1.  Segments reporting

 

The Group has identified the following operating segments, based on the reports presented to the Group's Management, which are used in the process of strategic decision-making:

 

· Wholesale of fuels - wholesale of petroleum products in Bulgaria;

· Retail of fuels - retail of petroleum and other products through a network of petrol stations.

· Other activities - financial and accounting services, consultancy, rental income and other activities.

The segment information, presented to the Group's Management for the periods ended as of June 30, 2020 and 2019 is as follows:

 

June 30 2020	Wholesale of fuels		Retail of fuels		All other segments		Total for the Group
	BGN'000		BGN'000		BGN'000		BGN'000
Total segment revenue	11,220		173,823		1,362		186,405
Intra-group revenue	-		58		821		879
Revenue from external customers	11,220		173,765		541		185,526
Adjusted EBITDA	1,501		(2,404)		(3,177)		(4,080)
Depreciation/amortization	1,137		1,503		163		2,803
Impairment	-		278		1,903		2,181

 

June 30 2019	Wholesale of fuels		Retail of fuels		All other segments		Total for the Group
	BGN'000		BGN'000		BGN'000		BGN'000
Total segment revenue	11,749		242,247		1,221		255,217
Intra-group revenue	5		9		716		730
Revenue from external customers	11,744		242,238		505		254,487
Adjusted EBITDA	2,747		(4,662)		482		(1,433)
Depreciation/amortization	563		1,273		88		1,924
Impairment	-		(67)		-		(67)

 

The policies for recognition of revenue from intra-group sales and sales to external clients for the purposes of the reporting by segments do not differ from these applied by the Group for revenue recognition in the consolidated statement of profit and loss and other comprehensive income.

 

The Management of the Group evaluates the results of the performance of the segments based on the adjusted EBITDA. In the calculation of the adjusted EBITDA the effect of the impairment of assets is not taken into account. The reconciliation of the adjusted EBITDA and the profit (loss) before tax is presented in the table below:

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Adjusted EBITDA - reporting segments	(347)		(1,915)
Adjusted EBITDA - all other segments	629		482
Depreciation/amortization	(2,803)		(1,924)
Impairment of assets	(2,181)		67
Finance income (costs), net	(1,661)		(3,749)
Profit (loss) before tax	(6,363)		(7,039)

 

 

2.  Revenue from sales

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Sales of goods	180,952		248,567
Sales of services	4,192		5,046
	185,144		253,613

 

 

3.  Other income

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Surpluses of assets	180		618
Payables written off	96		-
Income from financing	86		-
Penalties and indemnities	10		19
Insurance claims	10		6
Gain on sale of property, plant, equipment and materials including:	-		123
Income from sales	-		213
Carrying amount	-		(90)
Other	-		108
	382		874

 

As a result of the negative impact and consequences of the global pandemic from the spread of a new type of coronavirus - Covid-19, the Group has taken a series of actions to reorganize the activities of some of its trade sites and establish reduced working hours for some of the staff. From the end of March 2020, the Employment Agency opens an application procedure under Art. 1 of Decree №55 of March 30, 2020 on determining the terms and conditions for payment of compensations to employers in order to maintain the employment of employees in the state of emergency, declared by a Decision of the National Assembly as of March 13, 2020. The Group has submitted documents for application under this procedure and as of June 30, 2020 has received funding from the state in the amount of BGN 86 thousand.

 

 

4.  Materials and consumables

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Electricity and heating	1,013		1,049
Office consumables	196		210
Fuels and lubricants	189		233
Spare parts	122		147
Working clothes	99		38
Water supply	51		46
Advertising materials	14		23
Other	86		63
	1,770		1,809

 

 

5.  Hired services

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Rents	7,488		7,907
Dealer and other commissions	5,320		5,792
Maintenance and repairs	1,571		1,775
Consulting, training and audit	760		805
Communications	417		420
State, municipal fees and other costs	404		278
Cash collection expense	315		363
Security	305		331
Insurances	181		215
Advertising	159		130
Software licenses	126		128
Transport	25		58
Other	253		309
	17,324		18,511

 

 

6.  Employee benefits

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Wages and salaries	7,662		8,856
Social security contributions and benefits	1,645		1,556
	9,307		10,412

 

 

7.  Other expenses

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Local taxes and taxes on expenses	162		153
Entertainment expenses and sponsorship	60		133
Penalties and indemnities	28		61
Scrap and shortages	17		35
Business trips	6		19
Loss on sale of property, plant, equipment and materials including:	3		-
Carrying amount	45		-
Income from sales	(42)		-
Other	13		11
	289		412

 

 

8.  Finance income and costs

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Finance income
Interest income, including	967		867
Interest income on loans granted	900		789
Interest income on trade receivables	67		78
Gain on sale of subsidiaries, incl.:	-		562
Revenue from sales	-		950
Carrying amount of the Group's interest in the net assets of the subsidiaries	-		(388)
Net foreign exchange gain	2		8
	969		1,437
Finance costs
Interest costs, including:	(2,396)		(1,904)
Interest expenses on debenture loans	(1,287)		(1,268)
Interest expenses on the lease	(483)		(331)
Interest expenses on bank loans	(221)		(272)
Interest expenses to the state budget	(19)		(21)
Interest expenses on trade and other payables	(386)		(9)
Interest expenses on trade loans	-		(3)
Loss from cession contracts	-		(3,056)
Bank fees, commissions and other financial expenses	(234)		(226)
	(2,630)		(5,186)
Finance income (costs), net	(1,661)		(3,749)

   

9.  Taxation

 

9.1.  Tax expenses

 

Tax expense recognised in profit or loss includes the amount of current and deferred income tax expenses in accordance with IAS 12 Income taxes.

