Malita Investments Plc

Interim / Quarterly Report • Aug 28, 2024

COMPANY ANNOUNCEMENT

MALITA INVESTMENTS P.L.C. (THE "COMPANY")

Approval of unaudited condensed Interim Financial Statements

Date of Announcement	28 August 2024
Reference	133/2024
Capital Markets Rule	5.16.4

QUOTE

The Board of Directors of Malita Investments p.l.c. (the "Company") hereby announces that today, the 28 August 2024, it approved the Company's unaudited condensed Interim Financial Statements for the sixmonth period ended 30th June 2024. The Interim Financial Statements are attached herewith and are also available for viewing at the Company's registered office or electronically at https://malitainvestments.com/investor-category/financial-statements/.

The Directors of the Company have also approved the payment of a gross interim dividend of €2,748,327 or €0.0132 per share equating to a net interim dividend of €1,786,413 or €0.0086 per share, payable on the 2 October 2024 to the shareholders of the Company on the Company's share register at the Malta Stock Exchange as at close of business on 11 September 2024.

UNQUOTE

By Order of the Board

Signed

Donald Vella Company Secretary

MALITA INVESTMENTS P.L.C.

Condensed Interim Financial Statements (unaudited) 30 June 2024

	Pages
Interim Directors' report	1 - 4
Report on review of interim financial information	5
Condensed statement of financial position	6 - 7
Condensed statement of comprehensive income	8
Condensed statement of changes in equity	9
Condensed statement of cash flows	10
Notes to the condensed interim Financial Statements	11 - 31

Interim Directors' Report

The Directors present their report together with the condensed interim Financial Statements for the period ended 30 June 2024.

Principal activities

The principal activities of Malita Investments p.l.c. (the Company) include the financing, acquisition, development, management and operation of immovable property, in particular, projects of national and/or strategic importance.

Review of the business

The Company registered a loss for the period from January to June 2024 of €3,617,590 (June 2023: profit €10,444,436). The operating profit excluding any fair value movements for the period amounts to €4,319,768 (June 2023: €4,138,797).

As mentioned above and further explained in Note 4, the result for the period includes an adverse movement in the fair value of the MIA and VCP properties as well as the Parliament Building and Open-Air Theatre amounting to €6,824,000 and €1,867,898 respectively. This has been transferred to a non-distributable fair value reserve (net of deferred tax).

The negative fair value adjustment is an accounting entry required by applicable financial reporting standards and does not reflect the underlying operational performance or true profitability of the business. Excluding the effect of this non-cash adjustment, the Company continues to perform strongly, maintaining stable revenue streams and effective operational management. Furthermore, during the period under review, the Company continued receiving lease income in respect of the Open-Air Theatre and Parliament Building in City Gate, Valletta and ground rent from the MIA and VCP properties.

In the first half of 2024, the housing project achieved unprecedented progress, marking its most significant milestone to date, with a total of 240 units completed. This development resulted in the total number of completed units reaching 366, almost tripling since December 2023 (126 units). Additionally, in the period under review, 192 garages and car spaces were made available across the various sites, enhancing the overall infrastructure of the Project and maximising revenue for the Company.

The below table shows a detailed breakdown of all sites which have been handed over to tenants.

	Site Location	Number of Units	Number of garages/car spaces	Contracts with Tenants
	Birkirkara	73	રેસ	August 2022
2	Kirkop C	8	6	February 2023
3	Attard	8	3	March 2023
4	Zebbug	8	6	March 2023
5	Kirkop B	18	0	June 2023
6	Qrendi C	11		December 2023
7	Zurriea	27	20	January 2024
8	Kirkop D	8	8	April 2024
9	Msida	102	22	April 2024
10	Kirkop A	18	21	May 2024
11	Siggiewi	84	121	May 2024
	Total	366	270

Interim Directors' Report - continued

Review of the business - continued

During 2024, the company is expecting further expansion, with 69 units in Cospicua, projected to be completed by November 2024. Furthermore, another 24 units in Qrendi A are scheduled for handover to tenants in the following year, with an expected completion date of July 2025. The Luqa site, the largest site within the housing project, is expected to be fully delivered by October 2026.

The below table shows a detailed breakdown of the remaining sites which are still to be completed/handed over to tenants.

	Site Location	Number of Units	Number of garages/car spaces	Expected Completion
12	Qrendi B	26	20	August 2024*
13	Cospicua	ea	107	November 2024
14	Qrendi A	24	14	July 2025
15	Luda	267	287	October 2026
	Total	386	428

*Qrendi B has been completed during the month of August with tenants expected to be done during the month of September.

These advancements underscore a steadfast commitment to meeting the demand for high-quality housing and continuously enhancing service offerings. To further prioritise the timely and efficient delivery of these projects, during the month of August the Company employed a Chief Operating Officer (COO) whose primary focus will be on ensuring the successful and timely completion of our developments. The progress made thus far and the ambitious plans ahead reflect the company's dedication to excellence and growth.

Furthermore during the first half of 2024, the Company gave effect to a Rights Issue and subsequent issue and allotment of New Ordinary Shares in the issued share capital of the Company. This helped the Company raise €29.9 million (net of sales commission). Upon the listing of the New Ordinary Shares on the Official List of the Malta Stock Exchange, the total issued share capital of the Company increased to €104. 103.297 divided into 208,206,593 Shares of a nominal value of €0.50 per share, held as follows:

• · Government of Malta 170,600,536 Shares representing 81.94% of the total issued share capital of the Company; and
• · General public 37,606,057 Shares representing 18,06% of the total issued share capital of the Company.

Through the funds raised from the Rights Issue along with the credit agreement entered into with the European Investment Bank of €22 million, the Board and management have continued to address the financing gap attributable to capital expenditure required for the Housing Project. Other discussions with financial institutions are at an advanced level and management has correspondence in hand indicating that the remaining funds have been conceptually approved, providing assurance for completion across all sites. It is always on the agenda of the Board of Directors to analyse and assess other possible investment opportunities.

On 30th May 2024, the Company held the annual AGM whereby the board composition was approved. The Board of Directors of the Company shall be made up of six (6) Directors, with Dr Johan Farrugia being appointed as chairman, legal and judicial representative of the Company.

Interim Directors' Report - continued

Review of the business - continued

Result and dividends

The condensed statement of comprehensive income is set out on page 8. On 28 August 2024, the Directors declared the payment of an interim gross dividend of €2,748,327 or €0.0132 per share (June 2023: €1,955,026 or €0.0132 per share) equating to an interim net dividend of €1,786,413 or €0.0086 per share (June 2023: €1,270,767 or €0.00858 per share) payable on 2 October 2024.

