MIDI p l c : Interim Financial Statements for 2023

MIDI p.l.c.

Condensed Consolidated Interim Financial Information

30 June 2023

MIDI p.l.c.

Condensed Consolidated Interim Financial Information - 30 June 2023

Contents

	Page
Interim Directors' Report pursuant to Capital Market Rule 5.75.2	1 - 3
Condensed consolidated statement of financial position	4
Condensed consolidated income statement	5
Condensed consolidated statement of comprehensive income	5
Condensed consolidated statement of changes in equity	6
Condensed consolidated statement of cash flows	7
Notes to the condensed consolidated interim financial information	8 - 15
Directors' statement pursuant to Capital Market Rule 5.75.3	15

MIDI p.l.c.

Condensed Consolidated Interim Financial Information - 30 June 2023

Interim Directors' Report pursuant to Capital Market Rule 5.75.2

This Interim Directors' Report is published in terms of the Malta Financial Services Authority Listing Rules Chapter 5 and the Prevention of Financial Markets Abuse Act, 2005. The consolidated interim financial information included in this report has been extracted from MIDI p.l.c.'s ("MIDI" or "Company") unaudited consolidated financial information for the six months ended 30 June 2023 prepared in accordance with IAS 34 'Interim Financial Reporting'. The Group includes Midi p.l.c. as the parent entity and its subsidiaries: Tigné Contracting Limited, T14 Investments Limited and Solutions & Infrastructure Services Limited, together "the Group". The Group has an investment in a joint venture entity, Mid Knight Holdings Limited. In terms of Listing Rule 5.75.5, this interim report has not been audited or reviewed by the Group's independent auditors.

Principal activity

The principal activity of the Group is the development of the Manoel Island and Tigné Point project.

Material events & transactions

In preparing this Report, the Directors have taken regard of the material events and transactions for the period ended 30 June 2023 ("the Relevant Period"), and their impact on the condensed set of financial statements, together with the prospects of the remaining six months ending 31 December 2023.

During the Relevant Period, the MIDI Group has posted a loss after tax of €1.1 million (June 2022: loss after tax of €0.5 million).

The Company's development and sale of property segment is the principal driver of the Group's financial results. As previously announced, MIDI had launched to the market the apartments from its final residential development at Tigné Point (known as Q3 - Fortress Gardens) in February of this year. This launch has been very successful and currently 75% of these apartments are subject to a promise of sale agreement. Notwithstanding this, in terms of the Company's accounting policies, the sale of these residential units will only be accounted for once the final deeds of sale are entered into with the respective buyers. Given that the Group's financial results are very dependent on the contribution generated from the sale of property, the lack of revenues recognised from this business segment invariably impacts the Group's overall financial performance. Since the Company had no other property for sale, revenues generated from the sale of property during the Relevant Period were limited to €38k (2022: €27k) resulting in an operating loss of €687k (2022: operating loss: €321k) on this segment.

With regards to the property and rental management segment, rental revenues were marginally less when compared to the same revenues for 2022 (2023: €1.41 million vs 2022: €1.50 million). Nonetheless, profitability for the Relevant Period was higher than that recorded for 2022 (2023: €169k vs 2022: €158k). This segment includes the Group's rental operations of its Pjazza retail outlets and foreshore restaurants, car parking operations, operator concession fees earned from the Manoel Island Yacht Marina and the operating activities undertaken by Solutions and Infrastructure Services Limited ("SIS").

With regards to SIS, the Company had announced in December 2022, that as part of a corporate restructuring exercise, this subsidiary will be amalgamated with the Company during 2023, by virtue of a merger by acquisition procedure to be carried out in accordance with the provision of Title II, Chapter III, Part VIII of the Companies Act, 1995. The amalgamation is expected to happen during Q4 of 2023 when the Company, as the acquiring company, shall succeed to all the assets, rights, liabilities and obligations of SIS, which in turn will cease to exist.

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MIDI p.l.c.

