Mariner Finance plc - 485100UWC0VRB3D40532

Mariner Finance p.l.c

Directors' report

Year ended 31 December 2021

The directors present their report and the audited financial statements of the group and the holding company for the year ended 31 December 2021.

Principal activities

The group is engaged in the investment, development and operation of sea terminals, namely in Riga, Latvia as well as property investment.

The principal activities of the company are mainly those of acting as an investment and holding company. Furthermore, the company also rents and operates owned real estate in Latvia.

Performance review

The group and company have registered a profit before tax of € 2,899,653 (2020 - € 3,485,752) and a profit before tax of € 1,742,179 (2020 - loss before tax of € 387,071) respectively.

The net assets of the group at the end of the year amounted to € 52,929,420 (2020 - € 50,297,009), and that of the company € 49,868,157 (2020 - € 48,140,925).

The increase in net assets for the group and company relate solely to the profit for the year.

The consolidated profit for the year before tax fell short of the both the profitability attained in 2020 and the budgeted profit for 2021. The reasons for this decrease in profitability were mainly, a drop in turnover at Baltic Container Terminal SIA due to a 7% decrease in volumes handled in 2021, and also an increase in the depreciation for the year under review pertaining to the right-of-use assets.

During the reporting year, the global economy continued to experience the impact of the COVID-19 pandemic. Both container volumes handled and occupancy levels within the group’s principal activities were lower as compared to the financial results obtained prior to the COVID-19 outbreak. At the date of signing of these financial statements, the Group’s activities continue to operate normally irrespective of the pandemic. Furthermore, the Group’s senior management team continues to constantly monitor the situation and the potential impact that the pandemic is having on the level of operations in comparison with both the reporting year and also the historic level of operations. Projections for the year ending 31 December 2022 incorporate the ongoing impact of such pandemic. Under these projections, the Group is expected to continue operating at a satisfactory profitable level and also continues to have sufficient liquidity and financial resources available to meet all its obligations.

The Group has a strong financial position and significant resources at its disposal, which will assist it during the economic slow down. Furthermore, the group’s container terminal as well as the property in Latvia, are both well-positioned to continue to be a long-term sustainable businesses.

The group measures the achievement of its objectives through the use of the following other key performance indicators:

Financial

The group calculates the level of its free cash flow by reference to the cash generated from continuing operations less capital expenditure, interest and tax. The group’s free cash flow at year end amounted to a surplus of € 3,996,974 (2020: € 2,167,881). This positive free cashflow is due to the significant drop in capital expenditure from € 3,991,777 to € 435,439.

The group measures its performance based on EBITDA, which is defined as the group profit before depreciation, amortisation, net investment income, finance costs and taxation. During the year under review, EBITDA decreased by 9% to € 7,249,189 from € 7,967,897.

Mariner Finance p.l.c

Directors' report

Year ended 31 December 2021

Financial - (continued)

The gearing ratio, which is defined as net debt divided by net debt plus equity, demonstrates the degree to which the capital employed in a business is funded by external borrowings as compared to shareholders' funds. The group's gearing leverage at year end stood at 43% implying a 1% decrease from the previous year.

The group aims to deliver a return on average capital employed above the level of its cost of funding. The return on average capital employed represents the operating profit on ordinary activities divided by the average of capital employed. The group ensures that this capital is used as effectively as possible. The return on average capital employed as at year end stood at 5% (2020: 7%).

Non-financial

Customer satisfaction is monitored by regular meetings with clients and other forms of informal feedback. The level of customer satisfaction remains at very good levels.

Overall terminal efficiency is calculated at the average number of container moves per hour. This decreased to 24 moves per hour in 2021 as compared to 26 moves per hour in 2020.

Property rental is measured in accordance with the level of occupancy which decreased as compared to previous years.

Principal risks and uncertainties

The successful management of risk is essential to enable the group to achieve its objectives. The ultimate responsibility for risk management rests with the group’s directors, who evaluate the group’s risk appetite and formulate policies for identifying and managing such risks. The principal risks and uncertainties facing the group are included below:

(a) Market and competition

The group operates in a highly competitive environment and faces competition from various other entities. An effective, coherent and consistent strategy to respond market dynamics, customer demands and competitors enables the group to sustain its market share and its profitability. The group continues to focus on service quality and performance in managing this risk. The group is dependent on certain customers as disclosed in note 5 to the financial statements.

(b) Legislative risks

The group is subject to numerous laws and regulations covering a wide range of matters. Failure to comply could have financial or reputational implications and could materially affect the group’s ability to operate. The group has embedded operating policies and procedures to ensure compliance with existing legislation.

Mariner Finance p.l.c

Directors' report

Year ended 31 December 2021

Economic conditions have been challenging in recent years across the market in which the group operates. A significant economic decline in any of these markets could impact the group’s ability to continue to maintain and grow throughput. Demand for the group’s services can be adversely affected by weakness in the wider economy which are beyond the group’s control. This risk is evaluated as part of the group’s annual strategy process covering the key areas of investment and development and updated regularly throughout the year. The group continues to make significant investment in innovation. The group regularly reviews its pricing structures to ensure that its products are appropriately placed within the markets in which it operates.

(d) Customer service

The group’s revenues are at risk if it does not continue to provide the level of service expected by its customers. The group’s commitment to customers is embedded in its values. The group continually seeks to make improvements to the services provided by investing in technology, equipment and infrastructure, through the ongoing training of employees and enhancements in operational practices.

(e) Political risk

The group operates in a country with stable social and political conditions. Adverse changes in these conditions, for example, political unrest, strikes, war and other forms of instability including natural disasters, epidemics, widespread transmission of diseases and terrorist attacks may negatively affect the group’s business, results of operations, financial conditions or prospects. The group adapts to such risks by incorporating this risk into its business strategy.

(f) Financial risk management

Note 33 to the financial statements provides details in connection with the group’s use of financial instruments, its financial risk management objectives and policies and the financial risks to which it is exposed.

Results and dividends

The result for the year ended 31 December 2021 is shown in the statement of profit or loss and other comprehensive income on page 11. The group registered a profit for the year after tax of € 2,632,411 as compared to € 3,197,262 in 2020. The reasons for the decrease in profitability were two fold, being, a drop in turnover at Baltic Container Terminal SIA and an increase in the depreciation for the year under review pertaining to the commissioning of a new quay crane and a warehouse also at Baltic Container Terminal SIA. The company registered a profit for the year of € 1,727,232 as compared to a loss of € 402,439 in 2020. This increase in profitability was solely due to dividends from a subsidiary. No final dividend is being recommended.

Post balance sheet events

Subsequent to the end of the reporting period, the global economy is experiencing the current geopolitical situation and conflict in Ukraine. Whilst performance is sensitive to further changes in the landscape, Management of Baltic Container Terminal SIA expects exports from Latvia to increase as long as there are sufficient empty containers available, whilst imports remain strong. Consequently, for 2022, Management is expecting an increase in throughput compared to 2021 levels.

Likely future business developments

The directors consider that the year end financial position was satisfactory and that the company and the group are well placed to sustain the present level of activity in the foreseeable future.


Mariner Finance p.l.c

Directors' report
Year ended 31 December 2021


Directors

The directors who served during the period were:

Marin Hili	(Chairman)
Michela Borg
Edward Hili	(Chief Executive Officer)
Kevin Saliba
Lawrence Zammit
Mark Vella	(resigned on 28 February 2022)
Anthony Busuttil
Ian Micallef	(appointed on 28 February 2022)

In accordance with the company's articles of association all the directors are to remain in office.

Going concern

After reviewing the group's and company's budget for the next financial year and other longer term plans, the directors are satisfied that, at the time of approving the financial statements, it is appropriate to adopt the going concern basis in preparing the financial statements.

Auditor

A resolution to reappoint Deloitte Audit Limited as auditor of the company will be proposed at the forthcoming annual general meeting.

Signed on behalf of the Company's Board of Directors on 27 April 2022 by Marin Hili (Chairman) and Kevin Saliba (Director) as per the Directors' Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial Statements 2021.

Mariner Finance p.l.c

Statement of directors' responsibilities

The directors are required by the Maltese Companies Act (Cap. 386) to prepare financial statements in accordance with International Financial Reporting Standards as adopted by the EU which give a true and fair view of the state of affairs of the Company and its Group at the end of each financial year, and of the profit or loss of the Company and its Group for the year then ended.

In preparing the financial statements, the directors should:

• select suitable accounting policies and apply them consistently;

• make judgements and estimates that are reasonable; and

• prepare the financial statements on a going concern basis, unless it is inappropriate to

presume that the Company and the Group will continue in business as a going concern.

The directors are responsible for ensuring that proper accounting records are kept which disclose with reasonable accuracy at any time the financial position of the Company and the Group and which enable the directors to ensure that the financial statements comply with the Companies Act (Cap. 386). This responsibility includes designing, implementing and maintaining such internal control as the directors determine 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 the Group, and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Additionally, the directors are responsible for:

• the preparation and publication of the Annual Financial Report, including the consolidated financial statements and the relevant tagging requirements therein, as required by Capital Markets Rule 5.56A, in accordance with the requirements of the European Single Electronic Format Regulatory Technical Standard as specified in the Commission Delegated Regulation (EU) 2019/815 (the “ESEF RTS”); and

• designing, implementing, and maintaining internal controls relevant to the preparation of the Annual Financial Report that is free from material non-compliance with the requirements of the ESEF RTS, whether due to fraud or error,

and consequently, for ensuring the accurate transfer of the information in the Annual Financial Report into a single electronic reporting format.

Statement of responsibility pursuant to the Capital Markets Rules issued by the Malta Financial Services Authority

In accordance with Capital Market Rule 5.68, we confirm that to the best of our knowledge:

a) the financial statements give a true and fair view of the financial position of the Company and the Group as at 31 December 2021 and of their financial performance and cash flows for the year then ended, in accordance with International Financial Reporting Standards as adopted by the EU; and

b) the Directors’ Report includes a fair review of the performance of the business and the financial position of the Company and the Group, together with a description of the principal risks and uncertainties that they face.

Signed on behalf of the Company's Board of Directors on 27 April 2022 by Marin Hili (Chairman) and Kevin Saliba (Director) as per the Directors' Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial Statements 2021.

Chairman

Mariner Finance p.l.c

Corporate governance statement

Introduction

Pursuant to the Capital Markets Rules as issued by the Malta Financial Services Authority, Mariner Finance p.l.c, (the 'company') is hereby reporting on the extent of its adoption of the Code of Principles of Good Corporate Governance (the 'Principles') contained in Appendix 5.1 of the Capital Markets Rules.

The Board acknowledges that the Code does not dictate or prescribe mandatory rules but recommends principles of good practice. Nonetheless, the Board strongly believes that the Principles are in the best interest of the shareholders and other stakeholders since they ensure that the Directors, Management and employees of the group adhere to internationally recognised high standards of Corporate Governance.

The group currently has a corporate decision-making and supervisory structure that is tailored to suit the group's requirements and designed to ensure the existence of adequate checks and balances within the group, whiles retaining an element of flexibility, particularly in view of the size of the group and the nature of its business. The group adhered to the Principles, except for those instances where there exist particular circumstances that warrant non-adherence thereto, or at least postponement for the time being.

Additionally, the Board recognises that, by virtue of the Capital Markets Rule 5.101. the company is exempt from making available the information required in terms of Capital Markets Rules 5.97.1 to 5.97.3; 5.97.6 and 5.97.7.

The Board of Directors

The Board of Directors of the company is responsible for the overall long-term direction of the group, in particular in being actively involved in overseeing the systems of control and financial reporting and that the group communicates effectively with the market.

The Board of Directors meets regularly, with minimum of four times annually, and is currently composed of seven Members, two of which are completely independent from the company or any other related companies.

Mr. Lawrence Zammit and Mr. Anthony Busuttil are independent non-executive directors of the company and Dr. Ian Micallef is a non-executive director.

Directors

Marin Hili - Chairman

Edward Hili - Chief Executive Officer

Non-Executive Directors

Michela Borg

Kevin Saliba

Lawrence Zammit

Mark Vella (resigned on 28 February 2022)

Anthony Busuttil

Ian Micallef (appointed on 28 February 2022)

Mariner Finance p.l.c

Corporate governance statement

The Board of Directors (continued)

The Board Meetings are attended by the Chief Financial Officer of the group in order for the Board to have direct access to the financial operation of the group. This is intended to, inter alia, ensure that the policies and strategies adopted by the Board are effectively implemented.

The policy on the remuneration of the Board is reviewed periodically by the shareholders of the company. Total emoluments to the Board and senior executives of the group are disclosed in note 11. All contracts are for an indefinite period. It should be also noted that not all Directors receive remuneration from Mariner Finance p.l.c. Furthermore, there are no specific amounts of their remuneration allocated to any other roles within the Group. In their capacity as Directors, the Non-Executive Directors are not entitled to profit sharing, share options, pension benefits or any other remuneration. Three of the Non-Executive Directors enjoy fixed remuneration set at € 5,000 per annum per director. No variable remuneration is paid to the Non-Executive Directors in their capacity as Directors of the Company. No remuneration, being fixed or variable is paid to the other directors of the Company. There were no changes to the company’s remuneration policy when compared to the previous year.

The company ensures that it provides directors with relevant information to enable them to effectively contribute to board decisions.

The directors are fully aware of their duties and obligations, and whenever a conflict of interest in decision making arises, they refrain from participating in such decisions.

Audit committee

The Terms of Reference of the Audit Committee, are modelled on the principles set out in the Capital Markets Rules. The Audit Committee assists the Board in fulfilling its supervisory and monitoring responsibility by reviewing the group financial statements and disclosures, monitoring the system of internal control established by management as well as the audit processes.

The Board of Directors established the Audit Committee, which meets regularly, with a minimum of four times annually, and is currently composed of the following individuals:

Mr. Lawrence Zammit (Chairman)

Mr. Mark Vella (resigned on 28 February 2022)

Mr. Anthony Busuttil

Dr. Ian Micallef (appointed on 28 February 2022)

Mr. Lawrence Zammit is an independent non-executive director of the company who the Board considers to be competent in accounting and/or auditing in terms of the Capital Markets Rules. In the Board's view, the audit committee, as a whole, has the relevant competence in the sector in which the group operates due to the professional experience of the individual members.

In terms of the Capital Markets Rules, the majority of the members of the audit committee shall be independent of the issuer. All current members of the audit committee are considered by the Board to be independent members.

The Audit Committee met four times during the year. Communication with and between the Secretary, top level management and the Committee is ongoing and considerations that required the Committee's attention were acted upon between meetings and decided by the Members (where necessary) through electronic circulation and correspondence.


Mariner Finance p.l.c

Corporate governance statement


Internal Control

While the Board is ultimately responsible for the group's internal controls as well as their effectiveness, authority to operate the group is delegated to the Chief Executive Officer.

The group's system of internal controls is designed to manage all the risks in the most appropriate manner. However, such controls cannot provide an absolute elimination of all business risks or losses. Therefore, the Board, inter alia, reviews the effectiveness of the group's system of internal controls in the following manner:

1	Reviewing the group's strategy on an on-going basis as well as setting the appropriate business objectives in order to enhance value for all stakeholders;
2	Implementing an appropriate organisational structure for planning, executing, controlling and monitoring business operations in order to achieve Group objectives;
3	Appointing and monitoring the Chief Executive Officer whose function is to manage the operations of the group;
4	Identifying and ensuring that significant risks are managed satisfactorily; and
5	Company policies are being observed.

Relations with the market

The market is kept up to date with all relevant information, and the company regularly publishes such information on its website to ensure consistent relations with the market.
Non-compliance with the code

Principle 4: Organisation Structure
The company is mainly an investment company which does not require an elaborate management structure. Its CEO is responsible for the day-to-day management of the Group, assisted, when necessary from time to time, by members of the senior management teams of the Group companies. The Directors believe the current organisational structures are adequate for current activities of the company. The Directors will maintain these structures under continuous review to ensure that they meet the changing demands of the business and to strengthen the checks and balances necessary for better corporate governance.

Mariner Finance p.l.c

Corporate governance statement

Non-compliance with the code (continued)

Principle 6: Information and professional judgement

Under the present circumstances, full adherence by the Issuer with the provisions of Principle 6 of the Code is not deemed necessary taking into account the size, nature and operations of the Issuer. The Issuer does not feel the need to establish and/or implement a succession plan for senior management in light of its existing organisational structure. The Directors will maintain the existing arrangement under continuous review to ensure that it meets the changing demands of the business and to strengthen the checks and balances necessary for better corporate governance.

Principle 8: Committees

Under the present circumstances, the Board does not consider it necessary to appoint a remuneration committee and nomination committee as decisions on these matters are taken at shareholder level. The Issuer considers that the members of the Board provide the level of skill, knowledge and experience expected in terms of the Code. Furthermore, the company does not have any employees other than directors and company secretary.

Principle 11: Conflict of interest

Under present structure, the majority of Directors of the Issuer are Directors of its parent company Mariner Capital Ltd and ultimate beneficial shareholders of the Group, and as such are susceptible to conflicts arising between the potentially diverging interests of said shareholders and the Group as well as conflicts of interest which may arise in relation to transactions involving the Issuer and Mariner Capital Ltd. Kevin Saliba, a director and company secretary, is also the Chief Financial Officer of Mariner Capital Ltd. The audit committee of the Issuer has the task of ensuring that any potential conflicts of interest that may arise at any moment, pursuant to these different roles held by Directors, are handled in the best interest of the Issuer and according to law. To the extent known or potentially known to the Issuer, there are no potential conflicts of interest between any duties of the Directors and their private interests and/or their other duties which require disclosure in terms of the Regulation.

