Annual Report • Apr 30, 2018
Annual Report
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Annual Financial Report According to article 4 of L. 3556/2007 for the financial year from January 1st, 2017 to December 31st, 2017 (amounts in € thousand unless otherwise mentioned)
MARFIN INVESTMENT GROUP HOLDINGS S.A. 67, Thisseos Avenue, 146 71 Kifissia, Greece Tel. +30 210 6893450
General Commercial Reg. Nr. 3467301000 (Societe Anonyme Reg. Nr. 16836/06/Β/88/06)
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| A. REPRESENTATIONS OF THE MEMBERS OF THE BOARD OF DIRECTORS 6 |
|---|
| Β. INDEPENDENT AUDITOR'S REPORT 7 |
| C. MANAGEMENT REPORT OF THE BOARD OF DIRECTORS OF "MARFIN INVESTMENT GROUP S.A." ON THE CONSOLIDATED AND CORPORATE FINANCIAL STATEMENTS FOR THE YEAR 2017 13 |
| D. ANNUAL SEPARATE AND CONSOLIDATED FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED AS AT 31ST OF DECEMBER 2017 95 |
| CONSOLIDATED INCOME STATEMENT FOR THE FINANCIAL YEAR 2017 96 |
| SEPARATE INCOME STATEMENT FOR THE FINANCIAL YEAR 2017 97 |
| CONSOLIDATED AND SEPARATE STATEMENT OF COMPREHENSIVE INCOME FOR THE FINANCIAL YEAR 2017 98 |
| STATEMENT OF FINANCIAL POSITION AS OF DECEMBER 31st 2017 99 |
| CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE FINANCIAL YEAR 2017 100 |
| CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE FINANCIAL YEAR 2016 101 |
| SEPARATE STATEMENT OF CHANGES IN EQUITY FOR THE FINANCIAL YEAR 2017 102 |
| SEPARATE STATEMENT OF CHANGES IN EQUITY FOR THE FINANCIAL YEAR 2016 102 |
| STATEMENT OF CASH FLOWS FOR THE FINANCIAL YEAR 2017 (CONSOLIDATED AND SEPARATE) . 103 |
| 1 GENERAL INFORMATION ON THE GROUP 105 |
| 2 GROUP STRUCTURE AND ACTIVITIES 106 |
| 3 BASIS OF FINANCIAL STATEMENTS PRESENTATION 115 |
| 4 SUMMARY OF SINGIFICANT ACCOUNTING POLICIES 124 |
| 5 SIGNIFICANT ACCOUNTING ESTIMATES AND MANAGEMENT ASSESSMENT 146 |
| 6 BUSINESS COMBINATIONS AND ACQUISITIONS OF NON-CONTROLLING INTERESTS 150 |
| 7 DISPOSAL GROUPS CLASSIFIED AS HELD FOR SALE AND DISCONTINUED OPERATIONS 153 |
| 8 OPERATING SEGMENTS 157 |
| 9 PROPERTY, PLANT AND EQUIPMENT 160 |
| 10 GOODWILL 162 |
| 11 INTANGIBLE ASSETS 166 |
| 12 INVESTMENTS IN SUBSIDIARIES 167 |
| 13 INVESTMENTS IN ASSOCIATES 169 |
| 14 INVESTMENT PORTFOLIO 171 |
| 15 INVESTMENT PROPERTY 171 |
| 16 OTHER NON-CURRENT ASSETS 172 |
| 17 DEFERRED TAX RECEIVABLES AND LIABILITIES 172 |
| 18 INVENTORIES 173 |
| 19 TRADE AND OTHER RECEIVABLES 174 |
| 20 OTHER CURRENT ASSETS 175 |
| 21 TRADING PORTFOLIO AND OTHER FINANCIAL INSTRUMENTS AT FAIR VALUE THROUGH PROFIT & LOSS 176 |
| 22 CASH, CASH EQUIVALENTS AND RESTRICTED CASH 176 |
| 23 SHARE CAPITAL AND SHARE PREMIUM 177 |
| 24 OTHER RESERVES AND FAIR VALUE RESERVES 177 |
| 25 EMPLOYEE RETIREMENT BENEFITS 178 |
| 26 GRANTS 181 |
| 27 BORROWINGS 181 |
| 28 CHANGES IN LIABILITIES FROM FINANCING ACTIVITIES 187 |
| 29 FINANCIAL DERIVATIVES 187 |
| 30 PROVISIONS 188 |
| 31 | OTHER LONG-TERM LIABILITIES 188 | |
|---|---|---|
| 32 | SUPPLIERS AND OTHER LIABILITIES 189 | |
| 33 | TAX PAYABLE 189 | |
| 34 | OTHER SHORT-TERM LIABILITIES 189 | |
| 35 | SALES 190 | |
| 36 | COST OF SALES – ADMINISTRATIVE – DISTRIBUTION EXPENSES 190 | |
| 37 | OTHER OPERATING INCOME 191 | |
| 38 | OTHER OPERATING EXPENSES 191 | |
| 39 | OTHER FINANCIAL RESULTS 192 | |
| 40 | FINANCIAL EXPENSES 193 | |
| 41 | FINANCIAL INCOME 193 | |
| 42 | PROFIT/(LOSS) FROM ASSOCIATES CONSOLIDATED UNDER THE EQUITY METHOD 194 | |
| 43 | INCOME TAX 194 | |
| 44 | MANAGEMENT REMUNERATION 195 | |
| 45 | EARNINGS PER SHARE 195 | |
| 46 | ANALYSIS OF TAX EFFECTS ON OTHER COMPREHENSIVE INCOME 196 | |
| 47 | RELATED PARTY TRANSACTIONS 197 | |
| 48 | CONTINGENT LIABILITIES 199 | |
| 49 | FAIR VALUE OF FINANCIAL INSTRUMENTS 207 | |
| 50 | RISK MANAGEMENT POLICIES 209 | |
| 51 | STATEMENT OF FINANCIAL POSITION POST REPORTING DATE EVENTS 215 | |
| 52 | APPROVAL OF FINANCIAL STATEMENTS 217 |
"EVEREST" refers to "EVEREST S.A." "GOODY'S" refers to "GOODY'S S.A." "MIG LEISURE" refers to "MIG LEISURE LTD" "MIG SHIPPING" refers to "MIG SHIPPING S.A." "OLYMPIC AIR" refers to "OLYMPIC AIR S.A." "DELTA" refers to " DELTA FOODS S.A." "MEVGAL" refers to "MEVGAL S.A." "CGU" refers to "Cash Generating Unit" "CBL" refers to "Convertible Bond Loan"
"Company", "Group", " MIG" refers to "MARFIN INVESTMENT GROUP HOLDINGS S.A." "ATTICA" refers to "ATTICA HOLDINGS S.A." "BLUE STAR" refers to "BLUE STAR MARITIME S.A." "BVI" refers to BRITISH VIRGIN ISLANDS "FORTRESS" refers to "FORTRESS INVESTMENT GROUP" "MARFIN CAPITAL" refers to "MARFIN CAPITAL S.A." "MIG AVIATION 1" refers to "MIG AVIATION 1 LTD" "MIG AVIATION 2" refers to "MIG AVIATION 2 LTD" "MIG AVIATION HOLDINGS" refers to "MIG AVIATION HOLDINGS LTD" "MIG LRE CROATIA" refers to "MIG LEISURE & REAL ESTATE CROATIA B.V." "MIG REAL ESTATE" refers to "MIG REAL ESTATE S.A." "MIG REAL ESTATE SERBIA" refers to "MIG REAL ESTATE (SERBIA) B.V." "ΑΤΗΕΝΙΑΝ ENGINEERING" refers to "ATHENIAN ENGINEERING S.A." former "OLYMPIC ENGINEERING S.A." "SKYSERV" refers to "SKYSERV HANDLING S.A." former "OLYMPIC HANDLING S.A." "RKB" refers to "JSC ROBNE KUCE BEOGRAD" "SINGULARLOGIC" refers to "SINGULARLOGIC S.A." "SUNCE" refers to "SUNCE KONCERN D.D. ZAGREB" "VIVARTIA" refers to "VIVARTIA HOLDINGS S.A." "EBL" refers to "Exchangeable Bond Loan" "ASP" refers to Available for Sale Portfolio "IFRS" refers to International Financial Reporting Standards "CTDC" refers to "THE CYPRUS TOURISM DEVELOPMENT PUBLIC COMPANY LTD" "MITERA" refers to "MITERA HOSPITAL S.A." "BARBA STATHIS" refers to "BARBA STATHIS S.A." "HYGEIA" refers to "HYGEIA S.A."
The below statements, made in compliance with Article 4, Par. 2 of the Law 3556/2007, as currently effective, are made by the following representatives of the Company Board of Directors:
The following Members who sign the financial statements, under our capacities as Members of the Board of Directors, specifically appointed for this purpose by the Board of Directors of MARFIN INVESTMENT GROUP HOLDINGS S.A. declare and certify to the best of our knowledge that:
Kifissia, April 30, 2018
The designees
| The Chairman of the BoD | The Chief Executive Officer | The Member of the BoD | ||
|---|---|---|---|---|
| Panagiotis Throuvalas | Athanasios Papanikolaou | Christophe Vivien | ||
| ID No: ΑΚ543083 | Passport No: ΑΝ4135328 | Passport No: 14AD07810 |
To the Shareholders of «MARFIN INVESTMENT GROUP HOLDINGS S.A.»
We have audited the accompanying separate and consolidated financial statements of MARFIN INVESTMENT GROUP HOLDINGS S.A. (the Company) and its subsidiaries, which comprise the separate and consolidated statements of financial position as at December 31 2017, and the separate and consolidated statements of profit or loss and other comprehensive income, statements of changes in equity and cash flow statements for the year then ended, including a summary of significant accounting policies and selected explanatory notes to the financial statements.
In our opinion, the accompanying separate and consolidated financial statements present fairly, in all material respects, the financial position of the Company and its subsidiaries as at December 31 2017, the financial performance and cash flows for the year then ended, in accordance with the International Financial Reporting Standards (IFRSs) as adopted by the European Union.
We conducted our audit in accordance with International Standards on Auditing (ISAs), as incorporated into the Greek Law. Our responsibilities, under those standards are further described in the "Auditor's Responsibilities for the Audit of the separate and consolidated Financial Statements" section of our report. We remained independent of the Company and its subsidiaries, during the whole period of our audit, in accordance with the International Ethics Standards Board for Accountants "Code of Ethics for Professional Accountants (IESBA Code) as incorporated in the Greek Law and we have fulfilled our ethical responsibilities in accordance with current legislation requirements and the aforementioned Code of Ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
We would like to draw your attention to Note 3.1 of the financial statements which describes that the Group's and Company's current liabilities exceed current assets by € 488.8 mil. and € 75.3 mil., respectively. As described in the same Note and in Note 27 of the financial statements, regarding the restructuring process of the Group subsidiaries' borrowing liabilities, Management has reached a Restructuring Agreement with financial institutions for existing borrowing liabilities of € 369.5 mil. and is in discussions for the restructuring of borrowing liabilities of € 162.4 mil. Furthermore, Management has signed a Restructuring Agreement which covers the majority of the Company's borrowing liabilities and requires compliance with financial covenants as well as the disposal of Group assets in order to substantially reduce the Company's total borrowings.
The above conditions indicate the existence of material uncertainty regarding the Group's and Company's ability to continue as a going concern. The successful finalization of the restructuring of borrowing liabilities constitutes a key requirement for the adequacy of the Group's and Company's working capital. As mentioned in the same Note, Management has planned actions to enhance the Group's and Company's financial position and the going concern assumption, condition which has been taken into account for the preparation of the accompanying financial statements according to the going concern principle. Our opinion is not modified in respect of this matter.
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the separate and consolidated financial statements of the current year. These matters and the related risks of material misstatement were addressed in the context of our audit of the separate and consolidated financial statements as a whole, and in forming our opinion thereon, and we do not express a separate opinion on these matters. Except of the
matter as described in the paragraph "Material Uncertainty Related to Going Concern" of our audit report, we have concluded that the matters which are described below are the key audit maters that must be disclosed in our audit report.
As at December 31, 2017, the Group has recognised goodwill of € 240.7 mil, intangible assets of € 425.2 mil. and tangible assets of € 1,065.2 mil. Further as at December 31, 2017 the Company has recognised investments in subsidiaries of € 1,096.6 mil.
In accordance with IFRS, management performs at the end of each reporting period, impairment tests for goodwill and intangible assets with indefinite useful life while for intangible assets with definite useful life, tangible assets and investments in subsidiaries impairment tests are performed only when relevant indications exist. The abovementioned assessment requires significant level of judgement.
The impairment test requires the identification of the recoverable amount of each Cash Generating Unit (CGU) as the higher of the fair value less costs to sell and value in use. The assessment requires judgement by management regarding the future cash flows of each CGU (relating to variables as revenue growth rate, capital and operating expenditures and the requirements of the relevant legal framework affecting their operation) and the discount rates applied to future cash flows.
Due to the importance of these financial statement items and management's use of assumptions and estimates, we consider the impairment assessment of the abovementioned financial statement items as one of the key audit matters.
The Group's and Company's disclosures relating to the accounting policy, judgements and estimates used for the impairment assessment of the abovementioned assets are included in notes 4.3, 5.2 (2), 5.2 (3), 5.2 (4) and 10 of the financial statements.
Our audit approach included, among others, the following procedures:
As at December 31, 2017, the Group and the Company are involved (under their capacity as defendant and plaintiff) in various and complex court cases and arbitration procedures during their normal operations.
Our audit approach included, among others, the following procedures:
We assessed Managements procedures regarding the collection, monitoring and
The recognition and measurement of provisions and the measurement and disclosure of contingent assets and liabilities related to court cases and arbitration procedures includes significant judgements by Management which take into consideration the estimates of its legal advisors and as a result we considered this area as one of the key audit matters. The estimates relate to the outcome and the possible financial impact of each case to the Group and the Company.
The Group's and Company's disclosures relating to the provisions and contingent liabilities are included in notes 4.18, 5.2 (16) and 48.3 of the financial statements.
assessment of pending court cases and respective provisions recognized.
As at December 31 2017, the Group has recognized investment properties of € 265.9 mil.
Investment properties are recognized initially at acquisition cost including any transaction costs and subsequently at fair value. The fair value assessment of investment properties which has been assigned by Group's Management to an independent appraiser is based on significant estimates relating among others to the range of market rentals, the rental adjustment factor and the discount rate.
Taking into consideration the abovementioned factors and the significance of this item to the Group's financial statements, we assessed the fair value measurement of investment properties as one of the key audit matters.
The Group's and Company's disclosures relating to the accounting policy, judgements and estimates used for the fair value measurement of investment properties are included in notes 4.8, 5.2 (12) and 15 of the Group's financial statements.
Our audit approach included, among others, the following procedures:
| Recoverability of trade receivables | |
|---|---|
| As at December 31 2017, the Group has recognized trade receivables of € 362.8 mil. against which provision for |
Our audit approach included, among others, the following procedures: |
| impairment amounting to € 142.5 mil. has been |
We evaluated management's procedures |
At each reporting date, management assesses the recoverability of the abovementioned Group's and Company's receivables in order to be reflected at their recoverable amount, a process which involves significant judgements and estimates. In this context and combined with the importance of this item in the financial statements, we assessed the recoverability of trade receivables as one of the key audit matters.
The Group's and Company's disclosures regarding the accounting policy, judgements, and estimates used for the recoverability assessment of trade receivables, are included in the notes 4.11, 5.2 (11) and 19 of the financial statements.
regarding the monitoring of trade receivables and the assessment of their recoverability.
Group's revenues are derived from different operating segments ("Food & Dairy", "Transportation", "Healthcare", "IT & Telecoms" and "Private Equity").
Each operating segment includes different revenue streams whose recognition involves different level of complexity and judgements by Management. Taking into consideration the above and the significance of this financial statement item we assessed revenue recognition as one of the key audit matters.
Group's disclosures regarding the accounting policies of revenue recognition and Management's judgements and estimates used for revenues are included in the notes 4.19 and 35 of the financial statements.
Our audit approach included, among others, the following procedures:
Management is responsible for the other information. The other information are included in the Management Report of the Board of Directors, for which reference is made in the "Report on Other Legal and Regulatory Requirements" and the Representations of the Members of the Board of Directors, does not include the financial statements and the auditor's report thereon.
Our opinion on the separate and consolidated financial statements do not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the separate and 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 separate and consolidated financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, we conclude, based on our audit, that there is a material misstatement therein, we are required to communicate that matter. We have nothing to report, regarding the aforementioned matter.
Management is responsible for the preparation and fair presentation of the separate and consolidated financial statements in accordance with the IFRSs as adopted by the European Union and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the separate and consolidated financial statements, management is responsible for assessing the Company's and 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 there is an intention to liquidate the Company or the Group or to cease operations, or there is no realistic alternative but to do so.
The Audit Committee (artic. 44 Law 4449/2017) of the Company is responsible for overseeing the Company's financial reporting process.
Our objectives are to obtain reasonable assurance about whether the separate and 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, as incorporated into the Greek Law, 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 financial statements.
As part of an audit in accordance with ISAs, as incorporated into the Greek Law, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
Taking into consideration that Management is responsible for the preparation of the Management Report of the Board of Directors for the year ended 31 December 2017, according to the provisions of paragraph 5 of article 2 of Law 4336/2015 (part B) we note the following:
Our audit opinion on the accompanying separate and consolidated financial statements is consistent with the complementary report to the Company's Audit Committee in accordance with Article 11 of the European Union (EU) Regulation 537/2014.
We have not provided the prohibited non-audit services referred to in Article 5 of EU Regulation 537/2014.
The permitted non-audit services that we have provided to the Company and its subsidiaries during the financial year that ended 31st December 2017, are disclosed in note 36 of the accompanying separate and consolidated financial statements.
We have been appointed statutory auditors by the Annual General Meeting of the Company on 29/06/2004. Since, we have been appointed as the statutory auditors for a total period of 14 years based on the decisions of the shareholder's Annual General Meetings.
Athens,30th April 2018
Certified Accountants (C.A.)
Manolis Michalios Dimitra Pagoni
I.C.P.A. Reg. No.: 25131 I.C.P.A. Reg. No.: 30821
The current Annual Report of the Board of Directors pertains to the annual period which ended on 31/12/2017. The Report has been prepared by the Board of Directors in compliance with the relevant provisions of the CL 2190/1920 as effective, the law 3556/2007 (Government Gazette 91Α/30.04.2007) as well as the executives resolution of the BoD of the Hellenic Capital Market Commission.
The current report briefly describes the financial information for the year 2017, the most significant events that took place (before and after the Financial Statements reporting date) and the prospects regarding the company MARFIN INVESTMENT GROUP HOLDINGS S.A. (hereinafter "MIG", "The Company") as well as its subsidiaries. Moreover, it provides a description of the main risks and uncertainties the Group and the Company might be facing within 2018 as well as the most significant transactions that took place between the issuer and its related parties.
Sales: Sales from continuing operations amounted to € 1,079.9 m remaining at the same level as sales standing at € 1,082.0 m recorded last year. Among all of the Group's operating segments, not including intercompany transactions, the Transportation segment recorded an increase of 1.0%. Sales of the Healthcare segment remained stable versus 2016, while the Food and Dairy and Transportation segments recorded a decrease in sales by (1.2%) and the IT and Telecommunications segment by (3.4%).
EBITDA from continuing operations: EBITDA from continuing operations stood at profit of € 117.8 m versus € 132.2 m last year recording a decrease of approximately (10.9)%. The decrease is mainly due to the decline in EBITDA of SINGULARLOGIC by € (9.3) m and ATTICA group by € (19.7) m due to the increase in fuel prices. In contrast, EBITDA of VIVARTIA group increased by € 10.3 m and of HYGEIA by € 3.1 m.
Financial Income and Expenses: Financial income from continuing operations stood € 0.4 m versus € 0.5 m last year. Financial expenses stood at € (98.7) m versus € (107.5) m in 2016 recording a decrease of (8.2%). Other financial results of the Group stood at € 1.7 m versus € (25.0) m last year. The above item in 2017 includes impairment loss of assets amounting to € (4.0) m out of which an amount of € (1.4) m pertains to VIVARTIA group and € (2.7) m SINGULARLOGIC group. Moreover, the item includes profit from reversal of impairment of ATTICA group vessels amounting to € 5.3 m. It is noted that the previous year results were burdened with impairment losses of assets amounting to a total of € (36.7) m of which an amount of € (21.3) m pertained to VIVARTIA group, € (14.9) m to KETA, and € (0.5) m to HYGEIA group, while the item other financial income and expenses includes profit from reversal of impairment of assets amounting to € 17.5 m of which an amount of € 5.9 m pertains to VIVARTIA group, and € 11.6 m to ATTICA group. The earnings from associates stood at € (6.5) m versus € (1.7) m in the respective last year period. The earnings in question refer to an associate of ATTICA group € (7.5) m and associates of VIVARTIA group € 1.0 m.
Income Tax: Income tax from continuing operations stood at € (2.0) m versus € 3.0 m last year.
Profit/(Loss) from Continuing Operations: Consolidated loss after tax from continuing operations in 2017 stood at € (64.3) m versus loss of € (75.0) m recorded last period.
Profit/(Loss) from Discontinued Operations: In 2017, losses from discontinued operations stood at € (11.7) m and pertained to the results of the discontinued operations of HYGEIA group. It is to be noted that in the respective last year period, the results of discontinued operations presented losses of € (7.8) m and included the results of SUNCE as well as discontinued operations of HYGEIA group.
Profit/(Loss) from Continuing and Discontinued Operations: Total losses stood at € (76.0) m versus € (82.8) m in the respective period last year. In 2017, total losses attributable to the owners of the Parent company pertain to an amount of € (74.8) m, while losses attributable to minorities pertain to an amount of € (1.2) m.
Cash, Cash Equivalent & Restricted Cash and Debt: The Group's cash, cash equivalents & restricted cash on 31/12/2017 stood at € 130.5 m and is analyzed as follows: Food and Dairy € 59.9 m (45.9% of the total), Transportation € 44.6 m (34.2% of the total), Healthcare € 11.1 m (8.5% of the total), IT and Telecoms € 1.8 m (1.4% of the total), Private Equity € 3.4 m (2.6% of the total) and Financial Services € 9.6 m (7.4% of the total).
The Group's total debt on 31/12/2017 stood at € 1,624.3 m decreased by € (50.2) m versus 31/12/2016 and is analyzed as follows: Food and Dairy € 394.0 m (24.3% of the total), Transportation € 238.7 m (14.7% of the total), Healthcare € 131.6 m (8.1% of the total), IT and Telecoms € 56.8 m (3.5% of the total), Private Equity € 104.6 m (6.4% of the total) and Financial Services € 698.6 m (43.0% of the total).
Net Cash Flows from Operating Activities: Net cash flows from operating activities stood at € 15.9 m versus € 32.2 m in the corresponding period last year.
Cash Flows from Investing Activities: Cash flows from investing activities stood at € 19.9 m versus € (31.2) m last year. The difference is due to inflows from the deposal of the associate company SUNCE within the 1st six-month period of 2017.
Cash Flows from Financing Activities: Cash flows from financing activities stood at € (48.0) m remaining flat versus € (35.5) m in the respective period last year.
The sales of this segment in 2017 stood at € 565.2 m (€ 5.3 m of which were intragroup) a decrease of 1.2% compared to € 572.0 m in the respective period last year (€ 5.4 m of which were intragroup). The sales of the segment are analyzed as follows: Dairy: € 265.7 m, Frozen Food: € 141.6 m and Catering and Entertainment: € 164.1 m (including intragroup sales of € 6.1 m).
EBITDA stood at € 56.4 m, versus € 46.2 m in the respective period last year. It is noted that ΕΒΙTDA for 2016 was burdened with an amount of € (13.8) m arising from impairment on the balances of receivables from Marinopoulos group in the context of the resolution agreement with the aforementioned group. Operating segment EBITDA is analyzed as follows: Dairy: € 20.1 m, Frozen Food: € 24.5 m and Catering and Entertainment: € 12.5 m.
Profit before tax stood at € 0.9 m versus losses of € (27.0) m in the respective period in 2016, recording profit before tax for the first time after 2009.
Loss after tax stood at € (1.5) m versus losses of € (24.2) m in the respective period in 2016.
The sales of the transportation operating segment in 2017 stood at € 271.6 m (€ 10.7 m of which were intragroup) posting an increase of 1.1% versus € 268.7 m (€ 10.4 m of which were intragroup) in the respective period last year.
EBITDA stood at € 50.3 m versus € 69.8 m in the respective period last year. The decrease is mainly due to the significant rise in fuel prices which burdened ATTICA group with € 22 m comparing to 2016.
Profit after tax stood at € 1.9 m versus profit after tax of € 29.0 m last year.
The sales of the Healthcare operating segment stood at € 206.0 m remaining at the same level as last year versus € 205.9 m recorded in 2016.
EBITDA stood at € 33.5 m, increased by € 3.0 m versus the respective period last year, when it stood at € 30.5 m.
Profit after tax increased by € 5.5 m and stood at € 9.3 m versus € 3.8 m in the comparative period.
The sales of the operating segment for 2017 stood at € 37.5 m (€ 3.2 m of which intragroup) – recording a decrease of (4.3)% versus € 39.2 m (€ 3.6 m of which intragroup) in the respective period of 2016.
EBITDA recorded losses of € (4.8) m versus profit of € 4.6 m recorded last year. The decrease in operating profit is was mainly due to time delays in the implementation of major private and public sector IT projects that SINGULARLOGIC group is interested in.
Loss after tax stood at € (13.8) m versus loss of € (4.1) m in the respective period last year.
The sales of the operating segment in 2017 stood at € 24.7 m (€ 5.9 m of which intragroup) versus € 23.5 m for the respective period last year (€ 7.8 m of which intragroup), increased by 5.0%.
EBITDA recorded losses of € (5.1) m versus losses of € (1.9) m for the respective period last year. The Income Statement for 2017 was burdened with revaluation loss from RKB's investment property of € (10.9) m versus loss of € (7.3) m recorded in 2016.
Loss after tax stood at € (11.7) m versus € (23.6) m for the respective period last year.
Loss after tax for 2017 stood at € (48.7) m versus losses of € (56.0) m in the respective period last year and mainly pertained to financial expenses of MIG parent company.
Net Assets Value (NAV) of MIG as at 31/12/2017 stood at € 574.1 m or € 0.61 per share versus € 0.71 per share as at 31/12/2016 (13.8%).
In the context of implementing the Guidelines on Alternative Performance Measures of the European Securities and Markets Authority (ESMA/2015/1415el) effective as from July 3rd 2016 in respect of Alternative Performance Measures (APMs)
The Group uses Alternative Performance Measures (APMs) in the context of decision making regarding financial, operational and strategic planning as well as while evaluating and recording its performance. APMs facilitate better understanding of financial and operating results of the Group and its financial position. APMs should always be taken into account in conjunction with the financial results recorded under IFRSs and should under no circumstances replace them.
EBITDA (Earnings Before Interest Taxes Depreciation & Amortization): The ratio adds total depreciation of tangible assets and amortization of intangible assets to consolidated earnings before taxes. The higher the ratio, the more efficiently the entity operates.
EBITDA Margin (%): EBITDA Margin (%) divides the basic earnings before interest, taxes, depreciation, and amortization by the total turnover.
EBITDA (Earnings Before Interest Taxes Depreciation & Amortization) for total subsidiaries – The ratio adds to consolidated earnings before taxes and interest, total depreciation of tangible assets and amortization of intangible assets apart from holding companies, provisions other than those pertaining to the ordinary course of business, gain/losses arising from disposal of investment property, tangible and intangible assets and fair value adjustments to investment property.
EBITDA Margin (%) for total subsidiaries: EBITDA Margin (%) divides EBITDA for total subsidiaries by the total turnover.
EBIT (Earnings Before Interest & Taxes) for total subsidiaries: EBIT calculated as EBITDA less subsidiaries depreciation of tangible assets and amortization of intangible assets.
EBIT Margin (%) for total subsidiaries: EBIT Margin divides EBIT for total subsidiaries by the total turnover.
| 31/12/2017 Amounts in € m |
Food & Dairy |
Healthcare | Financial Services |
IT & Telecoms |
Transportation | Private Equity |
Total from continuing operations |
|---|---|---|---|---|---|---|---|
| Revenues (a) | 559.9 | 206.0 | - | 34.4 | 260.9 | 18.8 | 1,079.9 |
| Operating profit/(loss) -ΕΒΙΤ | 26.4 | 18.6 | (13.2) | (8.2) | 23.8 | (6.6) | 40.8 |
| Depreciation | 30.0 | 14.9 | 0.4 | 3.4 | 26.4 | 1.8 | 76.9 |
| Earnings before interest, taxes, depreciation and amortization - EBITDA (b) |
56.4 | 33.5 | (12.8) | (4.8) | 50.3 | (4.8) | 117.8 |
| EBITDA margin (%) [(b)/(a)] |
10.1% | 16.3% | - | -13.8% | 19.3% | -25.5% | 10.9% |
| ΕΒΙΤDA of Holding companies |
- | - | 12.8 | - | - | - | 12.8 |
| Profit/(Loss) on sale of investment property, property, plant and equipment and intangible assets |
(0.2) | 0.0 | - | 0.2 | - | 0.0 | 0.1 |
| Fair value adjustment of investment property |
- | - | - | - | - | 10.9 | 10.9 |
| EBITDA business operations (c) |
56.2 | 33.5 | - | (4.5) | 50.3 | 6.2 | 141.6 |
| EBITDA business opeations margin (%) [(c)/(a)] |
10.0% | 16.3% | - | -13.1% | 19.3% | 32.7% | 13.1% |
| Depreciation of subsidiries | (30.0) | (14.9) | - | (3.4) | (26.4) | (1.8) | (76.6) |
| EBIT business operations (d) | 26.2 | 18.6 | - | (8.0) | 23.8 | 4.4 | 65.0 |
| EBIT business operations margin (%) [(d)/(a)] |
4.7% | 9.0% | - | -23.1% | 9.1% | 23.2% | 6.0% |
| 31/12/2016 Amounts in € m |
Food & Dairy |
Healthcare | Financial Services |
IT & Telecoms |
Transportation | Private Equity |
Total from continuing operations |
|---|---|---|---|---|---|---|---|
| Revenues (a) | 566.5 | 205.9 | - | 35.6 | 258.3 | 15.8 | 1,082.0 |
| Operating profit/(loss) -ΕΒΙΤ | 15.4 | 15.0 | (17.4) | 1.0 | 45.5 | (3.8) | 55.7 |
| Depreciation | 30.8 | 15.5 | 0.4 | 3.6 | 24.4 | 1.8 | 76.5 |
| Earnings before interest, taxes, depreciation and amortization - EBITDA (b) |
46.2 | 30.5 | (17.0) | 4.6 | 69.9 | (1.9) | 132.2 |
|---|---|---|---|---|---|---|---|
| EBITDA margin (%) [(b)/(a)] |
8.1% | 14.8% | - | 12.9% | 27.0% | -12.3% | 12.2% |
| ΕΒΙΤDA of Holding companies |
- | - | 17.0 | - | - | - | 17.0 |
| Provisions beyond normal business activity |
13.8 | - | - | 0.8 | - | - | 14.6 |
| Profit/(Loss) on sale of investment property, property, plant and equipment and intangible assets |
(0.4) | 0.0 | - | 0.0 | - | (0.0) | (0.4) |
| Fair value adjustment of investment property |
- | - | - | - | - | 7.3 | 7.3 |
| EBITDA business operations (c) |
59.5 | 30.5 | - | 5.4 | 69.9 | 5.3 | 170.6 |
| EBITDA business opeations margin (%) [(c)/(a)] |
10.5% | 14.8% | - | 15.3% | 27.0% | 33.6% | 15.8% |
| Depreciation of subsidiries | (30.8) | (15.5) | (3.6) | (24.4) | (1.8) | (76.1) | |
| EBIT business operations (d) | 28.8 | 15.0 | - | 1.8 | 45.5 | 3.5 | 94.6 |
| EBIT business operations margin (%) [(d)/(a)] |
5.1% | 7.3% | - | 5.1% | 17.6% | 21.9% | 8.7% |
MIG Net Asset Value (NAV): Value as at the reporting period date of total Equity divided by the number of shares.
| MIG Net Asset Value per share | 31/12/2017 | 31/12/2016 |
|---|---|---|
| Shareholders Equity (in €' 000) | 574,062 | 666,095 |
| Number of MIG shares | 939,510,748 | 939,510,748 |
| Net Asset Value (NAV) of MIG per share | 0.61 | 0.71 |
At the meeting of 23/10/2017 the Company's Board of Directors decided the election of Panagiotis Throuvalas as Non-Executive Member, to replace a member of the Board of Directors.
As at 26th of October 2017 ATTICA announces that it has reached agreement with MINOAN LINES S.A. (MINOAN LINES) for: (i) the acquisition (hereafter the "Acquisition") by ATTICA group of 37,667,504 shares in HELLENIC SEAWAYS MARITIME S.A. (hereafter HSW), representing 48.53% of the share capital of HSW, for a cash consideration of € 78.5 m; (ii) the sale of SUPERFAST XII vessel to a member company of the GRIMALDI group for a cash consideration of € 74.5 m; and (iii) the sale of Highspeed 7 vessel to MINOAN LINES for a cash consideration of € 25 m, after completion of the Acquisition and after all corporate and other approvals have been obtained. Completion of the agreement with MINOAN LINES is subject to customary conditions precedent, including the receipt of approvals from the competent authorities, as required. Upon completion of the Acquisition and the acquisition of a 50.30% equity stake in HSW as per ATTICA group's announcement dated 11 August 2017, ATTICA group will hold in aggregate an equity stake of 98.83% in HSW.
a) It was briefed on the submitted public proposal for acquisition of 30% of the company's shares by GEORGIOS APOSTOLOPOULOS HOLDINS S.A.
b) It decided to appoint an independent financial consultant, in accordance with Article 15(2), Law 3461/2006, who shall prepare valuation report on fair value of the Company's shares. The consultant shall, afterwards, inform the investing public about the content of the report and his/her opinion on the public offering.
c) It was briefed on the announcement issued on 24/11/2017 by MIG – HYGEIA's majority shareholder, which has a 70.38% stake in the company and exclusive control of HYGEIA – whereby MIG is not willing to proceed with the sale of any shares. The BoD members also announced that they are not willing to proceed with the sale of any shares. In all events, HYGEIA Board of Directors urges the investing public to study HYGEIA's financials, with the assistance of special advisors if necessary, so that they could form their own opinion as to the content of the submitted public offering. As at the 21st of December 2017 the Board of Directors of HYGEIA held a meeting in order to formulate its reasoned opinion with regard to the voluntary tender offer of GEORGIOS APOSTOLOPOULOS HOLDINS S.A. and keeping in mind: (a) the consideration offered, (b) the Financial Consultant's report, (c) the stock price of the company's share, (d) the business objectives of the Offeror in accordance with the Information Memorandum (e) the core strategic directions of HYGEIA group, the potential impact on employment and (g) the current shareholder structure of the company and the intentions of the existing shareholders, formulated the following Reasoned Opinion:
Finally, on February 23rd 2018, HYGEIA announced to the investing public that GEORGIOS APOSTOLOPOULOS HOLDINGS S.A. after the stock market closing on February 22nd 2018 holds a total number of 15,840,022 voting rights, which correspond to 5.181% of the share capital of the Issuer.
Amendment to the repayment schedule for the existing unpaid capital to semi-annual installments, d) Compliance with financial covenants at each financial result reporting period (semi-annual and annual). Usual forms of collateral for this type of loan were used to secure the program.
On June 15, 2017, the Annual General Meeting took place, and among others approved the election of Mr. Christophe Vivien as a new Member of the Board of Directors in filling a vacant position and of Messrs. Stefanos Capsaskis and Petros Katsoulas as Independent Non-Executive Members of the Board of Directors in replacement of Members who resigned. Furthermore, Mr. Emmanouil Xanthakis was appointed as Independent Member of the Board of Directors and of the Audit Committee under Article 4, Law 3016/2002.
On July 10, 2017, the 2nd Reiterative Annual General Meeting of Shareholders was held and it was resolved that a new Convertible Bond Loan be issued (hereinafter referred to as the "CBL") according to current legislation, in the amount of € 460,302,000 through a private placement and abolition of the pre-emption right of existing shareholders, through issuance of up to 1,534,340,000 bonds of a nominal value of € 0.30 each, convertible into Company's shares, for the purpose of repaying the Company's borrowing obligations. The term of the CBL shall be four years and will involve an early repayment right of the Company on each monthly anniversary throughout the term of the CBL, especially in case that the conversion right is exercised. The CBL interest-rate shall be 12-month EURIBOR plus 4% spread, with the option to recapitalize part of any interest due. Bondholders may ask for conversion of their bonds into shares of the Company for the first time 12 months following the issuance date of the CBL and, subsequently, at every monthly anniversary throughout the term of the CBL, upon written notice to the Company (hereinafter referred to as the "Conversion Notice Day"). In such case, the Company shall have an early repayment right in respect of the entire number (and not part of) the bonds for which the conversion right is exercised, within 15 working days starting from the day following the Conversion Notice Day. If the time-limit in question expires without any action, said bonds will be converted on the 20th working day after the Conversion Notice Day (hereinafter referred to as the "Conversion Day"). The conversion price will be equal to the stock market price on the day prior to the Conversion Notice Day. If, on the day prior to the Conversion Notice Day, the stock market price of the share is lower than its nominal value (€ 0.30), the Company, upon bondholders' request will proceed to all appropriate corporate actions, including reducing the number of shares (reverse split) and at the same time reducing the share capital, by reducing the nominal value of each share for the purpose of writing off loss, in order to cause a readjustment of the stock market price to at least (€ 0.30), which shall then constitute the conversion price. In such case, the Conversion Day will be subsequent to the completion of the relevant corporate actions. The CBL may be secured by collateral on listed and unlisted shares owned by the Company.
Chatzigiannis, who was appointed as an Independent Non-Executive Member, as it meets the criteria of article 4 of Law 3016/2002. Therefore, the Board of Directors of the Company is as follows:
On March 1st 2018, a Restructuring Agreement for VIVARTIA's group debt was signed between the group and its lenders, i.e. ALPHA BANK S.A., EUROBANK ERGASIAS S.A., NATIONAL BANK OF GREECE S.A. and PIRAEUS BANK S.A. The Restructuring Agreement incorporates beneficial terms for the group, such as significant financial cost reduction and maturity extension for VIVARTIA's group Bond Loans up to October 2024. The completion of the Restructuring Agreement is under progress and it is expected to be finalized within May 2018 through the signing of the new bond loan agreements.
On March 28th 2018, ATTICA group announced its triple accolade at the 2018 Tourism Awards organized by Boussias Communications.
At the awards ceremony, which was held at the Hellenic Cosmos cultural centre, ATTICA group received:
Following the approval, ATTICA will proceed immediately to the completion of the required contractual actions for the acquisition of 98.83% of the share capital of HELLENIC SEAWAYS S.A.
Chairman and Chief Executive Officer), Georgios Efstratiadis (Member), Christophe Henri Vivien (Member), Anastasios Kyprianidis (Member) and Kapsasis Stephanos (Member).
In April 2018 was successfully completed the certification requirements of SINGULARLOGIC for the International Standard ISO 20000-1: 2011 for the Management of its Information Technology Services.
Greece's macroeconomic and financial environment continues to be challenging for Greek businesses with the rebuilding of the productive model and the restoration of smooth market operations being key prerequisites for the growth of the economy. Within this environment in 2017, MIG reached an agreement for the restructuring of loan liabilities, whereby it issued a convertible bond loan of € 425.2 m. The proceeds were used to refinance other existing loan obligations. At the same time, in the context of the implementation of this restructuring agreement, the Company completed the sale of its shareholding in SUNCE during the first half of 2017 and is in the process of implementing the other terms and conditions, including the disposal of Group assets, a process that should be completed in the period 2018-2019. Also, during 2017, the restructuring of the bank lending of HYGEIA and MITERA hospitals was completed while VIVARTIA's bank loan restructuring agreement, is in the final phase of implementation, with a predetermined completion date in July 2018. The above actions are added to a set of initiatives aimed at improving the efficiency and functionality of MIG Group.
For 2018, the Group's primary objective is to strengthen its subsidiaries by expanding their business activities, improving their financial results and successfully completing their debt restructuring. The main goal is to increase market share in the areas where it operates, to create new innovative products and to provide continuously improved and quality upgraded services. At parent level, the main challenge for the coming years remains the substantial decline in its high borrowing.
In the last few years, the Group has entered into a dynamic disinvestment program that has delivered significant resources to meet its obligations. For the years 2018 and going forward, the Group's Management expects a gradual improvement in markets in general and the financial markets in particular.
Based on the above priorities, each of the Group's operating segments has set the main objectives for 2018, as discussed below in this section.
For 2018, VIVARTIA Group's strategy aims to further enhance its profitability through undertaking new product initiatives and innovations, investing in the high quality of its products. At the same time, in the framework of its strategic plan implementation, VIVARTIA group, will continue its efforts to further strengthen its presence in the international markets as well as facilitate its penetration into new markets and distribution channels.
VIVARTIA group's management recognizes that the challenges are numerous and significant, as the group's companies are facing increased risks and adverse conditions. In this context, the group prepares and develops its plans in order to overcome the difficulties and address potentially arising issues. The main objective is to improve the financial position of the group's key subsidiaries, developing their business activities and proceeding with successful restructuring of their borrowings. The objective is to increase the market share in the segments, where the group operates, generate new, innovative products and offer continuously improved and quality upgraded services.
The key factors that will affect the course and development of ATTICA group turnover in 2018 have to do, amongst others, with the condition of the Greek economy, the degree of influence on domestic tourism traffic as a result of continuous decline of available income and changes in fuel prices. Furthermore, taking into account the seasonal nature of the segment's operations during the summer months, especially in respect of passengers and vehicles, as well as the fact that the development of international oil prices is an unpredictable factor, it is deemed rather risky to proceed with any projections. The group management continuously assesses the aforementioned factors and plans to optimize the group's performance on the basis of the arising data.
The focal point for the healthcare segment, in which HYGEIA group operates, is reorganization and financial support of EOPYY in order to define the legal framework for implementation of the new cooperation between EOPYY and the private clinics, while simultaneously providing a binding timetable for repayment of the accumulated amounts due to private healthcare services providers.
HYGEIA group's management monitors the developments and uses its experience, acquired through successful management of the prolonged crisis in recent years, assesses the existing conditions, making estimates and continuously assessing future investment and operational needs. The Management immediately adapts, where necessary, its business planning in order to maintain and increase operational efficiency of the group companies, reduce operating costs, expand its clientele and maximize intragroup synergies.
At the same time, the group monitors the current conditions experienced by the Greek economy and assesses value recoverability of its tangible and intangible assets based on the foreseeable short and long-term market conditions and the course of implementation of the approved business plans of the Management.
Furthermore, HYGEIA goes on operating bearing in mind long-term interests of its stakeholders, focusing on creating added value services, investing in cutting edge technology, making innovative services available to niche markets, always focusing on rendering high quality healthcare services, paying due respect to people, society and environment.
The Greek Information Technology Market is expected to improve in 2018, following the negative performance recorded during the three-year period 2015-2017. In 2017, IT market in Greece recorded a marginal decrease of 0.3%, while for 2018 it is expected to grow by 1.6%, with the value standing at € 1.7 billion. Services and software will continue to be regarded as the key factors in the growth of the IT market, while the equipment is expected to record lower performance.
In the context of operational restructuring of the company aiming towards return to profitability, the management has started the redesign of all operations, both in terms of organizational structure and product base, as they have been structured in recent following various mergers and acquisitions performed in the segment.
The company's involvement in the domains of integrator and software constitutes its comparative advantage over the competitors, since it provides the company with growth opportunities in various
markets and segments of the Greek economy, allowing it to make the best possible use of its human resources and technological advances.
RKB seeks to improve its financial performance by increasing occupancy and rental rates of its retail stores, while also is targeting high-quality international tenants and investors that plan to expand in the Serbian market. In this context, RKB is conducting active asset management of its available for rent and / or sale sites that includes improved leasing tactics, vacant space management, promotional and marketing initiatives as well as new revised procedures to enhance operational efficiency. The objective is to create a stable and strong customer base, increase occupancy, improve efficiency, and financial structure, and develop its operations on an on-going basis.
The consolidated and the separate Financial Statements of 31/12/2017 of the Company are prepared on a going concern basis, taking into account note 3.1 of the Financial Statements.
Τhe Company and the Group are exposed to risks pertaining to financing, interest rates, fuel prices, liquidity, credit and currencies. The Group reviews and periodically assesses its exposure to the risks cited above on a one by one basis as well as collectively and uses financial instruments to hedge its exposure to certain risk categories.
Evaluation and assessment of the risks faced by the Company and the Group are conducted by the Management and the Board of Directors of the Company. The main objective is to evaluate and assess all the risks to which the Company and Group are exposed to through their operating and investing activities.
The Group uses several financial instruments or pursues specialized strategies to limit its exposure to potential changes in the value of its investments stemming from market volatility, including fluctuations in prevailing interest rates and currency exchange rates.
The Group operates on an international scale and therefore is exposed to currency risk that arises mainly from fluctuations of the USD, UK Sterling, Albanian Lek, Bulgarian Lev, Romanian Ron and other currencies of European countries against the EUR exchange rate. This type of risk mainly arises from the commercial activities and the foreign currency transactions as well as investments in foreign legal entities. It is noted that the Company's and the Group's largest portion of revenues and expenses is Euro denominated. Likewise, the largest part of the Company's investments is denominated in Euro.
On 31/12/2017, out of the Group's total assets and liabilities € 39.5 m and € 14.9 m respectively were held in foreign currency. A change in exchange rates by +/-10% would result in an amount of € +/- € 0.1 m being recognized before tax in the income statement and an amount of € -/+ € 1.9 m being recognized in equity.
Changes in interest rates can affect the Group's net income by increasing the costs of servicing debt used to finance the Group. Changes in the interest rates can also affect, amongst others: (a) the cost
and availability of debt financing and the Company's ability to achieve attractive rates of return on its investments; and (b) the debt financing capability of the investments and of the businesses in which the Group is invested.
Bank debt constitutes one of the funding sources of the Group. A large portion of the Group's bank debt pays floating interest rates and therefore is directly dependent upon interest rate levels and fluctuations, a fact which exposes the Group to cash flow risk. The Group's floating rates are converted into fixed rates through hedging instruments which are in turn offset to a significant degree by bank deposits. The Group's policy is to constantly monitor interest rate trends as well as the duration of its financial needs. Thus, decisions about the length along with the relationship between fixed and floating rate of a new loan, are taken separately for each case.
On 31/12/2017, assets and liabilities amounting to € 130.5 m and € 1,624.3 m respectively for the Group and the Company, were exposed to interest rate risk. A change of interest rates by +/- 1% would result in -/+ € 17.0 m being recognized in the Consolidated Income Statement and Equity.
The risk of the Group and the Company with respect to the trading portfolio, financial instruments at fair value through profit or loss, the investment portfolio and investments in associates arises from potential adverse changes in the market prices of shares and other securities. On 31/12/2017, the assets exposed to market risk amounted to € 5.0 m for the Group and € 0.4 m for the Company respectively. A fluctuation of +/- 30% in investments whose revaluation gains or losses are recognized in the Income Statement and cumulatively in Equity, would lead to a change of +/- € 0.2 m for the Group and +/- € 0.1 m for the Company.
The Group's companies that operate in the Transportation Segment are significantly affected by the fluctuation of fuel prices, since it constitutes one of its main operating costs. An annual change of +/- 10% would affect the Income Statement of the Group and its equity by approximately -/+ € 8.3 m.
Credit risk is the risk of the potential delayed payment to the Group and the Company of its current and future receivables by its counterparties.
Aiming at minimizing credit risk and bad debts, the Group has adopted efficient processes and policies in relation to exposure limits per counterparty based on the counterparty's credibility.
Prudent liquidity risk management implies cash adequacy as well as the existence and availability of necessary funding sources. The Group is managing its liquidity requirements on a daily basis through systematic monitoring οf it's short and long-term financial liabilities and through daily monitoring of the payments made. Furthermore, the Group constantly monitors the maturity of its receivables and payables, in order to maintain a balance between capital continuity and flexibility via its bank credit worthiness.
Maturity of financial liabilities as at 31/12/2017 and 31/12/2016 for the Group and the Company is analyzed as follows:
| THE GROUP | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | ||||||||
| Amounts in € '000 | Short-term | Long-term | Short-term | Long-term | |||||
| Within 6 months |
6 to 12 months |
1 to 5 years |
More than 5 years |
Within 6 months |
6 to 12 months |
1 to 5 years |
More than 5 years |
||
| Long-term borrowing | 98,608 | 120,976 | 964,417 | 13,872 | 60,162 | 193,897 | 807,636 | 44,403 | |
| Liabilities relating to operating lease agreements |
725 | 760 | 2,604 | - | 657 | 689 | 3,948 | - | |
| Trade payables | 165,608 | 4,540 | - | - | 172,589 | 8,019 | - | - | |
| Other short-term-long-term liabilities |
164,482 | 11,117 | 6,045 | 400 | 148,334 | 16,118 | 11,359 | 400 | |
| Short-term borrowing | 368,144 | 54,197 | - | - | 391,687 | 171,403 | - | - | |
| Total | 797,567 | 191,590 | 973,066 | 14,272 | 773,429 | 390,126 | 822,943 | 44,803 |
| THE COMPANY | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | ||||||||
| Amounts in € '000 | Short-term | Long-term | Short-term | Long-term | |||||
| Within 6 months |
6 to 12 months |
1 to 5 years |
More than 5 years |
Within 6 months |
6 to 12 months |
1 to 5 years |
More than 5 years |
||
| Long-term borrowing | 32,250 | 26,500 | 623,950 | - | 44,903 | 58,722 | 597,144 | - | |
| Other short-term-long-term liabilities |
15,634 | - | 4,955 | - | 12,648 | - | 9,514 | - | |
| Short-term borrowing | 16,822 | - | - | - | 3,270 | - | - | - | |
| Total | 64,706 | 26,500 | 628,905 | - | 60,821 | 58,722 | 606,658 | - |
As presented in the table above, total debt of the Group on 31/12/2017 amounted to € 1,624,303k. Long-term debt amounted to € 980,893k while short-term debt amounted to € 643,410k. Respectively, total debt of the Company on 31/12/2017 amounted to € 699,522k, of which € 623,950k was long term debt and € 75,572k was short term debt.
The Group and the Company on 31/12/2017 had negative working capital, since current liabilities exceeded current assets by € 488,765k and € 75,266k respectively. This issue will be solved following the successful completion of the restructuring of the debt of the companies of the Group (see notes 3.1 and 27).
The transportation sector, given its operational nature, is subject to accident risks that can have adverse effects on results, clients and operations. ATTICA group vessels are insured against the following risks: a) vessel and machine insurance, b) increased value insurance and c) war risk insurance.
Competition between the companies operating in the transportation, healthcare and food and dairy sectors is particularly intense and could adversely affect their sales and profitability.
In the healthcare sector, the competition between the companies is particularly intense mainly because the Public Sector has been unable to cover the ever growing demand and to render quality healthcare services.
In this context, private clinics focused on broadening the services provided and on increasing the response time to the patient, through expansion of the existing facilities to house new departments. For instance, several private clinics include from maternal to diagnostic departments in order to widen the range of services provided.
Another aspect of competition observed in the subsector of provision of private healthcare services is the expansion of collaboration between the private units and the insurance companies to cover hospitalization costs for a wider range of patients. By making use of its comparative advantages, HYGEIA group ensures collaboration with highly reputable private medical practitioners and focuses on the continuous improvement of the high quality healthcare services rendered according to the internationally certified standards, making HYGEIA group the leader in the Greek sector of private healthcare services.
However, should HYGEIA group discontinue its development and investment policy, its competitive position might be significantly affected, which would also affect its financial position.
The food and dairy sector and in particular the subsectors where VIVARTIA group is present (dairy, frozen vegetables and pastry, catering outlets) are facing accentuated competition from both large, domestic and/or international entities in the specific subsectors as well as very small, national and/or local competitors. Potential changes in the frameworks that govern the above subsectors (e.g. product life, food and beverage VAT, social insurance and employment regulations etc) create conditions of intense competition. Additionally, due to the general global trend, but also in particular due to the current economic conditions in Greece, there has been a constant increase in the consumption of private label products, which affects the competition in dairy, frozen vegetables and pastry products. Finally, the catering subsector is present in an equally intense competition environment with the high majority of its competitors consisting of non-organized networks, basically stand-alone shops. The deficiency of the controlling mechanisms creates skewed conditions (non-issuance of receipts, tax evasion, non-registered employment, non-payment of social security contributions etc) and hence unfair competition between the organized chains and the personal businesses with an obvious impact in their sales and profitability.
ATTICA group operates on lines of intense competition which can be further intensified in an effort for companies to acquire a larger share in already mature markets.
All transactions with related parties are on an arm's length basis. Please refer to Note 47 to the Financial Statements for details of these transactions.
The corporate governance framework has been developed in Greece mostly by adopting mandatory rules, such as Law 3016/2002 on corporate governance, which requires the participation of nonexecutive and independent non-executive members in the Board of Directors of Greek listed companies, the establishment and operation of an Internal Audit Unit and the adoption of an Internal Regulation of Operation as well as the provisions of the resolution of the Hellenic Capital Market Commission under number 5/204/14.11.2000 on the "Rules of conduct of the companies listed in the Stock Exchange and of the persons connected to them". Moreover, a series of new legislative statutes incorporated the European corporate law directives in the Greek legal framework, establishing new corporate governance rules such as the following:
Finally, in Greece, the Law on sociétés anonymes (Law 2190/1920, as is in force amended by the above mentioned laws) contains the basic rules for their governance and operation.
In complying with the existing legal framework on corporate governance, the Company has established and adopted a Corporate Governance Code, which is posted in the Company's website www.marfininvestmentgroup.com.
The majority of the Company's Board of Directors consists of non-executive members. In particular, on 31/12/2017, eight (8) out of eleven (11) Board members were non-executive members. Five (5) of them were independent non-executive members. The Board of Directors today consists of eleven (11) Board members, eight (8) out of which are non-executive. Five (5) of them are independent.
The term of the Board of Directors, pursuant to article 19 paragraph 2 of the Company's Articles of Incorporation, is initially set for five years.
Ensuring effective corporate governance is considered a very significant target for the Company. The internal audit system is evaluated on a continuous basis to ensure that a safe and effective audit environment is maintained.
The Audit Committee deals with all serious auditing issues raised by the Management as well as by the internal and external auditors, and informs the Board of Directors accordingly. The Audit
Committee ensures all corrective measures are taken by Management for any established defects of the internal audit system.
Internal Audit is an independent unit whose officers are appointed by the Company's Board of Directors. Internal Audit's operation is governed by a written regulation and reports to the Board of Directors through the Audit Committee, which is empowered to monitor and evaluate its operation.
The object of Internal Audit is to evaluate the adequacy and efficiency of the existing internal audit system of the Company. Every fiscal year, the Internal Audit submits the Annual Audit Schedule to the Audit Committee for approval. Said schedule is prepared in consultation with the Company's Management and upon assessment of the potential risks and their classification based on their significance.
The powers and responsibilities of Internal Audit include the following:
Internal Audit updates the Audit Committee about its operation in writing, through reports prepared on at least a quarterly basis or whenever deemed necessary.
The Company's Internal Audit is in regular contact with the external auditors and the respective departments of its subsidiaries in order to ensure that the Audit Committee will be immediately informed of significant issues pertaining to the operation of the Group companies.
The Company's organization structure is reflected on a specific Organization Chart, which forms part of the Company's Internal Regulation. The Internal Regulation provides the tasks and objects of each department of the Company.
The Board of Directors has delegated certain powers and authorities to officers and members of the Management, monitoring their activities so as to facilitate the Company's efficient operation.
The Company has developed IT Systems which support accounting and financial reporting effectively.
Data and information are protected by implementing adequate procedures of data protection, recovery and back-up, e-mail protection and prevention of malicious acts, ensuring their integrity and smooth management.
The course of financial figures of subsidiaries in relation with the respective forecasts is monitored on a monthly basis, in order to evaluate performance and deviations.
The Company assesses potential risks on an annual basis according to their origin (endogenous – exogenous) and type (strategic, financial, operational risks, risks relating to regulatory compliance and financial reporting). Risk assessment is performed both on a Company and on a Group level, and includes assessment of the eventuality of risks as well as of the effects of each risk.
The Company has established adequate mechanisms for checking and monitoring the condition and value of its investments – assets, in order to assess and manage the risks relating to the preparation of financial statements.
In this context, there are specific procedures implemented in a series of accounting and financial operations such as asset impairment tests, reconciliation of bank and cash accounts, consistency of receivables – liabilities e.t.c.
Moreover, the Group utilizes various financial instruments or implements specialized strategies to limit its exposure to financial risk factors such as financing and interest-rate risks, market risk, fuel price risk, liquidity risk and currency risk.
The information as provided in article 43a paragraph 3, case d΄of the Codified Law 2190/1920, as it is added pursuant to article 2 paragraph 2 of the Law 3873/2010 is included in the explanatory report of the Board of Directors, which is being compiled according to article 4 paragraphs 7 and 8 of the Law 3556/2007 and is incorporated in the report of the Board of Directors.
The General Meeting is the Company's supreme body, convoked by the Board of Directors and is empowered to decide on any matter concerning the Company. Its lawfully adopted decisions are binding on absent or dissenting shareholders as well.
The General Meeting is competent to decide on issues including the following:
a) Extension of duration, merger except for the as provided in article 78 of the Codified Law 2190/1920 absorption or dissolution, conversion, winding up, reinstatement of the Company.
b) Amendment of the Articles of Incorporation except for the cases provided in quotation b΄ of paragraph 2 of article 34 of the Codified Law 2190/1920.
c) Increase or decrease of the share capital, except for the cases of paragraph 2 of article 5 of the Articles of Incorporation and of paragraph 14 of article 13 of the Codified Law 2190/1920.
d) Election of members of the Board of Directors, except for the cases of article 22 of the Articles of Incorporation.
e) Election of auditors.
f) Appointment of liquidators.
g) Approval of the annual accounts (annual financial statements).
h) Distribution of net profits, except for the case provided in quotation 6th of paragraph 2 of article 34 of Codified Law 2190/1920, and
i) Any other item provided by the Law or the Articles of Incorporation.
