Final Results

RNS Number : 1068E

Dolphin Capital Investors Limited

04 May 2017

4 May 2017

DOLPHIN CAPITAL INVESTORS LIMITED

("DCI" or "Dolphin" or the "Company" and together with its subsidiaries the "Group")

Annual Financial Results for the year ended 31 December 2016 and Trading Update

Dolphin Capital, an investor in high-end residential resorts in the eastern Mediterranean, announces results for the year ended 31 December 2016 and trading update on the first quarter of the current financial year.

Financial Highlights:

· Gross Assets of €466 million (2015: €911 million)

· Total Group Net Asset Value ("NAV") of €265 million and €234 million before and after Deferred Tax Liabilities ("DTL") respectively. This represents a decrease of €255 million and €248 million (49% and 51.4%) respectively, against the year-end 2015 figures.

· NAV reduction principally due to:

o A reduction in the carrying value of DCI's shareholding in Aristo by a total of €144 million resulting from: the €35 million impact of the debt restructuring agreement reached with Bank of Cyprus in June 2016; operating losses; and, a further €109 million write-down on sale based on the €45 million sales price which had been agreed with Mr. Aristodemou but which has now been terminated by the Company effective 3 May 2017 due to Mr. Aristodemou's failure to settle the deferred payments as they became due. The Company received €1.8 million from this transaction and has retained a 47.9% stake in Aristo.

o The loss from the sale of Playa Grande of €25 million.

o A writedown in the carrying value of Pearl Island by €25 million reflecting the post year end disposal of DCI's 60% shareholding for €27 million.

o Year-end valuation writedowns and impairment charges of €21 million on assets retained.

o Other operational, corporate, finance and management expenses.

· Sterling NAV per share as at 31 December 2016 stood at 25p before DTL and 22p after DTL, a 40.8% and 43.6% decrease before and after DTL respectively compared to 31 December 2015. The decrease, mainly reflecting the factors mentioned above, was partially offset by a 16.2% appreciation of the Euro versus the Sterling.

· Total Debt of €101 million (2015: €232 million) with a Group total debt to gross asset ratio of 22% (2015: 26%). Following the completion of the Playa Grande project disposal on 8 December 2016 which included the retirement of all of the Company's €50 million and US$9.17 million 2018 convertible bonds, and the repayment of the 2016 convertible bonds in 31 March 2016, DCI itself does not have any further recourse loans or guarantees and the remaining Group debt is at project level on a non-recourse basis.

· Total Group cash as of 31 March €17.8 million (31 December 2016: €4.7 million).

Divestments:

· New Asset Strategy adopted by the Board:

o shareholder approval on 19 December 2016

o all remaining assets to be sold in a controlled, orderly and timely manner in order to realise their value

o target is to dispose of all assets by 31 December 2019

· Completion of sale of the Company's 100% interest in the Playa Grande Golf and Resort project, including the Amanera resort in the Dominican Republic, for a consideration of €64 million, comprising cash of €4.6 million and debt repayment of €59.4 million (equating to a €140 million enterprise value) on 15 November 2016.

· Following the year end, completion of the sale of the Company's 60% interest in Pearl Island, Panama Republic for a cash consideration of €27 million (equating to a €63 million enterprise value).

Operations:

· Amanzoe performance improved by increasing occupancy to 62% (2015: 57%) and generating an average daily rate ("ADR") of €1,242 (2015: €1,229). Two residential units were sold, bringing the total number of units sold in the project to 14.

· Residential masterplan filed allowing the sale of freehold units at Kilada Hills. Founders Program launched, targeting the sale of 40 Kilada Hills Founders' Memberships, each including a golf course lot and golf course membership.

· Discussions progressing with a renowned international resort and real estate investor for a joint venture transaction involving a €20 million equity investment to fund the construction of the Kea resort, in exchange for a 50% shareholding in the project.

· Additional sales agreements signed for the sale of one Seafront Villa in Kilada Hills and for three residences at La Vanta, Turkey.

· Residential zoning in Sitia Bay achieved which provides legal entitlement for the sale of residential lots independently from the already permitted resort development.

Commenting, Andrew Coppel, the chairman of Dolphin's Board of Directors, said:

"Following the adoption of the New Asset Strategy, we are focussed on maximising value for shareholders and our objective is to have disposed of all assets no later than 31 December 2019. Whilst market conditions for disposals in our geographic areas of operation remain challenging, we are encouraged by the disposals to date."

Miltos Kambourides, Founder of Dolphin and Managing Partner of DCP, said:

"We are pleased with the successful disposal of our assets in the Carribean and Central America region. The momentum of the continuously improving performance of Amanzoe, if combined with a positive shift in the Greek political and economic environment, should allow for further asset sales."

For further information, please contact:

Dolphin Capital Investors

Andrew M. Coppel, CBE

+44 (0) 7785 577023

Dolphin Capital Partners

Miltos E. Kambourides

miltos@dolphincp.com

Panmure Gordon

(Broker)

Richard Gray / Andrew Potts

+44 (0) 20 7886 2500

Grant Thornton UK LLP

(Nominated Adviser)

Philip Secrett

+44 (0) 20 7383 5100

Instinctif

(PR Communications Adviser)

Mark Garraway

+44 20 7457 2020

A. Chairman's Statement

The year under review was a landmark year for the Company. We achieved a successful full divestment from our assets in the Caribbean and Central American region, and received approval to implement the New Asset Strategy which is designed to maximise returns to shareholders.

The key components of the New Asset Strategy are the orderly and controlled disposal of the Company's asset portfolio by no later than 31 December 2019, the implementation of a revised remuneration agreement with DCP aimed at incentivising the management towards the timely execution of sales at the maximum possible pricing, and the adoption of a distribution policy directed to maximising the return of disposal proceeds to shareholders and not building significant cash balances at the Company level, except for short-term working capital purposes.

Although shareholders approved the New Asset Strategy only in December 2016, the Company had already been making significant advances with the divestment of certain key assets, including the Playa Grande Golf and Resort and its 60% interest in Pearl Island. Whilst we had also agreed to sell our 49.75% shareholding in Aristo, with the cash consideration payable on an instalment basis over three years, we have now terminated this agreement as the deferred payments were not settled in accordance with its terms. We have received €1.8 million from this transaction and have therefore retained a 47.9% stake in Aristo. The Board and the Investment Manager are considering the options to realise value from the Aristo holding.

During 2016 the Company repaid the total Euro and US Dollar 2018 Convertible Bonds, as well as the remaining 2016 Convertible Bonds, with an aggregate face value of €75 million, through existing cash balances and on disposal of the Playa Grande project. In addition, as a result of the Playa Grande disposal, all of the Company's guarantees with respect to the construction project loan, and the mezzanine financing facility provided by Melody Capital, have been released. Consequently, at the end of 2016, Dolphin had no debt at the Company level and no corporate or other guarantees on project loans.

As at 31 December 2016, the audited NAV before DTL was €265 million, representing a 49% decrease from 31 December 2015. This was mainly due to the writedowns on disposal of Aristo, Playa Grande and Pearl Island, as they were sold at prices below their respective carrying values. The NAV per share before DTL in Euro terms was €0.29 compared to €0.57 at 31 December 2015.

The Company continues to market specific assets to select groups of potential investors. In parallel, we are undertaking targeted development initiatives for two of our more advanced projects. For Kea Resort, we are in JV funding discussions with a reputable international investor in order to secure the third party equity financing required for the project's development, and in relation to Kilada Hills by bringing to the market the Founders' Program which is targeted to facilitate the development funding of the Kilada Hills project's golf course and related infrastructure.

Despite the divestments to date, taking into consideration Dolphin's liabilities and working capital requirements, no distribution to Shareholders is proposed at this time but this will be kept under close review following further disposals.

The Board is encouraged by the continued Shareholder support for its initiatives and the recent disposals of two key assets. We remain focused on the execution of the Company's New Asset Strategy working closely with the Investment Manager in order to enable the Company to dispose of its investment portfolio within the divestment period set and deliver cash distributions to Shareholders.

Andrew M. Coppel CBE

Chairman

Dolphin Capital Investors

4 May 2017

B. Investment Manager's Report

B.1. Business Overview

During 2016, in parallel to managing the overall DCI business including the hotel operations in Amanzoe and Nikki Beach in Greece and Amanera in the Dominican Republic, we progressed the entitlement status and development potential of the project portfolio with notable permitting progress achieved at Kilada Hills Golf Resort and Sitia Bay.

In parallel, we pursued disposal opportunities to realise the portfolio's value and arranged, agreed and executed two major divestments as follows:

- the entire Playa Grande Golf and Resort project to a joint venture comprising an affiliate of Third Point LLC, an affiliate of Discovery Land Company and others, for a €64 million consideration comprising principally repayment of outstanding debt (equating to an enterprise value of €140 million); and,

- the 60% interest in Pearl Island to Grivalia Hospitality S.A. for a €27 million cash consideration (equating to a €63 million enterprise value).

The Company also agreed the sale of its 49.75% stake in Aristo Developers Ltd to Mr. Theodoros Aristodemou and has received to date €1.8 million of the total cash consideration of €45 million due in instalments before the end of 2019. However, as the remaining deferred payments have not been received in line with the provisions of the Agreement, the Company terminated on 3 May 2017 the share purchase agreement and has therefore retained a 47.9% stake in Aristo. The Company and the Investment Manager are considering options to realise value from the Aristo stake.

Working closely with the Board, we formulated the New Asset Strategy and agreed a revised Investment Management Agreement that further aligns the Investment Manager with shareholders to execute the Company's New Asset Strategy. The execution of the two significant asset disposals over the past 12 months provided additional cash to Dolphin and eliminated all debts at the Company level.

Separately, we are actively pursuing discussions regarding funding of the development of the Kea Resort project through a joint venture transaction with an international resort operator and investor, which if concluded will provide the equity funding required for the development of the project. We have also launched the sale of the Founders Program at Kilada Hills Golf resort that will facilitate the funding of the development of the project's golf course and infrastructure from third party sources. These development initiatives are structured in a way to externally fund the projects' initial phase of the development without requiring additional DCI funding and with the aim of enhancing the underlying projects' value and disposal potential within the divestment period set out by our New Asset Strategy.

B.2. Continuation Vote and New Asset Strategy

The Company was admitted to trading on AIM on 8 December 2005 as a newly incorporated, BVI registered, closed-end investment company. At the time of admission, the Directors of the Company undertook that shortly before the tenth anniversary of the initial admission of the Company's share capital to trading on AIM (8 December 2015), the Board would convene a Shareholders' meeting at which a resolution would be proposed to determine the future of the Company. The timing for the convocation of the Shareholders' meeting to assess the life of the Company was then considered in the context of the Company's June 2015 capital raise, when the Board committed to convene and hold an Extraordinary General Meeting of Shareholders ("EGM") prior to 31 December 2016 at which an ordinary resolution for the continuation of the Company would be proposed.

The Board, following this commitment and working together with the Company's Investment Manager, proposed a New Asset Strategy which was put to Shareholders at the EGM on 19 December 2016. The New Asset Strategy, as further detailed in the circular issued on 2 December 2016, comprised changes to the Company's investment policy, distribution policy and the remuneration structure for the Investment Manager.

More specifically, the New Asset Strategy was designed to effect the orderly sale of both the Company's Core Projects and the Non-Core Assets in a controlled and timely manner in order to realise their value by 31 December 2019. Consequently, the distinction between Core Projects and Non-Core Assets was no longer considered relevant as the Board and DCP, working with the Company's advisers, explored the best manner in which the orderly sale of the entire Company's portfolio could be achieved on an asset by asset basis, in the light of prevailing market conditions and circumstances. The allocation of any additional capital investment into any of the Company's projects is targeted to be sourced from joint venture agreements with third party capital providers and project level debt, and with the sole objective of enhancing the respective asset's realisation potential and value within the divestment period of 31 December 2019.

With respect to the distribution policy, the Board has indicated that it intends to distribute to Shareholders at least 50% of the net proceeds of asset disposals, approximately three months after the completion of each disposal, subject to consideration of the Company's existing liabilities (including any borrowings) and general working capital requirements.

B.3. Portfolio Review

B.3.1. Projects

· Amanzoe, Greece (www.amanzoe.com)

- Amanzoe commenced operations for the 2016 season on 1 April 2016, as scheduled, with seven Villas in the rental programme, and ended on 1 November 2016. The 2016 Amanzoe hotel performance continued to improve compared to 2015. Occupancy for the season was 62% (2015: 57%), representing a five percentage points increase compared to 2015, with an ADR of €1,242 (2015: €1,229), while the NOI improved more than doubled on a year-on-year basis.

- Amanzoe continues to receive outstanding reviews and publicity. The hotel opened on 1 April 2017 for the current season with hotel occupancy and rates higher than last year.

- During 2016, two additional Aman Villas sales were completed bringing the total number of sold units in Amanzoe to 14. In an effort to diversify our Villa offerings and increase the pace of sales, we have introduced for the 2017 season a limited number of 2-bedroom Amanzoe Villas, which appear to be in high demand in the rental market. The enhanced relationship with Sotheby's Greece is expected to further boost the demand in Amanzoe villas.

· Amanera, Dominican Republic (www.amanera.com)

- The Amanera Golf Resort at Playa Grande, in the Dominican Republic, was delivered as scheduled and formally opened for paying guests on 23 November 2015. The Amanera Hotel achieved occupancy of 43.5% and and ADR of US$1,549 during January to August 2016 for which period it was open and under the Dolphin ownership.

- On 15 November 2016 the Company entered into an agreement for the disposal of the project to a joint venture comprising an affiliate of Third Point LLC, an affiliate of Discovery Land Company and others. The disposal was agreed at an enterprise value of €140 million which represented a 10% discount to the project's carrying gross asset value as at 30 June 2016 and resulted in a loss on sale of €25 million.

- The disposal was completed on 8 December 2016, when DCI received €4.6 million cash consideration (of which €0.9 million remained in escrow to cover certain potential post completion claims and liabilities) and all of the Company's €50 million and US$9.17 million 2018 Convertible Bonds which were held by Third Point LLC were cancelled.

- This disposal reduced the aggregate DCI Group loans from €215 million as at 30 June 2016 to €102 million resulting in a pro forma debt/asset ratio for the Group of 18.5%.

· Kilada Hills Golf Resort, Greece

- The next phase of the Kilada Hills strategic permitting progress entails the issuance of final construction permits for the project's private residential masterplan comprising 170,000m². The masterplan was submitted for approval to the competent zoning authorities on 8 June 2016 and the issuance of final permits that are necessary for the commencement of infrastructure works are expected to be in place by the end of 2017.

- Dolphin has soft-launched the Founders Program proposal, which comprises 40 founders' memberships in the Kilada Hills golf resort community which will comprise a new Jack Nicklaus Signature Golf Course, a Clubhouse, a Beach Club and other sports amenities. The Founders memberships are competitively priced at €500,000 each, offering founding members freehold title to a 2,000m² lot overlooking the Kilada Hills golf course with the right to build a villa of up to 800m², lifetime golf memberships and additional privileges.

- The funds raised through the Founders Program will be placed in escrow until the project's golf course, clubhouse and related infrastructure are completed and the golf lots are delivered to the Founders Program members. The Company is in the process of arranging development bridge-financing through a local bank which will be repaid from the Founders' Program escrowed proceeds.

· Pearl Island ("Pearl Island" - www.pearlisland.com), Panama

- In Pearl Island, a private island located in the Archipelago de las Perlas, the Ritz Carlton Reserve detailed design phase and value engineering were completed during 2016 to ensure that the development budget could be achieved.

- In November 2016, the project also secured a debt financing of US$33 million with a regional bank (Banistmo S.A.) to be used in the development of the Ritz Carlton phase of the project which to date has not been drawn down.

- Following the permitting and financing developments, on 17 January 2017, the Company entered into a sale agreement for the disposal of its 60% interest in Pearl Island to Grivalia Hospitality S.A. ("Grivalia").

- The cash consideration on disposal (before related taxes and fees) of €27 million represented a discount of 7% on the Company's €29 million cost of investment in Pearl Island. The implied transaction enterprise value of €63 million was at a 32% discount to DCI's gross asset carrying value as at 30 June 2016 and resulted in a loss on sale of €25 million.

- The disposal was completed on 13 March 2017 and Dolphin received the €26 million cash consideration balance. Of the total consideration, €2 million will remain in escrow for a period of 12 months post completion to cover any potential tax liabilities, breach of warranties or undisclosed indebtedness.

· Kea Resort, Greece

- The Company continues to advance discussions with an international resort and real estate investor for a joint venture transaction involving an equity investment, for the monies required for the construction of the Kea Resort, for a 50% shareholding in the project.

· Aristo Developers Ltd ("Aristo", a 47.9% affiliate)

Operating Performance

- Aristo sold 107 homes and plots during 2016, representing total sales of €44.4 million, up 44.5% compared to 2015.

- There was a strong sales momentum from overseas countries during 2016. A new office initiated operations in Egypt and several agreements were signed in H1 2016 with new agents aiming to establish Aristo as a major provider of Cyprus residential permit related product in those countries.

- This sales momentum has continued in 2017, with 27 homes and plots sales during the first three months of 2017, representing total sales of €17.7 million, up 110% compared to the respective period in 2016.

	Q1 2017	Q1 2016	Twelve months to	Twelve months to
			31 December 2016	31 December 2015
RETAIL SALES
New sales booked	€17,693,066	€ 8,406,120	€ 44,436,273	€ 30,746,867
% change	110%		44.5%
Units sold	27	22	107	70
% change	22.7%		53%
CLIENT ORIGIN
China	55.6%	45%	43%	76.21%
Russia	14.8%	5%	4.6%	12.73%
Other overseas	25.9%	9%	32.7%	5.25%
Cyprus	3.7%	41%	15.8%	4.50%
UK	-	-	1%	1.30%
Central & North Europe	-	-	2.80%	-

Termination of Agreement for the disposal of DCI's stake in Aristo

- On 29 September 2016 the Company signed an agreement to sell its 49.75% stake in Aristo to a legal entity owned by Mr. Theodore Aristodemou and his family for a €45 million cash consideration. This represented a 70% discount to the carrying value as at 31 December 2015 on a pro-forma basis, reflecting Aristo's debt restructuring agreed with Bank of Cyprus. The €45 million cash consideration was agreed to be payable in quarterly instalments over three years and bearing annual interest of 4% in the first year, increasing to 5% and 6% respectively for each of the ensuing two years.

- The Company has received to date €1.8 million of the cash consideration out of the €45 million due under the sale agreement. Mr. Aristodemou had indicated to the Company that payment of the instalments due under the sale agreement would be uncertain whilst he remains involved in on-going litigation in Cyprus relating to his tenure as the Bank of Cyprus Chairman and until there is more clarity and certainty on the expected outcome of the respective court proceedings. In that regard, and due to Mr. Aristodemou's failure to settle the deferred payments as they became due, the Company decided on 3 May 2017 to terminate the existing agreement and retain the unpaid portion of its Aristo shares which corresponds to 47.9%. The Company will provide a further update on its plans to realise value from its shareholding in Aristo in due course.

· Sitia Bay Resort, Crete (www.sitiabayresort.com)

- The Presidential decree for the residential zoning in Sitia Bay was issued on 20 July 2016; this provided legal entitlement for the sale of residential lots independently from the resort development for which the permits are already in place.

· Nikki Beach, Porto Heli (a 25% DCI affiliate)

- The operations improved during 2016 compared to 2015. Occupancy for the 2016 operational period was 50% (163 days) compared to 48% for 2015 (169 days), with a net ADR up approximately 25% at €253.

- The Company reached on 23 February 2017 a commercial co-operation agreement with a local group active in hotel consultancy and operations, regarding the commercial exploitation of the Nikki Beach Porto Heli, as a result of which the Company will have no financial exposure from the day-to-day operational performance of the hotel and will receive an annual revenue-linked payment. This agreement will not affect the operating agreement with Nikki Beach Hotels EMEA which remains in place.

· Apollo Heights , Cyprus

- Publication of the long-awaited proposed zoning by the Cyrpus Government was expected to take place by the end of the first quarter of 2017, but is now expected to take place in the second quarter of 2017.

Β.3.2. Market Dynamics

According to the Wealth Report 2017 by Knight Frank, the number of ultra-wealthy people worldwide is expected to grow by 43% by 2026. There may be widespread uncertainty on a global, regional and national level, but there are also strong fundamentals in many economies, with signs of real progress being made around regulation and policy which will help economic growth to flourish in some places.

The main observations of the regions of interest to the Company are as follows:

- In Greece 2016 was a fruitful year for tourism, according to the data released from the Greek Tourism Confederation (SETE), with a 9% rise in international air arrivals for the year with 16.9 million total air arrivals. The message for 2017 is positive as well where tourism revenues are expected to rise by 8% to €14.5 billion compared to €13.2 billion in 2016.

- In Cyprus the latest available data for the tourism industry highlighted, once again, that tourism was amongst one of the key catalysts to the country's 2016 economic performance, as revenues reached €2.36 billion at the end of the year surpassing 2015 (€2.1 million) by 11.9%. Total arrivals amounted to 3.2 million in 2016 versus 2.65 million in the previous year. Cyprus expects to hit another record number of tourists during 2017, with visits expected to increase by 5% over last year.

- In Turkey the number of foreign tourists was 36.2 million in 2015 and fell to 25.4 million in 2016. This 30% drop can be explained by a 31% drop in European tourists due an increase in terrorism by ISIS/PKK and the tension with Russia. The January and February 2017 figures show that the slowdown is continuing this year with a 8% drop compared to the same months in 2016.

- In Croatia tourism enjoyed a record year in 2016. According to the country's official statistics, a record 16.3 million tourists visited Croatia in 2016. The 16.3 million arrivals, around 2.2 million more than 2015, created a record 91.3 million overnight stays, 11 million more than in 2015.

C. Group Assets

A summary of Dolphin's current investments is presented below. As at 31 December 2016, the net invested amount stood at €514* million.

	PROJECT	Land site (hectares)	DCI's stake	Investment cost* (€m)	Debt (€m) **	Real estate value (€m)	Loan to real estate asset value (%)

1	Amanzoe	93	100%	38	76
2	Kilada Hills Golf Resort	235	100%	94	-
3	Kea Resort	65	67%	9	-
4	Pearl Island***	1323	60%	29
	TOTAL	1.716		170	76	260	29%


5	The Nikki Beach Resort & Spa	1	25%	6	-
6	Sitia Bay Golf Resort	270	78%	17	-
7	Scorpio Bay Resort	172	100%	15	-
8	Lavender Bay Resort	310	100%	25	-
9	Plaka Bay Resort	442	100%	13	-
10	Triopetra	11	100%	4	-
11	Apollo Heights Polo Resort	461	100%	23	16
12	Livka Bay Resort	63	100%	28	8
13	La Vanta - Mediterra Resorts	8	100%	17	< 1
	TOTAL	1.738		148	24	150	16%
	ARISTO CYPRUS*	1.448	48.7%	194	-	43
	Itacaré Investment	n/a	13%	2	-	1
	GRAND TOTAL	4.902		514	101	455	22%

*Residual investment cost, including amounts paid in shares.

