Quarterly Report • May 16, 2023
Quarterly Report
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prepared pursuant to the provisions of Law no. 24/2017, Law no. 74/2015, Law no. 243/2019, ASF Regulation no. 10/2015, ASF Regulation no. 7/2020, ASF Regulation no. 5/2018, and ASF Rule no. 39/2015 this report is provided as a free translation from Romanian, which is the official and binding document
| 1. GENERAL INFORMATION | 3 |
|---|---|
| 2. MAIN FINANCIAL AND OPERATIONAL INFORMATION | 4 |
| 3. PORTFOLIO AS OF MARCH 31, 2023 | 5 |
| 4. THE SHARES ISSUED BY LION CAPITAL S.A. | 11 |
| 5. THE MANAGEMENT OF SIGNIFICANT RISKS | 13 |
| 6. SIGNIFICANT EVENTS DURING Q1 2023 | 19 |
| 7. FINANCIAL POSITION AND RESULTS AS OF MARCH 31, 2023 | 23 |
| 8. EVENTS AFTER THE REPORTING PERIOD | 26 |
| CORPORATE NAME | Lion Capital S.A. (hereinafter referred to as "Lion Capital", "the Fund" or "the Company") the new corporate name starting March 24, 2023, of SIF Banat-Crișana S.A. |
|---|---|
| COMPANY TYPE | ▪ joint stock company, Romanian legal entity with entire private capital ▪ established as a self-managed investment company, authorized by the Financial Supervisory Authority as Alternative Investment Fund Manager (AIFM) - Authorization no. 78 / 09.03.2018, and as closed ended alternative investment fund, diversified, addressed to retail investors (AIFRI) - Authorization no. 130 / 01.07.2021 |
| SHARE CAPITAL | ▪ RON 50,751,005.60 – subscribed and paid-up capital ▪ 507,510,056 shares issued; 506,520,056 outstanding as of 31.03.2023 ▪ RON 0.10 per share nominal value |
| REGISTRATIONS | ▪ Number in Trade Register J02/1898/1992 ▪ Tax Identification Code RO 2761040 ▪ Number in ASF AFIAA Register PJR07.1AFIAA / 020007 / 09.03.2018 ▪ Number in ASF FIAIR Register PJR09FIAIR / 020004 / 01.07.2021 ▪ Legal Entity Identifier (LEI) 254900GAQ2XT8DPA7274 |
| MAIN ACTIVITY | Main activity is, as per the classification of economic activities in the national economy (CAEN): financial intermediation, except for insurance and pension funds (CAEN code 64), and the main object of activity: Other financial intermediation n.c.a. (CAEN code 6499): ▪ portfolio management ▪ risk management ▪ other activities carried out within the collective management of an investment fund, allowed by the legislation in force |
| TRADING MARKET | The company is listed since November 1, 1999 on the regulated market of Bucharest Stock Exchange (BVB) – Premium category - ticker SIF1 |
| FINANCIAL AUDITOR | Deloitte Audit S.R.L. |
| DEPOSITARY BANK | Banca Comercială Română (BCR) |
| SHARES AND SHAREHOLDERS' REGISTRY |
Depozitarul Central S.A. Bucharest |
| HEADQUARTERS | Arad, 35A Calea Victoriei 310158, Romania TEL +40257 304 438 FAX +40257 250 165 EMAIL [email protected] WEB www.sif1.ro |
| BRANCH OFFICE | SIF Banat-Crișana SA Arad-Bucharest Branch-Rahmaninov 46-48 S. V. Rahmaninov Str., 3rd floor, sector 2, 020199, Bucharest |
CONTACT Investor Relations: email [email protected] tel +40257 304 446
| 31.12.2022 | 31.03.2023 | |
|---|---|---|
| Total assets, of which | 3,405.26 | 3,465.80 |
| Total financial assets | 3,374.95 | 3,439.39 |
| Equity (own capital) | 3,242.85 | 3,307.01 |
| Total liabilities | 162.41 | 158.79 |
| 31.03.2022 | 31.03.2023 | |
|---|---|---|
| Operating income | 33.74 | 3.04 |
| Gain/(Loss) on investment | (63.95) | 33.98 |
| Operating expenses | 4.67 | 4.88 |
| Gross profit / (Loss) | (34.88) | 32.14 |
| Net profit / (Loss) | (36.25) | 32.14 |
* calculated acc. to ASF regulations
** calculated excluding the shares repurchased by the Company
| 31.12.2022 | 31.03.2023 | |
|---|---|---|
| Number of permanent employees | 32 | 31 |
| Branch offices | 1 | 1 |
| number of shareholders | holdings | |
|---|---|---|
| Romanian individuals | 5,738,043 | 40.24% |
| Non-resident individuals | 2,128 | 0.33% |
| Romanian legal entities | 112 | 43.43% |
| Lion Capital* | 1 | 0.20% |
| Non-resident legal entities | 22 | 15.80% |
| TOTAL | 5,740,306 | 100% |
* treasury shares, repurchased in 2023
Lion Capital's investment strategy aims to maximize the portfolio performance to increase the value of the assets under management and the investment income.
The financial objective is to reap an aggregate return on the portfolio generated from dividend and capital gains.
Lion Capital has as investment objective is the efficient management of a diversified portfolio comprised of high-quality assets, capable of providing a steady flow of revenues, the preservation and medium-long term capital growth, to increase the value for shareholders and obtain as high yields for the invested capital.
The strategic allocations by asset classes and within each class are based on the assessments of the individual attractiveness of investment opportunities, under the conditions of the macroeconomic and market environment at the time.
Lion Capital's investments, as AIFRI, are made exclusively in the assets and within the limits regulated by Law no. 243/2019 on the regulation of alternative investment funds and for the amendment and completion of some normative acts.
Investments are performed over a certain period, complying to the regulated prudential terms, under appropriate risk monitoring and control, to ensure a steady balance of risk and expected return. The investment decision-making process is formalized through internal procedures and the levels of competence approved by the company's Board of Directors.
The company applies an exit strategy tailored to the specifics of each investment, defined based on the applied strategy, the investment objectives, the conditions of the exit transaction.
The execution of various exit strategies is tailored and correlated with various internal and external factors, such as: the general economic outlook; the evolution of financial markets; liquidity of listed securities and daily trading volumes; the regionality of small businesses; access barriers (interest), depending on the shareholding structure; the liquidity requirement of Lion Capital.
As of March 31, 2023, Lion Capital has under management a complex portfolio of financial instruments, consisting of (i) capital instruments: listed shares, unlisted shares; (ii) debt instruments: corporate bonds, bank deposits, fund units issued by AIF.
Lines of action in portfolio management:
In the investment process, Lion Capital recognizes that global sustainability challenges, including climate change, resource scarcity and human rights are critically important and must be addressed. In this sense, to provide long-term value to the investments made, Lion Capital analyses the sustainability risk of issuers with respect to the criteria applied to determine whether an economic activity qualifies as sustainable and contributes substantially to one or more of the objectives of durability.
Both the Policy on integrating ESG risks in the investment decision-making process as well as the Statement prepared in accordance with the provisions of art. 4 (1) of Regulation (EU) 2019/2088 of the European Parliament and of the Council of 27 November 2019 on sustainability‐related disclosures in the financial services sector are available for consultation on Company's website, www.lion-capital.ro, in the Corporate Governance section.
Lion Capital's net asset value (NAV) was of RON 3,304.37m as of March 31, 2023, up 2.025% vs. RON 3,238.77m, the value recorded as of December 31, 2022, and 1.026% higher vs. March 31, 2022 (RON 3,270.80m). Net asset value per share (NAV/S) was of RON 6.5237 as of March 31, 2023 (December 31, 2022: RON 6.3178/share and March 31, 2022: RON 6.4448/share).
NET ASSET VALUE MARCH 2022 - MARCH 2023
The calculation of NAV and NAV/S is performed by Lion Capital with a monthly frequency, the values being certified by the depositary bank Banca Comercială Română (BCR).
The monthly reports on NAV have been communicated to the Bucharest Stock Exchange and the Financial Supervisory Authority - Financial Instruments and Investments Sector, published on the website of Lion Capital, www.lion-capital.ro, within the regulated terms.
During the reporting period, the calculation of net asset value was made in accordance with the provisions of Law no. 243/2019 on alternative investment funds, amending and supplementing certain normative acts and of the ASF Regulation no. 7/2020 on the authorization and operation of alternative investment funds with subsequent amendments and additions. The reporting formats of the statement of assets and liabilities, and the detailed statement of investments, related to the reporting period comply with the content established by annex no. 10, respectively annex no. 11 to ASF Regulation no. 7/2020, with subsequent amendments and additions.
According to ASF Regulation no. 7/2020, the net asset value of an AIFRI established as an investment company is determined as the difference between the total value of the assets and the sum of the accrued expenses and deferred income. Both current and non-current liabilities (including deferred income tax) are included in the calculation of the total value of liabilities, as well as established provisions. In accordance with these regulations, starting with July 1, 2021, following the authorization of SIF Banat-Crișana as AIFRI (ro: FIAIR), the company calculated the net asset value by adding the deferred profit tax (non-current debt) to the total liabilities.
The statement of Lion Capital's assets and liabilities as of March 31, 2023, prepared as per the provisions of annex 10 to Regulation no. 7/202 is presented as annex to this report.
