road
Birkirkara, BKR 9025
Malta
|
100%
|
2,000,000
|
Holding
company
|
|
|
|
|
|
4,720,000
|
|
6.
Trade and other receivables
|
2023
|
2022
|
|
EUR
|
EUR
|
Non-current
|
|
|
Amount owed by parent
company
|
436,451
|
450,000
|
Amount owed by
subsidiary
|
1,269,000
|
1,599,435
|
|
1,705,451
|
2,049,435
|
|
|
|
Current
|
|
|
Amount owed by parent
company
|
-
|
9,844
|
Amount owed by
subsidiaries
|
598,034
|
122,855
|
Financial
assets
|
598,034
|
132,699
|
Prepayments and accrued
income
|
3,359
|
3,431
|
|
601,393
|
136,130
|
|
|
|
Noncurrent amounts owed
by subsidiary and parent company are unsecured, have interest rate
of 5.25% and have fixed date of repayment. Current amount owed to
subsidiaries are unsecured, interest-free and repayable on
demand.
The net carrying values
of financial assets are considered a reasonable approximation of
fair value.
7.
Share capital
|
2023
|
2022
|
|
Euro
|
Euro
|
Authorised:
|
|
|
4,999,999 ordinary A
shares of Euro 1 each
|
4,999,999
|
4,999,999
|
1 ordinary B shares of
Euro 1 each
|
1
|
1
|
|
5,000,000
|
5,000,000
|
|
|
|
Issued:
|
|
|
3,619,999 ordinary A
shares of Euro 1 each - 100% paid up
|
3,619,999
|
3,619,999
|
1 ordinary B share of
Euro 1 each - 100% paid up
|
1
|
1
|
|
3,620,000
|
3,620,000
|
|
|
|
Ordinary A shares are
entitled to one vote at a general meeting and are entitled to
receive dividend distributions. Ordinary B shares do not carry
voting rights and has no right to receive dividends nor is entitled
to any assets upon dissolution or winding up of the
Company.
8.
Debt securities in issue
|
2023
|
2022
|
|
EUR
|
EUR
|
€7,800,000 4.75%
Secured Bonds 2033
|
7,614,237
|
7,595,425
|
|
|
|
Bonds outstanding (face
value)
|
7,800,000
|
7,800,000
|
|
|
|
Gross amount of
unamortised bond issue costs
|
(225,738)
|
(225,738)
|
Accumulated
amortisation beginning of year
|
21,163
|
-
|
Amortisation charge for
the year/period
|
18,812
|
21,163
|
Unamortised bond issue
costs end of year
|
(185,763)
|
(204,575)
|
|
|
|
Amortised cost and
closing carrying amount
|
7,614,237
|
7,595,425
|
|
|
|
Unamortised bond issue
costs:
|
|
|
Falling due within 1
year
|
18,812
|
18,812
|
Falling due within 2 - 5
years
|
75,246
|
75,246
|
Falling due over 5
years
|
91,705
|
110,517
|
|
185,763
|
204,575
|
On 19 November 2021,
Dino Fino Finance P.L.C. issued 780,000 secured bonds with a
nominal value of €100 per bond. The bonds are redeemable at
their nominal value on 19 November 2033.
Interest
Interest on the 4.75%
Secured Bonds 2033 is payable annually in arrears, on 19 November
of each year.
Security
The Bonds shall
constitute the general, direct and unconditional obligations of the
Issuer to the Bondholders. It is secured by a special hypothec
granting the Security Trustee (for the benefit of the bondholders)
a right of preference and priority for repayment over the
Hypothecated Property as disclosed in note 4.
Guarantor
The bond is guaranteed
by the Company's subsidiary, Dino Fino Operations Limited, a
private limited liability company registered under the laws of
Malta with company registration number C81069 and having its
registered office situated at Dino Fino Home + Contract, Msida
Valley Road, Birkirkara, BKR 9025, Malta.
The Guarantor, as
primary obligor, jointly and severally with the Issuer,
unconditionally and irrevocably guarantees to the Security Trustee
(for the benefit of the Bondholders) that if for any reason the
Issuer fails to pay any Indebtedness as and when due, the Guarantor
will, on first demand in writing made by the Security Trustee to
the Guarantor, pay that sum to the Bondholders or to the Security
Trustee for (the benefit of the Bondholders).
