Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1.
FOR
THE
YEAR
ENDED
31st
DECEMBER
2
0
2
1
The
directors
present
their
annual
report
and
the
audited
parent
company
financial
statements
together
with
the
group’s
consolidated
financial
statements
(the
“financial
statements”)
of
Gap
Group
p.l.c.
for
the
year
ended
31st
December
2021.
Principal
A
c
t
i
v
i
t
i
e
s
The
principal
activity
of
Gap
Group
p.l.c.
is
to
hold
investments
in
subsidiary
companies
and
to
raise
financial
resources
from
the
capital
markets
to
finance
its
investments
and
the
property
development
projects
of
its
subsidiaries.
The
principal
activity
of
the
Group
is
to
acquire,
develop
and
dispose
of
immovable
property
and
to
construct,
develop
and
enter
into
arrangements
with
contractors
and
other
service
providers
in
connection
with
its
properties.
The
directors
do
not
envisage any
changes to the company’s and group’s principal activities in the foreseeable future.
Review
of
b
u
s
i
n
e
s
s
Works
on
the
developments
progressed
well
and
within
the
scheduled
time
frames.
The
Group
continued
to
sign
new
preliminary
agreements
at
a
steady
pace
whilst
a
record
number
of
contracts
from
its
various
projects
were
signed
during
the financial year under review.
S
o
u
t
h
r
i
d
g
e
The Southridge development in Mellieha was fully complete during 2020.
Out of the 159 residential units, 152 units
have been sold
(contracted) and a further 6 units were subject to
a Preliminary
Agreement as at 31st December 2021.
This
means
that
99%
of
the
residential
units
were
committed,
out
of
which
96%
have
been
contracted
as
at
31st
December 2021.
F
a
i
r
w
i
n
d
s
The
Fairwinds
development
in
Hal
Luqa
consists
of
21
blocks.
By
the
end
of
the
year,
all
the
blocks
were
fully
complete.
At
the
end
of
the
year,
out
of
the
268
residential
units,
213
units
have
been
sold
(contracted)
and
a
further
48
units
were
subject to a Preliminary Agreement.
This
means
that
97%
of
the
residential
units
were
committed,
out
of
which
79%
have
been
contracted
as
at
the
end
of
the year.
W
a
t
e
r
b
a
n
k
The
Waterbank
development
in
Marsascala
development
consists
of
63
residential
units.
By
the
end
of
the
year,
the
project
was
fully
complete.
At
the
end
of
the
year,
out
of
the
63
residential
units,
23
units
have
been
sold
(contracted)
and a further 23 units were subject to a Preliminary Agreement.
This
means
that
83%
of
the
residential
units
were
committed,
out
of
which
37%
have
been
contracted
as
at
31
December
2021.
The
H
a
z
e
l
The
Hazel
development
in
Birkirkara
consists
of
14
residential
units.
By
the
end
of
the
year,
the
project
was
fully
complete.
At
the
end
of
the
year,
out
of
the
14
residential
units,
8
units
have
been
sold
(contracted)
and
a
further
3
units
were subject to a Preliminary Agreement.
This
means
that
79%
of
the
residential
units
were
committed,
out
of
which
57%
have
been
contracted
by
the
end
of
the
y
e
a
r
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2.
Directors'
report
-
c
o
n
t
i
n
u
e
d
D
u
m
o
n
t
The
Dumont
development
in
San
Pawl
tat-Targa
consists
of
9
residential
units.
By
the
end
of
the
year,
the
project
was
fully
complete.
At
the
end
of
the
year,
out
of
the
9
residential
units,
1
unit
has
been
sold
(contracted)
and
a
further
7
units were subject to a Preliminary Agreement.
This
means
that
88%
of
the
residential
units
were
committed,
out
of
which
11%
have
been
contracted
by
the
end
of
the
y
e
a
r
.
Mulberry
P
a
r
k
Works on the Mulberry Park
in Qawra started in December
2020 and progressed at a steady pace.
The project
will
consist of 93 residential units and is expected to be fully complete in Q4 2022.
As at 31 December 2021, construction was 80% complete and finishing works were 20% complete.
The project was
launched in December 2021 and by the end of the year the company has signed 5 Preliminary agreements.
The
P
a
n
t
h
e
o
n
Works
on
The
Pantheon
development
in
Mosta
started
in
December
2020
and
progressed
at
a
steady
pace.
The
project will consist in about 100 residential units and is expected to be fully complete in Q2 2023.
As at 31 December 2021 construction was 28% complete and finishing works were about to commence.
The project
was
launched on the market in April 2022.
Bonds
in
i
s
s
u
e
At
the
end
of
the
year,
the
company had
three
bonds
in
issue,
namely the
GAP
Group
p.l.c.
3.65%
Secured
Bonds
2022, the GAP Group p.l.c. 4.25% Secured Bonds 2023 and the GAP Group p.l.c. 3.7% Secured Bonds 2023 - 2025.
As at 31 December 2021 the aggregate amount of bonds in issue amounted to €69,001,852 being €29,056,845 GAP
Group
p.l.c. 3.65% Secured Bonds
2022, €19,247,300 Gap Group p.l.c. 4.25% Secured Bonds
2023 and €20,697,707
Gap Group p.l.c. 3.7% Secured Bonds 2023 – 2025.
R
e
s
e
r
v
e
A
c
c
o
u
n
t
Pursuant
to
the
bond
prospectus
of
the
4.25%
Secured
Bonds
2023,
the
3.65%
Secured
Bonds
2022
and
the
3.7%
Secured
Bonds
2023
-
2025,
a
reserve
account
had
been
created
by
the
Security
Trustee
to
cover
for
the
redemption
of
the
three
bonds.
All
sales
of
units
forming
part
of
the
hypothecated
property
in
favour
of
the
bond
issue
shall
be
made
on
condition
that
these
units
are
freed
from
hypothecary
rights
and
privileges
against
an
agreed
amount
from
the
sale
proceeds being deposited in the said Reserve Accounts.
By
31
December
2021,
the
Reserve
Account
of
the
4.25%
Secured
Bonds
2023
carried
a
balance
of
€19,091,010
(i.e.
99%
of
the
total
bond
repayment)
and
the
Reserve
Account
of
the
3.65%
Secured
Bonds
2022
carried
a
balance
o
f
€25,300,765
(i.e.
87%
of
the
total
bond
r
e
p
a
y
m
e
n
t
)
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
.
Directors'
report
-
c
o
n
t
i
n
u
e
d
Principal
risks
and
u
n
c
e
r
t
a
i
n
t
i
e
s
Although
the
development
works
of
the
afore-mentioned
projects
and
the
securing
of
new
sales
by
way
of
preliminary
agreements
are
progressing
as
planned,
the
company
is
still
subject
to
several
financial
risk
factors
including
the
market,
economic,
counter-party,
credit
and
liquidity
risks
amongst
others
that
may
affect
the
projects
and
their
timely
completion.
Additionally,
the
directors
are
monitoring
closely
inflationary
risks
resulting
from
the
conflict
in
Ukraine
and
the
aftermath
of
the
COVID
pandemic.
The
directors
are
confident
that
the
company
has
robust
measures
in
place
to
mitigate
the
likely
possible
effects
of
inflationary
pressures.
Where
possible,
the
board
provides
principles
for
the
overall
risk
management as well as policies to mitigate these risks in the most prudent way.
Events
subsequent
to
the
reporting
p
e
r
i
o
d
On
6
December
2021,
the
Company
has
received
regulatory
approval
for
the
issue
of
up
to
€21,000,000
GAP
Group
plc
3.9%
Secured
Bonds
2024
–
2026.
Applications
opened
on
9
December
2021
and
closed
on
7
Jan
2022.
In
terms
of
the
Prospectus,
the
company
reserved
up
to
€19,247,300
for
the
holders
of
the
4.25%
GAP
Group
plc
Secured
Bonds
2023.
The
company
received
applications
amounting
to
€10,831,900
from
the
holders
of
the
4.25%
GAP
Group
plc
Secured
Bonds
2023.
The
remaining
balance
of
€10,168,100
was
allocated
to
holders
of
the
4.25%
GAP
Group
plc
Secured Bonds 2023 in respect of any
excess bonds applied for and to Authorised Financial Intermediaries.
Subsequently,
following
the
allocation
of
the
€21,000,000
GAP
Group
plc
3.9%
Secured
Bonds
2024
–
2026,
the
outstanding value of the 4.25% GAP Group plc Secured Bonds 2023 has been reduced to €8,415,400.
Results
and
d
i
v
i
d
e
n
d
s
The
results
for
the
year
ended
31st
December
2021
are
shown
in
the
income
statement
on
Page
9.
The
Group
registered
a
Profit
of
€8,941,239
(2020
-
Profit
of
€3,978,964),
while
the
Company
registered
a
Profit
of
€3,373,926
(2020
-
Profit
of
€24,126).
The
group
issued
an
interim
dividend
of
€2,500,000
from
the
final
tax
account
during
the
current
year.
The
net
dividend
per share amounted to €1 per share.
The Directors do not recommend the payment of a final dividend.
D
i
r
e
c
t
o
r
s
The
directors
of
the
Company
who
held
office
during
the
year
were:
George Muscat (Chairperson)
Paul
Attard
(Executive
Director
and
Company
Secretary)
Adrian Muscat (Executive Director)
Francis
Gouder
(Non-Executive
Director)
Mark Castillo (Non-Executive Director)
Dr Chris Cilia (Non-Executive Director)
The
Company’s
Articles
of
Association
do
not
require
any
directors
to
r
e
t
i
r
e
.
Company secretary
The
Company's
Secretary
is
Mr
Paul
A
t
t
a
r
d
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
4
.
Statement
of
Directors’
r
e
s
p
o
n
s
i
b
i
l
i
t
i
e
s
The
directors
are
required
by
the
Companies
Act
(Chap.
386)
to
prepare
financial
statements
in
accordance
with
International
Financial
Reporting
Standards
as
adopted
by
the
EU
which
give
a
true
and
fair
view
of
the
state
of
affairs
of
the
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
International
Financial
Reporting Standards as adopted by the European Union;
•
adopt
the
going
concern
basis
unless
it
is
inappropriate
to
presume
that
the
company
will
continue
in
b
u
s
i
n
e
s
s
;
•
make
judgements
and
estimates
that
are
reasonable
and
p
r
u
d
e
n
t
;
•
account
for
income
and
charges
relating
to
the
accounting
period
on
the
accruals
b
a
s
i
s
;
•
report
comparative
figures
corresponding
to
those
of
the
preceding
accounting
p
e
r
i
o
d
.
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
the
group
and
which
enable
the
directors
to
ensure
that
the
financial
statements
comply
with
the
Companies
Act
(Chap.
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
GAP
Group
p.l.c
for
the
year
ending
31
December
2021
are
made
available
on
the
company’s
website.
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
on
the
Company’s
website
is
available
in
other
countries
and
jurisdictions,
where
legislation
governing the preparation and dissemination of financial statements may differ from requirements or
practice in Malta.
Statement
by
the
Directors
pursuant
to
Listing
Rule
5.6
8
The
directors
declare
that
to
the
best
of
their
knowledge,
the
financial
statements
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.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
5
.
Directors'
report
-
c
o
n
t
i
n
u
e
d
Going
Concern
statement
pursuant
to
Listing
Rule
5.6
2
The
directors,
at
the
time
of
approving
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.
A
u
d
i
t
o
r
TACS
Malta
Limited
have
expressed
their
willingness
to
continue
in
office
and
a
resolution
proposing
their
reappointment
will be put before the members at the next annual general meeting.
Signed
on
behalf
of
the
Board
of
Directors
on
25
April
2022
by
Mr.
George
Muscat
(Chairman)
and
Mr.
Paul
Attard
(Director)
as
per
the
Directors’
Declaration
on
ESEF
Annual
Financial
Report
submitted
in
conjunction
with
the
Annual
Financial Report.
R
e
g
i
s
t
e
r
e
d
o
f
f
i
c
e
:
Gap
Holdings
Head
Office,
Censu Scerri Street,
T
i
g
n
e
,
Sliema
Slm
3060
Date
:
25
April
2
0
2
2
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
6
.
1.
I
n
t
r
o
d
u
c
t
i
o
n
Pursuant
to
the
requirements
of
the
Listing
Rules
issued
by
the
Listing
Authority
of
the
Malta
Financial
Services
Authority,
GAP
Group
p.l.c.
hereby
reports
on
the
extent
to
which
the
company
has
adopted
the
“Code
of
Principles
of
Good
Corporate
Governance”
(the
“Code”)
appended
to
Chapter
5
of
the
Listing
rules
as
well
as
the
measures
adopted
to
ensure compliance with these same principles.
GAP
Group
p.l.c.
acts
as
a
finance
company
to
the
Group
and
as
such
has
minimal
operations.
Its
primary
function
is
the
lending
and
monitoring
of
the
proceeds
of
the
public
bond
to
the
Group.