Directors

The Directors of the Company who held office during the period were: Johan Farrugia (appointed 30 May 2024) Marlene Mizzi (not re-appointed) David Mallia (nomination for re-election not submitted) Robert Suban Victor Carachi Tania Brown Miguel Borg Desiree Cassar

The Company's Articles of Association require Directors to relire after three years in office, but they are eligible for re-appointment.

Statement of Directors' responsibilities for the financial statements

The Directors are required by the Maltese Companies Act (Cap. 386) to prepare financial statements which give a true and fair view of the state of affairs of the Company as at the end of each reporting period and of the profit or loss for that period.

In preparing the financial statements, the Directors are responsible for the following matters:

• ensuring that the financial statements have been drawn up in accordance with International Financial Reporting Standards as adopted by the EU;
• selecting and applying appropriate accounting policies;
• making accounting estimates that are reasonable in the circumstances;
• · ensuring that the financial statements are prepared on the going concern basis unless it is inappropriate to presume that the Company will continue in business as a going concern.

The Directors are also responsible for designing, implementing internal controls as the Directors determine is necessary to enable the preparation of financial statements that are free from material misstatements, whether due to fraud or error, and that comply with the Maltese Companies Act (Cap. 386). They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

The financial statements of Malita Investments p.l.c. for the period ended 30 June 2024 are included in the condensed interim financial statements - 30 June 2024, which is available on the Company's website. The Directors are responsible for the maintenance and integrity of the Company's website.

Interim Directors' Report - continued

Statement of Directors' responsibilities for the Financial Statements - continued

Access to information published on the Company's website is available in other countries and jurisdictions, where legislation governing the preparation and dissemination of financial statements may differ from requirements or practice in Malta.

On behalf of the board

Johan Farrugia Chairman

Robert Suban Director

Registered office: Clock Tower Level 1 Tigne` Point Sliema Malta

28 August 2024

Report on review of interim financial information

To the shareholders and board of directors of Malita Investments p.l.c.

Introduction

We have reviewed the accompanying condensed interim statement of financial position of Malita Investments p.l.c. as at 30 June 2024 and the related condensed interim statements of comprehensive income, changes in equity and cash flows for the six-month period then ended, and notes, comprising significant accounting policies and other explanatory notes . Management is responsible for the preparation and presentation of this condensed interim financial information in accordance with International Accounting Standard 34, 'Interim financial reporting'. Our responsibility is to express a conclusion on this condensed interim financial information based on our review.

Scope of review

We conducted our review in accordance with International Standard on Review Engagements 2410, 'Review of interim financial information performed by the independent auditor of the entity'. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe that the accompanying condensed interim financial information is not prepared, in all material respects, in accordance with International Accounting Standard 34, "Interim financial reporting'.

Other matters

This report, including the conclusion, has been prepared for and only for the Company and for no other purpose. We do not, in producing this report, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

PricewaterhouseCoopers

78 Mill Street Zone 5, Central Business District Qormi CBD 5090 Malta

Stephen Mamo Parther

28 August 2024

Condensed Interim Financial Statements - 30 June 2024

oondenseu Statement of miantilal position
		As at	As at
		30 June	31 December
		2024	2023
	Notes	ਵ
			ਵ
		(unaudited)	(audited)
ASSETS
Non-current assets
		35,842	45,296
Property, plant and equipment
Investment property	4	212,416,922	221,108,820
Contract asset	6	77,982,400	66,283,697
		290,435,164	287,437,813
Current assets
Cash and cash equivalents		1,464,297	4,785,663
Financial assets at fair value through profit and loss	7	19,616,476
Trade and other receivables		1,135,164	774,795
		22,215,937	5,560,458
Total assets		312,651,101	292,998,271
EQUITY AND LIABILITIES
Capital and reserves
Share capital	రి	102,739,614	73,295,143
Retained earnings	9	16,589,928	16,363,378
Non-distributable reserve - fair value movements	10	64,460,934	72,475,183
Non-distributable reserve - other	11	5,202,994	4,890,952
		188,993,470
Total equity			167,024,656
Non-current liabilities
Borrowings	12	82,583,377	85,885,646
Lease liability	5	3,372,379	3,357,832
Capital creditors	13	825,867	1,086,455
Provision for liabilities and charges	14	489,271	301,590
Provision on restoration	ട	5,911,773	5,788,962
Deferred tax liabilities	21	16,528,884	17,206,534
		109,711,551	113,627,019
Current liabilities
Borrowings	12	4,193,084	3,701,832
	5		121,551
Lease liability		121,551
Capital creditors	13	6,980,200	6,227,116
Trade and other payables		1,578,472	1,628,799
Current tax liabilities		1,072,773	667,298
		13,946,080	12,346,596
Total liabilities
		123,657,631	125,973,615
Total equity and liabilities		312,651,101	292,998,271

රි

Condensed statement of financial position - continued

The notes on pages 11 to 31 are an integral part of these condensed interim financial statements.

The condensed interim financial statements on pages 6 to 31 were authorised for issue by the Board on 28 August 2024 and were signed on its behalf by:

Johan Farrugia Chairman

Robert Suban Director

Condensed statement of comprehensive income

		Period from 1 January to 30 June 2024	Period from 1 January to 30 June .2023
	Notes	€	ਵ
		(unaudited)	(unaudited)
Revenue	15	4,499,981	4,468,620
Revenue from service concession arrangements	ರ್	10,845,719	5,868,090
Costs related to service concession arrangements	હ	(10,422,462)	(5,654,289)
Administrative expenses	16	(603,470)	(543,624)
Operating profit		4,319,768	4,138,797
Change in fair value of investment property	র্ব	(8,691,898)	7,297,691
Finance income	19	2,100,828	1,348,309
Finance costs		(989,788)	(853,345)
(Loss) /Profit before tax		(3,261,090)	11,931,452
Tax expense	20	(356,500)	(1,487,016)
(Loss) / Profit for the period - total comprehensive loss		(3,617,590)	10,444,436
(Loss) / Profit per share in cents	22	(1.74)	7.05

The notes on pages 11 to 31 are an integral part of these condensed interim financial statements .