**Further details on debt maturities are set out under note 25 of the financial statements.

*** Sold in March 2017

A breakdown of Dolphin's portfolio, as at 31 December 2016, for certain key metrics is provided below:

	COUNTRY	Land size (hectares)	Investment Cost * (€ million)	Debt (€ million)	Real Estate Value (€ million)	% Loan to real estate asset value	Net Asset Value
1	Greece	1.599	221	76	287	26%	57%
2	Cyprus**	1.909	216	16	73	22%	21%
3	Americas	1.323	31	-	55	0%	10%
4	Other	71	46	9	41	22%	12%
	Grand Total	4.902	514	101	455	22%	100%

*Residual investment cost, including amounts paid in shares.

**DCI' s portfolio in Cyprus includes its equity investment in Aristo Developers Ltd, which owns assets in Cyprus that are subject to Aristo's debt and other obligations.

D. Future Objectives

Our main objectives for 2017 are to:

1. Maximise value for shareholders and generate additional liquidity through the monetisation of assets;

2. Secure third party funding for the development of Kea and Kilada Hills so that they become more attractive to potential investors and acquirers;

3. Increase the sales velocity of villas at Amanzoe; and

4. Where appropriate, advance the zoning, permitting, design and branding of certain assets to improve their sales potential and value.

Miltos Kambourides

Managing Partner

Dolphin Capital Partners

4 May 2017

Pierre Charalambides

Founding Partner

Dolphin Capital Partners

4 May 2017

E. Financial Position for the year ended 31 December 2016

E1. Consolidated statement of profit or loss and other comprehensive income for the year ended 31 December 2016.

· Financial Results

Loss after tax for the period ended 31 December 2016 attributable to owners of the Company amounted to €(244) million compared to €(145) million for the year ended 31 December 2015. Loss per share was €0.27 in 2016 and €0.18 in 2015. The reduction was principally due to:

- the reduction in the carrying value of Aristo by a total of €144 million during the year; which is made up of €35 million as a result of the debt restructuring agreement reached with Bank of Cyprus in June 2016 and operating losses, and a further €109 million write-down to reflect the agreed €45 million sales price;

- the loss from the sale of Playa Grande amounting to €25 million;

- the reduction in the carrying value of Pearl Island by €25 million to the €27 million sales price;

- the year-end net valuation losses and impairment charges of €21 million;

- the Group's other operational, corporate, finance and management expenses.


	31 December 2016	31 December 2015

	€'000	€'000
Continuing operations
Revenue	18,148	47,680
Cost of sales	(17,357)	(46,779)
Gross profit	791	901
Disposal of investments	785	823
Change in valuations	(136,512)	(61,862)
Investment Manager remuneration	(11,406)	(13,128)
Directors' remuneration	(1,509)	(904)
Depreciation charge	(2,284)	(2,241)
Professional fees	(5,480)	(4,873)
Administrative and other expenses	(2,232)	(5,132)
Total operating and other expenses	(158,638)	(87,317)
Results from operating activities	(157,847)	(86,416)
Finance income	29	87
Finance costs	(15,099)	(17,731)
Net finance costs	(15,070)	(17,644)
Share of losses on equity-accounted investees, net of tax	(34,389)	(44,553)
Loss before taxation	(207,306)	(148,613)
Taxation	3,584	15,359
Loss from continuing operations	(203,722)	(133,254)
DISContinuED operation
Loss from discontinued operation, net of tax	(57,268)	(14,741)
Loss	(260,990)	(147,995)
Other comprehensive income
Items that will not be reclassified to profit or loss
Revaluation of property, plant and equipment	5,796	(15,181)
Share of revaluation on equity-accounted investees	17	27
Related tax	(1,682)	1,791
	4,131	(13,363)
Items that are or may be reclassified subsequently to profit or loss
Foreign currency translation differences	(7,458)	17,221
Change in fair value of available-for-sale financial assets	(256)	-
	(7,714)	17,221
Other comprehensive income, net of tax	(3,583)	3,858
Total comprehensive income	(264,573)	(144,137)
Loss attributable to:
Owners of the Company	(243,762)	(145,360)
Non-controlling interests	(17,228)	(2,635)
	(260,990)	(147,995)
Total comprehensive income attributable to:
Owners of the Company	(247,481)	(144,228)
Non-controlling interests	(17,092)	91
	(264,573)	(144,137)
Loss per share
Basic and diluted loss per share (€)	(0.27)	(0.18)
Basic and diluted loss per share - Continuing operations (€)	(0.22)	(0.16)
Basic and diluted loss per share - Discontinued operation (€)	(0.05)	(0.02)

Further analysis of individual revenue and expense items is provided below.

· Revenue

Revenues from continuing operations of €18.1 million (31 December 2015: €47.7 million), were derived from the following sources:

	31 December 2016 € million	31 December 2015 € million
Income from hotel operations	11.5	10.3
Income from construction contracts	0.0	2.3
Sale of trading and investment properties	6.2	34.6
Rental income	0.0	0.3
Other income	0.4	0.2
TOTAL	18.1	47.7

The significant reduction in the sale of trading and investment properties relates primarily to the lower number of villas delivered in 2016 in the Amanzoe project, whereas in 2015 four villas were delivered while in 2016 the deliveries fell to one cabana and one plot.

· Cost of sales

Cost of sales from continuing operations comprises the following basic categories:

	31 December 2016 € million	31 December 2015 € million
Cost of sales related to:
Hotel operations	4.0	3.5
Construction contracts	0.0	2.5
Sales of trading and investment properties	5.3	29.9
Commission to agents and others	0.4	0.4
Electricity and fuel	0.1	0.1
Personnel expenses	5.6	5.5
Branding management fees	1.6	3.5
Other operating expenses	0.4	1.4
TOTAL	17.4	46.8

The charge of cost of sales from continuing operations for the period amounted to €17.4 million (31 December 2015: €46.8 million). The decrease is largely attributable to cost of Villas sold reflecting the above mentioned reduction in Villa deliveries.

· Professional Fees

The charge for the period from continuing operations was €5.5 million (31 December 2015: €4.9 million) and comprises the following:

	31 December 2016 € million	31 December 2015 € million
Legal fees	0.9	0.7
Auditors' remuneration	0.7	0.8
Accounting expenses	0.3	0.3
Appraisers' fees	0.1	0.1
Project design and development fees	1.9	1.5
Consultancy fees	0.7	0.2
Administrator fees	0.1	0.3
Other professional fees	0.8	1.0
TOTAL	5.5	4.9

Increase in consultancy fees is mainly attributable to the Houlihan Lokey fees incurred during the period.

· Administrative and other expenses

The administrative and other expenses from continuing operations amounted to €2.2 million (31 December 2015: €5.1 million) and are analysed as follows:

	31 December 2016 € million	31 December 2015 € million
Travelling and accommodation	0.4	0.5
Insurance	0.1	0.1
Repairs and maintenance	0.1	0.1
Marketing and advertising expenses	0.3	0.4
Litigation liability provisions*	0.0	2.0
Immovable property and other taxes	0.5	0.7
Rents	0.2	0.2
Other	0.6	1.1
TOTAL	2.2	5.1
*€1.9 million in 2015 related to Zoniro (Greece) S.A. which was divested in 2015.

· Change in valuations

Change in valuations from continuing operations amounted to €136.5 million (31 December 2015: €61.9 million) and are analysed as follows:

	31 December 2016 € million	31 December 2015 € million
Net change in fair value of investment property	22.1	53.2
Impairment loss on trading properties	0.7	3.4
Impairment loss on re-measurement on disposal groups	4.2	0.8
Impairment loss on equity-accounted investees	109.3*	0.0
Reversal of Impairment loss and write-offs of property, plant and equipment	(0.1)	1.9
Concession/write off of land	0.3	2.6

TOTAL	136.5	61.9
*Amount reflects the write-down in Aristo's carrying amount to the €45 million agreed sales price

E.2. Consolidated statement of financial position as at 31 December 2016

	31 December 2016	31 December 2015
	€'000	€'000
Assets
Property, plant and equipment	87,647	187,015
Investment property	176,548	340,853
Equity-accounted investees	-	188,637
Available-for-sale financial assets	-	2,201
Deferred tax assets	996	997
Trade and other receivables	-	1,178
Non-current assets	265,191	720,881
Trading properties	29,763	37,387
Trade and other receivables	4,001	15,002
Cash and cash equivalents	4,698	41,990
Assets held for sale	162,435	70,240
Current assets	200,897	164,619
Total assets	466,088	885,500
Equity
Share capital	9,046	9,046
Share premium	569,847	569,847
Retained deficit	(365,689)	(121,706)
Other reserves	20,683	24,402
Equity attributable to owners of the Company	233,887	481,589
Non-controlling interests	17,993	34,939
Total equity	251,880	516,528
Liabilities
Loans and borrowings	79,521	191,152
Finance lease liabilities	2,934	2,956
Deferred tax liabilities	24,255	30,129
Trade and other payables	6,479	6,698
Deferred revenue	7,230	17,846
Non-current liabilities	120,419	248,781
Loans and borrowings	12,749	32,528
Finance lease liabilities	48	77
Trade and other payables	43,112	58,241
Deferred revenue	10,683	11,220
Liabilities held for sale	27,197	18,125
Current liabilities	93,789	120,191
Total liabilities	214,208	368,972
Total equity and liabilities	466,088	885,500
Net asset value ('NAV') per share (€)	0.26	0.53

The reported NAV as at 31 December 2016 is presented below:

	As at 31 December 2016		Variation since 31 December 2015
	€	£	€	£
Total NAV before DTL (million)	265	227	(49.0%)	(40.8%)
Total NAV after DTL (million)	234	200	(51.4%)	(43.6%)
NAV per share before DTL	0.29	0.25	(49.0%)	(40.8%)
NAV per share after DTL	0.26	0.22	(51.4%)	(43.6%)

___________

Notes:

1. Euro/GBP rate 0.85637 as at 31 December 2016 and 0.73693 as at 31 December 2015.

2. Euro/USD rate 1.0541 as at 31 December 2016 and 1.0887 as at 31 December 2015.

3. NAV per share has been calculated on the basis of 904,626,856 issued shares as at 31 December 2016 and as at 31 December 2015.

Total Group NAV as at 31 December 2016 was €265 million and €234 million before and after DTL respectively. This represents a decrease of €255 million (49.0%) and €248 million (51.4%), respectively, from the 31 December 2015 figures. This NAV reduction is mainly due to the valuation writedowns relating to the Company's assets, impairment charges relating to its shareholding in Aristo and Pearl Island to reflect their agreed sales price, losses from the Playa Grande sale, as well as Dolphin's regular fixed operational, corporate, finance and management expenses.

Sterling NAV per share as at 31 December 2016 was 25p before DTL and 22p after DTL and decreased by 40.8% and 43.6%, before and after DTL respectively compared to the 31 December 2015 figures. The valuation decreases and operational expenses mentioned above, were counter-balanced by a 16.2% appreciation of Euro versus the Sterling.

The Company's consolidated assets include €294 million of real estate assets, €162 million of assets held for sale, €5million of other assets (trade and other receivables and deferred tax asset) and €5 million in cash.

The balance of €294 million of real estate assets (property, plant and equipment, investment property and trading properties) represents the independent property valuations conducted as at 31 December 2016 by American Appraisal (for the Greek and Cypriot projects) for both freehold and long leasehold interests.

The €162 million of assets held for sale includes €115 million of real estate assets, €44 million of investment in equity accounted investees (the Company's 48.7% and 25% interest in Aristo and Nikki beach respectively as at 31 December 2016), €1 million of available-for-sale financial assets which represents the Company's investment in Itacare and €2 million of other assets. The €115 million figure comprises the appraised value of Sitia Bay, Livka Bay and La Vanta (Colliers International conducted the independent property valuation for Croatia and Turkey), as well as the writedown in value of Pearl Island's assets, based on the sale agreement with Grivalia.

The Company's consolidated liabilities (excluding DTL) total €182 million and mainly comprise €103 million of interest bearing loans and finance lease obligations (of which €8 million are classified as liabilities held for sale). All loans are held by Group subsidiaries and are non-recourse to Dolphin. The €79 million of trade and other payables and deferred revenue (including €11 million of trade and other payables held for sale) comprise mainly €25 million of option contracts to acquire land in the Company's Lavender Bay project, €7 million deferred income from government grants and €11 million of client advances from villa sales.

Consolidated statement of profit or loss and other comprehensive income

For the year ended 31 December 2016

		31 December 2016	31 December 2015
			(Restated)
	Note	€'000	€'000
Continuing operations
Revenue	6	18,148	47,680
Cost of sales	7	(17,357)	(46,779)
Gross profit		791	901
Disposal of investments	8A	785	823
Change in valuations	8B	(136,512)	(61,862)
Investment Manager remuneration	31.2	(11,406)	(13,128)
Directors' remuneration	31.1	(1,509)	(904)
Depreciation charge	16	(2,284)	(2,241)
Professional fees	11	(5,480)	(4,873)
Administrative and other expenses	12	(2,232)	(5,132)
Total operating and other expenses		(158,638)	(87,317)
Results from operating activities		(157,847)	(86,416)
Finance income	13	29	87
Finance costs	13	(15,099)	(17,731)
Net finance costs		(15,070)	(17,644)
Share of losses on equity-accounted investees, net of tax	21	(34,389)	(44,553)
Loss before taxation		(207,306)	(148,613)
Taxation	14	3,584	15,359
Loss from continuing operations		(203,722)	(133,254)
DISContinuED operation
Loss from discontinued operation, net of tax	10	(57,268)	(14,741)
Loss		(260,990)	(147,995)
Other comprehensive income
Items that will not be reclassified to profit or loss
Revaluation of property, plant and equipment	16	5,796	(15,181)
Share of revaluation on equity-accounted investees	21	17	27
Related tax	14	(1,682)	1,791
		4,131	(13,363)
Items that are or may be reclassified subsequently to profit or loss
Foreign currency translation differences	13	(7,458)	17,221
Change in fair value of available-for-sale financial assets	20	(256)	-
		(7,714)	17,221
Other comprehensive income, net of tax		(3,583)	3,858
Total comprehensive income		(264,573)	(144,137)
Loss attributable to:
Owners of the Company		(243,762)	(145,360)
Non-controlling interests		(17,228)	(2,635)
		(260,990)	(147,995)
Total comprehensive income attributable to:
Owners of the Company		(247,481)	(144,228)
Non-controlling interests		(17,092)	91
		(264,573)	(144,137)
Loss per share
Basic and diluted loss per share (€)	15	(0.27)	(0.18)
Basic and diluted loss per share - Continuing operations (€)	15	(0.22)	(0.16)
Basic and diluted loss per share - Discontinued operation (€)	15	(0.05)	(0.02)

Consolidated statement of financial position

As at 31 December 2016

		31 December 2016	31 December 2015
	Note	€'000	€'000
Assets
Property, plant and equipment	16	87,647	187,015
Investment property	17	176,548	340,853
Equity-accounted investees	21	-	188,637
Available-for-sale financial assets	20	-	2,201
Deferred tax assets	26	996	997
Trade and other receivables	22	-	1,178
Non-current assets		265,191	720,881
Trading properties	19	29,763	37,387
Trade and other receivables	22	4,001	15,002
Cash and cash equivalents	23	4,698	41,990
Assets held for sale	18	162,435	70,240
Current assets		200,897	164,619
Total assets		466,088	885,500
Equity
Share capital	24	9,046	9,046
Share premium	24	569,847	569,847
Retained deficit		(365,689)	(121,706)
Other reserves		20,683	24,402
Equity attributable to owners of the Company		233,887	481,589
Non-controlling interests		17,993	34,939
Total equity		251,880	516,528
Liabilities
Loans and borrowings	25	79,521	191,152
Finance lease liabilities	27	2,934	2,956
Deferred tax liabilities	26	24,255	30,129
Trade and other payables	29	6,479	6,698
Deferred revenue	28	7,230	17,846
Non-current liabilities		120,419	248,781
Loans and borrowings	25	12,749	32,528
Finance lease liabilities	27	48	77
Trade and other payables	29	43,112	58,241
Deferred revenue	28	10,683	11,220
Liabilities held for sale	18	27,197	18,125
Current liabilities		93,789	120,191
Total liabilities		214,208	368,972
Total equity and liabilities		466,088	885,500
Net asset value ('NAV') per share (€)	30	0.26	0.53

Consolidated statement of changes in equity

For the year ended 31 December 2016

	Attributable to owners of the Company
	Share	Share	Translation	Revaluation	Retained		Non-controlling	Total
	capital	premium	reserve	reserve	deficit	Total	interests	equity
	€'000	€'000	€'000	€'000	€'000	€'000	€'000	€'000
Balance at 1 January 2015	6,424	498,933	10,695	12,575	28,821	557,448	30,364	587,812
Total comprehensive income
Loss	-	-	-	-	(145,360)	(145,360)	(2,635)	(147,995)
Other comprehensive income
Revaluation of property, plant and equipment, net of tax	-	-	-	(12,993)	-	(12,993)	(397)	(13,390)
Foreign currency translation differences	-	-	13,244	854	-	14,098	3,123	17,221
Share of revaluation on equity-accounted investees	-	-	-	27	-	27	-	27
Total other comprehensive income	-	-	13,244	(12,112)	-	1,132	2,726	3,858
Total comprehensive income	-	-	13,244	(12,112)	(145,360)	(144,228)	91	(144,137)
Transactions with owners of the Company
Contributions and distributions
Issue of ordinary shares	2,193	60,527	-	-	-	62,720	-	62,720
Placement costs	-	(1,464)	-	-	-	(1,464)	-	(1,464)
Bond conversions	429	11,851	-	-	-	12,280	-	12,280
Equity-settled share-based payment arrangements	-	-	-	-	375	375	-	375
Non-controlling interests on capital increases of subsidiaries	-	-	-	-	(545)	(545)	545	-
Total contribution and distributions	2,622	70,914	-	-	(170)	73,366	545	73,911
Changes in ownership interests
Acquisition of non-controlling interests without a change in control	-	-	-	-	(4,997)	(4,997)	3,236	(1,761)
Other movement in non-controlling interests	-	-	-	-	-	-	703	703
Total changes in ownership interests	-	-	-	-	(4,997)	(4,997)	3,939	(1,058)
Total transactions with owners of the Company	2,622	70,914	-	-	(5,167)	68,369	4,484	72,853
Balance at 31 December 2015	9,046	569,847	23,939	463	(121,706)	481,589	34,939	516,528
Balance at 1 January 2016	9,046	569,847	23,939	463	(121,706)	481,589	34,939	516,528
Total comprehensive income
Loss	-	-	-	-	(243,762)	(243,762)	(17,228)	(260,990)
Other comprehensive income
Revaluation of property, plant and equipment, net of tax	-	-	-	4,114	-	4,114	-	4,114
Foreign currency translation differences	-	-	(7,594)	-	-	(7,594)	136	(7,458)
Share of revaluation on equity accounted investees	-	-	-	17	-	17	-	17
Fair value adjustment on available-for-sale financial asset	-	-	-	(256)	-	(256)	-	(256)
Total other comprehensive income	-	-	(7,594)	3,875	-	(3,719)	136	(3,583)
Total comprehensive income	-	-	(7,594)	3,875	(243,762)	(247,481)	(17,092)	(264,573)
Transactions with owners of the Company
Contributions and distributions
Equity-settled share-based payment arrangements	-	-	-	-	(221)	(221)	-	(221)
Total contribution and distributions	-	-	-	-	(221)	(221)	-	(221)
Changes in ownership interests
Other movement in non-controlling interests	-	-	-	-	-	-	146	146
Total transactions with owners of the Company	-	-	-	-	-	-	146	146
Balance at 31 December 2016	9,046	569,847	16,345	4,338	(365,689)	233,887	17,993	251,880

Consolidated statement of cash flows

For the year ended 31 December 2016

	31 December 2016	31 December 2015
	€'000	€'000
Cash flows from operating activities
Loss	(260,990)	(147,995)
Adjustments for:
Net change in fair value of investment property	64,584	45,047
Impairment loss on trading properties	724	3,431
Loss/(gain) on disposal of investment in subsidiaries	23,932	(823)
Gain on disposal of investment in equity-accounted investees	(151)	-
Share of losses on equity-accounted investees, net of tax	34,389	44,553
Equity-settled share-based payment arrangements	(221)	375
Impairment loss on equity-accounted investees	109,265	-
Impairment loss on re-measurement of disposal groups	4,197	763
Impairment loss on available-for-sale financial assets	995	-
(Reversal of) impairment loss and write offs of property, plant and equipment	(92)	15,247
Concession/write off of land	292	2,607
Depreciation charge	2,780	2,919
Interest income	(30)	(106)
Interest expense	15,314	19,700
Exchange difference	(13,922)	2,590
Taxation	(4,857)	(15,296)
	(23,791)	(26,988)
Changes in:
Receivables	9,380	810
Payables	3,286	16,495
Cash used in operating activities	(11,125)	(9,683)
Tax paid	(74)	(160)
Net cash used in operating activities	(11,199)	(9,843)
Cash flows from investing activities
Proceeds/(outflow) from disposal of subsidiaries, net of cash disposed of	61,239	(299)
Proceeds from disposal of investment in equity-accounted investees	1,101	-
Net acquisitions of investment property	(11)	(308)
Net acquisitions of property, plant and equipment	(2,515)	(42,260)
Net change in trading properties	3,200	16,189
Net change in equity-accounted investees	-	(286)
Net change in net assets held for sale	291	-
Interest received	30	106
Net cash from/(used in) investing activities	63,335	(26,858)
Cash flows from financing activities
Proceeds from issue of share capital	-	61,256
Acquisition of non-controlling interests without a change in control	-	(1,761)
Change in loans and borrowings	(78,643)	3,892
Change in finance lease obligations	(51)	1,100
Interest paid	(10,652)	(13,183)
Net cash (used in)/from financing activities	(89,346)	51,304
Net (decrease)/increase in cash and cash equivalents	(37,210)	14,603
Cash and cash equivalents at 1 January	41,990	28,739
Effect of movement in exchange rates on cash held	101	(587)
Cash and cash equivalents reclassified to assets held for sale	(183)	(765)
Cash and cash equivalents at 31 December	4,698	41,990
For the purpose of the consolidated statement of cash flows, cash and cash equivalents consist of the following:
Cash in hand and at bank (see note 23)	4,698	41,990
Cash and cash equivalents at the end of the year	4,698	41,990

1. REPORTING ENTITY

Dolphin Capital Investors Limited (the 'Company') was incorporated and registered in the British Virgin Islands ('BVIs') on 7 June 2005. The Company is a real estate investment company focused on the early-stage, large-scale leisure-integrated residential resorts in south-east Europe and the Americas, and managed by Dolphin Capital Partners Limited (the 'Investment Manager'), an independent private equity management firm that specialises in real estate investments, primarily in south-east Europe. The shares of the Company were admitted to trading on the AIM market of the London Stock Exchange ('AIM') on 8 December 2005.

The consolidated financial statements of the Company as at 31 December 2016 comprise the financial statements of the Company and its subsidiaries (together referred to as the 'Group') and the Group's interests in associates.

2. basis of preparation

a. Statement of compliance

The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards ('IFRS') as adopted by the European Union ('EU').

