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Impact of Foreign Exchange Differences on Result for 3Q of 2017


Due to the fact that the publication of the consolidated quarterly report for the 3Q of 2017 was scheduled on 13 November 2017, the Management Board of LC Corp S.A. (the “Issuer”) informs that the LC Corp S.A. Group has cumulatively recognised in the results of the 3Q of 2017 and three quarters of 2017 amounts resulting from a significant change in the EUR exchange rate and having considerable impact on the gross result in the period, i.e.:

  1. for three quarters of 2017, cumulatively (the period from 01/01/2017 to 30/09/2017):
    • a decrease in the fair value of investment properties, which is measured in EUR and translated into PLN, in the amount of PLN 45,793,000. The said amount will be recognised in the “consolidated statement of comprehensive income” under the item “ Revaluation of non-financial fixed assets”;
    • a decrease in the measurement of loan liabilities for loans taken out in EUR in connection with the construction of investment properties in the amount of PLN 21,038,000. The said amount will be recognised in the “consolidated statement of comprehensive income” under the item “Financial income”.

The cumulative overall impact of the change in the EUR exchange rate (the EUR exchange rate as at 30 September 2017 was PLN 4.3091, i.e. a decrease by PLN 0.1149 was reported compared with the EUR exchange rate as at 31 December 2016, which was PLN 4.4240) on the consolidated financial performance of the Group for three quarters of 2017 was PLN 24,755,000 and as a consequence, reduced the consolidated gross profit by the said amount. 

  1. for the 3Q of 2017 (the period from 01/07/2017 to 30/09/2017):
    • an increase in the fair value of investment properties, which is measured in EUR and translated into PLN, in the amount of PLN 32,918,000. The said amount will be recognised in the “consolidated statement of comprehensive income” under the item “ Revaluation of non-financial fixed assets”;
    • an increase in the measurement of loan liabilities for loans taken out in EUR in connection with the construction of investment properties in the amount of PLN 10,131,000. The said amount will be recognised in the “consolidated statement of comprehensive income” under the item “Financial income” (the reduction of value).

The cumulative overall impact of the change in the EUR exchange rate (the EUR exchange rate as at 30 September 2017 was PLN 4.3091, i.e. an increase by PLN 0.0826 was reported compared with the EUR exchange rate as at 30 June 2017, which was PLN 4.2265) on the consolidated financial performance of the Group for the 3Q of 2017 was PLN 22,787,000 and as a consequence, increased the consolidated gross profit by the said amount.

The change in the EUR exchange rate is of non-pecuniary nature and has no effect on the current position and operational activity of companies belonging to the LC Corp Group.

 

This information, according to the Issuer’s Management Board, constitutes inside information within the meaning of Article 17(1) of the Regulation (EU) No. 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse.