Subject: Creation of an additional revaluation write-off due to impairment of assets.
Legal basis - Article 17 section 1 of MAR concerning inside information.
Contents of the report:
The Management Board of the company J.W. Construction Holding S.A. with its registered office in Ząbki (the "Company") announces publicly that today it made a decision to create an additional revaluation write-off in the amount of approx. PLN 12 million for loans granted to the subsidiary Yakor House based in Sochi (Russian Federation).
As at March 31, 2021, the value in the Company's books of accounts of loans granted to Yakor House, after previously made revaluation write-offs, amounted to PLN 16.5 million.
The provision was created due to the information provided by the subsidiary Yakor House with its seat in Sochi (Russian Federation) regarding the sale of the ownership title to buildings located in Sochi in the Yakornaya Schel Szcziel estate at Glavnaya 34 street together with the assignment of rights under the lease agreement of the plot of land on which they are located for a gross amount including local VAT in the amount equivalent to EUR 1,368,000.
The subject of the sale are the objects constituting the main asset of Yakor House.
Yakor House has decided to sell the real estate for the price indicated above, due to a significant change in the conditions prevailing in Sochi. Pursuant to the new regulations, issuing permits for multi-family construction has been suspended until the adoption of a new city development plan. There is a high probability that in the new spatial development plan, the possibility of using the property for investment purposes will be significantly reduced, due to its location in the immediate vicinity of the national park among other reasons.
The above additional write-off does not affect the liquidity position of the Company and its Capital Group.
The estimated impact of the write-offs described above will not affect the consolidated net result. The unit net result will be affected by approximately minus PLN 9.7 million.
Detailed and final data will be presented in the consolidated report for the first half of 2021.