Condensed statement of changes in equity
				Non-distributable reserves
		Share	Retained	Fair value
		capital	earnings	movements	Other	Total
	Notes	(1)	e	. €	€	e
Balance at 1 January 2023		73,295,143	12,334,978	55,765,420 4,345,257		145,740,798
Comprehensive income
Profit for the period			10,444,436			10,444,436
Transactions with owners
Transfer within owners' equity	10		(6,759,941)	6,759,941
Transfer within owners' equity	11		(263,892)		263,892
Dividends to equity shareholders			(2,098,691)			(2,098,691)
Balance as at 30 June 2023 (unaudited)		73,295,143	13,656,890	62,525,361 4,609,149		154,086,543
Balance at 1 July 2023		73,295,143	13,656,890	62,525,361 4,609,149		154,086,543
Comprehensive income
Profit for the period			14,208,878
						14,208,878
Transactions with owners
Transfer within owners' equity	10		(9,949,822)	9,949,822
Transfer within owners' equity	11
			(281,803)		281,803
Dividends to equity shareholders		l	(1,270,765)			(1,270,765)
Balance as at 31 December
2023 (audited)		73,295,143	16,363,378	72,475,183 4,890,952		167,024,656
Balance at 1 January 2024		73,295,143	16,363,378	72,475,183 4,890,952		167,024,656
Comprehensive income
Profit for the period			(3,617,590)
						(3,617,590)
Additional Rights issue		30,049,265				30,049,265
Rights issue cost		(604,794)				(604,794)
Transactions with owners
Transfer within owners' equity	10		8,014,249	(8,014,249)
Transfer within owners' equity	11		(312,042)		312,042
Dividends to equity shareholders	23		(3,858,067)			(3,858,067)
Balance as at 30 June 2024 (unaudited)		102,739,614	16,589,928	64,460,934 5,202,994		188,993,470

---

The notes on pages 11 to 31 are an integral part of these condensed interim financial statements.

		Period from 1 January to 30 June 2024	Period from 1 January to 30 June 2023
	Notes	ਵ	€
		(unaudited)	(unaudited)
Cash flows from operating activities
Cash generated from operations	24	3,819,523	3,267,168
Proceeds from affordable housing rentals		1,127,836	463,710
Interest paid and similar charges		(5,250)	(1,047)
Income taxes paid		(628,674)	(570,000)
Net cash generated from operating activities		4,313,435	3,159,831
Cash flows from investing activities
Purchase for property, plant and equipment			(19,180)
Payments to acquire contract asset		(9,055,418)	(4,703,650)
Purchase of financial assets at fair value
through profit and loss		(25,000,000)
Disposal of investments including realised gain		5,500,107
Net cash used in investing activities		(28,555,311)	(4,722,830)
Cash flows from financing activities
Repayment of borrowings		(2,811,017)	(1,105,424)
Interest paid on borrowings		(1,861,381)	(1,689,123)
Dividends paid to equity holders	23	(3,851,563)	(2,089,489)
Interest received			48,668
Issuance of Rights Issue		29,444,471
Net cash from / (used in) financing activities		20,920,510	(4,835,368)
Net movement in cash and cash equivalents		(3,321,366)	(6,398,387)
Cash and cash equivalents at beginning of period		4,785,663	17,363,936
Cash and cash equivalents at end of period		1.464.297	10.965.569

Condensed statement of cash flows

The notes on pages 11 to 31 are an integral part of these condensed interim financial statements .

Notes to the Condensed Interim Financial Statements

1. Summary of material accounting policies

The Board has adopted the following principal accounting policies which it believes cover most of the type of activities it will undertake in the foreseable future. Accordingly, not all the accounting policies set out below would necessarily apply as at the date of this report.

1.1 Basis of preparation

These condensed interim financial statements for the six months ended 30 June 2024 have been prepared in accordance with IAS 34, 'Interim financial reporting'. They have been prepared under the historical cost convention as modified by fair valuation of investment property.

The condensed interim financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2023, which have been prepared in accordance with IFRS.

The condensed interim financial statements have been reviewed, not audited.

The preparation of financial statements in conformity with IFRSs as adopted by the EU requires the use of certain accounting estimates. It also requires Directors to exercise their judgement in the process of applying the Company's accounting policies (see note 2 - Critical accounting estimates and judgements).

The financial statements have been prepared on a going concern basis that assumes that the Company will continue in operational existence for the foreseeable future.

Standards, interpretations and amendments to published standards effective in 2024

The Company adopted new standards, amendments and interpretations to existing standards that are mandatory for the Company's accounting period beginning on 1 January 2023. The adoption of these revisions to the requirements of IFRSs as adopted by the EU did not result in substantial changes to the Company's accounting policies.

Standards, interpretations and amendments to published standards that are not yet effective

Certain new standards, amendments and interpretations to existing standards have been published by the date of authorisation for issue of these Financial Statements but are mandatory for the Company's accounting periods beginning after 1 January 2024. The Company has not early adopted these revisions to the requirements of IFRSs as adopted by the EU.

1.2 Investment property

Investment property is held for long-term rental yields or for capital appreciation or both and is not occupied by the Company. Investment property also includes property that is being constructed or developed for future use as investment property, when such identification is made.

Investment property is measured initially at its historical cost, including related transaction costs and borrowing costs. Historical cost includes expenditure that is directly attributable to the acquisition of the items. Borrowing costs which are incurred for the purpose of acquiring or constructing a qualifying investment property are capitalised as part of its cost, in accordance with Note 1.10. After initial recognition, investment property is carried at fair value. Given that there is no active market for the investment property held by the Company establishes fair value by using valuation techniques, particularly discounted cash flow analysis.

1.2 Investment property - continued

Investment property that is being redeveloped for continuing use as investment property continues to be measured at fair value measurement on property under construction is only applied if the fair value is considered to be reliably measurable. The fair value of investment property reflects, among other things, rental income from current leases and assumptions about rental income from future leases in the light of current market conditions. The fair value also reflects on a similar basis, any cash outflows that could be expected in respect of the property.

Subsequent expenditure is capitalised to the asset's carrying amount only when it is probable that future economic benefits associated with the expenditure will flow to the Company and the cost of, the item can be measured reliably. All other repairs and maintenance costs are charged to profit or loss during the financial period in which they are incurred. When part of an investment property is replaced, the carrying amount of the replaced part is derecognised.

Changes in fair values are recognised in the income statement properties are derecognised either when they have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal.

1.3 Contract asset

The Company is recognising a contract asset in its statement of financial position to account for the Affordable housing project during its construction period. The carrying amount of the contract asset is equal to the total costs incurred on this project, profit on the completed construction and financing revenue.

1.4 Financial assets

1.4.1 Classification, recognition and measurement

The classification of financial assets depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition. The Company's financial assets consist of receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the Company provides money, goods or services directly to a debtor with no intention of trading the asset. They are included in current assets, except for maturities greater than twelve months after the end of the reporting period. The latter are classified as non-current assets. The Company's receivables comprise trade and other receivables and cash and cash equivalents in the statement of financial position (Notes 1.4.2 and 1.4.3). Cash and cash equivalents includes cash in hand, deposits held with banks with original maturities of six months or less.

The Company recognises a financial asset in its statement of financial position when it becomes a party to the contractual provisions of the instrument. Financial assets are initially recognised at fair value plus transaction costs. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Company has transferred substantially all risks and rewards of ownership or has not retained control of the asset.

