ANNUAL FINANCIAL
REPORT 2023/24
FOR THE YEAR ENDED 31 JANUARY 2024
Photo by Joe Smith
ANNUAL REPORT 2022/23
TRIDENT ESTATES PLC
ii
02—05
CHAIRMAN’S STATEMENT
06
DIRECTORS
07
SENIOR MANAGEMENT AND
BOARD COMMITTEES
08—18
CHIEF EXECUTIVE
OFFICER’S REVIEW
19—70
CONSOLIDATED
FINANCIAL STATEMENTS
20—22
DIRECTORS’ REPORT
23—28
CORPORATE GOVERNANCE
STATEMENT
29—32
REMUNERATION REPORT
33—34
STATEMENTS OF
FINANCIAL POSITION
35
STATEMENTS OF
COMPREHENSIVE INCOME
36
STATEMENTS OF
CHANGES IN EQUITY
37
STATEMENTS OF CASH FLOWS
38—62
NOTES TO THE
CONSOLIDATED FINANCIAL
STATEMENTS
63
SHAREHOLDER INFORMATION
64—70
INDEPENDENT
AUDITOR’S REPORT
CONTENTS
ANNUAL
FINANCIAL
REPORT
2023/24
01
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
CHAIRMAN’S
STATEMENT
It is my pleasure to address you ahead of this 24th Annual
General meeting of T riden t Estates p lc
address my mind casts back to the first time the Farsons
Board of Directors communicated to you in 2015 that it was
contemplating the creation of a property development company
incorporating the Group’s property assets. The key objective of
this strategic move was that of increasing for the shareholders
the return on such assets by utilizing the brewery’s
expertise of undertaking complex large scale projects.
Whilst the Board of Directors worked on the
corporate spin off plan, management worked on
preparing the plans to restore, rehabilitate and
redevelop its first such project, namely the old
1950 ‘art deco’ Mriehel brewery building, into a
‘green’ business park venture. This idea originated
in 2008 when your board reviewed the growing
value of its property portfolio, much of which was
believed to be underutilized.
The actual spin off took place in January 2018
and construction work started shortly thereafter.
The project was funded by the combination of
a cash injection from Farsons of €6,000,000, a
rights issue (subscribed to by the shareholders)
of €15,000,000 and negotiated long term bank
facilities. At the time of the spin off all Farsons
shareholders received on a pari passu basis one
Trident Estates share for every share they owned
in Farsons, this by way of an in specie dividend.
Trident Park opened its doors to its first tenants in
Q1 2022, and the official inauguration took place
last June.
The whole project has been a success story
because of the professional planning and
exceptional dedication of the team involved.
Indeed, the report we present to you today
illustrates that the project has been a success in
more ways than one. We have signed tenancy
agreements which will result in an occupancy
level of 83% of the available area once all the
contracted tenants in question move in over the
next few months.
The rental rates achieved are in line with our
feasibility studies and we are especially proud of
the high quality of the tenants that have chosen
to come to Trident Park. During the financial year
ending January 2024 we achieved a profitable
year of operations with an actual (taken up)
occupancy level of approximately 40%. This
augurs well for the future profitability and
prospects for your Company as tenants move in
over the next weeks and months.
Our Chief Executive Officer, Charles Xuereb,
has outlined in his review of the financial results
the substantial improvement in revenues
resulting from the increase in the number of
tenants occupying the available spaces at
Trident Park and other properties. Revenue
grew from €2,354,000 to €4,216,000, an
increase of 79%. Operating profit increased
from €1,267,000 to €2,206,000, an increase
of 74%. Profit after finance charges, taxation
and an increase in fair value gain of €585,000
amounted to €1,052,000. The CEO explains the
reason for the substantial increase in finance
costs from €530,000 last year to €1,496,000
this year. We do not expect interest costs
to increase materially over the coming year,
and believe that over time interest costs may
moderate as the ECB measures bring inflation
under control.
We can also report further increases in rentals
from the original portfolio of properties taken
over from the Farsons Group.
02 ChairmaN’S STaTEmENT
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
ChairmaN’S STaTEmENT 03
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
04 ChairmaN’S STaTEmENT
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
Some of these properties used to house the
Farsons Group quick service restaurants that are
operated by Food Chain Holdings. Food Chain is
now able to search for sites for retail outlets that
are optimal for their specific purposes rather than
preferring those properties formerly owned by
the Group. This has allowed them to improve their
performance whilst also freeing up Trident Estates
to negotiate better deals in the open market, which
we are now managing to achieve. This is precisely
what the spin off was intended to achieve!
We can conclude that both the concept of the
spin off and the substantial investment in Trident
Park have both been success stories. Shareholder
value of the two Groups of companies has risen
to a higher level than the market value of the
Farsons Group pre spin off and the prospects for
Trident Estates plc are good, bearing in mind that
property developments of this nature constitute
long term capital investments.
Indeed, again as reported by our CEO the
aesthetic qualities and environmental
credentials of Trident Park which was officially
inaugurated on 28 June 2023, have been
recognized by newspaper editorials, and
several prestigious awards both locally and
internationally. These are highlighted in this
annual report. They include the prestigious local
‘Din l-Art Helwa’ Architectural Heritage Award
and the coveted ‘Judge Caruana Curran Award’
which recognizes the Trident Park project for its
exceptional quality, historical significance and
positive impact on the community.
Further, a special book entitled ‘Renewal
Architects’ has been published and was
launched a day before the inauguration
ceremony. It documents the philosophy
behind the project, the various difficulties that
were encountered in realizing the renewal
and rehabilitation of the building, and has
contributions by the main protagonists and most
particularly the eminent architect Ian Ritchie.
I am indebted to our colleagues, consultants,
suppliers of services and many of our contractors
for their extraordinary effort in delivering a world
class building which is now earning its keep. I am
of course proud that we have managed to realize
a dream that was long in the making.
On a sad note, I wish to recall the sudden passing
of our late Vice Chaiman, Vincent Curmi on the
12th December 2023. Vincent sat on the board
of Directors of Simonds Farsons Cisk plc for over
30 years. He gave me and previous Chairmen
pivotal support through his wide ranging
contribution, but most specifically through his
profound knowledge of property related issues.
He knew the subject well, and as Vice Chairman
of Trident Estates plc he took an active part
particularly in advising the CEO on difficult
issues. We shall surely miss him, and we extend
our condolences to his dear wife Kathleen for
her tragic loss. His contributions to the Group
have had an invaluable and lasting impact for
which I will always be grateful.
I conclude on an optimistic note. Trident Estates
plc is in good shape. It has a number of prized
properties in its portfolio. As M alta ’s sought after
and premier office destination, Trident Park is
undoubtedly its prime asset, which is proving
to be a very good investment with potential to
develop further. We are confident that we can
deliver improved results next year.
Thanks are also due to my boardroom colleagues
for their unwavering belief in the investment
just completed. A particular thank you goes
to our CEO Charles Xuereb for his hard work
and commitment throughout the project. He
has shown his versatility at being both able to
be project minded and commercially highly
competent in securing the high occupancy
levels that are being achieved. He has been ably
assisted by our CFO Andrea Mangion. Director
Michael Farrugia has also provided significant
hands-on contribution to our success in both the
Trident Park and Brewhouse projects.
Further thanks are due to our legal advisors
Mamo TCV and our auditors PwC.
Louis A. Farrugia
Chairman
30 May 2024
ChairmaN’S STaTEmENT 05
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
BOARD OF DIRECTORS
FROM LEFT TO RIGHT – Ms Nadine Magro – Company Secretary, Mr Michael Farrugia, Mr Charles Borg,
Mr Louis A Farrugia – Chairman, Mr Neil Psaila, Mr Roderick Chalmers, Mr Alberto Miceli Farrugia, Mr Matthew Marshall.
PICTURED RIGHT – Prof. Avv. Alberto Stagno d’Alcontres
– Director, up to 23 May 2024
PICTURED FAR RIGHT – Mr Andrea Stagno d’Alcontres – Director, from 23 May 2024
06 BOarD OF DirECTOrS
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
BOARD OF DIRECTORS
BOARD COMMITTEES
SENIOR MANAGEMENT AND BOARD
COMMITTEES
Trident Team – Senior Management, Operations and Maintenance staff
SENIOR MANAGEMENT
Mr Charles Xuereb – Chief Executive Officer
Mr Andrea Mangion – Chief Financial Officer
aUDiT COmmiTTEE
Mr Roderick Chalmers – Chairman
Mr Charles Borg
Mr Vincent Curmi
up to 12 December 2023
Mr Neil Psaila
from 5 January 2024
Mr Alberto Miceli Farrugia
Mr Louis A. Farrugia – Chairman
Mr Vincent Curmi – Vice Chairman
up to 12 December 2023
Mr Roderick Chalmers
Mr Charles Borg
Mr Michael Farrugia
Mr Alberto Miceli Farrugia
Prof. Avv. Alberto Stagno d’Alcontes
up to 23 May 2024
Mr Andrea Stagno d’Alcontes
from 23 May 2024
Marquis Marcus Marshall
up to 5 January 2024
Mr Matthew Marshall
from 5 January 2024
Mr Neil Psaila
from 5 January 2024
rELaTED ParTiES
TraNSaCTiON
COmmiTTEE
Mr Vincent Curmi – Chairman
up to 12 December 2023
Mr Charles Borg – Chairman
from 3 May 2024
Mr Alberto Miceli Farrugia
Mr Matthew Marshall
from 3 May 2024
rEmUNEraTiON
aND COrPOraTE
GOVErNaNCE
COmmiTTEE
as from 3 May 2024 incorporating the
Remuneration Committee, the Nomination
Committee, and the Board Performance
Evaluation Committee
Mr Charles Borg – Chairman
Mr Michael Farrugia
Mr Matthew Marshall
Prof. Avv. Alberto Stagno d’Alcontes
up to 23 May 2024
Mr Vincent Curmi
1942 – 2023
Mr Curmi served as Director of the
Company since its incorporation
in 2000 and held the post of Vice
Chairman since October 2017.
He was also appointed to the Board
of Simonds Farsons Cisk p.l.c.,
between 1978 and 2015 whereby
he also occupied the post of Vice
Chairman between 2003 and 2015.
SENiOr maNaGEmENT aND BOarD COmmiTTEES 07
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
CHIEF EXECUTIVE OFFICER’S
REVIEW
FiNaNCiaL rESULTS
Revenues for the Group for the financial
year under review amounted to €4.2 million,
representing an increase of 79% compared to
the turnover figure of €2.4 million reported in
financial year ending 31 January 2023 (FY2023).
This is due to new rental income coming on stream
as tenants progressively move into Trident Park.
Operating profits for the year amounted to
€2,206,000 (FY2023: €1,267,000). Fair value
gains amounting to €585,000 (FY2023:
€6,749,000) were registered on our investment
property portfolio (see below for details).
Profit before taxation for the year amounted to
€1,295,000, (FY2023: €7,486,000). The higher
level of profits in FY2023 resulted from the
significant unrealised fair value gains on the
property portfolio. The tax charge for the year
amounted to €243,000 (FY2023: €912,000) and
includes a deferred tax charge on the fair value
gain of €59,000.
As anticipated in last year’s annual report, the
sharp increase in the European Central Bank
(ECB) reference (interest) rate over 2022 and
2023 has had an impact on our borrowing costs
which amounted to €1,305,000 for the year
(FY2023: €785,000). The past year has seen
Inflation in Europe gradually come down, and it
is now within sight of the ECB’s inflation target of
“at or close to 2%”. Although the ECB reference
rate remains elevated at 4.5%, the expectation
is that this will gradually come down over the
second half of (calendar) 2024 with three cuts of
25 basis points each being forecast. However, it
may take some time before we see the benefit of
this reduction in our overall borrowing costs.
I am pleased to present to you the Company’s Annual Report for
the financial year ended 31 January 2024 (FY2024) – our seventh
year since we first listed the Company on the Malta Stock Exchange
on 30 January 2018. The year under review has seen continuing
interest in Trident Park, resulting in a further increase in occupancy
level. We have also seen a number of changes in tenancies in
other Group properties resulting in higher rental incomes.
€0
€1,000,000
€2,000,000
€3,000,000
€4,000,000
€5,000,000
2024202320222021
REVENUE
€0
€400,000
€800,000
€1,200,000
€1,600,000
€2,000,000
2024202320222021
OPERATING PROFITS
€0
€200,000
€400,000
€600,000
€800,000
2024202320222021
PROFIT BEFORE TAX AND
FAIR VALUE MOVEMENTS
08 ChiEF ExECUTiVE OFFiCEr’S rEViEw
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
ChiEF ExECUTiVE OFFiCEr’S rEViEw 09
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
OFFiCiaL iNaUGUraTiON
The completion of the magnificent Trident Park
project in 2023 was an important milestone,
culminating in the grand inauguration on June
28, 2023. This event was met with widespread
critical acclaim, even garnering praise from the
editorials of various newspapers. Construction
works on the project started in the second
quarter of 2018 and we commenced welcoming
tenants in Q1 of 2022.
