NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
REPORT OF THE DIRECTORS
FOR THE FINANCIAL YEAR 31 MARCH 2022
1
Directors
Jason Peter Klopfer
Philip Andrew Stone
Jonathan Keats
Secretary
Jonathan Keats
The directors present their report and the audited consolidated financial statements of Navig8 Topco Holdings
Inc and its subsidiaries (the “Group”) for the financial year ended 31 March 2022.
Principal Activities
The principal activities of the Group are shipping-related. It includes shipowning and chartering, brokerage
and commercial management, bunker trading and risk management.
Results for the Year
The results of the Group for the financial year are presented on page 8.
Dividends
A dividend of US$4.0 million (2021: US$43.0 million) was approved by the Board of directors in July 2022
and paid out as an appropriation of retained earnings for the financial year ended 31 March 2022.
Directors Responsibilities
The directors are responsible for preparing the consolidated financial statements of the Group for the financial
year ended 31 March 2022 which give a true and fair view of the state of affairs of the Group and the results
of the Group for the financial year then ended. In preparing these consolidated financial statements the
directors have:
- selected suitable accounting policies and applied them consistently;
- made adjustments and estimates that are responsible and prudent;
- followed applicable accounting standards; and
- prepared the consolidated financial statements on a going concern basis.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
REPORT OF THE DIRECTORS
FOR THE FINANCIAL YEAR 31 MARCH 2022
2
Directors Responsibilities (cont’d)
The directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at
any time the financial position of the Group and to ensure that the consolidated financial statements comply
with International Financial Reporting Standards. They are also responsible for safeguarding the assets of the
Group by taking reasonable steps to prevent and detect fraud and other irregularities.
At the date of this statement, there are reasonable grounds to believe that the Group will be able to pay its
debts as and when they fall due.
Independent Auditors
Moore Stephens LLP, Public Accountants and Chartered Accountants, have expressed their willingness to
continue in office and a resolution for their re-appointment will be proposed at the forthcoming Annual
General Meeting.
The report of the directors was authorised by the Board on 12 July 2022
and signed on its behalf by,
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
3
Opinion
We have audited the consolidated financial statements of Navig8 Topco Holdings Inc (the “Company”) and
its subsidiaries (the “Group”) which comprise the consolidated balance sheet as at 31 March 2022 and the
consolidated statement of comprehensive income, consolidated statement of changes in equity and
consolidated statement of cash flows for the financial year then ended, and notes to the consolidated financial
statements, including a summary of significant accounting policies.
In our opinion, the accompanying consolidated financial statements give a true and fair view of the
consolidated balance sheet of the Group as at 31 March 2022, and its consolidated financial performance and
its consolidated cash flows for the year then ended in accordance with International Financial Reporting
Standards (“IFRSs”).
Basis for Opinion
We conducted our audit in accordance with International Standards on Auditing (“ISAs”). Our responsibilities
under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated
Financial Statements section of our report. We are independent of the Group in accordance with the
International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (“IESBA
Code”) and we have fulfilled our other ethical responsibilities in accordance with the IESBA Code. We believe
that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key Audit Matter
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit
of the financial statements of the current period. These matters were addressed in the context of our audit of
the financial statements as a whole and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
4
(cont’d)
Key Audit Matter (cont’d)
Key Audit Matter How our audit addressed the key audit
matter
Impairment assessment of vessels
Our response
We refer to Note 2(l), Note 2(o), Note 3(a)(i), Note
13 and Note 18 to the financial statements.
The carrying value of the Group’s vessels and right-
of-use assets (time-chartered vessels) amounted to
US$608.0 million and US$55.5 million as at 31
March 2022.
The Group’s vessels are measured at cost less
accumulated depreciation and impairment loss.
Management considers each vessel to be a separate
cash generating unit.
Management carried out a detailed impairment
review of the vessels. Management determined the
recoverable amount for each vessel based on the
higher of the fair value of the vessel less the
estimated costs of disposal and the carrying value of
the vessels based on the “value-in-use”
methodology. As a result of the assessment,
management concluded that the recoverable amount
was higher than the carrying values and no
impairment loss has been recognised for the
financial year ended 31 March 2022.
These conclusions are dependent upon management
estimates, judgements and assumptions in respect of
estimated resale values provided by third party
sources, estimated utilisation, disposal values,
residual values, current and historical charter hire
rates, operating costs, recent performance, condition
of the vessels and pre-tax discount rates.
We assessed the methodologies used by
management to estimate the value-in-use
calculations of the vessels. We checked the accuracy
and relevance of the input data used by management
to estimate the value-in-use calculations compared
to information obtained from reputable industry
sources. We performed a sensitivity analysis and
headroom analysis on the key assumptions, where
necessary.
We found the significant estimates, judgements and
assumptions made by management to determine the
recoverable amounts of the vessels to be reasonable
based on available evidence.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
5
(cont’d)
Other Information
Management is responsible for the other information. The other information comprises the information
included in the Annual Report but does not include the consolidated financial statements and our auditor’s
report thereon.
Our opinion on the consolidated financial statements does not cover the other information and we do not
express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent with the
financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and Directors for the Consolidated Financial Statements
Management is responsible for the preparation of the consolidated financial statements that give a true and
fair view in accordance with IFRSs, and for such internal control as management determines is necessary to
enable the preparation of consolidated financial statements that are free from material misstatement, whether
due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Group’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless management either intends to liquidate the Group or to cease operations,
or has no realistic alternative but to do so.
The directors are responsible for overseeing the Group’s financial reporting process.
Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that
includes our opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit
conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements
can arise from fraud or error and are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated
financial statements.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
6
(cont’d)
Auditor’s Responsibilities for the Audit of the Financial Statements (cont’d)
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional
skepticism throughout the audit. We also:
Identify and assess the risks of material misstatement of the consolidated financial statements, whether
due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting
a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal
control.
Obtain an understanding of internal control relevant to the audit in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the Group’s internal control.
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the management.
Conclude on the appropriateness of management’s use of the going concern basis of accounting and
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to
the related disclosures in the consolidated financial statements or, if such disclosures are inadequate,
to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our
auditor’s report. However, future events or conditions may cause the Group to cease to continue as a
going concern.
Evaluate the overall presentation, structure and content of the consolidated financial statements,
including the disclosures, and whether the consolidated financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the consolidated financial statements.
We are responsible for the direction, supervision and performance of the group audit. We remain
solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies in internal control that we identify during
our audit.
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
7
(cont’d)
Auditor’s Responsibilities for the Audit of the Financial Statements (cont’d)
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters that
may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of most significance
in the audit of the consolidated financial statements of the current period and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure
about the matter or when, in extremely rare circumstances, we determine that a matter should not be
communicated in our report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditor’s report is Christopher Bruce
Johnson.
Moore Stephens LLP
Public Accountants and
Chartered Accountants
Singapore
12 July 2022
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
8
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
Note
2022
2021
US$’000
US$’000
Revenue
5
Operating expenses
6
(3,395,699
)
(2,653,367 )
(Impairment loss)/w
rite
back of impairment on trade receivables, net
6
(1,324 )
Profit from operations
Other income
7
Other expenses
8
(2,144 )
(7,201 )
Administrative expenses
9
(
)
(61,213 )
Finance income
10
Finance costs
11
(42,727 )
(50,929 )
Share of profits
/(losses)
in associates
16
(400 )
Share of profits in joint ventures
17
Profit before income tax
Income tax expense
12
(
(2,006 )
Net profit for the year
Other comprehensive income:
Items that will not be reclassified subsequently to profit or loss
Fair value gain recognised on financial assets
at fair value through other comprehensive income
15
Items that may be reclassified subsequently to profit or loss
Cash flow hedges
–
fair value (losses)
/gains
15
(599 )
Other comprehensive income, net of tax
Total comprehensive income for the financial year
Net profit for the year attributable to:
Owners of the Group
Non
-
controlling interests
24
Total
comprehensive income attributable to:
Owners of the Group
Non
-
controlling interests
24
Earnings per share
Basic
35
Diluted
35
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
9
CONSOLIDATED BALANCE SHEET
AS AT 31 MARCH 2022
Note
2022
2021
US$’000
US$’000
ASSETS
Non-Current Assets
Vessels
13
Other fixed assets
14
Interests in associates
16
Interests in joint ventures
17
Right
-
of
-
use assets
18
Current Assets
Inventories
19
Trade and other receivables and prepayments
20
Accrued receivables
20
Financial assets
15
Cash and bank balances
21
Total Assets
EQUITY AND LIABILITIES
Share Capital and Reserves
Share capital
22
Reserves
23
Total equity attributable to the owners of the Group
Non-controlling interests
24
Non-Current Liabilities
Bank loan
25
Other borrowings
26
Lease liabilities
29
Current Liabilities
Bank loan
25
Other borrowings
26
Lease liabilities
29
Short-term borrowings
27
Trade and other payables
28
Income tax liabilities
Total Liabilities
Total Equity and Liabilities
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
10
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
Attributable to equity owners of the Group
Share
c
apital
Other
r
eserves
Retained
e
arnings
Total
attributable
to owners of
the Group
Non-
controlling
i
nterests
Total
e
quity
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000
Balance as at 1 April 2021
(9,814 )
Net profit for the year
Other comprehensive income
Total comprehensive income
for the financial year
Dividends paid to non-
controlling interest (Note 24)
(2,196 )
(2,196 )
Effect of change
of interest in subsidiaries
(394 )
(31 )
Balance as at 31 March 2022
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
11
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
(cont’d)
Attributable to equity owners of the Group
Share
capital
Other
reserves
Retained
earnings
Total
attributable
to owners of
the Group
Non-
controlling
i
nterests
Total
equity
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000
Balance as at 1 April 2020
(4,333 )
Net profit for
the year
Other comprehensive income
Total comprehensive income
for the financial year
Dividends paid to
the ultimate holding company
(43,000 )
(43,000 )
(43,000 )
Dividends paid to non-
controlling interest (Note 24)
(2,793 )
(2,793 )
Acquisition of additional
interest in subsidiary (Note
4(A))
(10,292 )
(10,292 )
(2,479 )
(12,771 )
Effect of change
of interest in subsidiaries
(632 )
Exercise of share options
Balance as at 31 March 2021
(9,814 )
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
12
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
2022
2021
US$’000
US$’000
Cash Flows from Operating Activities
Profit before income tax
Adjustments for:
Depreciation of right
-
of
-
use assets
Depreciation of vessels, other fixed assets and
amortisation of dry
-
docking costs
Interest expense
Interest income
(55
)
(185 )
Impairment loss on trade receivables
Write back of impairment loss on trade receivables
(2,832 )
(4,891 )
Bad debts write
back
(89 )
(173 )
Share of (profits)
/losses
in associates
(26 )
Share of profits in joint ventures
(1,014 )
(242 )
Gain on
sale of vessel
s
(12,269 )
Gain on
step
acquisition of
interest in a former associate to a
subsidiary
(190 )
Dividend income from financial assets
(83 )
(29 )
Gain on financial assets
(3,440 )
(8,315 )
Operating cash flows before working capital changes
Changes in working capital:
Inventories
(12,010 )
Trade and other receivables
and prepayments (including accrued receivables)
(184,465
)
Trade and other payables
(107,611 )
Cash generated from operations
Income tax paid
(1,056 )
(2,794 )
Interest received
Interest paid
(42,282
)
(50,470 )
Net cash generated from operating activities 4,962 248,957
Cash Flows from Investing Activities
Payments for vessels and dry
-
docking costs
(2,479 )
Purchase of other fixed assets
(178 )
(315 )
Proceeds from sale of vessels
Purchase of financial assets
(7,666 )
(13,078 )
Proceeds from disposal of financial assets
Dividends received from financial assets
Additional investments in associates and joint ventures
(1,090
)
(12 )
Dividends received from associates and joint ventures
Payment for prepaid tax on share of profits in associates
(162 )
(60 )
Equity loan
(
repayment from
)/to
associates
(
Net cash inflow from step acquisition of interest in a former associate to
a subsidiary
Net cash generated from investing activities
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
13
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
(cont’d)
2022
2021
US$’000
US$’000
Cash Flows from Financing Activities
Dividends paid to ultimate holding company
(
)
Dividends paid to non
-
controlling interests
(2,196 )
(
)
Deposit pledged with financial institutions
Proceeds from exercise of share options
Acquisition of additional interest
s
in subsidiaries
(12,771 )
Proceeds from bank loan and other borrowings
Proceeds from/
(
r
epayment of) short
-
term borrowing
(87,275 )
Repayment of bank loan and other borrowings
(165,097 )
(
)
Principal payment of lease liabilities
(37,327 )
(
)
Net cash used in from financing activities
(132,846 )
(248,199 )
Net
(decrease)/
increase in cash and bank balances
(31,074
)
Cash and bank balances at the beginning of the
financial year
Cash and bank balances at the end of the financial year
(Note 21)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
14
These notes form an integral part of and should be read in conjunction with the accompanying financial
statements.
1 General
Ajeltake Island, Majuro, Marshall Islands MH96960.
The Company is principally an investment holding company. The principal activities of the Company,
its subsidiaries and joint ventures (collectively, the “Group”) are shipping-related. It includes
shipowning and chartering, brokerage and commercial management, bunker trading and risk
management. Details of principal activities, countries of incorporation and extent of the Company’s
equity interest in subsidiaries are set out in Note 4 to the consolidated financial statements.
The immediate and ultimate holding company has appointed its subsidiary, Navig8 Asia Pte. Ltd., to
act as the commercial manager for its principal shipping-related activities. Navig8 Asia Pte. Ltd.’s
registered office and principal place of business is 5 Shenton Way, #20-04 UIC Building, Singapore
068808.
The Company’s immediate and ultimate holding company is Navig8 Limited
at c/o Cohort Limited, Sofia House, 3
rd
Floor, 48 Church Street, Hamilton HM12, Bermuda. In the
opinion of the directors, the Group has no controlling party.
The Board of Directors has authorised the issue of the consolidated financial statements on the date
of the Report of the Directors.
2 Significant Accounting Policies
(a) Basis of Preparation
The consolidated financial statements which are expressed in United States dollar, have been prepared
in accordance with the International Financial Reporting Standards (“IFRS”). The consolidated
financial statements have been prepared under the historical cost convention, except as disclosed in
the accounting policies below.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
15
2 Significant Accounting Policies (cont’d)
(a) Basis of Preparation (cont’d)
The preparation of consolidated financial statements in conformity with IFRS requires management
to exercise judgment in the process of applying the Group’s accounting policies. It also requires the
use of certain critical accounting estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosures of contingent assets and liabilities at the balance sheet date and the
reported amounts of revenues and expenses during the financial year. Although these estimates are
based on management’s best knowledge of current events and actions, actual results may actually
differ from these estimates. The areas involving a higher degree of judgment or complexity, or areas
where assumptions and estimates are significant to the financial statements are disclosed in Note 3 to
the consolidated financial statements.
The accounting policies adopted are consistent with those of the previous financial year except that in
the current financial year, the Group has adopted all the new and revised IFRSs issued that are relevant
to its operations and effective for annual periods beginning on 1 April 2021.