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Current tax expense	-		-
Change in deferred tax, including:	(461)		(32)
Temporary differences recognised during the period	96		121
Temporary differences arising during the period	(360)		(108)
Adjustments	(197)		(45)
Tax income	(461)		(32)

 

9.2.  Effective tax rate

 

The reconciliation between the accounting loss and tax expense, as well as calculation of the effective tax rate as of June 30, 2020 and June 30, 2019 is presented in the table below:

 

	June 30 2020 BGN'000		June 30 2019 BGN'000
Loss before tax for the period	(6,363)		(7,039)
Applicable tax rate	10%		10%
Tax expense at the applicable tax rate	(636)		(704)
Tax effect of permanent differences	16		55
Tax effect of a tax asset recognized in the current period that arose but was not recognized in previous reporting periods	-		(201)
Tax effect of a tax asset not recognised in the current period that arose in the current period	371		719
Tax effect of adjustments to a recognized tax asset that arose in previous reporting periods	(197)		-
Tax effect from consolidation adjustments	(15)		99
Tax income	(461)		(32)
Effective tax rate	-		-

 

The respective tax periods of the Group may be subject to inspection by the tax authorities until the expiration of 5 years from the end of the year in which a declaration was submitted, or should have been submitted. Consequently additional taxes or penalties may be imposed in accordance with the interpretation of the tax legislation. The Group's management is not aware of any circumstances, which may give rise to a contingent additional liability in this respect.

 

In January 2017, the Parent company received a tax audit assessment on corporate tax revision for 2013 and VAT until October 2014 amounting to BGN 222 thousand principal and BGN 68 thousand interest. In order to cease the enforcement of the appealed tax assessment in January 2017, a bank guarantee of BGN 350 thousand was issued. In order to secure the additionally calculated interest liabilities on this tax assessment, in February 2019 was issued an additional bank guarantee for BGN 60 thousand. In April 2019 the Administrative Court - Sofia city enacted a decision, which entirely repealed the obligation for VAT amounting to BGN 112 thousand principal and BGN 37 thousand interest and considerably reduced the corporate tax liability from BGN 110 principal and BGN 31 thousand interest to BGN 24 thousand principal and BGN 2 thousand interest. In February 2020, with a final decision of the Supreme Administrative Court, the Decision of April 2019 of the Sofia City Administrative Court was partially revoked, as at the date of preparation of these financial statements the obligation was fully paid and the bank guarantees released and returned from NAP. Liabilities are recorded as adjusting events as of December 31, 2019 and are reflected in the result for 2019.

 

In November 2017 the issued tax assessment from March 2016 on the security contributions tax audit for BGN 543 thousand principal and BGN 248 thousand interest, appealed entirely by the Parent company as unjustified and secured by a bank guarantee of BGN 800 thousand, was entirely repealed due to decision of Administrative Court - Sofia city. The tax administration appealed the decision and SAC repealed the decision of AC - Sofia city and returned the court proceeding to the initial judicial body for new examination. In order to secure the additionally calculated interest liabilities on this tax assessment, an additional bank guarantee for BGN 255 thousand was issued in February 2019. With a decision from March 2020. the first-instance court has partially annulled the appealed amended assessment, as a result the liabilities of the Parent company have been reduced to BGN 53 thousand. The Appel and Tax Insurance Practice has appealed the decision of the first-instance court and the case is currently pending.

 

9.3.  Recognised deferred tax assets and liabilities

 

	Asset (liability) as at January 1, 2019	Recognised in profit and loss	Asset (liability) as at December 31, 2019	Recognised in profit and loss	Recognised in other compre-hensive income	Asset (liability) as at June 30, 2020
	BGN'000	BGN'000	BGN'000	BGN'000	BGN'000	BGN'000
Property, plant and equipment	(198)	23	(175)	213	(2,771)	(2,733)
Impairment of assets	4,192	(85)	4,107	218	-	4,325
Tax loss carry-forwards	39	(30)	9	12	-	21
Provisions for unused paid leave and other provisions	105	20	125	(2)	-	123
Excess of interest payments in accordance with CITA	3	101	104	53	-	157
Other temporary differences, including unpaid benefits to individuals	45	1	46	(33)	-	13
	4,186	30	4,216	461	(2,771)	1,906

 

The Company has the right to carry forward deferred tax assets on tax losses until 2025.

 

9.4.  Unrecognized deferred tax assets

 

As of June 30, 2020 the Group's Management reviews the recoverability of deductible temporary differences and tax loss carry forward, forming tax assets. Because of this review, the Group's Management estimates that there might be no sufficient taxable profits in the near future against which the assets will be utilized. Consequently, the Group does not recognize tax assets on the following deductible temporary differences and tax loss carry forward and impairment of assets, incurred during the current and previous reporting periods.

 

10.  Property, plant, equipment and intangible assets

 

	Land     BGN'000		Buildings     BGN'000		Plant and equipment   BGN'000		Vehicles     BGN'000		Other     BGN'000		Assets under constr. BGN'000		Intangible assets   BGN'000		Total     BGN'000
Cost Balance at January 1, 2019	6,958		6,031		10,748		572		1,805		185		3,560		29,859
Additions	2		79		53		-		44		279		3		460
Transfers	-		61		9		-		169		(239)		-		-
Disposals	(139)		(264)		(1,099)		-		(105)		-		(3,017)		(4,624)
Balance at June 30, 2019	6,821		5,907		9,711		572		1,913		225		546		25,695
Additions	437		847		339		-		66		155		222		2,066
Transfers	-		42		60		-		1		(103)		-		-
Disposals	(57)		(35)		(394)		-		(136)		(33)		(93)		(748)
Balance at December 31, 2019	7,201		6,761		9,716		572		1,844		244		675		27,013
Additions			-		13		-		13		254		20		300
Transfer of assets held for sale	2,345		700		381		-		4		-		-		3,430
Transfers	-		-		146		-		123		(269)		-		-
Netting accumulated depreciation	-		(3,867)		(6,707)		(561)		(937)		-		(452)		(12,524)
Revaluation	4,817		2,598		16,142		419		1,570		-		308		25,854
Impairment losses	(1,751)		(554)		(113)		-		(13)		(34)		-		(2,465)
Disposals	-		(13)		(25)		-		(2)		(5)		-		(45)
Balance at June 30, 2020	12,612		5,625		19,553		430		2,602		190		551		41,563
Accumulated depreciation
Balance at January 1, 2019	-		3,771		7,656		560		942		-		3,432		16,361
Accumulated	-		89		231		-		87		-		15		422
Disposals for the period	-		(52)		(1,003)		-		(68)		-		(2,906)		(4,029)
Balance at June 30, 2019	-		3,808		6,884		560		961		-		541		12,754
Additions	-		83		209		1		97		-		2		392
Transfers	-		(1)		1		-		-		-		-		-
Disposals	-		(23)		(387)		-		(121)		-		(91)		(622)
Balance at December 31, 2019	-		3,867		6,707		561		937		-		452		12,524
Additions	-		102		375		5		103		-		26		611
Disposals	-		-		(2)		-		-		-		-		(2)
Netting accumulated depreciation	-		(3,867)		(6,707)		(561)		(937)		-		(452)		(12,524)
Balance at June 30, 2020	-		102		373		5		103		-		26		609
Carrying amount at January 1, 2019	6,958		2,260		3,092		12		863		185		128		13,498
Carrying amount at June 30, 2019	6,821		2,099		2,827		12		952		225		5		12,941
Carrying amount at December 31, 2019	7,201		2,894		3,009		11		907		244		223		14,489
Carrying amount at June 30, 2020	12,612		5,523		19,180		425		2,499		190		525		40,954

