Luxor B — Interim / Quarterly Report 2015

Mar 8, 2016

Investeringsselskabet Luxor A/S

Frederiksborggade 50, 1360 København K · Telefon 33 32 50 15 · Telefax 33 12 41 70 · CVR-nr. 49 63 99 10

Nasdaq Copenhagen A/S
Nikolaj Plads 6
PO Box 1040
DK-1007 Copenhagen K

Announcement No 5
page 1 of 19
date 29 February 2016
ref. IK/ls

Interim Report

as at 31 December 2015

The Supervisory Board of Investeringsselskabet Luxor A/S has today adopted the Interim Report as at 31 December 2015.

First quarter of the financial year:

• Basic earnings amount to DKK 8.8 million (DKK 4.5 million), which is DKK 3.7 million higher than expected. The improvement is primarily attributable to an increase in net financial income of DKK 1.8 million and an improvement of net loss/gain on mortgage deeds of DKK 1.5 million.
• The Group’s results before tax for the period show a loss of DKK 9.5 million (DKK -13.3 million). After tax, the Group shows a loss of DKK -7.4 million (DKK -10.4 million).

The results are negatively affected by DKK 18.3 million, of which DKK -16.4 million relates to net negative fair value adjustments and realised losses on bonds as a result of volatility in the bond market and a widening of the yield spread to government bonds, among other things as a consequence of exposure to the energy and commodity sectors as well as currency hedging, and DKK -1.9 million relates to other fair value adjustments etc not included in basic earnings.

• The net asset value per share in circulation is DKK 346.89 (DKK 402.38). The net asset value per share in circulation is significantly affected by the dividend distribution of DKK 50 million in January 2015, corresponding to DKK 50 per share.

Expected profit for the year 2015/16

• At present, basic earnings of approx. DKK 24.0 million are expected for the financial year 2015/16 compared to approx. DKK 20.0 million previously expected.

Fair value adjustments and losses and gains realised on bonds, foreign currencies and interest swaps, etc are not included in basic earnings and will from the beginning of the financial year until 18 February 2016 affect results for the year before tax by approx. DKK -29.8 million, of which approx. DKK -18.3 million relates to the period until 31 December 2015 and approx. DKK -11.5 million to the period 1 January to 18 February 2016.

For additional information concerning this Interim Report, please contact Jannik Rolf Larsen, Manager.

Yours faithfully
Investeringsselskabet Luxor A/S

Svend Rolf Larsen
CEO

Jannik Rolf Larsen
Manager

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 2 of 19

Announcement No 5 of 29 February 2016
Interim Report for the period 1 October to 31 December 2015

Contents

	Page
Financial Highlights of the Group	3
Interim Report	4 - 9
Management’s Statement	10
Consolidated Statement of Comprehensive Income	11
Consolidated Balance Sheet	12 - 13
Statement of Changes in Equity	14
Cash Flow Statement	15
Segment Reporting	16
Significant Notes.	17 - 19

Investeringsselskabet Luxor A/S is an investment company investing shareholders’ equity and debt capital in capital investments. The Company’s main activities are distributed on mortgage deeds, bonds and properties. The Company has adopted a flexible investment strategy within a number of specific investment frameworks.

The overall objective of the Group is to achieve the best possible long-term return on investments for the shareholders by investing shareholders’ equity and debt capital in capital investments within the risk frameworks established.

Pursuant to the Danish Act on Alternative Investment Fund Managers, Investeringsselskabet Luxor A/S is permitted to invest in mortgage deeds, bonds and properties and has been granted an exemption in respect of being permitted to manage shares received in connection with a corporate bond in the portfolio being wholly or partly converted into shares.