According to article 25 of the Codified Law 2190/1920, as amended by article 4 of the Law 4403/2016, the General Assembly comes to a meeting compulsory at the seat of the Company or in the district of another municipality within the prefecture of the seat or at another municipality which neighbors to the municipality of the seat, at least once every financial year no later than the tenth (10th) calendar day of the ninth month following the end of the financial year.
The General Meeting may also be held at the district of the municipality, where the seat of the Athens Stock Exchange is located.
The Board of Directors ensures that the preparation and holding of the General Meeting will facilitate shareholders in exercising their rights, who must be completely informed on all matters relating to their participation at the General Meeting, including the items on the agenda and their own rights at the General Meeting.
The Chairman or, as the case may be, the Vice-Chairman of the Board, the Chief Executive Officer or the General Manager, the Chairmen of BoD Committees and the Internal Audit Officer and the ordinary auditor attend the General Meeting of the shareholders in order to provide information and update in matters of their competence brought to discussion, as well as to respond to any queries or clarifications requested by the shareholders.
The General Meeting of shareholders is presided over temporarily by the Chairman of the Board of Directors or, if he is prevented from attending, by the Vice-Chairman or, if he is also prevented from attending, by the eldest of the directors present at the Meeting. A person appointed by the Chairman acts temporarily as Secretary.
The convention, the constitution and the operation of the General Meeting are taking place in accordance with the provisions of the applicable law (specifically articles 25-35 of Codified Law 2190/1920, as it is valid each time) and the provisions of the Company's Articles of Incorporation.
Each share affords all rights provided in the Law and the Articles of Incorporation of the Company, as specifically provided in the explanatory report of the Board of Directors, which is compiled pursuant to article 4 paragraphs 7 and 8 of the Law 3556/2007 and is being incorporated in the report of the Board of Directors.
The minority rights of the shareholders are exercised according to article 39 of the Codified Law 2190/1920, as it is valid. Pursuant to article 27 paragraph 2 b (a) (aa) of the Codified Law 2190/1920, as it is added according to article 3 of the Law 3884/2010, in the invitation of the General Assembly of the Company's shareholders, is included, inter alia, information at least on minority rights provided in paragraphs 2, 2a, 4 and 5 of article 39, mentioning the time period during which each right may be exercised, in the corresponding terms which are defined in the paragraphs of the article 39, or alternatively, the concluding date until which the specific rights may be exercised, provided that more detailed information with regard to the specific rights and the terms of their exercise will be available with explicit reference of the invitation to the address (domain name) of the Company's site.
The Board of Directors manages and represents the Company and is competent to decide on all matters pertaining to the Administration of the Company, the general pursuit of its business objectives and the management of its assets, except from those assigned exclusively to the General Meeting by virtue of the law or the Articles of Incorporation.
According to the Articles of Incorporation, the Company is managed by a Board of Directors consisting of nine (9) at least to fifteen (15) members.
Immediately upon its election, the Board of Directors meets for the purpose of being constituted in body, appointing a Chairman, up to two Vice Chairmen and the Chief Executive Officer or the Chief Executive Officers, and possibly one or several Deputy Chief Executive Officers.
On 03/01/2018 the Non-Executive Chairman of the Board of Directors Mr. Stavros Lekkakos submitted his resignation from the Board of Directors of the Company and on 04/01/2018 the Board of Directors was reconstituted by electing the until then Vice-Chairman of the Board of Directors Mr. P. Throuvalas as new President of the Board of Directors with executive powers.
Also, on 14/03/2018, the Independent Non-Executive Vice-Chairman of the Board of Directors and Chairman of the Audit Committee and the Nomination and Remuneration Committee, Mr. Emm. Xanthakis passed away.
With the decision of the Board of Directors dated 26/04/2018, Messrs. Konstantinos Galiatsos and Anastasios Kyprianidis were elected as new Board members filling vacant seats. Mr. Galiatsos was appointed as Non-Executive Member of the Board of Directors while Mr. Kyprianidis was appointed as Independent Non-Executive Member of the Board of Directors as he fulfills the criteria of independence of article 4 of CL. 2190/1920.
After that, the Board of Directors consists today of eleven (11) members, three (3) of which have executive powers and eight (8) have non-executive powers. Five (5) out of the non-executive members have been appointed as independent. The current composition of the board of Directors is as follows:
Under the decision of the Board of Directors, Mr. Fotios Karatzenis has been appointed as Secretary of the Board of Directors.
According to the Articles of Incorporation, the members of the Board of Directors are elected by the General Meeting for a five-year term. The term of the members of the Board commences on the day following their election by the General Meeting and expires on the respective day of the year of expiry of their term, and is automatically extended until the Ordinary General Meeting following the expiry of their term, without exceeding a six-year period. The term of the current Board of Directors expires on 27/06/2019 and is extended until the Ordinary General Meeting of the year of his term of office. The members of the Board of Directors are always re-eligible, re - appointable and can be freely revoked. Non-shareholders may also be appointed at the Board of Directors.
The Board of Directors is in quorum and is validly convened when half plus one of the Directors are present or duly represented, provided that the number of the Directors who are present is never less than three (3). For the calculation of the number of quorum, any resulting fraction is omitted.
A Director who is prevented from attending may be represented only by another Director. Each Director may represent only one absent Director. In such case, he/she has two (2) votes.
The decisions of the Board of Directors are taken by absolute majority of the present and represented Members, except from the cases of article 5, paragraph 2 of the Articles of Incorporation. In case of parity of votes, the vote of the Chairman of the Board of Directors shall prevail.
The discussions and resolutions of the Board of Directors are recorded in minutes kept in a special book drawn and signed by the Directors present at the meeting. Any dissenting Director may request that their opinion be recorded in summary in the relevant minutes.
The Board of Directors is allowed, following the relevant provisions, to hold a meeting by teleconference. In this case the invitation to the members of the Board of Directors includes the required information with regard to their participation to the session.
The Board of Directors may delegate, only and exclusively in writing, the exercise of all its powers and responsibilities (apart from those which require collective action) and the representation of the Company to one or more persons, members of the Board or not, determining at the same time the extent of such assignment. Furthermore, the Board of Directors may assign the internal audit to one or more persons, members of the Board or not, following the provisions of the applicable legislation. The above mentioned persons may furthermore delegate the exercise of the powers, assigned to them, or part of them, to other members of the Board of Directors, employees of the Company or third persons, under the condition that this is provided in the relevant resolution of the Board of Directors. In any case, the powers of the Board of Directors are without prejudice to the provisions of the articles 10 and 23a of the Codified Law 2190/1920 as it is valid.
Subject to specific authorizations for the execution of specific operations, the Company is represented in accordance with the decisions of the Board of Directors dated 11/07/2016 and 26/01/2017 (which have been registered in GEMH (General Commercial Registry) with code no. Registration No. 741294 and No. 933028 according to the Announcements of GEMH with Protocols No. 502439 of 30/08/2016 and 775863 of 20/2/2017 respectively).
For the more effective supervision of the operation and administration of the Company, the General Assembly and the Board of Directors have constituted committees, which consist of members of the Board of Directors or/and third persons, the powers and way of operation of which are regulated by the Internal Regulation of Operation and the Code of the Corporate Governance and are mentioned in summary as follows:
The main tasks of the Strategic Planning Committee as defined by the Board of Directors' decisions are to monitor on a regular basis and to analyze the strategic options of the Company, to assign to executives special missions for the success of the objectives and, when required, to make a relevant recommendation to the Board of Directors of the Company, to set out the axes of the Business Plan within which the annual Budget is drawn up, to recommend the above issues to be included in the agenda of the Board of Directors or the General Assembly of the Company, to monitor and make recommendations on any issue of strategic importance for the Group. In the event of a crisis, it has the responsibilities of a Crisis Management Committee and has the supervision and oversight of the Recovery Plan.
The Committee consists of the Chairman of the Board of Directors of the Company, the members of the Executive Committee of the Company, the Chief Executive Officers of the companies DELTA, HYGEIA, ATTICA, SINGULARLOGIC and the Group Legal Counsel.
The Committee meets regularly on predetermined dates. Chairman of the Committee will be the Company's Chairman of the Board of Directors. The Committee's decisions are adopted by a majority of 2/3 of its members.
The current composition of the Commission is the following:
The task of the Executive Committee is to continuously supervise all operations of the Company and the Group, to set the targets which will constitute the basis for preparing the budgets of the Group companies for strategic planning purposes, and to monitor the course of financial figures and performance.
The Committee consists of four up to seven members appointed by the Board of Directors. The Chairman of the Committee is appointed by the Committee members or indicated by the BoD.
The Committee meets at least once every two months. The selection of meeting dates depends on factors such as the periodicity of the Company operations, the dates of BoD meetings and any extraordinary issues arising during the course of operations.
The current composition of the Committee is the following:
The role of the Audit Committee is to monitor, among other things, the statutory audit of the annual financial statements, the financial reporting process, the proper functioning of the entity's internal audit unit, the effective functioning of the internal control system and the risk management system.
The Committee consists of three members (two independent non-executive and one non-executive member). The Audit Committee members are elected by the General Meeting of shareholders of the Company in accordance with the applicable Laws. The Committee's decisions are adopted by a majority of 2/3.
The Committee meets at least every three months or whenever considered necessary.
According to decisions of the General Meetings of the Company's Shareholders dated 11/7/2016 and 15/6/2017 and the decision of the Board of Directors dated 26/04/2018, the current composition of the Committee is the following:
The main task of the Committee is to assist the Board of Directors in fulfilling its duties pertaining to issues of staff, remunerations and incentives.
Its role is to make recommendations to the Board of Directors and involves the following:
The Committee consists of three (3) members elected among non-executive members of the Board of Directors by the General Meeting of Shareholders.
The Chairman of the Committee is elected by the Committee members or is indicated by the General Meeting of Shareholders.
The Committee meets at least once per year.
According to decisions of the General Meetings of the Company's Shareholders dated 11/7/2016 and 15/6/2017 and the decision of the Board of Directors dated 26/04/2018, the current composition of the Committee is the following:
| Auditing Firm | GRANT THORNTON S.A. | (I.C.P.A. Reg. No: 127) |
|---|---|---|
| Emmanouil Michalios | I.C.P.A. Reg. No: 25131 | |
| Statutory Auditors: | Dimitra Pagoni | I.C.P.A. Reg. No: 30821 |
This explanatory report of the Board of Directors is being addressed to the Ordinary General Meeting of shareholders of "MARFIN INVESTMENT GROUP HOLDINGS S.A." (hereinafter "the Company") and has been incorporated into the Report of the Board of Directors pursuant to article 4 (7) and (8) of the Law 3556/2007.
On 31/12/2017 the share capital of the company amounted to €281,853,224.40 fully paid, divided into 939,510,748 ordinary registered shares of a nominal value of € 0.30 each. The Company's shares are listed for trading on the Main Market of ASE.
Each share confers all rights as provided by law and by the company's Articles of Association, specifically:
The shareholders' liability is limited to the nominal value of the share.
Furthermore, it is hereby noted that the 2nd Reiterative Annual General Meeting of the Shareholders that took place on 10/07/2017 resolved that a new Convertible Bond Loan be issued (hereinafter referred to as the "CBL") in the maximum amount of € 460,302,000, through issuance of up to 1,534,340,000 bonds of a nominal value of € 0.30 each, convertible into Company's shares.
The coverage and payment by PIRAEUS BANK S.A. of Tranche A amounting to € 425,200,000.20 divided into 1,417,333,334 bonds of a par value of € 0.30 each convertible into Company's shares took place on 31 July 2017 and was certified by the Board of Directors on the same date. The 31st July 2017 was determined as issuance date.
In accordance with the terms of the new CBL, its bonds have not been listed for trading on the Athens Exchange. The proceeds from the issuance were used for refinancing of other existing loan obligations of the Company, including both tranches of the CBL issued on 29/07/2013 amounting to € 375,247,019.
The transfer of the Company's shares is effective in accordance with the Law and there are no restrictions on their transfer pursuant to the Company's articles, considering that they are intangible shares listed on the ASE.
According to the notifications received by the Company from the shareholders - holders of voting rights pursuant to the Law 3556/2007, the shareholders who directly or indirectly hold more than 5% of the total voting rights of the Company on 31/12/2017 are the following:
| Shareholder | Percentage on voting rights based on the latest notification received from the shareholder until 31/12/2017 |
Current percentage on voting rights |
|---|---|---|
| PIRAEUS BANK S.A. | 28.4986% | 31.19% |
| JOCHEN MÜLLER | 9.6597% | Less than 5% (i.e. 4.54%) |
As per article 19 of the Company's Articles of Association, a right to appoint one (1) member in the Company's Board of Directors pursuant to article 18 (3), (4) and (5) of the Law 2190/1920 is
conferred to Messrs. (a) Theodoros Kaloudis, the son of Antonios, and (b) Athanassios Panagoulias, the son of Theodoros, and to each acting separately, provided that each of them owns shares of the Company representing at least 5% of the entire share capital. Messrs. Theodoros Kaloudis and Athanassios Panagoulias may even appoint themselves. In case any of the above shareholders exercises this right, the General Meeting shall limit its respective power to the election of the remaining members of the Board. The aforementioned article has been succeeded from the articles of association of COMM GROUP in its capacity as a successor of the company. Regarding the above, it is hereby noted that neither of the aforementioned persons held a percentage equal or more than 5% of the share capital of the Company on 31/12/2017.
No restrictions or deadlines are imposed by its Articles on exercising of the voting rights deriving from the Company's shares.
The Company is not aware of any agreements between its shareholders which might result in restrictions on the transfer of the Company's shares or in the exercise of the voting rights conferred by its shares.
Besides the above mentioned in paragraph 8.4, the rules provided in the Company's Articles regarding the appointment and replacement of its Board members as well as the amendment of its Articles do not deviate from those provided in the Law 2190/1920.
Α) According to the provisions of article 13 (1) (b) and (c) of the Law 2190/1920 and article 5 (2) of the Articles of Association, within the first five years from the issuance of the relevant decision of the General Meeting, which is subject to the publication requirements as per article 7 (b) of the Law 2190/1920, the Board of Directors of the Company is entitled to increase the share capital of the Company by issuing new shares, by virtue of a decision adopted by a majority of at least 2/3 of the total number of its members. In such a case, the share capital may be increased only up to the amount of the paid-up capital on the date of the adoption of the decision by the General Meeting. The aforementioned power of the Board of Directors may be renewed by a General Meeting for a period not exceeding five years for each renewal, and it shall come into effect upon the expiration of each five-year period.
In respect of the issuance of bond loans, under articles 10 and 11 of the Law 3156/2003, as in force at the time, the Board of Directors shall decide accordingly, pursuant to article 1(2) (2) of the Law 3156/2003. Furthermore, upon decision of the Ordinary General Meeting of Shareholders dated 29/06/2004, the Board of Directors was empowered for a period of five years from the adoption of the said decision, on the one hand, to issue bond loans in accordance with article 1 (2) (6) of the Law 3156/2003, as in force at the time, and, on the other hand, to issue bond loans with the right of bondholders to convert their bonds into shares of the company pursuant to article 3 (a) of the Law 2190/1920 and subject to the conditions of article 13 (1) of that Law. This power of the Board of Directors may be renewed by a General Meeting for a period not exceeding 5 years for each renewal, whereas the said power coming into force upon expiration of each five-year period. Based on the decision of the 1st Reiterative Ordinary General Meeting of Shareholders dated 09/06/2009, the above power of the Board of Directors was renewed for 5 years upon expiry of the five-year
period following the relevant decision of the Ordinary General Meeting of Shareholders dated 29/06/2004, i.e. from 29/06/2009. Based on the decision of the 2nd Reiterative Ordinary General Meeting of Shareholders dated 24/07/2014, the above power of the Board of Directors was renewed for 5 years starting on 24/07/2014, i.e. the date of the relevant decision of the Ordinary General Meeting of Shareholders held on 24/07/2014.
Furthermore, by means of the decision of the 1st Reiterative General Meeting of the Company's shareholders dated 03/06/2010, the Board of Directors was authorized, for a five-year period after the adoption of the relevant decision, to increase the Company's share capital in whole or in part by issuing new shares for amounts not exceeding the amount of the paid-up capital on the date of the General Meeting, in accordance with article 13(1) of the Law 2190/1920. This power of the Board of Directors may be renewed by a General Meeting for periods not exceeding 5 years at a time, entering into effect upon expiry of each five-year period. Based on the decision of the 2nd Reiterative Ordinary General Meeting of Shareholders dated 23/07/2015, the above power of the Board of Directors to increase the Company's share capital was renewed for 5 years starting on 23/07/2015, i.e. the date of the relevant decision.
Β) According to the provisions of article 13 (13) of the Law 2190/1920, by virtue of a decision of the General Meeting, a stock option plan may be implemented in favour of members of the Board and the personnel of the Company and its affiliates, by way of granting a call option pursuant to the specific terms of such decision, a summary of which is subject to the publication requirements as per article 7 (b) of the Law 2190/1920. The decision of the General Meeting shall especially determine the maximum number of shares that may be acquired or issued (the nominal value of which cannot exceed 1/10 of the paid-up share capital as at the date of the decision of the General Meeting) if the beneficiaries exercise their call option, as well as the price and the terms of distribution of the shares to the beneficiaries, the beneficiaries or classes thereof, the duration of the plan and the manner of determination of the acquisition price. By way of a General Meeting decision, the Board of Directors can be authorised to determine the beneficiaries or classes thereof, the manner of exercise of the options and any other terms of the stock option plan. The Board of Directors shall issue the call option certificates and, not less than each calendar quarter, it shall deliver the shares to be issued or issue and deliver shares to the beneficiaries who exercised their option, respectively, increasing the share capital and confirming the payment of the relevant amount. During the current period there is no such stock option plan in place.
C) According to the provisions of article 16 (1) and (2) of the Law 2190/1920, without prejudice to the principle of equal treatment of shareholders being in the same position and based on the provisions of the Law 3340/2005, as in force, the Company itself or a person acting under his/her name but on behalf of the Company may acquire its own shares, only upon approval by the General Meeting of Shareholders, which determines the terms and conditions of acquisition of its own shares and, particularly, the maximum number of shares that may be acquired, the duration of the approval that cannot exceed 24 months and, in case of non-gratuitous acquisition, the minimum and maximum price of acquisition. During the current period there is no plan of acquisition of own shares in place.
There are no important agreements which will come into effect, will be amended or will expire in case of change of control following a tender offer.
There are no agreements of the Company with members of its Board of Directors or its personnel that provide for a payment of compensation, especially, in case of resignation or unfair dismissal or in case of termination of their term or employment following a tender offer.
It is hereby noted that by a resolution of the Annual General Meeting of the Company's Shareholders dated 15/06/2017 the Group's employees' pension plan was approved with a minimum duration of 10 years for the purpose of rewarding the beneficiaries' faith and loyalty towards the Company and ensuring the unhindered continuance of their services. The entire cost of the plan shall not exceed an average amount of €380 thousand per year, depending on the number of beneficiaries.
The following section presents non-financial reporting items and information under provisions of Law 4403/7.7.2016, which has superseded Article 43a, CL 2190/1920 and pertains to Corporate Social Responsibility actions that are implemented by MIG and its subsidiaries. Diversity characterizing MIG's subsidiaries operations reflects the context in which they implement Corporate Responsibility actions.
During 2017 the following events took place per group or company:
Since the majority of the subsectors' operations concern the particularly sensitive and significant domain of nutrition, VIVARTIA group subsidiaries have established extremely high standards. Moreover, compliance with the institutional regulations constitutes a non-negotiable basis of the group companies' operation. Corporate Responsibility is deeply integrated into the culture of VIVARTIA group and its subsidiaries and acts as the key component of the way they operate and grow.
In particular, in 2017, the following CSR actions were implemented, classified per VIVARTIA group operations (DELTA, Food Services and Entertainment GOODY'S | EVEREST and Frozen Foods BARBA STATHIS.
Since its foundation date, DELTA has established extremely high standards in respect of the whole range of its operations. Moreover, compliance with the institutional regulations constitutes nonnegotiable basis of the food segment, serving as a basis for sound management. The company's business model provides a brief description of the way the company operates and grows.
DELTA develops and implements the Corporate Responsibility Action Plan based on the following five (5) strategic initiatives:
For DELTA, adopting sound corporate governance practices and principles contributes to efficiency of the internal organization, while also increasing its competitiveness and maximizing value for the benefit of its stakeholders. Through implementation of these practices and principles, DELTA wants to achieve transparency in management and independence regarding management and control procedures. In this context, the company has developed a clear organizational structure, as well as an effective internal control and risk management system.
As a subsidiary of VIVARTIA group, DELTA implements the "VIVARTIA Code of Business Ethics". Under the Code's provisions, transactions in respect of all the group companies should be conducted in a legal and ethical way, according to the applicable national and international
legislation. With regard to transparency and corruption, specific rules and principles have been put in place in respect of accepting business gifts and avoiding bribery regarding the all the employees.
In particular, preventive actions taken by DELTA and its subsidiaries include establishing specific limits to responsibility for all the employees and imposing relevant controls in order to assess the compliance. Moreover, the company has established the Code of Conduct dealing with procurement of goods and services, under which the group has established specific standards and principles defining the relationship between employees and suppliers with regard to offering or receiving gifts.
The Internal Control Department controls operation of the safeguards established in response to the relevant business risks. In this context, the Department annually carries out numerous control procedures, and, among other things, examines the way in which DELTA Corporate Responsibility issues are implemented. The audit results are compiled and presented quarterly to the VIVARTIA Audit Committee.
Furthermore, based on the precautionary principle, at the management level, DELTA maintains effective risk management system. Therefore, it recognizes, evaluates, prioritizes potential business risks and uses various instruments or implements specialized strategies in order to limit its exposure to the aforementioned risks.
Further information regarding business risk management is presented in the Financial Report of VIVARTIA group.
In accordance with the precautionary principle, DELTA respects the "VIVARTIA Code of Business Conduct", which establishes specific measures and practices applied in order to avoid conflicts of interest. The company's key principle is that its employees should be free from conflicts of interest, which may affect their judgment, objectivity or loyalty. Such principles include issues of parallel occupation, rules and impediments to recruitment and employment of relatives, the Information Security Policy, and the Confidential Information Management Framework.
DELTA, in 2017, won the following Awards and Distinctions:
DELTA's long-standing goal, clearly expressed in the company's vision, is t creation of innovative products of high quality and high nutritional , which will meet the diverse needs of its consumers. DELTA is always committed to achieving this goal through rigorous quality assurance procedures it implies, from the early stages of product design and development to points of sale.
DELTA systematically invests in Research and Development since its establishment, when in early 90s it created and supported the operation of the Research and Development Division via investing in the first pilot and laboratory facilities of the company based in Agios Stephanos Production Unit. Since then, DELTA has invested substantial amounts in research potential, state-of-the-art technologies and cutting-edge equipment, as well as new product development processes, being one of the few companies in Greece to distinguish itself through innovation by developing its own products based on its own highly specialized scientific executives.
Delta's philosophy of product quality assurance is fully in line with the most strict international standards. In this framework, the company applies the provisions of European and national legislation and the relevant Quality Management Standards. More specifically, Quality and Safety Management Systems are as follows:
The company performs the necessary quality controls at every stage of its production process. From the point of recovery of the raw material to the final disposal of the products at the points of sale, DELTA ensures quality, freshness and preservation of tits products nutritional value. For the purposes of ensuring its on-going development based on the provisions of its high quality standards, DELTA has established, for its entire business, internal quality indicators (KPIs), which it constantly monitors. DELTA also has specialized scientific staff, which ensures that the company is fully in line with the European and domestic legal and safety requirements.
Our DELTA Information Centre, which is operational since 2001 and staffed by scientists in the field of food products, allows us to benefit from two-directional communication with consumers and the wider market. Its objective is to ensure the two-way communication between consumers and the market with DELTA. Since 2008, it has been part of the Quality Assurance operations, being of strategic importance to the company as it is the essential Dialogue Center for timely receiving market messages and valid public information from DELTA. It is branded and has its own logo depicted on all DELTA packaging.
DELTA people are the most valuable pillar for the Sustainable Development of the company. For this reason DELTA does the best it can in order to maintain safe, fair and merit-based working environment every day, through which continuous growth opportunities are offered to all its employees.
DELTA is committed to and applies modern methods to facilitate professional growth of its people, provides ongoing and systematic training programs and applies modern assessment and reward systems to enable its people to continually develop and enhance their skills by acknowledging their commitment and contribution.
| DELTA human resources per gender | 2016 | 2017* | |||
|---|---|---|---|---|---|
| Men | Women | Men | Women | ||
| DELTA employees | 972 | 215 | 988 | 213 | |
| Total | 1,187 | 1,201 |
| Human resources age allocation | 2016 | 2017* | ||||
|---|---|---|---|---|---|---|
| <30 | 30-50 | 51+ | <30 | 30-50 | 51+ | |
| Men | 30 | 725 | 217 | 27 | 714 | 247 |
| Women | 15 | 157 | 43 | 9 | 152 | 52 |
| TOTAL | 1,187 | 1,201 |
*The data in respect of 2017 also include the employees of the subsidiary VIGLA, absorbed by DELTA within the FY.
DELTA's long-term objective is to provide appropriate training and know-how to its employees in order to facilitate their on-going development and and enrich their knowledge. Through the training provided by the company, the employees obtain the necessary skills assisting them in finding immediate solutions to everyday challenges and at the same time improving their productivity. The company implements a variety of educational activities, including seminars, conferences, provisions of certifications, and financing postgraduate programs.
Structured training programs involve enrichment of knowledge as well as development of the employees skills and competences. The analysis of DELTA educational programs, per gender and hierarchy, is as follows:
| 2016 | 2017* | |||||
|---|---|---|---|---|---|---|
| Total training hours per hierarchy category | Men | Women | Total | Men | Women | Total |
| Directors | 113 | 44 | 157 | 47 | 37 | 84 |
| Executives | 511 | 174 | 685 | 519 | 190 | 709 |
| Employees | 1,356 | 785 | 2,141 | 752 | 946.5 | 1,699 |
| Foremen and workmen | 2,143 | 194 | 2,337 | 2,172 | 314 | 2,486 |
| Total | 4,123 | 1,197 | 5,320 | 3,490 | 1,488 | 4,978 |
* The data in respect of 2017 also include the employees of the subsidiary VIGLA, absorbed by DELTA within the FY.
DELTA implements a system aimed at assessing its employees performance. It is a modern system of development, which emphasizes both performance, conduct and skills of every employee. Emphasis is also placed on graduation of skills, which are directly related to the specificities of every position. Through the results of the assessment, strengths and weaknesses of every department are identified and decisions are made regarding professional development every employee.
The working culture established in DELTA is based inter alia on encouraging diversity. The company recognizes that human resources comprise various kinds of people who have their own mentality, lifestyle and goals. All the employees, regardless of age and gender, are widely supported and granted equal opportunities for growth and development.
The company respects human dignity and assists communities at local, national and global level, taking into account the issues in question and geographic spread. It respects human rights, is opposed to child labor, provides equal rights to men and women, ethnic, religious and racial minorities. It seeks collaborators who share its moral values.
For the purposes of avoiding any form of harassment in the workplace, employees are not allowed to comment on age, race, political beliefs, trade union membership, religion, sexual orientation, marital status, pregnancy, citizenship and potential special needs regarding clients, colleagues, visitors and collaborates.
Ensuring Health and Safety of its people is a daily concern for DELTA. The company's commitment to health and safety at work is expressed through the policy it has developed and implemented at all production units and facilities.
DELTA remains committed to the following issues:
• Development, implementation, maintenance and continuous improvement of Health and Safety at Work Management System
• Full compliance with the relevant national and European legislation on health and safety at work
• Prevention and permanent reduction of accidents at work and occupational diseases and continuous improvement of the working environment
• Protection of employees and third parties from occupational hazards
• Preventing and eliminating occupational hazards at source
• Creating responsibility for the measures that the employees must take to protect themselves and their colleagues and for consolidation of safe working conduct
• Commitment of external partners to take similar measures
Health and safety programs that are implemented are formulated on an annual basis according to the projections made in respect of every production facility and according to the results of the analysis of health and safety indicators.
DELTA's investment in health and safety is an integral part of its commitment to its employees. The annual needs of every production facility, as well as headquarters for health and safety, are carefully evaluated, ranked, and then implemented by the company.
Protection of environment constitutes priority to DELTA and, since its Management's commitment, it is implemented through integrated management systems, always with the contribution of all employees. The company has adopted and implemented Environmental Policy, in which context it develops and implements actions, demonstrating its respect for natural environment, always based on precautionary principle.
(…)Regarding the total of its operations, DELTA maintains stricter rules and standards related to respecting and protecting the environment, taking into account all scientific developments, by
evaluating and controlling all data and by applying, as far as possible, the most appropriate preventive and corrective actions.
Environmental policy applies to all areas of the company's operations, based on the needs of all those involved in the life cycle of the company's products.
DELTA undertakes significant initiatives aimed at ensuring efficient use of energy and water resources, and always makes attempts to minimize the environmental impact of its operations. In doing so, it not only demonstrates its commitment to care and protection of the natural environment, but also remains faithful to its objective, that of achieving sustainable development. DELTA initiatives aimed at environmental and protection actions include Energy Consumption, Water Supplies Use, Product Packaging, Waste and Transportation of its products.
| Electricity consumptions | 2016 | 2017 |
|---|---|---|
| Consumption in MWh | 51,703 | 52,252 |
| Specific consumptions Kwh/tn | 2,117 | 2,149 |
| Water consumption in m3 | 2016 | 2017 |
|---|---|---|
| Water Supply Network | 1,073,431 | 1,227,867 |
| Licensed drilling | 74,132 | 30,000 |
| Other (water from Aliakmonas) | 303,090 | 0 |
| TOTAL | 1,450,653 | 1,257,867 |
DELTA's production unit in Platy Imathia is certified according to the international environmental management standard ISO 14001.
DELTA supports Greek primary production and remains the largest buyer of cow's milk, absorbing over 25% of total quantities of milk produced by Greek livestock breeders. In 2017, it continued collaborating with Piraeus Bank in the domain of contractual livestock farming, aiming at providing the livestock farmers with the necessary liquidity on satisfactory terms and on-going support and development of dairy livestock farming.
Moreover, in 2017, the company went on with the implementation of GAIA ACTION PLAN, which is its initiates aimed at: a) sustainable development and, more specifically, providing support for Greek dairy livestock farming through research, training and technical support actions, and b) exploitation of Greek crops for production of animal feed.
Regarding training in livestock issues, two training sessions were organized by Delta Dairy Zone in Xanthi and Lagadas, Thessaloniki, on welfare, productivity and quality as key factors for viability of livestock breeding. In collaboration with the Agricultural University of Athens, in 2017, the Farm Advisory Program on Nutrition and Management was developed, a program that has begun since 2016 and gradually benefits from the growing number of livestock farmers that are part of it. DELTA also offered, within GAIA project, 14 scholarships to young breeders for education they received at the American Farm School. The young breeders attended four-month training programs on training techniques in the management of the livestock unit.
For analytical information, please refer to the site: http://gaiaproject.vivartia.com
DELTA believes that Corporate Responsibility is an integral part of its operation. For the Greek company, trusted by tens of thousands of Greek families every day, a responsible operation combined with the support of society, especially children and the family, is a central component of its strategy and its core mission. By demonstrating its social sensitivity in actions, DELTA undertakes actions on the following social axes:
The company implements a variety of actions in collaboration with reputable institutions, helping to meet basic nutritional needs. In 2017, DELTA distributed more than 900,000 portions of food to cover the basic nutritional needs of our fellow citizens through the following initiatives:
BARBA STATHIS operates in food retail sector, the leading food company in Greece, offering consumers the best quality products, bearing the label of the successful brands "BARBA STATHIS" and "CHRYSI ZYMI". The main pillars of the company's operation are innovation, quality, investment in Greek entrepreneurship, research / development and extroversion, with a clear goal to offer consumers daily value-added, safe and quality products, with human resources as a key lever.
The company, for 50 years, has been investing in quality, innovation and Research and Development, and supports the primary sector and Greek entrepreneurship. In this way, and as an active member of Greek society and economy, BARBA STATHIS sets out its strategy of operation for implementing the vision and achieving the goals.
Our vision is to offer consumers safe and quality added-value products, contributing to the formation of dietary patterns inspired by Greek nutritional wisdom, while at the same time promoting a healthy lifestyle.
BARBA STATHIS S.A. carries out its business strategy based on the vision, its mission and values, aiming at improving both corporate performance, as well as the implementation of important corporate responsibility actions. Within the framework of its business strategy, the company takes care of the continuous development of its employees, evolves through new investments and makes efficient use of sources and funds.
Corporate Responsibility is an integral part of the BARBA STATHIS culture and defines its business choices and actions, to the maximum extent possible. The Corporate Responsibility Action Plan focuses on five main axes:
BARBA STATHIS proceeded in 2017 to the publication of the 1st Corporate Responsibility Report, in which it analyzes the actions implemented by the company on the basis of corporate responsibility, in its effort to respond consistently and promptly to the needs of the parties interested in it. The Annual Corporate Responsibility Report of BARBA STATHIS is developed according to the international standards of GRI Standards.
The Corporate Responsibility of BARBA STATHIS, as well as the maximization of its social commitment, is synonymous with the development of dialogue with the parties interested in it. The company has recognized that systematic dialogue contributes to the fuller recording of the impacts of its activity, as well as to the recording of the issues that concern each interested parties. The company has identified as interested parties those groups that are directly or indirectly affected by its activities and, of course, all those groups which may affect its operation in any way and at any time. The groups of interested parties that the company has recognized and systematically communicates with are the following:
N.G.O. & vulnerable social groups Local communities
Suppliers Farmers-producers
The company has developed its business model by incorporating important elements such as responding to consumer and market needs, seamlessly cooperating with farmers and the supply chain as a whole, and adopting technological innovations for quality and the safety of raw materials and finished products.
The company pays particular attention to the application of clear operating rules and principles of good corporate governance, both within the group and its affiliates, with a view to transparency in management and independence in management and control. The organizational structure of the company, with its risk management and internal control system, contributes to the achievement of its objectives both short and long term.
The Internal Audit Department operates on the basis of Internal Auditing Standards and the Code of Ethics as issued by the Institute of Internal Auditors, including other audit standards where applicable. The Management conducts numerous audits annually and, among other things, examines how to apply issues related to Corporate Responsibility of BARBA STATHIS. The audit results are compiled and presented quarterly to the VIVARTIA Audit Committee. Also, applying the precautionary principle, the company maintains an effective risk management system at the Management level. Therefore, it recognizes, evaluates, prioritizes potential business risks and uses various instruments or implements specialized strategies to limit its exposure to them. The scope of the Internal Audit Division's activity is to determine whether the risk management, safeguards, and corporate governance processes of the company, as designed and applied by management, operate in a manner that ensures that:
BARBA STATHIS as subsidiary of VIVARTIA group maintains the "VIVARTIA Code of Business Ethics". Under the Code's provisions, all transactions should be conducted in a legal and ethical way, according to the applicable national and international legislation. With regard to transparency and corruption, specific rules and principles have been put in place in respect of accepting business gifts and avoiding bribery regarding the all the group's employees. In particular, preventive actions taken by BARBA STATHIS include establishing specific limits to responsibility for all the employees and imposing relevant controls in order to assess the compliance. Moreover, the company has established the Code of Conduct dealing with procurement of goods and services, under which the group has established specific standards and principles defining the relationship between employees and suppliers with regard to offering or receiving gifts.
In addition, the suppliers themselves are under obligation to respect and observe the relevant Suppliers/Partners Code of Ethics that has been developed and carry out their transactions with the company within the relative framework. The objective of BARBA STATHIS is to ensure honest and faultless way of transacting with its stakeholders and generate added value.
The company follows the rules of healthy competition, applies the VIVARTIA group Code of Conduct and fully respects the relevant provisions of national and community law.
The company promotes healthy and fair competition and is not involved in unfair discussions and agreements or in acts that contravene good morals and laws. The company does not engage in unfair pricing agreements, pre-agreed tenders, customer acquisition, market sharing. By following the rules of healthy competition, the company avoids promoting its products through unfair advertising, respecting the relevant provisions of national and Community legislation.
For BARBA STATHIS, its people are the most valuable pillar of its development. The company offers a working environment where it is possible to constantly develop and demonstrate their abilities, recognizing their dedication and contribution.
BARBA STATHIS takes care of the maintenance of a safe, fair and merit-based working environment that constantly provides opportunities for further development for all employees. The Code of Conduct of VIVARTIA group is adopted and applied to the company.
Basic Principles and Values of the Code of Business Conduct:
We respect the dignity and honor of all people, following a merit-based approach to choosing and developing staff and associates. We encourage initiatives and innovations in an environment of flexibility, cooperation and trust. We create and maintain a healthy and secure work environment.
The working culture of BARBA STATHIS is based inter alia on encouraging diversity. The company recognizes that human resources are staffed by different people with their own personality, lifestyle and goals. All employees as a whole, irrespective of their age and gender, are actively supported by the company in order to give them equal opportunities for development. BARBA STATHIS makes no distinction between the genders.
| Human resources * | 2016 | 2017 |
|---|---|---|
| Men | 343 | 347 |
| Women | 127 | 124 |
| TOTAL | 470 | 471 |
| Human resources age allocation 2017* |
<30 | 30-50 | 51+ |
|---|---|---|---|
| Men | 36 | 215 | 96 |
| Women | 18 | 72 | 34 |
| TOTAL | 54 | 287 | 130 |
*Seasonal employees are also included
Continuous training of human resources is a long-term goal for BARBA STATHIS, as in this way the personal and professional development of its employees is achieved. In this context, educational activities, whether internal, such as seminars and intra-company education, or external ones, such as participation in conferences, certifications and grants of postgraduate programs, are being organized. Through the training programs that the company plans and implements, workers are offered a variety of opportunities to develop knowledge and skills, information on industry issues
and know-how. Structured training programs are aimed at enhancing knowledge as well as developing employee skills and skills, and in the majority they are implemented by learning academies Sales and VIVARTIA Academy.
Programs implemented through Sales Academy mainly concern Sales Departments executives, as well as other executives, whose educational needs are identical to the relevant issues covered during the seminar. Sales Academy lectures are certified Sales Departments executives.
VIVARTIA group Learning Academy aims at training the group companies' employees, as well as their selected collaborators. Training is carried out on voluntary basis by experienced executives of the group, who are either certified trainers or specialize in the subject of every training session. The subjects of training sessions are related to various soft skills. More specifically for BARBA STATHIS in the last two years, the analysis of educational data by gender and hierarchical rank includes:
| Total number of employees receiving | 2016 | 2017 | ||||
|---|---|---|---|---|---|---|
| training | Men | Women | Total | Men | Women | Total |
| Directors | 11 | 4 | 15 | 7 | 1 | 8 |
| Supervisors | 6 | 4 | 10 | 20 | 2 | 22 |
| Employees | 62 | 9 | 71 | 82 | 29 | 111 |
| Foremen and workmen | - | - | - | 94 | 46 | 140 |
| Totyal | 79 | 17 | 96 | 203 | 78 | 281 |
BARBA STATHIS contributes in the development of the local community and employs the majority of its staff (378 persons) from the wider region of Thessaloniki, while 85 people are employed in the offices of Athens. Also, 8 employees are employed in the company's logistics facilities in Larissa.
At BARBA STATHIS, a modern employee assessment and development system is implemented, which emphasizes both performance and behavior and employee skills. Through the evaluation, the strengths and weaknesses of each employee, as well as the department in which they are employed, are identified and decisions are made on their development and reward, on the basis of objective criteria and the degree of achievement of the objectives set.
In the context of employee recognition and rewarding, BARBA STATHIS, every year offers employees the ability to communicate with the Management Team an idea they have developed and implemented in the year and has as a final (indirect or direct) result in improving the company's profitability. The concept that has been developed - individually or in groups - should be one of the following:
Efficiency – Excellence in Execution
A key component of the BARBA STATHIS, culture is its commitment to human and labor rights. Human rights in the workplace are of fundamental importance and ensure the sustainability of the company. No form of discrimination or violation of workers' rights is accepted in BARBA STATHIS as internationally recognized human rights and fundamental freedoms, enabling all employees to develop and grow fully, are an integral part of the company's culture.
In addition, BARBA STATHIS chooses collaborators who, in turn, respect human rights, do not in any way affect human dignity and, of course, oppose child labor and forced labor.
Extract from VIVARTIA group Code of Conduct.
The company respects human dignity and assists local, national and global society, depending on its subject and geographic spread. It respects human rights, opposes child labor, gives equal rights to men and women, ethnic, religious and racial minorities. It chooses collaborators who accept the same moral values.
In addition to the statutory fees, BARBA STATHIS strengthens the support of its people by offering a range of additional benefits. Indicatively, some of these benefits are listed below:
With main pillar the support of Greek agriculture through the support of young Greek scientists, the company, in cooperation with the Department of Agriculture of the Aristotle University of Thessaloniki, gave the opportunity to 2 graduates to be trained in applied cultivation practices.
This initiative enabled young agronomists to acquire work experience in their field and to come in close contact with state-of-the-art research and technology applied by BARBA STATHIS, daily while one of them remained in the company and joined directly to the company's human resources.
In 2017 the company awarded the children of the employees who succeeded in the entrance examinations at University and Technological Institutes.
For BARBA STATHIS, the primary objective is to ensure the health and safety of all its employees. This objective is achieved through:
The company has developed and implemented in all areas of its activities, Health and Safety Policy
at labor, through which it is committed, inter alia, to the following:
The objectives of the programs, procedures and guidelines for the establishment, revision and achievement of the Health and Safety objectives set and monitored by the company are documented by the development of a Health and Safety system as provided for in the relevant certificate, is currently integrated as a separate thematic unit in the uniform quality and safety standard EN ISO 9001/2015 & EN ISO 14001/2015.
BARBA STATHIS always keeps up safe working conditions, recognizes its responsibilities towards its employees and applies the principle of prevention on health and safety at work. It is worth noting that the activities of BARBA STATHIS are characterized as low risk, however, the company has compiled a fully revised Occupational Risk Assessment Study (ORAS). There are very rare
accidents in the company as it is a low-risk activity.
BARBA STATHIS records and monitors the days of absence from work due to any weakness of the employees. In particular, the Employees' Index of Employees (AR) for the years 2016 and 2017, which has remained at the same low level, is presented.
ΑR= (number of days absent from work due to any inability / number of days worked in each year).
0.99% 1.1% 0,0% 0,5% 1,0% 2016 2017 Absentee Rate (ΑR)
The responsibility of BARBA STATHIS is reflected daily in the high quality products it produces, as well as in the trust and honesty relationships it develops with consumers, customers and cooperating Greek producers. The aim of the company is to make the name "BARBA STATHIS" a synonym for quality as well as a reference point for consumer welfare. By prioritizing the responsible operation towards all its stakeholders, the company's strategy is based on the following axes:
BARBA STATHIS is the first company in Greece that has contributed and continues to contribute to the creation of added value for the producers while at the same time ensuring the constant quality and characteristics of varieties in agricultural products by introducing in its activity the terms "contractual agriculture" and "producer groups". For BARBA STATHIS contractual agriculture is a modern, dynamic approach to rural management, aiming at sustainability and support of primary production. In this context, the company offers the possibility to selected producers who meet the criteria they have set, to cultivate excellent, traditional varieties, supporting them through continuous education, empathy and transfer of know-how, with the guidance, supervision and daily visits of the company's agronomists on their parcels. At the same time, the application of contractual agriculture responds to the need of producers to secure a guaranteed income and to the company's desire to have guaranteed access to products of guaranteed quality and quantity.
Throughout the production process, BARBA STATHIS ensures and documents the Quality and Safety of its products through the implementation of a horizontal system certified according to international standards: EN ISO 9001, EN ISO 22000, I.F.S. Food and B.R.C.
A non-negotiable priority for BARBA STATHIS is the creation of relationships of trust with consumers. Having at the heart of its activities the satisfaction of the consumers of its products, the company makes every effort to inform and raise awareness of healthy nutrition through the innovative, healthy and high quality products it develops and produces. At the same time, the company conducts a consumer satisfaction survey every two years, using it as a means of feedback with them.
Communication with the consumer is of prime importance for BARBA STATHIS and is documented through a separate process within the quality management system: EN ISO 9001/2008.
For 50 years, BARBA STATHIS stands next to Greek consumers, aiming to offer them delicious, nutritious and quality products produced by the Greek land. The company's efforts to integrate innovation and high standards of food safety into every product received a variety of awards and distinctions. Specifically in 2017, the company and / or its products received the following distinctions:
Significant were the awards in product categories also. More specifically: Successful product listing for Gold Dough and the new category of total food products was awarded to BARBA STATHIS as part of the award ceremony of the "self-service Excellence Awards 2017", while the new product categories FRESH VEGETABLES MASHES BARBA STATHIS and PIZZA CHRYSI ZYMI were the most successful launches of 2017 for the categories of frozen vegetables and doughs respectively at the 17th Marketing & Sales Conference held under the auspices of Sales Marketing & Business Review. Last but not least, BARBA STATHIS is awarded with the Gold Award for
Salad Wellness and Silver Award for the new product line PIZZA CHRYSI ZYMI, at the Packaging Awards 2017.
The company regards its suppliers as valuable partners and an integral part of its operational function and seeks to develop long-term cooperative relationships based on mutual benefits and common sense. Transparency and consistency are key components of BARBA STATHIS cooperation with its suppliers, which give a comparative advantage to several tailor made products of the company. BARBA STATHIS has achieved long-term partnerships and trust relationships with responsible and acclaimed suppliers.
Suppliers selection criteria and procedures are common to all suppliers and are documented by ISO 9001 and related internal procedures. The company has a Code of Business Ethics, which defines the core values and principles of the company. Additionally, the Code of Ethics for Procurement, which is an attachment to the Procurement Process, defines the framework for cooperation with suppliers, as well as the relevant transaction and behavior procedures of suppliers.
Extract from Code of Conduct:
All suppliers should be treated equally in terms of the ability to present their products and services to the company and should be offered impartial and equal opportunities. .
The total number of suppliers of BARBA STATHIS is 7,581, of which 96% is made up of domestic suppliers. More specifically:
Protecting the natural environment is a top priority for the company. Through its practices and actions, BARBA STATHIS aims to contribute actively to saving energy and minimizing pollutants, increasing recycling actions, protecting the biodiversity of the ecosystem, and promoting the proper use of water. The commitment to responsible environmental behavior is reflected in the environmental policy adopted by the company, but also in the ISO 14001 certified environmental management system that it applies.
The primary role in the business strategy is the protection of the environment from the effects that the (above) activities are or may be causing.
With the implementation of the Environmental Management System, the company expresses its commitment:
BARBA STATHIS ensures the maintenance of its environmental policy at all organizational
The Environmental Management System applied to the company contributes to the practical improvement of its environmental performance through the achievement of specific objectives. In this context, an environmental manager is appointed who is in charge of enforcing environmental policy, as well as implementing and documenting the company's environmental objectives. In addition, the company implements programs aimed at the rational use of nutrients (reduction of the use of nutrients due to natural fertilization resulting from the incorporation of plant residues in the field) and reduction of plant protection actions.
I. Electricity consumption per production unit (total and specific - per tone of product)
| Electricity consumption | 2016 | 2017 |
|---|---|---|
| Specific electricity consumption (per tone of product) (KWh/tone) |
436 | 428 |
| Specific thermal energy consumption (per tone of product) (KWh/tone) |
182 | 173 |
II. Water consumption (specific consumption - per tone of product)
| Water consumption in m3 | 2016 | 2017 |
|---|---|---|
| Specific water consumption per tone of product (m3/ tone) |
15.70 | 14.70 |
As the company's environmental policy defines, the proper collection and utilization of the waste resulting from the production process is a non-negotiable priority for BARBA STATHIS. To this end, the company applies good management and disposal practices and undertakes further education and awareness initiatives for employees about these practices.
No hazardous waste is generated from the production activities of BARBA STATHIS
The company's production processes result in liquid and solid waste, which are separated and received by suitably licensed partners for their overall management. For the year 2017, the total (100%) of the Company's waste was allocated to licensed partners.
The main concern of BARBA STATHIS is to support social groups, giving priority to the child and the family, both through catering needs and through other social care activities. At the same time, the company, while remaining a responsible and active member of society, supports and highlights the volunteering of its employees through a variety of programs, which are repeated at regular intervals.
With priority to children, BARBA STATHIS has been committed to supporting our fellow human beings who are most in need and contributing to the needs of Greek society through a variety of actions and actions.
Free supply of more than 17 tons of products in total, thus supporting the important work of charities, associations and local bodies, social Municipality and Community grocery stores.
One of the most important initiatives was the organization of the charity walk "Take a Step in Healthy Diet" on the occasion of World Food Day where the company distributed 10 tons of frozen vegetables to the Social Grocery in Thessaloniki. In addition, in the context of the distribution of the value of balanced nutrition and the message that exercise and healthy nutrition go together, the company supported the 1,000-meter Children's Road Structure for Elementary School pupils in the framework of the 12th International Marathon "Alexander the Great".
Financial support was provided by the company at the concert organized by the Union "Together for Children", the revenue of which contributed to meeting the children's food needs supported by the Union. It also provided financial support to the Association of Friends of Children with Cancer "Storgi" and the SOS Children's Village in Plagiari.
Last but not least, the collection and distribution of money from the employees of BARBA STATHIS in the SOS Children's Village in Filiro to cover immediate needs in food and medical supplies was of great importance.
GOODY'S | EVEREST group is the undisputed leader in the Greek market for catering and coffee services. The group's long-term goal is to produce and deliver high-quality products and services to consumers while contributing to the creation of added value for all interested parties.
For GOODY'S | EVEREST group Sustainable Development and Corporate Responsibility is in tune with continuous improvement and high quality in all areas of our operations. GOODY'S | EVEREST group priority is the investment in Greek entrepreneurship and innovation, aiming at the continuous development, development and upgrading of brands.
In the above context, the group has developed its business model, incorporating significant elements such as critical partnerships, core resources, distribution channels for its products and services, and customer categories. All of this, combined with the cost and revenue structure, is the source of the group's competitive advantages and the way it generates value through its operations.
The Internal Control Department controls operation of the safeguards established in response to the relevant business risks. In this context, the Department annually carries out numerous control procedures, while the results are compiled and presented quarterly to the VIVARTIA Audit Committee.
Furthermore, based on the precautionary principle, at the management level, the group maintains effective risk management system. Therefore, it recognizes, evaluates, prioritizes potential business risks and uses various instruments or implements specialized strategies in order to limit its exposure to the aforementioned risks
Further information regarding business risk management is presented in the Financial Report 2017 of GOODY'S as well as the Financial Report 2017 of EVEREST.
GOODY'S | EVEREST group implements the "VIVARTIA Code of Business Ethics". Under the Code's provisions, transactions in respect of all the group companies should be conducted in a legal and ethical way, according to the applicable national and international legislation. With regard to transparency and corruption, specific rules and principles have been put in place in respect of
accepting business gifts and avoiding bribery regarding the all the employees. Moreover, the company has established the Code of Conduct dealing with procurement of goods and services, under which the group has established specific standards and principles defining the relationship between employees and suppliers with regard to offering or receiving gifts. In addition, suppliers shall also respect and comply with the relevant "Suppliers/Partners Code of Conduct" that has been developed and transact with the company within that framework.
The group's goal is to transact with all stakeholders in an honest and correct manner, generating added value.
In accordance with the precautionary principle, the group respects the "VIVARTIA Code of Business Conduct", which establishes specific measures and practices applied in order to avoid conflicts of interest. The company's key principle is that its employees should be free from conflicts of interest, which may affect their judgment, objectivity or loyalty. Such principles include issues of parallel occupation, rules and impediments to recruitment and employment of relatives, the Information Security Policy, and the Confidential Information Management Framework.
For GOODY'S | EVEREST, employees are a valuable partner in its development and achievement of competitive advantage. In this context, the group takes care of a work environment characterized by equal opportunities, continuous education and training, meritocratic assessment and additional benefits. Also, recognition of people's dedication and offering, gives then the ability to constantly evolve through their skills.
| Human resoureces GOODY'S EVEREST | ||||
|---|---|---|---|---|
| 2016 | 2017 | |||
| Men | 1,211 | 1,209 | ||
| Women | 1,245 | 1,242 | ||
| Total | 2,456 | 2,451 |
| Human resources age allocation 2017 | |||||
|---|---|---|---|---|---|
| <30 | 30-50 | 51+ | |||
| Men | 640 | 466 | 103 | ||
| Women | 707 | 392 | 143 | ||
| Total | 1,347 | 858 | 246 |
| Number of employees | 2016 | 2017 | ||||
|---|---|---|---|---|---|---|
| receiving training | Men | Women | Total | Men | Women | Total |
| Directors | 146 | 68 | 214 | 135 | 101 | 236 |
| Supervisors | 222 | 131 | 353 | 213 | 142 | 355 |
| Employees | 636 | 784 | 1,420 | 603 | 892 | 1,495 |
| Foremen and workmen | 76 | 55 | 131 | 54 | 95 | 149 |
| Total | 1,080 | 1,038 | 2,118 | 1,005 | 1,230 | 2,235 |
The companies GOODY'S | EVEREST, as subsidiaries of VIVARTIA group, implement the "VIVARTIA Code of Business Ethics". Under the Code's provisions, transactions in respect of all the group companies should be conducted in a legal and ethical way, according to the applicable national and international legislation. With regard to transparency and corruption, specific rules and principles have been put in place in respect of accepting business gifts and avoiding bribery regarding the all the employees. The Code refers to the basic principles and regulations governing all GOODY'S | EVEREST group operations. It is based on best practices in line with the effective legal and regulatory obligations. The Values and Principles of "VIVARTIA Code of Business Ethics" are the basis of the group's Policies and Procedures.
The training process takes care of meeting the training needs of employees on an annual basis. Structured training programs pertain to enriching knowledge and developing skills and competencies of employees. The employees of GOODY'S | EVEREST group are also trained through VIVARTIA Academy, which aims to train employees of VIVARTIA group companies as well as their selected partners. The subject is related to various specialties or soft skills. More specifically, in 2016 and 2017, GOODY'S | EVEREST performed the following training activities:
| MAN-HOURS | ||||||
|---|---|---|---|---|---|---|
| Total Training Hours |
Total Number of Participants |
External Training Hours |
Number of External Participants |
Internal Training Hours |
Number of Internal Participants |
|
| 2016 | 23,894 | 3,336 | 6,696 | 641 | 17,198 | 2,695 |
| 2017 | 30,248 | 4,772 | 6,828 | 925 | 23,600 | 3,847 |
| MAN-HOURS / SUBJECTS | ||||||||
|---|---|---|---|---|---|---|---|---|
| Managerial & Self Development |
Finance / QA / Operations | Production / Procurement / Technical Maintenance |
Marketing / Sales / Customer Service |
|||||
| Hours | Participants | Hours | Participants | Hours | Participants | Hours | Participants | |
| 2016 | 1,933 | 191 | 18,152 | 2,469 | 652 | 289 | 3,157 | 387 |
| 2017 | 1,543 | 214 | 21,765 | 3,540 | 1,002 | 201 | 6,118 | 817 |
Investment in the development of its people is one of GOODY'S | EVEREST top priorities. Through clear targeting, continuous upgrading of skills through education and alignment towards personal and corporate goals. In this context, the company implements a Employee Performance and Development System, which is mainly aimed at the following:
In addition to annual assessment, a two-year 360° assessment is also carried out in cooperation with an external partner. GOODY'S | EVEREST objective, through the rating system, is - in addition to remuneration - to identify the strengths and weaknesses of each employee and to make decisions about their development and employment in the appropriate department and location.
GOODY'S | EVEREST adopts and applies VIVARTIA group Code of Conduct, whose latest revision took place in 2015.
Some basic principles and values of the Code of Conduct are as follows:
Based on the Code of Conduct, the group has developed a strong working culture, the core of which is respect for human and labor rights. In this context, the GOODY'S | EVEREST encourages diversity, recognizing that human capital includes different people with distinct personality and goals.
GOODY'S | EVEREST, has given high priority to safeguarding health and safety of its employees at all the stages of its operations. In this context, it applies Health and Safety Management System certified by the international OHSAS 18001 standard. Through constantly monitoring and improving this System, it identifies, evaluates and controls all related health and safety issues at work, and issues related to occupational hazards in all its productive and commercial operations, including replacement of production, inspection, support and transport equipment, as well as construction or repair works.
The group has as permanent objectives and is committed:
on the one hand, to continuously improve health and safety at work in a systematic manner, and - on the other hand, to prevent and minimize accidents and occupational diseases, achieving it through:
installation of appropriate protective devices,
| INDICATOR | DESCRIPTION |
|---|---|
| Non-Accident Indicator | Maximum number of days without accident / production unit |
| Major accidents at work | Total number of accidents at work (recorded in the Accident Book (s)) resulting in absence of an accident over 3 working days per year/ number of personnel / production unit/year |
| Emergency preparedness | Time of production unit evacuation (during the annual evacuation exercise) / number of personnel /production unit / year |
| Accident costs | Total cost of accidents / number of employees of Hellenic Catering / production unit / year |
| Near accidents | Total number of near accidents / number of employees of Hellenic Catering / production unit / year |
| Index | of | Average | Accident | 365 days / Total number of accident Hellenic Catering / production plant |
|---|---|---|---|---|
| Periodicity |
Children's Celebration 22/12/2017 for children of employees.
The Christmas celebration event included mascots, construction workshops, face painting, Magician and gifts for children. The event was held at the headquarters and attended by over 70 children of employees.
«YES, WE CAN»: collecting 366 food boxes distributed to the City of Athens Reception & Solidarity Center.