Mariner Finance p.l.c

Statement of profit or loss and other comprehensive income

Year ended 31 December 2021


		Group		Holding company
	Notes	2021	2020	2021	2020
		€	€	€	€

Revenue	6	14,717,208	15,832,369	-	-
Cost of sales		(8,201,607)	(8,083,592)	-	-

Gross profit		6,515,601	7,748,777	-	-
Administrative expenses		(1,883,067)	(2,132,885)	(246,668)	(236,347)
Other operating income	7	560,840	604,271	270,233	372,976
Other operating expenses		(196,679)	(366,846)	(156,261)	(266,128)

Operating profit / (loss)		4,996,695	5,853,317	(132,696)	(129,499)
Net investment income / (loss)	8	99,711	(187,951)	3,729,875	1,597,428
Finance costs	9	(2,196,753)	(2,179,614)	(1,855,000)	(1,855,000)

Profit / (loss) before tax	10	2,899,653	3,485,752	1,742,179	(387,071)
Income tax expense	13	(267,242)	(288,490)	(14,947)	(15,368)

Profit / (loss) for the year attributable to the owners of the holding company		2,632,411	3,197,262	1,727,232	(402,439)


Total comprehensive income / (loss) for the year attributable to the owners of the holding company		2,632,411	3,197,262	1,727,232	(402,439)

Mariner Finance p.l.c

Statement of financial position

31 December 2021


		Group		Holding Company
	Notes	2021	2020	2021	2020
		€	€	€	€
ASSETS AND LIABILITIES
Non-current assets
Goodwill	3	13,184,904	13,184,904	-	-
Intangible asset	16	517,952	561,362	-	-
Property, plant and equipment	15	43,569,497	44,995,854	1,357	1,816
Investment property	17	4,443,000	4,652,000	4,443,000	4,652,000
Right-of-use assets	18	7,938,050	8,264,761	-	-
Investment in subsidiaries	19	-	-	26,898,805	26,898,805
Loans receivable	19	27,969,299	23,795,966	53,276,503	51,342,855


		97,622,702	95,454,847	84,619,665	82,895,476

Current assets
Loans receivable	19	414,467	749,722	-	-
Inventories	20	454,850	438,523	-	-
Trade and other receivables	21	3,216,393	2,979,922	572,802	578,180
Cash and cash equivalents	30	639,763	727,042	500,921	434,934


		4,725,473	4,895,209	1,073,723	1,013,114


Total assets		102,348,175	100,350,056	85,693,388	83,908,590


Current liabilities
Trade and other payables	22	2,246,624	2,402,733	1,013,500	1,026,529
Lease liability	25	699,696	697,349	-	-
Bank loans and overdraft	23	5,720,932	5,226,956	-	-
Current tax liability		14,959	15,380	14,909	15,330


		8,682,211	8,342,418	1,028,409	1,041,859


Non-current liabilities
Other financial liabilities	24	61,805	81,474	8,150	9,350
Debt securities in issue	27	34,788,672	34,716,456	34,788,672	34,716,456
Lease liability	25	5,604,050	6,303,746	-	-
Bank loans	23	42,017	348,953	-	-
Deferred tax liability	26	240,000	260,000	-	-


		40,736,544	41,710,629	34,796,822	34,725,806


Total liabilities		49,418,755	50,053,047	35,825,231	35,767,665


Net assets		52,929,420	50,297,009	49,868,157	48,140,925

Mariner Finance p.l.c

Statement of financial position

31 December 2021


		Group		Holding Company
	Notes	2021	2020	2021	2020
		€	€	€	€
EQUITY
Equity attributable to the owners
of the holding company
Share capital	28	500,000	500,000	500,000	500,000
Other equity	29	10,000,000	10,000,000	10,000,000	10,000,000
Other reserves	29	(1,898,805)	(1,898,805)	(936,323)	(936,323)
Revaluation reserves	29	9,368,400	9,368,400	-	-
Retained earnings		34,959,825	32,327,414	40,304,480	38,577,248


Total equity		52,929,420	50,297,009	49,868,157	48,140,925



These financial statements on pages 11 to 75 were approved by the Board of Directors and authorised for issue on 27 April 2022 and signed on its behalf by Marin Hili (Chairman) and Kevin Saliba (Director) as per the Directors' Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Report and Financial Statements 2021.

Mariner Finance p.l.c

Statement of changes in equity - Group

Year ended 31 December 2021


	Share	Other	Other	Revaluation	Retained
	capital	equity	reserves	reserve	earnings	Total
	€	€	€	€	€	€
Balance as at 1 January 2020	500,000	10,000,000	(1,898,805)	9,368,400	29,130,152	47,099,747


Profit for the year, total comprehensive income for the year	-		-		-		-		3,197,262		3,197,262


Balance as at 31 December 2020	500,000	10,000,000	(1,898,805)	9,368,400	32,327,414	50,297,009


Balance as at 1 January 2021	500,000	10,000,000	(1,898,805)	9,368,400	32,327,414	50,297,009


Profit for the year, total comprehensive income for the year	-		-		-		-		2,632,411		2,632,411


Balance as at 31 December 2021	500,000	10,000,000	(1,898,805)	9,368,400	34,959,825	52,929,420

Mariner Finance p.l.c

Statement of changes in equity - Holding company

Year ended 31 December 2021


Share	Other	Other	Retained
capital	equity	reserve	earnings	Total
€	€	€	€	€


Balance as at 1 January 2020	500,000	10,000,000	(936,323)	38,979,687	48,543,364

Loss for the year, total


comprehensive loss for the year	-		-		-		(402,439)		(402,439)


Balance as at 31 December 2020	500,000		10,000,000		(936,323)		38,577,248		48,140,925


Balance as at 1 January 2021	500,000		10,000,000		(936,323)		38,577,248		48,140,925

Profit for the year, total


comprehensive income for the year	-		-		-		1,727,232		1,727,232


Balance as at 31 December 2021	500,000		10,000,000		(936,323)		40,304,480		49,868,157

Mariner Finance p.l.c

Statement of cash flows

Year ended 31 December 2021


	Group		Holding Company
	2021	2020	2021	2020
	€	€	€	€
Cash flow from operating activities
Profit / (loss) before tax	2,899,653	3,485,752	1,742,179	(387,071)
Adjustments for:
Depreciation of property, plant and equipment	1,875,334	1,944,862	459	327
Depreciation of right-of-use assets	326,711	112,615	-	-
Amortisation	50,449	57,103	-	-
Investment income	(308,710)	(275,049)	(2,083,374)	(2,060,428)
Amortisation of bond expenses	72,217	68,420	72,217	68,420
Interest expense	2,085,324	2,057,935	1,855,000	1,855,000
Interest expense on lease liability	111,429	121,679	-	-
Loss on revaluation of investment property	209,000	463,000	209,000	463,000
Loss/(profit) on disposal of property, plant
and equipment	886	(53,079)	-	-

Operating profit/(loss) before working
capital movements	7,322,293	7,983,238	1,795,481	(60,752)
Movement in trade and other receivables	(257,751)	384,284	5,377	11,865
Movement in trade and other payables	(132,118)	63,778	14,405	(12,041)
Movement in inventories	(16,327)	26,732	-	-


Cash flow from / (used in) operations	6,916,097	8,458,032	1,815,263	(60,928)
Interest received	14,398	458	2,054,740	2,060,428
Income tax paid	(299,987)	(75,808)	(15,368)	(14,997)
Interest paid	(2,198,095)	(2,223,024)	(1,855,000)	(1,855,000)


Net cash flow from operating activities	4,432,413	6,159,658	1,999,635	129,503


Cash flow from investing activities
Purchase of property plant and equipment	(428,400)	(3,987,266)	-	(791)
Purchase of intangible assets	(7,039)	(4,511)	-	-
Dividends received	-	-	1,855,500	-
Loans advanced to parent company	(4,414,501)	(5,374,663)	(4,014,501)	(4,974,663)
Loan repayments from parent company	839,660	1,930,168	439,660	1,930,168
Loans advanced to related party	(75,000)	(331,269)	-	-
Other loan repayments	75,898	90,833	-	-
Repayments from subsidiaries	-	-	(214,306)	2,819,193


Net cash flows used in investing activities	(4,009,382)	(7,676,708)	(1,933,647)	(226,093)

Mariner Finance p.l.c

Statement of cash flows

Year ended 31 December 2021


	Group		Holding Company
	2021	2020	2021	2020
	€	€	€	€

Cash flow from financing activities
Proceeds from Sale and leaseback transaction	-	4,520,000	-	-
Lease liability paid	(697,350)	(102,885)	-	-
Repayment of bank loans	(306,936)	(5,923,319)	-	-
Drawdown of bank loans	493,976	3,135,000	-	-


Net cash flow from financing activities	(510,310)	1,628,796	-	-


Net movements in cash and cash
equivalents	(87,279)	111,746	65,988	(96,590)

Cash and cash equivalents at the
beginning of the year	727,042	615,296	434,934	531,524

Cash and cash equivalents at the
end of the year (note 30)	639,763	727,042	500,921	434,934


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


1	Company information and basis of preparation

	Mariner Finance p.l.c is a public limited company incorporated in Malta with registration number C31514 and has its registered address at 37, Censu Tabone Street, St. Julians, Malta.

	The company acts as an investment and holding company and also holds an investment property in Riga, Latvia, from which it earns rental income. The Group is engaged in the investment, development and operation of sea terminals, namely in Riga, Latvia as well as property development. As disclosed in note 27, the Company has issued bonds which are listed on the Malta Stock Exchange.

	During the reporting year, the global economy continued to experience the impact of the COVID-19 pandemic. Both container volumes handled and occupancy levels within the group’s principal activities were lower as compared to the financial results obtained prior to the COVID-19 outbreak. Additionally, the Group has noted a decrease in the fair value of the investment property as a result of the COVID-19 pandemic. At the date of signing of these financial statements, the Group’s activities continue to operate normally irrespective of the pandemic. Furthermore, the Group’s senior management team continues to constantly monitor the situation and the potential impact that the pandemic is having on the level of operations in comparison with both the reporting year and also the historic level of operations. Projections for the year ending 31 December 2022 incorporate the ongoing impact of such pandemic. Under these projections, the Group is expected to continue operating at a satisfactory profitable level and also continues to have sufficient liquidity and financial resources available to meet all its obligations.

	The Group has a strong financial position and significant resources at its disposal, which will assist it during the economic slow down. Furthermore, the group’s container terminal as well as the property in Latvia, are both well-positioned to continue to be a long-term sustainable businesses.

	The financial statements have been prepared under the historical cost basis, except for investment property which are stated at their fair value, and land and buildings which are stated at their revalued amounts, and in accordance with International Financial Reporting Standards as adopted by the EU. The significant accounting policies are set out below.

	Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

	For financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety, which are described as follows:

	Level 1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date;
	Level 2 inputs are inputs, other than quoted prices included within Level 1, that are observable for the asset or liability, either directly or indirectly; and
	Level 3 inputs are unobservable inputs for the asset or liability.

	For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis, the Company determines when transfers are deemed to have occurred between Levels in the hierarchy at the end of each reporting period.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


1	Company information and basis of preparation (continued)

	Acquisition of entities and businesses under common control

	During the financial year ended 31 December 2013, Mariner Capital Limited became the direct parent entity of Mariner Finance p.l.c., and acquired and became the ultimate parent of Baltic Container Terminal SIA and Equinor Riga SIA through its direct subsidiary, Mariner Finance Baltic SIA. Mariner Finance p.l.c. was not the parent of any entity of the Mariner Capital Limited Group as at 31 December 2013.

	During the first two quarters of 2014 the Mariner Capital Limited group entered into various linked transactions (“the restructuring transactions”). As a result of the restructuring transactions, Mariner Finance p.l.c. became the direct parent of Mariner Baltic Holdings SIA. As part of the restructuring transactions Mariner Baltic Holdings SIA became the direct parent of Mariner Finance Baltic SIA (and the indirect parent of Baltic Container Terminal SIA) and Equinor Riga SIA.

	The restructuring transactions resulted in Mariner Finance p.l.c. gaining control during 2014 of its direct subsidiary entity Mariner Baltic Holdings SIA and its indirect subsidiary entities Mariner Finance Baltic SIA, Baltic Container Terminal SIA and Equinor Riga SIA (“the subsidiaries”). During the comparative financial year, Mariner Finance p.l.c merged with its wholly owned subsidiary Mariner Baltic Holdings SIA.

	The acquisition of these subsidiaries by Mariner Finance p.l.c. fell outside the scope of International Financial Reporting Standard 3 - Business Combinations (“IFRS 3”) because the transaction merely represented a group reorganisation and because in terms of paragraph 2(c) of IFRS 3, the acquisition of these entities by Mariner Finance p.l.c. was treated as a combination of businesses under common control in which all the combining entities are ultimately controlled by the same party, Mariner Capital Limited, both before and after the business combination and that control was not transitory.

	In accordance with ‘International Accounting Standard 8 - Accounting Policies, Changes in Accounting Estimates and Errors’ (“IAS 8”), in the absence of an IFRS that specifically applies to a transaction, other event or condition, management should use its judgment in developing and applying an accounting policy that is relevant to the decision making needs of the users and is reliable. In relation to this specific transaction, the use of predecessor accounting by Mariner Finance p.l.c. was considered to be a generally accepted accounting approach to account for the acquisition of the entities under common control.

	The acquisition of the subsidiaries acquired from the direct parent by Mariner Finance p.l.c. has been accounted for under the principles of predecessor accounting as from the date these subsidiaries were acquired by its parent, Mariner Capital Limited on 1 January 2013. In terms of predecessor accounting, an acquirer is not required to be identified. The Company has incorporated the acquired entities at their previous carrying amounts of assets (including goodwill) and liabilities included in the consolidated financial statements of its parent, Mariner Capital Limited.

	This accounting treatment gave rise to differences on acquisition between the consideration given in exchange for the acquired entities and the amounts at which the assets and liabilities of the acquired entities are initially recognised; any such differences were included within equity unless they represent amounts payable in the subsequent period, in which case, these were included within liabilities.

	The merger of Mariner Baltic Holdings SIA during the prior year has also been accounted for in the separate financial statements under the principles of predecessor accounting by incorporating the underlying items at their previous carrying amounts. The difference between the cost of investment and the assets and liabilities acquired were included within equity.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies

	Basis of consolidation

	The consolidated financial statements incorporate the financial statements of Mariner Finance p.l.c. (or the “Company”) and subsidiary entities controlled by the Company. Control exists when the Company has power over the investee, is exposed or has rights to variable returns from its involvement with the investee and has the ability to use its power over the investee to affect the amount of its returns. In assessing control, potential voting rights that give the Company the current ability to direct the investee’s relevant activities are taken into account.

	Acquisition of subsidiaries

	The acquisition of subsidiaries is accounted for by applying the acquisition method. The consideration is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by the acquirer in exchange for control of the acquiree. Acquisition-related costs are generally recognised in profit or loss as incurred, except for costs to issue debt or equity securities. The acquiree’s identifiable assets and liabilities that meet the conditions for recognition are recognised at their fair values at the acquisition date, except as specifically required by other EU-IFRSs. A contingent liability assumed in a business combination is recognised at the acquisition date if there is a present obligation that arises from past events and its fair value can be measured reliably.

	Non-controlling interests in the acquiree that are present ownership interests and entitle their holders to a proportionate share of the entity’s net assets in the event of liquidation may be initially measured either at the present ownership instruments’ proportionate share in the recognised amounts of the acquiree’s identifiable net assets or at fair value. The choice of measurement basis is made on an acquisition-by-acquisition basis. All other components of non-controlling interests shall be measured at their acquisition-date fair values, unless another measurement basis is required. After initial recognition, non-controlling interests in the net assets consist of the amount of those interests at the date of the original business combination and the non-controlling interests’ share of changes in equity since the date of the combination. Non-controlling interests in the net assets of consolidated subsidiaries are presented separately from the holding company’s owners’ equity therein. Non-controlling interests in the profit or loss and other comprehensive income of consolidated subsidiaries are also disclosed separately. Total comprehensive income is attributed to non-controlling interests even if this results in the non-controlling interests having a deficit balance.

	The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date control ceases.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Acquisition of subsidiaries (continued)

	Where necessary, in preparing these consolidated financial statements, appropriate adjustments are made to the financial statements of subsidiaries to bring their accounting policies in line with those used by group entities. Intra-group balances, transactions, income and expenses are eliminated on consolidation.

	Goodwill is measured as the excess of:
	(a)	the aggregate of:
		(i)	the consideration transferred;
		(ii)	the amount of any non-controlling interests in the acquiree;
		(iii)	in a business combination achieved in stages, the acquisition-date fair value of the acquirer's previously held equity interest in the acquiree; and

	(b)	the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed.


	The goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated impairment losses. Any gain on a bargain purchase, after reassessment, is recognised immediately in profit and loss.

	On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

	Business combinations achieved in stages

	Where a business combination is achieved in stages, the Group’s previously held interests in the acquired entity are re measured to fair value at the acquisition date and the resulting gain or loss, if any, is recognised in profit or loss. Amounts previously recognised in other comprehensive income in relation to the acquiree are accounted for (that is, reclassified to profit or loss or transferred directly to retained earnings) in the same manner as would be required if the interests were disposed of.

	Property, plant and equipment

	Property, plant and equipment are classified into the following classes - land and buildings, plant and equipment, furniture, fittings and equipment, and fixed assets under construction.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Property, plant and equipment (continued)

	Land and buildings held for use in the production or supply of goods or services, or for administrative purposes are stated in the statement of financial position at their revalued amounts, being the fair value at the date of the revaluation less any subsequent accumulated depreciation and any accumulated impairment losses.

