Annual / Quarterly Financial Statement • Jul 29, 2022
Annual / Quarterly Financial Statement
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prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union for the year ended 31 December 2021 and Independent auditor's report
| CONTENTS | ||
|---|---|---|
| BOARD OF DIRECTORS AND OTHER OFFICER | ||
| DECLARATION OF THE MEMBERS OF THE BOARD OF DIRECTORS AND OTHER RESPONSIBLE PERSONS | ||
| FOR THE PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS | ||
| MANAGEMENT REPORT | ||
| INDEPENDENT AUDITOR'S REPORT | ||
| CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME14 | ||
| CONSOLIDATED STATEMENT OF FINANCIAL POSITION | ||
| CONSOLIDATED STATEMENT OF CHANGES IN EQUITY | ||
| CONSOLIDATED STATEMENT OF CASH FLOWS | ||
| NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS | ||
| General information on the Group | ||
| Economic environment in which the Group operates | ||
| Basis of preparation General provisions |
||
| Principles of consolidation | ||
| Going concern | ||
| Functional and presentation currency | ||
| Impact of effective changes in International Financial Reporting Standards | ||
| Significant accounting estimates and professional judgment | ||
| Accounting policies | ||
| 1. | Retrospective restatements | |
| 2. | Revenue | |
| 3. | Cost of Sales | |
| 4. | Selling and marketing expenses | |
| 5. | General administrative expenses | |
| 6. | Other income | |
| 7. | Other losses | |
| 8. | Financial income and financial expenses | |
| 9. | Property, plant and equipment | |
| 10. | Goodwill and test of non-current assets for impairment Investments in associated companies |
|
| 11. | .39 | |
| 12. | Other intangible assets Advances paid |
|
| 13. | Inventories | |
| 14. 15. |
Other receivables | |
| 16. | Trade receivables | |
| 17. | Loans to related parties | |
| 18. | Capital in partnerships | |
| 19. | Financial assets through profit or loss | |
| 20. | Cash and cash equivalents | |
| 21. | Share capital and additional paid-in capital | |
| 22. | Loans and borrowings | |
| 23. | Short-term accounts payable | |
| 24. | Other liabilities | |
| 25. | Income tax | |
| 26. | Right-of-use assets and lease obligations | |
| 27. | Related parties | |
| 28. | Earnings per share | |
INTRAWARE GROUP Consolidated financial statements for the year ended 31 December, 2021 in thousand EUR, unless otherwise stated
| 29. Operating segments | |
|---|---|
| 30. Business combinations | |
| 31. Joint venture in the form of joint operation | |
| 32. Financial risks management | |
| 33. Fair value of financial instruments | |
| 34. Contingencies and commitments | |
| 35. Subsequent events |
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20 m p. Dansk raj
Board of Directors:
Myrianthi Petrou Andreas Christofi Andreas Konialis Vitaly Halblau
Company Secretary:
Independent Auditors:
Virna Secretarial Services Ltd
Eurofast Audit Ltd Certified Public Accountants and Registered Auditors 117 Strovolos Avenue Office 201 2042 Nicosia Cyprus
Registered office:
Bankers:
Arsinois 12A Strovolos 2006 Nicosia Cyprus
Eurobank Cyprus Ltd Vontobel
Registration number:
HE292020
In accordance with Article 9 sections (3c) and (7) of the Transparency Requirements (Traded Securities in Regulated Markets) Law 2007 (N 190 (É)/2007) ("the Law") and with Article 140(1) of the Laws and Regulations of the Cyprus Stock Exchange we, the members of the Board of Directors and the other responsible persons are solely responsible for the consolidated financial statements of Intraware Investments Public Ltd (the "Company") for the year ended 31 December 2021 and on the basis of our knowledge, declare that:
(a) The annual consolidated financial statements which are presented on pages 14 to 61:
(i) have been prepared in accordance with the applicable International Financial Reporting Standards as adopted by the European Union and the provisions of Article 9, section (4) of the Law, and
(ii) provide a true and fair view of the particulars of assets and liabilities, the financial position and profit or loss of the Group and the entities included in the consolidated financial statements as a whole and
b) The Management report provides a fair view of the developments and the performance as well as the financial position of the Group as a whole, together with a description of the main risks and uncertainties which they face.
Members of the Board of Directors:
Myrianthi Petrou
Andreas Christofi
Nicosia, 13 July 2022
The Board of Directors presents its report and audited consolidated financial statements of the Group for the year ended 31 December 2021.
The principal activities of Intraware Investments Public Limited (the Company) are the holding of investments (the Group) and trademarks.
The principal activities of the Group, which remain unchanged from last year, are wellness and fitness services.
The Group's results for the year are set out in the consolidated financial statements. The net profit for 2021 year amounts to EUR 3 346 thousand (2020: loss EUR (721) thousand / restated/).
The Company's development to date, financial results and position as presented in the financial statements are considered satisfactory. The main risks and uncertainties faced by the Group and the steps taken to manage these risks, are described in note 32 of the consolidated financial statements and in chapter Going concern.
The Company recognises the importance of implementing sound corporate governance policies, practices and procedures. As a company listed on the Cyprus Stock Exchange (CSE), Intraware Investments Public Ltd has adopted CSE's Corporate Governance Code and applies its principles.
The Company had no capital or other commitments as at 31 December 2021 and as at 31 December 2020.
In 2021 year, the Board of Directors approved the payment of dividend for EURO 3 333 thousand out of the profits of previous years (2020: EUR 2 040 thousand).
There were no changes in the share capital of the Company during 2020-2021 years.
On 15 January 2016, the Cyprus Stock Exchange announced the listing on the CSE Emerging Companies Market of 40 000 ordinary nominal shares of the Company, of a nominal value of $E1$ , at a listing price of $\epsilon$ 3 104,00, pursuant to Article 58(1) of the CSE Law. The trading of the shares, started on Monday, 18 January 2016. The Cyprus Stock Exchange undertook to keep the registry of the Company at the CSE Central Depository / Registry.
The members of the Company's Board of Directors as at 31 December 2021 and at the date of this report are presented on page 5. All of them were members of the Board of Directors throughout the year ended 31 December 2021. Mr. Vitali Halblau was appointed on 5 March 2021.
In accordance with the Company's Articles of Association all Directors presently members of the Board continue in office.
There were no significant changes in the assignment of responsibilities and remuneration of the Board of Directors.
There were no material events after the reporting period other than those described in note 35 of these consolidated financial statements.
The Independent Auditors, Eurofast Audit Ltd, have expressed their willingness to continue in office and a resolution giving authority to the Board of Directors to fix their remuneration will be proposed at the Annual General Meeting.
The Directors are responsible for the accuracy and completeness of the consolidated financial statements prepared in compliance with International Financial Reporting Standards (IFRS) as adopted by the European Union and the requirements of Cyprus Company Law, Cap. 113, that fairly present the financial position of the Group as at 31 December 2021, and the results of its operations, cash flows and changes in equity for the year then ended.
In the preparation of these consolidated financial statements, the Directors of the Group are responsible for:
The Directors of the Group are also responsible for:
maintaining proper accounting records that disclose the financial position of the Group with reasonable accuracy and at any time, and which enable them to ensure that the consolidated financial statements of the Group comply with IFRS;
maintaining statutory accounting records in compliance with Russian legislation and accounting $\mathbf{a}$ standards;
On 13 July 2022 the Board of Directors of Intraware Investments Public Ltd authorized these consolidated financial statements for issue.
By order of the Board of Directors, and the contractors of the Board of Directors,
Myrianthi Petrou
Director
Nicosia, 13 July 2022
the fighter file of the construction of the fields are exampled in forms second of the composition that
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www.eurofastaudit.com
Report on the Audit of the Consolidated Financial Statements
We have audited the accompanying consolidated financial statements of Intraware Investments Public Ltd (the "Company"), which comprise the consolidated statement of financial position as at 31 December 2021, and the consolidated statements of profit or loss and other comprehensive income, changes in equity and cash flows for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying consolidated financial statements give a true and fair view of the consolidated financial position of the Group as at 31 December 2021, and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and the requirements of the Cyprus Companies Law, Cap. 113.
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Company 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 our audit of the financial statements in Cyprus, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We draw attention to notes in page 21 Economic Environment in which the Group operates and Basis of preparation (Going concern), of the consolidated financial statements which refers to the significant uncertainty of the Cyprus and Russian economy due to the COVID-19 global outbreak. These adverse economic developments may adversely affect the operations, profitability and liquidity of the Company, however these developments cannot be determined with certainty at this stage. Our opinion is not qualified in respect of this matter.
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial statements of the current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. In addition to the matter described in the Material Uncertainty Related to Going Concern section, we have determined the matters described below to be the key audit matters to be communicated in our report.
Goodwill is the excess of the purchase price over the fair value of the acquirer's share in the identifiable assets, liabilities and contingent liabilities of the acquired subsidiaries or associates at the acquisition date. Goodwill is initially recognized at cost less accumulated impairment losses, if any.
Audit
www.eurofastaudit.com
Goodwill is the most significant intangible assets of the Group. Goodwill was formed when the businesses were acquired in 2015 (see IV Relevant disclosures, note 10). The group tests whether goodwill has suffered any impairment on an annual basis.
Other intangible assets consist of customer relationships representing future benefits from loyal customers in connection with expected purchases of cards, relating services and food (see IV Relevant disclosures, note 12). Intangible assets are initially recognized at fair value at the acquisition date are subsequently carried at cost less accumulated amortization and impairment losses.
Our audit procedures included, among others, evaluating the impairment testing of goodwill carried out by the Group as well as the assumptions and methodologies used, in particular those relating to the forecasted revenue growth and profit margins for the valuation of other intangible assets.
The most important source of revenue of the Group is derived from clubs cards sales and sport services rendered. A clubs card can be less or more than one year membership. It provides a pre-agreed range of services, which are included in the card value. Revenue from services rendering is recognized by the Group in the accounting period in which the services are rendered (see IV Relevant disclosures, note 2). Amounts received from customers as payments for future services (including cards for sport services) are initially recognized as deferred revenue and are amortized with recognition of revenue in proportion to rendering of services.
Our audit procedures included, among others, evaluating the business model and methodology used by the Group to recognise revenue in the appropriate period to which it relates to as per the requirements of the applicable IFRS.
Borrowings are represented mainly by loans from related parties (see IV Relevant disclosures, note 22). Due to the steady mutually beneficial relations between the parties concerned these liabilities are not subject to immediate repayment and do not have a significant impact on the financial position of the Group.
Our audit procedures included, among others, assessment and evaluation of the existence, rights and obligations, as well as the valuation of the carrying value of borrowings included in these consolidated financial statements which are consistent with the going concern basis of preparation.
Andr
www.eurofastaudit.com
Key audit matter
The group companies and Intraware Investments Public Ltd had the license agreements valid in the audited period, according to which Intraware Investments Public Ltd granted to the group companies non-exclusive rights for the trademark and know-how along with monthly payments. In view of the epidemic environment and business restrictions in 2020 Intraware Investments Public Ltd and the group companies entered into additional agreements, according to which the group companies were free of payments for the period from April 01 through June 30, 2020.
Our audit procedures included, among others, the review of accounting records, to check that no income was recognized for that period.
The Board of Directors is responsible for the other information. The other information comprises the information included in the management report and the additional information to the consolidated statement of profit or loss and other comprehensive income in pages 34 to 38, but does not include the consolidated financial statements and our auditor's report thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
The Board of Directors is responsible for the preparation of consolidated financial statements that give a true and fair view in accordance with International Financial Reporting Standards as adopted by the European Union and the requirements of the Cyprus Companies Law, Cap. 113, and for such internal control as the Board of Directors determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, the Board of Directors is responsible for assessing the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.
The Board of Directors is responsible for overseeing the Group's financial reporting process.
www.eurofastaudit.com
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Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
We communicate with the Board of Directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide the Board of Directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
www.eurofastaudit.com
From the matters communicated with the Board of Directors, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Pursuant to the additional requirements of the Auditors Law of 2017, we report the following:
This report, including the opinion, has been prepared for and only for the Company's members as a body in accordance with Section 69 of the Auditors Law of 2017 and for no other purpose. We do not, in giving this opinion, accept or assume responsibility for any other purpose or to any other person to whose knowledge this report may come to.
The engagement partner on the audit resulting in this independent auditor's report is Mrs. Agathi Lambrou.
Agathi Lambrou
Certified Public Accountant and Registered Auditor for and on behalf of
Nicosia, 13 July 2022
| Note | 2021 | 2020 | |
|---|---|---|---|
| (restated) | |||
| Revenue | $\overline{2}$ | 38 348 | 26 134 |
| Cost of Sales | 3 | (24817) | (21038) |
| Gross profit | 13531 | 5096 | |
| Selling and marketing expenses | 4 | (3036) | (1553) |
| Administrative expenses | 5 | (4391) | (3448) |
| Other income | 6 | 1802 | 3 2 2 9 |
| Other losses | 7 | (1355) | (2022) |
| Operating income | 6551 | 1302 | |
| Financial income | 8 | 626 | 1 1 35 |
| Financial expenses | 8 | (3594) | (3778) |
| Profit before tax | 3583 | (1341) | |
| Income tax expense/gain | 25 | (237) | 620 |
| Profit for the year from continuing operations | 3 3 4 6 | (721) | |
| Net profit for the year | 3 3 4 6 | (721) | |
| Net profit/(loss) for the year attributable to: | |||
| Owners of the Group | 3482 | (473) | |
| Non-controlling interests | (136) | (248) | |
| Total profit for the year | 3 3 4 6 | (721) | |
| Earnings per share from continuing operations | |||
| (basic and diluted), EUR | 87,05 | (11, 83) | |
| Other comprehensive income for the year Items that may not be reclassified subsequently to profit or loss: |
|||
| Foreign currency translation differences | (332) | 602 | |
| Comprehensive income attributable to: | |||
| Owners of the Group | 28 | 3 2 8 5 | 566 |
| Non-controlling interests | (271) | (685) | |
| Total comprehensive income for the vear | 3014 | (119) |
The notes on pages 20 to 61 are an integral part of these consolidated financial statements.
On 13 July 2022 the Board of Directors of Intraware Investments Public Ltd authorized these financial statements for issue.
