Juel Group Plc - 485100T71HGPIVIIF136

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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DIRECTORS' REPORT

FOR THE YEAR ENDED 31st DECEMBER 2023

The Directors present their report together with the audited parent Company financial statements and the Group’s consolidated financial statements of JUEL Group plc for the year ended 31st December 2023.

Principal Activities

The main activity of Juel Group plc is to hold investments in subsidiary and associate companies and to raise financial capital from the capital markets so as to finance the subsidiary companies.

The Group has three distinct business segments, these being property development, property rentals and hotel operations. The latter segment is still under development with plans to start operations in Q4 of 2024. Also, the property development Company does not have any property sales in financial year 2023. Final deeds of sale are scheduled to start at the beginning of Q3 of 2024. The directors do not envisage any changes to the principal activities of the Company and Group in the foreseeable future.

Since the revenue is mainly from the letting of property, it was not considered necessary to carry out segmental reporting.

Review of the Business

On 22nd December 2022 Juel Group plc acquired the entire share capital of the four subsidiary companies which are involved in property development, property letting and hospitality. These four subsidiaries are:

Juel Holdings Limited (property letting)

Juel Hospitality Limited (hospitality)

Muscat Holdings (II) Limited (property development)

Muscat Holdings Limited (property holding)

Furthermore, Juel Group plc acquired 33.33% of the Ordinary A shares in GAP Group Investments (II) Ltd on the 14th April 2023.

ACMUS Group Ltd was incorporated on 16 February 2023 as an associate company of Muscat Holdings (II) Ltd with a shareholding of 49.99%.

Hotel in St. Julians

Juel Hospitality Limited is currently proceeding with works on the development of the hotel in St. Julians. Construction and finishes are expected to be completed in Q4 of 2024.

Muscat Holdings (II) Limited has two property developments in Marsascala and the status of these projects is as follows:

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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DIRECTORS' REPORT – continued

Portoscala in Triq Il Bahhara

Portoscala comprises a total of 28 residential units spread over four floors in three blocks. The development also has 35 garages located at basement levels.

This development was fully completed in March 2024. As at 31st December 2023, 2 apartments and 1 garage were subject to a preliminary agreement. Others are being sold throughout the year. Final contracts of sale are expected to commence in the latter part of June 2024.

Solea in Triq Il-Hut

The project consists of a total of 25 residential units and 18 lock-up garages.

The construction works commenced in February 2023 and are expected to be completed in Q2 of 2024.

Finishing works are underway and are planned to be completed in Q3 of 2024.

The project is planned to be placed on the market once finishing works are nearing completion.

Other developments

Muscat Holdings (II) Limited does not have plans to have direct involvement in property development, once current projects are completed. However, in February 2023 a new company was formed by the name of ACMUS Group Limited in which Muscat Holdings (II) Limited has 49.99% shareholding. This joint venture entity is with The Ona Group plc.

ACMUS Group Limited’s objective is that of property development and as at 31st December 2023 it was developing two sites – one in Mgarr and another in St. Julians. Both projects are at the initial stages of development. The company has entered into Promise of Sale agreements to acquire other properties, some of which will have the final deeds signed in 2024.

Bonds in Issue

As at 31st December 2023, the Group had a public listed Bond in issue, namely the Juel Group plc 5.5% Secured Bonds 2035. The Bond was issued pursuant to a Prospectus dated 6th June 2023 and was added to listing on the Official List of the Malta Stock Exchange on the 4th July 2023.

The Issuer and the Guarantors (namely the subsidiary companies) have entered into a Trust Deed with Equinox International Limited, the Security Trustee, for the benefit and safeguarding of the bondholders.

Principal Risks and Uncertainty

The Company is dependent on the performance of its subsidiaries.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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DIRECTORS' REPORT – continued

Principal Risks and Uncertainty - continued

The Company is the finance and holding Company of the Group and does not carry out any trading activities of its own. The Company is therefore economically dependent on the performance and financial position of its subsidiaries and associate undertakings. In the event that any subsidiary and/or associate underperforms in any one financial year or otherwise experiences adverse fluctuations or volatility in cash

flows, liquidity strains or other financial difficulties, such underperformance or adverse financial position would adversely affect the operational and financial results of the Group as a whole and consequently, that of the Company.

As a holding Company, the majority of the Company’s income consists of the dividends and interest on loan receivables it receives from its subsidiaries. The payment of receivables and distribution of dividends is dependent on the cash flows and earnings of the relevant subsidiary.

The Company has entered into a loan agreement with Juel Hospitality Limited pursuant to which it advanced amounts to finance its hotel project. The ability of Juel Hospitality Limited to make payments of principal and interest to the Company in repayment of the loan granted to it is dependent on the financial position of Juel Hospitality Limited.

The business activities carried out by the Group companies are subject to a number of market, economic and financial risks. A detailed review of these risks is included in Note 2 to the financial statements.

Events subsequent to the reporting period

On the 8th April 2024, the Company received regulatory approval for the issue of a Note Issuance Programme of up to € 5,000,000 Unsecured Notes 2027 - 2029. The first Tranche amounting to €3,500,000 at interest rate of 6.5% per annum was issued and fully subscribed to by the 19th April 2024.

Results and Dividends

The 12 month period up to 31 December 2023 represents the Group’s first full 12 month period of consolidated financial results of the Company and its Subsidiaries. The Group’s results for 2022 covered the period from 22 December 2022, the date when Juel Group plc acquired its subsidiaries, up to 31 December 2022.

In the period ending 31 December 2023 the Group generated turnover amounting to €749,557, with €696,257 being generated from the property rentals operated under the StayMela brand and €20,000 from property sales. No revenue was generated from the hotel which is currently under construction. The two Marsascala property development projects, one in the final stage of completion, registered preliminary agreements for 2 apartments and 1 garage, but no revenue was recognised as at end of 2023. Expenses incurred in connection with these projects have been capitalised. After deducting direct costs amounting to €411,589 and administrative expenses of €249,050, the Group registered an operating profit amounting to €1,188,918 which includes €1,100,000 to fair value of the investment property included under other income.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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DIRECTORS' REPORT – continued

Results and Dividends - continued

A fair value adjustment on the investment property held by the subsidiaries resulted in other income amounting to €1,100,000, while the share of results of associated investments amounted to €3,230,281. As a result, the Group ended the year with a net profit before tax of €4,479,984 (2022 - loss of €1,021) and a net profit after tax of €4,342,547 (2022 - profit of €1,226).

The Directors do not recommend the payment of a dividend.

Directors and Company Secretary

The Directors of the Company who held office during the year were:

Adrian Muscat - Executive Director

George Muscat – Non-Executive Director – ceased on 22nd September 2023.

Mario Camilleri – Independent Non-Executive Director

Robert C. Aquilina - Independent Non-Executive Director

Dennis Gravina - Independent Non-Executive Director

Dr Karen Coppini - Company Secretary.

In accordance with the Company’s Memorandum and Articles of Association the Directors and Company Secretary remain in office.

Statement of Directors’ Responsibilities

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

•Ensure that the financial statements have been drawn up in accordance with IFRSs as adopted by the EU;

•Adopt the going concern basis unless it is inappropriate to presume that the Company will continue in business;

•Make judgements and estimates that are reasonable and prudent;

•Account for income and charges relating to the accounting period on the accruals basis;

•Report comparative figures corresponding to those of the preceding accounting period.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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DIRECTORS' REPORT – continued

Statement of Directors’ Responsibilities - continued

The Directors are also responsible for ensuring that proper accounting records are kept which disclose with reasonable accuracy at any time the financial position of the parent Company and of the Group and which enable the Directors to ensure that the financial statements comply with the Companies Act (Chapter 386). This responsibility includes designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. The Directors are also responsible for safeguarding the assets of the Company, and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The Annual report and consolidated financial statements of Juel Group plc for the year ended 31st December 2023 are made available on the Company’s website (juel.mt). The Directors are responsible for the maintenance and integrity of the financial statements on the website. In view of their responsibility for the controls over and the security of the website, access to information published 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.

Statement by the Directors pursuant to Listing Rule 5.68

The Directors declare that to the best of their knowledge the financial statements were prepared in accordance with the applicable accounting standards give a true and fair view of the assets, liabilities, financial position and profit or loss of the parent Company and its subsidiaries included in the consolidation taken as a whole, and that this report includes a fair review of the performance of the business and the position of the Company and its subsidiaries included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

Going Concern statement pursuant to Listing Rule 5.62

The Directors, at the time of approval of the financial statements, consider the going concern assumption in the preparation of the financial statements as appropriate as at the date of authorisation and believe that no material uncertainty that may cast significant doubt about the Company’s and the Group’s ability to continue as a going concern exists as at that date.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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DIRECTORS' REPORT – continued

Company Auditor

TACS Malta Limited have expressed their willingness to continue in office and a resolution proposing their reappointment will be put forward to the members at the next annual general meeting.

Signed on behalf of the Board of Directors on 29th April 2024 by Mr. Adrian Muscat and Mr. Mario Camilleri as per the Directors’ Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Financial Report.

Adrian Muscat Mario Camilleri

Director Director

Registered Office:

Avian Hill

Triq L-Ispanjulett c/w Triq Il-Gallina

Kappara, San Gwann SGN 4042

Malta

Dated: 29 April 2024

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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CORPORATE GOVERNANCE - STATEMENT OF COMPLIANCE

Applicable Corporate Governance Code

The Company has designed and implemented a Corporate Governance Code (the ‘Code’) based on the Principles of Good Corporate Governance established by CMR 5.92 to CMR 5.97 of Chapter 5 of the Maltese Capital Market Rules (CMR) issued by the Malta Financial Services Authority (MFSA) and the Code of Principles of Good Corporate Governance contained in Appendix 5.1 to the said Chapter (the ‘Appendix’). Endorsed by the Board on the 27 April 2023, the Code is intended to provide proper incentives to the Company’s Board and Management to pursue good governance in its day-to-day operations, in the interest of the Company, its Shareholders and Stakeholders.

In accordance with CMRs 5.55.3, 5.94 and 5.97 the Directors hereby report on the compliance by the Company with the provisions of the Appendix. The Board recognises that, in virtue of CMR 5.101, the Company is exempt from the requirement to disclose the information prescribed by CMR 5.97.1 to 5.97.3, 5.97.6 and 5.97.8.

In terms of CMR 5.97.1 the original signed Code is available for inspection by the public at the registered office of the Company.

Composition of Board

The Board of Directors is required to exercise effective control, to assess and manage the Company’s risks, determine the Company’s strategic aims and improve the economic and commercial prosperity of the Company. It is required to establish a clear internal and external reporting system to have continuous access to accurate, relevant and timely information to discharge its duties and take decisions.

In accordance with Article 2 of the Code, the first Chairman of the Company was George Muscat. Following his demise on the 22 September 2023, on the 16 October 2023 the Board resolved to appoint the Company’s independent non-executive director Mr. Robert C. Aquilina as interim Chairman of the Company until the next annual general meeting.

The Company’s Memorandum of Association provides that the Board of Directors of the Company shall consist of a minimum of three (3) directors and a maximum of five (5) directors. The present directors of the Company are:

Mr. Adrian Muscat – Executive Director

Mr. Robert C. Aquilina – Interim Chairman, Independent Non-Executive Director

Mr. Mario Camilleri – Independent Non-Executive Director

Mr. Dennis Gravina – Independent Non-Executive Director

Mr. Adrian Muscat, the Executive Director of the Company and its subsidiaries, is entrusted as de facto Chief Executive Officer with the day-to-day management of the Group.

In terms of the Company’s Articles of Association an election of directors shall take place every year and all directors, except the managing director, shall retire from office once at least in each three (3) years, but shall be eligible for re-election. In terms of the Article 103.1 of the Articles of Association of the Company any member or number of members who in aggregate holds not less than twenty percent (20%) of the shares having voting rights in the Company shall be entitled to nominate fit and proper persons for the appointment as Directors of the Company.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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CORPORATE GOVERNANCE - STATEMENT OF COMPLIANCE – continued

Composition of Board - continued

The Board has determined that except for Mr Adrian Muscat, all the Directors of the Company are independent in terms of CRM 5.119, that is within the last three years none of the non-executive directors had any business, family or other relationship with the Company, its controlling shareholder or management that creates a conflict of interest impairing their judgement on the Board as defined in the said CRM 5.119.