	Revaluations are made for the entire class of land and buildings and with sufficient regularity such that the carrying amount does not differ materially from that which would be determined using fair values at the end of the reporting period. Any accumulated depreciation at the date of the revaluation is eliminated against the gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset.

	Any revaluation increase arising on the revaluation is recognised in other comprehensive income and accumulated in equity under the heading of revaluation surplus unless it reverses a revaluation decrease for the same asset previously recognised in profit or loss, in which case the increase is credited to profit or loss to the extent of the decrease previously charged. A decrease in carrying amount arising on the revaluation is recognised in profit or loss to the extent that it exceeds the balance, if any, held in the revaluation surplus relating to a previous revaluation of that asset. Every year, the difference between depreciation based on the revalued carrying amount of the asset and depreciation based on the asset’s original cost is transferred from the revaluation surplus to retained earnings. When the asset is derecognised, the attributable revaluation remaining in the revaluation surplus is transferred to retained earnings.

	Other tangible assets are stated at cost less any accumulated depreciation and any accumulated impairment losses.

	Property, plant and equipment are derecognised on disposal or when no future economic benefits are expected from their use or disposal. Gains or losses arising from derecognition represent the difference between the net disposal proceeds, if any, and the carrying amount, and are included in profit or loss in the period of derecognition.

	Properties in the course of construction

	Properties in the course of construction for production, supply or administrative purposes, are carried at cost, less any identified impairment loss. Cost includes, for qualifying assets, borrowing costs capitalised in accordance with the group’s accounting policy on borrowing costs. Depreciation of these assets, on the same basis as other property assets, commences when the assets are available for use.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Investment property

	Investment property is property held to earn rentals or for capital appreciation or both. Investment property is recognised as an asset when it is probable that the future economic benefits that are associated with the investment property will flow to the entity and the cost can be measured reliably. Investment property is initially measured at cost, including transaction costs. Subsequent to initial recognition investment property is stated at fair value at the end of the reporting period. Gains or losses arising from changes in the fair value of investment property are recognised in profit or loss in the period in which they arise.

	Investment property is derecognised on disposal or when it is permanently withdrawn from use and no future economic benefits are expected from its disposal. Gains or losses on derecognition represent the difference between the net disposal proceeds, if any, and the carrying amount and are recognised in profit or loss in the period of derecognition.

	Depreciation

	Depreciation commences when the depreciable assets are available for use and is charged to profit or loss so as to write off the cost/revalued amount, less any estimated residual value, over their estimated useful lives, using the straight-line method, on the following bases:

	Land and buildings	-	0.8% - 5% per annum
	Plant and equipment	-	4% - 33.33% per annum
	Furniture, fittings and equipment	-	10% - 33.33% per annum
	Fixed assets under construction	-	0% per annum

	The depreciation method applied, the residual value and the useful life are reviewed, and adjusted if appropriate, at the end of each reporting period.

	With effect from 1 January 2019, right-of-use assets are depreciated over the shorter period of the lease term and the useful life of the underlying asset. If a lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the company expects to exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. The depreciation starts at the commencement date of the lease.

	Intangible assets

	An intangible asset is recognised if it is probable that the expected future economic benefits that are attributable to the asset will flow to the group’s entities and the cost of the asset can be measured reliably.

	Intangible assets are initially measured at cost, being the fair value at the acquisition date for intangible assets acquired in a business combination. Expenditure on an intangible asset is recognised as an expense in the period when it is incurred unless it forms part of the cost of the asset that meets the recognition criteria or the item is acquired in a business acquisition and cannot be recognised as an intangible asset, in which case it forms part of goodwill at the acquisition date.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Intangible assets (continued)

	The useful life of intangible assets is assessed to determine whether it is finite or indefinite. Intangible assets with a finite useful life are amortised. Amortisation is charged to profit or loss so as to write off the cost of intangible assets less any estimated residual value, over their estimated useful lives. The amortisation method applied, the residual value and the useful life are reviewed, and adjusted if appropriate, at the end of each reporting period.

	Intangible assets are derecognised on disposal or when no future economic benefits are expected from their use or disposal. Gains or losses arising from derecognition represent the difference between the net disposal proceeds, if any, and the carrying amount, and are included in profit or loss in the period of derecognition.

	(i)	Computer Software

		In determining the classification of an asset that incorporates both intangible and tangible elements, judgement is used in assessing which element is more significant. Computer software which is an integral part of the related hardware is classified as property, plant and equipment and accounted for in accordance with the company’s accounting policy on property, plant and equipment. Where the software is not an integral part of the related hardware, this is classified as an intangible asset and carried at cost less any accumulated amortisation and any accumulated impairment losses. Computer software classified as an intangible asset is amortised on a straight-line basis. Amortisation is calculated based on the annual rates ranging from 5% to 33.33%.

	Investments in subsidiaries

	A subsidiary is an entity that is controlled by the company. Investments in subsidiaries are accounted for on the basis of the direct equity interest and are stated at cost less any accumulated impairment losses. Dividends from the investment are recognised in profit or loss.

	Other financial instruments

	Financial assets and financial liabilities are recognised when the company becomes a party to the contractual provisions of the instrument. Financial assets and financial liabilities are initially recognised at their fair value plus directly attributable transaction costs for all financial assets or financial liabilities not classified at fair value through profit or loss.

	Financial assets and financial liabilities are offset and the net amount presented in the statement of financial position when the company has a legally enforceable right to set off the recognised amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

	Financial assets are derecognised when the contractual rights to the cash flows from the financial assets expire or when the entity transfers the financial asset and the transfer qualifies for derecognition.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Other financial instruments (continued)

	Financial liabilities are derecognised when they are extinguished. This occurs when the obligation specified in the contract is discharged, cancelled or expires.

	An equity instrument is any contract that evidences a residual interest in the assets of the company after deducting all of its liabilities. Equity instruments are recorded at the proceeds received, net of direct issue costs.

	Financial assets

	Classification and measurement

	Financial assets are classified as measured at either amortised cost or fair value based on the business model for managing the assets and the asset’s contractual terms. The Group and the Company do not have any financial assets classified as fair value through other comprehensive income (managed under a hold to collect and sell business model).

	Financial assets at amortised cost

	The following financial assets are classified in this category - loans receivable, trade receivables and cash at bank.

	Financial assets are classified as measured at amortised cost if they are held within a business model with the objective to hold the financial assets in order to collect contractual cash flows and if the contractual terms of the financial asset give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding.

	Financial assets at amortised cost are initially recognised at fair value plus transaction costs that are directly attributable to the issue or acquisition of financial assets and subsequently measured at amortised cost.

	The effective interest method is a method of calculating the amortised cost of a financial asset and of allocating interest income over the relevant period.

	The effective interest rate is the rate that exactly discounts estimated future cash receipts/payments excluding ECLs through the expected life of the financial asset/financial liability, or, where appropriate, a shorter period to the gross carrying amount on initial recognition.

	Appropriate allowances for expected credit losses (ECLs) are recognised in profit or loss in accordance with the accounting policy on ECLs.

	Trade receivables which do not have a significant financing component are initially measured at their transaction price and are subsequently stated at their nominal value less any loss allowance for ECLs.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Financial liabilities and equity

	Bank borrowings

	Subsequent to initial recognition, interest-bearing bank loans are measured at amortised cost using the effective interest method. Bank loans are carried at face value due to their market rate of interest.

	Subsequent to initial recognition, interest-bearing bank overdrafts are carried at face value in view of their short-term maturities.

	Trade and other payables

	Trade and other payables are classified with current liabilities and are stated at their nominal value unless the effect of discounting is material, in which case trade payables are measured at amortised cost using the effective interest method.

	Other borrowings

	Subsequent to initial recognition, other borrowings are measured at amortised cost using the effective interest method unless the effect of discounting is immaterial.

	Shares issued by the company

	Ordinary shares issued by the company are classified as equity instruments.

	Inventories

	Inventories are stated at the lower of cost and net realisable value. Cost is calculated using the weighted average method and comprises expenditure incurred in acquiring the inventories and other costs incurred in bringing the inventories to their present location and condition. The cost of finished goods and work in progress comprises direct materials and, where applicable, direct labour costs and an appropriate proportion of production overheads based on the normal level of activity. Net realisable value represents the estimated selling price in the ordinary course of business less the estimated costs of completion and the costs to be incurred in marketing, selling and distribution.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Impairment of non-financial assets and investments in subsidiaries

	All assets are tested for impairment to the extent applicable. At the end of each reporting period, the carrying amount of assets is reviewed to determine whether there is any indication or objective evidence of impairment, as appropriate, and if any such indication or objective evidence exists, the recoverable amount of the asset is estimated.

	Intangible assets with an indefinite useful life and intangible assets that are not yet available for use are tested for impairment annually, irrespective of whether an indication of impairment exists.

	An impairment loss is the amount by which the carrying amount of an asset exceeds its recoverable amount.

	In the case of other assets tested for impairment, the recoverable amount is the higher of fair value less costs of disposal (which is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date) and value in use (which is the present value of the future cash flows expected to be derived, discounted using the pre-tax discount rate that reflects current market assessment of the time value of money and the risks specific to the asset). Where the recoverable amount is less than the carrying amount, the carrying amount of the asset is reduced to its recoverable amount, as calculated.

	Goodwill arising on the acquisition of subsidiaries is tested for impairment annually and whenever there is an indication of impairment.

	Goodwill is allocated to each of the company’s cash-generating units expected to benefit from the synergies of the combination. Where the recoverable amount of the cash-generating unit is less than the carrying amount, an impairment loss is recognised. The impairment loss is allocated first to reduce the carrying amount of any goodwill allocated and then to the other assets of the unit pro rata on the basis of the carrying amount of each asset in the unit. Where a cash-generating unit to which goodwill has been allocated is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal.

	Impairment losses are recognised immediately in profit or loss, unless the asset is carried at a revalued amount, in which case, the impairment loss is recognised in other comprehensive income to the extent that the impairment loss does not exceed the amount in the revaluation surplus for that asset.

	In the case of other assets tested for impairment, an impairment loss recognised in a prior year is reversed if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised.

	Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Impairment of non-financial assets and investments in subsidiaries (continued)

	Where an impairment loss for a cash-generating unit subsequently reverses, the impairment loss is allocated to the assets of the unit, except for goodwill, pro rata with the carrying amounts of those assets. An impairment loss recognised for goodwill is not reversed in a subsequent period.

	Impairment reversals are recognised immediately in profit or loss, unless the asset is carried at a revalued amount in which case, the impairment reversal is recognised in other comprehensive income and increases the revaluation surplus for that asset, unless an impairment loss on the same asset was previously recognised in profit or loss.

	For a cash-generating unit, the carrying amount is not increased above the lower of its recoverable amount (if determinable) and the carrying amount that would have been determined (net of amortisation or depreciation) had no impairment loss been recognised for the asset in prior years. The amount of the reversal of the impairment loss that would otherwise have been allocated to the asset is allocated pro rata to the other assets of the unit, except for goodwill.

	Impairment of financial assets other than investments in subsidiaries

	ECLs

	The Group and the Company recognise a loss allowance for ECLs.

	The amount of ECLs is updated at each reporting date to reflect changes in credit risk since the initial recognition.

	For trade receivables that do not contain a significant financing component (or for which the IFRS 15 practical expedient for contracts that are one year or less is applied), the Group and the Company apply the simplified approach and recognises lifetime ECL.

	Where a collective basis is applied, the ECLs on these financial assets are estimated using a provision matrix based on historical credit loss experience based on the past due status of the debtors, adjusted for factors that are specific to the debtors, general economic conditions of the industry in which the debtors operate and an assessment of both the current as well as the forecast direction of conditions at the reporting date.

	For all other financial instruments, the Group and the Company use the general approach and recognises lifetime ECL when there has been a significant increase in credit risk since initial recognition. If, on the other hand, the credit risk on the financial instrument has not increased significantly since initial recognition, the Group and the Company measure the loss allowance for that financial instrument at an amount equal to 12-month ECL (‘12m ECL’). The assessment of whether lifetime ECL should be recognised is based on significant increases in the likelihood or risk of a default occurring since initial recognition instead of on evidence of a financial asset being credit-impaired at the reporting date or an actual default occurring.

	Lifetime ECL represents the ECLs that will result from all possible default events over the expected life of a financial instrument. In contrast, 12m ECL represents the portion of lifetime ECL that is expected to result from default events on a financial instrument that are possible within 12 months after the reporting date.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Impairment of financial assets other than investments in subsidiaries (continued)

	ECLs (continued)

	The Group and the Company recognise an impairment gain or loss in profit or loss for all financial assets with a corresponding adjustment to their carrying amount, except for investments in debt instruments that are measured at FVTOCI.

	Significant increase in credit risk

	In assessing whether the credit risk on a financial instrument has increased significantly since initial recognition, the Group and the Company compare the risk of a default occurring on the financial instrument as at the reporting date with the risk of a default occurring on the financial instrument as at the date of initial recognition. In making this assessment, the Group and the Company consider both quantitative and qualitative information that is reasonable and supportable, including historical experience and forward-looking information that is available without undue cost or effort and, where applicable, the financial position of the counterparties.

	Forward-looking information considered includes the future prospects of the industries in which the debtors operate, obtained from economic expert reports, as well as consideration of various external sources of actual and forecast economic information that relate to the core operations.

	Irrespective of the outcome of the above assessment, the Group and the Company presume that the credit risk on a financial asset has increased significantly since initial recognition when contractual payments are more than 30 days past due, unless the Company has reasonable and supportable information, that is available without undue cost or effort, that demonstrates otherwise.

	Despite the above assessment, the Group and the Company assume that the credit risk on a financial instrument has not increased significantly since initial recognition if the financial instrument is determined to have low credit risk at the reporting date. Accordingly, for these financial assets, the loss allowance is measured at an amount equal to 12m ECL. The low credit risk assumption has been applied for the majority of the bank balances.

	For financial guarantee contracts, the Group considers the changes in the risk that the specified debtor will default on the contract.

	If not measured as a financial liability at FVTPL and if not arising from a transfer of a financial asset, financial guarantee contracts issued by the Group are subsequently measured at the higher of the following: (a) the amount of the loss allowance determined in accordance with IFRS 9; and (b) the amount initially recognised less, where appropriate, cumulative amount of income recognised in accordance with the revenue recognition policies. In the case of financial guarantee contracts, the maximum exposure to credit risk is the maximum amount the entity could have to pay if the guarantee is called on.

	Definition of default

	The Group and the Company consider the following as constituting an event of default for internal credit risk management purposes as historical experience indicates that receivables that meet either of the following criteria are generally not recoverable:


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Definition of default (continued)

	- when there is a breach of financial covenants by the counterparty; or
	- information developed internally or obtained from external sources indicates that the debtor is unlikely to pay its creditors, including the Company, in full (without taking into account any collateral held by the Company).

	Irrespective of the above analysis, the Group and the Company consider that default has occurred when a financial asset is more than 90 days past due unless there is reasonable and supportable information to demonstrate that a more lagging default criterion is more appropriate.

	Credit-impaired financial assets

	A financial asset is credit-impaired when one or more events that have a detrimental impact on the estimated future cash flows of that financial asset have occurred.

	Evidence that a financial asset is credit-impaired includes observable data about the following events:
	a) significant financial difficulty of the issuer or the borrower;
	b) a breach of contract, such as a default or past due event;
	c) the lender(s) of the borrower, for economic or contractual reasons relating to the borrower’s financial difficulty, having granted to the borrower a concession(s) that the lender(s) would not otherwise consider;
	d) it is becoming probable that the borrower will enter bankruptcy or other financial reorganisation; or
	e) the disappearance of an active market for that financial asset because of financial difficulties.

	Write-off policy

	The Company writes off a financial asset when there is information indicating that the counterparty is in severe financial difficulty and there is no realistic prospect of recovery, for example when the counterparty has been placed under liquidation or has entered into bankruptcy proceedings.

	Measurement and recognition of ECLs

	For financial assets, the credit loss is the difference between all contractual cash flows that are due in accordance with the contract and all the cash flows that are expected to be received, discounted at the original effective interest rate. ECLs represent the weighted average of credit losses with the respective risks of a default occurring as the weights.

	The assessment of the probability of default and loss given default is based on historical data adjusted by forward-looking information, where applicable. Where applicable, the financial position of the counterparties is also taken into consideration.

	Where applicable, forward-looking information considered includes the future prospects of the industries in which the debtors operate, obtained from economic expert reports as well as consideration of various external sources of actual and forecast economic information that relate to the core operations.

	For a financial guarantee contract, as the Group is required to make payments only in the event of a default by the debtor in accordance with the terms of the instrument that is guaranteed, the expected loss allowance is the expected payments to reimburse the holder for a credit loss that it incurs less any amounts that the Group expects to receive from the holder, the debtor or any other party. For financial guarantee contracts, the loss allowance is recognised as a provision.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Collective basis

	If evidence of a significant increase in credit risk at the individual instrument level is not yet available, the Group and the Company perform the assessment of significant increases in credit risk on a collective basis by considering information on, for example, a group or sub-group of financial instruments.

	Where the Company does not have reasonable and supportable information that is available without undue cost or effort to measure lifetime ECL on an individual instrument basis, lifetime ECL is measured on a collective basis.

	In such instances, the financial instruments are grouped on the basis of shared credit risk characteristics, such as behavioural patterns, payment discipline and debt recovery potential.

	Revenue recognition

	The Group recognises revenue from the following major sources:
	- cargo handling
	- storage of containers

	Revenue is measured based on the consideration specified in a contract with a customer and excludes amounts collected on behalf of third parties. The Group recognises revenue when (or as) it satisfies a performance obligation by transferring control of a promised good or service to the customer.

