Tigné Point developer Midi registers post-tax loss of €1.05 million

Tigné Point and Manoel Island developers Midi plc said the company had only been marginally affected by a significantly subdued financial situation in the eurozone, in its six-monthly statement published today.

"Understandably the property market continued to present challenges... Midi's quality developments are only marginally affected by these conditions, even though one cannot expect Malta to be totally insulated from the fortunes of those markets that we interact with."

Midi said that delays by MEPA in the issuing of permits for the next phases in Tigné Point had slowed down the project's pace of development activity, resulting in a very limited number of apartments becoming available for sale.

During the period, the group's bankers and a number of restricted shareholders supported the group's short-term financial requirements.

"The Group continues to review its funding strategy in order to sustain its long‐term prospects for the development of other phases in both Tigné Point and Manoel Island. The Group's long‐term funding requirements may also result in changes to the use of the asset base pertaining to the different phases of the project."

The second half of the year is forecast to experience low property sales both as a result of the limited residential unit stock availability as well as a pause in property demand until signs of a eurozone recovery begin to appear. As a result the group is expecting an overall operational loss for the financial year of 2012.

Group post-tax financial results for the first half of 2012 showed a loss of €1.05 million (2011: €1.03 million profit). This result was in line with forecasts as the number of residential units delivered had decreased substantially since contracts of sale for most of its stock of apartments were completed by the end of 2011.

Out of a total revenue of €5 million (2011: €22.9 million), that from development and sale of property amounted to €2.2 million (2011: €20.5 million).

Revenue and contribution from the group's rental operations continued to improve. Both 'The Point' shopping mall and also the underlying car park have shown significant improvement. Income from a number of retail outlets available at Pjazza Tigné has further contributed to this improvement.

Construction works during these six months were directed towards the completion of the Pjazza Tigné apartments. These are expected to be fully complete within the current financial year.

During the second half of 2012 MIDI Group expects to deliver all apartments that are currently under Promise of Sale Agreements (konvenju) as well as maintain positive trends from the group's rental operations.

"The success of this long-term project also depends on the smooth transition between one phase and another and therefore all necessary permits need to be issued in a timely fashion so as to ensure efficient progress. Shortly we shall be embarking on the final phases of Tigné Point which shall include a 14,000 square-metre Business Centre; the final 102 apartments at Tigné Point and a limited number of retail outlets. Works on the 36 apartment residential block (T17 East) are expected to commence in Q4 2012," Midi said.