Throughout the reporting period, the valuation of assets for the calculation of net asset value was carried out in accordance with the regulations issued by the Financial Supervisory Authority, the provisions of ASF Regulation no. 10/2015 and of ASF Regulation no. 9/2014 (art. 113-122), with subsequent amendments and completions.
As per these regulations:
Financial instruments admitted to trading or traded in the last 30 trading days on a regulated market or in systems other than regulated markets, including in an alternative trading system in Romania, from a Member State or a non-member, are measured:
a) At the closing price of the market segment considered as the main market or the reference price provided in trading systems other than regulated markets including alternative systems by the operator of that trading system for the day for which the calculation is made;
c) The Company maintained in 2022 this valuation method for the following portfolio companies: SIF Imobiliare PLC (symbol SIFI), SIF Hoteluri SA (symbol CAOR), and IAMU SA (symbol IAMU). The analysis carried out by the company revealed that for the issuers SIF Imobiliare, SIF Hoteluri and IAMU, the active market criteria are not met, as during 2022 transactions representing less than 1% of the issuer's share capital were recorded, the total number of transactions being less than 50 (in the last 12 months), their frequency being insufficient to meet the criterion of providing reliable price information on an ongoing basis.
Securities not admitted to trading on a regulated market or not traded in the last 30 trading days are valued at the book (accounting) value per share resulting from the last annual financial statements, respectively the value of equity included in the monthly reports to BNR (National Bank of Romania) for credit institutions.
In the case of joint stock companies not admitted to trading in a regulated market or alternative system, in which Lion Capital holds more than 33% of the share capital, those shares are measured in Lion Capital's net asset exclusively in accordance with the international standards evaluation based on an evaluation report, updated at least annually. These companies are presented in a separate annex under the Detailed Portfolio Statement.
Fixed income financial instruments are measured using the method based on the daily recognition of interest and amortization of the discount / premium for the period passed from the date of the investment.
The shares of companies in insolvency, judicial liquidation or reorganization proceedings are valued at zero until the procedure is completed.
The values of non-portfolio items taken into account in the calculation of net assets are in accordance with International Financial Reporting Standards ("IFRS").
The valuation methods applied by the Company to evaluate the financial assets in the portfolio are presented on Company's website, www.lion-capital.ro, in the operating documents as AIFRI, namely Simplified Prospectus, Rules of the Fund in the section Corporate Governance › AIFRI, and in the section Investments › Net Asset › Net asset value calculation methodology.
The asset allocation strategy aims to maximize the portfolio performance under regulated prudential requirements.
The investment limits and restrictions incidental to the operations carried out by Lion Capital during Q1 2023 complied with the applicable legal provisions, established by Law no. 243/2019 on the regulation of alternative investment funds, given that in accordance with the provisions of this law Lion Capital is classified as a Closed, Diversified Alternative Investment Fund addressed to retail investors (AIFRI).
During Q1 2023, no violations of the regulated prudential investment limits were recorded.
The detailed statement of Lion Capital's investments as of March 31, 2023, prepared pursuant to Annex 11 of Regulation no. 7/2020, is presented as annex to this report.
Total value of assets under Lion Capital's management as of March 31, 2023, was of RON 3,463m, 1.823% higher than the value recorded as of December 31, 2023, viz. RON 3.401m.
The value of the stock portfolio (listed and unlisted shares) accounted for 82% of Lion Capital's total assets as of March 31, 2023, amounting to RON 2,854.36m. At the end of Q1 2023, Lion Capital held majority stakes - over 50% of the issuer's share capital - in 13 companies, with a total value of RON 1,132.43m, representing 40% of stock portfolio value.
ASSETS UNDER MANAGEMENT as of March 31, 2023
breakdown on classes (weight on total assets)
-
■ listed shares value 2,361,89 RONm (31,12,2022: 2,336,59 RONm)
■ unlisted shares value 492,47 RONm (31,12,2022: 492,84 RONm)
■ unlisted fund units value 373,64 RONm (31,12,2022: 362,94 RONm)
■ corporate bonds value 37,58 RONm (31,12,2022: 37,58 RONm)
■ bank deposits + cash available value 26,61 RONm (31,12,2022: 26,61 RONm)
■ receivables and other assets value 142,37 RONm (31,12,2022: 144,62 RONm)
Note: values calculated as of March 31, 2023 (the outer ring), and December 31, 2022 (the inner ring), as per ASF Regulations no, 9/2014, no, 10/2015, and no, 7/2020
■ banking - financial
stakes in 12 companies, worth 1,265,96 RONm (31,12,2022: 13 companies, worth 1,322 RONm)
■ commerce – real-estate
stakes in 12 companies, worth 667,34 RONm (31,12,2022: 12 companies, worth 667,07 RONm)
stakes in 2 companies, worth 240,31 RONm (31,12,2022: 2 companies, worth 231,07 RONm)
■ energy - utilities
stakes in 5 companies, worth 206,02 RONm (31,12,2022: 6 companies, worth 187,75 RONm)
■ cardboard and paper
stakes in 4 companies, worth 153,21 RONm (31,12,2022: 4 companies, worth 139,47 RONm)
■ hospitality (hotels and restaurants) stakes in 4 companies, worth 175,77 RONm (31,12,2022: 4 companies, worth 133,53 RONm)
■ other industries and activities stakes in 46 companies, worth 145,75 RONm (31,12,2022: 52 companies, worth 148,55 RONm)
Note: percentages in the chart represent the stake of the category in the stock portfolio; values calculated as of March 31, 2023 (the outer ring), and December 31, 2022 (the inner ring), as per ASF Regulations no, 9/2014, no, 10/2015 and no, 7/2020
stakes in 27 companies, worth 1,131,49 RONm (31,12,2022: 29 companies, worth 1,173,25 RONm)
■ 5-33%
stakes in 42 companies, worth 357,97 RONm (31,12,2022: 47 companies, worth 314,33 RONm)
■ 33-50% stakes in 3 companies, worth 232,47 RONm (31,12,2022: 3 companies, worth 223,05 RONm)
■ over 50%
majority stakes in 13 companies, worth 1,132,43 RONm (31,12,2022: 13 companies, worth 1,118,81 RONm)
Note: percentages in the chart represent the stake of the category in the stock portfolio; values calculated as of March 31, 2023 (the outer ring), and December 31, 2022 (the inner ring), as per ASF Regulations no, 9/2014, no, 10/2015, and no, 7/2020
18% 82% 17% 83%
85 companies 2,854 RONm
2,365,19 RONm (31,12,2022: 2,313,10 RONm) value of shareholdings in 83 companies (31,12,2022: 90)
■ foreign markets
489,16 RONm (31,12,2022: 516,23 RONm) value of shareholdings in 2 companies (31,12,2022: 2): Austria (1 company – Erste Bank), Cyprus (1 company – SIF Imobiliare)
Note: percentages in the chart represent the stake of the category in the stock portfolio; values calculated as of March 31, 2023 (the outer ring), and December 31, 2022 (the inner ring), as per ASF Regulations no, 9/2014, no, 10/2015, and no, 7/2020
| Company (symbol) | Sector | Stake | Value of holding* [RON] |
% of NAV | |
|---|---|---|---|---|---|
| 1 | Banca Transilvania (TLV) | banking - financial | 4,78% | 659.165.891 | 19.95% |
| 2 | SIF Imobiliare Plc (SIFI) | real estate | 99,99% | 368.402.807 | 11.15% |
| 3 | SIF1 IMGB | real estate | 99,92% | 244.084.459 | 7.39% |
| 4 | Biofarm (BIO) | pharmaceuticals | 36,75% | 232.466.009 | 7.04% |
| 5 | SIF Muntenia (SIF4) | financial (AIF) | 17,93% | 164.576.383 | 4.98% |
| 6 | OMV Petrom (SNP) | energy – utilities | 0,57% | 163.514.895 | 4.95% |
| 7 | BRD Groupe Société Générale (BRD) | banking – financial | 1,95% | 161.752.104 | 4.90% |
| 8 | Vrancart (VNC) | cardboard and paper | 75,50% | 152.646.908 | 4.62% |
| 9 | Erste Group Bank AG (EBS) | banking – financial | 0,19% | 120.758.040 | 3.65% |
| 10 | SAI Muntenia Invest | financial (AIFM) | 99,98% | 88.902.216 | 2.69% |
| TOTAL | 2,356,269,712 | 71.31% |
* calculated pursuant to ASF Reg, no, 9/2014, no, 10/2015, no, 2/2018
| Total number of issued shares (March 31, 2023) | 507,510,056 |
|---|---|
| Outstanding shares (March 31, 2023) | 506,520,056 |
| Nominal value | RON 0.1000 / share |
| Type of shares | common, ordinary, registered, dematerialized, indivisible |
| Trading market | Regulated spot market of Bucharest Stock Exchange (BVB or BSE), Premium category, listed since November 1, 1999 |
| Trading venue (MIC) | XBSE |
| BVB (BSE) symbol (ticker) | SIF1 |
| Bloomberg BBGID | BBG000BMN388 (SIF1:RO) |
| ISIN | ROSIFAACNOR2 |
| Reuters | SIF1.BX |
| Part of indices | BVB (BSE) indices: BET-FI BET-XT BET-XT-TR BET-BK BET-XT-TRN |
SIF1 shares on Bucharest Stock Exchange (BVB/BSE)
The liquidity of the SIF1 stock was much lower compared to the similar period of 2022, in Q1 2023 a total of 1,397,107 shares were traded, representing 0.275% of the total issued securities, the total value of traded shares being of RON 3,423,501.
