EX-99.2 3 exhibit_99-2.htm EXHIBIT 99.2

Exhibit 99.2
 
Financial Information for the Three and Nine Months Ended September 30, 2018 of Kenon, OPC and Qoros and
 
Reconciliation of Certain non-IFRS Financial Information

Table of Contents






 
 

Appendix A
 
Summary Kenon consolidated financial information
 
Kenon Holdings Ltd. and subsidiaries
 Consolidated Statements of Financial Position as of September 30, 2018 and December 31, 2017

   
As of September 30,
    
As of December 31,
  
   
2018
    
2017
  
   
$ millions
  
Current assets
            
Cash and cash equivalents
    
275
      
1,417
  
Short-term investments and deposits
    
28
      
7
  
Trade receivables, net
    
43
      
44
  
Other current assets, including derivatives
    
21
      
36
  
Total current assets
    
367
      
1,504
  
Non-current assets
                
Investments in associated companies
    
262
      
122
  
Deposits, loans and other receivables, including derivative instruments
    
216
      
107
  
Deferred payment receivable
    
186
      
175
  
Deferred taxes, net
    
1
      
-
  
Property, plant and equipment, net
    
627
      
616
  
Intangible assets, net
    
2
      
2
  
Total non-current assets
    
1,294
      
1,022
  
Total assets
    
1,661
      
2,526
  
Current liabilities
                
Loans and debentures
    
23
      
448
  
Trade payables
    
65
      
59
  
Other payables, including derivative instruments
    
10
      
83
  
Provisions
    
-
      
44
  
Income tax payable
    
7
      
173
  
Total current liabilities
    
105
      
807
  
Non-current liabilities
                
Loans, excluding current portion
    
506
      
504
  
Debentures, excluding current portion
    
79
      
85
  
Deferred taxes, net
    
61
      
52
  
Income tax payable
    
27
      
27
  
Total non-current liabilities
    
673
      
668
  
Total liabilities
    
778
      
1,475
  
Equity
                
Share capital
    
602
      
1,267
  
Shareholder transaction reserve
    
-
      
4
  
Translation reserve
    
4
      
(2
)
Capital reserve
    
16
      
19
  
Accumulated profit / (loss)
    
191
      
(305
)
Equity attributable to owners of the Company
    
813
      
983
  
Non-controlling interests
    
70
      
68
  
Total equity
    
883
      
1,051
  
Total liabilities and equity
    
1,661
      
2,526
  
 
2
 
Kenon Holdings Ltd. and subsidiaries
 Consolidated Statements of Profit & Loss
 
   
For the nine months ended
September 30,
    
For the three months ended
September 30,
  
   
2018
    
2017
    
2018
    
2017
  
   
$ millions
    
$ millions
  
Revenue
    
279
      
274
      
94
      
97
  
Cost of sales and services (excluding depreciation)
    
(188
)
    
(200
)
    
(61
)
    
(69
)
Depreciation
    
(23
)
    
(23
)
    
(8
)
    
(7
)
Gross profit
    
68
      
51
      
25
      
21
  
Selling, general and administrative expenses
    
(18
)
    
(33
)
    
(6
)
    
(11
)
Other income
    
1
      
-
      
-
      
-
  
Other expenses
    
(1
)
    
-
      
-
      
-
  
Operating profit
    
50
      
18
      
19
      
10
  
Financing expenses
    
(24
)
    
(59
)
    
(7
)
    
(15
)
Financing income
    
23
      
4
      
11
      
-
  
Financing (expenses) / income, net
    
(1
)
    
(55
)
    
4
      
(15
)
Gain on third party investment in Qoros
    
504
      
-
      
-
      
-
  
Fair value loss on derivative asset
    
(21
)
    
-
      
(8
)
    
-
  
Write back of financial guarantee
    
63
      
-
      
-
      
-
  
Share in losses of associated companies, net of tax
    
(72
)
    
(33
)
    
(22
)
    
(11
)
Profit / (loss) before income taxes
    
523
      
(70
)
    
(7
)
    
(16
)
Income taxes
    
(11
)
    
(8
)
    
(4
)
    
(4
)
Profit / (loss) for the period from continuing operations
    
512
      
(78
)
    