The consolidated financial statements were authorised for issue by the Board of Directors on 3 May 2017.

b. Basis of preparation

The consolidated financial statements of the Company for the year ended 31 December 2016 have been prepared taking into account the Company's intention to dispose of all of its assets by 31 December 2019, as further explained below. The basis of preparation used continues to be in accordance with International Financial Reporting Standards as adopted by the European Union.

Based on the Company's new asset strategy approved by its shareholders in December 2016, the Company's objective is to dispose of all of the Company's assets by 31 December 2019. The allocation of any additional capital investment into any of the Company's projects will be substantially sourced from third party capital providers and with the sole objective of enhancing the respective asset's realisation potential until 31 December 2019. The Board expects to return the proceeds from asset disposals to shareholders, as the orderly realisation of the Company's assets progresses and taking into account the Company's liquidity position and working capital requirements. In the event that any assets are still held by the Company shortly before 31 December 2019, the Board will convene a shareholders' meeting at which appropriate resolutions for the future of the Company will be proposed.

c. Basis of measurement

The consolidated financial statements have been prepared under the historical cost convention, with the exception of property (investment property, property, plant and equipment), available-for-sale financial assets, which are stated at their fair values, assets and liabilities held for sale, which are stated at their fair value less costs to sell and investments in associates, which are accounted for in accordance with the equity method of accounting.

d. Adoption of new and revised standards and interpretations

As from 1 January 2016, the Group adopted all changes to IFRS which are relevant to its operations. This adoption did not have a material effect on the consolidated financial statements of the Company.

The following standards, amendments to standards and interpretations have been issued but are not yet effective for annual periods beginning on 1 January 2016. Those which may be relevant to the Group are set out below. The Group does not plan to adopt these standards early. The Group continues to assess the potential impact on its consolidated financial statements resulting from the application of the following standards.

(i) Standards and interpretations adopted by the EU

IFRS 15 'Revenue from contracts with customers' (effective for annual periods beginning on or after 1 January 2018).

IFRS 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. It replaces existing revenue recognition guidance, including IAS 18 Revenue, IAS 11 Construction Contracts and IFRIC 13 Customer Loyalty Programs.

(ii) Standards and interpretations not adopted by the EU

IAS 7 (Amendments) 'Disclosure Initiative' (effective for annual accounting periods beginning on or after 1 January 2017).

The amendments require disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flow and non-cash changes.

IAS 12 (Amendments) 'Recognition of Deferred Tax Assets for Unrealised Losses' (effective for annual accounting periods beginning on or after 1 January 2017).

The amendments clarify the accounting for deferred tax assets for unrealised losses on debt instruments measured at fair value.

Annual Improvements to IFRSs 2014-2016 Cycle (effective for annual periods beginning on or after 1 January 2017 (IFRS 12) and 1 January 2018 (IFRS 1 and IAS 28)).

The annual improvements impact three standards. The amendments to IFRS 1 remove the outdated exemptions for first-time adopters of IFRS. The amendments to IFRS 12 clarify that the disclosure requirements for interest in other entities also apply to interests that are classified as held for sale or distribution. The amendments to IAS 28 clarify that the election to measure at fair value through profit or loss an investment in associate or a joint venture that is held by an entity that is a venture capital organisation, or other qualifying entity, is available for each investment in an associate or joint venture on an investment-by-investment basis, upon initial recognition.

IFRS 15 (Clarifications) 'Revenue from Contracts with Customers' (effective for annual periods beginning on or after 1 January 2018).

The amendments in Clarifications to IFRS 15 address three of the five topics identified i.e. identifying performance obligations, principal versus agent considerations, and licensing. The clarifications provide some transition relief for modified contracts and completed contracts. Additionally, the IASB concluded that it was not necessary to amend IFRS 15 with respect to the collectability or measuring non-cash consideration.

IFRS 16 'Leases' (effective for annual periods beginning on or after 1 January 2019).

IFRS 16 introduces a single, on-balance lease sheet accounting model for lessees. A lessee recognises a right-of-use asset representing its right to use the underlying asset and a lease liability representing its obligation to make lease payments. There are optional exemptions for short-term leases and leases of low value items. Lessor accounting remains similar to the current standard - i.e. lessors continue to classify leases as finance or operating leases.

IFRS 16 replaces existing leases guidance including IAS 17 Leases, IFRIC 4 Determining whether an Arrangement contains a Lease, SIC-15 Operating Leases-Incentives and SIC-27 Evaluating the Substance of Transactions Involving the Legal Form of a Lease.

e. Use of estimates and judgements

The preparation of consolidated financial statements in accordance with IFRS requires from Management the exercise of judgement, to make estimates and assumptions that influence the application of accounting principles and the related amounts of assets and liabilities, income and expenses. The estimates and underlying assumptions are based on historical experience and various other factors that are deemed to be reasonable based on knowledge available at that time. Actual results may deviate from such estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected. In particular, information about significant areas of estimation, uncertainty and critical judgements in applying accounting policies that have the most significant effect on the amounts recognised in the consolidated financial statements are described below:

Work in progress

Work in progress is stated at cost plus any attributable profit less any foreseeable losses and less amounts received or receivable as progress payments. The cost of work in progress includes materials, labour and direct expenses plus attributable overheads based on a normal level of activity. The Group uses its judgement to select a variety of methods and make assumptions that are mainly based on market conditions existing at each statement of financial position date.

Revenue recognition

The Group applies the provisions of IAS18 for accounting for revenue from sale of developed property, under which income and cost of sales are recognised upon delivery and when substantially all risks have been transferred to the buyer.

Provision for bad and doubtful debts

The Group reviews its trade and other receivables for evidence of their recoverability. Such evidence includes the customer's payment record and the customer's overall financial position. If indications of irrecoverability exist, the recoverable amount is estimated and a respective provision for bad and doubtful debts is made. The amount of the provision is charged through profit or loss. The review of credit risk is continuous and the methodology and assumptions used for estimating the provision are reviewed regularly and adjusted accordingly.

Taxation

Significant judgement is required in determining the provision for taxation. There are transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

Going concern assumptions

The Group's cash flow forecasts for the foreseeable future involve uncertainties related primarily to the exact disposal proceeds and timing of disposals of the assets expected to be disposed of. Management believes that the proceeds from forecasted asset sales will be sufficient to maintain the Group's cash flow forecasts at a positive level. Should the need arise, management is confident that it can secure additional banking facilities and/or obtain waivers on existing ones, until planned asset sales are realised and proceeds received. If for any reason the Group is unable to continue as a going concern, then this could have an impact on the Group's ability to realise assets at their recognised values and to extinguish liabilities in the normal course of business at the amounts stated in the consolidated financial statements.

Measurement of fair values

A number of the Group's accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities.

The Group has an established control framework with respect to the measurement of fair values. This includes a valuation team that has overall responsibility for overseeing all significant fair value measurements, including Level 3 fair values.

When measuring the fair value of an asset or a liability, the Group uses market observable data as far as possible. Significant unobservable inputs and valuation adjustments are regularly reviewed and changes in fair value measurements from period to period are analysed.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

· Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

· Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

· Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

If the inputs used to measure the fair value of an asset or a liability might be categorised in different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Group recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.

When applicable, further information about the assumptions made in measuring fair values is included in the notes specific to that asset or liability.

f. Functional and presentation currency

These consolidated financial statements are presented in Euro (€), which is the Company's functional currency. All amounts have been rounded to the nearest thousand, unless otherwise indicated.

3. Determination of fair values

Properties

The fair value of investment property and land and buildings classified as property, plant and equipment is determined at the end of each reporting period. External, independent valuation companies, having appropriate recognised professional qualifications and recent experience in the location and category of the properties being valued, value the Group's properties at the end of each year and where necessary, semi-annually.

The Directors have appointed Colliers International, American Appraisal (Hellas) and PKF Consulting USA (the latter for 2015), three internationally recognised firms of surveyors, to conduct valuations of the Group's acquired properties to determine their fair value. These valuations are prepared in accordance with generally accepted appraisal standards, as set out by the American Society of Appraisers (the 'ASA'), and in conformity with the Uniform Standards of Professional Appraisal Practice of the Appraisal Foundation and the Principles of Appraisal Practice and Code of Ethics of the ASA and the Royal Institute of Chartered Surveyors ('RICS'). Furthermore, the valuations are conducted on an 'as is condition' and on an open market comparative basis.

The valuation analysis of properties is based on all the pertinent market factors that relate both to the real estate market and, more specifically, to the subject properties. The valuation analysis of a property typically uses four approaches: the cost approach, the direct sales comparison approach, the income approach and the residual value approach. The cost approach measures value by estimating the Replacement Cost New or the Reproduction Cost New of property and then determining the deductions for accrued depreciation that should be made to reflect the age, condition and situation of the asset during its past and proposed future economic working life. The direct sales comparison approach is based on the premise that persons in the marketplace buy by comparison. It involves acquiring market sales/offerings data on properties similar to the subject property. The prices of the comparables are then adjusted for any dissimilar characteristics as compared to the subject's characteristics. Once the sales prices are adjusted, they can be reconciled to estimate the fair value for the subject property. Based on the income approach, an estimate is made of prospective economic benefits of ownership. These amounts are discounted and/or capitalised at appropriate rates of return in order to provide an indication of value. The residual value approach is used for the valuation of the land and depends on two basic factors: the location and the total value of the buildings developed on a site. Under this approach, the residual value of the land is calculated by subtracting the development cost from the estimated sales value of the completed development.

Each of the above-mentioned valuation techniques results in a separate valuation indication for the subject property. Then a reconciliation process is performed to weigh the merits and limiting conditions of each approach. Once this is accomplished, a value conclusion is reached by placing primary weight on the technique, or techniques, that are considered to be the most reliable, given all factors.

Financial assets

The fair value of financial assets that are listed on a stock exchange is determined by reference to their quoted bid price at the reporting date. If the market for a financial asset is not active (and for unlisted securities), the Group establishes fair value by using valuation techniques. These include the use of recent arm's length transactions, reference to other instruments that are substantially the same and discounted cash flow analysis, making maximum use of market inputs and relying as little as possible on entity specific inputs. Equity investments for which fair values cannot be measured reliably are recognised at cost less impairment.

Trade and other receivables

The fair value of trade and other receivables, excluding construction work in process, is estimated as the present value of future cash flows, discounted at the market rate of interest at the reporting date.

Non-derivative financial liabilities

Fair value, which is determined for disclosure purposes, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date. For finance leases, the market rate of interest is determined by reference to similar lease agreements.

Equity-settled share-based payment arrangements

The fair value of equity-settled share-based payment arrangements are measured at grant date using the Trinomial Tree Option Pricing Model and Monte Carlo simulations. Service and non-market performance conditions attached to the arrangements are not taken into account in measuring fair value.

4. PRINCIPAL subsidiaries

As at 31 December 2016, the Group's most significant subsidiaries were the following:

		Country of	Shareholding
Name	Project	incorporation	interest
Scorpio Bay Holdings Limited	Scorpio Bay Resort	Cyprus	100%
Scorpio Bay Resorts S.A.	Scorpio Bay Resort	Greece	100%
Latirus Enterprises Limited	Sitia Bay Golf Resort	Cyprus	80%
Iktinos Techniki Touristiki S.A. ('Iktinos')	Sitia Bay Golf Resort	Greece	78%
Xscape Limited	Lavender Bay Resort	Cyprus	100%
Golfing Developments S.A.	Lavender Bay Resort	Greece	100%
MindCompass Overseas Limited	Kilada Hills Golf Resort	Cyprus	100%
MindCompass Overseas S.A.	Kilada Hills Golf Resort	Greece	100%
MindCompass Overseas Two S.A.	Kilada Hills Golf Resort	Greece	100%
MindCompass Parks S.A.	Kilada Hills Golf Resort	Greece	100%
Dolphin Capital Greek Collection Limited	Kilada Hills Golf Resort	Cyprus	100%
DCI Holdings One Limited ('DCI H1')	Aristo Developers	BVIs	100%
D.C. Apollo Heights Polo and Country Resort Limited	Apollo Heights Resort	Cyprus	100%
Symboula Estates Limited	Apollo Heights Resort	Cyprus	100%
DolphinCI Fourteen Limited ('DCI 14')	Amanzoe	Cyprus	100%
Eidikou Skopou Dekatessera S.A. ('ES 14')	Amanzoe	Greece	100%
Eidikou Skopou Dekaokto S.A. ('ES 18')	Amanzoe	Greece	100%
Single Purpose Vehicle Two Limited ('SPV 2')	Amanzoe	Cyprus	64%
Eidikou Skopou Eikosi Ena S.A.	Amanzoe	Greece	64%
Azurna Uvala D.o.o. ('Azurna')	Livka Bay Resort	Croatia	100%
Eastern Crete Development Company S.A.	Plaka Bay Resort	Greece	100%
DolphinLux 2 S.a.r.l.	La Vanta- Mediterra Resorts	Luxembourg	100%
Kalkan Yapi ve Turizm A.S. ('Kalkan')	La Vanta- Mediterra Resorts	Turkey	100%
Dolphin Capital Americas Limited	-	BVIs	100%
DCA Pearl Holdings Limited	Pearl Island	BVIs	100%
Single Purpose Vehicle Eight Limited	Triopetra	Cyprus	100%
Eidikou Skopou Dekapente S.A.	Triopetra	Greece	100%
Single Purpose Vehicle Ten Limited ('SPV 10')	Kea Resort	Cyprus	67%
Eidikou Skopou Eikosi Tessera S.A.	Kea Resort	Greece	67%
Pearl Island Limited S.A.	Pearl Island	Panama Republic	60%
Zoniro (Panama) S.A.	Pearl Island	Panama Republic	60%

The above shareholding interest percentages are rounded to the nearest integer.

As at 31 December 2016 and 31 December 2015, all or part of the shares held by the Company in some of its subsidiaries are pledged as a security for loans (see note 25).

5. Significant accounting policies

The principal accounting policies adopted in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all periods presented in these consolidated financial statements unless otherwise stated.

5.1 Subsidiaries

Subsidiaries are those entities, including special purpose entities, controlled by the Group. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

5.2 Transactions eliminated on consolidation

Intra-group balances and any unrealised gains and losses arising from intra-group transactions are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with associates are eliminated to the extent of the Group's interest in the entity. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.

5.3 Business combinations

Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which control is transferred to the Group. Control is the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. In assessing control, the Group takes into consideration potential voting rights that currently are exercisable.

The Group measures goodwill at the acquisition date as the fair value of the consideration transferred, plus the recognised amount of any non-controlling interests in the acquiree, plus if the business combination is achieved in stages, the fair value of the existing equity interest in the acquiree, less the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed.

When the excess is negative, a bargain purchase gain is recognised immediately in profit or loss. The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognised in profit or loss. Costs related to the acquisition, other than those associated with the issue of debt or equity securities, that the Group incurs in connection with a business combination are expensed as incurred. Any contingent consideration payable is recognised at fair value at the acquisition date. If the contingent consideration is classified as equity, it is not remeasured and settlement is accounted for within equity. Otherwise, subsequent changes to the fair value of the contingent consideration are recognised in profit or loss. The interest of non-controlling shareholders in the acquiree is initially measured at the non-controlling shareholders' proportion of the net fair value of the assets, liabilities and contingent liabilities recognised.

5.4 Interest in equity-accounted investees

Associates are those entities in which the Group has significant influence, but not control, over the financial and operating policies. Significant influence is presumed to exist when the Group holds between 20% and 50% of the voting power of another entity. Associates are accounted for using the equity method (equity accounted investees) and are initially recognised at cost. The Group's investment includes goodwill identified on acquisition, net of any accumulated impairment losses. The consolidated financial statements include the Group's share of the income and expenses and equity movements of equity accounted investees, after adjustments to align the accounting policies with those of the Group, from the date that significant influence commences until the date that significant influence ceases. When the Group's share of losses exceeds its interest in an equity accounted investee, the carrying amount of that interest (including any long-term investments) is reduced to nil and the recognition of further losses is discontinued except to the extent that the Group has an obligation or has made payments on behalf of the investee.

5.5 Investment property

Investment property is property held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of the business, use in the production or supply of goods or services or for administration purposes. Investment property is initially measured at cost and subsequently at fair value with any change therein recognised in profit or loss.

Cost includes expenditure that is directly attributable to the acquisition of the investment property. The cost of self-constructed investment property includes the cost of materials and direct labour, any other costs directly attributable to bringing the investment property to a working condition for their intended use and capitalised borrowing costs.

Any gain or loss on disposal of an investment property (calculated as the difference between the net proceeds from disposal and the carrying amount of the item) is recognised in profit or loss. When an investment property that was previously classified as property, plant and equipment is sold, any related amount included in the revaluation reserve is transferred to retained earnings.

When the use of property changes such that it is reclassified as property, plant and equipment, its fair value at the date of reclassification becomes its cost for subsequent accounting.

A property interest under an operating lease is classified and accounted for as an investment property on a property-by-property basis when the Group holds it to earn rentals or for capital appreciation or both. Any such property interest under an operating lease classified as an investment property is carried at fair value. Lease payments are accounted for as described in accounting policy 5.10.

5.6 Property, plant and equipment

Land and buildings are carried at fair value, based on valuations by external independent valuers, less subsequent depreciation for buildings. Revaluations are carried out with sufficient regularity such that the carrying amount does not differ materially from that which would be determined using fair value at the statement of financial position date. All other property, plant and equipment are stated at cost less accumulated depreciation and impairment losses.

Increases in the carrying amount arising on revaluation of property, plant and equipment are credited to fair value reserve in shareholders' equity. Decreases that offset previous increases of the same asset are charged against that reserve; all other decreases are recognised in profit or loss.

The cost of self-constructed assets includes the cost of materials, direct labour, the initial estimate, where relevant, of the costs of dismantling and removing the items and restoring the site on which they are located, and appropriate proportion of production overheads.

Depreciation charge is recognised in profit or loss on a straight-line basis over the estimated useful lives of items of property, plant and equipment, unless it constitutes part of the cost of another asset in which case is included in this asset's carrying amount. Freehold land is not depreciated.

The annual rates of depreciation are as follows:

Buildings 3%

Machinery and equipment 10% - 33.33%

Motor vehicles and other 10% - 20%

The Group recognises in the carrying amount of an item of property, plant and equipment the cost of replacing part of such an item when that cost is incurred if it is probable that the future economic benefits embodied with the item will flow to the Group and the cost of the item can be measured reliably. All other costs are recognised in profit or loss as incurred.

5.7 Assets held for sale

Non-current assets, or disposal groups comprising assets and liabilities, are classified as held for sale if it is highly probable that they will be recovered primarily through sale rather than through continuing use.

Such assets, or disposal groups, are generally measured at the lower of their carrying amount and fair value less costs to sell. Any impairment loss on a disposal group is allocated first to goodwill, and then to the remaining assets and liabilities on a pro rata basis. Impairment losses on initial classification as held for sale and subsequent gains and losses on re-measurement are recognised in profit or loss.

Once classified as held for sale, property, plant and equipment is no longer depreciated, and any equity-accounted investee is no longer equity accounted.

5.8 Trading properties

Trading properties (inventory) are shown at the lower of cost and net realisable value. Net realisable value is the estimated selling price in the ordinary course of the business less the estimated costs of completion and the estimated costs necessary to make the sale. Cost of trading properties is determined on the basis of specific identification of their individual costs and represents the fair value paid at the date that the land was acquired by the Group.

5.9 Work in progress

5.10 Leased assets

Leases under the terms of which the Group assumes substantially all the risks and rewards of ownership are classified as finance leases. Property held under operating leases that would otherwise meet the definition of investment property may be classified as investment property on a property-by-property basis. Such property is accounted for as if it were a finance lease and the fair value model is used for the asset recognised. Minimum lease payments on finance leases are apportioned between the finance charge and the reduction of the outstanding liability. The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.

5.11 Trade and other receivables

Trade and other receivables are stated at their cost less impairment losses (see accounting policy 5.22).

5.12 Financial assets

The classification of the Group's investments in equity securities depends on the purpose for which the investments were acquired. Management determines the classification of investments at initial recognition and re-evaluates this designation at every statement of financial position date.

Available-for-sale financial assets

Investments intended to be held for an indefinite period of time, which may be sold in response to needs for liquidity or changes in interest rates, are classified as available for sale. These are included in non-current assets unless management has the express intention of holding the investment for less than 12 months from the reporting date or unless they will need to be sold to raise operating capital, in which case they are included in current assets. Unrealised gains and losses arising from changes in the fair value of available-for-sale financial assets are recognised in other comprehensive income and then in equity. When available-for-sale financial assets are sold or impaired, the accumulated fair value adjustments are included in profit or loss. In respect of available-for-sale equity securities, impairment losses previously recognised in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognised in other comprehensive income and accumulated under the heading of fair value reserve.

5.13 Cash and cash equivalents

Cash and cash equivalents comprise cash deposited with banks and bank overdrafts repayable on demand. Cash equivalents are short-term, highly-liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value. Bank overdrafts that are repayable on demand and form an integral part of the Group's cash management are included as a component of cash and cash equivalents for the purpose of the consolidated statement of cash flows.

5.14 Share capital and premium

Share capital represents the issued amount of shares outstanding at their par value. Any excess amount of capital raised is included in share premium. External costs directly attributable to the issue of new shares, other than on a business combination, are shown as a deduction, net of tax, in share premium from the proceeds. Share issue costs incurred directly in connection with a business combination are included in the cost of acquisition.

5.15 Own shares

When share capital recognised as equity is repurchased, the amount of the consideration paid, which includes directly attributable costs, net of any tax effects, is recognised as a reduction from equity. Repurchased shares are classified as own shares and are presented as a reduction from total equity. When own shares are sold or reissued subsequently, the amount received is recognised as an increase in equity, and the resulting surplus or deficit on the transaction is transferred to share premium.

5.16 Dividends

Dividends are recognised as a liability in the period in which they are declared and approved and are subtracted directly from retained earnings.

5.17 Interest-bearing borrowings

Interest-bearing borrowings are recognised initially at fair value, less attributable transaction costs. Subsequent to initial recognition, interest-bearing borrowings are stated at amortised cost with any difference between cost and redemption value being recognised in profit or loss over the period of the borrowings on an effective interest basis.

5.18 Trade and other payables

Trade and other payables are stated at their cost.

5.19 Prepayments from clients

Payments received in advance on development contracts for which no revenue has been recognised yet, are recorded as prepayments from clients as at the statement of financial position date and carried under creditors. Payments received in advance on development contracts for which revenue has been recognised, are recorded as prepayments from clients to the extent that they exceed revenue that was recognised in profit or loss as at the statement of financial position date.

5.20 Provisions

A provision is recognised in the consolidated statement of financial position when the Group has a legal or constructive obligation as a result of a past event, and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.

5.21 Expenses

Investment Manager remuneration, directors' remuneration, operational expenses, professional fees, administrative and other expenses are accounted for on an accrual basis. Expenses are charged to profit or loss, except for expenses incurred on the acquisition of an investment property, which are included within the cost of that investment. Expenses arising on the disposal of an investment property are deducted from the disposal proceeds.