A transaction with 2.18 million shares worth of RON 5.46m was carried out on the "DEAL" market.
Between February 16 and March 1, in the Public Tender Offer 1.87 million SIF1 shares were purchased, with a total value of RON 4.712m.
Of the 63 trading days, 28 days were with positive variations (maximum +3.31% on February 28) and 24 days with negative variations (minimum -2.8% on March 1).
The highest closing price the SIF1 share was traded during Q1 2023 was of RON 2.5000 per share, in the session of February 28, and the lowest closing price was of RON 2.3800 per share, in the session of January 13, the trading range between the highest and the lowest of the period being 5%. The average price of the period was of RON 2.4504 per share.
SIF1 share price advance was of 0.41% YtD, while of BET-BK index was 0.91%, and BET-FI index declined -1.38% in Q1 2023.
On March 31, 2023, the market capitalization for SIF1 was of RON 1,248.47m for the issued shares, while for the outstanding shares was of RON 1,246.04, calculated using the closing price.
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highlighted values for SIF1 price were recorded at the closing of trading day
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highlighted values were recorded at the closing of trading day
As of March 31, 2023, Lion Capital has 5,740,306 shareholders, according to the data reported by Depozitarul Central SA Bucharest, the company keeping the shareholders registry. Lion Capital holds 990,000 treasury shares, acquired under the public tender offer carried out between February 16 and March 1, 2023, based on the buyback programs approved by EGM Resolutions no. 3 of October 11, 2021, and no. 5 of April 28, 2022.
SHAREHOLDERS' STRUCTURE as pe holdings as of March 31, 2023
■ 40,24% Romanian individuals (5,738,043 shareholders)
■ 43,43% Romanian legal entities (112 shareholders)
■ 0,20% Lion Capital (0,99 m treasury stock) ■ 0,33% non-resident individuals (2,128 shareholders)
■ 15,80% non-resident legal entities (22 shareholders)
Lion Capital applies the Significant Risks Management Policy and Work Procedures on the identification, assessment, measurement and control of risks, documents approved by the company's Board of Directors.
The Board of Directors approves the Fund's appetite and risk tolerance limits, as well as the policies and procedures regarding the significant risks to which the Fund is or may be exposed, and together with the executive management makes sure of their application at the Lion Capital level by using techniques, tools, and appropriate mechanisms.
The assessment of the effectiveness of the risk management system adopted by Lion Capital is carried out by the Board of Directors at least every six months based on the risk reports, depending on the policies, procedures and controls carried out.
The permanent risk management function has a leading role in defining the risk policy, in monitoring and measuring risks, ensuring the permanent compliance of the risk level with the risk profile of the Company assumed by the Board of Directors. The person responsible for risk management has access to all relevant information and provides senior management with up-to-date data on which to take prompt remedial action, if necessary.
Mrs. Hodăjeu Adina Eleonora holds the position of Person responsible for risk management starting from March 9, 2018, no. ASF register: PFR13.2FARA/020053.
The fulfilment of the risk management function is periodically examined by the internal and external audit function.
The company's management structure, through the Board of Directors and the Audit Committee, approves and periodically reviews both the risk strategy and the significant risk management policy.
The significant risk management strategy is based on risk management objectives and monitors three parameters: risk appetite, risk profile and risk tolerance. The strategy of Lion Capital's Board of Directors is to assume a medium-level risk appetite.
This objective takes into account the fact that, in conditions of economic difficulties, the Fund will objectively accept a higher level of risk coming from the existing exposures of the portfolio but will take all necessary measures to reduce the risk appetite for new (future) exposures.
The objectives of the Risk Management office for the year 2023 have in mind both the identification of risk-generating situations in the activity associated with the administration of the Lion Capital portfolio and its secondary risks, as well as the assessment of risks with strict compliance with the regulations specific to the field of activity (both local and directives and European regulations) and the adequacy of work procedures to the new regulations regarding the activity of the AIFM/AIF.
The action plan for ensuring the continuity of the risk management activity for 2023 was approved by the Board of Directors in January 2023.
The risk appetite indicates the level of risk that the Fund is willing to accept, having two components: (i) for existing exposures and (ii) risk level arising from future exposures.
In June 2022, the Board of Directors approved maintaining the risk appetite at a medium level for the period July 2022 - July 2023.
The risk management policy is based on a system of limits used to monitor and control the significant risks, according to the risk profile and the approved investment strategy. At Fund's portfolio level, the
risk limits cover the following risks: market risk, liquidity risk, credit and counterparty risk and operational risks and other types of risk, these being evaluated through the risk profile.
The risk profile is assessed quarterly in the periodic risk reports, and it is monitored in relation to the objectives regarding the established risk level. Depending on the evolution of the risk profile in relation to these objectives, as well as the temporal dimension of a certain evolution (for example: the period in which the risk exceeds a certain level), the company can order measures to correct or control the risk factors. The risk profile includes the influence of the entire risk portfolio.
The Board of Directors approved in June 2022 maintaining the Company's global risk classification at MEDIUM level in the period July 2022 - July 2023 (until the next annual assessment), if, following periodic monitoring, no need to change it is found.
The significant financial risks to which Lion Capital is exposed as AIFRI are market risk comprising the subcategories price/position risk, interest rate risk, currency risk and concentration risk, liquidity risk, credit and counterparty risk, operational risk comprising subcategories: risk related to technical resources / IT systems, professional risk, model / process risk, risk associated with outsourced activities, and other risks comprising subcategories: reputational risk, strategic risk, regulatory risk, tax-related risk, business-environment related risk.
The Fund's exposure to each of the mentioned risks is presented in Note 4 of the Financial Statements.
The Fund is exposed to the risk that the fair value of the financial instruments held will fluctuate following the changes in market prices caused either by factors specific to the activity of issuers or by factors affecting all instruments traded on the market. The PROXI-85 portfolio risk, a benchmark for price risk at the level of the portfolio of traded stock portfolio, is analysed compared to the total risk of the BET-BK index as a forecast of volatilities.
The market value of PROXI-85 increased in Q1 2023 by approx. RON 56m (+2.82%) while the portfolio risk decreased compared to the end of 2022, VaR as a percentage of the PROXI-85 portfolio exposure remaining above the 10% level. On 31.03.2023 VaR for the PROXI-85 portfolio was 10.36% of the market value of RON 2,045m. Tracking-error, which indicates active management and represents the risk for the part of the PROXI-85 portfolio different from the BET-BK reference index, was of 6.10% and the Expected shortfall (Conditional VaR), which indicates the potential loss of the portfolio in extreme cases of exceeding the 99% confidence level, was of 12.82%, down from the data at 2022 year end.
With respect to interest-bearing financial instruments, the Company's policy is to invest in short-term financial instruments in general, thus partially reducing both the risk of fluctuation and the risk of maturity differences (the Company has no liabilities with maturities over 1 year).
The fund is subject to an exposure to changes in fair value or future cash flows due to fluctuations in the prevailing levels of market interest rates (ROBOR 3M and EURIBOR 3M). The portfolio of assets and debt instruments includes the bonds issued by Vrancart SA in RON and the loan granted to SIF SPV TWO in EURO (financial asset), the weight of these exposures in the total assets being of 4.51%. Both the bonds and the loan granted fall within the remaining maturity range of up to 5 years.
No derivative financial instruments were used for hedging against interest rate fluctuations.
The value of the exposure of the Fund's portfolio to currency risk (financial instruments and assets denominated in euros: shares, loan granted to the subsidiary, as well as monetary instruments: deposits and current accounts) represents a weight of 20.01% of total assets as of March 2023, the exposure limit to currency risk, established by the global risk profile for a medium-high currency risk appetite, being respected.
No derivative transactions on the exchange rate were made during the period presented.
The Fund's exposure diversification policy applies to the structure of the portfolio, to the structure of the business model, as well as to the structure of exposures to financial risks.
The first 3 sectors with important weights in the structure of total assets are the banking sector, investment management and the real estate sector and accumulate 65.57% of total assets. Exposure to the banking sector remains important, issuers from the banking sector and financial instruments issued (equity instruments, deposits, and current accounts) having a weight of 28.93% in TA as of 31.03.2023. Banks are the most exposed to systemic and contagion risk in crisis situations, a positive aspect of these holdings is the liquid nature of the investment.
Diversifying the investment allocation by increasing exposure to other sectors (with lower weights or sectors without exposure) remains an objective of the Fund to reduce portfolio concentration risk.
The Fund maintains a level of liquidity adequate to its underlying obligations, based on an assessment of the relative liquidity of the assets on the market, prudently considering the period required for liquidation and the price or value at which those assets can be liquidated, as well as their sensitivity to market risks or other market factors. In the risk management process, the liquidity of the financial instruments portfolio is analysed separately from the liquidity risk related to payment obligations.
The liquidity profile of the stock portfolio is largely influenced by the liquidity of the market on which they are quoted, only 12 companies in the portfolio, quoted on the BSE meeting the liquidity criteria for daily transactions.