Having responsibility for managing the complex
construction project, marketing its various
spaces, and securing tenants has been an
exhilarating and transformative experience
for the small and tight knit executive team. It
represented a total immersion experience in
the complexities of large-scale development
and innovation, strategic decisions, intricate
(and sometimes difficult) negotiations, and the
constant need to balance the pursuit of revenue
with the vision of creating a truly outstanding
finished project and an exceptional working
environment. Throughout this journey, we have
witnessed the power of collaboration, resilience,
and commitment of a dedicated team.
Together the team navigated through
unforeseen challenges - the Covid-19 pandemic
and restrictions followed by the war in Ukraine
and its ensuing financial turmoil. These
obstacles tested the team to its limits, but also
strengthened our resolve to bring Trident Park
to fruition.
As we look back on these past 5 years, we are
filled with a deep sense of pride at what has been
achieved. The vision set by the Board for Trident
Park centred around enhancing employee
satisfaction and well-being, had become a
reality.
“AS I LOOK BACK ON THESE
PAST 5 YEARS I AM FILLED
WITH A DEEP SENSE OF PRIDE
AND ACCOMPLISHMENT”
10 ChiEF ExECUTiVE OFFiCEr’S rEViEw
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
The bold decision to develop only 43% of the
site, sacrificing potential revenue-generating
spaces, was questioned by many at the time.
However, we now see the wisdom of that
choice in a market that is over-supplied with
conventional office space.
The open landscaped areas and vibrant themed
gardens incorporated in Trident Park create a
dynamic working environment, flooded with
uplifting natural lighting, whilst integrating
environmentally friendly technologies and thereby
creating a thriving ecosystem where businesses
can flourish, and employees can thrive.
The landmark colonnade and the main entrance
to what used to be the Farsons Brewery have
been meticulously restored, as has the original
boardroom, now fittingly named after Lewis
V. Farrugia as a tribute to his vision in post-
war Malta. Additionally, we have unveiled the
Trident Park Conference Hall as a new extension,
accommodating 170 guests with the first
conference being held in February 2023.
We have also embraced innovative,
environmentally friendly technologies.
As we have transitioned to the operational
phase, we are actively assisting new tenants
in finalizing their setups within our premises.
Noteworthy additions to our facility include a
state-of-the-art gym, childcare services, and a
dental and medical aesthetics clinic.
Our community has grown richer and more
diverse with the inclusion of new tenants such
as Wolt, Ascent, Lidion Bank, Elit’Avia, Antes,
Argus, Surge Advisory, Supercharger Ventures,
MSM, Schembers and Compre. These esteemed
organizations now stand alongside our existing
tenants, forming a vibrant and diverse business
ecosystem within the development. We
anticipate that occupancy levels will reach 83%
by summer when our new tenants will occupy
their spaces, further enhancing the vibrancy
of our community. The collective vision and
synergy within our community continue to drive
us towards excellence and innovation. Naturally
as the spaces are occupied, the working
environment radiates a sense of success.
We are committed to working diligently to
ensure the continued success and growth of our
organization.
“THE COLLECTIVE VISION AND
SYNERGY WITHIN OUR COMMUNITY
CONTINUE TO DRIVE US TOWARDS
EXCELLENCE AND INNOVATION”
ChiEF ExECUTiVE OFFiCEr’S rEViEw 11
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
12 ChiEF ExECUTiVE OFFiCEr’S rEViEw
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
awarDS
In the realm of architectural achievement and
innovative urban planning, few projects stand
out with such resounding acclamation as Trident
Park. It is a project that has swept through
the prestigious award circuits, leaving a trail
of accolades in its wake. The project has also
won international recognition including the UK
organised Civic Trust Awards. The latter, a beacon
of excellence in architectural recognition, has
bestowed upon this project the prestigious title
of “Highly Commended.” The judges’ remarks echo
the sentiments of many who have witnessed the
project’s metamorphosis - a revitalization that
breathes new life into an iconic cultural heritage
building. This commendation is a testament
to the project’s significant contribution to the
enhancement of Malta’s built environment.
The Architecture Master Prize, a prestigious
platform celebrating architectural prowess, has
honoured this project with an “Honourable Mention”
in the Mixed Use category. This recognition
underscores the project’s innovative design and
its seamless integration of diverse functionalities
into a harmonious whole.
At the local Din l-Art Ħelwa Architectural Heritage
Awards event, Trident Park (together with the
Brewhouse) also won acclaim securing the
coveted Judge Maurice Caruana Curran Award.
This award, named after the founder of Din l-Art
Ħelwa, recognized the project’s exceptional quality,
historical significance, and positive impact on the
community. Additionally, the project received the
Prix d’Honneur for the Regeneration of an Area
category, further consolidating its place as a beacon
of architectural rejuvenation.
Recognizing the project’s commitment to
environmental sustainability and aesthetic appeal,
the Green Apple Environment Award has honoured
it as a Silver Winner. This acknowledgment
highlights the project’s dedication to creating
beautiful structures that coexist harmoniously
with nature.
The project’s nomination at the UK WAFX Awards
in the Re-Use category cements its reputation
as a pioneer in adaptive reuse. This accolade
celebrates the project’s ability to breathe new life
into existing structures, showcasing a deep respect
for architectural heritage and sustainability.
The Times of Malta editorial published on 4th
July 2023 captured the essence of why this
remarkable project achieved universal acclaim. It
highlighted the project’s transformative impact, its
ability to seamlessly blend history with modernity,
and its role in revitalizing the cultural fabric of
the community. The editorial resonated with
readers, painting a vivid picture of a project that
transcends mere architecture to become a symbol
of innovation, preservation, and community spirit.
The awards and editorial acclaim referred to above
are a testament to Trident Park’s impact on the built
environment and the community it serves. It stands
as a shining example of what can be achieved
when architecture, heritage, sustainability and
community converge in perfect harmony.
The application process for attaining BREEAM
(Building Research Establishment Environmental
Assessment Method) certification is a
comprehensive journey, expected to reach fruition
within the next year or so, with aspirations set on
achieving a high grade. The process included
a meticulous evaluation of the building’s
environmental, social, and economic sustainability
performance benchmarked against the rigorous
standards set by BREEAM. The anticipation of
achieving a high grade is not just a testament to the
building’s sustainable features but also a reflection
of a commitment to innovation, resilience, and
leadership in environmental stewardship, setting
a benchmark for future developments.
DIN L-ART ĦELWA XVII ARCHITECTURAL HERITAGE AWARDS
COMPETITION – Photo, from left, Mr John Bonello Ghio –
Head of The Brewhouse, Mr Charles Xuereb - Trident Estates
Chief Executive Officer, Ms Simone Mizzi from Din L-Art
Ħelwa, Mr Michael Farrugia - Director of Trident Estates plc
and Simonds Farsons plc, Mr Brendon Muscat, Partner and
Architect at TBA Periti, and Mr Martin Spiteri, Curator and
Collections Manager at Simonds Farsons Cisk plc..
CIVIC TRUST AWARDS – Left to right - Jonathan Shaw from Ritchie*Architects
with Trident Director Michael Farrugia at The Concorde Conference Centre in
Manchester, UK, where the award ceremony was held on 22nd March, 2024.
ChiEF ExECUTiVE OFFiCEr’S rEViEw 13
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
14 ChiEF ExECUTiVE OFFiCEr’S rEViEw
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
OPERATIONAL MODE
Over FY2024, our team was particularly focused
on the operational side of the development
as new tenants took up occupancy, gradually
populating the campus. Strong technical support
was provided to incoming tenants concerning
their fit-out requirements. Concurrently, our
campus continued to attract a lot of interest from
prospective new tenants and many on-site viewings
and presentations have been held.
PROJECT MANAGEMENT
The relationship with our clients and tenants
takes on a multifaceted role, encompassing lease
negotiations, supplier collaboration, and the
meticulous execution of office finishes. Tenant
satisfaction lies at the heart of our endeavour and
through a deep understanding of tenant needs,
we aspire to ensure that every aspect of the office
space aligns with the vision and requirements of
the occupants.
Supplier management also plays a crucial role in
the operation of projects. By cultivating strong
relationships with suppliers and holding them to
the highest standards of quality and reliability,
we seek to ensure that the materials and services
procured contribute to the overall excellence of
the finished product.
With a keen eye for detail and a dedication to
precision, every element of the office space is
meticulously crafted to exceed the expectations of
our tenants. We continue to set a new standard for
modern workspace environments, where comfort,
functionality and style converge seamlessly.
THE OFFICE MARKET
The office market in Malta is currently experiencing
challenges as the growing supply of office space
outweighs demand. This is the result of a period
when a significant stock of new office buildings
came on the market at a time when the working
from home phenomenon has gathered momentum.
We are privileged that at time of writing our signed
lease agreements account for 83% occupancy. We
believe that this has been achieved because of the
distinctive features of the Trident Park development,
not least as a result of the green credentials, open
spaces, natural light, as well as the availability of
parking and other quality amenities.
In the current market conditions, prospective
tenants are looking for the flexibility of remote work
options and, in a world where it is an employee’s
market, those who do not offer this possibility
often find themselves in having difficulty to recruit
and/or retain their employees. We believe that
the office environment will significantly influence
the corporate culture and the lifestyle they aim
to promote, ultimately impacting employee
engagement and satisfaction.
GOING FORWARD
As we work with new tenants to take up their
leased office spaces in the coming months, we
shall continue to focus on attaining operational
excellence, which is a not an easy feat across a
complex of our size. Our goal of the coming year
will be to continue to work on attaining close to
full occupancy at Trident Park through attracting
additional high-quality tenants.
Soon we will turn our attention to the next phase
of Trident Estates’ development.
ChiEF ExECUTiVE OFFiCEr’S rEViEw 15
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
16 ChiEF ExECUTiVE OFFiCEr’S rEViEw
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
OTHER DEVELOPMENTS
TRIDENT HOUSE
The Trident House premises on the outskirts of
Qormi are currently leased out to a related entity,
with the tenant expected to vacate the premises
in 2026. We are currently evaluating the options
for the site post 2026. The potential for the site
has been recognised by other third parties and a
number of enquiries and expressions of interest
have been received. These enquiries are currently
being assessed by the Board as part of a strategic
review that is underway.
EX SCOTSMAN’S PUB,
EX PIZZA HUT BISAZZA AND
EX PIZZA HUT ST. JULIANS
The ex-Scotsman’s pub in St. Julians that was
renamed Black Rabbit and operated for a relatively
short period by a new operator, has since changed
hands and is now being leased and operating
as Dave’s Convenience Store, forming part of a
successful chain of stores spread around the island.
The outlet has been completely refurbished.
Further to a request by a related company to
early terminate the lease agreements of the ex-
Pizza Hut outlets in Bisazza Street, Sliema and
in St. Julians, we have engaged with a number
of estate agents and made direct contacts to
assess the interest in the said properties. We
have successfully managed to lease out both
properties to new tenants. The outlet in Bisazza
Street has been gutted out and refurbished into
(another) Dave’s Convenience Store. The outlet in
St. Julians has been leased out to Kebab Factory,
a local franchise that also operates a number of
outlets in Malta. The refurbishment is currently
taking place and it is anticipated that the outlet
will open in the coming months.
The new commercial agreements are in line with
the current market rates, reflecting an improved
rental over the previous agreements.
CONCLUSION
In conclusion, our performance over the past year
has met our expectations and underscored our
team’s resilience and unwavering commitment to
excellence. As we mark our achievements, we are
also keenly aware that the path ahead requires us
to adapt and evolve. Therefore, we are embarking
on a comprehensive strategic review to ensure
our continued growth and success in the dynamic
market landscape. We look forward to shaping
a future that not only meets but exceeds our
collective expectations.
I want to extend my sincere gratitude to all those
who have contributed to the success of Trident Park
– the executive team, our consultants, contractors
and suppliers. As the Chairman already mentioned
in his statement, the Group suffered the tragic loss
of our Vice Chairman Mr Vincent Curmi. I am forever
grateful to Mr Curmi for his unwavering support
and mentorship he has provided me over the last
several years of our group’s journey. My gratitude
also goes to the Chairman and Board of Directors
– I feel privileged to have been entrusted with this
task. A special thank you to our Chairman for his
guidance and vision and to my small but dedicated
team. Their unwavering support, expertise, and
hard work have been instrumental in shaping
Trident Park into what it is today – Malta’s pre-
eminent office destination.
