01 02 03 Financial Statements 04 19. Accounts payable Accounts payable comprise: 31 December 2018 31 December 2017 Accounts payable for healthcare materials and supplies 90,102 86,841 Payable for purchase of property and equipment 7,171 4,242 Accounts payable for office supplies 3,187 5,577 Accounts payable for healthcare services 252 4,563 Other accounts payable 4,380 4,740 Total accounts payable 105,092 105,963 20. Debt securities issued In July 2017 EVEX issued five-year term local bonds of GEL 90 million. The bonds were issued at par value with an annual coupon rate of 10.5% representing a 350 basis points premium over the National Bank of Georgia Monetary Policy (refinancing) Rate. The proceeds were used to refinance borrowings from local commercial banks, which are a relatively more expensive source of funding, and also to fund planned ongoing capital expenditures. Outstanding balance as of 31 December 2018 equalled GEL 93,573 (2017: GEL 93,493). 21. Payables for share acquisitions Payables for share acquisitions (also referred to as a “holdback” or an “acquisition holdback”) are stated at fair value and represent outstanding amounts payable for business combinations and acquisition of non-controlling interest in existing subsidiaries. Payables for business combination is a portion of the total consideration, payment of which is deferred for a specified period of time in the future and, usually, is contingent upon certain events or conditions precedent or covenants established by the buyer. These conditions are: (i) the audited total equity balance in accordance with IFRS should not be materially different compared to management accounts existing as at the date of deal; (ii) material unrecorded liabilities should not be identified; and (iii) any liabilities of the acquiree and/or its related parties towards the acquirer should not remain unpaid for greater than predetermined period after acquisition. Once these conditions precedent are fulfilled, the holdback amount is then paid fully or adjusted, as prescribed in the share purchase agreement for each particular business combination. Payable for share acquisitions comprised: 31 December 2018 31 December 2017 Holdback for the acquisition of JSC ABC Pharmacy 88,536 92,409 LLC Emergency Service 2,591 2,850 JSC Pediatry 347 347 JSC Policlinic Vere – 1,581 LLC Patgeo – 756 LLC Medical Center Almedi – 200 LLC New Clinic – 115 Total payables for share acquisitions 91,474 98,258 As at 31 December 2018, GEL 71,668 (2017: GEL 61,512) from JSC ABC holdback amount of GEL 88,536 (2017: GEL 92,409) represents redemption liability arising from put option held by minority shareholders of JSC GEPHA which can be exercised in 2022 in case of which the Group will have to acquire from non-controlling interests the remaining 33% shares based on pre-determined EBITDA multiple (4.5 times EBITDA). Payables for share acquisitions are measured at fair value: put option is measured at present value of the best estimate of ultimately payable amount; holdbacks for business acquisitions are measured at fair value, being the best estimate of price that would be paid to transfer a liability. During 2018 the Group paid GEL 12,948 from the JSC ABC holdback amount (2017: GEL 0). 22. Finance lease liabilities Finance lease liabilities comprises the minimum lease payments and repurchase option price, exercisable in up to one-year period from agreement start date, of two ambulatory clinics located in Georgia, one in Tbilisi and one in Batumi, western Georgia. As at 31 December 2018, net carrying value of properties held under finance lease equalled GEL 8,799 (2017: GEL 8,854). The undiscounted value of future minimum lease payments and repurchase option equalled GEL 8,780 (2017: GEL 9,048) (Note 39) while present value of these amounts equalled GEL 8,676 (2017: GEL 8,834). At the option expiration, the embedded purchase option in finance lease agreements is renewed automatically unless the counterparty comes up with new repurchase price within several days from the option expiration. All payments under finance lease contracts are due in no later than one year. 157