5.22 Impairment

The carrying amounts of the Group's assets, other than investment property (see accounting policy 5.5) and deferred tax assets (see accounting policy 5.32), are reviewed at each statement of financial position date to determine whether there is any indication of impairment. If any such indication exists, the assets' recoverable amount is estimated. The recoverable amount is the greater of the net selling price and value in use of an asset. In assessing value in use of an asset, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

An impairment loss is recognised whenever the carrying amount of an asset or its cash-generating unit exceeds its recoverable amount. Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of cash-generating units are allocated first to reduce the carrying amount of any goodwill allocated to cash-generating units and then, to reduce the carrying amount of the other assets in the unit on a pro rata basis.

5.23 Discontinued operation

A discontinued operation is a component of the Group's business, the operations and cash flows of which can be clearly distinguished from the rest of the Group. A discontinued operation has either been disposed of, or is classified as held for sale, and:

(a) represents a separate major line of business or geographical area of operations;

(b) is part of a single co-ordinated plan to dispose of a separate major line of business or geographical area of operation; or

When an operation is classified as a discontinued operation, the comparative statement of profit or loss and other comprehensive income is re-presented as if the operation had been discontinued from the start of the comparative year.

5.24 Revenue recognition

Revenue comprises the invoiced amount for the sale of goods and services net of value added tax, rebates and discounts. Revenues earned by the Group are recognised on the following bases:

Income from land and buildings under development

The Group applies IAS 18 'Revenue' for income from land and buildings under development, according to which revenue and the related costs are recognised in profit or loss when the building has been completed and delivered and all associated risks have been transferred to the buyer.

Construction contracts

Where the outcome of a construction contract can be estimated reliably, revenue and costs are recognised by reference to the stage of completion of the contract activity at the statement of financial position date, as measured by the proportion that contract costs incurred for work performed to date compared to the estimated total contract costs, except where this would not be representative of the stage of completion. Variations in contract work, claims and incentive payments are included to the extent that they have been agreed with the customer.

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred that it is probable they will be recoverable. Contract costs are recognised as expenses in the period in which they are incurred. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

5.25 Equity-settled share-based payment arrangements

The grant-date fair value of equity-settled share-based arrangements is generally recognised as an expense, with a corresponding increase in equity, over the vesting period of the awards. The grant-date fair value is measured to reflect market performance conditions and there is no true-up for differences between expected and actual outcomes. The amount recognised as an expense, is adjusted to reflect the number of awards for which the related service and non-market performance conditions are expected to be met, such that the amount ultimately recognised is based on the number of awards that meet the related service and non-market performance conditions at the vesting date. For share-based payment awards with non-vesting conditions, the grant-date fair value is measured to reflect such conditions and there is no true-up for differences between expected and actual outcomes.

5.26 Finance income and costs

Finance income comprises interest income on funds invested, dividend income and gains on the disposal of and increase in the fair value of financial assets at fair value through profit or loss. Interest income is recognised as it accrues in profit or loss, using the effective interest method.

Finance costs comprise interest expense on borrowings, unwinding of the discount on provisions and losses on the disposal of and reduction in the fair value of financial assets at fair value through profit or loss.

The interest expense component of finance lease payments is recognised in profit or loss using the effective interest method.

5.27 Foreign currency translation

Transactions in foreign currencies are translated to the respective functional currencies of Group entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the exchange rate at that date. The foreign currency gain or loss on monetary items is the difference between amortised cost in the functional currency at the beginning of the period, adjusted for effective interest and payments during the period, and the amortised cost in foreign currency translated at the exchange rate at the end of the period. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined. Foreign currency differences arising on retranslation are recognised in profit or loss.

5.28 Foreign operations

The assets and liabilities of foreign operations, including goodwill and fair value adjustments arising on acquisition, are translated to Euro at exchange rates at the reporting date. The income and expenses of foreign operations, excluding foreign operations in hyperinflationary economies, are translated to Euro at exchange rates at the dates of the transactions.

The income and expenses of foreign operations in hyperinflationary economies are translated to Euro at the exchange rate at the reporting date. Prior to translating the financial statements of foreign operations in hyperinflationary economies, their financial statements for the current period are restated to account for changes in the general purchasing power of the local currency. The restatement is based on relevant price indices at the reporting date.

Foreign currency differences are recognised directly in equity in the foreign currency translation reserve. When a foreign operation is disposed of, in part or in full, the relevant amount in the foreign currency translation reserve is transferred to profit or loss.

5.29 Segment reporting

A segment is a distinguishable component of the Group that is engaged either in providing products or services (operating segment), or in providing products or services within a particular economic environment (geographical segment), which is subject to risks and rewards that are different from those of other segments. Segment results that are reported to the Group's chief operating decision maker include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

5.30 Earnings per share

The Group presents basic and diluted (if applicable) earnings per share ('EPS') data for its shares. Basic EPS is calculated by dividing the profit or loss attributable to shareholders of the Company by the weighted average number of shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to shareholders and the weighted average number of shares outstanding for the effects of all dilutive potential shares.

5.31 NAV per share

The Group presents NAV per share by dividing the total equity attributable to owners of the Company by the number of shares outstanding as at the statement of financial position date.

5.32 Taxation

Taxation comprises current and deferred tax. Taxation is recognised in profit or loss, except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantially enacted at the statement of financial position date, and any adjustment to tax payable in respect of previous years.

Deferred tax is recognised using the statement of financial position method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit, and differences relating to investments in subsidiaries and jointly controlled entities to the extent that it is probable that they will not reverse in the foreseeable future. In addition, deferred tax is not recognised for taxable temporary differences arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously.

A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which the temporary difference can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

In determining the amount of current and deferred tax, the Group takes into account the impact of uncertain tax positions and whether additional taxes and interest may be due. This assessment relies on estimates and assumptions and may involve a series of judgements about future events. New information may become available that causes the Group to change its judgement regarding the adequacy of existing tax liabilities; such changes to the tax liabilities will impact tax expense in the period that such a determination is made.

5.33 Government grants

Government grants are recognised when there is reasonable assurance that the Group will comply with the conditions attaching to them and that the grants will be received. Government grants related to non-current assets are recognised as deferred income that is recognised in profit or loss on a systematic basis over the useful life of the asset. Government grants that relate to expenses are recognised in profit or loss as revenue.

5.34 Comparatives

Where necessary, comparative figures have been adjusted to conform to changes in presentation in the current year.

6. revenue

	From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Continuing operations	Discontinued operation	Total	Continuing operations	Discontinued operation	Total
				(Restated)	(Restated)	(Restated)
	€'000	€'000	€'000	€'000	€'000	€'000
Income from hotel operations	11,498	4,354	15,852	10,291	524	10,815
Income from operation of golf courses	-	126	126	-	155	155
Income from construction contracts	-	1,032	1,032	2,273	3,427	5,700
Sale of trading and investment properties	6,223	3,614	9,837	34,629	-	34,629
Rental income	56	-	56	329	-	329
Other income	371	1,478	1,849	158	120	278
Total	18,148	10,604	28,752	47,680	4,226	51,906

7. COST OF SALES

	From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Continuing operations	Discontinued operation	Total	Continuing operations	Discontinued operation	Total
				(Restated)	(Restated)	(Restated)
	€'000	€'000	€'000	€'000	€'000	€'000
Cost of sales related to:
Hotel operations	4,046	2,145	6,191	3,513	484	3,997
Golf course operations	-	144	144	-	470	470
Construction contracts	-	-	-	2,486	661	3,147
Sales of trading and investment properties	5,257	1,735	6,992	29,926	-	29,926
Commission to agents and other	384	-	384	358	-	358
Electricity and fuel	97	10	107	80	227	307
Personnel expenses (see below)	5,592	3,500	9,092	5,508	3,467	8,975
Branding management fees	1,585	661	2,246	3,552	-	3,552
Other operating expenses	396	25	421	1,356	320	1,676
Total	17,357	8,220	25,577	46,779	5,629	52,408

Personnel expenses

Continuing operations

	From 1 January 2016 to 31 December 2016
	Hotel & leisure operations	Project maintenance & development	Total
	€'000	€'000	€'000
Wages and salaries	3,858	493	4,351
Compulsory social security contributions	948	103	1,051
Other personnel costs	167	23	190
Total	4,973	619	5,592
The average number of employees employed by the Group during the year was	172	25	197

Discontinued operation

	From 1 January 2016 to 31 December 2016
	Hotel & leisure operations	Project maintenance & development	Total
	€'000	€'000	€'000
Wages and salaries	842	1,514	2,356
Compulsory social security contributions	95	559	654
Other personnel costs	367	123	490
Total	1,304	2,196	3,500
The average number of employees employed by the Group during the year was	134	104	238

Continuing operations

	From 1 January 2015 to 31 December 2015
	Hotel & leisure operations	Project maintenance & development	Total	Construction in progress
	(Restated)	(Restated)	(Restated)	(Restated)
	€'000	€'000	€'000	€'000
Wages and salaries	3,369	772	4,141	74
Compulsory social security contributions	832	160	992	3
Contributions to defined contribution plans	-	29	29	-
Other personnel costs	155	191	346	-
Total	4,356	1,152	5,508	77
The average number of employees employed by the Group during the year was	140	37	177	2

Discontinued operation

	From 1 January 2015 to 31 December 2015
	Hotel & leisure operations	Project maintenance & development	Total	Construction in progress
	(Restated)	(Restated)	(Restated)	(Restated)
	€'000	€'000	€'000	€'000
Wages and salaries	541	1,710	2,251	-
Compulsory social security contributions	59	640	699	-
Contributions to defined contribution plans	-	-	-	-
Other personnel costs	267	250	517	-
Total	867	2,600	3,467	-
The average number of employees employed by the Group during the year was	89	120	209	-

Personnel expenses in relation to operating expenses are expensed as incurred in profit or loss. Personnel expenses in relation to construction in progress are capitalised on the specific projects and transferred to profit or loss through cost of sales when the specific property is disposed of.

8. INCOME AND EXPENSES

A. DISPOSAL OF INVESTMENTS

		From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Note	Continuing operations	Discontinued operation	Total	Continuing operations	Discontinued operation	Total
					(Restated)	(Restated)	(Restated)
		€'000	€'000	€'000	€'000	€'000	€'000
Gain/(loss) on disposal of investment in subsidiaries	33	634	(24,566)	(23,932)	823	-	823
Gain on disposal of investment in equity-accounted investees	21	151	-	151	-	-	-
Total		785	(24,566)	(23,781)	823	-	823

B. CHANGE IN VALUATIONS

		From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Note	Continuing operations	Discontinued operation	Total	Continuing operations	Discontinued operation	Total
					(Restated)	(Restated)	(Restated)
		€'000	€'000	€'000	€'000	€'000	€'000
Net change in fair value of investment property	17	(22,126)	(42,458)	(64,584)	(53,163)	8,116	(45,047)
Impairment loss on trading properties	19	(724)	-	(724)	(3,431)	-	(3,431)
Impairment loss on re-measurement of disposal groups	18	(4,197)	-	(4,197)	(763)	-	(763)
Impairment loss on equity-accounted investees	21	(109,265)	-	(109,265)	-	-	-
Impairment loss on available-for-sale financial assets	20	-	(995)	(995)	-	-	-
Reversal of (impairment loss) and write offs of property, plant and equipment	16	92	-	92	(1,898)	(13,349)	(15,247)
Concession/write off of land		(292)	-	(292)	(2,607)	-	(2,607)
Total		(136,512)	(43,453)	(179,965)	(61,862)	(5,233)	(67,095)

9. SEGMENT REPORTING

Operating segments

The Group has two reportable operating segments, the 'Hotel & leisure operations' and 'Construction & development' segments. Information related to each operational reportable segment is set out below. Segment profit/(loss) before tax is used to measure performance as management believes such information is the most relevant in evaluating the results of the respective segments relative to other entities that operate in the same industries.

	Hotel & leisure operations			Construction & development			Other			Reportable segments' totals
	Continuing operations	Discontinued operation	Continuing operations		Discontinued operation	Continuing operations		Discontinued operation	Continuing operations		Discontinued operation
	€'000	€'000	€'000		€'000	€'000		€'000	€'000		€'000
31 December 2016
Revenue	11,498	4,480	6,237		6,038	413		86	18,148		10,604
Cost of sales	(10,458)	(4,254)	(6,273)		(3,933)	(626)		(33)	(17,357)		(8,220)
Investment Manager remuneration	-	-	-		-	(11,406)		-	(11,406)		-
Directors' remuneration	-	-	-		-	(1,509)		-	(1,509)		-
Depreciation charge	(2,269)	(117)	(15)		(379)	-		-	(2,284)		(496)
Professional fees	-	-	(210)		(1,920)	(5,270)		(118)	(5,480)		(2,038)
Administrative and other expenses	-	-	(234)		(1,003)	(1,998)		(504)	(2,232)		(1,507)
Gain/(loss) on disposal of investments in subsidiaries	-	(24,566)	(563)		-	1,197		-	634		(24,566)
Gain on disposal of investments in equity-accounted investees	-	-	151		-	-		-	151		-
Net change in fair value of investment property	-	-	-		-	(22,126)		(42,458)	(22,126)		(42,458)
Ιmpairment loss on trading properties	-	-	(724)		-	-		-	(724)		-
Impairment loss on re-measurement of disposal groups	(666)	-	(1,496)		-	(2,035)		-	(4,197)		-
Ιmpairment loss on equity accounted investees	-	-	(109,265)		-	-		-	(109,265)		-
Ιmpairment loss on available-for-sale financial assets	-	-	-		-	-		(995)			(995)
Reversal of (impairment loss) and write offs of property, plant and equipment	238	-	-		-	(146)		-	92		-
Concession/write off of land	-	-	-		-	(292)		-	(292)		-
Results from operating activities	(1,657)	(24,457)	(112,392)		(1,197)	(43,798)		(44,022)	(157,847)		(69,676)
Finance income	-	-	-		-	29		13,557	29		13,557
Finance costs	(2,903)	-	(3,007)		(2,399)	(9,189)		(23)	(15,099)		(2,422)
Net finance (costs)/income	(2,903)	-	(3,007)		(2,399)	(9,160)		13,534	(15,070)		11,135
Share of losses on equity-accounted investees, net of tax	-	-	(34,389)		-	-		-	(34,389)		-
Loss before taxation	(4,560)	(24,457)	(149,788)		(3,596)	(52,958)		(30,488)	(207,306)		(58,541)
Taxation	-	-	(1,546)		1,273	5,130		-	3,584		1,273
Loss	(4,560)	(24,457)	(151,334)		(2,323)	(47,828)		(30,488)	(203,722)		(57,268)

	Hotel & leisure operations		Construction & development		Other		Reportable segments' totals
	Continuing operations	Discontinued operation	Continuing operations	Discontinued operation	Continuing operations	Discontinued operation	Continuing operations	Discontinued operation
	€'000	€'000	€'000	€'000	€'000	€'000	€'000	€'000
31 December 2015 (Restated)
Revenue	10,291	679	37,223	3,427	166	120	47,680	4,226
Cost of sales	(8,959)	(1,821)	(35,971)	(3,339)	(1,849)	(469)	(46,779)	(5,629)
Investment Manager remuneration	-	-	-	-	(13,128)	-	(13,128)	-
Directors' remuneration	-	-	-	-	(904)	-	(904)	-
Depreciation charge	(2,227)	(238)	(14)	-	-	(440)	(2,241)	(678)
Professional fees	-	-	(981)	(1,772)	(3,892)	(1,519)	(4,873)	(3,291)
Administrative and other expenses	-	-	(2,258)	-	(2,874)	(968)	(5,132)	(968)
Gain on disposal of investments in subsidiaries	-	-	823	-	-	-	823	-
Net change in fair value of investment property	-	-	-	-	(53,163)	8,116	(53,163)	8,116
Impairment loss on trading properties	-	-	(3,431)	-	-	-	(3,431)	-
Impairment loss on measurement of disposal groups	(76)	-	-	-	(687)	-	(763)	-
Impairment loss and write offs of property, plant and equipment	(1,113)	(13,349)	-	-	(785)	-	(1,898)	(13,349)
Concession/write off of land	-	-	(2,607)	-	-	-	(2,607)	-
Results from operating activities	(2,084)	(14,729)	(7,216)	(1,684)	(77,116)	4,840	(86,416)	(11,573)
Finance income	1	-	-	1	86	18	87	19
Finance costs	(2,682)	-	(1,750)	(2,868)	(13,299)	(256)	(17,731)	(3,124)
Net finance costs	(2,681)	-	(1,750)	(2,867)	(13,213)	(238)	(17,644)	(3,105)
Share of profit on equity-accounted investees, net of tax	(1,011)	-	(43,542)	-	-	-	(44,553)	-
Loss before taxation	(5,776)	(14,729)	(52,508)	(4,551)	(90,329)	4,602	(148,613)	(14,678)
Taxation	-	-	633	-	14,726	(63)	15,359	(63)
Loss	(5,776)	(14,729)	(51,875)	(4,551)	(75,603)	4,539	(133,254)	(14,741)

Geographical segments

Information in relation to the geographical regions in which the Group operates, is set below:

	Americas¹ (Discontinued) €'000	South-East Europe² €'000	Other³ €'000	Reportable segment totals €'000	Adjustments⁴ €'000	Consolidated totals €'000
31 December 2016
Property, plant and equipment	-	87,647	-	87,647	-	87,647
Investment property	-	176,548	-	176,548	-	176,548
Trading properties	-	29,763	-	29,763	-	29,763
Cash and cash equivalents	-	3,415	1,283	4,698	-	4,698
Assets held for sale	55,909	106,526	-	162,435	-	162,435
Intra-group debit balances	15,277	51,899	589,489	656,665	(656,665)	-
Other assets	-	4,681	316	4,997	-	4,997
Total assets	71,186	460,479	591,088	1,122,753	(656,665)	466,088
Loans and borrowings	-	92,270	-	92,270	-	92,270
Finance lease liabilities	-	2,982	-	2,982	-	2,982
Deferred tax liabilities	-	24,255	-	24,255	-	24,255
Liabilities held for sale	10,800	16,397	-	27,197	-	27,197
Intra-group credit balances	170,031	425,771	60,863	656,665	(656,665)	-
Other liabilities	-	64,678	2,826	67,504	-	67,504
Total liabilities	180,831	626,353	63,689	870,873	(656,665)	214,208
Revenue	-	18,148	-	18,148	-	18,148
Cost of sales	-	(17,357)	-	(17,357)	-	(17,357)
Disposal of investments	-	785	-	785	-	785
Change in valuations	-	(136,512)	-	(136,512)	-	(136,512)
Share of losses on equity-accounted investees, net of tax	-	(34,389)	-	(34,389)	-	(34,389)
Investment Manager remuneration	-	(1,390)	(10,016)	(11,406)	-	(11,406)
Other operating expenses	-	(6,172)	(5,333)	(11,505)	-	(11,505)
Net finance cost	-	(11,466)	(3,604)	(15,070)	-	(15,070)
Loss before taxation	-	(188,353)	(18,953)	(207,306)	-	(207,306)
Taxation	-	3,584	-	3,584	-	3,584
Loss from continuing operations	-	(184,769)	(18,953)	(203,722)	-	(203,722)
Loss from discontinued operation, net of tax	(57,268)	-	-	(57,268)	-	(57,268)
Loss	(57,268)	(184,769)	(18,953)	(260,990)	-	(260,990)

	Americas¹ (Discontinued) €'000	South-East Europe² €'000	Other³ €'000	Reportable segment totals €'000	Adjustments⁴ €'000	Consolidated totals €'000
31 December 2015 (Restated)
Property, plant and equipment	102,920	84,095	-	187,015	-	187,015
Investment property	141,906	198,947	-	340,853	-	340,853
Trading properties	2,052	35,335	-	37,387	-	37,387
Equity-accounted investees	-	188,637	-	188,637	-	188,637
Available-for-sale financial assets	2,201	-	-	2,201	-	2,201
Cash and cash equivalents	2,117	6,218	33,655	41,990	-	41,990
Assets held for sale	-	70,240	-	70,240	-	70,240
Intra-group debit balances	14,195	291,448	555,516	861,159	(861,159)	-
Other assets	3,141	13,195	841	17,177	-	17,177
Total assets	268,532	888,115	590,012	1,746,659	(861,159)	885,500
Loans and borrowings	57,550	92,395	73,735	223,680	-	223,680
Finance lease liabilities	28	3,005	-	3,033	-	3,033
Deferred tax liabilities	2,432	27,697	-	30,129	-	30,129
Liabilities held for sale	-	18,125	-	18,125	-	18,125
Intra-group credit balances	144,154	417,371	299,634	861,159	(861,159)	-
Other liabilities	27,865	65,260	880	94,005	-	94,005
Total liabilities	232,029	623,853	374,249	1,230,131	(861,159)	368,972
Revenue	-	47,680	-	47,680	-	47,680
Cost of sales	-	(46,779)	-	(46,779)	-	(46,779)
Disposal of investments	-	823	-	823	-	823
Change in valuations	-	(61,862)	-	(61,862)	-	(61,862)
Share of losses on equity-accounted investees, net of tax	-	(44,553)	-	(44,553)	-	(44,553)
Investment Manager remuneration	-	(2,032)	(11,096)	(13,128)	-	(13,128)
Other operating expenses	-	(8,888)	(4,262)	(13,150)	-	(13,150)
Net finance costs	-	(12,826)	(4,818)	(17,644)	-	(17,644)
Loss before taxation	-	(128,437)	(20,176)	(148,613)	-	(148,613)
Taxation	-	15,359	-	15,359	-	15,359
Loss from continuing operations	-	(113,078)	(20,176)	(133,254)	-	(133,254)
Loss from discontinued operation, net of tax	(14,741)	-	-	(14,741)	-	(14,741)
Loss	(14,741)	(113,078)	(20,176)	(147,995)	-	(147,995)

1 Americas comprises the Group's activities in the Dominican Republic and the Republic of Panama. Also, includes the investment in Itacare Capital Investments Ltd ('Itacare') (see note 20).

2 South-East Europe comprises the Group's activities in Cyprus, Greece, Croatia and Turkey.

3 Other comprises the parent company, Dolphin Capital Investors Limited.

4 Adjustments consist of intra-group eliminations.

Country risk developments

The general economic environment prevailing in the south-east Europe area and internationally may affect the Group's operations. Factors such as inflation, unemployment, public health crises, international trade and development of the gross domestic product directly impact to the economy of each country and variation in these and the economic environment in general affect the Group's performance to a certain extent.

The global fundamentals of the sector remained strong during 2016, with both international tourism and wealth continuing to grow, even though economic activity in two of the Group's primary markets, Greece and Cyprus, continued to face significant challenges. The business climate is steadily improving in Cyprus, assisted by the legislative reforms implemented during the last two years by the Cypriot Government.

Greece

After the escalation of the sovereign debt crisis in Greece in mid-2012 and further in mid-June 2015, when capital controls were imposed and the banking system was closed for more than two weeks, on 15 July 2015, the Greek parliament ratified legislation of reforms that the Greek Government needed to implement in order to unlock a fresh €82 billion to €86 billion bail-out package. The conclusion of this agreement and its implementation by the Greek Government so far is expected to restore the sustainability of the Greek economy on a long term basis. Throughout 2016 the Greek economic growth has been essentially flat. However, the tourism sector has continued to outperform with official data released by the Greek Tourism Confederation confirming that 2016 was an all-time record year for Greek tourism as the number of tourism arrivals in Greece increased 9% compared to 2015.