The Company's financial assets measured at amortised cost are subsequently carried at amoriised cost using the effective interest method. Amortised cost is the initial measurement amount adjusted for the amortisation of any difference between the initial and maturity amounts using the effective interest method.

1.4.1 Classification, recognition and measurement - continued

Debt instruments

Subsequent measurement of debt instruments depends on the Company's business model for managing the asset and the cash flow characteristics of the Company's debt instruments comprise investments in treasury bills. Accordingly, these investments are considered to be debt instruments from the Company's perspective.

There is one measurement category into which the Company classify its debt instruments:

· FVTPL: Financial assets that do not meet the criteria for amortised cost or FVOC1 are measured at fair value through profit or loss (FVTPL). A gain or loss on a debt investment that is subsequently measured at FVTPL is recognised in profit or loss and presented net within net changes in fair value of financial assets in the period in which it arises.

1.4.2 Trade and other receivables

Trade receivables comprise amounts due from customers for ground rents and lease of property. If collection is expected in one year or less (or in the normal operating cycle of the business if longer), they are classified as current assets. If not, they are presented as non-current assets.

Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. In the Directors, the recorded book value in the Company's books of trade and other receivables and their value measured at amortised cost using the effective interest method, less provision for impairment are not materially different. The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in the income statement. When a receivable is uncollectible, it is written off against the allowance account for trade and other receivables. Subsequent recoveries of amounts previously written off are credited against profit or loss.

1.4.3 Cash and cash equivalents

Cash and cash equivalents are carried in the statement of financial position at face value. In the statement of cash flows, cash and cash equivalents includes cash in hand, deposits held at call with banks and when applicable bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the statement of financial position.

1.5 Service Concession Arrangements

Under the terms of IFRIC 12, "Service Concession Arrangements', a concession operator has a twofold activity:

• a construction activity in respect of its obligations to design, build and finance a new asset that it delivers to the grantor: revenue is recognised over time in accordance with IFRS 15;
• an operating and maintenance activity in respect of concession assets: revenue is recognised in accordance with IFRS 15.

In return for its activities as operator, the Company will receive remuneration from the grantor and therefore IFRIC 12's financial asset model applies. Under this model, the operator has an unconditional contractual right to receive payments from the concession grantor, irrespective of the amount of use made of the infrastructure.

1.5 Service Concession Arrangements - continued

The operator recognises a financial asset, attracting interest, in its statement of financial position, in consideration for the services it provides (design, construction, etc.). Such financial assets are recognised in the statement of financial position as a contract asset, in an amount corresponding to the fair value of the infrastructure on first recognition and subsequently at amortised cost. The receivable will in substance, be settled by the operator's right to retain all rental payments to be affected by users upon completion; such payments will be received partly from users and partly from the grantor. Finance income calculated on the effective interest method is recognised under finance income in the Statement of comprehensive income.

The part of the investment that is covered by an unconditional contractual right to receive payments from the grantor (in the form of rental) is recognised as a contract asset up to the amount guaranteed. Once the development is completed, the Company will have a right to invoice tenants based on the contractual price. In line with the IFRIC 12 model and IFRS 15, the amount which the Company has a right to invoice will be presented as a financial asset (receivable) with a corresponding entry against the contract asset recognised during the construction phase.

1.6 Share capital

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

1.7 Trade and other payables

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

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

1.8 Current and deferred tax

The tax expense for the year comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is also recognised in other comprehensive income or in equity.

Deferred tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the transaction affects neither accounting, nor taxable profit or loss. Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the end of the reporting period and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

Deferred tax assets are recognised only to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the same taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

1.9 Revenue recognition

Revenue comprises the fair value for ground rents receivable as per contracts entered into, leases of the Parliament Building on the initial and additional investment and the lease of the Open-Air Theatre. Moreover, the Company is recognising revenue in relation to the Service concession arrangement (Note 6) as performance obligations are satisfied.

The Company recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and when specific criteria have been met for each of the Company's activities as described below.

(a) Finance income

Interest income is recognised for all interest-bearing instruments using the effective interest method. The effective interest method of calculating the amortised cost of a financial asset and of allocating the interest income over the relevant period. The company recognises revenue from service concession arrangements and adjusts amounts receivable for any significant financing component. The difference between the contractual price receivable and the revenue recognised in accordance with IFRS 15 is recognised as Finance income.

(b) Rental income from investment property

Rental income from investment property is recognised in statement of comprehensive income on a straight-line basis over the term of the lease.

(c) Revenue from Service concession arrangements

Revenue related to construction or upgrade services under a service concession arrangement is recognised over time, consistent with the Company's accounting policy on recognising revenue on construction contracts. The company considers that the satisfaction of the performance obligation is concluded once units are made available to the Housing Authority for renting to tenants. Thereafter operation or service revenue is recognised in the period in which the services are provided by the Company. If the service concession arrangement contains more than one performance obligation, then the consideration received is allocated with reference to the relative stand-alone selling prices of the services delivered.

1.10 Borrowing costs

General and specific borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. All other borrowing costs are expensed. Borrowing costs are recognised for all interest-bearing instruments on an accrual basis using the effective interest method. Borrowing costs include the effect of amortising any difference between initial net proceeds and redemption value in respect of interest-bearing borrowings.

1.11 Dividend distributions

Dividend distributions to the Company's shareholders are recognised as a liability in the Company's financial statements in the period in which the dividends are approved by the Company's Directors.

15

2. Critical accounting estimates and judgements

Estimates and judgements are continually evaluated and based on historical experience and other factors including expectations of future events that are believed to be reasonable under the circumstances.

The Company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

(a) Valuation of investment properties

The Company's investment property comprises the MIA and VCP properties as well as the Parliament Building and Open-Air Theatre. The fair value of the Company's investment property has been determined based on projected future cash flows, appropriately discounted by a risk adjusted discount rate. As explained in Note 4 - Investment Property, the valuation was determined using discounted cash flow projections considering, inter alia, the projected future cash flows to be generated from the transfer of the dominium directum in respect of the MA and VCP properties, the Parliament Building and Open-Air Theatre, ongoing maintenance needs, and other relevant market factors.

A key variable used in the determination of the fair value of the Investment Property is the discount rate. The discount rate used for fair valuing the Investment Property is primarily based on the yield to maturity on the longest-term available Malta Government Stock (MGS), which plus a risk and conditional premium. When interest rates decrease, the fair value of the investment properties will increase. On the contrary, when interest rates increase, the fair value of the investment properties will decrease. Movements resulting from the said revaluation process are treated as non-distributable fair value gains (see Note 9). Other variables also come into play, including inflation rates (applied using a rolling five-year average), and conditional and risk premia which have been revised in the current year to reflect better current market conditions (Note 4).