New and Revised IFRS Issued But Not Yet Effective
As at the date of these consolidated financial statements, the Group has not adopted the following
amendments to standards that have been issued but are not yet effective:
Description
Effective for annual
periods beginning on
or after
Amendments to IAS 16 Property, Plant and Equipment - Proceeds before
Intended Use
1 January 2022
Amendments to IAS 37 Provisions - Onerous Contracts
-
Cost of Ful
filling a Contract
1 January 2022
Amendments to IFRS 3 Business Combinations
-
Reference to the Conceptual Framework
1 January 2022
Annual Improvements to IFRS Standards 2018-2020 Cycle
-
IFRS 9
Financial Instruments
1 January 2022
Amendments to IAS 1 Classification of Liabilities as Current and Non-
Current
1 January 2023
Amendments to IAS 1, Disclosure of Accounting Policies and IFRS
Practice Statement 2 Making
Materiality Judgements
1 January 2023
Amendments to IAS 8 Accounting Policies, Changes in Accounting
Estimates and Errors: Definition of Accounting Estimates
1 January 2023
Amendments to IAS 12, Deferred tax related to Assets and Liabilities
arising from a Single Transaction
1 January 2023
Management is of the view that the adoption of the amendments above will have no material impact
on the consolidated financial statements in the period of initial application.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
16
2 Significant Accounting Policies (cont’d)
(a) Basis of Preparation (cont’d)
New and Revised IFRS Issued But Not Yet Effective (cont’d)
Amendments to IAS 16 Property, Plant and Equipment – Proceeds Before Intended Use
The amendments prohibit an entity deducting from the cost of an item of property, plant and
equipment any proceeds from selling items produced while bringing that asset to the location and
condition necessary for it to be capable of operating in the manner intended by management. Instead,
an entity recognises the proceeds from selling such items, and the cost of producing those items, in
profit or loss.
Amendments to IAS 37 Provisions - Onerous Contracts - Cost of Fulfilling a Contract
The amendments clarify that for the purpose of assessing whether a contract is onerous, the cost of
fulfilling the contract includes both the incremental costs of fulfilling that contract and an allocation
of other costs that relate directly to fulfilling contracts.
Amendments to IFRS 3 Business Combinations - Reference to the Conceptual Framework
The amendments confirm that a business must include inputs and a process. The amendments also
clarify that the process must be substantive, and the inputs and process must significantly contribute
to creating outputs. The revised definition of a business focuses on goods and services provided to
customers and other income from ordinary activities, rather than on providing dividends or other
economic benefits directly to investors or lowering costs. A new optional test is available to assess
whether a business has been acquired, when the value assets acquired is concentrated in a single asset
or group of similar assets.
IFRS 9 Financial Instruments - Fees in the ‘10 per cent’ test for derecognition
This amendment clarifies that, for the purpose of performing the “10 per cent test” in paragraph B3.3.6
of IFRS 9, a borrower includes only fees paid or received between the entity (the borrower) and the
lender, including fees paid or received by either the entity or the lender on the other’s behalf.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
17
2 Significant Accounting Policies (cont’d)
(a) Basis of Preparation (cont’d)
New and Revised IFRS Issued But Not Yet Effective (cont’d)
Amendments to IAS 1, Classification of Liabilities as Current or Non-current
The amendments require that the classification of liabilities as current or non-current must be based
on rights that are in existence at the end of the reporting period. The classification is unaffected by
management’s intentions or expectations about whether an entity will exercise its right to defer
settlement of a liability. The amendments clarify that a counterparty conversion option that is
recognised separately as an equity component of a compound financial instrument does not affect the
classification of the associated liability component as current or non-current. All other obligations to
transfer equity instruments, cash, assets and liabilities, affect the classifications. The amendments
should be applied retrospectively.
Amendments to IAS 1, Disclosure of Accounting Policies and IFRS Practice Statement 2 Making
Materiality Judgements
The amendments require entities to disclose their material accounting policies information rather than
their significant accounting policies. It clarifies that accounting policy information may be material
because of its nature, even if the related amounts are immaterial. Accounting policy information is
material if users of an entity’s financial statements would need it to understand other material
information in the financial statements. If an entity discloses immaterial accounting policy
information, such information shall not obscure material accounting policy information. To support
this amendment, the IASB has also amended IFRS Practice Statement 2 to explain and demonstrate
the application of the materiality process to accounting policy disclosures.
Amendments to IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors:
Definition of Accounting Estimates
The amendments replace the definition of a change in accounting estimates with a new definition of
accounting estimates. Accounting estimates are defined as monetary amounts in financial statements
that are subject to measurement uncertainty. The amendments also clarify that a change in accounting
estimate that results from new information or new developments is not the correction of an error. In
addition, the effects of a change in an input or a measurement technique used to develop an accounting
estimate are changes in accounting estimates if they do not result from the correction of prior period
errors.
Amendments to IAS 12, Deferred tax related to Assets and Liabilities arising from a Single
Transaction
The amendment introduces an exception to the initial recognition exemption in IAS 12. Applying this
exception, an entity does not apply the initial recognition exemption for transactions that give rise to
equal taxable and deductible temporary differences. The amendments apply to transactions that occur
on or after the beginning of the earliest comparative period presented. The amendments also apply to
taxable and deductible temporary differences associated with right-of-use assets and lease liabilities,
and decommissioning obligations and corresponding amounts recognised as assets at the beginning
of the earliest comparative period presented.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
18
2 Significant Accounting Policies (cont’d)
(b) Functional Currency and Foreign Currency Translation
Functional and presentation currency
Items included in the consolidated financial statements of each entity in the Group are measured using
the currency of the primary economic environment in which the entity operates (the “functional
currency”). The consolidated financial statements of the Group are presented in United States dollar
(US$), which is also the functional and presentation currency of the Company. All values are rounded
to the nearest thousand (US$’000) except when otherwise indicated.
Translation and balances
Transactions in a currency other than the functional currency (“foreign currency”) are translated into
the functional currency using the exchange rates prevailing at the dates of transactions. Currency
exchange differences resulting from the settlement of such transactions and from the translation of
monetary assets and liabilities denominated in foreign currencies at the closing rates at the balance
sheet date are recognised in profit or loss.
Non-monetary items that are measured in terms of historical cost in a foreign currency shall be
translated using the exchange rate at the date of the transaction; and non-monetary items that are
measured at fair value in a foreign currency shall be translated using the exchange rates at the date
when the fair value was determined.
The results and financial position of all the Group entities (none of which has the currency of a
hyperinflationary economy) that have a functional currency different from the Group’s presentation
currency are translated into the presentation currency as follows:
i. assets and liabilities are translated at the closing rates at the reporting date;
ii. income and expenses are translated at average exchange rates (unless the average is not a
reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates,
in which case income and expenses are translated using the exchange rates at the dates of the
transactions); and
iii. all resulting exchange differences are recognised in other comprehensive income and accumulated
in the currency translation reserve within equity. These currency translation differences are
reclassified to profit or loss as disposal or partial disposal (i.e. loss of control) of the entity giving
rise to such reserve. Any currency translation differences that have previously been attributed to
non-controlling interests are de-recognised, but they are not reclassified to profit or loss.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
19
2 Significant Accounting Policies (cont’d)
(c) Revenue Recognition
Revenue is measured based on the consideration to which the Group expects to be entitled in exchange
for transferring promised goods or services to a customer, excluding amounts collected on behalf of
third parties. Revenue is recognised when the Group satisfies a performance obligation by transferring
a promised good or service to the customer, which is when the customer obtains control of the good
or service. A performance obligation may be satisfied at a point in time or over time. The amount of
revenue recognised is the amount allocated to the satisfied performance obligation.
A contract asset (accrued receivables) is the Group’s right to consideration in exchange for goods or
services that the entity has transferred to a customer. If a customer pays consideration or the Group
has a right to an amount of consideration that is unconditional, before the Group transfers a good or
service to the customer, the Customer presents the contract as a contract liability (deferred income)
when the payment is made or a receivable is recorded (whichever is earlier). A contract liability is the
Group’s obligation to transfer goods or services to a customer for which the Group has received
consideration (or an amount of consideration is due) from the customer. A receivable is recorded when
the Group has an unconditional right to consideration. A right to consideration is unconditional if only
the passage of time is required before payment of that consideration is due.
Bunker trading income
Bunker trading income is recognised at a point in time when the ownership of the bunkers has been
transferred to the customer.
Voyage charter freight income
Voyage charter freight income is recognised over time as the performance obligation is satisfied, based
on the percentage of completion method calculated on a load-to-discharge basis over the voyage
period. The Group capitalised any pre-voyage related costs as they were incremental and expected to
be recovered. Full provision is made for any losses on voyages in progress at the reporting date.
Time and bareboat charter income
Time charter and bareboat charter income is recognised on a time-apportioned basis over the charter
period. Provision is made for all charter-hire receivables on the reporting date in respect of time charter
voyages in progress.
Commission income and administration fees
Commission income relates to the commercial management services provided. Commission income
is recognised on completion of the related voyage or charter period. Sale and purchase commission
income relates to the services provided for newbuilding vessels. It is recognised in line with the
payment of instalments to shipyards. Administration fees are recognised over time based on vessel
trading days for vessels under management.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
20
2 Significant Accounting Policies (cont’d)
(c) Revenue Recognition (cont’d)
Pool revenue and expenses
Pool revenue is measured based on a time charter equivalent basis based on voyage returns adjusted
for off-hire days and pool score allocated to each vessel on entry into the Pools. Pool revenue and
voyage expenses are recognised in accordance with the earnings allocated to the Group’s vessels.
Management fees
Management fees are recognised over the service period.
Gain from derivatives and securities trading
Gain from derivatives and securities trading comprises all fair value gains or losses resulting from
financial derivatives contracts and securities trading. All open contracts and securities are marked to
market based on the quoted market prices at the reporting date.
Interest income
Interest income is recognised on an accrued basis using the effective interest method.
(d) Employee Benefits
Short-term benefits
All short-term employee benefits including accumulating compensated absences are recognised in
profit or loss in the period in which the employees rendered their services to the Group.
Defined contribution plans
Defined contribution plans are post-employment benefit plans under which the Group pays fixed
contributions into separate entities such as the Central Provident Fund and will have no legal or
constructive obligation to pay further contributions if any of the funds do not hold sufficient assets to
pay all employee benefits relating to employee services in the current financial year. The Group’s
contribution to defined contribution plans are recognised in the financial year to which they relate.
Employee leave entitlement
Employees’ entitlement to annual leave is recognised when accrued. A provision is made for the
estimated liability for annual leave as a result of services rendered by employees up to the balance
sheet date.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
21
2 Significant Accounting Policies (cont’d)
(e) Interest Expense
Interest expense is recognised in profit or loss using the effective interest method except for those
costs that are directly attributable to bank loans acquired specifically for the acquisition or
construction of qualifying assets. The actual borrowing cost incurred for such qualifying assets during
the relevant period are capitalised in the cost of the qualifying assets.
(f) Income Taxes
Tax expense comprises income tax and deferred tax.
Income tax for current and prior years is recognised at the amount expected to be paid to or recovered
from the tax authorities, using the tax rates and tax laws that have been enacted or substantively
enacted by the balance sheet date. The Group periodically evaluates positions taken in tax returns with
respect to situations in which applicable tax regulation is subject to interpretation. It establishes
provisions, where appropriate, on the basis of amount expected to be paid to the tax authorities.
Deferred tax is recognised on temporary differences between the carrying amounts of assets and
liabilities in the consolidated financial statements and the corresponding tax bases used in the
computation of taxable profits and is accounted for using the balance sheet liability method. Deferred
tax is calculated at the tax rates that are expected to apply in the year in which the liability is settled
or the asset utilised, based on tax rates and tax laws that have been enacted or substantively enacted
by the balance sheet date.
Deferred tax liabilities are generally recognised for all taxable temporary differences, and deferred tax
assets are generally recognised for all deductible temporary differences, unutilised allowances and
losses, to the extent that it is probable that future taxable profits will be available against which the
deferred tax assets can be utilised.
(g) Subsidiaries
Consolidation
The consolidated financial statements include the financial statements of the Company and its
subsidiaries (the “Group”) made up to 31 March.
Subsidiaries are entities (including structured entities) over which the Group has control. The Group
controls an entity when the Group is exposed to, or has right to, variable returns from its involvement
with the entity and has the ability to affect those returns through its power over the entity. The Group
reassesses whether or not it controls an investee if facts and circumstances indicate that there are
changes to one or more of the three elements of control listed above. Subsidiaries are consolidated
from the date on which control is transferred to the Group. They are de-consolidated from the date on
which control ceases.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
22
2 Significant Accounting Policies (cont’d)
(g) Subsidiaries (cont’d)
Consolidation (cont’d)
In preparing the consolidated financial statements, transactions, balances and unrealised gains on
transactions between group entities are eliminated. Unrealised losses are also eliminated unless the
transaction provides evidence of an impairment of the asset transferred. Where necessary, adjustments
are made to the subsidiaries financial statements to ensure consistency of accounting policies with that
of the Group.
Acquisition of business
The Group applies the acquisition method to account for business combinations when the acquired set
of activities and assets meets the definition of a business and control is transferred to the Group. In
determining whether an integrated set of activities and assets is a business, the Group assesses whether
the set of assets and activities acquired includes, at a minimum, an input and substantive process that
together significantly contribute to the ability to create output. A business can exist without including
all of the inputs and processes needed to create output. The Group has an option to apply a ‘fair value
concentration test’ that permits a simplified assessment of whether an acquired set of activities and
assets is not a business. The concentration test can be applied on a transaction-by-transaction basis.
The optional concentration test is met if substantially all of the fair value of the gross assets acquired
is concentrated in a single identifiable asset or group of similar identifiable assets. If the test is met,
the set of activities and assets is determined not to be a business and no further assessment is needed.
If the test is not met, or if the Group elects not to apply the test, a detailed assessment must be
performed applying the normal requirements in IFRS 3.
The consideration transferred for the acquisition of a subsidiary or business comprises the fair value
of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The
consideration transferred also includes the fair value of any contingent consideration arrangement and
the fair value of any pre-existing equity interest in the subsidiary.
Acquisition-related costs are expensed as incurred.
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination
are, with limited exceptions, measured initially at their fair values at the acquisition date.
On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the
acquiree at the date of acquisition either at fair value or at the non-controlling interest’s proportionate
share of the acquiree’s net identifiable assets.
The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree
and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value
of the net identifiable assets acquired is recorded as goodwill.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
23
2 Significant Accounting Policies (cont’d)
(g) Subsidiaries (cont’d)
Acquisition of business (cont’d)
If the total of consideration transferred, non-controlling interest and fair value of the previous equity
interest measured is less than the fair value of the net identifiable assets of the acquiree in the case of
a bargain purchase, the difference is recognised directly in profit or loss.
Disposals of subsidiaries or businesses
When a change in the Group’s ownership interest in a subsidiary results in a loss of control over the
subsidiary, the assets and liabilities of the subsidiary including any goodwill are derecognised.
Amounts recognised in other comprehensive income in respect of that entity are also reclassified to
profit or loss or transferred directly to retained earnings if required by a specific standard.
Any retained equity interest in the entity is remeasured at fair value. The difference between the
carrying amount of the retained interest at the date when control is lost and its fair value is recognised
in profit or loss.
Business combination involving entities under common control
Business combinations involving entities under common control are accounted for by applying the
pooling of interest method which involves the following:
The assets and liabilities of the combining entities are reflected at their carrying amounts
reported in the consolidated financial statements of the controlling holding company.
No adjustments are made to reflect the fair values on the date of combination or recognise
any new assets or liabilities.
No additional goodwill is recognised as a result of the combination.
Any difference between the consideration paid/transferred and the equity “acquired” is
reflected within the equity as other reserve.
The acquired entity’s results and balance sheet are incorporated prospectively from the date
on which the business combination between entities under common control occurred.
(h) Non-Controlling Interest
Non-controlling interest represents equity in subsidiaries not attributable, directly or indirectly, to
owners of the Group. These are presented separately in the consolidated statement of comprehensive
income and within equity in the consolidated balance sheet. Total comprehensive income is attributed
to the non-controlling interests based on their respective interests in a subsidiary, even if this results
in the non-controlling interests having a deficit balance.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
24
2 Significant Accounting Policies (cont’d)
(h) Non-Controlling Interest (cont’d)
Changes in the Group owners’ ownership interest in a subsidiary that do not result in a loss of control
are accounted for as equity transactions. In such circumstances, the carrying amounts of the
controlling and non-controlling interests are adjusted to reflect the changes in their relative interests
in the subsidiary. Any difference between the amount by which the non-controlling interest is adjusted
and the fair value of the consideration paid or received is recognised directly in equity and attributed
to owners of the Group.