Committees – Audit Committee

The Composition of the Audit Committee

In line with CMR 5.117, the Company has established an Audit Committee which is required to protect the interests of the Company’s shareholders and assist the Board of Directors to conduct their role effectively. It is there to ensure that financial results are reported accurately and maintain a high level at all times. The Audit Committee is responsible for overseeing the system of internal controls and risk management system of the Company.

The Audit Committee is presently composed of:

Mr. Mario Camilleri – Chairman, Independent Non-Executive Director

Mr. Robert C. Aquilina – Independent Non-Executive Director

Mr. Dennis Gravina – Independent Non-Executive Director

Mr. Mario Camilleri, the Chairman of the Audit Committee, is considered by the Company to be competent in accounting and/or auditing. The Company considers that as a whole the Audit Committee have the required competence relevant to the sector which the Company is operating in.

In line with its Terms of Reference dated 22 May 2023, the Audit Committee shall establish internal procedures and monitor the effectiveness of the Company’s internal quality control and risk management systems, monitor the financial reporting process including the statutory audit, the performance, findings and conclusions together with any reports prepared by the statutory auditors which are submitted to the Audit Committee. It shall also be required to review and monitor the independence of the statutory auditors of the Company and recommend their re-appointment or otherwise in accordance with the Statutory Audit Regulation. The Audit Committee, as a sub-committee of the Board, shall consider the arm’s length nature of transactions and give due consideration as to whether transactions are considered to be Material Related Party Transactions or whether these are being taken in the ordinary course of the Group’s business. It is empowered to approve or otherwise such Material Related Party Transaction.

In line with its Terms of Reference, the Audit Committee is required to assess any potential conflicts of interest between the duties of directors and their respective private interests and duties unrelated to the Company.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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CORPORATE GOVERNANCE - STATEMENT OF COMPLIANCE – continued

Committees – Evaluation Committee

In accordance with Article 7 of the Code, the Company has not appointed an Evaluation Committee. The Board of Directors have continuous oversight and communication with its shareholder, being the Executive Director of the Company, and therefore the Board does not consider it necessary to appoint an Evaluation Committee.

Committees – Remuneration and Nomination Committee

In accordance with Principle 8 of the Appendix, due to its limited operational function the Company has not appointed a Remuneration and/or Nomination Committee.

In the event that the Company determines that any such above-mentioned committee shall be appointed, then the Board shall be authorised to appoint such committees which shall be required to adopt the provisions of the Appendix for such purpose.

Board and Committee meetings

The Board of Directors met formally on ten (10) occasions whilst the Audit Committee of the Company met formally on five (5) occasions during the reporting period. In terms of Article 9 of the Code, the Chairman of the Audit Committee is answerable to the Annual General Meeting. The Audit Committee reports directly to the Board. In particular, the Chairperson of the Audit Committee is required to report any significant findings and recommendations which the Audit Committee has to the Board after each audit committee meeting. The Chief Finance Officer is invited to the Board and Audit Committee meetings to report on the financial operation and results of the Group.

Dr. Karen Coppini has been appointed by the Board to the office of Company Secretary and also acts as secretary to the Audit Committee. She is responsible for ensuring that the Board and Audit Committee procedures are complied with. All the Directors have access to the advice and services of the Company Secretary.

Remuneration Statement

In accordance with Article 121 of the Articles of Association of the Company, the maximum aggregate emoluments of all directors in any financial year and any increases thereto shall be such amount as may from time to time be determined by the Company in the General Meeting and any notice convening the general meeting during which an increase in the maximum amount of such aggregate emoluments shall be proposed, shall contain a reference to that fact. During the period under review, the non-executive directors of the Company received €28,500 in aggregate for the services rendered during 2023. No part of the remuneration paid to the directors is performance based. None of the non-executive directors, in their capacity as a Director of the Company, is entitled to profit-sharing, share options or pension benefits.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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CORPORATE GOVERNANCE - STATEMENT OF COMPLIANCE – continued

Relations with Shareholders and the Market

In line with Principle 9 of the Appendix, the Company issues Company announcements to enable investors to make informed investment decisions in terms of the Capital Markets Rules.

Main Features of internal controls and risk management systems in relation to the financial reporting process

The Audit Committee is responsible for overseeing the system of internal controls and risk management system of the Company. It also acts as a support to the Board in its responsibilities in dealing with issues of risk, control, governance and associated assurance of the Company.

Sustainability Statement

An assessment of the Non-Financial Reporting Directive (‘NFRD’), Corporate Sustainability Reporting Directive (‘CSRD’) and Article 8 Taxonomy Regulation was carried out by the Company in October 2023 and based on the size categories defined by Article 3 of the Accounting Directive the Group falls within the category of ‘small’ undertaking. Consequently following the entry into force of the CSRD, in the absence of any further changes to implementation details of the directive, the Company will be subject to reporting obligations under the CSRD and Article 8 of the Taxonomy Regulation starting from the financial year commencing 01 January 2026 for which the first financial statements will be published in 2027. The Group is seeking to conduct an assessment within its subsidiaries to identify the material implications of sustainability reporting requirements within its business segments namely: Property Development, Property Letting and Hospitality. The Group has already taken active steps to implement various sustainability measures across its business such as energy efficiency practices in terms of lighting and insulation for its building projects, rainwater harvesting systems and waste segregation during construction to ensure timely and effective compliance with CSRD and the Taxonomy Regulation.

Extent to which the Company departs from the CMR 5.97.1 and Appendix.

The Company is ultimately privately held and has no institutional shareholders, therefore Principle 10 of the Appendix does not, at present, apply to the Company.

Other than as stated in this Report, the Company has fully implemented the principles set out in the Code, CMRs and Appendix.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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CORPORATE GOVERNANCE - STATEMENT OF COMPLIANCE – continued

Signed on behalf of the Board of Directors on 29th April 2024 by Mr Adrian Muscat and Mr Mario Camilleri as per the Directors’ Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Financial Report.

Adrian Muscat Mario Camilleri

Director Director

Registered Office:

Avian Hill

Triq L-Ispanjulett c/w Triq Il-Gallina

Kappara, San Gwann SGN 4042

Malta

Dated: 29 April 2024

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

FOR THE YEAR ENDED 31ST DECEMBER 2023

Group

Company

Notes

2023

2022

2023

2022

€

Revenue

749,557

5,404

33,300

Cost of sales

(411,589)

(2,039)

Gross Profit

337,968

3,365

33,300

Administrative expenses

Other income

(249,050)

1,100,000

(6,463)

(99,677)

(4,775)

Operating profit /(loss)

1,188,918

(3,098)

(66,377)

(4,775)

Finance income

60,785

2,177

1,428,299

321,527

Finance costs

(100)

(1,350,471)

(315,754)

Net finance costs

60,785

2,077

77,828

5,773

Share of profit of equity-accounted investees, net of tax

3,230,281

3,263,400

Profit/(loss) before taxation

4,479,984

(1,021)

3,274,851

998

Income tax expense

(137,437)

2,247

1,857

(349)

Profit for the year/period

4,342,547

1,226

3,276,708

649

6,802,968

Total Comprehensive income for the year/period

4,342,547

1,226

3,276,708

649

Earnings per share

0.26

0.20

The notes on pages 16 to 53 are an integral part of these financial statements.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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STATEMENT OF FINANCIAL POSITION – 31ST DECEMBER 2023

		Group		Company
	Notes	2023	2022	2023	2022
		€	€	€	€
ASSETS
Non-Current Assets
Property, plant and equipment	11	27,158,252	21,128,541	-	-
Investment property	12	11,800,000	10,700,000	-	-
Investment in subsidiaries	14	-	-	10,948,390	10,948,390
Investments in associates	15	12,801,515	-	11,178,238	-
Other investments	16	-	-	24,408,601	17,591,867
		51,759,767	31,828,541	46,535,229	28,540,257
Current assets
Deferred tax		8,565	2,347	6,256	-
Inventory	17	8,858,284	6,188,165	-	-
Trade and other receivables	18	3,090,435	916,610	3,752,422	-
Cash and cash equivalents	19	9,288,465	1,163,772	8,551,345	1,900
		21,245,749	8,270,894	12,310,023	1,900
Total Assets		73,005,516	40,099,435	58,845,252	28,542,157
EQUITY AND LIABILITIES
Capital Reserves
Share capital	20	19,066,227	10,951,390	19,066,227	10,951,390
Share Premium Account		1,892,355	-	1,892,355	-
Retained earnings		4,343,773	1,226	3,277,357	649
Other equity	21	(17,970)	(17,970)	-	-
Total equity		25,284,385	10,934,646	24,235,939	10,952,039
Non-current liabilities
Other loans and borrowings	23	6,887,875	6,063,777	-	-
Debt securities in issue	23	32,000,000	-	32,000,000	-
Deferred tax liability	13	944,000	856,000	-	-
Total non-current liabilities		39,831,875	6,919,777	32,000,000	-
Current liabilities
Other loans and borrowings	23	2,827,886	8,000,000	-	8,000,000
Trade and other payables	25	5,024,565	4,737,029	2,604,914	101,926
Current tax liabilities		36,805	20,140	4,399	349
Bond advance facility	24	-	9,487,843	-	9,487,843
Total Current liabilities		7,889,256	22,245,012	2,609,313	17,590,118
Total liabilities		47,721,131	29,164,789	34,609,313	17,590,118
Total equity and liabilities		73,005,516	40,099,435	58,845,252	28,542,157

The notes on pages 16 to 53 are integral part of these financial statements.

The financial statements were approved and authorised for issue by the Board of Directors on 29 April 2024. The financial statements were signed on behalf of the Board of Directors by Mr. Adrian Muscat and Mr. Mario Camilleri as per the Directors’ Declaration on ESEF Annual Financial Report submitted in conjunction with the Annual Financial Report.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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STATEMENT OF CHANGES IN EQUITY

FOR THE YEAR ENDED 31ST DECEMBER 2023

	Notes	ShareCapital	Other Equity	SharePremium	Retained Earnings	Total
		€	€	€	€	€
Group
Issue of share capital		10,951,390	-	-	-	10,951,390
Comprehensive income for the period
Profit for the period		-	-	-	1,226	1,226
Loss arising on acquisition of the subsidiaries		-	(17,970)	-	-	(17,970)
Balance at 31st December 2022		10,951,390	(17,970)	-	1,226	10,934,646

Balance at 1st January 2023		10,951,390	(17,970)	-	1,226	10,934,646
Comprehensive income for the year
Profit for the year		-	-	-	4,342,547	4,342,547
Transactions with owners
Increase in share premium		-	-	1,892,355	-	1,892,355
Issue of share capital	20	8,114,837	-	-	-	8,114,837
Balance at 31st December 2023		19,066,227	(17,970)	1,892,355	4,343,773	25,284,385

Company
Issue of share capital		10,951,390	-	-	-	10,951,390
Comprehensive income for the period
Profit for the period		-	-	-	649	649
Balance at 31st December 2022		10,951,390	-	-	649	10,952,039
Balance at 1st January 2023		10,951,390	-	-	649	10,952,039
Comprehensive income for the year
Profit for the year		-	-	-	3,276,708	3,276,708
Transactions with owners
Increase in share premium		-	-	1,892,355	-	1,892,355
Issue of share capital	20	8,114,837	-	-	-	8,114,837
Balance at 31st December 2023		19,066,227	-	1,892,355	3,277,357	24,235,939

The notes on pages 16 to 53 are an integral part of these financial statements.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

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STATEMENT OF CASH FLOWS

FOR THE YEAR ENDED 31ST DECEMBER 2023

Group

Company

2023

2022

2023

2022

Notes

€

Cash flows from operating activities

Net profit/(loss) for the year/period

4,479,984

(1,021)

3,274,851

998

Adjustments for:

Depreciation

37,489

650

Finance cost

100

1,350,471

315,754

Share of profit of equity-accounted investees, net of tax

(3,230,281)

(3,263,400)

Interest receivable

(60,785)

(2,175)

(1,428,299)

(321,527)

Revaluation of investment properties

(1,100,000)

Net Cash from / (used in) operating activities

126,407

(2,446)

(66,377)

(4,775)

Trade and other receivables

(529,397)

(18,505)

(5,631)

(17,591,867)

Inventory – Development Project

(2,670,119)

Trade and other payables

1,134,147

12,376

863,137

101,926

Cash generated used in operations

(1,938,962)

(8,575)

791,129

(17,494,716)

Finance costs

(90,562)

(1,350,471)

(315,754)

Income tax

(38,990)

(349)

Net cash used in operating activities

(1,977,952)

(99,137)

(559,691)

(17,810,470)

Cash flows from investing activities

Purchase of fixed assets

(6,067,200)

Interest received

60,785

1,428,299

321,527

Acquisition of subsidiary, net of cash acquired

(9,571,234)

(7,914,837)

(10,948,390)

Impact to cash on acquisition of subsidiaries

1,260,175

Net cash (used in) / generated from investing activities

(15,577,649)

1,260,178

(6,486,538)

(10,626,863)

Cash flows from financing activities

Proceeds from issue of share capital

8,114,837

3,000

8,114,837

10,951,390

Proceeds from share premium

1,892,355

Repayments of bond advanced facility

(9,487,843)

Proceeds from bond advanced facility

9,487,843

Proceeds from the Bond issue

32,000,000

Movement in other financial liabilities

315

Movement in related parties

(2,491,039)

(17,488,427)

(8,923,675)

Repayments of loans & other borrowings

(4,348,016)

(8,000,000)

Proceeds from loans and other borrowings

8,000,000

Net cash from financing activities

25,680,294

2,731

15,595,674

28,439,233

Movement in cash and cash equivalents

8,124,693

1,163,772

8,549,445

1,900

Cash and cash equivalents at beginning of the year/period

1,163,772

1,900

Cash and cash equivalents at end of the year/period

9,288,465

1,163,772

8,551,345

1,900

The notes on pages 16 to 53 are an integral part of these financial statements.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

1Summary of material accounting policies

The material accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied to all periods presented, unless otherwise stated.