GAP
Group
p.l.c.
has
no
employees
other
than the directors and the company secretary.
2.
Compliance
with
the
C
o
d
e
The
Board
of
Directors
of
GAP
Group
p.l.c.
(The
Company)
believe
in
the
adoption
of
the
Code
and
has
endorsed
it
except
where
the
size
and/or
circumstances
of
the
company
are
deemed
by
the
Board
not
to
warrant
the
implementation
of specific recommendations.
Additionally,
the
Board
recognises
that,
by
virtue
of
Listing
Rule
5.101,
the
company
is
exempt
from
making
available
the information required in terms of Listing Rules 5.97.1 to 5.97.3, 5.97.6 to 5.97.8.
Moreover,
the
Board
also
acknowledges
that
the
requirements
emanating
from
Directive
2014/95/EU
as
published
in
Circular
05/16
–
Transposition
of
Directive
2014/95/EU
do
not
apply
to
the
company
since
it
does
not
classify
as
a
‘large
company’ under the definition of the Directive.
3.
The
Board
of
D
i
r
e
c
t
o
r
s
The
board
of
directors
is
responsible
for
the
Company’s
affairs,
for
the
overall
direction
of
the
company
and
being
dynamically involved in supervising the systems of control and financial reporting.
The
Board
meets
at
least
four
times
annually
and
is
currently
composed
of
six
members,
three
of
whom
are
independent
from the Company or related parties.
As
at
date
of
this
statement,
the
Board
of
Directors
is
composed
as
f
o
l
l
o
w
s
:
George
Muscat
(Chairperson
)
Paul
Attard
(Executive
Director
and
Company
Secretary)
Adrian Muscat (Executive Director)
Francis
Gouder
(Non-Executive
Director)
Mark Castillo (Non-Executive Director)
Dr Chris Cilia (Non-Executive Director)
There
is
no
CEO
role
required
in
the
Company
due
to
the
nature
of the
Company
and
as such
the
board
carries out
the
policy decisions regarding the Company.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
7
.
Corporate
governance
-
Statement
of
compliance
(
C
o
n
t
i
n
u
e
d
)
4.
C
o
m
m
i
t
t
e
e
s
i.
Audit
C
o
m
m
i
t
t
e
e
In
accordance
with
the
Listing
Rules,
GAP
Group
p.l.c.
has
established
an
Audit
Committee,
which
terms
of
reference
are
based
on
the
principles
set
out
by
the
said
Listing
Rules.
The
Audit
Committee
is
entirely
composed
of
independent,
non-executive
directors.
At
present,
Francis
X.
Gouder
acts
as
chairperson,
whilst
Mark
Castillo
and
Dr
Chris
Cilia
LLD
act
as
members.
In
compliance
with
the
Listing
Rules,
Francis
X.
Gouder
is
the
independent
Non-
Executive
Director
who
is
competent
in
accounting
and
auditing
matters
having
previously
served
in
various
senior
positions
in
several
financial institutions.
The
committee’s
primary
object
is
to
assist
the
board
in
fulfilling
its
supervisor
and
monitoring
responsibility
by
reviewing
the
company’s
financial
statements
and
disclosures,
monitoring
the
system
of
internal
control
established
by
management
as
well
as
the
audit
process.
The
audit
committee
formally
convened
four
times
during
the
financial
period
ending 31st December 2021.
ii.
Remuneration
and
Nomination
C
o
m
m
i
t
t
e
e
s
Under
present
circumstances,
the
board
does
not
consider
it
necessary
to
appoint
a
remuneration
committee
and
a
nomination committee as decisions on these matters are taken at shareholder level and by the board itself.
iii.
Evaluation
of
the
board’s
p
e
r
f
o
r
m
a
n
c
e
Under
present
circumstances,
the
board
does
not
consider
it
necessary
to
appoint
a
committee
to
carry
out
a
performance
evaluation
of
its
role
as
the
board’s
performance
is
constantly
under
the
scrutiny
of
the
shareholders
of
the
company.
5.
R
e
m
u
n
e
r
a
t
i
o
n
S
t
a
t
e
m
e
n
t
In
terms
of
Rule
8.A.4
of
the
Code
of
Principles
of
Good
Corporate
Governance
contained
in
Appendix
5.1
of
the
Listing
Rules
of
the
Listing
Authority
(the
“Code”),
the
Company
is
to
include
a
remuneration
statement
in
its
annual
report
which
should
include
details
of
the
remuneration
policy
of
the
Company
in
respect
of
the
financial
packages
of
members
of the Board of Directors of the Company.
The
remuneration
payable
to
directors
of
the
Company
consists
of
fixed
remuneration
only.
No
part
of
the
remuneration
paid
to
the
directors
is
performance-based
and
none
of
the
directors
(in
their
capacity
as
directors
of
the
Company)
are
entitled
to
profit-sharing,
share
options
or
pension
benefits.
The
directors
do
not
receive
any
form
of
monetary
or
non-
monetary
perks
or
benefits.
There
were
no
changes
to
this
policy
from
the
previous
year
and
the
Company
does
not
intend to change the policy in the foreseeable future.
Remuneration
paid
to
the
Directors
by
the
subsidiaries
of
the
Company
for
the
period
from
1st
January
2021
to
31st
December 2021 amounted to €185,924 (2020 - €155,744).
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
8
.
Corporate
governance
-
Statement
of
compliance
(
C
o
n
t
i
n
u
e
d
)
6.
Internal
C
o
n
t
r
o
l
While
the
Board
is
ultimately
responsible
for
the
company’s
internal
controls
as
well
as
their
effectiveness,
authority
to
operate
the
company
is
delegated
to
the
Executive
Directors.
The
company’s
system
of
internal
controls
has
been
drawn
up
through
the
Internal
Control
Manual
to
manage
risks
in
the
most
appropriate
manner.
Procedures
are
in
place
for
the
Company
to
control,
monitor
and
assess
risks
and
their
implications
through
ongoing
cash
flow
monitoring
reports
and strategic plans which are presented to the Executive Directors.
7.
Relations
with
the
bondholders
and
the
m
a
r
k
e
t
The
market
and
bondholders
alike
are
kept
up
to
date
with
all
relevant
information,
the
Annual
Report
and
Financial
statements,
as
well
as,
via
company
announcements
made
through
the
Malta
Stock
Exchange
and
on
the
company’s
w
e
b
s
i
t
e
.
8.
Institutional
s
h
a
r
e
h
o
l
d
e
r
s
This
principle
is
not
applicable
since
the
company
has
no
institutional
s
h
a
r
e
h
o
l
d
e
r
s
.
9.
Conflicts
of
i
n
t
e
r
e
s
t
The
directors
always
act
in
the
interest
of
the
Company
and
its
shareholders.
If
any
director
has
a
conflict
of
interest,
he
will
not
be
allowed
to
vote
on
the
matter
at
hand.
Furthermore,
the
board
of
directors
and
management
of
the
company is in compliance with the obligations towards the rules of Insider Dealing.
1
0
.
Corporate
Social
R
e
s
p
o
n
s
i
b
i
l
i
t
y
The
Group
adhered
to
accepted
principles
of
corporate
social
responsibility
in
its
day
to
day
practices
by
acting
ethically
in
the
day
to
day
management
of
the
business
and
strives
to
improve
the
quality
of life
of the
workforce
as
well as of the
society at large.
The Group also regularly supports charitable causes.
Signed
on
behalf
of
the Board
of
Directors
on
25
April 2022
by Mr.
George
Muscat
(Chairperson)
and
Mr.
Paul Attard
(
D
i
r
e
c
t
o
r
)
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
9
.
INCOME
S
T
A
T
E
M
E
N
T
FOR
THE
YEAR
ENDED
31st
DECEMBER
2
0
2
1
G
r
o
u
p
C
o
m
p
a
n
y
N
o
t
e
s
2
0
2
1
€
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
T
u
r
n
o
v
e
r
3
-
-
Cost
of
s
a
l
e
s
(
)
(
)
-
-
Gross
P
r
o
f
i
t
-
-
Administrative
e
x
p
e
n
s
e
s
(
)
(
)
(
4
9
,2
2
0
)
(
8
6
,6
8
6
)
Operating
profit
/
(
l
o
s
s
)
4
(
4
9
,2
2
0
)
(
8
6
,6
8
6
)
Finance
c
o
s
t
s
6
(
)
(
)
(
3
,4
5
4
,9
8
9
)
(
2
,6
0
5
,4
7
4
)
Investment
i
n
c
o
m
e
7
6,869,482
2,8
8
0
,7
7
3
Profit
before
t
a
x
a
t
i
o
n
3,3
6
5
,2
7
3
1
8
8
,6
1
3
Tax
e
x
p
e
n
s
e
8
(
)
(
)
(
6
7
,9
3
5
)
(
4
4
,8
2
1
)
Profit
for
the
y
e
a
r
3,2
9
7
,3
3
8
1
4
3
,7
9
2
STATEMENT
OF
COMPREHENSIVE
I
N
C
O
M
E
O
t
h
e
r
c
o
m
p
r
e
h
e
n
s
i
v
e
i
n
c
o
m
e
R
e
s
e
r
v
e
a
r
i
s
i
n
g
o
n
r
e
v
a
l
u
a
t
i
o
n
o
f
investments
and
amortised
cost
of
i
n
t
e
r
e
s
t
free
long
term loan
r
e
c
e
i
v
a
b
l
e
(
)
7
6
,5
8
8
(
1
1
9
,6
4
6
)
Other
comprehensive
income
/ (
l
o
s
s
)
for
the
y
e
a
r
(
)
7
6
,5
8
8
(
1
1
9
,6
4
6
)
Total
Comprehensive
i
n
c
o
m
e
3,3
7
3
,9
2
6
2
4
,1
2
6
Earnings
per
s
h
a
r
e
1.3
2
0.0
0
The
notes
on
pages
14
to
40
are
an
integral
part
of
these
financial
s
t
a
t
e
m
e
n
t
s
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1
0
.
STATEMENT
OF
FINANCIAL
POSITION
-
31st
DECEMBER
2
0
2
1
G
r
o
u
p
C
o
m
p
a
n
y
N
o
t
e
s
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
A
S
S
E
T
S
Non-current
a
s
s
e
t
s
Property,
plant
and
e
q
u
i
p
m
e
n
t
1
1
1
3,250
Investment
in
s
u
b
s
i
d
i
a
r
i
e
s
1
2
3
4
,3
4
3
,5
7
4
34,338,574
I
n
v
e
s
t
m
e
n
t
s
1
3
9,6
7
0
,0
0
0
6,096,900
Other
financial
a
s
s
e
t
s
1
4
8,2
1
0
,6
3
6
14,396,415
5
2
,2
2
4
,2
1
1
54,835,139
Current
a
s
s
e
t
s
Inventory
-
Development
p
r
o
j
e
c
t
1
6
-
-
Trade
and
other
r
e
c
e
i
v
a
b
l
e
s
1
7
6
4
,6
0
3
,4
0
1
41,215,658
Cash
and
bank
b
a
l
a
n
c
e
s
1
8
3
5
,5
7
4
,6
5
8
12,938,782
Income
Tax
r
e
f
u
n
d
a
b
l
e
-
-
1
0
0
,1
7
8
,0
5
9
54,154,440
Total
A
s
s
e
t
s
1
5
2
,4
0
2
,2
7
0
108,989,579
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1
1
.
STATEMENT
OF
FINANCIAL
POSITION
-
31st
DECEMBER
2021
(
c
o
n
t
i
n
u
e
d
)
G
r
o
u
p
C
o
m
p
a
n
y
N
o
t
e
s
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
EQUITY
AND
L
I
A
B
I
L
I
T
I
E
S
Capital
and
r
e
s
e
r
v
e
s
Share
c
a
p
i
t
a
l
1
9
2,5
0
0
,0
0
0
2,500,000
Subordinated
shareholders'
loan
-
Quasi
e
q
u
i
t
y
2
1
2,5
0
0
,0
0
0
2,500,000
R
e
v
a
l
u
a
t
i
o
n
r
e
s
e
r
v
e
2
2
7
4
,8
2
2
(1,766)
Retained
e
a
r
n
i
n
g
s
2
2
8
,3
2
0
(569,019)
Total
e
q
u
i
t
y
5,3
0
3
,1
4
2
4,429,215
Non-current
l
i
a
b
i
l
i
t
i
e
s
Bank
l
o
a
n
s
2
3
3,7
0
0
,0
0
0
-
Other
financial
l
i
a
b
i
l
i
t
i
e
s
2
4
-
-
Debt
securities
in
i
s
s
u
e
2
3
6
9
,0
0
1
,8
5
2
69,864,157
Total
non-current
l
i
a
b
i
l
i
t
i
e
s
7
2
,7
0
1
,8
5
2
69,864,157
Current
l
i
a
b
i
l
i
t
i
e
s
Bank
overdraft
and
l
o
a
n
s
2
3
1,0
9
0
,3
3
2
5
0
0
,0
0
0
Trade
and
other
p
a
y
a
b
l
e
s
2
4
2,7
8
5
,9
9
7
1,285,940
Other
financial
l
i
a
b
i
l
i
t
i
e
s
2
4
7
0
,4
2
1
,9
4
1
32,902,122
T
a
x
a
t
i
o
n
d
u
e
9
9
,0
0
6
8,145
Total
current
l
i
a
b
i
l
i
t
i
e
s
7
4
,3
9
7
,2
7
6
34,696,207
Total
l
i
a
b
i
l
i
t
i
e
s
1
4
7
,0
9
9
,1
2
8
104,560,364
Total
equity
and
l
i
a
b
i
l
i
t
i
e
s
1
5
2
,4
0
2
,2
7
0
108,989,579
The notes on pages 14 to 40 are an integral part of these financial statements.