(i) Inventories
Inventories comprising bunkers on board vessels are stated at lower of cost or net realisable value.
The cost is determined using the first-in, first-out basis. The net realisable value represents the
estimated selling price for inventories less all estimated costs of completion and costs necessary to
make the sale.
(j) Investments in Associates and Joint Ventures
Associates are entities over which the Group has significant influence, but not control, generally
accompanied by a shareholding giving rise to voting rights of 20% and above but not exceeding 50%.
Joint ventures are entities over which the Group has joint control as a result of contractual
arrangements, and rights to the net assets of the entities. Joint control is the contractually agreed
sharing of control of an arrangement, which exists only when decisions about the relevant activities
require unanimous consent of the parties sharing control.
Investments in associates and joint ventures are accounted for in the consolidated financial statements
using the equity method of accounting less impairment losses, if any.
Acquisitions
Investments in associates and joint ventures are initially recognised at cost. The cost of an acquisition
is measured at the fair value of the assets given, equity instruments issued or liabilities incurred or
assumed at the date of exchange, plus costs directly attributable to the acquisition. Goodwill on
associates and joint ventures represents the excess of the cost of acquisition of the associate or joint
venture over the Group’s share of the fair value of the identifiable net assets of the associate or joint
venture and is included in the carrying amount of the investments.
Negative goodwill (i.e. excess of the Group’s share of the net fair value of the associate or joint
venture’s identifiable assets and liabilities over the cost of the investment) is included as income as
part of the entity’s share of the associate or joint venture’s profit or loss in the period in which the
investment is acquired.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
25
2 Significant Accounting Policies (cont’d)
(j) Investments in Associates and Joint Ventures (cont’d)
Equity method of accounting
In applying the equity method of accounting, the Group’s share of its associates’ and joint ventures’
post acquisition profits or losses are recognised in profit or loss and its share of post-acquisition other
comprehensive income is recognised in other comprehensive income. These post-acquisition
movements and distributions received from the associates and joint ventures are adjusted against the
carrying amount of the investments.
When the Group’s share of losses in an associate company or joint venture equals to or exceeds its
interest in the associate company or joint venture, including any other unsecured non-current
receivables, the Group does not recognise further losses, unless the Group has incurred legal or
constructive obligations or made payments on behalf of the associate company or joint venture. If the
associate or joint venture subsequently reports profits, the Group resumes recognising its share of
those profits only after its share of the profits are equal to the share of losses not recognised.
Unrealised gains on transactions between the Group and its associates and joint ventures are
eliminated to the extent of the Group’s interest in the associates and joint ventures.
Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the
asset transferred. The accounting policies of associates and joint ventures have been changed where
necessary to ensure consistency with the accounting policies adopted by the Group.
Disposals
The Group discontinues the use of the equity method from the date when the investment ceases to be
an associate or a joint venture, or when the investment is classified as held for sale. When the Group
retains an interest in the former associate or joint venture and the retained interest is a financial asset,
the Group measures the retained interest at fair value at that date and the fair value is regarded as its
fair value on initial recognition. The difference between the carrying amount of the associate or joint
venture at the date the equity method was discontinued, and the fair value of any retained interest and
any proceeds from disposing of a part interest in the associate or joint venture is included in the
determination of the gain or loss on disposal of the associate or joint venture.
In addition, the Group accounts for all amounts previously recognised in other comprehensive income
in relation to that associate or joint venture on the same basis as would be required if that associate or
joint venture had directly disposed of the related assets or liabilities.
Therefore, if a gain or loss previously recognised in other comprehensive income by that associate or
joint venture would be reclassified to profit or loss on the disposal of the related assets or liabilities,
the Group reclassifies the gain or loss from equity to profit or loss (as a reclassification adjustment)
when the equity method is discontinued.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
26
2 Significant Accounting Policies (cont’d)
(j) Investments in Associates and Joint Ventures (cont’d)
Disposals (cont’d)
The Group continues to use the equity method when an investment in an associate becomes an
investment in a joint venture or an investment in a joint venture becomes an investment in an associate.
There is no remeasurement to fair value upon such changes in ownership interests.
When the Group reduces its ownership interest in an associate or a joint venture but the Group
continues to use the equity method, the Group reclassifies to profit or loss the proportion of the gain
or loss that had previously been recognised in other comprehensive income relating to that reduction
in ownership interest if that gain or loss would be reclassified to profit or loss on the disposal of the
related assets or liabilities.
(k) Joint Operations
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement
have rights to the assets, and obligations for the liabilities, relating to the arrangement. Joint control
is the contractually agreed sharing of control of an arrangement, which exists only when decision
about the relevant activities require unanimous consent of the parties sharing control.
When a group entity undertakes its activities under joint operations, the Group as a joint operator
recognises in relation to its interest in a joint operation:
its assets, including its share of any asset held jointly.
its liabilities, including its share of any liabilities incurred jointly.
its revenue from the sale of its share of the output arising from the joint operation.
its share of the revenue from the sale of the output by the joint operation.
its expenses, including its share of any expenses incurred jointly.
The Group accounts for the assets, liabilities, revenues and expenses relating to its interest in a joint
operation in accordance with the IFRSs applicable to the particular assets, liabilities, revenues and
expenses.
When a group entity transacts with a joint operation in which a group entity is a joint operator (such
as a sale or contribution of assets), the Group is considered to be conducting the transaction with the
other parties to the joint operation, and gains and losses resulting from the transactions are recognised
in the Group’s consolidated financial statements only to the extent of other parties’ interests in the
joint operation. When a group entity transacts with a joint operation in which a group entity is a joint
operator (such as purchase of assets), the Group does not recognise its share of the gains and losses
until it resells those assets to a third party.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
27
2 Significant Accounting Policies (cont’d)
(l) Vessels
Vessels are stated at cost less accumulated depreciation and accumulated impairment losses if any.
The cost includes the acquisition cost, pre-delivery costs and any directly attributable costs of bringing
the vessels to the location and condition necessary for it to be capable of operating in the manner
intended by management.
Subsequent expenditures are added to the carrying amount of the vessel only when it is probable that
future economic benefits associated with the costs will flow to the Group and the cost can be measured
reliably. All other routine repair and maintenance expenses are recognised in profit or loss when
incurred.
Vessels under construction are stated at cost, less any recognised impairment loss in accordance with
the installment payments agreed upon.
On disposal of a vessel, the difference between the disposal proceeds and its carrying amount is
recognised in profit or loss.
Depreciation is provided on a straight-line basis on carrying amounts less residual values, over the
estimated useful life of 25 years, in accordance with common industry practice.
Residual values are based on lightweight tonnage and the market price for scrap steel paid on
demolition of tankers as at the balance sheet date. The residual values and useful lives are reviewed
and adjusted as appropriate, at each balance sheet date.
(m) Drydocking and Special Survey Costs
Drydocking and special survey costs are capitalised and depreciated on a straight-line basis over the
estimated period (generally between 3 to 5 years) to the next drydocking.
(n) Other Fixed Assets (including Right-of-use assets)
Other fixed assets are stated at cost less accumulated depreciation and accumulated impairment losses
if any.
The cost of the assets comprises its purchase price and any directly attributable costs of bringing the
asset to the location and condition necessary for it to be capable of operating in the manner intended
by management.
Subsequent expenditures are added to the carrying amount of the asset only when it is probable that
future economic benefits associated with the expenditure will flow to the Group and the cost can be
measured reliably. All other repair and maintenance expenses are recognised in profit or loss when
incurred.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
28
2 Significant Accounting Policies (cont’d)
(n) Other Fixed Assets (including Right-of-use assets) (cont’d)
On disposal of other fixed assets, the difference between the disposal proceeds and its carrying amount
is recognised in profit or loss.
Other fixed assets are depreciated over the following periods on a straight-line basis less any
recognised impairment loss:
Useful lives
Office equipment 5 years
Furniture and fittings 3-5 years
Computer equipment 3 years
Motor vehicles 5 years
Office premises 2-10 years
Time-chartered vessels 2-5 years
The residual values, estimated useful lives and depreciation method of other fixed assets are reviewed
and adjusted as appropriate, at each balance sheet date. The effects of any revision are recognised in
profit or loss when the changes arise.
(o) Impairment of Non-Financial Assets, excluding Goodwill
At each balance sheet date, the Group reviews the carrying amount of its tangible assets to determine
whether there is any objective evidence or indication that these assets have suffered an impairment
loss. If any such indication exists, the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any).
For the purpose of impairment testing, the recoverable amount is the higher of fair value less costs of
disposal and value in use and is determined on an individual asset basis unless the asset does not
generate cash flows that are largely independent of those from other assets. If this is the case, the
recoverable amount is determined for the cash-generating unit (“CGU”) to which the asset belongs. If
the recoverable amount of an asset (or CGU) is estimated to be less than its carrying value, the carrying
amount of the asset (or CGU) is reduced to its recoverable amount. An impairment loss is recognised
immediately in profit or loss.
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the
revised estimate of its recoverable amount, so that the increased carrying amount does not exceed the
carrying amount that would have been determined had no impairment loss been recognised for the
asset in prior years. A reversal of an impairment loss is recognised immediately in profit or loss.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
29
2 Significant Accounting Policies (cont’d)
(p) Financial Assets
Classification and Measurement
The Group classifies its financial assets in the following measurement categories:
Amortised costs;
Fair value through other comprehensive income; and
Fair value through profit or loss.
The classification depends on the Group’s business model for managing the financial assets as well
as the contractual terms of the cash flows of the financial assets. The Group reclassifies debt
instruments when and only when its business model for managing those assets changes.
Financial assets with embedded derivatives are considered in their entirety when determining whether
their cash flows are solely related to payment of principal and interest.
Initial Recognition
At initial recognition, the Group measures a financial asset at its fair value plus, in the case of a
financial asset not at fair value through profit or loss, transactions costs that are directly attributable
to the acquisition of the financial asset. Transaction costs of financial assets carried at fair value
through profit or loss are expensed in profit or loss.
Trade receivables are measured at the amount of consideration to which the Group expected to be
entitled in exchange for transferring promised goods or services to a customer excluding amounts
collected on behalf of a third party, if the trade receivables do not contain a significant financing
component at initial recognition.
Subsequent Measurement
i. Debt instruments
The subsequent measurement categorisation depends on the Group’s business model for managing the
asset and the cash flow characteristics of the asset.
For debt instruments measured at amortised cost, these are held for collection of contractual cash flows
where those cash flows represent solely payments of principal and interest are measured at amortised
cost. A gain or loss on a debt instrument that is subsequently measured at amortised cost and is not
part of a hedging relationship is recognised in profit or loss when the asset is derecognised or impaired.
Interest income from these financial assets is included in finance income using the effective interest
rate method.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
30
2 Significant Accounting Policies (cont’d)
(p) Financial Assets (cont’d)
Classification and Measurement (cont’d)
Subsequent Measurement (cont’d)
For debt instruments measured at fair value through profit or loss, the movement in fair values and
interest income that is not part of a hedging relationship is recognised in profit or loss in the period in
which it arises.
ii. Equity instruments
The Group subsequently measures all its equity investments at their fair values. Equity instruments
are classified as fair value through profit or loss with movements in their fair values recognised in
profit or loss, except where the Group has elected to classify the investments at fair value through
other comprehensive income. Dividends from equity investments are recognised in profit or loss. On
disposals, the cumulative gain or loss of the investments classified as fair value through other
comprehensive income will be transferred directly to retained earnings.
Impairment
The Group assesses on a forward looking basis the expected credit losses associated with the financial
assets measured at amortised costs and intra-group financial guarantee contracts.
Loss allowances of the Group are measured on either of the following bases:
12-month expected credit loss – represents the expected credit loss that result from default events
that are possible within the 12 months after the reporting date (or for a shorter period if the
expected life of the instrument is less than 12 months); or
Lifetime expected credit loss – represents the expected credit loss that will result from all possible
default events over the expected life of a financial instrument or contract asset.
The impairment methodology applied depends on whether there has been a significant increase in
credit risk.
Simplified approach - Trade receivables
The Group applies the simplified approach to provide expected credit losses for all trade receivables
as permitted by IFRS 9. The simplified approach requires expected lifetime losses to be recognised
from initial recognition of the receivables. The expected credit losses on these financial assets are
estimated using a provision matrix based on the Group’s historical credit loss experience, adjusted for
factors that are specific to the debtors, general economic conditions and an assessment of both the
current as well as the forecast direction of conditions at the reporting date, including time value of
money where appropriate.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
31
2 Significant Accounting Policies (cont’d)
(p) Financial Assets (cont’d)
Impairment (cont’d)
General approach - Other financial instruments and financial guarantee contracts
The Group applies the general approach to provide for expected credit losses on all other financial
instruments and financial guarantee contracts, which requires the loss allowance to be measured at an
amount equal to 12-month expected credit losses at initial recognition.
At each reporting date, the Group assesses whether the credit risk of a financial instrument has
increased significantly since initial recognition. When credit risk has increased significantly since
initial recognition, loss allowance is measured at an amount equal to lifetime expected credit losses.
In assessing whether the credit risk of a financial asset has increased significantly since initial
recognition and when estimating expected credit losses, the Group considers reasonable and
supportable information that is relevant and available without undue cost or effort. This includes both
quantitative and qualitative information that is reasonable and supportable, including the Group’s
historical experience and forward-looking information that is available without undue cost or effort.
If credit risk has not increased significantly since initial recognition or if the credit quality of the
financial instruments improves such that there is no longer a significant increase in credit risk since
initial recognition, loss allowance is measured at an amount equal to 12-month expected credit losses.
The maximum period considered when estimating expected credit losses is the maximum contractual
period over which the Group is exposed to credit risk.
Credit-impaired financial assets
A financial asset is credit-impaired when one or more events that have a detrimental impact on the
estimated future cash flows of the financial asset have occurred. At each reporting date, the Group
assesses whether financial assets carried at amortised cost are credit-impaired. The evidence includes
the observable data about the significant financial difficulty of the borrower and default or past due
event.
Measurement of expected credit losses
Expected credit losses are probability-weighted estimates of credit losses. Credit losses are measured
at the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity
in accordance with the contract and the cash flows that the Group expects to receive). Expected credit
losses are discounted at the effective interest rate of the financial asset.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
32
2 Significant Accounting Policies (cont’d)
(p) Financial Assets (cont’d)
Impairment (cont’d)
Write-off policy
The Group writes off a financial asset when there is information indicating that the counterparty is in
severe financial difficulty and there is no realistic prospect of recovery. Any recoveries made are
recognised in profit or loss.
Recognition and Derecognition
Regular way purchases and sales of financial assets are recognised on the trade date – the date on
which the Group commits to purchase or sell the asset.
Financial assets are derecognised when the rights to receive cash flows from the financial assets have
expired or have been transferred and the Group has transferred substantially all risks and rewards of
ownership. On disposal of a financial asset measured at amortised cost, the difference between the net
sale proceeds and its carrying amount is recognised in profit or loss. On disposal of an equity
investment, the difference between the carrying amount and sales proceeds is recognised in profit or
loss if there was no election made to recognise fair value changes in other comprehensive income. If
there was an election made, any difference between the carrying amount and sales proceed amount
would be recognised in other comprehensive income and transferred to retained profits along with the
amount previously recognised in other comprehensive income relating to that asset.
(q) Cash and Bank Balances
Cash and bank balances comprise cash on hand, short-term bank deposits and other short-term highly
liquid investments that are readily convertible to a known amount of cash and are subject to an
insignificant risk of changes in value. For the purpose of the consolidated statement of cash flows,
cash and bank balances are shown net of restricted bank deposits.
(r) Share Capital
Ordinary shares are classified as equity. Incremental costs directly attributable to the issuance of new
shares are deducted against the share capital account.
