81
Notes to the Consolidated Financial Statements (continued)
For the year ended 31 December, 2012
(Expressed in Thousands of Trinidad and Tobago Dollars, except where otherwise stated)
26. Assets classified as held for sale
The operations of two of theGroup’s subsidiaries namely IslandConcrete Products N.V. and IslandConcrete SARL located
in St. Maarten and St. Martin respectively, were suspended effective 1 December, 2009 and subsequently disposed in
2011, due to a major decline in the demand for concrete on the island. The Group recognised a gain of $11.092 million in
2011 on disposal of these subsidiaries.
As at 31 December, 2010, the subsidiarieswere classified as a disposal group held for sale and as a discontinued operation.
The net assets and results of the subsidiary for the years ended 31 December, 2012 and 2011 are presented below:
2012
2011
$
$
Revenue
–
–
Expenses
–
(1,681)
Operating loss
–
(1,681)
Finance costs
–
–
Loss before tax from discontinued operations
–
(1,681)
Taxation
–
–
Loss for the year from discontinued operations
–
(1,681)
27. Debt restructuring
In 2010Trinidad Cement Limited (TCL) commenced negotiations with its lenders for the restructuring of its debt portfolio.
On 14 January, 2011, TCLdeclared amoratoriumon debt service payments by all entities in the Group and thereafter debt
service payments falling due were not paid by TCL and its subsidiaries (the “TCL Group”).
Debt agreements covering loans amounting to $1,673 million in the TCL Group as at 31 December, 2011 were therefore
in default. However, lenders did not seek to enforce their security and legal rights, which remained unchanged whilst
negotiations were in progress with TCL. By 31 December, 2011, TCL and its lenders had reached agreement in principle
on the features of the restructuring and its key terms.
On 10May, 2012, the agreements to give effect to the debt restructuring were executed by the Group with the lenders and
these financial statements have been prepared in accordance with the restructuring agreements. Under the terms of the
new agreement interest payments on the outstanding debt amounting to $51 million was paid on 30 December, 2012. As
described in Note 16, payments of principal and interest on the restructured debt has been synchronised into quarterly
installments from March 2013 through December 2018, with the last principal payment being 43% of the restructured
debts.
The override agreement has imposed the following key covenants and restrictions on the TCL Group:
a)
Compliance with certain financial covenants for the TCL Group commencing from 31 March, 2013 and quarterly
thereafter.This includes a consolidated coverage ratio (ratio of EBITDA to Interest), consolidated leverage ratio (ratio
of Debt to EBITDA) and consolidated total liabilities to tangible net worth (ratio of Total Liabilities to Shareholders’
Equity).
b) The TCL Group’s capital expenditure cannot exceed US$15 million (excluding Readymix W.I. Limited and TCL
Packaging Limited).
c)
Dividends cannot exceed US$3 million per annum and can only be paid when Debt/EBITDA is less than or equal
to 3.
d) At each quarter end, if cash balance is greater than US$15 million after accounting for any impending debt service
payment, the excess is payable to lenders as an additional debt service payment.