The
financial
statements
were
approved
and
authorised
for
issue
by
the
Board
of
Directors
on
25
April
2022.
The
financial
statements
were
signed
on
behalf
of
the
Board
of
Directors
by
Mr.
George
Muscat
(Chairperson)
and
Mr.
Paul
Attard
(Director)
as
per
the
Directors'
Declaration
on
ESEF
Annual
Financial
Report
submitted
in
conjunction
with
the
Annual Financial Report.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1
2
.
FOR
THE
YEAR
ENDED
31st
DECEMBER
2
0
2
1
P
r
o
f
i
t
S
h
a
r
e
Quasi
R
e
v
a
l
u
a
t
i
o
n
and Loss
T
o
t
a
l
C
a
p
i
t
a
l
E
q
u
i
t
y
R
e
s
e
r
v
e
A
c
c
o
u
n
t
N
o
t
e
€
€
€
€
€
G
r
o
u
p
Balance
at 1st January 2020
Comprehensive
incomeProfit for the year Revaluation reserve
B
a
l
a
n
c
e
at
31st
December
2
0
2
0
Balance
at 1st January 2021 Comprehensive income Profit for the year Revaluation reserve
Dividends proposed and paid during the year
B
a
l
a
n
c
e
at
31st
December
2
0
2
1
C
o
m
p
a
n
y
Balance
at 1st January 2020
Comprehensive
income / (loss)Profit for the year Revaluation reserve
B
a
l
a
n
c
e
at
31st
December
2
0
2
0
Balance
at 1st January 2021 Comprehensive income Profit for the year
Revaluation
reserveDividends proposed and paid during the year
B
a
l
a
n
c
e
at
31st
December
2
0
2
1
The
notes
on
pages
14
to
40
are
an
integral
part
of
these
financial
s
t
a
t
e
m
e
n
t
s
.
1
0
2
,
5
0
0
,
0
0
0
2
,
5
0
0
,
0
0
0
1
1
7
,
8
8
0
(
7
1
2
,
8
1
0
)
4
,
4
0
5
,
0
7
0
-
-
-
2
4
,
1
4
6
2
4
,
1
4
6
2
2
-
-
(
1
1
9
,
6
4
6
)
1
1
9
,
6
4
6
-
2
,
5
0
0
,
0
0
0
2
,
5
0
0
,
0
0
0
(
1
,
7
6
6
)
(
5
6
9
,
0
1
8
)
4
,
4
2
9
,
2
1
6
2
,
5
0
0
,
0
0
0
2
,
5
0
0
,
0
0
0
(
1
,
7
6
6
)
(
5
6
9
,
0
1
8
)
4
,
4
2
9
,
2
1
6
-
-
-
3
,
3
7
3
,
9
2
6
3
,
3
7
3
,
9
2
6
2
2
-
-
7
6
,
5
8
8
(
7
6
,
5
8
8
)
-
-
-
-
(
2
,
5
0
0
,
0
0
0
)
(
2
,
5
0
0
,
0
0
0
)
2
,
5
0
0
,
0
0
0
2
,
5
0
0
,
0
0
0
7
4
,
8
2
2
2
2
8
,
3
2
0
5
,
3
0
3
,
1
4
2
2
2
(
)
2
2
(
)
1
0
(
)
(
)
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
FOR
THE
YEAR
ENDED
31st
DECEMBER
2
0
2
1
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Cash
flows
from
operating
a
c
t
i
v
i
t
i
e
s
Net
profit
before
t
a
x
a
t
i
o
n
3,3
6
5
,2
7
3
1
8
8
,6
1
3
Adjustments
f
o
r
:
D
e
p
r
e
c
i
a
t
i
o
n
3,2
4
9
1,0
0
0
Investment
i
n
c
o
m
e
(
)
(
)
(
6
,8
6
9
,4
8
2
)
(
2
,8
8
0
,7
7
3
)
Interest
e
x
p
e
n
s
e
s
3,4
5
4
,9
8
9
2,6
0
5
,4
7
4
Fair
value
gain
on
interest-free
long
term
r
e
c
e
i
v
a
b
l
e
(
)
7
6
,5
8
8
(
1
1
9
,6
4
6
)
Operating
profit
before
working
capital
c
h
a
n
g
e
s
3
0
,6
1
7
(
2
0
5
,3
3
2
)
Trade
and
other
r
e
c
e
i
v
a
b
l
e
s
(
)
(
1
1
8
,7
7
4
)
5,750,826
Inventory
-
Development
P
r
o
j
e
c
t
(
)
-
-
Trade
and
other
p
a
y
a
b
l
e
s
(
)
1,5
0
0
,0
5
7
(42,739)
Cash
generated
from
o
p
e
r
a
t
i
o
n
s
(5,365,743 )
1,4
1
1
,9
0
0
5,5
0
2
,7
5
5
Interest
p
a
y
a
b
l
e
(
)
(
)
(
3
,4
5
4
,9
8
9
)
(
2
,6
0
5
,4
7
4
)
Income
tax
p
a
i
d
(
)
(
)
2
2
,9
2
6
(
4
4
,8
2
3
)
Net
cash
from
/
(used
in)
operating
a
c
t
i
v
i
t
i
e
s
(10,861,285 )
(
2
,0
2
0
,1
6
3
)
2,852,458
Cash
flows
from
investing
a
c
t
i
v
i
t
i
e
s
Purchase
of
fixed
a
s
s
e
t
s
(
)
(
)
-
-
Investments
(
n
e
t
)
(
)
(
)
(
3
,5
7
8
,1
0
0
)
(
9
0
,0
2
0
)
Investment
i
n
c
o
m
e
6,8
6
9
,4
8
2
2,8
8
0
,7
7
3
Net
cash
from
/
(used
in)
investing
a
c
t
i
v
i
t
i
e
s
(
)
3,2
9
1
,3
8
2
2,7
9
0
,7
5
3
Cash
flows
from
financing
a
c
t
i
v
i
t
i
e
s
S
h
a
r
e
h
o
l
d
e
r
s
'
l
o
a
n
s
(
)
2
6
8
,4
3
3
(
1
,6
7
8
,0
2
6
)
Related
p
a
r
t
i
e
s
(
)
(
)
1
3
,9
8
2
,4
1
8
(
1
5
,6
5
4
,4
7
6
)
Bank
loans
(
n
e
t
)
4,7
9
0
,3
3
2
-
Bonds
and
d
e
b
e
n
t
u
r
e
s
(
)
(
8
6
2
,3
0
5
)
1
2
,8
7
3
,2
5
6
Other
l
o
a
n
s
(
)
6,1
8
5
,7
7
9
(
6
,7
3
0
,7
0
8
)
D
i
v
i
d
e
n
d
s
p
a
i
d
(
)
(
2
,5
0
0
,0
0
0
)
-
Net
cash
(used
in)
/
from
financing
a
c
t
i
v
i
t
i
e
s
2
1
,8
6
4
,6
5
7
(
1
1
,1
8
9
,9
5
4
)
Movement
in
cash
and
cash
e
q
u
i
v
a
l
e
n
t
s
(
)
2
3
,1
3
5
,8
7
6
(
5
,5
4
6
,7
4
3
)
Cash and cash equivalents at beginning of the year
1
3
,4
6
1
,0
7
5
2
0
,1
9
5
,5
3
9
1
2
,4
3
8
,7
8
2
1
7
,9
8
5
,5
2
5
Cash and cash equivalents at end of the year (note 18)
3
6
,5
0
7
,1
2
8
1
3
,4
6
1
,0
7
5
3
5
,5
7
4
,6
5
8
1
2
,4
3
8
,7
8
2
The
notes
on
pages
14
to
40
are
an
integral
part
of
these
financial
s
t
a
t
e
m
e
n
t
s
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1
4
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
The principal
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.
1.1
Basis
of
p
r
e
p
a
r
a
t
i
o
n
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
j
u
d
g
e
m
e
n
t
s
The
preparation
of
financial
statements
in
conformity
with
IFRSs
as
adopted
by
the
EU
requires
the
use
of
certain
accounting
estimates.
It
also
requires
directors
to
exercise
their
judgements
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
directors,
the
accounting
estimates
and
judgements
made
in
the
course
of
preparing
these
financial
statements
are
not
difficult,
subjective
or
complex
to
a
degree
which
would
warrant
their
description as critical in terms of the requirements of IAS 1.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1
5
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
1.1
Basis
of
preparation
-
c
o
n
t
i
n
u
e
d
Standards,
interpretations
and
amendments
to
published
standards
effective
in
2
0
2
1
The
Group
adopted
new
standards,
amendments
and
interpretations
to
existing
standards
that
are
mandatory
for
the
Group’s
accounting
period
beginning
on
1
January
2021.
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 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.
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
new
standards,
interpretations
and
amendments
will
have
a
material
impact
on
the
Group’s
financial
s
t
a
t
e
m
e
n
t
s
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1
6
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
1.2
Segment
r
e
p
o
r
t
i
n
g
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
one
segment,
that
is
raising
financial
resources
from
capital
markets
to
finance
the
capital
projects
of
the
Company.
All
the
Company’s
revenue
and
expenses
are
generated
in
Malta
and
revenue
is
mainly
earned
from the development of immovable property.
1.3
F
o
r
e
i
g
n
c
u
r
r
e
n
c
y
t
r
a
n
s
l
a
t
i
o
n
(a)
Functional
and
presentation
c
u
r
r
e
n
c
y
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 company’s functional currency and presentation currency.
(b)
Transactions
and
B
a
l
a
n
c
e
s
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.
1.4
Financial
a
s
s
e
t
s
1.4.1
C
l
a
s
s
i
f
i
c
a
t
i
o
n
The
Group
classifies
it's
financial
assets
as
measured
at
amortised
cost,
as
designated
at
fair
value
through
other
comprehensive
income
(FVOCI)
and
as
designated
at
fair
value
through
profit
or
loss
(FVTPL).
The
classification
is
based
on
the
business
model
in
which
a
financial
asset
is
managed
and
its
contractual
cash
f
l
o
w
s
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1
7
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
1.4
Financial
assets
-
(
c
o
n
t
i
n
u
e
d
)
1.4.2
Recognition
and
m
e
a
s
u
r
e
m
e
n
t
A
financial
asset
is
measured
at
amortised
cost
if
it
meets
both
of
the
following
conditions
and
is
not
designated at FVTPL:
i.
the asset
is held
within a
business model
whose objective
is to
hold assets
to collect
contractual cash
flows; and
ii.
the
contractual
terms
of
the
financial
asset
give
rise
on
specified
dates
to
cash
flows
that
are
Solely
Payments of Principle and Interest (“SPPI”).
A
debt
instrument
is
measured
at
FVOCI
only
if
it
meets
both
of
the
following
conditions
and
is
not
designated
as FVTPL:
i.
the asset is
held
within
a business
model
whose objective
is achieved by
both collecting contractual
cash
flows and selling financial assets; and
ii.
the
contractual
terms
of
the
financial
asset
give
rise
on
specified
dates
to
cash
flows
that
are
S
P
P
I
.
On
initial
recognition
of
an
equity
investment
that
is
not
held-for-trading,
the
Group
may
irrevocably
elect
to
present
subsequent
changes
in
fair
value
in
OCI.
This
election
is
made
on
an
investment-by-investment
b
a
s
i
s
.
All
other
financial
assets
are
classified
as
measured
at
F
V
T
P
L
.
In
addition,
on
initial
recognition,
the
Group
may
irrevocably
designate
a
financial
asset
that
otherwise
meets
the
requirements
to
be
measured
at
amortised
cost
or
at
FVOCI
at
FVTPL
if
doing
so
eliminates
or
significantly reduces an accounting mismatch that would otherwise arise.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1
8
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
1.4
Financial
assets
-
(
c
o
n
t
i
n
u
e
d
)
1.4.3
I
m
p
a
i
r
m
e
n
t
The
Group
assesses
on
a
forward-looking
basis
the
expected
credit
losses
(ECL)
associated
with
its
debt
instruments
carried
at
amortised
cost.