ChiEF ExECUTiVE OFFiCEr’S rEViEw 17
ANNUAL REPORT 2023/24
TRIDENT ESTATES PLC
ANNUAL REPORT 2022/23
TRIDENT ESTATES PLC
18 ChiEF ExECUTiVE OFFiCEr’S rEViEw
CONSOLIDATED
FINANCIAL
STATEMENTS
2023/24
20—22
DIRECTORS’ REPORT
23—28
CORPORATE GOVERNANCE
STATEMENT
29—32
REMUNERATION REPORT
33—34
STATEMENTS OF
FINANCIAL POSITION
35
STATEMENT OF
COMPREHENSIVE INCOME
36
STATEMENTS OF
CHANGES IN EQUITY
37
STATEMENTS OF CASH FLOWS
38—62
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
63
SHAREHOLDER INFORMATION
64—70
INDEPENDENT
AUDITOR’S REPORT
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
19
DIRECTORS’ REPORT
The Board of Directors is pleased to present their report and the Group’s
audited consolidated financial statements for the year ended 31 January 2024
rEViEw OF ThE BUSiNESS
Trading Performance
The Group’s revenue for the year increased substantially to
€4,216,000 (2023: €2,354,000). As in the previous year, the
increase in revenue is primarily attributable to the increasing
occupancy at Trident Park. A number of other leases within
the Group’s portfolio have been terminated and replaced with
equivalent or more favourable rates for the Group.
The Group’s operating costs increased to €2,066,000 (2023:
€1,141,000), with the increase being attributable to the expanding
operations at Trident Park. These additional costs are attributable to
the management and maintenance of the common areas of Trident
Park, utility costs, and the management of other revenue generating
activities such as the car park and the conference facility.
The Group’s finance costs increased to €1.4 million (2023:
€531,000). These costs reflect a full year of interest costs whereas
in the prior year, a proportion of interest costs were capitalised
as part of investment property. Furthermore, interest rates over
the year rose substantially in Europe as well as in several other
major economic areas as central banks made efforts to curb rising
inflation. The Group was not immune the upward pressure in
operational, capital or interest costs, although substantial efforts
have been devoted towards containing these pressures.
The Group registered a net fair value gain across its property
portfolio of €585,000 (2023: €6,749,000) and a corresponding
deferred tax expense of €58,500 (2023: €675,000). Prior to any
fair value gains, the Group registered a profit before tax of €710,000
(2023: €737,000) and a net profit after tax of €525,000 (2023:
€500,000). The total comprehensive income for the year (including
fair value gains) amounted to €1,052,000 (2023: €6,574,000).
Shareholder’s equity as at the year-end amounted to €60.8 million
(2023: €59.7 million). The Group continued to draw down on
available bank facilities, resulting in bank borrowings increasing
to €27.6 million (2023: €25.2 million) in order to fund retentions
and other works on the Trident Park development. As at year end,
the Group had available undrawn bank facilities totalling €4 million
(2023: €3.3 million), which are earmarked for financing remaining
retentions and finishing works of the Trident Park project, as well as
general working capital requirements of the Group.
Investments and property interests
Trident Park
During the year, the property’s occupancy continued to increase as
leases were concluded and tenants moved into the building. Works
carried out to the property were mainly related to the finishing
works of various tenancies, some of which were still ongoing after
year end, after which point signed on tenants would be ready to
move into the respective space. As at year end, over 40% of the
property was physically occupied by tenants whose lease contracts
had commenced, and another 40% of the lettable space was
committed and signed up with tenants that were carrying out
finishing works to their respective areas.
Management continues its endeavour to optimise the operations of
the building with a focus on maximising tenant satisfaction as well
as the project’s green credentials. Management is now pursuing
the BREAAM certification for the building whilst actively marketing
the remaining unoccupied spaces. As at the date of this report
83% of the total space had been taken up pursuant to signed lease
agreements with 64% being physically occupied.
Trident House
Trident House is the second largest property in the Group’s
portfolio in terms of asset value. The property provides an array
of potential options including sale or redevelopment, each with
varying financing requirements and potential opportunities for
enhancing shareholder returns. The Board has commissioned an
independent review of the development potential of the property
as well as having received a number of enquiries from the market.
At this time, the Board is considering all options as to how to best
utilise this property in the most strategically beneficial way.
Fortizza (Sliema Point Battery)
The Sliema Point Battery building is an artillery battery built by the
British in the 1870s on the Sliema waterfront. The property is leased
by the Group on temporary emphyteusis with 39 years remaining.
The property is sublet to a restaurant operator, the lease for which
is nearing its expiry (September 2024).
As part of the Board’s overarching strategic review, Management
is tasked with reviewing potential opportunities for the property.
Furthermore, an assessment is also underway on the works and
capital costs required for the restoration of the building’s façade.
The Board and management acknowledge that this landmark
historic building has great potential, whilst mindful of the
complexities and significant costs that would have to be incurred in
20 DirECTOrS’ rEPOrT
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
any restoration project. Management is also exploring all potential
options concerning the financing thereof.
Other properties
During the financial year, the premises formerly known as KFC
Gzira was occupied by a new tenant with a lease at a more
favourable rate commencing from 1st July 2023.
Furthermore, the leases of ex-Pizza Hut Sliema and Black Rabbit St
Julian’s, were terminated. These two properties are now being leased
to a common tenant operating the Dave’s Convenience chain.
Subsequent to the end of the financial year, the tenant formerly
occupying the Pizza Hut property in St Julian’s has opted to
relocate the operation and expressed desire to terminate the
lease agreement. Following this, management found a new tenant
for the property, signing a lease at better rates and for a longer
timeframe than that previously signed with the prior tenant, whilst
simultaneously terminating the previous lease agreement.
OUTLOOK FOr FiNaNCiaL YEar
ENDiNG 31 JaNUarY 2025
As we look forward to the upcoming financial year, it is important
that we assess prevailing market conditions. The current situation
is that there exists an over-supply of office space with new
developments coming on stream coinciding with the prevailing
work from home (WFH) culture. We are fortunate to be able to
record signed leases equivalent to 83% of available space – and
this is thanks to the unique quality and attributes of the Trident
Park development. Management continues in its endeavours to let
the balance of the remaining space. Furthermore, current levels of
over-supply necessitates the adoption of a cautious approach in the
assessment of the Group’s investment strategy going forward. In
the meantime, Management will closely monitor operational costs
which have inevitably been subjected to inflationary pressures.
Notwithstanding these formidable economic challenges, the Group
remains resilient, bolstered particularly by Trident Park’s high
occupancy rates and the stability offered by our medium and long-
term leases with high quality tenants. The other properties in the
Group’s portfolio are also tenanted (with minimal vacancy rates)
and are unencumbered. These factors will collectively allow the
Group to navigate the challenging economic year ahead.
FiNaNCiaL riSK maNaGEmENT
The Group’s and Company’s activities expose it to a variety of
financial risks, including market risk (including fair value interest
rate risk and cash flow interest rate risk), credit risk and liquidity
risk. Refer to Note 2 in these financial statements.
PrOPErTY VaLUE riSK aND ExPOSUrE
TO GENEraL marKET CONDiTiONS
Property values, including the health of the commercial property
rental market, are affected by changing demand, changes in
general economic conditions, changing supply within a particular
area of competing space and attractiveness of real estate relative
to other investment choices. Other factors such as changes in
planning and tax laws, and interest and inflation rate fluctuations
would also have an impact on capital values and income streams
of properties. The Company monitors all these factors, and seeks
advice accordingly, as it manages its property portfolio.
DiViDENDS aND rESErVES
The statements of comprehensive income are set out on page 35.
The Board of Directors did not declare an interim dividend during
the financial year just ended (2023: nil) and is not proposing to
recommend the declaration of a final dividend at the forthcoming
Annual General Meeting of the Company (2023: nil).
Retained profits carried forward at the reporting date amounted
to €5.9 million (2023: €5.4 million) for the Group and €5.3 million
(2023: €5.1 million) for the Company.
DirECTOrS
The Directors who held office during the year were:
Louis A. Farrugia – Chairman
Vincent Curmi – Vice Chairman - up to 12th December 2023
Alberto Miceli Farrugia
Alberto Stagno d’Alcontres - up to 23rd May 2024
Charles Borg
Marquis Marcus John Scicluna Marshall - up to 5th January 2024
Michael Farrugia
Roderick Chalmers
Neil Psaila - appointed on 5th January 2024
Matthew Marshall - appointed on 5th January 2024
Andrea Stagno D’Alcontres - appointed on 23rd May 2024
STaTEmENT OF DirECTOrS’ rESPONSiBiLiTiES
FOr ThE FiNaNCiaL STaTEmENTS
The Directors are required by the Maltese Companies Act, 1995 to
prepare financial statements which give a true and fair view of the
state of affairs of the Group and the parent Company as at the end
of each reporting period and of the profit or loss for that period.
In preparing the financial statements, the Directors are responsible for:
• ensuring that the financial statements have been drawn up in
accordance with International Financial Reporting Standards as
adopted by the EU;
• selecting and applying appropriate accounting policies;
•
making accounting estimates that are reasonable in the circumstances;
• ensuring that the financial statements are prepared on the
going concern basis unless it is inappropriate to presume that
the Group and the parent Company will continue in business as
a going concern.
The Directors are also responsible for designing, implementing and
maintaining internal control as necessary to enable the preparation of
financial statements that are free from material misstatement, whether
DirECTOrS’ rEPOrT 21
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
due to fraud or error, and that comply with the Maltese Companies
Act, 1995. They are also responsible for safeguarding the assets of the
Group and the parent Company and hence for taking reasonable steps
for the prevention and detection of fraud and other irregularities.
The financial statements of Trident Estates plc for the year ended
31 January 2024 are included in the Annual Report 2024, which is
available on the Company’s website. The Directors are responsible for
the maintenance and integrity of the Annual Report on the website
in view of their responsibility for the controls over, and the security
of, the website. Access to information published on the Company’s
website is available in other countries and jurisdictions, where
legislation governing the preparation and dissemination of financial
statements may differ from requirements or practice in Malta.
The Directors confirm that, to the best of their knowledge:
• the financial statements give a true and fair view of the financial
position of the Group and the parent Company as at 31 January
2024, and of the financial performance and the cash flows for
the year then ended in accordance with International Financial
Reporting Standards as adopted by the EU; and
• the Annual Report includes a fair review of the development and
performance of the business and the position of the Group and the
parent Company, together with a description of the principal risks
and uncertainties that the Group and the parent Company face.
SharEhOLDEr rEGiSTEr iNFOrmaTiON
PUrSUaNT TO CaPiTaL marKETS rULE 5.64
Share capital information of the Company is disclosed in Note 10 of
the financial statements on page 53.
The issued share capital consists of one class of ordinary shares
with equal voting rights attached and freely transferable. The list
of shareholders holding 5% or more of the equity share capital is
disclosed in this Annual Report.
Every shareholder owning twelve (12%) of the ordinary issued share
capital of the Company or more shall be entitled to appoint one
director for each and every twelve per cent (12%) of the ordinary share
capital owned by such shareholder and such shareholder may remove,
withdraw or replace such director at any time. Any appointment,
removal, withdrawal or replacement of a director to or from the Board
shall take effect upon receipt by the Board or the Company secretary
of a notice in writing to that effect from the shareholder owning twelve
per cent (12%) of the ordinary issued share capital of the Company or
more. Any remaining fractions will be disregarded in the appointment of
the said directors but may be used in the election of further directors at
an Annual General Meeting. The Chairman is appointed by the directors
from amongst the directors appointed or elected to the Board.
The rules governing the appointment, election or removal of directors
are contained in the Company’s Articles of Association, Articles 93 to
102. An extraordinary resolution approved by the shareholders in the
general meeting is required to amend the Articles of Association.
The powers and duties of directors are outlined in Articles 84 to 91 of
the Company’s Articles of Association. In terms of Article 12 of the said
Articles of Association, the Company may, subject to the provisions of
the Maltese Companies Act, 1995 acquire or hold any of its shares.
The Company does not have a Collective Agreement regulating
redundancies, early retirement, resignation or termination of
employment of employees. No employment contracts are in place
between the Company and its directors, except as disclosed in the
Remuneration Report.
It is hereby declared that, as at 31 January 2024, the Company
is not party to any significant agreement pursuant to Capital
Markets Rule 5.64.10.