1.1Basis of preparation

These financial statements have been prepared in accordance with the requirements of International Financial Reporting Standards (IFRSs) as adopted by the European Union (EU) and with the requirements of the Maltese Companies Act, 1995. The financial statements are prepared under the historical cost convention, except as disclosed in the accounting policies below.

Critical accounting estimates and judgements

The preparation of financial statements in conformity with IFRSs as adopted by the EU requires the use of certain accounting estimates. It also requires the director to exercise his judgement in the process of applying the Group’s accounting policies. Estimates and judgements are continually evaluated and based on historical experience and other factors including expectations of future events that are believed to be reasonable under the circumstances.

In the opinion of the director, the accounting estimates and judgements made in the course of preparing these financial statements are not difficult, subjective or complex to a degree which would warrant their description as critical in terms of the requirements of IAS 1.

Standards, interpretations and amendments to published standards effective in 2023

The Group adopted new standards, amendments and interpretations to existing standards that are mandatory for the Group’s accounting period beginning on 1st January 2023.

The Group adopted Disclosures of Accounting Policies (Amendments to IAS 1 and IFRS Practice Statement) from 1st January 2023.

The amendments require the disclosure of ‘material’ rather than ‘significant’, accounting policies. The amendments also provide guidance on the application of materiality to disclosure of accounting policies, assisting entities to provide useful, entity specific accounting policy information that users need to understand other information in the financial statements.

Management reviewed the accounting policies and made updates to the information disclosed in Material accounting policies in certain instances in line with the amendments.

Other than the above the adoption of these revisions to the requirements of IFRSs as adopted by the EU did not result in substantial changes to the Group’s accounting policies.

Standards, amendments and interpretations to existing standards that are not yet effective and have not been adopted early by the Group and the Company.

At the date of authorisation of these financial statements, certain new standards, and amendments to existing standards have been published by the IASB that are not yet effective, and have not been adopted early by the Group.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

1Summary of material accounting policies – continued

1.1Basis of preparation – continued

Management anticipates that all relevant pronouncements will be adopted in the Group’s accounting policies for the first period beginning after the effective date of the pronouncement. The Group does not expect that the new standards, interpretations and amendments will have a material impact on the Group’s financial statements.

1.2Basis of Consolidation

Business combinations

The Group accounts for business combinations under the acquisition method when the acquired set of activities and assets meet the definition of a business and control is transferred to the Group. In determining whether a particular set of activities and assets is a business, the Group assesses whether the set of assets and activities acquired includes, at a minimum, an input and substantive process and whether the acquired set has the ability to produce outputs.

The consideration transferred in the acquisition is generally measured at fair value, as are the identifiable net assets acquired. Any goodwill that arises is tested annually for impairment. Any gain on a bargain purchase is recognised in profit or loss immediately. Transactions costs are expensed as incurred, except if related to the issue of debt or equity securities. The consideration transferred does not include amounts related to settlement of pre-existing relationships. Such amounts are generally recognised in profit and loss.

Juel Group p.l.c. was formed on 24 January 2022. Other than the Group company, the subsidiaries were already formed and in operation prior to 2022. Consequently, Juel Group p.l.c. entered in a business combination on 28 November 2022, when the holding company issued an allotment of new Ordinary A shares having a nominal value of €1 each, for a consideration of €10,948,390. The shares were issued and allotted for a non-cash consideration that was contributed in respect of the allotment of fully paid ordinary shares, having a nominal value of €1 each, held by the allottee in the subsidiary companies. The value of the non-cash consideration was equivalent to the value of the allotment of the net asset value of the subsidiaries as at 30 September 2022.

Subsidiaries

Subsidiary undertakings, which are those companies in which the Group, directly or indirectly, has an interest of more than one half of the voting rights or otherwise has power to govern the financial and operating policies have been consolidated. Subsidiaries are consolidated from the date on which effective control is transferred to the Group on 22nd December 2022, and are no longer consolidated from the date of disposal. Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. The Group financial statements include the financial statements of the parent Company and all its subsidiaries.

In the Company's financial statements, investments in subsidiaries are accounted for on the basis of the direct equity interest and are stated at cost less any accumulated impairment losses. Dividends from investments are recognised in the Statement of Profit or Loss and Other Comprehensive Income.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

1Summary of material accounting policies – continued

1.2Basis of Consolidation – continued

Interest in equity-accounted investees

The Group’s interest in equity-accounted investees compromise interests in associates.

Associates are those entities in which the Group has significant influence but not control or joint control, over the financial and operating policies.

Interest in associates is accounted for using the equity method. They are initially recognised as cost, which includes transaction costs. Subsequent to initial recognition, the consolidated financial statements including the Group’s share of the profit and loss and OCI of equity-accounted investees, up to the date on which significant control ceases.

Unrealised gains arising from transactions with equity-accounted investees are eliminated against the investment to the extent of the Group’s interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence on impairment.

1.3Segment reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments has been identified as the board of directors, responsible for making strategic decisions. The board of directors considers the Company to be made up of 3 segments, those being property development, property rental and the hotel operation. Since the hotel is not yet in operation and there was no revenue from the new projects of property held for development and resale, there was only one segment.

1.4Foreign currency translation

(a)Functional and presentation currency

Items included in these Financial Statements are measured using the currency of the primary economic environment in which the entity operates (the functional currency). These Financial Statements are presented in Euro, which is the Group’s functional currency and presentation currency.

(b)Transactions and balances

Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the statement of comprehensive income. Translation differences on non-monetary items, such as equities, are reported as part of the fair value gain or loss.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

1Summary of material accounting policies – continued

1.5Financial instruments

i. Recognition and initial measurement

Trade and other receivables are initially recognised when they are originated. All other financial assets and financial liabilities are initially recognised when the Company becomes a party to the contractual provisions of the instrument.

ii. Classification and subsequent measurement

Financial assets

On initial recognition, a financial asset is classified and measured at: amortised cost; FVOCI - debt investment; FVOCI - equity investment; or FVTPL.

Financial assets are not reclassified subsequent to their initial recognition unless the Company changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model.

A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at FVTPL:

• It is held within a business model whose objective is to hold assets to collect contractual cash flows.

• Its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding.

Financial liabilities - Classification, subsequent measurement and gains and losses

Financial liabilities are classified and measured at amortised cost or FVTPL. A financial liability is classified as at FVTPL if it is classified as held-for-trading, it is a derivative or it is designated as such on initial recognition. Financial liabilities at FVTPL are measured at fair value and net gains and losses, including any interest expense, are recognised in profit or loss. Other financial liabilities are subsequently measured at amortised cost using the effective interest method. Interest expense and foreign exchange gains and losses are recognised in profit or loss. Any gain or loss on derecognition is also recognised in profit or loss.

iii. Derecognition

Financial assets

The Group derecognises a financial asset when:

- the contractual rights to the cash flows from the financial asset expire; or

- it transfers the rights to receive the contractual cash flows in a transaction which either:

- substantially all of the risks and rewards of ownership of the financial assets are transferred; or

- the Group neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset.

The Group enters into transactions whereby it transfers assets recognised in its Statement of Financial Position, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognised.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

1Summary of material accounting policies – continued

1.5Financial instruments – continued

iii. Derecognition – continued

Financial liabilities

The Group derecognises a financial liability when its contractual obligations are discharged or cancelled, or expired. The Group also derecognises a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognised at fair value.

On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognised in profit or loss.

iv. Offsetting

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

v. Impairment

Simplified approach model

For trade and other receivables, the Group applies the simplified approach required by IFRS 9, which requires expected lifetime losses to be recognised from initial recognition of the receivables.

The expected loss rates are based on the payment profiles of sales over a period of 12 months before 31 December 2023 or after 01 January 2023 respectively and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the liability of the customers to settle the receivable. Receivables are written off when there is no reasonable expectation of recovery. Indicators that there is no reasonable expectation of recovery include, among others, the probability of insolvency or significant financial difficulties of the debtor. Impaired debts are derecognised when they are assessed as uncollectible.

1.6Share Capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds.

1.7Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events, it is possible that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate of the amount of the obligation can be made.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

1Summary of material accounting policies – continued

1.8Revenue and cost recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of goods and services in the ordinary course of the Group’s activities. Revenue is shown net of value added tax, returns, rebates and discounts. The Group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and when the specific criteria has been met as described below.

Sales of property are recognised when the significant risks and rewards of ownership of the property being sold effectively transferred to the buyer. This is generally considered to occur at the later of the contract of sale and the date when all the Group’s obligations relating to the property are completed and the possession of the property can be transferred in the manner stipulated by the contract of sale.

Amounts received in respect of sales that have not yet been recognised in the financial statements, due to the fact that the significant risks and rewards of ownership still rest with the Group, are treated as payments received on account and presented within trade and other payables.

Revenue from hospitality related to revenue from accommodation. Revenue from each operation is recognised one time since the customer benefits as the company is performing: the amount allocated to the performance obligation is recognised over the customer’s stay at the respective hotel.

Other operating income consisting of the following is recognised on an accruals basis:

Rental income

Interest

Dividends receivable are accounted for on a cash basis.

Costs are recognised when the related goods and services are sold, consumed or allocated, or when their future useful lives cannot be determined.

1.9Borrowing costs

Borrowing costs directly attributable to the acquisition and construction of property are capitalised as part of the cost of the project and are included in its carrying amount. Capitalisation of borrowing costs ceases when substantially all the activities necessary to prepare any distinct part of the project for its sale or intended use is completed. Borrowing costs which are incurred for the purpose of acquiring or constructing qualifying property, plant and equipment or investment property are capitalized as part of its cost. Borrowing costs are capitalized which acquisition or construction is actively underway and cease once the asset is substantially complete, or suspended if the development of the asset is suspended. All other borrowing costs are recognized as an expense in the Statement of Profit or Loss and Other Comprehensive Income in the period as incurred.

1.10Bank borrowings

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

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

1Summary of material accounting policies – continued

1.11Trade and other payables

Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities.

Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.

1.12Other financial liabilities

Other financial liabilities are recognized initially at fair value of proceeds received, net of transaction costs incurred. Other financial liabilities are subsequently measured at amortised cost using the effective interest method unless the effect of discounting is immaterial. Any difference between the proceeds, net of transaction costs, and the settlement or redemption of other borrowings is recognised in the Statement of Profit or Loss and Other Comprehensive Income over the term of the borrowings, unless the interest on such borrowings is capitalised in accordance with the Group’s accounting policy on borrowing costs.

