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Ettevõte UPP Olaines OÜ
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Avaldamise aeg 14 juuni 2019 15:00:31 +0300
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UPPOlaines-10001976691-en.pdf
UPPOlaines-10001976693-et.pdf
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Pealkiri UPP Olaines OÜ Audited Annual Report 2018
Tekst
MANAGEMENT REPORT

General information

UPP  Olaines OÜ  (hereafter 'the  Company') was  established for  the purpose of
funding,  acquiring and managing the real estate investment of Olaines Logistics
Park:  (buildings  and  land)  located  at  "Sharlotes",  Olaines county, Olaines
parish,  Latvia, cadastre number 8080 003 0029, registered  in the Land Register
compartment No.5439 of the city of Olaine parish. The Company was established on
24.08.2017 and  had no economic activity  until 15.12.2017, when it acquired the
cold storage warehouse Olaines Logistics Park.

The  business performance is not affected by seasonal factors. The activities of
the Company have no environmental or social impact.

As the Company has been established solely for the purpose of funding, acquiring
and managing the property, no strategic changes in the business are planned.

The  management board is aware of no trends, uncertainties, demands, commitments
or  events that are reasonably likely to have a material effect on the Company's
prospects  for  the  period  after  the  reporting  period  of  these  financial
statements outside the course of its regular business activities.

UPP Olaines OÜ is operating based on going concern.

Management commentary for the period 24.08.2017 - 31.12.2018

The  first  and  successful  reporting  period  of  the  Group was marked by two
important  events: acquisition of the investment property Olaines Logistics Park
and  the  successful  listing  of  UPP  Olaines  OÜ bonds on Nasdaq Tallinn Bond
List.

UPP  Olaines OÜ  completed the  acquisition of  the investment  property Olaines
Logistics  Park on 15.12.2017. The property  was chosen due to  its fit with the
investment  theme  of  United  Partners  Property  OÜ, the parent company of UPP
Olaines  OÜ: logistics real estate in  an attractive location coupled with long-
term lease contracts with lessees who have a leading or dominant position within
their sector.

To  finance  the  acquisition  of  the  property,  the  Company  issued  secured
subordinated  bonds in the  total nominal value  of 6.215 million euros. After a
non-public  offering  to  Baltic  institutional  investors  and  high-net  worth
individuals,  the  bonds  were  successfully  listed  and admitted to trading on
Nasdaq Tallinn Bond List on 29.11.2018.

Additionally,  on 13.09.2018, a  meeting of  the shareholders  and board  of UPP
Olaines  OÜ  was  held  where  it  was  decided to change the composition of the
management  and supervisory board of UPP  Olaines OÜ and its subsidiary, Olaines
Logistics  SIA. The previous supervisory board member, Marko Tali, was appointed
as  the chairman of the management board of UPP Olaines OÜ and Olaines Logistics
SIA,  while both of the previous members  of the management board, Hallar Loogma
and  Kevin  Soon,  were  discharged  from  their  positions.  Hallar  Loogma was
appointed on the supervisory board of the Company. The changes in the management
and supervisory board of UPP Olaines OÜ were completed by 05.10.2018.

Marko Tali has been the head of investments in United Partners Investments OÜ,
the direct investment arm of United Partners Group OÜ. These changes were part
of the efforts to streamline the management of United Partners Group's
investments.

Financial overview

The  consolidated net rental  income for the  period 24.08.2017 - 31.12.2018 was
2,607,869 EUR. During the same period the company generated 2,651,520 EUR in net
operating  profit and  967,219 EUR in  net profit.  Due to  the fact the company
acquired  the investment company  Olaines Logistics Parks  and this is the first
audited  consolidated  report,  the  financial  results  can  not be compared to
previous audited annual reports.

The  administrative expenses amounted to 221,480 EUR which accounted for 8.5% of
the net rental income. The administrative expenses include expenses with one-off
nature,  such as remuneration of transaction  costs to the United Partners group
company  in the amount of 100,000 EUR  under consulting service expense, and the
cost  of escrow account, establishment of mortgage and the loan disbursement fee
in the total amount of 32,627 EUR under banking services expense.

The  company  used  independent  appraisers  to  evaluate  the the fair value of
Olaines  Logistics  Park  investment  property  and  during the reporting period
gained 362,000 EUR from revaluation of investment property.

The  majority of  the expense  under 'Other  income /  (cost)' in  the amount of
96,869 EUR  occurred during 2016 and 2017 when UPP  Olaines OÜ was not yet owner
of the investment company Olaines Logistics Parks SIA. The expense is of one-off
nature and was mainly caused by the deferred corporate income tax liability that
was  accumulated on the balance sheets in anticipation of changes in calculation
and  payment procedures of CIT that came  with the new CIT legislation in Latvia
in 2018.