 

As at June 30, 2020 property, plant and equipment with carrying amount of BGN 21,676 thousand are mortgaged or pledged as collaterals under bank loans, granted to the Group and to unrelated parties, under credit limit agreements for issuance of bank guarantees.

 

The assets under construction include mainly incurred expenses for reconstruction of trade sites.

 

From January 1, 2020 the Group has changed its approach to the subsequent valuation of property, plant and equipment under the revaluation model under IAS 16 and intangible assets under IAS 38. The revaluation model provides, after initial recognition for an asset, any property, plant and equipment whose fair value may to be measured reliably, to be carried at revalued amount, which is the fair value of the asset at the date of revaluation less any subsequent accumulated depreciation as well as subsequent accumulated impairment losses. Revaluations should be carried out at sufficiently regular intervals to ensure that the carrying amount does not differ materially from the fair value that would be determined using the fair value at the statement of financial position date.

 

Property, plant and equipment are presented in the financial statements at revalued amount, less accumulated depreciation and impairment losses.

The revalued (to fair) value of property, plant and equipment and intangible assets was initially determined through a market valuation by an independent appraiser and applied in the accounting policy as of January 1, 2020.  

 

 

11.  Assets and liabilities under leases

 

The consolidated statement of financial position as at June 30, 2020 and December 31, 2019 presents the following items and amounts related to lease agreements:

 

Consolidated statement of financial position	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Right-of-use assets, incl.:	13,627		10,221
Properties (lands and buildings)	4,793		5,513
Transport vehicles	1,034		378
Machinery, plants and equipment	7,800		4,330
Liabilities under leases, incl.:	(14,056)		(10,377)
Current liabilities Non-current liabilities	(4,519) (9,537)		(2,662) (7,715)
Net effect on equity	(429)		(156)

 

Costs recognised in the consolidated statement of comprehensive income

 

Consolidated statements of comprehensive income	June 30, 2020 BGN'000		June 30, 2019 BGN'000
Depreciation costs of right-of-use asset	2,169		1,479
Interest for right-of-use assets on lease contracts	483		331
	2,652		1,810

 

The total outgoing cash flow under lease agreements for right-of-use assets as at June 30, 2020 is BGN 2,257 thousand. The amount does not include the value added tax paid.

 

12.  Investment property

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Cost
Balance at the beginning of the period	1,883		1,883
Acquisitions	-		-
Balance at the end of the period	1,883		1,883
Accumulated depreciation
Balance at the beginning of the period	137		90
Depreciation	23		47
Balance at the end of the period	160		137
Carrying amount at the beginning of the period	1,746		1,793
Carrying amount at the end of the period	1,723		1,746

 

Investment property representing land and building were acquired through business combination in December 2016. The carrying amount of the investment property as at June 30, 2020 and December 31, 2019 is a maximum approximation of their fair value. The Group determines the fair value of the investment property for reporting purposes, using a valuation report of independent appraiser, which is calculated by method of net assets value and discounted free cash flows. The investment properties are part of a set of assets, which worth BGN 1,500 thousand, serving to secure the credit limit under a revolving credit line agreement concluded in 2016.

 

 

13.  Goodwill

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Cost	19,844		19,844
Impairment loss	-		-
	19,844		19,844

 

 

The recognised goodwill as at June 30, 2020 and December 31, 2019 arose as a result of the acquisition of the subsidiaries: Varna Storage EOOD at the amount of BGN 19,787 thousand, Lozen Asset AD at the amount of BGN 29 thousand and Petrol Technologies OOD at the amount of BGN 28 thousand.

 

 

14.  Inventory

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Goods, including:	16,494		20,469
Fuels	9,331		12,733
Lubricants and other goods	7,163		7,736
Materials	607		607
	17,101		21,076

 

 

15.  Non-current assets held for sale

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Non-current assets held for sale incl.:	42		3,472
Land	34		2,379
Buildings	8		708
Plant and equipment	-		381
Others	-		4
	42		3,472

 

In 2018 the Group has acquired trade sites - petrol stations and storage facilities on purpose to sell them. Classified in previous reporting periods as held for sale non-current assets amounting to BGN 3,430 thousand as of January 1, 2020 do not meet the criteria for recognition as such and are reclassified as property, plant and equipment.

 

 

16.  Loans granted

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Loans granted to unrelated parties, including	28,385		25,998
Initial value	39,608		37,230
Allowance for impairment	(11,223)		(11,232)
	28,385		25,998

 

In January 2019, the Group granted a cash loan to an unrelated party with a credit limit of up to BGN 5,500 thousand with an interest rate of 6.7% and additionally annexed until December 31, 2020. As of June 30, 2020 the receivables under the contract amount to BGN 5,181 thousand principal, net of impairment under IFRS 9, and BGN 444 thousand interest.

 

In April 2019 the Group entered into an agreement for granting a cash loan to an unrelated party with credit limit up to BGN 1,300 thousand at 6.7% annual interest. As June 30, 2020 the receivables under this contract are at the amount of BGN 1,293 thousand principal and BGN 108 thousand interest.

 

In May 2019 the Group granted a cash loan to an unrelated party with credit limit up to BGN 10 thousand and interest rate of 6.7%. As at June 30, 2020 the granted funds are at the amount of BGN 6 thousand.