Furthermore, the Board declares that the information required under
Capital Markets Rules 5.64.5 and 5.64.7 is not applicable to the
Company.
rEmUNEraTiON rEPOrT
The Remuneration Report is set out on pages 29 to 32 of this
Annual Report and sets out details of the terms of reference and
membership of the Remuneration Committee and the Remuneration
strategy and policy of the Trident Group. The Remuneration Report
also sets out the required details of the remuneration paid to
Directors and the Group Chief Executive and of senior management.
In accordance with Capital Market Rules 12.26L and 12.26M, the
Remuneration Report will be subject to an advisory vote by the
Shareholders at the forthcoming Annual General Meeting (AGM)
and will be made available on the Company’s website for a period of
10 years thereafter. The contents of the Remuneration Report have
been reviewed by the external auditors to ensure that it confirms
with the requirements of the Capital Market Rules.
aUDiTOrS
The auditors, PricewaterhouseCoopers, have indicated their
willingness to continue in office, and a resolution for their re-
appointment will be proposed at the Annual General Meeting.
Signed on behalf of the Board of Directors on 30 May 2024 by
Louis A. Farrugia (Chairman) and Roderick Chalmers (Director) as per
the Directors’ Declaration on ESEF Annual Financial Report submitted
in conjunction with the Annual Financial Report.
Registered address:
22 DirECTOrS’ rEPOrT
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
CORPORATE GOVERNANCE STATEMENT
a. iNTrODUCTiON
This statement is being made by Trident Estates plc (“TE”)
pursuant to Capital Markets Rules 5.94 and 5.97 issued by the
Listing Authority of the Malta Financial Services Authority and
sets out the measures taken to ensure compliance with the Code
of Principles of Good Corporate Governance (the Code) contained
in Appendix 5.1 to Chapter 5 of the said rules. In terms of Capital
Market Rule 5.94, TE is obliged to prepare a report explaining how
it has complied with the Code.
TE acknowledges that the Code does not prescribe mandatory
rules but recommends principles so as to provide proper incentives
for the Board and TE’s management to pursue objectives that are
in the interests of the Company and its shareholders.
TE adheres to generally accepted standards of good corporate
governance encompassing the requirements for transparency,
proper accountability, and the fair treatment of shareholders. The
Board has therefore endorsed the Code of principles and adopted
it. As demonstrated by the information set out in this statement,
together with the information contained in the Remuneration
Report, TE believes that it has, save as indicated in the section
entitled Non-compliance with the Code, applied the principles in
compliance with the provisions of the Code. In the Noncompliance
section, the Board indicates and explains the instances where it
has departed from or where it has not applied the Code, as allowed
by the Code.
B. COmPLiaNCE wiTh ThE CODE
Principle 1: The Board
The Board’s role and responsibility is to provide the necessary
leadership, to set strategy and to exercise good oversight and
stewardship. In terms of the Memorandum of Association of TE, the
affairs of the Company are managed and administered by a board
composed of eight directors.
The Board is in regular contact with the Chief Executive Officer
through the Chairman in order to ensure that the Board is in receipt
of timely and appropriate information in relation to the business
of TE and management performance. This enables the Board to
contribute effectively to the decision-making process, whilst at the
same time exercising prudent and effective controls. Directors are
provided prior to each meeting with the necessary information and
explanatory data as may be required by the particular item on the
agenda. Comprehensive financial statements are also provided as
necessary. The Company uses the services of external legal advisors.
The Directors are entitled to seek independent professional advice at
any time at the Company’s expense where necessary for the proper
performance of their duties and responsibilities.
All Board Members are accountable for their performance to
shareholders and other stakeholders, attend regular Board
Meetings and allocate sufficient time to perform their duties. The
Board ensures integrity of transparency, operational controls and
compliance the relevant laws.
The Board delegates specific responsibilities to a number of
committees, notably the Related Party Transactions Committee, the
Audit Committee, and the Remuneration and Corporate Governance
Committee. Further detail in relation to the committees and the
responsibilities of the Board is found in Principles 4 and 5 and 8 of
this statement.
Corporate Governance is considered as a constitutive element
intertwined in all discussions and decisions undertaken at the
level of the Board and its Committees. This element had been
fundamental in creating the corporate culture of the Company,
setting the right tone at the top.
Principle 2: Chairman and Chief Executive
Officer
The statute of TE provides for the Board to appoint from amongst its
Directors a Chairman and a Vice-Chairman.
The Chairman is responsible to lead the Board and set its agenda,
ensure that the Directors of the Board receive precise, timely
and objective information so that they can take sound decisions
and effectively monitor the performance of the Company, ensure
effective communication with shareholders and encourage active
engagement by all members of the Board for discussion of complex
or contentious issues.
The role of the Chief Executive Officer is to ensure effective overall
management and control of Group business and proper co-ordination
of the activities undertaken by the Group, and is responsible:
1. for the formulation and implementation of policies and strategy
as approved by the Board;
2. to achieve the objectives of the Group as determined by the Board;
3. to devise and put into effect such plans and to organise,
manage, direct, and utilise the human resources available and
all physical and other assets of the Group so as to achieve the
most sustainable, economical efficient use of all resources
and the highest possible profitability in the interest of the
shareholders and all other stakeholders, whilst respecting
environmental and social factors.
The Chief Executive Officer reports regularly to the Board on the
business and affairs of the Group and the commercial, economic
and other challenges facing it. He is also responsible to ensure
that all submissions made to the Board are timely, give a true and
correct picture of the issue or issues under consideration, and are
COrPOraTE GOVErNaNCE STaTEmENT 23
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
of high professional standards as may be required by the subject
matter concerned.
The Chairman also chairs a weekly Executive Committee Meeting,
during which operational issues are discussed.
The above arrangements provide sufficient delegation of powers
to achieve effective management. The organisational structure
ensures that decision making powers are spread wide enough
to allow proper control and reporting systems to be in place and
maintained in such a way that no one individual or small group of
individuals actually has unfettered powers of decision.
Principle 3: Composition of the Board
Each member of the Board offers core skills and experience that are
relevant to the successful operation of the Company. Whilst relevance
of skills is key, a balance between skills represented is sought
through the work of the Nominations Committee to ensure that there
is an appropriate mix of members with diverse backgrounds.
The Board is composed of a Chairman, and seven other Non-
Executive Directors.
EXECUTIVE DIRECTORS
Mr Louis A. Farrugia – Chairman
NON-EXECUTIVE DIRECTORS
Mr Vincent Curmi – Vice Chairman – up to 12th December 2023
Mr Neil Psaila – from 5th January 2024
Mr Charles Borg
Mr Roderick Chalmers
Mr Michael Farrugia
Mr Alberto Miceli Farrugia
Marquis Marcus John Scicluna Marshall – up to 5th January 2024
Mr Matthew Marshall – from 5th January 2024
Prof. Avv. Alberto Stagno d’Alcontres – up to 23rd May 2024
Mr Andrea Stagno d’Alcontres – from 23rd May 2024
The Chief Executive Officer attends all board meetings, albeit
without a vote, in order to ensure his full understanding and
appreciation of the Board’s policy and strategy, and so that he
can provide direct input to the Board’s deliberations. The Board
considers that the size of the Board, whilst not being large as to
be unwieldy, is appropriate, taking into account the size of the
Company and its operations. The combined and varied knowledge,
experience and skills of the Board members provide a balance of
competences that are required and add value to the functioning of
the Board and its direction to the Company.
It is in the interest of each of the three major shareholders (who are
the original promoters of the Company) to nominate as directors,
knowledgeable, experienced and diligent persons.
Apart from this, informal arrangements, which do not infringe on
their rights as shareholders, exist for consultation prior to any
changes in the membership of the Board, as well as to assist in the
identification of suitable persons who can be nominated for election
by the other shareholders at general meetings, and who can bring
in an independent viewpoint and particular knowledge to the
deliberations of the Board. Family relationships among Directors,
the Directors’ interest in the share capital of the Company as
disclosed in the Shareholder Information and the commonality of
Directors with Simonds Farsons Cisk plc (“SFC”) with which the
Company maintains contractual relationships, represent potential
conflicts of interest.
This notwithstanding, all Directors are considered to be
independent in that they do not hold any relationship with the
Company, a controlling shareholder or their management which
creates a conflict of interest such as to impair their judgement.
This has been ensured through the implementation of the following
measures:
i. Disclosure and Exclusion: a Director is obliged to disclose
any matter that may give rise to a potential or actual conflict.
Following this, the respective Director is excluded from any
deliberations and voting in respect of such matter.
ii. Related Party Transaction Committee: with regards to any
transactions which may be determined to be related party
transactions, such transactions are referred to and dealt by the
Related Party Transaction Committee (the “Committee”). As
with the situation at Board level, any Director who is a related
party with respect to a particular transaction is not permitted
to participate in the Committee’s deliberation and decision on
the transaction concerned. Furthermore, due to the fact that
the most frequent matters on which a related party transaction
may arise would be in relation to a transaction with SFC, the
Committee is made up of Directors who are different members
from the boards of SFC and the Company respectively;
iii. Continuing Conflict: a Director having a continuing material
interest that conflicts with the interests of the Company
is obliged to take effective steps to eliminate the grounds
for conflict and should this not be possible, said Director is
encouraged to consider resigning.
iv. Separation of Family Interests: there are no ties or relationships
between management and the Directors
Principles 4 and 5: The Responsibilities of the
Board and Board Meetings
The Board meets regularly every month apart from other occasions
as may be needed. Individual directors, apart from attendance
at formal board meetings, participate in other ad hoc meetings
during the year as may be required, and are also active in board
sub-committees as mentioned further below, either to assure good
corporate governance, or to contribute more effectively to the
decision-making process.
Meetings held: ........................................................................................................13
Members Attended
Mr Louis A. Farrugia – Chairman ......................................................................13
Mr Vincent Curmi – Vice Chairman
(until 12th December 2024)
.......................................................................10 out of 12
Mr Neil Psaila
(from 5th January 2024) .................................................. 0 out of 1
24 COrPOraTE GOVErNaNCE STaTEmENT
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
Mr Charles Borg ..................................................................................................... 10
Mr Roderick Chalmers ........................................................................................ 13
Mr Michael Farrugia .............................................................................................12
Mr Alberto Miceli Farrugia .................................................................................13
Marquis Marcus John Scicluna Marshall
(until 5th January 2024)
............................................................................ 11 out of 12
(3 attended by an alternate director Mr Matthew Marshall)
Mr Matthew Marshall (from 5th January 2024) .................................... 1 out of 1
Prof. Avv. Alberto Stagno d’Alcontres ............................................................ 11
The Board, in fulfilling its mandate within the terms of the
Company’s Memorandum and Articles of Association, and
discharging its duty of stewardship of the Company and the Group,
assumes responsibility for the following:
• reviewing and approving the business plan and targets that are
submitted by management, and working with management in
the implementation of the business plan;
• identifying the principal business risks for the Group and
overseeing the implementation and monitoring of appropriate
risk management systems;
• ensuring that effective internal control and management
information systems for the Group are in place;
• assessing the performance of the Group’s executive officers,
including monitoring the establishment of appropriate systems
for succession planning, and for approving the compensation
levels of such executive officers; and
• ensuring that the Group has in place a policy to enable it to
communicate effectively with shareholders, other stakeholders
and the public generally.
The Board is ultimately responsible for the Company’s system
of internal controls and for reviewing its effectiveness. Such a
system is designed to manage rather than eliminate risk to achieve
business objectives, and can provide only reasonable, and not
absolute, assurance against material error, losses, or fraud.
Through the Audit Committee, the Board reviews the effectiveness
of the Company’s system of internal controls. In fulfilling its
responsibilities, the Board regularly reviews and approves various
management reports as well as annual financial plans, including
capital budgets. The strategy, processes and policies adopted for
implementation are regularly reviewed by the Board using key
performance indicators. To assist it in fulfilling its obligations, the
Board has delegated responsibility to the Chief Executive Officer.
Principle 6: Information and Professional
Development
The Chief Executive Officer is appointed by the Board and enjoys
the full confidence of the Board. The Chief Executive Officer,
although responsible for the recruitment and selection of senior
management, consults with the Board on the appointment of, and
on a succession plan for, senior management.
Training (both internal and external) of management and employees
is a priority, coordinated through the office of the Chief Executive
Officer. On joining the Board, a director is provided with briefings by
the Chairman and the Chief Executive Officer on the activities of the
Company’s business areas. Furthermore, all new directors are offered
a tailored induction programme. Directors may, where they judge it
necessary to discharge their duties as directors, take independent
professional advice on any matter at the Company’s expense.