In 2017, we managed to collect even more portions of food and increase food support to charities through «YES, WE CAN» offering a total of 2,174 food boxes.
In 2017 two blood donations sessions were carried out in cooperation with Nikaia Hospital, where the total number of people reached 85 and we helped more than 45 people in need of blood. Blood donations were carried out in the central building of the Administration in EL.VENIZELOS AIRPORT, with the participation of the employees of the central management of the group.
GOODY'S | EVEREST is the largest group occupied in the domain of food services and entertainment in Greece and one of the largest in Europe.
It owns and manages some of the biggest food services brands in Greece such as: Goody's Burger House, Everest, Flocafe Espresso Room, La Pasteria, Papagallino, Olympus Plaza and the awardwinning Kuzina restaurant.
It also has 3 state-of-the-art factories production units in Attica and Thessaloniki of a total area of 47,800 square meters, which together have the capacity to produce 70 tons of products per day. These units produce ready-made meals (chilled & frozen), meat products, salads & dressings & baking products for the brands of the group as well as for the whole catering market. They are leading industrial catering companies that are constantly investing in the research and development of innovative and high-safety products, as well as practices related to quality, health and safety and environmental protection.
The production units of the group have Management Systems Certificates according to international standards, such as:
Health and Safety Management System OHSAS 18001
ISO 22000 Food Safety Management System
Operating more than 500 selling points in Greece and overseas, GOODY'S | EVEREST group renders services to over 300,000 clients on daily basis. The people of the group share the passion for innovation and commitment to the quality of products and services, always focusing on client satisfaction. The strategic objective of GOODY'S | EVEREST group is ensuring absolute satisfaction of its clients through producing safe food and rendering integrated food services, offering meals and products of high level of safety and quality.
The key points ensuring food quality and safety are as follows:
The group applies Management Systems for which it is audited and certified by independent certification bodies. In particular, it has the following certifications and has a total of 318 certificates for 2017 throughout its Network.
The specifications regarding the raw materials used remain unchanged and comply with national and European legislation. Also, the specifications of end products to be delivered to consumers remain stable, through stringent quality assurance procedures at all stages, from storage to final disposal.
Daily tests are carried out at all the group stores, at every critical control point (CCPs / OPRPs) and at all stages, from receipt of the products to their disposal. The inspections are carried out by suitably trained personnel, during every shift, ensuring a high level of quality with the aim of protecting health and safety of the final consumer. All tests results are recorded, and the required food safety system forms are also kept.
The group's production units have modern infrastructure and the most innovative equipment and are fully automated, ensuring to the highest degree the safety and quality of the products. Also, all of the Group brand stores are designed following the new trends in architecture in order to ensure a pleasant and friendly environment for the consumer and to comply with hygiene and food safety regulations.
More than 1,000 internal inspections are carried out annually. Internal inspections are carried out at stores at a fixed frequency. A team of experienced and skilled performs tests at the selling points and in the production units. The objective is to verify compliance with procedures and provisions of Food Safety and Quality Management Systems and their effectiveness. Laboratory analyzes and sampling, in chemical and microbiological parameters, are carried out both at in-house fully equipped laboratories and at externally collaborating accredited laboratories.
GOODY'S | EVEREST collaborates with the largest and most reliable producers in Europe and Greece, maintaining long-lasting relationships of trust. The suppliers with whom the group cooperates provide raw and auxiliary materials, packaging materials, merchandise, spare parts and various consumables.
The group maintains a record of approved suppliers, which lists the supplier, the product or service offered, the history of the cooperation, and the results of the supplier's assessment.
Every year over 55,000 laboratory tests are carried out on food, for the verification of hygiene rules and for cleanliness issues.
On annual basis, a team of experienced, skilled scientists trains employees occupied in the domain of food hygiene and safety in work instructions and HACCP. After the training, tests are carried out applying the success criteria.
The opinion of our consumers and our customers is very important for the group. In this context, an open communication line is maintained, so that any complaints can be handled promptly through interventions and corrective actions in all areas of operations.
The Quality Management Systems applied by the group provide the framework within which knowhow is exchanged and transferred, measurable performance indicators are used and at the same time disseminated to all the group's customer-centric perception and culture.
A review of all quality indicators is carried out annually and new data and improvement steps are defined in cooperation with all relevant departments.
The group's production units are dynamically active in a constantly expanding food industry, the production and distribution of ready meals (frozen and chilled), individual packs or bulk packaging to serve customers in hot corners of the super markets, buffet restaurants and hotel restaurants and catering events, further expanding their range of operations. Since 2016, the Protective Atmosphere method has been developed and applied to the production of meals, since the group had invested in modern equipment, special packaging and films. In the process of preparing meals in a protective atmosphere, inert gases are injected into the packaging of the product that contribute to protecting the quality and safety of the product, making it more durable.
Protection of environment constitutes priority to GOODY'S | EVEREST, since its Management's commitment. The group undertakes actions to reduce the environmental footprint in all its domains of operations, taking into consideration the environmental concerns of its stakeholders.
Based on the principles of "sustainable development", GOODY'S | EVEREST group implements and continuously improves its Environmental Management System through which it sets specific goals in order to achieve:
• reducing the consumption of natural resources and energy,
• prevention of environmental pollution by designing its operations applying the criteria pertaining to minimization, reuse and recycling of production and consumables,
GOODY'S | EVEREST has established specific monitoring and control procedures across its entire range of operations regarding:
The data arising from the measurements of the above procedures are evaluated by the Environmental Management Officer in cooperation with the relevant executives and, depending on the conclusions, the necessary preventive or corrective actions are carried out.
As climate change is a global phenomenon with significant consequences, the group is making every effort to reduce its environmental footprint. In this context, specific environmental indicators are monitored, aiming at the effective recording of the environmental performance of both production units (OLYMPIC CATERING and HELLENIC CATERING), as well as the retail outlets.
| 2016 | 2017 | |||||||
|---|---|---|---|---|---|---|---|---|
| Electricity consumption |
OLYMPIC CATERING |
HELLENIC CATERING |
CATERING STORES |
TOTAL | OLYMPIC CATERING |
HELLENIC CATERING |
CATERING STORES |
TOTAL |
| Electric energy consumption (in MWh) |
3,133.23 | 12,477.45 | 33,151.97 | 48,762.6 5 |
2,795.81 | 12,598.84 | 33,424.46 | 48,819.11 |
GOODY'S | EVEREST implements a specific gas emissions monitoring procedure, regarding the air pollution generated through the operation of:
Monitoring water consumption is carried out in a specific way and through the assessment of all relevant data on a monthly basis.
| Water consumptions in m3 |
2016 | 2017 | |||||||
|---|---|---|---|---|---|---|---|---|---|
| OLYMPIC CATERING |
HELLENIC CATERING |
CATERING STORES |
TOTAL | OLYMPIC CATERING |
HELLENIC CATERING |
CATERING STORES |
TOTAL | ||
| Water supply network |
11,790.00 | 92,187.00 | 189,522.00 | 293,499.00 | 12,596.00 | 93,608.00 | 186,170.00 | 292,374.00 |
At the production facilities of HELLENIC CATERING in Sindos and Pallini, the percentage of water discharged for biological treatment was about 52% in 2016 and about 49% in 2017 of the total amount of water used in the production process.
The group's key objective is to ensure rational management of waste resulting from the production process. To this end, every effort is made to recycle the largest proportion of waste. All waste, depending on its type, is collected in appropriate bins or in specific locations from where it is received by licensed waste management subcontractors. Solid waste is collected in suitable containers, per solid waste category in a controlled manner depending on the individual predefined alternatives, which are categorized as follows:
In particular, with regard to OLYMPIC CATERING waste, 47% of the waste generated in 2016 and 46% of the waste generated in 2017 was allocated to the appropriate structures of Athens International Airport (AIA) for recycling. The waste in question pertained to categories of plastic, paper, metal, wood and glass.
| 2016 | 2017 | ||||
|---|---|---|---|---|---|
| Waste management methods Quantities (%) |
OLYMPIC CATERING |
HELLENIC CATERING |
OLYMPIC CATERING |
HELLENIC CATERING |
|
| Recycling | 47% | 26% | 46% | 19% | |
| Landfills | 54% | 74% | 54% | 81% |
Hellenic Catering's production facilities also cooperate with licensed companies in waste recycling.
In the group's stores, recycling takes place in connection with the infrastructure of the municipality, within the administrative boundaries of which the shop operates. Employees and mainly customers are encouraged to place the waste in the special recycling bins, which are then transferred to the respective bins of the municipality. It is also noted that all the quantities of cooking oils are recycled in stores. More specifically, in 2016, 219 tones were recycled, while in 2017 - 161 tones of cooking oil.
At Goody's Burger House, corporate responsibility is an integral part of their philosophy and culture. The actions implemented by the company are distinguished for their timelessness, sensitivity and innovation. The company remains committed to supporting our troubled fellow citizens by creating alliances with organizations and activating the entire chain of affiliates, its branch network and its customers.
In 2017, ArGOODaki, the most recognized institution of social offering and love, completed its work for the 16th year, supporting the Association for the Treatment of Child Trauma by offering medical equipment to the New Babies Intensive Care Unit of the Children's Hospital "Agia Sophia" and the 1st Pediatric Clinic.
In 2017, for the second time, EVEREST participated in the "School Snacks" program of the Ministries of Labor, Social Security and Social Solidarity and Education, Research and Religious Affairs, offering traditional Thessaloniki bred rolls to approximately 11,500 students, 68
elementary schools and kindergartens. The "School Smacks" program is aimed at free distribution of healthy snacks to primary school pupils and kindergartens and seeks to address and cover nutritional needs of vulnerable groups of population, namely, school children.
EVEREST, through the initiative "School Snacks", supports a significant part of the school community. The contribution to society and especially to children is a structural element of its philosophy and a matter of primary concern for the company.
LA PASTERIA has been participating - for the 9th consecutive year- in Make A Wish Hellas program, making children's wishes come true and inviting them together with their families to La Pasteria restaurants. Make A Wish is an NGO that receives no government grants, exclusively relying on sponsorships and donations from individuals and companies. In 2017, 10 wishes came true at La Pasteria restaurants.
In addition to programs supported centrally by our group brands, our stores host and participate in actions organized locally.
• Collecting goods for flood victims in Mandra, Attica, in collaboration with NGO Ethelon and DESMO. Four stores of Flocafe Espresso Room & 5 La Pasteria stores functioned as collection points for essentials
• Supporting actions of Ethelon NGO on the International Volunteer Day
The group collaborates with organizations and other companies to support events and workshops aimed at assisting young people. Indicatively, in 2017 the group supported the following events:
Careerfair 4all ("First Career Day for Disabled People") to support people with disabilities
Mentoring by employees of the group of employees of Myrtillo Social Cafe, which almost exclusively employs people from vulnerable groups
"Offering high quality shipping transport services which exceed market expectations with passenger ferries built by the group. The group vessels are a reference point in the global shipbuilding map and upgrading the offering product with integrated travel experiences.
The focus of the "business" of the group is the sustainable development with responsibility, respect for the environment, employees, social partners as well as the continuous enhancement of product quality with personalized service to every customer of the group".
As Strategic Development Principles, the group defined the following:
ATTICA group's operations are supported by three (3) executive departments (Marine Operations Department – Financial and Commercial Department).
The project of Marine Operations Department is supported by Technical Support Department, Electrical / Electronic Support Department, Marine Operations Department and Quality Assurance & Environmental Department.
The project of Financial Department is supported by Accounting & Financial Control Department, Supplies & Logistics Department and Information Technology & Telecommunications Department.
The project of Commercial Department is supported by Hotel Operations & Customer Services, International Lines Sales Department, Domestic Lines Sales Department and Marketing Department.
Beyond the above departments, the group's operations are supported also by Legal and Corporate Department, Human Resources Department and Internal Audit Department.
ATTICA group places great emphasis on corporate responsibility issues.
Communities;
We cultivate a workplace focused on respect, equality, safety and merit as well as offer training opportunities to our employers, in order to facilitate their personal and professional development;
ATTICA group is the first company in the passenger shipping sector worldwide issued Corporate Responsibility Report based on GRI Standards guidelines of Global Reporting Initiative.
Management works daily to the consolidation of ATTICA group Responsibility performing a series of actions, of which indicatively mention:
Our business success is directly associated to our employees therefore our policy is to cultivate a workplace focused on respect, equality, safety and merit.
ATTICA group on 31/12/2017 was employing 1,018 people (1,058 people in financial year 2016) and the company 2 people (2 people in financial year 2016).
100% of our employees work with full time employment contracts and 90.5% of our ashore employees have permanent contracts. The average stay of employees in our group exceeds 14 years.
Our commitment towards meritocracy follows the principle to treat all our employees equally, which enables their professional development to depend solely on their performance and skills. In 2017, we created a Skills Assessment and Empowerment Assessment Framework in order to continuously enrich the skills and knowledge of our executives and to build the succession plan for the entire ATTICA group.
Particular focus is given on the equal treatment of women as the overall percentage of women in office and vessels is 53.2% and 5.4% respectively. Furthermore, there has been no complaints or grievances regarding human rights violations.
Our main commitment is to create a safe work environment for our marine and ashore employees. For this reason we train our employees on Health, Hygiene and Safety issues. There are no employees with high incidence or risk of disease associated with their work, while there were no occupational diseases among our employees. No employee fatal accidents occurred within 2017 while there were 14 minor injuries to our crew members.
At the same time, we invest in our people, providing real education and development opportunities to provide the best possible working and evolving conditions. In 2017, we conducted a total of 5,221 training hours with an average of training hours per office and marine employee 24.8 and 0.3 respectively. We also instituted the "Educational Job Rotation", aiming to strengthen the skills of our employees.
Within the fiscal year 2017 we:
have implemented for the 9th consecutive year a voluntary blood donation program called "Blood Ties" at our offices and vessels and gathered in total 70 blood units,
participated in the 1st No Finish Line charity race covering a total of 776 km and winning the 2nd place in our category and the 9th in the overall ranking of the 48 teams that participated,
Moreover, aiming to operate in a single culture environment and maintain a high level of quality and professionalism, we conducted Office Employee Satisfaction Survey and Ships and updated the "Business Conduct & Ethics Regulations", asking for the commitment of all our employees.
We pursue our business development bearing in mind the development of the country and of our partners and the support of local communities affected by our operations, in order to contribute to improving the quality of life and prosperity of society.
Based on the above principles during 2017:
In the context of contribution to society we pay special attention to our collaboration with our suppliers. The Group chooses its suppliers responsibly by giving priority to local suppliers and values greatly long established relationship with them.
Additionally, the group sends a questionnaire of "Quality and Environmental Assurance" to its suppliers in order to assess and record issues like: Assurance of food safety from production to consumption (ISO 22000), Development of application regarding quality assurance (ISO 9001), acknowledgment and management of environmental impact of the above (ISO 14001), Management of defective and returned products as well as procedures regarding purchases of raw materials.
Our Group acknowledges the need to select its suppliers responsibly. We acknowledge we have the moral obligation to affect in a positive way our supply chain and promote our Corporate Responsibility principles towards our suppliers, due to the fact that they heavily impact our operations.
We strive constantly to protect their safety and health and to offer them the best possible travel experience.
Based on the above during 2017 we:
compliance with regulations and voluntary codes concerning marketing and advertising;
We attempt to integrate sustainable development principles in our processes and implement environmentally sound business practices, in order to limit, as much as possible, our environmental footprint. ATTICA group follows the commitments of the United Nations Global Compact.
ATTICA group promote greater environmental responsibility. Within this context we:
Furthermore, the group manage its environmental footprint, attempts to reduce the impact on the ozone layer and the atmosphere as well as to monitor noise levels. Particularly:
Our group:
In 2017 we carried out a series of environmental footprint actions as illustratively mentioned below:
We respect the International Principles of Human Rights included, inter alia, in the International Declaration of Human Rights and the ten principles of the UN Global Compact, which we have cosigned, and the Maritime Labor Convention (MLC), according to which we are certified and tested for human rights.
Note that in 2017 there was no complaint or report for violation of human rights.
We have co-signed the European Business Manifesto 2020 (European Enterprise Manifesto 2020), part of the joint initiative "Enterprise 2020" of the Network CSR Hellas, the European Network of CSR Europe and 42 more CSR networks across Europe, which promotes cooperation and initiatives in three strategic areas:
In an effort to combat and eradicate corruption, we have accepted and signed the initiative "Call for Action" of Global Compact of the United Nations, to implement policies and practices to deal effectively with corruption. Furthermore, for a transparent version of our positions regarding public dialogues, we put forward our proposals on a national and international level either individually or through INTERFERRY organizations (International Association of Ferry Companies) and S.E.E.N. (Association of Passenger Shipping Companies)
In order to safeguard our business ethics and culture we have communicated the Business Conduct and Ethics Code (CECL) to all employees ashore via email and is included in the introductory package that we give to newcomers employees.
The CECL is binding for all employees and any non-compliance can lead to cessation of the employment relationship or even criminal penalties.
HYGEIA group undoubtedly strives to protect and promote health, in all the facets of its operations. With its vision being to be a point of reference in Greece for the provision of quality healthcare services and to continue to offer hospital services in tune with the highest standards worldwide, maintaining its leading position among international healthcare organizations, HYGEIA group aspires to continue improving and to develop innovative services for all people, with consistency and a deep sense of responsibility. HYGEIA group tries to generate value for all its stakeholders. As
reflected in the business model it has adopted, the provision of quality healthcare services is the main source of value for the organization.
We forecast the developments and potential challenges faced by the healthcare sector in advance, while we examine every investment opportunity that may arise and may contribute to achieving our vision. We forge relationships of mutual trust with our stakeholders, aiming at fostering two-way communication with them, as their opinion forms the foundation for the development of our programs.
HYGEIA group is active in the most significant area for people, health. The concepts of respect, dignity, compassion and caring constitute the foundation for every service its offers through its hospitals, while also encompassing the concept of responsibility on all its activities. The commitments and priorities set by the group are reflected in the policy it has adopted and implements:
The aim of the Corporate Responsibility framework adopted by HYGEIA group is smooth and mutually beneficial co-existence with society and all its stakeholders in general, all the while focusing on people, with a deep sense of responsibility and compassion.
HYGEIA group publishes its Corporate Responsibility Report annually. The Report is prepared based on the international GRI Standards. In this context, it has recorded in detail and prioritized its most significant issues. The procedure followed (materiality analysis) was based on the Guidelines of the Global Reporting Initiative (GRI) and the AA1000 AccountAbility Assurance Standard. It was verified by the stakeholders of the organization through a special survey conducted.
In addition, HYGEIA group has identified as stakeholders the groups of people and organizations that are directly or indirectly affected by its activities, and naturally, all the groups that may affect its operation in any way and at any time. The procedure for identifying and subsequently prioritizing the stakeholders was based on the GRI methodology and took into account both the extent of influence each category of stakeholders exercises on the Group, and the extent of influence exercised by the Group on each category of stakeholders. Given that certain factors, such as the extent and nature of the Group operations, determine the nature of these categories, different gravity is placed on each one.
The HYGEIA group stakeholders are as follows: employees, patients, patient families and visitors, shareholders, associate physicians, insurance companies, subcontracting services, vulnerable social groups and NGOs, suppliers, the state and regulatory authorities, public social insurance organizations, private customers, the Media, the medical and scientific community, as well as financial institutions.
The trust of our stakeholders is essential in ensuring the long-term success of HYGEIA group. For this reason, we pledge to cultivate open dialogue with patients, employees, customers, shareholders and all stakeholder categories, so as that there is constant communication and their needs are recorded.
The charter with the most significant issues for HYGEIA group reflects the gravity of each issue in the development of the Group, along with how important it is for its stakeholders. Significant issues are those that have a significant impact on the operation of the Group.
The assessment of the significant issues performed to prepare the 2017 Annual Report led to the development of the following charter:
The horizontal axis relates to the impact of material issues on the operation of the Company The vertical axis relates to the pressure exerted on the Company by stakeholders with regard to these issues.
HYGEIA group has identified the defining factors that contribute towards efficient management of the risks it is exposed to. In this context it has developed and implements management systems in key sectors of its activities. Specifically:
HYGEIA group has developed an integrated Risk & Emergency Management Plan to systematically and responsibly manage a wide range of internal and external adverse events that may potentially affect the smooth operation of the hospitals and/or threaten the safety of patients, visitors or the staff.
Detailed information on the financial risks of the organization is outlined in the Description of Internal Controls and Risk Management section of this Report, while information on non-financial risks is included in the following sections, per Group Corporate Responsibility axis.
HYGEIA group considers that proper implementation of the Corporate Governance Principles as pivotal, both for ensuring the sustainable development of the Group companies, but also for safeguarding and serving the legitimate interests of all Group stakeholders. HYGEIA group strives and pledges to act with integrity, always in line with the laws, regulations and internal policies in force. In this context it adopts ethical business practices and conducts its business with transparency and credibility. Bribery and any other incidents of corruption are strictly forbidden in our companies. We do not tolerate corruption, money laundering, bribery or any other immoral or illegal activity. Our performance and competitiveness are solely based on legal practices. Detailed information of Corporate Governance issues are outlined in the Statement on Corporate Governance.
The Scientific Board is the supreme scientific council of the Hospital and makes decisions on medical/scientific matters. It oversees the general terms for practicing medicine, including the code of conduct. It develops mechanisms for identifying actions to improve the quality, efficiency, safety, effectiveness and adequacy of the medical services offered; and for detecting the needs of patients and specifying programs that meet these needs. It also approves and oversees clinical trials carried out in each hospital; and undertakes to examine any scientific matter that relates to the scope and operation of the hospitals. It may submit proposals to the Board of Directors for organizing and participating in scientific meetings, inviting Greek and foreign scientists to lectures, seminars and symposiums, as well as organizing training activities for the medical and nursing staff of the hospital. It approves the rules, procedures, guidelines and all the documents that specify the operation of each hospital's Medical Service, as well as the rights and obligations of the physicians, while it guides the medical practice.
HYGEIA group's commitment to provide quality services covers both its operations and the entire
range of the services it offers. In this context, it implements an integrated Quality Improvement & Patient Safety Program that covers all the Group hospitals and administrative activities, including the services offered by the clinical labs and the diagnostic or therapeutic imaging departments.
The HYGEIA Hospital Joint Commission International (JCI) accreditation was renewed for another three-year term. To date, it remains the only hospital in Greece to have earned the Gold Seal of Approval®, the most distinguished and internationally recognized Accreditation Standard for Healthcare Organizations. Only 580 hospitals worldwide have received this accreditation. JCI is an international accreditation standard for healthcare services. Preparations for this accreditation usually last around 2 years. Once the preparation has been completed, JCI sends a team of international healthcare expert inspectors (doctors, nurses and administrative employees) to the hospital. These inspectors perform an on-site evaluation of the hospital services based on a list of over 1,000 requirements of the standard. The requirements cover the entire range of patient-centric operations within a hospital, such as accessibility, clinical assessment and care, anesthesiology and surgical care, education, and patient rights. They also encompass all support operations, such as lab and imaging services, infection prevention and control, management of medications, facility management and safety, management of patient files and clinical information, human resources management, and hospital management practices. The JCI accreditation is valid for 3 years. If a hospital wishes to maintain its accreditation, it must be reevaluated at the end of that period. JCI accredited hospitals hold the Gold Seal of Approval©.
Quality Committees have been formed for monitoring and improving clinical operations. Depending on its scope, each Committee mainly aims at studying, analyzing and providing opinions on matters concerning its area of interest. The objective of the Quality Committees is to resolve the clinical issues that may arise, while pushing services to new, even higher levels. Through the Quality Council, the Committees work closely with all the departments of each hospital to resolve any issues and improve the services offered.
Part of the daily operation of the HYGEIA group hospitals is to respond to the needs, complaints and comments of patients. These are submitted via post, email or the Feedback Form. All written remarks by patients (inpatients or outpatients), carers and visitors are received by the Corporate Quality Division and forwarded to the Management and all relevant executives for further investigation and proper corrective actions. Increasing patient and carer satisfaction is a top priority and a strong incentive for HYGEIA group, so that it may constantly improve the experience of everyone entrusting their health and the health of their loved ones to it.
Some of the questions from the patient satisfaction survey conducted in the HYGEIA group hospitals and the respective responses with rates attributed over a three-year period are listed below.
| TABLE 1: Questions from the inpatient satisfaction survey | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| HYGEIA | MITERA | HHT | LETO* | |||||||
| QUESTIONS | 2015 | 2016 | 2017 | 2015 | 2016 | 2017 | 2015 | 2016 | 2017 | 2017 |
| Overall, how would you rate the quality of care you received at our Hospital? – "Excellent and/or Very Good" |
98.0% | 97.6% | 96.8% | 93.0% | 91.80% | 92.0% | 85.5% | 90.8% | 89.43% | 97.6% |
| Would you recommend our Hospital to your family and friends? – "Yes" |
96.4% | 96.7% | 96.2% | 85.7% | 85.6% | 86.2% | 82.9% | 88.7% | 87.77% | 97.3% |
*The table only includes figures for LETO Hospital for 2017, as the Hospital introduced the Patient Satisfaction Survey in October 2016.
The satisfaction level of our patients remains very high, surpassing for yet another year the target set at 85%.
For HYGEIA group, people are its most valuable asset. All Group employees share a common vision and contribute decisively in accomplishing the business objectives, supporting the Group's leading position in the sector. The Group has adopted a people-centric approach in all its systems and practices. Despite our admittedly tough business sector, the constant diligence towards our employees and their families has led to an awarded work environment.
HYGEIA group has developed and implements a Code of Ethics for Employees, which ensures compliance to the fundamental conventions of the International Labour Organization (ILO) on labor issues. HYGEIA group recognizes how important is it to establish suitable working conditions for all the people employed in its hospitals. To this end, it has developed structures and procedures that ensure protection of labor rights and contribute to ongoing improvement of working conditions. The Group voluntarily follows and complies with the principles of the UN Global Compact.
The HYGEIA Code of Ethics and Conduct and the group hospital and company work regulation highlight our commitment to protect human rights and offer equal opportunities to all the employees. In particular:
We work towards building an environment of respect and understanding, where anyone can
openly raise and discuss their concerns with regard to ethical behavior, especially to their supervisors, without fear of reprimand or retaliation.
At HYGEIA group, human rights constitute the cornerstone of our operations, and govern all the policies, procedures and practices of human resources management. In this context, HYGEIA group defends the principles and values of human rights and forbids the recruitment and employment of people who have not reached the legal working age. It also ensures that all associated companies adopt the same policies. HYGEIA group opposes child labor and condemns all forms of forced and compulsory labor. Due to the practices and procedures followed by the Group, there are no grounds for such incidents to arise.
At HYGEIA group, no incidents, or even complaints, have been recorded or reported for any discrimination due to diversity. Furthermore, no incidents of child or forced labor, or any type of harassment have ever arisen.
In addition, HYGEIA group ensures (through written commitment/agreements) and checks that its associated suppliers (subcontracting services on Group hospitals) respect and protect human and labor rights. In this context, it plans on drawing up a special Code of Ethics for Suppliers.
HYGEIA group is committed to offering equal opportunities to all individuals, irrespective of gender, age, disability, color, race, nationality, socioeconomic status, religion or political beliefs. Promotion to managerial posts mainly depends on the needs of the companies and the individual's skills in human resources management. At HYGEIA group, minimum wage for men and women is set based on the local legislation and the collective agreements. There is no differentiation between men and women for the same type of employment. Finally, HYGEIA group employs people with disabilities wherever possible. These individuals are placed in posts suitable for their skills.
| 2017 | 2016 | ||||
|---|---|---|---|---|---|
| Ranks | Men | Women | Men | Women | |
| Directors | 24 | 27 | 21 | 23 | |
| Senior Executives (Department Supervisors) | 65 | 153 | 61 | 149 | |
| Scientific Staff | 187 | 174 | 201 | 169 | |
| Nursing Staff | 254 | 1,099 | 243 | 1,089 | |
| Administrative Staff | 395 | 741 | 378 | 734 | |
| TOTAL | 3,119 | 3,068 | |||
| Associate Physicians | 2,101 | 1,809 | 2,142 | 1,774 |
*Note that the HYGEIA group Non-Financial Information Report is prepared based on the international GRI Standards. For this reason, information on Group companies with a revenue below 5% of the total Group revenue is not included.
HYGEIA group has created more than 3,000 direct and indirect jobs in the Greek society, within a work environment marked by security, equality, stability and professional development.
Ongoing staff education and training is a key priority. The group's offering of continuous training opportunities to employees is fundamental both for its corporate success and for the personal and
professional development of its executives and employees.
An educational plan is prepared annually, which is budgeted and followed throughout the year. The plan aims to meet the needs set by the employees themselves, and educate them so as to help them meet the challenges posed by the latest technologies implemented at HYGEIA group.
In addition, the HYGEIA group hospitals organize a series of postgraduate internship programs. In this context, in partnership with the Scientific Union of HYGEIA Doctors, HYGEIA announces internships on medical specialties for new physicians twice a year, while MITERA organizes postgraduate internship programs, aiming to offer specialization to doctors and introduce them to new minimally invasive techniques in gynecology, as well as new approaches on related specialties.
At HYGEIA group, staff performance evaluation is an extremely important procedure. All the group companies apply a common Performance Management System, which forms the foundation for a uniform human resource development program and reflects the Group's position with regard to fair, objective and meritocracy-driven treatment for all employees.
Each year, 100% of the Group employees and executives are evaluated. In addition, the employees also evaluate their supervisors and managers, to foster a two-way feedback of cooperation and ongoing improvement.
Safeguarding occupational health and safety is a commitment for HYGEIA group, but also a responsibility that extends to each and every one of the employees in all business activity sectors. HYGEIA group records and monitors the Occupational Health & Safety indicators, such the Injury Rate (IR), which dropped during 2017.
The medical, nursing and administrative staff participate in the initiatives of the Group voluntarily. They donate goods, dedicate their free time and offer a warm embrace and a smile to all our fellow citizens in need. The relevant actions include collection of basic necessities for various organizations, blood drives, participation in sporting events in support of various charities and NGOs, etc.
HYGEIA group consistently develops environmental protection actions to constantly reduce its
environmental impact. The main environmental priorities for healthcare providers are proper hazardous material and waste management, reasonable use of natural resources, electricity and water, and reduced gas emissions into the atmosphere. Note that HYGEIA group is not active in protected areas with wetlands and does not pump superficial waters (e.g. rivers or lakes).
Each year we evaluate our environmental activities and services, and their impact on the environment. Based on this evaluation, we try to improve our environmental performance, by setting targets and programs, specifying indicators and monitoring our performance against the Environmental Management System we have adopted. This certification constitutes a priority for HYGEIA, which aims at operating responsibly towards the environment, both as a means to save resources and as a method of growth.
In the years 2015-2017 HYGEIA's spending on environmental protection initiatives totaled approximately €1.4m, a number which further proves our commitment to successfully manage environmental issues that are of our direct or indirect concern. This figure includes costs related to contracts with waste management companies, expenses for waste collection carts, cost of consumables as well as costs to replace equipment with environmentally friendlier ones and excludes any cost related to urban waste management.
Recognizing the significance of proper management of waste from the Group hospitals, we implement a special Hazardous Substances & Waste Management Plan. This Plan has been prepared per Group hospital and includes the procedures that must be in place for handling, storing, transporting and disposing of the hazardous substances and waste produced during the operation of the hospitals and departments. The HYGEIA group hospitals fully comply with the environmental legislation in force. Management of hazardous and non-hazardous waste for the years 2016 and 2017 is depicted below:
The quantities arising from the sterilization and incineration processes are forwarded to sanitary landfills by licensed companies, in line with the legislation.
Water consumption at the HYGEIA group facilities mainly pertains to the use of urban water. Despite this, the Group records and monitors water consumption, and is on alert to intervene in case of leakage or overconsumption of this valuable natural resource.
| HYGEIA GROUP TOTALS | 2017 | 2016 |
|---|---|---|
| Water consumption from water supply networks (m3 ) |
228,769 | 215,587 |
| Water consumption from water supply networks (lt per bed-day) | 7,716 | 7,009 |
|---|---|---|
To ensure continuous water supply, HYGEIA, MITERA and HHT have a network of reservoirs for temporary storage of water. This ensures autonomy in the water supply of their facilities in case there is an interruption to the water supply network. HYGEIA and Y-LOGIMED, have a water well, which they use exclusively to water their gardens.
The HYGEIA group hospitals consume energy from direct (natural gas and oil) and indirect energy sources (electricity). At the HYGEIA group facilities, air emissions mainly come from the operation of boilers used to heat the buildings, produce hot water and power the steam generators, as well as from the operation of the gensets. Taking into account that the boilers and steam generators run on natural gas, air emissions are low.
*Source: Attiki Gas Supply http://www.aerioattikis.gr
HYGEIA group systematically monitors the Greek and EU environmental legislation and complies with all the legal and regulatory requirements. As a result of this practice, no complaints were filed and no fines were imposed on the hospitals for environmental issues during 2017.
Contributing, showing respect and being responsible towards society are integral parts of HYGEIA group's culture and strategy. The group continues to offer to society, through a series of actions, focusing on prevention, diagnosis and treatment, with the ultimate objective to safeguard public health.
HYGEIA group has developed four main blocks of social activity, on the basis of which it sets goals and strategic priorities. These blocks include:
In 2013, we launched the Traveling for Health initiative, to serve the needs of residents in remote small islands or mountainous regions who do not enjoy easy access to medical services.
A total of 8 volunteer campaigns have been completed so far, while more than 9,834 residents have been examined and some 38,000 medical and diagnostic tests have been performed.
Apart from the Traveling for Health initiative, the Group also develops an extensive social
contribution program in the area of healthcare that includes provision of medical services, medical equipment and know-how and medical care.
Each year the group organizes public awareness campaigns, prompted by global health days, weeks and months. In the context of these campaigns, HYGEIA offers check-ups at special rates and publicly supports the vision and initiatives of social groups and organizations. In addition, the Group shares informational videos of various organizations, which are screened on TV sets located in common areas within the Group hospital premises.
Committed to advancing medical science, HYGEIA group invests in education, by organizing and implementing educational programs, seminars and events, and school visits to its hospitals. Through these actions, it offers students the opportunity to do their internship in healthcare specialties, while it also offers gives students the chance to take a tour of the Hospital and witness daily medical practice in action.
SINGULARLOGIC is one of the largest IT services and solutions companies in Greece.
Its powertrains include development and disposal of innovative business software products, design, implementation and implementation of integrated IT projects for private and public sector, as well as provision and support of products of well-known international IT firms.
SINGULARLOGIC is a member of MARFIN INVESTMENT GROUP (MIG), has a well-trained staff, specialized know-how, substantial product portfolio, a large installed base of 40,000 small and medium-sized enterprises and 700 large enterprises, a strong nationwide partner network and more than 400 important projects in the private and public sector. In particular, the business model applied to the company is presented below as follows:
| Major collaborations | Key operations | Value/ Utility | Market segment targeted by |
|---|---|---|---|
| Collaboration with established international IT firms (ERP, CRM and Retail). |
Ι. Design, planning and implementation of integrated IT solutions II. Development and distribution of business software products. III. Development and |
Development and distribution of innovative business software products, design, development and implementation of integrated IT projects for private and public sector, as well as |
the company The company offers integrated solutions in private and public sector, both in Greece and abroad. |
| distribution of applications for operation and use via mobile phone devices as well as software solutions as a subscription service. IV. Distribution and support of products of internationally established IT firms. |
provision and support of products of well-established international IT firms. Basic needs of the clients addressed by SINGULARLOGIC are as follows: |
CHANNELS The main channels through which SINGULARLOGIC comes into contact with prospective customers are: -Tenders for public sector projects |
The concise and comprehensive depiction of SINGULARLOGIC's business model includes the following:
| V. Value Added Services, | SINGULARLOGIC, through | - Exhibitions in Greece and | |
|---|---|---|---|
| Telecommunication | its high quality services, is in | abroad | |
| Organizations, Health | position to meet every need | - Recommendations from | |
| Organizations, Food and | that may arise for business | existing clientele | |
| Beverage Companies and | software products. | - Through its participation in | |
| Public Sector | major European projects. | ||
| Organizations. | - Through its associates | ||
| - Through its corporate | |||
| Cost allocation | Revenue allocation | website. | |
| Employees fees and benefits Special contracts with foreign companies on acquisition of copyrights for resale / distribution of licenses for software products Acquisition of HW and software support equipment Fees f external partners. Acquisition of software. |
SINGULARLOGIC revenue comes from providing the above services and selling HW equipment. |
SINGULARLOGIC is committed to the principles of sustainable development and socially responsible operation. In this context, strategic priorities include as follows:
SINGULARLOGIC generates value for the economy and society through its operations. The added value generated by its operations returns to a great extent to its employees, partners and the wider society. In this context, the company takes care to develop two-way communication with employees, customers, shareholders and all stakeholder groups in order to continually record and respond to their needs.
SINGULARLOGIC has identified as stakeholders/interested parties the persons or organizations/companies that may affect and/or be affected by, and/or believe that they are affected by the company's activities, such as:
Shareholders partners/system consultants
employees state and regulatory authorities
Responsible, honest and transparent communication with all stakeholders and full compliance with applicable legislation and institutional framework for fair competition is a commitment to SINGULARLOGIC and its employees in order to create and maintain relationships of trust with society and the broader business environment.
extract from the Professional Conduct Policies
SINGULARLOGIC employs skilled human resources to facilitate rendering high-quality services to its customers and partners. Maintenance and on-going development and training of its employees is a non-negotiable priority.
SINGULARLOGIC as an employer is committed to creating a safe work environment that provides a fair reward and guarantees equal opportunities for all workers, regardless of gender, ethnic origin, political beliefs, religion, sexual orientation, or other characteristic or property that is protected from national and international human rights and labor law.
The company shall not tolerate any harassment, coercion or extortion to and from its employees and is committed to respecting the fundamental principles and rights to freedom, security and employment, including the right to assemble and associate. In addition, SINGULARLOGIC will not tolerate any forced labor or illegal employment of children by any of its partners.
The company has developed and implemented the Labor Code. The Labor Code is based on the following policies:
The company has defined the framework for sound business conduct, under which all employees shall fully comply with the provisions of the Electronic Industry Coalition v4.0 (www.eicc.info) and the United Nations Global Compact businesses (http://www.unglobalcompact.org). SINGULARLOGIC human recourses within the last two years are analyzed as follows:
| 2016 | 2017 | |||||
|---|---|---|---|---|---|---|
| Human resources per gender | Men | Women | Total | Men | Women | Total |
| Total employees per gender | 404 | 181 | 585 | 366 | 171 | 537 |
| Full time | 396 | 175 | 571 | 359 | 166 | 525 |
| Seasonal | 8 | 6 | 14 | 7 | 5 | 12 |
| Human resources age allocation 2017 | ||||||||
|---|---|---|---|---|---|---|---|---|
| <30 30-50 51+ |
||||||||
| Men | 34 | 258 | 74 | |||||
| Women | 30 | 123 | 18 | |||||
| Subtotal | 64 | 381 | 92 |
100% of employees are occupied by contracts of employment with 99.5% having a full-time contract and a 0.5% part-time contract.
| 2016 | 2017 | |||||
|---|---|---|---|---|---|---|
| Employment contract | Attica | Other areas |
Total | Attica | Other areas |
Total |
| Non-fixed term contract | 522 | 49 | 571 | 477 | 48 | 525 |
| Fixed term contract | 13 | 1 | 14 | 11 | 1 | 12 |
| Total | 535 | 50 | 585 | 488 | 50 | 537 |
At SINGULARLOGIC, we aim to select executives from the labor market who share the same Vision with us, constant evolution and development of products and services that are in line with technological innovations and have a catalytic effect on changing our customers.
| Total recruitment per age allocation & Geographical location 2017 |
|||||||
|---|---|---|---|---|---|---|---|
| <30 30-50 51+ |
|||||||
| Attica | 37 | 55 | 13 | ||||
| Other areas | 1 | 7 | 2 | ||||
| Subtotal 38 62 15 |
| Recruitments /Departures | 2016 | 2017 |
|---|---|---|
| Recruitments | 174 | 115 |
| Departures (pension, end of employment contract) | 85 | 163 |
Remuneration and benefits policy has been developed in SINGULARLOGIC to attract, employ and maintain a high level of technology expertise. The remuneration of each employee reflects the educational background, experience, responsibility, but also the value / weight of the position in the labor market. In addition, depending on the hierarchical rank, the employee's past experience and the objective difficulties he may encounter (such as the need for remote work), the company offers additional benefits such as: corporate car, mileage compensation, mobile phone, portable PCs on case basis and others.
Moreover, in the context of rewarding and maintaining a high level of satisfaction for its people, the company offers health care and education activities targeting not only its employees but their families as well, such as:
Finally, a shuttle bus is provided to and from the company's premises from selected metro and suburban stations.
In the framework of the Corporate Responsibility actions organized by the company, the
participation of its employees is decisive for their success. In addition to the organization of voluntary blood donation on a yearly basis, various social actions are supported. In particular, during the year 2017, support actions were carried out by various NGOs such as:
SINGULARLOGIC invests strategically in Quality in order to maintain its competitive edge and groundbreaking position in the market by continuously improving its business operations and effectively satisfying its customers. In this context, it implements a Quality Management System (QMS) in accordance with the requirements of the International Standard on Quality ISO 9001: 2015 covering all its core activities. The strategic pillars of SINGULARLOGIC Quality System can be summarized as follows:
Documented and approved Quality Policy adopted by the company expresses the will and commitment of the company's top management in terms of Quality and Customer Service.
Moreover, SINGULARLOGIC implements the IT Service Management System in accordance with the requirements of the International Standard ISO 20000: 2011 and covers its key operations. Placing absolute priority on provision of high quality IT services, the company, through the implementation of this system, aims at:
Information Security constitutes a matter of top priority of SINGULARLOGIC to ensure its continuous and effective operation, protecting information and information systems against any threat, whether internal or external, deliberate or accidental.
SINGULARLOGIC implements Information Security Management System (ISMS) in accordance with the provisions of International Standard ISO 27001: 2013 and covers its key operations.
Information Security is the responsibility of everyone at SINGULARLOGIC.
The strategic pillars of SINGULARLOGIC Information Security Policy can be summarized as follows:
Through implementing the Information Security Management System, the company aims at the following:
SINGULARLOGIC has clearly identified and described risk areas and implemented specific processes that have been developed on the basis of the Prevention Principle.
In order to reduce the probability and the significance of the risks, the company takes preventive actions and actions. In this context, the company:
In addition, the internal audit evaluates and reviews the company's operations, aiming at improving the efficiency of risk management procedures, internal control systems and corporate governance.
The company places particular emphasis on the implementation of preventive actions on transparency and corruption issues in order to respond to the needs of stakeholders. In this context, the company has developed and implements a Professional Behavior Policy that provides clear guidelines for compliance with ethical rules within and outside the company, including in relation to suppliers and other stakeholders. The company's employment regulations clearly outline the risk areas and include specific transparency procedures developed in compliance with the Prevention Principle.
SINGULARLOGIC implements a Corporate Governance system that promotes transparency throughout the company's operations and aims at strengthening security safeguards against any kind of offending behavior.
SINGULARLOGIC selects, manages and evaluates its suppliers responsibly. Suppliers are important partners in the entire range of the company's operations.
With regard to the supplier's quantitative data, there are five categories of suppliers. The total number of suppliers is 522. Domestic suppliers are 88.7% and foreign suppliers are 11.3%.
Evaluation of suppliers constitutes an integral part of the company's effort to continually improve its products and services. An annual assessment is made to suppliers taking into account specific criteria. In particular, suppliers with environmental impact are assessed annually following the corporate procedures.
SINGULARLOGIC, as a service rendering company, does not cause a particularly heavy environmental burden through its operations. However, recognizing the importance of environmental protection for all its stakeholders, it is stepping up its efforts to record and improve its environmental performance. In this context, it has identified and recorded the most significant environmental impacts and has implemented an Environmental Management System which has been certified according to the criteria of the international ISO 14001 standard.
The objective of the Environmental Management System is to effectively manage any significant environmental aspects and impacts arising from the operation of the company in order to minimize the likelihood of pollution. In addition, the Environmental Management System ensures timely harmonization of the company's operation with the relevant environmental legislation and the continuous improvement of its environmental performance.
"The management of SINGULARLOGIC recognizes that protecting the environment and saving natural resources is an integral part of any responsible and sustainable business development. In this context, the company:
Continuously Improves the Environmental Management System in order to improve its Environmental performance by implementing appropriate procedures and programs, with specific objectives, which are reviewed and approved by the Management,
Follows, along with its main partners, good Environmental Practices to help protect the environment, including pollution prevention,
Monitors and complies with the provisions of National and European Environmental Legislation as well as the requirements and expectations of the broader operating environment in which it operates".
I. Electricity consumption (total and specific - per day)
| Electricity consumption (in KWh) |
2016* | 2017 | % | Specific electricity consumption (in KWh/ day) |
2016* | 2017 |
|---|---|---|---|---|---|---|
| Building Α | 1,137,893 | 994,541 | -12.6 | Building Α | 3,118 | 2,725 |
| Building Β | 141,669 | 130,560 | -7.8 | Building Β | 388.13 | 357.70 |
| TOTAL | 1,279,561 | 1,125,101 | -12.1 | TOTAL | 3,506 | 3,082 |
* consumption for 2016 has been calculated pro rata in the year, as the company's headquarters were changed in April 2016 and the measurements recorded were for 7 months.
| Water consumption in m3 | 2017 |
|---|---|
| Water consumption (in lt) | 1,450.4 |
| Specific water consumption (lt/day) | 3.97 |
| Waste in kg (kg) | 2016* | 2017 | Way of waste management |
|---|---|---|---|
| Paper/cardboard | 1,180 | 185 | Recycling |
| Batteries | n/a | 75 | Recycling (Portable Power Strips) |
| Electronic and electrical equipment |
1,765 | 75 | Recycling (through licensed collaborates) |
* the quantities for 2016 are very large due to the change of the company's headquarters, during which archival material was recycled and high quantities of cartons were used.
The company seeks to reduce its environmental footprint, responding to the needs and expectations of its stakeholders and the broader business environment in which it operates.
Kifissia, April 30, 2018 As and on behalf on the B.o.D.
Athanasios Papanikolaou The Chief Executive Officer
The attached financial statements were approved by the Board of Directors of MARFIN INVESTMENT GROUP HOLDINGS S.A. as of 30/04/2018 and have been published on the Company's website www.marfininvestmentgroup.com as well as on the Athens Stock Exchange's website.
The annual financial statements of the consolidated subsidiaries, as provided for by the Decision 8/754/14.4.2016 of the Board of Directors of the Hellenic Capital Market Commission, are posted on the Internet, at the address www.marfininvestmentgroup.com.
| THE GROUP | ||||
|---|---|---|---|---|
| Amounts in € '000 | Note | 01/01-31/12/2017 | 01/01-31/12/2016 | |
| Sales | 35 | 1,079,927 | 1,082,036 | |
| Cost of sales | 36 | (811,210) | (775,918) | |
| Gross profit | 268,717 | 306,118 | ||
| Administrative expenses | 36 | (94,873) | (98,871) | |
| Distribution expenses | 36 | (155,280) | (167,046) | |
| Other operating income | 37 | 37,371 | 41,053 | |
| Other operating expenses | 38 | (15,118) | (25,561) | |
| Operating profit/(loss) | 40,817 | 55,693 | ||
| Other financial results | 39 | 1,682 | (25,040) | |
| Financial expenses | 40 | (98,688) | (107,478) | |
| Financial income | 41 | 403 | 519 | |
| Income from dividends | - | 13 | ||
| Share in net gains/(losses) of companies accounted for by the equity method |
42 | (6,507) | (1,690) | |
| Losses before tax from continuing operations | (62,293) | (77,983) | ||
| Income tax | 43 | (2,027) | 2,986 | |
| Losses after tax for the year from continuing operations | (64,320) | (74,997) | ||
| Gains/(Losses) for the year from discontinued operations | 7.6 | (11,652) | (7,813) | |
| Losses after tax for the year | (75,972) | (82,810) | ||
| Attributable to: | ||||
| Owners of the parent | (74,817) | (84,877) | ||
| - from continuing operations | (66,533) | (78,048) | ||
| - from discontinued operations | (8,284) | (6,829) | ||
| Non-controlling interests | (1,155) | 2,067 | ||
| - from continuing operations | 2,213 | 3,051 | ||
| - from discontinued operations | (3,368) | (984) | ||
| Gains/(Losses) per share (€ / share) : | ||||
| Basic gains/(losses) per share | 45 | (0.0796) | (0.0904) | |
| - Basic gains/(losses) per share from continuing operations | (0.0708) | (0.0831) | ||
| - Basic gains/(losses) per share from discontinued operations | (0.0088) | (0.0073) | ||
| Diluted gains/(losses) per share | 45 | (0.0169) | (0.0422) | |
| - Diluted gains/(losses) per share from continuing operations | (0.0143) | (0.0375) | ||
| - Diluted gains/(losses) per share from discontinued operations | (0.0026) | (0.0047) |
The accompanying notes form an integral part of these Annual Separate and Consolidated Financial Statements
The items in the consolidated Income Statement for the comparative annual period ended as at 31/12/2016 have been readjusted in order to include only the non-discontinued operations. The results of the discontinued operations are discreetly presented and analyzed in separate note (see Note 7), as in compliance with the requirements of IFRS 5 "Non-current Assets Held for Sale and Discontinued Operations".