The Audit Committee and the Board have been holding continuous discussions around the estimates and judgements applied to the fair value mechanism and related inputs. The Board continues to be confident that the mechanism is the most appropriate method to derive fair valuation of the respective investment properties in the statement of financial position. As explained in note 4, the Board had elected to include a conditional premium to counter the current volatility in interest rates that is having a significant impact on the fair value movements.

(b) Service concession arrangements

The analysis on whether the IFRIC 12, Service Concession Arrangements, applies to certain contracts and activities involves various complex factors and it is significantly affected by legal interpretation of certain contractual agreements or other terms and conditions with public sector entities.

The application of IFRIC 12 requires extensive judgment in relation with, amongst other factors, (i) the identification of certain infrastructures (and not contractual agreements) in the scope of IFRIC 12, (ii) the understanding of the nature of the payments in order to determine the classification of the infrastructure as a financial asset or as an intangible asset and (iii) the recognition of the revenue from construction and concessionary activity.

2. Critical accounting estimates and judgements - continued

(b) Service concession arrangements - continued

Other variables used in the accounting for IFRIC 12 include estimated project management fees during the construction phase and discount rates applied by reference to the average cost of capital for the entity to ensure that the project remains profitable and viable in the long term.

Note 8 gives detail in relation to the related financing available to date and also explains the work that management is currently undertaking to obtain the remaining financing to be able to conclude the project. Should this liquidity not be available in 2024, the Company may face liquidity strains, including potential impairment of the asset.

Changes in one or more of the factors described above may significantly affect the conclusions as to the appropriateness of the application of IFRIC 12 and, therefore, the results of operations or our financial position (Note 6). Note 6 gives detail in relation to contract asset and service concession arrangements, and the related financing available to date.

3. Segment reporting

The Directors have reviewed the disclosure requirements of IFRS 8, 'Operating Segments' and determined that the Company effectively has one operating segment, taking cognisance of the information utilised within the Company for the purpose of assessing performance.

4. Investment property

	30 June 2024	31 December 2023
	ਦ	ਵ
MIA and VCP properties Parliament Building and Open-Air Theatre	74.788.000 137,628,922	81,612,000 139.496.820
Carrying amount	212,416,922	221,108,820

MIA and VCP i -

	30 June 2024	31 December 2023
	ਵ	€
At 1 January Fair value movement	81,612,000 (6,824,000)	70,712,000 10,900,000
Carrying amount	74.788.000	81,612,000

4. Investment property - continued

ii. Parliament Building and Open-Air Theatre

	30 June 2024	31 December 2023
	e	ਵ
At 1 January Fair value movement	139,496,820 (1,867,898)	132,286,186 7,210,634
Carrying amount	137,628,922	139,496,820

Fair values of investment property

The movement in the fair value of investment property comprises the movement in the fair value of the dominium directum of the MIA and VCP properties, as well as the Parliament Building and Open-Air Theatre.

The fair value of investment property is calculated with reference to the cash flows receivable by the Company in terms of its contractual agreements, discounted to present value as at 30 June 2024.

Accordingly, the fair value of the investment property is subject to variation owing to her things, movements in market interest rates, expected inflation rates and changes in the contractual cash flows owing to the passage of time.

The Company is required to disclose fair value measurements of the following fair value measurement hierarchy for non-financial assets carried at fair value by level:

• Quoted prices (unadjusted) in active markets for identical assets (level 1).
• Inputs other than quoted prices included within level 1 that are observable for the asset either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2).
• Inputs for the asset that are not based on observable market data for similar properties (that is, . unobservable inputs) (level 3).

The Company's recurring fair value measurements are categorised as level 3 as they are based on significant unobservable inputs.

Valuation process

MIA and VCP a)

The valuation of the MIA and VCP properties is based on the present value of ground rents up to the expiry of the temporary emphyteutical grants and the estimated freehold value thereafter discounted to present value. The fair value of investment property is calculated with reference to the cash flows receivable by the Company in terms of its contractual agreements, discounted to present value as at 30 June 2024. The discount rate is based on the yield to maturity on the longest-term available MGS (Malta Government Stock) in issue as at year end plus a premium reflecting the risk inherent in the underlying cash flows.

For the period ended 30 June 2024 the MGS benchmark referred to above decreased and as a result, a fair value loss of €6,824,000 (June 2023 fair value gain: €3,476,000) has been recognised in these financial statements.

4. Investment property - continued

MIA and VCP - continued

In accordance with the fair value measurement hierarchy explained above, the significant unobservable inputs applied in the valuation of the Company's assets are the following:

• Ground rent, as contractually agreed which for the coming year is estimated at €2.21 million (June 2023: €2.1 million);
• Growth rate, as contractually agreed at an average of 2.53% p.a. (June 2023: 2.53% p.a.) represents the estimated average growth of the Company's rentals;
• Discount rate of 5.68% (June 2023: 5.60%) based on:
  • o the risk-free rate of return being the YTM on the longest-term available MGS at period end 4.18% (June 2023: 4.10%);
  • o risk premium taking into account factors such as, property illiquidity, management limitations, type, size and location of property, competition, country risk, counter-party risks and resource risks 1.0% (June 2023: 1.0%). This risk premium was adjusted by the Company in December 2022 following a review of the discount rate used for the valuation of the investment property. This adjustment results from the review of the various elements of commercial and market risk inherent to the investment properties; and
  • o conditional premium of 0.50% (June 2023: 0.50%). Due to the abnormally low level of interest rates that were prevalent in the past this conditional premium had been introduced. This premium is set at 0.75% when the YTM on the longest-term available MGS is lower than 2.0% and at 0.50% when it is 2.0% or higher.

If the discount rate used in the discounted future cash flows for the MIA and VCP properties had been 0.50% higher/lower, all other things being equal, the fair value of the MA and VCP properties would decrease by €8,5 million (June 2023: €8,6 million) or increase by €10.1 million (June 2023: €10,2 million) respectively.

b) Parliament Building and Open-Air Theatre

The valuation of the Parliament Building and Open-Air Theatre is based on the present value of ground rents up to the expiry of the temporary emphyteutical grant discounted to present value. The fair value of investment property is calculated with reference to the cash flows receivable by the Company in terms of its contractual agreements over the period to 2077, discounted to present value as at 30 June 2024. The discount rate is based on the yield to maturity on the longest-term available Malta Government Stock (MGS) in issue at year end plus a premium reflecting the risk inherent in the underlying cash flows. On 1 January 2019 the Company adopted IFRS 16 Leases and recognised a Right-of-use asset (see Note 5). The fair value of this asset is being included with the Investment property.

Hence, the carrying amount of €137,628,922 for the Parliament Building and Open-Air Theatre includes the fair value of the Right-of-use asset for such properties.

For the period ended 30 June 2024 the MGS benchmark referred to above decreased and a fair value loss of €1,867,898 (June 2023 fair value gain: €3,821,691) has been recognised in these Financial Statements. This fair value loss includes the fair value movement for the Right-of-use asset.

