F.6. Non-current assets held for sale and discontinued operations
No assets are classified as held for sale as at 31 December 2015.
A property in the amount CZK 6 million ceased to be classified as non-current assets held for sale due to failed negotiations with a buyer which resulted into changes to a plan of sale. The management has decided to keep the property as an investment property.
With the main goal to simplify the management structure of Generali CEE operations in the Central Europe and due to new regulatory requirements arising from the introduction of Solvency II rules, the Group management approved the decision of GCEE bodies transfer the Polish operations through the sale of the insurance portfolio and all related business activities to GENERALI TOWARZYSTWO UBEZPIECZEŃ S.A., a subsidiary of Generali CEE Holding B.V. The sale was completed as at 31 December 2015 and a gain on sale in amount of CZK 56 million has been recognised.
As a result of the decision, the Polish operations were classified discontinued operations as at 31 December 2015. The overview of related assets and liabilities sold is disclosed below. The following table shows the contribution of discontinued operations to the income statement for the period to 31 December. Net result of discontinued operations is presented on the line “Loss after tax from discontinued operation”.
| In CZK million | 2015 | 2014 |
|---|---|---|
| Income Statement | ||
| Net earned premiums revenue | 1,754 | 1,479 |
| Interests and other investment income | 77 | 38 |
| Other income from financial instruments and other investments | 18 | 1 |
| Net income/loss from financial instruments at fair value through profit or loss | (17) | (19) |
| Other income | 84 | 71 |
| Total income | 1,916 | 1,570 |
| Net insurance benefits and claims | (2,226) | (1,221) |
| Interest and other expenses for financial instruments and other investments | (50) | (41) |
| Acquisition costs | (371) | (241) |
| Administration costs | (346) | (349) |
| Other expenses | (166) | (129) |
| Total expenses | (3,159) | (1,981) |
| Loss before tax | (1,243) | (411) |
| Gain on disposal of discontinued operations | 56 | – |
| Loss after tax from discontinued operations | (1,187) | (411) |
The Income statement includes the transactions with GP Reinsurance EAD, Bulgaria – Income from ceded reinsurance commission and claims paid in amount of CZK 1,995 million (2014: CZK 1,000 million) and Expenses from ceded earned premium in amount of CZK 1,323 million (2014: CZK 1,061 million).
Effect of discontinued operations to other comprehensive income for the period to 31 December is the following:
| In CZK million | 2015 | 2014 |
|---|---|---|
| Other Comprehensive Income | ||
| Loss after tax from discontinued operations | (1,187) | (411) |
| Other comprehensive income – elements which may be recycled to profit or loss | – | – |
| Exchange rate differences in equity | 22 | 1 |
| Available-for-sale financial assets revaluation in equity | (26) | 30 |
| Available-for-sale financial assets revaluation realised in income statement | 3 | (1) |
| Other comprehensive income before tax effects | (1) | 30 |
| Tax on items of Other comprehensive income | – | (1) |
| Other comprehensive income/loss, net of tax | (1) | 29 |
| Total comprehensive income | (1,188) | (382) |
Cash flows from/(used in) discontinued operations for the period ended 31 December were the following:
| In CZK million | 2015 | 2014 |
|---|---|---|
| Net cash flows from/(used in) operating activities | (1,482) | 156 |
| Net cash flows from/(used in) investing activities | 1,265 | (575) |
| Net cash flows used in financing activities | (2) | (3) |
| Net cash decrease from discontinued operations | (219) | (422) |
The following table provides the amount of cash and cash equivalents and the amount of the assets and liabilities in the respect of losing control summarised by each major category.
| In CZK million | |
|---|---|
| Other intangible assets | 16 |
| Investments | 4,024 |
| Ceded insurance liabilities | 1,622 |
| Receivables | 214 |
| Cash and cash equivalents | 9 |
| Other assets | 34 |
| Assets | 5,919 |
| Insurance liabilities | 5,714 |
| Other provisions | 32 |
| Financial liabilities | 1 |
| Payables | 130 |
| Other liabilities | 45 |
| Liabilities | 5,922 |