	Cargo handling

	This constitutes income from cargo handling, including loading, unloading and transportation of cargo and similar services, such as mooring, provided at the terminal to the Group’s customers, being mainly ship liners. The fees which are charged to customers for the services provided by the Group are based on a number of underlying metrics, such as the weight of containers, which are monitored by the Group through a detailed coding system and which become known by the time the services are provided. The customers are generally billed after the provision of such services and thus no contract liabilities are recognised by the Group in this respect. Such services are recognised over time as the services are provided and given the short duration of such services, no significant contract assets are recognised by the Group at the reporting date. A receivable is recognised by the Group until the actual payment is made by the respective customers. There is not considered to be a significant financing component in such arrangements with customers as the period between the recognition of revenue and the payment by the customer is less than one year.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Revenue recognition (continued)

	Storage of containers

	This constitutes revenue generated through the provision of container storage facilities at the terminal, which revenue falls within the scope of IFRS 15 as opposed to IAS 17. The performance obligation is to provide storage facilities to the respective customers, including ship liners, over the required duration. The transaction price is based on a fee structure which is based on a fixed fee per day subject to certain free days which are generally not considered to have a material effect on the allocation of the transaction price over the duration of the contract. The customers are billed monthly in arrears and thus no contract liabilities or contract assets are recognised by the Group in this respect. Such services are recognised over time. A receivable is recognised until the actual payment is made by the respective customers. There is not considered to be a significant financing component in such arrangements with customers as the period between the recognition of revenue and the payment by the customer is less than one year.

	Interest income

	Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts the estimated future cash receipts through the expected life of the financial asset. Interest income is recognised to the extent that is probable that future economic benefits will flow to the Group and these can be measured reliably.

	Rent receivable

	Rent is recognised as disclosed in the accounting policy on leases.

	Dividend income

	Dividend income is recognised when the shareholder’s right to receive payment is established. Dividend income is recognised to the extent that it is probable that future economic benefits will flow to the Group and these can be measured reliably.

	Borrowings costs

	Borrowing costs include the costs incurred in obtaining external financing.

	Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are capitalised from the time that expenditure for these assets and borrowing costs are being incurred and activities that are necessary to prepare these assets for their intended use or sale are in progress. Borrowing costs are capitalised until such time as the assets are substantially ready for their intended use or sale. Borrowing costs are suspended during extended period in which active development is interrupted. All other borrowing costs are recognised as an expense in profit or loss in the period in which they are incurred.

	Leases

	The company assesses whether the contract is, or contains, a lease at inception of a contract. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Leases (continued)

	The lease term is determined as the non-cancellable period of a lease, together with both:
		(a) periods covered by an option to extend the lease if the lessee is reasonably certain to exercise that option; and
		(b) periods covered by an option to terminate the lease if the lessee is reasonably certain not to exercise that option.

	The company as a lessee:

	The Company recognises a right-of-use asset and a corresponding lease liability with respect to all lease arrangements in which it is the lessee, unless otherwise stated below.

	Where a right-of-use asset and a corresponding lease liability is recognised, the lease liability is initially measured at the commencement date at the present value of the lease payments that are not paid at that date, discounted by using the rate implicit in the lease. If this rate cannot be readily determined, the Company uses its incremental borrowing rate.

	Lease payments included in the measurement of the lease liability comprise:
		(a) fixed lease payments (including in-substance fixed payments), less any lease incentives receivable;
		(b) variable lease payments that depend on an index or a rate, initially measured using the index or rate at the commencement date;
		(c) the amount expected to be payable by the lessee under residual value guarantees;
		(d) the exercise price of purchase options, if the lessee is reasonably certain to exercise the options; and
		(e) payments of penalties for terminating the lease, if the lease term reflects the exercise of an option to terminate the lease.

	The lease liability is subsequently measured by increasing the carrying amount to reflect interest on the lease liability (using the effective interest method) and by reducing the carrying amount to reflect the lease payments made.

	The Company remeasures the lease liability to reflect revised in-substance fixed lease payments or whenever:
		(a) there is a change in the lease term or a change in the assessment of a purchase option being exercised, in which case the lease liability is remeasured by discounting the revised lease payments using a revised discount rate; or
		(b) there is a change in future lease payments resulting from a change in an index or a rate or a change in the amounts expected to be payable under a residual value guarantee, in which cases the lease liability is remeasured by discounting the revised lease payments using an unchanged discount rate (unless the lease payments change is due to a change in a floating interest rate, in which case a revised discount rate is used). For such remeasurements, the amount is recognised as an adjustment to the right-of-use asset, unless the carrying amount of the right-of-use asset is reduced to zero, in which case the amount is recognised in profit or loss.

	The carrying amount of the lease liability is also remeasured when a lease contract is modified and the lease modification is not accounted for as a separate lease, in which case the lease liability is remeasured based on the lease term of the modified lease by discounting the revised lease payments using a revised discount rate at the effective date of the modification.

	The right-of-use assets are initially measured at the commencement date at cost, being the amount of the initial measurement of the corresponding lease liability, lease payments made at or before the commencement day, less any lease incentives received and any initial direct costs.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Leases (continued)


	The right-of-use assets are subsequently measured at cost less accumulated depreciation and impairment losses.

	Right-of-use assets are depreciated over the shorter period of the lease term and the useful life of the underlying asset. If a lease transfers ownership of the underlying asset or the cost of the right-of-use asset reflects that the Company expects to exercise a purchase option, the related right-of-use asset is depreciated over the useful life of the underlying asset. The depreciation starts at the commencement date of the lease. The Company applies the accounting policy entitled ‘Impairment of other assets’ to determine and to measure the extent of any impairment losses on the right-of-use assets.

	Variable lease payments that do not depend on an index or rate are not included in the measurement of the lease liability and the right-of-use asset. The related payments are recognised as an expense in the period in which the event or condition that triggers those payments occurs and are included in ‘Other operating expenses’ in profit or loss.

	In the statement of financial position, right-of-use assets that do not meet the definition of investment property are included separately from other assets. In the statement of financial position, right-of-use assets that meet the definition of investment property are presented with investment property. In the statement of financial position, lease liabilities are included separately from other liabilities.

	In the statement of profit or loss and other comprehensive income, interest expense on the lease liability is presented separately from the depreciation charge for the right-of-use asset. In the statement of cash flows, cash payments for the principal portion of the lease liability are presented within financing activities and cash payments for the interest portion of the lease liability are presented within operating activities. Short-term lease payments, payments for leases of low value assets and variable lease payments not included in the measurement of the lease liability are included within operating activities.

	For short-term leases (defined as leases with a lease term of 12 months or less) and leases of low value assets, the Company applies the recognition exemption. For these leases, the Company recognises the lease payments as an operating expense on a straight-line basis over the term of the lease unless another systematic basis is more representative of the pattern of the lessee's benefit.

	The company as a lessor:

	Leases for which the Company is a lessor continue to be classified as finance or operating leases. Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards incidental to ownership to the lessee. All other leases are classified as operating leases. Lease classification is made at the inception of the lease, which is the earlier of the date of the lease agreement and the date of commitment by the parties to the principal provisions of the lease.

	When the Company is an intermediate lessor, it accounts for the head lease and the sublease as two separate contracts. The sublease is classified as a finance or operating lease by reference to the right-of-use asset arising from the head lease.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Leases (continued)

	Leased assets are presented in the statement of financial position according to their nature and are tested for impairment in accordance with the company’s accounting policy on impairment. Depreciable leased assets are depreciated in accordance with the company’s accounting policy on depreciation. Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease unless another systematic basis is more representative of the pattern in which benefit from the use of the underlying asset is diminished. Initial direct costs incurred in obtaining an operating lease are added to the carrying amount of the leased asset.

	Amounts due from lessees under a finance lease are presented in the statement of financial position as receivables at the amount of the Company’s net investment in the lease and include initial direct costs. Finance lease income is allocated to accounting periods so as to reflect a constant periodic rate of return on the Company’s net investment in the finance lease.

	When a contract includes lease and non-lease components, the Company applies IFRS 15 to allocate the consideration under the contract to each component.

	Taxation

	Deferred tax is calculated at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates that have been enacted or substantively enacted by the end of the reporting period.

	Current tax assets and liabilities are offset when the company has a legally enforceable right to set off the recognised amounts and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously.

	Deferred tax assets and liabilities are offset when the company has a legally enforceable right to set off its current tax assets and liabilities and the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities which intend either to settle current tax liabilities and assets on a net basis, or to realise the assets and settle the liabilities simultaneously, in each future period in which significant amounts of deferred tax liabilities or assets are expected to be settled or recovered.

	Deferred tax liabilities are not recognised for taxable temporary differences arising on investments in subsidiaries/associates/interests in joint arrangements where the company is able to control the timing of the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets are recognised for deductible temporary differences arising on investments in subsidiaries/associates/interests in joint arrangements where it is probable that taxable profit will be available against which the temporary difference can be utilised and it is probable that the temporary difference will reverse in the foreseeable future.

	Corporate income tax expenses in relation to the subsidiaries incorporated in Latvia are included in financial statement based on management calculations according to laws of Republic of Latvia.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Taxation (continued)

	Based on the new Corporate Income tax law of the Republic of Latvia announced in 2017, starting from 1 January 2018 corporate income tax will be applicable to distributed profits and several expenses that would be treated as profit distribution. In case of reinvestment of profit, corporate income tax shall not be applied. The applicable corporate income tax rate has increased from the 15% to 20%.

	In accordance with International Accounting Standard No 12 “Income Taxes” requirements, in cases where income tax is payable at a higher or lower rate, depending on whether the profit is distributed, the current and deferred tax assets and liabilities are measured at the tax rate applicable to undistributed profits. In Latvia the applicable rate for undistributed profits is 0%.

	Transitional conditions provide that provisions which increased taxable income in the years till 2018 will be possible use to reduce taxable income in following years for the amount of their decrease. These provisions do not create deferred tax assets on 31 December 2017 and following years due to the fact that in situation when different tax rates are applicable on distributed and undistributed profit deferred tax has to be calculated using tax rate applicable to undistributed profit, i.e. 0%.

	Starting from year 2018 corporate income tax will be calculated at the profit distribution (20/80 from net amount to be paid to shareholders). Corporate income tax will be disclosed as tax payable at the period when shareholders decide to distribute profit.

	Current and deferred tax is recognised in profit or loss, except when it relates to items recognised in other comprehensive income or directly to equity, in which case the current and deferred tax is also dealt with in other comprehensive income or in equity, as appropriate.

	Current tax is based on the taxable result for the period. The taxable result for the period differs from the result as reported in profit or loss because it excludes items which are non-assessable or disallowed and it further excludes items that are taxable or deductible in other periods. It is calculated using tax rates that have been enacted or substantively enacted by the end of the reporting period. Where income taxes are payable at a higher or lower rate, if part or all of the net profit or retained earnings is paid out as a dividend to shareholders of the entity then current and deferred tax assets and liabilities are measured at the tax rate applicable to undistributed profits.

	Deferred tax is accounted for using the balance sheet liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit.

	Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Employee benefits

	The company contributes towards the state pension in accordance with local legislation. The only obligation of the company is to make the required contributions. Costs are expensed in the period in which they are incurred.

	Currency translation

	The individual financial statements of each group entity are presented in their functional currency, being the currency of the primary economic environment in which the entity operates (its functional currency). For the purposes of the group financial statements, the results and financial position of each entity are expressed in Euro, which is the functional currency of the company.

	In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency (foreign currencies) are recorded at rates of exchange prevailing on the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing on the end of the reporting period. Non-monetary items carried at fair value that are denominated in foreign currencies are re-translated at the rates prevailing on 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 re-translated. Exchange differences arising on the settlement of monetary items and on the retranslation of monetary items are included in profit or loss. Exchange differences arising on the re-translation of non-monetary items carried at fair value are included in profit or loss for the period except for differences arising on the re-translation of non-monetary items in respect of which gains or losses are recognised in other comprehensive income. For such non-monetary items, any exchange component of that gain or loss is also recognised in other comprehensive income.

	For the purpose of presenting group financial statements, the assets and liabilities of the Group’s foreign operations (including comparatives) are expressed in Euro using exchange rates prevailing at the end of the reporting period. Income and expenses items (including comparatives) are translated at the average exchange rates for the period, unless exchange rates fluctuated significantly during the 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 and transferred to the Group Exchange Reserves. Such translation differences are recognised in profit or loss in the period in which the foreign operation is disposed of.

	Goodwill and fair value adjustments arising on the acquisition of a foreign operation are treated as assets and liabilities of the foreign operation and translated at the closing rate.

	Cash and cash equivalents

	Cash and cash equivalents comprise cash on hand and demand deposits. Bank overdrafts that are repayable on demand and form an integral 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 and are presented in current liabilities on the statement of financial position.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


2	Significant accounting policies (continued)

	Dividends

	Dividends to holders of equity instruments are recognised as liabilities in the period in which they are declared. Dividends to holders of equity instruments are recognised directly to equity.

3	Judgements in applying accounting policies and key sources of estimation uncertainty

	In the process of applying the group’s and company’s accounting policies, management has made no judgements which can significantly affect the amounts recognised in the financial statements and, at the end of the reporting period, there were no key assumptions concerning the future, or any other key sources of estimation uncertainty, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year other than as disclosed in notes 15, 17 and also as disclosed below:

	Assessment for impairment of assets

	The group reviews property, plant and equipment, intangible assets, investments, loans receivable, trade receivables, to evaluate whether events or changes in circumstances indicate that the carrying amounts may not be recoverable. The company reviews investment in subsidiaries, loans receivable, trade receivables and other investments for impairment. At the period-end there was no objective evidence of impairment in this respect.

	Furthermore, financial assets measured at amortised cost are tested in terms of the ECL model.

	In addition, the group tests goodwill annually for impairment or more frequently if there are indications that goodwill might be impaired. Determining whether the carrying amount of goodwill can be realised requires an estimation of the recoverable amount of the cash generating units.

	Goodwill arising on a business combination is allocated, to the cash-generating units (“CGUs”) that are expected to benefit from that business combination.

	The carrying amount of goodwill amounting to € 13,184,904 arises on a business combination made in 2014 and has been allocated to the business of SIA Baltic Container Terminals.

	The recoverable amounts of the CGUs are determined from value in use calculations. The key assumptions for value in use calculations are those regarding the discount rates, growth rates and expected changes to selling prices and direct costs during the period. The directors estimate discount rates using pre-tax rates that reflect current market assessment of the time value of money and specific risks. The growth rates are based on forecasts which are based on past experience and estimates which the directors consider to be appropriate in the circumstances. Changes in selling price and direct costs are based on best practices and expectations of future changes in the market. The group prepares cash flow forecasts derived from the most recent financial budgets approved by directors.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


3	Judgements in applying accounting policies and key sources of estimation uncertainty (continued)

	The assessment of recoverability of the carrying amount of goodwill includes:

	•	forecasted projected cash flows for the next 5 years and projection of terminal value using the perpetuity method;
	•	growth rate of 5% for next five years and 2% till perpetuity (2020: 2%); and
	•	use of 6.43% (pre-tax) (2020: 7.51%) to discount the projected cash flows to net present values.

	Based on the above assessment, the directors expect the carrying amount of goodwill to be recoverable and there is no impairment in value of the goodwill.

	Useful life and revaluation of property, plant and equipment

	Useful lives of property, plant and equipment are assessed at each balance sheet date and changed, if necessary, to reflect the directors current view on their remaining useful lives in the light of changes in technology, the remaining prospective economic utilisation of the assets and their physical condition.

	Effective from 1 January 2016, "BCT" has assessed the remaining useful lives of all buildings, structures and areas of cargo storage based on the evaluation performed by a certified independent valuator. As a result, the useful life of the majority of the above-noted assets was prolonged. After this change, the useful life of the buildings range from 20 year to 90 years.

	The directors evaluate whether there have been significant changes in the fair values of property which is carried at revalued amounts. The directors consider that the fair value of the revalued property approximate the carrying amounts, and therefore, no significant adjustments to the carrying amounts of the property are necessary as of 31 December 2021.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


4	Initial application of International Financial Reporting Standard and International Financial Reporting Standards in issue but not yet effective

	Initial application of International Financial Reporting Standards

	During the financial year ended 31 December 2021, the Group and the Company adopted new standards, amendments and interpretations to existing standards that are mandatory for accounting period beginning on 1 January 2021. The adoption of the following standards did not result in significant changes to these financial statements:

	Amendments to IFRS 16 as amended in March 2021 - Leases - COVID 19 - Related rent concessions. The amendment to IFRS 16 provides relief to lessees for accounting for rent concessions from lessors specifically arising from the COVID-19 pandemic. While lessees that elect to apply the practical expedient do not need to assess whether a concession constitutes a modification, lessees still need to evaluate the appropriate accounting for each concession as the terms of the concession granted may vary. Neither the Group nor the Company received any Covid-19 related rent concessions.

	Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16: Interest Rate Benchmark Reform - Phase 2 (effective on or after 1 January 2021; Early adoption is permitted). The amendments address issues that might affect financial reporting when an existing interest rate benchmark is actually replaced. In respect of the modification of financial assets, financial liabilities and lease liabilities, the IASB introduced a practical expedient for modifications required by the reform (modifications required as a direct consequence of the IBOR reform and made on an economically equivalent basis). These modifications are accounted for by updating the effective interest rate. All other modifications are accounted for using the current IFRS requirements. These amendments enable entities to reflect the effects of transitioning from interbank offered rates (IBOR) to alternative benchmark interest rates (also referred to as ‘risk free rates’ or RFRs) without giving rise to accounting impacts that would not provide useful information to users of financial statements.