The liquidity risk related to the Fund's payment obligations is low, as current liabilities can be immediately covered by the balance of current accounts and short-term deposits. The assessment of the net LCR indicator as of March 31, 2023, is 62.37 which indicates a higher value of assets compared to the value of current liabilities.
In order to limit / avoid liquidity risk, the Company will adopt a prudential policy on cash outflow.
The Fund is exposed to credit and counterparty risk as a result of investments made in bonds issued by companies, current accounts and bank deposits and other receivables. The credit risk is also reduced by placing the funds of the Fund in several banks, the placements being established at the first banking institutions in the system, with a rating similar or close to the country rating (BBB+ and BB+, confirmed by the rating agencies in December 2022).
Credit risk management is carried out by closely and constantly monitoring credit risk exposures so that the Fund does not suffer losses because of credit concentration in a certain sector or field of activity.
The evaluation of the counterparty's credit risk indicators according to the exposure to unlisted or unrated issuers, representing 4.51% of total assets, and according to the exposure to business sectors, representing 3.42% of total assets, reveals an expected loss of 2.1% of the exposure value.
No trades with derivative financial instruments (listed or OTC) were made, so the Fund is not subject to counterparty risk.
The Company's objective is to manage the operational risk in such a way as to limit financial losses, to not damage its reputation, to achieve its investment objective and to generate benefits for investors.
The risk limits for the operational risk subcategories (legal, professional, process / model and associated with outsourced activities) are established as a result of the risk indicator assessment (KRI), the appetite for operational risk being medium.
For the year 2023, based on the value of assets under management as of the last working day of the previous year, Lion Capital was classified by ASF in the medium risk category for the risks generated by IT systems. In March 2023, the internal assessment of operational risks generated by IT systems was carried out in accordance with ASF Norm no. 4/2018 for the year 2022.
During the reporting period, there were no operational risk incidents generated by IT systems, and no expenses associated with operational risks were recorded at the company level.
The Company makes sure that it takes appropriate measures to identify and assess the risks related to money laundering and terrorist financing, considering the risk factors, including those relating to customers, countries or geographical areas, products, services, transactions, or distribution channels, in proportion to the nature and size of its activity. The assessment of ML / TF risks associated with the clientele of SIF Banat-Crișana is performed both at the initiation of a business relationship and after the transaction, if during it one of the risk factors changes.
The ML/TF risk assessment for the current reporting period indicated that all business partners have a low inherent risk (score between 0-5 points). Simplified customer due diligence and normal business relationship monitoring measures have been applied. The total residual risk remaining after internal controls have been applied to inherent risk leads to the conclusion that Lion Capital's exposure to ML/FT risk is low and within the appetite and limits approved by the Board of Directors.
The internal assessment of other types of risks not included in the main categories (market, credit, liquidity, operational) consists in their qualitative assessment depending on the impact it could cause on the income, expenses, and value of Fund's assets.
Lion Capital adopts the necessary measures for the sustainability and development of the company in the conditions existing on the financial market, by monitoring cash flows and the adequacy of investment policies.
Avoiding risks and mitigating their effects are ensured by the Fund through an investment policy that complies with the prudential rules imposed by the applicable legal provisions and regulations in force.
During the reporting period, there were no violations of the risk limits at the level of the global risk profile.
Through risk management, both through prior verification of investments and through ex-post monitoring, the Fund ensures that the portfolio management is within the appropriate risk parameters.
Internal mechanisms to ensure monitoring of exposure limits
Lion Capital has implemented an internal regulatory framework that defines the processes of monitoring, verification, and reporting of investment limits according to the provisions of art. 35 par. (2) of AIF Law 243/2019, approved by the Board of Directors.
The verification and reporting of compliance with the investment limits is performed monthly, together with the calculation and reporting of the statement of the Fund's assets and liabilities, to the senior management and the operational offices. At the request of the depositary bank BCR, this is also sent to them for double verification.
The person responsible for risk management analyses the investment proposals prepared by the Investment Managers to ensure that the risks associated with each investment position and their overall effect on the portfolio correspond to the investment objectives and risk profile approved by the Board.
The risk opinion, in which the investment proposals are analysed and are verified both the compliance with the holding limits specified by art. 35 par. (2) of Law 243/2019 as well as the investment risk limits defined by the global risk profile, together with the Investment Report constitute the documents based on which the investments are approved according to the Decision and Signature Competencies within the Company.
Exposures higher than 10% on instruments issued by the same issuer are on Banca Transilvania SA (largest weight TA of 19.03%) and SIF Imobiliare PLC (weight of 10.64% in TA). These holdings together represent an exposure of 29.67% of the TA, without exceeding the upper limit of 80%.
On 31.03.2023 Lion Capital holds 9,878,329 shares issued by Depozitarul Central, a stake of 3.9057% of the share capital of the issuer, and 142,500 shares issued by the Central Counterparty CCP.RO, a stake of 1.7857% in the share capital of the issuer.
As of 31.03.2023, Lion Capital holds 410,637 shares issued by the market operator Bucharest Stock Exchange, a stake of 5.1016% in the share capital of the issuer.
By the Simplified Prospectus and the Rules of the Fund, Lion Capital assumed not using substantially (continuously and consistently) the leverage effect, defined as any method by which the AIFM increases the exposure of an AIF it manages either by loan of cash or securities, or by positions of derivative financial instruments or by any other means, in the process of portfolio management, respectively the methods used to increase the portfolio exposure will comply with the average risk profile decided.
By the Risk Management Policy and the Authorization Documents as AIFRI, Lion Capital ensures that its overall exposure to derivative financial instruments in the portfolio under management does not exceed the total value of its assets, will not use financing operations through financial instruments and will not invest in Total Return Swap instruments as defined by Regulation (EU) no. 2365/2015. Lion Capital cannot make short sales, defined according to the provisions of Regulation (EU) no. 236/2012 aspects of credit risk swaps, other than for the purpose of hedging (risks).
During Q1 2023, Lion Capital has not used leverage for its portfolio under management, not having the tools to generate such an effect. As of March 31, 2023, the leverage indicator by the gross method had the value of 99.87%, and by the commitment method 100%.
According to Regulation (EU) 2019/2088 on sustainability‐related disclosures in the financial services sector (Sustainable Finance Disclosure Regulation or SFDR), financial market participants are required to publish information on the integration of ESG risks and opportunities in their investment decisions.
Awareness and application of ESG (environmental, social, governance) criteria in investment and business become essential in the context of risks caused by climate change, adopting, and implementing ESG criteria in investment and business could help minimize these risks and improve long-term performance.
The Fund's strategy regarding the integration of sustainability risk in the investment decision-making process focuses on the objectives of sustainable development, the financial instruments of the issuers for which there is exposure, or the investment is intended being subject to the sustainability testing process based on ESG criteria.
By investing in companies that also perform well in ESG, the Fund will be able to benefit from longterm competitive advantages, reduced risks of decline and strengthened reputation. Good corporate governance enables higher profits, lower expenses, and more innovation. It also reduces volatility by reducing financial risks and lowering funding costs. Companies that adhere to the principles of sustainable development and social and environmental standards will be able to provide high-quality products and services, which in turn will increase customer loyalty and employee motivation.
The fund continuously analyses and evaluates the issuers in the portfolio on ESG criteria based on available ESG scores and their non-financial reports.
It will also be continued the qualitative assessment of the sustainability risk at the organizational level, based on the analysis of the impact of the asset management activity on the environment, and the improvement of measures for the management of social aspects, diversity, and sustainable governance.
On January 5, 2023, the Company informed the shareholders upon the receiving on January 4, 2023, of Notifications of change in ownership threshold of 5% in SIF Banat-Crișana from the shareholder SIF Muntenia S.A. (5.0734%) and the shareholder Opus – Chartered Issuances S.A. (5,07717%).
Gathered in the meeting held on January 17, 2023, the Board of Directors convened the Extraordinary General Meeting of Shareholders (EGMA) of SIF Banat-Crișana for February 23 (24) 2023. The EGM, held on February 23, 2023, at the first call, approved the change of the company's name from "Societatea de Investiții Financiare Banat-Crișana S.A." to "Lion Capital S.A.", as well as the corresponding amendment of art. 1 paragraph (1) of the company's Articles of Association, which will have the following content: The name of the company is "Lion Capital S.A.". The new name will be used in all documents, invoices, announcements, publications, and other such documents issued by the company only starting from the date of authorization/approval by the Financial Supervisory Authority (A.S.F.) of the new name.
At the same time, the shareholders also approved other amendments and additions to the company's Articles of Association, concerning:
the introduction of an express clause, according to which "abstentions" will be considered as votes cast, with the consequence of taking them into account when establishing the majority required to approve the decisions of the general meetings of shareholders;
elimination of the reference to the provisions of Law no. 24/2017 (which regulated the definition of "intermediaries") and the replacement with a general reference to the definition of intermediaries, provided by the applicable legal framework;
the express regulation of the prerogative of the (executive) directors, to whom management powers have been delegated, to represent the Company in relations with third parties, within the limits of the attributions and powers provided by the internal regulations of the Company and the powers of decision and signature, approved by the Board of Directors administrators, in the absence of the Chairman-CEO and of the Vice-Chairman.
The company has filed with ASF the documentation for authorizing the amendments of the Articles of Association in accordance with Resolution no. 2/23.02.2023 and Resolution no. 3/23.02.2023 adopted by the EGM of February 23, 2023.
On January 20, 2023, the Company filed with the Financial Supervisory Authority the Public Tender Offer Document for the purchase of 1,870,000 own shares, together with the related documentation. SSIF SWISS CAPITAL S.A. was appointed as an intermediary in the Public Tender Offer. The offer, carried out between February 16 and March 1, 2023, intended the purchase of 1.87 million SIF1 shares, at a price of RON 2.52/share.
The public offer fulfilled the EGM resolutions no. 3 of October 11, 2021, and no. 5 of April 28, 2022, which approved the running of a buyback program ("Program 4") for 880,000 shares, respectively a buyback program ("Program 6"), for 990,000 shares, for their distribution free of charge to members of the company's management.
The results of the public tender offer were published on March 7, 2023, informing investors that 7,673,570 shares representing 1.5120% of the issuer's share capital (oversubscription more than four times) were submitted within the offer, 1,870,000 shares being repurchased, the total amount paid being of RON 4,712,400. Following the closing of the offer, SIF Banat-Crișana was holding 1,870,000 own shares, representing 0.3685% of its share capital.
On February 28, 2023, the Company published the preliminary financial results for the year ended December 31, 2022, prepared in accordance with IFRS, through communication in the market (BSE) and posting on the Company's website, at www.lion-capital.ro.
As per the provisions of ASF Regulation no. 10/2015 (art. 19) and Regulation (EU) 231/2013 (art. 69- 70), on February 28, 2023, Lion Capital informed the investors upon maintaining the evaluation policies and methods used for the measurement of the financial assets in the company's portfolio presented on the company's website, at www.lion-capital.ro, in the section Investments › Net Asset › Net asset value calculation methodology.
The Financial Supervisory Authority communicated to the company, on March 1, 2023, the Decision 199/01.03.2023, by which it fined Bogdan-Alexandru Drăgoi, Chairman – CEO of SIF Banat-Crișana, because the Company had not notified the issuer about exceeding, in March 2020, the threshold of 5% of voting rights together with SIF Muntenia on Bucharest Stock Exchange (BVB). ASF considers that the two funds are presumed to have acted in concert. The fine was paid within the stipulated time.
Disclosure document concerning the shares offered to the members of the management structure
On March 13, 2023, the Company informed the shareholders that, based on the resolutions adopted by the Extraordinary General Meeting of the Shareholders of the Company of April 28, 2022, as follows:
EGM Resolution no. 5/28.04.2022 approving the execution of a buyback program for 990,000 shares (Program 6), to be distributed free of charge to members of Company's management (administrators, directors), in order to build their loyalty as well and to reward their activity within the Company;
EGM Resolution no. 6/28.04.2022, approving: (i) the use of shares purchased under the Buyback Program 6 for their distribution free of charge to members of the company's management (administrators, directors), in a share-based payment plan of a "Stock Option Plan" type; (ii) the empowerment of the Board of Directors of the Company to take all necessary measures and to fulfil all the formalities required for the approval and implementation of the share-based payment plan of a "Stock Option Plan" type.
Company's Board of Directors approved on March 8, 2023, the offering free of charge to the members of the management structure (administrators, directors) of 990,000 shares in a share-based payment plan of a "Stock Option Plan" type.
The vesting (transfer of shares) will be made when the conditions in the "Stock Option Plan" are met and the option is exercised by each beneficiary, after a term of 12 months has passed since the signing of the payment agreements.
The disclosure document concerning the shares offered or allotted to members of SIF Banat-Crișana management, prepared as per EU Regulation no. 1129/2017 and ASF Regulation no. 5/2018, is available on company's website, www.sif1.ro, in the Investor Relations › Continuous Disclosure › 2023.
On March 14, 2023, the Company informed the shareholders that by the Current Report of January 25, 2022, the public was informed upon the approval by the Board of Directors of the "Share-based payment plan" (Stock Option Plan), by which 880,000 SIF1 shares were offered to the members of Company's management, as per the resolutions no. 3 and no. 4 adopted by the Extraordinary General Meeting of Shareholders on October 11, 2021.
At the same time, with the same current report, it was published the "Disclosure document concerning the shares offered or allotted to members of SIF Banat-Crișana management" prepared as per Annex no. 4 to Regulation no. 5/2018.
The Company informed the shareholders that upon completing the term of 12 months from the signing of the share-based payment agreements, the members of the management structure exercised their right to receive a number of 880,000 SIF1 shares, representing 0.1734% of the current share capital.
On March 13, 2022, Depozitarul Central (Central Depository) carried out the direct transfer of shares in accordance with the regulations in force. The information provided in art. 19 of Regulation (EU) 596/2014 EU are available on company's website in the Investor Relation section.
As there were no changes in the "Disclosure document concerning the shares offered or allotted" initially published, the said current report represented the "Disclosure document concerning the allotted shares", within the meaning of the provisions of the ASF Regulation no. 5/2018.
Authorization for the change of company name to Lion Capital SA and of Articles of Association On March 17, 2023, SIF Banat-Crișana received the Authorization no. 23/16.03.2023 issued by the Financial Supervisory Authority authorizing the changes occurred in the Company's Articles of Association, as per Resolutions no. 2 and no. 3 of the Extraordinary General Meeting of SIF Banat-Crișana Shareholders of 23.02.2023, including those regarding the change of company name from SIF Banat-Crișana SA to LION CAPITAL SA.
The company filed with the Trade Register Office attached to the Tribunal of Arad the application for the registration in the Trade Register of the mentions regarding the change of the company's name and the updated constitutive act. The Trade Register Office attached to the Tribunal of Arad released, on March 24, 2023, the Certificate of Recorded Amendments issued on the basis of Decision no. 3610 dated March 23, 2023, as well as the Registration Certificate Series B no. 4692143, by which it was decided the registration in the Trade Register of the amendments regarding the change of the corporate name of the company and the amendments to the Articles of Association.
Given that, as per the provisions of art. 34 of the ASF Regulation no. 7/2020 on the authorization and operation of alternative investment funds, the amendments made to the Company's Articles of Association enter into force after their authorization by ASF and after their registration at the Trade Register, the Company informed the shareholders and investors that, from the date of March 24, 2023, the date of completion of the mention and registration formalities with the Trade Register, the change of the Company's name from "Societatea de Investiții Financiare Banat-Crișana S.A." to "Lion Capital S.A.", as well as the other amendments to the Company's Articles of Association come into force.
Starting from March 24, 2023, the new corporate name - Lion Capital S.A. - is used in all documents originating from the company, including those used in the general meetings of shareholders of April 27, 2023.
The Convening of the Ordinary and the Extraordinary General Meeting of Shareholders of April 27 (28), 2023
The Board of Directors of the Company, gathered in the meeting of March 23, 2023, convened, pursuant to art. 117 of Law no. 31/1990, the ordinary general meeting of shareholders ("OGM") for April 27 (28), 2023, 10:00 a.m. and the extraordinary general meeting of shareholders ("EGM"), for April 27 (28) 2023, 12:00, at the company headquarters in Arad, 35A Calea Victoriei.
Starting from March 27, 2023, all informative materials related to the topics included on the agenda and the draft resolutions subject to the approval of the general meeting, were made available to the shareholders, being published on the Company's website, at www.lion-capital.ro, in the Investor Relations section.
Lion Capital has prepared the financial statements as of March 31, 2023, pursuant to Rule no. 39/2015 for the approval of accounting regulations in accordance with the International Financial Reporting Standards applicable to entities authorised, regulated, and supervised by the Financial Supervisory Authority, operating in the Financial Instruments and Investments Sector.
The interim condensed financial statements as of March 31, 2023, are not audited, as there is no legal or statutory requirement.
The following present information the main elements of the financial position and results of the Company as of March 31, 2022:
Condensed standalone statement of financial position
| Standalone statement of financial position - extract | |||
|---|---|---|---|
| denominated in RON | 31/03/2023 | 31/12/2022 | |
| Cash and cash equivalents, bank deposits | 55,300,416 | 26,615,152 | |
| Financial assets at fair value through profit and loss (FVTPL) | 1,759,121,827 | 1,723,810,844 | |
| Financial assets at fair value through other comprehensive income (FVTOCI) | 1,624,964,308 | 1,624,523,020 | |
| Investment property and tangible assets (property, plant, and equipment) | 16,603,995 | 16,674,856 | |
| Other assets | 9,809,802 | 13,639,280 | |
| Total assets | 3,465,800,349 | 3,405,263,152 | |
| Liabilities | 158,786,744 | 162,409,967 | |
| Equity (own capital) | 3,307,013,605 | 3,242,853,185 | |
| Total liabilities | 3,465,800,349 | 3,405,263,152 |
Total assets value held as of March 31, 2023, was of RON 3,465.8m, 1.8% higher vs. the value of assets at the end of 2022.
The main patrimonial elements changed compared to the beginning of the period as follows:
Cash and cash equivalents are up vs. 2022-year end, following the sales made during the first three months of 2023.
Financial assets at fair value through profit and loss (FVTPL), amounting to RON 1,759.1m, with RON 35.3m higher vs. December 31, 2023, due to the effect of recording differences in fair value for fund units and unlisted companies – subsidiaries and associates (with active market) as of March 31, 2023.