(11
)
    
(20
)
Profit / (loss) for the period from discontinued operations (after tax)
    
(4
)
    
66
      
(4
)
    
(3
)
Profit / (loss) for the period
    
508
      
(12
)
    
(15
)
    
(23
)
Attributable to:
                                
Kenon's shareholders
    
496
      
(34
)
    
(20
)
    
(23
)
Non-controlling interests
    
12
      
22
      
5
      
-
  
Profit / (loss) for the period
    
508
      
(12
)
    
(15
)
    
(23
)
Basic/diluted (loss)/profit per share attributable to Kenon's shareholders (in dollars):
                                
Basic/diluted profit/(loss) per share
    
9.22
      
(0.64
)
    
(0.38
)
    
(0.43
)
Basic/diluted profit/(loss) per share from continuing operations
    
9.29
      
(1.53
)
    
(0.31
)
    
(0.42
)
Basic/diluted profit per share from discontinued operations
    
(0.07
)
    
0.89
      
(0.07
)
    
(0.01
)


3
Kenon Holdings Ltd. and subsidiaries
Consolidated Statements of Cash Flows
 For the nine months ended September 30, 2018 and 2017
 
   
For the nine months ended
 September 30,
    
For the nine months ended
 September 30,
  
   
2018
    
2017
  
   
$ millions
  
Cash flows from operating activities
            
Profit / (loss) for the period
    
508
      
(12
)
Adjustments:
                
Depreciation and amortization
    
23
      
135
  
Financing expenses, net
    
1
      
204
  
Share in losses of associated companies, net
    
72
      
33
  
Write back of financial guarantee
    
(63
)
    
-
  
Gain on third party investment in Qoros
    
(504
)
    
-
  
Fair value loss on derivative asset
    
21
      
-
  
Net change in fair value of derivative financial instruments
    
1
      
-
  
Write back of other payables
    
(3
)
    
-
  
Impairment of assets
    
-
      
20
  
Bad debt expense
    
-
      
5
  
Other capital gains, net
    
-
      
(7
)
Share-based payments
    
1
      
1
  
Income taxes
    
15
      
61
  
     
72
      
440
  
Change in inventories
    
-
      
8
  
Change in trade and other receivables
    
3
      
(119
)
Change in trade and other payables
    
(15
)
    
(42
)
Changes in provisions and employee benefits
    
-
      
(2
)
     
60
      
285
  
Income taxes paid, net
    
(171
)
    
(43
)
Net cash (used in)/provided by operating activities
    
(111
)
    
242
  


4
 
Kenon Holdings Ltd and subsidiaries
Consolidated Statement of Cash Flows, continued
 For the nine months ended September 30, 2018 and 2017
 
   
For the nine months ended
 September 30,
  
   
2018
    
2017
  
   
$ millions
  
Cash flows from investing activities
            
Proceeds from sale of property, plant and equipment
    
-
      
5
  
Short-term deposits and loans, net
    
(27
)
    
(3
)
Investment in long term deposits, net
    
3
      
-
  
Cash paid for businesses purchased, less cash acquired
    
(2
)
    
-
  
Acquisition of property, plant and equipment
    
(39
)
    
(156
)
Acquisition of intangible assets
    
-
      
(3
)
Interest received
    
10
      
5
  
Proceeds from dilution of third party investment in Qoros
    
260
      
-
  
Receipt/(payment) to release financial guarantee
    
18
      
(72
)
Payment of transaction cost for sales of subsidiaries
    
(49
)
    
-
  
Energuate purchase adjustment
    
-
      
10
  
Sale of subsidiary, net
    
-
      
1
  
Insurance claim
    
-
      
40
  
Payment of investment obligation to Qoros
    
(90
)
    
-
  
Net cash provided by/(used in) investing activities
    
84
      
(173
)
                 
Cash flows from financing activities
                
Dividend paid to non-controlling interests in a subsidiary
    
(8
)
    
(17
)
Proceeds from issuance of shares to holders of non-controlling interests in subsidiaries
    
-
      
110
  
Capital distribution
    
(665
)
    
-
  
Receipt of long-term loans and issuance of debentures
    
28
      
1,314
  
Repayment of long-term loans and debentures
    
(126
)
    