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 3 of 19

FINANCIAL HIGHLIGHTS OF THE GROUP

	OCTOBER - DECEMBER
DKK million	2015/16
Q1	2014/15
Q1	2013/14
Q1	2014/15
Full year
Key figures
Income	4.2	17.1	14.1	59.9
Gross earnings	3.7	-0.8	7.7	43.1
Profit/loss before tax	-9.5	-13.3	4.7	-10.2
Net profit/loss for the period	-7.4	-10.4	3.5	-8.5
Basic earnings	8.8	4.5	2.7	24.1
Assets	917.2	893.9	794.9	915.5
Equity	346.9	402.4	411.2	354.3
Investment in property, plant and equipment	0.1	0.0	0.0	0.7
Profit/loss for analytical purposes:
Net profit/loss for the period (after tax)	-7.4	-10.4	3.5	-8.5
Ratios
Values per DKK 100 share
Earnings per share (EPS) (DKK)	-7.40	-10.40	3.52	-8.48
Net asset value per share in circulation (DKK)	346.89	402.38	411.15	354.29
Return on equity in percentage p.a.	-8.45	-10.20	3.44	-2.21
Equity share in percentage	37.82	45.01	51.72	38.70
Share capital
Nominal share capital, end of period (DKK million)	100.0	100.0	100.0	100.0
Number of shares in circulation (DKK million)	100.0	100.0	100.0	100.0
Official price on the Stock Exchange per DKK 100 share:
Lowest	310	261	216	261
Highest	355	305	233	362
End of period	350	305	233	317
Volume of trade on the Stock Exchange, number of shares	5,718	7,685	6,062	32,385
Listed on the Stock Exchange, number of shares	825,000	825,000	825,000	825,000

The key figures have been calculated in accordance with "Recommendations and key figures 2015" issued by the Danish Society of Financial Analysts. EPS and diluted EPS are in accordance with IAS 33.

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Investeringsselskabet Luxor A/S INTERIM REPORT page 4 of 19

INTERIM REPORT

Basic earnings and results

The Group’s basic earnings amount to DKK 8.8 million (DKK 4.5 million).

Basic earnings are calculated as profit/loss before tax for the period adjusted for fair value adjustments of securities, debt and foreign exchange movements and realised losses on securities. Basic earnings are DKK 3.7 million higher than expected, which is primarily attributable to an increase in the Group’s net financial income of DKK 1.8 million and an improvement of net loss/gain on mortgage deeds of DKK 1.5 million.

At present, basic earnings of approx. DKK 24.0 million are expected for the financial year 2015/16 compared to approx. DKK 20.0 million previously expected.

The Group’s results before tax amount to DKK -9.5 million (DKK -13.3 million). After recognition of tax for the period of DKK -2.1 million (DKK -2.9 million), the results for the period after tax amount to DKK -7.4 million (DKK -10.4 million). The results for the period are affected by net negative fair value adjustments and realised losses on bonds as well as currency hedging of DKK 16.4 million.

Business areas

The Group’s balance sheet, which compared with the same time last year has increased from DKK 893.9 million to DKK 917.2 million, includes the following business areas:

| | 2015/16
DKK million | 2014/15
DKK million |
| --- | --- | --- |
| Mortgage deeds | 544.9 | 392.8 |
| Bonds | 125.3 | 243.4 |
| Shares | 1.9 | 0.0 |
| Total securities | 672.1 | 636.2 |
| Investment properties | 180.5 | 180.1 |
| Total | 852.6 | 816.3 |

Below, the individual business areas are described. The financing and the effect of currency hedging as well as currency exposure and hedging of currency risk are described in the section financing and debt.

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Investeringsselskabet Luxor A/S INTERIM REPORT page 5 of 19

Mortgage deeds

The fair value of the Group's portfolio of mortgage deeds amounts to DKK 544.9 million (DKK 392.8 million).

The total return on the portfolio of mortgage deeds for the period is specified as follows:

| | 2015/16
DKK million | 2014/15
DKK million |
| --- | --- | --- |
| Interest income | 10.8 | 6.8 |
| Capital gains, mortgage deeds | 1.3 | 0.5 |
| Fair value adjustment | -0.3 | 1.2 |
| Gross return | 11.8 | 8.5 |
| Realised and unrealised losses
on mortgage deeds, bad
debts recovered and gain
on sale of properties acquired
for the purpose of resale | -1.1 | -2.4 |
| | 10.7 | 6.1 |

Fixed-interest mortgage deeds of a nominal amount of DKK 398.6 million are measured at fair value in the balance sheet on the basis of an average effective interest rate of 8.50% p.a. (8.50% p.a.) irrespective of the term to maturity and the present market rate for new mortgage deeds at the level of 7.5% - 9.0% p.a. (7.5% - 9.5% p.a.). Fixed-interest mortgage deeds of a nominal amount of DKK 49.1 million and cibor mortgage deeds of a nominal amount of DKK 174.8 million are measured at fair value on the basis of the cost of the mortgage deeds.