Financial assets at fair value through other comprehensive income (FVTOCI), amounting to RON 1,624m, are at the level recorded on December 31, 2022, as an effect of the compensation of the favourable differences in the fair value of the portfolio of financial assets (quoted shares) recorded on March 31, 2023, with the exits of shares (sales) in the first 3 months of 2023.
The Other assets category decreased compared to the beginning of the period, mainly influenced by the reduction of the profit tax claim on March 31, 2023.
Liabilities present a slightly decrease, mainly because of the payment during the Q1 2023 of the current liabilities existing on December 31, 2022.
The volume of equity (own capital) increased vs. December 31, 2022, mainly on account of the favourable fair value differences related to the portfolio of securities, recorded both within the elements of gain/loss on investments and within other comprehensive income as of March 31, 2023.
Condensed statement of profit and loss and other comprehensive income
| Standalone statement of profit or loss and other comprehensive income - extract | ||
|---|---|---|
| denominated in RON | 31/03/2023 | 31/03/2022 |
| Income | ||
| Dividend income | - | 32,900,487 |
| Interest income | 2,963,194 | 829,784 |
| Other operating revenues | 76,733 | 7,573 |
| Gain / (Loss) on investment | ||
| Gain/(loss) from foreign exchange differences | 235,890 | (261,846) |
| Gain / (Loss) on financial assets at fair value through profit and loss | 33,744,676 | (63,686,667) |
| Expenses | ||
| Commissions expenses | (1,085,885) | (1,029,007) |
| Other operating expenses | (3,791,880) | (3,641,144) |
| Profit /(Loss) before tax | 32,142,729 | (34,880,820) |
| Income tax | (1,582) | (1,372,701) |
| Net Profit/(Loss) for the period | 32,141,147 | (36,253,521) |
| Other comprehensive income | 36,344,458 | (103,829,026) |
| Total comprehensive income for the period | 68,485,605 | (140,082,547) |
Progress of income with significant weight was as follows:
- No dividend income was recorded as of March 31, 2023
- Interest income is significantly higher vs. the same period of the previous year, their higher volume being due both to the higher level of the interest rate and as an effect of recording the interest due for the loan granted to a subsidiary.
Gain / (loss) on investment had the following progress:
The net result from exchange rate differences recorded as of March 31, 2021, is favourable, mainly related to cash in foreign currency held.
Gain / (Loss) on financial assets at fair value through profit and loss (FVTPL) is favourable, amounting to RON 33.7m, vs. a loss of RON 63.6m as of March 31, 2022. The net gain is the result of fair value measurement as of March 31, 2023, of listed shares (subsidiaries and associates) and of fund units.
Expenses as of March 31, 2023, are slightly higher vs. the corresponding period of 2022, as increases were recorded both in commission and operational expenses.
Net Profit as of March 31, 2023, amounting to RON 32.1m, is mainly the effect of result from the measurement at fair value of the abovementioned interests.
Total comprehensive income as of March 31, 2023, is positive, amounting to RON 68.5m, and it is the effect of recognizing in other comprehensive income of the fair value increase, vs. 2022-year end, of the portfolio of financial assets classified in FVTOCI (assets at fair value assets through other comprehensive income - mainly interests in the hospitality sector and extractive industry.
| Ratio | Calculation method | Result as of 31.03.2023 |
|---|---|---|
| 1. Current liquidity ratio 1) | Current assets/Current liabilities | 2.82 |
| 2. Debt to equity ratio 2) | Debt / Equity x 100 | not the case |
| Debt / Capital employed x 100 | not the case | |
| 3. Accounts receivables turnover 3) | Average clients' accounts / Turnover x 90 | 27 |
| 4. Non-current assets turnover 4) | Turnover / Non-current assets | 0.0109 |
Financial ratios as of March 31, 2023
1) Current liquidity ratio provides the guarantee of covering current liabilities from current assets. The acceptable recommended value is approximately 2, and the recorded value at the end of the first three months of 2023 was of 2.82. This is due to the high level of current assets as of March 31, 2023, as there were significant amounts of liquidity in bank accounts and deposits.
2) Debt to equity ratio indicates the effectiveness of the credit risk management, revealing potential financing or liquidity issues, with impact on fulfilling the assumed commitments. The Company had no loans as of March 31, 2023, and therefore this indicator is zero.
3) The accounts-receivable turnover indicates the effectiveness of the company in collecting its receivables, respectively the number of days until the debtors pay their debt to the company.
For the turnover, the company's total income as of March 31, 2023, was used.
Turnover ratio calculated as of March 31, 2023, was of 27 days.
4) Non-current assets turnover measures the efficiency of management of the non-current assets, by examining the value of the turnover (value of income and gains) generated by a certain portion of non-current assets. In determining the ratio, the gross value of financial assets was considered. As of March 31, 2023, this ratio has a value of 0.0109.
The Ordinary and the Extraordinary General Meeting of Lion Capital's Shareholders of April 27, 2023
The ordinary and the extraordinary general meeting of Lion Capital's shareholders were held on April 27, 2023, starting at 10:00 a.m. (Romanian time), and respectively at 12:00 p.m. (Romanian time), at the first call.
The ordinary general meeting of shareholders approved:
• the standalone financial statements for 2022 FY, based on the discussions and reports presented by the Board of Directors and the financial auditor, including the remuneration report of SIF Banat-Crișana for the year 2022, in accordance with the provisions of art. 107, par. (6) from Law no. 24/2017 republished, annex to the annual report of the Board of Directors;
• allocation of the net profit for 2022 FY, in the amount of RON 95,467,148, to Other reserves, as own financing sources;
• the consolidated financial statements prepared for the year ending on December 31, 2022, based on the discussions and reports presented by the Board of Directors and the financial auditor;
• the discharge of administrators for the activity carried out in 2022 FY;
• the income and expenses budget and the Activity Program for 2023 FY;
• the remuneration due to the members of the Board of Directors for 2023 FY, at the level established by the OGM Resolution of April 26, 2016;
• the general limits of all the additional remuneration of the members of the Board of Directors and the general limits of the directors' remuneration for 2023 FY at the level established by OGM Resolution no. 7 of April 27, 2020.
The extraordinary general meeting of shareholders approved the following main topics agenda:
The General Meeting of Shareholders shall empower the Board of Directors to buyback the shares of Lion Capital S.A. at the prices set by the Board of Directors, in accordance with the applicable legal regulations and within the limits approved by the general meeting of shareholders.
The Board of Directors elects a chairman and a vice-chairman from among its members. The Chairman of the Board of Directors will also perform the function of CEO (chief executive officer) of the company. The Vice-Chairman of the Board of Directors may also perform the function of Deputy General Director.
The Board of Directors delegates the management of the Company to the directors, at the same time determining their remuneration, within the general limits approved by the General Meeting of Shareholders. The directors of the company shall meet the minimum requirements regarding integrity, qualification and professional experience provided by the applicable regulations and legal provisions in force. The duties and powers of decision and signature, as well as the way of organizing the activities of the directors, are provided in the internal regulations of the Company, approved by the Board of Directors.
The Chairman-CEO or, in his/her absence, the vice-chairman, if he/she holds the position of deputy general director or, in the absence of the latter, the other directors to whom management has been delegated, represents the company in relations with third parties , within the limits of the duties and powers provided by the internal regulations of the Company and the powers of decision and signature, approved by the Board of Directors.
Besides its main characteristics, Program 7 will also include other requirements provided by law and which are not listed above. The acquisition of shares under Program 7 will be done through all market operations allowed by law, which may include public tender offers initiated by the Company, in accordance with the law. To implement the Program 7, the Board will be empowered to take all necessary measures and fulfil all formalities required, in compliance with the above-mentioned requirements.
• the use of the shares purchased under Buyback Program 7 for their distribution free of charge to members of the company's management (administrators, executive directors) in a sharebased payment plan of "Stock Option Plan" type, in compliance with applicable legislation. The Board of Directors of the company is empowered to take all necessary measures and to fulfil all the formalities required for the approval and implementation of the share-based payment plan of "Stock Option Plan" type.
The full version of the Resolutions adopted by the OGM and RGM of April 27, 2023, is available for consultation on the Company's website, at www.lion-capital.ro, in the Investor Relations section.
By Authorization no. 23/16.03.2023, the Financial Supervisory Authority authorized the changes made to the Company's Articles of Association, in accordance with EGM Resolution no. 2 of February 23, 2023, regarding the change of the corporate name of the company from S.I.F. Banat-Crisana S.A. to Lion Capital S.A., as well as the corresponding amendment to the articles of association.
The fund has carried out all the operations necessary to change the corporate name, both at the administrative, fiscal, and capital market institutions, as well as in the relationship with partners and collaborators.
The new corporate name was registered with the Trade Register Office attached to the Tribunal of Arad through Certificate of recorded amendments no. 8861/20.03.2023 issued on March 24, 2023.
From March 30, 2023, Depozitarul Central SA and the Bucharest Stock Exchange updated the new corporate name in the records under their management.
On May 15, 2023, there will be a ticker change / settlement symbol change from the old stock symbol "SIF1" to the stock symbol "LION". The event will be highlighted by the official opening of the stock exchange session by representatives of BVB, Lion Capital and other guests, thus celebrating a new stage in the existence of the Fund.