1.13Property, plant and equipment

All property, plant and equipment are initially recorded at cost and subsequently stated at cost less depreciation.

Cost includes expenditure that is directly attributable to the acquisition of the items. Subsequent costs are included in the asset’s carrying amount when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. Expenditure on repairs and maintenance of property, plant and equipment is recognised as an expense when incurred.

Property, plant and equipment are stated at cost or valuation less accumulated depreciation. Depreciation is provided for on the straight line method in order to write off cost over the expected useful economic lives of the assets as follows:

	Years
Computer & Office Equip.	4
Motor Vehicles	5
Furniture & Fittings	10

The assets' residual values and useful lives are reviewed and adjusted if appropriate, at each statement of financial position date.

Gains and losses on disposal of property, plant and equipment are determined by comparing proceeds with the carrying amount, and are taken into account in determining operating profit.

An asset's carrying amount is written down immediately to its recoverable amount if its carrying amount is greater than its estimated recoverable amount.

Land is not depreciated.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

1Summary of material accounting policies – continued

1.14Investment property

Investment property is initially measured at cost and subsequently at fair value with any change therein recognised in profit or loss.

Any gain or loss on disposal of investment property (calculated as the difference between the net proceeds from disposal and the carrying amount of the item) is recognised in profit or loss. When investment property that was previously classified as property, plant and equipment is sold, any related amount included in the revaluation reserve is transferred to retained earnings.

Rental income from investment property is recognised as other revenue on a straight-line basis over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income, over the term of the lease.

1.15Leases

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

As a Lessor

At inception or on modification of a contract that contains a lease component, the Group allocates the consideration in the contract to each lease component on the basis of their relative stand-alone prices.

When the Group acts a lessor, it determines at lease inception whether each lease is a finance lease or an operating lease.

To classify each lease, the Group makes an overall assessment of whether the lease transfers substantially all of the risks and rewards incidental to ownership of the underlying asset. If this is the case, then the lease is a finance lease; if not, then it is an operating lease. As part of this assessment, the Group considers certain indicators such as whether the lease is for the major part of the economic life of the asset.

The Group recognises lease payments received under operating leases as income on a straight-line basis over the lease term as part of 'other revenue'.

The Group leases out its investment property to related parties. All leases are classified as operating leases.

As a Lessee

The Group leases out property from related parties. The Group has classified this lease as an operating lease because it does not transfer substantially all of the risk and rewards incidental to the ownership of the asset.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

1Summary of material accounting policies – continued

1.16Inventory – Stock Development Project

One of the objects of the Group is the development of land acquired for development and resale. This development is intended in the main for resale purposes and is accordingly classified in the financial statements as stock. Any elements of a project which are identified for business operation or long-term investment properties are transferred at their carrying amount to property, plant and equipment or investment properties when such identification is made, and the cost thereof can reliably be segregated.

The development is carried at the lower of cost and net realisable value. Cost comprises the purchase cost, net realisable value or the fair value as described in the paragraph above. Cost comprises the purchase cost of acquiring the land together with other costs incurred during its subsequent development, including:

(i)The cost incurred on development works, including demolition, site clearance, excavation, construction, etc., together with the costs of ancillary activities such as site security.

(ii)The cost of various design and other studies conducted in connection with the project, together with all other expenses incurred in connection therewith.

(iii)Any borrowing costs, including imputed interest, attributable to the development phases of the project.

The purchase cost of acquiring the land represents the cash equivalent of the contracted price. This was determined at date of purchase by discounting to present value the future cash outflows comprising the purchase consideration.

Net realisable value is the estimated selling price in the ordinary course of business, less the costs of completion and selling expenses.

1.17Cash and cash equivalents

Cash and cash equivalents as shown in the cashflow statement comprise of cash at bank and in hand and bank deposits. Bank deposits include funds held with the Trustee for disbursements to the contractors of the Hotel development.

1.18Taxation

Current and deferred tax is charged or credited to profit or loss, except when it relates to items charged or credited directly to equity, in which case the current tax is also dealt within equity.

The charge/credit for current tax is based on the taxable result for the period. The taxable result for the period differs from the result as reported in profit or loss because it excludes items which are not assessable or disallowed and it further excludes items that are taxable or deductible in other periods. It is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

Provision is made for deferred taxation, using the liability method, in respect of timing differences arising between the tax bases of assets and liabilities and their carrying values for financial reporting purposes. Deferred tax debits are only carried forward in so far as it is probable that future taxable profits will be available against which the tax losses and unabsorbed capital allowances can be utilised.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management

Risks relating to the Company

The Company’s Board of Directors has the responsibility for the establishment and oversight of the Company’s risk management framework. Accordingly, the Company’s Board of Directors provides principles for overall Company risk management, as well as policies covering the risks identified.

Risks relating to the Group

2.1Economic and Financial risks of the Group

i.Risks relating to the financing of the Group’s projects

The Group’s development projects have been part-financed through bank financing with local banks. The Group plans to incur additional debt for the purposes of financing future development projects. Notwithstanding that the Group aims at maintaining its debt-to-equity ratio at prudent levels with corresponding equity being injected at levels considered to be adequate and prudent under current banking practices, a substantial portion of the cash flow generated by the Group is utilised to repay the respective Company’s debt obligations pursuant to the terms of the facilities provided. Should a Group company significantly increase its debt obligations, this may have an adverse effect on the profitability of the respective company and the Group as a whole.

The agreements regulating the bank debt of the companies forming part of the Group impose significant financial covenants on the borrowing companies. These covenants could limit the ability of the said companies to obtain future financing, make capital expenditure, withstand a future downturn in business or economic conditions generally or otherwise inhibit the ability to conduct necessary corporate activities.

Changes in banking risk appetite as a result of financial turmoil may decrease the willingness of banks to provide loans to companies and the terms thereof. As a result of the factors detailed herein, a Group company may not be able to obtain the capital and financing it requires for the completion of a project and, or the operation of its business, on commercially viable terms, or at all.

ii.Risks relating to rising costs for materials, resources, and utilities.

The Group operates in both the property industry and the hospitality industry. As part of the property development component of the Group’s business, the Group is currently developing the: (i) The Hyatt Centric Hotel; (ii) Marsascala Development I; and (iii) Marsascala Development II. On completion of the afore-mentioned projects, the Group will seek additional property development opportunities through its associate company ACMUS Group Limited. As part of the hospitality component of its business, the Group will operate the Hotel. Both industries necessitate the availability of certain resources (including human resources), materials and utilities, at cost-effective prices.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management - continued

2.1Economic and Financial risks of the Group - continued

ii.Risks relating to rising costs for materials, resources, and utilities - continued

The Group’s principal operational risks relate to its ability to deliver projects within agreed project deliverables, including project design specifications, quantity requirements, the involvement of qualified and skilled personnel, adequacy of resources and equipment, technical and industry standards, certification requirements, scheduled programme of works, fitting and finishing specifications and, ultimately, within project budgeted costs and stipulated project deadlines. Non-compliance with the Group’s committed projected deliverables could result in significant penalties (including daily penalties for mere delay), fines, pre-liquidated damages, or other damages, and, or early termination of project contracts and related contracts. Furthermore, the Group may be susceptible to liability for costs, expenses, losses, forfeit of or reduction in project revenue, or other liabilities incurred to remedy defects or repairs.

Over the last 3 years, the prices of raw materials have been subject to substantial increases caused by a combination of heightened market demand and low availability, ongoing global supply chain challenges, increase in shipping costs, shortages in containers, ships, and human resources. Accordingly, a surge in prices has been witnessed for, inter alia, aluminium, steel, copper, oil, wood, and paper. Furthermore, in respect of the Group’s hospitality arm, the Group is also exposed to an increase in food prices. Should the volatility in prices continue in an upward trajectory over the rest of the year as well as subsequent years, the Group may be negatively affected if these increased costs are not capable of being reflected in increased charges for the delivery of certain products and services of the Group.

The Group may be unable to maintain an adequate stock of the materials and resources it requires, including the appropriate workforce for the Group’s development projects resulting in increased costs and project delays. The Group’s inability to comply with its obligations in both the property development and hospitality sectors, could adversely impact the Group’s relations with its customers and suppliers, prejudice its goodwill, prejudice its contractual commitments in terms of the Franchise Agreement and, or could result in a material adverse effect on the financial position, financial performance, and operational results of the Group.

iii.Risks relating to aversion to travel due to the war in Ukraine.

In response to the invasion of Ukraine by Russia, several industries implemented boycotts, bans and other forms of retaliation against Russia. With regards to the travel industry, a reduction in tourist arrivals (irrespective of nationality) may stem from a greater aversion to travel in times of political unrest and threats of conflict and war in other countries. Travellers may be reluctant to leave their home countries due to the uncertainty of the international situation and or may postpone any travel arrangements to a future date amid the ongoing crisis. Other events which could bring about a reduction in travel include actual or threatened acts of terrorism and civil unrest.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.1Economic and Financial risks of the Group – continued

iii.Risks relating to aversion to travel due to the war in Ukraine - continued

The availability of flights at affordable rates may influence one’s decision to travel to Malta over other destinations, specifically destinations which offer a similar experience. As a result of the invasion of Ukraine by Russia and the retaliatory efforts of other countries, the price of oil and gas soared and in turn fuel prices experienced an all-time high, potentially implying a greater cost for airlines. Increased costs for airlines may be subsequently borne by consumers through an increase in flight prices, rendering air travel more costly for interested travellers and thus serving as a deterrent for travel in general.

The exact duration and effects of the war in Ukraine and the financial and economic effects it will have on international travel and the local hospitality and tourism industry are inherently difficult to predict with any degree of accuracy. Consequently, the Group’s business, operations, and financial performance remain susceptible to the risk of an increased aversion or appetite to travel directly or indirectly related to the effects of the war in Ukraine.

2.2Operational risks of the Group

i.Risks relating to the Franchise Agreement

The Hotel will form part of the “HYATT CENTRIC®” chain of hotels, a reputable international brand which has hotels across the globe. Juel Hospitality shall operate the Hotel under the “HYATT CENTRIC®” brand in terms of the Franchise Agreement. Pursuant to the Franchise Agreement, the Franchisor granted Juel Hospitality the non-exclusive right and obligation to use certain intellectual property of the Franchisor (including the “HYATT CENTRIC®” brand) as well as its systems. Juel Hospitality (as franchisee) is required to comply with certain conditions as part of the Franchise Agreement, including but not limited to: (i) the timely construction, maintenance and opening of the Hotel; (ii) the satisfaction of performance thresholds under quality assurance programs to which it is subject under the Franchise Agreement; and (iii) compliance with certain required standards under the Franchise Agreement. The breach of any of the conditions in the Franchise Agreement could result in the termination of the Franchise Agreement prior to the expiration of its term or the suspension thereof. Moreover, the Franchisor may impose penalties seek to claim damages suffered as a result of the breach of any of the conditions of the Franchise Agreement. Accordingly, the success of the Hotel operations is dependent on the continuity of the contractual relationship with the Franchisor.

Should the Franchise Agreement be terminated or not renewed, the profitability and financial condition of the Group may be materially adversely affected in view of its inability to benefit from the reputation and standards of the “HYATT CENTRIC®” brand.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.2Operational risks of the Group – continued

ii.Risks relating to the loss of senior management and other key personnel

The Group believes that its growth is partially attributable to the efforts and abilities of its executive director, and other key personnel, including members of senior management, sales, investment, and project management personnel and upon its ability to attract, develop and retain such key personnel to manage and grow the business.

If one or more of the members of this team were unable or unwilling to continue in their present position, particularly if such members are lost to competitors of the Group, the Group might not be able to replace them within the short term, which could have a material adverse effect on the Group’s business, financial condition, and results of operations.

iii.Risks relating to competing projects

The local hospitality industry is highly competitive given the variety of temporary accommodation available on the market. Accordingly, once completed, the Hotel may compete with local hotels and facilities offering various types of lodging options and related services to the public. Although the Hotel gives a level of comfort through Hyatt Brand loyalty, there can be no assurances that the Hotel will not have strong competitors in the future in the surrounding areas in which it operates.

The Group’s activities in the property development and rental sectors are also susceptible to competitive forces given the large number of properties and developments available on the local market. Should there be an increase in similar property developments which are of a similar quality and type to those being constructed, sold, or leased by the Group, particularly where such competing developments are available at cheaper prices, the Group may be unable to sell or otherwise lease the units, garages and, or developments (as applicable) forming part of the Group’s property portfolio, in a cost-effective and efficient manner.

