Constance Hotels Services Limited | Annual Report 2025

191 ANNUAL REPORT 2025

Notes to the Financial Statements Year ended December 31, 2025

Notes to the Financial Statements Year ended December 31, 2025

8. INVESTMENTS IN SUBSIDIARY COMPANIES

8. INVESTMENTS IN SUBSIDIARY COMPANIES (CONT’D)

(e) At reporting date, the directors have assessed whether the recoverable amount is less than the carrying amount of investments and concluded that no impairment adjustments is required. (2024: Nil). The recoverable amount has been determined by calculating the value in use of each cash generating unit. The discount rate has been determined using a capital asset model to calculate a post-tax rate that reflects market assessment of the time value of money. The post-tax cash flow projection is based on financial budgets approved by management covering a five-year period. The post-tax discount rate applied represents the current market assessment of the risks specific to each CGU, taking into consideration the time value of money and individual risks of the underlying assets that have not been incorporated in the cash flow estimates. The discount rate calculation is based on the specific circumstances of the Group and its operating segments and is derived from its weighted average cost of capital (WACC) is 19% (2024: 15%) for the various entities of the Group. The WACC takes into account both debt and equity. The cost of equity is derived from the expected return on investment by the Group’s investors. The cost of debt is based on the interest bearing borrowings the Group is obliged to service. The growth rates are consistent with the industry in which each CGU operates. Management has determined the key assumptions as of 31 Dec 2025. The discount factor is consistent with external sources of information.

THE COMPANY 2025

2024

MUR’000

MUR’000

COST At January 1, and December 31,

4,191,003

4,191,003

(1,247,150) 2,943,853

Impairment

(1,247,150) 2,943,853

Investment in subsidiaries, net of impairment

The Company’s subsidiaries are as follows:

Proportion of ownership interest

Cost of invest ment

Country of incor poration

Discount Factor

Country of operation

Name of corporation

Direct

Indirect

Main business

Investee

2025 19% 19% 10%

2024

MUR’000 2025

2024 2025

2024

Constance Hotels International Services Limited

15% 15%

%

%

%

%

Constance Hotels Investment Limited Mourouk Ebony Hotels Limited

100 100

- - - - - - -

Constance Industries Limited Beauport Industries Limited White Sand Paradise Ltd (d) Constance Hotels International Services Limited

964,475 500,000 310,030 87,509

100 100

- - - - - - -

Mauritius Mauritius Mauritius Mauritius Mauritius Mauritius United Kingdom Mauritius Mauritius Maldives Maldives Mauritius Mauritius

Mauritius Hotel industry Mauritius Hotel industry Mauritius Hotel industry

9%

Should the discount factor increase by 1%, the recoverable amount will remain higher than the carrying amount for both Financial year 2025 and 2024 hence no impairment. The disclosure has been made for those investments in subsidiaries where there was an indication of impairment.

86

86

100

100

Mauritius Investment holding and Management company Mauritius Training centre Mauritius Investment holding

100 100 100

Constance Hospitality Training Centre Ltd Constance Hotels Investment Limited

37,024

100 100 100

1,741,933

9. INVESTMENTS IN ASSOCIATES

Hotels Constance (UK) Limited

1

United Kingdom

Marketing representative

(a) THE COMPANY

-

100

Ariatoll Services Ltd

-

-

100 Mauritius

Mauritius Management company Mauritius Management company Mauritius Management company Mauritius Hotel industry Maldives Hotel industry Mauritius Investment holding Mauritius Hotel industry

100

-

Constance Hospitality Management Limited

550,031

100

-

2025

2024

- - - - -

75

LRM Company Ltd (a)

- - - - -

- - - - -

75

MUR’000

MUR’000

100 100 100

Moofushi Development Ltd The Waterfront PVT Ltd Halaveli Development Ltd

100 100 100

Unquoted - cost At January 1,

342,687

344,687 (2,000) 342,687

-

Repayment of quasi-equity

60

Mourouk Ebony Management Ltd (c)

60

342,687

At December 31,

4,191,003

Analysed as follows: Equity Quasi-investments

(a) The proportion of ownership held by non controlling interest for LRM Company Ltd is 25% for the years 2025 and 2024.

290,000 52,687 342,687

290,000 52,687 342,687

(b) The shares held in the above subsidiaries are ordinary shares. The reporting date for all the above companies is December 31.

(c) The proportion of ownership held by non controlling interest for Mourouk Ebony Management Ltd for the year 2025 and 2024 is 40%.

Quasi-investments were accounted as part of ‘’investment in associates’’ and regarded as a receivable from associates for which settlement is neither planned nor likely to occur in the foreseeable future. The quasi-investments bear the same characteristics of an equity investments in the associates.

(d) The proportion of ownership held by non controlling interest for White Sand Paradise Ltd for the year 2025 and 2024 is 14%.