Director
Director
Myrianthi Petrou
Andreas Christofi
OF INTRAWARE GROUP AS AT 31 DECEMBER 2020
| (in thousand EUR) | |
|---|---|
| ------------------- | -- |
| Note | 2021 | 2020 (restated) |
||
|---|---|---|---|---|
| Non-current assets | ||||
| Property, plant and equipment | 9 | 4977 | 2877 | |
| Right-of-use assets | 26 | 36 691 | 18 475 | |
| Goodwill | 10 | 4 0 0 1 | 3811 | |
| Other intangible assets | 12 | 835 | 716 | |
| Investments in associated companies | 11 | 261 | 100 | |
| Loans granted to shareholders | 17 | 2 2 8 6 | ||
| Capital in partnerships | 18 Plug And A | 774 | 665 | |
| Other non-current assets | neu podinim monitor ortagos. | 256 | ||
| Deferred tax assets | 25 | 1 4 0 4 | 1 0 38 | |
| Total non-current assets | 48 943 | 30 224 | ||
| atanya masukata ing k | ||||
| Current assets | ||||
| Advances paid | 13 | 10 909 | 4 0 71 | |
| Inventories | 14 | 334 | 271 | |
| Other receivables | 15 | 2 1 5 7 | 467 | |
| Other assets | 463 | 173 | ||
| Income tax overpayment | onana oa basek een | 176 | 97 | |
| Trade receivables | 16 | 1029 | 1966 | |
| Loans granted to shareholders | 17 | Johannas nuo | 272 | 1016 |
| Loans granted to other parties | 202 | 5656 | ||
| Financial assets through profit or loss | 19 | 3 3 9 4 | 4 1 7 4 | |
| Cash | 20 | 1 0 2 3 | 1525 | |
| Total current assets | 19 959 | 19416 | ||
| TOTAL ASSETS | 68 902 | 49 640 |
The notes on pages 20 to 61 are an integral part of these consolidated financial statements.
On 13 July 2022 the Board of Directors of Intraware Investments Public Ltd authorized these financial statements for issue.
Director
Director
Myrianthi Petrou
Andreas Christofi
(in thousand EUR)
| Note | 2021 | 2020 (restated) |
||
|---|---|---|---|---|
| Owners' equity | ||||
| Share capital | 21 | 40 | 40 | |
| Translation reserve | 21 | 477 | 674 | |
| Additional paid-in capital | 21 | 222 | 222 | |
| Other reserves | 255 | 255 | ||
| Accumulated profit (loss) | (14027) | 2 0 0 8 | ||
| Current year profit | 3482 | (472) | ||
| Equity attributable to owners of the Group | (9551) | 2727 | ||
| Non-controlling interest | 154 | 233 | ||
| TOTAL EQUITY | (9397) | 2960 | ||
| Non-current liabilities | ||||
| Long-term lease liabilities | 26 | 33 138 | 15549 | |
| Long-term payables other | 598 | 515 | ||
| Deferred tax liabilities | 25 | 14 | 152 | |
| Total non-current liabilities | 33750 | 16 216 | ||
| Current liabilities | 189-51 r. hr | |||
| Short-term loans and borrowings | 22 | 728 | -48. | 3 1 3 6 |
| Short-term lease liabilities | 26 | 9585 | 5 1 8 5 | |
| Short-term other payables | 23 | Little Mail 3928 |
4 9 9 1 | |
| Other liabilities | 24 | ning pada s 1 3 5 4 |
449 | |
| Liabilities to owners | 27 | 886 3. SAME I SAME IS ELECTRO |
382 | |
| Deferred revenue on club cards sold | 28 068 | 16 321 | ||
| Total current liabilities | 44 549 | 30 4 64 | ||
| TOTAL EQUITY AND LIABILITIES | 68 902 | 49 640 |
The notes on pages 20 to 61 are an integral part of these consolidated financial statements.
On 13 July 2022 the Board of Directors of Intraware Investments Public Ltd authorized these financial statements for issue.
Director
Director
Myrianthi Petrou
Andreas Christofi
OF INTRAWARE GROUP FOR THE YEAR ENDED 31 DECEMBER 2021
| (in thousand EUR) | Share capital |
Additional paid-in capital |
Other reserves |
Transla tion reserve |
Accumulat ed profit $(\text{loss})$ |
Non- controlli ng interests |
Total |
|---|---|---|---|---|---|---|---|
| For the year ended 31.12.2019 |
40 | 222 | 255 | (365) | 6 104 | 918 | 7174 |
| Dividends | (2040) | (2040) | |||||
| Acquisitions | |||||||
| Disposal | (2056) | (2056) | |||||
| Current year profit Foreign |
The Take Lat | (472) | (248) | (720) | |||
| currency translation differences |
1 0 39 | (437) | 602 | ||||
| For the year ended 31.12.2020 (restated) |
40 | 222 | 255 | 674 | 1536 | His arm to france and 233 |
2960 |
| put to brown was bod it should | |||||||
| Dividends Business |
where $\frac{1}{2}$ is the short if see $(3.333)$ | (3333) | |||||
| acquisitions under common control - |
$-10.1$ | (12039) | (12039) | ||||
| new components Business |
결정에 가장하면 그렇게도 얼굴을 잘 먹는 말도 하고 말고 있었다. | ||||||
| acquisitions under common control - increase of share |
concert was done pade "I parefissement pade) in progetting (192) |
192 | |||||
| Current year profit | fan philiseacht in Indian an S | 3482 (136) |
3 3 4 6 | ||||
| Foreign currency | e digithe prile and men | ||||||
| translation adjustments |
(197) | (135) | (332) | ||||
| For the year ended 31.12.2021 |
40 | 222 | 255 | 477 | (10546) 154 |
(9397) |
The notes on pages 20 to 61 are an integral part of these consolidated financial statements.
On 13 July 2022 the Board of Directors of Intraware Investments Public Ltd authorized these financial statements for issue.
Director
Director
Myrianthi Petrou
Andreas Christofi
Page 17 of 61
OF INTRAWARE GROUP FOR THE YEAR ENDED 31 DECEMBER 2021
(in thousand EUR)
| Note | 2021 | 2020 (restated) |
|
|---|---|---|---|
| Cash flows from operating activities | |||
| Profit before tax | 3583 | (1341) | |
| Amortisation of intangible assets | 12 | 302 | 468 |
| Depreciation of property, plant and equipment and | 9 | ||
| right-of-use assets | 4 0 5 5 | 4 4 8 2 | |
| Interest expense | 8 | 3594 | 3778 |
| Interest income | 8 | (555) | (1115) |
| Foreign exchange differences (net) | 6,7 | (275) | 108 |
| Impairment / (reversal) of impairment loss on trade and other receivables |
6 | 1677 | |
| Income from forgiven lease | (2599) | ||
| Impairment of property, plant and equipment and | |||
| intangible assets | 9,12 | ||
| Impairment of goodwill | 7, 10 | 106 | |
| Other non-cash expenses/(income) net | (302) | (109) | |
| Operating cash flows before working capital changes | 10508 | 7135 | |
| (Increase)/decrease in trade and other receivables | (7625) | 871 | |
| (Increase)/decrease in inventories | 14 | (63) | 122 |
| (Increase)/decrease in other assets | 779 | (866) | |
| Increase/(decrease) in trade and other payables | (979) | 1929 | |
| Increase/(decrease) in deferred revenue | 11746 | (1797) | |
| Increase/(decrease) in provisions | 1 0 8 6 | (24) | |
| Change in assets of acquired subsidiaries | 6 9 8 0 | ||
| Change in liability of acquired subsidiaries | (13486) | ||
| Cash generated from operating activities | 8 9 4 7 | 5 0 5 4 | |
| Income tax paid | (586) | (220) | |
| Interest paid | (3 257) | (3613) | |
| Net cash from operating activities | 5 104 | 1 2 2 1 | |
| Cash flows from investing activities | |||
| Purchase of property, plant and equipment | 9 | (1729) | (1646) |
| Purchase of intangible assets | (380) | ||
| Proceeds from sale of noncurrent assets | $6 -$ 20 |
300 | |
| Loans issued | (734) | (3338) | |
| Repayment of loans issued | 459 | 1468 | |
| Interest received | 108 | 82 | |
| Payment for acquisition of subsidiary, net of cash | |||
| acquired | 393 | ||
| Cash outflow due to disposal of subsidiaries |
INTRAWARE GROUP Consolidated financial statements for the year ended 31 December, 2021
in thousand EUR, unless otherwise stated
| (147) | ||
|---|---|---|
| Net cash used in investing activities | (1863) | (2590) |
| Cash flows from financing activities | ||
| Dividends paid to company's shareholders | (2314) | (2 119) |
| Proceeds of loans and borrowings | 1559 | 1 100 |
| Repayment of loans and borrowings | (1532) | (768) |
| Lease payments | (2809) | (332) |
| Net cash from financing activities | (5096) | (2119) |
| Cash and cash equivalents at the beginning of | ||
| the year 20 |
1525 | 2759 |
| Increase (decrease) of cash and cash equivalents | (1854) | (3488) |
| Translation differences | 1 3 5 2 | 2 2 5 4 |
| 20 Cash and cash equivalents at the end of the year |
1 0 23 | 1525 |
$\rightarrow$
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The notes on pages 20 to 61 are an integral part of these consolidated financial statements.
On 13 July 2022 the Board of Directors of Intraware Investments Public Ltd authorized these financial statements for issue.
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Intraware Investments Public Ltd (the "Company") and its subsidiaries (together with the Company, the "Group") is one of the largest chains of fitness clubs in Russian market of fitness services. Key activities of the Group are fitness clubs services to population, services of management of fitness clubs and additional activities (catering, retail of sport goods).
The subsidiaries are as follows:
| Name of the subsidiary | Russian City | Ownership interest 2021 |
Ownership interest 2020 |
|---|---|---|---|
| FOK "Altufevo Sport" LLC | Moscow | 100% | 98% |
| FOK "AK-Bars" LLC | Kazan | 98% | 98% |
| FOK "Volga-Fitnes" LLC | Volgograd | 100% mayor dan salat |
98% |
| FOK "Zchemchuzhina" LLC | Perm | 100% | 98% ublike e D |
| FOK "Marino" LLC | Moscow | 100% | 98% ant ant |
| FOK "Monarh" LLC | Moscow | 100% | 98% |
| FOK "Nagatinskaia" LLC | Moscow | 100% | 98% |
| FOK "Olimp" LLC | Voronezh | 100% | 98% |
| FOK "Park Pobedy" LLC | Moscow | 100% | 98% |
| FOK "Planeta" LLC | Moscow | 100% | 98% |
| FOK "Platinum" LLC | Voronezh | 100% | 98% |
| FOK "Rost Fitnes" LLC | Rostov-on-Don | 100% | 98% |
| FOK "Sam-Fitnes" LLC | Samara | 100% | 98% |
| FOK "Sun-City" LLC | Novosibirsk | 100% | 98% |
| FOK "Senator" LLC | Moscow | 100% | 98% |
| FOK "Arena" LLC | Kazan | 100% | 98% |
| FOK "Fusion" LLC | Moscow | 100% | 98% |
| FOK "Chistye Prudy" LLC | Moscow | 100% | 98% |
| FOK "Mosfilmovskiy" LLC | Moscow | 100% | 98% |
| "RTI-Finance" LLC | Moscow | 49% | 49% |
| "Sport Center" LLC | Moscow | 100% | 98% |
| FOK "Oktyabrskiy" LLC | Novosibirsk | 100% | 0% |
| FOK "Positiv" LLC | Moscow | 100% | 0% |
| FOK "Trud" LLC | Moscow | 100% | 0% |
| FOK "Chernavsky" LLC | Voronezh | 100% | 0% |
| FOK "62" LLC | Moscow | 100% | 0% |
| FOK "Vodny" LLC | Moscow | 100% | 0% |
| FOK "Deauville" LLC | Moscow | 100% | 0% |
| FOK "Solnechny" LLC | Moscow | 100% | 0% |
| FOK "Khotoshevsky" LLC | Moscow | 100% | 0% |
| FOK "64" LLC | Yekaterinburg | 100% | 0% |
| FOK "Novospassky" LLC | St. Petersburg | 100% | $0\%$ |
| FOK "63" LLC | Moscow region | 100% | $0\%$ | |
|---|---|---|---|---|
| FOK "Aviamotornaya" LLC | Moscow | 100% | h e ma | $0\%$ |
| FOK "Pravda" LLC | Moscow | 100% | 0% | |
| FOK "Primorsky" LLC | St. Petersburg | 100% | 0% |
During the period from October 5, 2021 till November 29, 2021 the Group obtained control over 14 fitness clubs:
There were no other changes in group structure during the year.
All the subsidiaries listed above are fitness clubs except «Sport Center» LLC which is a management company.
As at January 1, 2020 the Group has signed a contract with related party (shareholder of Intraware Investments Public Ltd) on transfer of decision-making rights over its subsidiary Bladesteel Limited (Cyprus). No remuneration has been received from the shareholder for this transfer of control. As a consequence, the Group has determined that it has ceased to have rights sufficient to give it power over the investee and has derecognised the assets and liabilities of the subsidiary with the net assets derecognized through equity.
Although the Group has less than 51% of charter capital of «RTI-Finance» LLC the Group has control over the entity through the appointment, based on agreement with existing shareholders, of directors having unlimited and full rights as to the operating, investment and financing activities of the Company. All significant actions of the entity are executed at the discretion of Company's Governing body.
Since January 2016 the Company is listed on the Cyprus Stock Exchange (Emerging Companies Market).
The Russian Federation displays certain characteristics of an emerging market. Its economy is particularly sensitive to oil and gas prices. The legal, tax and regulatory frameworks continue to develop and are subject to frequent changes and varying interpretations. Ongoing political tension in the region and international sanctions against certain Russian companies and individuals
continue to have a negative impact on the Russian economy.
In 2021, the continuing political tension in the region was exacerbated by further developments in the situation with Ukraine, which negatively impacted commodity and financial markets and increased volatility, especially in currency exchange rates. Since December 2021, the situation has continued to deteriorate and remains highly volatile. There is increased volatility in the financial and commodity markets. Additional sanctions and restrictions on business activities of organizations operating in the region are expected, as well as the consequences for the economy, the full range and possible consequences of which cannot be assessed.
In March 2020, the World Health Organization declared COVID-19 a global pandemic. In response to the pandemic, Russian authorities took the measures to contain the spread and mitigate the effects of COVID-19, such as banning and restricting travel, quarantine, self-isolation and limiting commercial activities, including the closure of companies. Some of the above measures were subsequently mitigated, but as of December 31, 2021, infection rates remained high, the vaccination rate was relatively low, and there was a risk that Russian government authorities would impose additional restrictions in subsequent periods, including as new virus varieties emerged.