	As disclosed in Note 23, 25 and 30, the Group have borrowings, resulting from a sale and leaseback transaction, with an interest rate which is linked to 3-month Euribor. Furthermore, the Group has cash and bank borrowings, as disclosed in Notes 23 and 30 which are also linked to Euribor. The calculation methodology of Euribor changed during 2019. In July 2019, the Belgian Financial Services and Markets Authority granted authorisation with respect to Euribor under the European Union Benchmarks Regulation. This allows market participants to continue to use Euribor for both existing and new contracts and the Group expects that Euribor will continue to exist as a benchmark rate for the foreseeable future. Except as disclosed in this paragraph, neither the Company nor the Group have any other financial assets, financial liabilities or lease liabilities with rates subject to the IBOR reform and accordingly this Amendment did not affect these financial statements.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


4	Initial application of International Financial Reporting Standard and International Financial Reporting Standards in issue but not yet effective (continued)

	International Financial Reporting Standards in issue but not yet effective

	At the date of approval of these financial statements, a number of International Financial Reporting Standards were either not yet endorsed by the European Union or were not yet applicable to the Group and the Company.

	Amendments to IAS 1

	The amendments affect only the presentation of liabilities in the statement of financial position - not the amount or timing of recognition of any asset, liability income or expenses, or the information that entities disclose about those items. They:
	•	Clarify that the classification of liabilities as current or non-current should be based on rights that are in existence at the end of the reporting period and align the wording in all affected paragraphs to refer to the "right" to defer settlement by at least twelve months and make explicit that only rights in place "at the end of the reporting period" should affect the classification of a liability;
	•	clarify that classification is unaffected by expectations about whether an entity will exercise its right to defer settlement of a liability; and
	•	make clear that settlement refers to the transfer to the counterparty of cash, equity instruments, other assets or services.
	The changes in ‘Classification of Liabilities as Current or Non-current - Deferral of Effective Date’ issued on 15 July 2020 defer the effective date of Classification of Liabilities as Current or Non-current (Amendments to IAS 1) to annual reporting periods beginning on or after 1 January 2023.

	IAS 8 Amendments - Definition of Accounting Estimates

	This amendment was issued to distinguish between changes in accounting policies from changes in accounting estimates. The amendment shall be effective for periods beginning on or after 1 January 2023.

	Amendment to IAS 1 and IFRS Practise Statement 2 - Disclosure of Accounting Policies

	The amendments are intended to help preparers in deciding which accounting policies to disclosure in their financial statements. The amendment shall be effective for periods beginning on or after 1 January 2023.

	IAS 12 Amendment - Deferred Tax related to Assets and Liabilities arising from a Single Transaction

	Prior to the amendments, there had been some uncertainty about whether the IAS 12 exemption from recognising deferred tax applied to transactions for which companies recognise both an asset and liability, for example leases. The amendments clarify that the exemptions does not apply and that companies are required to recognise deferred tax on such transactions. The amendments are effective for annual reporting period beginning on or after 1 January 2023.

	The directors of the Company are in the process of assessing the potential impact, if any, of these Standards on the separate and consolidated financial statements.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


5	Segment information

	The group operates one main business activity which is the operation of a sea terminal in Riga, Latvia. Apart from this the group also owns an investment property in Riga which it rents to third parties. Each of these operating segments is managed separately as each of these lines requires local resources.

	The accounting policy for identifying segments is based on internal management reporting information that is regularly reviewed by the chief operating decision maker.

	Revenue reported below represents revenue generated from external customers. There were no intersegment sales in the year. The group's reportable segments under IFRS 8 are direct sales attributable to each business activity.

	The group operates solely in Latvia.

	The group has in total two customers whose respective revenue generation exceeds 10% of the total Group's revenue. These two customers' represent 25% and 21% (2020 - 28% and 21%) of the cargo handling business.

	Measurement of operating segment profit or loss, assets and liabilities

	Segment profit represents the profit earned by each segment after allocation of central administration costs and finance costs, other than that related to the bonds issued by the holding company, based on services and finance provided. This is the measure reported to the chief operating decision maker for the purposes of resource allocation and assessment of segment performance.

	The accounting policies of the reportable segments are the same as the group's accounting policies described in note 2.

	Reconciliations of reportable segment revenues, profit or loss, assets and liabilities to consolidated totals are reported below:

	Profit before tax	2021	2020
		€	€

	Total profit for reportable segments	5,111,603	5,532,780
	Unallocated amounts:
	Bond interest expense	(1,855,000)	(1,855,000)
	Other unallocated amounts	(356,950)	(192,028)

		2,899,653	3,485,752


	Assets	2021	2020
		€	€

	Total assets for reportable segments	69,193,197	70,806,614
	Unallocated amounts:
	Goodwill	13,184,904	13,184,904
	Trade and other receivables	38,403	36,591
	Loans and receivables	19,506,046	15,931,204
	Cash and cash equivalents	425,626	390,745

		102,348,176	100,350,058


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


5	Segment information (continued)

	Liabilities			2021	2020
				€	€

	Total liabilities for reportable segments			13,641,614	14,333,472
	Unallocated amounts
	Debt Securities in issue			34,788,672	34,716,456
	Trade and other payables			988,470	1,003,119

				49,418,756	50,053,047


	The group's revenue and results from continuing operations from external customers and information about its asset and liabilities by reportable segments are detailed below:

		Cargo handling and storage of containers

			Property
			rental	Unallocated	Total
	Continuing operations	2021	2021	2021	2021
		€	€	€	€

	Revenue	14,717,208	-	-	14,717,208
	Other operating income	290,607	270,233	-	560,840


	Operating income	15,007,815	270,233	-	15,278,048


	Investment income / (loss)	279,678	(209,000)	29,033	99,711


	Interest expense	341,753	-	1,855,000	2,196,753


	Profit/(loss) before tax	5,073,544	38,059	(2,211,950)	2,899,653


	Depreciation and amortisation	2,252,035	459	-	2,252,494


	Segment assets	64,650,917	4,542,280	33,154,979	102,348,176


	Capital expenditure	456,901	-	-	456,901


	Segment liabilities	13,593,429	48,185	35,777,142	49,418,756


	Income tax expense	252,245	50	14,947	267,242


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


5	Segment information (continued)

		Cargo handling and storage of containers


			Property
			rental	Unallocated	Total
		2020	2020	2020	2020
		€	€	€	€
	Continuing operations
	Revenue	15,832,369	-	-	15,832,369
	Other operating income	231,295	372,976	-	604,271


	Operating income	16,063,664	372,976	-	16,436,640


	Investment income / (loss)	274,591	(463,000)	458	(187,951)


	Interest expense	324,614	-	1,855,000	2,179,614


	Profit/(loss) before tax	5,939,599	(406,819)	(2,047,028)	3,485,752


	Depreciation and amortisation	2,114,253	326	-	2,114,579


	Segment assets	66,079,696	4,726,918	29,543,444	100,350,058


	Capital expenditure	4,096,324	-	-	4,096,324


	Segment liabilities	14,285,287	48,185	35,719,575	50,053,047


	Income tax expense	273,072	50	15,368	288,490


6	Revenue

	Revenue represents the amount receivable for services rendered during the year, net of any indirect taxes, as follows:
		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Cargo handling and
	storage of containers	14,717,208	15,832,369	-	-


	The current year group revenue is made up of revenue from cargo handling amounting to € 13,003,096 (2020: € 14,509,370) and revenue from storage of containers amounting to € 1,714,112 (2020: € 1,322,999). All this revenue is recognised over time. Contracts with customers for cargo handling and the storage of containers generally have an original expected duration of one year or less and are recognised in terms of the Group’s accounting policies for revenues.

7	Other operating income
		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Rental and related income	467,445	518,848	260,837	367,976
	Income from sale of fixed assets	-	53,079	-	-
	Other operating income	93,395	32,344	9,396	5,000

		560,840	604,271	270,233	372,976


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


8	Net investment income / (loss)

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Interest income on bank deposits	191	373	191	373
	Interest income on related
	party loans	278,134	274,591	2,054,342	2,059,970

	Total interest income on financial
	assets not classified at fair
	value through profit and loss	278,325	274,964	2,054,533	2,060,343
	Dividend from subsidiary	-	-	1,855,500	-
	Loss on revaluation of investment
	property	(209,000)	(463,000)	(209,000)	(463,000)
	Income from
	other investments	30,386	85	28,842	85

		99,711	(187,951)	3,729,875	1,597,428


9	Finance costs

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Interest on bank loans and overdraft	230,324	202,935	-	-
	Interest on lease liabilities	111,429	121,679	-	-
	Interest on debt securities in issue	1,855,000	1,855,000	1,855,000	1,855,000

		2,196,753	2,179,614	1,855,000	1,855,000


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


10	Profit / (loss) before tax

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	This is stated after charging
	Depreciation of property, plant and equipment	1,875,334	1,944,862	459	327
	Depreciation of right-of-use assets	326,711	112,615	-	-
	Amortisation	50,449	57,103	-	-
	Foreign exchange (gains) / losses	(30,386)	41,265	(28,842)	31,134
	Utilities, maintenance, transport and other operating costs	1,536,382	1,594,916	-	-
	Fuel, lubricants, spare parts and other materials	769,158	790,267	-	-

		4,527,648	4,541,028	(28,383)	31,461


	The amount that is payable to the auditor is as follows:

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Total remuneration payable to the
	parent company's auditors for the
	audit of the financial statements	20,000	20,000	3,000	3,000
	Total fees payable to other auditors	34,200	31,450	-	-
	Total fees payable to the parent
	company's auditors for non-audit
	services other than other assurance
	services and tax advisory services
	- tax compliance	1,250	2,300	1,250	1,000
	- other assurance and
	tax advisory	8,000	3,500	-	-

		63,450	57,250	4,250	4,000


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


11	Key management personnel compensation

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Directors' compensation
	Short-term benefits:
	Fees	15,000	15,000	15,000	15,000
	Other key management
	personnel:
	Short-term benefits:
	Management remuneration	471,114	590,635	-	-

		486,114	605,635	15,000	15,000


12	Staff costs and employee information

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Staff costs:
	Wages and salaries	3,153,485	3,206,342	-	-
	Social security costs	736,419	766,094	-	-

		3,889,904	3,972,436	-	-


	The average number of persons employed during the year, including executive directors, was made up as follows:

		Group		Holding company
		2021	2020	2021	2020

	Operations	172	177	-	-
	Administration	12	12	-	-

		184	189	-	-


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


13	Income tax expense

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Current tax expense	287,242	259,448	14,947	15,368
	Deferred tax expense (note 26)	(20,000)	29,042	-	-

		267,242	288,490	14,947	15,368


	Tax applying the statutory domestic income tax rate and the income tax expense for the year are reconciled as follows:

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Profit before tax	2,899,653	3,485,752	1,742,179	(387,071)


	Tax at the applicable	1,014,879	1,220,013	609,763	(135,475)
	rate of 35%

	Tax effect of:
	Disallowed expenditure	106,191	132,685	106,191	132,685
	Income subject to lower tax rates	(54,872)	(56,421)	(54,872)	(56,421)
	Dividend income participation exemption	(649,425)	-	(649,425)	-
	Different tax rates of subsidiaries
	operating in other jurisdictions	(1,653,470)	(1,435,138)	-	-
	Income eliminated on consolidation	2,555,140	1,708,210	-	-
	Decrease in fair value of investment
	property	73,170	162,050	73,170	162,050
	Income not subject to tax	(1,124,371)	(1,442,909)	(69,880)	(87,471)

	Income tax expense
	for the year	267,242	288,490	14,947	15,368


	Based on the Corporate Income tax law of the Republic of Latvia, corporate income tax (“CIT”) is applicable to distributed profits and several expenses that would be treated as profit distribution. In case of reinvestment of profit CIT shall not be applied. The applicable CIT rate is 20%. In Latvia the applicable rate for undistributed profits is 0%.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


14	Dividend

	No final dividend is being recommended for the year ended 31 December 2021 (2020 - nil).

15	Property, plant and equipment

	Group
				Furniture	Fixed
		Land and	Plant and	fittings and	assets under
		buildings	equipment	equipment	construction	Total
		€	€	€	€	€
	Cost or valuation
	At 01.01.2020	40,620,998	15,872,284	1,315,079	10,098,802	67,907,163


	Additions	23,941	140,810	237,220	3,691,273	4,093,244
	Disposals	-	(63,094)	(79,615)	(7,560)	(150,269)
	Reclassification and sale and leaseback	7,387,405	109,966	7,950	(13,344,296)	(5,838,975)


	At 01.01.2021	48,032,344	16,059,966	1,480,634	438,219	66,011,163
	Additions	5,000	250,000	44,527	150,335	449,862
	Disposals	-	(6,003)	(58,487)	-	(64,490)
	Reclassification	103,005	180,000	10,088	(293,093)	-


	At 31.12.2021	48,140,349	16,483,963	1,476,762	295,461	66,396,535


	Accumulated depreciation
	At 01.01.2020	7,654,077	10,573,219	942,550	-	19,169,846


	Provision for the year	1,170,152	655,384	119,325	-	1,944,861
	Eliminated on disposal	-	(61,974)	(37,424)	-	(99,398)


	At 01.01.2021	8,824,229	11,166,629	1,024,451	-	21,015,309
	Provision for the year	1,195,894	564,619	114,821	-	1,875,334
	Eliminated on disposal	-	(6,003)	(57,602)	-	(63,605)


	At 31.12.2021	10,020,123	11,725,245	1,081,670	-	22,827,038


	Carrying amount
	At 31.12.2020	39,208,115	4,893,337	456,183	438,219	44,995,854


	At 31.12.2021	38,120,226	4,758,718	395,092	295,461	43,569,497


	The Group revalues property, which includes warehouse complex, administration buildings, open areas for cargo storage, access roads to railway and warehouse building. Management have reassessed the carrying amount of these properties and based on the latest valuation report dated 28 February 2022 as determined by an independent certified expert valuation, it was concluded that the carrying amount as at 31 December 2021 approximates its fair value.

	The Group’s management evaluated whether there have been significant changes in the fair values of property, which is carried at revalued amounts as of 31 December 2021. Based on the analysis, management concluded that the fair value of the revalued property approximates the carrying amounts, and, therefore, no significant adjustments to the carrying amounts of the property are necessary as of 31 December 2021.

	The fair value was determined based on income approach. The valuation corresponds to Level 3 of fair value determination hierarchy as per IFRS 13. The main Level 3 inputs used by the Group are discount rates, terminal yields, expected vacancy rates and rental rates estimated by external certified valuator based on comparable transactions and industry data.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


15	Property, plant and equipment (continued)

	Group (continued)

	In estimating the fair value of the properties, the highest and best use of the property is its current use. The fair value measurement of the group’s land and buildings is classified as Level 3 (2020 - Level 3) at the end of the reporting period.

	The following table summarizes the key quantitative information about the significant unobservable inputs used in recurring Level 3 fair value measurements as of 31 December 2021.

	Unobservable inputs	2021	2020	Relationship of unobservable inputs to fair value
	Unobservable inputs	Amount	Amount	Relationship of unobservable inputs to fair value

	Discount rate	11.95%	11.95%	The higher the discount rate and capitalisation rate, the lower the fair value
	Capitalisation rate	10.53%	10.95%
	Expected utilisation rate	68 - 73%	68 - 73%	The higher the utilisation rate, the higher the fair value

	The carrying amount of land and buildings that would have been included in the financial statements had these assets been carried at cost less accumulated depreciation and accumulated impairment losses is € 25,082,256 (2020: € 25,895,778).

	The depreciation charge is presented within cost of sales and administrative expenses in the statement of profit or loss and other comprehensive income.

	Holding company
					Furniture,
					fittings and
					equipment
					€
	Cost or valuation
	At 01.01.2020				1,705
	Additions				791


	At 01.01.2021				2,496


	At 31.12.2021				2,496


	Accumulated
	depreciation
	At 01.01.2020				353
	Provision for the year				327


	At 01.01.2021				680


	Provision for the year				459


	At 31.12.2021				1,139


	Carrying amount
	At 31.12.2020				1,816


	At 31.12.2021				1,357


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


16	Intangible assets

	Group
		Computer
		Software
		€
	Cost
	At 01.01.2020	964,276
	Additions	3,080
	Reclassification	1,430
	Disposals	(8,113)


	At 01.01.2021	960,673
	Additions	7,039


	At 31.12.2021	967,712


	Accumulated Depreciation
	At 01.01.2020	350,320
	Provision for the year	57,103
	Disposals	(8,112)


	At 01.01.2021	399,311
	Provision for the year	50,449


	At 31.12.2021	449,760


	Carrying amount
	At 31.12.2020	561,362


	At 31.12.2021	517,952


	Computer software pertains to the terminal operating software used to control and manage the operations throughout the terminal.

	The amortisation expenses on intangible assets has been included in the line item “Administrative expenses” in the statement of profit or loss and other comprehensive income.

	The group holds software with a carrying amount of € 481,962 (2020: € 475,873) and will be fully amortised in 14 years.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


17	Investment property

	Group and Holding Company

		Group and Holding Company
		€
	Fair value
	At 01.01.2020	5,115,000
	Fair value movement	(463,000)


	At 01.01.2021	4,652,000
	Fair value movement	(209,000)


	At 31.12.2021	4,443,000


	Carrying amount
	At 31.12.2020	4,652,000


	At 31.12.2021	4,443,000


	The fair value of investment properties has been arrived at on the basis of recent valuations carried out by independent professionally qualified valuators on the basis set out below. In estimating the fair values of properties, the highest and best use of the properties was used. The fair value of the group's investment property has been arrived at using Level 3 (2020 - Level 3) inputs as defined in IFRS.

	The expenses incurred in operating the investment property amounted to € 135,093 (2020 - € 147,773).