The
impairment
methodology
applied
depends
on
whether
there
has
been
a
significant
increase
in
credit
risk.
The
company’s
financial
assets
are
subject
to
the
expected
credit
loss model.
Expected
credit
loss
m
o
d
e
l
The
company
measures
loss
allowances
at
an
amount
equal
to
lifetime
ECLs,
except
for
the
following,
which
are measured at 12-month ECLs:
i.
debt
securities
that
are
determined
to
have
low
credit
risk
at
the
reporting
date;
a
n
d
ii.
other debt securities and bank balances for which credit risk has not increased significantly since initial
r
e
c
o
g
n
i
t
i
o
n
.
When
determining
whether
the
credit
risk
of
a
financial
asset
has
increased
significantly
since
initial
recognition
and
when
estimating
ECLs,
the
Group
considers
reasonable
and
supportable
information
that
is
relevant
and
available
without
undue
cost
or
effort.
The
Group
assumes
that
the
credit
risk
on
a
financial
asset
has
increased
significantly
if
it
is
more
than
30
days
past
due
date
and
it
considers
a
financial
asset
to
be
in
default
when
the
borrower
is
unlikely
to
pay
its
credit
obligations
to
the
Group
in
full,
without
recourse
by
the
Group
to
actions
such
as
realising
security
(if
any
is
held)
or
the
financial
asset
is
more
than
90
days
past due date.
Lifetime
ECLs
are
the
ECLs
that
result
from
all
possible
default
events
over
the
expected
life
of
a
financial
instrument:
12-month
ECLs
are
the
portion
of
ECLs
that
result
from
default
events
that
are
possible
within
the
12
months
after
the
reporting
date
(or
a
shorter
period
if
the
expected
life
of
the
instrument
is
less
than
12
months).
The
maximum
period
considered
when
estimating
ECLs
is
the
maximum
contractual
period
over
which the company is exposed to credit risk.
ECLs
are
probability-weighted
estimate
of
credit
losses.
Credit
losses
are
measured
as
the
present
value
of
all cash shortfalls. ECLs are discounted at the effective interest rate of the financial asset.
At
each
reporting
date,
the
company
assesses
whether
financial
assets
carried
at
amortised
cost
are
credit-
impaired.
A
financial
asset
is
credit-impaired
when
one
or
more
events
that
have
a
detrimental
impact
on
the
estimated
future
cash
flows
of
the
financial
asset
have
occurred.
Evidence
that
a
financial
asset
is
credit
impaired
includes
observable
data
such
as
significant
financial
difficult
of
the
borrower
or
issuer
or
a
breach
of contract such as default or being more than 90 days past due date.
Loss
allowances
for
financial
assets
measured
at
amortised
cost
are
deducted
from
the
gross
carrying
amount
of the assets.
Simplified
approach
m
o
d
e
l
For
loans
and
trade
and
other
receivables,
the
Group
applies
the
simplified
approach
required
by
IFRS
9,
which required 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
2021
or
1
January
2021
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.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
1
9
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
1.5
C
o
n
s
o
l
i
d
a
t
i
o
n
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
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.
The
company
acquired
the
shares
in
its
subsidiaries
during
the
period
ended
31st
December
2016
and
the
period
ended
31st
December
2019.
The
subsidiaries
acquired
during
the
years
2016
and
2019
were
acquired
at
the
net
asset
value
of
the
subsidiaries
existing
and
adjusted
with
the
increase
in
the
value
of
the
immovable
property
arising
from
a
revaluation
of
the
immovable
property
at
market
value.
The
company
incorporated
two subsidiaries in the group in 2020 and 2021.
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 profit or loss.
The
Group
accounts
for
business
combinations
using
the
acquisition
method
when
control
is
transferred
to
the
Group.
The
consideration
transferred
in
the
acquisition
is
measured
at
fair
value
as
are
the
identifiable
net assets acquired.
1.6
Share
C
a
p
i
t
a
l
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.
1.7
Offsetting
financial
i
n
s
t
r
u
m
e
n
t
s
Financial
assets
and
liabilities
are
offset
and
the
net
amount
reported
in
the
statement
of
financial
position
when
there
is
a
legally
enforceable
right
to
set
off
the
recognised
amounts
and
there
is
an
intention
to
settle
on a net basis, or realise the asset and settle the liability simultaneously.
1.8
P
r
o
v
i
s
i
o
n
s
Provisions
are
recognised
when
the
company
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.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
0
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
1.9
Revenue
and
cost
r
e
c
o
g
n
i
t
i
o
n
Revenue
comprises
the
fair
value
of
the
consideration
received
or
receivable
for
the
sale
of
goods
and
services
in
the
ordinary
course
of
the
company’s
activities.
Revenue
is
shown
net
of
value
added
tax,
returns,
rebates
and
discounts.
The
company
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
have 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
company’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
company,
are
treated
as
payments
received
on account and presented within trade and other payable.
Other
operating
income
consisting
of
the
following
is
recognised
on
an
accruals
basis:
I
n
t
e
r
e
s
t
Dividends
receivable
are
accounted
for
on
a
cash
b
a
s
i
s
.
Costs are recognised when the related goods and services are sold, consumed or allocated, or when their
future useful lives cannot be determined.
1.1
0
Borrowing
c
o
s
t
s
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 profit and loss account in the period as incurred.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
1
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
1.1
1
Trade
and
other
p
a
y
a
b
l
e
s
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.
1.1
2
Other
financial
l
i
a
b
i
l
i
t
i
e
s
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
profit
or
loss
over
the
term
of
the
borrowings,
unless
the
interest
on
such
borrowings
is
capitalised
in
accordance
with
the
company’s
accounting policy on borrowing costs.
Repurchases
of
Bonds
issued
by
the
company
-
If
the
company
repurchases
a
part
of
a
financial
liability,
the
company
allocates
the
previous
carrying
amount
of
the
financial
liability
between
the
part
that
continues
to
be
recognised
and
the
part
that
is
derecognised
based
on
the
relative
fair
values
of
those
parts
on
the
date
of
the
repurchase.
The
difference
between
the
carrying
amount
allocated
to
the
part
derecognised
and
the
consideration
paid,
including
any
non-cash
assets
transferred
or
liabilities
assumed,
for
the
part
derecognised
shall be recognised in profit or loss.
1.1
3
Property,
plant
and
e
q
u
i
p
m
e
n
t
All
property,
plant
and
equipment
are
initially
recorded
at
cost
and
subsequently
stated
at
cost
less
d
e
p
r
e
c
i
a
t
i
o
n
.
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
company
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:
Y
e
a
r
s
T
o
o
l
s
8
Computer
&
Off.
E
q
u
i
p
.
4
Motor
V
e
h
i
c
l
e
s
5
Furniture
&
F
i
t
t
i
n
g
s
1
0
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.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
2
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
1.1
4
I
n
v
e
n
t
o
r
y
-
D
e
v
e
l
o
p
m
e
n
t
p
r
o
j
e
c
t
The
main
object
of
the
Company
is
the
development
of
land
acquired
for
development
and
resale.
This
development
is
intended
in
for
resale
purposes,
and
is
accordingly
classified
in
the
financial
statements
as
Inventory.
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
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.
(i
i
)
The cost of various design and other studies conducted in connection with the project, together with all
other expenses incurred in connection therewith.
(i
i
i
)
Any
borrowing
costs,
including
imputed
interest,
attributable
to
the
development
phases
of
the
p
r
o
j
e
c
t
.
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.
As
stated
in
note
1.5
the
Group
accounts
for
business
combinations
using
the
acquisition
method.
Accordingly,
at
group
level,
the
identifiable
net
assets
acquired,
including
inventory
held
by
the
newly-
acquired
subsidiary,
are
measured
at
fair
value
as
at
date
of
acquisition
of
subsidiary.
Therefore,
at
consolidated
group
level,
inventory
cost
represents
the
fair
value
of
inventory
held
by
the
acquired
subsidiary
as
at
date
of
acquisition
of
subsidiary,
together
with
additional
development
and
borrowing
costs
incurred
following date of acquisition.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
3
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
1
Summary
of
significant
accounting
p
o
l
i
c
i
e
s
1.1
5
Cash
and
cash
e
q
u
i
v
a
l
e
n
t
s
Cash
and
cash
equivalents
as
shown
in
the
cashflow
statement
comprise
cash
in
hand
and
deposits
repayable
on
demand
less
bank
overdrafts.
Bank
overdrafts
are
included
in
the
statement
of
financial
position
as borrowings under current liabilities.
1.1
6
Current
and
deferred
t
a
x
The
tax
expense
for
the
period
comprises
current
and
deferred
tax.
Tax
is
recognised
in
profit
or
loss,
except
to
the
extent
that
it
relates
to
items
recognised
in
other
comprehensive
income
or
directly
in
equity.
In
this
case, the tax is also recognised in other comprehensive income or directly in equity, respectively.
Deferred
tax
is
recognised,
using
the
liability
method,
on
temporary
differences
arising
between
the
tax
bases
of
assets
and
liabilities
and
their
carrying
amounts
in
the
financial
statements.
However,
deferred
tax
liabilities
are
not
recognised
if
they
arise
from
the
initial
recognition
of
goodwill;
deferred
tax
is
not
accounted
for
if
it
arises
from
initial
recognition
of
an
asset
or
liability
in
a
transaction
other
than
a
business
combination
that
at
the
time
of
the
transaction
affects
neither
accounting
nor
taxable
profit
or
loss.
Deferred
tax
is
determined
using
tax
rates
(and
laws)
that
have
been
enacted
or
substantively
enacted
by
the
end
of
the
reporting
period
and
are
expected
to
apply
when
the
related
deferred
tax
asset
is
realised
or
the
deferred
tax
liability
is
settled.
Deferred
tax
assets
are
recognised
only
to
the
extent
that
it
is
probable
that
future
taxable
profit
will
be
available against which the temporary differences can be utilised.
Deferred
tax
assets
and
liabilities
are
offset
when
there
is
a
legally
enforceable
right
to
offset
current
tax
assets
against
current
tax
liabilities
and
when
the
deferred
tax
assets
and
liabilities
relate
to
income
taxes
levied
by
the
same
taxation
authority
on
either
the
same
taxable
entity
or
different
taxable
entities
where
there
is an intention to settle the balance on a net basis.
1.1
7
D
i
v
i
d
e
n
d
d
i
s
t
r
i
b
u
t
i
o
n
Dividend distribution to the Company’s shareholders is recognised as a liability in the Company’s financial
statements in the period in which the dividends are approved by the Company’s shareholders.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
4
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
2
Financial
risk
m
a
n
a
g
e
m
e
n
t
2.1
Financial
risk
f
a
c
t
o
r
s
The
Group’s
activities
potentially
expose
it
to
a
variety
of
risks:
market
risk,
economic
risk,
counter-party
risk,
credit
risk
and
liquidity
risk.
Where
possible,
the
board
provides
principles
for
overall
risk
management,
as
well as policies to mitigate these risks in the most prudent way.
(i)
The
Group
is
subject
to
market
and
economic
conditions
g
e
n
e
r
a
l
l
y
The
Group
is
subject
to
the
general
market
and
economic
risks
that
may
have
a
significant
impact
on
the
projects
of
the
subsidiaries,
the
timely
completion
of
the
said
projects
and
budgetary
constraints.
These
include
factors
such
as
the
state
of
the
local
property
market,
inflation,
and
fluctuations
in
interest
rates,
exchange
rates,
property
prices
and
other
economic
and
social
factors
affecting
demand
for
real
estate
generally.
If
general
economic
conditions
and
property
market
conditions
experience
a
downturn
which
is
not
contemplated
in
the
Group’s
planning
during
the
construction
and
completion
of
the
projects,
this
shall
have
an
adverse
impact
on
the
financial
condition
of
the
Group
and
the
ability
of
the
Company
to
meet
its
o
b
l
i
g
a
t
i
o
n
s
.
(i
i
)
The
property
market
is
a
very
competitive
market
that
can
influence
the
sales
of
units
in
the
P
r
o
j
e
c
t
s
The
real
estate
market
in
Malta
is
very
competitive
in
nature.
An
increase
in
supply
and/or
a
reduction
in
demand
in
the
property
segments
in
which
the
Group
operates
and
targets
to
sell
the
remaining
units
in
stock
and
the
properties
being
developed,
may
cause
sales
of
units
forming
part
of
the
projects
to
sell
at
prices
which
are
lower
than
is
being
anticipated
by
the
Group
or
that
sales
of
such
units
are
in
fact
slower
than
is
being
anticipated.
If
these
risks
were
to
materialise,
particularly
if
due
to
unforeseen
circumstances
there
is
a
delay
in
the
tempo
of
sales
envisaged
by
the
Group,
they
could
have
a
material
adverse
impact
on
the
Group
and the Issuer’s ability to meet its obligations.