In 2021, Russia's economy was showing positive signs of recovery from the pandemic. This was also facilitated by the recovery of the global economy and higher prices on global commodity markets. However, higher prices in some markets in Russia and around the world are also contributing to inflation in Russia.
The future effects of the current economic situation and the measures described above are difficult to predict and management's current expectations and estimates could differ from actual results
The Group uses confirmatory forecasting information, including macroeconomic projections, to estimate expected credit losses for loans, receivables and similar assets. However, as with any economic forecast, assumptions and their probability are inherently subject to high levels of uncertainty and, consequently, actual results may differ significantly from those projected.
The consolidated financial statements reflect management's assessment of the impact of the Russian business environment on the operations and the financial position of the Group. The future business environment may differ from management's assessment.
The consolidated financial statements of the Group have been prepared in accordance with International Financial Reporting Standards as adopted by the European Union (hereinafter - IFRS).
The companies of the Group maintain their accounting records in Russian Rubles in accordance with the Russian regulations on accounting and reporting. Russian accounting principles are significantly different from IFRS. In this regard, the financial statements that have been prepared in accordance with the Russian accounting standards have been adjusted to ensure that the consolidated financial statements comply with IFRS.
The consolidated financial statements have been prepared on a historical cost basis except when IFRS require the application of other basis of valuation.
The consolidated financial statements comprise the financial statements of Intraware Investments Public Ltd and its subsidiaries for the year ended 31 December 2021. Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.
Specifically, the Group controls an investee if, and only if, the Group has:
Generally, there is a presumption that a majority of voting rights results in control. To support this presumption and when the Group has less than a majority of the voting or similar rights of an investee, the Group considers all relevant facts and circumstances in assessing whether it has power over an investee, including:
The Group re-assesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control. Consolidation of a subsidiary begins when the Group obtains control over the subsidiary and ceases when the Group loses control of the subsidiary. Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated financial statements from the date the Group gains control until the date the Group ceases to control the subsidiary.
The purchase method of accounting is used to account for the acquisition of subsidiaries. The cost of an acquisition is measured at the fair value of the assets given up, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. The date of exchange is the acquisition date where a business combination is achieved in a single transaction, and is the date of each share purchase where a business combination is achieved in stages by successive share purchases.
The excess of the cost of acquisition over the acquirer's share of the fair value of the net assets of the acquire at each exchange transaction is recorded as goodwill. The excess of the acquirer's interest in the net fair value of the identifiable assets, liabilities and contingent liabilities acquired over cost is recognized immediately in profit or loss for the year.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured at their fair values at the acquisition date.
Inter-group transactions, balances and unrealized gains on transactions between group companies are eliminated; unrealized losses are also eliminated unless the cost of the corresponding asset cannot be recovered. The Company and all of its subsidiaries use uniform accounting policies consistent with the Group's policies.
A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an equity transaction.
If the Group loses control over a subsidiary, it derecognizes the related assets (including goodwill), liabilities, non-controlling interest and other components of equity, while any resultant gain or loss is recognized in profit or loss. Any investment retained is recognized at fair value.
The Group has prepared these consolidated financial statements based on the going concern
As at 31 December 2021 the Group's current liabilities exceed the current assets for the amount of EUR 24 590 thousand (as at 31 December 2020 - EUR 11 048 thousand). This fact indicates a material uncertainty that may raise significant doubt on the ability of the Group to continue as a going concern, as well as on the ability to realize its assets and repay its liabilities in the normal course of business.
At the same time, the Group has paid EUR 3 333 thousand as dividends in 2021 year (2020: EUR 2040 thousand) which had a significant impact on equity and financial position of the Group. The Board of Directors controls this outflow of resources and is able to temporarily cease declaring dividends should the need for this action in order to maintain appropriate levels of liquidity.
Movement restrictions and social distance measures introduced since the first quarter 2020, caused by the spread of the new coronavirus infection COVID-19 had a significant impact on the Group's performance. Fitness clubs in Russia were closed to visitors for a significant part of 2020. The negative effect can also be supplemented by the gradual introduction of additional requirements for self-isolation and the fear of customers to visit the objects with a large crowd of people. At the same time, with the opening of fitness clubs, the population that has come out of self-isolation is more likely to improve and maintain physical health and related services.
Managements reviewed the Group's current activities, including cash flow forecasts for the 12month period. As a result, the Group's management made a number of decisions, including reducing current expenses, reducing office staff, postponing a number of planned investment projects to open new fitness clubs, negotiating with lessors to reduce lease payments, negotiating with suppliers and contractors about deferring payments up to 6 months after resuming the activity of fitness clubs. The measures appeared to be effective.
At this stage, management cannot reliably estimate the future pace of recovery, and therefore considers various development scenarios to quickly adapt to changing needs and believes that the measures taken will enable the Group to fulfill its financial liabilities. Moreover, given the unpredictability of the duration and magnitude of the COVID-19 pandemic in the world, its actual impact on the Group's future profitability, financial position and cash flows may differ from current estimates and assumptions of management. In these circumstances, the Management believes that these consolidated financial statements have been properly prepared on a going concern basis.
The financial statements are presented in thousands of Euros, unless otherwise stated, which is the Company's presentation currency. The functional currency is the currency of the primary economic environment in which a company operates. The Russian subsidiaries' functional currency is the national currency of the Russian Federation, the Russian rubles. The functional currency of Cyprus' companies is Euro.
The results and financial position of the Company are translated into the presentation currency as follows:
(i) assets and liabilities for each statement of financial position presented are translated at the closing rate at the reporting date;
(ii) income and expenses for each statement of profit or loss and other comprehensive income are translated at average exchange rates; and
(iii) all resulting translation exchange differences are recognized as a separate component of equity as a cumulative translation reserve.
Monetary assets and liabilities denominated in foreign currency are translated into the functional currency at the official exchange rate of the Central Bank of Russia at the respective reporting dates. Foreign exchange gains and losses resulting from the settlement of transactions denominated in foreign currency and from the revaluation of monetary assets and liabilities denominated in foreign currency into RUB at the Central Bank's official year-end exchange rates are recognized in profit or loss. Revaluation at year-end rates does not apply to non-monetary items, including property, plant and equipment, equity components.
| Exchange rate at the end of the year | 2021 | 2020 |
|---|---|---|
| RUB to 1 US dollar | 74,2926 | 73,8757 |
| RUB to 1 Euro | 84,0695 | 90,6824 |
| Exchange rate average | 2021 | 2020 |
| RUB to 1 Euro | 87,0861 | 82,4488 |
The Company has adopted all new standards, interpretations and amendments to standards, effective from 1 January 2021 and are relevant to the operations of the Company. None of these interpretations and amendments to standards had significant impact on the Company's financial statements.
Several new standards and amendments to standards have been published that are mandatory for annual periods beginning on or after 1 January 2022, and which the Group has not early adopted:
Amendments to IFRS 10 and IAS 28 - «Investments in Associates and Joint Ventures» (issued on 11 September 2014 and effective for annual periods beginning on or after a date to be determined by the IASB);
IFRS 17, «Insurance Contracts» (issued on 18 May 2017 and effective for annual periods beginning on or after 1 January 2023);
Amendments to IFRS 17 and an amendment to IFRS 4 (issued on 25 June 2020 and effective for annual periods beginning on or after 1 January 2023);
Amendments to IAS 1 - «Classification of Liabilities as Current or Non-current» (issued on $\bullet$ 23 January 2020 and 15 July 2020 and effective for annual periods beginning on or after 1 January $2023$ ;
«Property, Plant and Equipment - Proceeds before Intended Use», «Onerous Contracts -Cost of Fulfilling a Contract», "Reference to the Conceptual Framework" - limited scope amendments to IAS 16, IAS 37 and IFRS 3, and the Annual Improvements to IFRS standards 2018-2020, relating to IFRS 1, IFRS 9, IFRS 16 and IAS 41 (issued on 14 May 2020 and effective for annual periods beginning on or after 1 January 2022);
Amendments to IAS 1 and IFRS 2: Disclosure of Accounting Policies (issued on 12 February 2021 and effective for annual periods beginning on or after 1 January 2023);
Amendments to IAS 8 - «Definition of Accounting Estimates» (issued on 12 February 2021, and effective for annual periods beginning on or after 1 January 2023);
Amendments to IFRS 16 - «COVID-19-Related Rent Concessions» (issued on 31 March 2021 and are effective for annual periods beginning on or after 1 April 2021);
Amendments to IAS 12 - «Deferred Tax related to Assets and Liabilities arising from a Single Transaction» (issued on 7 May 2021 and effective for annual periods beginning on or after 1 January 2023).
The Group is in the process of reviewing these standards and amendments to IFRS and does not expect any significant impact on its consolidated financial statements.
The Group makes estimates and assumptions that affect the reported amounts of assets and liabilities. Estimates and judgments are continually evaluated and are based on the management's experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Management also makes certain judgments, apart from those involving estimations, in the process of applying accounting policies. Judgments that have the most significant effect on the amounts recognized in the financial statements and estimates that can cause a significant adjustment to the carrying amount of assets and liabilities within the next financial year include:
Fair value of identifiable assets and liabilities acquired at business combination. As a $(1)$ result of the business combinations in current (see note 30) and previous periods the Group has acquired a pool of assets and liabilities. The measurement of fair value of identifiable assets and liabilities acquired, in particular in respect of Property, plant and equipment (see note 9) and Intangible assets (see note 12) required a significant use of judgment and assumptions, see relevant notes.
Impairment of intangible assets and other non-current assets. Intangible assets with $(2)$ indefinite useful life (see note 12) and goodwill (note 10) are reviewed for impairment at least once per year. The impairment test is performed using the discounted cash flows expected to be generated through the use of the intangible assets, using a discount rate that reflects the current market estimations and the risks associated with the asset or cash generating unit.
Transactions with related parties. In the normal course of business, the Group enters into $(3)$ transactions with related parties. Judgment is applied in determining whether the transactions are priced at market or non-market interest rates, where there is no active market for such transactions. The basis for judgment is pricing for similar types of transactions with unrelated parties and effective interest rate analysis. The conditions and terms of such operations are disclosed in note 27.
Useful lives of property, plant and equipment. Management assesses the remaining useful $(4)$ lives of property, plant and equipment (see note 9) at least once per year as at the financial year end. The useful lives are assessed in accordance with the assets' current technical conditions and the estimated period when these assets will bring economic benefit to the Group. Useful lives of the leasehold improvements are calculated based on residual lease terms according to the lease contracts (as at 31.12.2021 the average residual lease term was 8 years (as at 31.12.2020 - 7 years)) increased by lease prolongation that the management is certain of, and decreased by adverse possibilities: probability of the lessor to terminate the lease in case of the default of the, probability that the renegotiation of the lease will not be successful, probability that the Group will decide to discontinue the lease. The changes from the previous year's assessments, if any, are accounted for prospectively without restating comparatives.
$(5)$ Contingent liabilities valuation. The value of contingent liabilities is determined based on management's estimates, its interpretation of the relevant legislation and subsequent events. In particular, the Group recognizes provision for contingent liabilities if it is probable that its positions may be successfully challenged by tax authorities. As at 31.12.2021 and 31.12.2020 the Group estimates that its tax position is stable and no provisions have to be recognized (see further note 34).
Subsidiaries are those entities, including special purpose entities, controlled by the Group. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.
Property, plant and equipment are assets that comply with the requirements of IAS 16 "Property, Plant and Equipment". Property, plant and equipment are stated at historical cost less accumulated depreciation and accumulated impairment losses.
Historical cost of property, plant and equipment includes all expenditures that are directly attributable to its creation or acquisition including payments and payroll to sellers, contractors, other material and direct labor costs. Historical cost may also include purchase price, import duties and other taxes (except for those subsequently recoverable from the tax authorities) and also cost of transportation, handling and other costs directly attributable to the acquisition of the asset. Interests on borrowings are included in the cost of property, plant and equipment in cases when the requirements of IAS 23 "Borrowing Costs" are met.
The residual value of an asset corresponds to the expected value of the receipts, which the Group expects to receive from its disposal in the state and the age it will be at the end of its useful life, less the estimated costs of disposal of the asset. The residual value of the asset is nil if the Group expects to use the asset until the end of its useful life.
Depreciation is calculated using the straight-line method based on their estimated useful lives. Depreciation commences in the month following the month of the recognition of the property, plant and equipment in accounting.
The groups and the estimated useful lives of property, plant and equipment are as follows:
| Property, Plant & Equipment group | Useful life |
|---|---|
| Leasehold improvements function and during the most measure quar- |
Residual lease terms according to the lease contracts increased by one lease prolongation that the management is certain of and decreased by adverse possibilities. In practice average useful life approximates 9 years, maximum - 15 years |
| Sport equipment | 1-15 years, in practice 5 years on average |
| Office equipment | 1-10 years, in practice 3 years on average |
| Other property, plant & equipment | 2-25 years, in practice 6 years on average |
If a major component of an item of property, plant and equipment consists of several components with significantly different useful lives, they are recognized as separate items of property, plant and equipment.
Depreciation of an asset ceases at the earlier of two dates: the date of classification of assets as held for sale (or its inclusion in a disposal group classified as held for sale) in accordance with IFRS 5 "Non-current Assets Held for Sale and Discontinued Operations", and the date of derecognition. Depreciation does not cease when the asset becomes idle or is retired from active use.
The assets' depreciation methods, residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period and if current expectations differ from previous estimates, these changes shall be applied prospectively in accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors.
At each reporting date management assesses whether there is any indication of impairment of property, plant and equipment. If any such indication exists, management estimates the recoverable amount, which is determined as the higher of an asset's fair value less costs to sell and its value in use. The carrying amount is reduced to the recoverable amount, and the impairment loss is recognized in the statement of comprehensive income. An impairment loss recognized for an asset in prior years is reversed if there has been a change in the estimates used to determine the asset's value in use or fair value less costs to sell.
Repair and maintenance costs of property, plant and equipment are recognized in profit or loss as incurred. Subsequent costs are capitalized, if the recognition criteria are satisfied (usually - if it can be clearly demonstrated that they extend the useful life of the asset, substantially increase the efficiency compared to their original capacity, or otherwise increase the economic benefits of the asset).
Assets under construction and other property, plant and equipment not yet available for use are assessed likewise the historical cost of property, plant and equipment.
Investment property is property held by the Group and used to earn rentals or for capital appreciation with the course of time and that is not occupied by the Group. Investment property comprises properties (buildings, premises and land) that are leased by the Group to third parties under an operating lease.