The outlook to 2017 remains positive and 2017 tourism revenues are expected to reach €14.5 billion (US$15.36 billion) compared to €13.2 billion (US$13.99 billion) in 2016.

Cyprus

Cyprus successfully concluded its three-year European Stability Mechanism ('ESM') financial assistance programme on 31 March 2016. The ESM disbursed €6.3 billion, in addition to around €1 billion in loans from the IMF, out of a loan package of up to €10 billion. The Cypriot authorities did not need the remaining €2.7 billion.

The latest available data for the tourism industry highlighted, once again, that tourism was amongst one of the key catalysts to the country's 2016 economic performance, as revenues reached €2.4 billion at the end of the year surpassing the total tourism revenues recorded throughout 2015 (€2.1 million) by 11.9%. Total arrivals amounted to 3.2 million in 2016 versus 2.7 million in the previous year. Cyprus expects to hit another record number of tourists during 2017, with visits to the east Mediterranean island expected to increase 5% over last year.

Significant value is also estimated to be unlocked through the expected zoning of DCI's Apollo Heights Resort, following the agreement reached by the Cypriot and UK governments to permit development of such projects falling within the Sovereign British Areas.

10. DISCONTINUED OPERATION

In 2016, the Group sold Playa Grande (owner of 'Amanera, Dominican Republic'), and Group's management committed to a plan to sell Pearl (owner of 'Pearl Island, Republic of Panama'). Playa and Pearl constitute the operations of the Group in the geographical area of Americas which are presented as a discontinued operation. Pearl group is also classified as a disposal group held for sale.

Americas segment was not previously classified as held for sale or as a discontinued operation. The comparative consolidated statement of profit or loss and other comprehensive income has been restated to show the discontinued operation separately from continuing operations.

Results of discontinued operation

		From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
			(Restated)
	Note	€'000	€'000
Revenue	6	10,604	4,226
Expenses
Cost of sales	7	(8,220)	(5,629)
Change in valuations	8B	(43,453)	(5,233)
Depreciation charge	16	(496)	(678)
Professional fees	11	(2,038)	(3,291)
Administrative and other expenses	12	(1,507)	(968)
Net finance income/(costs)	13	11,135	(3,105)
Results from operating activities		(33,975)	(14,678)
Taxation	14	1,273	(63)
Results from operating activities, net of tax		(32,702)	(14,741)
Loss on disposal of discontinued operation	8A	(24,566)	-
Loss from discontinued operation, net of tax		(57,268)	(14,741)

Cash flows used in discontinued operation

	From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
	€'000	€'000
Net cash (used in)/from operating activities	(57,452)	13,047
Net cash from/(used in) investing activities	60,394	(40,222)
Net cash (used in)/from financing activities	(4,945)	6,418
Net cash flows for the year	(2,003)	(20,757)

11. PROFESSIONAL FEES

	From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Continuing operations	Discontinued operation	Total	Continuing operations	Discontinued operation	Total
				(Restated)	(Restated)	(Restated)
	€'000	€'000	€'000	€'000	€'000	€'000
Legal fees	940	73	1,013	722	70	792
Auditors' remuneration (see below)	683	30	713	756	54	810
Accounting expenses	294	6	300	287	7	294
Appraisers' fees	92	-	92	140	-	140
Project design and development fees	1,863	1,008	2,871	1,494	2,877	4,371
Consultancy fees	741	86	827	142	52	194
Administrator fees	117	26	143	308	-	308
Other professional fees	750	809	1,559	1,024	231	1,255
Total	5,480	2,038	7,518	4,873	3,291	8,164

	From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Continuing operations	Discontinued operation	Total	Continuing operations	Discontinued operation	Total
				(Restated)	(Restated)	(Restated)
	€'000	€'000	€'000	€'000	€'000	€'000
Auditors' remuneration comprises the following fees:
Audit and other audit related services	650	30	680	714	43	757
Tax and advisory	33	-	33	42	11	53
Total	683	30	713	756	54	810

12. ADMINISTRATIVE AND OTHER EXPENSES

	From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Continuing operations	Discontinued operation	Total	Continuing operations	Discontinued operation	Total
				(Restated)	(Restated)	(Restated)
	€'000	€'000	€'000	€'000	€'000	€'000
Travelling and accommodation	432	85	517	461	90	551
Insurance	122	32	154	113	154	267
Repairs and maintenance	83	56	139	123	-	123
Marketing and advertising expenses	281	164	445	435	368	803
Litigation liability provisions	-	-	-	2,039	-	2,039
Immovable property and other taxes	467	-	467	645	-	645
Rents	189	156	345	238	147	385
Site housing expenses	-	601	601	-	24	24
Other	658	413	1,071	1,078	185	1,263
Total	2,232	1,507	3,739	5,132	968	6,100

13. NET Finance costS

	From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Continuing operations	Discontinued operation	Total	Continuing operations	Discontinued operation	Total
				(Restated)	(Restated)	(Restated)
	€'000	€'000	€'000	€'000	€'000	€'000
Recognised in profit or loss
Interest income	29	1	30	87	19	106
Exchange difference	-	13,556	13,556	-	-	-
Finance income	29	13,557	13,586	87	19	106
Interest expense	(12,928)	(2,386)	(15,314)	(16,632)	(3,068)	(19,700)
Bank charges	(571)	(36)	(607)	(438)	(55)	(493)
Exchange difference	(1,600)	-	(1,600)	(661)	(1)	(662)
Finance costs	(15,099)	(2,422)	(17,521)	(17,731)	(3,124)	(20,855)
Net finance (costs)/income recognised in profit or loss	(15,070)	11,135	(3,935)	(17,644)	(3,105)	(20,749)

	From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
	€'000	€'000
Recognised in other comprehensive income
Foreign currency translation differences	(7,458)	17,221
Finance (costs)/income recognised in other comprehensive income	(7,458)	17,221

14. Taxation

	From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
		(Restated)
	€'000	€'000
RECOGNISED IN PROFIT OR LOSS
TAXATION ON CONTINUING OPERATIONS
Income tax	(26)	55
Net deferred tax	(3,558)	(15,414)
Taxation recognised in profit or loss - continuing operations	(3,584)	(15,359)
TAXATION ON DISCONTINUED OPERATION
Income tax	-	17
Net deferred tax	(1,273)	46
Taxation recognised in profit or loss - discontinued operation	(1,273)	63
Total	(4,857)	(15,296)
RECOGNISED IN OTHER COMPREHENSIVE INCOME
Revaluation of property, plant and equipment (see note 26)	1,682	(1,791)
Taxation recognised in other comprehensive income	1,682	(1,791)

Reconciliation of taxation based on taxable loss and taxation based on accounting loss:

	From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
		(Restated)
	€'000	€'000
Loss before taxation	(207,306)	(148,613)
Taxation using domestic tax rates	(13,470)	(25,305)
Effect of valuation loss on properties	(3,017)	(18,283)
Non-deductible expenses	8,252	22,140
Tax-exempt income	(591)	(2,158)
Current year losses for which no deferred tax is recognised	5,334	4,839
Effect of tax losses utilised	(6)	(259)
Effect of tax rate changes	-	3,715
Effect of losses surrendered to group companies	(19)	(10)
Other	(67)	(38)
Total	(3,584)	(15,359)

As a company incorporated under the BVI International Business Companies Act (Cap. 291), the Company is exempt from taxes on profits, income or dividends. Each company incorporated in BVI is required to pay an annual government fee, which is determined by reference to the amount of the company's authorised share capital.

The profits of the Cypriot companies of the Group are subject to a corporation tax rate of 12.50% on their total taxable profits. Tax losses of Cypriot companies are carried forward to reduce future profits for a period of five years. In addition, the Cypriot companies of the Group are subject to a 3% special contribution on rental income. Under certain conditions, interest income may be subject to a special contribution at the rate of 30%. In such cases, this interest is exempt from corporation tax.

In Greece, the corporation tax rate applicable to profits is 29%. Tax losses of Greek companies are carried forward to reduce future profits for a period of five years. In Turkey, the corporation tax rate is 20%. Tax losses of Turkish companies are carried forward to reduce future profits for a period of five years. In Croatia, the corporation tax rate is 20%. Effective from 1 January 2017, the corporation tax rate will be 18%. Tax losses of Croatian companies are carried forward to reduce future profits for a period of five years.

The Group's subsidiary in the Dominican Republic, which was disposed of during the year 2016, has been granted a 100% exemption on local and municipal taxes by the Dominican Republic's Confotur (Tourism Promotion Council), for a period of fifteen years, effective from the finalisation of the construction of the project. In the Republic of Panama, the corporation tax rate is 25% and the capital gains tax rate is 10%. The Panamanian tax legislation further contemplates a method of taxation which involves a 3% advance on the tax, which is not calculated on the actual gain, but on the total value of the transfer or on the registered value of the property (whichever may be higher). In some instances, this 3% may be considered by the taxpayer as the final tax payable. Tax losses of companies in the Republic of Panama are carried forward to reduce future profits for a period of five years.

15. LOSS per share

Basic loss per share

Basic loss per share is calculated by dividing the loss attributable to owners of the Company by the weighted average number of common shares outstanding during the year.

	From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Continuing operations	Discontinued operation	Total		Continuing operations	Discontinued operation	Total
					(Restated)	(Restated)	(Restated)
	'000	'000	'000		'000	'000	'000
Loss attributable to owners of the Company (€)	(203,363)	(40,399)	(243,762)		(131,133)	(14,227)	(145,360)
Number of weighted average common shares outstanding	904,627	904,627	904,627		788,860	788,860	788,860
Basic loss per share (€)	(0.22)	(0.05)	(0.27)		(0.16)	(0.02)	(0.18)

Loss attributable to owners of the Company

	From 1 January 2016 to 31 December 2016			From 1 January 2015 to 31 December 2015
	Continuing operations	Discontinued operation	Total	Continuing operations	Discontinued operation	Total
				(Restated)	(Restated)	(Restated)
	€'000	€'000	€'000	€'000	€'000	€'000
Loss attributable to owners of the Company	(203,363)	(40,399)	(243,762)	(131,133)	(14,227)	(145,360)
Loss attributable to non-controlling interests	(359)	(16,869)	(17,228)	(2,121)	(514)	(2,635)
Total	(203,722)	(57,268)	(260,990)	(133,254)	(14,741)	(147,995)

Weighted average number of common shares outstanding

	From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
		(Restated)
	'000	'000
Outstanding common shares at the beginning of the year	904,627	642,440
Effect of shares issued during the year	-	122,544
Effect of Bond Conversion shares	-	23,876
Weighted average number of common shares outstanding	904,627	788,860

Diluted loss per share

Diluted loss per share is calculated by adjusting the loss attributable to owners and the number of common shares outstanding to assume conversion of all dilutive potential shares. As of 31 December 2016 and 31 December 2015, the diluted loss per share is the same as the basic loss per share, due to the fact that no dilutive potential ordinary shares were outstanding during these years.

The average market value of the Company's shares for the purpose of calculating the dilutive effect of warrants and Convertible Bonds was based on quoted market prices. The Convertible Bonds were repaid on scheduled maturing date in March 2016 and all warrants expired on 3 January 2017.

16. Property, plant and equipment

	Under construction €'000	Land & buildings €'000	Machinery & equipment €'000	Other €'000	Total €'000
2016
Cost or revalued amount
At beginning of year	12,227	176,426	28,421	2,088	219,162
Direct acquisitions	1,041	153	1,794	81	3,069
Direct disposals	-	(576)	(146)	(780)	(1,502)
Disposals through disposal of subsidiary companies (see note 33)	-	(69,101)	(23,742)	(478)	(93,321)
Reclassification to assets held for sale	(2,294)	(20,291)	(5,076)	(103)	(27,764)
Transfers to trading property (see note 19)	-	(2,266)	(252)	-	(2,518)
Transfer (to)/from other assets	(11,311)	8,078	3,233	-	-
Revaluation adjustment	-	5,796	-	-	5,796
Exchange difference	337	1,342	362	7	2,048
At end of year	-	99,561	4,594	815	104,970
Depreciation and impairment losses
At beginning of year	-	26,126	4,620	1,401	32,147
Direct disposals	-	-	(121)	(728)	(849)
Disposals through disposal of subsidiary companies (see note 33)	-	(12,363)	(2,377)	(281)	(15,021)
Reclassification to assets held for sale	-	(1,420)	(275)	(55)	(1,750)
Transfer to trading property (see note 19)	-	-	(103)	-	(103)
Depreciation charge for the year-continuing operations	-	1,614	532	138	2,284
Depreciation charge for the year - discontinued operation	-	358	132	6	496
Impairment loss	-	780	-	-	780
Reversal of impairment loss	-	(872)	-	-	(872)
Exchange difference	-	158	48	5	211
At end of year	-	14,381	2,456	486	17,323
Carrying amounts	-	85,180	2,138	329	87,647
2015
Cost or revalued amount
At beginning of year	31,273	146,826	13,687	2,506	194,292
Direct acquisitions	35,483	2,156	4,856	78	42,573
Direct disposals	-	(35)	(367)	(661)	(1,063)
Disposals through disposal of subsidiary company (see note 33)	-	(1,578)	(3)	-	(1,581)
Reclassification to assets held for sale	-	(5,343)	(162)	-	(5,505)
Transfers to trading property (see note 19)	-	-	(198)	-	(198)
Transfer (to)/from other assets	(58,131)	48,492	9,639	-	-
Revaluation adjustment	-	(15,181)	-	-	(15,181)
Write offs - discontinued operation	-	(1,513)	-	-	(1,513)
Exchange difference	3,602	2,602	969	165	7,338
At end of year	12,227	176,426	28,421	2,088	219,162
Depreciation and impairment losses
At beginning of year	-	12,102	4,041	1,384	17,527
Direct disposals	-	-	(338)	(412)	(750)
Disposals through disposal of subsidiary company (see note 33)	-	(156)	(3)	-	(159)
Reclassification to assets held for sale	-	(10)	(65)	-	(75)
Transfer to trading property (see note 19)	-	-	(104)	-	(104)
Depreciation charge for the year-continuing operations	-	1,611	487	143	2,241
Depreciation charge for the year - discontinued operation	-	321	217	140	678
Impairment loss	-	1,898	-	-	1,898
Impairment loss - discontinued operation	-	12,252	17	-	12,269
Write offs - discontinued operation	-	(433)	-	-	(433)
Exchange difference	-	(1,459)	368	146	(945)
At end of year	-	26,126	4,620	1,401	32,147
Carrying amounts	12,227	150,300	23,801	687	187,015

The carrying amount at year end of land and buildings, if the cost model was used, would have been €79 million (2015: €132 million).

As at 31 December 2016 and 31 December 2015, part of the Group's immovable property is held as security for bank loans (see note 25).

Fair value hierarchy

The fair value of land and buildings, amounting to €85,180 thousand (2015: €150,300 thousand), has been categorised as a Level 3 fair value based on the inputs to the valuation techniques used.

The following table shows a reconciliation from opening to closing balances of Level 3 fair value.

	31 December 2016	31 December 2015
	€'000	€'000
At beginning of year	150,300	134,724
Acquisitions	153	2,156
Disposals	(57,314)	(1,457)
Transfers from other assets	5,812	48,492
Reclassification to assets held for sale	(18,871)	(5,333)

Losses recognised in profit or loss
Reversal of (impairment loss) and write offs in 'Change in valuations'	92	(1,898)
Impairment loss and write offs in 'Loss from discontinued operation, net of tax'	-	(13,332)
Depreciation in 'Depreciation charge'	(1,614)	(1,611)
Depreciation in 'Loss from discontinued operation, net of tax'	(358)	(321)

Losses recognised in comprehensive income
Revaluation adjustment in 'Revaluation on property, plant and equipment'	5,796	(15,181)
Unrealised exchange difference in 'Foreign currency translation differences'	1,184	4,061
At end of year	85,180	150,300

The following table shows the valuation techniques used in measuring land and buildings, as well as the significant unobservable inputs used.

During 2015, the valuation technique used in measuring the fair value of properties in Greece and the Americas changed to Income approach or an approach combining Income approach, in cases where the property construction was fully completed or nearly completed in the year and hence, more reliance could have been placed on cash flow data.

Property location	Valuation technique (see note 3)	Significant unobservable inputs		Inter-relationship between key unobservable inputs and fair value measurement
Property in Greece - Resorts	Income approach	Room occupancy rate (annual):	2016: 21% to 62%	The estimated fair value would increase/(decrease) if:
			(weighted average: 26%-60%)
			(2015: 20% to 57% )	Room occupancy rate was higher/(lower);
			(weighted average: 26%-56%)	Average daily rate per occupied room was higher/(lower);
		Average daily rate per occupied room:	2016: €399 to €1,742	Gross operating margin was higher/(lower);
			(weighted average: €593-€1,471)	Terminal capitalisation rate was lower/(higher);
			(2015: €528 to €1,742)	Risk-adjusted discount rate was lower/(higher).
			(weighted average: €600-€1,470)
		Gross operating margin rate:	2016: 9% to 45%
			(weighted average: 36%-38%)
			(2015: 23% to 47% )
			(weighted average: 36%-44%)
		Terminal capitalisation rate:	2016: 8% (2015: 8%)
		Risk-adjusted discount rate:	2016: 11% to 12%
			(2015: 11% to 13%)
Property in Greece - Hotel complexes	Combined approach (Market and Cost)	Market approach (for land components)		The estimated fair value would increase/(decrease) if:
		Premiums/(discounts) on the following:		Premiums were higher/(lower);
		Location:	2016: -10% to 0%	Discounts were lower/(higher);
			(2015: -20% to 0%)	Weights on comparables with premiums were higher/(lower);
		Asking vs transaction:	2016: -30% to -10%	Weights on comparables with discounts were lower/(higher);
			(2015: -25% to -15%)	Replacement cost (new) per m² was higher/(lower);
		Frontage sea view:	2016: 0% to +20%	Enterpreneurial profit rate was higher/(lower);
			(2015: 0% to +20%)	Depreciation rate was lower/(higher).
		Maturity/development potential:	2016: 0% to +10%
			(2015: 0% to +10%)
		Weight allocation:	2016: +10% to +15%
			(2015: +10% to +20% )
		Cost approach (for building components)
		Replacement cost (new) per m²:	2016: €500 - €1,100
			(2015: €500 - €1,100)
		Enterpreneurial profit rate:	2016: 20% (2015: 20%)
		Depreciation rate:	2016: 32% (2015: 30%)
		Useful life (years):	2016: 60 (2015: 60)
	Combined approach (Market and Income)	Market approach		The estimated fair value would increase/(decrease) if:
		Premiums/(discounts) on the following:		Premiums were higher/(lower);
		Location:	2016: 0%	Discounts were lower/(higher);
			(2015: -20% to +30%)	Weights on comparables with premiums were higher/(lower);
		Site size:	2016: -20% to +10%	Weights on comparables with discounts were lower/(higher);
			(2015: -20% to +10%)	Room occupancy rate was higher/(lower);
		Asking vs transaction:	2016: -20% to 0%	Average daily rate per occupied room was higher/(lower);
			(2015: -20% to 0%)	Gross operating margin was higher/(lower);
		Frontage sea view:	2016: 0% to +10%	Terminal capitalisation rate was lower/(higher);
			(2015: 0%)	Risk-adjusted discount rate was lower/(higher)..
		Maturity/development potential:	2016: -50% to 0%
			(2015: -50% to 0%)
		Premium due to being part of strategic investment:	2016: 15% (2015: 15%)
		Weight allocation:	2016: +10% to +40%
			(2015: +10% to +60%)
		Cost approach
		Room occupancy rate (annual):	2016: 18% to 33%
			(weighted average: 30%)
			(2015: 18% to 33%)
			(weighted average: 30%)
		Average daily rate per occupied room:	2016: €1,305 to €1,700
			(weighted average: €1,538)
			(2015: €1,305 to €1,700)
			(weighted average: €1,538)
		Gross operating margin rate:	2016: 9% to 37%
			(weighted average: 33%)
			(2015: 9% to 37%)
			(weighted average: 33%)
		Terminal capitalisation rate:	2016: 8% (2015: 8%)
		Risk-adjusted discount rate:	2016: 11% (2015: 11%)

Property location	Valuation technique (see note 3)	Significant unobservable inputs		Inter-relationship between key unobservable inputs and fair value measurement
Property in Americas - Resort and golf course	Income approach	Room occupancy rate (annual):	2015: 36% to 48% (weighted average: 39%)	The estimated fair value would increase/(decrease) if:
		Average daily rate per occupied room:	2015: $1,314 to $2,463 (weighted average: $2,062)	Occupancy rate was higher/(lower);
		Gross operating margin rate:	2015: 3% to 46% (weighted average: 38%)	Average daily rate per occupied room was higher/(lower);
		Terminal capitalisation rate:	2015: 9%	Gross operating margin was higher/(lower);
		Risk-adjusted discount rate:	2015: 11%	Terminal capitalisation rate was lower/(higher);
				Risk-adjusted discount rate was lower/(higher).
		Annual membership dues per member:	2015: $8,400 to $10,960 (weighted average: $9,600)	The estimated fair value would increase/(decrease) if:
		Membership initiation fees per member:	2015: $60,000	Membership fees per member were higher/(lower);
		Gross operating margin rate:	2015: 30% to 53% (weighted average: 43%)	Gross operating margin was higher/(lower);
		Terminal capitalisation rate:	2015: 11%	Terminal capitalisation rate was lower/(higher);
		Risk-adjusted discount rate:	2015: 13%	Risk-adjusted discount rate was lower/(higher).

17. Investment property

	Note	31 December 2016	31 December 2015
		€'000	€'000
At beginning of year		340,853	451,880
Direct acquisitions		11	1,064
Direct disposals		-	(756)
Disposals through disposal of subsidiary companies	33	(74,644)	(10,979)
Transfers to trading properties	19	(273)	(14,290)
Reclassification to assets held for sale		(28,135)	(52,507)
Concession/write off of land	8B	-	(2,607)
Exchange difference		3,320	14,095
Fair value adjustment - continuing operations	8B	(22,126)	(53,163)
Fair value adjustment - discontinued operation	8B	(42,458)	8,116
At end of year		176,548	340,853

As at 31 December 2016 and 31 December 2015, part of the Group's immovable property is held as security for bank loans (see note 25).

Changes in fair values are recognised as gains/(losses) in profit or loss and included in 'Change in valuations' or 'Loss from discontinued operation, net of tax' if they relate to the discontinued operation. All such gains/(losses) are unrealised. Concession/write off of land is included in 'Changes in valuations'. Exchange differences are unrealised, recognised in comprehensive income and included in 'Foreign currency translation differences'.

Fair value hierarchy

The fair value of investment property, amounting to €176,548 thousand (2015: €340,853 thousand), has been categorised as a Level 3 fair value based on the inputs to the valuation techniques used.

Valuation techniques and significant unobservable inputs

The following table shows the valuation techniques used in measuring the fair value of investment property, as well as the significant unobservable inputs used.

During 2015, the valuation technique used in measuring the fair value of properties in Greece and the Americas changed to Income approach, in cases where there was significant improvement in the level of completion of the relevant projects.