| THE COMPANY | |||||
|---|---|---|---|---|---|
| Amounts in € '000 | Note | 01/01-31/12/2017 | 01/01-31/12/2016 | ||
| Income/(Expenses) from investments in subsidiaries & investment portfolio |
39 | (43,456) | (61,263) | ||
| Income/(Expenses) from financial assets at fair value through profit or loss |
39 | 218 | 151 | ||
| Other income | 93 | 9 | |||
| Total Operating income/(expenses) | (43,145) | (61,103) | |||
| Fees and other expenses to third parties | 36 | (4,789) | (7,681) | ||
| Wages, salaries and social security costs | 36 | (4,803) | (4,460) | ||
| Depreciation and amortization | (380) | (412) | |||
| Other operating expenses | 36 | (2,892) | (4,293) | ||
| Total operating expenses | (12,864) | (16,846) | |||
| Financial income | 41 | 148 | 163 | ||
| Financial expenses | 40 | (36,149) | (39,548) | ||
| Other financial results | 39 | - | 403 | ||
| Losses before tax for the year | (92,010) | (116,931) | |||
| Income tax | - | - | |||
| Losses after tax for the year | (92,010) | (116,931) | |||
| Gains/(Losses) per share (€ / share) : | |||||
| - Basic | 45 | (0.0979) | (0.1245) | ||
| - Diluted | 45 | (0.0223) | (0.0642) |
| THE GROUP | THE COMPANY | ||||
|---|---|---|---|---|---|
| Amounts in € '000 | Note | 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 |
| Losses for the year (from continuing and discontinued operations) |
(75,972) | (82,810) | (92,010) | (116,931) | |
| Other comprehensive income: | |||||
| Amounts that will not be reclassified in the Income Statement in subsequent years |
|||||
| Remeasurement of defined benefit pension plans | (1,029) | (750) | (23) | (16) | |
| Deferred tax on revaluation of accrued pensions | 46 | 255 | 208 | - | - |
| (774) | (542) | (23) | (16) | ||
| Amounts that may be reclassified in the Income Statement in subsequent years |
|||||
| Cash flow hedging : | |||||
| - current year gains/(losses) | 1,156 | 3,881 | - | - | |
| - reclassification to profit or loss for the year | (952) | 1,245 | - | - | |
| Available-for-sale financial assets : | |||||
| - current year gains/(losses) | 7 | 8 | - | - | |
| Exchange differences on translating foreign operations |
146 | 154 | - | - | |
| Exchange gain/(loss) on disposal of foreign operations reclassified in profit or loss for the year Share of other comprehensive income of equity accounted investments : |
2,368 | - | - | - | |
| - reclassification to profit or loss for the year | - | 77 | - | - | |
| 2,725 | 5,365 | - | - | ||
| Other comprehensive income for the year after tax |
46 | 1,951 | 4,823 | (23) | (16) |
| Total comprehensive income for the year after tax |
(74,021) | (77,987) | (92,033) | (116,947) | |
| Attributable to: | |||||
| Owners of the parent | (73,567) | (80,596) | |||
| Non-controlling interests | (454) | 2,609 |
| THE GROUP | THE COMPANY | |||||
|---|---|---|---|---|---|---|
| Amounts in € '000 | Note | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | |
| ASSETS | ||||||
| Non-Current Assets | ||||||
| Tangible assets | 9 | 1,065,215 | 1,133,786 | 560 | 945 | |
| Goodwill | 10 | 240,738 | 237,773 | - | - | |
| Intangible assets | 11 | 425,231 | 434,206 | 2 | 5 | |
| Investments in subsidiaries | 12 | - | - | 1,096,579 | 1,174,147 | |
| Investments in associates | 13 | 17,119 | 59,342 | - | - | |
| Investment portfolio | 14 | 5,353 | 471 | - | - | |
| Property investments | 15 | 265,878 | 275,225 | - | - | |
| Other non-current assets | 16 | 14,365 | 15,318 | 181,301 | 193,099 | |
| Deferred tax asset | 17 | 37,625 | 40,024 | - | - | |
| Total | 2,071,524 | 2,196,145 | 1,278,442 | 1,368,196 | ||
| Current Assets | ||||||
| Inventories | 18 | 75,882 | 67,572 | - | - | |
| Trade and other receivables | 19 | 220,412 | 228,423 | - | - | |
| Other current assets | 20 | 69,196 | 71,656 | 6,019 | 13,272 | |
| Trading portfolio and other financial assets at fair value through P&L |
21 | 437 | 2,867 | 367 | 815 | |
| Derivative financial instruments | 29 | 4,433 | 5,877 | - | - | |
| Cash, cash equivalents & restricted cash | 22 | 130,507 | 142,900 | 9,554 | 10,197 | |
| Total | 500,867 | 519,295 | 15,940 | 24,284 | ||
| Non-current assets classified as held for sale | 7.3 | 27,359 | - | - | - | |
| Total Assets | 2,599,750 | 2,715,440 | 1,294,382 | 1,392,480 | ||
| EQUITY AND LIABILITIES | ||||||
| Equity | ||||||
| Share capital | 23 | 281,853 | 281,853 | 281,853 | 281,853 | |
| Share premium | 23 | 3,874,689 | 3,874,689 | 3,874,689 | 3,874,689 | |
| Fair value reserves | 24 | 2,273 | 2,085 | - | - | |
| Other reserves | 24 | 32,752 | 33,781 | 32,948 | 35,731 | |
| Retained earnings | (3,952,499) | (3,879,448) | (3,615,428) | (3,526,178) | ||
| Equity attributable to οwners of the parent | 239,068 | 312,960 | 574,062 | 666,095 | ||
| Non-controlling interests | 111,099 | 116,050 | - | - | ||
| Total Equity | 350,167 | 429,010 | 574,062 | 666,095 | ||
| Non-current liabilities | ||||||
| Deferred tax liability | 17 | 189,182 | 195,810 | - | - | |
| Accrued pension and retirement obligations | 25 | 35,765 | 34,635 | 209 | 184 | |
| Government grants | 26 | 6,946 | 7,721 | - | - | |
| Long-term borrowings | 27 | 980,893 | 855,987 | 623,950 | 597,144 | |
| Non-Current Provisions | 30 | 13,361 | 16,520 | - | - | |
| Other long-term liabilities | 31 | 6,445 | 11,759 | 4,955 | 9,514 | |
| Total | 1,232,592 | 1,122,432 | 629,114 | 606,842 | ||
| Current Liabilities | ||||||
| Trade and other payables | 32 | 170,148 | 180,608 | - | - | |
| Tax payable | 33 | 1,479 | 2,331 | - | - | |
| Short-term borrowings | 27 | 643,410 | 818,495 | 75,572 | 106,895 | |
| Current provisions | 30 | 475 | 443 | - | - | |
| Other current liabilities | 34 | 174,120 | 162,121 | 15,634 | 12,648 | |
| Total | 989,632 | 1,163,998 | 91,206 | 119,543 | ||
| Liabilities directly associated with non-current assets | 7.3 | 27,359 | - | - | - | |
| classified as held for sale | ||||||
| Total liabilities | 2,249,583 | 2,286,430 | 720,320 | 726,385 | ||
| Total Equity and Liabilities | 2,599,750 | 2,715,440 | 1,294,382 | 1,392,480 |
| Amounts in € '000 | Note | Number of Shares |
Share Capital |
Share Premium |
Fair Value Reserve |
Other Reserves |
Retained earnings |
Total Equity attribut. to Owners of the Parent |
Non controlling Interests |
Total Equity |
|---|---|---|---|---|---|---|---|---|---|---|
| Balance as of 01/01/2017 | 939,510,748 | 281,853 | 3,874,689 | 2,085 | 33,781 | (3,879,448) | 312,960 | 116,050 | 429,010 | |
| Convertible bond loan reserve | - | - | - | - | (2,783) | 2,783 | - | - | - | |
| Issue of share capital | - | - | - | - | - | - | - | 160 | 160 | |
| Non-controlling interests due to purchase of subsidiaries |
- | - | - | - | - | - | - | (2) | (2) | |
| Change increase/(decrease) of non controlling interests in subsidiaries |
- | - | - | - | - | (325) | (325) | (2,208) | (2,533) | |
| Dividends to non-controlling interests of subsidiaries |
- | - | - | - | - | - | - | (2,447) | (2,447) | |
| Transactions with owners | - | - | - | - | (2,783) | 2,458 | (325) | (4,497) | (4,822) | |
| Profit/(Loss) for the year | - | - | - | - | - | (74,817) | (74,817) | (1,155) | (75,972) | |
| Other comprehensive income: | ||||||||||
| Cash flow hedges | ||||||||||
| - current year gains/(losses) | - | - | - | 1,033 | - | - | 1,033 | 123 | 1,156 | |
| - reclassification to profit or loss for the year |
- | - | - | (851) | - | - | (851) | (101) | (952) | |
| Available-for-sale financial assets | ||||||||||
| - current year gains/(losses) | - | - | - | 6 | - | - | 6 | 1 | 7 | |
| Exchange differences on translation of foreign operations |
- | - | - | - | 102 | - | 102 | 44 | 146 | |
| Exchange losses on disposal of foreign operations reclassified in profit or loss for the year |
- | - | - | - | 1,652 | - | 1,652 | 716 | 2,368 | |
| Remeasurements of defined benefit pension plans |
- | - | - | - | - | (920) | (920) | (109) | (1,029) | |
| Deferred tax on revaluation of accrued pensions |
46 | - | - | - | - | - | 228 | 228 | 27 | 255 |
| Other comprehensive income for the year after tax |
46 | - | - | - | 188 | 1,754 | (692) | 1,250 | 701 | 1,951 |
| Total comprehensive income for the year after tax |
- | - | - | 188 | 1,754 | (75,509) | (73,567) | (454) | (74,021) | |
| Balance as of 31/12/2017 | 939,510,748 | 281,853 | 3,874,689 | 2,273 | 32,752 | (3,952,499) | 239,068 | 111,099 | 350,167 |
| Amounts in € '000 | Note | Number of Shares |
Share Capital |
Share Premium |
Fair Value Reserve |
Other Reserves |
Retained earnings |
Total Equity attribut. to Owners of the Parent |
Non controlling Interests |
Total Equity |
|---|---|---|---|---|---|---|---|---|---|---|
| Βalance as of 01/01/2016 | 939,385,586 | 281,816 | 3,874,659 | (2,581) | 33,674 | (3,793,674) | 393,894 | 114,506 | 508,400 | |
| Share capital increase through conversion of convertible bonds |
125,162 | 37 | 30 | - | (1) | 1 | 67 | - | 67 | |
| Non-controlling interests due to purchase of subsidiaries |
- | - | - | - | - | - | - | 412 | 412 | |
| Change increase/(decrease) of non controlling interests in subsidiaries |
- | - | - | - | - | (405) | (405) | 418 | 13 | |
| Dividends to owners of non controlling interests of subsidiaries |
- | - | - | - | - | - | - | (1,738) | (1,738) | |
| Decrease in non-controlling interests due to sale of subsidiaries |
- | - | - | - | - | - | - | (29) | (29) | |
| Share capital decrease by share capital return to non-controlling interests |
- | - | - | - | - | - | - | (128) | (128) | |
| Transactions with owners | 125,162 | 37 | 30 | - | (1) | (404) | (338) | (1,065) | (1,403) | |
| Profit/(Loss) for the year | - | - | - | - | - | (84,877) | (84,877) | 2,067 | (82,810) | |
| Other comprehensive income: | ||||||||||
| Cash flow hedges | ||||||||||
| - current year gains/(losses) | - | - | - | 3,469 | - | - | 3,469 | 412 | 3,881 | |
| - reclassification to profit or loss for the year |
- | - | - | 1,113 | - | - | 1,113 | 132 | 1,245 | |
| Available-for-sale financial assets | ||||||||||
| - current year gains/(losses) | - | - | - | 7 | - | - | 7 | 1 | 8 | |
| Exchange differences on translation of foreign operations |
- | - | - | - | 108 | - | 108 | 46 | 154 | |
| Remeasurements of defined benefit pension plans |
- | - | - | - | - | (683) | (683) | (67) | (750) | |
| Share of other comprehensive income of equity accounted investments |
||||||||||
| - reclassification to profit or loss for the year |
- | - | - | 77 | - | - | 77 | - | 77 | |
| Deferred tax on revaluation of accrued pensions |
46 | - | - | - | - | - | 190 | 190 | 18 | 208 |
| Other comprehensive income for the year after tax |
46 | - | - | - | 4,666 | 108 | (493) | 4,281 | 542 | 4,823 |
| Total comprehensive income for the year after tax |
- | - | - | 4,666 | 108 | (85,370) | (80,596) | 2,609 | (77,987) | |
| Balance as of 31/12/2016 | 939,510,748 | 281,853 | 3,874,689 | 2,085 | 33,781 | (3,879,448) | 312,960 | 116,050 | 429,010 |
| Amounts in € '000 | Note | Number of Shares |
Share Capital |
Share Premium |
Other Reserves |
Retained earnings |
Total Equity |
|---|---|---|---|---|---|---|---|
| Balance as of 01/01/2017 | 939,510,748 | 281,853 | 3,874,689 | 35,731 | (3,526,178) | 666,095 | |
| Convertible bond loan reserve | - | - | - | (2,783) | 2,783 | - | |
| Transactions with owners | - | - | - | (2,783) | 2,783 | - | |
| Profit/(Loss) for the year | - | - | - | - | (92,010) | (92,010) | |
| Other comprehensive income: | |||||||
| Remeasurements of defined benefit pension plans | - | - | - | - | (23) | (23) | |
| Other comprehensive income for the year after tax | 46 | - | - | - | - | (23) | (23) |
| Total comprehensive income for the year after tax | - | - | - | - | (92,033) | (92,033) | |
| Balance as of 31/12/2017 | 939,510,748 | 281,853 | 3,874,689 | 32,948 | (3,615,428) | 574,062 |
The accompanying notes form an integral part of these Annual Separate and Consolidated Financial Statements
| Amounts in € '000 | Note | Number of Shares |
Share Capital |
Share Premium |
Other Reserves |
Retained earnings |
Total Equity |
|---|---|---|---|---|---|---|---|
| Βalance as of 01/01/2016 | 939,385,586 | 281,816 | 3,874,659 | 35,732 | (3,409,232) | 782,975 | |
| Share capital increase through conversion of convertible bonds | 125,162 | 37 | 30 | (1) | 1 | 67 | |
| Transactions with owners | 125,162 | 37 | 30 | (1) | 1 | 67 | |
| Profit/(Loss) for the year | - | - | - | - | (116,931) | (116,931) | |
| Other comprehensive income: | |||||||
| Remeasurements of defined benefit pension plans | - | - | - | - | (16) | (16) | |
| Other comprehensive income for the year after tax | 46 | - | - | - | - | (16) | (16) |
| Total comprehensive income for the year after tax | - | - | - | - | (116,947) | (116,947) | |
| Balance as of 31/12/2016 | 939,510,748 | 281,853 | 3,874,689 | 35,731 | (3,526,178) | 666,095 |
| THE GROUP | THE COMPANY | ||||
|---|---|---|---|---|---|
| Amounts in € '000 | 01/01- 31/12/2017 |
01/01- 31/12/2016 |
01/01- 31/12/2017 |
01/01- 31/12/2016 |
|
| Losses for the year before tax from continuing operations | (62,293) | (77,983) | (92,010) | (116,931) | |
| Adjustments | 191,064 | 239,902 | 79,807 | 100,617 | |
| Cash flows from operating activities before working capital changes | 128,771 | 161,919 | (12,203) | (16,314) | |
| Changes in working capital | |||||
| (Increase) / Decrease in inventories | (8,964) | (8,932) | - | - | |
| (Increase)/Decrease in trade receivables | (14,019) | (15,277) | (515) | 146 | |
| Increase / (Decrease) in liabilities | (11,161) | (15,630) | (2,513) | 2,316 | |
| (Increase)/Decrease of trading portfolio | - | - | 446 | (98) | |
| (34,144) | (39,839) | (2,582) | 2,364 | ||
| Cash flows from operating activities | 94,627 | 122,080 | (14,785) | (13,950) | |
| Interest paid | (71,483) | (83,201) | (33,572) | (42,318) | |
| Income tax paid | (8,048) | (7,603) | - | - | |
| Net cash flows from operating activities from continuing operations | 15,096 | 31,276 | (48,357) | (56,268) | |
| Net cash flows from operating activities of discontinued operations | 830 | 890 | - | - | |
| Net cash flows from operating activities | 15,926 | 32,166 | (48,357) | (56,268) | |
| Cash flows from investing activities | |||||
| Purchase of property, plant and equipment | (29,322) | (29,463) | (7) | (53) | |
| Purchase of intangible assets | (4,988) | (4,668) | - | - | |
| Purchase of investment property | (1,696) | (2,765) | - | - | |
| Disposal of property, plant and equipment, intangible assets and investment property |
2,550 | 893 | 51 | 25 | |
| Return of advance for subsidiary's SCI | - | - | - | 13,000 | |
| Dividends received | - | 17 | - | - | |
| Ιnvestments in trading portfolio and financial assets at fair value through profit and loss |
2,659 | 1,219 | - | - | |
| Investments in subsidiaries and associates | 54,593 | 8,327 | 56,920 | 25,646 | |
| Investments on financial assets of investment portfolio | (3,872) | - | - | - | |
| Change in non-current assets | - | (7,000) | - | - | |
| Interest received | 399 | 714 | 125 | 163 | |
| Loans to related parties | - | (75) | (1,500) | - | |
| Grants received | 68 | 2,757 | - | - | |
| Net cash flow from investing activities from continuing operations | 20,391 | (30,044) | 55,589 | 38,781 | |
| Net cash flow from investing activities of discontinued operations | (512) | (1,138) | - | - | |
| Net cash flow from investing activities | 19,879 | (31,182) | 55,589 | 38,781 | |
| Cash flow from financing activities | |||||
| Proceeds from issuance of ordinary shares of subsidiary | 160 | 72 | - | - | |
| Proceeds from borrowings | 478,185 | 69,233 | 469,900 | 25,759 | |
| Payments for borrowings | (521,039) | (100,554) | (477,770) | (13,000) | |
| Changes in ownership interests in existing subsidiaries | (2,024) | (304) | - | - | |
| Payments for share capital decrease to non-controlling interests of subsidiaries | - | (128) | - | - | |
| Dividends paid to non-controlling interests | (1,799) | (3,043) | - | - | |
| Payment of finance lease liabilities | (1,381) | (1,063) | - | - | |
| Net cash flow from financing activities from continuing operations | (47,898) | (35,787) | (7,870) | 12,759 | |
| Net cash flow from financing activities of discontinued operations | (120) | 249 | - | - | |
| Net cash flow from financing activities | (48,018) | (35,538) | (7,870) | 12,759 | |
| Net (decrease) / increase in cash, cash equivalents and restricted cash | (12,213) | (34,554) | (638) | (4,728) | |
| Cash, cash equivalents and restricted cash at the beginning of the year Exchange differences in cash, cash equivalents and restricted cash from continuing |
142,900 | 177,553 | 10,197 | 14,915 | |
| operations Exchange differences in cash, cash equivalents and restricted cash from |
(31) | (163) | (5) | 10 | |
| discontinued operations | (80) | 64 | - | - | |
| Net cash, cash equivalents and restricted cash at the end of the year | 130,576 | 142,900 | 9,554 | 10,197 |
| THE GROUP | THE COMPANY | ||||
|---|---|---|---|---|---|
| Amounts in € '000 | 01/01- 31/12/2017 |
01/01- 31/12/2016 |
01/01- 31/12/2017 |
01/01- 31/12/2016 |
|
| Adjustments for: | |||||
| Depreciation and amortization expense | 76,939 | 76,478 | 379 | 411 | |
| Changes in pension obligations | 2,370 | 2,771 | 26 | 25 | |
| Provisions | 7,260 | 32,406 | - | - | |
| Impairment of assets | 4,041 | 36,707 | 43,146 | 61,677 | |
| Profits from reversal of impairment of assets | (5,326) | (17,526) | - | (414) | |
| (Profit) / loss from investment property at fair value | 10,942 | 7,277 | - | - | |
| Unrealized exchange (gains)/losses | 119 | 189 | 8 | (43) | |
| (Profit) loss on sale of property, plant and equipment, intangible assets and investment property |
30 | (394) | (42) | (2) | |
| (Profit) / loss from fair value valuation of financial assets at fair value through profit and loss and trading portfolio |
(1,505) | 3,539 | - | 8 | |
| Share in net (profit) / loss of companies accounted for by the equity method | 6,507 | 1,690 | - | - | |
| (Profit) / loss from sale of financial assets at fair value through profit and loss and trading portfolio |
931 | 2,518 | - | - | |
| (Profit) / loss from disposal of a shareholding in subsidiaries/associates | 8 | (44) | 310 | - | |
| Interest and similar income | (378) | (498) | (148) | (163) | |
| Interest and similar expenses | 98,032 | 106,746 | 36,146 | 39,544 | |
| Income from dividends | - | (13) | - | - | |
| Grants amortization | (843) | (871) | - | - | |
| Income from reversal of prior year's provisions | (6,401) | (9,620) | - | - | |
| Non-cash (income)/expenses | (1,662) | (1,453) | (18) | (426) | |
| Total | 191,064 | 239,902 | 79,807 | 100,617 |
The accompanying notes form an integral part of these Annual Separate and Consolidated Financial Statements
The amounts of the comparative year ended on 31/12/2016 have been readjusted in order to include only the continuing operations. The results of the discontinued operations are distinctly presented and analyzed in a separate note (see Note 7), in compliance with the requirements of IFRS 5.
Reconciliation of cash and cash equivalent in the Statement of Cash Flows with the corresponding items in the Statement of Financial Position is as follows:
| Note | 31/12/2017 | 31/12/2016 | |
|---|---|---|---|
| Cash, cash equivalents and restricted cash of Financial Statements | 22 | 130,507 | 142,900 |
| Cash, cash equivalents and restricted cash of disposal groups classified as held for sale |
7.6 | 69 | - |
| Total cash, cash equivalents and restricted cash at consolidated cash flow statement |
130,576 | 142,900 |
The Group Financial Statements have been prepared in compliance with the International Financial Reporting Standards as issued by the International Accounting Standards Board and adopted by the European Union.
The Company "MARFIN INVESTMENT GROUP HOLDINGS S.A." under the discreet title "MARFIN INVESTMENT GROUP" ("MIG") is domiciled in Greece in the Municipality of Kifissia of Attica. The Company's term of duration is 100 years starting from its establishment and can be extended following a resolution of the General Shareholders Meeting.
MIG operates as a holding societe anonyme according to Greek legislation and specifically according to the provisions of C.L. 2190/1920 on societe anonymes, as it stands. The Financial Statements are posted on the Company's website at www.marfininvestmentgroup.com. The Company's shares are listed in the Athens Stock Exchange. The Company's stock is included in the ASE General Index (Bloomberg Ticker: MIG GA, Reuters ticker: MIGr.AT, OASIS: MIG).
The main activity of the Group is focused on buyouts and equity investments in Greece, Cyprus and the wider South-Eastern Europe area. Following its disinvestment from the banking sector in 2007 and several mergers and acquisitions, the Group's activities focus on 6 operating sectors:
On December 31, 2017 the Group's headcount amounted to 10,308 (568 pertaining to discontinued opertaions), while on December 31, 2016 the Group's headcount amounted to 10,347 (594 pertaining to discontinued opertaions). On December 31, 2017 and 2016 the Company's headcount amounted to 38 and 44 respectively.
MIG's companies, included in the consolidated Financial Statements, as well as their non-tax audited years are analysed in Note 2 of the Financial Statements.
The attached Financial Statements for the financial year ending 31/12/2017 were approved by the Company's Board of Directors on April 30, 2018 and are subject to the final approval of the Annual Ordinary General Shareholder Meeting. The financial statements are available to the investing public at the Company's head office (67 Thisseos Ave., 146 71 Kifissia, Greece) and on the Company's website.
Consolidated Financial Statements of MIG Group are consolidated under the equity method, in the Financial Statements of PIRAEUS BANK S.A., which is domiciled in Greece and whose holding in the Company amounts to 31.19% as of 31/12/2017.
The Group's structure on 31/12/2017 is as follows:
The following table presents MIG's consolidated entities on 31/12/2017, their domiciles, their principal activity, the Company's direct and indirect shareholdings, the consolidation method as well as the non-tax audited financial years.
| Company Name | Domicile | Principal activity |
Direct % |
Indirect % |
Total % | Consolidation Method |
Non-tax Audited Years (5) |
|---|---|---|---|---|---|---|---|
| MARFIN INVESTMENT GROUP HOLDINGS S.A. |
Greece | Holding company |
Parent Company | 2012-2017 | |||
| MIG Subsidiaries | |||||||
| MARFIN CAPITAL S.A. | BVI (4) | Holding company |
100.00% | - | 100.00% | Purchase Method |
- (1) |
| VIVARTIA HOLDINGS S.A. | Greece | Holding company |
92.08% | - | 92.08% | Purchase Method |
2009-2017 |
| MIG LEISURE LTD | Cyprus | Management of investments |
100.00% | - | 100.00% | Purchase Method |
- |
| MIG SHIPPING S.A. | BVI (4) | Holding company |
100.00% | - | 100.00% | Purchase Method |
- (1) |
| MIG REAL ESTATE (SERBIA) B.V. | Holland | Management of investments |
100.00% | - | 100.00% | Purchase Method |
- |
| MIG LEISURE & REAL ESTATE CROATIA B.V. |
Holland | Management of investments |
100.00% | - | 100.00% | Purchase Method |
- |
| SINGULARLOGIC S.A. | Greece | IT systems and software applications |
63.20% | 22.50% | 85.70% | Purchase Method |
2008-2017 |
| ATHENIAN ENGINEERING S.A. | Greece | Aircraft maintenance and repairs |
100.00% | - | 100.00% | Purchase Method |
2009-2017 |
| MIG AVIATION HOLDINGS LTD | Cyprus | Holding company |
100.00% | - | 100.00% | Purchase Method |
- |
| TOWER TECHNOLOGY LTD | Cyprus | Holding company |
100.00% | - | 100.00% | Purchase Method |
- |
| MIG ENVIRONMENT HOLDINGS & INVESTMENTS S.A. |
Greece | Holding company |
100.00% | - | 100.00% | Purchase Method |
2011-2017 |
| MIG MEDIA S.A. | Greece | Advertising services |
100.00% | - | 100.00% | Purchase Method |
2012-2017 |
| MIG LEISURE LTD Subsidiary CYPRUS TOURISM DEVELOPMENT PUBLIC COMPANY LTD |
Cyprus | Hotel management |
- | 75.08% | 75.08% | Purchase Method |
- |
| MIG SHIPPING S.A. Subsidiary | |||||||
| ATTICA HOLDINGS S.A. | Greece | Holding company |
11.60% | 77.78% | 89.38% | Purchase Method |
2009-2017 |
| MARFIN CAPITAL S.A. Subsidiary | |||||||
| HYGEIA S.A. | Greece | Primary and secondary healthcare services |
32.76% | 37.62% | 70.38% | Purchase Method |
2011 & 2013- 2017 |
| MIG REAL ESTATE (SERBIA) B.V. Subsidiary |
|||||||
| JSC ROBNE KUCE BEOGRAD (RKB) | Serbia | Real estate management |
- | 83.10% | 83.10% | Purchase Method |
- |
| MIG AVIATION HOLDINGS LTD Subsidiaries |
|||||||
| MIG AVIATION 1 LTD | Cyprus | Helicopter management |
- | 100.00% | 100.00% | Purchase Method |
- |
| MIG AVIATION 2 LTD | Cyprus | Dormant | - | 100.00% | 100.00% | Purchase Method |
- |
| VIVARTIA GROUP | |||||||
| VIVARTIA HOLDINGS S.A. Subsidiaries | |||||||
| DELTA FOODS S.A. (former DESMOS DEVELOPMENT S.A) |
Greece | Production & distribution of dairy products |
- | 92.08% | 92.08% | Purchase Method |
2010-2017 |
| GOODY'S S.A. (former INVESTAL RESTAURANTS S.A.) |
Greece | Holding company |
- | 91.44% | 91.44% | Purchase Method |
2010-2017 |
| BARBA STATHIS S.A. (former CAFE ALKYONI S.A) |
Greece | Production & distribution of frozen foods |
- | 92.08% | 92.08% | Purchase Method |
2010-2017 |
| Company Name | Domicile | Principal activity |
Direct % |
Indirect % |
Total % | Consolidation Method |
Non-tax Audited Years (5) |
|---|---|---|---|---|---|---|---|
| DELTA S.A. Subsidiaries | |||||||
| EUROFEED HELLAS S.A | Greece | Production & distribution of animal feed |
- | 92.08% | 92.08% | Purchase Method |
2010-2017 |
| UNITED MILK HOLDINGS LTD | Cyprus | Production & distribution of dairy products |
- | 92.08% | 92.08% | Purchase Method |
- |
| UNITED MILK COMPANY AD | Bulgaria | Holding company |
- | 92.08% | 92.08% | Purchase Method |
- |
| GOODY'S S.A. (former INVESTAL RESTAURANTS S.A.) |
Greece | Holding company |
- | 0.55% | 0.55% | Purchase Method |
2010-2017 |
| GOODY'S S.A. Subsidiaries | |||||||
| BALKAN RESTAURANTS S.A. | Bulgaria | Café-patisserie | - | 92.08% | 92.08% | Purchase Method |
- |
| HELLENIC CATERING S.A. | Greece | Food industry | - | 90.26% | 90.26% | Purchase Method |
2010-2017 |
| HELLENIC FOOD INVESTMENTS S.A. | Greece | Holding company |
- | 56.46% | 56.46% | Purchase Method |
2010-2017 |
| ATHENAIKA CAFE-PATISSERIES S.A. | Greece | Café-patisserie | - | 92.08% | 92.08% | Purchase | 2010-2017 |
| Restaurants - | Method Purchase |
||||||
| EFKARPIA RESTAURANTS S.A. | Greece | Café patisseries |
- | 46.96% | 46.96% | Method | 2010-2017 |
| EASTERN CRETE RESTAURANTS PATISSERIES S.A. |
Greece | Restaurants - Café patisseries |
- | 55.25% | 55.25% | Purchase Method |
2010-2017 |
| TEMBI CAFE-PATISSERIES S.A. | Greece | Restaurants - Café patisseries |
- | 56.40% | 56.40% | Purchase Method |
2010-2017 |
| KAVALA RESTAURANTS S.A. | Greece | Restaurants - Café patisseries |
- | 46.96% | 46.96% | Purchase Method |
2008-2017 |
| MALIAKOS RESTAURANTS S.A. | Greece | Restaurants - Café patisseries |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| HARILAOU RESTAURANTS S.A. | Greece | Restaurants - Café patisseries |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| VERIA CAFÉ - PATISSERIES S.A. | Greece | Café-patisserie | - | 89.61% | 89.61% | Purchase Method |
2010-2017 |
| WHITE MOUNTAIN S.A. (former NAFPLIOS S.A.) |
Greece | Café-patisserie | - | 41.59% | 41.59% | Purchase Method |
2010-2017 |
| ARMA INVESTMENTS S.A. | Greece | Restaurants - Café patisseries |
- | 47.42% | 47.42% | Purchase Method |
2010-2017 |
| EVEREST S.A. HOLDING & INVESTMENTS | Greece | Holding company |
- | 92.08% | 92.08% | Purchase Method |
2010-2017 |
| W FOOD SERVICES S.A. | Greece | Café-patisserie | - | 89.48% | 89.48% | Purchase Method |
2010-2017 |
| PALLINI RESTAURANTS S.A. | Greece | Restaurants - Café patisseries |
- | 91.29% | 91.29% | Purchase Method |
2009-2017 |
| ALMIROU VOLOS RESTAURANTS PATISSERIES TRADING COMPANIES S.A. |
Greece | Restaurants - Café patisseries |
- | 52.57% | 52.57% | Purchase Method |
2011-2017 |
| GEFSIPLOIA S.A. (former GLYFADA RESTAURANTS - PATISSERIES S.A.) |
Greece | Restaurants - Café patisseries |
- | 91.76% | 91.76% | Purchase Method |
2010-2017 |
| PELASGIANS P.C. | Greece | Restaurants - Café patisseries |
- | 46.96% | 46.96% | Purchase Method |
2016-2017 |
| HELLENIC FOOD INVESTMENTS S.A. Subsidiaries | |||||||
| HOLLYWOOD RESTAURANTS - PATISSERIES S.A. |
Greece | Restaurants - Café patisseries |
- | 54.61% | 54.61% | Purchase Method |
2010-2017 |
| ZEFXI RESTAURANTS - PATISSERIES S.A. | Greece | Restaurants - Café patisseries |
- | 54.84% | 54.84% | Purchase Method |
2010-2017 |
| PATRA RESTAURANTS S.A. | Greece | Café-patisserie | - | 42.35% | 42.35% | Purchase Method |
2010-2017 |
| CORINTHOS RESTAURANTS PATISSERIES TRADING COMPANIES S.A. |
Greece | Restaurants - Café patisseries |
- | 39.52% | 39.52% | Purchase Method |
2010-2017 |
| METRO VOULIAGMENIS S.A. | Greece | Café-patisserie | - | 35.76% | 35.76% | Purchase Method |
2010-2017 |
| Company Name | Domicile | Principal activity |
Direct % |
Indirect % |
Total % | Consolidation Method |
Non-tax Audited Years (5) |
|---|---|---|---|---|---|---|---|
| BARBA STATHIS S.A. Subsidiaries | |||||||
| UNCLE STATHIS EOD | Bulgaria | Production and distribution of frozen vegetables & food |
- | 92.08% | 92.08% | Purchase Method |
- |
| ALESIS S.A. | Greece | Wholesale standardized confectionery |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| M. ARABATZIS S.A. | Greece | Bakery & Confectionery products |
- | 45.12% | 45.12% | Purchase Method |
2008-2017 |
| GOODY'S S.A. (former INVESTAL RESTAURANTS S.A.) |
Greece | Holding company |
- | 0.09% | 0.09% | Purchase Method |
2010-2017 |
| EVEREST HOLDINGS & INVESTMENTS S.A. Subsidiaries | |||||||
| OLYMPIC CATERING S.A. | Greece | Catering services |
- | 91.12% | 91.12% | Purchase Method |
2010-2017 |
| PASTERIA S.A. CATERING INVESTMENTS & PARTICIPATIONS |
Greece | Holding company |
- | 91.57% | 91.57% | Purchase Method |
2010-2017 |
| TROFI S.A. | Greece | Beverage & Fast food services |
- | 73.66% | 73.66% | Purchase Method |
2010-2017 |
| PERISTERI S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| KORIFI S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2008-2017 |
| DEKAEKSI S.A. | Greece | Beverage & Fast food services |
- | 56.17% | 56.17% | Purchase Method |
2010-2017 |
| IMITTOU S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| KAMARA S.A. | Greece | Beverage & Fast food services |
- | 80.59% | 80.59% | Purchase Method |
2010-2017 |
| KALLITHEA S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| PATISSIA S.A. | Greece | Beverage & Fast food services |
- | 64.46% | 64.46% | Purchase Method |
2008-2017 |
| PLATEIA S.A. | Greece | Beverage & Fast food services |
- | 60.77% | 60.77% | Purchase Method |
2010-2017 |
| EVERCAT S.A. | Greece | Knowhow and education services |
- | 92.08% | 92.08% | Purchase Method |
2010-2017 |
| VARELAS S.A. | Greece | Beverage & Fast food services |
- | 92.08% | 92.08% | Purchase Method |
2007-2017 |
| EVERFOOD S.A. | Greece | Beverage & Fast food services |
- | 92.08% | 92.08% | Purchase Method |
2007-2017 |
| EVERHOLD LTD | Cyprus | Holding company |
- | 92.08% | 92.08% | Purchase Method |
- |
| MAKRYGIANNI S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| MAROUSSI S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2012-2017 |
| OLYMPUS PLAZA CATERING S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| MAGIC FOOD S.A. | Greece | Beverage & Fast food services |
- | 92.08% | 92.08% | Purchase Method |
2008-2017 |
| FOOD CENTER S.A. | Greece | Beverage & Fast food services |
- | 62.78% | 62.78% | Purchase Method |
2008-2017 |
| ACHARNON S.A. | Greece | Beverage & Fast food services |
- | 36.83% | 36.83% | Purchase Method |
2010-2017 |
| OLYMPUS PLAZA S.A. | Greece | Restaurant Café & Mini market |
- | 78.34% | 78.34% | Purchase Method |
2010-2017 |
| Company Name | Domicile | Principal activity |
Direct % |
Indirect % |
Total % | Consolidation Method |
Non-tax Audited Years (5) |
|---|---|---|---|---|---|---|---|
| CHOLARGOS S.A. | Greece | Beverage & Fast food services |
- | 61.69% | 61.69% | Purchase Method |
2010-2017 |
| I. FORTOTIRAS - E. KLAGOS & CO PL | Greece | Beverage & Fast food services |
- | 23.02% | 23.02% | Purchase Method |
2010-2017 |
| VOULIPA S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| SYNERGASIA S.A. | Greece | Beverage & Fast food services |
- | 92.08% | 92.08% | Purchase Method |
2008-2017 |
| GALATSI S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2008-2017 |
| EVERSTORY S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2010-2017 |
| KOMVOS GEFSEON S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2011-2017 |
| PHILADELFIOTIKI GONIA S.A. | Greece | Beverage & Fast food services |
- | 46.96% | 46.96% | Purchase Method |
2011-2017 |
| PLAZA S.A. | Greece | Restaurant Café & Mini market |
- | 87.01% | 87.01% | Purchase Method |
2008-2017 |
| PASTERIA S.A. Subsidiaries | |||||||
| KOLONAKI S.A. | Greece | Restaurant | - | 91.50% | 91.50% | Purchase Method |
2010-2017 |
| DELI GLYFADA S.A. | Greece | Restaurant | - | 90.66% | 90.66% | Purchase Method |
2010-2017 |
| ALYSIS LTD | Greece | Restaurant | - | 50.37% | 50.37% | Purchase Method |
2010-2017 |
| PANACOTTA S.A. | Greece | Restaurant | - | 21.98% | 21.98% | Purchase Method |
2012-2017 |
| POULIOU S.A. | Greece | Restaurant | - | 46.70% | 46.70% | Purchase Method |
2008-2017 |
| CAPRESE S.A. | Greece | Restaurant | - | 46.70% | 46.70% | Purchase Method |
2010-2017 |
| FOOD CENTER S.A. | Greece | Beverage & Fast food services |
- | 29.14% | 29.14% | Purchase Method |
2008-2017 |
| HELLENIC CATERING S.A. Subsidiary GEFSIPLOIA S.A. (former GLYFADA RESTAURANTS - PATISSERIES S.A.) |
Greece | Café-patisserie | - | 0.23% | 0.23% | Purchase Method |
2010-2017 |
| HELLENIC FOOD SERVICE PATRON S.A. | Greece | Wholesale trade |
- | 90.26% | 90.26% | Purchase Method |
2008-2017 |
| WHITE MOUNTAIN S.A. (former NAFPLIOS S.A.) |
Greece | Café-patisserie | - | 5.26% | 5.26% | Purchase Method |
2010-2017 |
| PALLINI RESTAURANTS S.A. | Greece | Restaurants - Café patisseries |
- | 0.78% | 0.78% | Purchase Method |
2009-2017 |
| MALIAKOS RESTAURANTS S.A. Subsidiary | |||||||
| ALMIROU VOLOS RESTAURANTS PATISSERIES TRADING COMPANIES S.A. |
Greece | Restaurants - Café patisseries |
- | 8.74% | 8.74% | Purchase Method |
2011-2017 |
| FOOD CENTER S.A. Subsidiary | |||||||
| PANACOTTA S.A. | Greece | Restaurant | - | 46.88% | 46.88% | Purchase Method |
2012-2017 |
| ALESIS S.A. Subsidiary | |||||||
| BULZYMCO LTD | Cyprus | Holding company |
- | 46.96% | 46.96% | Purchase Method |
- |
| BULZYMCO LTD Subsidiary | |||||||
| ALESIS BULGARIA EOOD | Bulgaria | Frozen dough & pastry products |
- | 46.96% | 46.96% | Purchase Method |
- |
| HARILAOU RESTAURANTS S.A. Subsidiary | |||||||
| ZEFXI RESTAURANTS - PATISSERIES S.A. | Greece | Restaurants - Café patisseries |
- | 1.35% | 1.35% | Purchase Method |
2010-2017 |
| UNITED MILK COMPANY AD Subsidiary DELTA GREEK FOODS USA INC (former VIVARTIA USA INC) |
U.S.A. | Trading company |
- | 92.08% | 92.08% | Purchase Method |
- |
| Company Name | Domicile | Principal activity |
Direct % |
Indirect % |
Total % | Consolidation Method |
Non-tax Audited Years (5) |
|---|---|---|---|---|---|---|---|
| MAGIC FOOD S.A. Subsidiaries | |||||||
| Ε.Κ.Τ.Ε.Κ. S.A. | Greece | Real estate management |
- | 20.72% | 20.72% | Purchase Method |
2010-2017 |
| GS COFFEE N ICE L.P. | Greece | Beverage & Fast food services |
- | 73.66% | 73.66% | Purchase Method |
2013-2017 |
| PALLINI RESTAURANTS S.A. Subsidiary | |||||||
| GEFSIPLOIA S.A. (former GLYFADA RESTAURANTS - PATISSERIES S.A.) |
Greece | Restaurants - Café patisseries |
- | 0.08% | 0.08% | Purchase Method |
2010-2017 |
| M. ARABATZIS S.A. Associate consolidated under the equity consolidation method | |||||||
| IONIKI SFOLIATA S.A. | Greece | Frozen dough & pastry products |
- | 15.34% | 15.34% | Equity Method | 2010-2017 |
| EVEREST HOLDINGS & INVESTMENTS S.A. Associates consolidated under the equity consolidation method | |||||||
| Restaurant | |||||||
| OLYMPUS PLAZA LTD | Greece | Café & Mini market |
- | 40.52% | 40.52% | Equity Method | 2008-2017 |
| DELTA FOODS S.A. Associates consolidated under the equity consolidation method | |||||||
| EXEED VIVARTIA INVESTMENT (EVI) | UAE (6) | Holding company |
- | 45.12% | 45.12% | Equity Method | - |
| MEVGAL S.A. | Greece | Production & distribution of |
- | 39.78% | 39.78% | Equity Method | 2011-2017 |
| dairy products | |||||||
| EXEED VIVARTIA INVESTMENT (EVI) Subsidiaries | |||||||
| EXEED VIVARTIA GENERAL TRADING (EVGT) |
UAE (6) | Trading company |
- | 44.67% | 44.67% | Equity Method | - |
| EXEED VIVARTIA COMMERCIAL BROKERAGE (EVGB) |
UAE (6) | Trading company |
- | 44.67% | 44.67% | Equity Method | - |
| MEVGAL S.A. Subsidiaries | |||||||
| DIATROFI SINGLE MEMBER LTD | Greece | Dormant | - | 39.78% | 39.78% | Equity Method | 2011-2017 |
| EVROGAL S.A. MEVGAL USA INC |
Greece U.S.A. |
Dormant Dormant |
- - |
39.78% 39.78% |
39.78% | Equity Method Equity Method |
2011-2017 - |
| MEVGAL ENTERPRISES LIMITED | Cyprus | Dormant | - | 39.78% | 39.78% 39.78% |
Equity Method | - |
| MEVGAL BULGARIA EOOD | Bulgaria | Under | - | 39.78% | 39.78% | Equity Method | - |
| MEVGAL UK LIMITED | United | liquidation Trademarks |
- | 39.78% | 39.78% | Equity Method | - |
| Kingdom | management | ||||||
| MEVGAL S.A. Associate consolidated under the equity consolidation method MAKEDONIKI FARM S.A. |
Greece | Dormant | - | 7.96% | 7.96% | Equity Method | 2011-2017 |
| ATTICA GROUP | |||||||
| ATTICA S.A. Subsidiaries | |||||||
| SUPERFAST EPTA M.C. | Greece | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| SUPERFAST OKTO M.C. | Greece | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| SUPERFAST ENNEA M.C. | Greece | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| SUPERFAST DEKA M.C. | Greece | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| NORDIA M.C. | Greece | Overseas transport |
- | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| MARIN M.C. | Greece | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| ATTICA CHALLENGE LTD | Malta | Dormant | - | 89.38% | 89.38% | Purchase Method |
- |
| ATTICA SHIELD LTD | Malta | Dormant | - | 89.38% | 89.38% | Purchase Method |
- |
| SUPERFAST DODEKA (HELLAS) INC & CO JOINT VENTURE |
Greece | Dormant | - | 89.38% | 89.38% | Common mgt(2) | 2009-2017 |
| SUPERFAST FERRIES S.A. | Liberia | Ships management |
- | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| SUPERFAST PENTE INC | Liberia | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| SUPERFAST EXI INC | Liberia | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| SUPERFAST ENDEKA INC | Liberia | Overseas and coastal transport |
- | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| SUPERFAST DODEKA INC | Liberia | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| Company Name | Domicile | Principal activity |
Direct % |
Indirect % |
Total % | Consolidation Method |
Non-tax Audited Years (5) |
|---|---|---|---|---|---|---|---|
| BLUESTAR FERRIES MARITIME S.A. | Greece | Overseas and coastal transport |
- | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| BLUE STAR FERRIES JOINT VENTURE | Greece | Dormant | - | 89.38% | 89.38% | Common mgt(2) | 2009-2017 |
| BLUE STAR FERRIES S.A. | Liberia | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2014 |
| WATERFRONT NAVIGATION COMPANY | Liberia | Dormant | - | 89.38% | 89.38% | Purchase Method |
- |
| THELMO MARINE S.A. | Liberia | Dormant | - | 89.38% | 89.38% | Purchase Method |
- |
| BLUE ISLAND SHIPPING INC | Panama | Dormant | - | 89.38% | 89.38% | Purchase Method |
- |
| STRINTZIS LINES SHIPPING LTD | Cyprus | Dormant | - | 89.38% | 89.38% | Purchase Method |
- |
| SUPERFAST ONE INC | Liberia | Overseas and coastal transport |
- | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| SUPERFAST TWO INC | Liberia | Overseas and coastal transport |
- | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| ATTICA FERRIS M.C. | Greece | Overseas and coastal transport |
- | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| BLUE STAR FERRIS M.C. & CO JOINT VENTURE |
Greece | Overseas and coastal transport |
- | 89.38% | 89.38% | Common mgt(2) | 2009-2017 |
| BLUE STAR M.C. | Greece | Overseas and coastal transport |
- | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| BLUE STAR FERRIES M.C. | Greece | Dormant | - | 89.38% | 89.38% | Purchase Method |
2010-2017 |
| ATTICA FERRIS MARITIME S.A. | Greece | Overseas and coastal transport |
- | 89.38% | 89.38% | Purchase Method |
2011-2017 |
| ATTICA S.A. Associate | |||||||
| AFRICA MOROCCO LINKS | Morocco | Overseas transport |
- | 43.80% | 43.80% | Equity Method | - |
| SINGULARLOGIC GROUP | |||||||
| SINGULARLOGIC S.A. subsidiaries | |||||||
| PROFESSIONAL COMPUTER SERVICES S.A. | Greece | Integrated software solutions |
- | 43.28% | 43.28% | Purchase Method |
2010-2017 |
| SINGULAR BULGARIA EOOD | Bulgaria | IT support and trade |
- | 85.70% | 85.70% | Purchase Method |
- |
| SINGULAR ROMANIA SRL | Romania | IT support and trade |
- | 85.70% | 85.70% | Purchase Method |
- |
| METASOFT S.A. | Greece | Trade computers & software |
- | 85.70% | 85.70% | Purchase Method |
2010-2017 |
| SYSTEM SOFT S.A. | Greece | Software systems consultants |
- | 85.70% | 85.70% | Purchase Method |
2010-2017 |
| SINGULARLOGIC CYPRUS LTD | Cyprus | IT support and trade |
- | 84.67% | 84.67% | Purchase Method |
- |
| G.I.T. HOLDINGS S.A. | Greece | Holding company |
- | 85.70% | 85.70% | Purchase Method |
2010-2017 |
| G.I.T. CYPRUS | Cyprus | Investing company |
- | 85.70% | 85.70% | Purchase Method |
- |
| SENSE ONE TECHNOLOGIES S.A. | Greece | IT support and trade |
- | 43.70% | 43.70% | Purchase Method |
2011-2017 |
| SINGULARLOGIC MARITIME SERVICES LTD |
Cyprus | IT support | - | 85.70% | 85.70% | Purchase Method |
- |
| SINGULARLOGIC S.A. Associates consolidated under the equity consolidation method | |||||||
| INFOSUPPORT S.A. | Greece | IT support and trade Trade |
- | 29.14% | 29.14% | Equity Method | 2010-2017 |
| INFO S.A. | Greece | computers & software |
- | 30.00% | 30.00% | Equity Method | 2010-2017 |
| LOGODATA S.A. | Greece | Computer applications |
- | 20.47% | 20.47% | Equity Method | 2005-2017 |
| Company Name | Domicile | Principal activity |
Direct % |
Indirect % |
Total % | Consolidation Method |
Non-tax Audited Years (5) |
|---|---|---|---|---|---|---|---|
| HYGEIA GROUP | |||||||
| HYGEIA S.A. subsidiaries | |||||||
| MITERA S.A. | Greece | Primary and secondary healthcare services - maternity & pediatric healthcare |
- | 70.07% | 70.07% | Purchase Method |
2011-2017 |
| MITERA HOLDINGS S.A. | Greece | services Holding company Primary & |
- | 70.38% | 70.38% | Purchase Method |
2010-2017 |
| LETO S.A. | Greece | secondary maternity and gynecology healthcare |
- | 70.00% | 70.00% | Purchase Method |
2010-2017 |
| LETO HOLDINGS S.A. | Greece | services Holding company Molecular |
- | 69.87% | 69.87% | Purchase Method |
2010-2017 |
| ALPHA-LAB S.A. | Greece | biology and cytogenetics diagnostic |
- | 70.00% | 70.00% | Purchase Method |
2010-2017 |
| HYGEIA HOSPITAL-TIRANA ShA | Albania | center Primary and secondary healthcare services and maternity services Commercial |
- | 70.38% | 70.38% | Purchase Method |
- |
| Y-LOGIMED S.A. (former ALAN MEDICAL S.A. |
Greece | company of medical consumables, implantable devices & equipment |
- | 70.38% | 70.38% | Purchase Method |
2010-2017 |
| Y-PHARMA S.A. | Greece | Commercial company |
- | 59.83% | 59.83% | Purchase Method |
2010-2017 |
| ANIZ S.A. | Greece | Catering services |
- | 49.27% | 49.27% | Purchase Method |
2010-2017 |
| BEATIFIC S.A. | Greece | Commercial company of medical cosmetics |
- | 70.38% | 70.38% | Purchase Method |
2014-2017 |
Notes
(1) The companies MARFIN CAPITAL S.A. and MIG SHIPPING S.A. are offshore companies and are not subject to corporate income tax. For the companies outside European Union, which do not have any branches in Greece, there is no obligation for a tax audit.
(2) Common mgt = Under common management
(3) New Inc. = New incorporation
(4) BVI = British Virgin Islands
(5) In respect to the Group companies established in Greece, which meet the relevant criteria for falling under the tax audit of Certified Auditors, the tax audit of fiscal years 2011-2013 has been completed according to Law 2238/1994, article 82, par.5, and for the financial years 2014-2016 under the provisions of Law 4174/2013, article 65A, par.1. It is to be noted that the tax audit of fiscal year 2017 is in progress. Further information is presented in note 48.6. It shall be noted that on 31/12/2017, the years up to 31/12/2011 have become time-barred in accordance with the provisions of Law 4174/2013, article 36, par.1.
(6) UAE = United Arab Emirates
The consolidated Financial Statements for the annual period which ended on December 31, 2017 compared to the corresponding annual period of 2016 include under the purchase method of consolidation, the companies: i) CHOLARGOS RESTAURANTS S.A. which is a new acquisition of VIVARTIA group and has been consolidated under the purchase method since 02/01/2017, ii) PELASGIANS P.C. which is a new acquisition of VIVARTIA group and has been consolidated under the purchase method since 24/04/2017 and iii) PLAZA S.A. consolidated under the purchase method since 13/12/2017, as a result of share capital increase without the participation of minority interest (till 13/12/2017, the company in question was consolidated under the equity method).
The companies, not consolidated in the Financial Statements for the annual period ended on December 31, 2017, whereas they were consolidated in the corresponding annual period of 2016, are as follows: (a) under the purchase method of consolidation, the companies: i) ALBANIAN RESTAURANTS Sh.P.K. due to finalization of liquidation procedures regarding the idle company within the first quarter of 2017, (ii) GEFSI S.A. due to finalization of liquidation procedures regarding the idle company within the last quarter of 2017, iii) BIO-CHECK INTERNATIONAL PRIVATE MULTI-MEDICAL FACILITIES S.A. due to disposal as at 08/12/2017, iv) PRIVATE POLICLINIC WEST ATHENS PRIMARY CARE MEDICINE S.A. due to disposal as at 08/12/2017, v) LETO LAB S.A. due to finalization of liquidation procedures regarding the idle company as at 05/12/2017, and vi) ATTICA PREMIUM S.A. due to the company's liquidation within 2017 and (b) under the equity method, the companies (i) DYNACOMP S.A. due to disposal as at 27/04/2017 and (ii) SUNCE KONCERN D.D. due to disposal as at 13/06/2017.
In the consolidated Financial Statements for the year ended December 31, 2017, the item "Noncurrent assets held for sale" the company HYGEIA HOSPITAL-TIRANA ShA is included (see note 7.3).
Finally, it is noted that the results of ATHENIAN ENGINEERING for the presented periods are presented under the results from discontinued operations of the Group (see note 7.4).
The Company's consolidated and corporate Financial Statements as of 31/12/2017 covering the financial year starting on January 1st until December 31st 2017, have been prepared according to the International Financial Reporting Standards (IFRS), which were published by the International Accounting Standards Board (IASB) and according to their interpretations, which have been published by the International Financial Reporting Interpretations Committee (IFRIC) and have been adopted by the European Union until 31/12/2017. The Group applies all the International Accounting Standards, International Financial Reporting Standards and their Interpretations, which apply to the Group's activities. The relevant accounting policies, a summary of which is presented below in Note 4, have been applied consistently in all periods presented.
The aforementioned Financial Statements were prepared based on the going concern principle, which implies that the Company and its subsidiaries will be in position to continue operating as entities in the foreseeable future, taking into account the following conditions and actions, designed and implemented by the Management.
As at 31/12/2017, the Group and the Company present negative working capital, since the current liabilities exceed the current assets by € 488,765k and € 75,266k respectively, while the main part of the current liabilities is related to short-term borrowing. Regarding the restructuring procedure in respect of the Group's subsidiaries, as at the annual statements approval date, the Management has entered into a Private Financial Restructuring Agreement with the crediting banks regarding bank loan liabilities amounting to € 369,467k (VIVARTIA group) and is in discussions on restructuring other bank loan liabilities amounting to € 162,393k (VIVARTIA, SILO, RKB).
It is to be noted that within the current year, the Group has successfully completed the restructuring of loan liabilities of HYGEIA and MITERA and, therefore, the amount of € 121,909k was reclassified from current loan liabilities into non-current loan liabilities (see Note 27).
The Group's Management estimates that the aforementioned matters will conclude successfully following the actions that have taken place.
On 27/04/2017, the Management signed a Restructuring Agreement, as amended and effective currently, with PIRAEUS BANK for the restructuring of the Company's existing loan liabilities totaling € 554,122k ( mainly consisting of Common Bond Loans of € 149,483k, a convertible bond loan of € 375,247k and other bank loans of € 29,392k)
As part of the implementation of the above Restructuring Agreement, from April 2017 until the date of approval of the accompanying annual Financial Statements, the following actions have taken place:
controlled by the Andabak family. The consideration of the transaction amounting to € 43 m was fully paid in cash and was utilized, after covering transaction costs, for the repayment of the existing loan liabilities of the Company amounting to € 42.6 m.
c. Issuance of the new Convertible Bond Loan (CBL) amounting to € 425,200k: The Board of Directors announced that at its meeting of 27/07/2017, it specified the terms of the new Convertible Bond Loan (CBL), the issuance of which was resolved by the 2nd Reiterative Annual General Meeting of 10/07/2017. The aggregate amount of the CBL stands at € 460,302k divided into 1,534,340,000 bonds of a par value of € 0.30 each convertible into shares. The coverage and payment by PIRAEUS BANK of Tranche A amounting to € 425,200k divided into 1,417,333,334 bonds of a par value of € 0.30 each convertible into Company's shares took place on 31/07/2017 and was certified by the Board of Directors on the same date. The 31st July 2017 was determined as issuance date.
The proceeds from the issuance were used for refinancing of other existing loan obligations of the Company, including both tranches of the CBL issued on 29/07/2013 amounting to € 375,247k and existing obligations towards PIRAEUS BANK amounting to approximately € 47,583k, according to the resolution on the use of proceeds. The remaining amount of € 2,370k was used for repaying intragroup loans of the Company.
Further information regarding the CBL is provided in Note 27.
Having completed the above, Management is in the process of implementing terms of the Restructuring Agreement, relating to compliance with the provisions in respect of financial ratios, as well as disposal of assets of the Group, upon receiving of the required consent, om case basis, of other stakeholders, aiming at substantial reduction of the Company's total borrowing. The procedure in question shall be implemented within 2018 – 2019.
Any failure to fulfill a term or completion of the required steps, which are interrelated, may result in failure to complete the implementation of the terms of the Restructuring Agreement. In such a case, the Management will initially seek to defer the repayment of its contractual debts from the existing borrowing and, at the same time, renegotiate the key terms of the restructuring agreement with the co-operating bank.
As at 31/12/2017, VIVARTIA group loan liabilities (capital and interest) amounting to € 369,467k concern Common Syndicated Bond Loans, whose restructuring as at the date of approval of the accompanying financial statements is at the final phase of implementation, with a predetermined date of completion of 18/07/2018 at the latest.
In particular, on 01/03/2018, VIVARTIA group signed a Private Restructuring Agreement (hereinafter referred to as the "Agreement") with the crediting banks, on bond loans totaling € 318,000k of VIVARTIA group and interest due on syndicated loans of Catering sector, which at 31/12/2017 amounted to € 51.5 m. The Agreement records the framework of the basic terms of the Restructuring of the aforementioned loans, the pending terms conditions to be complied with and the timetable of the program's implementation.
The aforementioned Agreement reflects the need to adjust VIVARTIA Group loans to the adverse conditions prevailing in the Greek Economy in recent years and was based on business plans of the next five years for which IBRs were performed by an independent auditing firm and on the one hand, makes provisions for substantial decrease in financial costs (lower interest rates) and on the other hand extends the loans maturity for a further seven years.
As part of the implementation of Restructuring, from March 2018 until the date of approval of the accompanying annual Financial Statements, the first stage of the Restructuring Agreement has been completed, through the issue of the CBL of VIVARTIA, whose proceeds were used to repay equally amounting bank borrowings of the Catering sector. The CBL plan was signed according to the schedules as at 04/04/2018, and its coverage was completed on 18/04/2018.
Subsequently, according to the terms of the Agreement and Common Bond Loan of VIVARTIA, an agreement on the Final Terms of the syndicated bond loans of DELTA, BARBA STATHIS, GOODY'S and EVEREST subsidiaries is expected to be reached by 18/07/2018 at the latest. In this context, on 17/04/2018 the subsidiaries received approvals on requests for extension of maturity of the aforementioned loans until 20/04/2018 and retroactive application of the new lower interest rates from 20/01/2018 to 20/04/2018 as referred to in the Restructuring Agreement dated 01/03/2018.
From the negotiations held so far, no significant differentiation is expected other than those agreed above, as reflected in VIVARTIA Common Bond Loan Agreement, and the restructuring process is expected to be completed by 18/07/2018 at the latest.
Further information is provided in Note 27.
Furthermore, according to the relevant references of the aforementioned Agreement, following the settlement of the syndicated loan, a final settlement of the other loan liabilities is expected (plus interest) of the Catering sector, totaling € 11,905k, whose the repayment date has expired and a restructuring proposal has been made to the crediting bank, so that it could be approved it within the next few months as it is directly related to the final terms of the restructuring.
The Group's short-term liabilities as at 31/12/2017 (as detailed in Note 27) include capital and interest liabilities of subsidiaries SINGULARLOGIC και RKB totaling € 150,487k, regarding which the Management is in discussions with creditor banks as far as restructuring is concerned.
In particular, the aforementioned Group's companies, at the date of approval of the accompanying Financial Statements, are in the process of discussions with the banks, in order to restructure the terms of the loan obligations of the subsidiaries (see Note 27), by examining projects that will potentially become mutually acceptable. The objective of the discussions is to extend the repayment period of loans and create more realistic financial ratios in line with the current economic conditions. Despite the fact that the current problems of the Greek economy and the Greek banking sector have led to imposition of more strict lending criteria, Group Management is optimistic and believes that the entire process of the negotiations will be successfully completed over the next few months.
If the above intended actions of the Management regarding the Company and its subsidiaries do not succeed or prove inadequate due to internationally prevailing instability and uncertainty prevailing as well as the uncertainty concerning the implementation of the actions that are not entirely dependent on the Management, then the results, the operation and the prospects of the Group may be adversely affected; that is to say the combination of the described conditions indicates the existence of uncertainty regarding Group's and Company's ability to continue as a going concern.
However, subject to the successful completion of the above actions, the Management reasonably expects that Group and Company will not be faced with financing and liquidity issues within the next 12 months.
The Group's financial Statements have been prepared according to the principle of historical cost, as modified for the fair value adjustment of the items to follow:
The presentation currency is Euro (the currency of the Group's parent domicile) and all the amounts are presented in thοusand Euro unless otherwise mentioned.
The preparation of the financial statements according to IFRS requires the use of estimates and judgments on the application of the Company's accounting policies. Opinions, assumptions and Management estimates affect the valuation of several asset and liability items, the amounts recognized during the financial year regarding specific income and expenses as well as the presented estimates on contingent liabilities.
The assumptions and estimates are assessed on a continuous basis according to historic experience and other factors, including expectations on future event outcomes that are considered as reasonable given the current conditions. The estimates and assumptions relate to the future and, consequently, the actual results may deviate from the accounting calculations.
The aspects requiring the highest degree of judgment as well as the aspects mostly affecting the consolidated Financial Statements are presented in Note 8 to the Financial Statements.
The accounting policies based on which the Financial Statements were drafted, are in accordance with those used in the preparation of the Annual Financial Statements for the FY 2016, adjusted to the new Standards and revisions imposed by IFRS (see par. 3.5.1 to 3.5.2).
The following amendments and interpretations of the IFRS have been issued by IASB, adopted by the European Union and their application is mandatory from or after 01/01/2017.
In January 2016, the IASB published narrow scope amendments to IAS 7. The objective of the amendments is to enable users of financial statements to evaluate changes in liabilities arising from financing activities. The amendments will require entities to provide disclosures that enable investors to evaluate changes in liabilities arising from financing activities, including changes arising from cash flows and non-cash changes. The amendments do not materially affect the consolidated Financial Statements. The Group provides the relative disclosures in Note 28.
In January 2016, the IASB published narrow scope amendments to IAS 12. The objective of the amendments is to clarify the accounting for deferred tax assets for unrealized losses on debt
instruments measured at fair value. The amendments do not materially affect the consolidated Financial Statements.
Annual Improvements to IFRSs – 2014-2016 Cycle (effective for annual periods starting on or after 01/01/2017)
In December 2016, the IASB issued Annual Improvements to IFRSs – 2014-2016 Cycle, a collection of amendments to IFRSs. The issues included in this cycle are the following: IFRS 12: Clarification of the scope of the Standard. The amendments will not materially affect the consolidated Financial Statements. Other amendments included in the aforementioned Cycle, effective for annual periods starting on or after 01/01/2018 are analyzed in the following unit.
Τhe following new Standards, Revised Standards as well as the following Interpretations to the existing Standards have been publicized but have not taken effect yet or have not been adopted by the European Union.
IFRS 9 "Financial Instruments" (effective for annual periods starting on or after 01/01/2018)
In July 2014, the IASB issued the final version of IFRS 9. The package of improvements introduced by the final version of the Standard, includes a logical model for classification and measurement, a single, forward-looking "expected loss" impairment model and a substantially-reformed approach to hedge accounting. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have been adopted by the European Union with effective date of 01/01/2018.
The Group will apply the new Standard without adjusting comparative information, recognizing the cumulative effect of the original application on the opening balance of Equity as at the initial application date. At the reporting date, the Group assessed the impact of the application of IFRS 9. The Management's conclusions regarding the key areas where the new Standard is expected to affect the financial statements are presented below as follows:
Furthermore, the new Standard makes provisions for additional disclosures while modifying the presentation of information. The Group will appropriately modify the nature, scope and structure of the disclosures in respect of financial instruments in order to comply with the new Standard.
In May 2014, the IASB issued a new Standard, IFRS 15. The Standard fully converges with the requirements for the recognition of revenue in both IFRS and US GAAP. The key principles on which the Standard is based are consistent with much of current practice. The new Standard is expected to improve financial reporting by providing a more robust framework for addressing issues as they arise, increasing comparability across industries and capital markets, providing enhanced disclosures and clarifying accounting for contract costs. The new Standard will supersede IAS 11 "Construction Contracts", IAS 18 "Revenue" and several revenue related Interpretations. The above have been adopted by the European Union with effective date of 01/01/2018.
The Group will apply the new standard in the consolidated financial statements as of 01/01/2018 with the cumulative effect of the original application recognized in the opening balance of Equity at the transition date using the retrospective method.
In the context of the application of the Standard, within 2017, the Group thoroughly assessed the accounting treatment for all its sources of income. The most significant source of revenue expected to have an impact on the new Standard is related to rendering services of IT & Telecoms operating segment. When applying IFRS 15, in the case of multiple-element arrangements, separate conduct of commitments is initially identified, which - in some cases - may differ from the cases determined in accordance with the existing Standards. Subsequently, the transaction price is allocated on the basis of the relevant separate sale prices of each recognized performance obligation. As a result, the timing of revenue recognition, as well as the amount of revenue from the conduct of every commitment, may vary.
The Group's Management is in the process of finalizing the impact that the application of the new Standard may have on the consolidated financial statements, which, however, is not expected to be significant for the consolidated financial figures.