In the statement of financial position, investment property is recognized at initial cost less accumulated depreciation and impairment losses. Depreciation of the investment property is calculated using the same useful life as for property, plant and equipment.
According to IFRS 16, a contract is a lease if it conveys the right to control the use of an identified asset for a period of time in exchange for compensation. In order to determine whether the contract conveys the right to control the use of identified asset for a period of time, the Group analyzes the existence of the right to obtain substantially all the economic benefits from the use of the identified asset and the right to determine how to use the identified asset.
As a lessee, upon lease commencement the Group recognizes a right-of-use asset and a lease liability.
The right-of-use asset is measured using a cost model at the lease commencement date. Subsequently the Group continues to measure the right-of-use asset at a cost less accumulated depreciation and accumulated impairment and is adjusted to reflect certain remeasurement of the lease liability. The Group depreciates right-of-use asset on a straight-line basis from the lease commencement date to its end. If under the lease agreement the ownership of the underlying asset is conveys to the Group, the right-of-use asset is depreciated over remaining useful life for the leased asset. If the Group has the right-of-use asset that meets the definition of investment property, then it represents it as a part of the investment property and remeasures it at fair value in accordance with the Group's accounting policies. If the Group has the right-of-use asset that relates to a class of PPE to which the Group applies IAS 16's revaluation model, in which case all right-ofuse assets relating to that class of PPE can be revalued.
The lease liability is initially measured at the present value of the lease payments payable over the lease term, discounted at the rate implicit in the lease if that can be readily determined or at the Group's incremental borrowing rate. The Group uses market rates based on zero-coupon yield as a discount rate. Lease payments that are included in the measurement of lease liabilities consist of fixed payments, variable lease payments, the amounts expected to be payable under residual value
guarantees, the assessment of a purchase option and the penalties for terminating the lease. After the lease commencement date the carrying amount of the lease liability increases by the interestreducing over the life of the lease and reduces by the amount of lease payments made. The carrying amount is remeasured if the lease is changed or modified. The Group remeasures the lease liability by discounting the revised lease payments using the revised discount rate if the lease term changes or the value of the option to purchase the underlying asset changes. The Group remeasures the lease liability in the event of a change in amounts expected to be payable under the residual value guarantee or a change resulting from a change in an index or a rate used to determine those payments. The Group accounts for a lease modification as a separate lease if the modification increases the scope of the lease by adding the right to use one or more underlying assets or the rental reimbursement increases by an amount commensurate with the stand-alone price for the increase in scope and any appropriate adjustments to that stand-alone price to reflect the circumstances of the particular contract. The Group recognizes the revaluation amount of the lease liability as an adjustment to the right-of-use asset.
The Group recognizes in profit or loss any gain or loss relating to the partial or full termination of the lease. The Group decided not to recognize the right-of-use assets and lease liabilities in relation to low-value leases and leases that expire within 12 months. The Group recognizes lease payments under such leases as an expense on a straight-line basis over the lease term.
The Group also decided to apply practical simplifications and not to separate components that are not leases from components that are leases, and instead consider each component of the lease as one component of the lease.
For certain leases in which the Group is a lessee, the Group has applied judgment to determine the lease term for leases in which it is a lessee and which include options to extend the lease. An assessment of the Group's reasonable assurance that such options will be exercised affects the lease term, which largely determines the amount of recognized lease liabilities and right-of-use assets. The maximum extension period used by the Group is 10 years.
Leases for which the Group retains substantially all the risks and rewards associated with owning an asset are classified as operating leases. The lease income is recognized on a straight-line basis over the lease term and is included in revenue in the statement of profit or loss due to its operational nature. Initial direct costs incurred when entering into an operating lease are included in the carrying amount of the leased asset and recognized over the lease term on the same basis as the rental income. Contingent rents are recognized as revenue in the period in which they are received.
Goodwill is the excess of the purchase price over the fair value of the acquirer's share in the identifiable assets, liabilities and contingent liabilities of the acquired subsidiary or associate at the acquisition date. Goodwill is initially recognized at cost less accumulated impairment losses, if any.
The Group tests goodwill for impairment at least once a year or more frequently when there is an indication that the unit may be impaired. Goodwill is allocated to cash-generating units (groups of assets that generate cash flows) or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose. As a rule, cash-generating units are the corresponding Group's clubs.
Under IFRS 11 "Joint Arrangements" investments in joint arrangements are classified as either joint operations or joint ventures. The classification depends on the contractual rights and obligations of each investor, rather than the legal structure of the joint arrangement. The Group has only joint operations and recognizes its direct interest in the assets, liabilities, revenues and expenses of joint operations and its share of any jointly held or incurred assets, liabilities, revenues and expenses.
Separately acquired intangible assets are shown at historical cost. Intangible assets acquired in a business combination except for goodwill are recognized at fair value at the acquisition date. Group's intangible assets, except for goodwill and trademarks have finite useful lives and are subsequently carried at cost less accumulated amortization and impairment losses.
Amortization of intangible assets is calculated based on the period during which the assets' future economic benefits are expected to be consumed by the Group.
The useful life of customer relationships is the residual expected lease term for respective fitness club premises. The amortization is non-linear and the principal part of these assets is amortized within the first 3-5 years.
Rights under franchise agreements have useful lives of 4 and 5 years which are relevant to residual terms of corresponding franchise agreements. The amortization is calculated on a straight-line basis.
Trademarks have indefinite useful life and are tested for impairment annually.
The cost of inventories comprises all costs of purchase, costs of conversion and other costs incurred in bringing the inventories to their present location and condition. The cost of inventories is determined on a weighted average cost basis.
The cost of inventories is written down below cost to net realisable value if those inventories are damaged, if they have become wholly or partially obsolete, if their selling prices have declined or if the estimated costs of completion or the estimated costs to be incurred to make the sale have increased. Net realisable value is the estimated selling price for inventories in the ordinary course of the business less selling costs. Write-down of inventories is recognized as a cost of sales in the current reporting period.
Cash and cash equivalents include cash in hand, deposits held at call with banks and other shortterm, highly liquid investments with original maturities of three months or less.
Restricted balances are excluded from cash and cash equivalents for the purposes of the cash flow statement. Balances restricted from being exchanged or used to settle a liability for at least twelve months after the balance sheet date are included in other non-current assets.
Goodwill and intangible assets that have an indefinite useful life are not subject to amortization and are tested annually for impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs of disposal and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
Revenue from services rendering is recognized by the Group in the accounting period in which the services are rendered. Revenue which is recognized in these financial statements does not include VAT (regarding companies which pay VAT) and reduced by the amount of discounts and rebates given to the customers according to all marketing promotions of the Group.
Amounts received from the customers of the services as payments for future services (including cards for sport services) are initially recognized in item "Deferred revenue" and are amortized with recognition of revenue in proportion to rendering of services.
Costs on borrowings to finance acquisition, construction or production of qualifying assets (which are assets that take a substantial period of time to get ready for their intended use or sale), are recognized according to IAS 23 "Borrowing costs" at initial cost till such assets are ready for their intended use or sale. All other borrowing costs are expensed.
In all cases when the Group receives assets from the owners of the Group, the assets received are initially recognized at fair value in correspondence with additional paid-in capital.
The companies of the Group may incur expenses that are not caused by economic necessity but are advised by the owners of the Group. Such expenses are recognized in correspondence with additional paid-in capital.
In the same way, the differences between fair value of loans given to (received from) the owners of the Group and their notional value are recognized as additional paid-in capital.
According to IAS 37 "Provisions, Contingent Liabilities and Contingent Assets" provisions are recognized when the Group has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount can be made. When the Group expects a provision to be reimbursed, for example under an insurance contract, the reimbursement is recognized as a separate asset, but only when the reimbursement is virtually certain.
Provisions are revised once a year and are recognized in the financial statements at expected net present value, calculated using rates reflecting risks specific to the liability.
The income tax charge according IAS 12 "Income Tax" comprises current tax and deferred tax. Current tax is the amount expected to be paid to state budget in respect to taxable profits or losses for the current and prior periods, using tax rates enacted or substantially enacted at the reporting date.
Deferred income tax is provided using the statement of financial position liability method for tax loss carry forwards and temporary differences arising between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. In accordance with the initial recognition exemption, deferred taxes are not recorded for temporary differences on initial recognition of an asset or a liability in a transaction other than a business combination if the transaction when initially recorded affects neither accounting nor taxable profit. Deferred tax balances are measured at tax rates enacted or substantively enacted at the balance sheet date which are expected to apply to the period when the temporary differences will reverse or the tax loss carry forwards will be utilized.
Deferred tax liabilities are recorded for income tax positions that are determined by management as more likely than not to result in additional taxes being levied if the positions were to be challenged by the tax authorities. Deferred tax assets for deductible temporary differences and tax loss carry forwards are recorded only to the extent that it is probable that future taxable profit will be available against which the deductions can be utilized. Amount of deferred tax assets is revised at every balance sheet date and is deducted to the extent that the probability of making profit from the tax liability realization does not exist anymore.
Basic earnings per share. Basic earnings per share is calculated by dividing:
Diluted earnings per share. Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account:
Intra-group balances and any unrealized gains and losses arising from intra-group transactions are eliminated in preparing the consolidated financial statements.
Unrealized losses are eliminated in the same way as unrealized gains, but only to the extent that there is no evidence of impairment.
Share capital represents the issued number of shares outstanding at their par value. Any excess amount of capital raised is included in Additional paid-in capital. External costs directly attributable to the issue of new shares, other than on a business combination, are shown as a deduction, net of tax, in Additional paid-in capital. Share issue costs incurred directly in connection with a business combination are included in the cost of acquisition.
Finance income comprises interest income on loans and accounts receivable, and exchange differences arising on financial activities. Interest income is recognized as it accrues in profit or loss, using the effective interest method.
Finance costs comprise interest expense on borrowings. Interest expense is recognized in profit or loss using the effective interest method.
A segment is a distinguishable component of the Group that is engaged either in providing products or services (business segment), or in providing products or services within a particular economic environment (geographical segment), which is subject to risks and rewards that are different from those of other segments. Segment results that are reported to the Group's chief operating decision-maker include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which control is transferred to the Group. Control is obtained when the Group is exposed, or has rights, to variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee, for more details see par. «Principles of consolidation» in the section III. «Basis of preparation».
When the control obtained without owning interest in share capital of an acquired company the Group uses the following accounting method. The Group combines the acquired company's financial data into consolidated financial statements by item-by-item summing up of similar assets, liabilities, income and expenses. All transactions within the Group's companies and unrealized gains and losses as well as the mutual balances within the Group's companies are eliminated. Equity and current financial results of the acquired companies are recognized as Non-controlling interest.
NCI are measured at their proportionate share of the acquiree's identifiable net assets at the date of acquisition.
Changes in the Group's interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions.
Where necessary, comparative figures have been adjusted to conform to changes in presentation in the current year.
In preparing these financial statements the Group has found several errors the financial statements previously reported and has made retrospective restatement of statement of financial position as at 31.12.2020 and of statement of comprehensive income for the year ended 31.12.2020. These adjustments and their effect are described in detail below.