The Group's portfolio of mortgage deeds has an average fair value per mortgage deed of kDKK 273.7 (kDKK 293.0).

Net loss/gain and direct expenses amount to DKK -1.3 million (DKK -2.5 million), which is approx. DKK 1.5 million lower than expected as the development towards more normalised losses and fair value adjustment of credit risk have progressed more positively than expected.

Net loss/gain and direct expenses include:

• realised net losses on mortgage deeds and mortgage deed receivables of DKK 0.8 million (DKK 6.0 million);
• an increase in adjustment to meet the credit risk on mortgage deeds and mortgage deed receivables of DKK 1.2 million (DKK -0.1 million);
• bad debts recovered of DKK 0.8 million (DKK 0.4 million);
• loss on sale of properties acquired for the purpose of resale of DKK 0.1 million (DKK 0.5 million) and reversed provisions for losses on properties acquired for the purpose of resale of DKK 0.2 million (DKK 2.6 million). Properties acquired for the purpose of resale have been purchased to secure loans granted by the Group.

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Investeringsselskabet Luxor A/S INTERIM REPORT page 6 of 19

The total fair value adjustment of credit risk on mortgage deeds amounts to DKK 16.0 million (DKK 14.8 million), corresponding to 2.8% (3.6%) of the portfolio.

For the current financial year, the Group expects a continued increase of the mortgage deed portfolio.

Bonds

The fair value of the Group’s portfolio of bonds amounts to DKK 125.3 million (DKK 243.4 million).

The total return on the portfolio of bonds for the period is specified as follows:

| | 2015/16
DKK million | | 2014/15
DKK million | |
| --- | --- | --- | --- | --- |
| Interest income | 3.1 | | 4.6 | |
| Realised capital gains on bonds
(including foreign exchange) | -14.2 | | 2.3 | |
| Fair value adjustment | 2.0 | | -14.9 | |
| Forward exchange contracts | -0.9 | | -0.9 | |
| Exchange loss/gain on foreign loans etc, net | -3.3 | -16.4 | -4.4 | -17.9 |
| Return after currency hedging | -13.3 | | -13.3 | |

The loss on bonds realised includes a realised exchange gain of DKK 2.5 million (DKK 2.6 million), and fair value adjustments include an unrealised exchange loss of DKK 1.9 million (DKK 1.3 million).

The portfolio of bonds, which is primarily in USD, has by and large been hedged with regard to currency fluctuations by means of currency swaps and loans in the same currency.

Fair value adjustments for the period with addition of reversed write-downs on the sale of bonds are negative as a result of volatility in the bond market and a widening of the yield spread to government bonds, among other things as a consequence of exposure to the energy and commodity sectors.

At 31 December 2015, the portfolio of bonds comprises a total negative fair value adjustment and possible gains on redemptions of up to approx. DKK 34.5 million excluding foreign exchange (approx. DKK 13.8 million excluding foreign exchange) provided that the portfolio of bonds is redeemed or sold at par. Gains on redemptions are expected to be reversed over the period to maturity of the bonds until 2022/23. The portfolio of bonds is characterised by an overweight of bonds with a relatively short to medium term to maturity and an average Macaulay duration of approx. 3.9 years (approx. 4.3 years).

Since the closing of the financial period and until 18 February 2016, the Group has seen negative fair value adjustments of bonds of DKK 14.7 million and a realised gain of DKK 5.5 million. The fair value adjustments and realised gain include an exchange loss of DKK 1.2 million.

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Investeringsselskabet Luxor A/S INTERIM REPORT page 7 of 19

Shares

The fair value of the Group’s portfolio of shares amounts to DKK 1.9 million (DKK 0.0 million). The shares were received in connection with a reconstruction of a bond issuer where the Group’s portfolio of bonds has been converted into shares.