	Investment property carried at € 4,361,000
	The investment property represents a building in Riga, Latvia. The fair value has been determined based on an independent certified expert's valuation dated 25 March 2022. The valuer used two different methods of valuing the property, the market approach whereby the valuer compared the selling price of similar properties in the same location where the property is located and the income approach whereby the valuer estimated potential net income from rent using occupancy rates and market and historical trends. The fair value has been determined assuming utilisation rates from 64% to 100% (2020 - 68% to 100%), discount rate of 8.91% (2020 - 8.96%) for the forecasted period, projected annual growth rate of 2.5% (2020 - 2.5%) and a capitalisation rate of 6.41% (2020 - 6.46%). The higher the discounting rate, the lower the fair value. The higher the utilisation rate, the higher the fair value. As a result of this revaluation, the fair value of the investment property has decreased by € 209,000. This decrease has been solely due to the COVID-19 pandemic which has led the independent expert to adjust the occupancy rates of the property.

	Investment property carried at € 82,000
	The investment property represents a land in the territory of Latvia. The fair value has been determined based on independent certified expert's valuation dated 30 January 2018. The fair value has been determined based on the income approach assuming that the land plot is separated in 3 land plots and certain investments in infrastructure are made and sold within a two year period. Discount rate applied is 8.12%.

	The Group's management evaluated whether there have been significant changes in the fair value of investment property since December 2017 and concluded that the fair value approximates the carrying amount.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


17	Investment property (continued)

	Operating leases - as Lessor

	Operating leases related to investment property owned by the company with lease terms of between 5-13 years. The rental income earned by the group under operating leases amounted to € 260,837 (2020 - € 367,976). Direct operating expenses incurred by the group are € 134,635 (2020 - € 147,446) and those by the company are € 135,093 (2020 - € 147,773) in relation to the investment property during the year. In 2021, the income relating to variable lease payments by the company that do not depend on an index or a rate amounted to € 162,514 (2020 - € 165,557). The unguaranteed residual values do not represent a significant risk for the Company, as they relate to property which is located in a location with a stable value over the last few years. The Company did not identify any indications that this situation will change.

	At the end of the reporting period, the respective lessees had outstanding commitments under non-cancellable undiscounted lease payments for operating leases, which fall due as follows:

				Group and Holding Company
				Group and Holding Company
				2021	2020
				€	€

	Within less than 1 year			153,179	197,660



18	Right-Of-Use assets

				Container
		Land	Piers	Crane	Total
		€	€	€	€
	Cost
	At 01.01.2020	1,513,114	1,118,441	-	2,631,555
	Additions	-	-	5,838,974	5,838,974


	At 31.12.2020	1,513,114	1,118,441	5,838,974	8,470,529


	At 31.12.2021	1,513,114	1,118,441	5,838,974	8,470,529


	Accumulated depreciation
	At 01.01.2020	53,562	39,591	-	93,153
	Provision for the year	53,562	39,591	19,462	112,615


	At 31.12.2020	107,124	79,182	19,462	205,768
	Provision for the year	53,562	39,591	233,558	326,711


	At 31.12.2021	160,686	118,773	253,020	532,479


	Carrying amount
	At 31.12.2020	1,405,990	1,039,259	5,819,512	8,264,761


	At 31.12.2021	1,352,428	999,668	5,585,954	7,938,050



	The Group leases land and piers. The average lease term is 28 years. In the prior reporting year, the Group entered into a sale and leaseback transaction in connection with a container crane to refinance a previous facility linked to the acquisition of this asset. The cash flows arising from this transaction are included in the cash flows from financing activities in the statement of cash flows. The comparative amount as presented in the statement of cash flows, has been reclassified from cash flows from investing activity to cash flows from financing activities, as this better represents the nature of this transaction. No gain or loss was recognised which arose from this transaction. Additional information is disclosed in Note 25. The useful life of the crane is 20 years. The maturity analyses of lease liabilities is presented in Note 25.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


18	Right-Of-Use assets (continued)	2021	2020
		€	€

	Amounts recognised in profit and loss:

	Depreciation expense on right-of-use assets	326,711	112,615
	Interest expense on lease liabilities	111,429	121,679


		438,140	234,294


	Total cash outflow for leases amounted to € 808,779 (2020: € 224,564).

19	Financial assets

	Investments in subsidiaries

	Holding company

	These are stated at cost and comprise:
			Investment
			in subsidiaries
			€
	Carrying amount

	At 31.12.2020		26,898,805


	At 31.12.2021		26,898,805


	The company's proportion of ownership interest in subsidiaries at 31 December 2021 and their principal activities are as follows:

		Proportion of
		ownership	Principal
		interest	activities
		%

	Mariner Finance Baltic SIA	100 (2020 - 100%)	Holding company
	Baltic Container Terminals SIA	100 (2020 - 100%)	Maritime operations
	(indirectly through Mariner Finance Baltic SIA)

	The registered offices of the following subsidiaries are:

	Mariner Finance Baltic SIA - 1, Merkela Street, Riga, LV-1050, Latvia.
	Baltic Container Terminals SIA - 32, Uriekstes iela, Riga, LV-1005, Latvia

	These represent the non-consolidated results of the following:

		2021	2020
		€	€
	Capital and reserves:

	Mariner Finance Baltic SIA	35,713,788	34,185,008


	Profit or loss:

	Mariner Finance Baltic SIA	3,384,280	2,813,774


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


19	Financial assets (continued)

	Loans receivable
		Group				Holding Company
			Related				Loan
		Loan to	party	Other		Loan to	to
		parent	loans	loans	Total	parent	subsidiaries	Total
		€	€	€	€	€	€	€
	Amortised cost
	At 31.12.2020	22,511,635	2,030,974	3,079	24,545,688	15,931,204	35,411,651	51,342,855


	Less: Amount
	expected to be
	settled within 12
	months (shown
	under current assets)	414,234	335,488	-	749,722	-	-	-


	Amount expected
	to be settled
	after 12 months	22,097,401	1,695,486	3,079	23,795,966	15,931,204	35,411,651	51,342,855


	Amortised cost
	At 31.12.2021	26,283,660	2,097,925	2,181	28,383,766	19,506,046	33,770,457	53,276,503


	Less: Amount
	expected to be
	settled within 12
	months (shown
	under current assets)	414,467	-	-	414,467	-	-	-


	Amount expected
	to be settled
	after 12 months	25,869,193	2,097,925	2,181	27,969,299	19,506,046	33,770,457	53,276,503


		Group				Holding company
		Loan	Related			Loan	Loan
		to	party	Other		to	to
		parent	loans	loans	Total	parent	subsidiaries	Total
		€	€	€	€	€	€	€

	Amortised cost
	At 01.01.2020	18,855,416	1,727,671	-	20,583,087	12,886,709	38,230,844	51,117,553
	Advances and interest charged	5,586,387	394,136	3,079	5,983,602	4,974,663	-	4,974,663
	Repayments	(1,930,168)	(90,833)	-	(2,021,001)	(1,930,168)	(2,819,193)	(4,749,361)


	At 31.12.2020	22,511,635	2,030,974	3,079	24,545,688	15,931,204	35,411,651	51,342,855

	Advances and interest charged	4,611,684	141,951	-	4,753,635	4,014,501	-	4,014,501
	Dividend	-	-	-	-	-	(1,855,500)	(1,855,500)
	Repayments	(839,660)	(75,000)	(898)	(915,558)	(439,660)	214,306	(225,354)


	At 31.12.2021	26,283,659	2,097,925	2,181	28,383,765	19,506,045	33,770,457	53,276,502



	All the above loans are denominated in Euro (€).


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


19	Financial assets (continued)

	Loan to subsidiaries and related party

	Holding company:

	The amounts owed by subsidiaries as at December 2021 are € 457 (December 2020 - € 1,641,651) and bear no interest and are repayable on demand. The remaining loan due by subsidiary of € 33,770,000 (2020 - € 33,770,000) bears interest at the rate of 6% and is repayable by June 2024.

	Loan to parent

	Holding company:

	The amount owed by parent company is interest free and repayable on demand, however it is not expected to be repaid within twelve months after the end of the reporting period.

	Group:

	As of 31 December 2021, the Group had several outstanding loan agreements with Mariner Capital Limited for the nominal amounts of € 1,700,000, € 2,250,000, € 1,600,000, € 400,000 respectively. The loans issued should be repaid by 31 December 2025, 19 June 2027, 31 July 2026 and 15 October 2022, respectively. All loans are not secured. All loans carry an interest rate of 3.5 % per annum. During the reporting year the calculated interest for these loans was € 211,184 (2020: € 211,724).

	As of 31 December 2021, the Group had one outstanding loan agreement with Mariner Logistics SIA for the nominal amount of € 3,134,000 (2020: € 3,134,000). The interest rate for the loan is 3.5% per annum. Loan is not secured. During the reporting year Mariner Logistics SIA has not paid back any amount (2020: paid back the amount of € 90,833). Calculated interest for the reporting year is € 58,488 (2020: € 58,648). The loan should be repaid by 27 February 2024.

	During 2020, the Group had issued a new loan to Mariner Logistics SIA for the amount of € 331,269. Interest rate for the loan is 3.5% per annum. Loan is not secured. Calculated interest for the reporting year is € 8,462 (2020: € 4,219). The loan should be repaid by 1 March 2022. During the reporting year, Mariner Logistics SIA borrowed and repaid € 75,000.

20	Inventories

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Spare parts	324,173	321,836	-	-
	Raw materials	92,153	83,331	-	-
	Fuel	18,926	16,637	-	-
	Other	19,598	16,719	-	-


		454,850	438,523	-	-


	The amount of inventories recognised as an expense during the year amounted to € 778,752 (2020: €820,482).


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


21	Trade and other receivables

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Trade receivables	3,067,405	2,789,596	16,592	23,782
	Other receivables	52,811	119,130	22,306	20,494
	Accrued income	-	-	517,807	517,807
	Prepayments	96,177	71,196	16,097	16,097

		3,216,393	2,979,922	572,802	578,180


	Trade and other receivables are unsecured, interest free and repayable on demand.

	The accrued income represents the interest accrued from Mariner Finance Baltic SIA as at year-end on the loans and receivables, described in note 19.

22	Trade and other payables

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Trade payables	395,550	582,577	12,090	14,037
	Other payables	367,567	375,923	6,033	14,182
	Accrued interest	950,766	945,455	950,766	945,455
	Other accruals	532,741	498,778	44,611	52,855

		2,246,624	2,402,733	1,013,500	1,026,529


	No interest is charged on trade and other payables and are generally settled between 30 and 90 day terms.

23	Bank loans and overdrafts

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Bank loans	348,953	655,889	-	-
	Bank overdrafts	5,413,996	4,920,020	-	-
	Less: amount due for settlement
	within 12 months (shown under
	current liabilities)	(5,720,932)	(5,226,956)	-	-


	Amount due for settlement
	after 12 months	42,017	348,953	-	-


	The bank loans and overdrafts are repayable as follows:

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	On demand or within one year	5,720,932	5,226,956	-	-
	In the second year	42,017	306,937	-	-
	In the third year	-	42,016	-	-


		5,762,949	5,575,909	-	-


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


23	Bank loans and overdrafts (continued)

	The maturity of the loan in amount of € 42,017 as of 31 December 2021 is 30 April 2023 (2020: € 348,953). Average interest rate for long term loan in 2021 was 3% (2020: 3 %).

	In the reporting year, the Group has a line of credit agreement, overdraft and guarantee facility agreement with a Latvian commercial bank. The limit of the line of credit is € 6,000,000, and limit for overdraft and guarantee is € 6,000,000. Average interest rate for the overdraft and line of credit in 2021 was 3% (2020: 3%). The maturity date of the line of credit, overdraft and guarantee facility is 31 August 2022 and 31 July 2022, respectively.

	As of 31 December 2021, the overdraft's balance was in the amount of € 3,765,883 (2020: € 3,280,527). As of 31 December 2021, the line of credit's balance was in the amount of € 1,648,113 (2020: € 1,639,493).

	The borrowings from credit institutions are secured by the following agreements: mortgage collaterals and commercial pledge agreement, totalling € 21,204,262, which includes all movable property owned by the Group as of date of signing of the pledge agreement and in the future, cession agreement on trade receivables.

	All bank loans and facilities pertaining to the Group are denominated in Euro (€).

24	Other financial liabilities

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Other loans	56,265	64,854	8,150	9,350
	Deferred income	5,540	16,620	-	-


		61,805	81,474	8,150	9,350


	Amount due for settlement
	within 12 months (shown under
	current liabilities)	-	-	-	-

	Amount due for settlement
	after 12 months	61,805	81,474	8,150	9,350


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


25	Lease Liabilities

		Group
		2021	2020
		€	€

	Maturity analysis:
	Year 1	699,696	697,349
	Year 2	3,231,201	699,698
	Year 3	58,705	3,231,201
	Year 4	61,677	58,705
	Year 5	64,483	61,677
	Onwards	2,187,984	2,252,465


		6,303,746	7,001,095


		Group
		2021	2020
		€	€

	Within 1 year	699,696	697,349
	After 1 year	5,604,050	6,303,746


		6,303,746	7,001,095



	The group has a land lease and piers agreement with the Riga Freeport Authority which is valid until 22 March 2047. The annual rent charge is € 92,272 (2020: € 92,272) and € 70,792 (2020: € 70,792) for land lease and piers, respectively. At the end of the reporting period, the group had the following outstanding commitments:

		Group
		2021	2020
		€	€

	Maturity analysis:
	Within 1 year	808,778	808,778
	2 to 5 year	3,827,018	4,472,732
	More than 5 years	3,325,114	3,488,178


		7,960,910	8,769,688



	In 2020, the Group entered into a sale and leaseback transaction in connection with a container crane to refinance a previous facility linked to the acquisition of this asset. Lease interest consists of a fixed portion 1.75% and a variable element of 3 month EURIBOR. The maturity of the loan is 15 November 2023. The leased asset with net book value of € 4,466,190 as of 31 December 2021 (2021: € 4,466,190) serves as a collateral for the lease. The Group has paid €1,318,973 upfront on the initial date of the lease. The variable element recognised in the Income Statement during the year was nil.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


26	Deferred taxation

	Group

			Other
		Opening	comprehensive	Recognised	Closing
		balance	income	in profit or loss	balance
		€	€	€	€
	2021
	Arising on:
	Unremitted earnings earmarked for future distribution	260,000	-	(20,000)	240,000


		260,000	-	(20,000)	240,000


	2020
	Arising on:
	Unremitted earnings earmarked for future distribution	230,958	-	29,042	260,000


		230,958	-	29,042	260,000


	Taxation in Latvia

	In years prior to 2017 the Deferred tax for the period until 2035 was calculated at 3% tax rate, which represents the rate that had been substantively enacted for the Company based on Certificate No.33 for the right to apply direct tax relief expiring on 31 December 2035. Deferred tax liability on revaluation of fixed assets that is expected to be settled after 2035 was calculated at standard rate of 15% based on Latvian law on Corporate income tax enacted at the time.

	Based on the new Corporate Income tax law of the Republic of Latvia announced in 2017, starting from 1 January 2018 corporate income tax (CIT) will be applicable to distributed profits and several expenses that would be treated as profit distribution. In case of reinvestment of profit CIT shall not be applied. The applicable CIT rate has increased from the 15% to 20%. The Company has rights to apply direct tax relief expiring on 31 December 2035 and reduce calculated tax amount by 80%.

	Under International Accounting Standard 12, if Income taxes are payable at a higher or lower rate if part or all of the net profit or retained earnings is paid out as a dividend to shareholders of the entity then current and deferred tax assets and liabilities are measured at the tax rate applicable to undistributed profits. In Latvia, the applicable rate for undistributed profits is 0%. Therefore, in the individual financial statements the deferred tax assets and liabilities as of 31 December 2017 are released to the income statement for 2017 except for any deferred tax assets and liabilities related to the items accounted directly to the equity which are reversed through equity.

	At 31 December 2021, the Group had unused tax credits in Baltic Container Terminal SIA of € 7,121,377 (2020 - € 6,246,630), of which € 1,220,457 has not been approved by the relevant government authority for which no deferred tax asset has been recognised. The expiry date of the unutilised tax credit is 2035 as per currently enacted Latvian law on Corporate income tax.

	The aggregate amount of temporary differences associated with investments in subsidiaries for which no deferred tax liabilities have been recognised amounts to € 21,267,033 (2021 - € 19,289,393).


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


27	Debt securities in issue

		Group and Holding company
		2021	2020
		€	€

	Non-current
	5.3% bonds redeemable 2024	34,788,672	34,716,456


	The bonds are disclosed at the value of the proceeds less the net book amount of the unamortised issue costs as follows:

	Face value of bonds	35,000,000	35,000,000


	Issue costs	656,198	656,198
	Accumulated amortisation	(444,870)	(372,654)


	Net book amount	211,328	283,544


	Amortised cost	34,788,672	34,716,456


	In June 2014, the company issued an aggregate principal amount of € 35 million in Bonds, having nominal value of € 100 each, bearing interest at the rate of 5.3% per annum, payable in arrears. These bonds are unsecured pursuant and subject to terms and conditions in the prospectus dated 2 June 2014, are redeemable at their nominal value in July 2024.

	The quoted market price as at 31 December 2021 for the 5.3% Bonds 2024 was € 103 (2020: € 106.5) The weighted average effective interest rate at the end of the reporting period was 5.19% (2020: 5.2%).

	The market value of debt securities on the last trading day before the statement of financial position date was € 36,050,000 (2020: € 37,275,000).