| in thousand EUR | 2020 (restated) |
2020 (previously reported) |
Adjustment | Comments (see below) |
|---|---|---|---|---|
| Cost of Sales | (21038) | (19532) | (1506) | Adj. $#1$ |
| Gross profit | 5096 | 6 6 0 2 | (1506) | |
| Selling and marketing expenses | (1553) | (1356) | (197) | Adj.#1 |
| Administrative expenses | (3448) | (3380) | (68) | Adj.#1 |
| Other losses | (2022) | (1256) | (766) | Adj.#1 and Adj.#2 |
| Profit before tax | (1341) | 1 1 9 6 | (2537) | ۰ |
| Income tax gains/(expense) | 620 | 263 | 357 | Adj.#1 |
| Net profit/(loss) for the year | (721) | 1459 | (2180) | Adj.#1 and Adj.#2 |
| Basic earnings per share from continuing operations (basic and diluted), EURO |
(11,83) | 42,68 | (54, 50) | Adj.#1 and Adj.#2 |
| Foreign currency translation differences |
602 | 900 | (297) | Adj.#1 and Adj.#2 |
| Comprehensive income attributable to: | ||||
| Owners of the Group | 566 | 2549 | (1983) | Adj.#1 and Adj.#2 |
| Non-controlling interests | (685) | (190) | (494) | Adj.#1 and Adj.#2 |
| Total comprehensive income for the year |
(119) | 2 3 5 9 | (2477) | Adj.#1 and Adj.#2 |
| in thousand EUR | 31.12.2020 (restated) |
31.12.2020 (previously reported) |
Adjustment | Comments |
|---|---|---|---|---|
| Deferred tax assets | 1 0 38 | 713 | 325 | Adj. $#1$ |
| Total non-current assets | 30 224 | 29899 | 325 | |
| Advances paid | 4 0 7 1 | 5316 | (1245) | Adj. $#1$ |
| Income tax overpayment | 97 | 101 | (4) | |
| Loans granted to other parties | 5656 | 6339 | (683) | Adj.#2 |
| Total current assets | 19416 | 21 348 | (1932) | |
| TOTAL ASSETS | 49 640 | 51 247 | (1607) | |
| Translation reserve | 674 | 477 | 197 | Adj.#1 and Adj.#2 |
| Other reserves | 255 | 255 | Adj.#3 | |
| Accumulated profit (loss) | 2008 | 2 2 6 3 | (255) | Adj.#3 |
| Current year profit (loss) | (472) | 1708 | (2180) | $\overline{\phantom{a}}$ |
| Equity attributable to owners of the Group |
2727 | 4710 | (1983) | |
| TOTAL EQUITY | 2960 | 4943 | (1983) | |
| Long-term payables other | 515 | 515 | Adj.#4 | |
| Total non-current liabilities | 16 216 | 15701 | 515 | |
| Short-term trade payables | 4815 | 5 1 2 7 | (312) | Adj.#1 and Adj.#4 |
| Short-term payables other | 625 | 449 | 176 | Adj.#4 |
| Total current liabilities | 30 4 64 | 30 603 | (139) | |
| TOTAL EQUITY AND LIABILITIES | 49 640 | 51 247 | (1607) |
Adj.#1 Untimely recognition of operating expenses (primarily, Oustaffing services and Advertising costs) and relevant effect on deferred income tax asset
Adj.#2 Untimely recognition of credit losses
Adj.#3 Other reserves presented separately
Adj.#4 Long-term and short-term liability for property, pland and equipment purchased presented separately from other liabilities
| in thousand EUR | 2021 | 2020 |
|---|---|---|
| Revenue from club cards sales | 20 073 | 13 164 |
| Revenue from related sport services rendering | 14 340 | 10 082 |
| Licence fees income | 1934 | 1680 |
| Revenue from retailing and food services | 1 3 6 1 | 937 |
| Revenue from sports clubs management | 548 | 206 |
| Revenue from operating leasing | 91 | 66 |
| Total | 38 348 | 26 134 |
| Cost of Sales 3. |
||
|---|---|---|
| in thousand EUR | 2021 | 2020 (restated) |
| Outstaffing services | 13 133 | 11 654 |
| Depreciation | 4 0 14 | 4 4 6 2 |
| Utilities expenses | 2 2 1 2 | 775 |
| Salary and social tax | 2 1 2 9 | 947 |
| Cost of goods sold | 1 0 0 6 | 565 |
| Leasing | 714 | 608 |
| Material costs | 569 | 1 0 9 5 |
| Amortization | 302 | 468 |
| Repairs and maintenance | 275 | 329 |
| Disinfection and cleansing | 18 | 19 Chambeton RA |
| Royalties | $\frac{1}{2}$ 183 | 58 a li lim in ci |
| Taxes | turaversen w il erwong klob had. | $\overline{0}$ |
| Cleaning services | 242 Greenighed |
$\overline{2}$ rugaliwe d |
| Other expenses | 17 | 56 the mass is interest. |
| Total | 24 817 第9 22 30 10 10 11 12 |
21 038 |
| in thousand EUR | 2021 | 2020 (restated) |
|---|---|---|
| Advertising and marketing services | 2 1 0 4 | 1 007 |
| Salary and social tax | 871 | 467 |
| Holiday organization services | 29 | 51 |
| Material costs | 4 | |
| Other expenses | 28 | 22 |
| Total | 3 0 3 6 | 1553 |
| han Rasmit (Article) in filthing links as infinitely with | ||
|---|---|---|
| in thousand EUR | April Le Ville 2021 |
2020 (restated) |
| Salary and social taxes | umano - na 30 d'aona 20. 2011. 1633 |
869 |
| Consulting services | 1 1 1 4 | 922 |
| Bank services | 615 ilio il n Ky |
424 |
| Material costs | 220 on in a discurrent but in right father |
554 |
| Communication services | 175 (Telephone) |
164 |
| Asset repairs and maintenance | 260 | 110 |
| Utilities expenses | 44 | 73 |
| Security services | 66 | 57 |
Page 35 of 61
INTRAWARE GROUP Consolidated financial statements for the year ended 31 December, 2021
in thousand EUR, unless otherwise stated
豪
| Cleaning services | 69 | 43 |
|---|---|---|
| Travelling expenses | 47 | 27 |
| Depreciation | 41 | 20 |
| Leasing | 39 | 23 |
| Brokerage commission | 13 | 14 |
| Insurance | 4 | 12 |
| Transport expenses | 13 | 11 |
| Other expenses | 38 | 126 |
| Total | 4 3 9 1 | 3448 |
| in thousand EUR | 2021 | 2020 (restated) | |
|---|---|---|---|
| Write-off of accounts payable | 306 | Sent Lawrence (1975) | 0 |
| Bad debt provision (recovery) | 391 | Barbara | 0 |
| Exchange differences (profit) | 268 | 64 | |
| Profit from other disposal | 157 | ||
| Profit from providing asset in financial lease | 131 | -12 - 11 - 1 | 0 |
| Long-term lease modification income | 36 | 165 | |
| Profit from assets disposal | 20 | 300 | |
| Other income | 494 | 100 | |
| Covid19 rent concessions gains | 2599 | ||
| Total | 1802 | 3 2 2 9 |
| in thousand EUR | 2021 | 2020 (restated) | |
|---|---|---|---|
| Write-down of accounts receivable | 383 | 408 | |
| Net impairment (loss) on financial and contract assets |
281 | 488 | |
| Loss from assets and other disposal | 146 | 17 | |
| Loss from goodwill impairment | 106 | ||
| Shortage discovery as a result of inventory count |
66 | ||
| Bad debt provision (accrual) | 8 | 782 | |
| Interest and penalties under contracts | 6 | ||
| Sanctions, fines and penalties - losses | 3 | ||
| Other losses | 356 | 153 | |
| Exchange differences (losses) | 172 | ||
| Total | 1 3 5 5 | 2022 |
| 8. Financial income and financial expenses | |||
|---|---|---|---|
| Financial income | TOTAL COUNTY for policy and county of the county | ||
| in thousand EUR | 2021 | 2020 | |
| Loan interest receivable | 530 | 547 | |
| Imputed interest income on accounts receivable and payable | 20 | ||
| Exchange differences (income) on financial activities | 26 | 568 | |
| Total | 626 | 1 1 35 |
$\sim$
| in thousand EUR | 2021 | 2020 |
|---|---|---|
| August D (1990 p.d., 19825 Aproval every to be Interests on lease liabilities |
3 1 5 6 | 3589 |
| Exchange differences (expenses) on financial activities | 239 | |
| Report of Moore Loan interest payable |
174 COURCES INC. |
188 |
| Other interest payable | 26 | |
| Total | 3594 | 3778 |
a ka
Expenses for depreciation of property, plant and equipment are recorded in the consolidated statement of profit or loss and other comprehensive income within the lines "Cost of sales" and "General administrative expenses" (see notes 3 and 5).
| Improveme | Sport | Other Property, |
|||
|---|---|---|---|---|---|
| in thousand EUR | nts of leased property |
equipment | Buildings | Plant & Equipment |
TOTAL |
| Initial value | THE RESIDENCE OF PERIOD | ||||
| Initial value as at 01.01.2020 Additions in 2020 Disposals in 2020 |
2585 | 3 4 0 3 83 |
2 2 5 6 793 |
327 54 |
8570 931 |
| Disposal as a result of cease control over |
(18) | (19) | |||
| Bladesteel Ltd | (2256) | (2256) | |||
| Translation reserve | (608) | (807) | (72) | (78) | (1565) |
| Initial value as at 31.12.2020 | 1976 | 2661 | 721 | 302 | 5 6 6 2 |
| Additions in 2021 | 135 | 358 | 68 | 561 | |
| Disposals in 2021 | (5) | (120) | (4) | (129) | |
| Acquired in business combinations in 2021 |
1 2 1 9 | 560 | 143 | 1922 | |
| Translation reserve | 211 | 238 | 57 | (13) | 492 |
| Initial value as at 31.12.2021 | 3536 | 3697 | 778 | 496 | 8508 |
| Accumulated depreciation and impairment as at 01.01.2020 |
(970) | (2 098) | (17) | (190) | (3 275) |
| Depreciation accrued in 2020 | (132) | (172) | (20) | (16) | (341) |
| Disposals in 2020 | 0 | 18 | 18 | ||
| Translation reserve | 240 | 508 | 19 | 46 | 813 |
| Accumulated depreciation and impairment as at 31.12.2020 |
(862) | (1745) | (19) | (159) | (2784) |
INTRAWARE GROUP
Consolidated financial statements for the year ended 31 December, 2021 in thousand EUR, unless otherwise stated
| Depreciation accrued in 2021 | 183 | (360) | (40 | (591) | |
|---|---|---|---|---|---|
| Disposals in 2021 | 75 | 82 | |||
| Translation reserve | (74) | (147) | $^{(2)}$ | (14) | (237) |
| Accumulated depreciation and impairment as at 31.12.2021 |
(1117) | (2177) | (28) | (210) | (3531) |
| Carrying amount as at 01.01.2020 |
1614 | 1 305 | 2 2 3 9 | 137 | 5 2 9 6 |
| Carrying amount as at 31.12.2020 |
1 1 1 4 | 917 | 703 | 143 | 2877 |
| Carrying amount as at 31.12.2021 |
2420 | 1520 | 750 | 287 | 4977 |
| In thousand | Net book value as | Impairment | Translation | Net book value as at |
|---|---|---|---|---|
| EUR | at 31,12,2020 | differences | 31.12.2021 | |
| Goodwill | 3 811 | 106) | 296 | 4001 |
Management uses 35 (in 2020-21) cash generating units (CGU) for impairment test. The group tests whether goodwill has suffered any impairment on an annual basis. The recoverable amount of a CGU is determined based on value-in-use calculations which require the use of assumptions.
The calculations use cash flow projections based on financial budget for the subsequent year approved by management. The management expects that revenue from fitness services in 2022 will reach revenue of the last year before the Covid-19 crisis and will gradually increase by 2.5% till 2025 and by 2% in subsequent years.
The period of calculation is consistent with lease terms expected by the management for each fitness club. The terms range from 1 to 16 years (from 1 to 14 years for 2020 year impairment test) with an average of 7 years (7 years for 2020 year impairment test).
The cash flows are discounted at pre-tax rate of 15,6% (14,8% for 2020 year impairment test). The rate is derived from the Group's weighted average cost of capital (WACC) calculated by management.
As a result of the test an impairment of goodwill in amount of EUR 106 thousand has been recognized in 2021 in respect of the fitness club "AK-Bars" that is subject to liquidation (2020: nil).
During the 2021 year the Company acquired 25% of the share capital of Feelgood Tech LLC for an amount of 161 thousand euro.
During the 2019 year the Company acquired 20% of the share capital of A.C.T. Squad Fitness Limited for an amount of 90 thousand euro. At 31.12.2021 the share in the capital of A.C.T. Squad Fitness Limited has not changed.
Movement in the accounts of investments in associated companies for the years ended 31 December 2021 and 2020 is presented below:
2021 2020
INTRAWARE GROUP
Consolidated financial statements for the year ended 31 December, 2021 in thousand EUR, unless otherwise stated
| Investments in associated companies at 01 January | 100 | 99 |
|---|---|---|
| New affiliated companies | 161 | 20 - 10 A - 10 A - 10 A |
| Share in profit (net of income tax) | ||
| Investments in associated companies at 31 December | 261 | 100 |
| in thousand EUR | Customer relationship (club cards) |
Customer relationship (related) services) |
Rights under franchise agreements |
Research and develop ment |
Other immaterial assets |
Total |
|---|---|---|---|---|---|---|
| Initial value | ||||||
| Initial value 01.01.2020 | 4809 | 2542 | 467 | 79 | 7896 | |
| Additions in 2020 | ||||||
| Translation differences | (1132) | (598) | (110) | (6) | (1846) | |
| Initial value as at 31.12.2020 | 3677 | 1943 | 357 | 72 | 6 0 5 0 | |
| Additions in 2021 | 380 | 52 | 382 | |||
| Disposal in 2021 | (49) | |||||
| Translation differences | 289 | 102 | 391 | |||
| Initial value as at 31.12.2021 | 3966 | 2045 | 380 | 55 | 6446 | |
| Accumulated amortization | ||||||
| and impairment as at 01.01.2020 |
(3756) | (2170) | (465) | (27) | (6418) | |
| Amortization accrued in 2020 | (331) | (136) | (1) | (1) | (468) | |
| Translation differences | 914 | 523 | 110 | 6 | 1553 | |
| Amortization and impairment as at 31.12.2020 |
(3172) | (1783) | (357) | (21) | (5333) | |
| Amortization accrued in 2021 | (220) | (82) | (302) | |||
| Translation differences | (257) | (92) | 357 | 17 | 25 | |
| Accumulated amortization | ||||||
| and impairment as at | (3650) | (1957) | (3) | (5611) | ||
| 31.12.2021 | ||||||
| Carrying amount as at 31,12,2019 |
1053 | 371 | $\mathbf{1}$ | 52 | 1477 | |
| Carrying amount as at 31.12.2020 | 505 | 160 | 52 | 716 | ||
| Carrying amount as at 31.12.2021 |
316 | 88 | 52 | 835 |
Customer relationships (acquired in a business combination) represent future benefits from loyal customers in connection with expected purchases of cards, relating services and food. The expected prolongation of cards and purchases of relating services and food are projected on the basis of prolongation rates confirmed by business practice of each club. The projection period was determined similar to useful lives of leasehold improvements in the corresponding club.
Rights under franchise agreements represent future benefits from concluded franchise agreements as at the acquisition date. The expected cash flows were projected in accordance with the terms of agreements and expected costs.
Amortization of customer relationships is non-linear and is calculated in accordance with the recognition of corresponding profits by the Group. Amortization of other assets with definite useful lives is carried out on a straight-line basis. Amortization expense is presented in the consolidated statement of comprehensive income within the line "Cost of sales" (see note 3).