A reduction in reservations for hotel accommodation and, or the sale of units and prices which are lower than that projected may adversely affect the Group’s business, financial condition, and results of operations.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.2Operational risks of the Group – continued

iv.Risks relating to changes in consumer preferences and demand

The Group’s success in the property development, rental and hospitality sectors is dependent on its ability to offer products and services that have a strong consumer appeal. Such sectors are susceptible to fluctuations in consumer trends because of changes in taste, consumer habits, general economic conditions, social trends, consumer attitude, consumer satisfaction and any other similar factors which are linked to consumer demand. The property market, whether for resale or letting purposes, is subject to changing preferences in the style and location of immovable properties. In the case of the hospitality sector, consumer preferences are largely determined by brand image and reputation. Brand images are key to the business of the Group and thus the inability to maintain a positive brand image could have a material adverse effect on the Group’s revenue and results of operations. It cannot be predicted whether advertising, marketing and promotional programs will have the desired impact on its products and services branding and on consumer preferences.

The Group’s success in such sectors is dependent on its ability to swiftly anticipate, capitalise and adapt to changes in consumer attitude and preferences. Should the Group fail to do so, it may experience a reduction in revenue which could have a material adverse effect on its operational results and financial condition.

v.Risks relating to the Group’s insurance policies

No assurance can be given that the Group’s current insurance coverage would be sufficient to cover all potential losses, regardless of the cause, nor can any assurance be given that an appropriate coverage would always be available at acceptable commercial rates. In addition, changes in legislation or judicial interpretation, or the issuance or alteration of directives, orders, or other measures (whether interim or otherwise), by the relevant authorities may impact the ability to recoup losses under insurance coverage held by the Group. Furthermore, the actions, or inactions of employees or other officials of the Group, or of contractors, sub-contractors, outsourcing parties, or other third parties engaged by the Group from time to time, may affect the ability of the Group to successfully make a claim under its insurance policies.

2.3Risks specific to the property sector

The Group is heavily invested in the property acquisition, development, and management markets, which are constantly evolving market segments characterised by specific risks and uncertainties. The Group is thus intrinsically susceptible to the risks associated with activities in these market segments. The occurrence of any of the factors referred to below could negatively affect the Company’s financial condition and results.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.3Risks specific to the property sector - continued

i.Risks relating to property development and the construction industry

The Group undertakes activities in the property development and construction industry. As detailed above, the Group is developing the: (i) Hyatt Centric Hotel; (ii) Marsascala Development I; and (iii) Marsascala Development II.

Pursuant to such activities, the Group is subject to several specific risks, including:

(a)the risk of delays, including albeit not limited to delays in obtaining any necessary permits and cost overruns;

(b)the possibility of delays pursuant to a strain on the availability of human and other capital resources required for the development and completion of such projects resulting from heightened levels of activity in the sector;

(c)covenants, conditions, restrictions, and easements relating to the properties or their use, whether arising out of law, contractual arrangement, or orders or other decisions of the competent judicial or government authorities;

(d)government restrictions concerning the free movement of people and goods, which might result in delays or changes in terms of established trade supply routes, changes in macro-economic conditions, as well as market and regulatory changes affecting the construction and property development processes.

The occurrence of any of the risk factors described above could have a material adverse effect on the Group’s business, financial condition, and results of operations, including the increase of projected costs and times for completion of ongoing development projects.

ii.Risks relating to the sale of property

The Group’s business contemplates the construction and finishing of property developments and the subsequent sale or rental of the individual units / garages / car spaces forming part of such property developments. Whilst the Group’s activities in this sector, have been largely successful, there can be no assurance that the Group will be able to sell future developments in a profitable and efficient manner on account of: (a) market conditions; (b) the size and, or value of the property development; (c) specific local market conditions; (d) regulatory risks including, albeit not limited to, the delay in obtaining or the inability to obtain the necessary permits (e) other local or international economic factors influencing the Group’s operations or assets. It may also prove necessary to dispose of houses / units / garages / car spaces at values which management considers to be reasonable in the circumstances prevailing at the time, but which represent discounts to book values or earlier property valuation reports, in order to be able to meet long-term strategy and financing objectives.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.3Risks specific to the property sector – continued

iii.Risks relating to the engagement and, or the involvement of third parties in connection with the Group’s business and associated counterparty risks

The Group relies upon third-party service providers such as architects, building contractors and suppliers for the construction and completion of each of its developments. The Group has engaged, and shall continue to engage, the services of third-party contractors for the purposes of all the developments, including the excavation and construction of the Hotel in a timely manner and within agreed cost parameters. This gives rise to counter-party risks in those instances where such third parties do not perform in line with the Group’s expectations and in accordance with their contractual obligations. If these risks were to materialise, this will result in delays in the development and completion of the Hotel as well as other development projects undertaken by the Group, which could have an adverse impact on the Group’s business, its financial condition, results of operations and prospects. Delays in the development and completion of the Hotel could have a material adverse impact on the Company’s cash flows and revenue generation.

iv.Risks relating to the rental income of the property retained by the Group

The Group has a property portfolio of over 30 units which it leases under the “StayMela” brand. Given that the majority of the Group’s customers are tourists, the revenue generated from such rental activities is dependent on the number and frequency of people travelling to Malta. Therefore, the risks attributable to the hospitality and tourism industry apply to the Group’s rental activities under the “StayMela” brand.

v.Risks relating to property valuations and net realisable value

The valuations are prepared by external independent property valuers having appropriate recognised professional qualifications and recent experience in the location and category of the property being valued. However, the valuation of property is intrinsically subjective and based on several assumptions at a given point in time. In providing a market value of the respective property, the architect makes certain assumptions which ultimately may cause the actual values to be materially different from any future values that may be expressed or implied by such forward-looking statements or anticipated on the basis of historical trends as reality may not match the assumptions. Subsequently, the Group may purchase and, or have purchased property based on inaccurate valuations. Moreover, property valuations are largely dependent on current and, or, expected market conditions which may fluctuate from time to time. There can be no assurance that the property valuation and property-related assets will reflect actual market values.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.4Risks specific to the hospitality and tourism industry

The Group’s activities in the hospitality and tourism industries comprise the operation of the Hotel once completed and its rental activities under the brand “StayMela”. The hospitality and tourism industries are susceptible to several factors which may impact the operations and revenue of owners and operators alike. Such factors include as follows:

•changes in travel patterns or seasonal variations, as well as consumer preferences concerning price, quality, location, and type of hospitality packages;

•any cutbacks and stoppages on Malta-bound air or sea travel routes, or increases in taxes, surcharges and other expenses associated therewith, as well as the imposition of travel restrictions, bans or other measures by the relevant authorities;

•changes in laws and regulations, including those concerning the management and operation of hotels and other hospitality outlets, employment, catering and entertainment establishments, health and safety, alcohol licensing, environmental concerns, fiscal policies and zoning and development, and the related costs of compliance.

•the maintenance of licences and other authorisations, as may be required from time to time, to operate and manage hospitality establishments;

•the impact of increased threats of terrorism or actual terrorist events, impediments to means of transportation (including airline strikes and border closures, or other travel restrictions), extreme weather conditions, natural disasters, travel-related accidents, outbreaks of diseases and health concerns, or other factors that may affect travel patterns and reduce the number of business and leisure travellers;

•increased competition from providers of alternative accommodation, including web-based booking channels that allow private accommodation to be made available by private individuals or via online peer-to-peer platforms, and other hospitality models such as bed and breakfasts (B&Bs), room-sharing and flexi-renting, and short-term lets of private property which may be offered at competitive rates.

The impact of any of these factors (or a combination of them) may adversely affect room rates and occupancy levels at the Hotel and, or the reservation of the residential units available for rent under the “StayMela” brand. In turn, this may cause a reduction in the income generated from the Group’s hospitality division which would have a material adverse effect on the Group’s business, financial condition, and results of operations and, in turn, on its ability to meet its obligations on time and in full.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.5Legal, regulatory and compliance risks

i.Risks relating to the regulatory environment in which the Group operates

The Group’s activities in the construction and development industry, as well as the Group’s activities in the hospitality industry (including the rental of property under the “StayMela” brand and its operation of the Hotel, once complete), are subject to a vast array of rules and regulations, including but not limited to, environmental protection, property and rental law, construction, property acquisition, property development, consumer law, health, fire, and safety, among others. Furthermore, the regulatory environment in which the Group operates is constantly evolving, with the introduction of new rules and regulations, or the amendment or overhaul of existing ones. In addition, the Group is susceptible to changes in the application and, or interpretation of such rules and regulations, whether as a result of judicial interpretation or due to decisions, orders, directives, and, or guidelines issued by the competent regulatory authorities.

Laws and regulations, which may be amended over time, may also impose liability for the presence of certain materials or substances or the release of certain materials or substances into the air, land or water or the migration of certain materials or substances from a property investment, including asbestos, and such presence, release or migration could form the basis for liability to third parties for personal injury or other damages. These environmental liabilities, if realized, could have a material adverse effect on the Group’s business, financial condition, and results of operations in the property development sector.

The inability of the Group to meet its ongoing regulatory and legal requirements, whether in whole or in part, or the inability of the Group to equip itself to comply with forthcoming legislation or regulation in a timely and suitable manner, may expose the Group to the risk of regulatory sanctioning, including but not limited to, the imposition of public reprimands, administrative or punitive fines or penalties, temporary suspension of activities, or even revocation of licences, permits, or other authorisations, whether in whole or in part. In addition, lack of compliance with legal and regulatory requirements may negatively affect the reputation and goodwill of the Group and may result in a loss of existing or potential business, and, or a weakened competitive advantage. If any of these risks were to materialise, they could have a material adverse effect on the operational results, financial performance, and financial position of the Group.

ii.Risks relating to personal data protection and privacy laws.

In the ordinary course of its activities, particularly with respect to the Group’s hotel operations once the Hotel is completed, the Group receives, processes, transmits and stores information relating to identifiable individuals (“personal data”). As a result, the Group is subject to various local laws and EU regulations relating to the collection and processing of personal data. These laws impose operational requirements for companies receiving or processing personal data and provide for significant penalties for non-compliance. These requirements with respect to personal data have subjected and may continue in the future to subject the Group to, among other things, additional costs and expenses and have required and may in the future require costly changes to their business practices and information security systems, policies, procedures, and practices.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.5Legal, regulatory and compliance risks – continued

ii.Risks relating to personal data protection and privacy laws – continued

Security controls over personal data, the training of employees on data privacy and data security, and the policies, procedures, and practices implemented, or which may be implemented in the future, may not prevent the improper disclosure of personal data by the Group.

Unauthorized access or improper disclosure of personal data in violation of personal data protection or privacy laws could harm the reputation of the Group, cause loss of consumer confidence, subject it to regulatory enforcement actions (including fines), and result in private litigation against the Group and, or Group companies, which could result in loss of revenue, increased costs, liability for monetary damages, fines and, or criminal prosecution, all of which could negatively affect the business and operating results of the Group.

2.6Risks relating to the failure to implement environmental, social and governance considerations in the Group’s business model

There is a growing expectation for companies to implement sustainability risks and consider sustainability factors in their day-to-day management and their decision-making process. With an increased emphasis on environmental, social and governance (“ESG”) considerations at global level, the implementation of sustainable factors in the Company’s business model is likely to become under increased scrutiny by investors, regulators, and the public at large.

The Group’s business entails three main sectors of operation: property development, rental of property and hospitality. ESG considerations for the purposes of the Group’s business may include, but are not limited to, energy performance, energy and resource efficiency, waste management, energy and water use, the use of renewables, as well as social and employment considerations of workers and the health and safety thereof.

In particular, risks relating to the impact of climate change, through physical and transitional channels, including but not limited to, physical risks related to severe weather events, the rise in sea level, and other natural disasters; and transition risks attributable to regulatory, technological, and market or pricing changes, could have economic, operational and financial impacts on the Group, and accordingly the failure by the Group to manage these risks over the short, medium, and long term could have a material adverse effect on the Group’s business operations, financial performance and prospects.