Property location			Valuation technique (see note 3)	Significant unobservable inputs		Inter-relationship between key unobservable inputs and fair value measurement
Property in Greece		Income approach		Room occupancy rate (annual):	2016: 29% to 42%	The estimate fair value would increase/(decrease) if:
					(weighted average: 38%)	Occupancy rate was higher/(lower);
					(2015: 29% to 42%)	Average daily rate per occupied room was higher/(lower);
					(weighted average: 38%)	Gross operating margin was higher/(lower);
				Average daily rate per occupied room:	2016: €823 to €1,708	Terminal capitalisation rate was (lower)/higher;
					(weighted average €1,455)	Quantity of villas was higher/(lower);
					(2015: €818 to €1,723 )	Selling price per m² was higher/(lower);
					(weighted average €1,432)	Expected annual growth in selling price was higher/(lower);
				Gross operating margin rate:	2016: 12% to 35%	Cash flow velocity was shorter/(longer);
					(weighted average 28%)	Risk-adjusted discount rate was lower/(higher).
					(2015: 16% to 33%)
					(weighted average 29%)
				Terminal capitalisation rate:	2016: 10% (2015: 10%)
				Quantity of villas:	2016: 35 (2015: 35)
				Selling price per m²:	2016: €5,500 to €6,000
					(2015: €5,500 to €6,000)
				Expected annual growth in selling price:	2016: 0% to 5%
					(2015: 0% to 5%)
				Cash flow velocity (years):	2016: 8 (2015: 6)
				Risk-adjusted discount rate:	2016: 12% (2015: 13%)
	Combined approach (Market and Income)			Market approach - 60% weight (2015: 60%)		The estimated fair value would increase/(decrease) if:
				Premiums/(discounts) on the following:		Premiums were higher/(lower);
				Location:	2016: -10% to +10%	Discounts were lower/(higher);
					(2015: 0% to +10%)	Weights on comparables with premiums were higher/(lower);
				Site size:	2016: -20% to 0%)	Weights on comparables with discounts were lower/(higher);
					(2015: -30% to 0%)	Quantity of villas was higher/(lower);
				Asking vs transaction:	2016: -30% to -10%	Selling price per m² was higher/(lower);
					(2015: -30% to 0%)	Expected annual growth in selling price was higher/(lower);
				Frontage sea view:	2016: 0% to +30%	Cash flow velocity was shorter/(longer);
					(2015: 0% to +20%)	Risk-adjusted discount rate was lower/(higher).
				Maturity/development potential:	2016: -20% to +30%
					(2015: +10% to +30%)
				Weight allocation:	2016: +10% to +20%
					(2015: +5% to +30%)
				Income approach - 40% weight (2015: 40%)
				Quantity of villas:	2016: 447 (2015: 447)
				Selling price per m²:	2016: €2,900
					(2015: €3,000)
				Expected annual growth in selling price:	2016: 0% to 3%
					(2015: 0% to 3%)
				Cash flow velocity (years):	2016: 13 (2015: 11)
				Risk-adjusted discount rate:	2016: 15% (2015:15%)
				Discount on combined approach value:
				Legal status	2016: -10% (2015: -10%)

Property location	Valuation technique (see note 3)	Significant unobservable inputs		Inter-relationship between key unobservable inputs and fair value measurement
	Market approach	Premiums/(discounts) on the following:		The estimated fair value would increase/(decrease) if:
		Location:	2016: -40% to +40%	Premiums were higher/(lower);
			(2015: -50% to +40%)	Discounts were lower/(higher);
		Site size:	2016: -50% to +10%	Weights on comparables with premiums were higher/(lower);
			(2015: -50% to +10%)	Weights on comparables with discounts were lower/(higher).
		Asking vs transaction:	2016: -30% to -5%
			(2015: -30% to 0%)
		Frontage sea view:	2016: -10% to +30%
			(2015: -20% to +40%)
		Maturity/development potential:	2016: -45% to +40%
			(2015: -30% to +35%)
		Zoning uniqueness:	2016: -30% to 0%
			(2015: -30% to +40%)
		Other:	2016: -10% to 0% (2015: -10% to 0%)
		Strategic investment approval:	2016: 0% to +25%
			(2015: 0% to +25%)
		Weight allocation:	2016: +5% to +40%
			(2015: +5% to +40%)
Property in Cyprus	Market approach	Premiums/(discounts) on the following:		The estimated fair value would increase/(decrease) if:
Property in Cyprus	Market approach	Location:	2016: -10% to +20%	Premiums were higher/(lower);
			(2015: -10% to +20%)	Discounts were lower/(higher);
		Site size:	2016: -30% to -10%	Weights on comparables with premiums were higher/(lower);
			(2015: -30% to -20%)	Weights on comparables with discounts were lower/(higher).
		Asking vs transaction:	2016: -30% to 0%
			(2015: -20% to 0%)
		Frontage sea view:	2016: 0% to +30%
			(2015: 0% to +30%)
		Maturity/development potential:	2016: -30% (2015: -30%)
		Weight allocation:	2016: +10% to +20%
			(2015: +5% to +25%)
Property in Americas	Income approach	Quantity of villas/ condominiums/ lots :	2015: 30 to 42	The estimated fair value would increase/(decrease) if:
		Selling price per buildable sq. ft:	2015: $600 to $775	Quantities of villas and/or condominiums and/or lots was higher/(lower);
		Average selling price per lot sq. ft:	2015: $19	Selling price per buildable sq. ft was higher/(lower);
		Expected annual growth in selling price :	2015: 0%	Average selling price per sq. ft was higher/(lower);
		Cash flow velocity (years):	2015: 5 to 8	Expected annual growth in selling price was higher/ (lower);
		Risk-adjusted discount rate:	2015: 15% to 25%	Cash-flow velocities were shorter/(longer) ;
				Risk-adjusted discount rate was lower/(higher).
	Market approach	Premiums/(discounts) on the following:		The estimated fair value would increase/(decrease) if:
		Location:	2015: 0% to +20%	Premiums were higher/(lower);
		Site size:	2015: -50% to +25%	Discounts were lower/(higher);
		Asking vs transaction:	2015: -35%	Weights on comparables with premiums were higher/(lower);
		Frontage sea view:	2015: -25% to +15%	Weights on comparables with discounts were lower/(higher).
		Development potential:	2015: Nil
		Condition quality:	2015: -10% to +15%

18. DISPOSAL GROUPS HELD FOR SALE

In 2016, the Company committed to the sale of two properties and their associated liabilities, through the sale of their holding companies. Accordingly, the assets and liabilities of each of these holding companies are presented as separate disposal groups held for sale. The disposal groups are: Pearl (owner of 'Pearl Island') in the Republic of Panama and DCI Holdings Two Limited ('DCI H2') (owner of Aristo Developers Limited ('Aristo') in Cyprus. Pearl is part of the discontinued geographical operation of Americas and is also included in the operating segments of 'Construction & development' and 'Other'. DCI H2 is included in the geographical segment of 'South-East Europe' and in the operating segment of 'Construction & development'. Efforts to sell the disposal groups have commenced and their sale has either been completed or expected to be completed within 2017.

The Company also remains committed to its plan commenced in 2015 to sell four additional disposal groups which are presented as separate disposal groups held for sale. These disposal groups are: Iktinos (owner of 'Sitia Bay') and Porto Heli (owner of 'Nikki Beach') in Greece, Azurna (owner of 'Livka Bay') in Croatia and Kalkan (owner of 'La Vanta') in Turkey. All of the disposal groups are included in the geographical segment of 'South-East Europe' and in the operating segments of 'Hotel & Leisure operations' (Porto Heli), 'Construction & Development' (Kalkan) and 'Other' (Iktinos and Azurna) operating segments.

Impairment losses relating to the disposal group

Impairment losses of €4,197 thousand (2015: €763 thousand) for write-downs of the disposal groups to the lower of their carrying amount and their fair value less costs to sell have been recognised and included in Other Expenses (see note 8B).

Assets and liabilities of disposal groups held for sale

	Iktinos disposal group	Azurna disposal group	Kalkan disposal group	Porto Heli disposal group	DCI H2 disposal group	Pearl disposal group	Total
	€'000	€'000	€'000	€'000	€'000	€'000	€'000
Property, plant and equipment	6,699	-	23	-	-	26,014	32,736
Investment property	14,541	32,937	-	-	-	28,135	75,613
Equity-accounted investees	-	-	-	783	43,391	-	44,174
Trading properties	-	-	6,850	-	-	-	6,850
Trade and other receivables	-	7	1,269	-	-	627	1,903
Cash and cash equivalents	11	8	7	-	-	183	209
	21,251	32,952	8,149	783	43,391	54,959	161,485
Available-for-sale financial assets (see note 20)	-	-	-	-	-	-	950
Assets held for sale							162,435
Loans and borrowings	-	8,165	94	-	-	-	8,259
Deferred tax liabilities	3,062	3,633	-	-	-	1,239	7,934
Trade and other payables	274	959	210	-	-	9,561	11,004
Liabilities held for sale	3,336	12,757	304	-	-	10,800	27,197

As at 31 December 2015, the disposal groups comprised the following assets and liabilities:

	Iktinos disposal group	Azurna disposal group	Kalkan disposal group	Porto Heli disposal group	Total
	€'000	€'000	€'000	€'000	€'000
Property, plant and equipment	4,439	-	23	-	4,462
Investment property	17,901	34,606	-	-	52,507
Equity-accounted investees	-	-	-	1,450	1,450
Deferred tax assets	-	-	1,628	-	1,628
Trading properties	-	-	7,960	-	7,960
Trade and other receivables	-	9	1,459	-	1,468
Cash and cash equivalents	86	282	397	-	765
Assets held for sale	22,426	34,897	11,467	1,450	70,240
Loans and borrowings	-	8,162	538	-	8,700
Deferred tax liabilities	3,380	4,405	25	-	7,810
Trade and other payables	252	970	393	-	1,615
Liabilities held for sale	3,632	13,537	956	-	18,125

Cumulative income or expenses included in other comprehensive income

An amount of €5,720 thousand (2015: €182 thousand) relating to the disposal groups, is included in other comprehensive income.

Measurement of fair values

i. Fair value hierarchy

The fair value measurement for the disposal groups before costs to sell has been categorised as a Level 3 fair value based on the inputs to the valuation techniques used.

ii. Valuation techniques and significant unobservable inputs

The fair value of each disposal group is significantly based on the valuation of the immovable property in each group. The following table shows the valuation techniques and significant unobservable inputs used in measuring the fair values of Iktinos, Azurna, Kalkan and Porto Heli properties. The fair values of Pearl and DCI H2 properties are based on selling agreements signed for their disposal.

Property	Valuation technique (see note 3)	Significant unobservable inputs
Iktinos, Greece	Combined approach (Market and Income)	Market approach (50% weight)
		Premiums/(discounts) on the following:
		Location:	2016: -30% to +30% (2015: -30% to +30%)
		Site size:	2016: -20% to 0% (2015: -20% to 0%)
		Asking vs transaction:	2016: -30% to -20% (2015:-30% to -15%)
		Frontage sea view:	2016: -20% to +15% (2015: 0% to +15%)
		Maturity/development potential:	2016: +20% to +90% (2015:+20% to +90%)
		Weight allocation:	2016: +15% to +30% (2015:+20% to +30%)
		Income approach (50% weight)
		Quantity of villas:	2016: 102 (2015:102)
		Selling price per m²:	2016: €2,400 (2015:€2,600)
		Expected annual growth in selling price:	2016: 0% to 3% (2015:0% to 6%)
		Cash flow velocity (years):	2016: 7 (2015: 7)
		Risk-adjusted discount rate:	2016: 13% (2015: 13%)
	Income approach	Room occupancy rate (annual):	2016: 32% to 46%) (weighted average: 43%)
			(2015: 32% to 46%) (weighted average: 43%)
		Average daily rate per occupied room:	2016: €372 to €496 (weighted average: €452)
			(2015: €372 to €496 (weighted average: €452)
		Gross operating margin rate:	2016: 5% to 40% (weighted average: 34%)
			(2015: 5% to 40% (weighted average: 34%)
		Terminal capitalisation rate:	2016: 9% (2015: 9%)
		Risk-adjusted discount rate:	2016: 13% (2015: 13%)
	Market approach	Premiums/(discounts) on the following:
		Location:	2016: -30% to +30% (2015: -30% to +30%)
		Site size:	2016: -20% to 0% (2015: -20% to 0%)
		Asking vs transaction:	2016: -30% to -10% (2015: -30% to -15%)
		Frontage sea view:	2016: -20% to +20% (2015: 0% to +15%)
		Maturity/development potential:	2016: -20% to +50% (2015: -20% to +50%)
		Weight allocation:	2016: +5% to +30% (2015: +15% to +30%)

Property	Valuation technique (see note 3)	Significant unobservable inputs
Azurna, Croatia	Market approach	Premiums/(discounts) on the following:
		Location:	2016: 0% to +5% (2015: 0%)
		Site size:	2016: -20% to -3% (2015: 0%)
		Asking vs transaction:	2016: -10% to 0% (2015: -10% to 0%)
		Weight allocation:	2016: +17% to +28% (2015: +15% to +50%)
Kalkan, Turkey	Income approach	Quantity of residential units:	2016: 1 to 54 (2015: 1 to 54)
	Income approach	Selling price per m²:	2016: €1,100 to €1,850 (2015: €1,050 to €2,050)
		Expected annual growth in selling price:	2016: 0% to 5% (2015: 0% to 5%)
		Cash flow velocity (years):	2016: 1 to 3 (2015: 1 to 3)
		Risk-adjusted discount rate:	2016: 5% to 38% (2015: 5% to 40%)
Porto Heli, Greece	Income approach	Room occupancy rate (annual):	2016: 25% to 35% (weighted average: 33%) (2015: 30% to 40% (weighted average: 38%)
Porto Heli, Greece	Income approach	Average daily rate per occupied room:	2016: €265 to €369 (weighted average: €330) (2015: €232 to €403 (weighted average: €339)
		Gross operating margin rate:	2016: 17% to 36% (weighted average: 32%) (2015: 18% to 43% (weighted average: 37%)
		Terminal capitalisation rate:	2016: 10% (2015: 10%)
		Risk-adjusted discount rate:	2016: 11% (2015: 12%)

19. Trading properties

	Note	31 December 2016	31 December 2015
		€'000	€'000
At beginning of year		37,387	52,323
Net direct disposals		(3,200)	(16,189)
Concession/write off of land		(193)	-
Net transfers from investment property	17	273	14,290
Net transfers from property, plant and equipment	16	2,415	94
Disposals through disposal of subsidiary companies	33	(6,205)	(1,952)
Impairment loss	8B	(724)	(3,431)
Reclassification to assets held for sale		-	(7,960)
Exchange difference		10	212
At end of year		29,763	37,387

As at 31 December 2016 and 31 December 2015, part of the Group's immovable property is held as security for bank loans(see note 25).

20. AVAILABLE-FOR-SALE FINANCIAL ASSETS

On 15 July 2013, the Company acquired 9.6 million shares, equivalent to 10% of Itacare's share capital, for the amount of €1.9 million. Itacare is a real estate investment company that was listed on AIM until 16 May 2014, when the admission of its ordinary shares to trading on AIM was cancelled following a decision of its shareholders at the Extraordinary General Meeting that took place on 6 May 2014. Itacare's shareholders have decided to dispose of all assets and after a series of asset sales/swaps Itacare now owns two development sites with the Company's shareholding being 13%. The Company is currently in advanced discussions for the sale of its shareholding in Itacare, for a US$1 million payment in cash, with the transaction expected to close in mid-2017.

	31 December 2016	31 December 2015
	€'000	€'000
At beginning of year	2,201	2,201
Change in fair value	(256)	-
Impairment loss (see note 8B)	(995)	-
Reclassification to assets held for sale (see note 18)	(950)	-
At end of year	-	2,201

Fair value hierarchy

The fair value of this available-for-sale financial asset has been categorised as Level 3 at the fair value hierarchy.

21. equity-accounted investees

	DCI H2	Progressive Business Advisors S.A.	Porto Heli	Total
	€'000	€'000	€'000	€'000
Balance as at 1 January 2016	188,637	-	-	188,637
Share of losses, net of tax	(34,389)	-	-	(34,389)
Impairment loss (see note 8B)	(109,265)	-	-	(109,265)
Disposals	(950)	-	-	(950)
Share of revaluation reserve	17	-	-	17
Reclassification to assets held for sale	(44,050)	-	-	(44,050)
Balance as at 31 December 2016	-	-	-	-
Balance as at 1 January 2015	231,972	24	2,227	234,223
Additions	-	-	310	310
Disposals	-	(24)	-	(24)
Share of translation reserve	180	-	-	180
Share of losses, net of tax	(43,542)	-	(1,011)	(44,553)
Share of revaluation reserve	27	-	-	27
Reclassification to assets held for sale	-	-	(1,526)	(1,526)
Balance as at 31 December 2015	188,637	-	-	188,637

The details of the above investments, as at 31 December 2016 are as follows:

	Principal place of business/Country		Shareholding interest
Name	of incorporation	Principal activities	2016	2015
DCI H2	BVIs	Acquisition and holding of investments in Cyprus	49%	50%
Porto Heli	BVIs	Acquisition and holding of investments in Greece	25%	25%

The above shareholding interest percentages are rounded to the nearest integer.

During 2016, the Company's investment in DCI H2, owner of Aristo Developers Limited ('Aristo'), decreased significantly, as a result of a share of loss and an impairment loss amounting to €34,389 thousand and €109,265 thousand, respectively. The share of losses comprises the result of the loan restructuring arrangement between Aristo and Bank of Cyprus, whereby a loss from the redemption of such bank loans emerged through their settlement with property swapped. The impairment loss has been recognised to bring the DCI H2 investment to its recoverable amount of €45 million, which represents the agreed proceeds of the Company from the disposal of its investment, as further described below.

On 29 September 2016, the Company reached an agreement to dispose of its 49.75% shareholding in DCI H2 to an entity controlled by Theodoros Aristodemou ('TA'), DCI H2' s current controlling shareholder. The disposal would be effected by way of a sale to TA of 49.75% of the shares in DCI H2 held by DCI Holdings One Ltd, a wholly-owned subsidiary of the Company, for a total cash consideration of €45 million, payable in quarterly instalments over three years and bearing annual interest of 4% in the first year, increasing to 5% and 6%, respectively, for each of the subsequent years. The Company would also be entitled to a 25% share of any gross proceeds in excess of an implied company equity valuation of €100 million from the sale of any shares of DCI H2 (or of its subsidiaries) sold by the acquirer until the earlier of six months from the settlement of the full consideration (to the extent such settlement occurred by 29 December 2016 and the second anniversary from the transaction). The acquisition shares would be kept in escrow and transferred to the acquirer in line with the collection of the consideration by the Company, apart from a percentage which will remain escrowed until the final settlement of the consideration. In the event that any payment became overdue for more than three months either party would have the right to terminate the sales agreement, in which case all the shares kept in escrow together with any corresponding dividend distributions would be retained by the Company. On 6 September 2016, the Company received €1.1 million in exchange for 105 DCI H2 shares, resulting to a gain on disposal of €151 thousand and to a reduction in the Company's holding in DCI H2 to 48.7%.

On 13 February 2017, the Company signed a supplementary agreement amending the date of execution of the agreement to the earlier of a) 30 April 2017 and b) the 'Stay Period', the date falling 5 Business days after the issuance of the Court verdict for the current trial between the Attorney General and the Bank of Cyprus Ltd (in which TA is a defendant). Completion will take place upon the expiration of the Stay Period, subject to the full receipt by the Company of any outstanding amount from the consideration. Upon execution of this agreement an amount of €700 thousand was paid to the Company (received on 14 February 2017) in exchange for 77 shares in DCI H2. In the event that by 30 April 2017 a court verdict has not been issued, then the Stay Period shall be extended until 30 June of 2017, provided that TA makes by the 30 April 2017 a payment of €300 thousand in exchange for 33 DCIH2 shares.

As at 31 December 2016, the Company's holding of 48.7% has been classified as asset held for sale.

During 2015, the Company disposed of its participation in Progressive Business Advisors S.A. Also, on 24 April 2015, DCI Holdings Fifty Ltd ('DCI H50') acquired a 100% participation in SPV 5, through the enforcement of the pledge over the whole issued share capital of SPV 5 that existed in relation to a loan facility provided by DCI H50 to SPV 5 on 11 February 2014. As the Company has a 25% participation in DCI H50, its indirect holding in SPV 5 remains 25% at 31 December 2016. On 30 October 2015, there was a restructuring in the Nikki Beach corporate holding structure ('Porto Heli'), with Heli Bay replacing DCI H50 as the common holding company of the asset and Heli Bay Properties Ltd acting as the intermediate holding company in Cyprus. The Company retains its 25% indirect shareholding participation in the Porto Heli project which has not been affected by the above transactions.

Summary of financial information for equity-accounted investees as at and for the year ended 31 December 2015, not adjusted for the percentage ownership held by the Group:

	DCI H2	Porto Heli	Total
	€'000	€'000	€'000
2015
Current assets	227,368	5,630	232,998
Non-current assets	680,085	11,380	691,465
Total assets	907,453	17,010	924,463

Current liabilities	345,847	6,355	352,202
Non-current liabilities	181,734	4,551	186,285
Total liabilities	527,581	10,906	538,487

Net assets	379,872	6,104	385,976

Carrying amount of interest in associate	188,637	-	188,637

Revenues	21,860	2,170	24,030
Loss	(109,382)	(6,212)	(115,594)
Other comprehensive income	417	-	417
Total comprehensive income	(87,105)	(4,042)	(91,147)

Group's share of loss and total comprehensive income	(43,335)	(1,011)	(44,346)

22. trade and other RECEIVABLES

	31 December 2016	31 December 2015
	€'000	€'000
Trade receivables	863	7,482
VAT receivables	370	3,560
Other receivables	1,998	4,154
Total trade and other receivables (see note 35)	3,231	15,196
Prepayments and other assets	770	984
Total	4,001	16,180

	31 December 2016	31 December 2015
	€'000	€'000
Non-current	-	1,178
Current	4,001	15,002
Total	4,001	16,180

23. Cash and cash equivalents

	31 December 2016	31 December 2015
	€'000	€'000
Bank balances (see note 35)	4,669	41,948
Cash in hand	29	42
Total	4,698	41,990

During the period, the Group had no fixed deposits.

As at 31 December 2016, an amount of €3.2 million (2015: €4.1 million) received through the Colony Luxembourg S.a.r.l. loan facility is restricted for use only towards the development of the Amanzoe project. In addition, funds in bank accounts of certain Group companies are pledged as a security for loans (see note 25).

24. capital and reserves

Capital

Authorised share capital

	31 December 2016		31 December 2015
	'000 of shares	€'000	'000 of shares	€'000
Common shares of €0.01 each	2,000,000	20,000	2,000,000	20,000

Movement in share capital and premium

	Shares in	Share capital	Share premium
	'000	€'000	€'000
Capital at 1 January 2015	642,440	6,424	498,933
Shares issued on 9 June 2015	219,257	2,193	60,527
Placement costs	-	-	(1,464)
Bond conversion shares on 11 June 2015	42,930	429	11,851
Capital at 31 December 2015	904,627	9,046	569,847
Capital at 1 January 2016 and 31 December 2016	904,627	9,046	569,847

On 9 June 2015 and 11 June 2015, the Company issued 219,256,609 new common shares and 42,930,080 bond conversion shares, respectively, at GBP 0.21 per share, for a total value of €75 million. The new shares rank pari passu with the existing common shares of the Company.