 

In August 2019 the Group granted a cash loan to an unrelated party with credit limit up to BGN 1,000 thousand with interest rate of 6.7%, available in tranches for one year since the date of signing. In 2019, the loan limit has been increased. As of June 30, 2020, the loan principal has been repaid.

 

In February 2018 the Group granted a cash loan to unrelated party at the amount of BGN 2,000 thousand, subsequently the amount was increased to BGN 3,500 thousand at 6.7% interest and refund period until December 31, 2018. With annexes from the end of 2019 the credit limit was increased up to BGN 5,000 thousand and the term of loan was prolonged to December 31, 2020. As June 30, 2020 the receivables under this loan are BGN 4,431 thousand principal and BGN 426 thousand interest net of impairment.

 

In February 2020, the Group granted a cash loan to an unrelated party with a credit limit of up to BGN 1,000 thousand for a period up to December 18, 2020 and with an interest rate of 5.7%. The Group makes counter-offsets against trade receivables under a contract for the supply of goods. As of June 30, 2020 the Group has receivables in the amount of BGN 603 thousand principal and BGN 4 thousand interest.

 

In March 2018 the Group entered into an agreement for granting a cash loan to unrelated party with a credit limit up to BGN 300 thousand at 6.7% annual interest and repayment period until December 31, 2018. With an annex the term of the loan was prolonged until December 31, 2020. In 2019 the loan limit was increased, and as at June 30, 2020 the granted funds under this contract were BGN 648 thousand principal and BGN 54 thousand interest.

 

In November 2017 the Group signed two contracts for granting interest bearing loans with unrelated parties amounting up to BGN 5,050 thousand and up to BGN 6,150 thousand at 6.7% annual interest and term until December 31, 2020. The deadline is annexed to December 31, 2020.As at June 30, 2020 the granted amounts under these contracts are BGN 3,729 thousand net of impairments principal and BGN 883 thousand interest and BGN 4,443 thousand net of impairments principal and BGN 985 thousand interest.

 

In December 2017, the Group signed a contract for granting cash loan, which requires the Group to grant interest bearing loan up to BGN 3,000 thousand to unrelated party at 6.7% annual interest and term until December 31, 2020. As at June 30, 2020 the contracted amount was entirely granted.

 

 

17.  Trade and other receivables

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Receivables from clients, including	19,839		26,449
Initial value	21,026		27,636
Allowance for impairment	(1,187)		(1,187)
Prepaid expenses	5,792		889
Receivables under cession agreements, assumption of debt and regress	3,383		3,378
Initial value	4,007		4,161
Allowance for impairment	(624)		(783)
Financial assets, measured at fair value through profit or loss	2,235		2,235
Guarantees for participation in tender procedures	855		913
Advances granted, including	234		252
Initial value	304		322
Allowance for impairment	(70)		(70)
Tax refundable, incl.:	2		31
VAT	2		31
Litigations and writs	-		-
Initial value	10		10
Allowance for impairment	(10)		(10)
Other	89		855
Initial value	118		885
Allowance for impairment	(29)		(30)
	32,429		35,002

 

In accordance with the established policy, the Group provides its clients a credit period, after which an interest for delay is charged on the unpaid balance. An interest for delay is provided for in every particular contract. As at the end of every reporting period the Group carries out a detailed review and analysis of the significant due trade receivables and the assessed as uncollectible are impaired. All other unsecured trade receivables, usually due with more than 365 days, are impaired because the historical experience show that such receivables are non-recoverable.

 

The Group considers that unimpaired overdue receivables are collectible based on historical information about payments, guarantees received and a detailed analysis of the credit risk and collaterals of its customers.

 

 

18.  Cash and cash equivalents

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Cash in transit	1,725		2,075
Cash at banks	1,711		1,332
Cash on hand	88		79
Cash on statement of cash flows	3,524		3,486
Blocked cash	51		-
Cash on statement of financial position	3,575		3,486

 

Cash in transit comprises cash collected from fuel stations as at the end of the reporting period, but actually received in the bank accounts of the Group in the beginning of the next reporting period.

 

At the end of the reporting period, cash in the amount of BGN 51 thousand, blocked in enforcement court cases to which the Group is a party, were presented as blocked cash.

 

 

19.  Registered capital

 

The Group's registered capital is presented at its nominal value. The registered capital of the Group represents the registered capital of the Parent company Petrol AD.

 

As at June 30, 2020 and December 31, 2019 the shareholders in the Parent company are as follows:

 

Shareholder	June 30, 2020		December 31, 2019
Alfa Capital AD	28.85%		28.85%
Yulinor EOOD	23.11%		23.11%
Perfeto consulting EOOD	16.43%		16.43%
Correct Pharm EOOD	10.98%		10.98%
Trans Express Oil EOOD	9.86%		9.86%
Corporate Commercial Bank AD	5.51%		5.51%
VIP Properties EOOD	2.26%		2.26%
The Ministry of Economy of the Republic of Bulgaria	0.65%		0.65%
Other minority shareholders	2.35%		2.35%
	100.00%		100.00%

 

The Management of the Parent company has undertaken series of measures related to optimization of its capital adequacy. At several General Meetings of Shareholders (GMS) held in the period of 2016 - 2017 a decision for reverse-split procedure for merging 4 old shares with a nominal value of BGN 1 into 1 share with a nominal value of BGN 4 and consequent decrease of the capital of the Parent company in order to cover losses by decreasing the nominal value of the shares from BGN 4 to BGN 1, was voted. In March 2018, following a decision of the Lovech Regional Court, which repealed the refusal of the Commercial Register (CR) to register the decision voted on EGMS for merging 4 old shares with a nominal value of BGN 1 into 1 new share with a nominal value of BGN 4, the applied change was registered in CR resulting in registered capital of the Parent company of BGN 109 249 612, distributed in 27 312 403 shares with a nominal value of BGN 4 each. The change in the capital structure of the Parent company was registered also in Central Depositary AD. The submitted in April 2018 application for registration of the voted on EGMS decision for the second stage of the procedure of the Parent company's capital to be decreased by decreasing the nominal value of the shares from BGN 4 to BGN 1 in order to cover losses, was refused by the Commercial Register.