Preference shares are classified as equity as they are non-redeemable or redeemable only at the
Company’s option and any dividends are discretionary.
The Company’s own ordinary and preference shares, which were re-acquired by the Company were
cancelled and the amount equivalent to their nominal value was shown as a movement in share capital.
The premium paid on the shares repurchased and cancelled was charged against retained earnings. No
gain or loss is recognised in profit or loss on the cancellation of shares.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
33
2 Significant Accounting Policies (cont’d)
(s) Leases
When the Group is the lessee
At the inception of the contract, the Group assesses if the contract contains a lease. A contract contains
a lease if the contract conveys the right to control the use of an identified asset for a period of time in
exchange for consideration. Reassessment is only required when the terms and conditions of the
contract are changed.
The Group recognises right-of-use assets and lease liabilities at the date which the underlying assets
become available for use. Right-of-use assets are measured at cost, less any accumulated depreciation
and impairment losses and adjusted for re-measurement of lease liabilities. The cost of Right-of-use
assets includes the initial measurement of lease liabilities adjusted for any lease payment made at or
before the commencement dates, plus any initial direct costs incurred less any lease incentives
received. Any initial cost that would not have been incurred if the lease had not been obtained are
added to the carrying amount of the right-of-use assets. Right-of-use asset is depreciated using the
straight-line basis over the shorter of the lease term and the estimated useful lives of the assets.
The Group has elected not to recognise right-of-use assets and lease liabilities for short-term leases that
have lease term of 12 months or less and leases of low value assets. Lease payment relating to these
leases are expensed to the income statement on a straight-line basis over the lease term.
The initial measurement of lease liabilities is measured at the present value of the lease payments
discounted using the implicit rate in the lease, if the rate can be readily determined. If that rate cannot
be readily determined, the Group uses its incremental borrowing rate. Lease payments included in the
measurement of the lease liability comprise the following:
- fixed payments (including in-substance fixed payments), less any lease incentives receivables;
- variable lease payments that are based on an index or a rate, initially measured using the index or
rate as at the commencement date;
- amounts expected to be payable under residual value guarantees;
- the exercise price of a purchase option if it is reasonably certain to exercise the option; and
- payment of penalties for terminating the lease, if the lease term reflects the Group exercising that
option.
For contracts that contain both lease and non-lease components, the Group allocates the consideration
to each lease component on the basis of the relative stand-alone price of the lease and non-lease
components.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
34
2 Significant Accounting Policies (cont’d)
(s) Leases (cont’d)
When the Group is the lessee (cont’d)
Lease liabilities are measured at amortised cost, and are re-measured when:
- there is a change in future lease payments arising from changes in an index or rate;
- there is a change in the Group’s assessment of whether it will exercise lease extension and
termination options;
- there is a change in the Group’s estimate of the amount expected to be payable under a residual
value guarantee; or
- there is a modification to the lease term.
When lease liabilities are re-measured, corresponding adjustments are made against the right-of-use
assets. If the carrying amounts of the right-of-use assets have been reduced to zero, the adjustments
are recorded in profit or loss.
Variable lease payments that are based on an index or a rate are include in the measurement of the
corresponding right-of-use assets and lease liabilities. Other variable lease payments are recognised
in profit or loss when incurred.
● When the Group is the lessor
Leases where the Group retains a significant portion of the risks and rewards incidental to ownership
are classified as operating leases. Income from operating leases (net of any incentives given to the
lessees) is recognised in profit or loss on a straight-line basis over the lease term. Contingent rents are
recognised as income in the profit or loss when earned.
(t) Financial Liabilities
Classification
The Group classifies its financial liabilities either as financial liabilities at fair value through profit or
loss or as other financial liabilities (for Trade and Other Payables, Bank Loans, Short-term and Other
Borrowings and Finance Lease Obligations). The classification depends on the substance of the
contractual arrangements entered into and the definition of a financial liability. Financial liabilities
are recognised initially at fair value plus, in the case of a financial liability not at fair value through
profit and loss, transaction costs that are directly attributable to the acquisition.
Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss are initially measured at fair value and
subsequently stated at fair value, with any gains or losses arising on re-measurement recognised in
profit or loss. The net gain or loss recognised in profit or loss incorporates any interest paid on the
financial liability. Fair value is determined in the manner prescribed in Note 32 to the consolidated
financial statement.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
35
2 Significant Accounting Policies (cont’d)
(t) Financial Liabilities (cont’d)
Financial liabilities at fair value through profit or loss (cont’d)
A financial liability other than a financial liability held for trading may be designated as at fair value
through profit or loss upon initial recognition if:
i. such designation eliminates or significantly reduces a measurement or recognition inconsistency
that would otherwise arise; or
ii. the financial liability forms part of a group of financial assets or financial liabilities or both, which
is managed and its performance is evaluated on a fair value basis, in accordance with the group’s
documented risk management or investment strategy, and information about the grouping is
provided internally on that basis; or
iii. it forms part of a contract containing one or more embedded derivatives, and IFRS 9 permits the
hybrid contract (asset or liability) to be designated as at fair value through profit or loss.
Other financial liabilities
Trade and other payables
Trade and other payables are initially measured at fair value, and are subsequently carried at
amortised cost, using the effective interest rate method.
Bank loans
Bank loans are recognised initially at fair value, net of transaction costs incurred. Bank loans are
subsequently stated at amortised cost. Any difference between the proceeds (net of transaction
costs) and the redemption value is taken to profit or loss over the tenure of the loans using the
effective interest method.
Short-term and other borrowings
Short-term and other borrowings are recognised initially at fair value, net of transaction costs
incurred, and are subsequently stated at amortised cost.
(u) Government Grants
Grants from the government are recognised as a receivable at their fair value when there is reasonable
assurance that the grant will be received and the Group will comply with all the attached conditions.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
36
2 Significant Accounting Policies (cont’d)
(u) Government Grants (cont’d)
Government grants receivable are recognised as income over the periods necessary to match them
with the related costs which they are intended to compensate, on a systematic basis.
Government grants relating to assets are deducted against the carrying amount of the assets.
Government grants relating to expenses are set off against relevant expenses.
(v) Borrowing Costs
Borrowing costs attributable to the acquisition, construction or production of qualifying assets, which
are assets that necessarily take a substantial period of time to get ready for their intended use or sale,
are added to the cost of those assets, until such time as the assets are substantially ready for their
intended use or sale. Borrowing costs consist of interest and other costs that an entity incurs in
connection with the borrowing of funds.
Investment income earned on the temporary investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation.
All other borrowing costs are recognised in profit or loss in the period in which they are incurred.
(w) Provisions
Provisions are recognised when the Group has a present constructive obligation as a result of past
events. It is more likely than not that an outflow of resources will be required to settle the obligation
and the amount has been reliably estimated. Provisions are not recognised for future operating losses.
(x) Dividends
Dividends are recognised as a liability when declared by the Company’s board of directors.
(y) Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the key
management whose members are responsible for allocating resources and assessing performance of
the operating segments.
(z) Derivatives Financial Instruments and Hedging Activities
A derivative financial instrument is initially recognised at its fair value on the date the contract is
entered into and is subsequently carried at its fair value. The method of recognising the resulting gain
or loss depends on whether the derivative is designated as a hedging instrument, and if so, the nature
of the item being hedged.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
37
2 Significant Accounting Policies (cont’d)
(z) Derivatives Financial Instruments and Hedging Activities (cont’d)
Fair value changes on derivatives that are not designated or do not qualify for hedge accounting are
recognised in profit or loss when the changes arise.
The Group has entered into currency forwards that qualify as cash flow hedges against highly probable
forecasted transactions in foreign currencies. The fair value changes on the effective portion of the
currency forwards designated as cash flow hedges are recognised in other comprehensive income.
Amounts accumulated in equity are reclassified in the periods when the hedged item affects profit or
loss. The fair value changes on the ineffective portion of currency forwards are recognised
immediately in profit or loss. When a forecasted transaction is no longer expected to occur, the gains
and losses that were previously recognised in other comprehensive income are reclassified to profit or
loss immediately.
(aa) Fair Value Estimation of Financial Assets and Liabilities
The fair values of financial instruments traded in active markets (such as exchange-traded and over-
the-counter securities and derivatives) are based on quoted market prices at the balance sheet date.
The quoted market prices used for financial assets are the current bid prices; the appropriate quoted
market prices used for financial liabilities are the current asking prices.
The fair values of financial instruments that are not traded in an active market are determined by using
valuation techniques. The Group uses a variety of methods and makes assumptions based on market
conditions that are existing at each balance sheet date. Where appropriate, quoted market prices or
dealer quotes for similar instruments are used. Valuation techniques, such as discounted cash flow
analysis, are also used to determine the fair values of the financial instruments.
The carrying amounts of current financial assets and liabilities carried at amortised cost approximate
their fair values.
(bb) Related Parties
A related party is defined as follows:
A related party is a person or entity that is related to the entity that is preparing its financial statements
(referred to as the ‘reporting entity’).
a. A person or a close member of that person’s family is related to a reporting entity if that
person:
i. has control or joint control over the reporting entity;
ii. has significant influence over the reporting entity; or
iii. is a member of the key management personnel of the reporting entity or of a parent
of the reporting entity.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
38
2 Significant Accounting Policies (cont’d)
(bb) Related Parties (cont’d)
b. An entity is related to a reporting entity if any of the following conditions applies:
i. the entity and the reporting entity are members of the same group (which means that
each parent, subsidiary and fellow subsidiary is related to the others);
ii. one entity is an associate or joint venture of the other entity (or an associate or joint
venture of a member of a group of which the other entity is a member);
iii. both entities are joint venture of the same third party;
iv. one entity is a joint venture of a third entity and the other entity is an associate of the
third entity;
v. the entity is a post-employment benefit plan for the benefit of employees of either the
reporting entity or an entity related to the reporting entity. If the reporting entity is
itself such a plan, the sponsoring employers are also related to the reporting entity;
vi. the entity is controlled or jointly controlled by a person identified in (a);
vii. a person identified in (a) (i) has significant influence over the entity or is a member
of the key management personnel of the entity (or of a parent of the entity); or
viii. the entity, or any member of a group of which it is a part, provides key management
personnel services to the reporting entity or to the parent of the reporting entity.
3 Critical Accounting Estimates, Assumptions and Judgments
Estimates, assumptions and judgments are made in the preparation of the consolidated financial
statements. They affect the application of the Group’s accounting policies, reported amounts of assets
and liabilities, income and expenses, and disclosures made.
Management has taken into consideration the impact of Covid-19 pandemic and whether there are any
indications that these assets may be impacted adversely. If any such indication existed, an estimate
was made of the realisable amount and/or fair value of the relevant assets. These are assessed on an
on-going basis and are based on experience and relevant factors, including expectation of future events
that are believed to be reasonable under the circumstances.
(a) Key Sources of Estimation Uncertainty
The key assumptions concerning the future and other key sources of estimation uncertainty at the
balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts
of assets and liabilities within the next financial year are discussed below.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
39
3 Critical Accounting Estimates, Assumptions and Judgments (cont’d)
(a) Key Sources of Estimation Uncertainty (cont’d)
(i) Impairment of non-financial assets
The Group assesses impairment of non-financial assets whenever events or changes in circumstances
indicate that the carrying amount of an asset may not be recoverable. If such indication exists, the
recoverable amount (i.e. higher of the fair value less costs of disposal and value in use) of the asset is
estimated to determine the impairment loss. In making this judgment, the Group evaluates the value
in use which is supported by the net present value of future cash flows derived from such assets using
cash flow projections which have been discounted at an appropriate rate. In determining the fair value
less costs of disposal, the Group has obtained valuation reports from third party sources. The valuation
of the vessels was prepared assuming a sale between a willing seller and a willing buyer on a charter-
free basis.
The carrying amount of the Group’s vessels and right-of-use assets as at 31 March 2022 amounted to
US$608.0 million and US$58.8 million (2021: US$698.2 million and US$86.6 million) respectively.
No impairment loss has been recognised for the financial years ended 31 March 2022 and 2021.
Further details are given in Notes 13 and 18 to the consolidated financial statements.
For the value in use calculations, if the estimated revenue from future cash flows for the Group’s
vessels are reduced by 10% compared to management’s estimates, there would be no impact on the
Group’s results for the financial year ended 31 March 2022 (2021: impairment charge of US$0.5
million).
The carrying amount of the Group’s interest in associates and joint ventures as at 31 March 2022
amounted to US$27.6 million and US$1.6 million (2021: US$36.2 million and US$1.0 million)
respectively. No impairment loss has been recognised for the financial years ended 31 March 2022
and 2021. Further details are given in Notes 16 and 17 to the consolidated financial statements.
(ii) Useful lives of vessels and other fixed assets and right-of-use assets and residual value of
vessels
The Group determines the estimated useful lives and related depreciation charges for its vessels, other
fixed assets and right-of-use assets. This estimate is based on the historical experience of the actual
useful lives of these vessels and other fixed assets of a similar nature and function. Changes in the
remaining useful lives of the vessels and other fixed assets and residual value, determined based on
year end scrap rates, technical innovations and competitor actions, would result in an adjustment to
the current and future rate of depreciation through profit or loss. Management will increase the
depreciation charge where useful lives are less than previously estimated. Management will write-off
or write-down technically obsolete assets.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
40
3 Critical Accounting Estimates, Assumptions and Judgments (cont’d)
(a) Key Sources of Estimation Uncertainty (cont’d)
(ii) Useful lives of vessels and other fixed assets and right-of-use assets and residual value of
vessels (cont’d)
The carrying amounts of the Group’s vessels, other fixed assets and right-of-use assets as at 31 March
2022 was US$667.8 million (2021: US$786.4 million). Further details are given in Notes 13, 14 and
18 to the consolidated financial statements.
If depreciation on the vessels, other fixed assets and right-of-use assets is increased by 10% from
management’s estimates, the Group’s results for the financial year ended 31 March 2022 will decrease
by US$6.7 million (2021: US$9.2 million).
(b) Critical Judgments in applying Accounting Policies
In the process of applying the Group’s accounting policies, the application of judgments that are
expected to have a significant effect on the amounts recognised in the consolidated financial
statements are discussed below.
(i) Loss allowance for receivables (including accrued receivables)
The Group measures the loss allowance for receivables in accordance with the accounting policy as
disclosed in Note 2(p). In making this estimation and judgement, the Group evaluates, among other
factors, the ageing analysis of receivables, the financial healthiness and collection history of individual
debtors and expected future change of credit risks, including the consideration of factors such as
general economy measure, changes in macro-economic indicators, etc.
The carrying amount of the Group’s total trade and other receivables and accrued receivables as at 31
March 2022 amounted to US$438.0 million and US$125.3 million (2021: US$319.6 million and
US$63.2 million) respectively. The information about the expected credit losses on the Group’s trade
and other receivables and accrued receivables is disclosed in Notes 20 and 32 to the consolidated
financial statements.
During the financial year ended 31 March 2022, the Group provided an impairment loss on trade
receivables of US$4.2 million (2021: US$4.6 million) and write back of impairment loss of US$2.8
million (2021: US$4.9 million).
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
41
3 Critical Accounting Estimates, Assumptions and Judgments (cont’d)
(b) Critical Judgments in applying Accounting Policies (cont’d)
(ii) Leases
In making an evaluation, judgment is used in determining lease classification in accordance with Note
2(s) to the consolidated financial statements.
At the reporting date, the Group entered into contracts with third parties for the sale of vessels under
construction and vessels. The Group further entered into bareboat charter agreements for these vessels.
Management has assessed that the agreements entered into between the Group and third parties do not
qualify for sale-leaseback accounting, either as a result of a purchase obligation or as a result of a
purchase option which constitutes a form of continuing involvement by the Group in the vessel. In the
case of the purchase options, the Group has applied its judgment and determined that the exercise of
purchase options is “almost certain” and treated the lease as a financing arrangement. Further details
are set out in Notes 13 and 26 to the consolidated financial statements.