From a governance perspective, risks may arise relating to lack of skilful management or good governance within the Group and the inadequacy of proper control. Said risks cover a wide spectrum of areas including financial crime, regulatory compliance, fraud, systems, and processes which would in turn affect income and capital. Failure to manage these risks may result in negative impacts on the Group’s business and reputation.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.6Risks relating to the failure to implement environmental, social and governance considerations in the Group’s business model – continued

Should the Group fail to operate its business in each sector in a sustainable manner, the failure to implement sustainable factors in the Group’s business operations may also have a material adverse effect on the Group’s reputation and public image in each sector as well as its relationship with clients, suppliers, business partners (including the Franchisor) and other stakeholders. This in turn, may have a material adverse impact on the Group’s business activities, revenues, financial condition, and operations.

2.7Financial risk factors

(i) Liquidity risk

The Group is exposed to liquidity risk in relation to meeting future obligations associated with its financial liabilities, which comprise principally trade and other payables and borrowings. Prudent liquidity risk management includes maintaining sufficient cash to ensure the availability of an adequate amount of funding to meet the Group’s financial obligations and to safeguard the Company’s ability to continue as a going concern, in particular to complete of the Group’s projects in a timely manner.

The Group regularly requires further funding to finish its ongoing projects and investments in new ones. The funding should be available from a mix of own Reserves, bank finance and/or capital markets and creditors. There is no certainty that the Group will be able to obtain the full capital it requires, and this may effect the ability of the Group to deliver these projects on time.

Notwithstanding these challenges, the Group has ample experience in the industry and has always managed to obtain the appropriate funding and completed projects within pre-determined time-frames.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.7Financial risk factors - continued

(i) Liquidity risk - continued

Maturity analysis

The Group’s trade and other payables are entirely repayable within one year from the end of the reporting period. The following table analyses the Group’s borrowings, lease liabilities and deposits arising under operating leases classified as other payables into relevant maturity groupings based on the remaining period from the end of the reporting period to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows.

	CARRYING AMOUNT	LESS THAN 1 YEAR	BETWEEN 1 AND 2 YEARS	BETWEEN 2 AND 5 YEARS	AFTER 5 YEARS	TOTAL CONTRACTUAL CASH FLOWS
	€	€	€	€	€	€
31st December 2023
Bank loans	9,715,761	3,002,217	2,345,934	1,200,000	5,356,849	11,905,000
Debt securities	32,000,000	-	-	-	49,600,000	49,600,000
Trade and other payables	5,024,565	5,024,565	-	-	-	5,024,565

	CARRYING AMOUNT	LESS THAN 1 YEAR	BETWEEN 1 AND 2 YEARS	BETWEEN 2 AND 5 YEARS	AFTER 5 YEARS	TOTAL CONTRACTUAL CASH FLOWS
	€	€	€	€	€	€
31st December 2022
Bank loans	14,063,777	8,000,000	3,563,777	1,200,000	4,492,223	17,256,000
Debt securities	-	-	-	-	-	-
Trade and other payables	4,737,029	4,737,029	-	-	-	4,737,029

(ii) Capital risk management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern; to maximise the return to stakeholders through the optimisation of the debt and equity balance and to comply with the requirements of the Prospectus issued in relation to the 5.5% Secured Bonds 2035.

The capital structure consists of items presented within equity in the Statement of Financial Position. The Group monitors the level of debt against total capital on an ongoing basis.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

2Financial risk management – continued

2.7Financial risk factors - continued

(iii) Credit risk

Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument leading to a financial loss.

The Group is not significantly exposed to credit risk arising in the course of its principal activity relating to the sale of residential units in view of the way promise of sale agreements are handled through, in the majority of cases, receipt of payments on account at established milestones up to delivery. The Group monitors the performance of the purchases throughout the term of the related agreement in relation to meeting contractual obligations and ensures that contract amounts are fully settled prior to delivery of the residential unit.

Credit risk mainly arises from cash and cash equivalents. Credit risk relating to financial assets is addressed through careful selection of the issuers of securities bought by the Company. All such transactions have been authorised solely by the Company’s Trustee of the 5.5% Secured Bonds 2035.

Furthermore, the Group manages its credit risk exposure in relation to receivables from fellow companies in an active manner, at arm’s length and with accrued interest charges thereon with the exception of ACMUS Group Limited where interest is not charged on its payables to Muscat Holdings (II) Limited and/or share of profits on project completion thereon. The Board retains direct responsibility for monitoring the investments made by the fellow companies. The Board considers these receivables to be fully performing and recoverable.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

3Revenue

Revenue is made up as follows:

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Other revenue	33,300	5,404	33,300	-
Revenue from property held for development and resale	20,000	-	-	-
Revenue from property rentals	696,257	-	-	-
	749,557	5,404	33,300	-
		6,802,968

The Group has 3 distinct business segments, these being property development, property rentals and hotel operations. The revenue for 2023 mainly emanated from revenue from short lets accommodation. There was no revenue generated from the new projects of the property held for development and resale. The hotel was not yet in operation during 2023. Consequently, segment reporting was not taken into consideration as there was only one material segment in 2023.

4Other Income

Group

Company

2023

2022

2023

2022

€

Increase in fair value of investment property

1,100,000

6,802,968

5Operating profit / (loss)

Operating profit / (loss) for the year/period is stated after charging:

Group

Company

2023

2022

2023

2022

€

Directors’ fees (Note 7)

104,500

28,500

Employment costs (Note 6)

177,359

1,800

10,180

Depreciation (Note 11)

37,489

650

Audit fees – Annual statutory audit

19,792

1,650

10,692

1,500

Other Assurance services

7,316

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

6Employees

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Employment costs comprise:
Wages and salaries - administration	10,180	-	10,180	-
Wages and salaries – allocated to cost of sales	160,306	1,650	-	-
Social security costs – allocated to cost of sales	-	150	-	-
Social security costs – administration	6,873	-	-	-
	177,359	1,800	10,180	-

The average weekly number of persons employed by the Group during the year/ period was:

7Directors’ emoluments

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Directors’ salary – allocated to cost of sales	71,000	-	-	-
Directors’ Remuneration	33,500	-	28,500	-
	104,500	-	28,500	-

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

8Finance costs

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Finance costs
Finance costs incurred during the year/period	1,350,933	315,754	1,350,471	315,754
Finance costs recharged to related parties	(1,350,933)	(315,654)	-	-
	-	100	1,350,471	315,754

Finance costs allocated to cost of sales
At 1st January	122,441	-	-	-
Interest capitalised during the year/period	252,304	122,441	-	-
At 31st December	(371,745)	(122,441)	-	-
Charge of capitalised interest for the year/period	3,000	-	-	-

9Finance income

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Interest from Maltese banks	9	134	-	-
Interest receivable from related parties	-	2,043	459,489	321,527
Interest receivable from investments	60,776	-	29,325	-
Bond interest recharged to subsidiaries	-	-	939,485	-
	60,785	2,177	1,428,299	321,527

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

10Tax expense

The parent Company and Group’s income tax charge for the year/period has been arrived at as follows:

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Income tax expense
Income tax on taxable income at 15%	5,521	-	4,399	-
Income tax subject to final tax of 8% on sales of immovable property	1,600	-	-	-
Income tax subject to 35%	48,534	349	-	349
Deferred tax	81,782	(2,596)	(6,256)	-
Tax charge	137,437	(2,247)	(1,857)	349

The accounting profits and the tax charge for the year/period are reconciled as shown hereunder:

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Net profit / (loss) for the year/period	1,247,204	(1,021)	11,451	998
Income tax thereon at 35%	436,521	(359)	4,008	349
Capital allowances not reflected by way of depreciation	69	-	-
Difference arising from interest received	(7,362)	-	(5,865)	-
Difference resulting from different tax rates on bank interest received	1	-	-	-
Expenses disallowed for tax purposes	6,675	(1,888)	-	-
Difference arising on income subject to 5-8% withholding tax on sales of immovable property	906	-	-	-
Further allowances on rental income	(10,464)	-	-	-
Deferred tax asset arising from claimable losses brought forward	7,216	-	-	-
Difference arising on revaluation of property	(297,000)	-	-	-
Diminution of investments	875	-	-	-
	137,437	(2,247)	(1,857)	349

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

11Property, plant and equipment

Group 2022	Land & Buildings	Computer &equipment	Motorvehicles	Furniture &Fittings	Total
	€	€	€	€	€
Cost
Acquisitions through subsidiaries	20,880,753	16,836	19,600	289,086	21,206,275
At 31st December 2022	20,880,753	16,836	19,600	289,086	21,206,275
Depreciation
Acquisitions through subsidiaries	-	6,855	11,685	58,534	77,074
Charge for the period	-	54	75	521	650
At 31st December 2022	-	6,909	11,760	59,055	77,724
Net book value
At 31st December 2022	20,880,753	9,927	7,840	230,031	21,128,551

Group 2023	Land & Buildings	Computer &equipment	Motorvehicles	Furniture &Fittings	Total
	€	€	€	€	€
Cost
At 1st January 2023	20,880,753	16,836	19,600	289,086	21,206,275
Additions during the year	6,063,714	3,124	-	352	6,067,190
At 31st December 2023	26,944,467	19,960	19,600	289,438	27,273,465
Depreciation
At 1st January 2023	-	6,909	11,760	59,055	77,724
Charge for the year	-	4,625	3,920	28,944	37,489
At 31st December 2023	-	11,534	15,680	87,999	115,213
Net book value
At 31st December 2023	26,944,467	8,426	3,920	201,439	27,158,252
At 31st December 2022	20,880,753	9,927	7,840	230,031	21,128,551

The hotel was not in operation in 2023 and so no depreciation was provided for during the year.

The Company did not have any property, plant and equipment during the year ending December 2022 and 2023.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

12Investment property

12.1Recognition of carrying amount

	2023	2022
	€	€
Balance as 1 January	10,700,000	10,700,000
Acquisitions	-	-
Change in fair value	1,100,000	-
Balance at 31 December	11,800,000	10,700,000

Investment property comprises of commercial properties that are leased to third parties and to related parties.

12.2Amounts recognised in profit or loss

Rental income recognised by the Group during 2023 was €696,257 (2022: NIL) and was included with revenue, refer to note 3.

12.3Measurement of fair value

Fair value hierarchy

The value of investment property is reviewed by the Directors of each company after seeking the professional advice of external, independent property valuers, having appropriate recognised professional qualifications and recent experience in the location and category of the property being valued.

The independent valuers provide the fair value of the Group’s investment property portfolio every year.

The independent valuers estimate the market value of the investment property held by the subsidiary companies as at 31st December 2023 at €11,800,000. The amount of €11,800,000. The increase in fair value amounting to €1,100,000 was accounted for through profit and loss.

The valuation of the Investment properties was carried out by using the comparative method and was then cross checked by applying the investment method. By referring to the databases of reputable local real estate agencies, the market values of these properties were checked for comparisons to be drawn. The values were then capitalised at the rate of 5% which is deemed to be the average percentage return on investment for similar properties in Malta.

13Deferred tax liability

The deferred tax liability of €944K (2022 – €856K) arose mainly from the deferred tax effect on the revaluation of the investment property.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

14Investments in subsidiary undertakings

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Shares in subsidiary undertakings
Muscat Holdings Limited (C77653) - 200,000 ordinary shares of €1 each representing 100 % holding (Avian Hill,Triq L- Ispanjulett C/W Triq Il- Gallina, Kappara, San Gwann)	-	-	7,107,514	7,107,514
Muscat Holdings (II) Limited (C89275) – 100,000 ordinary shares of €1 each representing 100 % holding (Avian Hill,Triq L- Ispanjulett C/W Triq Il- Gallina, Kappara.)	-	-	1,921,328	1,921,328
JUEL Holdings Limited (C92861) – 1,200 ordinary shares of €1 each representing 100 % holding (Avian Hill,Triq L- Ispanjulett C/W Triq Il- Gallina, Kappara.)	-	-	1,904,436	1,904,436
JUEL Hospitality Limited (C100482) – 20,000 ordinary shares of €1 each representing 100 % holding (Avian Hill,Triq L- Ispanjulett C/W Triq Il- Gallina, Kappara.)	-	-	15,112	15,112
	-	-	10,948,390	10,948,390

The percentage of shares held directly by the Company are 100%.