 

At EGMS of Petrol AD held on November 8, 2018 the decision to decrease the capital of the Parent company in order to cover losses by decreasing the nominal value of the shares from BGN 4 to BGN 1 was voted again. A refusal of the application for registration of the decision in CR was enacted, which was appealed by the Parent company within the statutory term. The minority shareholders disputed the decision of the EGMS and additionally to the refusal the application proceeding was postponed until the pronouncing of the Lovech Regional Court on the court proceedings, initiated on minority shareholders request. In March 2019 the Lovech Regional Court enacted a decision, which rules the CR to register the decrease of the capital after a resumption of the registration proceedings following the pronouncing on the legal proceedings initiated by the minority shareholders request.

 

In February 2019 was held a new EGMS, where the decision for reduction of capital was voted again and a decision for substitution of the deceased member of Supervisory Board Ivan Voynovski with Rumen Konstantinov was taken. A refusal on the application for registration of these circumstances in the file of the Parent company was enacted, which was appealed by the Parent company within the statutory term. In addition to the refusal, the registration proceeding was ceased on request of minority shareholders until the Lovech Regional Court rules on. In May 2019 the Lovech Regional Court enacted a decision, which repealed the enacted refusal and turn back the case to the Registry Agency for a registration of the application after a resumption of the ceased registration proceedings. At present, the court proceedings for repealing of the decisions of EGMS from February 2019 are pending.

The procedure for distribution of profits and coverage of losses is provided in the Commercial Act and the Articles of Association of the Parent company.

 

Loss per share

 

The loss per share is calculated by dividing the net loss for the period by the weighted average number of ordinary shares held during the reporting period.

 

			June 30, 2020		June 30, 2019
Weighted average number of shares (BGN'000)			27,312		27,312
Loss (BGN'000)			(5,902)		(7,007)
Loss per share (BGN)			(0.22)		(0.26)

 

 

20.  Loans and borrowings

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Non-current liabilities
Debenture loans	36,859		36,909
Loans from financial institutions	7,565		7,743
	44,424		44,652
Current liabilities
Debenture loans	1,174		2,210
Loans from financial institutions	721		524
Trade loans from unrelated parties	1		1
	1,896		2,735
	46,320		47,387

 

20.1.  Debenture loans

 

In October 2006, the Parent company issued 2,000 registered transferable bonds with fixed annual interest rate of 8.375% and emission value of 99.507% of the nominal, which is determined at EUR 50,000 per bond. The principal is due in one payment at the maturity date and the interest is paid once per year. At the general meetings of the bondholders conducted in October and December 2011, it was decided to extend the term of the issue until January 26, 2017. On 23 December 2016, a procedure for extension of the bond issue to 2022 and reduction of the interest rate in the range from 5.5% to 8% was successfully completed.

 

Following the prolongation of the debenture loan, the annual effective interest rate is 6.78%. The purpose of the bond issue is to provide funds for working capital, financing of investment projects and restructuring of the previous debt of the Group. The debenture loan liabilities are presented in the statement of financial position at amortized cost.

 

As at the date of preparation of these financial statements the nominal value of the debenture loan is EUR 18,659 thousand and the Group has finalized a procedure for rescheduling the maturity of the principal until 2027 and reducing the annual interest rate to 4.24%. (see also note 28. Events after the end of the reporting period).

 

20.2.  Loans from financial institutions

 

In July 2016, the Parent company entered into an investment loan agreement, prepaying the liabilities on finance lease contract from November 2015. Collateral of the loan is mortgage of property, acquired through finance lease and pledge of receivables. The term of the contract is May 2022 and the contracted interest rate is 3mEuribor+5.25%. As at June 30, 2020 the liabilities under the bank loan amounting to BGN 624 thousand current liabilities and BGN 565 thousand non-current liabilities. In April 2020 the Parent company has renegotiated the terms under the investment loan agreement, as the agreed interest rate on principal was reduced to 3mEuribor plus 3.5%, but not less than 3.5%.

 

In September 2018 the Parent company entered into a credit-overdraft agreement on current account in commercial bank, intended for working capital with maximum allowed amount of BGN 2,000 thousand and repayment period until January 31, 2019 and contracted interest rate as Savings-based Interest Rate (SIR) plus added amount of 6,1872 points, but cumulatively not less than 6.5% annually. The credit is secured with a special pledge of its goods in turnover, representing oil products and with a pledge of receivables on bank accounts. In December 2018, as a result of a signed annex to an agreement from 2016 for revolving credit line with the same bank, the Group negotiated an increase of the amount of the credit line of BGN 9,500 thousand with an additional amount of BGN 11,500 thousand, by which the total amount of credit line rose to BGN 21,000 thousand. The line is separated in total limit of BGN 13,500 for issuance of bank guarantees and BGN 7,500 for refinancing of the received credit-overdraft of BGN 2,000 thousand and the rest for working capital. The increased amount of the credit limit on the revolving credit line is covered additionally with establishment of mortgages and pledges of properties, plants and equipment with a carrying amount of BGN 6,543 thousand as at June 30, 2020. In June 2019 the loan was partially repaid and the limit for working capital decreased from BGN 7,500 thousand to BGN 7,000 thousand as at June 30, 2020. In January 2020 the Parent company renegotiated the terms of the used credit line granted to it by a commercial bank under a revolving credit line agreement dated September 21, 2016, with a credit limit of BGN 7,000 thousand and achieved a reduction of the annual compound SIR + 5,2802%, but not less than 5.5%.

 

20.3.  Factoring

 

In February 2019 the Group entered into an agreement with a commercial bank for factoring with special terms and without regress for transferring of preliminary approved receivables with a maximum period of the deferred payments up to 120 days from the date of invoice issuance with a payment in advance of 90% of the value of the transferred receivables including VAT. The commission for factoring services is 0.35% of the total value of the transferred invoices plus additional annual taxes. The interest for the amounts paid in advance is Base Deposit Index for Legal Entities + 1.95%, accrued daily and paid on monthly basis at the end of every calendar month. As of June 30, 2020, the Group has no exposure under this factoring agreement.