Under the direction of the Chairman, the Company Secretary’s
responsibilities include ensuring good information flows within
the Board and its committees and between senior management
and Non-Executive Directors, as well as facilitating induction and
assisting with professional development as required.
Directors have access to the advice and services of the Company
Secretary, who is responsible for ensuring adherence to board
procedures, as well as good information flows within the Board
and its committees. The Chairman ensures that board members
continually update their skills and the knowledge and familiarity
with the Company required to fulfil their role both on the Board and
on the Board committees.
The Company provides the necessary resources for developing and
updating its directors’ knowledge and capabilities. The Company
Secretary is responsible for advising the Board through the
Chairman on all governance matters.
Principle 7: Evaluation of the Board’s
Performance
The evaluation of Board Performance is a responsibility of the
Remuneration and Corporate Governance Committee which is
chaired by a Non-Executive Director, is to deal with the Board’s
performance evaluation and identify ways how to improve the
Board’s effectiveness. Periodic evaluations of Board Performance
are conducted through a Board Effectiveness Questionnaire
prepared by the Company Secretary in liaison with the Chairman of
the Committee. The Company Secretary discusses the results with
the Chairman of the Committee who then presents the same to the
Board together with initiatives undertaken to improve the Board’s
performance and effectiveness. The latest review has not resulted
in any material changes in the Company’s internal organisation
or in its governance structures. Non-Executive Directors are
responsible for the evaluation of the Chairman of the Board.
Principle 8: Committees
The Board has set up the following subcommittees to assist it
in the decision-making process and for the purposes of good
corporate governance. The actual composition of these committees
is provided in the Annual Report, but as stated earlier, each of
the three major shareholders and the public shareholders are
represented as far as possible.
The Audit Committee’s primary objective is to protect the
interests of the Company’s shareholders and assist the directors in
conducting their role effectively so that the Company’s decision-
making capability and the accuracy of its reporting and financial
results are maintained at a high level at all times.
COrPOraTE GOVErNaNCE STaTEmENT 25
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
The Audit Committee is composed of four members – Mr Roderick
Chalmers (Chairman), Mr Neil Psaila, Mr Alberto Miceli Farrugia and
Mr Charles Borg – all being Non-Executive Directors. All directors
on the Audit Committee are independent and, in the opinion of
the Board, are free from any significant business, family or other
relationship with the Company, its shareholders or its management
that would create a conflict of interest such as to impair their
judgement.
Mr Roderick Chalmers and Mr Neil Psaila are professionally qualified
accountants with competence in matters relating to accounting
and auditing. The Audit Committee as a whole has extensive
experience in matters relating to the Company’s area of operations,
and therefore has the relevant competence required under Capital
Markets Rule 5.118. The Audit Committee oversees the conduct of
the external audits and acts to facilitate communication between the
Board, Management, and the external auditors.
The external auditors are invited to attend specific meetings of
the Audit Committee and are also entitled to convene a meeting
of the Committee if they consider that it is necessary so to do.
The Chairman, the Chief Executive Officer and the Chief Financial
Officer are also invited to attend Audit Committee meetings.
Members of management may be asked to attend specific
meetings at the discretion of the Audit Committee.
During the year ended 31 January 2024, the Audit Committee
held four meetings.
The Related Party Transactions Committee is presided over by
Non-Executive Director Mr Charles Borg and deals with and reports
to the Board on all transactions with related parties. In the case
of any director who is a related party with respect to a particular
transaction, such director does not participate in the Committee’s
deliberation and decision on the transaction concerned.
In view that the most frequent matters on which a related party
transaction may arise would be in relation to a transaction with
SFC, and that the Board of Directors of Trident Estates plc and that
of SFC have a number of common Directors, the Board of Directors
and the respective Related Party Transaction Committees in the
first instance delegate the day-to-day negotiations between
the two companies to the respective CEOs. The CEOs are fully
independent, act in the best interest of their respective company
and have no conflict of interest to impair their judgement. The
CEOs then report to the respective Related Party Transaction
Committees.
The Remuneration Committee and Corporate Governance
Committee (RCGC) is chaired by Non-Executive Director
Mr Charles Borg and is entrusted with leading the process
for evaluating the nomination of new directors and making
recommendations to the Board. The Committee is also responsible
for monitoring and reviewing the best corporate governance
practices and reporting thereon to the Board, including on the
annual review of the evaluation of Board Performance. From time-
to-time important matters relating to corporate governance are
elevated to and dealt with at full meetings of the Board at which
all Directors participate. Furthermore, the RCGC is responsible
for drawing up and proposing the Remuneration Policy to the
Company’s Board of Directors for its consideration and approval.
The Committee reviews and recommends all remuneration
packages (both fixed and discretionary) relating to Executive
Directors, Non-Executive Directors, and Senior Management. The
recommendations of the Remuneration and Corporate Governance
Committee in this regard are submitted to the full Board for
final approval. Individual Directors recuse themselves from any
participation as appropriate.
Principles 9 and 10: Relations with Shareholders
and with the Market, and Institutional
Shareholders
Every shareholder owning twelve percent (12%) of the ordinary
issued share capital or more, is entitled to appoint and replace a
director for each and every twelve (12%) of such shares, and the
remaining ordinary shares not so utilised are entitled to fill the
remaining unfilled posts of directors. Thus, each of the three major
shareholders who are named and whose holdings are listed in note
26 to the financial statements, normally each appoint two directors
for a total of six, the remaining two directors then being elected by
the general public shareholders. Accordingly, no individual or small
group of individuals will be in a position to dominate the Board.
The interests of the directors in the shares of the Company are
disclosed in this Annual Report.
The Company recognises the importance of maintaining a dialogue
with its shareholders and of keeping the market informed to ensure
that its strategies and performance are well understood. The
Board endeavors to protect and enhance the interests of both the
Company and its shareholders, present and future. The Chairman
ensures that the views of shareholders are communicated to the
Board as a whole.
The Board always ensures that all holders of each class of capital
are treated fairly and equally. The Board also acts in the context
that its shareholders are constantly changing and consequently,
decisions take into account the interests of future shareholders
as well. Shareholders appreciate the significance of participation
in the general meetings of the Company and particularly in the
election of directors. They hold directors to account for their
actions, their stewardship of the Company’s assets and the
performance of the Company.
The agenda for general meetings of shareholders and the conduct
of such meetings is arranged in such a manner to encourage valid
discussion and decision-taking.
The Chairman and the Chief Executive Officer also ensure that
sufficient contact is maintained with major shareholders to
understand issues and concerns.
The Company also communicates with its shareholders through
the Company’s Annual General Meeting (AGM) (further detail
is provided under the section entitled General Meetings).The
Chairman makes arrangements for the chairmen of the Audit and
the Remuneration and Corporate Governance Committees to be
available to answer questions, if necessary.
Apart from the AGM, TE communicates with its shareholders by
way of the Annual Report and Financial Statements, by publishing
its results on an annual basis.
26 COrPOraTE GOVErNaNCE STaTEmENT
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
The Company’s website (www.tridentestatesplc.com) also contains
information about the Company and its business, including an
Investor Relations section. In addition, the Company holds a
meeting for stockbrokers and financial intermediaries once a year
to coincide with the publication of its financial statements.
The Company Secretary maintains two-way communication
between the Company and its investors. Individual shareholders
can raise matters relating to their shareholdings and the business
of the Group at any time throughout the year and are given
the opportunity to ask questions at the AGM or submit written
questions in advance.
In terms of Article 51 of the Articles of Association of the Company
and Article 129 of the Maltese Companies Act, the Board may
call an extraordinary general meeting on the requisition of
shareholders holding not less than one tenth (1/10) of the paid-up
share capital of the Company. Minority shareholders are allowed to
formally present an issue to the Board.
In the event of conflicts arising between minority shareholders and
the three major shareholders, who are also the original promoters
of the Company, every effort shall be made to seek mediation.
Principle 11: Conflicts of Interest
The Directors are strongly aware of their responsibility to act at all
times in the best interest of the Company and its shareholders as a
whole and of their obligation to avoid conflicts of interest. The latter
may arise on specific matters. In such instances:
• a director is obliged to make full and frank disclosure with
respect to any matter where there is a potential or actual
conflict, whether such conflict arises from personal interests or
the interests of the companies in which such person is a director
or officer;
• the said director is excused from the meeting and accordingly is
not involved in the Company’s board discussion on the matter;
and
• the said director does not vote on any such matter.
A director having a continuing material interest that conflicts with
the interests of the Company, is obliged to take effective steps
to eliminate the grounds for conflict. In the event that such steps
do not eliminate the grounds for conflict then the director should
consider resigning.
On joining the Board and regularly thereafter, the directors
are informed of their obligations on dealing in securities of the
Company within the parameters of law, including the Capital
Markets Rules and the Market Abuse Regulations.
The directors’ interests in the share capital of the Company as
at 31 January 2024 and as at 30 April 2024 are disclosed in the
Shareholder Information.
Principle 12: Corporate Social Responsibility
The principal objective of the Company’s commitment to Corporate
Social Responsibility (CSR) is to provide support where possible
in aspects that include social, occupational, financial, cultural and
historical values.
C. NON-COmPLiaNCE wiTh ThE CODE
Principle 4 (Code Provision 4.2.7):
This Code Provision recommends “the development of a
succession policy for the future composition of the Board and
particularly the executive component thereof, for which the
Chairman should hold key responsibility”.
In the context of the appointment of directors being a matter
reserved exclusively to TE’s shareholders (except where the need
arises to fill a casual vacancy) as explained under Principle 3 of
this Report, and on the basis of the Directors’ non-executive role,
the Company does not consider it feasible to have in place such a
succession policy. However, the recommendation to have in place
such a policy is kept under review. An active succession policy is
however in place for senior executive positions in the Company
including that of the Chief Executive Officer.
D. iNTErNaL CONTrOL aND riSK
maNaGEmENT iNTErNaL CONTrOL
The key features of the Group’s system of internal control are as
follows:
Organisation:
The Board of Directors of the subsidiaries are made up of a
majority or all Board members of TE and general and common
issues are discussed across the board.
Control Environment:
TE is committed to the highest standards of business conduct
and seeks to maintain these standards across all of its operations.
Group policies and employee procedures are in place for the
reporting and resolution of fraudulent activities. The Group has
an appropriate organisational structure for planning, executing,
controlling and monitoring business operations in order to achieve
Group objectives.
Risk Identification:
Senior management is responsible together with the Board of
Directors, for the identification, evaluation, control and reporting of
major risks applicable to the business.
Reporting:
The Group has implemented control procedures designed to
ensure complete and accurate accounting for financial transactions
and to limit the potential exposure to loss of assets or fraud.
COrPOraTE GOVErNaNCE STaTEmENT 27
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
Measures taken include physical controls, segregation of duties and
reviews by management.
On a monthly basis the Board receives a comprehensive analysis of
financial and business performance, including reports comparing
actual performance with budgets as well as analysis of any variances.
E. GENEraL mEETiNGS
The manner in which the general meeting is conducted is outlined
in Articles 49 to 52 of the Company’s Articles of Association,
subject to the provisions of the Maltese Companies Act, 1995.
An Annual General Meeting of shareholders is convened within
seven months of the end of the financial year, to consider the
annual consolidated financial statements, the directors’ and
auditor’s report for the year, to decide on dividends recommended
by the Board, to elect the directors and appoint the auditors.
Prior to the commencement of the Annual General Meeting, a
presentation is made to shareholders on the progress made and
strategies adopted during the year in the light of prevailing market
and economic conditions, and the objectives set by the Board, and
an assessment on future prospects is given. The Group’s presence
on the worldwide web (www.tridentestatesplc.com) contains an
investor relations section.
Apart from the above, the Group publishes its financial results
every six months, and from time-to-time issues Company
Announcements or other public notices regarding matters
which may be of general interest or of material importance to
shareholders and the market in general, or which may concern
price sensitive issues.
At the time of the Annual General Meeting, public meetings are
held to which institutional investors, financial intermediaries and
investment brokers are invited to attend. Press releases are also
issued from time-to-time on the business activities of the Group.
All shareholders in the Shareholders’ Register on the Record
Date as defined in the Capital Markets Rules, have the right to
attend, participate and vote at general meeting. A shareholder or
shareholders holding not less than 5% of the voting issued share
capital may request the Company to include items on the agenda
of a general meeting and/or table draft resolutions for items
included in the agenda of a general meeting. Such requests are to
be received by the Company at least forty-six (46) days before the
date set for the relative general meeting.
