In accordance with the Term and Conditions the IFRS conversion need to be in effect from Q3 2015. Thus, the result of Q3 2015 is not comparable to the budget due to several accounting adjustments. However, the result of the operating activities is not affected by the change of the accounting principle. Revenues and operating costs are in general at expected level in both operating entities; Galliaden AB and Turku Ausade Hotelli Oy. The operating costs are lower than budget as the expected varnishing of the arena floor in the multipurpose hall has not taken place due to the new tenant.
Administrative costs are significantly less than budget due to overestimated costs relating to the prospectus, accountants, and attorneys. Moreover, the extraordinary administrative costs in relation to the IFRS conversion and auditing have been postponed until next quarter. The SEK 1 m depreciation has likewise been activated in Q3 2015. It regards the finance fee paid out in 2014.
Tax is being regulated at the end of a financial year. Moreover, tax in Q3 2015 reflects the IFRS conversion.regarding deferred tax. Depreciations are likewise affected by IFRS, therefore they are positive in Q3 2015.
Financial costs are at a high level as Q1 - Q3 2015 interest costs on the shareholder's loan are included. It regards approx. SEK 2,2 m that are not paid out but rolled up. If interest costs on the shareholder's loan are deducted interest costs on the bond issue is at an expected level, SEK 11,4 m.
Moreover, exchange adjustments are not realized. After deduction of the ABG finance fee, interests costs on the shareholder's loan, exchange adjustments, and depreciations from EBT the result is approx. SEK 8,4 m.
Cash accumulates and is at a higher level compared to previous year. However, amortization is solely effective once a year starting from Q4 2015 which will affect the cash position. Amortization will in the future be done in Q3, cf. the Term and Conditions. Moreover, the new tenant at Turku Ausade Hotelli Oy has a four months' rent-free period, ending in January 2015, resulting in no rental income from the Finnish subsidiary until February 2016. Thus, the cash position will drop considerably at the end of the year.
All covenant tests are met.
HUG#1969987