(i
i
i
)
The
Group
depends
on
third
parties
in
connection
with
its
business,
giving
rise
to
counterparty
r
i
s
k
s
The
Group
relies
upon
third-party
service
providers
such
as
architects,
building
contractors
and
suppliers
for
the
construction
and
completion
of
each
of
the
projects
of
its
subsidiaries.
The
Group
has
engaged
the
services
of
third
party
contractors
for
the
development
of
the
projects
including,
excavation,
construction
and
finishing
of
the
developments
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,
the
resulting
development
delays
in
completion
could
have
an
adverse
impact
on
the
Group’s
businesses,
and
their
respective
financial
condition,
results
of
operations
and
prospects,
that
could
have
a
material
adverse
impact on the Issuer’s ability to meet its obligations.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
5
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
2
Financial
risk
management
-
c
o
n
t
i
n
u
e
d
2.1
Financial
risk
factors
-
c
o
n
t
i
n
u
e
d
(i
v
)
Material
risks relating
to
real
estate
development may
affect the
economic
performance
and
value
of the
P
r
o
j
e
c
t
s
There
are
several
factors
that
commonly
affect
the
real
estate
development
industry,
many
of
which
are
beyond
the
Group’s
control,
and
which
could
adversely
affect
the
economic
performance
and
value
of
the
Group’s projects. Such factors include:
-
changes
in
European
and
global
economic
c
o
n
d
i
t
i
o
n
s
;
-
changes
in
the
general
economic
conditions
in
M
a
l
t
a
;
-
general
industry
trends,
including
the
cyclical
nature
of
the
real
estate
m
a
r
k
e
t
;
-
changes
in
local
market
conditions,
such
as
an
oversupply
of
similar
p
r
o
p
e
r
t
i
e
s
;
-
a
reduction
in
demand
for
real
estate
or
change
of
local
preferences
and
t
a
s
t
e
s
;
-
possible
structural
and
environmental
p
r
o
b
l
e
m
s
;
-
changes
in
the
prices,
supply
of
raw
m
a
t
e
r
i
a
l
s
;
-
acts
of
nature
that
may
damage
any
of
the
properties
or
delay
development
t
h
e
r
e
o
f
.
(v)
The
Group
may
be
exposed
to
environmental
liabilities
attaching
to
real
estate
p
r
o
p
e
r
t
y
The
Group
may
become
liable
for
the
costs
of
removal,
investigation,
or
remediation
of
any
hazardous
or
toxic
substances
that
may
be
located
on,
or
in
or
which
may
have
migrated
from,
a
property
owned
or
occupied
by
it,
which
costs
may
be
substantial.
The
Group
may
also
be
required
to
remove
or
remedy
any
hazardous
substances
that
it
causes
or
knowingly
permits
at
any
property
that
it
owns
or
may
in
future
own.
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
real
estate
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
realised,
could
have
an
adverse
effect
on
the
Group’s
operations
and financial position.
(v
i
)
Property
valuations
may
not
reflect
actual
market
v
a
l
u
e
s
The
valuations
of
the
properties
on
which
the
share
acquisitions
were
based
were
prepared
by
an
independent
qualified
architect
in
accordance
with
the
valuation
standards
published
by
the
Royal
Institution
of
Chartered
Surveyors
(RICS).
In
providing
a
market
value
of
the
respective
properties,
the
independent
architect
has
made
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.
There
can
be
no
assurance that such property valuations and property-related assets will reflect actual market values.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
6
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
2
Financial
risk
management
-
c
o
n
t
i
n
u
e
d
2.1
Financial
risk
factors
-
c
o
n
t
i
n
u
e
d
(v
i
i
)
General
exposure
to
funding
r
i
s
k
s
The
funding
of
each
project
is
partly
dependent
on
the
proceeds
from
the
gradual
sale
of
the
units
in
each
development.
If
the
projected
sale
of
the
units
is
not
attained
or
is
delayed,
the
Group
may
well
not
have
sufficient
funds
to
complete
all
the
projects
within
the
projected
time-frames
or
to
pay
the
contractors
for
works
performed.
(v
i
i
i
)
The
Group
may
be
exposed
to
cost
overruns
and
delays
in
completion
of
the
p
r
o
j
e
c
t
s
Each
of
the
projects
being
undertaken
by
the
Group
is
prone
to
certain
risks
inherent
in
real
estate
development,
most
notably
the
risk
of
completing
each
project
within
its
scheduled
completion
date
and
within
the
budgeted
cost
for
that
development.
If
either
or
both
risks
were
to
materialise
they
could
have
a
significant
impact
on
the
financial
condition
of
the
respective
subsidiary
and/or
the
Group,
and
the
ability
of
the
latter
to
meet
its
obligations.
The
risks
of
delays
and
cost
overruns,
could
cause
actual
sales
revenues
and
costs
to
differ
from
those
projected
and
which
are
affected,
amongst
others,
by
factors
attributable
to
counter-parties,
general
market
conditions,
and
competition
which
are
beyond
the
Group’s
control.
Delays
in
the
time
scheduled
for
completion
of
one
or
more
of
the
projects
may
also
cause
significant
delays
in
the
tempo
of
the
sales
forecasted
by
the
Group
for
units
within
the
Project
or
Projects
affected
by
such
delay,
which
can
have
a
significant
adverse
impact
on
the
Group’s
financial
condition
and
cash
flows.
Similarly,
if
any
one
or
more
of
the
projects
were
to
incur
significant
cost
overruns
that
were
not
anticipated,
the
Group
may
have
difficulties
in
sourcing
the
funding
required
for
meeting
such
cost
overruns
and
therefore
may
risk
not
completing
one
or
more
of
the
projects,
which
shall
have
a
material
adverse
impact
on
the
cash
flows
generated
from
sales
of
units
in
that
Project
and
a
material
adverse
impact
on
the
financial
condition
of
the
specific
subsidiary
and
ultimately
the
Issuer.
The
directors
are
closely
monitoring
closely
inflationary
risks
resulting
from
the
conflict
in Ukraine and the aftermath of the COVID pandemic.
(i
x
)
Foreign
Exchange
r
i
s
k
Foreign
exchange
risk
arises
from
future
commercial
transactions
and
recognised
assets
and
liabilities
which
are
denominated
in
a
currency
that
is
not
the
entity's
functional
currency.
As
at
reporting
date,
the
Company
has no currency risk since all assets and liabilities are denominated in Euro.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
7
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
2
Financial
risk
management
-
c
o
n
t
i
n
u
e
d
2.1
Financial
risk
factors
-
c
o
n
t
i
n
u
e
d
(x)
Fair
value
interest
rate
r
i
s
k
The
Company
is
exposed
to
risks
associated
with
the
effects
of
fluctuations
in
the
prevailing
levels
of
the
market interest rates on its interest bearing financial instruments.
As
at
the
reporting
date,
the
Company
holds
available
for
sale
investments
which
are
limited
to
Corporate
bonds
and
bank
deposits.
The
4.25%
Secured
Bonds
2023,
the
3.65%
Secured
Bonds
2022
and
the
3.7%
Secured
Bonds
2023
-
2025
which
represent
about
90%
of
the
group’s
third
party
borrowings
are
subject
to
fixed
interest
rates,
whereas
the
other
10%
of
the
group’s
third
party
borrowings
are
subject
to
interest
rate
fluctuations.
Based
on
the
above,
the
board
considers
the
potential
impact
on
profit
or
loss
of
a
defined
interest rate shift at the reporting date to be quite contained.
(x
i
)
L
i
q
u
i
d
i
t
y
r
i
s
k
The
company
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
company's
financial
obligations
and
to
safeguard
the
Company’s
ability
to
continue
as
a
going
concern, in particular to complete the Group’s projects in a timely manner.
On
6
December
2021,
the
company
published
a
Prospectus
for
the
issue
of
€21,000,000
secured
bonds
of
a
nominal
value
of
€100
each.
Part
of
the
net
proceeds
will
be
used
to
finance
the
acquisition
of
a
plot
of
Land
in
Qawra
(referred
to
as
Qawra
III
Development)
whereas
the
remaining
balance
will
be
used
to
finance
the
working capital requirements of three different projects in 2022.
In
the
next
12
months,
the
group
requires
to
raise
further
funding
to
finish
the
plot
of
land
of
Qawra
III
Development.
Funds
should
primarily
be
raised
through
the
issue
of
another
bond.
In
the
event
that
the
bond
will
not
be
issued,
or,
should
it
become
unfeasible
for
the
Issuer
to
proceed
with
a
capital
market
transaction
due
to
prevailing
market
conditions
affecting
the
demand
for
the
purchase
of
listed
debt
instruments
of
the
Issuer,
the
Group
may
be
required
to
fund
the
additional
funding
through
bank
finance,
own
reserves
or
a
mix
thereof.
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
company
has
ample
experience
in
the
industry
and
has
always
managed to obtain the appropriate funding and completed projects within pre-determined time-frames.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
8
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
2
Financial
risk
management
–
c
o
n
t
i
n
u
e
d
2.1
Financial
risk
factors
-
c
o
n
t
i
n
u
e
d
(x
i
i
)
Capital
risk
m
a
n
a
g
e
m
e
n
t
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
4.25%
Secured
Bonds
2023,
the
3.65% Secured Bonds 2022 and the 3.7% Secured Bonds 2023-2025.
The
capital
structure
consists
of
items
presented
within
equity
in
the
statement
of
financial
position.
The
company monitors the level of debt against total capital on an ongoing basis.
(x
i
i
i
)
Credit
r
i
s
k
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
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
financial
assets
held
in
the
Reserve
Account,
cash
and
cash
equivalents
and
available
for
sale
investments.
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
carried
out
solely
by
the
Company’s
stockbroker
(and
Sponsor/Manager
of
the
4.25%
2023
Secured
Bonds,
the
3.65%
2022
Secured
Bonds
and
the
3.7%
Secured
Bonds
2023-2025).
During
the
year
under
review,
the
available
for
sale
investments
were
limited
to
purchases
in
reliable
Corporate
Bonds
(€9.6
Million)
whilst
the
cash
at
Bank
was
held
with
local
quality
financial
institutions
(€35.25
Million).
The
Reserve
Account
is
administered
by
the
Security
Trustee
of
the
4.25%
2023
Secured
Bonds
and
the
3.65%
2022
Secured
Bonds
issues
and
funds
are held in a bank account of high standing.
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.
The
Board
retains
direct
responsibility
for
affecting
and
monitoring
the
investments
made
by
the
fellow
companies.
The
Board
considers these receivables to be fully performing and recoverable.