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


28	Share capital

				2021 and 2020
					Issued and
				Authorised	called up
				€	€

	50,000 ordinary shares of € 10 each,
	all of which have been issued and called up			500,000	500,000


29	Reserves

	Other equity

	This represents a contribution of € 10,000,000 from the parent, Mariner Capital Limited. This amount is interest free, unsecured and carries no fixed date of repayment. This amount was recognised directly in equity since there is no contractual obligation to repay this amount.

	Revaluation reserve

	This represents the revaluation of the group's land and buildings consisting of the following:
	(i) the increase in the revaluation reserve in 2017 resulting from the reversal of the deferred tax liability;
	(ii) the increase in the revaluation reserve in 2019 resulting from the increase in fair value of the group's land and buildings.

	According to Latvian Commercial Law requirements, the revaluation reserve cannot be distributed to shareholders.

	Other reserves

	These represent the effect on other equity recognised on acquisition of subsidiaries in 2013 and cross border merger of Mariner Baltic Holdings SIA in 2019.

30	Cash and cash equivalents

		Group		Holding company
		2021	2020	2021	2020
		€	€	€	€

	Cash at bank	639,763	727,042	500,921	434,934


	Cash at bank earns interest at floating rates based on deposit rates.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


31	Related party disclosures

	The parent and ultimate parent company of the group is Mariner Capital Limited and MEH Holdings Limited, respectively, which are both incorporated in Malta. The registered address of both Mariner Capital Limited and MEH Holdings Limited is 37, Censu Tabone Street, St. Julians STJ 1218, Malta.

	Both Mariner Capital Limited and MEH Holdings Limited prepare consolidated financial statements which may be obtained from the Malta Business Registry.

	The directors consider the ultimate controlling party to be Marin Hili who indirectly owns 60% (2020: 60%) of Mariner Finance p.l.c.

	During the year the group and company paid remuneration to key management personnel as disclosed in note 11.

	During the year under review, the group and company entered into transactions with related parties as set out below.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


31	Related party disclosures (continued)

	Group
			2021			2020
		Related			Related
		party	Total		party	Total
		activity	activity		activity	activity
		€	€	%	€	€	%

	Administration expenses
	Related party
	transactions with:
	Parent	813,306	1,883,067	43	897,805	2,132,885	42


	Investment income
	Related party
	transactions with:
	Other related parties	278,134	280,077	99	274,591	275,049	100


	Holding Company
			2021			2020
		Related			Related
		party	Total		party	Total
		activity	activity		activity	activity
		€	€	%	€	€	%

	Administration expenses
	Related party
	transactions with:
	Parent	60,000	246,668	24	60,000	236,347	25


	Investment income
	Related party
	transactions with:
	Subsidiaries	3,909,842	3,910,033	100	2,059,970	2,060,428	100


	Other related parties consist of related parties other than the parent, entities with a joint control or significant influence over the company, subsidiaries, associates, joint ventures in which the company is a joint venturer and key management personnel of the company or its parent.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


31	Related party disclosures (continued)

	No expense has been recognised during the year arising from bad and doubtful debts in respect of amounts due by related parties.

	The terms and conditions of amounts owed by/to parent and related parties are disclosed in note 19, 21 and 29. These amounts are unsecured and no guarantees were given/received. The terms and conditions in respect of these amounts do not specify the nature of the consideration to be provided in settlement.

	As at 31 December 2021 and 31 December 2020, the group, through one of its subsidiaries, had issued a guarantee in favour of a related party for a bank loan amounting to € 1,600,000.

32	Fair value of financial assets and financial liabilities

	At 31 December 2021 and 31 December 2020 the carrying amounts of financial assets and financial liabilities classified with current assets and current liabilities respectively approximated the fair values due to the short-term maturities of these assets and liabilities. The fair values of non-current financial assets that are not measured at fair value, other than investments in subsidiaries, and the fair values of non-current bank loans are not materially different from their carrying amounts due to their current rates of interest. The fair values of financial assets and financial liabilities included in level 2 and level 3 categories below, other than debt securities and derivates, have been determined in accordance with generally accepted pricing models based on a discounted cash flow analysis, with the most significance inputs being the discount rate that reflects a market interest rate plus the credit risk of counter parties. The fair value of debt securities is disclosed in note 27.

	Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.

	For financial reporting purposes, fair value measurements are categorised into Level 1, 2 or 3 based on the degree to which the inputs to the fair value measurements are observable and the significance of the inputs to the fair value measurement in its entirety.

	For assets and liabilities that are recognised in the financial statements at fair value on a recurring basis, the Company determines when transfers are deemed to have occurred between Levels in the hierarchy at the end of each reporting period.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


32	Fair value of financial assets and financial liabilities (continued)

	The following tables provide an analysis of financial instruments, other than investments in subsidiaries that are not measured subsequent to initial recognition at fair value, other than those with carrying amounts that are reasonable approximations of fair value, grouped into Levels 1 to 3.

	Group

		Fair value measurement at end of
		the reporting period using:
						Carrying
		Level 1	Level 2	Level 3	Total	amount
		€	€	€	€	€

	2021
	Financial assets
	Loans and receivables
	Loans to parent	-	-	26,283,660	26,283,660	26,283,660
	Loans to other related
	parties	-	-	2,097,925	2,097,925	2,097,925
	Other loans	-	-	2,181	2,181	2,181


		-	-	28,383,766	28,383,766	28,383,766


	Financial liabilities
	Financial liabilities
	at amortised cost
	Debt securities	36,050,000	-	-	36,050,000	34,788,672
	Bank loans	-	348,953	-	348,953	348,953
	Bank overdrafts	-	5,413,996	-	5,413,996	5,413,996


		36,050,000	5,762,949	-	41,812,949	40,551,621


	2020
	Financial assets
	Loans and receivables
	Loans to parent	-	-	22,511,635	22,511,635	22,511,635
	Loans to other related
	parties	-	-	2,030,974	2,030,974	2,030,974
	Other loans	-	-	3,079	3,079	3,079


		-	-	24,545,688	24,545,688	24,545,688


	Financial liabilities
	Financial liabilities
	at amortised cost
	Debt securities	37,275,000	-	-	37,275,000	34,716,456
	Bank loans	-	655,889	-	655,889	655,889
	Bank overdrafts	-	4,920,020	-	4,920,020	4,920,020


		37,275,000	5,575,909	-	42,850,909	40,292,365


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


32	Fair value of financial assets and financial liabilities (continued)

	Holding company

		Fair value measurement at end of
		the reporting period using:
						Carrying
		Level 1	Level 2	Level 3	Total	amount
		€	€	€	€	€

	2021
	Financial assets
	Loans and receivables
	- receivables from
	parent company	-	-	19,506,046	19,506,046	19,506,046
	subsidiaries	-	-	33,770,000	33,770,000	33,770,000
	related parties	-	-	457	457	457


	Total	-	-	53,276,503	53,276,503	53,276,503



	Financial liabilities
	at amortised cost
	- Debt securities	36,050,000	-	-	36,050,000	34,788,672


	Total	36,050,000	-	-	36,050,000	34,788,672


						Carrying
		Level 1	Level 2	Level 3	Total	amount
		€	€	€	€	€

	2020
	Financial assets
	Loans and receivables
	- receivables from
	parent company	-	-	15,931,204	15,931,204	15,931,204
	subsidiaries	-	-	33,770,000	33,770,000	33,770,000
	related parties	-	-	1,641,651	1,641,651	1,641,651


	Total	-	-	51,342,855	51,342,855	51,342,855


	Financial liabilities
	at amortised cost
	- Debt securities	37,275,000	-	-	37,275,000	34,716,456


	Total	37,275,000	-	-	37,275,000	34,716,456


	In respect of the interest-free loans to parent, their fair values at year end are not materially different from their carrying amount, which takes into consideration the initial measurement of interest-free element as an adjustment through equity.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


33	Financial risk management

	The group's activities are exposed to a variety of financial risks including foreign, currency, liquidity, interest rate risk and credit risk. The group's management seeks to minimize its potential adverse effects of financial risks on the group's financial performance.

	The exposures to risk and the way risks arise, together with the group's and the company’s objectives, policies and processes for managing and measuring these risks are disclosed in more detail below.

	The objectives, policies and processes for managing financial risks and the methods used to measure such risks are subject to continual improvement and development.

	Where applicable, any significant changes in the company’s exposure to financial risks or the manner in which the company manages and measures these risks are disclosed below.

	Where possible, the company and the group aim to reduce and control risk concentrations. Concentrations of financial risk arise when financial instruments with similar characteristics are influenced in the same way by changes in economic or other factors. The amount of the risk exposure associated with financial instruments sharing similar characteristics is disclosed in more detail in the notes to the financial statements.

	Credit risk

	Financial assets which potentially subject the company and group to concentrations of credit risk consist principally of loans receivable, trade receivables, and cash at bank which are measured at amortised cost.

	In terms of IFRS 9, the Group and the Company apply an ECL model as apposed to an incurred loss model. Credit risk with respect to trade receivables is limited due to credit control procedures and the large number of customers comprising the company’s debtor base. Credit risk in relation to the loans and receivables due from related parties is also limited given the cash flows generated by the underlying subsidiary.

	The carrying amount of financial assets recorded in the financial statements, which is net of impairment losses, represents the company’s maximum exposure to credit risk without taking account of the value of any collateral obtained. The Group's maximum exposure also includes the financial guarantee issued in favour of a related party for a bank loan with a carrying amount as at 31 December 2021 of € 1,600,000 (2020: € 1,600,000).


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


33	Financial risk management (continued)

	Credit risk (continued)

	The tables below detail, by credit risk rating grades, the gross carrying amount of financial assets and the exposure to financial guarantee contracts.

		Group		Holding
		2021	2020	2021	2020
		12m ECL	12m ECL	12m ECL	12m ECL
		€	€	€	€
	Bank balances
	External rating grades
	A- to BBB-	275,419	392,546	141,492	103,261
	Unrated	364,344	334,496	359,429	331,673


	Gross/net carrying amount	639,763	727,042	500,921	434,934


	Cash at bank is placed with reliable financial institutions. The credit rating of the major financial institutions, representing 43% (2020 - 54%) of the total cash at bank at the end of the reporting period using Fitch credit rating symbols was AA- to BBB- (2020 - AA- to BBB-). The remaining cash and at bank balance is held with financial institutions which are unrated.

		Group		Holding
		2021	2020	2021	2020
		12m ECL	12m ECL	12m ECL	12m ECL
		€	€	€	€
	Loans to related parties
	Internal rating grades
	Performing (i)	28,383,765	24,545,688	53,276,502	51,342,855


	Gross/net carrying amount	28,383,765	24,545,688	53,276,502	51,342,855


	i) Performing - The counterparty has a low risk of default and does not have any past due amounts (12m ECL).


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


33	Financial risk management (continued)

	Credit risk (continued)

		Group
		12m	Lifetime	Lifetime	Total
		ECL	ECL	ECL
			(not credit impaired)	(credit impared but not POCI)
		€	€	€	€

	Financial guarantee contracts
	Internal rating grades
	Performing (i)	1,600,000	-	-	1,600,000


	Maximum exposure at 31 December 2020 and at 31 December 2021	1,600,000	-	-	1,600,000


				Group
				2021	2020
				Lifetime	Lifetime
				ECL	ECL
				(not credit impaired)	(not credit impaired)
				€	€

	Trade receivables tested individually
	Internal rating grades
	Performing (i)			1,770,672	1,692,183


	Gross / net carrying amount at 31 December			1,770,672	1,692,183


	i) Performing - The amounts are not credit-impaired. Lifetime ECLs apply under the simplified model.

	55% (2020: 62%) of the Group's trade receivables as at year-end arises from two customers operating in the shipping industry.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


33	Financial risk management (continued)

	Credit risk (continued)

	Provision matrix

	The table below details the risk profile of trade receivables (or contract assets or lease receivables) based on the Group’s provision matrix.

		Days past due - simplified approach
		Not past due	< 45	45 - 90	> 90	Total
		€	€	€	€	€

	2021
	Trade receivables tested collectively
	Estimated total gross carrying amount at default	834,644	259,833	60,837	207,431	1,362,745
	Lifetime ECL at 31 December 2021					(66,012)


	Net carrying amount at 31 December 2021					1,296,733


		Days past due - simplified approach
		Not past due	< 45	45 - 90	> 90	Total
		€	€	€	€	€

	2020
	Trade receivables tested collectively
	Estimated total gross carrying amount at default	814,390	252,835	6,969	125,996	1,200,190
	Lifetime ECL at 31 December 2020					(102,777)


	Net carrying amount at 31 December 2020					1,097,413


	The following table shows the movement in lifetime ECLs that has been recognised for trade receivables in accordance with the simplified approach set out in IFRS 9:

			Lifetime ECL		Lifetime ECL
			(not credit-impaired)		(credit-impaired but not POCI)
			Trade receivables	Trade receivables	Trade receivables	Trade receivables
			no SFC	no SFC	no SFC	no SFC
			(Collective)	(Individual)	(Collective)	(Individual)
			€	€	€	€

	Net carrying amount at 31 December 2020		1,097,413	1,692,183	-	-


	Net carrying amount at 31 December 2021		1,296,733	1,770,672	-	-


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


33	Financial risk management (continued)

	Currency risk

	Foreign currency transactions arise when the group buys or sells goods or services whose price is denominated in a foreign currency, borrows or lends funds when the amount payable or receivable are denominated in a foreign currency, acquires or disposes of assets or incurs or settles a liabilities denominated in a foreign currency. Foreign currency transactions comprise mainly transactions in USD. The risk arising from foreign currency transactions is managed by regular monitoring of the relevant exchange rates and directors’ reaction to material movements thereto.

	The group is exposed to foreign currency risk arising from the below financial assets:

	Foreign currency risk
			USD and USD pegged currencies
			2021	2020

	Trade and other receivables		1,119,193	1,143,741


	Balance sheet exposure		1,119,193	1,143,741


	Interest rate risk

	The company and group has taken out bank, debt securities and other facilities to finance its operations as disclosed in notes 23, 24 and 27. The interest rates thereon and the terms of such borrowings are disclosed accordingly. The interest rates on loans receivable and cash are disclosed in notes 19 and 30.

	The group is exposed to cash flow interest rate risk on borrowings and debt instruments carrying a floating interest rate and to fair value interest rate risk on borrowings and debt instruments carrying a fixed interest rate to the extent that they are measured at fair value. Investments in equity instruments are not exposed to interest rate risk.

	Management monitors the movement in interest rates and, where possible, reacts to material movements in such rates by adjusting its selling prices or by restructuring its financing structure.

	The carrying amounts of the company’s financial instruments carrying a rate of interest at the end of the reporting period are disclosed in the notes to the financial statements.

	The following table demonstrates the sensitivity analysis in relation to cash flow interest rate risk to a reasonably possible change in interest rates, with all other variables held constant, of the Group's and Company's profit before tax. The Group and Company consider the reasonably possible changes in interest rates to be a change in 25 basis points.

		Increase or decrease (basis points)

			Group	Holding
			€	€

	2021	+25	(12,808)	1,252
	2021	-25	12,808	(1,252)
	2020	+25	(12,122)	1,087
	2020	-100	12,122	(1,087)


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


33	Financial risk management (continued)

	Liquidity risk

	The Group has as a net current liability position as at 31 December 2021 of € 3,956,738 (2020: € 3,447,209), which primarily arises from the bank overdraft.

	The company monitors and manages its risk to a shortage of funds by maintaining sufficient cash, by matching the maturity of both its financial assets and financial liabilities and by monitoring the availability of raising funds to meet commitments associated with financial instruments.

	The following maturity analysis for financial liabilities shows the remaining contractual maturities using the contractual undiscounted cash flows on the basis of the earliest date on which the group and company can be required to pay. The analysis includes both interest and principal cash flows.

	Group

		On demand
		or within				5 years
		1 year	2 years	3 years	4 years	and over	Total
		€	€	€	€	€	€

	2021
	Non-derivative
	financial
	liabilities
	Non-interest
	bearing	2,240,892	-	-	-	-	2,240,892
	Fixed rate
	instruments	1,855,000	1,855,000	1,855,000	1,855,000	34,072,500	41,492,500
	Variable rate
	instruments	5,909,595	43,276	-	-	-	5,952,871
	Lease liabilities	808,784	3,500,890	815,320	-	2,835,916	7,960,910


		10,814,271	5,399,166	2,670,320	1,855,000	36,908,416	57,647,173


	2020
	Non-derivative
	financial
	liabilities
	Non-interest
	bearing	2,506,168	-	-	-	-	2,506,168
	Fixed rate
	instruments	1,855,000	1,855,000	1,855,000	1,855,000	35,927,500	43,347,500
	Variable rate
	instruments	5,245,266	306,937	42,016	-	-	5,594,219
	Lease liabilities	754,974	4,037,344	489,192	-	3,488,178	8,769,688


		10,361,408	6,199,281	2,386,208	1,855,000	39,415,678	60,217,575


	Undrawn facilities are described in note 23.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


33	Financial risk management (continued)

	Liquidity risk (continued)

	Holding company

		On demand
		or within				5 years
		1 year	2 years	3 years	4 years	and over	Total
		€	€	€	€	€	€

	2021
	Non-derivative
	financial
	liabilities
	Non-interest bearing	1,013,500	-	-	-	-	1,013,500
	Fixed rate instruments	1,855,000	1,855,000	1,855,000	1,855,000	34,072,500	41,492,500


		2,868,500	1,855,000	1,855,000	1,855,000	34,072,500	42,506,000


	2020
	Non-derivative
	financial
	liabilities
	Non-interest bearing	1,026,530	-	-	-	-	1,026,530
	Fixed rate instruments	1,855,000	1,855,000	1,855,000	1,855,000	35,927,500	43,347,500


		2,881,530	1,855,000	1,855,000	1,855,000	35,927,500	44,374,030


	Reconciliation of liabilities arising from financing activities

	The changes in the Group's liabilities arising from financing activities are those classified in the Statement of Cash Flows as cash flows used in financing activities.