 

In December 2019 the Group entered into an agreement with a commercial bank for purchasing of trade receivables (standard factoring) with a total limit of the advanced payments up to BGN 430 thousand and interest rate based on savings in BGN increased by a mark up of 3.7767 points, but not less than 4% per annum on the amount of the advanced payment. The contract is secured by a pledge of receivables on opened bank accounts of the Group in the bank with a carrying amount of BGN 363 thousand as at June 30, 2020. As of June 30, 2020, the Group has no received payments in advance under this factoring agreement.

 

 

21.  Obligation for defined benefit retirement compensations

 

As at June 30,2020 and December 31, 2019, the Group accrued obligation for defined benefit retirement compensations amounting to BGN 656 thousand. The amount of the liability is determined based on an actuarial valuation, based on assumptions for mortality, disability, employment turnover, salary increases, etc. The present value of the liability is calculated using a discount factor of 0.68% and increase of the expected salary by 4%

 

The demographic assumptions are related to the likelihood individuals to leave the plan before retirement due to various reasons: withdrawal, staff reduction, illness, death, disability, etc. They are based on a statistical information about the population and are attached to the staff structure by gender and age at the time of the assessment.

 

 

22.  Trade and other payables

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Payables to suppliers	58,652		56,453
Tax payables, including	4,787		5,938
Excise duty and other taxes	4,513		5,418
VAT	274		520
Payables to personnel and social security funds	2,133		2,491
Advances received and deferred income	418		637
Payables to related parties	12		12
Other	893		1,023
	66,895		66,554

 

 

The Group accrues unused paid leave provision of employees in compliance with IAS 19 Employee Benefits. The movement of these provisions for the period is as follows:

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Balance at the beginning of the year	608		500
Accrued during the year	294		527
Utilised during the year	(322)		(419)
Balance at the end of the year, including:	580		608
Paid leaves	489		512
Social security on paid leaves	91		96

 

The balance at the end of the year is presented in the consolidated statement of financial position together with current payable to personnel.

 

23.  Current income tax

 

	June 30, 2020 BGN'000		December 31, 2019 BGN'000
Income tax payable at the beginning of the period	3		-
Corporate income tax accrued	-		3
Corporate income tax paid	3		-
Refundable corporate income tax at the end of the period	-		3

 

 

24.  Subsidiaries

 

The subsidiaries, included in the consolidation, over which the Group has control as of June 30, 2020 and December 31, 2019 are as follows:

 

Subsidiary	Main activity	Investment  at June 30 2020	Investment  at Dec. 31 2019
Varna Storage EOOD	Trade with petrol and petroleum products	100%	100%
Petrol Finance EOOD	Financial and accounting services	100%	100%
Elit Petrol -Lovech AD	Trade with petrol and petroleum products	100%	100%
Lozen Asset AD	Acquisition, management and exploitation of property	100%	100%
Petrol Properties EOOD	Trading movable and immovable property	100%	100%
Kremikovtsi Oil EOOD	Processing, import, export and trading with petroleum products	100%	100%
Shumen Storage EOOD	Processing, import, export and trading with petroleum products	100%	100%
Office Estate EOOD	Ownership and management of real estates	100%	100%
Svilengrad Oil EOOD	Processing, import, export and trading with petroleum products	100%	100%
Varna 2130 EOOD	Trade with petrol and petroleum products	100%	100%
Petrol Finances OOD	Financial and accounting services	99%	99%
Petrol Technologies OOD	IT services and consultancy	98,80%	98,80%

 

 

25.  Disclosure of transactions with related parties

 

Related parties that the Parent company controls and over which it exercises significant influence are disclosed in note 24.

 

The parent company (Controlling company) is Petrol AD.

 

In the first half of 2020 transactions with related parties have been not carried out.

 

The total amount of the accrued remunerations of the members of Management and Supervisory Board of the Parent company, included in the personnel expenses as at June 30, 2020 , amounted to BGN 511 thousand and unsettled liabilities of BGN 73 thousand.

 

 

26.  Capital management

 

In order to ensure the going concern functioning of the Group, the Management has undertaken series of purely procedural and business oriented measures, aimed to bring the capital of the Parent company in consistence with the requirements of Art. 252, par. 1, item 5 of the Commercial Act (CA) and overall improvement of the financial position of the Group.

 

The Management of the Group has undertaken series of measures in order to optimize the capital adequacy of the company. As a result of the several General Meetings of Shareholders held during 2016 and 2017 a decision for reverse split procedure for merging 4 old shares with a nominal of BGN 1 into 1 new share with nominal of BGN 4 and subsequent decrease of capital of the Parent company in order to cover losses by decreasing the nominal value of the shares from BGN 4 to BGN 1 was voted. In March 2018 following a decision of the Lovech Regional Court, which cancelled the refusal of the Commercial Register (CR) to register the decision taken on EGMS for merging of 4 old shares with BGN 1 nominal in 1 new share with BGN 4 nominal. The submitted change was registered in Commercial Register and the registered capital of the Parent company of BGN 109,249,612 was distributed in 27,312,403 shares with nominal of BGN 4 each. The change in capital structure was registered also in the register of Central Depository AD. The Commercial Register enacted a refusal on the submitted in April 2018 application for registration of the decision of EGMS for the second stage of the procedure reducing the nominal value of the shares from BGN 4 to BGN 1 in order to cover losses.

 

At EGSM of Petrol AD held on November 8, 2018 the decision for reduction of capital of the Parent company in order to cover losses by decreasing the nominal value of the shares from BGN 4 to BGN 1 was voted again. A refusal was given on the application for registration of the decision in CR, which was appealed by the Group within the statutory term. The minority shareholders disputed the decision of the EGMS and additionally to the refusal, the application proceedings was postponed until the pronouncing of the Lovech Regional Court on the court proceedings, initiated on minority shareholders request. In March 2019, the Lovech Regional Court ruled a decision instructing Commercial Register to reflect the reduction of capital after the resumption of the registration proceedings and ruling on the cases initiated at the request of the minority shareholders.

 

The decision for reduction of the capital was voted again on a new EGMS held in February 2019. On the same EGMS was also taken a decision for replacement of the deceased member of the Supervisory Board Ivan Voynovski with Rumen Konstantinov. The application for registration of these circumstances in the account of the Parent company was refused, which was disputed within the legal term by the Parent company.