(iii) Contingencies
The Group is involved from time to time in the course of its business, in disputes resulting from its
operating activities, which may or may not result in legal action being taken by or against the Group.
Based on consultations with its legal counsel, management considers the likely outcome of the
disputes in which it is currently involved and has concluded it will not have a material impact on the
consolidated financial statements.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
42
4 Organisation and Trading Activities
The Group’s operations were carried out during the financial year through main offices in Singapore,
the United Kingdom, United States of America, India, China, United Arab Emirates (“UAE”), Greece,
Germany, Norway and Japan.
The principal subsidiaries are as follows:
Country of
i
ncorporation
Percentage
of Holding
2022
2021
%
%
(i)
Investment holding
Apollo Shipping Inc
Marshall Islands
100
100
(e)
Crew Management Pte Ltd
Singapore
100
100
(b)
Navig8 Asset Co Investments Inc
Marshall Islands
100
100
(e)
Navig8 Asset Holdings Inc
Marshall Islands
100
100
(e)
Navig8 Asset Management Holdings Inc
Marshall Islands
100
100
(e)
Navig8 Group Holdings Inc
Marshall Islands
100
100
(e)
Navig8 Pool Holdings Inc
Marshall Islands
100
100
(e)
Navig8 Commercial Services Ltd
Marshall Islands
100
100
(e)
Navig8 Technical
Management Holdings
Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation Ltd
Marshall Islands
100
100
(e)
Integr8 Fuels Holding Inc
Marshall Islands
83.1
83.6
(e), (
g
)
Navig8 Chemicals Services Ltd
Marshall Islands
100
100
(e)
Technical Investments Inc
Marshall Islands
100
100
(e)
TBM Holdings Inc
Marshall Islands
100
100
(e)
Marine Technologies Inc (previously known
as Marine
Software Developments Inc
)
Marshall Islands
100
100
(e)
Navig8 Agency Holdings Inc Marshall Islands 100 -
(e)
(ii)
Ship chartering
Navig8 Inc
Marshall Islands
100
100
(e)
Navig8 Pte Ltd
Singapore
100
100
(b)
Navig8 Bulk Pool Inc
Marshall Islands
100
100
(a), (f)
Navig8 Chemicals Pool Inc
Marshall Islands
100
100
(a), (f)
Navig8 Pool Inc
Marshall Islands
100
100
(a), (f)
V8 Pool Inc
Marshall Islands
100
100
(a), (f)
VL8 Pool Inc
Marshall Islands
100
100
(a), (f)
Pythagoras Corporation 9 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 10 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 11 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 12 Inc
Marshall Islands
100
100
(e)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
43
4 Organisation and Trading Activities (cont’d)
(A) Subsidiaries (cont’d)
The principal subsidiaries are as follows: (cont’d)
Country of
incorporation
Percentage
of Holding
2022
2021
%
%
(iii)
Ship owning
Apollo Shipping 1 Inc Corporation
Marshall Islands
100
100
(e)
Apollo Shipping 2 Inc Corporation
Marshall Islands
100
100
(e)
Apollo Shipping 3 Inc Corporation
Marshall Islands
100
100
(e)
Apollo Shipping 4 Inc Corporation
Marshall Islands
100
100
(e)
Apollo Shipping 5 Inc Corporation
Marshall Islands
100
100
(e)
Apollo Shipping 6 Inc Corporation
Marshall Islands
100
100
(e)
Apollo Shipping 7 Inc Corporation
Marshall Islands
100
100
(e)
Apollo Shipping 8 Inc Corporation
Marshall Islands
100
100
(e)
Straits Shipping 2 Corporation
Marshall Islands
100
100
(e)
Navig8 Constellation Corporation
Marshall Islands
100
100
(e)
Navig8 Universe Corporation
Marshall Islands
100
100
(e)
Pythagoras Corporation 1 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 2 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 3 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 4 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 5 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 6 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 7 Inc
Marshall Islands
100
100
(e)
Pythagoras Corporation 8 Inc
Marshall Islands
100
100
(e)
Herakleitos 3050 LLC
Marshall Islands
100
100
(e)
D8 Product Tankers I LLC
Marshall Islands
100
-
(d), (e)
(iv) Brokerage and Commercial Management
Navig8 America LLC
USA
100
100
(b)
Navig8 Asia Pte Ltd
Singapore
100
100
(b)
Navig8 DMCC
Dubai
100
100
(c)
Navig8 Europe Ltd
United Kingdom
100
100
(c)
Navig8 Greece Inc
Marshall Islands
100
100
(b)
Navig8 India Private Limited
India
100
100
(c)
VL8 Management Inc
Marshall Islands
100
100
(e)
Navig8 Bulk Asia Pte
Ltd
Singapore
-
100
(b)
, (h)
Navig8 Bulk Europe Ltd
United Kingdom
-
100
(c)
, (h)
Navig8 Chemicals America LLC
USA
100
100
(e)
Navig8 Chemicals Asia Pte Ltd
Singapore
100
100
(b)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
44
4 Organisation and Trading Activities (cont’d)
(A) Subsidiaries (cont’d)
The principal subsidiaries are as follows: (cont’d)
Country of
incorporation
Percentage
of Holding
2022
2021
%
%
(iv) Brokerage and Commercial Management
Navig8 Chemicals DMCC
Dubai
100
100
(c)
Navig8 Chemicals Europe Ltd
United Kingdom
100
100
(c)
(v)
Risk management
Navig8 Risk Management Pte. Ltd.
Singapore
100
100
(b)
Integr8 Risk Management Pte. Ltd.
Singapore
83.1
83.6
(b), (g)
(vi)
Bunker trading
Integr8 Fuels Inc
Marshall Islands
83.1
83.6
(e), (
g
)
Integr8 Cargo Trading Inc
Marshall Islands
83.1
83.6
(e), (g)
Integrate Fuels LLC
Dubai
83.1
83.6
(e), (
g
)
Integr8 Fuels Pte. Ltd.
Singapore
83.1
83.6
(b), (g)
Engine
Technologies Pte Ltd
Singapore
100
100
(b)
(vii)
Bunker brokerage
Integr8 Fuels America LLC
USA
83.1
83.6
(e), (
g
)
Integr8 Fuels Asia Pte Ltd
Singapore
83.1
83.6
(b), (
g
)
Integr8 Fuels DMCC
Dubai
83.1
83.6
(c), (
g
)
Integr8 Fuels Europe Ltd
United Kingdom
83.1
83.6
(e), (
g
)
Integr8 Fuels Germany GmbH
Germany
83.1
83.6
(e), (
g
)
Integr8 Fuels Greece S.A.
Greece
83.1
83.6
(e), (
g
)
Integr8 Fuels India Private Limited
India
83.1
83.6
(c), (
g
)
Integr8 Fuels
Japan KK
Japan
83.1
83.6
(c), (
g
)
Integr8 Fuels Oslo AS
Norway
83.1
83.6
(e), (
g
)
Integr8 Turkey Akaryakit Tic.Ltd.
Turkey
83.1
83.6
(e), (
g
)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
45
4 Organisation and Trading Activities (cont’d)
(A) Subsidiaries (cont’d)
The principal subsidiaries are as follows: (cont’d)
(a) The activities of the Pool companies are regarded as jointly-controlled operations. The assets
and liabilities attributable to the Group’s vessels operating in the jointly-controlled operations
are consolidated in the Group’s financial statements.
(b) Audited by Moore Stephens LLP, Singapore.
(c) Audited by a member firm of Moore Global Network Limited of which Moore Stephens LLP,
Singapore is a member.
(d) During the current financial year, the Group, through one of its subsidiaries, acquired the
remaining interest in this company and this company is now wholly-owned by the Group and
the financial year end has been changed to 31 March.
(e) Subsidiary companies which are not required to be audited by the law in their country of
incorporation. However, the financial statements were audited in accordance with IFRS for
consolidation purposes by Moore Stephens LLP, Singapore
(f) Audited by PricewaterhouseCoopers, Singapore.
(g) During the current financial year, the Group’s share of interest was diluted from 83.6% to
83.1%.
(h) These companies were liquidated during the current financial year.
Adjustment of interest in subsidiaries
During the current financial year, the Group’s interest was diluted by the sale of shares in the Integr8
Group. The Group’s effective interest in Integr8 Group was accordingly reduced from 83.6% to 83.1%
(2021: 84.8% to 83.6%). This did not result in a loss of control, and accordingly, the decrease of the
interest in the subsidiaries has been accounted for as an equity transaction.
2022
2021
US$’000
US$’000
Proceeds from sale of interest in
subsidiaries
3
7
7
750
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
46
4 Organisation and Trading Activities (cont’d)
(A) Subsidiaries (cont’d)
Step acquisition of additional interest in a former associate
During the current financial year, the Group acquired the remaining 50% of the issued shares of D8
Product Tankers I LLC, a former associate. As at the reporting date, the Group holds 100% of the
issued shares of D8 Product Tankers I LLC. Details of the consideration received, the assets acquired
and liabilities assumed, and the effects on the cash flows of the Group, at the acquisition date, are as
follows:
(a) Purchase consideration
2022
US$’000
Cash received as consideration 2,500
(b) Identifiable assets acquired and liabilities assumed
At fair value
US$’000
100% interest
Cash and cash equivalents 219
Vessel 10,000
Trade and other receivables
2,490
Total assets 12,709
Less:
Trade and other payables (3,908)
Borrowings (9,891)
Total liabilities (13,799)
Total identifiable net liabilities
(1,090)
Less:
Net gain on step acquisition of a former associate to a subsidiary (190)
Derecognition of existing cost of investment in associate
(
1
,
220
)
Consideration received for the acquisition of additional 50% interest (2,500)
Less: Cash and cash equivalents acquired (219)
Net cash inflow from step acquisition of a former associate to a subsidiary (2,719)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
47
4 Organisation and Trading Activities (cont’d)
(A) Subsidiaries (cont’d)
Acquisition of additional interest in a group of subsidiaries
During the previous financial year ended 31 March 2021, the Group acquired the remaining 35% of
the issued shares of Navig8 Chemical Services Ltd and its subsidiaries (“Chemical Group”) for a
purchase consideration of US$12.8 million. The Group holds 100% of the equity share capital of the
Chemical Group upon acquisition. The Group derecognised non-controlling interests of US$2.5
million and recorded a decrease in equity attributable to owners of the parent of US$10.3 million. The
effect of changes in the ownership interest of the Chemical Group on the equity attributable to owners
of the Group at the acquisition date is summarised as follows:
2021
US$’000
Carrying amount of non
-
controlling interest acquired
2,479
Consideration paid to non
-
controlling interest
(12,771)
Excess of consideration paid recognised in parent’s equity
(10,292)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
48
4 Organisation and Trading Activities (cont’d)
(B) Jointly-controlled Operations
The principal jointly-controlled operations are as follows:
Name of Pool
Principal
Activities
Country of
incorporation
MR Pool Commercial employment and operation of Pool vessels Marshall Islands
Gamma Pool Commercial employment and operation of Pool vessels Marshall Islands
LR8 Pool Commercial employment and operation of Pool vessels Marshall Islands
Alpha8 Pool Commercial employment and operation of Pool vessels Marshall Islands
V8 Pool Commercial employment and operation of Pool vessels Marshall Islands
Suez8 Pool Commercial employment and operation of Pool vessels Marshall Islands
VL8 Pool Commercial employment and operation of Pool vessels Marshall Islands
Chronos8 Pool Commercial employment and operation of Pool vessels Marshall Islands
The aggregate information of jointly-controlled operations that are not individually material are
summarised as follows:
2022
2021
US$’000
US$’000
Current assets
109,896
76,036
Current liabilities
109,896
76,036
The Group’s share of net
revenue from Pools
205,941
354,165
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
49
4 Organisation and Trading Activities (cont’d)
(C) Non-controlling Interest
The details of non-wholly owned subsidiaries of the Group that have a material non-controlling
interest as at 31 March are as follows:
Name of subsidiaries
Proportion of
ownership interests
and voting rights held
by non-controlling
interest
Profit allocated to
non-controlling
interest
Accumulated
non-controlling
interest
2022
2021
2022
2021
2022
2021
%
%
US$’000
US$’000
US$’000
US$’000
Integr8 Group entities
(2022: Integr8 Fuels Inc &
Integr8 Fuels Pte. Ltd.; 2021:
Integr8 Fuels Inc
)
16.9
16.4
2
,
6
36
3,973
14,555
13,707
The following table summarises the financial information in respect of the subsidiaries that had a
material non-controlling interest. The summarised financial information represents amounts before
intragroup eliminations.
Integr8
Group
Integr8 Fuels
Inc
2022
2021
US$’000
US$’000
Summarised
B
alance
S
heet
Assets
Current
486,628
347,329
Liabilities
Current
(
395,310
)
(257,625)
Net assets
9
1,318
89,704
Attributable to owners of the Group
76,763
75,997
Non
-
controlling interest
14,555
13,707
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
50
4 Organisation and Trading Activities (cont’d)
(C) Non-controlling Interest (cont’d)
Integr8
Group
Integr8 Fuels
Inc
2022
2021
US$’000
US$’000
Summarised Profit or Loss
Revenue
3,086,792
1,771,733
Expenses
(
3,067,712
)
(1,749,410)
Net profit for the year
18,980
22,323
Other comprehensive income
-
-
Total comprehensive income for the year
18,980
22,323
Total comprehensive income attributable to
owners of the Group
16,344
18,350
Total comprehensive income attributable to non-controlling interest
of the Group
2
,
63
6
3,973
Cash flows
Cash flows generated from operating
activities
14,097
57,309
Cash flows generated from investing activities
36,549
3,808
Cash flows used in financing activities
(
472
)
(41,606)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
51
5 Revenue
Revenue of the Group consists of the following:
2022
2021
US$’000
US$’000
Performance obligations satisfied at a point in time
Bunker trading income
2,740,345
1,821,433
Commission income
3
3
,
72
7
55,785
2,774,072
1,877,218
Eliminations
(
15
5
,
349
)
(114,595)
2,618,723
1,762,623
Performance obligations satisfied over
time
Voyage charter freight income
892,0
39
1,011,306
Time and bareboat charter income
45,24
3
96,962
Administration fees
8,
0
90
9,198
Service
fees
2,164
5,595
947,536
1,123,061
Eliminations
(7
2
,7
75
)
(72,395)
874,761
1,050,666
3,493,4
8
4
2,813,289
The revenue streams per each business segment are shown before elimination in line with the way the
businesses are managed. The total revenue figure is stated after elimination of intercompany revenue.
6 Operating Expenses
2022
2021
US$’000
US$’000
Bunker purchases
2,670,783
1,758,051
Hire expenses
520,877
645,613
Ports, canals and towage
60,913
84,917
Commission expenses
19,270
22,432
Running costs
59,357
52,643
Depreciation of right
-
of
-
use assets on time charters
(Note 18)
34,687
59,297
Depreciation of vessels and pre
-
delivery costs (Note 13)
27,735
29,422
Bad debts write back
(89)
(173)
Amortisation of dry
-
docking costs (Note 13)
1,439
425
Others
727
740
3,395,699
2,653,367
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
52
6 Operating Expenses (cont’d)
2022
2021
US$’000
US$’000
Impairment loss on trade receivables
4,156
4,619
Write back of impairment loss on trade receivables
(2,832)
(4,891)
1,324
(272)
3,397,02
3
2,653,095
7 Other Income
2022
2021
US$’000
US$’000
Gain on financial assets,
at fair value through profit or loss
3,440
8,315
Gain on buy back of bonds
-
191
Dividend income from financial assets
83
29
Gain on sale of vessels
12,269
-
Gain on step acquisition of interest in a former associate to a
s
ubsidiar
y
190
-
Foreign exchange gain
-
net
31
2
-
Other income
1,914
1,039
18,208
9,574
8 Other Expenses
2022
2021
US$’000
US$’000
Foreign exchange loss
-
net
-
819
Provision for losses in an
associate
-
6,069
Loss on
buy back
of bonds
1,607
-
Other expenses
537
313
2,144
7,201
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
53
9 Administrative Expenses
Administrative expenses include the following significant balances:
2022
2021
US$’000
US$’000
Salaries and other staff
costs:
-
S
taff salaries and bonus
40,
716
42,996
-
Employer’s social security and pension contribution
3,537
3,391
-
Staff welfare and other staff costs
3,789
3,407
IT and communication
2,260
2,499
Office rental and utilities
1,273
1,069
Consultancy and other professional fees
1,994
1,892
Depreciation of
right
-
of
-
use on
office premises (Note 18)
1,990
1,
997
Depreciation of
other fixed assets
(Note 1
4)
751
1
,262
During the financial year, the Group has received government grant income related to various
temporary wage support schemes for businesses adversely impacted by the Covid-19 pandemic. The
Group recorded government grant income of US$0.2 million from the temporary wage support
schemes (2021: US$1.1 million).