A shareholder who cannot participate in the general meeting
can appoint a proxy by written or electronic notification to the
Company. Every shareholder represented in person or by proxy is
entitled to ask questions which are pertinent and related to items
on the agenda of the general meeting and to have such questions
answered by the Directors or such persons as the Directors may
delegate for that purpose.
F. CODE OF CONDUCT
The Code of Conduct for TE employees was introduced in 2020.
The basic principles of the Company are a legacy of SFC and the
code reflects the same values of Success, Teamwork, Respect,
Integrity, Dynamism and Excellence which are abbreviated by the
acronym S.T.R.I.D.E.
TE’s reputation depends on how each of its employees conduct
themselves both individually and collectively as a company.
Therefore, the Code of Conduct is intended to serve as general
guidance for all employees who are expected to “do the right
thing” and to ensure the highest standards of integrity, mutual
respect and cordiality contributing to an ethical and professional
environment.
The Code of Conduct makes it clear that the Board condemns
any form of bribery and corruption, improper payments as well
as money-laundering and has a zero-tolerance attitude to fraud
malpractice and wrongdoing, and a commitment to ethics and best
practice.
TE employees have a responsibility to voice their concerns when
they suspect/know that their superiors/colleagues are involved in
something improper, unethical, or inappropriate or have potentially
infringed the Code of Conduct. The Speak-Up policy was
established to ensure that all cases of suspected wrongdoing are
reported and managed in a timely and appropriate manner.
Signed by Louis A. Farrugia (Chairman) and Charles Borg
(Remuneration and Corporate Governance Committee Chairman) on
behalf of the Board on 30 May 2024.
28 COrPOraTE GOVErNaNCE STaTEmENT
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
REMUNERATION REPORT
1. TErmS OF rEFErENCE aND mEmBErShiP
The Remuneration and Corporate Governance Committee (RCGC)
is composed of three independent non-executive Directors. During
the financial year ended 31 January 2024 (FY 2024), the RCGC was
composed of Mr Charles Borg (Chairman), Marquis Marcus John
Scicluna Marshall and Prof. Avv. Alberto Stagno d’Alcontres (up to
23 May 2024). Mr Matthew Marshall replaced Marquis Marcus John
Scicluna Marshall on the 5th January 2024. The Committee met
once during the year with all members in attendance.
In terms of the Remuneration Policy of the Group, the RCGC
is responsible for reviewing and approving all remuneration
packages of Executive Directors, Non-Executive Directors and
Senior Management. The Remuneration Policy was approved by
Shareholders at the 20th Annual General Meeting held on 9 October
2020 with 33,496,250 votes in favour and 3,657 votes against and
can be found on the Group’s website www.tridentestatesplc.com. Any
material amendment to the Remuneration Policy shall be submitted
to a vote by the Annual General Meeting before adoption and shall
in any event be subject to confirmation at least every four years.
The RCGC is also responsible for drawing up and proposing to the
Company’s Board of Directors any amendments thought necessary
to the Remuneration Policy for consideration and approval.
The Remuneration Policy shall be presented for approval at the next
Annual General Meeting.
As provided in the Remuneration Policy, the recommendations
of the RCGC are submitted to the Board for consideration and
final approval. Individual Directors recuse themselves from
any participation in Board discussions concerning their own
remuneration as appropriate.
2. rEmUNEraTiON STraTEGY aND POLiCY
The strategy of the Trident Group is founded on developing and
managing quality property assets that create value to tenants and
provide a fair return to shareholders so as to ensure long-term
investment and profitable growth. It is believed that it is through
the implementation and observance of the above principles that the
Group will accomplish the vision of growing its business within the
local real estate sector.
The Trident Group has a small number of employees and a compact
management team. Notwithstanding the limited number of
personnel, in order to achieve the above strategic outcomes, it is
necessary that the Group attracts, retains and motivates the best
available talent at all levels – from the most recently recruited trainee
to members of the Board of Directors.
In order to be successful in this endeavour of attracting, retaining
and motivating best in class talent, it is essential that the Group’s
Remuneration Policy provides market-competitive salaries and
related benefits by reference to those provided by other entities
operating in the same market sector, and further enhanced by the
individual’s performance and unique capabilities.
The above principles apply equally to Remuneration Policy insofar
as Directors are concerned. However, there is a need to distinguish
between Executive and Non-Executive Directors, and further details
are provided below.
3. rEmUNEraTiON POLiCY –
ExECUTiVE DirECTOrS
Executive Directors are members of the Board who also have an
executive role in the day-to-day management of the Company
and the Group. For the purposes of this Remuneration Policy and
pursuant to Capital Markets Rule 12.2A, the Chief Executive Officer is
considered to be an Executive Director of the Company.
Insofar as Executive Directors are concerned, remuneration is made
up of the following components:
(a) Fixed Pay - Fixed or Base salary (including statutory bonus) -
established by reference to the role, skills and experience of the
individual concerned and appropriate market comparatives.
(b) Variable Pay – which is made up of two components as follows:
i. Performance bonus – a variable component established by
reference to the attainment or otherwise of pre-established
quantitative targets.
ii. Discretionary bonus – also a variable component, established
by reference to the evaluation of qualitative goals which are
reviewed from time to time.
Where applicable, the variable components to the remuneration
awarded to Executive Directors are established from year to year
and the quantitative and qualitative targets included therein would
change from time to time depending on the circumstances of the
business. Typically, targets directed towards the long-term interest
and sustainability of the Company and the Group would include,
but are not limited to, the achievement of set completion dates and
cost targets on development projects together with rental take up
rates on completion, agreed profit or EBITDA targets, environmental
and other ESG goals, and the implementation of specifically defined
business initiatives.
Whereas quantitative awards are usually formulaic in their
calculation, discretionary and qualitative awards necessarily involve
the application of subjective judgment. With effect from Financial
Year 2021, the Remuneration Report includes a disclosure of the
differing components and proportions of remuneration by individual
Director, as required by Appendix 12.1 of the Capital Markets Rules.
rEmUNEraTiON rEPOrT 29
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
Other provisions that form part of the Directors’ Remuneration Policy
include the following:
• Claw Backs – there are no claw back provisions in place in respect
of variable salary awards.
• Benefits – which would comprise those benefits normally
available to senior executives comprising principally (a) the
provision of a suitable (taxed and insured) company car, (b)
standard executive health insurance and life assurance cover,
(c) mobile phone and allowance (d) other incidental benefits.
Executive Directors also receive an expense allowance in
reimbursement of certain expenses incurred in the execution of
their respective roles and duties.
• Share Option schemes – to date it has not been the policy of the
Group to introduce any form of share option scheme or other
executive share awards.
The Board believes that the above components of Executive
Director remuneration serve to contribute to the realization of the
Group’s long- term strategy and interest – while also serving to
secure alignment between the interests of the Executive Directors
and that of the Shareholders.
The CEO is engaged without a fixed term contract. In terms of current
labour regulations, the CEO (and the senior management team) are
all regarded as employees on indefinite contracts.
4. rEmUNEraTiON POLiCY –
NON-ExECUTiVE DirECTOrS
Non-Executive Directors are those members of the Board who
do not have a role in the day-to-day executive management of
the Company and the Group. Remuneration for Non-Executive
Directors is determined by the Board of Directors as a whole and
takes into account the skills required and those levels prevailing in
the market for entities of a similar size and complexity.
The aggregate remuneration payable to Non-Executive Directors is
approved by Shareholders in the Annual General Meeting pursuant
to Article 81(1) of the Articles of Association of the Company and has
two components:
• A fixed or base Director’s fee which is established by reference to
those levels prevailing in the market for entities of a similar size
and complexity.
• Board Committee fee for membership of the various established
Board Committees (e.g. Audit Committee, Remuneration and
Corporate Governance Committee, etc). These Board Committee
fees vary between Committees depending upon the relative
workloads and time commitment involved, and the skill sets,
experience and professional knowledge required for the particular
Committee concerned.
• From time-to-time circumstances may arise whereby the Board
of Directors are faced in a particular year with significantly higher
and complex workloads than would be the norm. In recognition
of such circumstances, Board members may be awarded an
additional fixed fee on an exceptional basis. Such additional
awards would fall to be within the aggregate approved amount
by the general meeting in terms of Article 81(1) of the Articles of
Association of the Company.
Non-Executive Directors are not entitled to any contractual pension,
termination or retirement benefits. However, they may be reimbursed
certain expenses incurred in the discharge of their responsibilities.
Members of the Board of Directors appointed under the provisions
of Article 96 retire from office at least once every three years but
remain eligible for re-appointment. Those members of the Board
elected under the provisions of Article 97 shall retire from office at
the end of the next Annual General Meeting following their election,
and also remain eligible for re-election.
30 rEmUNEraTiON rEPOrT
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
5. rEmUNEraTiON – DirECTOrS aND ChiEF ExECUTiVE OFFiCEr
The following table provides a summary of the remuneration for the year ended 31 January 2024 for each individual Director and for the
Chief Executive Officer.
Directors’ Emoluments
Year ended 31 January
Board +
Committee
fees
2021
€
Aggregate
2021
€
Board +
Committee
fees
2022
€
Aggregate
2022
€
Board +
Committee
fees
2023
€
Aggregate
2023
€
Board +
Committee
fees
2024
€
Variable
pay
2024
€
Aggregate
2024
€
Louis Farrugia Chairman Executive 40,000 40,000 40,000 40,000 40,000 40,000 40,000 - 40,000
Vincent Curmi Vice Chairman
Non-Executive
27,000 27,000 27,000 27,000 27,000 27,000 22,500 - 22,500
Charles Borg Non-executive 21,000 21,000 21,000 21,000 21,000 21,000 21,000 - 21,000
Roderick Chalmers Non-executive 25,000 25,000 25,000 25,000 25,000 25,000 25,000 - 25,000
Michael Farrugia Non-executive 20,000 20,000 20,000 20,000 20,000 20,000 20,000 12,500 32,500
Alberto Miceli Farrugia Non-executive 22,000 22,000 22,000 22,000 22,000 22,000 22,000 - 22,000
Marquis Marcus J. Scicluna Marshall Non-executive 21,000 21,000 21,000 21,000 21,000 21,000 19,423 - 19,423
Alberto Stagno d’Alcontres Non-executive 21,000 21,000 21,000 21,000 21,000 21,000 21,000 - 21,000
Neil Psaila Non-executive - - - - - - 1,425 - 1,425
Matthew Marshall Non-executive - - - - - - 1,425 - 1,425
Board related emoluments included in the above table requiring Shareholder approval under Article 81 total €206,273 (approved limit: €300,000).
CEO’s Emoluments
Fixed pay
€
Variable pay
€
Benefits +
allowances
€
Aggregate
€
CEO remuneration for year ended 31 January 2024 153,673 60,000 1,980 215,653
CEO remuneration for year ended 31 January 2023 153,012 45,000 1,980 199,992
CEO remuneration for year ended 31 January 2022 152,239 38,334 1,980 192,553
CEO remuneration for year ended 31 January 2021 149,729 38,334 1,980 190,043
6. SharEhOLDEr iNVOLVEmENT
Pursuant to Article 81 of the Memorandum and Articles of
Association of the Company, remuneration (emoluments) payable
to Directors with regard to their membership of the Board of
Directors is always subject to the maximum aggregate limit
approved by the Shareholders in the Annual General Meeting. This
amount was fixed at an aggregate sum of €300,000 per annum at
the 18th Annual General Meeting held on 27 June 2018.
Whereas remuneration paid to Executive Directors by virtue of their
executive office (as opposed to membership of the Board) is not
subject to the maximum aggregate limit stipulated under Article 81
as described above, with effect from FY 2021 and pursuant to the
requirements of Capital Markets Rules, the Remuneration Report of
the Company shall form part of the Annual Report and shall provide
full details of remuneration paid to all Directors. In accordance
with Capital Markets Rule 12.26L and 12.26M, the Remuneration
Report will be subjected to an advisory vote by the Shareholders
at each Annual General Meeting and shall be made available on the
Company’s website for a period of 10 years following the meeting.
7. SENiOr maNaGEmENT rEmUNEraTiON
For the purposes of this Remuneration Report, “Senior
Management” shall mean the Chief Executive Officer, the Chief
Operating Officer and the Chief Financial Officer. The Chief
Executive Officer is responsible for carrying out regular reviews
of the compensation structure pertaining to senior management
in the light of the Group’s performance, economic situation and
market trends. One of the main objectives is to recruit and retain
executives of high professional standards and competence who can
enhance the Group’s performance and assure the best operational
and administrative practices.
The Chief Executive Officer reports and makes recommendations
periodically to the Board and the Remuneration and Corporate
Governance Committee on the remuneration packages, including
bonus arrangements, for achieving pre–determined targets.