9.
Trade and other payables
|
2023
|
2022
|
|
EUR
|
EUR
|
Trade payables
|
38,465
|
37,478
|
Accruals
|
64,446
|
58,059
|
Financial
liabilities
|
102,911
|
95,537
|
Indirect taxes
|
23,265
|
48,925
|
Withholding
tax
|
6,968
|
12,279
|
|
133,144
|
156,741
|
The carrying values of
financial liabilities are considered to be a reasonable
approximation of fair value.
10.
Administrative expenses
|
2023
|
From 23 August 2021
to 31 December 2022
|
|
EUR
|
EUR
|
Accountancy
fees
|
7,020
|
5,500
|
Audit fees
|
7,000
|
6,500
|
Bank charges
|
2,389
|
154
|
Company registration
fees
|
1,400
|
1,400
|
Professional
fees
|
26,344
|
24,402
|
Directors'
fees
|
54,000
|
67,719
|
Fines and
penalties
|
2,097
|
1,012
|
Subscriptions
|
82
|
10
|
MSE Listing
fees
|
4,171
|
4,024
|
Other expenses
|
160
|
-
|
Company formation
expenses
|
-
|
2,554
|
Legal fees
|
-
|
4,750
|
Computer
expenses
|
-
|
200
|
|
104,663
|
118,225
|
11.
Finance income and finance
costs
|
2023
|
From 23 August 2021
to 31 December 2022
|
|
EUR
|
EUR
|
Finance
Income
|
|
|
Finance income charged to
subsidiary
|
89,990
|
76,466
|
|
|
|
Finance
Costs
|
|
|
Interest expense from
debt securities in issue
|
374,630
|
414,754
|
Amortisation of bond
cost
|
18,812
|
21,163
|
|
393,442
|
435,917
|
|
|
|
12.
Taxation
|
2023
|
From 23 August 2021
to 31 December 2022
|
|
Euro
|
Euro
|
|
|
|
Current tax
charge
|
(14,235)
|
(13,243)
|
Group loss
relief
|
14,235
|
13,243
|
|
-
|
-
|
|
|
|
Loss before
tax
|
(151,487)
|
(202,718)
|
Tax rate
|
35%
|
35%
|
Expected tax
income
|
53,020
|
70,951
|
|
|
|
Tax effect
of:
|
|
|
Expenses disallowed for
tax purposes
|
(53,020)
|
(70,951)
|
Rental income
|
(126,000)
|
(136,500)
|
Rental expenses: allowed
deductible expenses
|
111,765
|
123,257
|
|
|
|
Tax charge
|
(14,235)
|
(13,243)
|
Group loss
relief
|
14,235
|
13,243
|
|
-
|
-
|
13.
Related parties
The Company's parent company is Dino
Fino Group Ltd, having its registered address at Msida Valley Road,
Birkirkara BKR9025, Malta. The ultimate controlling party is Mr.
Dino Fino, who is considered to be a related party. Outstanding
balances are usually settled in cash. Amounts owed by related
parties are shown separately in note 6.
The only related party
transactions entered into by the Company consist of rental income
charged to another member company of the Group. This amounted to
€360,000 (2022: €390,000).
14.
Capital risk management
The capital structure of
the Company consists of equity attributable to equity holders,
comprising issued share capital and retained earnings as disclosed
in note 7 and in the statement of changes in equity.
The Company manages its
capital to ensure that it will be able to continue as a going
concern while maximising the return to stakeholders through the
optimisation of the debt and equity balance.
15.
Financial instrument risk
Risk management
objectives and policies
The company is exposed
to various risks in relation to financial instruments. The
Company’s financial assets and liabilities by category are
summarised in note 15.3. The main types of risks are credit
risk, liquidity risk and interest rate risk.
The Company’s risk
management is coordinated by the directors and focuses on actively
securing the Company’s short to medium term cash flows by
minimising the exposure to financial risk.
The Company does not
actively engage in the trading of financial assets for speculative
purposes nor does it write options. The most significant financial
risk to which the Company is exposed are described
below.