In April 2016, the IASB published clarifications to IFRS 15. The amendments to IFRS 15 do not change the underlying principles of the Standard, but clarify how those principles should be applied. The amendments clarify how to identify a performance obligation in a contract, how to determine whether a company is a principal or an agent and how to determine whether the revenue from granting a license should be recognized at a point in time or over time. As analyzed above, the new Standard is not expected to have a significant impact on the Financial Statements of the Group. The above have been adopted by the European Union with effective date of 01/01/2018.
In September 2016, the IASB published amendments to IFRS 4. The objective of the amendments is to address the temporary accounting consequences of the different effective dates of IFRS 9 Financial Instruments and the forthcoming insurance contracts Standard. The amendments to existing requirements of IFRS 4 permit entities whose predominant activities are connected with insurance to defer the application of IFRS 9 until 2021 (the "temporary exemption") and also permit all issuers of insurance contracts to recognize in other comprehensive income, rather than profit or loss, the volatility that could arise when IFRS 9 is applied before the new insurance contracts Standard is issued (the "overlay approach"). The Group will examine the impact of the above on its
Financial Statements, though it is not expected to have any. The above have been adopted by the European Union with effective date of 01/01/2018.
In January 2016, the IASB issued a new Standard, IFRS 16. The objective of the project was to develop a new Leases Standard that sets out the principles that both parties to a contract, i.e. the customer ('lessee') and the supplier ('lessor'), apply to provide relevant information about leases in a manner that faithfully represents those transactions. To meet this objective, a lessee is required to recognise assets and liabilities arising from a lease. The above have been adopted by the European Union with effective date of 01/01/2019.
As at the reporting date, the Group holds non-cancellable operating leases of € 118.7 m. The Standard will mainly affect accounting treatment of operating leases. The Group is expected to finalize the evaluation of its effect during the following months.
In December 2016, the IASB issued Annual Improvements to IFRSs – 2014-2016 Cycle, a collection of amendments to IFRSs, in response to several issues addressed during the 2014-2016 cycle. The amendments are effective for annual periods beginning on or after 1 January 2018 are as follows: IFRS 1: Deletion of short-term exemptions for first-time adopters, IAS 28: Measuring an associate or joint venture at fair value. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have been adopted by the European Union with effective date of 01/01/2018.
Amendment to IFRS 2: "Classification and Measurement of Share-based Payment Transactions" (effective for annual periods starting on or after 01/01/2018)
In June 2016, the IASB published narrow scope amendment to IFRS 2. The objective of this amendment is to clarify how to account for certain types of share-based payment transactions. More specifically, the amendments provide requirements on the accounting for the effects of vesting and non-vesting conditions on the measurement of cash-settled share-based payments, for share-based payment transactions with a net settlement feature for withholding tax obligation, as well as, a modification to the terms and conditions of a share-based payment that changes the classification of the transaction from cash-settled to equity-settled. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have been adopted by the European Union with effective date of 01/01/2018.
In December 2016, the IASB published narrow-scope amendments to IAS 40. The objective of the amendments is to reinforce the principle for transfers into, or out of, investment property in IAS 40, to specify that (a) a transfer into, or out of investment property should be made only when there has been a change in use of the property, and (b) such a change in use would involve the assessment of whether the property qualifies as an investment property. That change in use should be supported by evidence. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have not been adopted by the European Union. The above have been adopted by the European Union with effective date of 01/01/2018.
In December 2016, the IASB issued a new Interpretation, IFRIC 22. IFRIC 22 provides requirements about which exchange rate to use in reporting foreign currency transactions (such as revenue transactions) when payment is made or received in advance. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have been adopted by the European Union with effective date of 01/01/2018.
Amendments to IAS 28: "Long-term Interests in Associates and Joint Ventures" (effective for annual periods starting on or after 01/01/2019)
In October 2017, the IASB published narrow-scope amendments to IAS 28. The objective of the amendments is to clarify that companies account for long-term interests in an associate or joint venture – to which the equity method is not applied – using IFRS 9. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have not been adopted by the European Union.
Amendments to IFRS 9: "Prepayment Features with Negative Compensation" (effective for annual periods starting on or after 01/01/2019)
In October 2017, the IASB published narrow-scope amendments to IFRS 9. Under the existing requirements of IFRS 9, an entity would have measured a financial asset with negative compensation at fair value through profit or loss as the "negative compensation" feature would have been viewed as introducing potential cash flows that were not solely payments of principal and interest. Under the amendments, companies are allowed to measure particular prepayable financial assets with so-called negative compensation at amortized cost or at fair value through other comprehensive income if a specified condition is met. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have been adopted by the European Union with effective date of 01/01/2019.
Annual Improvements to IFRSs – 2015-2017 Cycle (effective for annual periods starting on or after 01/01/2019)
In December 2017, the IASB issued Annual Improvements to IFRSs – 2015-2017 Cycle, a collection of amendments to IFRSs, in response to several issues addressed during the 2015-2017 cycle. The issues included in this cycle are the following: IFRS 3 - IFRS 11: Previously held interest in a joint operation, IAS 12: Income tax consequences of payments on financial instruments classified as equity, IAS 23: Borrowing costs eligible for capitalization. The amendments are effective for annual periods beginning on or after 1 January 2019. The Group will examine the impact of the above on its Financial Statements. The above have not been adopted by the European Union.
IFRIC 23 "Uncertainty over Income Tax Treatments" (effective for annual periods starting on or after 01/01/2019)
In June 2017, the IASB issued a new Interpretation, IFRIC 23. IAS 12 "Income Taxes" specifies how to account for current and deferred tax, but not how to reflect the effects of uncertainty. IFRIC 23 provides requirements that add to the requirements in IAS 12 by specifying how to reflect the effects of uncertainty in accounting for income taxes. The Group will examine the impact of the above on its Financial Statements. The above have not been adopted by the European Union.
In February 2018, the IASB issued amendments to the guidance in IAS 19, 'Employee Benefits', in connection with accounting for plan amendments, curtailments and settlements. The amendments require an entity to use updated assumptions to determine current service cost and net interest for the remainder of the period after a plan amendment, curtailment or settlement; and to recognize in profit or loss as part of past service cost, or a gain or loss on settlement, any reduction in a surplus, even if that surplus was not previously recognized because of the impact of the asset ceiling. The impact on the asset ceiling is recognized in other comprehensive income, and it is not reclassified to profit or loss. The impact of the amendments is to confirm that these effects are not offset. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have not been adopted by the European Union.
In March 2018, the IASB issued the revised Conceptual Framework for Financial Reporting (Conceptual Framework), the objective of which was to incorporate some important issues that were not covered, as well as update and clarify some guidance that was unclear or out of date. The revised Conceptual Framework includes a new chapter on measurement, which analyzes the concept on measurement, including factors to be considered when selecting a measurement basis, concepts on presentation and disclosure, and guidance on derecognition of assets and liabilities from financial statements. In addition, the revised Conceptual Framework includes improved definitions of an asset and a liability, guidance supporting these definitions, update of recognition criteria for assets and liabilities, as well as clarifications in important areas, such as the roles of stewardship, prudence and measurement uncertainty in financial reporting. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have not been adopted by the European Union.
In March 2018, the IASB issued Amendments to References to the Conceptual Framework, following its revision. Some Standards include explicit references to previous versions of the Conceptual Framework. The objective of these amendments is to update those references so that they refer to the revised Conceptual Framework and to support transition to the revised Conceptual Framework. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have not been adopted by the European Union.
In May 2017, the IASB issued a new Standard, IFRS 17, which replaces an interim Standard, IFRS 4. The aim of the project was to provide a single principle-based standard to account for all types of insurance contracts, including reinsurance contracts that an insurer holds. A single principle-based standard would enhance comparability of financial reporting among entities, jurisdictions and capital markets. IFRS 17 sets out the requirements that an entity should apply in reporting information about insurance contracts it issues and reinsurance contracts it holds. The Group will examine the impact of the above on its Financial Statements, though it is not expected to have any. The above have not been adopted by the European Union.
Subsidiaries are all the companies, which the Parent has the power to control directly or indirectly through other subsidiaries. The Company has and exercises control through its ownership of the majority of the subsidiaries' voting rights. The companies also considered subsidiaries are those in which the Company, being their single major shareholder, has the ability to appoint the majority of the members of their Board of Directors. The existence of potentially dilutive minority interests which are exercisable during the financial statements preparation is taken into consideration in order to assess whether the Company controls the subsidiaries.
Subsidiaries are consolidated (full consolidation) under the purchase method from the date of acquisition, which is the date on which control is transferred to the Group and cease to be consolidated from the date on which control ceases. The purchase method of accounting is used to account for the acquisition of subsidiaries. As of the acquisition date, the acquirer shall recognize goodwill arising from the acquisition that is measured as the excess of:
Goodwill is annually tested for impairment, and the difference between its book and its recoverable value is recognized as an impairment loss in the period's results.
Acquisition-related costs are costs (i.e. advisory, legal, accounting, valuation and other professional or consulting fees) are recognized as expenses, burdening profit and loss for the period when incurred.
The opposite case, which is a business combination in which the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed, exceeds the consideration-transferred amount then the transaction is characterized as a bargain purchase. Following all the necessary reexaminations, the excess amount of the aforementioned difference is recognized as profit in profit or loss for the period.
Intracompany transactions, balances, and unrealized gains on transactions between group companies are eliminated. Unrealized losses are also eliminated unless the transaction offers impairment indications of the asset transferred.
Where necessary, the subsidiaries' accounting policies have been modified to ensure consistency with those adopted by the Group. Note 2, provides a full list of the consolidated subsidiaries alongside the Group's shareholdings.
Subsidiaries' financial statements preparation date coincides with the relevant date of the Parent Company.
The investments of the Parent Company in its subsidiaries are measured at cost less impairment losses. Impairment test is performed based on the requirements of IAS 36.
In case of changes in a parent's ownership interest in a subsidiary, it is examined whether the changes result in a loss of control or not.
Non-controlling interests are the part of the subsidiary that is not attributed, directly or indirectly, to the parent company. The losses that relate to the non-controlling interests of a subsidiary might exceed the rights of the non-controlling interests in the parent company's equity. The profit and loss and the total comprehensive income must be attributed to the owners of the parent and to the noncontrolling interests even if this results in the non-controlling interests having a deficit balance.
Associates are the companies on which the Group has significant influence but not control. The assumptions used by the Group are that a shareholding between 20% and 50% of the voting rights of a company indicates significant influence on that company except where it can clearly be proved otherwise. Investments in associates are recognized at cost and are consolidated using the equity method.
At the end of every financial year, the cost increases or decreases with the Group's proportion in the changes in equity of the investee company. The Group's share in the associates' profits or losses following their acquisition is recognized in the Income Statement whereas the change in the associates' reserves is recognized in equity reserves. When the Group's shareholding in the losses of an associate is equal or exceeds the cost of its investment in the associate including any other doubtful debts, the Group does not recognize further losses except if it has covered liabilities or made payments on behalf of the associate and those deriving from its shareholder capacity. If in the future the associate presents profits, the investor will begin to re-recognize its share in the profit, only when its share in the profits becomes equal with its share in the losses not recognized.
Non-realized profits from transactions between the Group and its associates are eliminated by the Group's shareholding in the associates. Non-realized losses are eliminated except if the transaction indicates evidence of impairment of the transferable assets.
The associates' accounting principles are consistent with the accounting principles adopted and applied by the Group. The preparation date of the associates' financial statements coincides with that of the Parent.
Investments in associates in the separate Financial Statements are measured at fair values according to IAS 39 provisions for the assets available for sale. The investments are initially recognized at fair value and any change in their fair value is recognized directly in equity to the extent that the change does not pertain to any loss from permanent impairment in the investment's value. As of 31/12/2017, the Company did not have any investments in associates.
"Joint Arrangements" are classified as either a joint venture or a joint operation depending upon the rights and obligations of the parties to the arrangement.
Interests in joint ventures- under the equity method – are initially recognized at acquisition cost and then adjusted to the Group's percentage on the profit or loss and other comprehensive income of joint ventures. When the extent of the Group participation in joint venture losses equals or exceeds its interest in this joint venture, the Group does not recognize further losses, unless it has incurred obligations or advanced payments on behalf of the joint venture.
Unrealized gains on transactions between the Group and joint ventures are eliminated to the extent of the interest in joint ventures. Moreover, unrealized losses are also eliminated, unless there is evidence for the impairment of the transferred asset.
Moreover, regarding its interests in Joint Arrangements, the Group recognizes the following in its consolidated financial statements:
a) its assets (including its share in any assets under joint arrangement),
d) its expenses (including its share in any expenses burdening it under joint arrangement).
A financial instrument is defined as an agreement creating either a financial asset in a company and a financial liability, or, a shareholding in another company.
The financial assets and liabilities are recognized at the transaction date, which is the date when the Group has committed to buy or sell the asset.
The financial assets and liabilities are initially measured at fair value adding the direct corresponding transaction costs except for the financial assets and liabilities measured at fair value through profit and loss.
The Group's financial instruments are classified in the categories depicted below according to the substance of the contract and the scope underlining their acquisition. The category in which each financial instrument is classified, differs from each other since, for every category in which financial instruments are classified different rules apply in valuing each instrument and recognizing revaluation results either in profit or in loss of the Statement of Comprehensive Income or in other
comprehensive income of the Statement of Comprehensive Income and cumulatively in Equity. The Group's financial assets, excluding hedging instruments, are classified in the following categories:
This category refers to those financial assets that meet any of the following criteria:
(a) They are items that, according to the Group's strategy, are managed, assessed and monitored at fair value. In essence, they are venture capital investments or,
(b) They are instruments which include embedded derivatives which differentiate significantly the cash flows of the primary contract and the Group decides to classify the entire compounded financial instrument in this category.
The assets in this portfolio are measured at fair value and the changes in fair value are recognized in profit or loss of the Statement of Comprehensive Income as a trading result. The financial assets of this category, in the Group's Statement of Financial Position, are included in the account "Trading portfolio and other financial assets at fair value through profit and loss".
ii) Loans and Receivables
These include non-derivative financial assets with fixed or determinable payments, not traded in an active market and which the Group does not plan to sell in the short-term.
Loans and receivables are measured at amortized cost based on the effective rate method less any provisions for impairment. Each change in the value of loans and receivables is recognized in the Income Statement when they are eliminated or are subject to impairment as well as when they are depreciated.
Assets available for sale include non-derivative financial assets, which are either classified as available for sale or they do not meet the criteria to be classified in any other financial assets category. All the financial assets available for sale are measured at fair value, only when their fair value can be reliably estimated, and changes in their fair value are recognized in other comprehensive income of the Statement of Comprehensive Income and cumulatively in a special reserves account in equity. The available for sale portfolio does not have a specified time horizon as to its assets disposal date; however, assets in this portfolio can be disposed according to liquidity requirements, interest rate or price changes.
When assets available for sale are sold or impaired, accumulated profits or losses, which had been recognized in equity, are reclassified and recognized in the Income Statement.
In cases of impairment, the amount of accumulated losses which is transferred from equity to the Income Statement derives from the difference between the acquisition cost and the fair value less any loss from impairment previously recognized.
Impairment losses pertaining to financial assets available for sale, which had been recognized in the Income Statement, cannot be reversed. Losses deriving from financial assets which were recognized in the consolidated Financial Statements for preceding periods can be reversed through the Income Statement if the increase in value relates to events that occurred after the impairment recognition in the Income Statement.
The current value of the aforementioned investments traded in organized stock markets derives from the closing price on the balance sheet date. The fair value of investments not listed in the stock market is derived by using generally accepted valuation techniques. These techniques are based on similar transactions in comparable investments, reference to market multiples based on the market capitalization of investments with similar characteristics, discounted cash flow analysis and other financial valuation models.
Interest income from the available for sale portfolio is recognized in the Income Statement using the effective interest rate method. Dividends from assets available for sale are recognized in the Income Statement when the Group has the right to the dividends. Foreign currency differences are recognized in the Income Statement of the period.
The Group's financial liabilities include mainly bank loans and Bond Loans. Borrowings are initially measured at cost, i.e. at the amount of the cash received minus the cost of issuance. They are then measured at amortized cost under the effective rate method. Loans are classified as short term liabilities unless the Group maintains the absolute right to transfer the settlement of liabilities for at least 12 months after the Financial Statements reporting date.
Financial liabilities may be classified upon initial recognition at FVTPL, if the following criteria are met.
The Group classifies a financial instrument it issued under equity or liabilities depending on the instrument's contractual terms. Convertible bond loans are divided in two parts: on the one hand, the financial liability, and on the other, the equity component regarding the option the holder is granted to convert the bond into common shares of the Company.
In case that the rule "fixed for fixed" of IAS 32 is not qualified, the convertible bond loan constitutes as a whole a compound financial instrument and as a whole (both the element of the loan and the incorporated derivative in the form of conversion option) is classified as a financial liability.
The financial liability is initially measured at present value of any future payments the Group has assumed regardless of bond holders' exercising any option. The discount rate used is the market rate in effect on the issuing date for a similar loan, excluding the embedded conversion option. Subsequently, the liability is measured either at amortized cost by the effective rate method or at the fair value according to the specific characteristics of each CBL. The interest derived from bond loans is included in the 'Financial expenses' account.
The residual value between the net product of issue and the present value of the financial liability, after subtracting the corresponding income tax is directly credited to equity.
Regarding the new CBL amounting to € 425,200k issued by MIG on 31/07/2017, conversion price is the same as the stock market share price recorded on the day preceding the Conversion Notification Day. In case the stock market share price is lower than the nominal value of share (€ 0.30), the Company will, at request of bondholders, proceed with the appropriate corporate actions in order to facilitate adjustment of the stock market price to at least thirty cents, which will constitute the conversion rate. Therefore, the new CBL is a compound financial instrument, in particular, a convertible loan, which, given that it does not qualify under the rule "fixed for fixed" of IAS 32, constitutes as a whole (both the element of the loan and the incorporated derivative in the form of conversion option), a financial liability that is measured at cost.
After the issue, accounting treatment of the disposal of the Company's convertible bonds by the companies of the Group in the consolidated Financial Statements is similar to that effective for the initial issue of bonds.
ATTICA group's subsidiary, BLUE STAR FERRIES MARITIME S.A. ("BSF"), has issued an Exchangeable Bond Loan ("EBL"). Moreover, the Group's subsidiary, ATTICA has issued a Convertible Bond Loan ("CBL"), which – following its initial coverage – was entirely repurchased by ATTICA for a total consideration equal to the total nominal value of the bonds, so that the aforementioned bonds, convertible into new ATTICA ordinary nominal shares, should be available to be exchanged for EBL bonds. The conversion rate is linked to the EBITDA of the last eight quarters of ATTICA group. At Group level, the EBL and CBL are complementary, since bondholders can either opt for holding bonds and receiving cash from ATTICA (through BSF) at their maturity or converting them (through exchanging EBL for CBL) into ATTICA shares. It is a compound financial instrument, in particular, a convertible loan, which, given that it does not qualify under the rule "fixed for fixed" of IAS 32, constitutes as a whole (both the element of the loan and the incorporated derivative in the form of conversion option), a financial liability that is measured at fair value through profit or loss.
The Group uses derivative financial instruments such as Forward Rate Agreements, Interest Rate and Currency Swaps and other derivatives in order to hedge against interest rate and exchange rate fluctuations.
The Group classifies its derivatives as held for hedging purposes. The Group uses derivatives for hedging risks deriving from changes in interest rates, changes in share prices and exchange rates and fuel. The Group applies fair value hedging or cash flow hedging which meet the relevant criteria. For derivatives that do not meet the criteria for hedge accounting, profits or losses deriving from changes in fair value are recognized in profits or losses for the period.
Hedging relationship for which hedge accounting is required exists in the following cases:
(b) The hedge is expected to be extremely effective for offsetting fair value or cash flow changes attributed to the hedged risk, pursuant to the documented risk management strategy for the said hedge relationship.
(c) As for the forecasted cash flow hedges, it is possible that the anticipated transaction which is the subject of the hedge may also be exposed to the risk of a cash flow change that could affect the results.
The derivatives that are held for hedging are measured on each reporting date at fair value. The accounting treatment of changes in fair value depends on the type of hedge.
For fair value hedges that meet the criteria for hedge accounting, any profit or loss from the revaluation of the derivative at fair value is recognized in profit or loss in the Income Statement. Any profit or loss of the hedged instrument due to the hedged risk readjusts the book value of the hedged instrument and is recognized in the Income Statement, irrespective of the classification of the financial instrument (e.g. AFS financial instruments).
Hedge accounting is discontinued when the hedging instrument expires or is sold, is terminated or exercised, or when the hedge no longer meets the criteria for hedge accounting. If there is any adjustment in the book value of the hedged instrument for which the effective interest rate is used, the adjustment is transferred partially to the Income Statement as a part of a recalculated effective rate for the remaining life of the instrument.
For cash flow hedges that meet the criteria for hedge accounting, the part of the profit or loss from the derivative that is designated as an active hedge is recognized directly in the "reserves" account, and the part that is designated as an inactive hedge is recognized in the Income Statement. Any profit or loss that had been recognized directly in other comprehensive income and cumulatively in the reserves account is transferred to the Income Statement for the same period when the hedged transaction affects the results.
Hedge accounting is discontinued when the hedging instrument expires or is sold, is terminated or exercised, or when the hedge no longer meets the criteria for hedge accounting. The accumulated profit or loss which has been directly recognized in equity until the date in question remains in the equity reserve until the hedged instrument affects the Income Statement. If a hedged transaction is not expected anymore to take place, the net accumulated profits or losses which had been recognized in the equity reserves are transferred immediately to the Income Statement.
The fair values of financial assets and liabilities that are traded in active markets are determined by the current bid prices without subtracting the transaction costs. As for non-traded financial assets and liabilities, the fair values are determined by the application of valuation techniques such as an analysis of recent transactions, comparable assets that are traded, derivative valuation models and discounted cash flows.
The Group uses generally accepted valuation methods for the measurement of fair values of ordinary instruments such as interest rate swaps and FX swaps. The data used is based upon relevant market measurements (interest rates, share prices, etc.) on the reporting date of the Statement of Financial Position. Valuation techniques are also used for the valuation of non-traded securities as well as for derivatives on nontrade securities. In this case, the techniques used are more complex and apart from market data, they include assumptions and estimates for the future cash flows of the security. The estimated future cash flows are based upon Management's best estimates and the discount rate used is the market rate for an instrument having the same attributes and risks.
In some cases, the valuations derived from the generally accepted methods for valuation of securities are adjusted to reflect factors which are taken into consideration by the market in order to value a security, such as business risk and marketability risk.
The method used to determine fair value for financial instruments that are valued using valuation models is described below. These models include the Group's assessment of the assumptions an investor would use in performing a fair value valuation and are selected based on the specific characteristics of each investment.
The Company, in accordance with the requirements of IAS 39 "Financial Instruments: Recognition and Measurement" at the end of each reporting period of the financial statements performs the calculations required in relation to the determination of the fair value of its financial instruments. Investments in listed shares in domestic and foreign stock exchanges are valued based on the quoted market prices for these shares. Investments in non-listed shares are valued based on generally accepted valuation models which sometimes incorporate data based on observable market inputs and sometimes are based on unobservable data.
A financial asset is derecognized when the Group loses control over the contractual interests included in the said asset. This happens when the said interests expire or are transferred and the Group has actually transferred all the risks and rewards that arise from ownership.
Financial liabilities are derecognized when the Group's commitment to make payments in cash or other financial instruments expires, is cancelled or eliminated.
When an existing financial liability is replaced by another by the same third party (lender) with different terms and conditions or when the existing terms are substantially differentiated, then the existing liability is derecognized, the differentiated liability is recognized and the difference between the two is recognized in the Income Statement for the financial year.
Financial assets and liabilities are offset and the net amount is presented in the statement of Financial Position when the Group has a legally enforceable right and intends to realize the asset and settle the liability simultaneously on a net amount basis.
Income and expenses are offset only if such an act is permitted by the standards or when they refer to gains or losses that arose from a group of similar transactions such as trading portfolio transactions.
The Group as part of the impairment tests at the end of each financial year:
iii) Examines the business conditions and the available information and estimates regarding future developments in the economy and financial trends.
Following standard practice, the Group retests the assumptions of the business plans on each interim reporting date of the financial statements, using as base the business plan drawn up at the end of the previous annual reporting period and which relates to subsequent financial periods with a five-year horizon.
For impairment measurement purposes, assets are classified into smaller groups of assets that can generate cash flows independently from other assets or Cash Generating Units of the Group (CGU). As result, certain assets are tested for impairment on their own while others at Cash Generating Unit level. Goodwill is allocated to such Cash Generating Units, from which it is expected that benefits will arise from synergies relating to business combinations, and which represent the smaller level within the Group, where the Management monitors goodwill.
Cash Generating Units, to which goodwill has been allocated, are subjected to impairment testing, at least on an annual basis. All other separate assets or Cash Generating Units are subject to impairment testing when events or changes in conditions indicate that their book value may not be recoverable.
An impairment loss is recognized for the amount where the book value of an asset or a Cash Generating Unit exceeds its recoverable amount, which is the highest between fair value less sale costs and value in use. In order to define value in use, the Management defines the estimated cash flows for every Cash Generating Unit, defining a suitable discount rate in order to calculate the current value of these cash flows. The data used for the impairment test arise directly from recent calculations, approved by the Management, suitably adjusted in order not to include future reorganizations and improvements of assets. Discount factors are defined separately for every Cash Generating Unit and reflect the corresponding risk elements, defined by the Management on an individual basis.
The Cash Generating Units' impairment loss firstly decrease the book value of goodwill, allocated to them. The remaining impairment loss is charged pro rata to the other assets of each Cash Generating Unit. With the exception of goodwill, all assets are subsequently reassessed for indications that the previously recognized impairment loss no longer exists. An impairment loss is reversed if the recoverable amount of a Cash Generating Unit exceeds its carrying value.
The Group, on each Statement of Financial Position reporting date, assesses whether a financial asset or a group of financial assets has been impaired.
The financial assets that are subject to impairment test (if such indications exist) are assets measured at acquisition cost or under the equity method (interest in subsidiaries and associates); they are also assets measured at the depreciated cost (long-term assets) and available for sale investments.
In the case of financial instruments measured at fair value (debt securities, securities and available for sale portfolio), the decrease in the asset's fair value, which has been directly recognized in equity, is transferred to the Income Statement. The impairment loss amount equals the difference between the asset's acquisition value and its fair value. A security impairment loss after reversal is not allowed through the Income Statement. On the contrary, if on a subsequent date, a debt security's fair value increases, and relates to objective facts having taken place after the formation of the provision, then the impairment provision reversal is recognized in the Income Statement.
The recoverable value of shareholdings in subsidiaries and associates is determined in the same way as for non-financial assets.
The recoverable/receivable value of other financial assets in order to carry out the relevant impairment tests is determined by the present value of the estimated future cash flows, discounted either by the initial effective discount rate of the asset or group of assets or by the current rate of return of a similar financial asset. The impairment losses incurred are recognized in the reporting period Income Statement.
The consolidated financial statements are presented in Euro, which is the functional currency and the Group's reporting currency.
The assets and liabilities in the financial statements, including goodwill and fair value adjustments due to business combinations, of the foreign subsidiaries, are converted into Euro by using the exchange rates applicable on the Statement of Financial Position reporting date. Revenues and expenses have been converted into the Group's reporting currency by using the average exchange rates prevailing during the financial year. Any differences arising from the said procedure have been debited / (credited) to the "FX translation reserve" account of the subsidiaries' while it's recognised in other income in the Statement of Comprehensive Income. Upon selling, elimination or derecognition of a foreign subsidiary the above FX translation reserve is transferred to the Income Statement of the period.
Foreign currency transactions are converted into the functional currency by using the exchange rates applicable on the date when the said transactions were performed. The monetary assets and liabilities which are denominated in foreign currency are converted into the Group's functional currency on the Statement of Financial Position reporting date using the prevailing exchange rate on that day. Any gains or losses due to translation differences that result from the settlement of such transactions during the period, as well as from the conversion of monetary assets denominated in foreign currency based on the prevailing exchange rates on the Statement of Financial Position reporting date, are recognized in the Income Statement.
The non-monetary assets which are denominated in foreign currency and which are measured at fair value are converted into the Group's functional currency using the prevailing exchange rate on the date of their fair value measurement. The FX translation differences from non-monetary items measured at fair value are considered as part of the fair value and thus are recorded in the same account as the fair value differences. In the case where currency risk is effectively hedged for nonmonetary assets that are valued as available for sale, the part of the change in their fair value which is attributed to currency fluctuations is recognized in the Income Statement for the reporting period.
Gains or losses deriving from transactions in foreign currency as well as from the end of period valuation of monetary assets, denominated in foreign currency, which meet the criteria for cash flow hedges are recognized in other comprehensive income and cumulatively in equity.
Tangible fixed assets are recognized in the financial statements at cost, less accumulated depreciation and any potential impairment losses. The acquisition cost includes all direct costs stemming from the acquisition of the assets.
Subsequent expenses are recorded as an increase in the book value of tangible assets or as a separate asset only to the degree that the said expenses increase the future financial gains anticipated from the use of the fixed asset and their cost can be measured reliably.
The cost of repair and maintenance works is recognized in the Income Statement when the said works are realized.
The depreciation of tangible fixed assets (excluding land, which is not depreciated) is calculated based on the straight-line method over their estimated useful life as follows:
| Tangible fixed assets | Useful life (in years) |
|---|---|
| Buildings | 30-60 |
| Building facilities | 11–20 |
| Machinery and other equipment | 6-20 |
| Vehicles | 4-10 |
| Passenger vessels | 30 |
| Vessels additions and improvements | 5 |
| Port facilities | 10 |
| Other equipment | 3-10 |
The residual value and the useful life of each asset are re-assessed at the end of every financial year.
When the book values of the tangible fixed assets are higher than their recoverable value, then the difference (impairment) is recognized directly as an expense in the Income Statement. Upon sale of tangible assets, the differences between the sale price and their book value are recognized as profits or losses in the Income Statement.
Intangible assets include mainly software licenses, rights, and trademarks. Furthermore, in the consolidated financial statements intangible assets are recognized at fair value which had not been previously recognized in the financial statements of the acquired companies.
An intangible asset is initially recognized at cost. The cost of an intangible asset which was acquired in a business combination is the fair value of the asset on the purchase date.
Following initial recognition, the intangible assets are measured at cost less accumulated amortization and any impairment loss. Amortization is recorded based on the straight-line method during the useful life of the said assets. With exception to some trademarks for which it was estimated that they have an indefinite useful life all other intangible assets have a finite useful life which is between 3 and 26 years. The period and method of amortization is redefined at least at the end of every reporting period.
The maintenance of software programs is recognized as an expense when the expense is realized. In the contrary, the costs incurred for improving or prolonging the return of software programs beyond their initial technical specifications, or respectively the costs incurred for the modification of the software, are incorporated in the acquisition cost of the intangible asset, only if they can be measured reliably.
Trademarks are measured at cost less their accumulated amortization and any impairment losses. Furthermore, trademarks are recognized at fair value based on the purchase price allocation (PPA) into the assets and liabilities of the acquired company.
The cost of trademarks includes initial set up expenses as well as expenses relating to their registration in Greece and abroad.
Customer relations are measured at fair value based on the Purchase Price Allocation of the assets and liabilities of the acquired company.
Licenses are recognized at fair value based on the alloocaiton procedures regarding the consideration effective under bacquisiiotn of assets and liabilities of acquirers. Licenses recognized when allocating acquisiiotn costs have indefinite useful life and are tested for impairment in every reporting period.
The research cost is recognized as an expense in the Statement of Comprehensive Income upon its realization. Development costs are incurred mainly for the development of new products and software development. The R&D costs are recognized as intangible assets only when the provisions of IAS 38 "Intangible assets" are met. Development costs which were recorded in previous periods as expenses are not recognized as intangible assets in a subsequent period, even if it arises that the particular software development will bring future economic benefits.
Industrial property rights include acquisition of copyrights for software sale and are measured at acquisition cost less amortization and potential impairment losses. Amortization is calculated under the straight line method within the duration of the assets useful life.
Below is a summary of the policies adopted regarding the useful life of the Group's intangible assets:
| Intangible assets | Duration | Useful life (in years) |
|---|---|---|
| Brand / Trade names | Defined | 5-20 |
| Software | Defined | 3-8 |
| Customer contracts | Defined | 12-26 |
| Research & development cost | Defined | 4-8 |
| Industrial property rights | Defined | 5 |
| Licenses | Defined | Contractual period |
| Lease rights | Defined | Leasing period |
| Trade names: Hygeia, Mitera, Leto & hospital licenses |
Indefinite | - |
| Trade names: SingularLogic | Indefinite | - |
| Trade names: Blue Star Ferries, Superfast | Indefinite | - |
| Trade names: Delta, Vlachas, Milko, Vitaline, Advance, Life, Barba Stathis, Vereia, Fibella, Everest, La Pasteria, Goody's, Flocafe |
Indefinite | - |
Goodwill arises upon the acquisition of subsidiaries and associates.
Goodwill is the difference between the acquisition cost and the fair value of the assets, liabilities and contingent liabilities assumed of the acquired entity on the date of the acquisition. In the case where a subsidiary is acquired, goodwill is presented as a separate asset, whereas in the case of an associate acquisition, goodwill is included in the Group's investment in associates account.
On the date of acquisition (or on the date of completion of the purchase price allocation), the goodwill is allocated to the Cash Generating Units or to the group of Cash Generating Units which
are expected to benefit from this business combination. Following the initial recognition, the goodwill is measured at cost less accumulated losses due to its impairment. Goodwill is not amortized, but is tested on a yearly basis or more regularly if events or changes in conditions indicate that there might be a possible impairment loss (please refer to Note 4.3.1 in respect of the procedures followed for a goodwill impairment test).
If part of a Cash Generating Unit, to which goodwill has been allocated, is sold, then the amount of goodwill corresponding to the sold part is included in the book value of the asset in order to calculate the profit or loss. The amount of goodwill apportioned to the sold part is assessed based on the relevant values of the part sold as well as on the remaining part of the Cash Generating Unit.
Investment property relates to investments in properties which are held (either through acquisitions or through leasing) by the Group, either to generate rent from its lease or for the increase in its value (increased capital) or for both purposes and are not held: a) to be used for production or distribution of raw materials / services or for administrative purposes; and b) for the sale as part of the company's ordinary activities.
Investment property is initially valued at purchase cost including transaction expenses. Subsequently, it is measured at fair value. Independent appraisers with adequate experience in the location and in the nature of investment properties measure the fair value.
The book value recognized in the Group's Financial Statements reflects the market conditions on the date of the reporting date of the Statement Financial Position. Every profit or loss derived from the fair value revaluations of the investment is recognized in the Income Statement for the period in which it has been recognized (for the result recognized in the Statement of Comprehensive Income for the presented period please refer to note 15).
Properties which are under construction or utilized in order to be used as investment properties in the future are included in investment properties account. In the case where the company is not in a position to measure the fair value of the property which is under construction, but expects to be in a position to measure its fair value upon completion, the investment property under construction will be measured at cost up to the time when it will be feasible to measure the fair value or when the construction will be complete.
Property transfers from investment property to fixed assets take place only when there is a change in the use of the said property which is proven by the Group's own use of the property or by the Group's commencement to develop this property for sale.
An investment property is derecognized (eliminated from the Statement of Financial Position) when it is sold, it is permanently retired or when the investment is not expected to generate future economic benefits from its sale. The profits or losses from the retirement or sale of investment properties are derived from the difference of the net proceeds from the sale and the book value of the asset and are recognized in the Income Statement for the period in which the asset was sold or withdrawn.
A construction contract is a contract specifically negotiated for the construction of an asset or a combination of assets that are closely interrelated (projects for the development of specific software). Such contracts relate to contracts for specific clients and their execution usually has a duration of more than a financial year.
The construction contract costs are recognized when incurred. When the result of a construction contract cannot be measured reliably and especially when the contract is at an early stage:
Therefore, the revenue from such contracts is recognized so that the profit in the particular project to be zero. When the outcome of a construction contract can be estimated reliably, the revenue and associated costs are recognized during the project as revenue and expenses respectively. The Group uses the percentage of completion method in order to define the particular amount of revenue and cost recognized at a certain period.
The level of completion of a contract is measured based on the contractual cost incurred up to the Statement of Financial Position date in respect to the estimated total contract costs. When it is probable that the total contract cost will exceed the total revenue, then expected loss is directly recognized in the Income Statement as expense.
To calculate the costs incurred by the end of the reporting period, any costs related to future work relating to the contract are excluded and shown as work in progress. All the costs incurred and the gain or loss recognized on each contract is compared with the progressive invoices until the end of the reporting period.
Where the costs incurred plus net profits (minus losses) recognized exceed the progressive invoices, the balance appears as a receivable from construction contract clients in the account "Other current assets". When the progressive invoices exceed the recognized incurred costs, plus net profits (minus losses), the balance appears as a liability to construction contract customers in the account "Other short term liabilities".
Inventory is valued at the lowest price between cost and net liquidation value. The cost of finished and semi-finished products includes all costs incurred to obtain and process up to their current state and it includes raw materials, labor costs, general industrial expenses (based on normal operating capacity but excluding cost of debt) and packaging costs. The cost of raw material and of finished products is defined according to the average cost.
The net realizable value of finished and semi-finished products is the estimated selling price during the ordinary operations of the Group minus the estimated costs for their completion and the estimated costs for their sale. The net liquidation value of raw material is the estimated replacement cost during the Company's ordinary operations. A provision for slow-moving or impaired inventories is formed when necessary.
Short-term receivables are presented at their nominal value after provisions for bad debts whereas the long-term receivables (balances which are not compatible with regular credit policies) are measured at amortized cost based on the effective rate method. The Group has set criteria for credit facilities to customers which are generally based on the volume of the customer's activities with a simultaneous assessment of financial information. On every reporting date all delays or bad debts are assessed in order to define if there is a necessity to form a provision for bad debts. The balance of bad debts provisions is adjusted accordingly on every reporting date in order to reflect the possible risks. Every write-off of customers is debited to the provision for doubtful debts. It is the
Group's policy not to write-off any doubtful debts until every possible legal action has been taken for the collection of the debts.
Finance leases of fixed assets where all the risks and rewards related to the ownership of an asset have been transferred to the Company or the Group, are capitalized at the start of the lease at the asset's fair value or if it is lower, at the present value of the minimum lease payments. The finance lease payments are apportioned to the financial expenses and the decrease of financial liability in order to achieve a fixed interest rate in the remaining balance of the liability. The financial expenses are recognized in the Income Statement. The capitalized leased assets are depreciated based on the shortest period between the expected useful life of the asset and the duration of the lease.
Leases where the lessee maintains all the risks and benefits of owning the asset are recognized as operating lease payments. The operating lease payments are recognized as an expense in the Income Statement on a constant basis during the lease term.
For sale and leaseback transactions which constitute finance leases, any positive difference from the sale of the asset with respect to its book value is not recognized immediately as income from the Company but is rather recognized as deferred income in the financial statements which is amortized over the lease's duration.
If the fair value of the asset during its sale and leaseback is lower than its book value, then the loss derived from the difference between the book value and the fair value is not immediately recognized, except if the asset is impaired in which case the asset's book value is decreased to its recoverable value according to IAS 36.
Cash, cash equivalents and restricted deposits include cash in hand, sight deposits, term deposits, bank overdrafts and other highly liquid investments that are directly convertible into particular amounts of cash equivalents which are not subject to significant value change risk. They also include separately the Group's and the Company's blocked deposits.
For purposes of preparing the consolidated Statement of Cash Flows, cash and cash equivalents consist of cash in hand, bank deposits as well as cash equivalents as defined above.
The share capital is defined according to the nominal value of the shares issued by the Company. A share capital increase by cash payment includes every share premium at the initial share capital issuance.
Expenses directly related to a share capital increase are shown subtracted from equity after deducting tax.
Dividends to be paid to shareholders are recognized as a liability in the financial year when they are approved by the Shareholders' General Meeting.
Parent company shares owned by the Parent or its subsidiaries are recognized at acquisition cost, are included in the 'Treasury Shares' account and are subtracted from the Parent Company's equity until they are cancelled, reissued or resold. Treasury share acquisition cost includes transaction expenditures, after excluding the corresponding income tax. The Parent Company's treasury shares do not reduce the number of outstanding shares; they do, nevertheless, affect the number of shares included in the earnings per share calculation. The Parent Company's treasury shares are not entitled to a dividend. The difference between the acquisition cost and the final price from reselling (or reissuing) the treasury shares is recognized in equity and is not included in the net result for the financial year. On 31/12/2017, the Group did not hold any treasury shares.
The income tax charge includes current taxes, deferred tax and the differences of preceding financial years' tax audits.
Current tax is calculated based on the tax statements of Financial Position from each one of the companies included in the consolidated Financial Statements, according to the tax laws applicable in Greece or other tax regulations applicable for foreign subsidiaries. The income tax expense includes income tax based on each company's profits as presented on their tax declarations and provisions for additional taxes and is calculated based on the dully or in principal constituted tax rates.
Deferred taxes are the taxes or the tax reliefs from the financial encumbrances or benefits of the financial year in question, which have been allocated or shall be allocated to different financial years by the tax authorities. Deferred income tax is determined under the liability method deriving from the temporary differences between the book value and tax base of assets and liabilities. There is no deferred income tax if it derives from the initial recognition of an asset or liability at a transaction, other than at a business combination, and the recognition did not affect either the accounting or the tax profit or loss.
Deferred tax assets and liabilities are measured in accordance with the tax rates in effect in the financial year during which an asset or a liability shall be settled, taking into account the tax rates (and tax regulations) which have been or are effectively in force until the Statement of Financial Position reporting date. In case where it is not possible to clearly determine the time needed to reverse the temporary differences, the tax rate applied is the one in force in the day after the Statement of Financial Position reporting date.
Deferred tax assets are recognized when there is taxable income and a temporary difference which creates a deferred tax asset. Deferred tax assets are re-examined on each reporting date and are decreased to the extent where there won't be sufficient taxable income to allow the utilization of the benefit as a whole or in part of the deferred tax asset.
Deferred income tax is recognized for the temporary differences derived from investments in subsidiaries and associates, except in the case whereby the temporary differences reversal is controlled by the Group and is probable that the temporary differences will not be reversed in the foreseeable future.
Most changes in the deferred tax assets and liabilities are recognized as part of the tax expenses in the Income Statement for the financial year. Only those changes in assets and liabilities which affect
the temporary differences are recognized directly in the Group's equity resulting in the relative change in deferred tax assets or liabilities to be recognized in equity.
According to Law 27/1975, Article 6, shipping companies under a Greek flag pay tax for their vessels irrespective of whether they have profits or losses based on gross registered tonnage. In essence, this is income tax which is readjusted according to the aforementioned law provisions.
By the payment of the aforementioned tax, every liability relating to income tax from shipping activities is settled. In this case, a permanent difference is created between accounting and taxable income, as a result the difference is not taken into account in the calculation of deferred tax.
In this case we calculate the total income by adding the income from non-shipping activities. Nonvessel expenses are allocated based on the gross registered tonnage of each vessel.
The amount of profits that results from the above apportionment and relates to non-shipping activities is taxed according to the general tax regulations.
Government grants related to grants for assets are recognized at fair value when there is reasonable assurance that the grant will be received and that all the relevant conditions attached will be met.
These grants are recognized as deferred income, which is recognized in the profits or loss of each reporting period in equal instalments based on the useful life of the asset after deducting all related depreciation expenses.
Grants relating to expenses are recognized after deducting all the relevant expenses during the period required for their systematic correlation with subsidized expenses.
Short-term Benefits: Short-term benefits to personnel (except for termination of employment benefits) in cash and in kind are recognized as an expense when considered accrued. Any unpaid amount is recognized as a liability, whereas in case the amount already paid exceeds the benefits' amount, the entity identifies the excess as an asset (prepaid expense) only to the extent that the prepayment shall lead to a future payments' reduction or refund.
Retirement Benefits: Benefits following termination of employment include lump-sum severance grants, pensions and other benefits paid to employees after termination of employment in exchange for their service. The Group's liabilities for retirement benefits cover both defined contribution plans and defined benefit plans.
The defined contribution plan's accrued cost is recognized as an expense in the financial year where it relates. Pension plans adopted by the Group are partly financed through payments to insurance companies or state social security funds.
Defined contribution plans pertain to contribution payment to Social Security Organizations and therefore, the Group does not have any legal obligation in case the Fund is incapable of paying a pension to the insured person. The employer's obligation is limited to paying the employer's contributions to the Funds. The payable contribution by the Group in a defined contribution plan is identified as a liability after the deduction of the paid contribution, while accrued contributions are recognized as an expense in the Income Statement.
Under Laws 2112/20 and 4093/2012, the Company must pay compensation upon retirement or termination to its employees. The amount of compensation paid depends on the years of service, the level of wages and the way of leaving service (dismissal or retirement). The entitlement to participate in these plans is usually based on years of service of the employee until retirement.
The liability recognized in the Statement of financial Position for defined benefit plans is the present value of the liability for the defined benefit less the plan assets' fair value (reserve from payments to an insurance company), the changes deriving from any actuarial profit or loss and the service cost. The defined benefit commitment is calculated on an annual basis by an independent actuary through the use of the projected unit credit method. Regarding FY 2017, the selected rate follows the tendency of iBoxx AA Corporate Overall 10+ EUR indices, which is regarded as consistent with the provisions of IAS 19, i.e. is based on bonds corresponding to the currency and the estimated term relative to employee benefits as well as appropriate for long-term provisions.
A defined benefit plan establishes, based on various parameters, such as age, years of service and salary, the specific obligations for payable benefits. Provisions for the period are included in the relative staff costs in the accompanying separate and consolidated Income Statements and comprise of the current and past service cost, the relative financial cost, the actuarial gains or losses and any possible additional charges. Regarding unrecognized actuarial gains or losses, the revised IAS 19 is applied, which includes a number of changes to accounting for defined benefit plans, including:
The Group grants remuneration to personnel through equity instruments. In particular, the Group grants to personnel, based on a stock option plan approved by the General Shareholders Meeting, stock options for the acquisition of Parent Company shares.
These benefits are settled through issuing new shares by the Parent Company, on condition that the employee fulfils certain vesting conditions linked to his/her performance and exercises his/her options.
Services rendered by employees are measured according to the fair value of the options granted on the grant date. The option's fair value is calculated by using a widely accepted option-pricing model and taking into account the share's closing price on grant date. The options' fair values, following their issue, are readjusted in case there is a modification in the plan in favor of the employees. The fair value of services rendered is recognized as an expense in the Income Statement by an equal credit in equity, in the share premium account. The relevant amount is proportioned throughout the vesting period and is calculated on the basis of the number of options set to be vest in each year.
During the exercise of the stock options, the net collected amount (after subtracting direct costs) is recognized in share capital (new shares nominal value) and in share premium (difference between the stock option exercise price and the share's nominal value).
As of 31/12/2017, there is no active stock option plan for the Group and the Company
Provisions are recognized when the Group has present legal or imputed liabilities as a result of past events; their settlement is possible through resources' outflow and the exact liability amount can be reliably estimated. The provisions are reviewed on the date of the Financial Statements and are adjusted accordingly to reflect the present value of the expense expected for the settlement of the liability. Restructuring provisions are identified only if there is a detailed restructuring plan and if Management has informed the affected parties on the plan's key points. When the effect of the time value of money is significant, the provision is calculated as the present value of the expenses expected to be incurred in order to settle this liability.
If it is no longer probable that an outflow will be required in order to settle a liability for which a provision has been formed, then it is reversed.
In cases where the outflow due to current commitments is considered improbable or the provision amount cannot be reliably estimated, no liability is recognized in the financial statements.
Contingent liabilities are not recognized in the financial statements but are disclosed except if the probability of an outflow, which encompasses economic benefits, is scarce. Possible inflows from economic benefits for the Group which do not meet the criteria of an asset are considered a contingent asset and are disclosed when the inflow of the economic benefits is probable.
Revenue is recognized when it is probable that future economic benefits will flow into the entity and these benefits can be reliably measured. The revenue is measured at the fair value of the consideration received and is net of value added tax, returns, any discount and after the Group's intragroup sales have been eliminated. The amount of revenue can be efficiently measured when all liabilities relating to the sale have been settled.
Revenue recognition occurs as follows:
Services provided under fixed price contracts: Income from fixed price contracts is recognized based on the stage of completion of the transaction at the reporting date of the Statement of Financial Position. Under the percentage of completion method, the contract revenue is recognized based on the services provision and the apportionment of the works already performed to the total works which are to be performed. When the outcome of a transaction pertaining to the provision of services cannot be estimated reliably, then the revenue is recognized only to the extent that the recognized costs are recoverable.
The amount of the sale price relating to a service agreement for services to be provided subsequently is recorded in the transit account and recognized as revenue in the period in which those services are provided. This revenue is included in the account "Other short term liabilities". In cases where there is a change in the original estimates of the revenues then the costs or the completion stage is revised. These readjustments may result in increases or decreases in the estimated revenues and costs and are presented in the income of the period, of which those which render necessary restatements are disclosed by Management.
Revenue, from customer-related long-term construction contracts, is recognized in accordance with the percentage completion of the contract at the reporting date of the Financial Statements. The Group is committed to comprehensive after-sales services in this service sector.
When an asset has been impaired, the Group decreases the book value expected to be received, which is the amount, arising from the future cash flows discounted with the effective rate of the instrument and continues in periodic reversal of discounting as interest income. Interest income from loans which have been impaired is recognized using the initial real rate.
Borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset, which will require considerable time until the asset is ready for the suggested use or disposal, form part of the acquisition cost of that asset until the asset it ready for the suggested
use or disposal. In other cases, the borrowing costs burden profit or loss of the period when incurred.
A discontinued operation is a component of the Group that is either disposed of or classified as held for sale and
Profit or loss from discontinued operations, including profit or loss of the comparative period are presented as a separate line in the Income Statement. This amount constitutes the after tax results of discontinued operations and after-tax profit or loss resulting from the valuation and disposal of the assets classified as held for sale (please refer to note 7).
The disclosures of discontinued operations of the comparative period include disclosures for earlier periods presented in Financial Statements so that the disclosures relate to all the operations that have been discontinued until the last date of the latest period presented. In cases where operations, previously classified as discontinued operations, are now continuing operations, disclosures of the prior periods are adjusted accordingly.
Basic earnings per share (Basic EPS) are calculated by dividing the profit after tax that is attributable to the shareholders of the parent company with the weighted average number of ordinary shares outstanding during the period, excluding the average number of ordinary shares acquired as treasury shares.
Diluted earnings per share are calculated by dividing the profit after tax that is attributable to the shareholders of the parent company (after adjusting for the post tax interest expense of the convertible securities) with the weighted average number of ordinary shares during the period (adjusted for diluted shares).
The weighted average number of ordinary shares outstanding during the accounting period as well as during all presented accounting periods is adjusted in relation to the events that have altered the number of outstanding ordinary shares without the corresponding alteration of the resources.
The Company's BoD is the main corporate body responsible for business decision-making. The BoD reviews all of the internal financial reports in order to assess the Company's and Group's performance and resolve upon the allocation of resources. The Management has set the operating segments based on the said internal reports. The BoD uses different criteria in order to assess the Group's activities which vary according to the nature of each segment, taking into consideration the risks involved and their cash requirements.
MIG's operating segments are defined as the segments in which the Group operates and on which the Group's management information systems are based.
It should be noted that due to the aggregation criteria and the nature of MIG's activities (buyouts and equity investments) some of the subsidiaries present or may present similar performance on a long-term basis as if they were operating in the same segment and hence are aggregated and considered as one operating segment. For the segmentation, the following have been taken into consideration:
Following the application of IFRS 8, six operating segments based on the Management's approach have been identified. The operating segments of the Group and the main consolidated companies (subsidiaries and associates) per presented operating segment are presented below:
The Group classifies a long-term asset or a group of long-term assets and liabilities as those held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use.
The basic requirements in order to classify a long-term asset or group of assets as held for sale is that the asset (or group of assets) must be available for sale in its present condition while the sale should be subject only to terms that are usual and customary for sales of such assets, and must also be highly probable.
For the sale to be highly probable, all of the following are to apply:
Immediately before the initial classification of the asset (or group of assets and liabilities) as held for sale, the carrying amount of the asset (or group of assets and liabilities) will be measured in accordance with applicable IFRS.
Long-term assets (or group of assets and liabilities) classified as held for sale are measured (after the initial classification as mentioned above) at the lower of their carrying amounts and fair values less costs to sell and the impairment losses are recorded in the Income Statement. Any increase in fair value under a subsequent valuation is recorded in the Income Statement but not for an amount exceeding the cumulative impairment loss that had been initially recognized.
Starting from the date a long-term asset (or group of assets) is classified as held for sale, depreciation is not recognized on such asset. As at 31/12/2017, the Group had not classified longtern assets or disposal assets groups in this category (see Note 7).
The composition of the Financial Statements in accordance with the International Financial Reporting Standards (IFRS) requires the Management to make judgments, estimates and assumptions which affect assets and liabilities, contingent receivables and liabilities disclosures as well as revenue and expenses during the periods presented.
In particular, amounts included in or affecting the financial statements, as well as the related disclosures, are estimated through making assumptions about values or conditions that can not be known with certainty at the time of preparation of the financial statements and therefore actual results may differ from what has been estimated. An accounting estimate is considered significant when it is material to the financial position and income statement of the Group and requires the most difficult, subjective or complex judgements of the management.
The basic estimates and evaluations referring to data whose development could affect the Financial Statements accounts in the upcoming 12 months are the following:
The basic judgments carried out by the Group's Management (besides the judgments associated with estimates, outlined in note 5.2) which have the most significant impact on the amounts recognized in the Financial Statements mainly relate to the following:
The accounting standards applied by the Group require the classification of financial assets and liabilities upon acquisition into the following categories:
Specific amounts included or affecting the Financial Statements and the relevant disclosures are estimated via assumptions on values or conditions, which cannot be known with certainty at the time when the Financial Statements are being composed. An accounting estimate is considered important when it is important for the financial condition and the Group results, requiring the most subjective or complex judgments by the Management. The Group evaluates such estimates on a continuous basis, based on past results and experience, meetings with experts, trends and other methods deemed reasonable under the specific conditions; along with forecasts on how these will change in the future.
At initial recognition, the assets and liabilities of the acquired business are included in the consolidated Financial Statements at their fair value. Upon fair values measurements, the Management makes estimates on future cash flows; however, actual results may differ. Any change in the measurement after the initial recognition will affect the measurement of goodwill. Details on the acquired assets and liabilities are analyzed in Note 6.
The Group conducts a related impairment test of investments in subsidiaries and associates whenever there is evidence of impairment in accordance with the provisions of IAS 36. If it is established that there are reasons for impairment, it is necessary to calculate value in use and fair value less costs to sell regarding every CGU. Recoverable amounts of CGUs are determined for impairment tests purposes, based on the value in use calculation, which requires making estimates.
For the purpose of calculating value in use, estimated cash flows are discounted to their present value using a discount rate that reflects current market assessments of the time value of money as well as the risks associated with particular CGU. Calculation uses cash projections based on business-approved business plans. These business plans and cash flow projections usually cover a five-year period. Cash flows beyond the period when projections are available are projected at the estimated growth rates. The key assumptions used to determine the recoverable amount of various CGUs and sensitivity analyzes are reported in Note 10 to the Financial Statements.
The Group carries out the relevant impairment test on goodwill and intangible assets with indefinite useful life derived from subsidiaries and associates, at least on an annual basis or in case of an indication for impairment, according to IAS 36. In order to determine whether there is impairment evidence, the value in use as well as the fair value less the sale cost of the business unit must be calculated. Usually, methods such as present value of estimated cash flows are used along with valuations based on similar transactions or companies trading in active markets and the stock quotation. For the application of these methods, the Management is required to use information such as the subsidiary's forecasted future profitability, business plans as well as market data such as interest rates etc. (for further information please refer to notes 10 and 39 to Financial Statements).
Tangible assets are tested for impairment in case of events or changes in the circumstances suggesting that the accounting value may not be recoverable. In order to estimate the current value in use, the Management estimates future cash flows arising from the asset or cash generating unit and chooses the suitable discount rate in order to estimate the present value of the future cash flows (further information is provided in Note 9).
The Management examines the useful life of depreciated assets every financial year. On 31/12/2017, the Management estimates that the useful lives represent the anticipated remaining useful life of the assets.
The calculation of the fair value of financial assets and liabilities for which there are no public market prices, requires the use of specific valuation techniques. The measurement of their fair value requires different types of estimates. The most important estimates include the assessment of different risks to which the instrument is exposed to such as business risk, liquidity risk etc., and the assessment of the future profitability prospects in the case of equity securities valuation.
The Group follows the provisions of IAS 39 to assess whether an investment has been impaired which is included in the scope of this particular Standard, while the rest of the assets follow the requirements of IAS 36. In judging when an investment has suffered impairment the Group examines, among other factors, the duration or the extent to which the fair value of an investment is lower than its cost which might provide sufficient evidence objectively that the investment has been impaired as well as its financial viability and short-term business prospects, the business policies, the future of the investment, including factors such as the industry and business sector's performance, changes in technology and of the operating and financing cash flows (further information is presented in Note 10).
The Group uses derivatives to manage a series of risks including risks relevant to interest rates, foreign currency and prices of goods. In order to assess the effectiveness of a hedging procedure, the Group is required to firstly state its hedging strategy and then to assess that the hedge will be effective throughout the duration of the hedging instrument (derivative). See further information on derivatives in Note 29.
The provision for income tax based on IAS 12 is calculated by estimating the taxes to be paid to tax authorities and includes the current income tax for every financial year and a provision for additional taxes that might emerge in tax audits.
The Group's companies are subject to various income taxation legislations. To determine the total provision for income tax, as presented in the Statement of Financial Position, significant estimates are required. For specific transactions and calculations, the final tax determination is uncertain. The Group recognizes liabilities for the forecasted tax issues based on calculations as to the extent to which additional tax will arise. In cases where the final tax amount differs from what had been initially recognized, the differences affect the provisions for income tax and deferred tax for the period when it had been determined (for further information please refer to Note 43).