Condensed Consolidated Interim Financial Information - 30 June 2023

Interim Directors' Report pursuant to Capital Market Rule 5.75.2 - continued

The Group's results for the Relevant Period also include the Group's 50% share of the financial results of Mid Knight Holdings Limited ("MKH"), a joint venture company which owns and operates 'The Centre' office block located at Tigné Point. The Group's share of MKH's profit for the Relevant Period amounted to €723k (2022: €993k).

Total Group consolidated assets have increased from €231.9 million as at 31 December 2022 to €239.2 million whilst the Group's Net Asset Value decreased from €101.3 million to €100.2 million reflecting the loss being posted for the Relevant Period. Consequently, the Net Asset Value per share now stands at €0.468 (€0.473 as at 31 December 2022).

Works on the Q3 - Fortress Gardens residential development continue to progress in line with projected timelines and civil works are now practically complete. Both finishing and façade works contracts have been awarded and both contractors initiated onsite mobilisation. It is expected that these works will be completed during the second half of 2025 following which the finished apartments will be delivered to their prospective owners.

The development of Manoel Island continues to play a prominent part in the Group's activities. Discussions with Government are ongoing with regards to the specific remedies available in the Deed of Emphyteusis entered into on 15 June 2000 which will help to mitigate, in part, the impact of the reduction of development volumes as a consequence of the discovery of archaeological remains on the Manoel Island site. The discovery of such remains necessitated a revision to the Manoel Island masterplan which resulted in a reduction of development volumes from 127,000sqm to 95,000sqm.

As previously announced, the Planning Authority ("PA") has approved the Outline Permit for the revised Manoel Island Masterplan on 16 September 2021. This had followed the approval of the Environmental Impact Assessment ("EIA") by the Environmental and Resources Authority ("ERA"). Although the Outline Permit was not subject to appeal itself, the decision by ERA to approve the EIA had been appealed by third parties. On the 10 January 2023, the Environment and Planning Review Tribunal advised that the third party's appeal had been rejected. Following this, the Malta Court of Appeal also rejected the third party's appeal on 10 May 2023. As a result of these decisions, both the EIA and the Outline Development Permit are now confirmed.

Following the signing of a non-binding memorandum of understanding with AC Enterprises Limited (C49755) in December 2021 the Company has continued with intensive negotiations and discussions with the party in question with a view to explore the possibility of establishing a joint venture with regards to the Manoel Island development. No transaction has been concluded yet.

In parallel to the ongoing separate discussions with Government and AC Enterprises Limited, the detailed design process has continued in earnest and the full development application for the Manoel Island development was submitted to the PA in December 2022. In addition, site preparatory works have commenced on the Manoel Island site.

With respect to the second half of 2023, a similar financial performance is expected to the one being reported for the Relevant Period. The Company will have to rely on its property rental and management segment for revenue and contribution generation for the second half of 2023 given that it will be unable to record both the sale and resultant contribution of Q3-Fortress Gardens apartments until such time that these apartments are delivered to their prospective owners.

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MIDI p.l.c.

Condensed Consolidated Interim Financial Information - 30 June 2023

Interim Directors' Report pursuant to Capital Market Rule 5.75.2 - continued

It is also important to note that projected returns from its current projects, i.e., that of the Q3 residential project and the Manoel Island development, are not expected to accrue in the medium term. In view of this, the Group continues to adopt a prudent approach in its projected cashflow assessments. Based on these assessments, the directors believe that the Group will have sufficient liquidity and financial resources to meet all its obligations and expected outflows after considering the arrangements which are in place with its bankers in respect of sanctioned bank facilities.

Related party transactions

MIDI p.l.c. and its subsidiaries enter into related party transactions in the ordinary course of their activities. Related party transactions are reviewed and approved by the Audit Committee on a regular basis. All related party transactions pertaining to the six-month period ended 30 June 2023 have been disclosed in Note 7 to the Condensed Consolidated Interim Financial Information.

On behalf of the Board

Alec A. Mizzi	Joseph A. Gasan
Chairman	Director
30 August 2023
Company Secretary:	Catherine Formosa
Registered Office:	North Shore, Manoel Island, Gżira, Malta
Telephone Number:	([phone]
Company Registration No:	C 15836

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