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Events that have a material impact on the result for Q3 2018


The Management Board of LC Corp S.A., the “Issuer”, with reference to the publication of the consolidated quarterly report for Q3 2018 planned for 15 November 2018 hereby reports that:

I.

The LC Corp S.A. Capital Group has recognised in the financial results for Q3 2018 the amounts resulting from a significant change in the EUR rate and having a material impact on the gross result in the period, i.e.:

  1. for three quarters of 2018 cumulatively (period from 01/01/2018 to 30/09/2018):
    • Increase of the fair value of investment property whose valuation is made in EUR and is converted to PLN, in the amount of PLN 42,202 thousand. This amount will be recognised in the consolidated statement of comprehensive income in “Revaluation of non-financial fixed assets”
    • Increase of the valuation of liabilities resulting from loans in EUR taken in connection with the construction of investment property in the amount of PLN 13,945 thousand. This amount will be recognised in the consolidated statement of comprehensive income in “Financial expenses”

The effect of the change of the EUR rate described in paragraph I. (the EUR rate as at 30 September 2018 was PLN 4.2714, i.e. it was higher by EUR 0.1005 as compared to the EUR rate as at 31 December 3017 which was PLN 4.1709) on the consolidated gross financial result of the Group for three quarters of 2018 was PLN 28,527 thousand and resulted in the increase of the consolidated gross profit by this amount.

  1. for Q3 2018 (period from 01/07/2018 to 30/09/2018):
    • Decrease of the fair value of investment property whose valuation is made in EUR and is converted to PLN, in the amount of PLN 37,878 thousand. This amount will be recognised in the consolidated statement of comprehensive income in “Revaluation of non-financial fixed assets”
    • Decrease of the valuation of liabilities resulting from loans in EUR taken in connection with the construction of investment property in the amount of PLN 11,918 thousand. This amount will be recognised in the consolidated statement of comprehensive income in “Financial income”

The effect of the change of the EUR rate described in paragraph I. (the EUR rate as at 30 September 2018 was PLN 4.2714, i.e. it was lower by EUR 0.0902 as compared to the EUR rate as at 31 December 3017 which was PLN 4.3616) on the consolidated gross financial result of the Group in Q3 2018 was PLN 25,960 thousand and resulted in a decrease of the consolidated gross profit by this amount.

 

The change of the EUR rate is of a non-cash nature and has no effect on the ongoing situation and operating activities of the LC Corp S.A. Capital Group.

 

II.

The LC Corp S.A. Capital Group has recognised in the results for Q3 2018 the material amount resulting from a significant change in the fair value of investment properties and having a material impact on the gross result in the period, i.e.:

The effect of the recognition of the valuations of investment property described in paragraph II. on the consolidated gross financial result of the Group for the three quarters of 2018 amounted to PLN 21,780 thousand and resulted in a decrease of the consolidated gross profit by this amount. The change of the above valuations in of a non-cash nature.

 

The total effect of the changes described in paragraphs I. and II. on the consolidated gross financial result of the Group for Q3 2018 amounted to PLN 6,747 thousand and resulted in an increase of the consolidated gross profit by this amount.

The total effect of the changes described in paragraphs I. and II. on the consolidated gross financial result of the Group for Q3 2018 amounted to PLN 32,965 thousand and resulted in a decrease of the consolidated gross profit by this amount.

The change of the above valuations in of a non-cash nature.

 

III.

LC Corp S.A. has recognised in the financial results for Q3 2018 significant amounts which have a material impact on the gross financial result in the period due to:

  • received dividends and shares in profit, whose total amount in the statement of comprehensive income for three quarters of 2018 amounted to PLN 136,899 thousand, of which PLN 63,176 thousand has been recognised in the results for Q3 2018,
  • the valuation of the property Retro Office House described in paragraph II. above that had a material impact on the reversal of the impairment loss for the Issuer’s shares in LC Corp Invest XI sp. z o.o. in the gross amount of PLN 6,514 thousand, of which PLN 1,064 thousand has been recognised in the results for Q3 2018. This amount will increase the non-consolidated financial result of the Issuer for the three quarters of 2018.

These revenues have no impact on the consolidated financial result of the LC Corp S.A. Group.

 

In the opinion of the Management Board of the Issuer this information is confidential within the meaning of Art. 17 para. of the Regulations of the European Parliament and of the Council (EU) No. 596/2014 of 16 April 2014 on market abuse.