A deferred tax asset is recognized for all unused taxable losses to the extent that it will be possible to have sufficient tax gains to be offset with taxable losses. In order to determine the amount of a deferred tax asset for recognition, significant judgments and estimates are required from the Group's Management, based on future tax profits combined with future tax strategies to be pursued (for further information please refer to Note 17).
The Group makes provisions for doubtful debts concerning specific customers when data or indications highlight that collecting a receivable is totally or partially improbable. The Group's Management examines periodically the provision adequacy on doubtful debts based on the entity's credit policy and taking into account information from the Group's Legal Department derived from analyzing historical data and recent developments of litigation cases (for further information please refer to Note 19).
Estimates relating to fair value measurement of investment property are determined based on appraisal reports carried out by independent real estate appraisal firm, which assess the fair value of investment property according to international accepted appraisal methods. The most appropriate indication of fair value is the existing current values in an active market for relevant rental and other agreements. In case that the abovementioned information is not available, the value is
determined through a range of reasonable estimates of fair values. In most cases, Discounted Cash Flows was assessed as the most appropriate valuation method, since the real estate properties are held by the Group for investment purposes and they are already leased or planned to be leased. Discounted cash flows models are based on reliable estimates of future cash flows, which derive from the lease terms of existing rentals and (where possible) from external data, such as current rentals for similar properties in the same location and condition, using discount rates which depict the current market estimate regarding the uncertainty of the amount and timing of these cash flows. The application of discounted cash flow models, involves the use of assumptions to estimate fair value, which are relate to: receipt of contractual rentals, expected future market rentals, vacancy periods, maintenance expenses and appropriate discount rates. Further information regarding the key assumptions are included in note 49.2.
The provision amount for personnel compensation is based on an actuarial study. The actuary's study includes specific assumptions on discount rate, employees' remuneration increase rate, consumer price index increase and the expected remaining working life. The assumptions used are imbedded with significant uncertainty and the Group's Management continuously reassesses these assumptions (for further information please refer to Note 25).
The Group makes estimates regarding the outcome of construction contracts and the total estimated contract cost based on which the completion percentage is calculated. Where the outcome of a construction contract cannot be estimated reliably (e.g. the construction contracts are at an early stage), then the Group reviews the results to the extent that the incurred costs are likely to be recovered, while the costs are recognized in the Income Statement of the period they are incurred.
The recognition of expenses attributable to the development of the Group software programs as intangible assets is made only when it is probable that the future economic benefits of the intangible assets will flow to the entity. Under the assessment of future economic benefits, the Group takes into account the technical ability to complete the intangible asset so that it is available for sale or use, the existence of a market for the product produced by the intangible asset or, if it is going to be used internally, the usefulness of the intangible asset as well as the possibility of a reliable cost measurement which will be attributed to the intangible asset during the period of its development.
The Group is involved in court claims and compensations during its ordinary activities. The Management judges that any settlement would not significantly influence the Group's financial position on 31/12/2017. The Management assesses the outcome of pending legal cases, according to information received from the Legal Department and collaborating legal offices. Such information arises from the recent developments in the legal cases they handle. If it is probable that an outflow of resources will be required to settle the liability and the amount can be estimated reliably, the Management will make the necessary provisions. Defining the amount necessary to settle the liability is based on the Management's estimates and a number of factors that require judgment. Changes in judgments or estimates are likely to result in an increase or decrease in the Group's liabilities in the future. When additional information becomes available, the Group's Management reviews the events, based on which it might have to review its estimates. (see Note 48.3).
In implementing the requirements of IAS 17 regarding the classification of leases, there are cases where a transaction is not always conclusive. In these cases, the Management uses estimates to
determine whether a lease transfers substantially all risks and rewards of ownership from the lessee to the lessor.
Regarding liabilities under Art. 100 Law 4172/2013 – "Claw-Back" and "Rebate" of HYGEIA group, the following measures have been implemented since July 2013:
a) Claw-back regarding costs from hospitalization, diagnostic tests and physiotherapy.
b) Establishment of an escalating percentage against ΕΟPYY's debt for medical, diagnostic tests and physiotherapy expenses of its insured members towards the EOPPY approved private health providers in respect to the aforementioned services, to be paid to EOPYY as a monthly Rebate.
Currently, with the exception of FYs 2013 and 2016, it is impossible to carry out an accurate quantification of Claw-back and Rebate per clinic of HYGEIA group, since EOPYY has not disclosed all the relative parameters (in respect of the segment and the clinics – separately) required for an accurate determination of the corresponding amounts. It is to be noted that the final amounts of Claw-back for the years 2014 and 2015 will arise following the review of submissions regarding all the aforementioned years and the final ratification performed by EOPYY. In any case, the Management estimates that, based on available data, the results of HYGEIA group have already been burdened with sufficient amounts of Claw-back and Rebate throughout the period and no further negative change in the aforementioned amounts is expected.
HYGEIA group proceeded with calculating Claw-back and Rebate as soon as the relative decisions became effective, burdening the financial results of the group with the respective amounts. In particular, the group has impaired receivables from EOPYY for the period 01/01/2013-31/12/2017 by an amount of approximately € 110.2 m following the implementation of Article 100, Par. 5, Law 4172/2013 (Government Gazette 167/23.07.2013) as well as the other subsequent relevant ministerial decisions.
Finally, in October 2016, under Article 52, Law 4430/2016, terms were defined regarding the settlement of postdated receivables from EOPYY, generated prior to and after it has started operating, to collaborating healthcare services providers. In particular, under the provisions of the Article in question, further discounts were provided so that the Organization would be in position, within 2017, to proceed with full settlement of its obligations up to FY 2015 (including the obligation outstanding before 2012). It is to be noted that the collaborating companies of HYGEIA group have already made adequate provisions regarding the stimulations of the Article in question and, therefore, their results are not estimated to incur any additional burdening.
the aforementioned transaction, the total indirect participating interest of VIVARTIA group stands at 99.37%.
On 02/01/2017, VIVARTIA group, through its subsidiary, SERRES RESTAURANTS-PATISSERIES S.A. proceeded with the acquisition of interest of 100% in the company CHOLARGOS RESTAURANTS S.A. for a consideration of € 215k. The aforementioned transaction resulted in goodwill of € 225k which was included in the relative account of the Financial Statements of VIVARTIA group and determined based on fair value of the acquired companies as at the acquisition date.
Within 2017, MIG proceeded with a share capital increase in its subsidiaries MIG REAL ESTATE SERBIA, standing at € 115k, MIG LRE CROATIA, standing at € 25k and TOWER TECHNOLOGY LTD standing at € 5k.
On 21/03/2017, MIG announced the signing of an agreement for the disposal of its total participation in the company SUNCE, corresponding to approximately 49.99% of the share capital thereof, to the company "SUNCE ULAGANJA d.o.o." controlled by the Andabak family being the majority shareholders. On 13/06/2017, the disposal was finalized. In the consolidated annual Financial Statements for the period ended as at 31/12/2017, the Group's participation in Profit / (Loss) of the associate, consolidated under equity method, as well as the results arising from the disposal were included in the account "Profit / (Loss) after tax from discontinued operations".
The transaction consideration stood at € 43 m and was fully paid upon the completion of the transaction.
Regarding the consolidated Financial Statements, profit of € 740k has arisen from the transaction. The amount of profit has been calculated as the balance between the proceeds of the disposal of the participating interest in the aforementioned associate, net of transaction costs, and the book value at the date of the disposal.
The calculations regarding the transaction are presented in the following table:
| Amounts in € '000 | Result from the sale |
|---|---|
| Book value of SUNCE | 41,950 |
| Sale price minus relevant expenses incurred | 42,690 |
| Gains from the sale | 740 |
| Reclassification of other comprehensive income associated with the discontinued operations in the Income Statement |
- |
| Total gain from the sale | 740 |
| Attributable to: | |
| Owners of the parent | 740 |
| Non-controlling interests | - |
The result of discontinued operations regarding the aforementioned company i.e. profits from the disposal amounting to € 740k and Group's share in losses of the associate, i.e. losses from company's operations for the period 01/01-13/06/2017 amounting to € 1,050k were included in the consolidated Income Statement (analytical information is presented in Note 7.6).
It is to be noted that the aforementioned disposal does not effect the separate Financial Statements in any way.
On 08/12/2017, HYGEIA group completed the transfer of its entire stake of 100% in its subsidiaries BIO-CHECK INTERNATIONAL PRIVATE MULTI-MEDICAL FACILITIES S.A. and PRIVATE POLICLINIC WEST ATHENS PRIMARY CARE MEDICINE S.A., held indirectly, to the company AFFIDEA EUROMEDICS HOLDING S.A. for a total consideration of € 350k.
The aforementioned transaction resulted in a profit of € 3,197k for the consolidated Financial Statements, which is included in the results of discontinued operations. The amount of profit has been calculated as the difference between the proceeds of disposal of the participation in those subsidiaries, net of expenses related to the transaction, and their book value as at the disposal date.
Book values of net assets of the aforementioned companies at the disposal date are analytically presented in the following table:
| Amounts in € '000 | Book values as of the date of sale |
|---|---|
| Non-current assets | 426 |
| Current assets | 298 |
| Cash and cash equivalents | 189 |
| Total assets | 913 |
| Non-current liabilities | 307 |
| Current liabilities | 3,453 |
| Total liabilities | 3,760 |
| Total equity Less: Non-controlling interests |
(2,847) - |
| Equity attributable to οwners of the parent | (2,847) |
Respectively, the calculations of the results of the transactions are presented as follows:
| Amounts in € '000 | Result from the sale |
|---|---|
| Book value of BIO-CHECK INTERNATIONAL PRIVATE MULTI-MEDICAL FACILITIES S.A. and PRIVATE POLICLINIC WEST ATHENS PRIMARY CARE MEDICINE S.A. |
(2,847) |
| Sale price minus relevant expenses incurred | 350 |
| Gains from the sale | 3,197 |
| Reclassification of other comprehensive income associated with the discontinued operations in the Income Statement |
- |
| Total gain from the sale | 3,197 |
| Attributable to: | |
| Owners of the parent | 2,250 |
| Non-controlling interests | 947 |
As at 31/12/2017, the Group did not consolidate the sizes of the aforementioned companies, while it included in the consolidated Income Statement the results of discontinued operations of the aforementioned companies, i.e. profit from the disposal of € 3,197k and losses from their operations for the period 01/01-08/12/2017 amounting to € 222k (see note 7.6)
Within the current year, the management of HYGEIA group decided to review potential disposal of its investment in HYGEIA HOSPITAL-TIRANA ShA (hereinafter refereed to as HHT). In particular, the management examining the commitments undertaken by HYGEIA against its subsidiary's bank loans combined with the financial performance of this investment decided to investigate the attraction of potential investors for the divestment of the subsidiary. This is expected to be completed within a period of one year from the date on which the investment is classified as held for sale. In particular, the management has reviewed the commitments undertaken by HYGEIA against its subsidiary's bank loans combined with the financial performance of this investment and has decided to examine attracting potential investors for the subsidiary's divestment. The aforementioned procedures are expected to be completed within a period of one year from the date on which the investment is classified as held for sale.
Based on the above, as at 31/12/2017, the sizes in HHT Statement of Financial Position were classified as a disposal group in accordance with the provisions of IFRS 5 for non-current assets held for sale. As at the disposal group classification date, HYGEIA group measured the disposal group's assets at the lower of their book value and the fair value less costs to sell (in accordance with IFRS 5, par. 15).Loss of € 8,700k was incurred from the comparison of the fair value of the disposal group with the corresponding book value, recognized in the account "Profit / (Loss) from fair value measurement" of the Income Statement of discontinued operations (see note 7.6).
Revenue and expenses, gains and losses related to this discontinued operation are not included in the Group's income from continuing operations for the period 01/01 - 31/12/2017, i.e. losses of € 14,297k (analyzed in losses of € 8,700k from measurement at fair value, losses of € 3,229k from operations during the period 01/01-31/12/2017 and losses of € 2.368k from derecognition of comprehensive income associated with non-current assets classified as held for sale through the income statement ) and are presented as result for discontinued operation. Moreover, the book values of assets and related disposal group liabilities as at 31/12/2017 (see note 7.6) are also presented separately.
The Board of Directors of ATHENIAN ENGINEERING, as per its meeting held on 21/12/2012, decided to proceed with the discontinuing of the company's operations, given the development of the company financials and the market prospects.
Following the above decision, the Group consolidated on 31/12/2017 and 31/12/2016 the assets of the Statement of Financial Position of ATHENIAN ENGINEERING under the full consolidation method, while it included the results from discontinued operations of the aforementioned company for the periods 01/01-31/12/2017 and 01/01-31/12/2016 in the Income Statement, i.e. losses of € 20k and € 12k respectively (see Note 7.6).
The comparative period's discontinued operations include:
The Group's net profit/ loss from discontinued operations for the periods 01/01-31/12/2017 and 01/01-31/12/2016 is analyzed as follows:
| 01/01-31/12/2017 | 01/01-31/12/2016 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Healthcare | Transportation | Private Equity |
Total | Healthcare | Transportation | Private Equity |
Total | ||
| Sales | 21,588 | - | - | 21,588 | 21,840 | - | - | 21,840 | ||
| Cost of sales | (18,978) | - | - | (18,978) | (18,893) | - | - | (18,893) | ||
| Gross profit | 2,610 | - | - | 2,610 | 2,947 | - | - | 2,947 | ||
| Administrative expenses | (4,650) | (23) | - | (4,673) | (4,761) | (16) | - | (4,777) | ||
| Other operating income | 241 | - | - | 241 | 191 | 1 | - | 192 | ||
| Other operating expenses | (73) | - | - | (73) | (228) | - | - | (228) | ||
| Operating profit | (1,872) | (23) | - | (1,895) | (1,851) | (15) | - | (1,866) | ||
| Other financial results | 223 | - | - | 223 | 169 | - | (7,582) | (7,413) | ||
| Financial expenses | (1,807) | - | - | (1,807) | (1,648) | - | - | (1,648) | ||
| Financial income | - | 3 | - | 3 | - | 3 | - | 3 | ||
| Share in net gains/(losses) of companies accounted for by the equity method |
- | - | (1,050) | (1,050) | - | - | 3,105 | 3,105 | ||
| Profit/(Loss) before tax from discontinuing operations |
(3,456) | (20) | (1,050) | (4,526) | (3,330) | (12) | (4,477) | (7,819) | ||
| Income Tax | 5 | - | - | 5 | 6 | - | - | 6 | ||
| Profit/(Loss) after taxes from discontinued operations Derecognition of comprehensive income |
(3,451) | (20) | (1,050) | (4,521) | (3,324) | (12) | (4,477) | (7,813) | ||
| associated with non-current assets classified as held for sale through the income statement |
(2,368) | - | - | (2,368) | - | - | - | - | ||
| Gains /(Losses) on measurement to fair value |
(8,700) | - | - | (8,700) | - | - | - | - | ||
| Gains /(losses) from the sale of the discontinued operations |
3,197 | - | 740 | 3,937 | - | - | - | - | ||
| Result from discontinued operations | (11,322) | (20) | (310) | (11,652) | (3,324) | (12) | (4,477) | (7,813) | ||
| Attributable to: | ||||||||||
| Owners of the parent | (7,954) | (20) | (310) | (8,284) | (2,340) | (12) | (4,477) | (6,829) | ||
| Non-controlling interests | (3,368) | - | - | (3,368) | (984) | - | - | (984) |
Moreover, accounting values of assets and related liabilities classified as held for sale (HYGEIA HOSPITAL-TIRANA ShA) as at 31/12/2017 are analysed as follows:
| 31/12/2017 | |
|---|---|
| Amounts in € '000 | Healthcare |
| ASSETS | |
| Tangible assets | 25,456 |
| Intangible assets | 242 |
| Inventories | 651 |
| Trade and other receivables | 730 |
| Other current assets | 211 |
| Cash, cash equivalents and restricted cash | 69 |
| Assets held for sale | 27,359 |
| LIABILITIES | |
| Long-term borrowings | 11,318 |
| Trade and other payables | 6,636 |
| Short-term debt | 7,606 |
| Other current liabilities | 1,799 |
| Liabilities related to Assets held for sale | 27,359 |
The following table presents the net cash flows from operating, investing and financing activities pertaining to the discontinued operations for the periods 01/01-31/12/2017 and 01/01-31/12/2016:
| 01/01-31/12/2017 | 01/01-31/12/2016 | |||||||
|---|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Healthcare | Transportation | Private Equity |
Total | Healthcare | Transportation | Private Equity |
Total |
| Net cash flows operating activities | 846 | (16) | - | 830 | 842 | 48 | - | 890 |
| Net cash flows from investing activities |
(515) | 3 | - | (512) | (1,142) | 4 | - | (1,138) |
| Net cash flow from financing activities | (120) | - | - | (120) | 249 | - | - | 249 |
| Exchange differences in cash, cash equivalents and restricted cash |
(80) | - | - | (80) | 64 | - | - | 64 |
| Total net cash flow from discontinued operations |
131 | (13) | - | 118 | 13 | 52 | - | 65 |
Basic earnings per share from discontinued operations for the presented annual reporting periods 01/01-31/12/2017 and 01/01-31/12/2016 amount to € (0.0088) and € (0.0073) respectively, while diluted earnings per share from discontinued operations amounted to € (0.0026) and € (0.0047) respectively (for the analysis of the calculation please refer to Note 45).
The Group applies IFRS 8 "Operating Segments", under its requirements the Group recognizes its operating segments based on "management approach" which requires the public information to be based on internal information. The Company's Board of Directors is the key decision maker and sets six (6) operating segments for the Group (see note 4.23). The required information per operating segment is as follows:
Income and results, assets and liabilities per operating segment are presented as follows:
| Amounts in € '000 | Food & Dairy |
Healthcare | Financial Services |
IT & Telecoms |
Transportation | Private Equity * |
Total from continuing operations |
Discontinued operations |
Group |
|---|---|---|---|---|---|---|---|---|---|
| 01/01-31/12/2017 | |||||||||
| Revenues from external customers |
559,932 | 205,950 | - | 34,366 | 260,874 | 18,805 | 1,079,927 | 21,588 | 1,101,515 |
| Intersegment revenues | 5,302 | 22 | - | 3,178 | 10,682 | 5,898 | 25,082 | - | 25,082 |
| Operating profit | 26,351 | 18,632 | (13,215) | (8,203) | 23,829 | (6,577) | 40,817 | (1,895) | 38,922 |
| Depreciation and amortization expense |
(30,011) | (14,888) | (379) | (3,449) | (26,433) | (1,779) | (76,939) | (3,418) | (80,357) |
| Profit/(Loss) before tax, financing, investing results and total depreciation charges |
56,362 | 33,520 | (12,836) | (4,754) | 50,262 | (4,798) | 117,756 | 1,523 | 119,279 |
| Other financial results | 1,479 | (27) | 218 | (33) | (1,169) | (71) | 397 | 223 | 620 |
| Impairment losses | (1,381) | - | - | (2,660) | - | - | (4,041) | - | (4,041) |
| Profits from reversal of impairment losses |
- | - | - | - | 5,326 | - | 5,326 | - | 5,326 |
| Financial income | 91 | 35 | 28 | 202 | 29 | 18 | 403 | 3 | 406 |
| Financial expenses | (26,635) | (9,477) | (36,031) | (3,720) | (18,244) | (4,581) | (98,688) | (1,807) | (100,495) |
| Share in net profit (Loss) of companies accounted for by the equity method |
1,013 | - | - | - | (7,520) | - | (6,507) | (1,050) | (7,557) |
| Profit/(Loss) before income tax |
918 | 9,163 | (48,728) | (14,414) | 2,251 | (11,483) | (62,293) | (4,526) | (66,819) |
| Income tax | (2,384) | 183 | - | 660 | (307) | (179) | (2,027) | 5 | (2,022) |
| Αssets as of 31/12/2017 | 959,418 | 434,916 | 268,494 | 89,299 | 747,937 | 338,420 | 2,838,484 | 27,359 | 2,865,843 |
| Liabilities as of 31/12/2017 | 699,922 | 297,836 | 720,324 | 85,208 | 285,224 | 399,803 | 2,488,317 | 27,359 | 2,515,676 |
| Amounts in € '000 | Food & Dairy |
Healthcare | Financial Services |
IT & Telecoms |
Transportation | Private Equity * |
Total from continuing operations |
Discontinued operations |
Group |
|---|---|---|---|---|---|---|---|---|---|
| 01/01-31/12/2016 | |||||||||
| Revenues from external customers |
566,523 | 205,861 | - | 35,572 | 258,319 | 15,761 | 1,082,036 | 21,840 | 1,103,876 |
| Intersegment revenues | 5,439 | 30 | - | 3,644 | 10,355 | 7,764 | 27,232 | - | 27,232 |
| Operating profit | 15,388 | 14,958 | (17,363) | 967 | 45,496 | (3,753) | 55,693 | (1,866) | 53,827 |
| Depreciation and amortization expense |
(30,768) | (15,508) | (411) | (3,605) | (24,350) | (1,836) | (76,478) | (3,349) | (79,827) |
| Profit/(Loss) before tax, financing, investing results and total depreciation charges |
46,156 | 30,466 | (16,952) | 4,572 | 69,846 | (1,917) | 132,171 | 1,483 | 133,654 |
| Other financial results | (376) | (3,162) | 554 | (31) | (2,593) | (251) | (5,859) | (7,413) | (13,272) |
| Impairment losses | (21,286) | (500) | - | - | (35) | (14,886) | (36,707) | - | (36,707) |
| Profits from reversal of impairment losses |
5,943 | - | - | - | 11,583 | - | 17,526 | - | 17,526 |
| Financial income | 88 | 27 | 76 | 26 | 289 | 13 | 519 | 3 | 522 |
| Financial expenses | (27,647) | (9,772) | (39,413) | (3,619) | (22,605) | (4,422) | (107,478) | (1,648) | (109,126) |
| Share in net profit (Loss) of companies accounted for by the equity method |
885 | - | - | (163) | (2,412) | - | (1,690) | 3,105 | 1,415 |
| Profit/(Loss) before income tax |
(26,992) | 1,551 | (55,947) | (2,820) | 29,723 | (23,498) | (77,983) | (7,819) | (85,802) |
| Income tax | 2,842 | 2,252 | (3) | (1,284) | (705) | (116) | 2,986 | 6 | 2,992 |
| Αssets as of 31/12/2016 | 970,284 | 480,346 | 279,171 | 100,822 | 763,742 | 390,620 | 2,984,985 | - | 2,984,985 |
| Liabilities as of 31/12/2016 | 704,646 | 343,136 | 726,462 | 83,010 | 301,306 | 397,415 | 2,555,975 | - | 2,555,975 |
| Amounts in € '000 | ||||
|---|---|---|---|---|
| 01/01-31/12/2017 | Hospitality Leisure |
Real Estate | Other | Group |
| Revenues from external customers |
11,967 | 6,487 | 351 | 18,805 |
| Profit/(Loss) before income tax |
780 | (12,381) | 118 | (11,483) |
| Αssets as of 31/12/2017 | 63,931 | 270,370 | 4,119 | 338,420 |
Amounts in € '000
| 01/01-31/12/2016 | Hospitality Leisure |
Real Estate | Other | Group |
|---|---|---|---|---|
| Revenues from external customers |
10,655 | 4,963 | 143 | 15,761 |
| Profit/(Loss) before income tax |
(14,904) | (8,814) | 220 | (23,498) |
| Αssets as of 31/12/2016 | 107,044 | 279,084 | 4,492 | 390,620 |
The reconciliation of revenue, operating profit and loss, assets and liabilities of each segment with the respective amounts of the Financial Statements are analyzed as follows:
| Amounts in € '000 | ||
|---|---|---|
| Revenues | 01/01-31/12/2017 | 01/01-31/12/2016 |
| Total revenues for reportable segments | 1,126,597 | 1,131,108 |
| Adjustments for : | ||
| Intersegment revenues | (25,082) | (27,232) |
| Discontinued operations | (21,588) | (21,840) |
| Income statemement's revenues | 1,079,927 | 1,082,036 |
| Amounts in € '000 | ||
| Profit or loss | 01/01-31/12/2017 | 01/01-31/12/2016 |
| Total profit of loss for reportable segments | (66,819) | (85,802) |
| Adjustments for : | ||
| Discontinued operations | 4,526 | 7,819 |
| Profit or loss before income tax | (62,293) | (77,983) |
| Amounts in € '000 | ||
| Profit / (Loss) from discontinued operations |
01/01-31/12/2017 | 01/01-31/12/2016 |
| Profit/(Loss) before tax from discontinued operations |
(4,526) | (7,819) |
| Adjustments for : | ||
| Income tax | 5 | 6 |
| Derecognition of comprehensive income associated with non-current assets classified as held for sale through the income statement |
(2,368) | - |
| Gains /(Losses) on measurement to fair value |
(8,700) | |
| Gains /(Losses) from the sale of the discontinued operations |
3,937 | - |
| Gains/(Losses) for the year after tax from discontinued operations |
(11,652) | (7,813) |
| Amounts in € '000 | ||
| Assets | 31/12/2017 | 31/12/2016 |
| Total assets for reportable segments | 2,838,484 | 2,984,985 |
| Elimination of receivable from corporate headquarters |
(266,093) | (269,545) |
| Non-current assets classified as held for sale |
27,359 | - |
| Entity's assets | 2,599,750 | 2,715,440 |
| Amounts in € '000 | ||
| Liabilities | 31/12/2017 | 31/12/2016 |
| Total liabilities for reportable segments | 2,488,317 | 2,555,975 |
| Amounts in € '000 | ||
|---|---|---|
| Segment results 31/12/2017 | Greece | European countries |
Other countries |
Group |
|---|---|---|---|---|
| Revenues from external customers | 950,149 | 113,883 | 15,895 | 1,079,927 |
| Revenues from external customers (discontinued operations) |
1,920 | 19,668 | - | 21,588 |
| Non-current assets* | 1,925,732 | 102,814 | - | 2,028,546 |
| Amounts in € '000 Segment results as of 31/12/2016 |
Greece | European countries |
Other countries |
Group |
| Revenues from external customers | 964,527 | 103,009 | 14,500 | 1,082,036 |
| Revenues from external customers (discontinued operations) |
1,971 | 19,869 | - | 21,840 |
| Non-current assets as of 31/12/2016* | 1,979,990 | 175,660 | - | 2,155,650 |
* Non-current assets do not include the "Financial Assets" as well as the "Deferred Tax Assets" as in compliance with the provisions of IFRS 8.
The changes in the Group's property, plant and equipment account are analyzed as follows:
| THE GROUP | |||||||
|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Vessels | Airplanes | Land & Buildings |
Machinery & Vehicles |
Furniture & Fittings |
Construction in progress |
Total |
| Gross book value as of 01/01/2017 | 758,583 | 3,505 | 487,805 | 378,204 | 70,170 | 11,249 | 1,709,516 |
| Additions | 600 | - | 2,063 | 11,103 | 4,473 | 12,783 | 31,022 |
| Acquisitions through business combinations | - | - | 330 | 61 | 290 | 202 | 883 |
| Additions from companies consolidated by equity method |
- | - | 240 | 155 | 354 | 228 | 977 |
| Disposals from sale of subsidiaries | - | - | (732) | (950) | (313) | - | (1,995) |
| Additions of assets classified as held for sale | - | - | 84 | 116 | 152 | - | 352 |
| Disposals / Write-offs | - | (3,505) | (3,073) | (3,720) | (2,759) | (42) | (13,099) |
| Disposals of assets classified as held for sale | - | - | - | (1,108) | - | - | (1,108) |
| Reversal of impairment | 5,326 | - | - | - | - | - | 5,326 |
| Exchange differences on cost of assets classified as held for sale |
- | - | 600 | (673) | 55 | - | (18) |
| Assets classified as held for sale | - | - | (35,666) | (12,859) | (3,632) | (1) | (52,158) |
| Reclassifications | - | - | 7,306 | 5,204 | 294 | (12,804) | - |
| Other adjustments | - | - | - | - | - | (237) | (237) |
| Gross book value as of 31/12/2017 | 764,509 | - | 458,957 | 375,533 | 69,084 | 11,378 | 1,679,461 |
| Accumulated depreciation as of 01/01/2017 | (199,554) | (1,530) | (102,000) | (216,133) | (56,513) | - | (575,730) |
| Depreciation charge | (25,538) | (43) | (12,525) | (24,373) | (4,517) | - | (66,996) |
| Accumulated depreciations of acquisitions through business combinations |
- | - | (125) | (60) | (190) | - | (375) |
| Depreciation of disposals / write-offs | - | 1,573 | 3,072 | 3,628 | 2,375 | - | 10,648 |
| Depreciation of assets classified as held for sale |
- | - | (625) | (2,257) | (162) | - | (3,044) |
| Depreciation charge of assets of sold subsidiaries |
- | - | (69) | (66) | (8) | - | (143) |
| Depreciations of disposal assets classified as held for sale |
- | - | - | 1,029 | - | - | 1,029 |
| Accumulated depreciations of sold subsidiaries |
- | - | 536 | 890 | 306 | - | 1,732 |
| Accumulated depreciations of assets classified as held for sale |
- | - | 4,575 | 10,169 | 3,260 | - | 18,004 |
| Exchange differences on cost | - | - | - | - | 1 | - | 1 |
| Exchange differences on cost of assets classified as held for sale |
- | - | (72) | 750 | (50) | - | 628 |
| Accumulated depreciation as of 31/12/2017 | (225,092) | - | (107,233) | (226,423) | (55,498) | - | (614,246) |
| Net book value as of 31/12/2017 | 539,417 | - | 351,724 | 149,110 | 13,586 | 11,378 | 1,065,215 |
MARFIN INVESTMENT GROUP HOLDING S.A., 67 Thiseos Ave, 146 71 Kifissia, Greece
| THE GROUP | |||||||
|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Vessels | Airplanes | Land & Buildings |
Machinery & Vehicles |
Furniture & Fittings |
Construction in progress |
Total |
| Gross book value as of 01/01/2016 | 745,349 | 3,540 | 496,750 | 377,990 | 67,304 | 4,874 | 1,695,807 |
| Additions | 1,651 | - | 5,102 | 5,723 | 4,925 | 12,914 | 30,315 |
| Acquisitions through business combinations | - | - | 117 | 4 | 226 | - | 347 |
| Disposals from sale of subsidiaries | - | - | (117) | (18) | (95) | - | (230) |
| Disposals / Write-offs | - | - | (2,994) | (3,668) | (2,250) | - | (8,912) |
| Impairment of tangible assets | - | (35) | (12,745) | (6,353) | - | - | (19,133) |
| Reversal of impairment | 11,583 | - | - | - | - | - | 11,583 |
| Exchange differences on cost | - | - | (14) | (6) | (5) | - | (25) |
| Reclassifications | - | - | 1,706 | 4,416 | 65 | (6,187) | - |
| Other adjustments | - | - | - | 116 | - | (352) | (236) |
| Gross book value as of 31/12/2016 | 758,583 | 3,505 | 487,805 | 378,204 | 70,170 | 11,249 | 1,709,516 |
| Accumulated depreciation as of 01/01/2016 | (175,981) | (1,356) | (91,413) | (192,658) | (53,679) | - | (515,087) |
| Depreciation charge | (23,573) | (174) | (13,566) | (27,254) | (4,806) | - | (69,373) |
| Accumulated depreciations of acquisitions through business combinations |
- | - | (100) | (4) | (198) | - | (302) |
| Depreciation of disposals / write-offs | - | - | 2,986 | 3,416 | 2,168 | - | 8,570 |
| Accumulated depreciations of sold subsidiaries |
- | - | 10 | 6 | 25 | - | 41 |
| Exchange differences on cost | - | - | 83 | 467 | (23) | - | 527 |
| Other adjustments | - | - | - | (106) | - | - | (106) |
| Accumulated depreciation as of 31/12/2016 | (199,554) | (1,530) | (102,000) | (216,133) | (56,513) | - | (575,730) |
| Net book value as of 31/12/2016 | 559,029 | 1,975 | 385,805 | 162,071 | 13,657 | 11,249 | 1,133,786 |
Property, plant and equipment are subject to impairment test whenever events and circumstances indicate that the carrying value may not be recoverable. If the carrying value of property, plant and equipment exceeds their recoverable value, the excess amount refers to impairment loss which is recognized directly in the results. The largest amount that arises from comparing the fair value of the asset, after excluding the costs incurred for the sale, and value in use, constitutes the recoverable value of the asset.
In FY 2017, there was no need to recognize impairment losses on property, plant and equipment for the Group and the Company. Moreover, an impairment reversal of property, plant and equipment arose for the year 2017 for the Group amounting to € 5,326k as opposed to € 11,583k for 2016. The total of the aforementioned reversal of impairment pertains to reversal of vessel impairments belonging to the "Transportation" operating segment. The recoverable amount has been defined based on fair value, as evaluated by independent valuation companies, less disposal expenses.
The changes in the Company's property, plant and equipment account are analyzed as follows:
| THE COMPANY | |||||||
|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Land & Buildings |
Machinery & Vehicles |
Furniture & Fittings |
Total | |||
| Gross book value as of 01/01/2017 | 3,710 | 406 | 1,401 | 5,517 | |||
| Additions | - | 5 | 2 | 7 | |||
| Disposals / Recessions | - | (406) | (184) | (590) | |||
| Gross book value as of 31/12/2017 | 3,710 | 5 | 1,219 | 4,934 | |||
| Accumulated depreciation as of 01/01/2017 | (2,866) | (392) | (1,314) | (4,572) | |||
| Depreciation charge | (349) | (5) | (23) | (377) | |||
| Depreciation of disposals / recessions | - | 397 | 178 | 575 | |||
| Accumulated depreciation as of 31/12/2017 | (3,215) | - | (1,159) | (4,374) | |||
| Net book value as of 31/12/2017 | 495 | 5 | 60 | 560 |
| THE COMPANY | |||||||
|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Land & Buildings |
Machinery & Vehicles |
Furniture & Fittings |
Total | |||
| Gross book value as of 01/01/2016 | 3,710 | 447 | 1,348 | 5,505 | |||
| Additions | - | - | 53 | 53 | |||
| Disposals / Recessions | - | (41) | - | (41) | |||
| Gross book value as of 31/12/2016 | 3,710 | 406 | 1,401 | 5,517 | |||
| Accumulated depreciation as of 01/01/2016 | (2,516) | (392) | (1,273) | (4,181) | |||
| Depreciation charge | (350) | (17) | (41) | (408) | |||
| Depreciation of disposals / recessions | - | 17 | - | 17 | |||
| Accumulated depreciation as of 31/12/2016 | (2,866) | (392) | (1,314) | (4,572) | |||
| Net book value as of 31/12/2016 | 844 | 14 | 87 | 945 |
The carrying value of the Group's tangible assets purchased with finance lease amounted to € 5,843k on 31/12/2017 (31/12/2016: € 7,105k), while for the Company it amounted to € 0k on 31/12/2017 (31/12/2016: € 0k).
The carrying value of the Group's tangible assets purchased with finance lease is shown below with a breakdown per category of property, plant and equipment:
| THE GROUP | |||||
|---|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |||
| Vessels | 2,675 | 3,710 | |||
| Land & Buildings | 1 | 1 | |||
| Machinery & Vehicles | 2,906 | 3,057 | |||
| Furniture & Fittings | 261 | 337 | |||
| Total | 5,843 | 7,105 |
Changes in goodwill in the consolidated Financial Statements for the year which ended on 31/12/2017 and 31/12/2016 are as follows:
| Amounts in € '000 | Food & Dairy | Healthcare | Transportation | IT & Telecoms | Private Equity |
Total |
|---|---|---|---|---|---|---|
| Net book value as of 01/01/2016 | 156,141 | 14,551 | 22,662 | 47,273 | 2,141 | 242,768 |
| Acquisition - consolidation of subsidiaries | 255 | - | - | 70 | - | 325 |
| Impairment of goodwill | (3,179) | - | - | - | (2,141) | (5,320) |
| Net book value as of 31/12/2016 | 153,217 | 14,551 | 22,662 | 47,343 | - | 237,773 |
| Νet book value as of 01/01/2017 | 153,217 | 14,551 | 22,662 | 47,343 | - | 237,773 |
| Acquisition - consolidation of subsidiaries | 2,965 | - | - | - | - | 2,965 |
| Net book value as of 31/12/2017 | 156,182 | 14,551 | 22,662 | 47,343 | - | 240,738 |
| Gross book value as of 31/12/2017 | 999,619 | 38,194 | 163,650 | 47,343 | 18,670 | 1,267,476 |
| Accumulated impairment losses | (843,437) | (23,643) | (140,988) | - | (18,670) | (1,026,738) |
| Net book value as of 31/12/2017 | 156,182 | 14,551 | 22,662 | 47,343 | - | 240,738 |
No need to recognize impairment losses regarding recognized goodwill has arisen from the impairment test conducted at the reporting period closing.
Additions for the annual period, totally amounting to € 2,965k pertain to goodwill arising from acquisitions performed during 2017 by VIVARTIA group (please refer to 6.1 and 6.2).
On 31/12/2017, an impairment test was conducted on recognized goodwill and consequently, on recognized intangible assets with indefinite useful life. The impairment test on goodwill which had arisen as a result of the acquisitions of the Group's consolidated companies, was conducted having allocated said assets to the respective Cash Generating Units (CGU). The recoverable goodwill amount associated with the respective CGU was determined through value in use, which was calculated by using the method of discounted cash flows.
Similarly, the recoverable value of trademarks with indefinite useful life (value in use) was determined through the income expected to arise from royalties based on the Income Approach via Relief from Royalty method. The recoverable value of the hospital licenses with indefinite useful life (value in use), was determined by the Incremental Cash Flow method. In determining the value in use, the Management uses assumptions that it deems reasonable, based on the best available information which is applicable at the reference date of the Financial Statements (please refer to Note 10.3 for further information).
On 31/12/2017, per CGU, the conditions that led to the recognition of these impairments are as follows:
Food and Dairy Segment: The aforementioned losses resulted from losses recognized in the intangibles of VIVARTIA group. These losses relate to the decrease of Group companies' revenues operating in the above sectors as a result of the prolonged recession in the Greek economy, which has the effect of reducing consumption expenditure.
IT and Telecommunications Segment: The recognized impairments arose from losses recognized in intangible assets of SINGULARLOGIC Group and reflect the Group's Management estimates for a slower recovery of the sector's turnover to pre-crisis levels. This assessment is linked to the slow pace of implementation of the Public Investment Program in IT projects, but also to the slowdown of investment activity of SMEs.
Changes in goodwill during the year 2017 and the way it has been allocated amongst the Group's operating segments are analyzed in Note 10.1 above. From the conducted impairment test, no need arose for derecognition of goodwill.
The intangible assets of the Group, whose analysis is shown in Note 11, include intangible assets with indefinite useful life. From the impairment test with reference date 31/12/2017 a need arose for the recognition of impairment losses on intangible assets amounting to € 4,041k (2016: € 12,179k), of which (i) an amount of € 1,381k pertains to an impairment of intangible assets with indefinite useful life of the "Food and Dairy" operating segment and (ii) an amount of € 2,260k pertains to an impairment of intangible assets with definite useful life and an amount of € 400k pertains to an impairment of intangible assets with indefinite useful life of IT and Telecommunications segment (please refer to Note 11). The aforementioned amounts are included in the item "Other financial results" of the consolidated Income Statement.
Following the conducted impairments, the intangible assets of the Group with indefinite useful life on 31/12/2017 amount to € 382,414k (2016: € 384,195k) and include the following: (a) trademarks of the "Food and Dairy" segment amounting to € 181,832k, (b) trademarks of the "Transportation" segment amounting to € 30,236k, (c) trademarks of the "Healthcare Services" segment amounting to € 70,950k, (d) licenses of the "Healthcare Services" segment amounting to € 86,590k, and (e) trademarks of the "Information Technology and Telecommunications" segment amounting to € 12,806k.
Respectively, in the separate financial statements, the total impairment amount was € 43,146k which pertains to: (i) an amount of € 23,899k from impairments in its participation in VIVARTIA (ii) an amount of € 4,524k from impairments in its participation in ATTICA, (iii) an amount of € 3,979k from impairments in its participation in SINGULARLOGIC, (iv) an amount of € 315k from impairments in its participation in MIG AVIATION HOLDINGS, (v) an amount of € 115k from impairments in its participation in MIG REAL ESTATE SERBIA, (vi) an amount of € 70k from impairments in its participation in MIG LRE CROATIA, (vii) an amount of € 60k from impairments in its participation in MIG ENVIRONMENT S.A. (under liquidation) and (viii) an amount of € 10,184k from impairments in its participation in RKB (see note 12 and 16). The aforementioned amounts are included in the item "Income/(Expenses) from investments in subsidiaries & investment portfolio" of the separate Income Statement.
The recoverable amount of each CGU is determined according to the calculation of the value in use. The calculations for the CGU's recoverable amount were based on the present value of the expected future cash flows. The methodology for determining the value in use is affected (has sensitivity) by the following key assumptions, as adopted by the management for the estimation of future cash flows:
The calculations for determining the recoverable amounts of the CGU's are based on 5-year business plans approved by the Management, which have included the necessary revisions to capture the current economic situation and reflect past experience, projections of studies per sector and other information available from external sources.
The cash flows beyond the 5 year period are extrapolated using the estimated growth rates in perpetuity, as obtained from external sources.
The WACC method reflects the discount rate of future cash flows for each CGU, according to which the cost of equity and the cost of long-term debt and any grants are weighted, in order to calculate the cost of capital of the company. For financial years from 2022 onwards the weighted average cost of capital (WACC in perpetuity) has been redefined due to the expected improvement in economic fundamentals. The basic parameters determining the weighted cost of capital (WACC) include:
o Risk-free return:
Since all cash flows of the business plans are denominated in euro, the yield of ten-year Euro Swap Rate (EUS) was used as the risk-free rate. At the valuation date the ten-year Euro Swap Rate was 0.89 %. The 10-year Greek government bond was not used as risk free rate, given the recognition by the markets of significant risk premium (spread) on the title.
o Country risk premium:
Assumptions of independent sources were taken into account for the calculation of the specific country risk premium. The risk associated with the activity in each market (Greece, Bulgaria, , etc.) , as stated in each specific country risk premium, is included in the Cost of Equity of each company.
o Equity risk premium:
The calculation of the equity risk premium was based on assumptions by independent sources. Betas are evaluated annually based on published market data.
Apart from the above considerations concerning the determination of the value in use of CGUs, no other changes that may affect the rest of the assumptions have come to the Management's attention. Below are the main assumptions adopted by the Management for the estimation of future cash flows, so as to determine the value in use and perform impairment tests:
| Key business plans | WACC | WACC perpetuity | Perpetuity growth | |||
|---|---|---|---|---|---|---|
| assumptions | 2017 | 2016 | 2017 | 2016 | 2017 | 2016 |
| Food and Dairy | 7,9%-9,5% | 10.7%-12.8% | 7,9%-9,5% | 6,8%-7,7% | 2.0% | 2.0% |
| Transportation | 10.4% | 12.0% | 10.4% | 8,2% | 2.0% | 2.0% |
| Healthcare | 7.6% | 8.2%-10.5% | 7.6% | 6,8%-8,2% | 2.0% | 2.0% |
| IT and Telecoms | 8.1% | 12.4% | 8.1% | 7,2% | 2.0% | 2.0% |
The impairments for the reporting period at Group and Company level are presented in Note 38 to the financial statements.
The Management is not currently aware of any other event or condition that could reasonably affect any of the key assumptions underlying the determination of the recoverable amount of the CGUs. Nevertheless, on 31/12/2017, the Group analyzed the sensitivity of the recoverable amounts per CGU through changes in some of the key assumptions disclosed in note 10.3 (Indicatively a change: (i) a percentage point in EBITDA up to 2022 and half a percentage point to EBITDA in
perpetuity, (ii) a percentage point in the discount rate up to 2022 and half a percentage point in the discount rate in perpetuity or (iii) a half-percentage point growth rate in perpetuity). From the relevant analysis it arises that in the case of the above changes an amount of impairment for the Group between € 9.0 m to a maximum of € 43.6 m may result and which concerns the operating segments "Food and Dairy", "Transportation", "Healthcare Services" and "IT and Telecoms".
The intangible assets at Group level for the years 2017 and 2016 are briefly presented in the following tables:
| THE GROUP | ||||||||
|---|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Licences | Customer Relations |
Brand Names |
Computer Software |
Suppliers/distribution agreements |
Know How |
Other | Total |
| Gross book value as of 01/01/2017 | 87,187 | 45,232 | 311,444 | 38,026 | 4,702 | 7,551 | 35,898 | 530,040 |
| Additions | 3 | - | 5 | 2,339 | - | - | 2,641 | 4,988 |
| Disposals | - | - | (3) | (883) | - | - | (628) | (1,514) |
| Acquisitions through business combinations |
- | - | - | 8 | - | - | - | 8 |
| Additions of assets classified as held for sale |
5 | - | - | 31 | - | - | - | 36 |
| Transfer from Investment in associates to Investment in subsidiaries |
- | - | - | - | - | - | 350 | 350 |
| Disposals from Sale of subsidiaries | - | - | - | (135) | - | - | - | (135) |
| Impairment of intangible assets | - | - | (1,781) | - | - | - | (2,260) | (4,041) |
| Assets classified as held for sale | (543) | - | - | (756) | - | - | - | (1,299) |
| Exchange differences on cost of assets classified as held for sale |
9 | - | - | 12 | - | - | - | 21 |
| Other movements/Reclassifications | - | - | - | 47 | - | - | 65 | 112 |
| Gross book value as of 31/12/2017 | 86,661 | 45,232 | 309,665 | 38,689 | 4,702 | 7,551 | 36,066 | 528,566 |
| Accumulated depreciation as of 01/01/2017 |
(428) | (17,585) | (8,795) | (31,315) | (4,702) | (7,551) | (25,458) | (95,834) |
| Depreciation charge | (6) | (2,921) | (575) | (2,946) | - | - | (3,472) | (9,920) |
| Depreciation of disposals | - | - | 3 | 842 | - | - | 628 | 1,473 |
| Depreciation of assets classified as held for sale |
(58) | - | - | (173) | - | - | - | (231) |
| Accumulated depreciation of sold subsidiary |
- | - | - | 135 | - | - | - | 135 |
| Accumulated depreciations of assets classified as held for sale |
454 | - | - | 603 | - | - | - | 1,057 |
| Exchange differences of assets classified as held for sale |
(7) | - | - | (9) | - | - | - | (16) |
| Other movements/Reclassifications | - | - | - | 1 | - | - | - | 1 |
| Accumulated depreciation as of 31/12/2017 |
(45) | (20,506) | (9,367) | (32,862) | (4,702) | (7,551) | (28,302) | (103,335) |
| Net book value as of 31/12/2017 | 86,616 | 24,726 | 300,298 | 5,827 | - | - | 7,764 | 425,231 |
| THE GROUP | ||||||||
|---|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Licences | Customer Relations |
Brand Names |
Computer Software |
Suppliers/distribution agreements |
Know How |
Other | Total |
| Gross book value as of 01/01/2016 | 87,177 | 45,232 | 323,612 | 35,333 | 4,702 | 7,551 | 33,941 | 537,548 |
| Additions | 26 | - | 13 | 2,384 | - | - | 2,404 | 4,827 |
| Disposals | - | - | (2) | (104) | - | - | (866) | (972) |
| Acquisitions through business combinations |
- | - | - | 33 | - | - | 569 | 602 |
| Disposals from Sale of subsidiaries | - | - | - | - | - | - | (150) | (150) |
| Impairment of intangible assets | - | - | (12,179) | - | - | - | - | (12,179) |
| Exchange differences on cost | (16) | - | - | 20 | - | - | - | 4 |
| Other movements/Reclassifications | - | - | - | 360 | - | - | - | 360 |
| Gross book value as of 31/12/2016 | 87,187 | 45,232 | 311,444 | 38,026 | 4,702 | 7,551 | 35,898 | 530,040 |
| Accumulated depreciation as of 01/01/2016 |
(378) | (14,663) | (8,219) | (28,190) | (4,702) | (7,551) | (22,618) | (86,321) |
| Depreciation charge | (67) | (2,922) | (578) | (3,144) | - | - | (3,722) | (10,433) |
| Depreciation of disposals | - | - | 2 | 35 | - | - | 866 | 903 |
| Depreciation charge of assets of sold subsidiaries |
- | - | - | - | - | - | 16 | 16 |
| Exchange differences on cost | 17 | - | - | (15) | - | - | - | 2 |
| Other movements/Reclassifications | - | - | - | (1) | - | - | - | (1) |
| Accumulated depreciation as of 31/12/2016 |
(428) | (17,585) | (8,795) | (31,315) | (4,702) | (7,551) | (25,458) | (95,834) |
| Νet book value as of 31/12/2016 | 86,759 | 27,647 | 302,649 | 6,711 | - | - | 10,440 | 434,206 |
Within the year, total impairment losses of € 4,041k were recognized on the value of intangible assets (31/12/2016: € 12,179k), which have impacted the Group's consolidated results from continuing operations (see Note 10.2). This amount pertains to impairment losses over intangible assets with indefinite useful life (€ 1,781k) and impairment losses over intangible assets with definite useful life (€ 2,260k).
The intangible assets at Company level for the years 2017 and 2016 are briefly presented in the following table and pertain solely to software programs:
| THE COMPANY | |||
|---|---|---|---|
| 31/12/2017 | 31/12/2016 | ||
| 686 | 686 | ||
| (2) | - | ||
| 684 | 686 | ||
| (681) | (678) | ||
| (2) | (3) | ||
| 1 | - | ||
| (682) | (681) | ||
| 2 | 5 | ||
The Company's subsidiaries are presented in Note 2.
The book value of the investments in subsidiaries is analyzed as follows:
| Amounts in € '000 | THE COMPANY | |||
|---|---|---|---|---|
| Company | 31/12/2017 | 31/12/2016 | ||
| HYGEIA S.A. / MARFIN CAPITAL S.A. | 211,858 | 211,858 | ||
| ATTICA HOLDINGS S.A. / MIG SHIPPING S.A. | 433,497 | 438,021 | ||
| VIVARTIA S.A. | 418,326 | 442,225 | ||
| MIG LEISURE LIMITED | 7,145 | 7,145 | ||
| MIG REAL ESTATE (SERBIA) B.V. | - | - | ||
| MIG LEISURE & REAL ESTATE CROATIA B.V. | 55 | 43,000 | ||
| MIG AVIATIΟN HOLDINGS LTD | 104 | 2,270 | ||
| MIG ENVIRONMENT S.A. | - | 60 | ||
| SINGULARLOGIC S.A. / TOWER TECHNOLOGY HOLDINGS (OVERSEAS) LIMITED |
25,519 | 29,493 | ||
| MIG MEDIA S.A. | 75 | 75 | ||
| ATHENIAN ENGINEERING S.A. | - | - | ||
| Total | 1,096,579 | 1,174,147 |
The analysis of the "Investments in subsidiaries" account for the current and previous year is as follows:
| THE COMPANY | |||
|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |
| Opening balance | 1,174,147 | 1,241,924 | |
| Changes in share capital of subsidiaries | (44,606) | (13,022) | |
| Loss from investment in subsidiaries and associates at fair value recognised in profit and loss |
(32,962) | (54,755) | |
| Closing balance | 1,096,579 | 1,174,147 |
In compliance with the applied accounting policies and provisions of IAS 36, the Group conducts a relevant impairment test regarding its assets at the end of each reporting period. The relevant test can be conducted earlier if there is evidence of possible impairment loss. The test conducted, focuses both on endogenous as well as exogenous parameters.
During the year which ended on 31/12/2017, an impairment arose on the value of investments in subsidiaries amounting to € 32,962k in total. The aforementioned amount is included in the "Expenses/(Income) from investments and financial assets in the trading portfolio" of the company's Income Statement (see Note 10.2.2).
The following table presents the subsidiaries with significant percentage of non-controlling interest:
| Proportion of ownership interests and voting rights held by the NCI |
Total comprehensive income allocated to NCI |
Accumulated NCI presented in Statement of Financial Position |
||||
|---|---|---|---|---|---|---|
| Name of the subsidiary | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| VIVARTIA GROUP | 7.92% | 7.92% | 2,987 | 791 | 33,228 | 33,579 |
| HYGEIA GROUP | 29.62% | 29.62% | 134 | 140 | 36,388 | 37,238 |
| ATTICA GROUP | 10.62% | 10.62% | 234 | 3,665 | 46,566 | 46,332 |
The financial information regarding consolidated groups in which non-controlling interests hold a significant percentage is presented below as follows:
| Amounts in € '000 | VIVARTIA GROUP | HYGEIA GROUP | ATTICA GROUP | |||
|---|---|---|---|---|---|---|
| Statement of Financial Position | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Non-Current Assets | 721,392 | 724,246 | 344,421 | 390,301 | 610,021 | 624,378 |
| Current Assets | 238,026 | 246,038 | 90,459 | 90,004 | 136,490 | 135,935 |
| Total Assets | 959,418 | 970,284 | 434,880 | 480,305 | 746,511 | 760,313 |
| Amounts in € '000 | VIVARTIA GROUP | HYGEIA GROUP | ATTICA GROUP | ||||
|---|---|---|---|---|---|---|---|
| Statement of Financial Position | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | |
| Non-current liabilities | 151,352 | 157,024 | 209,729 | 97,981 | 226,841 | 242,004 | |
| Current Liabilities | 548,570 | 547,622 | 88,104 | 245,151 | 58,364 | 59,211 | |
| Total liabilities | 699,922 | 704,646 | 297,833 | 343,132 | 285,205 | 301,215 | |
| Equity attributable to οwners of the parent | 226,268 | 232,059 | 100,659 | 99,935 | 414,740 | 412,766 | |
| Non-controlling interests | 33,228 | 33,579 | 36,388 | 37,238 | 46,566 | 46,332 | |
| Amounts in € '000 | VIVARTIA GROUP | HYGEIA GROUP | ATTICA GROUP | |||
|---|---|---|---|---|---|---|
| Income Statement /Statements of Comprehensive Income |
01/01- 31/12/2017 |
01/01- 31/12/2016 |
01/01- 31/12/2017 |
01/01- 31/12/2016 |
01/01- 31/12/2017 |
01/01- 31/12/2016 |
| Sales | 565,234 | 571,962 | 205,972 | 227,731 | 271,541 | 268,614 |
| Profit /(Loss) for the year attributable to owners of the parent |
(4,545) | (24,970) | (1,352) | 404 | 1,903 | 26,292 |
| Profit /(Loss) for the year attributable to NCI | 3,060 | 856 | (620) | 81 | 226 | 3,123 |
| Profit or Loss for the year | (1,485) | (24,114) | (1,972) | 485 | 2,129 | 29,415 |
| Other comprehensive income for the year | (661) | (563) | 2,496 | 205 | 79 | 5,110 |
| Total comprehensive income for the year attributable to owners of the parent |
(5,133) | (25,468) | 390 | 550 | 1,974 | 30,860 |
| Total comprehensive income for the year attributable to NCI |
2,987 | 791 | 134 | 140 | 234 | 3,665 |
| Total comprehensive income for the year | (2,146) | (24,677) | 524 | 690 | 2,208 | 34,525 |
| Dividends paid to non-controlling interests | (1,611) | (2,683) | - | (2) | - | - |
| Amounts in € '000 | VIVARTIA GROUP HYGEIA GROUP |
ATTICA GROUP | ||||
|---|---|---|---|---|---|---|
| Statement of cash flows | 01/01- 31/12/2017 |
01/01- 31/12/2016 |
01/01- 31/12/2017 |
01/01- 31/12/2016 |
01/01- 31/12/2017 |
01/01- 31/12/2016 |
| Net cash flows from operating activities | 28,422 | 31,278 | 9,276 | 7,679 | 25,666 | 45,817 |
| Net cash flow from investing activities | (19,747) | (24,787) | (6,472) | (4,959) | (7,113) | (10,813) |
| Net cash flow from financing activities | (9,403) | (2,635) | (6,401) | (2,171) | (25,637) | (55,325) |
| Net (decrease) / increase in cash, cash equivalents and restricted cash |
(728) | 3,856 | (3,597) | 549 | (7,084) | (20,321) |
| Cash, cash equivalents and restricted cash at the beginning of the year |
60,674 | 56,818 | 14,854 | 14,241 | 51,220 | 71,555 |
| Exchange differences in cash, cash equivalents and restricted cash from continuing operations |
- | - | (80) | 64 | (37) | (14) |
| Net cash, cash equivalents and restricted cash at the end of the year |
59,946 | 60,674 | 11,177 | 14,854 | 44,099 | 51,220 |
Note.: Consolidated amounts before adjustments from the wider Group.
The Group holds no investment in non-consolidated structured entities.
The Group has the following investments in related companies that due to significant influence, are classified as associates and are consolidated based on the equity method in the consolidated Financial Statements (the scope of operations and the Group's participating interest in these investments are presented in Note 2 to the financial statements).
Based on the contribution of the associates to the Group's profit /(loss) before tax, the Group decided that each of the associates individually is material and thus, it discloses in the table below its aggregated participating interest in these associates:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |
| Profit or loss from continuing operations | (6,507) | (1,690) | |
| Post-tax profit/(loss) from discontinued operations | (1,050) | 3,105 | |
| Other comprehensive income | - | 77 | |
| Total comprehensive income | (7,557) | 1,492 | |
| Aggregate carrying amount of the Group's interests in these associates |
17,119 | 59,342 |
The changes in the associates in the Group's Statement of Financial Position account are as follows:
| THE GROUP | |||||
|---|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |||
| Opening balance | 59,342 | 49,224 | |||
| Acquisitions of associates | - | 745 | |||
| Sales of associates | (43,236) | - | |||
| Changes of share capital | 5,854 | 3,000 | |||
| Dividends | - | (68) | |||
| Transfer from investing portfolio | - | 421 | |||
| Transfer from other current assets | - | 3,800 | |||
| Impairment losses recognised in P&L | - | (7,582) | |||
| Impairment losses reversed in P&L | - | 5,943 | |||
| Share in net profit/(loss) of companies accounted for by the equity method |
(6,507) | 3,782 | |||
| Other movements | 1,666 | 77 | |||
| Closing balance | 17,119 | 59,342 |
Within the first half of 2017, on 13/06/2017 the disposal of MIG's total participation in the company SUNCE was finalized versus a consideration of € 43 m. The result of the transaction stood at profit of € 0.7 m recorded in the consolidated Financial Statements (see Note 7.1).