The Remuneration and Corporate Governance Committee is
required to evaluate, recommend and report on any proposals
made by the Chief Executive Officer relating to senior management
remuneration and conditions of service. The Committee considers
that the current executive management remuneration packages
are based upon the appropriate local market equivalents and are
fair and reasonable for the responsibilities involved.
rEmUNEraTiON rEPOrT 31
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
The Committee also believes that the remuneration packages are
such as to enable the Company to attract, retain and motivate
executives having the appropriate skills and qualities to ensure the
proper management of the organisation.
The Committee is also charged with considering and determining any
recommendations from management on requests for early retirement.
The terms and conditions of employment of senior executives are set
out in their respective contracts of employment with the Company. As
a general rule such contracts do not contain provisions for termination
payments and/or other payments linked to early termination.
Senior management is eligible for an annual performance
bonus which is linked to agreed performance targets and their
achievement. The Remuneration Committee is of the view that
the relationship between fixed and variable remuneration and
performance bonus are reasonable and appropriate. There are no
claw-back provisions in respect of variable salary awards.
There are no executive profit sharing, share options or pension
benefit arrangements in place. Non–cash benefits to which Senior
Management are entitled comprise those normally available to
senior executives including the provision of a suitable taxed and
insured company car, executive health and life assurance cover, a
mobile phone package and other incidental corporate benefits.
During the year under review the total emoluments relating to the Group Senior Management members were as follows:
Senior management remuneration
Fixed pay
€
Variable pay
€
Benefits +
allowances
€
Aggregate
€
Senior management remuneration for year ended 31 January 2024 278,112 81,000 6,460 365,572
Senior management remuneration for year ended 31 January 2023 257,875 59,000 6,460 323,355
Senior management remuneration for year ended 31 January 2022 255,188 51,834 5,560 312,582
Senior management remuneration for year ended 31 January 2021 247,423 51,833 5,560 304,816
8. aPPENDix 12.1 OF ThE CaPiTaL marKETS rULES
The following table presents the annual change of remuneration, of the company’s performance, and of average remuneration on a full-time
equivalent basis of the company’s employees (other than directors) over the two most recent financial years as per the requirements within
Appendix 12.1 of the Capital Markets Rules.
2024 2023 2022 2021
Change
2023 to
2024
Change
2022 to
2023
Change
2021 to
2022
€’000 €’000 €’000 €’000 % % %
Remuneration
Directors remuneration and committee allowances 206 197 197 197 5 – –
CEO's remuneration 216 200 193 190 8 4 2
Total employee remuneration excluding directors & CEO 330 354 365 306 (7) (3) 19
Average employee remuneration 47 44 41 38 7 24 8
Company performance
Revenue 4,216 2,354 1,128 1,143 79 109 (1)
Profit after tax 1,052 6,574 63 550 (84) 10,435 (89)
Profit for the year excluding fair value movements 526 500 63 44 5 792 43
Value of investment property held under development – – 54,909 38,955 – (100) 41
Value of investment property held for commercial use 79,267 78,495 12,394 12,394 1 633 –
At this stage, the Group’s performance is primarily gauged on the progress made on the Trident Park development.
9. CONTENTS OF ThE rEmUNEraTiON rEPOrT
The contents of the Remuneration Report have been reviewed by the external Auditors to ensure that it conforms with the requirements of
Appendix 12.1 to Chapter 12 of the Capital Markets Rules.
32 rEmUNEraTiON rEPOrT
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
STATEMENTS OF FINANCIAL POSITION
As at 31 January
Group Company
2024 2023 2024 2023
Notes €’000 €’000 €’000 €’000
ASSETS
Non-current assets
Property, plant and equipment 4 81 89 55 72
Right-of-use assets 5 3,707 3,525 604 620
Investment property:
– held as commercial property 6 79,267 78,495 9,985 9,736
– held for future development 6 18,000 18,000 18,000 18,000
Investment in subsidiaries 7 – – 520 520
Advance payment 7 – – 951 951
Deferred tax asset 12 416 336 – –
Total non-current assets 101,471 100,445 30,115 29,899
–
Current assets
Trade and other receivables 8 1,449 1,166 34,086 33,256
Cash and cash equivalents 9 1,062 1,329 271 505
Total current assets 2,511 2,495 34,357 33,761
Total assets 103,982 102,940 64,472 63,660
STaTEmENTS OF FiNaNCiaL POSiTiON 33
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
As at 31 January
Group Company
2024 2023 2024 2023
Notes €’000 €’000 €’000 €’000
EQUITY AND LIABILITIES
Capital and reserves
Share capital
Share premium
Fair value gains reserve 11 10,042 9,516 7,762 7,546
Retained earnings 5,900 5,374 5,308 5,051
Total equity 60,775 59,723 57,903 57,430
Non-current liabilities
Borrowings 15 26,244 23,701 – –
Lease liabilities 5 3,955 3,716 687 687
Deferred tax liabilities 12 3,098 3,040 2,798 2,773
Trade and other payables 13 1,143 692 – –
Provision for liabilities and charges 14 1,119 1,299 – –
Total non-current liabilities 35,559 32,448 3,485 3,460
Current liabilities
Borrowings 15 1,369 1,536 – –
Trade and other payables 13 6,106 9,088 2,992 2,690
Lease liabilities 5 23 18 – –
Current tax liabilities 150 127 92 80
Total current liabilities 7,648 10,769 3,084 2,770
Total liabilities 43,207 43,217 6,569 6,230
Total equity and liabilities 103,982 102,940 64,472 63,660
The Notes on pages 38 to 62 are an integral part of these consolidated financial statements.
34 STaTEmENTS OF FiNaNCiaL POSiTiON
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
STATEMENTS OF COMPREHENSIVE INCOME
Year ended 31 January
Group Company
2024 2023 2024 2023
Notes €’000 €’000 €’000 €’000
Revenue 16 4,216 2,354 837 830
Direct costs 17 (758 ) (262 ) – –
Operating and administrative expenses 17 (1,308 ) (879 ) (345) (299)
Other operating income 56 54 – –
Operating profit 2,206 1,267 492 531
Fair value gains on investment property 6 585 6,749 240 6,749
Finance costs 20 (1,496 ) (530 ) (34) (34)
Profit before tax 1,295 7,486 698 7,246
Tax expense 21 (243 ) (912 ) (224) (888)
Profit for the year 1,052 6,574 474 6,358
Basic and diluted earnings per share for the
year attributable to shareholders 23 0.026 0.157
The Notes on pages 38 to 62 are an integral part of these consolidated financial statements.
STaTEmENTS OF COmPrEhENSiVE iNCOmE 35
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
STATEMENTS OF CHANGES IN EQUITY
GrOUP
Share
capital
Share
premium
Fair value
gains
reserve
Retained
earnings
Total
equity
Note €’000 €’000 €’000 €’000 €’000
Balance at 1 February 2022 42,000 2,833 3,442 4,874 53,149
Comprehensive income
Profit for the year – – – 6,574 6,574
T ransfer of fair value movements on
investment property, net of deferred tax 11 – – 6,074 (6,074 ) –
Balance at 31 January 2023 42,000 2,833 9,516 5,374 59,723
Balance at 1 February 2023 42,000 2,833 9,516 5,374 59,723
Comprehensive income
Profit for the year – – – 1,052 1,052
Transfer of fair value movements on
investment property, net of deferred tax 11 – – 526 (526 ) –
Balance at 31 January 2024 42,000 2,833 10,042 5,900 60,775
COmPaNY
Share
capital
Share
premium
Fair value
gains
reserve
Retained
earnings
Total
equity
Note €’000 €’000 €’000 €’000 €’000
Balance at 1 February 2022 42,000 2,833 1,472 4,767 51,072
Comprehensive income
Profit for the year – – – 6,358 6,358
T ransfer of fair value movements on
investment property, net of deferred tax 11 – – 6,074 (6,074) –
Balance at 31 January 2023 42,000 2,833 7,546 5,051 57,430
Balance at 1 February 2023 42,000 2,833 7,546 5,051 57,430
Comprehensive income
Profit for the year – – – 474 474
T ransfer of fair value movements on
investment property, net of deferred tax 11 – – 216 (216) –
Balance at 31 January 2024 42,000 2,833 7,762 5,308 57,903
The Notes on pages 38 to 62 are an integral part of these consolidated financial statements.
36 STaTEmENTS OF ChaNGES iN EqUiTY
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
STATEMENTS OF CASH FLOWS
Year ended 31 January
Group Company
2024 2023 2024 2023
Notes €’000 €’000 €’000 €’000
Cash flows from operating activities
Cash (used in)/ generated from operations 22 (682 ) 1,824 (3) 160
Interest paid (1,306 ) (349 ) – –
Net income tax paid (242 ) (226 ) (187) (181)
Net cash generated from/(used in) operations (2,230 ) 1,249 (190) (21)
Cash flow from investing activities
Purchase of property, plant and equipment 4 (14 ) (56 ) (1) (37)
Transfer of investment property to related parties 6 557 – – –
Purchase of investment property 6 (744 ) (8,918 ) (9) –
Net cash used in investing activities (201 ) (8,974 ) (10) (37)
Cash flow from financing activities
Proceeds from bank borrowings 3,259 8,466 – –
Payment of bank borrowings (883 ) – – –
Principal elements of lease payments (212 ) (197 ) (34) (34)
Net cash generated from/(used in) financing activities 2,164 8,269 (34) (34)
Net movement in cash and cash equivalents (267 ) 544 (234) (92)
Cash and cash equivalents at beginning of year 1,329 785 505 597
Cash and cash equivalents at end of year 9 1,062 1,329 271 505
The Notes on pages 38 to 62 are an integral part of these consolidated financial statements.
STaTEmENTS OF CaSh FLOwS 37
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
38 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 39
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
40 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 41
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
42 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 43
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
44 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 45
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
46 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 47
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
48 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 49
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
50 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 51
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
52 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 53
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
54 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 55
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
56 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 57
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
58 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 59
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
60 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS 61
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
62 NOTES TO ThE CONSOLiDaTED FiNaNCiaL STaTEmENTS
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
TriDENT ESTaTES PLC
SHAREHOLDER INFORMATION
Directors’ interests in the share capital of the company
Ordinary shares held
as at 31 January 2024
Ordinary shares held
as at 30 April 2024
Mr Louis A. Farrugia 42,313 42,313
Mr Michael Farrugia 7,773 7,773
Prof. Avv. Alberto Stagno d’Alcontres 801 801
Mr Matthew Marshall* 381,123 381,123
* Account held jointly
Directors’ interests listed above are inclusive of shares held in the name of the relative spouse and minor children as applicable.
Mr Louis A. Farrugia has beneficial interest in Farrugia Investments Limited directly and through Farrugia Holdings Limited. Mr Michael
Farrugia has beneficial interest in Farrugia Investments Limited through Farrugia Holdings Limited.
Prof. Avv. Alberto Stagno d’Alcontres has a beneficial interest in M.S.M. Investments Limited through Miceli Holdings Limited and Medsea
Investments Limited. Mr Alberto Miceli Farrugia has a beneficial interest in M.S.M. Investments Limited through Miceli Holdings Limited and
Bolina Holdings Limited.
Marquis Marcus John Scicluna Marshall has a direct beneficial interest in Sciclunas Estates Limited.
There has been no movement in the above stated shareholdings during the period from 31 January 2024 to 30 April 2024.
Shareholders holding 5% or more of the equity share capital as at 30 April 2024
Ordinary shares
Number of shares Percentage holding
M.S.M. Investments Limited 10,523,255 25.06%
Farrugia Investments Limited 10,471,062 24.93%
Sciclunas Estates Limited 10,453,489 24.89%
Shareholding details
As at 30 April 2024, the Company’s issued share capital was held by the following shareholders:
Number of shareholders
Ordinary shares at €1.00 each 1,687
The holders of the Ordinary shares have equal voting rights.
Number of shareholders as at 30 April 2024
Number of shareholders Number of shares Percentage holding
Ordinary shares of €1.00 each
Up to 500 shares 527 121,335 0.29%
501 – 1,000 292 216,030 0.52%
1,001 – 5,000 597 1,378,833 3.28%
More than 5,000 271 40,283,805 95.91%
Totals 1,687 42,000,003 100.00%
Nadine Magro
Company Secretary
Trident Park, Notabile Gardens, No.4 – Level 2, Mdina Road, Zone 2, Central Business District, Birkirkara CBD 2010, Malta
Telephone (+356) 2381 4297
SharEhOLDEr iNFOrmaTiON 63
CONSOLIDATED FINANCIAL STATEMENTS 2023/24
TRIDENT ESTATES PLC
Independent auditor’s report
To the Shareholders of Trident Estates plc
Report on the audit of the financial statements
Our opinion
In our opinion:
● The Group financial statements and the Parent Company financial statements (the “financial statements”) of Trident Estates plc give a true and fair view of the Group and the Parent Company’s financial position as at 31 January 2024, and of their financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards (‘IFRSs’) as adopted by the EU; and
● The financial statements have been prepared in accordance with the requirements of the Maltese Companies Act (Cap. 386).