	Capital risk management

	The company’s objectives when managing capital are to safeguard its ability to continue as a going concern and to maximise the return to stakeholders through the optimisation of the debt and equity balance.

	The capital structure of the company consists of bank loans, other financial liabilities and debt securities included in notes 23, 24 and 27 respectively, and items presented within equity net of cash at bank balances.

	The company’s directors manage the company’s capital structure and make adjustments to it, in light of changes in economic conditions. The capital structure is reviewed on an ongoing basis. Based on recommendations of the directors, the company balances its overall capital structure through the payment of dividends, the issue of new debt or the redemption of existing debt.

	The company's overall strategy remains unchanged from the prior year.


Mariner Finance p.l.c

Notes to the financial statements
31 December 2021


34	Capital Commitments

	The Group, through one of its subsidiaries, has future payment commitments for capital expenditure contracted for at the end of the reporting year, but not yet incurred in the amount of € 10,040 (2020: € 165,000).

35	Post balance sheet events

	Subsequent to the end of the reporting period, the global economy is experiencing the current geopolitical situation and conflict in Ukraine. Whilst performance is sensitive to further changes in the landscape, Management of Baltic Container Terminal SIA expects exports from Latvia to increase as long as there are sufficient empty containers available, whilst imports remain strong. Consequently, for 2022, Management is expecting an increase in throughput compared to 2021 levels.


Deloitte.	Deloitte Audit Limited
	Deloitte Place,
	Triq L-Intornjatur,
	Central Buiness District
	CBD 3050
	Malta

	Tel: +356 2343 2000, 2134 5000
	Fax: + 356 2133 2606
	info@deloitte.com.mt
	www.deloitte.com/mt
Independent auditor's report
to the members of	Company Ref No: C51312
Mariner Finance p.l.c	Vat Reg No: MT2013 6121
	Exemption number: EXO2155
Report on the audit of the financial statements

Opinion
We have audited the individual financial statements of Mariner Finance plc (the Company) and the consolidated financial statements of the Company and its subsidiaries (together, the Group), set out on pages 11 to 75, which comprise the Statements of Financial Position of the Company and the Group as at 31 December 2021, and the Statements of Profit or Loss and Other Comprehensive Income, Statements of Changes in Equity and Statements of Cash Flows of the Company and the Group for the year then ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements give a true and fair view of the financial position of the Company and the Group as at 31 December 2021, and of the Company’s and the Group’s financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and have been properly prepared in accordance with the requirements of the Companies Act (Cap.386).

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 Company and the Group in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) together with the Accountancy Profession (Code of Ethics for Warrant Holders) Directive (Maltese Code) that are relevant to our audit of the financial statements in Malta, and we have fulfilled our other ethical responsibilities in accordance with the IESBA Code and the Maltese Code. 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 Company and the Group and have not provided any of the non-audit services prohibited by article 18A(1) of the Accountancy Profession Act (Cap. 281).

Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the 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 financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.





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© 2022. For information, contact Deloitte Malta.


Deloitte.


Independent auditor's report
to the members of
Mariner Finance p.l.c

Impairment testing of goodwill allocated to SIA Baltic Container Terminal in the consolidated financial statements Under IFRSs, the Group is required to test goodwill acquired in a business combination for impairment annually. An impairment loss is the amount by which the carrying amount of an asset or a cash-generating unit exceeds its recoverable amount. As at 31 December 2021, the carrying amount of goodwill amounted to € 13.2m, which arose on the acquisition of SIA Baltic Container Terminal in 2013. Accordingly, the carrying amount of goodwill had been allocated to the business of SIA Baltic Container Terminal, hereafter referred to as the cash generating unit (the “CGU”), which represents a significant portion of the Group’s assets and liabilities. The directors’ process in determining the recoverable amount of the CGU is highly judgmental and is based on assumptions, such as forecast business growth rates, profit margins, projected capital expenditure, weighted average cost of capital and effective tax rate, which are affected by expected future market or economic conditions.

Our audit procedures included:

	•	Using an internal valuation specialist to assist us in evaluating the Group’s impairment methodology determined from value in use calculations and the key assumptions and inputs used by the Group for this purpose;
	•	Reviewing the Group’s impairment testing calculations for reasonability and consistency; and
	•	Performing sensitivity analysis of the impairment testing calculations to changes in key assumptions and inputs.


We also focused on the adequacy of the Group’s disclosures about those assumptions to which the outcome of the impairment test is most sensitive, that is, those that have the most significant effect on the determination of the recoverable amount of goodwill.

The Group’s disclosures about goodwill are included in Note 3, which explains that the directors have assessed the carrying amount of goodwill as at 31 December 2021 to be recoverable and that there is no impairment in the value of the goodwill.

Valuation of investment properties in the individual and consolidated financial statements The Company accounts for its investment properties at fair value. Accordingly, the establishment of the fair value of investment properties is significant to our audit because the recognised fair value of investment properties held by the Company as at 31 December 2021 amounted to € 4.36m and this amount is material to the both the individual financial statements of the Company and the consolidated financial statements of the Group.

In determining the fair value of the Company’s investment properties as at 31 December 2021, the directors utilised the services of an independent external valuer. This process is highly judgmental and is based on discounted future cash flows using assumptions such as discount rates and future increases in fair market rents as well as a comparison with current prices paid in actual market transactions for the sale of comparable properties and adjusted by the external valuer for any dissimilar characteristics between the Company’s investment property and the comparable properties. There have been no acquisitions or disposals of investment properties during the year ended 31 December 2021.


Deloitte.


Independent auditor's report
to the members of
Mariner Finance p.l.c

Our audit response in respect of the valuation of investment properties as at 31 December 2021 included the following:
	•	Reviewing the underlying basis of valuation applied by the directors to assess whether the valuation approach was consistent with IFRS and industry norms;
	•	Confirming that there were no acquisitions or disposals of investment properties during the year ended 31 December 2021;
	•	Assessing the competence, capability and objectivity of the independent external valuer appointed by the directors;

	•	Involving internal valuation specialists to review the directors’ assessment of fair value in order to determine whether the directors’ assessment falls within an acceptable range which included reviewing the appropriateness of the underlying key assumptions and factors used by the directors in their assessment.


We also focused on the adequacy of the Company’s disclosures about those assumptions to which the outcome of the valuation is most sensitive, that is, those that have the most significant effect on the determination of the fair value of the investment property.

The Company’s disclosures about fair value are included in Note 17, which explains the manner in which the fair value of the investment properties was determined by the directors.

Other information
The directors are responsible for the other information. The other information comprises the company information, the Directors’ Report,the Statement of Directors’ responsibilities and the Corporate Governance Statement, which we obtained prior to the date of this auditor’s report.

However, the other information does not include the individual and consolidated financial statements, our auditor’s report and the relevant tagging applied in accordance with the requirements of the European Single Electronic Format, as defined in our Report on Other Legal and Regulatory Requirements.

Except for our opinions on the Directors’ Report in accordance with the Companies Act (Cap. 386) and on the Corporate Governance Statementin accordance with the Listing Rules issued by the Maltese Listing Authority, our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed on the other information that we obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.


Deloitte.


Independent auditor's report
to the members of
Mariner Finance p.l.c

With respect to the Directors’ Report, we also considered whether the Directors’ Report includes the disclosure requirements of article 177 of the Companies Act (Cap. 386), and the statement required by Listing Rule 5.62 of the capital markets rules on the Company’s and the Group’s ability to continue as a going concern.

In accordance with the requirements of sub-article 179(3) of the Companies Act (Cap. 386) in relation to the Directors’ Report on pages 2 to 5, in our opinion, based on the work undertaken in the course of the audit:

	•	the information given in the Directors’ Report for the financial year for which the individual and consolidated financial statements are prepared is consistent with those financial statements; and
	•	the Directors’ Report has been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the Company, the Group and their environment obtained in the course of the audit, we have not identified any material misstatements in the Directors’ Report.

Responsibilities of the Directors and the Audit Committee for the financial statements

As explained more fully in the Statement of Directors’ Responsibilities on page 6, the directors are responsible for the preparation of financial statements that give a true and fair view in accordance with IFRSs as adopted by the European Union and the requirements of the Companies Act (Cap.386), and for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Company’s and the Group’sability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company and the Group or to cease operations, or have no realistic alternative but to do so.

The directors have delegated the responsibility for overseeing the Company’s and the Group’s financial reporting process to the Audit Committee.

Auditor’s responsibilities for the audit of the financial statements

This report, including the opinions set out herein, has been prepared for the Company’s members as a body in accordance with articles 179, 179A and 179B of the Companies Act (Cap. 386).

Our objectives are to obtain reasonable assurance about whether the 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 opinions in accordance with articles 179, 179A and 179B of the Companies Act (Cap. 386). Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted inaccordance 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 financial statements.

In terms of article 179A(4) of the Companies Act (Cap. 386), the scope of our audit does not include assurance on the future viability of the Company and the Group or on the efficiency or effectiveness with which the directors have conducted or will conduct the affairs of the Company and the Group. The financial position of the Company and the Group may improve, deteriorate, or otherwise be subject to change as a consequence of decisions taken, or to be taken, by the management thereof, or may be impacted by events occurring after the date of this opinion, including, but not limited to, events of force majeure.


Deloitte.


Independent auditor's report
to the members of
Mariner Finance p.l.c

As such, our audit report on the Company’s and the Group’s historical financial statements is not intended to facilitate or enable, nor is it suitable for, reliance by any person, in the creation of any projections or predictions, with respect to the future financial health and viability of the Company and the Group, and cannot therefore be utilised or relied upon for the purpose of decisions regarding investment in, or otherwise dealing with (including but not limited to the extension of credit), the Company and the Group. Any decision-making in this respect should be formulated on the basis of a separate analysis, specifically intended to evaluate the prospects of the Company and the Group and to identify any facts or circumstances that may be materially relevant thereto.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

	•	Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
	•	Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s and the Group’s internal control.

	•	Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.

		Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s and the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company and the Group to cease to continue as a going concern. Accordingly, in terms of generally accepted auditing standards, the absence of any reference to a material uncertainty about the Company’s and the Group’s ability to continue as a going concern in our auditor’s report should not be viewed as a guarantee as to the Company’s and the Group’s ability to continue as a going concern.

	•	Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

	•	Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.


Deloitte.


Independent auditor's report
to the members of
Mariner Finance p.l.c

For the avoidance of doubt, any conclusions concerning the adequacy of the capital structure of the Company, including the formulation of a view as to the manner in which financial risk is distributed between shareholders and/or creditors cannot be reached on the basis of these financial statements alone and must necessarily be based on a broader analysis supported by additional information.

We communicate with the Audit Committee regarding, among other matters,the planned scope and timing of the audit and significant audit findings, including any significant deficiencies ininternal control that we identify during our audit.

We also provide the Audit Committee with a statement that we have complied with 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 the Audit Committee, we determine those matters that were of most significance in the audit of the individual and 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 benefits of such communication.

Report on other legal and regulatory requirements

Report on compliance of the Annual Financial Report with the requirements of the European Single Electronic Format Regulatory Technical Standard as specified in the Commission Delegated Regulation (EU) 2019/815 (the "ESEF RTS”)

Pursuant to Capital Markets Rule 5.55.6 issued by the Malta Financial Services Authority, we have undertaken a reasonable assurance engagement in accordance with the requirements of the Accountancy Profession (European Single Electronic Format) Assurance Directive issued by the Accountancy Board in terms of the Accountancy Profession Act (Cap. 281), hereinafter referred to as the “ESEF Directive 6”, on the annual financial report of the Company and the Group for the year ended 31 December 2021, prepared in a single electronic reporting format. Solely for the purposes of our reasonable assurance report on the compliance of the annual financial report with the requirements of the ESEF RTS, the “Annual Financial Report” comprises the Directors’ Report, the Statement of Directors’ responsibilities, the Corporate Governance Statement, the annual financial statements, the prescribed disclosures of material contracts, company information, and the Independent auditor’s report, as set out in Capital Markets Rules 5.55.

Responsibilities of the Directors for the Annual Financial Report
The directors are responsible for:

	•	the preparation and publication of the Annual Financial Report, including the consolidated financial statements and the relevant tagging requirements therein, as required by Capital Markets Rule 5.56A, in accordance with the requirements of the ESEF RTS,


Deloitte.


Independent auditor's report
to the members of
Mariner Finance p.l.c

	•	designing, implementing, and maintaining internal controls relevant to the preparation of the Annual Financial Report that is free from material non-compliance with the requirements of the ESEF RTS, whether due to fraud or error,

and consequently, for ensuring the accurate transfer of the information in the Annual Financial Report into a single electronic reporting format.

Auditor’s responsibilities for the Reasonable Assurance Engagement
Our responsibility is to obtain reasonable assurance about whether the Annual Financial Report, including the consolidated financial statements and the relevant electronic tags therein comply, 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.

The nature, timing and extent of procedures we performed, including the assessment of the risks of material non-compliance with the requirements of the ESEF RTS, whether due to fraud or error, were based on our professional judgement and included:

	•	Obtaining an understanding of the Company’s and the Group’s internal controls relevant to the financial reporting process, including the preparation of the Annual Financial Report, in accordance with the requirements of the ESEF RTS, but not for the purpose of expressing an assurance opinion on the effectiveness of these controls.

	•	Obtaining the Annual Financial Report and performing validations to determine whether the Annual Financial Report has been prepared in accordance with the requirements of the technical specifications of the ESEF RTS.

	•	Examining the information in the Annual Financial Report to determine whether all the required tags therein have been applied and evaluating the appropriateness, in all material respects, of the use of such tags in accordance with the requirements of the ESEF RTS.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis for our reasonable assurance opinion.

Reasonable Assurance Opinion
In our opinion, the Annual Financial Report for the year ended 31 December 2021 has been prepared, in all material respects, in accordance with the requirements of the ESEF RTS.

This reasonable assurance opinion only covers the transfer of the information in Annual Financial Report into a single electronic reporting format as required by the ESEF RTS, and therefore does not cover the information contained in the Annual Financial Report.


Deloitte.


Independent auditor's report
to the members of
Mariner Finance p.l.c

Report on Corporate Governance Statement
Pursuant to Listing Rule 5.94 issued by the Malta Financial Services Authority, in its capacity as the Listing Authority in Malta, the directors are required to include in the Company’s annual financial report a Corporate Governance Statement explaining the extent to which they have adopted the Code of Principles of Good Corporate Governance set out in Appendix 5.1 to Chapter 5 of the Listing Rules, and the effective measures that they have taken to ensure compliance with those principles. The Corporate Governance Statement is to contain at least the information set out in Listing Rule 5.97.

Our responsibility is laid down by Listing Rule 5.98 of the Capital Markets Rules, which requires us to include a report to shareholders on the Corporate Governance Statement in the Company’s annual financial report.

We read the Corporate Governance Statement and consider the implications for our report if we become aware of any information therein that is materially inconsistent with the financial statements or our knowledge obtained in the audit, or that otherwise appears to be materially misstated. We also review whether the Corporate Governance Statement contains at least the information set out in Listing Rule 5.97 of the Capital Markets Rules.

We are not required to, and we do not, consider whether the directors’ statements on internal control cover all risks and controls, or form an opinion on the effectiveness of the company’s corporate governance procedures or its risk and control procedures.

In our opinion, the Corporate Governance Statement set out on pages 7 to 10 has been properly prepared in accordance with the requirements of Listing Rules 5.94 and 5.97 of the Capital Markets Rules.

Matters on which we are required to report by exception under the Companies Act
Under the Companies Act (Cap. 386), we have responsibilities to report to you if in our opinion:

	•	proper accounting records have not been kept;
	•	proper returns adequate for our audit have not been received from branches not visited by us;
	•	the financial statements are not in agreement with the accounting records and returns; or
	•	we have been unable to obtain all the information and explanations which, to the best of our knowledge and belief, are necessary for the purpose of our audit.


We have nothing to report to you in respect of these responsibilities.

Auditor tenure
We were first appointed by the members of the Companyto act as statutory auditor of the Company and the Group,following the Company’s debt listing in June 2014 by the members of the Company on 28 April 2015 for the financial year ended 31 December 2015, and were subsequently reappointed as statutory auditors by the members of the Company on an annual basis. The period of total uninterrupted engagement as statutory auditor since the Company became a public interest entity, including previous reappointments of the firm, covers financial periods totalling 7 years.








Contents


		Page

	Directors, officer and other information	1

	Directors' report	2 - 5

	Statement of directors' responsibilities	6

	Corporate governance statement	7 - 10

	Statement of profit or loss and other comprehensive income	11

	Statement of financial position	12 - 13

	Statements of changes in equity	14 - 15

	Statements of cash flows	16 - 17

	Notes to the financial statements	18 - 75

	Independent auditor's report	76 - 84


Mariner Finance p.l.c

Directors, officer and other information


Directors:	Marin Hili (Chairman)
	Michela Borg
	Edward Hili (Chief Executive Officer)
	Kevin Saliba
	Lawrence Zammit
	Mark Vella (resigned on 28 February 2022)
	Anthony Busuttil
	Ian Micallef (appointed on 28 February 2022)

Secretary:	Kevin Saliba

Registered Office:	37, Censu Tabone Street,
	St Julian's,
	Malta.

Country of incorporation:	Malta

Company registration number:	C31514

Auditor:	Deloitte Audit Limited,
	Deloitte Place,
	Triq l-Intorjatur,
	Central Business District,
	Malta.