4. Investment property - continued

b) Parliament Building and Open-Air Theatre - continued

In accordance with the fair value measurement hierarchy explained above the significant unobservable inputs applied in the valuation of the Company's assets are the following:

• Rents, as contractually agreed which for the coming year is estimated at €6.79 million (2023: €6.78 million):
• Growth rate, at an average of 2.37% (June 2023: 2.24%), represents the estimated average growth of the Company's rentals. The growth rate is impacted by changes to inflation, calculated by the Company using a five-year rolling average;
• Discount rate of 6.68% (June 2023: 6.60%) based on:
  • o the risk-free rate of return being the YTM on the longest-term available MGS at year end 4.18% (June 2023: 4.10%);
  • o risk premium taking into account factors such as, property illiquidity, management limitations, type, size and location of property, competition, country risk, counter-party risks and resource risks of 2% (June 2023: 2.0%). This risk premium has been adjusted by the Company during the prior year following a review of the discount rate used for the valuation of the investment property. This adjustment results from the review of the various elements of commercial and market risk inherent to the investment properties; and
  • o conditional premium of 0.50% (June 2023: 0.50%). When the YTM on the longest-term available MGS is 2.0% or higher this conditional premium is set at 0.50%. When the YTM on the longest-term available MGS is lower than 2.00% this conditional premium is set at 0.75%.

If the discount rate used in the discounted future cash flows for the Parliament Building and Open-Air Theatre properties had been 0.50% higher/lower, all other things being equal, the fair value of the Parliament Building and Open Air Theatre properties would decrease by €12.9 million (June 2023: €10.3 million) or increase by €9 million (June 2023: €11.9 million) respectively.

5. Right-of-use asset, lease liability and provision on restoration

The lease liability relates to the Open-Air Theatre and Parliament Building in City Gate, Valletta included within the investment property in the statement of financial position.

a) Measurement of lease liabilities

	30 June 2024	31 December 2023
	ਵ	ਵ
Lease liability recognised as at 1 January	3,479,383	3,390,904
Interest on lease liability for the period	72,428	144.452
Ground rents payable for the period	(57.881)	(55,973)
Lease liability carrying amount	3,493,930	3.479.383

5. Right-of-use asset, Lease liability and Provision on restoration - continued

a) Measurement of lease liabilities - continued

	30 June 2024	31 December
	€	2023 ਵ
Of which are: Current lease liabilities	121,551	121,551
Non-current lease liabilities	3,372,379	3,357,832
Carrying amount	3,493,930	3,479,383
	30 June 2024	31 December 2023
	€	€
Maturity analysis - contractual undiscounted cash flows
Less than one year	121,551	121,551
One to five years	632,215	498,356
More than five years	9,304,668	9,499,326
Total undiscounted lease liabilities	10,058,434	10,119,233
	30 June 2024	30 June 2023
	€	ਵ
Amounts recognised in profit or loss from 1 January
Interest on lease liabilities	72,428	71,481
Interest on provision on restoration	122,812	117,095
	195,240	188,576

b) Measurement of right-of-use assets

The recognised right-of-use assets relate to investment properties and are being measured at fair value in line with the underlying investment properties.

	30 June 2024 ਵ	31 December 2023 ਵ
Balance as at 1 January Fair value gain / (loss)	6,027,937 (221,898)	5.428.303 599,634
Carrying amount	5,806,039	6.027.937

6. Contract asset and service concession arrangements

On 29 December 2017, the Company entered into a contractual arrangement with the Housing Authority to make available sixteen residential blocks, totalling around six hundred and eighty-four units that will be used for affordable housing purposes. During the construction phase, plans have been amended and a decision was taken to abandon the plan to develop one of the sites and further units were in turn added to another site. The updated number of units has hence to seven hundred fifty-two and this revised design and number of units has been formally captured in a new agreement with the Housing Authority. Excavation of the sites is substantially complete.

In line with the agreed terms, the Company has entitlement to cash flows from rental of the respective units. Rates are contractually agreed and will be paid by the tenant, with the remaining portion being received through a subsidy given by the Housing Authority.

The IFRIC 12 model prepared by management continues to be updated with the latest actual and projected costs and expected revenues to provide management and the Board with updated profitability projections, compared with original estimates. The model is discounted applying rates by reference to the average overall cost of capital for the Company, including consideration for rates used in the market for construction projects of a similar magnitude, and also considering the likelihood of increased interest rates due to the current global climate. The Board has successfully negotiated an increase in the revenue streams to ensure that the project remains profitable returns are generated despite the increase in the capital cost of the project.

The current model incorporates the latest estimates supplied by specialised architectural firms and also applies further precautionary overlays ranging from 5% to 15% for contracted and not finalised and non-contracted phases and assumes negotiations are successful. The resulting project Internal Rate of Return (IRR) is deemed acceptable by the Board of Directors.

Applying a further sensitivity on the costs of 5% for the unfinished phases and 10% on the uncontracted phases would result in an increase in costs amounting to €2.7 million. The resulting stress testing would still return a positive project IRR.

Upon termination of the emphyteutical grant, the Company is required to hand-over ownership, management and operation of all assets relating to all the revised 15 construction sites to the Housing Authority. During the term of the agreement, the Company is entitled to cash-flows relating to residential units even if these are vacant, with the only condition that entitles Malita Investments plc to cash-flows, being making such units available for use to the Housing Authority, The Company may not however dispose, or change the use of, the properties during the period of the concession.

Pursuant to IFRIC 12, when the operator has an unconditional right to receive cash or other financial assets from the grantor in remuneration for concession services, the financial asset model applies.

In this context, the infrastructure managed under these contracts cannot be recorded in assets of the operator as property, plant and equipment, but is recorded as a financial asset. During the construction phase, the financial as a contract asset. During the construction phase revenue is recognised in the Statement of Comprehensive Income. The stage of completion of works was determined as the percentage of cost incurred up until the end of the reporting period relative to the total estimated cost (cost-to-cost method).

6. Contract asset and service concession arrangements - continued

Income amounting to €10,732,935 (June 2023: €5,821,719) from the construction activity was recognised during the period ended 30 June 2024 and €77,982,400 (June 2023: €56,213,859) is cumulatively recognised in the Statement of Financial Position as a contract asset. Cash inflows from tenants and Housing Authority are being collected on a monthly basis. As at the end of June 2024, rents earned amount to €1,127,837, out of which revenue recognised in the Statement of Comprehensive Income for the period ended 30 June 2024 is €112,784 representing the portion of rents earned. The IFRIC 12 Model requires the remaining portion of rental streams to be accounted for as a recovery of contract asset development costs.