During 2021 the Group has started developing a mobile application. The development cost for 2021 was EUR 380 thousand.
| in thousand EUR | 2021 | 2020 (restated) |
|---|---|---|
| Advances paid for the purchase of current assets and services | 10 909 | 4 0 7 1 |
| Total | 10 909 | 4 0 7 1 |
| in thousand EUR | 2021 | 2020 |
|---|---|---|
| Other inventory | 106 | 108 |
| Goods | 102 | 88 |
| Equipment and maintenance accessories | 126 | 75 |
| Total | 334 | 271 |
| in thousand EUR التالين و 土力量 Financial assets |
2020 A SALE YARRE EN DO 2021 Community Community Service |
|
|---|---|---|
| Other short-term receivables from operating activities Non-financial assets |
but anticommune 2.017 LETTER IN A STATE OF A 1997 and the first state of the state of the state |
371 |
| Other taxes overpayments | e fizikaan asu 140 |
96 |
| Total | 2 1 5 7 | 467 |
s – al
| in thousand EUR | 2021 | 2020 |
|---|---|---|
| Receivables from customers, the nominal amount | 1561 | 2 021 |
| Allowance for receivables from customers | (532) | (55) |
| Total | 1 0 2 9 | 1966 |
| in thousand EUR | 2021 | 2020 |
|---|---|---|
| Balance at 1 January and the state of the con- |
3 3 0 3 | 3 2 4 4 |
| New loans granted | 269 | 187 |
| Interest charged | ||
| Unrealized foreign exchange (loss)/profit | (33) |
| Total | 272 | 3 3 0 3 |
|---|---|---|
| Assigned from shareholders' current accounts - | 213 | |
| Assigned to shareholders' current accounts - | (125) | |
| Set off against dividends payable | (1019) | |
| Set off against loans payable | (2468) | |
| Reversal of impairmet/(Impairment charge) on loans receivable | 95 | (95) |
The loans are repayable as follows:
$\tilde{3}$
| in thousand EUR | 2021 | 2020 |
|---|---|---|
| who can't spelly terms of the later was well as of the Within one year |
272 | 1016 |
| Between one and five years | 2 2 8 6 | |
| Total | 272 | 3 3 0 3 |
| 18. Capital in partnerships | ||
|---|---|---|
| in thousand EURO | ||
| Balance at 1 January | 665 | 370 |
| Deposits | 109 | 296 |
| Share of partnership loss | ||
| Balance at 31 December | 0.000 - 1 美以3000 - 000 - 00- 774 provide comparish a manager result of semigraphy comparating me. Invite of the second comparishes of the |
665 |
| Name in thousand EURO |
Country of incorporation |
Ol lua casani slo Principal activities |
2021 Holding $\frac{0}{0}$ |
2020 Holding $\frac{0}{0}$ |
m executi fli 2021 |
2020 |
|---|---|---|---|---|---|---|
| Decalia Capital Direct Investment II SCSp |
Switzerland as far my excels, a complication and start will be expected to address and |
Metal factory | 4,17 | 4,17 | 483 | 374 |
| START THE CONTRACTORS OF LIGHT AND CONTRACTORS Decalia Capital Direct Investment III SCSp |
Switzerland be an indege it wildle best-but |
Bi-Metal factory and Radiology clinics |
$\frac{1}{2}$ . $\frac{1}{2}$ . $\frac{1}{2}$ . $\frac{1}{2}$ . $\frac{1}{2}$ | curidibili i modifiam in al- $\overline{4}$ THE LUCE LIGHT SERVICE |
291 | 291 |
| Total | 774 | 665 |
| in thousand EUR | 2021 | 2020 |
|---|---|---|
| Balance at 1 January | 4 1 7 4 | 3 3 0 8 |
| Additions COLL PRODUCTS |
1897 party of the figure party of the control of the first finance |
2 2 2 3 |
| Disposals | (2862) | (1179) |
| Change in fair value | 130 | (171) |
| Profit from sale of financial assets | 50 | $\left( 4\right)$ |
| Interest income from bonds | 68 | |
|---|---|---|
| Interest received from bonds | (63) | (65) |
| Balance at 31 December | 3 3 9 4 | 4.174 |
The financial assets at fair value through profit or loss are marketable securities and are valued at market value at the close of business on 31 December by reference to Stock Exchange quoted bid prices. Financial assets at fair value through profit or loss are classified as current assets because they are expected to be realized within twelve months from the reporting date.
In the statement of cash flows, financial assets at fair value through profit or loss are presented within the section on operating activities as part of changes in working capital. In the statement of profit or loss and other comprehensive income, changes in fair values of financial assets at fair value through profit or loss are recorded in operating income.
| 20. Cash and cash equivalents | ||
|---|---|---|
| in thousand EUR | 2021 | 2020 |
| Cash at bank | 500 | 1 2 6 5 |
| Transfers in transit | 289 | 199 |
| Cash in hand | 233 | 60 |
| Bank deposits | ||
| Total | 1 0 23 | 1525 |
Upon incorporation on 11 August 2011 the Company issued to the subscribers of its Memorandum of Association 10 000 ordinary shares of $E1$ each at par.
On 13 March 2015 the Board of Directors proposed and the shareholders approved the increase of the authorized share capital to 30 000 ordinary shares and the issue of additional 20 000 ordinary shares of €1 each at par. Furthermore, on 6 May 2015 the Board of Directors proposed and the shareholders approved the increase of authorized share capital to 40 000 ordinary shares and the issue of additional 10.000 ordinary shares of $\epsilon$ 1 each with a share premium of $\epsilon$ 22,20 per share recognized as Additional paid-in capital in amount of 222 thousand EUR. As at 31 December 2015 the Company had a total authorized and issued share capital of 40 000 ordinary shares.
In 2016-2021 years, there were no changes in the share capital.
Translation reserve is derived as the difference of translation of the Group's financial position and financial result in functional currency (Russian Roubles for the Russian subsidiaries) into presentation currency - EURO.
In 2021 year, the Board of Directors approved the payment of dividend for EURO 3 333 thousand out of the profits of previous years (2020: EUR 2040 thousand).
Dividends are subject to a deduction of special contribution for defense at 17% for individual shareholders that are both Cyprus tax resident and Cyprus domiciled.
Companies in Cyprus which do not distribute 70% of their profits after tax, as defined by the relevant tax law, within two years after the end of the relevant tax year, will be deemed to have distributed as dividends 70% of these profits. Special contribution for defense at 17% will be payable on such deemed dividends to the extent that the shareholders (companies and individuals) are Cyprus tax residents. The amount of deemed distribution is reduced by any actual dividends paid out of the profits of the relevant year at any time. This special contribution for defense is payable by the Company for the account of the shareholders.
| The overall structure of the Group loans is as follows: | A REPORT OF THE REAL PROPERTY AND RESIDENTS | |
|---|---|---|
| in thousand EUR | 2021 | 2020 |
| Short term loans | 728. | 3 1 3 6 |
| Total short-term loans | 728 | 3 1 3 6 |
Short-terms loans are presented in the table below:
| Lender | Currency | The interest rate |
Carrying amount as at 31.12.2021 |
Carrying amount as at 31.12.2020 |
|---|---|---|---|---|
| Worteck Global Corp. (related party) | EUR | 5,00% | Stan moneth | 1727 |
| PJSC Sberbank | RUB | 3-10% | 478 | |
| Other loans | RUB | $0-12%$ | 251 | 1 409 |
| Total short-term loans | 728 | 3 1 3 6 |
Reconciliation of differences in liabilities related to financing activities, including both monetary and non-monetary movements, is presented below:
| in thousand EUR an endoption for hid only an endomic super in 1889. |
2021 |
|---|---|
| Loans payable as at 01.01.2021 | 3 1 3 6 |
| Proceeds of loans and borrowings | 1559 |
| Acquired in business combinations in 2021 | 83 RALL GULSTER RUSH |
| Repayment of loans and borrowings | (1532) |
| Foreign exchange differences are were not to securely corporate to these in andel of the such these each |
213 |
| Decrease of interest accrued | (21) |
| Set off against loans receivable | (2468) Sulveyes have most the micromatic |
| Translation differences | (241) |
| Loans payable as at 31.12.2021 | 728 |
| in thousand EUR | place or selling of an off of | 2020 | |
|---|---|---|---|
| Loans payable as at 01.01.2020 | all de Sagiere fille en provincia la filla de la filla | 3422 | |
| Proceeds of loans and borrowings | 1 100 | ||
| Repayment of loans and borrowings | gan gan had a suitpaged by a region of the affirmed to a se- | (1237) | |
| Foreign exchange differences | The AS of Accord Of AP, and the annual formation of Selling | (568) | |
| Decrease of interest accrued | (82) | ||
| Translation differences | a conserver for more to be former to the contract of | 500 | |
| Loans payable as at 31.12.2020 | 3 1 3 6 |
| in thousand EUR, unless otherwise stated |
|---|
| 23. Short-term accounts payable | ||
|---|---|---|
| ndi kan mengelas The in thousand EUR band area. Brandward award and consultation |
2021 | 2020 (restated) |
| Financial liabilities and a second proposed with the control of the Plats. |
||
| Payables to suppliers (operating activity) and is the second off computer |
1792 | 4 0 5 0 |
| Other payables (operating activity) | 1650 | 711 |
| addition has in the city began online. Accounts payable for non-current assets |
93 | 177 |
| Non-financial liabilities | 3536 | 4937 |
| Advances received (operating activity) | ||
| Provision for future expenses | nh m | 55 |
| Taxes and social chargers for payables to employees | 393 | |
| Total | 3928 | 4991 |
$\sim 4$ .
| in thousand EURO | 2021 | 2020 | ||
|---|---|---|---|---|
| Vacation provision | Dear the | OFFICERS IN LATE | 338 | 206 |
| Other provisions for payables to employees | 430 | |||
| Salaries payable | wului | 155 | 15 | |
| Social charges | VI 191 | 154 | 46 | |
| Income tax | ma an | $10 - 50$ | 19 | 65 |
| VAT | 74 | 60 | ||
| Other taxes | building guild but an woor good to 17 |
58 | ||
| Personal Income Tax | would all build sections. I call the metabolic plane the gap may 36 |
|||
| Taxes on other provisions for payables to employees | 131 | |||
| Total | 1 3 5 4 | 449 |
Income tax in the Statement of Comprehensive Income in profit and losses includes:
| In thousand EUR | 2021 | 2020 (restated) |
|---|---|---|
| Current income tax in Cyprus (12,5%) | 30 | |
| Current income tax in Russia (20%) | 430 | 70 |
| Deferred income tax in Russia (20%) | (223) | .712 |
| Total tax expense/gain | 237 | (620) |
Tax rate is 12,5% for parent company in Cyprus and 20% for its subsidiaries in Russia. The deferred tax in Russian subsidiaries as at 31 December 2021 and 31 December 2020 was calculated at the 20% rate.
Under certain conditions interest income in Cyprus may be subject to defense contribution at the rate of 30%. In such cases this interest will be exempt from corporation tax. In certain cases, dividends received from abroad may be subject to defense contribution at the rate of 17%.
| In thousand EUR | 2021 | 2020 | (restated) | |
|---|---|---|---|---|
| Profit before tax | 983 | 2600 | (4700) | 3 3 5 9 |
| Tax rates | 20,00% | 12,50% | 20,00% | 12,50% |
| Tax calculated at the applicable tax rates | (197) | (325) | (940) | (420) |
| Tax effect of expenses not deductible for tax purposes |
(10) | (314) | 1573 | (86) |
| Tax effect of allowances and income not subject to tax |
623 | 501 | ||
| Overseas tax in excess of credit claim used during the year |
(14) | (8) | ||
| Total tax income (expense) | (207) | (30) | 633 | (13) |
Reconciliation between the expected and the actual tax charge is provided below:
The basis of temporary differences between the value of assets and liabilities in the Statement of financial position and their tax bases are the differences between IFRS and the legislation on taxes and duties of countries in which the Group companies are operating. The sources of the appearance and the tax effect of the change in temporary differences are presented in the table below.
Deferred tax assets (liabilities) classified by types of assets and liabilities which formed differences (net):
| In thousand EUR | As at 31 December 2020 (restated) |
Addition as a result of business acquisition (recognized in equity) |
Recognized in the Statement of Comprehensive Income in profit and losses |
Translation differences |
As at $31$ December 2021 |
|---|---|---|---|---|---|
| Property, plant and equipment |
(28) | (164) | (8) | (200) | |
| Intangible assets | (133) | 31 | (9) | (111) | |
| Receivables | 340 | (193) | 20 | ||
| Deferred income | 12 | (166) | 149 | 6 | |
| Deferred tax losses | 229 | 373 | (177) | 12 | 437 |
| Lease liabilities | 465 | 446 | 53 | 964 | |
| Other | (128) | 5 | (133) | ||
| Net deferred tax asset (liability) Recognised in the |
886 | 207 | 220 | 78 | 1389 |
| Statement of Financial Position: |
|||||
| Deferred tax asset | 1 0 38 | 1404 | |||
| Deferred tax liability | (152) | (14) |
44-100 1970 11:11
Consolidated financial statements for the year ended 31 December, 2021
| in thousand EUR, unless otherwise stated | |
|---|---|
| In thousand EUR | As at $31$ December 2019 |
Disposals of subsidiaries |
Recognized in the profit and losses |
Translation differences |
As at $31$ December 2020 (restated) |
|---|---|---|---|---|---|
| Property, plant and equipment |
(122) | 238 | (44) | (100) | (28) |
| Intangible assets | (275) | $\Omega$ | 142 | (133) | |
| Receivables | 105 | (78) | 313 | 340 | |
| Deferred income | 50 | 64 | (102) | 12 | |
| Deferred tax losses for the future |
46 10 milia |
214 | (31) | 229 | |
| Lease liabilities | 373 | 198 | (106) | 465 | |
| Other | (3) | (0) | 3 | ||
| Net deferred tax asset (liability) |
174 | 238 | 354 | (116) | 886 |
| Deferred tax asset | 564 | 1038 | |||
| Deferred tax liability | (390) | (152) |
The Group mainly leases buildings and other non-residential real estate.
| n in asovg to heirpeak (tolling)) stora na bogodyl The right-of-use assets: |
||
|---|---|---|
| in thousand EUR | Buildings | Total |
| Right-of-use assets as at 01.01.2021 | ||
| Additions in 2021 | 316 | 316 |
| Acquired in business combinations | 20 341 | 20 341 |
| Disposals al bechages. I |
(219) | (219) |
| Modifications in 2021 $910 - 7$ |
(1105) | (1105) |
| Depreciation in 2021 | (3 464) | (3 464) |
| Translation differences in 2021 | 2 3 4 7 | 2 3 4 7 |
| Right-of-use assets as at 31.12.2021 | 36 691 | 36 691 |
| in thousand EUR | Buildings | Total |
|---|---|---|
| Right-of-use assets as at 01.01.2020 | 30 670 | 30 670 |
| Additions | 2714 | 2714 |
| Modifications | (3950) | (3950) |
| Depreciation | (4108) | (4108) |
| Translation differences | (6850) | (6850) |
| Right-of-use assets as at 31.12.2020 | 18 475 | 18 475 |
| Lease liabilities: | ||
|---|---|---|
| in thousand EUR | 31.12.2021 | 31.12.2020 |
| Long-term lease liabilities | 33 138 | 15 549 |
| Short-term lease liabilities | 9585 | 5 1 8 5 |
| Lease liabilities | 42723 | 20735 |
|---|---|---|
The change in the carrying amount of lease liabilities is presented below:
| in thousand EUR | Lease liabilities containing no purchase options |
Total |
|---|---|---|
| Lease liabilities as at 01.01.2021 | 20735 | 20735 |
| Conclusion of new lease agreements | 170 | 170 |
| Acquired in business combinations | 16 660 | 16 660 |
| Modification of lease agreements | 1995 | 1995 |
| Interest expense on the lease liability | 3 1 5 6 | 3 1 5 6 |
| Lease payments | (5965) | (5965) |
| Translation differences | 5973 | 5973 |
| Lease liabilities as at 31.12.2021 | 42723 | 42723 |
| . HEROE HEE IS SPAND (SEE ERE HERDE) I HEROEDI HEEFTI JEKU SII LA aut aux -ordunental, estas sono fina al car centrae I is the complete strong in in thousand EUR ni mitori boteh |
Lease liabilities containing no purchase options |
Total |
|---|---|---|
| Lease liabilities as at 01.01.2020 | 32 4 21 | 32 4 21 |
| Conclusion of new lease agreements and the main and some sense | 2714 | 2714 |
| Modification of lease agreements | (4296) | (4296) |
| Interest expense on the lease liabilitiy | 3589 | 3589 |
| Bureau Fighting Lease payments |
(3921) | (3 921) |
| Translation differences helionalisti attuau |
(9773) | (9773) |
| Lease liabilities as at 31.12.2020 | 20735 | 20735 |
Expenses related to leases in the income statement:
| in thousand EUR | 2021 | 2020 |
|---|---|---|
| Leases in accordance with IFRS 16 | ||
| Interest expense on the lease liability | 3 1 5 6 | 3589 |
| Depreciation for the lease asset | 3 4 6 4 | 4 1 0 8 |
| Shorter-term leases expense | 765 | 342 |
In addition, the income statement discloses expenses related to a short-term lease in the amount of 765 thousand EUR (2020: 342 thousand). Mainly these expenses are related to rent of sport equipment.