To the extent that corporate bonds in the Parent Company’s portfolio are converted into shares, the Supervisory Board has granted authority to maintain the ownership of the listed or unlisted shares for a period until the shares can be sold at a value which, in the opinion of the Parent Company, reflects the actual value of the share.

Investment properties

The Group’s balance sheet includes 5 (5) investment properties with a fair value of DKK 180.5 million (DKK 180.1 million).

The total return on investment properties for the period is specified as follows:

	2015/16 DKK million	2014/15 DKK million
Rental income	3.5	3.7
Direct expenses, investment properties	1.0	1.6
	2.5	2.1

Properties acquired for the purpose of resale

Properties acquired for the purpose of resale, DKK 10.7 million (DKK 15.6 million), comprise 3 (5) properties taken over to secure loans granted by the Group. The properties are distributed with DKK 10.0 million on business-related properties and DKK 0.7 million on residential property.

During the first quarter of the financial year, the Group sold a small part of a business property.

Financing and debt

The fair value of the Group’s short-term debt to credit institutions amounts to DKK 458.2 million (DKK 396.3 million). After conversion by means of matching forward contracts, the debt is distributed as follows:

Currency	2015/16	2014/15
EUR	15.99%	9.48%
DKK	52.03%	30.19%
USD	30.23%	55.53%
NOK	1.75%	4.80%
	100.00%	100.00%

The Company has pegged the interest rate on DKK 150.0 million (DKK 25.0 million) through DKK interest swaps with a remaining term of up to 9 years. Fair value adjustment of interest swaps for the period is a negative DKK -0.9 million (DKK -0.1 million).

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Investeringsselskabet Luxor A/S INTERIM REPORT page 8 of 19

The net movement for the period deriving from exchange adjustments of foreign loans, forward contracts, securities, etc is a negative DKK 3.6 million (DKK -1.2 million) as a result of a volatile USD rate and negative fair value adjustments. Financing in foreign currencies is primarily used with a view to hedging assets in foreign currencies.

Part of the Group's assets is placed in foreign currencies. The Group's total currency exposure in respect of assets and liabilities is distributed as follows in percentage:

Currency	31 December 2015		31 December 2014
	Assets	Liabilities	Assets	Liabilities
DKK	85.77%	76.00%	73.44%	69.00%
EUR	0.61%	8.01%	0.58%	4.21%
NOK	1.02%	0.88%	2.38%	2.13%
USD	12.60%	15.11%	23.60%	24.66%
	100.00%	100.00%	100.00%	100.00%

Fair value adjustments of mortgage credit institutes for the period, including interest swaps, are a negative DKK 0.2 million (DKK 1.0 million) as a consequence of changes in interest rates. The amount is counterbalanced through current fair value adjustments over the remaining term of the loans/contracts.

Risk relating to equity and market values upon change of parameter

The below table shows the sensitivity of a number of significant balance sheet items at 31 December 2015 and 31 December 2014.

DKK million	Increase in parameter	2015/16 Fair value	2015/16 Change of value	2014/15 Fair value	2014/15 Change of value
Mortgage deeds	1% effective rate of interest	544.9	20.3	392.8	12.9
Bonds	1% effective rate of interest	125.3	4.1	243.4	10.0
Shares	10% change in value	1.9	0.2	0.0	0.0
Investment properties	0.5% yield requirement	180.5	11.3	180.1	10.8
Foreign currency loans	Change in exchange rate *	447.8	15.8	255.5	22.2
Securities in foreign currencies	10% change in value	125.3	12.5	232.9	23.3

• Change in exchange rate 1% for loans in EUR and 10% for loans in NOK and USD.

It should be added that if the above parameters were to develop negatively due to an increase in interest rates, this would be counterbalanced by a certain reduction of the cash value of mortgage credit loans and interest swaps.

The Group's financial risks and financial instruments are described in note 36 to the Annual Report; see the Company's website www.luxor.dk.