 

In addition to the refusal the registration proceedings was postponed by a request of minority shareholders until the pronouncing of the Lovech Regional Court. In May 2019 the Lovech Regional Court enacted a decision, which repealed the enacted refusal and turn back the case to the Registry Agency for a registration of the application after a resumption of the ceased registration proceedings. At present, the court proceedings for repealing of the decisions of EGMS from February 2019 are pending.

 

Next capital adequacy measure, which the Group has taken is a change in accounting policy in relation to non-current tangible assets - property, plant and equipment of the policy applied in its financial statements until 2019 including the cost model, with the application from the beginning of 2020 of the other applicable model - the revaluation model, which the Management considers to reflect more objectively the value of the held non-current tangible and intangible assets.

To carry out its business activity the Group needs free capital to provide the necessary working capital, to pay its obligations on timely manner and to follow its investment intentions. Major sources of liquidity are cash and its equivalents, intra-group cash flows, long-term and short-term loans, the decrease of receivables collection period and extension of the liabilities paying period.

 

The Group's Management expectations are that in the coming years as a result of a growing competition mainly in retail market, part of the small independent players would be forced out gradually of fuel business. At the same time, the expectations in terms of the levels of trade margins, in particular on the retail market, are the margins to stabilize around the average European levels.

 

At the end of 2019, a new coronavirus was identified in China. Due to the fast widespread of the virus across the world at the beginning of 2020, the World Health Organization declared a global pandemic. On March 13, 2020 the Parliament declared a state of emergency on request of the Government of Republic of Bulgaria and on March 24, 2020 the Law on Measures and Actions during a State of Emergency became effective. In order to restrict the widespread of coronavirus infection, an Order of the Health Minister was issued for the introduction of anti-epidemic measures, which directly affect the business activity of the Group. Part of the measures include extension and interruption of the administrative deadlines, extension of the of administrative acts, suspension of the procedural court terms and the statute of limitations, changes in the labor legislation, referring to new working hours, suspension of work and / or reduction of working hours and use of leave, etc. The pandemic causes a significant reduction in economic activity in the country and raises significant uncertainty about future processes in macroeconomics in 2020 and beyond.

 

The Group's Management monitors the emergence of risks and negative consequences in the outcome of the pandemic with Covid-19, currently assessing the possible effects on the assets, liabilities and activities of the Group, striving to comply with contractual commitments, despite the uncertainties and force majeure circumstances. In view of the introduced anti-epidemic measures and restrictions in the pandemic, which cause a significant reduction in economic activity and creates significant uncertainty about future business processes, there is a real risk of a decline in sales of the Group. However, Management believes that it will be able to successfully bring the Group out of the state of emergency in which it is placed

 

The plans for the future development of the company are closely related and depend to a greater extent to the stated expectations for changes in the market environment. The Management continues to follow the program outlined and started in the beginning of 2014 for restructuring the activities of Petrol Group, aiming to concentrate the efforts to optimize and develop the core business - wholesale and retail trading with fuels. With the aim to improve the financial position, the Management continues to analyze actively all expenses and to look for hidden reserves for optimization.

 

In the coming years the results of the Group will also depend on the possibilities to carry out the investments and the successful delivering of new projects. The investments of the Group will be focused predominantly on the development of new sites and increasing the sales and market share of Petrol AD, mainly through transformation of the trade sites managed by the Parent - company into modern places for complex customer service.

 

Following the strategy of expanding the market share in retail market, the Group plans to attract new sites under Petrol brand through the franchise program.

 

In the next year the Management of the Group will direct its effort towards conducting an active marketing campaign. It is provided marketing activities - games, promotions and other, supported by enough media appearances to increase the sales of fuels. The Management will continue to develop its card system and plans to create a loyalty clients system.

 

The Group's Management activities are directed to validation of the principles and traditions of good corporate governance, increasing the trust of the interested parties, namely shareholders, investors and counterparties, and to disclosure of timely and precise information in accordance with the legal requirements.

 

 

27.  Contingent liabilities

 

As at June 30, 2020 the Group has contingent liabilities, including issued mortgages and pledges of property, plant and equipment and non-current assets held for sale, which serve as a collateral for bank loans granted to the Group and unrelated parties and credit limits for issuance of bank guarantees with total carrying amount of BGN 21,676 thousand. The Group is a joint co-debtor under loan agreement of unrelated supplier, including limit for overdraft and limit for stand-by credit for issuance of bank guarantees in favour of Customs Agency. The total amount of the utilized funds and issued bank guarantees of all borrower's exposures to the Bank shall not exceed BGN 45,000 thousand. In relation to this credit agreement, the Group has established a special pledge on its cash in the bank account opened in the bank-creditor with total amount of BGN 51 thousand as at June 30, 2020 and a special pledge on receivables from contractors for BGN 4,000 thousand average monthly turnover.

 

The Group bears a joint obligation according to a contract for debt from January 2017 on an obligation of a subsidiary until February 2018 for BGN 2,346 thousand as at June 30, 2020.

 

Under a bank agreement for revolving credit line signed in 2016, bank guarantees were issued for a total amount of BGN 9,420 thousand as at June 30, 2020, including BGN 6,950 thousand in favor of third parties - Group's suppliers, BGN 1,055 thousand in favor of National Revenue Agency, for issuance of appealed by the Parent company amended assessment and BGN 1,415 thousand to secure own liabilities related to contracts under the Public Procurement Act. The bank agreement is secured by mortgages of property, pledge of plants and equipment, pledge of all receivables on bank accounts of the Parent company and a subsidiary. In July 2017 the credit limit under the revolving credit line was increased from BGN 8,500 thousand to BGN 9,500 thousand. Assets amounted to BGN 1,500 thousand, owned by a subsidiary, additionally secured the credit limit. With an annex from December 2018 the limit is increased to BGN 21,000 thousand and is additionally secured with mortgages and pledge of property, plants and equipment, and special pledge of goods in turnover, namely petroleum products. In June 2019, the credit limit for working capital granted under this credit line was partially repaid as its amount decreased from BGN 7,500 thousand to BGN 7,000 thousand.

 

As a collateral of an investment loan signed in July 2016, a mortgage of property, acquired through the investment loan and a pledge of receivables, arising from opened bank accounts of the Parent company to the amount of the outstanding balance of the loan, which as at the June 30, 2020 amounting to BGN 1,179 thousand.