The movement in the subsidiaries for the year ending 31 December 2023 are shown below:

Group

Company

2023

2022

2023

2022

€

At 1st January

10,948,390

Additions

As at 31st December

10,948,390

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

15Equity-accounted investees – Investment in associates

Investment in associates represents the 33.33% equity interest in GAP Group Investments (II) Limited and the 49.99% shareholding in ACMUS Group Limited.

On 14th April 2023, Juel Group p.l.c. acquired an equity interest of 33.33% in GAP Group Investments (II) Limited. GAP Group Investments (II) Limited is the parent company of GAP Group p.l.c. who is the parent company of subsidiaries operating in the property development industry. The registered address of GAP Group p.l.c and GAP Group Investments (II) Limited is Plan Group Head Office, Triq il-Wirt Naturali, Bahar-ic-Caghaq, Naxxar.

The Group’s share of the results of the interest in associate and its share of the assets and liabilities is laid out below:

	Group	Company
Percentage ownership interest		33% 33%
	€	€
Non-current assets	13,913,680	13,931,680
Current assets	82,115,771	82,115,771
Non-current liabilities	26,446,522	26,446.522
Current liabilities	36,051,762	36,051,762
Total equity (100%)	33,531,167	33,531,167
Group’s share total equity (33.33%)	11,175,938	11,175,938
Carrying amount of interest in associate	11,175,938	11,175,938

Group

Company

Percentage ownership interest 33% 33%

€

Revenue

42,763,849

Profit from continuing obligations

9,655,795

Other comprehensive profit

135,382

Total comprehensive income (100%)

9,791,177

Group‘s share of comprehensive income (33.33%)

3,263,400

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

15Equity-accounted investees – Investment in associates – continued

On 16th February 2023, one of the subsidiaries of the Group acquired 49.99% of the shares in ACMUS Group Limited. The main trading activity of ACMUS Group Limited will be the sale of property held for development and resale. The registered address of ACMUS Group Limited is JUEL GROUP, Avian Hill, Triq L-Ispanjulett C/W Triq il-Gallina, Kappara, San Gwann SGN 4042 Malta. It had no revenue during the year.

	Group	Company
Percentage ownership interest	49.99%	49.99%
	€	€
Non-current assets	49,897		-
Current assets	10,484,807		-
Non-current liabilities	7,160,100		-
Current liabilities	128,060		-
Total equity (100%)	3,246,544		-
Group’s share total equity (49.99%)	1,623,279		-
Carrying amount of interest in associate	1,623,279		-

	Group	Company
Percentage ownership interest	49.99%	49.99%
	€	€
Revenue	-		-
Loss from continuing obligations	(66,252)		-
Other comprehensive loss	-		-
Total comprehensive loss (100%)	(66,252)		-
Group‘s share of comprehensive loss (49.99%)	(33,119)		-

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

16Other financial assets

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Amount receivable from Juel Hospitality Limited - Maturity date 2035	-	-	24,408,601	17,591,867
	-	-	24,408,601	17,591,867

At 31st December 2023, the amount due by JUEL Hospitality Limited of €24,408,601 (2022 - €17,591,867) is expected to be repaid by May 2035. The amount receivable is payable over a period of 12 years at an interest rate of 5.525%.

17Inventory – Development project

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Property cost of land and development costs	8,486,539	6,065,724	-	-
Capitalised borrowing costs (See Note 8)	371,745	122,441	-	-
	8,858,284	6,188,165	-	-

18Trade and other receivables

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Trade receivables	142,384	1,850	-	-
Other receivables	2,302	84,760	-	-
Prepayments & accrued income	1,187,893	4,734	5,631	-
Amount due from shareholders	-	773,973	-	-
Amount due from subsidiaries	-	-	2,102,363	-
Amount due from related parties	1,644,428	-	1,644,428	-
Other taxation	113,428	51,293	-	-
	3,090,435	916,610	3,752,422	-

The amounts due from shareholders, subsidiaries and related parties are interest free, unsecured, and repayable on demand.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

19Cash and cash equivalents

Cash and cash equivalents included in the cash flow statement comprise:

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Cash at bank and in hand	-	10,804	-	-
Bank deposits	9,288,465	1,152,968	8,551,345	1,900
	9,288,465	1,163,772	8,551,345	1,900

The bank deposits of the Group include an amount of Eur9,006,952 which is held at the security trustee of Juel Group p.l.c., in their capacity as security trustees of the holders of the Juel Group p.l.c. Eur32,000,000 5.5% Secured Bonds 2035.

20Share capital

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Authorised
19,999,999 Ordinary ‘A’ Shares of a nominal value of €1 each	19,999,999	19,999,999	19,999,999	19,999,999
1 Ordinary ‘B’ Shares of a nominal value of €1 each	1	1	1	1
	20,000,000	20,000,000	20,000,000	20,000,000
Issued and fully paid up
10,951,389 Ordinary ‘A’ Shares of a nominal value of €1 each	10,951,389	10,951,389	10,951,389	10,951,389
8,114,837 Ordinary ‘A’ Shares of nominal value of €1 each	8,114,837	-	8,114,837	-
1 Ordinary ‘B’ Share of a nominal value of €1 each	1	1	1	1
	19,066,227	10,951,390	19,066,227	10,951,390
	10,951,389

Issue of Ordinary Shares

On the 22nd December 2022, the general meeting of shareholders approved the issue of 10,948,390 ordinary ‘A’ shares of nominal value of €1 each.

On the 14th April 2023, the general meeting of shareholders approved the issue of 7,914,837 ordinary ‘A’ shares of nominal value of €1 each.

On the 17th of May 2023, the general meeting of shareholders approved the issue of 200,000 Ordinary ‘A’ shares of nominal value of €1 each.

21Other equity

The Other Equity of €17,970 related to the loss arising from the acquisition of the subsidiaries within the Group.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

22Earnings per share

Earnings per share is calculated by dividing the result attributable to owners of the Company by the weighted average number of ordinary shares in issue during the year/period.

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Profit for the year/period	4,342,547	1,226	3,276,708	649
Weighted average share in issue	16,687,357	915,116	16,687,357	915,116
Earnings per share	0.26	-	0.20	-

The company has not issued any dilutive instruments in the past, and therefore the basic and diluted earnings per share are equal.

23Borrowings

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Short term – falling due within one year
Bank loans	2,827,886	8,000,000	-	8,000,000
Total short term borrowings	2,827,886	8,000,000	-	8,000,000

		Group	Company
	2023	2022	2023	2022
	€	€	€	€
Long term – falling due after one year
Bank loans	6,887,875	6,063,777	-	-
Total long term borrowings	6,887,875	6,063,777	-	-

As at 31st December 2023, one of the subsidiaries had a bank loan of €4,748,151 (2022: €3,263,777) which was granted to end-finance the acquisition and the development of the two Marsascala projects. The interest rate is at 3.75% per annum. Repayments are to be made from proceeds from the sale of property of Muscat Holdings (II) Limited as laid out in the repayment terms in the sanction letter. The loans are guaranteed by Muscat Holdings (II) Limited and its shareholders, which have bound themselves jointly and severally liable for the repayment of the loan and the interest thereon, pursuant and subject to the terms and conditions in the sanction letter.

As at 31st December 2023, another subsidiary had a bank loan €4,967,610(2022: €2,800,000) which was taken to part-finance the development of the hotel. The interest rate is at 4% per annum. Repayments are to be made over 15 years by monthly instalments as laid out in the repayment terms in the sanction letter. The loans are guaranteed by Muscat Holdings Limited and JUEL Holdings Limited, which have bound themselves jointly and severally liable for the repayment of the loan and the interest thereon, pursuant and subject to the terms and conditions in the sanction letter.

As at 31st December 2022, the parent company had a bank loan of €8,000,000 which was granted to inject funds in one of the subsidiaries to finance the acquisition of part of the property of the hotel. The interest rate was at 4% per annum. The loan was repaid during 2023 out of the proceeds of the Bond.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

23Borrowings – continued

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Debt securities in issue
Face value
5.5% Secured Bonds 2035	32,000,000	-	32,000,000	-
	32,000,000	-	32,000,000	-

The effective interest rates at the end of the year were as follows:

Face value
	2023	2022	2023	2022
	€	€	€	€
Secured Bonds 2035	5.5%	-	5.5%	-

The bonds are measured at the amount of net proceeds adjusted for the amortisation of the difference between the net proceeds and the redemption value of such bonds, using effective yield method. The bond costs were endorsed by the subsidiaries and will be amortised accordingly in the subsidiary.

On 27th June 2023, JUEL Group plc issued up to €32,000,000 5.5% Secured Bonds 2035. The bond interest is payable annually in arrears on 27th June. The bonds have been admitted to the Stock exchange on 4th July 2023. The quoted market price as at 31st December 2023 for the bonds was €102.

The 5.5% Secured Bonds 2035 are redeemable at par on 27 June 2035. The bond is secured for the full nominal value of the Secured Bond interests thereon as follows:

(i)The first-ranking general hypothec for the amount is €32 million, over all the present and future property of the Issuer;

(ii)The first-ranking general hypothec for the amount of €32 million, over all the present and future property of Juel Hospitality Limited;

(iii)The first-ranking special hypothec granted by Juel Hospitality Limited for the amount of €32 million over the Hotel site (and any developments and constructions thereon).

In addition there are joint and several guarantees granted by Juel Holdings Limited, Juel Hospitality Limited, Muscat Holdings Limited and Muscat Holdings (II) Limited.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

24Bond advance facility

The Bond Advance facility at the end of the prior year was as follows:

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Bond advanced facility	-	9,487,843	-	9,487,843

The Company had a bond advance facility of €9,487,843 in 2023 to refinance part of its current debt facilities and other future requirements. The bond advance facility was paid in July 2023.

25Trade and other payables

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Trade and other payables
Trade payables	136,295	468,716	-	-
Advanced deposits received on promise of sale agreements	150,377	-	-	-
Other payables	1,147,221	1,297,174	-	-
Social security and other FSS tax	175	-	-	-
Other taxation	14,766	-	-	-
Accruals	1,556,014	104,811	959,736	96,611
	3,004,848	1,870,701	959,736	96,611
Other Financial liabilities
Amounts due to shareholders	375,289	15,749	750	315
Amounts due to subsidiaries	-	2,850,579	-	5,000
Amounts due to related parties	1,644,428	-	1,644,428	-
	2,019,717	2,866,328	1,645,178	5,315

Total trade and other creditors

5,024,565

4,737,029

2,604,914

101,926

The amounts due to the shareholders, subsidiaries and related parties are interest free and repayable on demand.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

26Transactions with related parties

Group

In the normal course of business, the Group enters into various transactions with related parties. Related parties are defined as those that have an ability to control or exercise significant influence over the other party In making financial and operational decisions. These include directors and shareholders who hold a substantial amount of the votes able to cast at general meetings.

Company

All companies forming part of JUEL Group, ACMUS Group Limited and GAP Group Investments (II) Limited are considered by the directors to be related parties.

During the course of the year/period, the Company and the Group entered into transactions with related undertakings all of which arise in the ordinary course of business. The related party transactions were :

	Group		Company
	2023	2022	2023	2022
	€	€	€	€
Other financial assets
Amount receivable from Juel Hospitality Limited - Maturity date 2035	-	-	24,408,601	17,591,867

Trade and other receivables
Amounts due from shareholders	-	773,973	-	-
Amounts due from subsidiaries	-	-	2,102,363	-
Amounts due from related parties	1,644,428	-	1,644,428	-
Other financial liabilities
Amounts due to shareholder	375,289	15,749	750	315
Amounts due to subsidiaries	-	2,850,579	-	5,000
Amounts due to related parties	1,644,428	-	1,644,428	-

Key management personnel compensation consists of directors renumeration as disclosed in note 7 to the financial statements.

27Statutory information

JUEL Group p.l.c. is a public limited company and is incorporated in Malta, with its registered address at Avian Hill, Triq L- Ispanjulett C/W Triq Il- Gallina, Kappara, San Gwann.

JUEL GROUP P.L.C.

Annual Report and Consolidated Financial Statements for the year ended 31st December 2023

__________________________________________________________________________________

NOTES TO THE FINANCIAL STATEMENTS – 31ST DECEMBER 2023

28Capital Commitments

As at 31 December 2023, the Group had 2 promise of sale agreements from the Portoscala project. No deposits were paid on these promise of sales, however these agreements will generate sales amounting to €440,000 in 2024, together with other Promise of sale agreements being signed in 2024.