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Investeringsselskabet Luxor A/S INTERIM REPORT page 9 of 19

Future prospects and post balance sheet events

At present, basic earnings of approx. DKK 24.0 million are expected for the financial year 2015/16 compared to basic earnings previously expected of approx. DKK 20.0 million.

Fair value adjustments and losses and gains realised on bonds, foreign currencies and interest swaps, etc are not included in basic earnings and will from the beginning of the financial year until 18 February 2016 affect results for the year before tax negatively by approx. DKK 29.8 million, of which approx. DKK -18.3 million relates to the period until 31 December 2015 and approx. DKK -11.5 million to the period 1 January to 18 February 2016.

The expectations for the future, including expectations relating to basic earnings, fair value adjustments and losses/gains on securities, are subject to risks and uncertainties and may be affected by factors such as global economic conditions, including the credit market and interest rate and foreign exchange developments. Thus, the actual development and actual results might differ significantly from the expectations in the Annual Report.

Basis of preparation

The Interim Report has been prepared in accordance with the same accounting policies as the Annual Report 2014/2015, to which we refer.

The Interim Report comprises summarised consolidated financial statements of Investerings-selskabet Luxor A/S.

The Interim Report has been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, including IAS 34 on Interim Reports, and additional Danish disclosure requirements relating to listed companies.

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Investeringsselskabet Luxor A/S INTERIM REPORT page 10 of 19

MANAGEMENT'S STATEMENT

The Supervisory and Executive Boards have today considered and adopted the Interim Report of Investeringsselskabet Luxor A/S for the period 1 October - 31 December 2015.

The Interim Report, which comprises summarised consolidated financial statements of Investeringsselskabet Luxor A/S, has been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the EU, including IAS 34 on Interim Reports, and additional Danish disclosure requirements relating to listed companies.

We consider the accounting policies applied appropriate, so that the Interim Report gives a true and fair view of the financial position as at 31 December 2015 of the Group and of the results of the Group's operations and cash flows for the period 1 October - 31 December 2015.

The Interim Report has not been audited by the Company's auditor.

Copenhagen, 29 February 2016

Executive Board:

Svend Rolf Larsen

Jannik Rolf Larsen

Supervisory Board:

Steffen Heegaard

Casper Moltke
Chairman

Michael Hedegaard Lyng

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 11 of 19

STATEMENT OF COMPREHENSIVE INCOME FOR THE PERIOD

1 OCTOBER - 31 DECEMBER 2015

	Note	GROUP
		1/10 - 31/12
2015
DKK '000	1/10 - 31/12
2014
DKK '000	1/10 2014-
30/9 2015
DKK '000
Income
Financial income	1	730	13,094	45,246
Rental income		3,508	3,659	14,295
Other income		0	325	360
Total income		4,238	17,078	59,901
Net loss/gain and direct expenses	2	-1,294	-2,529	-12,291
Direct expenses, properties		1,055	1,636	5,305
		1,889	12,913	42,305
Fair value adjustment of financial assets	3	1,800	-13,674	417
Fair value adjustment of investment
properties		0	0	400
Total gross earnings		3,689	-761	43,122
Financial expenses	5	9,005	9,187	39,416
		-5,316	-9,948	3,706
Other external expenses		1,411	805	3,266
Other income and expenses		0	0	-7
Staff expenses	4	2,675	2,476	10,381
Depreciation and amortisation		96	59	253
		4,182	3,340	13,893
Profit/loss before tax		-9,498	-13,288	-10,187
Tax on profit/loss for the period	6	-2,096	-2,891	-1,702
NET PROFIT/LOSS FOR THE PERIOD		-7,402	-10,397	-8,485
Earnings per A & B share (EPS) in DKK		-7.4	-10.4	-8.5
Earnings per A & B share (EPS) in DKK
(diluted value)		-7.4	-10.4	-8.5