(1,004
)
Repayment of short-term credit from banks and others, net
    
(319
)
    
(116
)
Payment of deferred expenses
    
(1
)
    
-
  
Bond issuance expenses
    
-
      
(20
)
Equity issuance expenses
    
-
      
(9
)
Payment of consent fee and early prepayment fee
    
-
      
(32
)
Interest paid
    
(18
)
    
(137
)
Net cash (used in)/provided by financing activities
    
(1,109
)
    
89
  
                 
(Decrease)/Increase in cash and cash equivalents
    
(1,136
)
    
158
  
Cash and cash equivalents at beginning of the period
    
1,417
      
327
  
Effect of exchange rate fluctuations on balances of cash and cash equivalents
    
(6
)
    
13
  
Cash and cash equivalents at end of the period
    
275
      
498
  


5
Information regarding reportable segments

The following table sets forth selected financial data for Kenon’s reportable segments for the periods presented:
 
 
  
For the nine months ended September 30, 2018
  
   
OPC
    
Quantum1
    
Other2
    
Adjustments3
    
Consolidated Results
  
   
(in millions of USD, unless otherwise indicated)
  
Sales
    
279
      
-
      
-
      
-
      
279
  
Depreciation and amortization
    
(23
)
    
-
      
-
      
-
      
(23
)
Financing income
    
1
      
9
      
45
      
(32
)
    
23
  
Financing expenses
    
(21
)
    
(2
)
    
(33
)
    
32
      
(24
)
Write back of financial guarantee
    
-
      
63
      
-
      
-
      
63
  
Gain on third party investment in Qoros
    
-
      
504
      
-
      
-
      
504
  
Fair value loss on derivative asset
    
-
      
(21
)
    
-
      
-
      
(21
)
Share in losses of associated companies
    
-
      
(49
)
    
(23
)
    
-
      
(72
)
Profit / (Loss) before taxes
    
37
      
503
      
(17
)
    
-
      
523
  
Income taxes
    
(10
)
    
-
      
(1
)
    
-
      
(11
)
Profit / (Loss) from continuing operations
    
27
      
503
      
(18
)
    
-
      
512
  
____________________________________
(1)
Quantum is a wholly-owned subsidiary of Kenon and holds Kenon's interest in Qoros.
(2)
Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses.
(3)
“Adjustments” includes inter-segment financing income and expenses.

 
  
For the nine months ended September 30, 20171
  
   
OPC
    
Quantum2
    
Other3
    
Adjustments4
    
Consolidated Results
  
   
(in millions of USD, unless otherwise indicated)
  
Sales
    
274
      
-
      
-
      
-
      
274
  
Depreciation and amortization
    
(23
)
    
-
      
-
      
-
      
(23
)
Financing income
    
1
      
-
      
11
      
(8
)
    
4
  
Financing expenses
    
(27
)
    
(9
)
    
(31
)
    
8
      
(59
)
Share in (losses) / profits of associated companies
    
-
      
(45
)
    
12
      
-
      
(33
)
Profit / (Loss) before taxes
    
17
      
(54
)
    
(33
)
    
-
      
(70
)
Income taxes
    
(7
)
    
-
      
(1
)
    
-
      
(8
)
Profit / (Loss) from continuing operations
    
10
      
(54
)
    
(34
)
    
-
      
(78
)
____________________________________
(1)
Results during this period have been reclassified to reflect the results of the Inkia power generation and distribution business (which was sold on December 31, 2017) as discontinued operations.
(2)
Quantum is a wholly-owned subsidiary of Kenon and holds Kenon's interest in Qoros.
(3)
Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses.
(4)
“Adjustments” includes inter-segment financing income and expenses.


