AX GROUP P.L.C.Annual Report and Consolidated and Separate Financial Statements for the year-ended 31 October 2022
Notes to the Financial Statements – continued
30.DEBT SECURITIES IN ISSUE
Group and Company
During 2022, AX Real Estate p.l.c., a subsidiary of the Company, issued an aggregate principal amount of EUR40,000,000 (2022 – 2032), having a nominal value of EUR100 each, bearing interest at the rate of 3.5% per annum. EUR21,645,400 were assigned to the Company as part conversion of the loan receivable from AX Real Estate p.l.c. as described in Note 22. These bonds are unsecured and subject to the terms and conditions in the prospectus dated 6 December 2021. The bonds are listed on the Official Companies List of the Malta Stock Exchange. The quoted market price as at 31 October 2022 for the 3.5% bonds (2022 – 2032) was EUR97.01. The fair value of the bonds as at 31 October 2022 amounted to EUR38,265,665. The carrying value of the bond as at 31 October 2022 amounted to EUR39,500,567. Interest on the bonds is due and payable annually in arrears on 7 February of each year at the above-mentioned rate.
As at year-end, AX Real Estate p.l.c. had a balance of EUR39,500,567 from this bond issue. The amount is made up of the bond issue of EUR18,354,600 net of the bond issue costs which are being amortised over the lifetime of the bonds and of EUR21,645,400 were assigned to AX Group p.l.c. as described above.
During 2020, AX Group p.l.c. issued an aggregate principal amount of EUR25,000,000 bonds, split in two tranches of EUR15,000,000 (2020 – 2026) and EUR10,000,000 (2020 – 2029), having a nominal value of EUR100 each, bearing interest at the rate of 3.25% and 3.75% respectively per annum. These bonds are unsecured and subject to the terms and conditions in the prospectus dated 22 November 2019. The bonds are listed on the Official Companies List of the Malta Stock Exchange. The quoted market price as at 31 October 2022 for the 3.25% bonds (2020 – 2026) was EUR100 (2021: EUR102.25) and for the 3.75% bonds (2020 – 2029) was EUR99.99 (2021: EUR103). The fair value of the bonds as at 31 October 2022 amounted to EUR15,000,000 (2021: EUR15,337,500) and EUR9,999,000 (2021: EUR10,303,000) respectively, which amounts to an aggregated fair value of EUR24,999,000 (2021: EUR25,640,500). The carrying value of the bonds as at 31 October 2022 amounted to EUR24,736,174 (2021: EUR24,689,873).
As at year-end, the Company had a balance of EUR24,736,174 from this bond issue. The amount is made up of the bond issue of EUR25,000,000 net of the bond issue costs which are being amortised over the lifetime of the bonds.
In addition to the above, during 2014, AX Investments p.l.c., a subsidiary company, issued an aggregate principal amount of EUR40,000,000 bonds (2014 -2024), having a nominal value of EUR100 each, bearing interest at the rate of 6% per annum. These bonds are unsecured and subject to the terms and conditions in the prospectus dated 3 February 2014. The bonds are listed on the Official Companies List of the Malta Stock Exchange. The quoted market price as at 31 October 2022 for the 6% bonds (2014 – 2024) was EUR103.5 (2021: EUR104). The fair value of the bond as at 31 October 2022 amounted to EUR41,400,000 (2021: EUR41,600,000). The carrying value of the bond as at 31 October 2022 amounted to EUR39,913,935 (2021: EUR39,851,606). Interest on the bonds is due and payable annually in arrears on 6 March of each year at the above-mentioned rate. In terms of the offering memorandum of the “6% AX Investments p.l.c. 2024 Bond”, AX Group p.l.c., has provided a corporate guarantee in favour of the bondholders to affect the due and punctual performance of all payment obligations undertaken by the subsidiary under the bonds if it fails to do so.
As at year-end, AX Investments p.l.c. had a balance of EUR39,913,935 from this bond issue. The amount is made up of the bond issue of EUR40,000,000 net of the bond issue costs which are being amortised over the lifetime of the bonds. Interest on the bonds is due and payable annually in arrears on 6 March at the above-mentioned rate.
Management intends that upon its redemption date, being 6 March 2024, the bond will be repaid or rolled over. Such repayment is dependent on the Group’s ability to raise further liquidity. As a result, management is considering alternative financing options, including the issuance of a new bond by AX Group p.l.c., with the proceeds therefrom committed to be advanced to AX Investments p.l.c.
As at year-end, the Group had a balance of EUR82,423,921 from the bond issues. The amount is made up of the bond issues of EUR83,354,600 net of bond issue costs which are being amortised over the life of the bonds.