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 12 of 19

BALANCE SHEET AS AT 31 DECEMBER 2015

ASSETS

	GROUP
	31/12 2015 DKK ‘000	31/12 2014 DKK ‘000	30/9 2015 DKK ‘000
Fixed assets
Domicile properties	11,317	11,504	11,364
Fixtures, fittings and equipment	927	282	922
Property, plant and equipment	12,244	11,786	12,286
Investment properties	180,500	180,100	180,500
Rebuilding in progress	351	0	0
	180,851	180,100	180,500
Securities	672,042	639,055	665,882
Fixed asset investments	672,042	639,055	665,882
Deferred tax	14,397	13,489	12,301
Non-current assets	879,534	844,430	870,969
Properties acquired for the purpose of resale	10,686	15,632	12,622
Other receivables	22,860	28,436	22,322
Corporation tax receivable	102	215	270
Forward contracts, currency swaps	82	289	0
Prepayments	291	445	506
Receivables	23,335	29,385	23,098
Cash at bank and in hand	3,658	4,446	8,852
Current assets	37,679	49,463	44,572
ASSETS	917,213	893,893	915,541

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 13 of 19

BALANCE SHEET AS AT 31 DECEMBER 2015

LIABILITIES AND EQUITY

	GROUP
	31/12 2015 DKK ‘000	31/12 2014 DKK ‘000	30/9 2015 DKK ‘000
Share capital	100,000	100,000	100,000
Proposed dividend	20,000	50,000	20,000
Retained earnings	226,890	252,380	234,292
Equity	346,890	402,380	354,292
Mortgage credit institutes	76,944	60,409	77,898
Forward contracts, interest swaps	9,008	7,801	8,121
Non-current liabilities	85,952	68,210	86,019
Mortgage credit institutes, properties held for sale	0	1,267	0
Mortgage credit institutes	4,577	3,916	4,595
Credit institutions	458,222	396,306	449,525
Deposits	2,978	2,985	3,026
Other payables	17,345	18,248	16,806
Forward contracts and currency swaps	253	224	736
Deferred income	996	357	542
Current liabilities	484,371	423,303	475,230
Liabilities	570,323	491,513	561,249
LIABILITIES AND EQUITY	917,213	893,893	915,541

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 14 of 19

STATEMENT OF CHANGES IN EQUITY

Group

| | Share capital
A shares
DKK '000 | Share capital
B shares
DKK '000 | Retained earnings
DKK '000 | Proposed dividend
DKK '000 | Total
DKK '000 |
| --- | --- | --- | --- | --- | --- |
| Equity A & B shares
at 1 October 2014 | 17,500 | 82,500 | 262,777 | 50,000 | 412,777 |
| Net profit/loss for the period
(comprehensive income) | 0 | 0 | -10,397 | 0 | -10,397 |
| Equity A & B shares
at 31 December 2014 | 17,500 | 82,500 | 252,380 | 50,000 | 402,380 |
| Equity A & B shares
at 1 October 2015 | 17,500 | 82,500 | 234,292 | 20,000 | 354,292 |
| Net profit/loss for the period
(comprehensive income) | 0 | 0 | -7,402 | 0 | -7,402 |
| Equity A & B shares
at 31 December 2015 | 17,500 | 82,500 | 226,890 | 20,000 | 346,890 |

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 15 of 19

CASH FLOW STATEMENT FOR THE PERIOD 1 OCTOBER - 31 DECEMBER 2015

	GROUP
	2015/16 DKK '000	2014/15 DKK '000
Cash flows from operating activities
Interest received on mortgage deeds and bonds	13,285	11,453
Other financial income	-205	-1,152
Other income	0	325
Rental income	4,161	3,721
Interest payments	-4,507	-3,723
Operating expenses and other payments	-5,365	-10,183
Properties acquired for the purpose of resale	1,979	8,108
Tax payments	168	-2
Cash flows from operating activities	9,516	8,547
Cash flows from investing activities
Additions of mortgage deeds and bonds	-51,367	-64,026
Disposals of mortgage deeds and bonds	33,508	48,050
Deposits received	13	5
Other capital investments	-405	0
Cash flows from investing activities	-18,251	-15,971
Cash flows from financing activities
Raising of loans, credit institutions	4,728	9,197
Repayment, mortgage credit institutes, properties acquired for the purpose of resale	0	-95
Raising of loans, mortgage credit institutes	0	5,311
Repayment, mortgage credit institutes	-1,127	-3,906
Deposits paid	-60	-31
Cash flows from financing activities	3,541	10,476
Net change in cash and cash equivalents	-5,194	3,052
Cash and cash equivalents, beginning of period	8,852	1,394
Cash and cash equivalents, end of period	3,658	4,446