The quarterly report prepared as of March 31, 2023, was approved by the Board of Directors of Lion Capital in the meeting held on May 12, 2023.
Bogdan-Alexandru DRĂGOI Chairman and CEO
prepared pursuant to Rule no. 39/2015 for the approval of accounting regulations in accordance with the International Financial Reporting Standards applicable to entities authorised, regulated, and supervised by the Financial Supervisory Authority, operating in the Financial Instruments and Investments Sector
FREE TRANSLATION from Romanian, which is the official and binding version
| Condensed statement of profit and loss and other comprehensive income | 1 |
|---|---|
| Condensed statement of financial position | 2 |
| Condensed statement of changes in equity | 3 – 4 |
| Condensed cash flow statement | 5 |
| Selected explanatory notes to the condensed financial statements | 6 – 27 |
| Denominated in RON | Note | March 31, 2023 | March 31, 2022 |
|---|---|---|---|
| Income | |||
| Dividend income | 5 | - | 32,900,487 |
| Interest income (assets at amortized cost, assets at FVTOCI) | 6 | 62,830 | 128,688 |
| Interest income (assets at FVTPL) | 6 | 2,900,364 | 701,096 |
| Other operating revenues | 76,733 | 7,573 | |
| Gain/(Loss) on investment | |||
| Gain/(Loss) on investment property | - | ||
| Gain/(Loss) on foreign exchange differences | 235,890 | (261,846) | |
| Gain/(Loss) on financial assets at FVTPL | 7 | 33,744,676 | (63,686,667) |
| Expenses | |||
| Commissions expenses | 8 | (1,085,885) | (1,029,007) |
| Other operating expenses | 9 | (3,791,880) | (3,641,144) |
| Profit/(Loss) before tax | 32,142,729 | (34,880,820) | |
| Income tax | 11 | (1,582) | (1,372,701) |
| Net profit/(loss) for the period | 32,141,147 | (36,253,521) | |
| Other comprehensive income | |||
| Items that are or could be transferred to profit and loss | |||
| Amounts that could be transferred to profit and loss (debt instruments) | - | (5,692) | |
| Items that are or could be transferred to retained earnings | |||
| Change of fair value related to financial assets measured through OCI | 39,890,451 | (123,762,020) | |
| Effect of income tax related to them | (3,545,993) | 19,938,686 | |
| Other comprehensive income | 36,344,458 | (103,829,026) | |
| Total comprehensive income for the period | 68,485,605 | (140,082,547) | |
| Earnings per share | |||
| Basic | 0.0634 | (0.0714) | |
| Diluted | 0.0634 | (0.0714) |
The condensed interim financial statements were approved by the Board of Directors on May 12, 2023, and were signed on its behalf by:
| Denominated in RON | Note | March 31, 2023 | December 31, 2022 |
|---|---|---|---|
| Assets | 11 | ||
| Cash and cash equivalents | 14 | 55,300,416 | 26,615,152 |
| Other financial assets Other assets |
9,077,892 317,437 |
12,834,480 328,155 |
|
| Financial assets at fair value through profit and loss | 12 | 1,759,121,827 | 1,723,810,844 |
| Financial assets at fair value through other comprehensive income (shares) | 13 | 1,624,964,308 | 1,624,523,020 |
| 414,474 | |||
| Assets representing rights to use the underlying assets under leasing contract | 12,963,376 | 476,645 12,963,376 |
|
| Investment property | 15 | 3,640,619 | 3,711,480 |
| Tangible assets (items of property, plant, and equipment) | |||
| Total assets | 3,465,800,349 | 3,405,263,152 | |
| Liabilities | |||
| Payable dividends | 9,992,979 | 10,042,310 | |
| Other financial liabilities | 16 | 12,125,383 | 15,038,374 |
| Other deferred liabilities and revenues | 701,345 | 251,682 | |
| Liabilities on leasing contract | 463,992 | 530,880 | |
| Liability on deferred income tax | 17 | 135,503,045 | 136,546,721 |
| Total liabilities | 158,786,744 | 162,409,967 | |
| Equity (own capital) | |||
| Share capital | 18 | 50,751,006 | 50,751,006 |
| Treasury shares | 18 | (2,494,800) | - |
| Losses from the repurchase of own shares | (31,973) | - | |
| Benefits granted in equity instruments | 202,125 | 2,000,537 | |
| Other reserves | 18 | 1,604,099,887 | 1,604,099,887 |
| Reserves from the revaluation of tangible assets | 1,176,569 | 1,176,569 | |
| Legal reserves | 18 | 10,150,201 | 10,150,201 |
| Reserves from revaluation of financial assets designated at FVTOCI | 13, 18 | 758,970,814 | 741,827,359 |
| Retained earnings | 18 | 884,189,776 | 832,847,626 |
| Total equity (own capital) | 3,307,013,605 | 3,242,853,185 | |
| Total liabilities and equity | 3,465,800,349 | 3,405,263,152 | |
The condensed interim financial statements were approved by the Board of Directors on May 12, 2023, and were signed on its behalf by:
| Denominated in RON | Share capital |
Treasury shares |
Losses from the repurchase of own shares |
Legal reserves |
Reserves from the revaluation of financial assets at fair value through other comprehensive income |
Reserves from revaluation of tangible assets |
Benefits granted in equity instruments |
Other reserves |
Retained earnings |
Total |
|---|---|---|---|---|---|---|---|---|---|---|
| Balance on January 1, 2023 | 50,751,006 | - | - | 10,150,201 | 741,827,359 | 1,176,569 | 2,000,537 | 1,604,099,887 | 832,847,626 | 3,242,853,185 |
| Profit/(Loss) for the period Reserve from revaluation of |
- | - | - | - | - | - | - | - | 32,141,147 | 32,141,147 |
| financial assets transferred to profit and loss |
- | - | - | - | - | - | - | - | - | - |
| Reserve from revaluation of financial assets transferred to retained earnings |
- | - | - | - | (24,025,895) | - | - | - | 24,025,895 | - |
| Change in reserve Revaluation of tangible assets |
- - |
- - |
- - |
- - |
39,890,451 - |
- - |
- - |
- - |
- | 39,890,451 - |
| Related deferred tax | - | - | - | - | 1,278,899 | - | - | - | (4,824,892) | (3,545,993) |
| Total comprehensive income for the period |
- | - | - | - | 17,143,455 | - | - | - | 51,342,150 | 68,485,605 |
| Other reserves – own sources |
- | - | - | - | - | - | - | - | - | - |
| Change of granted benefits | - | 2,217,600 | 28,420 | - | - | - | (1,798,412) | - | - | 447,608 |
| Repurchase own shares | - | (4,712,400) | (60,393) | - | - | - | - | - | - | (4,772,793) |
| Total transactions with shareholders recognized directly in equity |
- | (2,494,800) | (31,973) | - | - | - | (1,798,412) | - | - | (4,325,185) |
| Balance on March 31, 2023 |
50,751,006 | (2,494,800) | (31,973) | 10,150,201 | 758,970,814 | 1,176,569 | 202,125 | 1,604,099,887 | 884,189,776 | 3,307,013,605 |
The condensed interim financial statements were approved by the Board of Directors on May 12, 2023, and were signed on its behalf by:
| Denominated in RON | Share capital | Treasury shares |
Losses from the repurchase of own shares |
Legal reserves |
Reserves from the revaluation of financial assets at fair value through other comprehensive income |
Reserves from revaluation of tangible assets |
Benefits granted in equity instruments |
Other reserves |
Accumulated profit |
Total |
|---|---|---|---|---|---|---|---|---|---|---|
| Balance on January 1, 2022 | 51.542.236 | (21.363.229) | (330.998) | 10.308.447 | 984.425.325 | 1.176.569 | - | 1.249.578.037 | 1.140.789.898 | 3.416.126.285 |
| Profit/(Loss) for the period Reserve from revaluation of financial assets transferred to profit and loss Reserve from revaluation of |
- - |
- - |
- - |
(36.253.521) | (36.253.521) | |||||
| financial assets transferred to retained earnings |
- | - | - | (1.546.459) | - | - | - | 1.546.459 | - | |
| Change in reserve | - | - | - | (123.768.796) | - | - | - | - | (123.768.796) | |
| Revaluation of tangible assets | - | - | - | - | - | - | - | - | - | |
| Related deferred tax | - | - | - | 20.086.900 | - | - | - | (147.130) | 19.939.770 | |
| Total comprehensive income | ||||||||||
| for the period | - | - | - | (105.228.355) | - | - | - | (34.854.192) | (140.082.547) | |
| Other reserves – own sources |
- | - | - | - | - | - | - | - | - | - |
| Payable dividends for 2020 | - | - | - | - | - | - | - | - | - | - |
| Lapsed dividends | - | - | - | - | - | - | - | - | - | - |
| Change of granted benefits Cancellation of treasury shares |
- - |
- - |
- - |
- - |
- - |
363.734 | 363.734 | |||
| Total transactions with shareholders recognized directly in equity |
- | - | - | - | - | 363.734 | - | - | 363.734 | |
| Balance on March 31, 2022 |
51.542.236 | (21.363.229) | (330.998) | 10.308.447 | 879.196.970 | 1.176.569 | 363.734 | 1.249.578.037 | 1.105.935.706 | 3.276.407.472 |
The condensed interim financial statements were approved by the Board of Directors on May 12, 2023, and were signed on its behalf by:
| Denominated in RON | Note | March 31, 2023 | March 31, 2022 |
|---|---|---|---|
| Operating activities | |||
| Net profit/(Loss) for the period | 32,141,147 | (36,253,521) | |
| Adjustments for: | |||
| Depreciation of tangible and intangible assets | 138,729 | 135,392 | |
| (Gain)/Loss from financial assets at fair value through profit and loss | 7 | (33,744,676) | 63,686,667 |
| Dividend income | 5 | - | (32,900,487) |
| Interest income | 6 | (2,963,194) | (829,784) |
| Expenses on interest on leasing contract | 6,918 | 10,701 | |
| Expenses/(Income) on foreign exchange differences financial, assets and | 43,576 | 9,150 | |
| financial liabilities, other expenses | |||
| Benefits granted in equity instruments | 357,592 | 363,734 | |
| Income tax | 10 | 1,582 | 1,372,701 |
| Changes in operating assets and liabilities | |||
| Change in other assets (claims, etc.) | 55,626 | 33,185 | |
| Change in other financial liabilities | (2,916,769) | 3,380,188 | |
| Income tax paid | - | - | |
| Net cash used in operating activities | (6,879,469) | (992,391) | |
| Investment activities Payments for acquisition of financial assets measured at FVTOCI (shares, bonds) |
|||
| Proceeds from sales of financial assets measured at FVTOCI (shares, bonds) | 13 13 |
- 39,449,163 |
(215,911,243) 2,635,465 |
| (Placements) / Proceeds from term deposits greater than three months | - | 51,136,139 | |