3
T
u
r
n
o
v
e
r
Turnover
represents
the
sale
of
property
held
for
development
and
resale,
and
is
made
up
as
f
o
l
l
o
w
s
:
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
Sale
of
property
held
for
Development
and
r
e
s
a
l
e
€
€
€
€
5
0
,
1
1
6
,
4
5
9
2
3
,
7
8
5
,
9
2
8
-
-
5
0
,
1
1
6
,
4
5
9
2
3
,
7
8
5
,
9
2
8
-
-
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
2
9
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
4
Operating
profit
/
(
l
o
s
s
)
The
operating
profit
/
(loss)
for
the
year
is
stated
after
charging
:
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
€
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
Directors'
f
e
e
s
1
8
6
,0
5
8
155,742
-
-
Employment
c
o
s
t
s
-
Note
5
6
7
1
,7
4
2
538,626
-
-
D
e
p
r
e
c
i
a
t
i
o
n
-
Note
1
1
1
4
,1
0
6
9,004
3,249
1,0
0
0
Audit
fees
-
Annual
statutory
a
u
d
i
t
43,057
43,057
12,803
7,0
2
1
5
E
m
p
l
o
y
e
e
s
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Employment
costs
c
o
m
p
r
i
s
e
:
Wages
and
salaries
-
a
d
m
i
n
i
s
t
r
a
t
i
o
n
1
8
4
,9
5
9
1
3
4
,9
1
4
-
-
Wages
and
salaries
-
allocated
to
cost
of
s
a
l
e
s
4
5
1
,9
8
4
3
7
4
,8
5
6
-
-
Social
security
costs
-
a
d
m
i
n
i
s
t
r
a
t
i
o
n
1
0
,4
0
8
6,5
2
2
-
-
Social
security
costs
-
allocated
to
cost
o
f
s
a
l
e
s
2
4
,3
9
1
22,334
-
-
6
7
1
,7
4
2
5
3
8
,6
2
6
-
-
The
average
weekly
number
of
persons
employed by the group during the year was:
19
16
-
-
Directors' Remuneration
4
2
,0
0
0
1
2
,0
0
0
-
-
Directors'
salary
-
allocated
to
cost
of
s
a
l
e
s
144,058
143,742
-
-
1
8
6
,0
5
8
1
5
5
,7
4
2
-
-
6
Finance
c
o
s
t
s
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Interest and amortisation costs
1,5
7
4
,1
8
9
1,4
9
6
,4
2
7
3,4
5
4
,9
8
9
2,2
9
1
,0
7
7
Premium
on
buy-back
of
B
o
n
d
s
-
314,397
-
3
1
4
,3
9
7
1,5
7
4
,1
8
9
1,8
1
0
,8
2
4
3,4
5
4
,9
8
9
2,6
0
5
,4
7
4
Finance
costs
allocated
to
cost
of
sales
(Inventories
-
Property
d
e
v
e
l
o
p
m
e
n
t
)
At
1st
J
a
n
u
a
r
y
2,5
9
8
,4
9
4
3,2
5
1
,0
2
8
-
-
Interest
capitalised
during
y
e
a
r
1,5
5
5
,5
1
5
1,5
6
3
,8
7
7
-
-
At
31st
D
e
c
e
m
b
e
r
(
2
,4
7
9
,3
4
9
)
(
2
,5
9
8
,4
9
4
)
-
-
Charge
of
capitalised
interest
for
the
y
e
a
r
1,674,660
2,216,411
-
-
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
0
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
7
I
n
v
e
s
t
m
e
n
t
i
n
c
o
m
e
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Interest
from
Maltese
b
a
n
k
s
-
2
2
7
-
9
6
Interest
receivable
from
related
p
a
r
t
i
e
s
2
9
4
,4
4
9
2
7
4
,5
9
4
3,4
4
6
,6
7
9
2,5
6
5
,6
7
0
Interest
receivable
from
i
n
v
e
s
t
m
e
n
t
s
3
9
7
,0
0
1
3
1
6
,8
0
7
3
9
7
,0
0
1
3
1
5
,0
0
7
Gains/disposal
on
i
n
v
e
s
t
m
e
n
t
2
5
,8
0
2
-
2
5
,8
0
2
-
Dividends
receivable
from
related
p
a
r
t
i
e
s
-
-
3,000,000
-
7
1
7
,2
5
2
5
9
1
,6
2
8
6,8
6
9
,4
8
2
2,8
8
0
,7
7
3
8
Tax
e
x
p
e
n
s
e
The
parent company and group’s
income
tax
charge
for
the
year
has
been
a
rrived
at
as
f
o
l
l
o
w
s
:
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
Current
income
t
a
x
€
€
€
€
Income
tax
on
taxable
income
at
1
5
%
6
7
,9
3
5
4
4
,8
4
1
6
7
,9
3
5
4
4
,8
2
1
Income
tax
subject
to
final
tax
of
5%
on
sales
of immovable property
2,3
7
3
,0
8
7
1,4
3
6
,7
4
1
-
-
Income
tax
subject
to
final
tax
of
8%
on
s
a
l
e
s
of
immovable
p
r
o
p
e
r
t
y
86,231
-
-Tax
c
h
a
r
g
e
2,5
2
7
,2
5
3
1,4
8
1
,5
8
2
6
7
,9
3
5
4
4
,8
2
1
The
accounting
profits
and
the
tax
charge
for
the
year
are
reconciled
as
shown
h
e
r
e
u
n
d
e
r
:
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Net
profit
for
the
y
e
a
r
11,391,904
5,583,772
3,365,273
1
8
8
,6
1
3
Income
tax
thereon
at
3
5
%
3,9
8
7
,1
6
6
1,9
5
4
,3
2
0
1,1
7
7
,8
4
6
6
6
,0
1
5
Deferred
tax
not
accounted
f
o
r
1
8
1
5
4,0
4
7
-
Difference
arising
from
interest
r
e
c
e
i
v
e
d
(
7
1
,0
1
7
)
(
3
2
,6
1
5
)
(
7
1
,0
1
7
)
-
Difference
resulting
from
different
tax
r
a
t
e
s
on
bank
interest
r
e
c
e
i
v
e
d
-
(
5
9
,7
8
8
)
-
(
5
9
,7
6
1
)
Expenses
disallowed
for
tax
p
u
r
p
o
s
e
s
2
6
3
,3
9
8
7
5
0
,5
4
4
1
6
,0
9
0
3
8
,5
6
7
Difference arising
on
income
subject
to
5-
8
%
withholding tax on sales of
immovable
property
D
i
f
f
e
r
e
n
c
e
a
r
i
s
i
n
g
o
n
a
d
j
u
s
t
m
e
n
t
t
o
(
3
,6
8
4
,4
4
7
)
(
2
,0
5
0
,1
8
6
)
-
-
revaluation
of
i
n
v
e
n
t
o
r
i
e
s
2,0
4
1
,1
6
6
9
1
9
,2
9
2
-
-
Exempt
i
n
c
o
m
e
(
9
,0
3
1
)
-
(
1
,0
5
9
,0
3
1
)
-
2,5
2
7
,2
5
3
1,481,582
67,935
4
4
,8
2
1
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
1
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
9
Fair
value
a
d
j
u
s
t
m
e
n
t
G
r
o
u
p
C
o
m
p
a
n
y
Difference arising on amortised cost on
interest
free
loan
given
to
Gap
Holdings
Limited (note 14)
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Amount as at 31st December
2,4
6
5
,7
8
1
2,4
6
5
,7
8
1
-
-
Amount
as
at
1st
J
a
n
u
a
r
y
(2,465,781)
(2,469,361)
-
-
-
(3,580)
-
-
10
D
i
v
i
d
e
n
d
s
The
group
issued
an
interim
dividend
of
€2,500,000
from
the
final
tax
account
during
the
current
year.
The
net
dividend
per
share
amounted
to
€1
per
share.
The
Directors
do
not
recommend
the
payment
of
a
final
d
i
v
i
d
e
n
d
.
11
Property,
plant
and
e
q
u
i
p
m
e
n
t
G
R
O
U
P
T
o
o
l
s
Computer
&
M
o
t
o
r
Furniture
&
T
o
t
a
l
Off.
E
q
u
i
p
.
V
e
h
i
c
l
e
s
F
i
t
t
i
n
g
s
€
€
€
€
€
C
o
s
t
At
1st
January
2
0
2
1
1,8
3
6
1
0
,5
9
2
5
4
,0
0
0
4
3
7
6
6
,8
6
5
Additions
during
the
y
e
a
r
-
8,4
9
1
-
1,2
8
3
9,7
7
4
At
31st
December
2
0
2
1
1,8
3
6
1
9
,0
8
3
5
4
,0
0
0
1,7
2
0
7
6
,6
3
9
D
e
p
r
e
c
i
a
t
i
o
n
At
1st
January
2
0
2
1
5
3
7
1
0
,5
9
2
3
2
,3
0
0
4
3
7
4
3
,8
6
6
Charge
for
the
y
e
a
r
4
6
0
2,6
4
1
1
0
,7
4
9
2
5
6
1
4
,1
0
6
At
31st
December
2
0
2
1
9
9
7
1
3
,2
3
3
4
3
,0
4
9
6
9
3
5
7
,9
7
2
Net
book
v
a
l
u
e
At
31st
December
2
0
2
1
8
3
9
5,8
5
0
1
0
,9
5
1
1,0
2
7
1
8
,6
6
7
At
31st
December
2
0
2
0
1,2
9
9
-
2
1
,7
0
0
-
2
2
,9
9
9
C
O
M
P
A
N
Y
M
o
t
o
r
T
o
t
a
l
V
e
h
i
c
l
e
s
€
€
C
o
s
t
At 1st January 2021
Additions
during
the
year
1
0
,0
0
0
-
1
0
,0
0
0
-
At
31st
December
2
0
2
1
1
0
,0
0
0
1
0
,0
0
0
D
e
p
r
e
c
i
a
t
i
o
n
At
1st
January
2
0
2
1
6,7
5
0
6,7
5
0
Charge
for
the
y
e
a
r
3,2
4
9
3,2
4
9
At
31st
December
2
0
2
1
9,9
9
9
9,9
9
9
Net
book
v
a
l
u
e
At
31st
December
2
0
2
1
1
1
At
31st
December
2
0
2
0
3,2
5
0
3,2
5
0
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
2
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
12
Investment
in
subsidiary
u
n
d
e
r
t
a
k
i
n
g
s
G
r
o
u
p
2021
&
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
Geom
Developments
Limited
(C50805)
is
the
parent
company
of
Gap
Group
Finance
Limited
(C54352)
which
is
the
parent
company
of
Manikata
Holdings
Limited
(C53818)
and
Gap
Properties
Limited
(C47928).
The
group
owns
all
the
shares
with
the
exception
of
a
few
shares
which
are
owned
by
third
parties.
The
amount
attributable to the minority interest is reflected in note 24.
The
principal
activity
of
all
the
subsidiaries,
except
for
Gap
Group
Contracting
Limited,
is
the
acquisition
of
property
for
development
and
resale.
The
activity
of
Gap
Group
Contracting
Limited
is
to
provide
services
to
the entities within the Group related to their trading activity.
2
0
2
0
€
€
€
Shares
in
subsidiary
u
n
d
e
r
t
a
k
i
n
g
s
Geom
Developments
Limited
(C50805)
-
2,000
ordinary
shares
of
€1
each
representing
100
%
holding
(Gap
H
o
l
d
i
n
g
s
Head
Office,
Censu
Scerri
Street,
T
i
g
n
e
.
)
-
1
0
,
5
8
0
,
4
4
4
1
0
,
5
8
0
,
4
4
4
Geom
Holdings
Limited
(C64409)
-
1,997
ordinary
shares
o
f
€1
each
representing
100
%
holding
(Gap
Holdings
Head
O
f
f
i
c
e
,
Censu
Scerri
Street,
T
i
g
n
e
.
)
-
2
,
6
5
1
,
1
3
0
2
,
6
5
1
,
1
3
0
Gap
Gharghur
Limited
(C72015)
-
320,000
ordinary
shares
of
€1
each
representing
100
%
holding
(Gap
Holdings
Head
O
f
f
i
c
e
,
Censu
Scerri
Street,
T
i
g
n
e
.
)
-
3
,
8
3
8
,
6
2
6
3
,
8
3
8
,
6
2
6
Gap
Mellieha
(I)
Limited
(C72013)
-
1,200
ordinary
shares
o
f
€1
each
representing
100
%
holding
(Gap
Holdings
Head
O
f
f
i
c
e
,
Censu
Scerri
Street,
T
i
g
n
e
.
)
-
4
,
4
8
7
,
1
7
4
4
,
4
8
7
,
1
7
4
Gap
Group
Contracting
Limited
(C75879)
-
1,200
ordinary
shares
of
€1
each
representing
100
%
holding
(Gap
H
o
l
d
i
n
g
s
Head
Office,
Censu
Scerri
Street,
T
i
g
n
e
.
)
-
1
,
2
0
0
1
,
2
0
0
Gap
Luqa
Limited
(C32225)
-
600
ordinary
shares
of
€
2
.
3
3
each
representing
100
%
holding
(Gap
Holdings
Head
O
f
f
i
c
e
,
Censu
Scerri
Street,
T
i
g
n
e
.
)
-
1
2
,
7
7
5
,
0
0
0
1
2
,
7
7
5
,
0
0
0
Gap
QM
Limited
(C96686)
-
5,000
ordinary
shares
of
€1
e
a
c
h
representing
100
%
holding
(Gap
Holdings
Head
Office,
C
e
n
s
u
Scerri
Street,
T
i
g
n
e
.
)
-
5
,
0
0
0
5
,
0
0
0
Gap
Qawra
Limited(C100513)
-
5,000
ordinary
shares
of
€
1
each
representing
100
%
holding
(Gap
Holdings
Head
O
f
f
i
c
e
,
Censu
Scerri
Street,
T
i
g
n
e
.
)
-
5
,
0
0
0
-
T
o
t
a
l
-
3
4
,
3
4
3
,
5
7
4
3
4
,
3
3
8
,
5
7
4
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
3
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
13
I
n
v
e
s
t
m
e
n
t
s
Investments -FVOCI
Investments -FVOCI
Interest rate
Redemption date
Redemption
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
G
r
o
u
p
C
o
m
p
a
n
y
Interest rate
d
a
t
e
2
0
2
0
€
€
Corporate Bonds3.75%20232,010,0002,010,000
Corporate Bonds 3.85%
2
0
2
6
700,000 700,000Corporate Bonds 3.65%2028911,900911,900
Corporate Bonds
3.80%
2
0
2
9
2,475,0002,475,0006,0
9
6
,9
0
0
6,0
9
6
,9
0
0
14
Other
financial
a
s
s
e
t
s
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Amount
receivable
from
Gap
H
o
l
d
i
n
g
s
Limited
-
Maturity
date
2
0
2
6
2,4
6
5
,7
8
1
2,4
6
5
,7
8
1
-
-
Amount
receivable
from
Gap
H
o
l
d
i
n
g
s
Limited
-
Maturity
date
2
0
2
6
8,2
1
0
,6
3
6
7,9
1
6
,1
8
8
8,2
1
0
,6
3
6
7,9
1
6
,1
8
8
Funds
held
by
trustee
for
the
redemption
o
f
the
2022
and
2023
B
o
n
d
s
-
2,1
0
7
,2
2
7
-
2,1
0
7
,2
2
7
Funds
held
by
trustee
relating
to
the
2023-
2025 Bonds
-
4,3
7
3
,0
0
0
-
4,3
7
3
,0
0
0
1
0
,6
7
6
,4
1
7
1
6
,8
6
2
,1
9
6
8,2
1
0
,6
3
6
1
4
,3
9
6
,4
1
5
At
31st
December
2021,
the
amount
due
by
Gap
Holdings
Limited
of
€2,465,781
(2020
€2,465,781)
is
non
interest
bearing
and
is
expected
to
be
repaid
by
December
2026
(2020
-
December
2025).