Costs in relation to construction amounting to €10,422,462 (June 2023: €5,654,289) were recognised in the Statement of Comprehensive Income for the period ended 30 June 2024. The difference between revenue and cost from the construction project during the period represents, in substance, project management fees as required by IFRIC 12.

Financial receivables are initially recognised at fair value and subsequently recognised at amortised cost using the effective interest method. The implied interest rate on the financial receivable is based on the derived rate implicit in the discounted cash flow model encompassing related terms and conditions within the Housing contract.

All the sites are scheduled to be completed by 2024, except for two sites. One of these sites will be completed by 2025, and the largest site is expected to be completed by 2026. Contracts for the works on almost all the sites have been entered, allowing the cost for completion to be reliably estimated.

The Company has secured financing for the project based on initial estimates. Variations to the initial plans for various sites and the additional number of units being constructed compared to the original plans have necessitated an increased estimated spend, which has been approved by the Project Board. The current liquidity arrangements cover agreements contracted to date on the respective sites.

During the years 2023 and 2024, the Board and management actively addressed the financing gap. The Company entered into a credit agreement with the European Investment Bank (EIB), in terms of which ElB has undertaken to provide the Company with funding amounting to €22 million, along with a further €29.9 million raised through a rights issue. Discussions with financial institutions for the remaining €11 million are at an advanced level, and management has correspondence in hand indicating that funds have been conceptually approved. This provides assurance for the completion of the construction and finishing phases across all mentioned sites.

Revenue from service concession arrangements is split as follows:

	30 June 2024 ਵ	31 December 2023 ਵ
Service concession arrangements Construction and finishing of blocks Provision of housing facilities	10,732,935 112,784	14,675,105 104.519
	10,845,719	14,779,624

6. Contract asset and Service concession arrangements - continued

Unsatisfied long-term contracts

The following table shows unsatisfied performance obligations resulting from the Company's service concession arrangements.

	30 June 2024	31 December 2023
	ਵ	を
Aggregate amount of the transaction price allocated to:
Construction and finishing of blocks Provision of housing facilities	46,894,222 29,688,254	57.482.306 30,298,828

Management expects that the revenue with respect to the unsatisfied performance obligations noted above will be recognised in the following accounting periods:

	Within 1 year	From 1 year to 5 years	Later than 5 years
Performance obligation
Construction and finishing of blocks	30,400,156	16,494,066
Provision of housing facilities	484,488	3,079,822	26,123,944

Liquidity streams covering the performance obligations will be spread over the course of the twentyfive-year concession agreements reflecting payments from tenants and the Housing Authority for the use of residential units. The provision of housing facilities is subject to inflationary movements.

Financial assets at fair value through profit or loss 7.

The Company classifies the following financial assets at FVTPL:

• · Debt investments that do not qualify for measurement at either amortised cost or FVOCI. As at 30 June 2024, these include investments in funds and mutual funds whose instruments fail to meet the definition of equity from the issuer's perspective.
• · Equity investments for which the Company has not elected to recognise fair value gains and losses through OCI.

	30 June 2024	31 December 2023
	ਣ	を
Curmi and Partners Investment Portfolio - Level 1 Financial assets at fair value through profit or loss	19,616,476

During the year, the Company recognised a net fair value gain of €116,583 (2023: NIL) in profit or loss on financial assets at fair value through profit or loss.

Level 1: The fair value of financial instruments traded in active markets (e.g. publicly traded derivatives and equity securities) is based on quoted market prices at the end of the reporting period. The quoted market price used for financial assets held by the group is the current bid price. These instruments are included in level 1.

8. Share capital

	30 June 2024	31 December 2023
	€	を
Authorised
200,000,000 Ordinary A shares of €0.50 each 50,000,000 Ordinary B shares of €0.50 each		100,000,000 25,000,000
250,000,000 Ordinary shares of €0.50 each	125,000,000
	125,000,000	125,000,000
Issued and fully paid
208,206,593 Ordinary shares of €0.50 each	104,103,297	74,054,032
Issue costs	(1,363,683)	(758,889)
	102,739,614	73,295,143

9. Retained earnings

The retained earnings include non-distributable earnings as a result of the Revenue from service concession arrangements recognised on the Affordable Housing project as per IFRS 15. These earnings will become distributable once the Company starts earning lease income.

	30 June 2024	31 December 2023
	€	ਵ
Distributable	8,915,512	9,966,638
Non-distributable	7,674,416	6,396,740
	16,589,928	16,363,378

10. Non-distributable reserve - fair value movements

The reserve represents the cumulative fair value gains, net of applicable deferred tax liabilities on the Company's investment properties. These fair value movements are initially recognised in the statement of comprehensive income and because of their nature, were subsequently transferred to a non-distributable reserve.

11. Non-distributable reserve - other

As per article 82 of the Company's Articles of Association, the Directors have set aside €312,042 (June 2023: €263,892) which equals 10% of the net loss for the period excluding fair value movements net of deferred tax of the Company and allocated them to a non-distributable reserve (see Note 9). The Directors may employ the reserve in the furtherance of the business of the Company as the Directors may from time-to-time think fit.

12. Borrowings

The Company's loan facilities as at 30 June 2024 amounted to €86,776,461 (December 2023: €89,587,478), and these were fully utilised.

	ਵ	30 June 2024 31 December 2023 ಲ್ಲು
Borrowings Non-current Current	82,583,377 4,193,084	85,885,646 3,701,832
	86,776,461	89,587,478

13. Capital creditor for the acquisition of property

The non-current balance amounting to €825,867 represents amounts owed to contractors for works carried out in relation to the Affordable Housing project that are repayable after more than one year as per signed contractual agreements. Hence, it is classified as a non-current liability.

The outstanding balance of €6,980,200 is related to the Affordable Housing project and is due within the coming year. Hence, it is classified as a current liability.

	30 June 2024 31 December 2023 ਵ	ਵ
Capital creditors
Non-current	825,867	1.086.455
Current	6,980,200	6,227,116
	7,806,067	7,313,571

14. Provision for liabilities and charges

As part of its ongoing commitment to the project, the Company recognises a provision of €187,681 for maintenance costs to account for future expenses associated with the upkeep and preservation of the constructed properties. The provision is established based on management's best estimate of the expected maintenance costs over the economic life of the provision is reviewed and increased regularly to reflect any changes in the assessment of future expenses. The provision is included in administrative expenses in the condensed statement of comprehensive income.

15. Revenue

Revenue comprises the consideration payable by MIA and VCP by way of an annual ground rent in respect of the temporary emphyteusis granted.

Lease for the Open-Air Theatre is receivable by the Company pursuant to a lease agreement. Also included in the revenue figure is a lease payable by Government of Malta for the Parliament Building whose certificate of completion was issued in January 2019. Lease payments for the Parliament Building started in the 2019 as prior to the certificate of completion being issued the Company received a daily penalty broadly in line with the rental income due, had the project been completed on time.