10 Finance Income
2022
2021
US$’000
US$’000
Interest income from bank balances
55
185
11 Finance Costs
2022
2021
US$’000
US$’000
Interest expense on bank loan and other
borrowings
37,539
41,312
Interest expense on lease liabilities
4,743
9,158
Bank charges
445
459
42,727
50,929
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
54
12 Income Tax Expense
2022
2021
US$’000
US$’000
Income tax expense attributable to profit is made up of:
-
Current financial year
722
1,669
-
(Over)/u
nder provision in prior financial years
(5
06
)
337
216
2,006
Reconciliation between income tax expense and accounting profit at applicable tax rate:
2022
2021
US$’000
US$’000
Profit before income tax
11,058
50,452
Income tax calculated at applicable tax rate
1,
4
77
4,267
Utilisation of previously unrecognised tax losses
(169)
(344)
Deferred tax asset not recognised
1,244
119
Income exempt
ed
from tax or subject to lower tax incentive rate
(1,903)
(2,481)
Expenses
not
claimable for tax purposes
73
108
(Over)/u
nder provision in prior financial years
(5
06
)
337
Tax charge
216
2,006
Expenses not claimed for tax purposes relate to certain operating expenses of subsidiaries which are
not deductible for tax purposes in the jurisdiction where these subsidiaries operate.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
55
13 Vessels
Vessels and
Pre-delivery
costs
Dry-docking
Costs
Total
US$’000
US$’000
US$’000
2022
Cost
At 1 April
2021
759,014
2,945
761,959
Additions
4,295
3,931
8,226
Disposal
s
(88,970)
-
(88,970)
Acquisition of subsidiary
10,000
-
10,000
At 31 March
2022
684,339
6,876
691,215
Less:
Accumulated depreciation
At 1 April
2021
62,103
1,608
63,711
Charge for the financial year
27,735
1,439
29,174
Disposal
s
(9,699)
-
(9,699)
At 31 March
2022
80,139
3,047
83,186
Net book value
At 31 March
2022
604,200
3,829
608,029
2021
Cost
At 1 April
20
20
757,806
2,766
760,572
Additions
1,208
179
1,387
At 31 March
2021
759,014
2,945
761,959
Less:
Accumulated depreciation
At 1 April
20
20
32,681
1,183
33,864
Charge for the financial year
29,422
425
29,847
At 31 March
2021
62,103
1,608
63,711
Net
book value
At 31 March
2021
696,911
1,337
698,248
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
56
14 Other Fixed Assets
Office and
computer
equipment
Furniture
and fittings
Total
US$’000
US$’000
US$’000
2022
Cost
At 1 April
2021
1,736
2,221
3,957
Additions
82
96
178
At 31 March
2022
1,818
2,317
4,135
Less:
Accumulated depreciation
At 1 April
2021
1,356
1,094
2,450
Charge for the financial year
209
542
751
At 31 March
2022
1,565
1,636
3,201
Net book value
At 31 March
2022
253
681
934
2021
Cost
At 1 April
20
20
1,448
2,194
3,642
Additions
288
27
315
At 31 March
2021
1,736
2,221
3,957
Less:
Accumulated depreciation
At 1 April
20
20
637
551
1,188
Charge for the financial year
719
543
1,262
At 31 March
2021
1,356
1,094
2,450
Net book value
At 31 March
2021
380
1,127
1,507
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
57
15 Financial Assets
As at reporting date, the details of the Group’s financial assets are as follow:
2022
2021
US$’000
US$’000
Classified as current:
Financial assets/(liabilities), classified as
fair value through other comprehensive income
-
quoted equity investment (Note 15(a))
16,947
5,183
-
unquoted equity securities
-
*
-
*
-
forward contracts to hedge forecast transactions (Note 15(c))
-
134
-
commodity contracts
(Note 15(c))
(465)
-
16,482
5,317
Financial assets, classified as fair value through profit or loss
-
quoted equity investment (Note
15(a))
9,769
8,112
-
commodity contracts
(Note 15(
d
))
2,522
162
12,291
8,274
Total
28,773
13,591
* Less than US$1,000
(a) Movement in quoted equity investment, at fair value:
2022
2021
US$’000
US$’000
At 1 April
13,295
-
Additions
7,434
12,306
Disposals
(6,838)
(2,599)
Fair value gain recognised during the year:
-
recognised through other comprehensive income
12,117
2,503
-
recognised through profit or loss
708
1,085
At 31 March
26,716
13,295
(b) Details of unquoted equity securities, at fair value:
Percentage of equity
Country of Principal held by the Company
Name
incorporation
activities
2022
2021
% %
Navig8 SG JV LLC Marshall Islands Ship chartering 5
5
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
58
15 Financial Assets (cont’d)
(c) Derivatives financial instruments
The Group applied cash flow hedge accounting to its forward contracts and commodity contracts. The
fair value movements are recognised in fair value through other comprehensive income.
(d) Commodity contracts classified as fair value through profit or loss
The Group enters into commodity contracts which includes freight forwarding arrangements and stock
options. These are classified as fair value through profit or loss.
16 Interests in Associates
2022
2021
US$’000
US$’000
Cost of investments
28,874
35,056
Share of profits in associates
2,911
2,885
Share of dividends paid
(5,261)
(3,513)
Prepaid tax on share of
profits in associates
343
181
2
6
,
867
34,609
Amounts due from associates
(1)
750
1,618
At 31 March
27,617
36,227
2022
2021
US$’000
US$’000
Representing:
At 1 April
34,609
36,902
Additions
1,1
19
12
Derecognition of
interests in
associates
(
7
,
301
)
-
Share of current financial year’s profits
/(losses)
26
(400)
Share of dividends paid
(1,748)
(1,965)
Prepaid tax on share of profits in associates
162
60
At 31 March
2
6
,
867
34,609
(1)
The amounts due from associates represent quasi-equity interest-free loans which are stated at cost
as the repayments are neither planned nor likely to occur in the foreseeable future. It is impractical
to determine the terms of repayment as the timing of future cash flows cannot be measured reliably.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
59
16 Interests in Associates (cont’d)
Details of the associates are as follows:
Name
Country of
i
ncorporation
Effective
interest held by
the Group
Note
2022
2021
%
%
D8 Product Tankers I LLC
Marshall Islands
-
50
(a),
(
g
)
Navig8 Chemical Tankers Inc
Marshall Islands
-
3
(b),(c),(
d
)
SWS VLCC JV LLC
Marshall Islands
50
50
(b)
TB Marine Shipmanagement GmbH & Co. KG
Germany
50
51
(b),(d)
TB Marine Cont
Shipmanagement GmbH & Co.
Germany
50
50
(b)
DUNA Marine Shipmanagement
Latvia
30
30
(b)
Cassiopeia Shipmanagement (Cyprus) Ltd
Cyprus
30
30
(b)
GCC German Crew Center GmbH
Germany
30
30
(b)
Clean Marine Environmental Pte Ltd
Singapore
3
3
(a),(
e
)
Ridgebury Suez
2022
LLC
USA
18
18
(b),(
e
)
IQrew Management LLC
Russia
24
24
(b)
IQrew Management Ltd
Cyprus
24
24
(b)
Safe Route Marine Ltd
Cyprus
50
51
(b),(d)
Orient Maritime Agencies Pte Ltd
Singapore
49
-
(
f
)
Orientace Maritime (M) Sdn Bhd
Malaysia
28
-
(
f
)
Nakkas
Denizcilik Ve Ticaret Anonim Sirketi
Turkey
50
-
(
f
)
(a) Audited by Moore Stephens LLP, Singapore.
(b) The reporting date of the companies is 31 December. For the purpose of applying the equity
method of accounting, the financial statements of these companies for the year ended 31
December 2021 have been used and appropriate adjustments have been made for the effects
of significant transactions between that date and 31 March 2022.
(c) Audited by PricewaterhouseCoopers AS, Oslo, Norway.
(d) Disposed interest during the current financial year.
(e) Although the Group holds less than 20% of the equity shares in these entities, the Group
exercises significant influence by virtue of a contractual right to appoint a director.
(f) Acquired interests during the current financial year.
(g) During the current financial year, the Group, through one of its subsidiaries, acquired the
remaining interest in this company and this company is now wholly-owned by the Group and
the financial year end has been changed to 31 March.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
60
16 Interests in Associates (cont’d)
During the current financial year, the Group had the following transactions with the associates on the
terms agreed between the parties:
2022
2021
US$’000
US$’000
Service
fees received/receivable
47
3,938
Recharges received/receivable
11
31
Technical management fees
paid/payable
(31)
(991)
The following table summarises the financial information in respect of the material associate. The
summarised financial information below represents amounts before intragroup eliminations.
SWS VLCC JV LLC
2022
2021
US$’000
US$’000
Current assets
4
,
992
5,888
Non
-
current assets
79
,
836
83,380
Current liabilities
(
4,
369
)
(
4,365
)
Non
-
current liabilities
(
3
4
,3
51
)
(
37,013
)
Revenue
6
,
287
9,576
Expenses from continuing operations
(8,071)
(9,114)
Total comprehensive
(loss)/
income
(1,
78
4
)
462
Reconciliation of the above summarised financial information to the carrying amount of the interest
in SWS VLCC JV LLC recognised in the consolidated financial statements:
2022
2021
US$
’000
US$
’000
Net assets of SWS VLCC JV LLC
46,
108
47,890
Proportion of the Group’s ownership
50%
50%
Carrying amount of the Group’s interest
23,
054
23,945
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
61
16 Interests in Associates (cont’d)
The following table summarises, in aggregate, the Group’s share of profits and other comprehensive
income of the Group’s individual immaterial associates accounted for using the equity method:
2022
2021
US$
’000
US$
’000
The
Group
’s share of:
Profit from continuing
operations
1,056
630
Other comprehensive income
-
-
Total comprehensive
income
1,056
630
Aggregate carrying amount
of the Group’s interests in these associates
3
,
813
10,664
17 Interests in Joint Ventures
2022
2021
US$’000
US$’000
Cost of investments
4,
34
1
4,307
Share of profits in joint ventures
2,194
1,180
Share of dividends paid
(4,
91
1)
(4,462)
At 31 March
1,624
1,025
Representing:
At 1 April
1,025
3,917
Additions
-
*
-
*
Disposals
(16)
-
Repayment of
quasi equity interest
-
free
loan
50
-
Share of current financial years’ profits
1,014
242
Share of dividends paid
(
44
9)
(3,134)
At 31 March
1,62
4
1,025
* Less than US$1,000
Details of the joint ventures are as follows:
Name
Country of
i
ncorporat
i
on
Effective interest
held
by the Group
Note
2022
2021
%
%
Straits Shipping 4 Pte. Ltd.
Singapore
-
50
(a), (
b
)
Suntech Maritime Pte. Ltd.
Marshall Islands
50
51
(a),
(
b
)
, (c)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
62
17 Interests in Joint Ventures (cont’d)
(a) Audited by Moore Stephens LLP, Singapore.
(b) Disposed interests during the financial year.
(c) During the financial year, as a result of internal restructuring, Suntech Maritime Pte. Ltd.
became the new joint venture company and Suncorp Holdings Inc will be struck off
subsequent to the financial year ended 31 March 2022.
The summarised financial information of the joint ventures not adjusted for the proportionate
ownership interest held by the Group is as follows:
2022
2021
US$’000
US$’000
Assets and liabilities
Current assets
7,442
5,348
Non
-
current assets
301
471
Total
assets
7,743
5,819
Current liabilities
(3,470)
(3,222)
Non
-
current liabilities
-
-
Total liabilities
(3,470)
(3,222)
Net assets
4,273
2,597
The above assets and liabilities include the following:
2022
2021
US$’000
US$’000
Cash
and cash equivalents
3,647
2,256
Current financial liabilities (excluding trade payables
and amount due to shareholders)
1,614
1,398
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
63
17 Interests in Joint Ventures (cont’d)
During the current financial year, the Group had the following transactions with the joint ventures on
the terms agreed between the parties:
2022
2021
US$’000
US$’000
Monthly fees received/receivable
-
21
Technical management fees paid/payable
(3,
720
)
(2,379)
Hire expense paid/payable
-
(1,025)
18 Right-of-Use Assets
Time
c
harters
Office premises
Total
US$
’000
US$
’000
US$
’000
2022
Cost
At 1 April 2021
147,245
9,443
156,688
Lease modifications
(19,05
8
)
7
(19,05
1
)
At 31 March 2022
128,187
9,450
137,637
Less: Accumulated depreciation
At 1 April 2021
65,943
4,111
70,054
Charge for the financial year
34,68
7
1,990
36,67
7
Lease modifications
(27,922)
-
(27,922)
At 31 March 2022
72,708
6,101
78,80
9
Net book value
At 31 March 2022
55,4
79
3,34
9
58,828
2021
Cost
At 1 April 2020 110,103 8,822 118,925
Additions
58,712
621
59,333
Lease modifications
(21,570)
-
(21,570)
At 31 March 2021
147,245
9,443
156,688
Less: Accumulated depreciation
At 1 April 2020
20,171
2,114
22,285
Charge for the financial year
59,297
1,997
61,294
Lease modifications
(13,525)
-
(13,525)
At 31 March 2021
65,943
4,111
70,054
Net book value
At 31 March 2021
81,302
5,332
86,634
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
64
19 Inventories
2022
2021
US$’000
US$’000
Bunkers, at cost
28,678
16,574
The bunker costs recognised during the current financial year is presented under operating expenses
(Note 6).
20 Trade and Other Receivables and Prepayments
2022
2021
US$’000
US$’000
Trade receivables:
Third parties
374,845
254,274
Less: Allowance for impairment losses
(7,132)
(6,651)
367,713
247,623
Other receivables:
Third parties
25,97
7
27,655
Related parties
44,27
4
44,364
70,251
72,019
Prepayments
13,252
15,933
451,216
335,575
During the financial years ended 31 March 2022 and 2021, the Group has factored trade receivables
to financial institutions in exchange for cash. The business model is to hold the assets to collect
contractual cash flows. The transaction has been accounted for as a collateralised borrowing as the
Group retains the risk in the event of default by these customers. As at 31 March 2022, the carrying
amount and fair values of the transferred receivables are US$90.8 million (2021: US$86.6 million)
and the carrying amount of the associated liability is US$81.7 million (2021: US$77.9 million).
The exposures to credit and currency risks are disclosed in Note 32 to the consolidated financial
statements.