The maturity of lease payments is presented in the table below.
Lease payments under non-cancellable operating leases payable in the following periods (nominal value, denominated in RUB)
in thousand EUR
31.12.2020 31.12.2021
INTRAWARE GROUP Consolidated financial statements for the year ended 31 December, 2021 in thousand EUR, unless otherwise stated
| Less than 1 month | 901 | 366 |
|---|---|---|
| 1-6 months | 5455 | 2 2 1 1 |
| mar e ma en la Binjani e la Baltania. L 6 months to 1 year |
5 5 5 4 | 2730 |
| 1-5 years THE REPORT OF STREET |
49 334 | 16 658 |
| Over 5 years | 15 002 | 8 0 7 3 |
| Total | 76 246 | 30 037 |
Term "related party" is defined in IAS 24 "Related Party Disclosures". Parties are usually considered related if they are under common control, one of them has control, significant influence or joint control over the other in financial or operating decision making. Substance of relations, but not their legal form is considered.
Turnover and balance disclosures with related parties under transactions performed by the Group in the reporting period are presented in the following tables. Transactions and balances refer to settlement of accounts with related parties in the category «Shareholders» and "Other related parties".
| in thousand EUR | Nature of transaction | 2021 | 2020 |
|---|---|---|---|
| Worteck Global Corp. | Loan interest | ||
| Amikon LLC | Loan interest | ||
| Trafalgar Capital SA | Loan interest | 10 | |
| Total interest expense | 79 |
| Lender | Curre ncy |
The interest rate |
The term of repayment |
Carrying amount at 31.12.2021 |
Nominal value at 31.12.2020 |
|---|---|---|---|---|---|
| Worteck Global Corp | RUB | 5,00% | 31.12.2020 | 1727 | |
| Amikon LLC | RUB | 5,00% | 31.12.2020 | 96 | |
| Total loans from other related parties |
1823 |
Receivables from related parties:
| in thousand EURO | Nature of transactions | 2021 | 2020 |
|---|---|---|---|
| Bladesteel Limited | a factor of a literature and the later and part of 100 V | 89 | 13 |
| Total license fee income | 89 | 13 | |
| Professional Fees from related parties: |
de l'origin e de l'altri solar del costilità del The Second Control and Control and Control and The Control and The Control and |
||
| Nature of transactions | 2021 | 2020 | |
| in thousand EURO |
| 312 | 604 | ||
|---|---|---|---|
| DIE VRT CONTROL | |||
| Payables to related parties: | |||
| Nature of | |||
| in thousand EURO | transactions | 2021 | 2020 |
| Bladesteel Limited | 1 2 4 3 | 87 | |
| Total | 1 2 4 3 | 87 | |
| Rental payments to related parties: off and there will problem be the final partie understandige between the country and and the control of |
|||
| in thousand EURO DERETTED TO THE STATE OF BULG | Nature of transactions |
2021 | 2020 |
| gigi ni satut matare sil anchi gjeris karl santo sa US Bladesteel Limited |
791 | 466 | |
| Total | 791 | 466 | |
| Shareholder's account | in it to resh tort the process to at eldshidens if is all | gariants aixed out taxed | |
| The shareholders' current accounts are interest free, and have no specified repayment date. | |||
| Key management personnel expenses (4 employees, 2020 - 3 employees): | |||
| Benefits in 2021 | |||
| actor I aren't for motion Perrill and to read out in thousand EUR |
Benefits in 2020 | ||
| Short-term benefits paid to key management | 28 | ||
| personnel | 55 | ||
| Social security contributions | ummange og Barones | ||
| Total | 63 | 32 | |
| There are no settlements of account balances with key management personnel as at the reporting dates. ent militar delutra eponó adi in quinto servita vina agre april regio ell' "Af |
As at 31 December 2021, Intraware Investments Public Ltd does not have a single ultimate controlling party (as at 31 December 2020 – same). The controlling party (as at 31 December 2020 – same).
| Shareholders | The number of shares | Percentage of the total number of shares |
|---|---|---|
| Transpay Holdings Ltd. | 16 000 | 40% |
| Brigidi Holdings Ltd. | 7100 | 17,75% |
| Farnon Management Ltd. | 3600 | 9% |
| TOTAL | 26 700 | 66,75% |
In addition, several members of the Board control some insignificant shares: Myrianthi Petrou is a Chairwoman of the Board who controls 0,0025% (1 share) and Andreas Christofi is a member of the Board who controls 0,0025% (1 share).
INTRAWARE GROUP
Consolidated financial statements for the year ended 31 December, 2021 in thousand EUR, unless otherwise stated
| 들은 일상을 받는 것을 알게 하는데 말을 맞았다. | ||||
|---|---|---|---|---|
| 28. Earnings per share | ||||
| 2021 | 2020 (restated) | |||
| Basic earnings per share | ||||
| from continuing operations, EURO | 87,05 | (11, 83) | ||
| Total basic earnings per share, EURO | 87,05 | (11, 83) |
Basic EPS is calculated by dividing the profit for the year attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the year. Group has no dilutive securities such as convertible securities, options and warrants on shares and
other rights, as well as contractual obligations for shares issue in future.
The following table reflects the income and share data used in the basic EPS computations:
| 2021 | 2020 (restated) | |
|---|---|---|
| Profit attributable to ordinary equity holders of the parent: | ||
| Continuing operations | 3482 | (473) |
| Profit attributable to ordinary equity holders of the parent for basic earnings |
3482 | (473) |
| Weighted average number of ordinary shares for basic EPS |
40 000 | 40 000 |
There have been no other transactions involving ordinary shares or potential ordinary shares between the reporting date and the date of authorization of these financial statements.
Management of the Group has chosen to operate each of the fitness clubs by separate legal entities that consolidate all the cash flows that are relevant for that component.
All the operating segments (fitness clubs) of the Group exhibit similar long-term financial performance as they have similar economic characteristics. Therefore, for the purposes of segment information disclosure the Group has aggregated all the operating segments being similar in each of the following respects:
The Group has designated the aggregated operating segments in Moscow (12 legal enities or 11 fitness clubs and one management company aggregated to a segment 'Fitness clubs in Moscow') and other regions of Russia (10 legal entities or 10 fitness clubs aggregated to a segment 'Fitness clubs in other regions') as separate reporting segments given that, according to perception of the management, these regions demonstrate different stages of economic development and therefore their economic performance may be different in the future.
Transactions between reportable segments and with other operating segments of the Group (primarily lease) are normally conducted under arm's length basis.
In 2020, the method of compilation the financial information in respect of operating segments used by management to make operating decisions has changed. The corresponding items of segment information for the previous reporting period were restated.
| in thousand EURO | Fitness clubs in Moscow |
Fitness clubs in other regions |
Other minor segments |
Total segments |
|---|---|---|---|---|
| Revenue from club cards sales | 13 048 | 6090 | $\mathbf{0}$ | 19 137 |
| Revenue from related sport services rendering |
10 431 | 4 3 8 8 | 631 | 15 450 |
| Revenue from retailing and food services |
990 | 417 | 96 | 1503 |
| Other revenue (operating lease and franchising) |
495 | 计连接器 医肩骨 医尿道 208 |
WELLENSTER | 751 |
| Revenues between operating segments of the Group |
1554 | 53 | 1800 | 3 4 0 8 |
| Total revenue | 26 519 | 11 156 | 2527 | 40 249 |
| Cost of goods sold, selling and and other administrative marketing expenses |
(27 251) | (11 420) | and became in (2.498) |
(41168) |
| Other income (expenses) | 1 400 | 663 | (2167) | (104) |
| Financial income and expenses | $\theta$ | $\boldsymbol{0}$ | $\theta$ | $\theta$ |
| Income tax gains (expenses) | 93 | 26 | (1) | 118 |
| Profit or loss for the segment | 760 | 426 | (2139) | (906) |
| Other segment information | ||||
| Total assets of the reportable segment | 17552 | 7675 | 17609 | 42837 |
| Total liabilities of the reportable segment |
22772 | 13 4 9 6 | 13 391 | 49 660 |
| in thousand EURO a surrous 1990. TaxWill Michigan a developer in 1990. |
Fitness clubs in Moscow |
Fitness clubs in other regions |
Other minor segments |
Total segments |
|---|---|---|---|---|
| Revenue from club cards sales | 18 913 | 8788 | (14432) | 13 26 9 |
| Revenue from related sport services rendering |
13 6 9 4 | 6710 | (10 253) | 10 15 1 |
| Revenue from retailing and food services |
1 3 4 6 | 626 START AND START |
(953) | 1 0 19 |
| Other revenue (operating lease and franchising) |
456 | 212 | ath abatan na khinin na dali n (322) |
345 |
| Revenues between operating segments of the Group |
791 | 21 | 1 0 5 2 CONTRACTOR |
1865 |
INTRAWARE GROUP
Consolidated financial statements for the year ended 31 December, 2021
| in thousand EUR, unless otherwise stated | ||
|---|---|---|
| Total revenue | 35 201 | 16 356 | (24908) | 26 649 |
|---|---|---|---|---|
| goods sold, selling Cost of and marketing and other administrative expenses |
(17341) | (8046) | (1940) | (27326) |
| Other income (expenses) | (132) | (21) | (67) | (220) |
| Interest income | ||||
| Interest expenses | ||||
| Income tax gains (expenses) | 102 | (34) | 67 | 135 |
| Profit or loss for the segment | 17830 | 8 2 5 6 | (26848) | (762) |
| Other segment information | ||||
| Total assets of the reportable segment | 17602 | 6970 | (20017) | 4555 |
| Total liabilities of the reportable segment |
15833 | 8550 | (32567) | (8184) |
During the period from October 5, 2021 till November 29, 2021 the Group obtained control over 14 fitness clubs:
The assets and liabilities recognized as a result of the control obtained over the companies are as follows:
| $31 - 1 - 1$ in thousand EUR |
2021 |
|---|---|
| Property, plant and equipment | החורים במחווי המונח החווי המונח האל המונח היה הגור 1922 |
| Right-of-use assets | 20 341 the control of the any area of the control |
| Deferred tax assets | 373 |
| Inventories | the property of the control of the control of the control of the control of the control of the control of the control of the control of the control of the control of the control of the control of the control of the control 116 |
| Accounts receivable | 990 |
INTRAWARE GROUP Consolidated financial statements for the year ended 31 December, 2021 in thousand EUR, unless otherwise stated
| Other assets | the control of other in the informa- | 2 2 6 0 |
|---|---|---|
| Cash | and the company of the company of the | 400 |
| Deferred tax liabilities | (166) | |
| Loans and borrowings | (8155) | |
| Long-term lease liabilities | (16660) | |
| Accounts payable proton in the same of the same lands are all the models of the proton | (4552) | |
| Deferred revenue | philode to much be the indicated provided a million of the second | (8908) |
| Net identifiable liability acquired | (12039) |
These business acquisitions in 2021 took place between parties under common control - therefore, unlike arm-length business acquisitions under IFSR 3, these assets and liabilities were not restated to fair value as at the date control was obtained, and no other additional assets and liabilities (e.g. goodwill and other internally-generated intangible assets) were recognized. Full amount of the net liability acquired has been recognized as a deduction in equity.
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the assets, and obligations for the liabilities, relating to the arrangement. In accordance with IFRS 11 certain activities of the subsidiary FOK "AK-Bars" in Kazan have been classified by the Group as a joint operation. The club operates in a building and uses in their work equipment owned by the partner of this joint operation. The Group has the full right to all assets and bears full responsibility for all liabilities presented in these financial statements. Under the agreement, the Group's share in the financial result of the club is 21%. Therefore, revenue and expenses are presented in the amount of 21% in the statement of comprehensive income.
The disclosures below summarize aggregated 100% financial position and 100% financial results of this joint operation:
| Financial position of the joint operation | ||
|---|---|---|
| in thousand EUR | 2021 | 2020 |
| Non-current assets | 463 | |
| Current assets | 473 | 266 |
| Total assets | 474 | 729 |
| Equity | 168 | 96 |
| Non-current liabilities | detection and a completed in the | 36 |
| Current liabilities | 306 | 597 |
| Total equity and liabilities | 474 | 729 |
| in thousand EUR | 2021 | 2020 |
|---|---|---|
| Revenue | 488 | 546 |
| Cost of Sales | (514) | |
| Selling and marketing expenses | The company's state | (11) |
| General administrative expenses | (496) | (14) |
| Net profit | (6) | |
|---|---|---|
| Income tax expense | $\overline{\phantom{a}}$ | |
| Other income (expense) | . |
In 2021 the management of the Group has decided to close the club and the leasing was terminated, and part of the assets were sold and part will be transferred to other clubs. The goodwill that relates to this club has been impaired (see note 10).
The operations of the Group are exposed to a number of financial risks. Major risks inherent to the Group's operations are credit risk, liquidity risk, foreign exchange risk, fair value interest rate risk, market risk, compliance risk, operational risk and cash flow interest rate risk.
The Group's financial risk management program is focused on the unpredictability of financial markets and is aimed at minimizing potential adverse effects on the Group's financial results. The Group's finance department is responsible for risk management; it develops general risk management principles and policies for solving specific risk-related issues.
Description of the Group's management of the above risks is presented below.
Foreign exchange risk is the risk that the fair value or future cash flows of a financial instrument will change as a result of a change in foreign exchange rates. The Group's exposure to the risk of changes in foreign exchange rates is presented in the table below.