As  at 31.12.2018, the company's total assets  were in the amount of 31,489,267
EUR,  including fair value of investment  property, which accounted for 97.7% of
the  total assets. As at 31.12.2018 the company's  net debt was in the amount of
26,181,642 EUR.  Net debt is  calculated by the  company's total borrowings less
cash  and  cash  equivalents,  and  the  subordinated loan granted by the parent
company United Partners Property OÜ.

No  other significant events occurred  in the period 24.08.2017 - 31.12.2018 and
all  regular operations of the premise  are running smoothly, including duly and
timely collection of rental and utilities payments from the tenants.

As of the end of 2018, there is no vacancy in the premises.

Compliance with bond terms

According  to the Terms and Conditions of UPP Olaines OÜ Subordinated Note Issue
section  3.5.3 and 3.5.4, the Management confirms  that the Group's debt service
coverage  ratio on consolidated level  is greater or equal  than 1.1 for the the
period  24.08.2017 -  31.12.2018 and  that  there  has  been  no occurence of an
Extraordinary Early Redemption Event in 10.11.2017 - 31.12.2018.

/Signed digitally/

Marko Tali

Chairman and Member of the Management Board of UPP Olaines OÜ

14.06.2019, Tallinn

Management board and supervisory board

The  management board of UPP Olaines OÜ has one member: Marko Tali, the chairman
of the management board.

The  supervisory board of UPP Olaines OÜ  has three members: Mart Tooming, Tarmo
Rooteman, Hallar Loogma.

No  remuneration or  other benefits  have been  allotted to  the members  of the
management board and supervisory board.

There  are no employees in the Company besides the members of the management and
supervisory board.


Key indicators of financial performance and position for period 24.08.2017 -
31.12.2018

--------------------------------------------------
  (in EUR)                24.08.2017 - 31.12.2018
--------------------------------------------------
  Net rental income                     2,607,869

  Operating profit                      2,651,520

  Profit for the period                   967,219
--------------------------------------------------


-------------------------------------------------------------------------
  (in EUR)                                       31.12.2018   24.08.2017
-------------------------------------------------------------------------
  Investment property                            30,762,000            0

  Interest-bearing loans                         29,656,633            0

  Interest-bearing loans less shareholder loan   26,608,333            0


-------------------------------------------------------------------------------
                                                        24.08.2017 - 31.12.2018
-------------------------------------------------------------------------------
 Net profit margin, % (Net profit / Net rental income)                    37.1%

 ROA (Net profit / Average total assets)                                   6.1%

 DSCR (Operating profit / Loan principal and interest
 payments on interest-bearing loans less shareholder
 loan principal and interest payments)                                      1.3


CONSOLIDATED FINANCIAL STATEMENTS OF UPP OLAINES OÜ

Consolidated statement of comprehensive income

-------------------------------------------------------------------------------
 (in EUR)                                          Note 24.08.2017 - 31.12.2018
-------------------------------------------------------------------------------
 Net rental income                                  6                 2,607,869
-------------------------------------------------------------------------------
 Net rental income                                                    2,607,869
-------------------------------------------------------------------------------


 General and administrative expenses                7                 (221,480)

 Gain / (loss) from revaluation of investment
 property                                           12                  362,000

 Other income / (cost)                                                 (96,869)
-------------------------------------------------------------------------------
 Operating profit                                                     2,651,520
-------------------------------------------------------------------------------


 Financial income / (cost)                          8               (1,720,477)
-------------------------------------------------------------------------------
 Profit before income tax                                               931,043
-------------------------------------------------------------------------------
 Income tax                                         9                    36,176

 Profit for the period                                                  967,219


-------------------------------------------------------------------------------
 Total comprehensive income for the period                              967,219
-------------------------------------------------------------------------------

The notes on pages 12 - 36 are an integral part of the financial statements.


Consolidated statement of financial position

-----------------------------------------------------------------
  (in EUR)                        Note   31.12.2018   24.08.2017
-----------------------------------------------------------------
  Cash and cash equivalents        10       426,691        2,500

  Trade and other receivables      11       300,576            0
-----------------------------------------------------------------
  Total current assets                      727,267        2,500



  Investment property              12    30,762,000            0
-----------------------------------------------------------------
  Total non-current assets               30,762,000            0

  TOTAL ASSETS                           31,489,267        2,500



  Trade and other payables         13       446,036            0

  Financial derivatives            16       416,879            0

  Loans and borrowings             15     1,064,004            0
-----------------------------------------------------------------
  Total current liabilities               1,926,919            0



  Loans and borrowings             15    28,592,629            0
-----------------------------------------------------------------
  Total non-current liabilities          28,592,629            0

  TOTAL LIABILITIES                      30,519,548            0



  Share capital                    14         2,500        2,500

  Retained earnings                         967,219            0
-----------------------------------------------------------------
  TOTAL EQUITY                              969,719        2,500



  TOTAL EQUITY AND LIABILITIES           31,489,267        2,500
-----------------------------------------------------------------

The notes on pages 12 - 36 are an integral part of the financial statements.


Siim Sild

Director

+372 5626 0107

siim.sild@unitedpartners.ee