Warrants

In December 2011, the Company raised €8.5 million through the issue of new shares at GBP 0.27 per share (with warrants attached to subscribe for additional Company shares equal to 25% of the aggregate value of the new shares at the price of GBP 0.3105 per share, subject to anti-dilution adjustments pursuant to the warrant's terms and conditions - initial price of GBP 0.35 per share). The warrants are exercisable within five years from the admission date. The number of shares to be issued on exercise of their rights will be determined based on the subscription price on the exercise date. All warrants expired on 3 January 2017.

Reserves

Translation reserve

Translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.

Fair value reserve

Fair value reserve comprises the cumulative net change in fair value of available-for-sale financial assets until the assets are derecognised or impaired, and the revaluation of property, plant and equipment from both subsidiaries and equity accounted investees, net of any deferred tax.

25. loans AND BORROWINGS

	Total		Within one year		Within two to five years		More than five years
	2016	2015	2016	2015	2016	2015	2016	2015
	€'000	€'000	€'000	€'000	€'000	€'000	€'000	€'000
Loans in euro	92,270	92,395	12,749	10,578	67,146	61,707	12,375	20,110
Loans in United States dollars	-	57,550	-	6,638	-	50,912	-	-
Convertible Bonds payable	-	73,735	-	15,312	-	58,423	-	-
	92,270	223,680	12,749	32,528	67,146	171,042	12,375	20,110
Loans in Euro within disposal groups held for sale	8,259	8,700	765	709	7,494	7,991	-	-
Total	100,529	232,380	13,514	33,237	74,640	179,033	12,375	20,110

Terms and Conditions

The terms and conditions of outstanding loans were as follows:

Description	Currency	Interest rate	Maturity dates	31 December 2016 €'000	31 December 2015 €'000
Secured loans	Euro	Euribor plus margins ranging from margins from 4.25% to 6.5% (2015: margins from 4.25% to 6.5%)	From 2018 to 2026 (2015: from 2018 to 2026)	58,065	41,744
Secured loans	Euro	Basic rate plus 1.5% margin	2022	-	16,443
Secured loans	Euro	Fixed rates ranging from 4.75% to 11% (2015: fixed rates from 7.9% to 11%)	From 2017 to 2020 (2015: from 2016 to 2020	42,464	42,908
Secured loans	United States Dollars	Libor plus margins ranging from 2% to 8%	From 2017 to 2020	-	57,550
Convertible Bonds payable	Euro	5.50%	2018	-	50,000
Convertible Bonds payable	United States Dollars	7%	From 2016 to 2018	-	23,735
Total interest-bearing liabilities				100,529	232,380

Securities

As at 31 December 2016 and 31 December 2015, the Group's loans and borrowings were secured as follows:

· Mortgage against the immovable property of the Croatian subsidiary, Azurna, with a carrying amount of €31.6 million (2015: €33.3 million), two promissory notes, a debenture note and a letter of support from its parent company Single Purpose Vehicle Four Limited.

· Mortgage against immovable property of the Turkish subsidiary, Kalkan Yapi ve Turizm A.S., with a carrying amount of €5.8 million (2015: €6.7 million).

· Mortgage against the immovable property of the Cypriot subsidiary, Symboula Estates Limited, with a carrying amount of €30.1 million (2015: €34.4 million).

· Mortgage against immovable property of the Cypriot associate, Aristo, amounting to €2.8 million.

· Lien up to €41.6 million on immovable properties of the Greek subsidiaries of the Porto Heli project, with a carrying amount of €139.8 million (2015: €149 million).

· Pledge of 1,000 shares of DCI H2 for Symboula Estates Limited bank loan (2015: pledge of 1,500 shares of DCI H2).

· Pledge of all shares of the Cypriot subsidiary Symboula Estates Limited, and all shares of two other Apollo group entities for Symboula Estates Limited bank loan (2015: nil).

· Pledge of 4,495 shares of the Cypriot subsidiary, DCI 14, and all shares of six Cypriot and Greek subsidiaries of Amanzoe project for DCI 14 loan received from Colony Luxembourg S.a.r.l. acting on behalf of managed funds.

· Fixed and floating charges over the rights, titles and interests of DCI 14 and three Cypriot subsidiaries of Amanzoe project, charge over their bank accounts and assignment of their intra-group receivables for the loan from Colony Luxembourg S.a.r.l.

· Fixed and floating charges overs assets and undertakings of Symboula Estates Limited, subordination and assignment of intercompany loans between all companies of Apollo Group and Dolphin Capital Investors Limited (2015: nil).

· Corporate guarantees by DCI Holdings One Limited for the serving of the bank loan of Cypriot subsidiary, Symboula Estates Limited, amounting to €16 million (2015: guarantee of €16 million).

As at 31 December 2015, in addition to the above, the Group's loans and borrowings were secured as follows:

· Mortgage against immovable property of the subsidiary in Dominican Republic, PGH, with a carrying amount of €34.8 million.

· Pledge of all shares of PGH, its subsidiary, Playa Grande Golf Resort Inc., and its parent, DCA Holdings Seven Limited for the loan received by DCA Holdings Seven Limited's parent, DCA Holdings Six Limited ('DCA H6'), from Melody Business Finance LLC, acting as administrative agent of a group of lenders.

· Pledge over the net loan proceeds related to the loan through Melody Business Finance LLC.

· Pledge over funds in bank accounts of PGH and its subsidiary, Playa Grande Golf Resort Inc., pledge over rights under insurance policies, conditioned assignment over operation and promissory notes for disbursements in connection with Playa Grande Golf Resort Inc. bank loan.

· Guarantee by Dolphin Capital Americas Limited, the parent of DCA H6, on the payment and performance of guaranteed obligations in connection with the loan from Melody Business Finance LLC.

· Corporate guarantee by the Company on a PGH group bank loan and convertible Bonds issued in 2011.

Convertible Bonds payable

On 5 April 2013, the Company issued 5,000 Bonds (the 'Euro Bonds') at €10 thousand each, bearing interest of 5.5% per annum, payable semi-annually, and maturing on 5 April 2018. On 23 April 2013, the Company issued 917 Bonds (the 'US$ Bonds') at US$10 thousand each, bearing interest of 7% per annum, payable semi-annually, and maturing on 23 April 2018. The Euro Bonds and the US$ Bonds may be converted prior to maturity (unless earlier redeemed or repurchased) at the option of the holder into common shares of €0.01 each. The conversion price is €0.5623, equivalent of GBP 0.49 (initial conversion price GBP 0.50) and US$0.6583, equivalent of GPB 0.4410 (initial conversion price GBP 0.45) per share for the Euro Bonds and the US$ Bonds, respectively. The Euro Bonds and the US$ Bonds are not publicly traded.

Part of the Bonds, amounting to €41,004 thousand, was subscribed for by Third Point LLC, a significant shareholder of the Company. On 8 December 2016, both Euro Bonds and US Bonds were cancelled and all accrued interest was waived as a result of the Share Purchase Agreement entered into for the sale of Playa Grande Golf & Resort (see note 33).

On 29 March 2011, DCI H7 issued 4,000 Bonds at US$10 thousand each, bearing interest of 7% per annum, payable semi-annually, and maturing on 29 March 2016. The Bonds were trading on the Open Market of the Frankfurt Stock Exchange (the freiverkehr market) under the symbol 12DD. On 23 April 2013, the Company purchased 891 Bonds at a consideration of US$10 thousand each (representing their par value) plus corresponding accrued interest of approximately US$200 thousand using the funds received from the issue of the US$ Bonds. On 10 June 2015, certain bondholders, including the Investment Manager, opted to convert Bonds of total value US$14,420 thousand into 42,930,080 shares that were admitted on AIM on 11 June 2015. The Investment Manager converted Bonds of total value US$420 thousand into 1,250,390 shares. The remaining amount of DCI H7 Bonds including any accrued interest was repaid on scheduled maturing date in March 2016.

26. Deferred tax assets and liabilities

	31 December 2016		31 December 2015
	Deferred	Deferred	Deferred	Deferred
	tax assets	tax liabilities	tax assets	tax liabilities
	€'000	€'000	€'000	€'000
Balance at the beginning of the year	997	(30,129)	2,557	(55,180)
From disposal of subsidiary (see note 33)	-	-	-	314
Recognised in profit or loss - continuing operations	(1,549)	5,107	256	15,112
Recognised in profit or loss - discontinued operation	-	1,273	-	-
Recognised in other comprehensive income (see note 14)	-	(1,682)	-	1,791
Reclassification to (assets)/liabilities held for sale	1,548	1,239	(1,628)	8,091
Exchange difference and other	-	(63)	(188)	(257)
Balance at the end of the year	996	(24,255)	997	(30,129)

Deferred tax assets and liabilities are attributable to the following:

	31 December 2016		31 December 2015
	Deferred	Deferred	Deferred	Deferred
	tax assets	tax liabilities	tax assets	tax liabilities
	€'000	€'000	€'000	€'000
Revaluation of investment property	-	(15,268)	-	(23,819)
Revaluation of trading properties	-	(1,905)	-	(1,926)
Revaluation of property, plant and equipment	-	(6,449)	-	(6,007)
Other temporary differences	-	(633)	-	1,623
Tax losses	996	-	997	-
Total	996	(24,255)	997	(30,129)

27. Finance lease LIABILITIES

	31 December 2016			31 December 2015
	Future		Present value	Future		Present value
	minimum		of minimum	minimum		of minimum
	lease		lease	lease		lease
	payments	Interest	payments	payments	Interest	payments
	€'000	€'000	€'000	€'000	€'000	€'000
Less than one year	49	1	48	78	1	77
Between two and five years	195	8	187	197	8	189
More than five years	4,162	1,415	2,747	4,186	1,419	2,767
Total	4,406	1,424	2,982	4,461	1,428	3,033

The major finance lease obligations comprise leases in Greece with 99-year lease terms.

28. DEFERRED REVENUE

	31 December 2016	31 December 2015
	€'000	€'000
Prepayment from clients	10,683	21,713
Government grant	7,230	7,353
Total	17,913	29,066

	31 December 2016	31 December 2015
	€'000	€'000
Non-current	7,230	17,846
Current	10,683	11,220
Total	17,913	29,066

29. Trade and other payables

	31 December 2016	31 December 2015
	€'000	€'000
Trade payables	660	4,019
Land creditors	25,354	25,609
Investment Manager fees	4,221	467
Professional fees accrual	1,952	-
Deposit relating to Pearl disposal	1,000	-
Branding fees accrual	2,444	2,459
Other payables and accrued expenses	13,960	32,385
Total	49,591	64,939

	31 December 2016	31 December 2015
	€'000	€'000
Non-current	6,479	6,698
Current	43,112	58,241
Total	49,591	64,939

30. NAV per share

	31 December 2016	31 December 2015
	'000	'000
Total equity attributable to owners of the Company (€)	233,887	481,589
Number of common shares outstanding at end of year	904,627	904,627
NAV per share (€)	0.26	0.53

31. Related party transactions

31.1 Directors' interest and remuneration

Directors' interest

Miltos Kambourides is the founder and managing partner of the Investment Manager.

The interests of the Directors as at 31 December 2016, all of which are beneficial, in the issued share capital of the Company as at this date were as follows:

	Shares
	'000
Miltos Kambourides (indirect holding)	66,019
Mark Townsend	282
Andrew Coppel	150

Save as disclosed, none of the Directors had any interest during the year in any material contract for the provision of services which was significant to the business of the Group.

	From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
	€'000	€'000
Remuneration	1,415	844
Equity-settled share-based payment arrangements - Directors Awards (see note 32)	94	60
Total remuneration	1,509	904

The Directors' remuneration details for the years ended 31 December 2016 and 31 December 2015 were as follows:

	From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
	€'000	€'000
Laurence Geller	*678	233
Robert Heller	205	175
Graham Warner	180	174
Mark Townsend	61	58
Justin Rimel	3	13
Andrew Coppel	232	34
David B. Heller	3	21
Sue Farr	53	-
Roger Lane-Smith	-	122
Andreas Papageorghiou	-	2
Cem Duna	-	2
Antonios Achilleoudis	-	2
Christopher Pissarides	-	8
Total	1,415	844

*Comprises €636 thousand compensation for loss of office and €42 thousand compensation for expenses.

Mr. Miltos Kambourides has waived his fees.

On 25 February 2015, the Company announced the following Directorate changes. Andreas Papageorghiou, Cem Duna, Antonios Achilleoudis and Christopher Pissarides stepped down from the Board. Five new members joined the Board - Laurence Geller, who also served as Chairman, Robert Heller, Graham Warner, Mark Townsend and Justin Rimel. Miltos Kambourides and David B. Heller remained on the new Board, as did Roger Lane Smith until his retirement on 31 December 2015. On 6 October 2015, Andrew Coppel also joined the Board.

On 1 March 2016, Laurence Geller, David B. Heller and Justin Rimel resigned from the Company's Board with Andrew Coppel being appointed as the Independent Chairman.

Laurence Geller no longer retains an interest in the stock options issued pursuant to the Company's Stock Option Programme, whilst Andrew Coppel does not participate in the Stock Option Programme.

On 19 July 2016, Sue Farr joined the Board as a non-executive Director.

31.2 Investment Manager remuneration

	From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
	€'000	€'000
Fixed management fee/Annual fee	7,500	12,813
Variable management fees/Performance fee	4,221	-
Equity-settled share-based payment arrangements - Investment Management Awards (see note 32)	(315)	315
Total remuneration	11,406	13,128

In 2016, the Investment Manager, fully waived any rights under the Investment Manager Awards it was entitled to under the terms of the previous Investment Management Agreement ('IMA') and the Company's share incentive plan (see note 32).

In line with the Amended and Restated IMA, signed in December 2016, with retroactive effect from 1 July 2016, the following arrangements came into effect:

i. Fixed management fee

The annual management fees for the second half of 2016 were retrospectively reduced from €8.5 million to €6.5 million per annum and have been set to a fixed declining annual amount equal to €6 million for 2017, €5 million for 2018 and €4 million for 2019.

Additionally, the term of the IMA has been reduced and will expire at the earlier of the end of the Divestment Period or 31 December 2019 rather than August 2020 as under the terms of the previous IMA. There will be no fixed management fee due for 2020.

ii. Variable management fee

Variable management fee has been introduced which will become payable solely upon the execution of each asset divestment by the Company. The variable management fee will be equal to a percentage of the enterprise value (i.e. the equity value of the asset plus any loans or other liabilities assumed by its purchaser) of any asset disposed by the Company during the Divestment Period at a valuation at or in excess of 50% of its latest reported NAV.

The variable management fee percentage will be equal to 3% for divestments executed within the second half 2016 and will be reduced to 2.5%, 2.0% and 1.3% for those concluded in 2017, 2018 and 2019 respectively for disposals completed at 50% or more of latest reported NAV. The variable management fee will increase in respect of transactions executed at sales prices exceeding 50% of their NAV.

The variable management fee will become payable to the Investment Manager three months from the completion of the respective disposal. Specifically in relation to the Playa Grande disposal, €1 million of the variable management fee has been paid upon the completion of the disposal and the balance will become payable at the earlier of the date when the Company makes a distribution of proceeds from asset sales to Shareholders or nine months from the completion of the Playa Grande disposal.

With regard to the disposal of Aristo Developers Ltd and Pearl Island, the Manager will be entitled to a Variable annual management fee equal to 3%, 2.5%, 2% and 1.3% on the portion of their corresponding Total Disposal Prices received by the Company within 2016, 2017, 2018 and 2019 respectively.

Investment Manager was entitled to a performance fee payable under the terms of the previous IMA. There is no change to this entitlement. However, any performance fees earned under this arrangement will be fully deducted from any future annual management fees and variable management fees payable over the term of the IMA.

Previous arrangements, in force until 30 June 2016

Annual fee

The Investment Manager is entitled to an annual management fee defined as follows:

• for the period from 1 July 2015 to and including 31 December 2016, the annual management fee shall be €1 million per calendar month payable quarterly in advance; and

• with effect from and including 1 January 2016, the annual management fee shall be €8.5 million payable quarterly in advance.

• commencing on and with effect from 1 January 2017, the annual management fee payable for the following annual periods will be permanently reduced on 1 January in each year to an amount equal to the lower of:

(i) 1.25% of the gross asset value of the Company calculated as at the last preceding 31 December calculation date; and

(ii) €8.5 million.

In addition, the Company shall reimburse the Investment Manager for any professional fees or other costs incurred on behalf of the Company for the provision of services or advice.

Performance fee

i. Core asset incentive fee

The Investment Manager will be entitled to the core asset incentive fee based on the net profits received by the Company from the core assets or the disposal thereof.

Core assets comprise of the following projects: Amanzoe, Kilada Hills, Kea, Pearl Island and Playa Grande. All other assets of the company are characterized as non-core for the purpose of incentive fee calculations.

The net proceeds will be divided between the Investment Manager and the Company on the following basis:

• first, 100% to the Company until the Company has received an amount equal to €169.6 million (the 'Aggregate Core Asset Base Value');

• second, 100% to the Company until the Company has received an amount equal to the core asset capital and costs;

• third, 100% to the Company until the Company has received an amount equal to the base cost compounded quarterly at the average one-month Euribor rate plus 500 basis points (but capped at a maximum interest rate of 6% per annum);

• fourth, 60% to the Investment Manager and 40% to the Company until the Investment Manager has received an amount equal to 20% of the Net Profits then distributed; and

• thereafter, 20% to the Investment Manager and 80% to the Company such that the Investment Manager shall receive a total core asset incentive fee equivalent to 20% of the Net Profits.

On the disposal of a core asset, the Investment Manager shall be entitled to receive an advance of the core asset incentive fee on the following basis:

• where the disposal takes place prior to the date on which the Company shall have first received an amount of net profits from the disposal of core assets equal to, or in excess of, €113,055,360 (the 'Trigger Date'), an amount equal to 6.666% of the net profits received by the Company on the disposal of such core asset; or

• where the disposal takes place after the Trigger Date, an amount equal to 10% of the net profits received by the Company on the disposal of such core asset, (in each case a 'Core Asset Incentive Fee Advance Payment').

The aggregate value of any Core Asset Incentive Fee Advance Payments will at any time be set off against, and thereby reduce to not less than zero, any liability of the Company to pay core asset incentive fees.

ii. Non-core asset incentive fee

The Investment Manager will be entitled to the non-core asset incentive fee based on the net profits received by the Company from the disposal of any non-core assets. No non-core asset incentive fee will be payable in respect of a non-core asset unless the aggregate disposal proceeds actually received by the Company in respect of such non-core asset exceeds the base value (the 'Payment Condition'). The base value is defined as 65% of the non-core asset value as at 31 December 2014. Subject to satisfaction of the Payment Condition in respect of any non-core asset, the net proceeds actually received by the Company from the disposal of such non-core asset will be divided between the Investment Manager and the Company on the following basis:

• first, 100% to the Company until the Company has received an amount equal to the base value;

• second, 12.5% to the Investment Manager and 87.5% to the Company until the net proceeds equal 80% of the base value;

• third, 17.5% to the Investment Manager and 82.5% to the Company until the net proceeds equal 100% of the base value; and

• thereafter, 25% to the Investment Manager and 75% to the Company.

50% of each non-core asset incentive fee will be placed in an interest bearing escrow account to be operated by the Company's administrator. Any funds held in this escrow account will be dealt with as follows; commencing on 31 December 2016, in the event that, as at 31 December in each year, the aggregate net proceeds received by the Company in relation to all non-core assets disposed of during the previous 12 month period (the 'Look-back Period'):

• do not equal or exceed the aggregate of the base values of any non-core assets disposed of during an applicable Look-back Period (the 'Aggregate Base Value') then the Company's administrator will be authorised to repay any escrowed funds to the Company until such time as the Company has received an amount equal to the Aggregate Base Value and thereafter any remaining escrowed funds (if any) will be paid to the Investment Manager; or

• equal or exceed the Aggregate Base Value then the Company's administrator will be authorised to pay to the Investment Manager the escrowed funds.

A clawback provision is in place with regard to incentive (performance) fee payments in the event the aggregate proceeds from the disposal of assets do not exceed a certain threshold.

Previous arrangements, in force until 30 June 2015

Annual fees

The Investment Manager was entitled to an annual management fee of 2% of the equity funds defined as follows:

• €890 million; plus

• The gross proceeds of further equity issues, other than the funds raised in respect of the proceeds of the equity issues as at 25 October 2012 and 30 December 2011; plus

• Realised net profits less any amounts distributed to shareholders.

The equity funds as at 30 June 2015 comprised €681 million.

In addition, the Company reimbursed the Investment Manager for any professional fees or other costs incurred on behalf of the Company for the provision of services or advice.

Performance fees

The Investment Manager was entitled to a performance fee based on the net profits made by the Company, subject to the Company receiving the 'Relevant Investment Amount' which is defined as an amount equal to:

I. The total cost of the investment reduced on a pro rated basis by an amount of €160.1 million*; plus

II. A hurdle amount equal to an annualised percentage return equal to the average one-month Euribor rate applicable in the period commencing from the month when the relevant cost was incurred compounded for each year or fraction of a year during which such investment was held (the 'Hurdle'); plus

III. A sum equal to the amount of any realised losses and/or write-downs in respect of any other investment which has not already been taken into account in determining the Investment Manager's entitlement to a performance fee.

In the event that the Company had received distributions from an investment equal to the Relevant Investment Amount, any subsequent net profits arising should have been distributed in the following order or priority:

I. 60% to the Investment Manager and 40% to the Company until the Investment Manager should had received an amount equal to 20% of such profits; and

II. 80% to the Company and 20% to the Investment Manager, such that the Investment Manager should had received a total performance fee equivalent to 20% of the net profits.

* The total cost of investment was reduced in April 2014 by €7.6 million, as compared to the base reduction of €167.7 million, to reflect the loss incurred by the Company through the Pasakoy Yapi ve Turizm A.S. ('Pasakoy') sale transaction, as calculated in accordance with the Investment Management Agreement provisions and definitions.

The performance fee payment was subject to certain escrow and clawback provisions. As at 31 December 2016, the funds held in escrow, including accrued interest, were released (2015: funds in escrow - €467 thousand).

31.3 Shareholder and development agreements

Shareholder agreements

DolphinCI Twenty Two Limited, a subsidiary of the Group, had signed a shareholder agreement with the non-controlling shareholder of Eastern Crete Development Company S.A., under which it had acquired 60% of the shares of the Plaka Bay project by paying the former majority shareholder a sum upon closing and a conditional amount in the event the non-controlling shareholder was successful in, among others, acquiring additional specific plots and obtaining construction permits. On 23 August 2013, the parties signed a new agreement for the purchase of the remaining 40% stake of the entity. The base consideration for the purchase was €4.4 million payable in three installments: €2.4 million by 10 September 2013, €1 million by 30 September 2013 and €1 million by 31 October 2013. The last installment of €1 million was transferred in February 2014. Consideration might be increased by the transfer of plots of land in the project, to the seller, of total market value equal to €4 million, subject to the project receiving permits for building 40,000 m², of freehold residential properties. The conditional deferred consideration will be adjusted pro rata in case the buildable properties are less than 40,000 m² but is also subject to a 5% annual increase commencing from the second anniversary from the signing of the agreement and until implementation by the Company.