6
 
 
  
For the three months ended September 30, 2018
  
   
OPC
    
Quantum1
    
Other2
    
Adjustments3
    
Consolidated Results
  
   
(in millions of USD, unless otherwise indicated)
  
Sales
    
94
      
-
      
-
      
-
      
94
  
Depreciation and amortization
    
(8
)
    
-
      
-
      
-
      
(8
)
Financing income
    
-
      
8
      
6
      
(3
)
    
11
  
Financing expenses
    
(6
)
    
-
      
(4
)
    
3
      
(7
)
Fair value loss on derivative asset
    
-
      
(8
)
    
-
      
-
      
(8
)
Share in losses of associated companies
    
-
      
(21
)
    
(1
)
    
-
      
(22
)
Profit / (Loss) before taxes
    
15
      
(22
)
    
-
      
-
      
(7
)
Income taxes
    
(4
)
    
-
      
-
      
-
      
(4
)
Profit / (Loss) from continuing operations
    
11
      
(22
)
    
-
      
-
      
(11
)
____________________________________
(1)
Quantum is a wholly-owned subsidiary of Kenon and holds Kenon's interest in Qoros.
(2)
Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses.
(3)
“Adjustments” includes inter-segment financing income and expenses.

 
  
For the three months ended September 30, 20171
  
   
OPC
    
Quantum2
    
Other3
    
Adjustments4
    
Consolidated Results
  
   
(in millions of USD, unless otherwise indicated)
  
Sales
    
97
      
-
      
-
      
-
      
97
  
Depreciation and amortization
    
(7
)
    
-
      
-
      
-
      
(7
)
Financing income
    
1
      
-
      
1
      
(2
)
    
-
  
Financing expenses
    
(5
)
    
(2
)
    
(10
)
    
2
      
(15
)
Share in losses of associated companies
    
-
      
(22
)
    
11
      
-
      
(11
)
Profit / (Loss) before taxes
    
14
      
(24
)
    
(6
)
    
-
      
(16
)
Income taxes
    
(4
)
    
-
      
-
      
-
      
(4
)
Profit / (Loss) from continuing operations
    
10
      
(24
)
    
(6
)
    
-
      
(20
)
____________________________________
(1)
Results during this period have been reclassified to reflect the results of the Inkia power generation and distribution business (which was sold on December 31, 2017) as discontinued operations.
(2)
Quantum is a wholly-owned subsidiary of Kenon and holds Kenon's interest in Qoros.
(3)
Includes the results of Primus; the results of ZIM, as an associated company; as well as Kenon’s and IC Green’s holding company and general and administrative expenses.
(4)
“Adjustments” includes inter-segment financing income and expenses.


7
 Information regarding associated companies

   
Carrying amounts of investment in associated companies
    
Equity in the net (losses) / earnings of associated companies
  
   
as at
    
For the nine months ended
    
For the three months ended
  
   
September 30, 2018
    
December 31, 2017
    
September 30, 2018
    
September 30, 2017
    
September 30, 2018
    
September 30, 2017
  
   
$ millions
    
$ millions
    
$ millions
  
ZIM
    
95
      
120
      
(23
)
    
12
      
(1
)
    
11
  
Qoros
    
167
      
2
      
(49
)
    
(45
)
    
(21
)
    
(22
)
     
262
      
122
      
(72
)
    
(33
)
    
(22
)
    
(11
)


8
 
Appendix B
 
Summary OPC consolidated financial information1
 
OPC’s Consolidated Statement of Profit

   
For the nine months ended
September 30,
    
For the three months ended
September 30,
  
   
2018
    
2017
    
2018
    
2017
  
   
(in millions of USD)
    
(in millions of USD)
  
Sales
    
279
      
274
      
94
      
97
  
Cost of sales (excluding depreciation and amortization)
    
(188
)
    
(200
)
    
(61
)
    
(70
)
Depreciation and amortization
    
(23
)
    
(23
)
    
(8
)
    
(7
)
Gross profit
    
68
      
51
      
25
      
20
  
General, selling and administrative expenses
    
(11
)
    
(8
)
    
(4
)
    
(2
)
Operating profit
    
57
      
43
      
21
      
18
  
Financing expenses
    
(21
)
    
(27
)
    
(6
)
    
(5
)
Financing income
    
1
      
1
      
-
      
1
  
Financing expenses, net
    
(20
)
    
(26
)
    
(6
)
    
(4
)
Profit before taxes
    
37
      
17
      
15
      
14
  
Taxes on income
    
(10
)
    
(7
)
    
(4
)
    
(4
)
Net profit for the period
    
27
      
10
      
11
      
10
  
Attributable to:
                                