The
nominal
amount of the loan is €3,000,000.
The
amount
due
by
Gap
Holdings
Limited
of
€8,210,636
(2020
€7,916,188)
is
expected
to
be
repaid
by
December
2026
and
is
unsecured.
The
amount
receivable
bears
interest
at
4.0%
per
annum
(2020
-
3.7%
per annum).
€
€
Corporate
B
o
n
d
s
5
%
2023
2
,
3
5
0
,
0
0
0
2
,
3
5
0
,
0
0
0
Corporate
B
o
n
d
s
3
.
2
5
%
-
3
.
7
5
%
2
0
2
6
2
,
2
9
7
,
5
0
0
2
,
2
9
7
,
5
0
0
Corporate
B
o
n
d
s
3
.
8
5
%
2028
7
0
5
,
7
0
0
7
0
5
,
7
0
0
Corporate
B
o
n
d
s
C
o
r
p
o
r
a
t
e
B
o
n
d
s
C
o
r
p
o
r
a
t
e
B
o
n
d
s
3
.
6
5
%
-
3
.
8
0
%
3
.
5
0
%
3
.
6
5
%
2
0
2
9
2
0
3
1
2
0
3
3
3,402,900
3
,
4
0
2
,
9
0
0
7
1
1
,
9
0
0
7
1
1
,
9
0
0
2
0
2
,
0
0
0
2
0
2
,
0
0
0
9
,
6
7
0
,
0
0
0
9,670,000
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
15
R
e
s
e
r
v
e
A
c
c
o
u
n
t
`
Page 34.
2
0
2
1
2
0
2
0
€
€
The
reserve
fund
is
made
up
as
f
o
l
l
o
w
s
:
Amount
held
by
the
trustee
as
part
of
the
Investments
listed
u
n
d
e
r
Investments
(See
Note
13)
held
for
the
redemption
of
the
2022
and
2
0
2
3
B
o
n
d
9,6
7
0
,0
0
0
6,0
9
6
,9
9
0
Funds
held
by
trustee for
the
redemption
of
the
2022,
2023
and
2025
B
o
n
d
s
listed
under
Other
financial
assets
(See
Note
1
4
)
Amount
held
by
the
trustee
held
for
the
redemption
of
the
bonds
(refer
t
o
-
6,4
8
0
,2
2
7
note
1
8
)
35,246,911
7,5
2
8
,1
2
6
44,916,911
2
0
,1
0
5
,3
4
3
16
I
n
v
e
n
t
o
r
y
-
D
e
v
e
l
o
p
m
e
n
t
p
r
o
j
e
c
t
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Property
cost
of
land
and
development
c
o
s
t
s
4
0
,4
2
5
,9
6
0
5
1
,3
0
3
,4
1
2
-
-
Capitalised borrowing costs (refer to note 6)
2,4
7
9
,3
4
9
2,5
9
8
,4
9
4
-
-
Fair
value
adjustment
on
acquisition
of
s
u
b
s
i
d
i
a
r
i
e
s
Fair
value
adjustment
reversed
on
sale
of
p
r
o
p
e
r
t
y
2
3
,0
3
2
,9
2
7
2
3
,0
3
2
,9
2
7
-
-
(20,117,817)
(14,285,915)
-
-
4
5
,8
2
0
,4
1
9
6
2
,6
4
8
,9
1
8
-
-
17
Trade
and
other
r
e
c
e
i
v
a
b
l
e
s
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Amounts
r
e
c
e
i
v
a
b
l
e
2,7
8
2
,9
1
8
6
5
1
,2
8
3
-
-
Amounts
due
from
group
c
o
m
p
a
n
i
e
s
-
-
6
3
,6
0
6
,3
5
0
4
1
,0
8
6
,8
6
5
Amount
due
from
related
p
a
r
t
i
e
s
6,5
2
3
,2
0
8
3,5
7
7
,2
1
6
8
2
2
,3
6
7
7
2
,8
8
4
Accrued
interest
r
e
c
e
i
v
a
b
l
e
174,684
55,909
174,684
5
5
,9
0
9
9,4
8
0
,8
1
0
4,2
8
4
,4
0
8
6
4
,6
0
3
,4
0
1
4
1
,2
1
5
,6
5
8
The
amounts
due
from
the
group
companies
and
the
related
parties
are
interest
free
and
repayable
on
d
e
m
a
n
d
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
5
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
18
Cash
and
cash
e
q
u
i
v
a
l
e
n
t
s
Cash
and
cash
equivalents
included
in
the
cash
flow
statement
c
o
m
p
r
i
s
e
:
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Cash
in
h
a
n
d
2
4
6
,4
2
3
1
4
6
,2
4
3
-
-
Bank
d
e
p
o
s
i
t
s
3
6
,2
6
0
,7
0
5
1
3
,8
1
5
,0
3
7
3
5
,5
7
4
,6
5
8
1
2
,9
3
8
,7
8
2
3
6
,5
0
7
,1
2
8
1
3
,9
6
1
,2
8
0
3
5
,5
7
4
,6
5
8
1
2
,9
3
8
,7
8
2
Bank
o
v
e
r
d
r
a
f
t
-
(500,205)
-
(
5
0
0
,0
0
0
)
36,507,128
13,461,075
35,574,658
1
2
,4
3
8
,7
8
2
19
Share
c
a
p
i
t
a
l
A
u
t
h
o
r
i
s
e
d
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
2,500,000
Ordinary
shares
of
€1
e
a
c
h
2,5
0
0
,0
0
0
2,500,000
2,500,000
2,5
0
0
,0
0
0
2,5
0
0
,0
0
0
2,500,000
2,500,000
2,5
0
0
,0
0
0
Issued
and
fully
paid
u
p
2,500,000
Ordinary
shares
of
€1
e
a
c
h
2,5
0
0
,0
0
0
2,5
0
0
,0
0
0
2,5
0
0
,0
0
0
2,5
0
0
,0
0
0
2,5
0
0
,0
0
0
2,500,000
2,500,000
2,5
0
0
,0
0
0
20
Earnings
per
s
h
a
r
e
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.
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
Profit
for
the
y
e
a
r
€
€
4,1
0
2
,1
9
0
€
€
1
4
3
,7
9
2
Weighted
average
share
in
i
s
s
u
e
2,5
0
0
,0
0
0
2,5
0
0
,0
0
0
2,5
0
0
,0
0
0
2,5
0
0
,0
0
0
Earnings
per
s
h
a
r
e
3.5
5
1.6
4
1.3
2
0.0
6
The
company
has
not
issued
any
dilutive
instruments
in
the
past,
and
therefore
the
basic
and
diluted
earnings per share are equal.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
6
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
21
Subordinated
shareholders'
loan
-
Quasi
e
q
u
i
t
y
Group
and
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
€
€
S
h
a
r
e
h
o
l
d
e
r
s
'
l
o
a
n
2,500,000
2,5
0
0
,0
0
0
2,500,000
2,5
0
0
,0
0
0
The
shareholders'
loan,
classified
as
"Subordinated
shareholders'
loan
-
Quasi
equity"
was
advanced
to
the
company
by
the
shareholders
in
connection
with
the
raising
of
funds
through
the
first
bond
issue
(see
note
23).
The
amount
is
interest
free
and
is
only
repayable
to
the
shareholders
after
the
settlement
of
the
amount
due to the Bond holders.
22
R
e
v
a
l
u
a
t
i
o
n
r
e
s
e
r
v
e
G
r
o
u
p
C
o
m
p
a
n
y
Gain
on
amortisation
of
long
term
interest
free loan receivable (see note 9)
Gain
on
revaluation
of
Investments
at
year
end rates
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
4
3
5
,7
3
0
4
3
5
,7
3
0
-
-
74,822
(1,766)
74,822
(
1
,7
6
6
)
510,552
433,964
74,822
(
1
,7
6
6
)
23
B
o
r
r
o
w
i
n
g
s
G
r
o
u
p
C
o
m
p
a
n
y
Short
term
-
falling
due
within
one
y
e
a
r
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Bank overdrafts
-
5
0
0
,2
0
5
-
5
0
0
,0
0
0
Bank
l
o
a
n
s
1,090,332
-
1,090,332
-
Total
short
term
b
o
r
r
o
w
i
n
g
s
1,0
9
0
,3
3
2
5
0
0
,2
0
5
1,0
9
0
,3
3
2
5
0
0
,0
0
0
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
7
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
2
3
B
o
r
r
o
w
i
n
g
s
(
C
o
n
t
i
n
u
e
d
)
Long
term
-
falling
due
after
one
y
e
a
r
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Bank
l
o
a
n
s
6,887,236
7,731,890
3,700,000
-
A
subsidiary
within
the
group
has
a
loan
of
€596,586
(2020
-
€1,908,000)
which
bears
interest
at
4%
per
annum
and
is
repayable
by
the
year
2022
from
sale
proceeds
of
immovable
properties.
Another
subsidiary
within
the
group
has
another
loan
of
€2,590,650
(2020
-
€5,823,890)
which
bears
interest
at
4.25%
per
annum
and is repayable by the year 2023 from sale proceeds of immovable properties.
The
parent
has
a
bank
loan
facility
of
€4,790,332
(
€1,090,332
is
short-term)
which
bears
interest
at
0.25%
(supported
by
the
Malta
Development
Bank).
This
is
repayable
by
the
year
2024
by
means
of
monthly
installments.
The facilities are secured by a general and special hypothecs on the immovable properties of the relative
s
u
b
s
i
d
i
a
r
i
e
s
.
Non-current
G
r
o
u
p
C
o
m
p
a
n
y
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
4.25%
Secured
Bonds
2
0
2
3
1
9
,2
4
7
,3
0
0
1
9
,2
4
7
,3
0
0
1
9
,2
4
7
,3
0
0
1
9
,2
4
7
,3
0
0
3.65%
Secured
Bonds
2
0
2
2
2
9
,1
1
8
,4
0
0
3
0
,3
6
7
,5
0
0
2
9
,1
1
8
,4
0
0
3
0
,3
6
7
,5
0
0
3.7%
Secured
Bonds
2023
-
2
0
2
5
2
1
,0
0
0
,0
0
0
2
1
,0
0
0
,0
0
0
2
1
,0
0
0
,0
0
0
21,000,000
6
9
,3
6
5
,7
0
0
70,614,800
69,365,700
7
0
,6
1
4
,8
0
0
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
the
effective
yield
method
as
f
o
l
l
o
w
s
:
Face
v
a
l
u
e
4.25%
Secured
Bonds
2
0
2
3
1
9
,2
4
7
,3
0
0
1
9
,2
4
7
,3
0
0
1
9
,2
4
7
,3
0
0
1
9
,2
4
7
,3
0
0
3.65%
Secured
Bonds
2
0
2
2
2
9
,1
1
8
,4
0
0
3
0
,3
6
7
,5
0
0
2
9
,1
1
8
,4
0
0
3
0
,3
6
7
,5
0
0
3.7%
Secured
Bonds
2023
-
2
0
2
5
2
1
,0
0
0
,0
0
0
2
1
,0
0
0
,0
0
0
2
1
,0
0
0
,0
0
0
21,000,000
6
9
,3
6
5
,7
0
0
70,614,800
69,365,700
7
0
,6
1
4
,8
0
0
Amortised
c
o
s
t
Issue
of
bond
c
o
s
t
s
1,1
8
1
,5
3
0
1,1
8
1
,5
3
0
1,181,530
1,181,530
Issue
of
bond
costs
a
m
o
r
t
i
s
e
d
(
8
1
7
,6
8
2
)
(
4
3
0
,8
8
7
)
(817,682)
(430,887)
3
6
3
,8
4
8
7
5
0
,6
4
3
3
6
3
,8
4
8
750,643
Amortised
c
o
s
t
6
9
,0
0
1
,8
5
2
69,864,157
6
9
,0
0
1
,8
5
2
69,864,157
The
effective
interest
rates
at
the
end
of
the
year
were
as
f
o
l
l
o
w
s
:
Face
v
a
l
u
e
2
0
2
1
2
0
2
0
Secured
Bonds
2
0
2
3
4.2
5
%
4.2
5
%
Secured
Bonds
2
0
2
2
3.6
5
%
3.6
5
%
Secured
Bonds
2023-
2
0
2
5
3.7
0
%
3.7
0
%
On
16
September
2016
GAP
Group
p.l.c.
issued
up
to
40,000,000
4.25%
Secured
Bonds
2023.