 

In relation to a signed in 2015 guarantee contract for obligations of another subsidiary, arising of a cession contract with outstanding book value as at June 30, 2020 of BGN 245 thousand, the Court ruled a final decision on this pending litigation. The Court assumed that the Parent company is responsible as a guarantor for the obligations of the subsidiary under the cession agreement. The Court of Appeal has entirely annulled the decision of the first instance court and admitted the receivable of the Parent company under the guarantee contract jointly with the other related party. The decision of the appellate court was appealed by the Company before the Supreme Court of Cassation, but was not allowed to appeal. The Group intends to file a claim to establish the non-existence of these receivables. Collateral for the future claim against the provision of a guarantee in the amount of BGN 25 thousand to the account of the court was admitted in favor of the Group, as a result of which the enforcement proceedings initiated against the Group for these claims were suspended. The funds given as collateral under Art. 180 and Art. 181 of the CPA in the amount of BGN 245 thousand in the case initiated against the Group in 2015, together with the amount of BGN 93 thousand, were collected by the bailiff in the course of the enforcement proceedings initiated against the Group. However, they have not been distributed due to the suspension of the enforcement case, based on the security of a future claim provided in favor of the Group and remain blocked on the account of the bailiff until the final conclusion of the litigation.

 

In the previous reporting periods companies from the Group have entered into the debt under two loan agreements of a subsidiary with a bank-creditor for USD 15,000 thousand and USD 20,000 thousand, respectively. In 2015 the bank -creditor acquired court orders for immediate execution and receiving orders against the subsidiaries - joint debtors. In relation to the complains filed by the subsidiaries, the competent court has revoked the immediate enforcement orders and has invalidated the receiving orders. In October and December 2015 the creditor has filed claims under Art. 422 of Civil Procedure Code (CPC) against the subsidiaries for the existence of the receivables under each loan agreement. The court proceedings of the creditor are still pending.

 

In December 2016 the first instance court decreed a decision (the Decision) which admit for established that the bank has a receivable amounted to USD 15,527 thousand from the subsidiaries - joint debtors, arising from a signed loan agreement for USD 15,000 thousand. With the same decision the court has ordered the joint-debtors to pay BGN 411 thousand to the bank - creditor for legal advisory fees and court dispute expenses and BGN 538 thousand state fee in favor of the judiciary state for the ordered proceedings and BGN 538 thousand state fee for claim proceedings. In January 2017, the co-debtors have filed in time appeals against the court decision, because of that the decision did not come into force. As at the date of the preparation of these explanatory notes, the dispute is pending in the appeal court. The Group's Management considers that there are grounded chances the Decision to be entirely repealed.

 

As at the date of the preparation of these explanatory notes, the filed proceedings against the subsidiaries - joint debtors for estimation of the bank receivables due to the loan agreement for USD 20,000 thousand is pending before the first-instance court. The Management expects favorable decision by the competent court. In 2018 the Parent company sold its interest in one of co-debtor subsidiaries and the potential risk for the Group is reduced to the court proceedings against the second subsidiary.

 

A creditor of a subsidiary (until December 2015) unreasonably claimed in court the responsibility of the Parent company under a contract of guarantee for liabilities arising from a contract for a framework credit limit as a result of that the bank accounts of the Parent company amounting to USD 29,983 thousand were garnished. This claim was disputed in court by Petrol AD because the liability as guarantor has not occurred and / or extinguished pursuant to Art. 147, par. 2 of the LOC. At the time of conclusion of the guarantee deadline of the arrangements between the lender and subsidiary contractual framework for credit limit was July 1, 2014. The term of the framework credit limit was extended without the consent of the customer, therefore the responsibility of the latter has fallen by six months after initially agreed period, during which the creditor has brought an action against the principal debtor. The term of Art. 147, par. 1 of the LOC is final and upon its expiration the company's guarantee has been terminated, so the objection of the Parent company was granted by the court and imposed liens on bank accounts lifted.

 

After the writ of execution, pursuant to order proceedings, was canceled on which were imposed liens on bank accounts of the Parent company, the creditor has initiated legal claim proceedings under Art. 422 of the CPC to establish the same claims against the subsidiary (until December 2015) and the guarantor Petrol AD. In these proceedings the objections are repeated, that liability as guarantor has not occurred and / or extinguished pursuant to Art. 147, par. 2 of the LOC, and therefore the Management expects that the claim of the creditor against the Parent company will be dismissed permanently by a court decision on those cases. At present, the case is suspended due to the existence of a preliminary rulling, which is important for the correct resolution of the case.

 

In December 2019, the Parent company entered into an Agreement with a commercial bank for the purchase of trade receivables (standard factoring) with a total advance limit of up to BGN 430 thousand and an interest rate based on savings for BGN, increased by a mark-up of 3.7767 points, but not less than 4% per annum on the amount of the granted advance. The contract is secured by a pledge of receivables on opened bank accounts of the Parent Company with a book value as at June 30, 2020 at the amount of BGN 2 thousand.

 

The Group is a joint and several debtor and avalist of a promissory note under a Loan Agreement - overdraft from a financial institution, granted to an unrelated person - a major fuel supplier with a total amount of BGN 12,000 thousand.

 

 

28.  Events after the reporting date

 

From the beginning of 2019, the Bulgarian legislation has in force the Law on the Administrative Regulation of Economic Activities Related to Oil and Petroleum Products. The operation of the law directly concerns the main activity of the Group. In September 2020 the Parent company was entered in the register to the Ordinance on the terms and conditions for keeping a register of persons engaged in economic activities related to oil and petroleum products for economic activity wholesale and has issued a bank guarantee in favor of the Ministry of Economy in the amount of BGN 500 thousand. As of the date of publication of these financial statements the registration procedure of the company for retail trade in oil and oil products is at the stage of processing by the Ministry of Economy of the documentation provided by the Parent company, as the Parent company expects to receive the registration act in a short time.

 

In September 2020, the Group successfully completed a procedure for renegotiating the terms of the debenture loan granted to it in 2006. The maturity of the principal of the debenture loan is rescheduled until January 2027, the agreed interest rate is reduced to 4.24% per annum, and the periodicity of interest (coupon) payments is every six months - in January and in July of each month.