MIH lops €60.9 million off Palm City asset value

Reduced occupancy levels in Palm City in the Janzour outskirts of Tripoli, in war-torn Libya, has pushed the value of the asset down by €60.9 million from its €310 million in 2013.

Mediterranean Investments Holding plc announced an operating profit of €21.8 million for 2014, down from €22.9 million in 2013.

MIH said it had “prudently decided” to reduce the value of the Palm City asset, but the impairment of €60.9 million was adjusted by a reduction in deferred tax of €20.8 million, resulting in a net impairment of €40.1 million.

The company said reported a strong performance during the first six months of 2014, exceeding targets for the period as well as the comparative period in 2013. “MIH has managed to record a strong performance in 2014 despite a challenging six months in the second part of the year,” MIH chairman Alfred Pisani, of the Corinthia and IHI groupsm said.

However this positive performance was overshadowed by the events that unfolded in Libya later in the year, from July onwards, resulting in a reduction in revenue principally brought about by a decrease in occupancy during the last three months of 2014.

Total revenue for 2014 amounted to €30.1 million.Reduced business levels experienced towards the second half of 2014 led management to act swiftly to curtail costs and successfully managed to maintain a high conversion rate of 72% of revenue to EBITDA.

Net profit after interest expense, tax but before net impairment charges amounted to €12 million.