Published: 2020-04-22 09:39:25 CEST
UPP Olaines
Quarterly report

UPP Olaines OÜ consolidated unaudited financial results for first quarter of 2020

MANAGEMENT REPORT FOR 3 MONTHS 2020

General information

UPP Olaines OÜ (hereafter ‘the Company’ and ‘Group’ when referred together with subsidiaries) was established for the purpose of funding, acquiring and managing the real estate investment of Olaines Logistics Park: (buildings and land) located at “Šarlotes”, Olaines county, Olaines parish, Latvia, cadastre number 8080 003 0029, registered in the Land Register compartment No.5439 of the city of Olaine parish. The Company was established on 24.08.2017 and had no economic activity until 15.12.2017, when it acquired the cold storage warehouse Olaines Logistics Park.

The business performance is not affected by seasonal factors. The activities of the Company have no environmental or social impact.

As the Company has been established solely for the purpose of funding, acquiring and managing the property, no strategic changes in the business are planned.

UPP Olaines OÜ is operating based on going concern.

The impact of COVID-19 on the Company’s economic activity

The novel coronavirus outbreak started in early 2020 and caused a global economic downturn in March 2020. The COVID-19 also reached the Baltic states, causing border closures for foreign nationals, school closures and panic shopping for consumer stapels. The full effect of the economic downturn caused by the pandemic remains to be seen.

The Company’s economic activities for the reporting period have not been affected by the virus outbreak. The Management Board's best estimate is that, in the event that the outbreak of the virus and the resulting economic downturn do not materially worsen, the effect of these circumstances on the Company's financial performance will be moderate, due to the industry the Company's property leasing companies are operating in.

Financial commentary for the first quarter of 2020

Net rental income was 657 214 euros for the first quarter of 2020, which is in line with the net rental income of 649 713 euros for the first quarter of 2019.

Operating profit was 619 887 euros for the first quarter of 2020, decreased by 3.8% from 644 147 euros for the first quarter of 2019. The decrease in operating profit was caused by increased management costs.

Net income was 329 107 euros for the first quarter of 2020, increased by 23% from 267 473 euros for the first quarter of 2019. The increase in net income for the reporting period was caused by the reduced financial costs compared with first quarter of 2019, where the adjustments of fair value of the interest rate swap contract had a negative impact on the financial expenses.

Merger of SIA Olaines Logistics and SIA Olaines Logistics Parks

On January 22nd 2020 the subsidiaries SIA Olaines Logistics and SIA Olaines Logistics Parks were merged. The merger was planned and part of normal management of the business, referred to also in the note issue terms and conditions. The merger took somewhat longer due to the peculiarities of the Latvian legislation. The merger will further increase the efficiency of the Company’s operations and management. The new Group structure is found in Note 1.

Key indicators of financial performance and position for 3 months 2020

(in EUR)  Q1 2020Q1 2019
Net rental income  657 214649 713
Operating profit  619 887644 147
Profit for the period  329 107267 473


(in EUR)31.03.202031.03.2019
Investment property  30 909 000 30 762 000
Interest-bearing loans 28 226 63229 390 632
Interest-bearing loans less shareholder loan25 278 33226 342 332


 Q1 2020Q1 2019
Net profit margin (Total comprehensive income for the period / Net rental income)49%41%
ROA (Net profit for the period / Average total assets for the period)1,04%0,85%
DSCR (Operating profit / Loan principal and interest payments on interest-bearing loans)  1,2 1,1


CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

Condensed consolidated interim statement of comprehensive income

(in EUR)Note    Q1 2020Q1 2019
Net rental income5  657 214649 713
Net rental income   657 214649 713
      
General and administrative expenses   (37 327) (5 566)
Operating profit   619 887644 147
      
Financial income / (cost)     (290 780) (376 674)
Profit before income tax   329 107267 473
Income tax   00
Profit for the period   329 107267 473
      
Total comprehensive income for the period   329 107267 473


Condensed consolidated interim statement of financial position

(in EURNote31.03.202031.03.2019
Cash and cash equivalents 534 344523 170
Trade and other receivables 313 568281 913
Total current assets 847 912805 083
    
Investment property 30 909 00030 762 000
Total non-current assets 30 909 00030 762 000
TOTAL ASSETS 31 756 91231 567 083
    
Trade and other payables 379 344450 946
Financial derivatives 448 432488 313
Loans and borrowings61 064 0041 064 000
Total current liabilities 1 891 7802 003 259
    
Loans and borrowings627 162 62828 326 632
Total non-current liabilities 27 162 62828 326 632
TOTAL LIABILITIES 29 054 40830 329 891
    
Share capital 2 5002 500
Retained earnings 2 700 0041 234 692
TOTAL EQUITY 2 702 5041 237 192
    
TOTAL EQUITY AND LIABILITIES 31 756 91231 567 083


More information:

Siim Sild

Director

+372 5626 0107

siim.sild@unitedpartners.ee

Attachment


Olaines Q1 report 2020 ENG 21.04.2020.pdf