2022
2021
US$’000
US$’000
Accrued receivables:
Freight revenue earned but not billed
125,347
63,222
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
65
20 Trade and Other Receivables and Prepayments (cont’d)
Accrued receivables represent the Group’s right to consideration for work completed but not billed at
the reporting date. Invoices are billed to customers when the rights become unconditional. The
transaction prices allocated to unsatisfied performance obligations will be recognised within the next
one year. The significant changes in the accrued receivables at the reporting date are as follows:
2022
2021
US$’000
US$’000
Accrued
receivables:
Accrued receivables reclassified to trade receivables
(63,222)
(142,377)
Changes in measurement of progress
125,347
63,222
21 Cash and Bank Balances
2022
2021
US$
’
000
US$
’
000
Cash at banks and on hand
129,831
160,909
Cash and bank balances in the consolidated statement of cash flows comprise:
2022
2021
US$
’
000
US$
’
000
Cash and bank balances
129,831
160,909
Less: Bank balances pledged with financial institutions
(1,476)
(1,480)
Cash and bank balances as
disclosed in the consolidated statement of cash flows
128,355
159,429
The weighted average effective interest rate on bank deposits as at 31 March 2022 is 0.2% (2021:
0.2%) per annum.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
66
22 Share Capital
2022
2021
No. of shares
Amount
No. of shares
Amount
US$
’
000
US$
’
000
Issued and fully paid
shares:
At 1 April and 31 March
1,000
1
1,000
1
The par value for these ordinary shares is US$1 per share.
The holder of ordinary share is entitled to receive dividends as and when declared by the Company’s
board of directors. Each ordinary share carries one vote per share without restrictions.
23 Reserves
2022
2021
US$
’
000
US$
’
000
Fair value reserve
13,522
(721)
Other
reserve
(8,73
0
)
(9,093)
Retained earnings
282,345
274,533
At 31 March
28
7,137
264,719
Fair value reserve
The fair value reserve records the cumulative fair value changes of financial assets through other
comprehensive income until they are de-recognised or impaired. The movement of the Group’s fair
value reserve during the financial year is as follows:
2022
2021
US$
’
000
US$
’
000
At 1 April
(721)
(4,823)
Fair value gain recognised during the financial year
14,243
4,102
At 31 March
13,522
(721)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
67
24 Non-Controlling Interests
2022
2021
US$
’
000
US$
’
000
At 1 April
13,707
13,614
Share of profits for the financial year
2,636
4,694
Dividends paid during the financial year
(2,196)
(2,793)
Effects of change of interests in subsidiaries
408
670
Acquisition of additional interest in subsidiaries (Note 4(A))
-
(2,479)
Exercise of share options during the
financial year
-
1
At 31 March
14,555
13,707
A dividend amounting to US$2.2 million (2021: US$2.8 million) was approved and paid out of the
retained earnings of subsidiaries from the current year’s profits to non-controlling interests during the
current financial year.
25 Bank Loan
2022
2021
US$’000
US$’000
Bank loan
-
Non
-
current
-
563
-
Current
563
563
563
1,126
The weighted average interest rate for the bank loan is 3.4% (2021: 3.7%) per annum with maturity
period of 1 year (2021: 2 years). The bank loan is secured by mortgage of a vessel and a corporate
guarantee from the ultimate holding company.
There were no defaults or breaches of the loan agreement terms for the financial years ended 31 March
2022 and 2021.
26 Other Borrowings
2022
2021
US$
’
000
US$
’
000
Other borrowings
-
Non
-
current
452,843 558,092
-
Current
45,366
38,761
498,209
596,853
The weighted average interest rates for the other borrowings range from 4% to 12% (2021: 5% to
12%) per annum with maturity periods from 2 to 10 years (2021: 2 to 10 years).
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
68
26 Other Borrowings (cont’d)
The Group, through its subsidiaries, has entered into various contracts with third parties for the sale
of vessels under construction and vessels. The Group further entered into bareboat charter agreements
for these vessels. Where no obligation to purchase the vessels is included, the Group has applied its
judgment and determined that the exercise of the purchase option is “almost certain” and treated as
financing arrangements. The ultimate holding company provides guarantees of the obligations entered
into by the subsidiaries.
At the reporting date, the net carrying amounts of these vessels amounted to US$597 million (2021:
US$687 million) (Note 13).
Senior Secured Callable Bonds
On 3 May 2019, the Company issued 12% fixed rate bonds denominated in USD with a nominal value
of $100 million. The bonds are due for repayment four years from the issue date at their nominal
value. The Company bought back or redeemed US$30.5 million (2021: US$1.4 million) of bonds
during the financial year.
27 Short-term Borrowings
During the financial years ended 31 March 2022 and 2021, the Group benefited from credit-line
facilities obtained by some of its pools and its bunker trading division. The facilities are secured by a
floating charge over the assets of the borrower and are made available through draw-downs in tenures
of not more than 120 days. The average interest rate is 2.8% (2021: 2.8%) per annum.
Short-term borrowings related to the pools represent the Group’s share of the facilities on
consolidation of the pools’ assets and liabilities. There were no defaults or breaches of terms of the
facilities for the financial years ended 31 March 2022 and 2021.
28 Trade and Other Payables
2022
2021
US$
’
000
US$
’
000
Trade payables
318,608
204,518
Accruals
11
5,905
78,617
Other payables
40,10
8
54,059
Related parties
12,015
12,611
486,
636
349,805
The amounts due to related parties are non-trade in nature, unsecured, interest-free and repayable on
demand.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
69
29 Lease Liabilities
(a) The Group as a lessee
The Group has entered into several commercial leases for the office premises and facilities for lease
terms between two to ten years (2021: two to ten years). The Group also chartered in a number of
vessels under time charter agreements. The lease terms range from two to five years (2021: two to
five years) with extension periods where the related lease payments have not been included in the
lease liabilities as the Group is not reasonably certain to exercise these extension options.
The carrying amounts of the right-of-use assets are as follows:
2022
2021
US$’000
US$’000
Office premises
3,34
9
5,332
Time charters
55,4
79
81,302
58,828
86,634
Additions of right-of-use assets for office premises and time charters are presented in Note 18 to the
consolidated financial statements.
Amounts recognised in the consolidated statement of comprehensive income and consolidated
statement of cash flows are as follows:
2022
2021
US$’000
US$’000
Depreciation charged for the year:
-
Office
premises
1,990
1,997
-
Time charters
34,687
59,297
Interest on lease liabilities relating to office premises and time
charters
4,743
9,158
Expenses relating to low value leases
10
10
Expenses relating to short
-
term leases
85,109
155,295
Total cash outflow for leases (excluding short
-
term leases)
37,327
62.377
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
70
29 Lease Liabilities (cont’d)
(a) The Group as a lessee (cont’d)
The Group recognised lease liabilities as follows:
2022
2021
US$’000
US$’000
Lease liabilities
Current
24,028
41,307
Non
-
current
35,438
46,614
59,466
87,921
(b) The Group as a lessor
The Group has leased out vessels under time charter and bareboat charter arrangements. Undiscounted
lease payments from the operating leases to be received after the reporting date are set out in Note 33
to the consolidated financial statements.
30 Cash Flows Arising from Financing Activities
The reconciliation of movements of liabilities to cash flows arising from financing activities are
presented below:
Cash flows
At
1 April
Proceeds
Repayments
Non-cash
changes
At
31 March
US$’000
US$’000
US$’000
US$’000
US$’000
2022
Bank loan and other borrowings
(Notes 25 and 26)
597,979 56,000 (165,097) 9,890 498,772
Short
-
term borrowings (Note 27)
98,453
15,770
-
-
114,223
Lease liabilities (Note 29)
87,921
-
(37,327)
8,872
59,466
2021
Bank loan and other borrowings
(Notes 25 and 26)
637,972 - (39,993) - 597,979
Short
-
term borrowings (Note 27)
185,728
-
(87,275)
-
98,453
Lease liabilities (Note 29)
99,010
-
(62,377)
51,288
87,921
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
71
31 Segment Information
Information concerning about reportable segments for the financial year are as follows:
Asset Management – includes voyage charter freight income and time and bareboat charter
income.
Services – includes bunker trading income, commission income, administration fees and service
fees.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
72
31 Segment Information (cont’d)
(A) Segment revenue and results
The following is an analysis of the Group’s revenue and results from continuing operations by reportable segment:
Asset
Reportable
segments
Management
Services
Subtotal
Eliminations
Total
US$’000
US$’000
US$’000
US$’000
US$’000
2022
Revenue
585,197
3,339,847
3,925,044
(431,560)
3,493,484
Operating expenses
(560,60
4
)
(3,256,85
4
)
(3,817,45
8
)
420,43
5
(3,397,023)
Profit from operations
24,59
3
82,99
3
107,58
6
(11,125)
96,461
Other income
17,928
1,583
19,511
(1,303)
18,208
Other expenses
(2
,
144)
(213)
(2,357)
213
(2,144)
Administrative expenses
(594)
(
70
,
366
)
(
7
0,960
)
11
,125
(
59,835
)
Finance income
70
1,5
79
1,649
(1,594)
55
Finance costs
(41,487)
(2,834)
(44,321)
1,594
(42,727)
Share of profits
in associate
s
and joint ventures
(1,582)
2,622
1,040
-
1,040
Profit before
income
tax
(3,21
6
)
15,364
12,148
(
1
,09
0
)
11,058
Income tax
expense
-
(
216
)
(
216
)
-
(
216
)
Net profit for the financial year
(3,21
6
)
15,148
11,932
(
1
,09
0
)
10,842
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
73
31 Segment Information (cont’d)
(A) Segment revenue and results (cont’d)
The following is an analysis of the Group’s revenue and results from continuing operations by reportable segment: (cont’d)
Asset
Reportable
segments
Management
Services
Subtotal
Eliminations
Total
US$’000
US$’000
US$’000
US$’000
US$’000
2021
Revenue
682,833
2,447,328
3,130,161
(316,872)
2,813,289
Operating expenses
(613,964)
(2,344,776)
(2,958,740)
305,645
(2,653,095)
Profit from operations
68,869
102,552
171,421
(11,227)
160,194
Other income
8,585
1,489
10,074
(500)
9,574
Other expenses
(6,380)
(1,321)
(7,701)
500
(7,201)
Administrative expenses
(996)
(71,444)
(72,440)
11,227
(61,213)
Finance
income
60
1,515
1,575
(1,390)
185
Finance costs
(48,821)
(3,498)
(52,319)
1,390
(50,929)
Share of
(losses)/
profits in associates and joint ventures
(2,630)
2,472
(158)
-
(158)
Profit before income tax
18,687
31,765
50,452
-
50,452
Income tax
expense
-
(2,006)
(2,006)
-
(2,006)
Net profit for the financial year
18,687
29,759
48,446
-
48,446
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
74
31 Segment Information (cont’d)
(B) Reconciliation
2022
2021
US$’000
US$’000
(i) Segment assets
Asset Management
897,719
975,455
Services
739,97
7
671,130
Total segment assets
1,
637
,
69
6
1,646,585
Eliminations
(
176,819
)
(233,073)
Consolidated total assets
1,460,87
7
1,413,512
(ii) Segment liabilities
Asset Management
(
824,0
29
)
(999,862)
Services
(
469,972
)
(333,672)
Total segment liabilities
(1,
294,
001
)
(1,333,534)
Eliminations
1
34,817
198,449
Consolidated total liabilities
(1,159,
184
)
(1,135,085)
(C) Other segment information
Depreciation and
amortisation
Additions to
non
-
current assets
2022
2021
2022
2021
US$’000
US$’000
US$’000
US$’000
Asset Management
63,860
89,146
8,226
60,099
Services
2,742
3,257
1
7
8
936
Total
66,602
92,403
8,40
4
61,035
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
75
32 Financial Risk Management Objectives and Policies
(A) Financial Risk Factors
The Group’s activities expose it to a variety of financial risks: market risk (including charter rate risk,
interest rate risk and foreign currency risk), credit risk and liquidity risk arising in the normal course
of the Group’s business. The Group’s risk management seeks to minimise the potential adverse effects
from these exposures. The management reviews and agrees policies for managing each of these risks
and they are summarised below:
(a) Market Risk
(i) Charter rate risk
The Group’s operating revenue principally comprises of income from voyage charter freight and from
bareboat charters and time charters which ranges from 2 to 10 years (2021: 2 to 10) years.
(ii) Interest rate risk
Cash flow interest rate risk is the risk that the future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. Fair value interest rate risk is the risk that the value of a
financial instrument will fluctuate due to changes in market interest rates.
The Group is exposed to interest rate risk because entities in the Group borrow at fixed and floating
rates. The risk is managed by maintaining an appropriate mix of fixed and floating borrowings,
including the use of swaps and other financial instruments where appropriate.
The Group has no significant interest bearing assets, other than bank deposits and cash equivalents.
The Group has no significant interest bearing liabilities, other than bank loans and finance lease
obligations and the Group’s income and operating cash flows are substantially independent of changes
in market interest rates. The Group’s policy is to obtain the most favourable interest rates wherever
possible and constantly monitor the interest rate movements.
A fundamental financial industry reform of interest rate benchmarks is being undertaken globally,
including the cessation and replacement of interbank offered rates (“IBORs”) with alternative nearly
risk-free rates (referred to as “interest rate benchmark reform”). The Group’s interest rate risk that is
directly affected by the interest rate benchmark reform predominantly comprises its variable rate
borrowings. As at 31 March 2021, the Group has variable rate borrowings (Note 26) that are indexed
to LIBOR, which will lose its representativeness after 30 June 2023. The expected transition from
LIBOR to other index benchmark had no effect on the amounts reported for the current and prior
financial years. At the reporting date, the Group has not transited such variable rate borrowings (Note
26) to an alternative benchmark rate.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
76
32 Financial Risk Management Objectives and Policies (cont’d)
(A) Financial Risk Factors (cont’d)
(a) Market Risk (cont’d)
(ii) Interest rate risk (cont’d)
The tables below set out the Group’s exposure to interest rate risks. Included in the tables are the assets
and liabilities at carrying amounts, categorised by the maturity dates.
Variable rates
Fixed rates
Less than
More than
Less
than
More than
12
months
2 to 5
years
5 years
12
months
2 to 5
years
5 years
Non-Interest
Bearing
Total
US$
’
000
US$
’
000
US$
’
000
US$
’
000
US$
’
000
US$
’
000
US$
’
000
US$
’
000
2022
Assets
Cash and bank balances
129,831
-
-
-
-
-
-
129,831
Trade and other
receivables (except
prepayments)
-
-
-
-
-
-
437,964
437,964
Accrued receivables
-
-
-
-
-
-
125,347
125,347
Total financial assets
129,831
-
-
-
-
-
563,311
693,142
Liabilities
Trade and other payables
-
-
-
-
-
-
486,
636
486,
636
Bank loan
563
-
-
-
-
-
-
563
Other borrowings
38,813
131,423
249,038
6,553
72,382
-
-
498,209
Short
-
term borrowings
114,223
-
-
-
-
-
-
114,223
Lease liabilities
-
-
-
24,028
35,347
91
-
59,466
Total financial liabilities
153,599
131,423
249,038
30,581
107,729
91
486,
636
1,159,
097
2021
Assets
Cash and bank balances
160,909
-
-
-
-
-
-
160,909
Trade and other
receivables (except
prepayments)
-
-
-
-
-
-
319,642
319,642
Accrued receivables
-
-
-
-
-
-
63,222
63,222
Total financial assets
160,909
-
-
-
-
-
382,864
543,773
Liabilities
Trade and other payables
-
-
-
-
-
-
349,805
349,805
Bank loan
563
563
-
-
-
-
-
1,126
Other
borrowings
32,208
142,043
307,126
6,553
108,923
-
-
596,853
Short
-
term borrowings
98,453
-
-
-
-
-
-
98,453
Lease liabilities
-
-
-
41,307
46,411
203
-
87,921
Total financial liabilities
131,224
142,606
307,126
47,860
155,334
203
349,805
1,134,158
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
77
32 Financial Risk Management Objectives and Policies (cont’d)
(A) Financial Risk Factors (cont’d)
(a) Market Risk (cont’d)
(ii) Interest rate risk (cont’d)
A 3% increase/(decrease) in the interest rate of the bank loan at the reporting date would result in a
corresponding (decrease)/increase of profit before income tax as follows:
2022
2021
US$
’
000
US$
’
000
Profit before income tax
27
47
This analysis assumes that all other variables remain constant.