On 20 September 2010, the Group signed an agreement with Archimedia, controlled by John Hunt, for the sale of a 14.29% stake in Amanzoe for a consideration of €11 million. The agreement also granted Archimedia the right to partially or wholly convert this shareholding stake into up to three predefined Aman Villas (the 'Conversion Villas') for a predetermined value and percentage per Villa. The first €1 million of the consideration was received at signing, while the completion of the transaction and the payment of the €10 million balance was subject to customary due diligence on the project and the issuance of the construction permits for the Conversion Villas prior to a longstop date set at 1 April 2011. On 28 March 2011, the Company reached an agreement with Archimedia to vary the original terms of the sale agreement, which was followed by the Company and Archimedia entering into an amended sale agreement on 13 March 2012. The Company received US$12,422 thousand and €1,300 thousand, while US$978 thousand and €800 thousand due as at 31 December 2013, plus any additional consideration that could be due depending on the exact size and features of the Conversion Villas, would be received upon completion of the Conversion Villas. On 2 July 2014, Archimedia remitted €904 thousand (€263 thousand and US$878 thousand) to the Company towards this end. As of 31 December 2015 no receivable amount was outstanding. On 3 August 2012, the Company received a Conversion Notice from Archimedia to convert 6.43% of its shares in Amanzoe in exchange for an Aman Villa and on 27 December 2012 a further Notice for the conversion of the remaining 7.86% of its shares for two other Aman Villas. As of 31 December 2015, all Villas Conversions had been completed and Archimedia did not hold any shareholding interest in Amanzoe.

Shareholder agreements

On 6 August 2012, the Company signed an agreement for the sale of eight out of the nine remaining Seafront Villas, part of the Mindcompass Overseas Limited group of entities. The total base net consideration agreed for this sale was €10 million, with the Company also entitled to 50% profit participation in the sale of five Villas. It was also agreed that the Company would undertake the construction contract for the completion of the Villas and a €1 million deposit was paid upon signing. During 2013, the Company received an additional amount of €990 thousand. The construction of the two Villas is currently underway.

On 5 September 2012, the Company signed a sales agreement with a regional investor group led by Mr. Alberto Vallarino for the sale of its 60% shareholding in Peninsula Resort Holdings Limited, the entity that indirectly holds the land for Pearl Island's Founders' phase of the Pearl Island Project. The consideration for the sale was a cash payment of US$6 million (50% paid at closing on 14 September 2012 and 50% one year from closing, collected on 17 September 2013) and a commitment to invest an additional circa US$35 million of development capital within a maximum period of two years in order to complete the aforementioned phase of the project. Out of those funds, approximately US$13 million would be incurred on development of components owned by Pearl Island Limited S.A., with the entire amount already invested by 31 December 2015.

Development agreements

Pursuant to the original Sale and Purchase Agreement of 10 December 2007, DCI H7 was obliged to make payments for the construction of infrastructure on the land retained by DR Beachfront Real Estate LLC ('DRB'), the former majority shareholder of PGH. Pursuant to a restructuring agreement dated 5 November 2012, those obligations have been restructured with the material provisions of that agreement already fulfilled. As at 31 December 2015, following cash payments of US$7.6 million and transfers of land parcels valued at approximately US$11.7 million, no amount is outstanding. As stated in note 33, the Company entered into a share purchase agreement for the sale of the project on 14 November 2016 and completion took place on 8 December 2016.

Pedro Gonzalez Holdings II Limited, a subsidiary of the Group in which the Company holds a 60% stake, has signed a Development Management agreement with DCI Holdings Twelve Limited ('DCI H12') in which the Group has a stake of 60%. Under its terms, DCI H12 undertakes, among others, the management of permitting, construction, sale and marketing of the Pearl Island project. As stated in note 38, the Company entered into a share purchase agreement for the sale of its shareholding in the project on 17 January 2017 and completion took place on 13 March 2017.

31.4 Other related parties

During the years ended 31 December 2016 and 31 December 2015, the Group entered into the following related party transactions with the following parties:

2016 Related party name	€'000	Nature of transaction
Iktinos Hellas S.A.	40	Project management services in relation to Sitia project and rent payment
Third Point LLC, shareholder of the Company	1,200	Bond interest for the year
Third Point LLC, shareholder of the Company	24,566	Loss on disposal of DCA H6 (see note 33)

2015 Related party name	€'000	Nature of transaction
Iktinos Hellas S.A.	48	Project management services in relation to Sitia project and rent payment
John Heah, non-controlling shareholder of SPV 10	191	Design fees in relation to Kea Resort project and Playa Grande project
Progressive Business Advisors S.A.	282	Accounting fees
Third Point LLC, shareholder of the Company	2,401	Bond interest for the year

32. EQUITY-SETTLED SHARE-BASED PAYMENT ARRANGEMENTS

	From 1 January 2016 to 31 December 2016	From 1 January 2015 to 31 December 2015
	€'000	€'000
Investment Manager Awards (see note 31.2)	(315)	315
Director Awards (see note 31.1)	94	60
Total equity-settled share-based payment arrangements	(221)	375

Investment Manager Awards

On 9 June 2015, under a Stock Incentive Plan, the Company granted two nil-cost share option awards to the Investment Manager (the 'DCP Awards') as follows:

Number of Shares to which the DCP Awards relate:

· DCP Award 1: 31,661,940 common shares of €0.01 each; and

· DCP Award 2: 22,615,671 common shares of €0.01 each,

both subject to reductions in case that certain non-market performance targets are not met.

These awards were to performance vest in various equal tranches dependent upon the average closing price of the shares trading at or above certain relevant target share prices for a continuous period of 30 trading days. The relevant target share prices for the purposes of these awards ranged from 35p to 80p.

In 2016, as stated in note 31.2, the Investment Manager fully waived any rights under these Awards that it was entitled to under the terms of the previous IMA and the Company's share incentive plan.

Director Awards

On 9 June 2015, Mr. Laurence Geller, Mr. Robert Heller and Mr. Graham Warner were granted nil-cost share option awards under a Stock Incentive Plan (the 'Director Awards'). These awards will performance vest in equal tranches dependent upon the average closing price of the shares trading at or above certain relevant target share prices for a continuous period of 30 trading days. The relevant target share prices for the purposes of these awards are 35p, 40p, 45p, and 50p. Director Awards remain exercisable up until the day before the fifth anniversary of the grant date of the awards. On 1 March 2016, Mr. Laurence Geller, resigned from the Company's Board and no longer retains an interest in the stock options issued pursuant to the Company's Stock Option Programme. The number of shares to which the Director Awards relate is 5,993,153 common shares of €0.01 each with reductions in the event that certain non-market performance targets are not met.

The most significant inputs used in the measurement of the grant date fair value of the Awards are as follows:

	Awards

Fair value at grant date	£0.0659
Share price at grant date	£0.215
Exercise price	Nil
Expected volatility (long run forecast)	31%
Risk-free rate (based on UK government 5 years Bonds)	1.523%

33. Business combinations

On 14 November 2016, the Company signed a share purchase agreement with an investor group represented by Third Point LLC for the sale of DCA H6, the entity that indirectly held the Playa Grande Golf and Resort project. Completion of the sale was conditional on the lapse of a Right of First Refusal in relation to the project in favour of its prior owner. The consideration for the sale comprised of a cash payment of US$5 million (of which approximately US$ 1 million will remain in escrow to cover certain potential post completion claims and liabilities) and the retirement of all of the Company's €50 million and US$9.17 million 2018 Convertible Bonds together with any accrued interest on the Bonds. Completion of the sale took place on 8 December 2016, with the 2018 Convertible Bonds cancelled on the same date and the Company having received US$4 million on 8 December 2016.

During 2016, the Group also disposed of its entire holding in Infatran Limited ('Infatran') and DolphinCI Eleven Limited ('DCI 11').

	Note	DCA H6	Infatran	DCI11	Total
		€'000	€'000	€'000	€'000
Investment property	17	(74,644)	-	-	(74,644)
Property, plant and equipment	16	(78,300)	-	-	(78,300)
Trading properties	19	(3,193)	(1,413)	(1,599)	(6,205)
Other non-current assets		(632)	-	-	(632)
Receivables and other assets		(1,540)	-	-	(1,540)
Cash and cash equivalents		(2,035)	-	-	(2,035)
Loans and borrowings		56,024	-	-	56,024
Deferred revenue		10,660	-	-	10,660
Trade and other payables		6,665	5	16	6,686
Net assets disposed of		(86,995)	(1,408)	(1,583)	(89,986)
Net proceeds on disposal		62,429	845	-	63,274
Disposal consideration via settlement of liability		-	-	2,780	2,780
(Loss)/gain on disposal recognised in profit or loss		(24,566)	(563)	1,197	(23,932)
Cash effect on disposal:
Net proceeds on disposal		62,429	845	-	63,274
Cash and cash equivalents		(2,035)	-	-	(2,035)
Net cash inflow on disposal		60,394	845	-	61,239

During the year ended 31 December 2015, the Group increased its ownership interest in DCI 14 by 7.86% to 100% as follows:

		DCI 14
		€'000
Non-controlling interests acquired		(3,236)
Consideration transferred		(5,108)
Less: receivables assignment		3,347
Net consideration transferred		(1,761)
Acquisition effect recognised in equity		(4,997)

The consideration transferred for the acquisition of the 7.86% stake in DCI 14 relates to a Conversion Villa, per the relevant agreement (see note 31.3).

On 2 October 2015, DCI H1 sold the shares of its wholly-owned subsidiary DolphinCI Twenty Seven Ltd ('DCI 27') to DRG Development Greece Ltd, as follows:

	Note	DCI 27
		€'000
Investment property	17	(10,979)
Property, plant and equipment	16	(1,422)
Trading properties	19	(1,952)
Other non-current assets		(24)
Receivables and other assets		(5,242)
Cash and cash equivalents		(299)
Loans and borrowings		9,055
Finance lease liabilities		6,162
Deferred tax liabilities	26	314
Other non-current liabilities		206
Trade and other payables		5,004
Net liabilities disposed of		823
Proceeds on disposal		-
Gain on disposal recognised in profit or loss		823
Cash effect on disposal:
Proceeds on disposal		-
Cash and cash equivalents		(299)
Net cash outflow on disposal		(299)

The consideration was €1 along with profit sharing based on the net proceeds that may be received by DCI 27 in respect of any disposal of its subsidiary Aristo Developers S.A. or any of the subsidiary's assets. Profit sharing is adjusted on a yearly basis and is set to 50%, 35% and finally 20% in the period between the second and third anniversary from the sale. The profit sharing entitlement will lapse on the third anniversary from the sale date.

34. Non-CONTROLLING INTERESTs

The following table summarises the information relating to each of the Group's subsidiaries that has material non-controlling interests, before any intra-group eliminations.

31 December 2016	SPV 10 (Kea Resort) €'000	SPV 2 (Amanzoe) €'000
Non-controlling interests percentage	33.33%	35.60%
Non-current assets	21,124	217
Current assets	131	3,837
Non-current liabilities	(21,921)	(75)
Current liabilities	(441)	(349)
Net (liabilities)/assets	(1,107)	3,630
Carrying amount of non-controlling interests	(369)	1,293
Revenue	40	77
Loss	(368)	(91)
Other comprehensive income	-	-
Total comprehensive income	(368)	(91)
Loss allocated to non-controlling interests	(123)	(32)
Other comprehensive income allocated to non-controlling interests	-	-
Cash flow (used in)/from operating activities	(77)	19
Cash flow from investing activities	-	-
Cash flow from financing activities	-	-
Net (decrease)/increase in cash and cash equivalents	(77)	19

31 December 2015	DCI Holdings Eleven Limited (Pearl Island) €'000	Pedro Gonzalez Holdings I Limited (Pearl Island) €'000	Iktinos (Sitia Bay) €'000	DCI 14 (Amanzoe) €'000	SPV 10 (Kea Resort) €'000	SPV 2 (Amanzoe) €'000
Non-controlling interests percentage	40%	40%	22.18%	0%*	33.33%	31.68%
Non-current assets	1,040	91,508	21,160	82,494	21,012	248
Current assets	3,463	7,972	45	39,444	75	3,906
Non-current liabilities	(67)	(2,432)	(1,954)	(137,688)	(21,531)	(75)
Current liabilities	(5,564)	(21,391)	(334)	(23,063)	(294)	(357)
Net (liabilities)/assets	(1,128)	75,657	18,917	(38,813)	(738)	3,722
Carrying amount of non-controlling interests	(451)	30,263	4,196	-	(246)	1,179
Revenue	1,994	65	-	41,147	829	165
(Loss)/ profit	(823)	(463)	(7,576)	(8,156)	615	(7)
Other comprehensive income	-	-	-	(5,057)	-	-
Total comprehensive income	(823)	(463)	(7,576)	(13,212)	615	(7)
(Loss)/profit allocated to non-controlling interests	(329)	(185)	(1,680)	(641)	205	(1)
Other comprehensive income allocated to non-controlling interests	-	-	-	(397)	-	-
Cash flow (used in)/from operating activities	(66)	3,248	(84)	(43,122)	(1,455)	(4,247)
Cash flow from/(used in) investing activities	76	(3,393)	107	45,481	1,398	-
Cash flow from/(used in) financing activities	-	(121)	-	(2,331)	-	4,253
Net increase/(decrease) in cash and cash equivalents	10	(266)	23	28	(57)	6

*As mentioned in note 31.3, the Group during 2015 increased its shareholding interest in DCI 14 to 100%.

35. FINANCIAL RISK MANAGEMENT

Financial risk factors

The Group is exposed to credit risk, liquidity risk and market risk from its use of financial instruments. The Board of Directors has overall responsibility for the establishment and oversight of the Group's risk management framework. The Group's risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls, and monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Group's activities. The Group's overall strategy remains unchanged from last year.

(i) Credit risk

Credit risk arises when a failure by counter parties to discharge their obligations could reduce the amount of future cash inflows from financial assets on hand at the statement of financial position date. The Group has policies in place to ensure that sales are made to customers with an appropriate credit history and monitors on a continuous basis the ageing profile of its receivables. The Group's trade receivables are secured with the property sold. Cash balances are mainly held with high credit quality financial institutions and the Group has policies to limit the amount of credit exposure to any financial institution.

The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the end of the reporting year was as follows:

	Carrying amount
	31 December 2016	31 December 2015
	€'000	€'000
Trade and other receivables (see note 22)	3,231	15,196
Cash and cash equivalents (see note 23)	4,669	41,948
Total	7,900	57,144

Trade and other receivables

Exposure to credit risk

The maximum exposure to credit risk for trade and other receivables at the end of the reporting year by geographic region was as follows:

	Carrying amount
	31 December 2016	31 December 2015
	€'000	€'000
South-East Europe	2,662	12,464
Americas	569	2,732
Total trade and other receivables	3,231	15,196

Credit quality of trade and other receivables

The Group's trade and other receivables are unimpaired.

Cash and cash equivalents

Exposure to credit risk

The table below shows an analysis of the Group's bank deposits by the credit rating of the bank in which they are held:

		31 December 2016		31 December 2015
	No. of Banks	€'000	No. of Banks	€'000
Bank group based on credit ratings by Moody's
Rating Aaa to A	1	1,281	3	69
Rating Baa to B	-	-	1	5
Rating Caa to C	5	3,387	5	6,188
Bank group based on credit ratings by Fitch's
Rating AAA to A-	-	-	1	572
Rating BBB to B-	1	1	4	35,114
Total bank balances		4,669		41,948

(ii) Liquidity risk

Liquidity risk is the risk that arises when the maturity of assets and liabilities does not match. An unmatched position potentially enhances profitability, but can also increase the risk of losses. The Group has procedures with the object of minimising such losses such as maintaining sufficient cash and other highly liquid current assets and by having available an adequate amount of committed credit facilities.

The following tables present the contractual maturities of financial liabilities. The tables have been prepared on the basis of contractual undiscounted cash flows of financial liabilities, and on the basis of the earliest date on which the Group might be forced to pay.

	Carrying amounts	Contractual cash flows	Within one year	One to two years	Three to five years	Over five years
	€'000	€'000	€'000	€'000	€'000	€'000
31 December 2016
Loans and borrowings	92,270	(134,228)	(17,587)	(23,466)	(78,796)	(14,379)
Finance lease obligations	2,982	(4,406)	(49)	(49)	(146)	(4,162)
Land creditors	25,354	(25,354)	(25,354)	-	-	-
Trade and other payables	15,110	(15,110)	(8,632)	(116)	-	(6,362)
	135,716	(179,098)	(51,622)	(23,631)	(78,942)	(24,903)
31 December 2015
Loans and borrowings	223,680	(313,641)	(44,900)	(24,931)	(220,034)	(23,776)
Finance lease obligations	3,033	(4,461)	(78)	(50)	(148)	(4,185)
Land creditors	25,609	(25,609)	(25,609)	-	-	-
Trade and other payables	30,187	(30,187)	(23,489)	(455)	-	(6,243)
	282,509	(373,898)	(94,076)	(25,436)	(220,182)	(34,204)

(iii) Market risk

Market risk is the risk that changes in market prices, such as interest rates, equity prices and foreign exchange rates, will affect the Group's income or the value of its holdings of financial instruments.

Interest rate risk

Interest rate risk is the risk that the value of financial instruments will fluctuate due to changes in market interest rates. The Group's income and operating cash flows are substantially independent of changes in market interest rates as the Group has no significant interest-bearing assets. Borrowings issued at variable rates expose the Group to cash flow interest rate risk. Borrowings issued at fixed rates expose the Group to fair value interest rate risk. The Group's management monitors the interest rate fluctuations on a continuous basis and acts accordingly.

Sensitivity analysis

An increase of 100 basis points in interest rates at 31 December would have decreased equity and profit or loss by €499 thousand (2015: €1,076 thousand). This analysis assumes that all other variables, in particular foreign currency rates, remain constant. For a decrease of 100 basis points there would be an equal and opposite impact on the profit or loss and other equity.

Currency risk

Currency risk is the risk that the value of financial instruments will fluctuate due to changes in foreign exchange rates. Currency risk arises when future commercial transactions and recognised assets and liabilities are denominated in a currency that is not the Group's measurement currency. The Group is exposed to foreign exchange risk arising from various currency exposures primarily with respect to the United States dollar. The Group's management monitors the exchange rate fluctuations on a continuous basis and acts accordingly.

The Group's exposure to foreign currency risk for its use of financial instruments was as follows:

	31 December 2016			31 December 2015
	Euro	USD	GBP	Euro	USD	GBP
	'000	'000	'000	'000	'000	'000
Trade and other receivables	2,662	600	-	12,467	2,973	-
Cash and cash equivalents	4,531	144	1	36,988	2,462	2,008
Loans and borrowings	(92,270)	-	-	(142,395)	(88,495)	-
Finance lease obligations	(2,982)	-	-	(3,004)	(28)	-
Land creditors	(25,354)	-	-	(24,746)	(938)	-
Trade and other payables	(22,197)	(2,149)	-	(24,255)	(16,423)	-
Net statement of financial position exposure	(135,610)	(1,405)	1	(144,945)	(100,449)	2,008

The following exchange rates applied at the date of financial position:

Euro 1 equals to:	31 December 2016	31 December 2015
USD	1.05	1.09
TRY	3.71	3.18
HRK	7.56	7.64
GBP	0.86	0.73

Sensitivity analysis

A 10% strengthening of the Euro against the following currencies at 31 December would affected the measurement of financial instruments denominated in a foreign currency and increased/(decreased) equity and profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant. For a 10% weakening of the Euro against the relevant currency, there would be an equal and opposite impact on the profit and other equity.

	Equity		Profit or loss
	2016	2015	2016	2015
	€'000	€'000	€'000	€'000
USD	121	8,388	121	8,388
TRY	-	-	-	-
HRK	-	-	-	-
GBP	-	(249)	-	(249)

Capital management

The Group manages its capital to ensure that it will be able to continue as a going concern while improving the return to shareholders. The Board of Directors is committed to implementing a package of measures that is expected to focus on the achievement of the Group's investment objectives, achieve cost efficiencies and strengthen its liquidity. Notably, these measures include the completion of certain Group asset divestment transactions, as well as the conclusion of additional working capital facilities at the Group and/or Company level.

36. Commitments

As of 31 December 2016, the Group had a total of €1,330 thousand contractual capital commitments on property, plant and equipment (2015: €3,229 thousand).

Non-cancellable operating lease rentals are payable as follows:

	31 December 2016	31 December 2015
	€'000	€'000
Less than one year	11	19
Between two and five years	-	11
Total	11	30

37. Contingent liabilities

Companies of the Group are involved in pending litigations. Such litigations principally relate to day-to-day operations as a developer of second-home residences and largely derive from certain clients and suppliers. Based on the Group's legal advisers, the Company believes that there is sufficient defence against any claim and they do not expect that the Group will suffer any material loss. All provisions in relation to these matters which are considered necessary have been recorded in these consolidated financial statements.

A Company of the Group received an out-of-the court notice to settle an amount of €3.97 million to a lending institution which related to claims assigned by one of the relevant Group Company's partners. The Company responded negatively to the lending institution and the partner is currently in discussions with the lending institution in order to resolve the issue. The Company's position is that there are no existing obligations towards this lending institution by the relevant Group Company as well as that, in all cases, any such contingent liabilities can be claimed and recovered from the partner.

If investment properties, trading properties and property, plant and equipment were sold at their fair market value, this would have given rise to a variable management fee to the Investment Manager, which would be based on the relevant IMA provisions.

In addition to the tax liabilities that have already been provided for in the consolidated financial statements based on existing evidence, there is a possibility that additional tax liabilities may arise after the examination of the tax and other matters of the companies of the Group in the relevant tax jurisdictions.

The Group, under its normal course of business, guaranteed the development of properties in line with agreed specifications and time limits in favor of other parties.

38. SUBSEQUENT EVENTS

On 17 January 2017, the Company signed a share purchase agreement with Grivalia Hospitality S.A. for the sale of its 60% shareholding in all entities related with the Pearl Island Project. Completion of the disposal was subject to a corporate restructuring and to the consent of the appointed hotel operator to modifications of certain terms of the hotel management agreement. The consideration for the sale comprised of a cash payment of €27 million, payable in the form of a €1 million non-returnable deposit which was received on 19 October 2016, €24 million upon completion of the sale and the remaining €2 million to be retained in an escrow account for a period of 12 months post completion to cover any tax liabilities, potential breach of the Company's warranties or undisclosed indebtedness. Completion took place on 13 March 2017 with €24 million received by the Company on the same date.

On 3 May 2017, the Company decided to terminate the agreement with TA to dispose of its Aristo shares, as a result of TA's failure to settle deferred payments by 30 April 2017. The Company will retain the unpaid portion of its Aristo shares, which corresponds on 3 May 2017 to 47.9%. The Board remains committed to dispose of its investment in Aristo and realize value from the remaining shareholding.

There were no other material events after the reporting period, which have a bearing on the understanding of the consolidated financial statements as at 31 December 2016.

This information is provided by RNS

The company news service from the London Stock Exchange

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