Within the first six-month period of 2017, share capital increases were performed in the associate of ATTICA group, AFRICA MOROCCO LINKS, totaling € 11,9478k, with the participation of ATTICA group standing at € 5,854k. From the above amount, an amount of € 1 m was in cash, while an amount of € 4,854k pertained to capitalization of receivables. The group's share in the Profit/Loss of the Company, which is consolidated under the equity method, amounting to € (7,520)k, has been included in the item "Profit/ (Loss) from associates consolidated under equity method" in the Consolidated Income Statement for FY 2017. The amount in question, regarding the component exceeding the book value of the associate, was offset with ATTICA group's receivables from AML, which are included in the item "Other Current Assets".
The Group's investment portfolio is analyzed as follows:
| THE GROUP | ||
|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 |
| Shares listed in foreign stock exchanges | 122 | 109 |
| Non-listed domestic shares | 5,228 | 228 |
| Mutual funds | - | 131 |
| Other financial instruments | 3 | 3 |
| Total financial assets of investment portfolio | 5,353 | 471 |
The changes in the Group's investment portfolio are presented as follows:
| THE GROUP | ||
|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 |
| Opening balance | 471 | 888 |
| Additions | 5,000 | - |
| Disposals | (1,128) | - |
| Increase / (Decrease) in equity from fair value adjustments | 7 | 8 |
| Exchange differences | 6 | (4) |
| Impairment losses reversed in P&L | 997 | - |
| Transfer to Investments in associates | - | (421) |
| Closing balance | 5,353 | 471 |
Additions to the investment portfolio pertain to acquisition of 1,250,000 shares of the company HELLENIC SEAWAYS ANE by ATTICA group in the context of the agreement on acquisition of 50.3% of HELLENIC SEAWAYS ANE. The agreement is subject to the approval of the competent regulatory and other authorities.
The Group's investments in property are defined based on the fair value method of IAS 40 as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |
| Opening net book value | 275,225 | 280,067 | |
| Additions | 1,696 | 2,765 | |
| Disposals | (28) | (330) | |
| Fair value adjustments Investment properties | (10,942) | (7,277) | |
| Other changes | (73) | - | |
| Closing net book value | 265,878 | 275,225 |
Investment properties as of 31/12/2017 mainly include the properties of the subsidiary RKB amounting to € 265,711k. These properties are burdened with liens securing borrowing of RKB (see Note 48.2). Within 2017, the Group performed a reassessment of the fair value of RKB's investment property by appointing an independent real estate appraisal firm. Following the reassessment of the said investment property, a decrease in fair value arose, amounting to € 10,942k, that is included in the item "Other operating expenses" of the consolidated Income Statement for the year 2017.
Moreover, the following amounts, related to the investment properties, have been recognized in the Income Statement for the year:
| Amounts in € '000 | 01/01- 31/12/2017 |
01/01- 31/12/2016 |
|---|---|---|
| Ιncome from leases from investment property | 9,166 | 7,383 |
| Operating expenses related to investment property from which the Group received income from leasing |
2,679 | 2,420 |
| Operating expenses related to investment property from which the Group did not received income from leasing |
1,433 | 1,302 |
The other non-current assets for the Group and the Company are presented as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Guarantees | 4,833 | 4,553 | 51 | 51 |
| Other long-term receivables | 9,532 | 9,151 | 10 | 10 |
| Receivables arising from share disposals | - | 1,614 | - | 1,614 |
| Other long-term receivables from related parties | - | - | 251,836 | 251,836 |
| Less:Impairment provisions | - | - | (70,596) | (60,412) |
| Net book value | 14,365 | 15,318 | 181,301 | 193,099 |
The amount of € 251,836k that was raised in 2014 from MIG's CBL was used in order to settle loan liabilities of its subsidiary RKB to PIRAEUS BANK, for which MIG's company guaranty had been provided. PIRAEUS BANK has agreed for the Company to substitute PIRAEUS BANK regarding the loan liabilities which were settled in compliance with applicable legislation and established practices.
Changes in provision for impairment regarding the Company for 2017 and 2016 are presented below as follows:
| THE COMPANY | ||||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | ||
| Balance at the beginning | (60,412) | (53,904) | ||
| Additional provisions | (10,184) | (6,508) | ||
| Closing balance | (70,596) | (60,412) |
Deferred income tax occurs from temporary differences between the book value and the tax bases of the assets and liabilities and is calculated based on the tax rate which is expected to be applicable in the financial years when the temporary taxable and deductible differences are predicted to be reversed.
Deferred tax assets and liabilities are offset when an applicable legal right exists to offset current tax assets against current tax liabilities and when the deferred taxes refer to the same tax authority. A deferred tax asset is recognized in respect to tax losses carried forward to the extent that the realization of a relevant tax benefit is possible through future taxable profits.
The offset amounts for the Group are the following:
| THE GROUP | ||||
|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||
| Amounts in € '000 | Deferred Tax Assets |
Deferred Tax Liabilities |
Deferred Tax Assets |
Deferred Tax Liabilities |
| Tangible assets | - | 68,904 | - | 72,095 |
| Intangible assets | - | 113,319 | - | 115,690 |
| Long-term investments | 384 | - | 673 | - |
| Derivative financial instruments | - | - | - | 7 |
| Trade and other receivables | 9,224 | - | 12,104 | - |
| Other assets | 571 | 2,757 | 845 | 2,754 |
| Other reserves | - | 16 | - | 17 |
| Retained earnings | 10,292 | 1,390 | 8,841 | 989 |
| Accrued pension and retirement obligations | 10,023 | - | 9,625 | - |
| Other long-term liabilities | 3,192 | - | 2,414 | 390 |
| Other current liabilities | 1,150 | 7 | 1,741 | 87 |
| Total | 34,836 | 186,393 | 36,243 | 192,029 |
| Off set deferred tax assets & liabilities | 2,789 | 2,789 | 3,781 | 3,781 |
| Deferred tax asset / (liability) | 37,625 | 189,182 | 40,024 | 195,810 |
It is noted that a deferred tax receivable amounting to € 10,292k has been recognized only in that part of the losses for which the Management estimates with reasonable certainty that they will be offset with future taxable profits within the following five year period.
The Group's inventory is analyzed as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |
| Merchandise | 11,871 | 13,120 | |
| Finished goods | 21,074 | 17,263 | |
| Semi-finished products | 15,536 | 12,472 | |
| Raw materials and other consumables | 23,323 | 22,136 | |
| Fuels and lubricant | 2,515 | 2,702 | |
| Spare parts of tangible assets | 4,728 | 4,308 | |
| Total | 79,047 | 72,001 | |
| Less: Provisions for scrap, slow moving and/or destroyed inventories for the year |
(190) | (1,673) | |
| Less: Provisions for scrap, slow moving and/or destroyed inventories recognized from previous years |
(2,975) | (2,756) | |
| Net book value | 75,882 | 67,572 |
It should be noted that due to the significantly diversified activities of the consolidated companies, the nature of inventories differs. Inventory mainly pertains to VIVARTIA, ATTICA and HYGEIA groups.
The movement in the provisions account in respect to inventories for the Group during the financial years 2017 and 2016 is presented in the following table:
| THE GROUP | ||
|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 |
| Balance at the beginning | (4,429) | (3,698) |
| Additions | (190) | (1,673) |
| Utilised provisions | 1,118 | 829 |
| Exchange differences | - | (12) |
| Decrease from transfer to assets classified as held for sale | 340 | - |
| Additions of assets classified as held for sale | (21) | - |
| Exchange differences of assets classified as held for sale | 17 | - |
| Reclassifications | - | 125 |
| Closing balance | (3,165) | (4,429) |
Trade and other receivables of the Group are analyzed as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |
| Trade receivables | 289,691 | 302,465 | |
| Intercompany accounts receivable | 2,448 | 3,488 | |
| Notes receivable | 14,488 | 21,484 | |
| Checks receivable | 49,602 | 60,481 | |
| Less:Impairment provisions | (141,270) | (163,141) | |
| Net trade receivables | 214,959 | 224,777 | |
| Advances to suppliers | 6,648 | 4,792 | |
| Less:Impairment provisions | (1,195) | (1,146) | |
| Total | 220,412 228,423 |
In respect to trade receivables amounting to € 93,415k, of VIVARTIA group, the Group has received client guaranties amounting to € 28,300k (31/12/2016: € 30,277k).
The Group's trade receivables have decreased by a total amount of € 110.2 m as a result of the implementation of Article 100, par. 5 of Law 4172/2013 (Government Gazette Α' 167/23.07.2013) and the subsequent relevant ministerial decisions regarding Claw-back and Rebate. The impairment refers to receivables of HYGEIA group from EOPYY for the period 01/01/2013-31/12/2017 and has been performed through rebate invoices and provisions [see Note 5.2 (18)].
The total of trade receivables have been examined for potential impairment evidence purposes. Relative indications were identified in respect of particular receivables and provisions for impairment have been made. Impairments performed in 2017 mainly pertain to: (a) trade receivables and FOREX receivables from natural persons to HYGEIA group, and (b) clients balances of VIVARTIA and SINGULARLOGIC groups, regarding which the management, in accordance with the applicable accounting principles of the Group, estimates that there are indications that collecting the relevant receivables in whole or in part is not probable. It is noted that the provisions of the annual comparative period include the impact of the extraordinary impairment on the remaining receivables from Marinopoulos group totaling € 14.6m.
The movement in provisions for the Group's doubtful trade receivables for the financial years ending on 31/12/2017 and 31/12/2016 is as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |
| Balance at the beginning | (164,287) | (148,996) | |
| Additions through acquisitions | (2) | (15) | |
| Additional provisions | (6,616) | (26,431) | |
| Utilised provisions | 27,534 | 9,036 | |
| Reclassifications | 1,004 | - | |
| Provisions for the year of discontinued operations | 36 | - | |
| Transfer from/to disposal groups held for sale | 312 | - | |
| Exchange differences | (441) | 2,119 | |
| Exchange differences of assets classified as held for sale | (5) | - | |
| Total | (142,465) | (164,287) |
Post due and non-impaired trade receivables are analyzed in Note 50.5.
The Group's and Company's other current assets are analyzed as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Other debtors | 39,936 | 28,443 | 264 | 264 |
| Receivables from the state | 13,825 | 12,706 | 175 | 232 |
| Advances and loans to personnel | 726 | 593 | 48 | - |
| Accrued income | 735 | 1,419 | - | - |
| Prepaid expenses | 17,477 | 22,240 | 560 | 154 |
| Receivables arising from share disposals | 1,614 | 10,905 | 1,614 | 10,905 |
| Other receivables | 6,776 | 7,438 | 3,622 | 1,981 |
| Total | 81,089 | 83,744 | 6,283 | 13,536 |
| Less:Impairment Provisions | (11,893) | (12,088) | (264) | (264) |
| Net receivables | 69,196 | 71,656 | 6,019 | 13,272 |
The category Miscellanies Debtors in the consolidated financial statements mainly includes ATTICA group's receivables from AFRICA MOROCCO LINKS, consolidated under the equity method. Receivables from public authorities mainly concern advance and withholding taxes and VAT, which is expected to be collected or offset, as the case may be. Within FY 2017, the Company received the last payment of € 10.4 m arising from the disposal of OLYMPIC AIR and an instalment of € 2.7 m arising from the disposal of SKYSERV.
Changes in impairment provisions for the Group's and the Company's other current assets for the years 2017 and 2016 are as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Balance at the beginning | (12,088) | (11,075) | (264) | (264) |
| Additional provisions | (214) | (1,057) | - | - |
| Utilised provisions | 1,734 | 44 | - | - |
| Reclassifications | (1,424) | - | - | - |
| Discontinued operations | 99 | - | - | - |
| Closing balance | (11,893) | (12,088) | (264) | (264) |
Trading portfolio and the other financial assets at fair value through Profit and Loss consist of investments in mutual funds, bonds and shares that are analyzed as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Greek Government treasury bonds | 45 | 45 | - | - |
| Shares listed in ASE | 25 | 109 | - | 90 |
| Foreign mutual funds | 367 | 2,713 | 367 | 725 |
| Total | 437 | 2,867 | 367 | 815 |
The change of the Group's and the Company's trading portfolio and other financial assets at fair value through the profit & loss is analyzed below:
| THE GROUP | THE COMPANY | ||||
|---|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | |
| Opening balance | 2,867 | 3,981 | 815 | 725 | |
| Additions | - | 856 | - | 856 | |
| Disposals | (2,436) | (1,957) | (448) | (758) | |
| Profit / (loss) from fair value revaluation | 7 | (13) | - | (8) | |
| Decrease - Return of share capital | (1) | - | - | - | |
| Closing balance | 437 | 2,867 | 367 | 815 |
The analysis of the amount of € 437k for the Group on 31/12/2017 is as follows: an amount of € 70k refers to financial assets at fair value through P&L (31/12/2016: € 64k) and an amount of € 367k refers to the trading portfolio (31/12/2016: € 2,803k).
In respect to the Company, the amount of € 367k on 31/12/2017 pertains solely to trading portfolio (31/12/2016: € 815k).
The Group's and the Company's cash, cash equivalents and restricted deposits are analyzed as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Cash in hand | 9,814 | 10,315 | 98 | 99 |
| Cash equivalent balance in bank | 106,054 | 105,236 | 316 | 197 |
| Time deposits | 7,369 | 22,464 | 5,660 | 7,543 |
| Blocked deposits | 7,270 | 4,885 | 3,480 | 2,358 |
| Total cash, cash equivalents and restricted cash | 130,507 | 142,900 | 9,554 | 10,197 |
| Cash, cash equivalents and restricted cash in € | 123,821 | 135,380 | 9,327 | 10,004 |
| Cash, cash equivalents and restricted cash in foreign currency | 6,686 | 7,520 | 227 | 193 |
| Total cash, cash equivalents and restricted cash | 130,507 | 142,900 | 9,554 | 10,197 |
Bank deposits receive a floating interest rate which is based on the banks' monthly deposit interest rates. The interest income on sight and time deposits is accounted for on an accrued basis and is included in "Financial Income" in the Income Statement.
From the restricted deposits of the Group, an amount of € 5,738k (31/12/2016: € 4,490k) pertains to guarantees for credit facilities of the Group's subsidiaries'. The relevant amount for the Company is € 1,955k (31/12/2016: € 1,970k).
The Company's share capital as at 31/12/2017 stands at € 281,853,224.40 fully paid and divided into 939,510,748 ordinary registered shares of € 0.30 nominal value each. Every share of the Company provides one voting right. The share premium account to € 3,874,689k.
The Group's other reserves are analyzed as follows:
| Amounts in € '000 | Statutory Reserve |
Special reserves |
Other reserves |
Translation reserves |
Total |
|---|---|---|---|---|---|
| Opening Balance as of 01/01/2016 | 32,140 | 501 | 2,961 | (1,928) | 33,674 |
| Share capital increase through conversion of convertible bonds |
- | - | (1) | - | (1) |
| Exchange differences | - | - | - | 108 | 108 |
| Closing balance as of 31/12/2016 | 32,140 | 501 | 2,960 | (1,820) | 33,781 |
| THE GROUP | |||||
|---|---|---|---|---|---|
| Amounts in € '000 | Statutory Reserve |
Special reserves |
Other reserves |
Translation reserves |
Total |
| Opening Balance as of 01/01/2017 | 32,140 | 501 | 2,960 | (1,820) | 33,781 |
| Exchange differences | - | - | - | 1,754 | 1,754 |
| Convertible bond loan reserve | - | - | (2,783) | - | (2,783) |
| Closing balance as of 31/12/2017 | 32,140 | 501 | 177 | (66) | 32,752 |
The Company's other reserves are analyzed as follows:
| THE COMPANY | ||||||
|---|---|---|---|---|---|---|
| Amounts in € '000 | Statutory Reserve |
Special reserves | Other reserves | Total | ||
| Opening Balance as of 01/01/2016 | 32,140 | 501 | 3,091 | 35,732 | ||
| Share capital increase through conversion of convertible bonds |
- | - | (1) | (1) | ||
| Closing balance as of 31/12/2016 | 32,140 | 501 | 3,090 | 35,731 |
| THE COMPANY | ||||||
|---|---|---|---|---|---|---|
| Amounts in € '000 | Statutory Reserve |
Special reserves | Other reserves | Total | ||
| Opening Balance as of 01/01/2017 | 32,140 | 501 | 3,090 | 35,731 | ||
| Convertible bond loan reserve | - | - | (2,783) | (2,783) | ||
| Closing balance as of 31/12/2017 | 32,140 | 501 | 307 | 32,948 |
The Group's fair value reserves are analyzed as follows:
| THE GROUP | |||
|---|---|---|---|
| 31/12/2017 | 31/12/2016 | ||
| Amounts in € '000 | Cash flow hedge | Cash flow hedge | |
| Opening Balance 01/01 | 2,085 | (2,581) | |
| Gains/ (losses) from valuation transferred to equity | 6 | 7 | |
| Cash flow hedge | 182 | 4,582 | |
| Share of other comprehensive income of equity accounted investments |
- | 77 | |
| Closing balance 31/12 | 2,273 | 2,085 |
In accordance with the labor legislation of the countries in which the Group operates, employees are entitled to compensation in case of dismissal or retirement. With regards to subsidiaries domiciled in Greece (being the largest part of Group's activities), the amount of compensation varies depending on the employee's salary, the years of service and the mode of stepping down (redundancy or retirement). Employees resigning or dismissed due to justifiable grounds are not entitled to compensation. In case of retirement, a lump sum compensation shall be paid pursuant to Law 2112/20. The Group recognizes as a liability the present value of the legal commitment for the lump sum compensation payment to personnel stepping down due to retirement. These are nonfinanced defined benefit plans according to IAS 19 and the relevant liability was calculated on the basis of an actuarial study.
Apart from the legal commitment for provision of the lump sum to retiring employees, the Group has activated, through its subsidiary HYGEIA, a special employee benefit plan in the form of a group insurance.
The analysis of the liability for employee benefits due to retirement of the Group and the Company is as follows:
| THE GROUP | ||||||
|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||
| Amounts in € '000 | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total |
| Defined benefit obligation | 33,033 | 3,918 | 36,951 | 31,777 | 3,586 | 35,363 |
| Fair value of plan assets | - | 1,186 | 1,186 | - | 728 | 728 |
| 33,033 | 2,732 | 35,765 | 31,777 | 2,858 | 34,635 | |
| Classified as : | ||||||
| Non-Current Liability | 33,033 | 2,732 | 35,765 | 31,777 | 2,858 | 34,635 |
| THE COMPANY | ||||||||
|---|---|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||||
| Amounts in € '000 | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total | ||
| Defined benefit obligation | 209 | - | 209 | 184 | - | 184 | ||
| 209 | - | 209 | 184 | - | 184 | |||
| Classified as : | ||||||||
| Non-Current Liability | 209 | - | 209 | 184 | - | 184 |
| THE GROUP | ||||||
|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||
| Amounts in € '000 | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total |
| Current service costs | 1,252 | 471 | 1,723 | 1,552 | 491 | 2,043 |
| Past service costs | 3,945 | - | 3,945 | 2,817 | - | 2,817 |
| Net Interest on the defined obligation |
588 | 55 | 643 | 656 | 59 | 715 |
| Total expenses recognized in profit or loss |
5,785 | 526 | 6,311 | 5,025 | 550 | 5,575 |
| THE COMPANY | ||||||
|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||
| Amounts in € '000 | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total |
| Current service costs | 23 | - | 23 | 21 | - | 21 |
| Past service costs | 264 | - | 264 | 117 | - | 117 |
| Net Interest on the defined obligation | 3 | - | 3 | 4 | - | 4 |
| Total expenses recognized in profit or loss |
290 | - | 290 | 142 | - | 142 |
The amounts recognized in the Group's and the Company's Statement of Comprehensive Income are as follows:
| THE GROUP | ||||||
|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||
| Amounts in € '000 | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total |
| Actuarial gains /(losses) from changes in financial assumptions |
(412) | (49) | (461) | (1,683) | (136) | (1,819) |
| Actuarial losses (gains) from changes in experience |
(470) | (98) | (568) | 632 | 437 | 1,069 |
| Total income /(expenses) recognized in other comprehensive income |
(882) | (147) | (1,029) | (1,051) | 301 | (750) |
| THE COMPANY | ||||||
|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||
| Amounts in € '000 | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total |
| Actuarial gains /(losses) from changes in financial assumptions |
(3) | - | (3) | (9) | - | (9) |
| Actuarial losses (gains) from changes in experience |
(20) | - | (20) | (7) | - | (7) |
| Total income /(expenses) recognized in other comprehensive income |
(23) | - | (23) | (16) | - | (16) |
The changes in the present value of the defined contribution plan liability of the Group and the Company are as follows:
| THE GROUP | ||||||
|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||
| Amounts in € '000 | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total |
| Defined benefit obligation 1st January |
31,777 | 3,586 | 35,363 | 29,867 | 3,641 | 33,508 |
| Current Service cost | 1,252 | 471 | 1,723 | 1,552 | 491 | 2,043 |
| Interest expense | 588 | 68 | 656 | 656 | 80 | 736 |
| Actuarial losses (gains) in liability | 882 | 158 | 1,040 | 1,051 | (301) | 750 |
| Benefits paid | (5,286) | (365) | (5,651) | (4,169) | (325) | (4,494) |
| Past service cost | 3,945 | - | 3,945 | 2,817 | - | 2,817 |
| Current Service cost discontinued operations |
(176) | - | (176) | - | - | - |
| Past service cost from new aquisitions |
- | - | - | 12 | - | 12 |
| Past service cost from companies consolidated by equity method |
51 | - | 51 | (9) | - | (9) |
| Defined benefit obligation 31st December |
33,033 | 3,918 | 36,951 | 31,777 | 3,586 | 35,363 |
| THE COMPANY | ||||||
|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||
| Amounts in € '000 | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total | Defined benefit plans (Non financed) |
Defined benefit plans (Financed) |
Total |
| Defined benefit obligation 1st January |
184 | - | 184 | 166 | - | 166 |
| Current Service cost | 23 | - | 23 | 21 | - | 21 |
| Interest expense | 3 | - | 3 | 4 | - | 4 |
| Actuarial losses (gains) in liability | 23 | - | 23 | 16 | - | 16 |
| Benefits paid | (288) | - | (288) | (140) | - | (140) |
| Past service cost | 264 | - | 264 | 117 | - | 117 |
| Defined benefit obligation 31st December |
209 | - | 209 | 184 | - | 184 |
| THE GROUP | |||||
|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | ||||
| Amounts in € '000 | Defined benefit plans (Financed) |
Defined benefit plans (Financed) |
|||
| Fair value of plan assets 1st January | 728 | 1,031 | |||
| Interest income | 13 | 23 | |||
| Return on plan assets (excluding amounts included in net interest) |
11 | (2) | |||
| Employer contributions | 799 | - | |||
| Benefits paid | (365) | (324) | |||
| Fair value of plan assets 31st December | 1,186 | 728 |
The assets of the plan can be analyzed into the following investing categories:
| THE GROUP | ||
|---|---|---|
| 31/12/2017 | 31/12/2016 | |
| Amounts in € '000 | Defined benefit plans (Financed) |
Defined benefit plans (Financed) |
| Cash and cash equivalents | 1,186 | 728 |
| Total | 1,186 | 728 |
The main actuarial assumptions applied for the aforementioned accounting purposes are described below:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | |
| Discount rate | 1.80% | 1.90% | 1.80% | 1.90% |
| Expected rate of salary increases | 1.82% | 1.84% | 1.80% | 1.80% |
| Inflation | 1.50% | 1.50% | 1.50% | 1.50% |
The above assumptions were developed by the Management in collaboration with an independent actuary who prepared the actuarial study.
The key actuarial assumptions used for determining the liabilities are the discount rate and the expected change in wages. The following table summarizes the effects on the actuarial liability arising from potential changes in the assumptions.
| THE GROUP | THE COMPANY | |||||||
|---|---|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | |||||
| Amounts in € '000 | Discount rate | Discount rate | Discount rate | Discount rate | ||||
| 0,5% | -0,5% | 0,5% | -0,5% | 0,5% | -0,5% | 0,5% | -0,5% | |
| Increase (decrease) in the defined liability |
(2,600) | 2,563 | (2,374) | 2,407 | (16) | 18 | (14) | 16 |
| Expected rate of salary increases |
Expected rate of salary increases |
Expected rate of salary increases |
Expected rate of salary increases |
|||||
| 0,5% | -0,5% | 0,5% | -0,5% | 0,5% | -0,5% | 0,5% | -0,5% | |
| Increase (decrease) in the defined liability |
2,258 | (2,351) | 2,366 | (2,355) | 12 | (11) | 16 | (15) |
Government grants to the Group pertain to investment grants and their movement during the financial years which ended on 31/12/2017 and 31/12/2016 are as follows:
| THE GROUP | |||||
|---|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 31/12/2016 |
||||
| Opening Balance | 7,721 | 8,592 | |||
| New amounts granted | 68 | - | |||
| Amortization | (843) | (871) | |||
| Closing balance | 6,946 | 7,721 |
The Group's and the Company's borrowings on 31/12/2017 are analyzed as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Long-term borrowings | ||||
| Obligations under finance lease | 3,772 | 5,028 | - | - |
| Bank loans | 147,749 | 206,424 | - | 29,392 |
| Bonds | 869,589 | 923,260 | 257,500 | 299,483 |
| Convertible bonds | 501,628 | 441,108 | 425,200 | 371,894 |
| Other loan | - | 8,500 | - | - |
| Less: Long-term loans payable in the next 12 months |
(541,845) | (728,333) | (58,750) | (103,625) |
| Total long-term borrowings | 980,893 | 855,987 | 623,950 | 597,144 |
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Short-term borrowings | ||||
| Obligations under finance lease | 317 | 266 | - | - |
| Bank loans | 101,248 | 89,799 | 15,922 | - |
| Bank overdrafts | - | 97 | - | - |
| Other loans | - | - | 900 | 3,270 |
| Plus: Long-term loans payable in the next 12 months |
541,845 | 728,333 | 58,750 | 103,625 |
| Total short-term borrowings | 643,410 | 818,495 | 75,572 | 106,895 |
The total financial cost of the long-term and short-term loan liabilities as well as of the finance leases for the annual period 01/01-31/12/2017 (and the respective comparative annual period) is included in "Financial expenses" of the consolidated and separate Income Statement.
The Group's average borrowing interest rate for the annual period ending on 31/12/2017 amounted to (a) 5.67 % (2016: 6.14%) regarding long term loans and (b) 5.27% (2016: 6.04%) regarding short term loans.
The Group's loan liabilities as at 31/12/2017 include capital and interest obligations (as also referred to in Note 3.1) totaling € 531,859k for the Group's subsidiaries, regarding which, as at the accompanying financial statements approval date, the Management is at the stage of negotiation or initial agreement on restructuring with the creditor banks.
On 18/03/2015, MIG signed the issue of a new Common Bond Loan amounting up to € 115,000k in two tranches, where PIRAEUS BANK assumed the obligation to cover it, in order for MIG to refinance equivalent existing debt towards the credit institution. The issuance of the first tranche worth € 100,000k was completed on 19/03/2015, while the issuance of the second tranche worth € 15,000k was completed on 21/10/2016. The refinancing agreement provides for the long-term restructuring of the said debt, by extending the maturity by 3 years (October 2019). The interest rate was defined at 6-month Euribor plus 4.10% spread, which will increase gradually, reaching 5.25% in the last year (2019).
The amendments to the agreement signed within 2017 changed the repayment of the capital installments, making contractual instalments of € 28,750k payable within 2018.
On 21/10/2016 MIG signed the issue of a Common Bond Loan amounting up to € 150,000k where EUROBANK group assumed the obligation to cover it, in order for MIG to refinance equivalent existing debt towards the credit institution. The duration of the loan was 3 years, maturing in October 2019. The interest rate was defined at 6-month Euribor plus 4.40% spread, which will increase gradually, reaching 5.25% in the last year (2019).
On 02/12/2016, EUROBANK transferred the Common Bond Loan issued by the Company amounting to € 150,000k to Investment Funds managed by FORTRESS. The Bank has retained its status as the Paying Attorney and Representative of Bondholders.
As at 31/12/2017, the remaining amount stands at € 142,500k following the payment of the first instalment amounting to € 7,500k as at 30/06/2017. Regarding the effective instalment of € 15,000k initially payable on 23/10/2017, the Company received a letter of concession regarding postponing the payment till 22/05/2018 inclusively. Therefore, the installments amounting to € 30,000 are contractually payable within 2018.
To secure the aforementioned bond loans amounting to a total of € 257,5 m as at 31/12/2017, MIG has pledged the total shares of ATTICA, HYGEIA and VIVARTIA held (directly or indirectly) by the Company. The Company retains the voting rights of the aforementioned shares, though the pledge extends to fruits and benefits of the above securities and is attributable to the Company given that no event terminating the agreement has occurred.
On 18/03/2015, MIG issued a new € 50,000k Common Bond Loan which was covered by PIRAEUS BANK S.A., with the remaining amount on 31/12/2016 standing at € 34,483k fully repaid within FY 2017.
Within the current year, on 31/07/2017, both Tranches of the CBL (issued on 29/07/2013 and 13/06/2014)) was fully repaid from the proceeds of the issue of Tranche A of the New CBL amounting to € 425,200k.
On 27/07/2017, the Board of Directors of MIG specified the terms of the new Convertible Bond Loan (CBL), the issuance of which was resolved by the 2nd Reiterative Annual General Meeting of 10 July 2017. The aggregate amount of the CBL may not exceed the amount of € 460,302k divided
into a maximum number of 1,534,340,000 bonds of a par value of € 0.30 each convertible into shares.
Bondholders may ask for conversion of their bonds into shares of the Company for the first time twelve (12) months following the issuance date of the CBL and, subsequently, at every monthly anniversary throughout the term of the CBL, upon written notice to the Company (hereinafter referred to as the "Conversion Notice Day"). In such case, the Company shall have an early repayment right in respect of the entire number (and not part of) the bonds for which the conversion right is exercised, within fifteen (15) working days starting from the day following the Conversion Notice Day. If the time-limit in question expires without any action, said bonds will be converted on the twentieth (20th) working day after the Conversion Notice Day (hereinafter referred to as the "Conversion Day"). The conversion price will be equal to the stock market price on the day prior to the Conversion Notice Day. If, on the day prior to the Conversion Notice Day, the stock market price of the share is lower than its nominal value (€ 0.30), the Company, upon bondholders' request will proceed to all appropriate corporate actions, including reducing the number of shares (reverse split) and at the same time reducing the share capital, by reducing the nominal value of each share for the purpose of writing off loss, in order to cause a readjustment of the stock market price to at least thirty cents (€ 0.30), which shall then constitute the conversion price. In such case, the Conversion Day will be subsequent to the completion of the relevant corporate actions. On 28/07/2017, MIG signed the Convertible Bond Loan Issuance Programme Plan up to the amount of € 460,250k. The coverage and payment by PIRAEUS BANK of Tranche A amounting to € 425,200k divided into 1,417,333,334 bonds of a par value of € 0.30 each convertible into Company's shares took place on 31 July 2017, and was certified by the Board of Directors on the same day. The 31st July 2017 was determined as issuance date. The new CBL has not been listed for trading on the Athens Exchange.
The proceeds from the issuance were used for refinancing of other existing loan obligations of the Company, including both tranches of the CBL totaling € 375,247k, intragroup loans totaling € 2,370k and outstanding borrowings as at 31/07/2017 to PIRAEUS BANK amounting to € 47,583k (including additional financing amounting to € 40,000k gradually provided within 2017, in order to cover operational and financial needs.) The term of the CBL shall be four years and will involve an early repayment right of the Company on each monthly anniversary throughout the term of the CBL, especially in case that the conversion right is exercised as provided below. The CBL interest-rate shall be 12-month EURIBOR plus 4% spread. According to the CBL Programme, the Company has the option to recapitalise part of any interest due, at its absolute discretion, through issuance of up to 116,833,849 additional bonds (PIK Bonds) of a par value of € 0.30 each convertible into Company's shares. The CBL may be secured by collateral on listed and unlisted shares owned by the Company. The agreement includes terms relating to the issuer's obligations and constraints, termination events, compliance with financial covenants and disposal of Group assets after obtaining any required consents from other interested parties.
As at 31/12/2017, VIVARTIA group loan liabilities amounted to € 369,467k, of which an amount of € 371,462k pertains to short-term debt obligations. Borrowings amounting to € 318,000k concern Common Syndicated Bond Loans, whose restructuring as at the date of approval of the accompanying financial statements is at the final phase of implementation, with a predetermined date of completion of 18/07/2018 at the latest.
In particular, on 01/03/2018, VIVARTIA group signed a Private Restructuring Agreement (hereinafter referred to as the "Agreement") with the crediting banks, on bond loans totaling € 318,000k of VIVARTIA group and interest due on syndicated loans of Catering sector, which at
31/12/2017 amounted to € 51.5 m. The Agreement records the framework of the basic terms of the Restructuring of the aforementioned loans, the pending terms conditions to be complied with and the timetable of the program's implementation.
The aforementioned Agreement reflects the need to adjust loans to the adverse conditions prevailing in the Greek Economy in recent years and was based on business plans of the next five years for which IBRs were performed by an independent auditing firm and on the one hand makes provisions for substantial decrease in financial costs (lower interest rates) and on the other hand extends the loans maturity for a further seven years. The agreement makes provisions for issuing a Common Bond Loan amounting to € 103 m, the proceeds of which were used for the repayment of equal bank liabilities of the catering sector.
The Common Bond Loan plan was signed according to the schedules as at 04/04/2018, and its coverage was completed on 18/04/2018.
The plan makes provisions for an annual three-month Euribor rate plus 3% margin and specific capital repayments over the seven-year period. Among other things, provisions are made for receiving corporate guarantees from the subsidiaries of DELTA and BARBA STATHIS, pledges over chares of BARBA STATHIS, GOODY'S and EVEREST held by VIVARTIA, incorporation of potential pledging procedures in respect of DELTA shares, as well as pledges over BARBA STATHIS trade receivables standing at € 3 m. The plan also includes terms relating to obligations and restrictions imposed on the Issuer (VIVARTIA) and the Guarantors (DELTA and BARBA STATHIS), obligations to observe specific financial ratios and termination events.
In order to facilitate more efficient implementation of the new agreement, the Group's structure was restructured through the acquisition of EVEREST group (subsidiary until then of GOODY'S) by VIVARTIA versus € 47 m. The above acquisition was based on a valuation of EVEREST group performed by an independent company based on the aforementioned business plans and conducted on 16/03/2018 as part of the schedule of the actions included in the Restructuring Agreement. The transaction consideration was paid by VIVARTIA on the date of coverage of the Common Bond Loan, ie on 18/04/2018.
VIVARTIA group has already addressed the pre-existing terms and conditions under the aforementioned agreement, all stages of the schedule regarding the issue and coverage of VIVARTIA Common Bond Loan amounting to € 103,000k.
Subsequently, according to the terms of the Agreement and Common Bond Loan of VIVARTIA, an agreement on the Final Terms of the syndicated bond loans of DELTA, BARBA STATHIS, GOODY'S and EVEREST subsidiaries is expected to be reached by 18/07/2018 at the latest. In this context, on 17/04/2018 the subsidiaries received approvals on requests for extension of maturity of the aforementioned loans until 20/04/2018 and retroactive application of the new lower interest rates from 20/01/2018 to 20/04/2018 as referred to in the Restructuring Agreement dated 01/03/2018. From the negotiations held so far, no significant differentiation is expected other than those recorded above, as reflected in VIVARTIA Common Bond Loan Agreement.
Furthermore, according to the relevant references of the aforementioned Agreement, following the settlement of the syndicated loan, a final settlement of the other loan liabilities is expected (plus interest) of the Catering sector, totaling € 11.9k, whose the repayment date has expired and a restructuring proposal has been made to the crediting bank, so that it could be approved it within the next few months as it is directly related to the final terms of the restructuring.
Since till 31/12/2017 the aforementioned loans have not been settled, the group continued to account for them in the current liabilities in compliance with the relative provisions of IAS.
On 31/12/2017, ATTICA group loans stood at € 238,733k, of which € 24,303k are short-term loan liabilities. Changes to the balances of the convertible bond loans of accounting value € 76,428k as at 31/12/2017, are attributed to fair value measurement (see Note 4.2.3).
On 31/12/2017, HYGEIA group loans stood at € 131,592k, of which € 14,900k are short-term loan liabilities. In particular:
On 21/11/2017, in accordance with the provisions of Law 3156/2003 and Codified Law 2190/2190 the group signed the Additional Amendment Act for the Common Bond Loan issued as at 28/09/2012 via private placement financed by PIRAEUS BANK S.A., EUROBANK ERGASIAS BANK S.A. and ALPHA BANK S.A., with the former acting as representative and payment agent. As at the Amendment singing date, the unpaid amount stood at € 87,645k.
The main terms of the Additional Amendment Act for the program are as follows: a) Extension of the maturity date by 5 years, as till 22/11/2021, with the option of a further 2-year extension, b) Three-month interest period, with a drop in the interest margin to 4% annually, c) Amendment to the repayment schedule for the existing unpaid capital to semi-annual installments, and d) Compliance with financial covenants at each financial result reporting period (semi-annual and annual). Therefore, an amount of € 82,613k was reclassified from short-term to long-term loan liabilities. Typical forms of collateral for this type of loan were used to secure the program, including pledges on property, plant and equipment, notional pledge on equipment amounting to € 116.8 m, as well as pledges on receivables from insurance funds and trademarks of HYGEIA.
On 21/11/2017, the group signed the Additional Amendment Act for the Common Bond Loan issued as at 30/12/2013 via private placement financed by PIRAEUS BANK S.A., EUROBANK ERGASIAS BANK S.A. and ALPHA BANK S.A., with the former acting as representative and payment agent. As at the Amendment singing date, the unpaid amount stood at € 41,163k.
The main terms of the Additional Amendment Act for the program are as follows: a) Extension of the maturity date by 5 years, as till 15/11/2021, with the option of a further 2-year extension, b) Three-month interest period, with a drop in the interest margin to 4% annually, c) Amendment to the repayment schedule for the existing unpaid capital to semi-annual installments, and d) Compliance with financial covenants at each financial result reporting period (semi-annual and annual). Therefore, an amount of € 39,296k was reclassified from short-term to long-term loan liabilities. Typical forms of collateral for this type of loan were used to secure the program, including pledges on property, plant and equipment, notional pledge on equipment amounting to € 50.6 m, as well as pledges on receivables from insurance funds and trademarks of MITERA. Within FY 2017, HYGEIA group Management received consent from the collaborating banks as at 31/12/2017 to lift the obligation of conformity with the financial ratios of MITERA bond loan.
On 31/12/2017, RKB's bank loans stood at € 75,0m and pertained to short-term loan liabilities, while Group's other current liabilities also include accrued interest amounting to € 22.7 m.
The above loan was issued in 24/06/2008 and its terms provide for termination events including, amongst others, overdue payments, financial covenants and noncompliance with the general and financial assurances which have been provided. Also, to ensure the above loan, RKB real estate
properties were pledged. RKB has classified the loan to short-term borrowings under the requirements of IAS 1, as the company was not in compliance with contractual terms. The Group's Management is in the process of negotiations regarding the restructuring of the above loan.
On 31/12/2017 the loans of SINGULARLOGIC group stood at € 58,341k, of which an amount of € 58,203k pertained to short-term loan liabilities.
Short-term loan liabilities include bond loans amounting to € 52,790k, contractually terminated as at 31/01/2018. SINGULARLOGIC's management is in discussions with creditor banks in order to restructure and refinance these loans.
On 31/01/2018, in the context of the effective negotiations with the credit institutions, for the purposes of refinancing its loan liabilities amounting to € 52,790k, the company sent requests for consensus regarding the extension of maturity of the loans. In this context, the company received letters of consent from the cooperating creditor banks on 02/04/2018 and 18/04/2018 and with retroactive effect from 31/01/2018 regarding the extension of the maturity date of the Common Bond Loans in question until 31/05/2018. Furthermore, it has been agreed that the company would pay capital installments on the aforementioned Common Bond Loans of € 1.5 m plus interest, whose repayment will be carried out through the "bridge" bilateral loan of the creditor bank.
To secure the bond loans, SINGULARLOGIC has pledged the total of its shares as well as trademarks and trade receivables as defined by the loan agreements. Moreover, the company has pledged the total shares issued by its subsidiaries, owned by the company, which extends to the dividends arising from the aforementioned shares.
Regarding the long-term and short-term loans, the table below presents future repayments for the Group on 31/12/2017 and 31/12/2016.
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Within 1 year | 643,410 | 818,495 | 75,572 | 106,895 |
| After 1 year but not more than 2 years | 365,003 | 53,656 | 198,750 | 26,500 |
| After 2 years but not more than 3 years | 45,807 | 509,474 | - | 361,069 |
| After 3 years but not more than 4 years | 525,593 | 240,854 | 425,200 | 209,575 |
| After 4 years but not more than 5 years | 30,618 | 7,600 | - | - |
| More than 5 years | 13,872 | 44,403 | - | - |
| 1,624,303 | 1,674,482 | 699,522 | 704,039 |
Future minimum payments for finance leases in connection with the present value of net minimum lease payments for the Group and the Company on 31/12/2017 and 31/12/2016 are as follows:
| THE GROUP | |||||||
|---|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | ||||||
| Amounts in € '000 | Future minimum lease payments |
Present value of future minimum lease payments |
Future minimum lease payments |
Present value of future minimum lease payments |
|||
| Within 1year | 1,688 | 1,485 | 1,645 | 1,346 | |||
| After 1year but not more than 5 years | 2,733 | 2,604 | 4,282 | 3,948 | |||
| Total of future minimum lease payments | 4,421 | 4,089 | 5,927 | 5,294 | |||
| Less: Interest expenses | (332) | - | (633) | - | |||
| Total of Present value of future minimum lease payments |
4,089 | 4,089 | 5,294 | 5,294 |
The total financial cost of the long-term and short-term loan liabilities as well as of the finance lease obligations for the financial year which ended on 31/12/2017 is included in the account "Financial Expenses" of the consolidated and separate Income Statement (see Note 40).
Changes in liabilities arising from financing activities of the Group and the Company for FY ended as at 31/12/2017 are presented below as follows:
| Amounts in €'000 | Long-term borrowings | Short-term debt | Total | |
|---|---|---|---|---|
| 31/12/2016 | 855,987 | 818,495 | 1,674,482 | |
| Cash flows: | ||||
| Repayments | (381,473) | (140,947) | (522,420) | |
| Proceeds | 425,200 | 52,985 | 478,185 | |
| Non cash changes: | ||||
| Acquisitions through business combinations /Disposals from Sale of subsidiaries |
- | 45 | 45 | |
| Transfer to disposal groups classified as held for sale |
(11,318) | (7,606) | (18,924) | |
| Fair value changes | 8,927 | - | 8,927 | |
| Reclassifications | 80,203 | (80,203) | - | |
| Other changes | 3,367 | 641 | 4,008 | |
| 31/12/2017 | 980,893 | 643,410 | 1,624,303 |
| THE COMPANY | ||||||
|---|---|---|---|---|---|---|
| Amounts in €'000 | Long-term borrowings | Short-term debt | Total | |||
| 31/12/2016 | 597,144 | 106,895 | 704,039 | |||
| Cash flows: | ||||||
| Repayments | (375,247) | (102,523) | (477,770) | |||
| Proceeds | 425,200 | 44,700 | 469,900 | |||
| Non cash changes: | ||||||
| Reclassifications | (26,500) | 26,500 | - | |||
| Other changes | 3,353 | 3,353 | ||||
| 31/12/2017 | 623,950 | 75,572 | 699,522 |
As at 31/12/2017, financial derivatives amounted to receivables of € 4,433k versus receivables of € 5,877k as at 31/12/2016. The derivatives in question pertain to hedging actions on fuel price fluctuations undertaken by ATTICA group. The items in question are evaluated at fair value.
| THE GROUP | ||||||
|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||
| Amounts in € '000 | Other provisions |
Provision of affairs sub judice |
Total | Other provisions |
Provision of affairs sub judice |
Total |
| Opening Balance | 1,867 | 15,096 | 16,963 | 630 | 13,781 | 14,411 |
| Additional provisions | 190 | 93 | 283 | 1,625 | 1,541 | 3,166 |
| Utilised provisions | (64) | (121) | (185) | - | (202) | (202) |
| Reversal of provisions | (825) | (2,360) | (3,185) | - | (24) | (24) |
| Reversal of provisions (sold subsidiary) | - | (40) | (40) | - | - | - |
| Reclassification | - | - | - | (388) | - | (388) |
| Closing balance | 1,168 | 12,668 | 13,836 | 1,867 | 15,096 | 16,963 |
| Non-Current Provisions | 1,062 | 12,299 | 13,361 | 1,837 | 14,683 | 16,520 |
| Current provisions | 106 | 369 | 475 | 30 | 413 | 443 |
| 1,168 | 12,668 | 13,836 | 1,867 | 15,096 | 16,963 |
The table below provides an analysis of the movements in the Provisions account of the Group:
Apart from the analysis based on the nature of the commitment, the table above also presents the analysis based on the expected timing of the outflow (presenting the distinction between current and non – current provisions). More specifically with regards to the non-current provisions, it is noted that these are not presented at discount, since there is no estimate in respect to the timing of their payment.
Provisions for court litigations regarding the Group amounting, as at 31/12/2017, to € 12,668k, mainly pertain to (a) provisions made by HYGEIA group amounting to € 9,750k, occurring due to the nature of its operations, where there are pending court related to medical liabilities, (b) an amount of € 1,331k pertains to provisions made by VIVARTIA group, and (c) an amount of € 1,218k pertains to provisions made by ATTICA group, mainly in respect to compensation to sailors who used to be employed to the group's vessels.
The other provisions of the Group amount to € 1,168k on 31/12/2017. This category refers to various provisions in respect to risks of VIVARTIA group's companies, none of which is unilaterally significant compared to the financial size of the consolidated financial statements.
The Group's and the Company's other long-term liabilities are analyzed as follows:
| THE GROUP | THE COMPANY | ||||
|---|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | |
| Social security insurance | 20 | 69 | - | - | |
| Other liabilities | 6,425 | 11,690 | 4,955 | 9,514 | |
| Total | 6,445 | 11,759 | 4,955 | 9,514 |
The Group's trade payables are analyzed as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |
| Suppliers | 149,908 | 162,341 | |
| Checks Payable | 4,884 | 4,915 | |
| Customers' Advances | 8,638 | 6,803 | |
| Other Liabilities | 6,718 | 6,549 | |
| Total | 170,148 | 180,608 |
There is no analysis of the Company's trade payables since the Company is a holding company.
The Group's current tax liabilities refer to current liabilities from income tax:
| THE GROUP | ||||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | ||
| Tax expense for the year | 1,119 | 1,710 | ||
| Tax audit differences | 360 | 621 | ||
| Total | 1,479 | 2,331 |
The Group's and the Company's other short-term liabilities are analyzed as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Deferred income-Grants | 8,717 | 7,375 | - | - |
| Social security insurance | 11,441 | 13,504 | 118 | 135 |
| Other Tax liabilities | 21,374 | 24,161 | 274 | 705 |
| Dividends payable | 1,880 | 1,257 | - | - |
| Salaries and wages payable | 6,451 | 6,701 | - | 31 |
| Accrued expenses | 12,420 | 17,181 | 1,004 | 1,037 |
| Others Liabilities | 18,848 | 17,409 | 3,642 | 3,924 |
| Obligation arising from tangible assets acquisitions | 1,478 | 888 | - | - |
| Accrued Interest expenses | 91,511 | 73,645 | 10,596 | 6,816 |
| Total | 174,120 | 162,121 | 15,634 | 12,648 |
The accrued interest expenses account includes an interest amount due by Group subsidiaries of approximately € 76.7 m which, as at 31/12/2017, has not been paid as part of the negotiating process for the restructuring of the loan liabilities of the Group with its lending banks. The aforementioned amount includes interest of € 51.5 m of VIVARTIA group repaid as at 18/04/2018 (see Note 27).
The Group's sales are analyzed as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | |
| Marine transports | 260,859 | 258,259 | |
| Sales of goods | 432,179 | 443,965 | |
| Sales of merchandises | 128,143 | 118,691 | |
| Sales of raw materials | 7,694 | 10,233 | |
| Income from services provided | 239,085 | 240,233 | |
| Revenues from hotel industry | 11,967 | 10,655 | |
| Total from continuing operations | 1,079,927 | 1,082,036 | |
| Total from discontinued operations | 21,588 | 21,840 | |
| Total | 1,101,515 | 1,103,876 |
Allocation of revenue from sales by the Group's operating segments is presented in Note 8.
The cost of sales, administrative and distribution expenses of the Group are analyzed as follows:
| THE GROUP | ||||||||
|---|---|---|---|---|---|---|---|---|
| 01/01-31/12/2017 01/01-31/12/2016 |
||||||||
| Amounts in € '000 | Cost of sales |
Administrative expenses |
Distribution expenses |
Total | Cost of sales |
Administrative expenses |
Distribution expenses |
Total |
| Wages, retirement and other employee benefits |
182,787 | 53,179 | 58,898 | 294,864 | 180,877 | 52,139 | 57,469 | 290,485 |
| Inventory cost | 311,582 | 56 | 556 | 312,194 | 301,151 | 83 | 533 | 301,767 |
| Tangible assets depreciation | 55,903 | 5,063 | 6,031 | 66,997 | 55,163 | 4,564 | 6,536 | 66,263 |
| Intangible assets depreciation | 7,082 | 2,175 | 685 | 9,942 | 7,454 | 2,130 | 631 | 10,215 |
| Third party expenses | 33,167 | 16,273 | 4,296 | 53,736 | 30,635 | 19,476 | 3,636 | 53,747 |
| Third party benefits | 28,774 | 2,299 | 4,372 | 35,445 | 28,258 | 2,345 | 4,255 | 34,858 |
| Operating leases rentals | 11,482 | 3,662 | 14,409 | 29,553 | 10,327 | 3,532 | 12,694 | 26,553 |
| Taxes & Duties | 2,864 | 1,134 | 1,443 | 5,441 | 2,407 | 1,315 | 1,726 | 5,448 |
| Fuels - Lubricants | 87,276 | 13 | 630 | 87,919 | 65,435 | 19 | 466 | 65,920 |
| Provisions | 3,961 | 319 | 1,494 | 5,774 | 8,650 | 1,209 | 7,148 | 17,007 |
| Insurance | 5,844 | 1,548 | 464 | 7,856 | 6,285 | 1,934 | 485 | 8,704 |
| Repairs and maintenance | 36,521 | 2,709 | 2,287 | 41,517 | 31,633 | 2,673 | 2,393 | 36,699 |
| Other advertising and promotion expenses |
5,848 | 581 | 19,639 | 26,068 | 7,516 | 757 | 30,766 | 39,039 |
| Sales commission | 203 | - | 18,597 | 18,800 | 169 | - | 18,106 | 18,275 |
| Port expenses | 11,082 | - | - | 11,082 | 10,228 | - | - | 10,228 |
| Other expenses | 14,487 | 5,174 | 6,103 | 25,764 | 17,461 | 6,001 | 5,350 | 28,812 |
| Transportation expenses | 5,655 | 398 | 14,290 | 20,343 | 5,822 | 429 | 13,803 | 20,054 |
| Consumables | 6,692 | 290 | 1,086 | 8,068 | 6,447 | 265 | 1,049 | 7,761 |
| Total costs from continuing operations |
811,210 | 94,873 | 155,280 | 1,061,363 | 775,918 | 98,871 | 167,046 | 1,041,835 |
| Total costs from discontinued operations |
18,978 | 4,673 | - | 23,651 | 18,893 | 4,777 | - | 23,670 |
| Total | 830,188 | 99,546 | 155,280 | 1,085,014 | 794,811 | 103,648 | 167,046 | 1,065,505 |
In 2017, administrative expenses of the Group include the fees of the statutory auditors amounting to € 171.4k that pertain to officially permitted non-assurance services.
The Company's operating expenses are analyzed as follows:
| THE COMPANY | ||||||||
|---|---|---|---|---|---|---|---|---|
| 01/01-31/12/2017 | 01/01-31/12/2016 | |||||||
| Amounts in € '000 | Fees and other expenses to third parties |
Wages, salaries and social security costs |
Other operating expenses |
Total | Fees and other expenses to third parties |
Wages, salaries and social security costs |
Other operating expenses |
Total |
| Wages, retirement and other employee benefits | - | 4,803 | - | 4,803 | - | 4,460 | - | 4,460 |
| Third party expenses | 4,270 | - | 896 | 5,166 | 7,423 | - | 1,465 | 8,888 |
| Third party benefits | - | - | 91 | 91 | - | - | 146 | 146 |
| Operating leases rentals | - | - | 479 | 479 | - | - | 643 | 643 |
| Taxes & Duties | - | - | 32 | 32 | - | - | 58 | 58 |
| Insurance | - | - | 769 | 769 | - | - | 1,158 | 1,158 |
| Repairs and maintenance | - | - | 250 | 250 | - | - | 296 | 296 |
| Other advertising and promotion expenses | 308 | - | - | 308 | 216 | - | - | 216 |
| Other expenses | 211 | - | 375 | 586 | 42 | - | 527 | 569 |
| Total | 4,789 | 4,803 | 2,892 | 12,484 | 7,681 | 4,460 | 4,293 | 16,434 |
Within the current period, the amounts recognized in the Income Statement of the Group and the Company due to the defined pension benefit plans stand at € 2,941k and € 1,344k, respectively. The amounts in question are included in the item "Retirement benefits".
The Group's and the Company's other operating income is analyzed as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | |
| Rent income | 1,688 | 1,731 | |
| Income from subsidies | 2,620 | 2,939 | |
| Compensations | 674 | 131 | |
| Grants amortization | 843 | 871 | |
| Income from reversal of unrealized provisions | 6,359 | 9,620 | |
| Income from services provided | 10,497 | 12,640 | |
| Other income | 14,454 | 12,669 | |
| Profit on sale of investment property, property, plant and equipment and intangible assets |
236 | 452 | |
| Other operating income from continuing operations | 37,371 | 41,053 | |
| Other operating income from discontinued operations | 241 | 192 | |
| Total other operating income | 37,612 | 41,245 |
| THE COMPANY | |||
|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | |
| Other income | 51 | 6 | |
| Profit on sale of property, plant and equipment | 42 | 3 | |
| Total other operating income | 93 | 9 |
The other operating expenses for the Group are presented as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | |
| Real estate tax and other taxes | 1,342 | 1,479 | |
| Provisions | 1,486 | 15,399 | |
| Fair value adjustment of investment property (Note 15) | 10,942 | 7,277 | |
| Losses on sale of investment property, property, plant and equipment and intangible assets |
266 | 58 | |
| Other expenses | 1,082 | 1,348 | |
| Other operating expenses from continuing operations | 15,118 | 25,561 | |
| Other operating expenses from discontinued operations | 73 | 228 | |
| Total other operating expenses | 15,191 | 25,789 |
The Group's and the Company's other financial results are analyzed as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | |
| Profit / (loss) from trading portfolio and financial instruments measured at fair value through profit/loss |
1,004 | (13) | |
| Profit / (loss) from the sale of trading portfolio and financial instruments measured at fair value through P&L |
225 | 115 | |
| Impairment losses of assets | (4,041) | (36,707) | |
| Profits from reversal of impairment of assets | 5,326 | 17,526 | |
| Results from derivatives | (1,156) | (2,633) | |
| Foreign exchange gains/(losses) | (119) | (189) | |
| Other financial results | 443 | (3,139) | |
| Other financial results income from continuing operations | 1,682 | (25,040) | |
| Other financial results income from discontinued operations | 223 | (7,413) | |
| Total other financial results | 1,905 | (32,453) |
| THE COMPANY | ||||
|---|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | ||
| Profit/(Loss) from sale of subsidiaries and associates | (310) | - | ||
| Impairment losses of investments and other assets | (43,146) | (61,677) | ||
| Profits from reversal of impairment | - | 414 | ||
| Total income/(expenses) from investments in subsidiaries & investment portfolio |
(43,456) | (61,263) | ||
| Profit/(Loss) from the sale of financial instruments of trading portfolio | 226 | 116 | ||
| Fair value profit from trading portfolio | - | (8) | ||
| Foreign exchange profit/(loss) | (8) | 43 | ||
| Total income/(expenses) from financial assets at fair value through profit or loss | 218 | 151 | ||
| Total other financial results | - | 403 |
The impairment recognized in the consolidated and separate financial statements for the years 2017 and 2016, is further analyzed as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 |
| Impairment loss of: | ||||
| Goodwill | - | 5,320 | - | - |
| Intangible assets | 4,041 | 12,179 | - | - |
| Tangible assets | - | 19,133 | - | - |
| Investments in subsidiaries | - | - | 32,962 | 55,169 |
| Associates and other assets | - | 75 | 10,184 | 6,508 |
| Impairment loss from continuing operations | 4,041 | 36,707 | 43,146 | 61,677 |
| Impairment loss from discontinued operations | - | 7,582 | - | - |
| Total impairment losses | 4,041 | 44,289 | 43,146 | 61,677 |
The Group's and the Company's financial expenses are analyzed as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 01/01- 31/12/2017 |
01/01- 31/12/2016 |
01/01- 31/12/2017 |
01/01- 31/12/2016 |
| Interest expenses from long-term loans | 5,608 | 5,728 | - | - |
| Interest expenses from short-term loans | 5,343 | 7,105 | 1,741 | 1,433 |
| Interest expenses from bonds | 80,704 | 88,212 | 34,351 | 38,047 |
| Finance charges payable under finance leases and hire purchase contracts |
324 | 376 | - | - |
| Charge from retirement employee benefits | 656 | 732 | 3 | 4 |
| Commission for guaranties | 268 | 275 | - | 4 |
| Other interest related expenses | 5,785 | 5,050 | 54 | 60 |
| Financial expenses from continuing operations | 98,688 | 107,478 | 36,149 | 39,548 |
| Financial expenses from discontinued operations | 1,807 | 1,648 | - | - |
| Total financial expenses | 100,495 | 109,126 | 36,149 | 39,548 |
The Group's and the Company's financial income is analyzed as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 01/01- 31/12/2017 |
01/01- 31/12/2016 |
01/01- 31/12/2017 |
01/01- 31/12/2016 |
| Bank interest | 105 | 414 | 28 | 64 |
| Interest from customers | 205 | 18 | - | - |
| Interest from grants loans | - | - | 120 | 99 |
| Expected return on plan assets | 25 | 21 | - | - |
| Other interest related incomes | 68 | 66 | - | - |
| Financial income from continuing operations | 403 | 519 | 148 | 163 |
| Financial income from discontinued operations | 3 | 3 | - | - |
| Total financial income | 406 | 522 | 148 | 163 |
The following table presents the Group's profit and loss from associates consolidated under the equity method:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | |
| Gains from associates | 1,013 | 885 | |
| Losses from associates | (7,520) | (2,575) | |
| Total from continuing operations | (6,507) | (1,690) | |
| Gains/(losses) from associates - Discontinued operations | (310) | 3,105 | |
| Total | (6,817) | 1,415 |
Income tax (from both continuing and discontinued operations) presented in the Financial Statements is analyzed for both the Company and the Group as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 |
| Current income tax | 5,010 | 6,221 | - | - |
| Deferred income tax | (3,380) | (10,574) | - | - |
| Tax audit differences | (138) | 116 | - | - |
| Other taxes | 535 | 1,251 | - | - |
| Total income tax from continuing operations |
2,027 | (2,986) | - | - |
| Income tax from discontinued operations |
(5) | (6) | - | - |
| Total income tax | 2,022 | (2,992) | - | - |
The agreement on the income tax amount as defined by applying the Greek tax rate on the income before tax is summarized as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 | |
| Profit before income tax (from continuing and discontinued operations) |
(73,950) | (85,802) | (92,010) | (116,931) |
| Nominal Tax rate | 29% | 29% | 29% | 29% |
| Presumed Tax on Income | (21,446) | (24,883) | (26,683) | (33,910) |
| Adjustments for non-taxable income | ||||
| - Non-taxable income | (1,839) | (8,817) | - | - |
| - Offset due to accumulated losses from previous financial years |
(7,972) | (7,429) | - | - |
| Additional taxes and increases from preceding years |
323 | 1,953 | - | - |
| - Damage of the year for which was not recognized deferred tax asset |
27,388 | 28,896 | 24,409 | 29,875 |
| Dividends or profits from participations | - | - | - | - |
| - Other | (2,879) | (3,996) | - | - |
| Adjustments for non-deductible expenses for tax purposes |
||||
| - Non-tax deductible expenses | 6,752 | 9,854 | 2,274 | 4,027 |
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 | |
| - Tax differences of preceding financial years |
(25) | 45 | - | - |
| - Other expenses non-deductible for tax purposes |
- | 8 | - | 8 |
| - Additional taxes and surcharges | 60 | 74 | - | - |
| - Tax 27/75 | 99 | 80 | - | - |
| - Effect from differences in tax rates of foreign subsidiaries |
1,428 | 1,018 | - | - |
| - Other | 133 | 205 | - | - |
| Total tax from continuing and discontinued operations |
2,022 | (2,992) | - | - |
The Group and the Company have a contingent liability for additional penalties and taxes from the non- tax audited years for which sufficient provisions have been made (see Note 48.6). The non- tax audited years of the Company and consolidated companies of the Group, are presented in Note 2.