(iii) Foreign currency risk
The Group is not exposed to significant foreign currency risk on its operating activities as most
transactions and balances are denominated in United States dollar, as shown below.
United
Sta
tes Dollar
Singapore
Dollar
Pound
Sterling
Others
Total
US$
’
000
US$
’
000
US$
’
000
US$
’
000
US$
’
000
2022
Financial assets
Cash and bank balances
123,717
355
114
5,645
129,831
Trade and other receivables
(except prepayments)
428,869
1,611
258
7,226
437,964
Accrued receivables
125,347
-
-
-
125,347
677,933
1,966
372
12,871
693,142
Financial liabilities
Trade and other payables
(47
8,883
)
(
929
)
(638)
(6,186)
(486,
636
)
Bank loan
(563)
-
-
-
(563)
Other borrowings
(498,209)
-
-
-
(498,209)
Short
-
term borrowings
(114,223)
-
-
-
(114,223)
Lease liabilities
(56,222)
(1,545)
(1,422)
(277)
(59,466)
(1,148,
100
)
(2,
474
)
(2,060)
(6,463)
(1,159,
097
)
Currency exposure on net
financial
(liabilities)/assets
(
508
)
(1,688)
6,408
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
78
32 Financial Risk Management Objectives and Policies (cont’d)
(A) Financial Risk Factors (cont’d)
(a) Market Risk (cont’d)
(iii) Foreign currency risk (cont’d)
The Group is not exposed to significant foreign currency risk on its operating activities as most transactions
and balances are denominated in United States dollar, as shown below.
United
States Dollar
Singapore
Dollar
Pound
Sterling
Others
Total
US$’000
US$’000
US$’000
US$’000
US$’000
202
1
Financial assets
Cash and bank balances
156,585
862
140
3,322
160,909
Trade and other receivables
(except prepayments)
312,044
1,131
200
6,267
319,642
Accrued receivables
63,222
-
-
-
63,222
531,851
1,993
340
9,589
543,773
Financial liabilities
Trade and other payables
(341,964)
(3,242)
(1,782)
(2,817)
(349,805)
Bank loan
(1,126)
-
-
-
(1,126)
Other borrowings
(596,853)
-
-
-
(596,853)
Short
-
term borrowings
(98,453)
-
-
-
(98,453)
Lease
liabilities
(82,456)
(2,353)
(2,525)
(587)
(87,921)
(1,120,852)
(5,595)
(4,307)
(3,404)
(1,134,158)
Currency exposure on net
financial (liabilities)/assets
(3,602)
(3,967)
6,185
Management is of the view that the foreign currency risk is not significant to warrant disclosure of a
sensitivity analysis.
(b) Credit Risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in
financial loss to the Group.
The Group’s primary exposure to credit risk arises through its trade and other receivables. It is the
Group’s policy to enter into transactions with creditworthy customers to mitigate any significant credit
risk. The Group has procedures in place to control credit risk and exposure to such risk is monitored
on an ongoing basis.
The Group’s maximum exposure to credit risk in relation to each class of recognised financial assets
is the carrying amount of those assets as indicated in the consolidated balance sheet.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
79
32 Financial Risk Management Objectives and Policies (cont’d)
(A) Financial Risk Factors (cont’d)
(b) Credit Risk (cont’d)
The Group does not have any significant concentration of credit risk.
Credit Risk Grading Guideline
The internal credit risk grading which are used to report the Group’s credit risk exposure to key
management personnel for credit risk management purposes are as follows:
Internal
rating grades
Definition
Basis of recognition
of expected credit loss
i. Performing The counterparty has a low risk of default and does
not have any
significant past
-
due amounts
.
12-month ECL
ii. Under-
performing
There has been a significant increase in credit risk
since initial recognition (i.e interest and/or principal
repayment are more than 30 days past due).
Lifetime ECL
(not credit impaired)
iii. Non-
performing
There is evidence indicating that the asset is credit
impaired (i.e interest and/or principal repayments are
more than 90 days past due).
Lifetime ECL
(credit impaired)
iv. Write-off There is evidence indicating that there is no
reasonable expectation of recovery as the debtor is in
severe financial difficulty (i.e interest and/or
principal repayments are more than 180 days past
due).
Asset is written off
Based on the Group’s internal rating assessment, other than those disclosed in the financial statements,
there are no financial assets that are under-performing, non-performing and assets written off during
the financial year. The credit quality of the Group’s performing financial assets, as well as maximum
exposure to credit risk by internal credit risk assessments are as follows:
Cash and Cash Equivalents and Other Financial Assets
Cash and cash equivalents are proceeds with financial institution counterparties, which are rated Aa1
to A2, based on rating agency ratings. Debt instruments measured at amortised cost are considered
low credit risks as the instrument is of a good rating.
Impairment on cash and cash equivalents and other financial assets have been measured on the
12-month expected loss basis and reflects the short maturities of the exposures. The Group considers
that these financial assets have low credit risk based on the external credit ratings of the counterparties
and these counterparties having low risk of default. The amount of the loss allowance on these
financial assets are assessed to be minimal. The gross and net carrying amounts of these financial
assets are disclosed in Note 20 and Note 21 to the consolidated financial statements.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
80
32 Financial Risk Management Objectives and Policies (cont’d)
(A) Financial Risk Factors (cont’d)
(b) Credit Risk (cont’d)
Trade Receivables and Accrued Receivables
As disclosed in Note 2(p), loss allowance for trade receivables and accrued receivables have been
recognised at an amount equal to lifetime expected credit losses. The Group has assessed the financial
assets as performing, counterparties have low risk of default and do not have any historical defaults.
The provision rates are determined based on the Group’s historical observed default rates analysed in
accordance with days past due by grouping of customers based on segment.
The gross and net carrying amount of trade receivables are set out in Note 20 to the consolidated
financial statements. The table below is an analysis of trade receivables at the reporting date:
Gross
carrying
amount
Lifetime
expected
credit losses
Net
carrying
amount
US$’000
US$’000
US$’000
2022
Credit impaired assets:
Third
p
arties
6,944
(5,274)
1,670
Others
:
Third
p
arties
Current
314,422
(856)
313,566
Past due:
Up to three months
45,938
(646)
45,292
More than three months
7,541
(356)
7,185
374,845
(7,132)
367,713
2021
Credit impaired assets:
Third parties
7,987
(5,476)
2,511
Others:
Third parties
Current
198,523
(547)
197,976
Past due:
Up to three months
36,414
(437)
35,977
More than three months
11,350
(191)
11,159
254,274
(6,651)
247,623
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
81
32 Financial Risk Management Objectives and Policies (cont’d)
(A) Financial Risk Factors (cont’d)
(b) Credit Risk (cont’d)
The movement in allowance for impairment of trade receivables is as follows:
2022
2021
US$’000
US$’000
At 1 April
6,651
8,838
Impairment for the year (Note 6)
4,156
4,619
Impairment written back (Note 6)
(2,832)
(4,891)
Impairment written off
(843)
(1,915)
At 31 March (Note 20)
7,132
6,651
The impaired trade receivables arose from long outstanding amounts which remained unpaid at the
reporting date and accordingly there are significant uncertainties on the recovery of the amounts. None
of the trade receivables that have been written off is subject to enforcement activities.
(c) Liquidity Risk
In the management of liquidity risk, the Group monitors and maintains a level of cash and bank
balances deemed adequate by the management to finance the Group’s operations and mitigate the
effects of fluctuations in cash flows.
The following table is an analysis of the maturity profile of the Group’s financial liabilities based on the
expected contractual undiscounted cash outflows, including interest payments.
Carrying
Amounts
Cash Flows
Contractual
cash flows
Within
one year
Between
two to five
years
After
five years
US$’000
US$’000
US$’000
US$’000
US$’000
202
2
Trade and other payables
(486,
636
)
(486,
636
)
(486,
636
)
-
-
Bank loan
(563)
(582)
(582)
-
-
Other
borrowings
(498,209)
(605,739)
(71,698)
(259,584)
(274,457)
Short
-
term borrowing
(114,223)
(114,223)
(114,223)
-
-
Lease liabilities
(59,466)
(65,51
2
)
(27,276)
(38,14
2
)
(94)
(1,159,
097
)
(1,272,
692
)
(700,
415
)
(297,72
6
)
(274,551)
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
82
32 Financial Risk Management Objectives and Policies (cont’d)
(A) Financial Risk Factors (cont’d)
(c) Liquidity Risk (cont’d)
The following table is an analysis of the maturity profile of the Group’s financial liabilities based on the
expected contractual undiscounted cash outflows, including interest payments. (cont’d)
Carrying
Amounts
Cash Flows
Contractual
cash flows
Within
one year
Between
two to five
years
After
five years
US$’000
US$’000
US$’000
US$’000
US$’000
2021
Trade and other payables
(349,805)
(349,805)
(349,805)
-
-
Bank loan
(1,126)
(1,188)
(604)
(584)
-
Other borrowings
(596,853)
(746,813)
(72,558)
(333,362)
(340,893)
Short
-
term borrowing
(98,453)
(98,453)
(98,453)
-
-
Lease liabilities
(87,921)
(97,949)
(45,990)
(51,743)
(216)
(1,134,158)
(1,294,208)
(567,410)
(385,689)
(341,109)
(B) Capital Risk Management
The Group’s objectives when managing capital are to safeguard the Group’s ability to operate as a
going concern in order to provide adequate returns for shareholders and benefits for other
stakeholders, to support the Group’s stability and growth; and to provide capital for the purpose of
strengthing the Group’s financial management capability. There is no change in its capital
management policy during the current and previous financial year.
The Group actively and regularly reviews and manages its capital structure to ensure an optimal capital
structure and shareholder returns, taking into consideration the future capital requirements of the
Group and capital efficiency, prevailing and projected profitability, projected operating cash flows,
projected capital expenditures and projected strategic investment opportunities.
Capital includes share capital, reserves and interest bearing debts.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
83
32 Financial Risk Management Objectives and Policies (cont’d)
(B) Capital Risk Management (cont’d)
The Group monitors capital based on a number of measures, including leverage ratio. The leverage
ratio is computed as short and long-term debts over total assets. Short and long-term debts comprise
short-term borrowings, other borrowings and the bank loans.
2022
2021
US$’000
US$’000
Short and long
-
term debts
612,995
696,432
Total assets
1,460,87
7
1,413,512
Leverage ratio
42%
49%
The Group does not have to comply with any externally imposed capital requirements for the financial
years ended 31 March 2022 and 2021.
(C) Fair Value Estimation
The Group presents financial assets measured at fair value and classified by level of the following fair
value measurement hierarchy:
Level 1 – Quoted prices (unadjusted) in active market for identical assets or liabilities that the Group
can access at the measurement date;
Level 2 – Inputs other that quoted prices included within Level 1 that are observable for the asset or
liability, either directly or indirectly, and
Level 3 – Unobservable inputs for the asset or liability.
Fair value measurements that use inputs of different hierarchy levels are 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.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
84
32 Financial Risk Management Objectives and Policies (cont’d)
(C) Fair Value Estimation (cont’d)
(i) Fair Value of the Group’s financial assets and financial liabilities that are measured at fair
value on a recurring basis.
Level 1
Level 2
Level 3
Total
US$’000
US$’000
US$’000
US$’000
Financial assets
2022
28,634
139
*
28,773
2021
13,295
296
*
13,591
* less than US$1,000
Financial assets
Transfer of financial assets
The Group’s policy is to regard transfers between fair value levels as having occurred at the date of
the event giving rise to those transfers. There were no transfers between fair value levels during the
financial year.
Level 1 Fair value measurement
The fair value of the financial assets are measured based on the current bid price as at year end.
Level 2 Fair value measurement
The fair value of forward contracts is determined using quoted forward currency rates at the balance
sheet date. Observable prices are used for commodity contracts as a measure of fair value.
(ii) Fair value of the Group’s financial assets and financial liabilities that are not measured at fair
value on a recurring basis
Except as detailed in the following table, the carrying amounts of financial assets and liabilities with a
maturity of less than one year, which include cash and bank balances, receivables and payables are
assumed to approximate their fair values due to their short-term maturities.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
85
32 Financial Risk Management Objectives and Policies (cont’d)
(C) Fair Value Estimation (cont’d)
(ii) Fair value of the Group’s financial assets and financial liabilities that are not measured at fair
value on a recurring basis (cont’d)
The carrying values of the bank loan and other borrowings and lease liabilities compared to fair values
are shown below:
2022
2021
Carrying
value
Fair
value
Carrying
value
Fair
value
US$
’
000
US$
’
000
US$
’
000
US$
’
000
Classified as Level 2 of
Fair value hierarchy
Bank loan and other borrowings
498,772
475,095
597,979
580,006
Lease liabilities
59,466
59,466
87,921
87,921
The fair values disclosed above are estimated by discounting expected future cash flows at market
interest rate for similar lending arrangements at the reporting date.
33 Commitments
(a) Operating lease receipts
As Lessor
At reporting date, the Group’s subsidiaries and joint venture companies have chartered out a number
of vessels under time charter and bareboat charter agreements which are classified as non-cancellable
operating leases. These charters have terms ranging from two to three years. Undiscounted lease
payments from the operating leases to be received after the reporting date are as follows:
2022
2021
US$’000
US$’000
Due:
Within one year
32,421
35,192
One to two years
2,94
1
29,018
Two to three years
-
2,94
1
35,362
67,15
1
Operating lease receipts are recognised in profit or loss during the financial year as part of revenue.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
FOR THE FINANCIAL YEAR ENDED 31 MARCH 2022
86
33 Commitments (cont’d)
(b) Capital commitments
At reporting date, capital expenditure contracted for as at 31 March but not recognised in the financial
statements is as follows:
2022
2021
US$’000
US$’000
Commitments
related to shipyard instalments
170,304
-
34 Related Party Transactions
In addition to the transactions and balances disclosed elsewhere in these financial statements, the
Group entered the following material related party transactions:
Key Management Personnel
The Group’s key management decisions are undertaken by its directors. The directors are employed
and remunerated by the subsidiaries of the Company.
35 Earnings Per Share
(a) Basic Earnings per Share
Basic earnings per share is calculated by dividing the net profit attributable to equity holders of the
Group by the weighted average number of ordinary shares issued during the financial year as follows:
2022
2021
US$’000
US$’000
Net
profit attributable to equity holders of the Group
8,206
43,752
Weighted average number
of ordinary shares outstanding for basic earnings per share
1
1
Basic earnings per share
8,206
43,752
(b) Diluted Earnings per Share
For the purpose of calculating diluted earnings per share, profit attributable to equity holders of the
Group and the weighted average number of ordinary shares issued are adjusted for the effects of all
potentially dilutive ordinary shares.
There are no potentially dilutive shares during the financial years ended 31 March 2022 and 2021.
Accordingly, the diluted earnings per share is computed to be the same as the basic earnings per share
for the financial years ended 31 March 2022 and 2021.
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
07/14/22 12:22 PM – CJ / CKW - ( Kang Wai - )/ Navig8 Marshall_Grp IFRS : Topco Conso_2022 30.06.2022 (V6)(from
MS) JK reviewed
31 MARCH 2022
CONTENTS PAGE
Report of the
Directors
1
-
2
Independent Auditor
’
s Report
3
-
7
Consolidated Statement of Comprehensive Income
8
Consolidated Balance Sheet
9
Consolidated Statement of Changes in Equity
10
-
1
1
Consolidated
Statement of
Cash Flows
1
2
-
1
3
Notes to the Consolidated Financial Statements
1
4
–
8
6
NAVIG8 TOPCO HOLDINGS INC
(Incorporated in the Marshall Islands)
AND ITS SUBSIDIARIES
REPORT OF THE DIRECTORS
AND CONSOLIDATED FINANCIAL STATEMENTS
31 MARCH 2022