The foreign currency risk is minimized by concluding contracts with customers and suppliers in the functional currency of the Group - Russian rubles.
| 31.12.2021 | 31.12.2020 (restated) |
31.12.2021 | 31.12.2020 (restated) |
|
|---|---|---|---|---|
| in thousand EUR | EUR | RUB | ||
| Cash | 66 | 911 | 956 | 614 |
| Accounts receivable | 582 | 1639 | 2 4 3 7 | 691 |
| Loans granted | 272 | 3 3 0 3 | 202 | 5656 |
| Trade financial instruments | 3 3 9 4 | 4 1 7 4 | ||
| Total financial assets | 4 3 1 5 | 10 0 26 | 3595 | 6962 |
| Accounts payable | (981) | (1062) | (46917) | (25523) |
| Loans received | (1836) | (728) | (1300) | |
| Total financial liabilities | (981) | (2898) | (47645) | (26823) |
| Total | 3 3 3 4 | 7 1 2 7 | (44050) | (19861) |
Foreign currency financial assets and liabilities (carrying value):
The following table demonstrates the sensitivity of changes in profit or loss and retained earnings caused by rises of USD and Euro exchange rates. Currency depreciation will have the same effect, but with a negative sign. These possible changes in exchange rates reflect the reasonable management assumption on the exchange rate volatility as at the reporting date. Since the net position of the Group in regard to financial instruments denominated in foreign currency is positive or insignificantly negative, the increase of the exchange rate will increase profits, and the decrease of the exchange rate will cause losses.
Sensitivity to increase of the exchange rates:
| in thousand EUR | 31.12.2021 | 31.12.2020 |
|---|---|---|
| Euro exchange rate - increase 10% | 328 | 701 |
Interest rate risk is related to the changes in fair value (financial instruments with floating interest rates) or future cash flows (financial instruments with fixed interest rates) because of changes in market interest rates. The structure of the Group's loans and borrowings by type of interest rate is presented in the table below.
| in thousand EUR | 31.12.2021 | 31.12.2020 (restated) |
|---|---|---|
| Loans and borrowings (issued) with fixed interest rate | 474 | 8958 |
| Loans and borrowings (received) with fixed interest rate | (728) | (3136) |
| Except for the loans received with a zero-interest rate | ||
| Total | (254) | 5822 |
Credit risk arises when a failure by counter parties to discharge their obligations could reduce the amount of future cash inflows from financial assets on hand at the reporting date. The Company has significant concentration of credit risk relating to cash at bank and receivables from related and third parties. The Company has policies in place to ensure that it monitors on a continuous basis the ageing profile of its receivables.
The Group's maximum exposure to credit risk by class of assets equals to the carrying amounts of financial assets in the statement of financial position as follows:
| in thousand EUR | As at 31.12.2021 | As at 31.12.2020 (restated) |
|
|---|---|---|---|
| Long-term loans issued | EXTREME THE UP THIS | 2 2 8 6 | |
| Short-term accounts receivable | 3019 | 2329 | |
| Short-term loans issued a for the search of believe the property of the search of |
474 | 6673 | |
| Trade financial instruments | 3 3 9 4 | 4 1 7 4 | |
| Cash | 1 0 2 3 | 1525 |
INTRAWARE GROUP
Consolidated financial statements for the year ended 31 December, 2021 in thousand EUR, unless otherwise stated
| $\mathbf{m}$ ' ota 1 |
7011 | . $\Omega$ $\Omega$ . 6 ω. - |
|---|---|---|
The table below shows the balances of the Group's bank accounts as at the reporting date. Cash
| in thousand EUR | Moody's rate | As at 31.12.2021 | As at 31.12.2020 (restated) |
|
|---|---|---|---|---|
| OJSC "Sberbank of Russia" | B 3 , stable | 628 | 412 | |
| Eurobank Cyprus Ltd | Caa 3 | June 1930 & 1000 10 congress 10 66 |
905 | |
| OJSC "AK Bars" Bank | B1, positive | $\theta$ | 90 | |
| OJSC "Alfa Bank", Rostov branch | Ba1, stable | 23 | ||
| JSC VTB Bank | Baa3, stable | 74 | 49 | |
| Total | 791 | 1465 |
The management of the Group believes that there are no reasons to think that any of counterparties have indicators of failing to fulfill its obligations regarding financial instruments in the future. Analysis of the quality of financial assets is shown in the table below.
| 2021 | 2020 (restated) | ||||
|---|---|---|---|---|---|
| in thousand EUR | Accounts receivable |
Loans issued |
Accounts receivable |
Loans issued |
|
| Current, not past due and not impaired | 1 0 28 | 474 | 1485 | 6673 | |
| Past due, but not impaired: | |||||
| • past due less than 30 days | 69 | ||||
| · past due 30-90 days | 441 | 88 | |||
| · past due 90-180 days | 244 | ||||
| · past due 180-360 days | 956 | 86 | |||
| Total past due, but not impaired | 1465 | 418 | |||
| Individually impaired (nominal amount): | |||||
| Total individually impaired | 526 | 570 | 426 | 682 | |
| Allowance for impairment | (526) | (570) | (426) | (682) | |
| Total | 3019 | 474 | 2 3 2 9 | 6673 |
The Group does not have overdue loans and borrowings received at the reporting date.
Capital includes equity shares and Additional paid-in capital as well as other capital components.
Share capital of Intraware Investments Public Ltd meets all regulatory Cypriot requirements.
The Group manages its capital to ensure that it will be able to continue as a going concern while maximizing the return to shareholders through the optimization of the debt and equity balance.
Market risk is the risk that changes in market prices, such as interest rates, equity prices and foreign exchange rates, will affect the Group's income or the value of its holdings of financial instruments.
Liquidity risk is the risk that the Group will be unable to repay its liabilities. Prudent liquidity risk management implies maintaining sufficient cash and cash equivalents and access to funding through open credit facilities and the possibility of operational management in the event of a misbalance. The Group management exercises careful control over liquidity status. The Group developed a budgeting system that includes planning cash flows and controls in order to ensure the necessary funds to meet financial needs.
Management of the Group also monitors the amounts of financing, current investment expenditures and debt financing on a daily basis, monitors revenue and analyses expenditure structure, and monitors meeting the planned results for timely debt repayment.
The table below breaks down the Group's financial liabilities by maturity (liquidity) categories determined by contractual terms of payments. The data in the table below is undiscounted cash flows. Cash flows arising within 12 months after the balance sheet date are approximately equal to their carrying balances as the impact of discounting is not significant.
As at 31 December 2021 the Group's current liabilities exceed the current assets for the amount of EUR 24 590 thousand (as at 31 December 2020 - EUR 11 048 thousand). This fact indicates a material uncertainty that may raise significant doubt on the ability of the Group to continue as a going concern, as well as on the ability to realize its assets and repay its liabilities in the normal course of business (see also par. «Going concern» in the section «III. Basis of preparation»).
The line "Accounts payable" includes all accounts payable of the Group except for those that do not correspond the definition of the financial instrument, therefore, with the exception of advances received and tax liabilities.
| in thousand EUR | Less than 1 month (and past due) |
1-6 months | 6 months to 1 year |
1-5 years | Over 5 years |
Total |
|---|---|---|---|---|---|---|
| Accounts payable | 1 3 5 1 | 1 3 4 6 | 1880 | 598 | 5 1 7 5 | |
| Lease liabilities | 885 | 5 2 6 7 | 5 3 0 0 | 38 1 24 | 12 18 1 | 61757 |
| Loans and borrowings received |
5 | 139 | 584 | 728 | ||
| Total financial liabilities |
2 2 4 1 | 6 751 | 7764 | 38722 | 12 18 1 | 67 660 |
| in thousand EUR | Less than 1 month (and past due) |
1-6 months | 6 months to 1 year |
1-5 years | Over 5 years |
Total |
|---|---|---|---|---|---|---|
| Accounts payable | 554 | 528 | 4 2 5 5 | 515 | 5852 | |
| Lease liabilities | 366 | 2040 | 2730 | 16 658 | 8073 | 29 866 |
| Loans and borrowings received |
2845 | 291 | - | 3 1 3 6 |
INTRAWARE GROUP
Consolidated financial statements for the year ended 31 December, 2021 in thousand EUR, unless otherwise stated
| Total financial | ັ | 10 | |||
|---|---|---|---|---|---|
| liabilities | 840 | 112 | 16 658 | 8073 | 43 301 |
Compliance risk is the risk of financial loss, including fines and other penalties, which arises from non-compliance with laws and regulations of the state. The risk is limited to a significant extent due to the supervision applied by the Compliance Officer, as well as by the monitoring controls applied by the Group.
Operational risk is the risk that derives from the deficiencies relating to the Group's information technology and control systems as well as the risk of human error and natural disasters. The Group's systems are evaluated, maintained and upgraded continuously.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.
Fair value measurement assumes that the transaction to asset sell or liability transfer occurs:
Financial assets and liabilities of the Group are not traded on active markets. Therefore, the fair value of financial assets and liabilities of the Group are determined in accordance with generally accepted pricing models based on discounted cash flow analysis using prices that are used in existing transactions on the current market.
Assets and liabilities whose fair value is estimated or disclosed in the financial statements are classified as described below under the fair value hierarchy based on the data of the lowest level input that is significant to the fair value measurement in general:
Classifying financial instrument to any of the category of the fair value hierarchy, Group use an appropriate judgment. If observable data that require significant adjustment is used in fair value measurement, the financial instrument needs to be classified to Level 3. The Russian Federation continues to display some characteristics of an emerging market and economic conditions continue to limit the volume of activity in the financial markets. Market quotations may be outdated or reflect distress sale transactions and therefore not represent fair values of financial instruments.
Management has used all available market information in estimating the fair value of financial instruments.
The tables below shows the hierarchy of the data sources used for the recognition or disclosure of assets and liabilities fair value of the Group.
Multiple estimates of fair value are estimates required or permitted by IFRS in the statement of financial position at the end of each reporting period. Single estimates of fair value are estimates required or permitted by IFRS in the statement of financial position at the end of the period under certain conditions. As at the reporting date the Group had no financial assets and liabilities that require multiple and single estimates of fair value as at the reporting date.
(ii) Assets and liabilities that are not measured at fair value but disclosed at fair value.
At the Level 2 and Level 3 of the fair value hierarchy its estimation has been performed using method of discounted cash flows. Fair value of unquoted financial instruments with floating interest rate was assumed equal to the book value. The fair value of unquoted instruments with fixed interest rate is based on the method of discounted cash flows using current market interest rates for new instruments with similar credit risk and maturity.
Financial instruments carried at fair value. Cash and cash equivalents are carried at cost which approximates the current fair value.
Financial assets carried at amortized cost. The fair value of floating rate instruments is normally their carrying amount. The estimated fair value of fixed interest rate instruments is based on estimated future cash flows expected to be received discounted at current interest rates for new instruments with similar credit risk and remaining maturity. Discount rates used depend on the credit risk of the counterparty.
Financial liabilities carried at amortized cost. Fair values of liabilities are determined using valuation techniques. The estimated fair value of fixed interest rate instruments with stated maturities was estimated based on expected cash flows discounted at current interest rates for instruments with similar credit risk and remaining maturity.
| of completely off- | Carrying amount | Fair value | Initial | Valuation | |||
|---|---|---|---|---|---|---|---|
| in thousand EUR | 31.12.2021 | 31.12.2020 (restated) |
31.12.2021 | 31.12.2020 (restated) |
Level | data | method |
| Financial assets | are a relevant to confluence in that only the meetings. | ||||||
| Long-term loans issued |
2 2 8 6 | 2 2 8 6 | Level 3 | Market loan rates |
Discounted Cash Flows |
||
| Short-term accounts receivable |
$\overline{\phantom{a}}$ | Level 3 | Market loan rates |
Discounted Cash Flows |
|||
| Short-term loans issued |
3019 | 2329 | 3019 | 2 3 2 9 | Level 3 | Market loan rates |
Discounted Cash Flows |
| Trade financial instruments |
474 | 6673 | 474 | 6 6 7 3 | Level 1 | ||
| Cash | 3 3 9 4 | 4 1 7 4 | 3 3 9 4 | 4 1 7 4 | Level 2 | ||
| Total financial assets |
1 0 23 | 1525 | 1 0 23 | 1525 |
The Group has the following categories of financial instruments:
| an illustration. Sushing which are the company's proportional Financial liabilities at amortized cost |
||||||||
|---|---|---|---|---|---|---|---|---|
| Long-term loans and borrowings received |
Level 3 | Market loan rates |
Discounted Cash Flows |
|||||
| Long-term accounts payable |
(33736) | (16064) | (33736) | (16064) | Level 3 | Market loan rates |
Discounted Cash Flows |
|
| Short-term loans and borrowings received |
(728) | (3136) | (728) | (3136) | Level 3 | Market loan rates |
Discounted Cash Flows |
|
| Short-term accounts payable |
(14162) | (10521) | (14162) | (10521) | Level 3 | Market loan rates |
Discounted Cash Flows |
|
| Total financial liabilities at amortised cost |
(48626) | (29721) | (48626) | (29721) |
Contingent liabilities on litigations. From time to time in the normal course of business, the Group gets claims. Based on its own estimates and both internal and external professional advice, the management believes that no material losses will arise in respect of claims therefore there were no provisions as well as contingent liabilities on litigations.
Contingent liabilities on tax risks. Russian tax, currency and customs legislation is subject to varying interpretation, and changes, which can occur frequently. Management's interpretation of such legislation as applied to the transactions and activity of the Group may be challenged by the regional and federal authorities. Recent events in Russia suggest that the tax authorities may be taking a more assertive position in their interpretation of legislation and their assessments, and it is possible that transactions and activities that have not been challenged in the past may be challenged. As a result, significant additional taxes, penalties and interest may be assessed. Fiscal periods remain open to review by the authorities in respect to taxes for three calendar years preceding the year of review. Under certain circumstances, reviews may cover longer periods. Management believes that the Group has no possible unaccounted tax obligations that have not been provided for in these consolidated financial statements.
Guarantees. During 2020-2021 years the Group did not issue or received any guarantees.
Assets pledged as security. The Group had no pledged assets as at 31 December 2021 and as at 31 December 2020 years.
Other commitments. The Group had no capital or other commitments as at 31 December 2021 and as at 31 December 2020.
In February 2022, after the situation in Ukraine escalated, sanctions were imposed by the United States, the European Union and some other countries. This may have a serious negative impact on the economy of Russia.
According to estimates of the Group's management, the possible negative impact of these circumstances on the Company's operations and financial position will be insignificant. The actual impact of future business environment may differ from management's assessment.
There were no other events after the reporting date that had or may have an impact on the Group's financial position, cash flows or results of operations between the reporting date and the date of signing the financial statements for the reporting year.
Director
Myrianthi Petrou
Andreas Christofi
Director
$\overline{\phantom{a}}$
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