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 16 of 19

SEGMENT REPORTING

Group

| | Mortgage deeds
DKK ‘000 | Bonds
DKK ‘000 | Shares
DKK ‘000 | Investment properties
DKK ‘000 | Other
DKK ‘000 | Total
DKK ‘000 |
| --- | --- | --- | --- | --- | --- | --- |
| Group 2015/16 | | | | | | |
| Income (realised) | 12,753 | -12,023 | 0 | 3,508 | 0 | 4,238 |
| Fair value adjustment | -252 | 1,988 | 64 | 0 | 0 | 1,800 |
| Gross earnings | 11,207 | -10,035 | 64 | 2,453 | 0 | 3,689 |
| Assets | 574,661 | 128,690 | 1,876 | 157,151 | 54,835 | 917,213 |
| Capital investments | 45,796 | 5,571 | 0 | 351 | 54 | 51,772 |
| Liabilities (segments) | 375,889 | 84,091 | 1,284 | 85,440 | 5,025 | 551,729 |
| Group 2014/15 | | | | | | |
| --- | --- | --- | --- | --- | --- | --- |
| Income (realised) | 7,059 | 5,933 | 102 | 3,659 | 325 | 17,078 |
| Fair value adjustment | 1,238 | -14,912 | 0 | 0 | 0 | -13,674 |
| Gross earnings | 5,768 | -8,979 | 102 | 2,023 | 325 | -761 |
| Assets | 433,022 | 248,181 | 0 | 157,145 | 55,545 | 893,893 |
| Capital investments | 40,025 | 24,001 | 0 | 0 | 0 | 64,026 |
| Liabilities (segments) | 244,545 | 154,087 | 0 | 68,806 | 5,246 | 472,684 |

Gross earnings of the segments do not include depreciation, amortisation and interest expenses. Consequently, there is an asymmetry between interest expenses and liabilities.

The segment mortgage deeds includes fair value adjustments relating to credit risks of kDKK 15,967 (kDKK 14,787). The financial period saw a negative fair value adjustment relating to credit risks on mortgage deeds and mortgage deed receivables of kDKK 1,212 (kDKK -74). Fair value adjustments relating to credit risks are based on an individual assessment of each claim.

For all segments, gross earnings include the item fair value adjustment, which is not a cash income/expense.

The liabilities in the segment reporting can be reconciled with group totals as follows:

	Group
	2015/16
DKK ‘000	2014/15
DKK ‘000
Liabilities, segments	551,729	472,684
Other payables	17,345	18,248
Forward contracts and currency swaps	253	224
Deferred income	996	357
Segment liabilities	570,323	491,513

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 17 of 19

	GROUP
	2015/16 DKK '000	2014/15 DKK '000
1. Financial income
Mortgage deeds, interest	10,778	6,816
Bonds, interest	3,087	4,596
	13,865	11,412
Capital gains, mortgage deeds	1,284	460
Capital gains, bonds	-16,702	-299
Capital gains, shares	0	102
Forward contracts	-896	-936
Exchange adjustments, securities	2,488	2,572
Other financial income	691	-217
	730	13,094

2. Net loss/gain and direct expenses

Realised net losses on mortgage deeds and mortgage deed receivables. 761 5,987

Change of fair value adjustment of credit risk, mortgage deeds and mortgage deed receivables. 1,212 -74

Gain/loss on sale of properties acquired for the purpose of resale ... 132 -493

Provision for losses on properties acquired for the purpose of resale ... -175 -2,600

Bad debts recovered 806 415

-1,124 -2,405

Fees. 141 46

Collection charges 29 78

-1,294 -2,529

3. Fair value adjustment of financial assets

Fair value adjustment, mortgage deeds 252 1,238

Fair value adjustment, bonds 1,988 -14,912

Fair value adjustment, shares 64 0

1,800 -13,674

4. Staff expenses

Remuneration of Supervisory Board 144 181

Wages and salaries 2,378 2,107

Defined contribution plan 134 171

Other social security expenses 19 17

Other staff, total 2,531 2,295

Total staff expenses 2,675 2,476

Average number of employees 10 10

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Investeringsselskabet Luxor A/S
INTERIM REPORT
page 18 of 19