Equity holders of the company
    
21
      
4
      
9
      
5
  
Non-controlling interest
    
6
      
6
      
2
      
5
  
Net profit for the period
    
27
      
10
      
11
      
10
  
____________________________________
(1)
Translations of NIS amounts into US Dollars use a rate of 3.56:1 for 2018 and 3.58:1 for 2017
 
9
Summary Data from OPC’s Consolidated Statement of Cash Flows
 
 
  
For the nine months ended
September 30,
    
For the three months ended
September 30,
  
   
2018
    
2017
    
2018
    
2017
  
   
(in millions of USD)
    
(in millions of USD)
  
Cash flows provided by operating activities
    
86
      
70
      
20
      
20
  
Cash flows used in investing activities
    
(74
)
    
(90
)
    
(35
)
    
(28
)
Cash flows (used in) / provided by financing activities
    
(23
)
    
173
      
10
      
71
  
(Decrease) / Increase in cash and cash equivalents
    
(11
)
    
153
      
(5
)
    
63
  
Effect of exchange rate fluctuations on balances of cash and cash equivalents
    
(6
)
    
3
      
2
      
7
  
Cash and cash equivalents at end of the period
    
129
      
179
      
129
      
179
  
Investments in property, plant and equipment
    
(39
)
    
(61
)
    
(10
)
    
(23
)
Total depreciation and amortization
    
23
      
23
      
8
      
7
  


10
Summary Data from OPC’s Consolidated Statement of Financial Position
 
   
As of
  
   
September 30,
2018
    
December 31, 2017
  
   
(in millions of USD)
  
Total financial liabilities1
    
609
      
618
  
Total monetary assets2
    
229
      
223
  
Total equity attributable to the owners
    
187
      
173
  
Total assets
    
955
      
941
  
____________________________________
1.
Including loans from banks and others and debentures
2.
Including cash and cash equivalents, short-term deposits and restricted cash.
 
11
Appendix C
 
Definition of OPC’s EBITDA and non-IFRS reconciliation
 
This press release, including the financial tables, presents EBITDA, which is considered to be a non-IFRS financial measure.
 
OPC defines EBITDA as for each period as net profit before depreciation and amortization, financing expenses, net, and income tax expense. EBITDA is not recognized under IFRS or any other generally accepted accounting principles as a measure of financial performance and should not be considered as a substitute for net profit or loss, cash flow from operations or other measures of operating performance determined in accordance with IFRS. EBITDA is not intended to represent funds available for dividends or other discretionary uses because those funds may be required for debt service, capital expenditures, working capital and other commitments and contingencies. There are limitations that impair the use of EBITDA as a measure of OPC's profitability since it does not take into consideration certain costs and expenses that result from OPC's business that could have a significant effect on net profit, such as financial expenses, taxes, depreciation, capital expenses and other related items.
 
OPC believes that the disclosure of EBITDA provides transparent and useful information to investors and financial analysts in their review of the company’s, or its subsidiaries’ operating performance and in the comparison of such operating performance to the operating performance of other companies in the same industry or in other industries that have different capital structures, debt levels and/or income tax rates.
 
Set forth below is a reconciliation of OPC’s net profit to EBITDA for the periods presented. Other companies may calculate EBITDA differently, and therefore this presentation of EBITDA may not be comparable to other similarly titled measures used by other companies.

   
For the nine months ended September
  
 
  
2018
    
2017
  
 
  
(in USD millions)
  
Net profit for the period
    
27
      
10
  
Depreciation and amortization
    
23
      
23
  
Financing expenses, net
    
20
      
26
  
Income tax expense
    
10
      
7
  
EBITDA
    
80
      
66
  
 
   
For the three months ended September 30,
  
 
  
2018
    
2017
  
 
  
(in USD millions)
  
Net profit for the period
    
11
      
10
  
Depreciation and amortization
    
8
      
7
  
Financing expenses, net
    
6
      
4
  
Income tax expense
    
4
      
4
  
EBITDA
    
29
      
25
  


12
 
Appendix D
 
Summary Financial Information of OPC’s Subsidiaries
 
The tables below set forth debt, cash and cash equivalents, deposits and restricted cash for OPC’s subsidiaries as of September 30, 2018:

 
  
OPC-Rotem
    
OPC-Hadera
    
Tzomet
    
OPC Energy & Others
    
Total OPC
  
 
                              
Debt (excluding accrued interest)
    
354
      
171
      
84
      
-
      
609
  
Cash and cash equivalents and short term deposits
    
39
      
27
      
91
      
-
      
157
  
Restricted cash (including debt service reserves) 
    
48
      
2
      
22
      
-
      
72
  
Debt service reserves
    
26
      
-
      
12
      
-
      
38
  
 
The tables below set forth debt, cash and cash equivalents, deposits and restricted cash for OPC’s subsidiaries as of December 31, 2017: 
 
 
 
  
OPC-Rotem
    
OPC-Hadera
    
OPC Energy & Others
    
Total OPC
  
 
                        
Debt (excluding accrued interest)
    
383
      
144
      
91
      
618
  
Cash and cash equivalents and short term deposits
    
38
      
30
      
79
      
147
  
Rrestricted cash (including debt service reserves)
    
48
      
2
      
26
      
76
  
Debt service reserves
    
26
      
-
      
5
      
31
  
 
13
Appendix E
 
Summary Operational Information of OPC
 
The tables below set forth details of sales, generation and purchases of electricity by OPC and availability and net generation of OPC split by the Rotem plant and the Hadera energy center (kWh in millions):
 
 
  
For the nine months ended
September 30,
    
For the three months ended
September 30,
  
 
  
2018
    
2017
    
2018
    
2017
  
Sales to private customers
    
2,915
      
2,907
      
942
      
975
  
Sales to the system administrator
    
70
      
73
      
23
      
11
  
Total sales
    
2,985
      
2,980
      
965
      
986
  

 
  
For the nine months ended
September 30,
    
For the three months ended
September 30,
  
 
  
2018
    
2017
    
2018
    
2017
  
Net generation of electricity
    
2,808
      
2,692
      
878
      
902
  
Purchase of electricity from the system administrator
    
177
      
288
      
87
      
84
  
Total volume of electricity generated and purchases from the system administrator
    
2,985
      
2,980
      
965
      
986
  

 
  
For the nine months ended September 30,
  
 
  
2018
    
2017
  
 
  
Availability
(%)
    
Net generation
(kWh in millions)
    
Availability
(%)
    
Net generation
(kWh in millions)
  
Rotem
    
98
%
    
2,746
      
93
%
    
2,632
  
Hadera
    
97
%
    
62
      
92
%
    
61
  
 
 
  
For the three months ended September 30,
  
 
  
2018
    
2017
  
 
  
Availability
(%)
    
Net generation
(kWh in millions)
    
Availability
(%)
    
Net generation
(kWh in millions)
  
Rotem
    
93
%
    
858
      
99
%
    
887
  
Hadera
    
99
%
    
20
      
84
%
    
16
  

 
14

Appendix F
 
Summary of Qoros’ Unaudited Condensed Consolidated Financial Information

   
For the nine months ended
September 30,
    
For the three months ended
September 30,
  
In millions of RMB
  
2018
    
2017
    
2018
    
2017
  
                         
Revenue
    
4,417
      
984
      
1,531
      
306
  
Cost of sales
    
(5,051
)
    
(1,248
)
    
(1,831
)
    
(397
)
 
                                
Gross loss
    
(634
)
    
(264
)
    
(300
)
    
(91
)
Other income
    
36
      
313
      
8
      
4
  
Research and development expenses
    
(82
)
    
(81
)
    
(17
)
    
(1
)
Selling, general and administrative expenses
    
(499
)
    
(316
)
    
(241
)
    
(115
)
Other expenses
    
(2
)
    
(11
)
    
(1
)
    
(2
)
Loss from operation
    
(1,181
)
    
(359
)
    
(551
)
    
(205
)
Finance income
    
29
      
8
      
10
      
2
  
Finance costs
    
(210
)
    
(259
)
    
(80
)
    
(82
)
Net finance cost
    
(181
)
    
(251
)
    
(70
)
    
(80
)
Loss for the period
    
(1,362
)
    
(610
)
    
(621
)
    
(285
)
 