29Post Balance Sheet Events

On the 6 February 2024, the Company announced that it applied to MFSA requesting authorisation for the issue of a maximum of €5,000,000 unsecured notes redeemable between 2027 and 2029.

_________________________________________________________________________________

Independent auditor's report

To the Shareholders of Juel Group p.l.c.

Report on the Annual Report and Consolidated Financial Statements for the year ended 31st December 2023.

Opinion

I have audited the parent Company financial statements and the consolidated financial statements (the “financial statements”) of Juel Group plc (the “Company”) and its subsidiaries together (the “Group”), set on pages 12 to 53 which comprise the Statement of Financial Position as at 31st December 2023 and the Statement of Profit or Loss, Statement of Changes in Equity and Statement of Cash Flows for the year then ended, and notes to the consolidated financial statements including a Summary of material accounting policies.

In my opinion, the accompanying financial statements give a true and fair view of the financial position of Juel Group p.l.c. and its Group as at 31st December 2023, and of the Company’s and its Group’s financial performance and their cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the EU and have been properly prepared in accordance with the requirements of the Companies Act (Cap. 386).

Basis for Opinion

I conducted my audit in accordance with International Standards on Auditing (ISAs). My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of my report. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Independence

I am independent of the Company and the Group in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) together with the ethical requirements that are relevant to my audit of the financial statements in accordance with the Accountancy Profession (Code of Ethics for Warrant Holders) Directive issued in terms of the Accountancy Profession Act (Cap.281) in Malta, and I have fulfilled my other ethical responsibilities in accordance with these requirements and the IESBA Code.

My audit approach

Overview

•Overall materiality - €730,055 (1% of the consolidated total assets)

Key audit matters

•Valuation of Inventory

•Valuation of Property, Plant and Equipment

•Valuation of Investment Property

Scope and timing of the Group audit engagement

As part of designing my audit, I determined materiality and assessed the risks of material misstatement in the financial statements. In particular, I 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.

_________________________________________________________________________________

Independent auditor's report

the

Shareholders

Juel Group p.l.c.

I also addressed the risk of management override of internal controls, including among other matters consideration of whether there was evidence of bias that represent a risk of material misstatement due to fraud, and the industry in which the Company and the Group operates.

I tailored the scope of my audit in order to perform sufficient work to enable me to provide an opinion on the financial statements as a whole, taking into account the structure of the Company and the Group, the accounting processes and controls, and the industry in which the Company and the Group operates.

Levels of materiality and methodology used for the group audit engagement

The scope of my audit was influenced by my 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 reasonable be expected to influence the economic decisions of the users taken on the basis of the financial statements.

Based on my professional judgement, I determined certain quantitative thresholds for materiality, including the overall materiality for the financial statements as a whole. These, together with qualitative considerations, helped me to determine the scope of my audit and the nature, timing and extent of my audit procedures and to evaluate the effect of misstatements, both individual and in aggregate of the financial statements as a whole.

The overall Group materiality amounted to €730,055 which represents 1% of the Total Assets. I chose Total Assets as the accepted point of reference to the users of the financial statements as it is most commonly used. I chose 1% as it is within the range of acceptable quantitative materiality thresholds in auditing standards.

I agreed with the Audit Committee that I would report to them misstatements identified during my audit above €730,055 as well as misstatements below that amount that, in my view, warranted reporting for qualitative reasons.

Key Audit Matters

Key audit matters are those matters that, in my professional judgment, were of most significance in my audit of the financial statements for the current period. These matters are addressed in the context of my audit of the financial statements as a whole, and in forming my opinion thereon, and I do not provide a separate opinion on these matters.

The key audit matters identified were:

Valuation of inventory

The Group consists of companies holding immovable property for development and resale. At 31st December 2023, the carrying amount of immovable property held by the Group as inventory represented 12% of total assets.

The carrying value of inventories as at 31st December 2023 is explained in note 17, which discloses the composition of the Inventories. At year end, the directors assess whether inventory is carried at the lower of cost and net realisable value.

Inventory valuation has been identified as a key audit matter because of the significance of the carrying value of inventories in the Group’s Statement of Financial Position and the judgmental nature of the assumptions used by the directors in the assessment described above.

_________________________________________________________________________________

Independent auditor's report

the

Shareholders

Juel Group p.l.c.

Valuation of inventory – continued

My audit procedures included:

•Audit procedures carried out to verify cost included testing over source documentation, including vouching costs incurred to date, a review of labour costs and a re-calculation of borrowing costs.

•I also evaluated the appropriateness as audit evidence of the valuation carried out by an independent valuer.

•I evaluated the adequacy of related disclosures in the financial statements.

Based on my audit work, I concluded that the inventories were fairly stated.

Valuation of property, plant and equipment

The Group also owns property which is held by one of the subsidiaries, for the operations of a hotel. Bonds were issued to the public to enable the Company to finance the development of the hotel. At 31st December 2023, the carrying amount of this property amounted to 37% of total assets.

My audit procedures included:

•Audit procedures carried out to verify cost included testing over source documentation, including vouching costs incurred to date, a review of labour costs and a re-calculation of borrowing costs.

•I also evaluated the appropriateness as audit evidence of the valuation carried out by an independent valuer.

•I evaluated the adequacy of related disclosures in the financial statements.

Based on my audit work, I concluded that the property, plant and equipment were fairly stated.

Valuation of Investment Property

The Group also has subsidiaries within the Group that hold properties that are used for commercial use. At 31st December 2023, the carrying amount of the Investment held by the Group amounted to 16% of total assets.

My audit procedures included obtaining valuation reports obtained from third party qualified valuers for all of the Group’s properties.

The valuation reports by the third party valuers are based on both:

•Information provided by the Group

•Assumptions and valuation models used by the valuers, with assumptions being typically market related and based on professional judgement and market observation

The valuation of the Group’s property portfolio is inherently subjective due to, among other factors, the individual nature of each property, its location and the expected future returns.

_________________________________________________________________________________

Independent auditor's report

the

Shareholders

Juel Group p.l.c.

The existence of significant estimation uncertainty evidenced by the sensitivity of the property valuations to possible shifts in key assumptions as described in Note 12.3 could result in material misstatement, and therefore I have devoted specific audit focus and attention to this area.

My audit procedures in relation to the valuation of the properties include:

•Reviewing the methodologies used by the external valuers and by management to estimate the fair value for all properties. I confirmed that the valuation approach for each property was suitable for use in determining the carrying value of properties as at 31 December 2023.

•Testing the mathematical accuracy of the calculations derived from each model.

•Considering the appropriateness of the fair values estimated by the external valuers based on my knowledge of the industry and challenged the work performed and assumptions used by the valuers.

•Considering the potential impact of reasonably possible changes in the key assumptions underlying the valuations, I challenged the Company’s valuations to assess whether they fell within a reasonable range of the expectations developed.

•Management was able to provide explanations and refer to appropriate supporting evidence. I have also assessed the appropriateness of disclosures in this respect.

Other information

The directors are responsible for the other information. The other information comprises the Directors’ Report, the Statement of Compliance with the Principles of Good Corporate Governance and the Statement of the Directors’ Responsibilities, but does not include the financial statements and my auditor’s report thereon.

My opinion on the financial statements does not cover the other information and I do not express any form of assurance conclusion thereon.

In connection with my audit of the financial statements, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements, or my knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on the work I have performed, I conclude that there is a material misstatement of this other information, I am required to report that fact. I 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 and fair presentation of the financial statements in accordance with IFRSs as adopted by the EU, 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 Company’s and the Group’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 Company or to cease operations, or have no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Company’s and the Group’s financial reporting process.

_________________________________________________________________________________

Independent auditor's report

the

Shareholders

Juel Group p.l.c.

Auditor’s Responsibilities for the Audit of the Financial Statements

My 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 my 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, I exercise professional judgment and maintain professional scepticism throughout the audit. I 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 my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

•Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s and the Group’s internal control.

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

•Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s and the Group’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor's report. However, because not all future events or conditions can be predicted, this statement is not a guarantee as to the Company’s and Group’s ability to continue as a going concern and future events or conditions may cause the Company and the Group to cease to continue as a going concern. In particular, it is difficult to evaluate all of the potential implications resulting from the conflict in Ukraine and the aftermath of the Covid-19 pandemic.

•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. I am responsible for the direction, supervision and performance of the Group audit. I remain solely responsible for my audit opinion.

I 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 I identify during my audit.

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Auditor’s Responsibilities for the Audit of the Financial Statements – continued

I also provide those charged with governance with a statement that I 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 my independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, I determined those matters that are of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. I describe these matters in my auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, I determine that a matter should not be communicated in my 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

I 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 Juel Group p.l.c. for the year ended 31 December 2023, 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 financial statements, by reference to the Listing Rules Rule 5.56A, in accordance with the requirements of the ESEF RTS.

My responsibilities

My responsibility is to obtain reasonable assurance about whether the Annual Financial Report, including the financial statements, complies in all material respects with the ESEF RTS based on the evidence I have obtained. I conducted my reasonable assurance engagement in accordance with the requirements of ESEF Directive 6.

My 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.

I believe that the evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Opinion

In my opinion, the Annual Financial Report for the year ended 31 December 2023 has been prepared in accordance with the ESEF RTS in all material aspects.

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Report on Other Legal and Regulatory Requirements – continued

Report on Directors’ Report

With respect to the Directors’ Report, I also considered whether the Directors’ Report includes the disclosure requirements of Article 177 of the Companies Act (Cap. 386). Pursuant to listing Rule 5.62 of the Listing Rules issued by the Listing Authority in Malta, I am required to review the directors' statement in relation to going concern.

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

•The information given in the Directors’ Report for the financial year for which the financial statements are prepared is consistent with the financial statements;

•The Directors’ Report has been prepared in accordance with applicable legal requirements.

I have nothing to report in relation to the statement on going concern.

In the light of the knowledge and understanding of the Company and the Group and their environment obtained in the course of the audit, I have not identified any material misstatements in the Directors’ Report and other information that I obtained prior to the date of the auditor's report. I have nothing to report in this regard.

Report on Corporate Governance – Statement of Compliance

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

My responsibility is laid down by Listing Rule 5.98, which requires the auditor to include a report to shareholders on the Corporate Governance Statement in the Company’s and the Group’s Annual Financial Report.

I read the Statement of Compliance and consider the implications for my report if I become aware of any apparent misstatements or material inconsistencies with the financial statements included in the Annual Report. My responsibilities do not extend to considering whether this Statement is consistent with any other information included in the Annual Report.

I am not required to, and I 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 and the Group’s corporate governance procedures, or its risk and control procedures.

In my opinion, the Statement of Compliance set out on pages 7 to 11 has been properly prepared in accordance with the requirements of Listing Rules issued by the Malta Listing Authority.

Consistency of the Audit Report with the Additional Report to the Audit Committee

My opinion on the audit of the financial statements is consistent with the additional report to the audit committee.

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Report on Other Legal and Regulatory Requirements – continued

Declaration on prohibited non-audited services

To the best of my knowledge and belief, I have not provided any non-audit services that are prohibited under Article 18A of the Accountancy Profession Act (Cap. 281) and under Article 5(1) of the EU Audit Regulation No. 537/2014. During the period from 1 January 2023 to 31 December 2023, I provided the services disclosed in Note 5 to the financial statements in addition to the statutory audit.

Report on Other matters which I am required to report by exception

I am also responsible under the Companies Act (Cap. 386), to report to you if, in my opinion:

•Adequate accounting records have not been kept, or that returns adequate for my audit have not been received by branches visited by me.

•The financial statements are not in agreement with the accounting records and returns.

•I have not received all the information and explanations I require for my audit.

•The information given in the Report of the Directors is not consistent with the financial statements.

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

Appointment

I was first appointed as auditor of the Listed Company on 6 April 2023 for the financial year ending 31st December 2023. This is my first year of appointment. The Company was listed on a regulated market on 4 July 2023.

This copy of the audit report has been signed by

Pamela Fenech (Director) for and on behalf of

TACS Malta Limited

Certified Public Accountant

Registered Auditor

1, Tal-Providenza Mansions,

Main Street,

Balzan,

Malta

Date: 29th April 2024