Note 4 continued

Pursuant to the Danish Act on Alternative Investment Fund Managers etc, it can be stated that the remuneration policy and practice are in accordance with the requirements concerning sound and effective risk management. In the Parent Company, remuneration of the Executive Board and an employee, a total of three persons, who have a significant influence on the Parent Company’s risk profile amounts to DKK 1.1 million.

	GROUP
	2015/16 DKK ‘000	2014/15 DKK ‘000
5. Financial expenses
Credit institutions	3,218	2,933
Interest swaps, credit institutions	-2	58
Interest swaps, credit institutions, fair value adjustment	852	122
Exchange loss/gain on foreign loans etc, net	3,970	4,212
	8,038	7,325
Mortgage credit institutes	467	438
Interest swaps, mortgage credit institutes	311	214
Mortgage credit institutes, fair value adjustment	154	-103
Interest swaps, mortgage credit institutes, fair value adjustment	35	1,193
Expenses and loss on conversion of debt to mortgage credit institutes	0	120
	9,005	9,187
6. Corporation tax
Tax on profit/loss on ordinary activities for the period is specified as follows:
Calculated tax 22% (23.5%) on profit/loss before tax for the period	-2,090	-3,123
Tax effect of:
Non-taxable income, expenses, value adjustments, etc	-6	-26
Reduction of the tax rate from 23.5% to 22% up until 2016	0	258
	-2,096	-2,891
Effective tax rate	22.07%	-21.76%
Tax asset at 1 October 2015	36,350	34,521
Transferred to DI-Ejendoms Invest A/S	-212	-172
Change in deferred tax recognised in the income statement	2,266	3,058
Tax asset at 31 December 2015	38,404	37,407
Deferred tax at 1 October 2015	24,049	23,922
Change in deferred tax recognised in the income statement	-42	-4
Deferred tax at 31 December 2015	24,007	23,918
Total tax asset at 31 December 2015	14,397	13,489

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Investeringsselskabet Luxor A/S INTERIM REPORT
page 19 of 19

Note 6 continued:

	GROUP
	2015/16 DKK ‘000	2014/15 DKK ‘000
The deferred tax asset is recognised at the tax rate which is expected to be applicable when the deferred tax is realised. The calculation has been made at 22% (23.5%). The value is distributed on the following items:
Tax asset:
Property, plant and equipment	-23,907	-23,900
Fixed asset investments, mortgage deeds, bonds and fair value adjustments relating to mortgage credit institutes and credit institutions, etc..	1,046	1,218
Tax loss carry-forwards	37,258	36,171
Tax asset	14,397	13,489

When measuring deferred tax, the Company applies the corporation tax rate which is expected to be applicable to the temporary differences in the financial years in which the Company’s temporary differences are expected to be realised.

The tax asset is recognised to the extent that it is expected to be realised in the form of future taxable profits. It is assessed that the tax asset of DKK 14.4 million (DKK 13.5 million) can be realised within a period of up to five years. Utilisation of the tax asset is assessed on the basis of expected basic earnings and gains on redemptions on the Company’s portfolio of bonds.

The loss on the Group’s portfolio of shares which is deductible against income from like-kind source is not recognised in the tax loss. At 31 December 2015, the loss amounts to DKK 97.6 million (DKK 97.6 million) measured on the basis of a tax rate of 22%. Utilisation of the tax loss is not time-limited.

	GROUP
	2015/16 DKK million	2014/15 DKK million
7. Statement of basic earnings
Financial income	15.8	11.6
Rental income	3.5	3.7
Other income	0	0.3
Net loss/gain and direct expenses	1.3	2.5
Direct expenses, properties	1.0	1.6
Financial expenses	4.0	3.6
Other external expenses	1.4	0.8
Staff expenses	2.7	2.5
Depreciation and amortisation	0.1	0.1
Basic earnings	8.8	4.5