15
Qoros’ Consolidated Statement of Financial Position
 
 
  
As of
September 30,
    
As of
December 31,
  
In millions of RMB
  
2018
    
2017
  
Assets
            
Property, plant and equipment
    
3,694
      
3,875
  
Intangible assets
    
3,757
      
4,011
  
Prepayments
    
31
      
22
  
Lease prepayments
    
191
      
195
  
Trade and other receivables
    
92
      
91
  
Equity-accounted investees
    
1
      
2
  
Non-current assets
    
7,766
      
8,196
  
Inventories
    
547
      
389
  
VAT recoverable
    
570
      
828
  
Trade and other receivables
    
2,076
      
38
  
Prepayments
    
298
      
173
  
Pledged deposits
    
410
      
26
  
Cash and cash equivalents
    
552
      
77
  
 
                
Current assets
    
4,453
      
1,531
  
 
                
Total assets
    
12,219
      
9,727
  
 
                
Equity
                
Paid-in capital
    
16,925
      
10,425
  
Reserves
    
-
      
54
  
Accumulated losses
    
(13,081
)
    
(11,645
)
 
                
Total equity/(deficit)
    
3,844
      
(1,166
)
 
                
Liabilities
                
Loans and borrowings
    
3,393
      
4,228
  
Deferred income
    
153
      
161
  
Trade and other payables
    
67
      
1,208
  
Provisions
    
108
      
65
  
 
                
Non-current liabilities
    
3,721
      
5,662
  
 
                
Loans and borrowings
    
1,527
      
2,511
  
Trade and other payables
    
3,095
      
2,704
  
Deferred income
    
32
      
16
  
 
                
Current liabilities
    
4,654
      
5,231
  
 
                
Total liabilities
    
8,375
      
10,893
  
 
                
Total equity and liabilities
    
12,219
      
9,727
  
 

16
Appendix G
 
Definition of Qoros’ Adjusted EBITDA and non-IFRS Reconciliation
 
This press release presents the Adjusted EBITDA of Qoros, which is a financial metric considered to be a non-IFRS financial measure. Non-IFRS financial measures should be evaluated in conjunction with, and are not a substitute for, IFRS financial measures. The non-IFRS financial information presented herein should not be considered in isolation from or as a substitute for operating profit, net profit or per share data prepared in accordance with IFRS.
 
Qoros defines Adjusted EBITDA for each period as net loss for the period, excluding net finance costs, depreciation and amortization and Other Income-license rights. Adjusted EBITDA is not recognized under IFRS or any other generally accepted accounting principles as a measure of financial performance and should not be considered as a substitute for net profit or loss, cash flow from operations or other measures of operating performance or liquidity determined in accordance with IFRS. Adjusted EBITDA is not intended to represent funds available for dividends or other discretionary uses because those funds may be required for debt service, capital expenditures, working capital and other commitments and contingencies. Adjusted EBITDA presents limitations that impair its use as a measure of our profitability since it does not take into consideration certain costs and expenses that result from our business that could have a significant effect on our net profit, such as financial expenses, taxes, depreciation, capital expenses and other related charges.
 
Qoros believes that the disclosure of Adjusted EBITDA provides transparent and useful information to investors and financial analysts in their review of Qoros’ operating performance and in the comparison of such operating performance to the operating performance of other companies in the same industry or in other industries that have different capital structures, debt levels and/or income tax rates.
 
Set forth below is a reconciliation of Qoros’ net loss to Adjusted EBITDA for the periods presented. Other companies may calculate Adjusted EBITDA differently, and therefore this presentation of Adjusted EBITDA may not be comparable to other similarly titled measures used by other companies.

 
  
For the nine months ended September 30,
    
For the three months ended September 30,
  
In millions of RMB
  
2018
    
2017
    
2018
    
2017
  
Net loss for the period
    
(1,362
)
    
(610
)
    
(621
)
    
(285
)
Net finance costs
    
181
      
251
      
70
      
80
  
Depreciation and Amortization
    
660
      
293
      
272
      
90
  
Other income – license rights
    
-
      
(270
)
    
-
      
-
  
Adjusted EBITDA
    
(521
)
    
(336
)
    
(279
)
    
(115
)

 
17