15.1
Credit risk
Credit risk is the risk
that a counterparty fails to discharge an obligation to the
Company. The Company’s exposure to credit risk is limited to
the carrying amount of financial assets recognised at the reporting
date, as summarised below:
|
2023
|
2022
|
|
EUR
|
EUR
|
Amount owed by subsidiary
(note 6)
|
1,867,034
|
1,722,290
|
Amount owed by parent
company (note 6)
|
436,451
|
459,844
|
Cash and cash
equivalents
|
252,132
|
53,403
|
|
2,555,617
|
2,235,537
|
|
|
|
The Company continuously
monitors defaults of counterparties, identified either individually
or by group, and incorporates this information into its credit risk
controls. Where available at reasonable cost, external credit
ratings and/or reports on counterparties are obtained and used. The
Company’s policy is to deal only with creditworthy
counterparties.
The Company’s
management considers that all of the above financial assets that
are not impaired or past due for each of the reporting dates under
review are of good credit quality.
In respect of trade and
other receivables, the Company is not exposed to any significant
credit risk exposure to any single counterparty or any group of
counterparties having similar characteristics.
The credit risk for cash
and cash equivalents is considered negligible since the
counterparties are reputable banks with high quality external
credit ratings.
15.2
Liquidity risk
Liquidity risk is that
the Company might be unable to meet its obligations. The Company
manages its liquidity needs through yearly cash flow forecasts by
carefully monitoring expected cash inflows and outflows on a
monthly basis. The Company’s liquidity risk is not deemed to
be significant in view of the matching of cash inflows and outflows
arising from expected maturities of financial instruments, as well
as the Company’s committed borrowing facilities that it can
access to meet liquidity needs.
As at 31 December 2022
and 2023, the non-derivative financial liabilities have contractual
maturities (including interest payments where applicable) as
summarised below:
|
2023
|
2022
|
|
EUR
|
EUR
|
Trade and other
payables
|
|
|
Within 1 year
|
102,911
|
95,537
|
|
|
|
Debt securities in
issue
|
|
|
Within one
year
|
370,500
|
370,500
|
Two to five
years
|
1,482,000
|
1,482,000
|
Later than five
years
|
9,652,500
|
10,023,000
|
|
|
|
Related party
loan
|
|
|
Within one
year
|
125,000
|
-
|
More than one
year
|
245,000
|
-
|
15.3
Summary of financial assets and financial
liabilities by category
The carrying amounts of
the Company’s financial assets and financial liabilities as
recognised at the reporting date of the reporting year under review
may also be categorised as follows.
|
2023
|
2022
|
|
EUR
|
EUR
|
Financial
assets
|
|
|
Current assets measured
at amortised cost:
|
|
|
- Amount owed by parent
company
|
-
|
9,844
|
- Amount owed by
subsidiary
|
598,034
|
122,855
|
- Cash and cash equivalents
|
252,132
|
53,403
|
|
850,166
|
186,102
|
|
|
|
Non-current assets
measured at amortised cost:
|
|
|
- Amount owed by parent
company
|
436,451
|
450,000
|
- Amount owed by
subsidiary
|
1,269,000
|
1,599,435
|
|
1,705,451
|
2,049,435
|
|
|
|
Financial
liabilities
|
|
|
Current liabiliities
measured at amortised cost:
|
|
|
- Trade and other
payables
|
102,911
|
95,537
|
- Related party loan
|
125,000
|
-
|
|
227
, 911
|
95,537
|
|
|
|
Non-current
liabilities measured at amortised
cost:
|
|
|
- 7,800 4.75% secured
bond 2033
|
7,614,237
|
7,595,425
|
- Related party loan
|
245,000
|
-
|
|
7,859,237
|
7,595,425
|
|
|
|
16.
Shareholder’s loan
The shareholder's loan
is payable to the parent company, Dino Fino Group Ltd. The loan is
unsecured, interest free and is repayable exclusively at the option
of the Company.
17.
Statutory information
DINO FINO FINANCE
P.L.C.is a public limited liability Company incorporated in Malta
with its registered address at Dino Fino Home + Contract, Msida
Valley Road, Birkirkara, BKR 9025, Malta.
18.
Events after reporting date
No adjusting or significant
non-adjusting events have occurred between the end of the reporting
year and the date of authorisation by the directors.
|