The
bond
interest
is
payable
annually
in
arrears
on
2
October.
The
bonds
are
guaranteed
by
an
equivalent
cash
amount
held
in
the
reserve
account.
The
bonds
have
been
admitted
to
the
Stock
exchange
on
26
October
2016.
The
quoted
market
price
as
at
31
December
2021
for
the
bonds
was
€101.50.
In
the
opinion
of
the
directors
these
market prices fairly represent the fair value of these financial liabilities.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
8
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
2
3
B
o
r
r
o
w
i
n
g
s
(
C
o
n
t
i
n
u
e
d
)
On
4
March
2019
GAP
Group
p.l.c.
issued
up
to
40,000,000
3.65%
Secured
Bonds
2022
of
a
nominal
value
of
€100
per
secured
bond
issued
at
PAR
through
the
combination
of
two
tranches.
The
bond
interest
is
payable
annually
in
arrears
on
4
April.
The
bonds
were
redeemed
at
par
on
4
April
2022.
The
bonds
were
guaranteed
by
GAP
Luqa
Limited
and
GAP
Mellieha
Limited,
which
have
bound
themselves
jointly
and
severally
for
the
payment
of
the
bonds
and
interest
thereon,
pursuant
to
and
subject
to
the
terms
and
conditions
in
the
Prospectus.
The
bonds
have
been
admitted
to
the
Stock
exchange
on
15
April
2019.
The
quoted
market
price
as
at
31
December
2021
for
the
bonds
was
€97.
In
the
opinion
of
the
directors
these
market prices fairly represent the fair value of these financial liabilities.
On
20
November
2020
GAP
Group
p.l.c.
issued
up
to
21,000,000
3.7%
Secured
Series
I
Bonds
2023-2025
of
a
nominal
value
of
€100
per
Series
I
Bond
issued
at
par.
The
bond
interest
is
payable
annually
in
arrears
on
17
December.
The
bonds
are
redeemable
at
par
and
are
due
for
redemption
at
any
date
falling
between
18
December
2023
and
17
December
2025,
at
the
sole
option
of
the
Issuer,
by
giving
not
less
than
30
days’
notice.
The
bonds
are
guaranteed
by
GAP
QM
Limited,
which
has
bound
itself
for
the
payment
of
the
bonds
and
interest
thereon,
pursuant
to
and
subject
to
the
terms
and
conditions
in
the
Prospectus.
The
bonds
have
been
admitted
to
the
Stock
exchange
on
17
December
2020.
The
quoted
market
price
as
at
31
December
2021
for
the
bonds
was
€101.
In
the
opinion
of
the
directors
these
market
prices
fairly
represent
the
fair
value
of these financial liabilities.
2
4
C
r
e
d
i
t
o
r
s
G
r
o
u
p
C
o
m
p
a
n
y
Trade
and
other
p
a
y
a
b
l
e
s
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
Trade creditors and accruals
7,5
3
7
,5
1
5
7,0
8
6
,1
7
1
1,0
3
3
,2
9
7
1,2
8
5
,9
4
0
Advance
deposits
received
on
promise
of
sale
a
g
r
e
e
m
e
n
t
s
2,2
2
5
,7
8
6
2,8
7
9
,8
7
1
-
-
Other
c
r
e
d
i
t
o
r
s
1,7
5
2
,7
0
0
-
1,7
5
2
,7
0
0
-
Other
t
a
x
a
t
i
o
n
54,956
36,910
-
-
1
1
,5
7
0
,9
5
7
1
0
,0
0
2
,9
5
2
2,7
8
5
,9
9
7
1,2
8
5
,9
4
0
Other
financial
l
i
a
b
i
l
i
t
i
e
s
Amounts
due
to
s
h
a
r
e
h
o
l
d
e
r
s
1,9
7
0
,9
3
7
6
5
7
,4
7
0
1,6
7
6
,6
9
0
1,4
0
8
,2
5
7
Amounts
due
to
s
u
b
s
i
d
i
a
r
i
e
s
-
-
68,745,251
3
1
,4
9
3
,8
6
5
1,9
7
0
,9
3
7
6
5
7
,4
7
0
7
0
,4
2
1
,9
4
1
3
2
,9
0
2
,1
2
2
Non-current
l
i
a
b
i
l
i
t
i
e
s
Minority
i
n
t
e
r
e
s
t
s
4,907
4,907
-
-
4,9
0
7
4,9
0
7
-
-
Total
trade
and
other
c
r
e
d
i
t
o
r
s
1
3
,5
4
6
,8
0
1
1
0
,6
6
5
,3
2
9
7
3
,2
0
7
,9
3
8
3
4
,1
8
8
,0
6
2
The
amounts
due
to
the
group
companies
and
the
related
parties
are
interest
free
and
repayable
on
d
e
m
a
n
d
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
3
9
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
2
5
Transactions
with
related
p
a
r
t
i
e
s
All
companies
forming
part
of
Gap
Group
p.l.c.
are
considered
by
the
directors
to
be
part
of
the
group
of
Companies.
Companies
having
the
same
shareholders
and
directors
are
considered
by
the
directors
to
be
related parties.
During the course of the year the company entered into transactions with related undertakings all of which
arise in the ordinary course of business. The related party transactions were :
G
r
o
u
p
C
o
m
p
a
n
y
Other
financial
a
s
s
e
t
s
Amounts
receivable
from
related
c
o
m
p
a
n
i
e
s
2
0
2
1
2
0
2
0
2
0
2
1
2
0
2
0
€
€
€
€
10,676,417
10,381,969
8,210,636
7,9
1
6
,1
8
8
Trade
and
other
r
e
c
e
i
v
a
b
l
e
s
Amounts
due
from
group
c
o
m
p
a
n
i
e
s
-
-
63,606,350
4
1
,0
8
6
,8
6
5
Amounts
due
from
related
c
o
m
p
a
n
i
e
s
6,523,208
3,577,216
822,367
7
2
,8
8
4
I
n
v
e
s
t
m
e
n
t
I
n
c
o
m
e
Interest
receivable
from
related
p
a
r
t
i
e
s
294,449
274,594
3,446,679
2,5
6
5
,6
7
0
Other
financial
l
i
a
b
i
l
i
t
i
e
s
Amounts due to shareholders
1,970,937
657,470
1,676,690
1,408,257
Amounts
due
to
s
u
b
s
i
d
i
a
r
i
e
s
-
-
68,745,251
3
1
,4
9
3
,8
6
5
2
6
Contingent
l
i
a
b
i
l
i
t
i
e
s
One
of
the
companies
within
the
Group,
Geom
Developments
Limited
is
involved
in
a
pending
court
case
which
might
lead
to
litigation
costs
amounting
to
circa
Eur75,000.
Consequently
this
was
disclosed
as
a
contingent liability.
As
at
31
December
2021,
the
Group
had
bank
guarantees
amounting
to
€233,702
in
favour
of
third
p
a
r
t
i
e
s
.
GAP GROUP p.l.c.
Annual
Report
and
Consolidated
Financial
Statements
for
the
year
ended
31st
December
2
0
2
1
Page
4
0
.
NOTES
TO
THE
FINANCIAL
STATEMENTS
-
31st
DECEMBER
2
0
2
1
2
7
Capital
c
o
m
m
i
t
m
e
n
t
s
As
at
December
2021,
the
company
has
entered
into
promise
of
sale
agreements
with
advance
deposits
amounting
to
€2,225,786
(2020
-
€2,879,871).
These
agreements
are
expected
to
generate
sales
amounting
to €22,257,860 (2020
- €28,798,710).
2
8
Statutoryi
n
f
o
r
m
a
t
i
o
n
Gap
Group
p.l.c.
is
a
limited
liability
company
and
is
incorporated
in
Malta,
with
its
registered
address
at
Gap
Holdings Head Office, Censu Scerri Street, Tigne, Sliema Slm 3060.
The
parent
company
of
Gap
Group
p.l.c
is
Gap
Group
Investments
II
Limited,
a
company
registered
in
Malta,
with its registered address at Gap Holdings Head Office, Censu Scerri Street, Tigne, Sliema Slm
3
0
6
0
.
There
is
no
ultimate
controlling
party
as
none
of
the
shareholders
hold
more
than
50%
of
the
voting
shares
in the company.
2
9
C
o
m
p
a
r
a
t
i
v
e
i
n
f
o
r
m
a
t
i
o
n
Comparative figures in the main components of the financial statements have been reclassified to confirm
with the current year's presentation format for the purposes of fairer presentation.
To
the
Shareholders
of
Gap
Group
p.l.c.
Report on the Audit of the Financial Statements for the year ended 31st December 2021.
Opinion
I have audited the parent company financial statements and the consolidated financial statements (the “financial statements”) of Gap Group plc (the “Company”) and its subsidiaries (together, the “Group”), set on pages 9 to 40 which comprise the statement of financial position as at 31st December 2021 and the statement of comprehensive income, 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 significant accounting policies.
In my opinion, the accompanying financial statements give a true and fair view of the financial position of Gap Group p.l.c. and its Group as at 31st December 2021, and of the Company’s and its Group’s financial performance and its 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).
My opinion on the audit of the financial statements is consistent with the additional report to the audit committee.
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 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.
To the best of my knowledge and belief I have not provided any of the prohibited services as set out in the Accountancy Profession Act.
My audit approach
Overview
•
Overall materiality - €501,165 (1% of the consolidated turnover)•
Key audit matter - Valuation of InventoryScope 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. 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.
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, the accounting processes and controls, and the industry in which the company operates.
Independent auditor's report
To
the
Shareholders
of
Gap
Group
p.l.c.
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 €501,165 which represents 1% of the consolidated turnover. I chose total turnover 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 €501,165 as well as misstatements below that amount that, in my view, warranted reporting for qualitative reasons.
Key Audit Matter
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 matter indentified was :
Valuation of inventory
The Group consists of companies holding immovable property for development and resale. Three bonds were issued to the public to enable the Company to acquire shares of property development companies and to provide further finance to the group companies to carry on further development. At 31st December 2021, the carrying amount of immovable property held by the Group as inventory represented 41% of total assets.
At Company level, the carrying amount of inventory represents the cost of the land, development costs and borrowing costs.
At Group level, the acquisition method of accounting is applied to account for business combinations. Identifiable assets and liabilities assumed by the business combination are therefore initially measured at their fair values at the acquisition date. Therefore, at consolidated group level, inventory cost represents the fair value of inventory held by the acquired subsidiary as at date of acquisition of subsidiary, together with additional development and borrowing costs incurred following date of acquisition.
The carrying value of inventories as at 31st December 2021 is explained in note 16 which discloses the composition of the Inventories, including the fair value adjustment on the acquisition of subsidiaries. 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.
My other 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.•
An assessment was made of the reasonableness of cost of property reversed from inventory upon the sale of property.•
Audit procedures carried out in relation to net realisable value included a comparison of estimated selling price to recentmarket transactions and to similar property on the market and an assessment of the reasonableness of estimated costs to completion.
•
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 statementsBased on my audit work we concluded that the inventories were fairly stated.
Independent auditor's report
To
the
Shareholders
of
Gap
Group
p.l.c.
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 we 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 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 has 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
To
the
Shareholders
of
Gap
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 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 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 ability to continue as a going concern and future events or conditions may cause the company 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.
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 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.
Independent auditor's report
To
the
Shareholders
of
Gap
Group
p.l.c.
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 Gap Group plc p.l.c. for the year ended 31 December 2021, 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 containing the consolidated financial statements in compliance with the ESEF regulatory technical standard;•
Examining whether the Annual Financial Report including the consolidated financial statements has been prepared in accordance with the ESEF regulatory technical standard.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 2021 has been prepared in accordance with the ESEF RTS in all material aspects.
Report on Directors’ report
With respect to the Directors’ report, I also considered whether the Director’s 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; and•
I have nothing to report in relation to the statement on going concernIn the light of the knowledge and understanding of the company and its 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.
Independent auditor's report
To
the
Shareholders
of
Gap
Group
p.l.c.
Report on Other Legal and Regulatory Requirements (continued)
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 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 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 corporate governance procedures, or its risk and control procedures.
In my opinion, the Statement of Compliance set out on pages 6 to 8 has been properly prepared in accordance with the requirements of Listing Rules issued by the Malta Listing Authority.
Report on Other matters which we are required to report by exception
I am also responsible under the Companies Act (Cap. 386), to report to you if, in my opinion:
The information given in the Report of the Directors is not consistent with the financial statement
•
Adequate accounting records have not been kept, or that returns adequate for my audit have not been received from 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
Independent auditor's report
To
the
Shareholders
of
Gap
Group
p.l.c.
Appointment
I was first appointed as auditor of the company for the year ending 31 December 2020. My appointment was renewed by the shareholder resolution. The company was listed on a regulated market on 26 October 2016.
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:25 April 2022