On 20 April 2017, a lease agreement was entered into between the Government of Malta and the Company to reflect an additional in the Parliament Building and as from 1 June 2017 additional rent is payable semi-annually to the Company.

16. Expenses by nature

	Period from 1 January to 30 June 2024 ਵ	Period from 1 January to 30 June 2023 ਵ
Directors' emoluments (Note 18) Professional fees Printing & advertising Employee benefit expenses (Note 17) Depreciation of property, plant and equipment Lease of premises Provision for housing maintenance costs Other expenses	52,255 102,478 5,956 155,750 9,455 10,000 187,681 79,895	46.140 126,261 3,112 147,881 10.333 10,000 150.795 49,102
	603,470	543,624

17. Employee benefit expenses

	Year ended	Year ended
		1 January to 1 January to 30
	30 June	June
	2024	2023
	ਵ	ਵ
Wages and salaries	148,301	141.004
Social security costs	7,449	6,877
	155,750	147,881

The average number of persons employed during the year by the Company amounted to 6 (June 2023: 5).

18. Directors' emoluments

	Period from 1 January to 30 June 2024 (3	Period from 1 January to 30 June 2023 €
Paul Mercieca (not re-elected 28 April 2023) Eric Schembri (resigned 28 February 2023) David Mallia (resigned 30 May 2024) Marlene Mizzi (resigned 30 May 2024) Johan Farrugia (appointed 30 May 2024) Robert Suban (Director) Victor Carachi (Director) Tania Brown (Director) Miguel Borg (Director) Desiree Cassar (Director)	5,190 10.399 2,291 8.750 6,458 6,042 8,125 5,000	4,892 1.667 1,875 12,500 7.708 4 792 4,792 5,625 2,292
	52,255	46.143

19. Finance income

	Period from 1 January to 30 June 2024 ਵ	Period from 1 January to 30 June 2023 gj
Bank Interest Income		52,827
Finance income - Affordable Housing	1,980,821	1,295,482
Other Income	3.424
Realised Gain on Investments	10.808
Unrealised Gain on Investments	105,775
	2,100,828	1.348.309

20. Tax expense

The tax expense for the period is made up as follows:

	Period from 1 January to 30 June 2024 ਵ	Period from 1 January to 30 June 2023 ਵ
Current tax expense Deferred tax (credit) / expense (note 21)	1,034,149 (677,649)	949.266 537,750
Tax expense	356,500	1.487.016

20. Tax expense - continued

The tax on the Company's loss before tax differs from the theoretical amount that would arise using the basic tax rate as follows:

	Period from 1 January to 30 June 2024 (S	Period from 1 January to 30 June 2023 ಕ
(Loss) / Profit before tax	(3,261,090)	11,931,452
Tax (credit) / expense on (loss) / profit at 35%	(1,141,382)	4,176,008
Tax effect of: Income subject to 15% final withholding tax Income subject to 10% final withholding tax Income not chargeable for tax purposes Expenses not deductible for tax purposes Tax rules applicable to investment property Maintenance allowance Over provision in current period	(221,875) (281,959) (800,784) 749,406 2,286,850 (233,756)	(225,765) (139,113) (729,741) 435,519 (1,814,950) (233,432) 18,490
Tax (credit) / expense in the accounts	356,500	1,487,016

Deferred tax 21.

Deferred tax is provided for using the liability method for temporary differences arising on movements in the fair value of immovable investment property of MIA and VCP and the Parliament Building and Open-Air Theatre. The calculation of the deferred tax provision for the period ended 30 June 2024 is calculated on the taxation rules on capital gains upon a transfer of immovable property implemented through Act XIII of 2015, with effect from 1 January 2015, the rate of capital gains tax applicable is a final withholding tax of 8% on the value of the property.

The deferred tax balance as at 30 June 2024 represents:

	30 June 2024 ਵ	31 December 2023 ਵ
Temporary differences on: Fair value movements	16,528,843	17,206,534

The movement for the period comprising the recognition of the above deferred tax liability has been debited to the statement of comprehensive income.

22. Earnings per share

Earnings per share is calculated by dividing the profit attributable to owners of the Company by the total number of ordinary shares in issue during the period.

		Period from 1 January to 30 June 2024	Period from 1 January to 30 June 2023
	(Loss) / Profit for the period (€) Total average number of ordinary shares in issue	(3,617,590) 208,206,593	10,444,436 148,108,064
	(Loss) / earnings per share in cents	(1.74)	7.05
23.	Dividends	2023	2022
		Final dividend ਵ	Final dividend ਵ
	Dividends paid on ordinary shares
	Gross Tax at source	4,538,903 (680,036)	3,228,756 (1,130,065)
		3,858,067	2,098,691
	Dividends per share in cents	1.85	1.42

On 28 August 2024, the Board of Directors declare an interim gross dividend in respect of the period ended 30 June 2024 of €2,748,327 or €0.0132 per share equating to an interim net dividend of €1,786,413 or €0.0086 per share. The Financial Statements do not reflect this dividend.

24. Cash generated from operations

Reconciliation of operating profit to cash generated from operations:

Period from	Period from
1 January to	1 January to
30 June	30 June
2024	2023
モ	ਵ
4,319,768	4,138,797
(423,257)	(213,801)
9,455	10,331
187,681	150,795
(360,370)	(4,911,249)
86,246	4,092,295
3,819,523	3,267,168

25. Related party transactions

The only major shareholder of the Gompany is the Government of Malta through its 81.94% (2023: 79.75%) shareholding. The remaining 18.06% (2023: 20.25%) of the shares are held by the public.

Other related entities are the following, since they are all Government owned and managed:

• Malta Investment Management Company Limited r
• Projects Plus Limited
• Housing Authority
• Social Projects Management Limited

All because they are Government owned and managed.

The following transactions have been carried out with the above related parties during the period.

	Period from 1 January to 30 June 2024 ਵ	Period from 1 January to 30 June 2023 ਵ
Government of Malta
Parliament lease income from Government Open Air Theatre lease income from Government Parliament Building additional rent from Government	2,079,490 893,948 423,812	2,079,490 922,282 390,854
Projects Plus Limited Professional service fees to Projects Plus Limited	(277,731)	(277,731)
Housing Authority Ground rent to Housing Authority Affordable Housing rent	(73,353) 986,856	(73,292) 463,710
Social Projects Management Limited Project management services costs to SPM Limited		(17,053)

26. Statutory information

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Malita Investments p.l.c. is a public limited liability Company and is incorporated in, with its registered address at Clock Tower, Level 1, Tigne Point, Sliema, Malta. The ultimate controlling party of Malita Investment p.l.c. is the Government of Malta.