Under the Greek legislation, the tax rate effective for Greek companies in 2017 and 2016 is 29%.
Information on deferred tax is presented in Note 17.
Management remuneration for the Group and Company is presented below as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 |
| Short-term benefits of key management personnel | 14,809 | 13,922 | 1,901 | 1,875 |
| Post employment benefits | 2,096 | - | 1,152 | - |
| Benefits of discontinued operations | 468 | 474 | - | - |
| Total | 17,373 | 14,396 | 3,053 | 1,875 |
The aforementioned fees refer to Members of the BoD of the Company and its subsidiaries as well as to management executives of the Group and the Company.
Basic earnings per share for the period 01/01-31/12/2017 and for the respective comparable period for continuing and discontinued operations were calculated as follows:
| THE GROUP | THE COMPANY | |||||
|---|---|---|---|---|---|---|
| (a) Basic earnings/(loss) per share (amounts in € '000) | 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 | ||
| Profit/(Loss) | ||||||
| Profit/(loss) attributable to owners of the parent company from continuing operations |
(66,533) | (78,048) | (92,010) | (116,931) | ||
| Profit/(loss) attributable to owners of the parent company from discontinued operations |
(8,284) | (6,829) | - | - | ||
| Profit/(loss) attributable to owners of the parent company for the purposes of basic earnings per share |
(74,817) | (84,877) | (92,010) | (116,931) | ||
| Number of shares | ||||||
| Weight average number of shares for the basic earnings/(loss) per share |
939,510,748 | 939,446,776 | 939,510,748 | 939,446,776 | ||
| Basic earnings/(loss) per share (€ per share) from continuing operations |
(0.0708) | (0.0831) | (0.0979) | (0.1245) | ||
| Basic earnings/(loss) per share (€ per share) from discontinued operations |
(0.0088) | (0.0073) | - | - | ||
| Basic earnings/(loss) per share (€ per share) | (0.0796) | (0.0904) | (0.0979) | (0.1245) |
As at 31/12/2017, the Convertible Securities of the CBL of the Company are a category of potential share securities which could reduce earnings per share. In particular, in the context of the calculation of the diluted earnings per share, it is considered that the convertible securities have been converted to common shares and the net profit or loss is adjusted in order to eliminate interest expenses.
Diluted earnings per share for the period 01/01-31/12/2017 and the respective comparable period regarding continuing and discontinued operations were calculated as follows:
| THE GROUP | THE COMPANY | |||
|---|---|---|---|---|
| (b) Diluted earnings/(loss) per share (amounts in € '000) | 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 |
| Profit/(Loss) | ||||
| Profit/(loss) attributable to owners of the parent company from continuing operations |
(66,533) | (78,048) | (92,010) | (116,931) |
| Profit/(loss) attributable to owners of the parent company from discontinued operations |
(8,284) | (6,829) | - | - |
| Profit/(loss) attributable to owners of the parent company for the purposes of diluted earnings per share |
(74,817) | (84,877) | (92,010) | (116,931) |
| Interest expense of convertible bonds | 20,533 | 23,409 | 20,533 | 23,409 |
| Number of shares | ||||
| Weight average number of shares for the basic earnings/(loss) per share |
939,510,748 | 939,446,776 | 939,510,748 | 939,446,776 |
| Effect of dilution | ||||
| Plus: Increase in number of shares from due to probable exercise of convertible bonds |
2,269,664,629 | 516,314,445 | 2,269,664,629 | 516,314,445 |
| Weight average number of shares for the diluted earnings/(loss) per share |
3,209,175,377 | 1,455,761,221 | 3,209,175,377 | 1,455,761,221 |
| Diluted earnings/(loss) per share (€ per share) from continuing operations |
(0.0143) | (0.0375) | (0.0223) | (0.0642) |
| Diluted earnings/(loss) per share (€ per share) from discontinued operations |
(0.0026) | (0.0047) | - | - |
| Basic earnings/(loss) per share (€ per share) | (0.0169) | (0.0422) | (0.0223) | (0.0642) |
The tax effect of other comprehensive income to the Group and the Company is analyzed as follows:
| THE GROUP | ||||||
|---|---|---|---|---|---|---|
| Amounts in €'000 | 31/12/2017 | 31/12/2016 | ||||
| Before tax amount |
Tax (expense) /benefit |
Net of tax amount |
Before tax amount |
Tax (expense) /benefit |
Net of tax amount |
|
| Exchange differences on translating foreign operations |
146 | - | 146 | 154 | - | 154 |
| Exchange gain/(loss) on disposal of foreign operations recognised in profit or loss |
2,368 | - | 2,368 | - | - | - |
| Financial assets of investment portfolio | 7 | - | 7 | 8 | - | 8 |
| Cash flow hedging | 204 | - | 204 | 5,126 | - | 5,126 |
| Remeasurements of defined benefit pension plans | (1,029) | 255 | (774) | (750) | 208 | (542) |
| Share of other comprehensive income of equity accounted investments |
- | - | - | 77 | - | 77 |
| Other comprehensive income/(expenses) | 1,696 | 255 | 1,951 | 4,615 | 208 | 4,823 |
| THE COMPANY | ||||||
|---|---|---|---|---|---|---|
| Amounts in €'000 | 31/12/2017 | 31/12/2016 | ||||
| Before tax amount |
Tax (expense) /benefit |
Net of tax amount |
Before tax amount |
Tax (expense) /benefit |
Net of tax amount |
|
| Remeasurements of defined benefit pension plans | (23) | - | (23) | (16) | - | (16) |
| Other comprehensive income/(expenses) | (23) | - | (23) | (16) | - | (16) |
| a) Asset accounts | THE COMPANY | |||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | ||
| Borrowings and other receivables | 3,254 | 1,732 | ||
| Other long-term receivables | 251,836 | 251,836 | ||
| Other short term receivables | 150 | - | ||
| Total | 255,240 | 253,568 | ||
| b) Liability accounts | THE COMPANY | |||
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | ||
| Other liabilities | 9 | 42 | ||
| Borrowings and other liabilities | 900 | 3,294 | ||
| Total | 909 | 3,336 | ||
| c) Income | THE COMPANY | |||
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | ||
| Financial income | 120 | 99 | ||
| Total | 120 | 99 | ||
| d) Expenses | THE COMPANY | |||
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | ||
| Other expenses | 383 | 139 | ||
| Financial expenses | 121 | 138 | ||
| Total | 504 | 277 |
| a) Asset accounts | THE GROUP | THE COMPANY | ||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Trade and other receivables | 31,028 | 18,984 | - | - |
| Deposits | 42,213 | 44,849 | 9,160 | 6,842 |
| Total | 73,241 | 63,833 | 9,160 | 6,842 |
| b) Liability accounts | THE GROUP | THE COMPANY | ||
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 |
| Trade and other payables | 1,875 | 2,181 | 3 | 4 |
| Borrowings | 914,817 | 708,808 | 564,565 | 344,114 |
| Liabilities to Key Management personnel | 1 | - | 1 | - |
| Total | 916,693 | 710,989 | 564,569 | 344,118 |
| c) Income | THE GROUP | THE COMPANY | ||
|---|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 |
| Other income | 7,432 | 7,384 | - | - |
| Financial income | 78 | 304 | 25 | 56 |
| Total | 7,510 | 7,688 | 25 | 56 |
| d) Expenses | THE GROUP | THE COMPANY | ||
|---|---|---|---|---|
| Amounts in € '000 | 01/01-31/12/2017 | 01/01-31/12/2016 | 01/01-31/12/2017 | 01/01-31/12/2016 |
| Other expenses | 2,855 | 2,154 | 687 | 362 |
| Financial expenses | 41,178 | 39,674 | 21,518 | 19,626 |
| Total | 44,033 | 41,828 | 22,205 | 19,988 |
| THE GROUP | ||||
|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | ||
| Assets | 266,093 | 269,545 | ||
| Liabilities | (266,093) | (269,545) | ||
| Total | - | - | ||
| Amounts in € '000 | THE GROUP 01/01-31/12/2017 |
01/01-31/12/2016 | ||
| Sales | 25,082 | 27,232 | ||
| Operating income/(expenses) | (25,082) | (27,229) | ||
| Financial income | 241 | 237 | ||
| Financial expenses | (241) | (240) | ||
| Total | - | - |
The most significant transactions and outstanding balances between the Company and related parties on 31/12/2017, in compliance with the provisions of IAS 24, are as follows:
| Amounts in € '000 | ASSETS | LIABILITIES | INCOME | EXPENSES | |
|---|---|---|---|---|---|
| ATTICA | Subsidiary | - | - | - | 42 |
| VIVARTIA | Subsidiary | 1,732 | 1 | 98 | 84 |
| SINGULARLOGIC | Subsidiary | 1,522 | - | 22 | 111 |
| MIG MEDIA S.A. | Subsidiary | 150 | 5 | - | 259 |
| CYPRUS TOURISM DEVELOPMENT PUBLIC COMPANY LTD |
Subsidiary | - | 3 | - | 8 |
| JSC ROBNE KUCE BEOGRAD (RKB) | Subsidiary | 251,836 | - | - | - |
| ATHENIAN ENGINEERING | Subsidiary Discontinued operations |
- | 900 | - | - |
| PIRAEUS BANK group | Οther related parties |
9,160 | 564,568 | 25 | 22,205 |
| Key Management personnel | Οther related parties |
- | 1 | - | - |
| TOTAL | 264,400 | 565,478 | 145 | 22,709 |
The most significant transactions and the outstanding balances between the Group and related parties on 31/12/2017, in compliance with the provisions of IAS 24, are as follows:
| Amounts in € '000 | ASSETS | LIABILITIES | INCOME | EXPENSES | |
|---|---|---|---|---|---|
| Associates and related companies of SINGULARLOGIC group |
Associates and other related companies |
739 | 9 | 407 | 141 |
| Associates and related companies of VIVARTIA group |
Associates and other related companies |
2,257 | 18 | 1,831 | 285 |
| Associates and related companies of ATTICA group |
Associates and other related companies |
22,944 | 274 | 4,158 | 274 |
| HYGEIA HOSPITAL TIRANA SPH, PRIVATE POLICLINIC WEST ATHENS PRIMARY CARE MEDICINE S.A., BIO CHECK INTERNATIONAL PRIVATE MULTI-MEDICAL FACILITIES S.A. |
Subsidiaries Discontinued operations |
4,468 | 33 | 80 | - |
| PIRAEUS BANK group | Οther related parties | 42,833 | 916,358 | 1,034 | 43,333 |
| Key Management personnel | Οther related parties | - | 1 | - | - |
| 73,241 | 916,693 | 7,510 | 44,033 |
As at 31/12/2017, MIG Group's companies had the following contingent liabilities.
o Provision of performance guarantees amounting to € 198k (31/12/20165: € 198k),
o Issuance of guarantees to banks for the repayment of its subsidiaries' loans amounting to € 35,080k ( 31/12/2016: € 36,583k),
The Company and its subsidiaries (under their property as defendant and plaintiff) are involved in various court cases and arbitration procedures during their normal operations. The Group makes provisions in the Financial Statements in respect to the pending court cases when it is probable that cash outflows will be required in order to settle the liability and this amount can be estimated reliably.
The Group as of 31/12/2017 has made provisions amounting to € 12,668k (31/12/2016: € 15,096k) in respect to court cases (please refer to Note 30). The Management as well as the legal advisors estimate that the outstanding cases, apart from those already provided for, are to be settled without a significant negative impact on the Group's or Company's consolidated financial position or on their operating results.
Οn 23/01/2013, MIG served a "Notice of Dispute" to the Republic of Cyprus pursuant to the procedure provided by the bilateral international agreement in relation to the mutual promotion and protection of investments between Cyprus and Greece dated 30/03/1992 ("Agreement").
Under the Notice of Dispute, the Company requested the full restitution of the adverse consequences whether tangible or non –tangible which it suffered in its investment in "Cyprus Popular Bank Public Co" (later renamed to "Marfin Popular Bank Public Co Ltd." and further renamed to "Cyprus Popular Bank Public Company Ltd." which was put under resolution) (hereinafter "CPB") as a result of the illegal actions of the Republic of Cyprus which contravened the Agreement and the international customary legislation.
The aforementioned restitution was requested to take the form of "restitution in natura" which comprised restoration of the facts to the original state i.e. the state, existing before the illegal damaging actions of the Republic of Cyprus were taken or/and restitution in cash which should include at least the total amount of the Company's investment in CPB of €824 m as well as any other damage arising from this investment.
On 07/03/2013 MIG served the Republic of Cyprus a supplementary Report invoking newer data and final notification for its immediate recourse to the international arbitration procedure in the event of non-immediate commencement of substantial discussions on amicable settlement of the Dispute.
On 12/09/2013, after the lapse of the 6-month period after the notification of the Notice of Dispute for the amicable settlement of the dispute, the Company together with other Greek investors submitted the Request for Arbitration against the Republic of Cyprus to the Secretary-General of the Washington based International Centre for the Settlement of Investment Disputes established by the Convention of March 18, 1965 for regulating the disputes relating to the investments between States and nationals of other States. The constitution of the 3-membered Arbitral Tribunal was completed on 13/03/2014.
In the arbitration, MIG is seeking damages for losses relating to its investment in CPB amounting to € 824 m and any other losses incurred due to violations from the part of the Republic of Cyprus of articles 2, 3 and 4 of the Agreement. Moreover, MIG has reserved its right to supplement or expand upon its claims in the course of the arbitration proceedings.
On 11/04/2014 the first hearing of the arbitral tribunal was held for the examination and judgment on procedural matters. The Tribunal was composed of the following members: Bernard Hanotiau (Belgium) appointed as President and Mr. Daniel M Price (U.S.A.) and Sir David A.O. Edward (Great Britain) appointed as arbitrators. On 28/04/2014, the Tribunal issued Procedural Order No. 1, determining the procedural timetable, the place of proceedings (Paris), the sequence of the proceedings and other procedural matters, resolving any differences between the parties on these matters. The Republic of Cyprus retained its rights regarding the jurisdiction of the Tribunal, yet it participated in the arbitration proceedings as a party.
On 10/05/2016, MIG together with other Greek investors filed an application for interim measures requesting the protection of the integrity of the arbitration proceedings. The hearing for the interim measures was held in Paris on 04 and 05/08/2016.
By a series of Procedural Orders issued, the Tribunal proceeded repeatedly to regulate matters regarding the attendance in person, the issuance or non-issuance of arrest warrants and the adoption of measures with regard to the freedom of movement of the deceased Andreas Vgenopoulos and Messrs. Bouloutas, Foros and Magiras, their access to counsel and their appearance at the hearing of the arbitration proceedings. Furthermore, by new Procedural Orders the Tribunal made its judgment on issues regarding document production, the evidential record, the intervention of a third party in the proceedings as non-disputing party and procedural matters concerning the hearing.
The hearing of the international arbitration on the jurisdiction and the meritstook place in Paris in the period 06–09/03/ 2017. During the hearing the counsels of both parties pleaded orally, the experts presented their reports and both the witnesses and the experts of each party were crossexamined. As designated, the parties filed their post hearing briefs in reply of specific questions of the Tribunal within May 2017. Furthermore, the parties provided additional data as assistance to the Tribunal (such as comparison data for the financial situation of CPB and other Cypriot and Greek banks) and update on developments on various issues in line with the Tribunal's directions (such as the criminal case no. 15161/16).
On 05/10/2017, upon the Tribunal's request, the Parties submitted their observations on the opinion of the Advocate General Wathelet of the European Court of Justice (ECJ) in case C-284/16 Slowakische Republik v. Achmea BV.
On 25/01/2018 the Parties were informed by the Tribunal's Secretary that the Tribunal hopes to be in a position to render the award in the second quarter of this year.
On 11/04/2018 the Parties, upon the Tribunal's request, submitted their observations on the judgment of the same date (06/03/2018) of the ECJ in said case C-284/16 Slowakische Republik v. Achmea BV, in which the ECJ concluded that the arbitration clause included in a bilateral treaty between two member-states of the European Union (i.e. the bilateral treaty between Slovakia and Law Countries) affects the autonomy of the European Law and therefore it is not compatible with the latter. However, said judgment of the ECJ is not bounding to the Tribunal, whereas in the past arbitral tribunals have rejected the position of the European Union.
Further to that, reservations are maintained as to whether the Tribunal will render the award within the second quarter of this year according to the information received on 25/01/2018.
MIG's Management considers that the issue arisen from the recent judgment of the ECJ must be admitted as referring predominantly to the enforceability of the future award of the Tribunal in the territory of member-states of the European Union. Without prejudice to the foregoing, MIG's Management considers that there are good chances for a positive outcome on the merits, but no assessment can be made with regard to the issue of compensation that in this case may be awarded.
MIG announced that following its appeal against the Republic of Cyprus before the International Arbitration Tribunal, claiming the amount of € 824 m plus interest and additional damages relating to its investment in CYPRUS POPULAR BANK (CPB), the State-owned bank, which has been under resolution since 2013, filed a lawsuit against MIG (as well as among others against Messrs. Vgenopoulos, Bouloutas and Magiras) before the Cypriot courts claiming an amount of over € 2 m without specifying a priori what is the subject of the action, "reserving its right to specify its claims and damages at a later stage".
On 08/05/2013 an Interim Order (Interim Measures) was issued, ordering and forbidding MIG until a new order is issued, inter alia, from transferring to or in favor of A. Vgenopoulos, E. Bouloutas and K. Magiras, any assets – including funds - except if the total value of the assets of the latter without incumbencies and other securities ("unencumbered value") exceeds the amount of €3.79 billion.
On 28/06/2013 MIG filed an application for setting aside the procedure (cancellation of the writ of summons).
On 02/07/2013 A. Vgenopoulos, E. Bouloutas and K. Magiras filed an opposition against CPB's application for an interim order. MIG stated that it would not file an opposition and that it would accept the outcome of the oppositions of the other defendants, without admitting the facts included in CPB's application.
On 23/05/2014 the Court issued its interim decisions whereby it rejected the applications for setting aside the procedure and rendered the interim orders absolute against all defendants and in force until the termination of the trial or until another order of the Court.
MIG filed its appeals against (i) the interim decision dated 23/05/2014 on the set aside application and (ii) the interim decision/order dated 23/05/2014 on the interim order application and the relevant oppositions of the defendants.
On 17/07/2014 MIG filed an application to set aside due to lack of jurisdiction of the District Court of Nicosia and on 04/11/2014 CPB filed its objection. In the meantime CPB filed an application to amend the statement of claim and MIG, consequently, filed its objection. CPB further requested
adjournment of the hearing of the application to set aside due to lack of jurisdiction until after its application to amend the statement of claim is heard. Despite MIG's objection, the Court adjourned the hearing with its interim decision and MIG filed an appeal against it. On 08/09/2015, an interim decision was issued by the Court whereby it allowed the amendment of the statement of claim, against which MIG filed an appeal. The above amendment was filed on 08/09/2015 and was served to the lawyers of the defendants on 11/09/2015. By expressing a number of reservations, CPB specifies the amount of damages to € 3.99 billion.
On 15/02/2016, a hearing was held in relation to a preliminary issue concerning MIG's application to set aside for lack of jurisdiction of the District Court of Nicosia and, specifically, which party has the burden of proof. On 11/04/2016, the Court issued its judgment according to which, as a general rule, the burden of proof lies on the party who is bringing forward an allegation; and specifically in the applications at issue, the burden of proof lies on the applicants - defendants. MIG filed its written submissions on 05/09/2016 and the CPB - on 12/09/2016. Upon A. Vgenopoulos's demise the case was fixed, following successive adjournments, for 03/05/2018 for directions.
By the Notice dated 17/05/2016, MIG was informed about listing of the appeals it had filed against the interim decisions dated 23/05/2014 on 16/06/2016, whereby the Supreme Court set a 90-days deadline for MIG to lodge its Skeleton Argument and subsequently 90 days for CPB to lodge its own Skeleton Argument. MIG filed its Skeleton Argument on 12/09/2016, CPB filed its Skeleton Argument on 12/12/2016 and now the hearing date of the appeal is expected to be determined.
On 31/01/2017 a decision was issued on the set aside applications for lack of jurisdiction of the Nicosia District Court, whereby it admitted its jurisdiction and did not consider the various requests and arguments of the applicants, including the request for referring the matter to the ECJ through a prejudicial request. On 14/02/2017 MIG and Messrs. Bouloutas and Magiras filed an appeal against the above decision. The successors of A. Vgenopoulos must be expected to determine their position accordingly.
With regard to the jurisdiction, MIG obtained an opinion from the Professor Andrian Briggs in Private Law in Oxford University who contends that according to the Regulation (EC) 44/2001 there is no jurisdiction of the Cypriot Courts for the case, which it filed with the Tribunal.
It is hereby noted that CPB has initiated proceedings for the recognition, beyond the Republic of Cyprus and in particular in Greece and in England, of the freezing order dated 23/05/2014, which does not turn against MIG's assets but orders and forbids MIG from transferring to or in favor of Messrs. Vgenopoulos, Bouloutas and Magiras, any assets – including money – except if the total value of assets exceeds the amount of € 3.79 billion. By the decision no. 27/2016 of the Athens 1 membered Court of First Instance (Voluntary Procedure) the above order was declared enforceable in Greece, as explicitly mentioned in the decision of the Athens Court of First Instance. Against this decision MIG (together with the above mentioned defendants) filed an Appeal before the Athens 3 membered Court of Appeal (Contentious Jurisdiction) which was finally rejected by the decision no. 983/2017 of the Athens 3-membered Court of Appeal issued on 02/03/2017. MIG will file before the Supreme Court an application for cessation against said decision.
Furthermore, by the Order of Judge Leslie of High Court of Justice in England and Wales, Queen's Bench Division, dated 26/02/2015, the above order of the Nicosia District Court was declared enforceable in England and Wales. MIG together with the above mentioned defendants has filed an appeal against said Order, the hearing of which is pending. On the basis of the above mentioned Order it was confirmed by the same Court in England that the above Order of Judge Leslie, whereby the Nicosia District Court Order was declared enforceable in England and Wales, will become enforceable in England and Wales only on the final determination of the appeal against it. CPB filed
an appeal against this Order. On 12/01/2018 the Court of Appeal allowed the appeal and awarded CPB the costs of its appeal. Upon CPB's relevant application a decision on interim measures has been issued according to the provisions of article 47(2) and (3) of the Regulation 44/2001 of the Council, which does not concern though MIG's assets. Pending resolution of the estate of the deceased Andreas Vgenopoulos, the appeal is presently stayed by order of the Court dated 24/01/2018. The parties have agreed to the continuation of the stay until 31/07/2018 and await for the Court's confirmation.
The Management considers that the obvious aim of CPB's lawsuit against MIG is the defense of the Republic of Cyprus against MIG's lawful claim that has been subjected to the competent International Arbitration Tribunal. MIG's legal counsels are not yet able to express an opinion on the outcome of the case, at this initial procedural stage, in terms of both illegal acts or omissions and damages, taking into consideration all the circumstances surrounding the case, including the parallel arbitration and criminal proceedings.
The claimants have turned not only against MIG but also against CPB, the former members of the Board of Directors of "Bank of Cyprus Public Company Ltd", "Dubai Financial Limited Liability Company", "Deutsche Bank A.G. London Branch", "PricewaterhouseCoopers Ltd", "Grant Thornton (Cyprus) Ltd", and the Central Bank of Cyprus. The claimants request compensation for damages allegedly caused by acts or/and omissions of the Board of Directors of CPB and by conspiracy among the defendants, which led the CPB into a resolution regime and/or termination of its operations and /or collapse and/or bankruptcy without however making references to specific acts or omissions. The total amount of the requested compensation comes to € 39 m plus interest and costs.
MIG's Management believes that the claim is unsubstantiated, even though its adjudication is still at an early procedural stage and no details of the claim have been given; its legal counsel are not yet able to express an opinion on its outcome.
On 25/07/2016 the Attorney General of the Republic of Cyprus filed before the Nicosia District Court the criminal case no. 15161/16 against 10 (currently 8) defendants including MIG (currently defendant 7). The charge sheet was served on MIG on 08/08/2016. The case concerns a wire transfer of € 1 m made on 27/07/2007 from an account of "Focus Maritime Corporation" (currently defendant 8), a company in which Michael Zolotas (currently defendant 2) has interests in, to an account of "A.C.Christodoulou Consultants Ltd" (currently defendant 6), a company in which Athena Christodoulou (currently defendant 4), daughter of the former Governor of the Central Bank of Cyprus Christodoulos Christodoulou (defendant 1), has interests in. The wire transfer in question is alleged to have been made in order for the latter to refrain from taking appropriate action and investigations concerning MIG's (currently defendant 7) acquisition of control in CPB in February 2006. The above "fee" for said purpose was purportedly agreed to be received by Christodoulos Christodoulou (defendant 1) from Andreas Vgenopoulos and MIG (currently defendant 7). Moreover, as an additional consideration, he purportedly agreed with Andreas Vgenopoulos to have his then son-in-law appointed at a high-ranking position in CPB. At the hearing of 22/03/2017 the Attorney General of the Republic of Cyprus removed A. Vgenopoulos (ex-defendant 2), due to his demise, and K. Magiras (ex-defendant 4), due to the denial of Greek Justice to execute the European
arrest warrant against him, from the charge sheet and committed the case to the Nicosia Assize Court for all other defendants, including MIG.
The case has been set for hearings on 09, 10, 14, 15, 23, 24, 30 and 31/05/2018 and 07, 08, 11, 12, 19, 20, 21, 25, 26 and 27/6/2018.
It is hereby noted that MIG as a legal entity is not obliged to appear in person (through its directors) at Court and may only be condemned to pay a fine. The procedural evolution of the case and in particular to what extent the proceedings will continue with regard to all charges or in general as well is uncertain given the demise of A. Vgenopoulos, the extradition of M. Zolotas for only one charge and the decision of Greek Justice for non-extradition of K. Magiras. The amount of the fine that may be imposed on MIG in case of condemnation as a result of the above in not possible to be estimated at this point.
LOUIS PLC filed a lawsuit against MIG LEISURE before the Nicosia District Court, requesting an order for the execution of the shareholders' agreement with MIG LEISURE dated 13/08/2017 through the purchase by MIG LEISURE of 600,000 shares of the company CTDC owned by LOUIS PLC otherwise the adjudication of relevant compensation, referring to a previous agreement with MIG LEISURE. On 11/01/2016, MIG LEISURE filed its defence at the District Court of Nicosia.
Both sides have completed the procedure of filing affidavits for the disclosure of documents and the case has been fixed for hearing, upon successive adjournments, for 02/10/2018.
MIG LEISURE and MIG question the existence of such an obligation and consider that the said lawsuit is unfounded, however as the hearing has not started yet, the legal counsels are unable to express an opinion on the outcome.
On 18/12/2015, the transfer of all shares of SKYSERV to SWISSPORT AVIAREPS HELLAS S.A. was completed. According to individual terms and conditions of the sale and purchase, MIG has undertaken to compensate likely amounts that SKYSERV is to be asked to pay and for which there was no previous provision in the Financial Statements. Three lawsuits have been filed against SKYSERV by the OLYMPIC AIRWAYS SERVICES S.A. - In Liquidation" (hereinafter "OAS") seeking payment for the total amount of € 5.6 m (plus interest from the lapse of 30 days after issuance of each invoice), invoking the contracts for provision of services entered between the companies on 09/06/2009. The trial of the above cases took place on 21/02/2018, 28/02/2018 and 14/03/2018 and the parties await the decision of the Court.
SKYSERV and MIG contest the existence of the liability and believe that these lawsuits are vague and unfounded. In the context of the trial, OAS provided - objectively - no evidence adequate to lead to the substantiation of its claims in the Court's consideration. Furthermore, SKYSERV raised an objection regarding the abusive filing of each lawsuit, as OAS stated through its legal representative at three different time points that no debt had arisen from the agreements in question and that the invoices in question were supposed to be cancelled even before OAS was put under liquidation, which in fact did not occur. It is believed that even if vagueness is put aside and the Court gets into the merits of the case, eventually the lawsuits will be rejected as factually unsubstantiated or at least as filed abusively.
The minimum future lease payments under non-cancellable operating leases as at 31/12/2017 and 31/12/2016 are as follows:
| THE GROUP | THE COMPANY | ||||
|---|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | |
| Within 1 year | 18,920 | 19,116 | 284 | 472 | |
| After 1 year but not more than 5 years | 47,650 | 57,668 | 295 | 812 | |
| More than 5 years | 52,089 | 41,951 | - | - | |
| Operating lease sort-term commitments pertaining to assets classified as held for sale |
18 | - | - | - | |
| Total operating lease commitments | 118,677 | 118,735 | 579 | 1,284 |
The Group's other commitments are analyzed as follows:
| THE GROUP | |||
|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | |
| Within 1 year | 1,270 | 2,443 | |
| After 1 year but not more than 5 years | - | 733 | |
| Other sort-term commitments pertaining to discontinued operations |
375 | - | |
| Other long-term commitments pertaining to discontinued operations |
370 | - | |
| Total other commitments | 2,015 | 3,176 |
The Group's tax liabilities are not conclusive since there are non-tax audited financial years which are analyzed in Note 2 of the Financial Statements for the year ended on 31/12/2017. For the nontax audited financial years there is a probability that additional taxes and penalties will be imposed when they are assessed and finalized. The Group assesses on an annual basis its contingent liabilities which may result from tax audits of preceding financial years, by forming provisions where it is deemed necessary. The Group has made provisions for non-tax audited financial years amounting to € 1,645k (31/12/2016: € 3,566k).
The Management considers that apart from the formed provisions, potential tax amounts which may arise will not have any significant effect on equity, Profit/Loss and on cash flows of the Group and the Company.
For the years 2011 – 2016, the Group companies operating in Greece and subject to tax audits by Chartered Accountants in accordance with paragraph 5 of Article 82 of Law 2238/1994 and in compliance with the provisions of Article 65Α par. 1, Law 4174/2013, received a Certificate of Tax Compliance without any substantial differences. Under the Circular POL 1006/2016, the companies that have been subject to this special tax audit are not exempted from the statutory audit of the competent tax authorities. The Management of the Group estimates that in case such audits are carried out by the Tax Authorities in the future, no additional tax differences will arise with a significant effect on the Financial Statements.
Regarding the financial year 2017, the special audit for the issue of the Certificate of Tax Compliance is currently in progress and the relevant tax certificates are expected to be issued following the publication of the annual Financial Statements for FY 2017. Should any additional tax liabilities arise till the finalization of the tax audit, it is estimated that they will not have a material effect on the Financial Statements. It is to be noted that under the recent legislation, such audit and the issue of the Certificate of Tax Compliance for 2016 and onwards are optional.
It is to be noted that on 31/12/2017 FYs until 31/12/2011 were written off in compliance with the provisions of Par. 1, Article 36, Law 4174/2013.
Financial assets and financial liabilities measured at fair value in the Statement of Financial Position of the Group and the Company are classified under the following 3 level hierarchy in order to determine and disclose the fair value of financial instruments per valuation technique:
The following tables reflect the Group financial assets and liabilities measured at fair value on a recurring basis on 31/12/2017 and 31/12/2016:
| 31/12/2017 | 31/12/2016 | |||||||
|---|---|---|---|---|---|---|---|---|
| Financial assets | Fair value measurement at end of the reporting period using: |
Fair value measurement at end of the reporting year using: |
||||||
| Amounts in € '000 | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total |
| Financial assets at fair value through profit or loss |
||||||||
| - Securities | 25 | - | - | 25 | 109 | - | - | 109 |
| - Mutual Funds | - | 367 | - | 367 | 1,988 | 725 | - | 2,713 |
| - Bonds | - | 45 | - | 45 | - | 45 | - | 45 |
| - Derivatives | - | 4,433 | - | 4,433 | - | 5,877 | - | 5,877 |
| Financial assets of investment portfolio | ||||||||
| - Equity instruments of non-listed entities | - | - | 231 | 231 | - | - | 362 | 362 |
| - Shares listed in foreign stock exchanges | 122 | - | - | 122 | 109 | - | - | 109 |
| Non-recurring fair value measurments | ||||||||
| -Assets Held for sale | - | 27,359 | - | 27,359 | - | - | - | - |
| Total financial assets | 147 | 32,204 | 231 | 32,582 | 2,206 | 6,647 | 362 | 9,215 |
| Financial liabilities | ||||||||
| - Loans | - | 76,428 | - | 76,428 | - | 69,214 | - | 69,214 |
| Non-recurring fair value measurments | ||||||||
| -Liabilities Held for sale | - | 27,359 | - | 27,359 | - | - | - | - |
| Total financial liabilities | - | 103,787 | - | 103,787 | - | 69,214 | - | 69,214 |
| Net fair value | 147 | (71,583) | 231 | (71,205) | 2,206 | (62,567) | 362 | (59,999) |
| 31/12/2017 | 31/12/2016 | ||||||
|---|---|---|---|---|---|---|---|
| Financial assets | Fair value measurement at end of the reporting period |
Fair value measurement at end of the reporting period |
|||||
| Amounts in € '000 | Level 1 Level 2 Total |
Level 1 | Level 2 | Total | |||
| Financial assets at fair value through profit or loss | |||||||
| - Securities | - | - | - | 90 | - | 90 | |
| - Mutual Funds | - | 367 | 367 | - | 725 | 725 | |
| Total financial assets | - | 367 | 367 | 90 | 725 | 815 | |
| Net fair value | - | 367 | 367 | 90 | 725 | 815 |
There were no transfers between Levels 1 and 2 during financial years 2017 and 2016.
Investments in listed shares in domestic and foreign stock markets are valued based on the quoted market prices of these shares. Investments in unquoted shares are valued based on widely accepted valuation models which sometimes incorporate data based on observable market inputs and sometimes are based on unobservable data.
The changes in the Group's and the Company's financial instruments classified in Level 3 for the financial years 2017 and 2016 are presented as follows:
| THE GROUP | |||||
|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | ||||
| Amounts in € '000 | Financial assets of investment portfolio |
Financial assets of investment portfolio |
|||
| Equity instruments of non-listed entities |
Equity instruments of non-listed entities |
||||
| Opening balance | 362 | 783 | |||
| Sales | (1,128) | - | |||
| Issues and settlements | - | (421) | |||
| Total gains/(losses) recognised in profit or loss under line item: |
|||||
| - Other financial results | 997 | - | |||
| Closing balance | 231 | 362 | |||
| Total amount included in profit or loss for unrealized gains /(losses) on Level 3 instruments |
997 | - |
The following table presents non-financial assets of the Group measured at fair value on a recurring basis on 31/12/2017 and 31/12/2016:
| 31/12/2017 | 31/12/2016 | |
|---|---|---|
| Fair value measurement at end of the reporting period |
Fair value measurement at end of the reporting year |
|
| Amounts in € '000 | Level 3 | Level 3 |
| Investment Property | ||
| - Buildings in Greece | 167 | 167 |
| - Buildings in Serbia | 265,711 | 275,058 |
| Total non-financial assets | 265,878 | 275,225 |
Determination of the fair value of the Group's Level 3 investment property is based on a relevant valuation work performed by an independent property appraisal firm. Indicatively, in respect to the
investment property valuation, the key assumptions used, which were based on unobservable data, are summarized in the following table:
| 31/12/2017 | 31/12/2016 | |
|---|---|---|
| Assumptions | Balkans | Balkans |
| Rental value | € 2,8-€ 90 / sqm | € 2,8-€ 95 / sqm |
| Discount rate | 7,2%-11,8% | 6,9%-10,9% |
Each one of MIG's large investments is exposed to specific risks. The occurrence of any of these risks could lead to a possible revaluation of MIG's portfolio and to the reassessment of the strategic objectives of the Group.
Τhe Company and the Group are exposed to risks pertaining to financing, interest rates, fuel prices, liquidity, credit and currencies. The Group reviews and periodically assesses its exposure to the risks cited above on a case by case basis as well as collectively and uses financial instruments to hedge its exposure to certain risk categories.
Evaluation and assessment of the risks faced by the Company and the Group are conducted by the Management and the Board of Directors of the Company. The main aim is to monitor and assess all the risks to which the Company and Group are exposed to through their business and investment activities.
The Group uses several financial instruments or pursues specialized strategies to limit its exposure to changes in the values of investments that may result from market volatility, including changes in prevailing interest rates and currency exchange rates.
The Group's functional currency is the Euro. The Group operates in foreign countries and therefore is exposed to currency risk. This type of risk mainly arises from current or future cash flows in foreign currency and from investments outside the Eurozone. The largest percentage of MIG's and the Group's revenue and costs are Euro denominated. Likewise, the largest percentage of the Company's investments is denominated in Euro.
In managing currency risk, the Group uses derivatives (forward FX contract agreements) with financial institutions for the Group's companies. The Group holds foreign investments whose net assets are exposed to FX risk. FX risk stems from the exchange rates to the USD, UK Sterling, Albanian Lek, Bulgarian Lev, Romanian Ron and other currencies of European countries and is partially offset by respective liabilities in the same currencies.
The Group's investment in Serbian RKB isnot exposed to FX risk since their assets (investment properties and other intangible assets) are denominated in Euro and the largest part of the relevant inflows is in Euro. It is noted, that in other markets where the Group operates (other Balkan countries) the financial needs of each company are assessed, and if feasible, the financing is in the same currency with the relevant asset being financed or that is going to be financed.
The analysis of the Group's financial assets and liabilities per currency converted in Euro as at 31/12/2017 and 31/12/2016 is presented as follows:
| THE GROUP 31/12/2017 |
|||||||
|---|---|---|---|---|---|---|---|
| Amounts in € '000 | USD | GBP | LEK | BGN | RON | Other | |
| Notional amounts | |||||||
| Financial assets | 1,113 | 49 | 1,652 | 8,170 | 2,143 | 477 | |
| Financial liabilities | (143) | (122) | (8,435) | (3,529) | (1,945) | (559) | |
| Short-term exposure | 970 | (73) | (6,783) | 4,641 | 198 | (82) | |
| Financial assets | - | - | 25,698 | 1 | - | 190 | |
| Financial liabilities | - | - | - | (192) | - | - | |
| Long-term exposure | - | - | 25,698 | (191) | - | 190 |
| THE GROUP 31/12/2016 |
|||||||
|---|---|---|---|---|---|---|---|
| Amounts in € '000 | USD | GBP | LEK | BGN | RON | Other | |
| Notional amounts | |||||||
| Financial assets | 962 | 746 | 1,697 | 7,890 | 2,392 | 237 | |
| Financial liabilities | (368) | (21) | (7,677) | (3,680) | (1,544) | (1,209) | |
| Short-term exposure | 594 | 725 | (5,980) | 4,210 | 848 | (972) | |
| Financial assets | - | - | 36,752 | 1 | - | 188 | |
| Financial liabilities | - | - | - | (345) | - | - | |
| Long-term exposure | - | - | 36,752 | (344) | - | 188 |
The following table shows the FX sensitivity analysis on the Group's results and equity by taking into consideration a change in FX rates by +/- 10%.
| THE GROUP | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| 10% | -10% | 10% | -10% | 10% | -10% | 10% | -10% | 10% | -10% | |
| 31/12/2017 | ||||||||||
| Amounts in € '000 | USD | GBP | LEK | RON | Other | |||||
| Profit for the period (before tax) | 88 | (88) | (9) | 9 | - | - | 4 | (4) | 11 | (11) |
| Equity | 88 | (88) | (9) | 9 | (1,985) | 1,985 | 4 | (4) | 11 | (11) |
| 31/12/2016 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Amounts in € '000 | USD | GBP | LEK | RON | Other | |||||
| Profit for the financial year (before tax) | 59 | (59) | 73 | (73) | - | - | 19 | (19) | (75) | 75 |
| Equity | 59 | (59) | 73 | (73) | (1,661) | 1,661 | 19 | (19) | (75) | 75 |
Sensitivity analysis for the currency Lev is not included in the table above, because the exchange rate of EURO/LEV is fixed.
The Group's exposure to FX risk varies during the financial year depending on the volume of the transactions and its wider FX risk exposure. However, the above analysis is considered to be representative of the Group's FX risk exposure.
Changes in interest rates can affect the Group's net income by increasing the costs of servicing debt used to finance the Group. Changes in the interest rates can also affect, amongst others: (a) the cost and availability of debt financing along with the Company's ability to achieve attractive rates of
return on its investments; and (b) the debt financing capability of the investments and of the businesses in which the Group invests.
Bank debt constitutes one of the funding sources of the Group's investments. A large portion of the Group's debt pays floating interest rates and therefore is directly dependent upon interest rate levels and fluctuations, a fact which exposes the Group to cash flow risk. The Group's floating rates are converted into fixed rates through hedging instruments which are in turn offset to a significant degree by bank deposits. The Group's policy is to constantly monitor interest rate trends as well as the duration of its financial needs. Thus, decisions about the duration along with the relationship between fixed and floating rate of a new loan, are taken separately for each case.
The table below presents the sensitivity on the Group's and the Company's results and equity for the period based on a reasonable fluctuation in the interest rate in the range of +/- 1%:
| THE GROUP | ||||||
|---|---|---|---|---|---|---|
| 1% | -1% | 1% | -1% | |||
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | ||||
| Profit for the financial year (before tax) | (16,968) | 16,968 | (17,544) | 17,544 | ||
| Equity | (16,968) | 16,968 | (17,544) | 17,544 | ||
| THE COMPANY | ||||||
| 1% | -1% | 1% | -1% | |||
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | ||||
| Profit for the financial year (before tax | (6,929) | 6,929 | (6,813) | 6,813 | ||
| Equity | (6,929) | 6,929 | (6,813) | 6,813 |
The Group's and the Company's exposure in relation to its investments stems from possible adverse price movements in the market prices of equities and other listed securities.
It is noted that:
The risk of the Group and the Company with respect to the trading portfolio, financial instruments at fair value through profit or loss and the investment portfolio arises from potential adverse changes in the market prices of shares and other securities. On 31/12/2017, the assets exposed to market risk amounted to € 5 m for the Group and € 0.4 m for the Company respectively. A fluctuation of +/- 30% in investments whose valuation gains or losses are recognized in other comprehensive income and cumulatively in equity, would lead to a change of +/- € 0.2 m for the Group and +/- € 0.1 m for the Group.
Credit risk is the potential delayed payment to the Group and the Company of its current and future receivables by its counterparties. The assets exposed to credit risk on the statement of Financial Position as of the reporting date are analyzed as follows:
| THE GROUP | THE COMPANY | ||||
|---|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 31/12/2017 |
31/12/2016 | ||
| Financial assets | |||||
| Derivative financial instruments | 4,433 | 5,877 | - | - | |
| Cash and cash equivalents | 130,507 | 142,900 | 9,554 | 10,197 | |
| Trade and other receivables | 243,617 | 253,785 | - | - | |
| Total | 378,557 | 402,562 | 9,554 | 10,197 |
Aiming at minimizing credit risk and bad debts, the Group has adopted efficient processes and policies in relation to exposure limits per counterparty based on the counterparty's credibility.
Maturity of the Group's trade receivables as at 31/12/2017 is as follows:
| THE GROUP | |||||||
|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Food & Dairy |
Transportation | Private Equity |
IT & Telecoms |
Healthcare | Eliminations | Total |
| Are delayed but not impaired: | |||||||
| < 90 days | 9,590 | - | 1,447 | 2,834 | 5,700 | (531) | 19,040 |
| < 91 - 180 days | 1,037 | - | 144 | 1,177 | 6,954 | (115) | 9,197 |
| < 181 - 360 days | 606 | 1,567 | 652 | 361 | 7,170 | (652) | 9,704 |
| > 360 days | 3,253 | - | 239 | 67 | 9,008 | (239) | 12,328 |
| Total | 14,486 | 1,567 | 2,482 | 4,439 | 28,832 | (1,537) | 50,269 |
It is noted that in the amounts that are not impaired and are delayed by more than 360 days, are included: a) HYGEIA group's receivables amounting to € 9.0 m which include receivables of approximately € 3.5 m from Public Insurance Funds up to 31/12/2011, as well as the amount owed by EOPYY for the period 2012, prior to the implementation of Claw-back and Rebate, amounting to € 5.5 m, and b) receivables of VIVARTIA group amounting to € 3.0 m, from which € 1.9 m arise from the food services subsector as a result of the accumulated pressure on the liquidity of the businesses operating in the sector and the market conditions. The remaining amount mainly arises from the frozen sector (€ 1.1 m) and mostly relates to balances from affiliated companies expected to be collected in the near future.
The Group's Management constantly monitors the maturity of its trade receivable applying strict criteria and in this context it was not considered appropriate to make additional provision for the above receivables.
Maturity of the Group's trade receivables as at 31/12/2016 is as follows:
| THE GROUP | |||||||
|---|---|---|---|---|---|---|---|
| Amounts in € '000 | Food & Dairy |
Transportation | Private Equity |
IT & Telecoms |
Healthcare | Eliminations | Total |
| Are delayed but not impaired: | |||||||
| < 90 days | 20,038 | - | 1,950 | 2,452 | 5,774 | (1,290) | 28,924 |
| < 91 - 180 days | 6,629 | - | 586 | 1,508 | 6,703 | (563) | 14,863 |
| < 181 - 360 days | 9,071 | 2,603 | 116 | 1,725 | 6,712 | (116) | 20,111 |
| > 360 days | 6,585 | - | 10 | 697 | 10,705 | (10) | 17,987 |
| Total | 42,323 | 2,603 | 2,662 | 6,382 | 29,894 | (1,979) | 81,885 |
Prudent liquidity risk management implies cash adequacy as well as the existence and availability of necessary funding sources. The Group is managing its liquidity requirements on a daily basis through systematic monitoring οf it's short and long-term financial liabilities and through daily monitoring of the payments made. Furthermore, the Group constantly monitors the maturity of its receivables and payables, in order to maintain a balance between capital continuity and flexibility via its bank credit worthiness.
Maturity of financial liabilities as at 31/12/2017 and 31/12/2016 for the Group and the Company is analyzed as follows:
| THE GROUP | ||||||||
|---|---|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | |||||||
| Amounts in € '000 | Short-term | Long-term | Short-term | Long-term | ||||
| Within 6 months |
6 to 12 months |
1 to 5 years |
More than 5 years |
Within 6 months |
6 to 12 months |
1 to 5 years |
More than 5 years |
|
| Long-term borrowing | 98,608 | 120,976 | 964,417 | 13,872 | 60,162 | 193,897 | 807,636 | 44,403 |
| Liabilities relating to operating lease agreements |
725 | 760 | 2,604 | - | 657 | 689 | 3,948 | - |
| Trade payables | 165,608 | 4,540 | - | - | 172,589 | 8,019 | - | - |
| Other short-term-long-term liabilities |
164,482 | 11,117 | 6,045 | 400 | 148,334 | 16,118 | 11,359 | 400 |
| Short-term borrowing | 368,144 | 54,197 | - | - | 391,687 | 171,403 | - | - |
| Derivative financial instruments | - | - | - | - | - | - | - | - |
| Total | 797,567 | 191,590 | 973,066 | 14,272 | 773,429 | 390,126 | 822,943 | 44,803 |
| THE COMPANY | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 31/12/2017 | 31/12/2016 | ||||||||
| Amounts in € '000 | Short-term | Long-term | Short-term | Long-term | |||||
| Within 6 months |
6 to 12 months |
1 to 5 years |
More than 5 years |
Within 6 months |
6 to 12 months |
1 to 5 years |
More than 5 years |
||
| Long-term borrowing | 32,250 | 26,500 | 623,950 | - | 44,903 | 58,722 | 597,144 | - | |
| Other short-term-long-term liabilities |
15,634 | - | 4,955 | - | 12,648 | - | 9,514 | - | |
| Short-term borrowing | 16,822 | - | - | - | 3,270 | - | - | - | |
| Total | 64,706 | 26,500 | 628,905 | - | 60,821 | 58,722 | 606,658 | - |
As presented in the table above, total debt of the Group on 31/12/2017 amounted to € 1,624,303k. Long term debt amounted to € 980,893k while short term debt amounted to € 643,410k. Respectively, total debt of the Company on 31/12/2017 amounted to € 699,522k, of which € 623,950k was long term debt and € 75,572k was short term debt.
The Group and the Company on 31/12/2017 had negative working capital, since current liabilities exceeded current assets by € 488,765k and € 75,266k respectively. This issue will be solved following the successful completion of the restructuring of the debt of the companies of the Group (see note 3.1 and 27).
Group companies operating in the transportation sector are significantly affected by fuel price fluctuations, since it constitutes one of their main operating costs. An increase or decrease in fuel
prices by 10% on an annual basis would affect the Group's results and equity position by approximately -/+ € 8.3 m.
The transportation sector, given its operational nature, is subject to accident risks that can have adverse effects on results, clients and operations. ATTICA group vessels are insured against the following risks: a) vessel and machine insurance, b) increased value insurance and c) war risk insurance.
Competition between the companies operating in the transportation, healthcare and food and dairy sectors is particularly intense and could adversely affect their sales and profitability.
In the transportation sector, the economic recession combined with the intense competition in passenger shipping has resulted in a continuous effort by the companies to maintain or expand their market shares which could lead to more competitive prices, as well as to potential adverse effects on the Group's sales and profitability.
In the healthcare sector, the competition between the companies is particularly intense mainly because the Public Sector has been unable to cover the ever growing demand and to offer quality healthcare services.
In this context, private clinics focused on broadening the services provided and on improving the response time to patients, through expansion of the existing facilities to house new departments. For instance, several private clinics include from maternal to diagnostic departments in order to widen the range of services provided.
Another aspect of competition observed in the subsector of provision of private healthcare services is the expansion of collaboration between the private units and the insurance companies to cover hospitalization costs for a wider range of patients. By making use of its comparative advantages, HYGEIA group focuses on the continuous improvement of the high quality healthcare services rendered according to the internationally certified standards and, as such, HYGEIA group is currently the leader in the Greek sector of private healthcare services.
However, should HYGEIA group discontinue its development and investment policy, its competitive position might be significantly affected, which would also affect its financial position.
The food and dairy sector and in particular the subsectors where VIVARTIA group is present (dairy, frozen vegetables and pastry, food services) are facing accentuated competition from both large domestic or international entities in the specific subsectors, as well as from very small national or local competitors. Potential changes in the frameworks that govern the above subsectors (e.g. product life, labelling of product origin, food and beverage VAT, social insurance and employment regulations, etc.) create conditions of intense competition. Additionally, following the general consumption trend globally, but also in particular due to the persisting economic conditions in Greece, there has been a constant increase in the consumption of private label products, which affects the competition in dairy, frozen vegetables and pastry products. Finally, the food services subsector is present in an equally intense competition environment with the majority of its competitors consisting of non-organized networks, specifically stand-alone shops. The deficiency of the controlling mechanisms creates skewed conditions (non-issuance of receipts, tax evasion, nonregistered employment, non-payment of social security contributions, etc.) and hence unfair competition between the organized chains and the personal businesses with an obvious impact on their sales and profitability.
ATTICA group operates on marine lines of intense competition which can be further intensified in the effort of the companies to acquire a larger share in already mature markets.
The Group's targets in terms of capital management are the following:
The Group monitors capital in terms of equity, less cash and cash equivalents as presented in the statement of Financial Position. The capital for the financial years 2017 and 2016 is analyzed as follows:
| THE GROUP | THE COMPANY | ||||
|---|---|---|---|---|---|
| Amounts in € '000 | 31/12/2017 | 31/12/2016 | 31/12/2017 | 31/12/2016 | |
| Total equity | 350,167 | 429,010 | 574,062 | 666,095 | |
| Cash, cash equivalents & restricted cash | (130,507) | (142,900) | (9,554) | (10,197) | |
| Capital | 219,660 | 286,110 | 564,508 | 655,898 | |
| Total equity | 350,167 | 429,010 | 574,062 | 666,095 | |
| Plus: Loans | 1,624,303 | 1,674,482 | 699,522 | 704,039 | |
| Total capital | 1,974,470 | 2,103,492 | 1,273,584 | 1,370,134 | |
| Capital to Total capital | 1:8,99 | 1:7,35 | 1:2,26 | 1:2,09 |
The Group defines the amount of capital in relation to its total capital structure i.e. equity and financial liabilities without taking into account subordinated debt. The Group manages its capital structure and proceeds with adjustments while financial conditions and risk characteristics of existing assets change. Aiming at retaining or adjusting its capital structure, the Group may adjust the dividends paid, return capital to its shareholders, issue new share capital or dispose assets in order to reduce debt.
On 20/04/2018 MIG in reply to a relevant query of the Capital Market Commission with regard to press reports announced that in the context of a confidentiality agreement usual in such occasions information was provided to the investment funds of CVC CAPITAL PARTNERS regarding HYGEIA. MIG has not received so far any binding offer and reiterates that it will proceed to relevant Announcements to the investors, if any proposal or agreement required to be disclosed arises.
On 27/07/2018 MIG announced that the Board of Directors, at its meeting of 26/04/2018, elected Messrs. Konstantinos Galiatsos and Anastassios Kyprianidis as New Members of the Board of Directors in filling vacant seats, in accordance with the Company's Articles of Incorporation and the current legislation. Futher to that, the Board of Directors consists as follows:
On 25/04/2018 , the Hellenic Competition Commission (HCC), in its decision, approved the acquisition of sole control of HELLENIC SEAWAYS S.A. by ATTICA. The approval of the Hellenic Competition Commission took place after commitments from ATTICA, which, in the Hellenic Competition Commission's view, are adequate, sufficient and fair to ensure healthy competition in the Greek Ferries market. The commitments are described in detail in the Press Release issued by the Hellenic Competition Commission and posted on the Hellenic Competition Commission 's website at www.epant.gr.
Following the approval, ATTICA will proceed immediately to the completion of the required contractual actions for the acquisition of 98.83% of the share capital of HELLENIC SEAWAYS S.A.
Apart from the aforementioned, there are no events posterior to the Financial Statements, regarding either the Group or the Company, which may require reference by IFRS.
The separate and consolidated Financial Statements for the financial year which ended on 31/12/2017 were approved by the Board of Directors of MARFIN INVESTMENT GROUP HOLDINGS S.A. on 30/04/2018.
| The Chairman of the | The Chief Executive | The Chief Financial | The Chief |
|---|---|---|---|
| BoD | Officer | Officer | Accountant |
| Panagiotis | Athanasios | Christophe | Stavroula |
| Throuvalas | Papanikolaou | Vivien | Markouli |
I.D. No: ΑΚ543083 Papanikolaou Passport No: ΑΝ4135328
Vivien Passport No: 14AD07810
Markouli
I.D. No: ΑΒ656863
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