Our opinion is consistent with our additional report to the Audit Committee.
What we have audited
Trident Estates plc’s financial statements comprise:
● the Consolidated and Parent Company statements of financial position as at 31 January 2024;
● the Consolidated and Parent Company statements of comprehensive income for the year then ended;
● the Consolidated and Parent Company statements of changes in equity for the year then ended;
● the Consolidated and Parent Company statements of cash flows for the year then ended; and
● the notes to the financial statements, comprising material accounting policy information and other explanatory information.
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 believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Group and the Parent Company in accordance with the International Code of Ethics for Professional Accountants (including International Independence Standards) issued by the International Ethics Standards Board for Accountants (IESBA Code) together with the ethical requirements of the Accountancy Profession (Code of Ethics for Warrant Holders) Directive issued in terms of the Accountancy Profession Act (Cap. 281) that are relevant to our audit of the financial statements in Malta. We have fulfilled our other ethical responsibilities in accordance with these Codes.
To the best of our knowledge and belief, we declare that non-audit services that we have provided to the parent company and its subsidiaries are in accordance with the applicable law and regulations in Malta and that we have not provided non-audit services that are prohibited under Article 18A of the Accountancy Profession Act (Cap. 281).
The non-audit services that we have provided to the parent company and its subsidiaries, in the period from 1 February 2023 to 31 January 2024, are disclosed in Note 17 to the financial statements.
Our audit approach
Overview
|
|
● Overall Group materiality: €1,042,000, which represents 1% of Total Assets |
|
● The Group is composed of 5 reporting units all located in Malta. ● The Group engagement team carried out the audit of the financial statements of the Parent Company as well as the audit of the financial statements of all the subsidiaries of the Company. |
|
|
● Valuation of Investment Property for Group and Company |
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the consolidated financial statements. In particular, we considered where the directors made subjective judgements; for example, in respect of significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain. As in all of our audits, we also addressed the risk of management override of internal controls, including among other matters consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.
Materiality
The scope of our audit was influenced by our application of materiality. An audit is designed to obtain reasonable assurance whether the financial statements are free from material misstatement. Misstatements may arise due to fraud or error. They are considered material if individually or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the consolidated financial statements.
Based on our professional judgement, we determined certain quantitative thresholds for materiality, including the overall group materiality for the consolidated financial statements as a whole as set out in the table below. These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent of our audit procedures and to evaluate the effect of misstatements, both individually and in aggregate on the financial statements as a whole.
|
Overall group materiality |
€1,042,000 |
|
How we determined it |
1% of total assets |
|
Rationale for the materiality benchmark applied |
We chose total assets as the benchmark because, in our view, it is the benchmark against which the underlying value of real estate companies is most commonly measured by users and is a generally accepted benchmark. We chose 1% which is within the range of asset-based materiality thresholds that we consider appropriate. |
We agreed with the Audit Committee that we would report to them misstatements identified during our audit above €104,200 as well as misstatements below that amount that, in our view, warranted reporting for qualitative reasons.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current period. 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.
|
Key audit matter |
How our audit addressed the Key audit matter |
|
Valuation of Investment property for Group and Company
The Group’s and Company’s investment property portfolio has a carrying amount of €97.3 million and €28 million respectively as at 31 January 2024. This year’s valuation assessment was performed by management, who also based its valuation conclusions on the third-party valuers’ reports issued.
The valuation of the Group’s and Company’s investment property portfolio is inherently subjective due to, among other factors, the individual nature of each property, its location and, where applicable, the expected future rentals for that particular investment property. For investment property developed, factors taken into account include projected costs to completion, timing thereof and expected rental income.
As disclosed in Note 6 to the financial statements, the valuations have been performed using the discounted cashflow approach or comparative sales approach, depending on the nature of the property.
The board of directors considered the valuation report as part of its overall responsibilities. The significance of the estimates and judgements involved, coupled with the fact that only a small percentage difference in individual property valuations, when aggregated, could result in a material misstatement, warrants specific audit focus in this area. |
We evaluated the methodology adopted in the valuations and the competence of the third-party valuers engaged, which included due consideration of their qualifications and expertise. We discussed with management, the valuation approaches adopted, the key valuation assumptions and other judgements made in arriving at their conclusions with respect to the property valuations.
We reviewed the valuation approaches adopted and underlying assumptions applied in the property valuations in order to assess the reasonableness of the fair value assigned to the properties. We engaged our own in-house experts to review the discounted cash flow valuations.
We reviewed the key parameters adopted by the Group/Company in these valuations including reconciling this data to underlying current lease agreements and compared the key parameters to those provided to the third-party valuers engaged.
For investment property where development is now substantially complete, we analysed costs incurred to date with related supporting documentation and assessed that the carrying value as at year end is supported by the projected cash flows to the completion of the said development.
We discussed the valuations with the directors and concluded, based on our work, that the Group’s and Company’s property valuations were within an acceptable range of values.
In addition, we evaluated the adequacy of the disclosures in Note 6 to the financial statements, including those regarding the key valuation assumptions applied in the property valuations. We discussed with management and obtained sufficient appropriate audit evidence to demonstrate that management’s assessment of the suitability of the inclusion of the valuation in the statement of financial position and disclosures made in the financial statements was appropriate. |
How we tailored our group audit scope
We tailored the scope of our audit in order to perform sufficient work to enable us to provide an opinion on the financial statements as a whole, taking into account the structure of the Group, the accounting processes and controls, and the industry in which the Group operates.
The Group audit team performed all of this work by applying the overall Group materiality, together with additional procedures performed on the consolidation. This gave us sufficient appropriate audit evidence for our opinion on the Group financial statements as a whole.
Other information
The directors are responsible for the other information. The other information comprises all of the other information in the Annual Financial Report (but does not include the financial statements and our auditor’s report thereon).
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon except as explicitly stated within the Report on other legal and regulatory requirements.
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, 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.
Responsibilities of the directors and those charged with governance for the financial statements
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 EU and the requirements of the Maltese Companies Act (Cap. 386), and for 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.
In preparing the financial statements, the directors are responsible for assessing the Group’s and the Parent Company’s ability 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 Group or the Parent Company or to cease operations, or have no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Group’s financial reporting process.
Auditor’s responsibilities for the audit of the financial statements
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 opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgement 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 Group’s and the Parent Company’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 Group’s or the Parent Company’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 Group or the Parent Company to cease 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.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with 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, actions taken to eliminate threats or safeguards applied.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the 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 with the requirements of the European Single Electronic Format Regulatory Technical Standard (the “ESEF RTS”), by reference to Capital Markets Rule 5.55.6
We have undertaken a reasonable assurance engagement in accordance with the requirements of Directive 6 issued by the Accountancy Board in terms of the Accountancy Profession Act (Cap. 281) - the Accountancy Profession (European Single Electronic Format) Assurance Directive (the “ESEF Directive 6”) on the Annual Financial Report of Trident Estates plc for the year ended 31 January 2024, entirely prepared in a single electronic reporting format.
Responsibilities of the directors
The directors are responsible for the preparation of the Annual Financial Report, including the consolidated financial statements and the relevant mark-up requirements therein, by reference to Capital Markets Rule 5.56A, in accordance with the requirements of the ESEF RTS.
Our responsibilities
Our responsibility is to obtain reasonable assurance about whether the Annual Financial Report, including the consolidated financial statements and the relevant electronic tagging therein, complies in all material respects with the ESEF RTS based on the evidence we have obtained. We conducted our reasonable assurance engagement in accordance with the requirements of ESEF Directive 6.
Our procedures included:
● Obtaining an understanding of the entity's financial reporting process, including the preparation of the Annual Financial Report, in accordance with the requirements of the ESEF RTS.
● 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 taggings therein have been applied and whether, in all material respects, they are 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 opinion.
Opinion
In our opinion, the Annual Financial Report for the year ended 31 January 2024 has been prepared, in all material respects, in accordance with the requirements of the ESEF RTS.
Other reporting requirements
The Annual Financial Report 2024 contains other areas required by legislation or regulation on which we are required to report. The Directors are responsible for these other areas.
The table below sets out these areas presented within the Annual Financial Report, our related responsibilities and reporting, in addition to our responsibilities and reporting reflected in the Other information section of our report. Except as outlined in the table, we have not provided an audit opinion or any form of assurance.
|
Area of the Annual Financial Report 2023/24 and the related Directors’ responsibilities |
Our responsibilities |
Our reporting |
|
Directors’ report The Maltese Companies Act (Cap. 386) requires the directors to prepare a Directors’ report, which includes the contents required by Article 177 of the Act and the Sixth Schedule to the Act. |
We are required to consider whether the information given in the Directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements.
We are also required to express an opinion as to whether the Directors’ report has been prepared in accordance with the applicable legal requirements.
In addition, we are required to state whether, in the light of the knowledge and understanding of the Company and its environment obtained in the course of our audit, we have identified any material misstatements in the Directors’ report, and if so to give an indication of the nature of any such misstatements. |
In our opinion: ● the information given in the Directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and ● the Directors’ report has been prepared in accordance with the Maltese Companies Act (Cap. 386).
We have nothing to report to you in respect of the other responsibilities, as explicitly stated within the Other information section. |
|
Corporate Governance Statement The Capital Markets Rules issued by the Malta Financial Services Authority require the directors to prepare and include in the Annual Financial Report a Statement of Compliance with the Code of Principles of Good Corporate Governance within Appendix 5.1 to Chapter 5 of the Capital Markets Rules. The Statement’s required minimum contents are determined by reference to Capital Markets Rule 5.97. The Statement provides explanations as to how the Company has complied with the provisions of the Code, presenting the extent to which the Company has adopted the Code and the effective measures that the Board has taken to ensure compliance throughout the accounting period with those Principles. |
We are required to report on the Statement of Compliance by expressing an opinion as to whether, in light of the knowledge and understanding of the Company and its environment obtained in the course of the audit, we have identified any material misstatements with respect to the information referred to in Capital Markets Rules 5.97.4 and 5.97.5, giving an indication of the nature of any such misstatements.
We are also required to assess whether the Statement of Compliance includes all the other information required to be presented as per Capital Markets Rule 5.97.
We are not required to, and we do not, consider whether the Board’s statements on internal control included in the Statement of Compliance 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 Statement of Compliance has been properly prepared in accordance with the requirements of the Capital Markets Rules issued by the Malta Financial Services Authority.
We have nothing to report to you in respect of the other responsibilities, as explicitly stated within the Other information section. |
|
Remuneration report The Capital Markets Rules issued by the Malta Financial Services Authority require the directors to prepare a Remuneration report, including the contents listed in Appendix 12.1 to Chapter 12 of the Capital Markets Rules. |
We are required to consider whether the information that should be provided within the Remuneration report, as required in terms of Appendix 12.1 to Chapter 12 of the Capital Markets Rules, has been included. |
In our opinion, the Remuneration report has been properly prepared in accordance with the requirements of the Capital Markets Rules issued by the Malta Financial Services Authority. |
|
|
Other matters on which we are required to report by exception We also have responsibilities under the Maltese Companies Act (Cap. 386) to report to you if, in our opinion: ● adequate accounting records have not been kept, or 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. ● we have not received all the information and explanations which, to the best of our knowledge and belief, we require for our audit. ● We also have responsibilities under the Capital Markets Rules to review the statement made by the directors that the business is a going concern together with supporting assumptions or qualifications as necessary. |
We have nothing to report to you in respect of these responsibilities. |
Other matter – use of this report
Our report, including the opinions, has been prepared for and only for the Parent Company’s shareholders as a body in accordance with Article 179 of the Maltese Companies Act (Cap. 386) and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior written consent.
Appointment
We were first appointed as auditors of the Company on 25 October 2020. Our appointment has been renewed annually by shareholder resolution representing a total period of uninterrupted engagement appointment of 23 years. The Company became listed on a regulated market on 30 January 2018.
David Valenzia
Principal
For and on behalf of
PricewaterhouseCoopers
78, Mill Street
Zone 5, Central Business District
Qormi
Malta
30 May 2024