| Proceeds from sale/repurchase of assets at FVTPL (shares, fund units, bonds) | |||
| Payments for purchase of assets at FVTPL (shares, fund units, bonds) | - | (378,149) | |
| Proceeds from sale of tangible assets and investment property | - | ||
| Payments for purchases of tangible assets | - | (3,091) | |
| Dividends collected | - | 318 | |
| Interest collected | 1,010,866 | 470,702 | |
| Net cash from investment activities | 40,460,029 | (162,049,858) | |
| Financing activities | |||
| Payments related to leasing | (73,505) | (73,991) | |
| Dividends paid | (49,331) | - | |
| Repurchase own shares | (4,772,460) | - | |
| Net cash used in financing activities | (4,895,296) | (73,991) | |
| Net increase / (Decrease) in cash and cash equivalents | 28,685,264 | (163,116,240) | |
| Cash and cash equivalents on January 1 | 26,615,152 | 260,126,530 | |
| Cash and cash equivalents at the end of the period | 55,300,416 | 97,010,291 |
The condensed interim financial statements were approved by the Board of Directors on May XX, 2023, and were signed on its behalf by:
Lion Capital ("the Company") was established based on Law no. 133/1996 by the reorganization and transformation of Fondul Proprietății Private (Private Ownership Fund) Banat-Crișana and it is a joint stock company operating under Law 31/1990. The company is established as a self-managed investment company, authorized by the Financial Supervisory Authority as an Alternative Investment Fund Manager (AIFM) - Authorization no. 78 / 09.03.2018, classified in accordance with the provisions of Law no. 243/2019 as a closed, diversified alternative investment fund, addressed to retail investors (AIFRI) (Ro: FIAIR). The Financial Supervisory Authority issued the Authorization no. 130/01.07.2021 authorizing SIF Banat-Crișana as Alternative Investment Fund addressed to Retail Investors (AIFRI).
The company changed its corporate name from Societatea de Investiții Financiare Banat-Crișana S.A. to Lion Capital S.A. starting with March 24, 2023.
The Company also prepares annual and half-yearly consolidated financial statements, as final parentcompany for the entities in the Group.
Lion Capital is headquartered in Arad, 35A Calea Victoriei, Arad County, postal code 310158, tel.: +40257 304 438, fax: +40257 250 165. The registration number in the Trade Register Office is: J02/1898/1992, and the tax identification number is: RO 2761040.
The main activity of the company:
The Company's shares are listed on the Bucharest Stock Exchange since November 1st, 1999, and are traded on the regulated market, Premium category, with the stock symbol SIF1. Starting with May 15, 2023, the stock symbol will be LION.
The depositary bank of the Company, starting November 28, 2019, is Banca Comercială Română (BCR), until that date being BRD - Groupe Société Générale (from January 29, 2014).
The company providing shareholders' registry services is Depozitarul Central SA Bucharest.
These condensed interim financial statements as of March 31, 2023, were prepared up in accordance with Rule no. 39/2015 for the approval of accounting regulations in accordance with the International Financial Reporting Standards, applicable to entities authorized, regulated and supervised by the Financial Supervisory Authority in the Financial Instruments and Investments Sector (the Rule) and with the requirements of IAS 34 "Interim financial reporting" and must be read together with the standalone financial statements for 2022.
In accordance with Regulation no. 1606/2002 of the European Parliament and of the Council of the European Union of July 19, 2002, as well as with Law no. 24/2017 on issuers of financial instruments and market operations from 2017, the Company has to prepare and submit to the Financial Supervisory Authority (ASF) annual consolidated financial statements, in accordance with IFRS, within 4 months from the end of the financial year financial. The company prepared and made public the consolidated financial statements for the financial year 2022.
In accordance with IAS 27 and IFRS 10, starting from the financial year 2018, the Company measures all its subsidiaries at fair value through the profit or loss account, except for subsidiaries providing investmentrelated services, which will continue to be consolidated. Under these conditions, the Company will prepare two sets of financial statements: standalone and consolidated, in accordance with the provisions of IFRS 10 and IAS 27. At the same time, the Company reviewed the analysis regarding the fulfilment of the classification criteria as an investment entity for the years 2021 and 2022, concluding that they are met and that it will apply the exception provided by IFRS 10 regarding investment entities and for the financial statements related to the financial years 2022 and 2023.
The business segments are reported in a manner compatible with internal reporting, analysed by the Company's main decision-maker (the Board of Directors), which is responsible for allocating resources and evaluating the performance of the operating segments. Reportable segments whose revenues, result or assets are ten or more percent of all segments are reported separately. The Company manages all activities as a single reportable business segment.
The Company has adopted a presentation based on liquidity in the condensed interim statement of financial position and a presentation of income and expenses according to their nature in the interim condensed statement of comprehensive income, considering that these methods of presentation provide information that is reliable and more relevant than the information presented on other methods allowed by IAS 1 "Presentation of financial statements".
The condensed interim financial statements are prepared on a fair value basis convention, for the financial assets and liabilities, at fair value through profit and loss or by other comprehensive income.
Other financial assets and liabilities, as well as non-financial assets and liabilities, are stated at amortized cost, revaluated amount, or historical cost.
The Company's management considers that the functional currency, as defined by IAS 21 "The effects of changes in Foreign Exchange Rates", is the Romanian Leu (RON or lei). The condensed interim financial statements are presented in RON, rounded to the nearest unit, which is the presentation currency chosen by the Company's management.
The preparation of the condensed interim financial statements pursuant to IFRS requires that management makes estimates, judgements, and assumptions that affect the application of accounting policies as well as the reported value of assets, liabilities, income, and expenses.
Such estimates and related assumptions are based on historical experience and various other factors that are believed to be reasonable under the given circumstances. The result of these estimates forms the basis of judgments used in assessing the carrying value of assets and liabilities for which no other evaluation sources are available. Actual results may differ from the estimated values.
The estimates and underlying assumptions are revised on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised, if the revision affects only that period or if the period of the revision and future periods are affected the revision affects both current and future periods. Judgments made by the management in applying IFRS having a significant impact on the separate financial statements and the estimates that involve a significant risk of a material adjustment in the next year are presented in the Notes to the condensed interim financial statements.
The accounting policies adopted are consistent with those used in the previous year.
The accounting policies used in these condensed interim financial statements are the consistent with those of the standalone financial statements prepared as of December 31, 2022.
Financial assets held are presented by the Company as per IFRS 9 "Financial Instruments" as financial assets and financial liabilities.
The Company presents the financial assets at amortized cost, at fair value through other comprehensive income, or at fair value through profit and loss on the basis of:
• Represents the way an entity manages its financial assets to generate cash flows: collecting, sale of assets, or both;
• Determining it is factually realized considering: the manner of assessment and reporting of its performance, the existing risks and their management, respectively the way of compensating the management (based on the fair value or the cash flows associated with these investments);
Business model for the shares held for which the option FVTOCI was selected at the date of transition or the date of initial recognition
• Effective management of a diversified portfolio of quality assets, able to ensure a constant flow of income, preservation, and medium-long term growth of capital, to increase value for shareholders and obtain the highest returns on invested capital
The differentiated approach adopted by the Company for each of its holdings aims at the fruition of an aggregate yield, generated from dividend income and capital gain.
It comprises criteria measuring to what extent the structure of the cash flows of a debt instrument classifies within the model of the base credit agreement (the interest reflects the value of money in time, credit risk associated with the principal, coverage of other risks and costs associated with lending and a profit margin).
There are some ratios indicating the case in which the debt instruments held should be measured at fair value through profit and loss:
There are also ratios that, although they would require a registration at fair value, could comply, under certain circumstances, with the SPPI criterion and so the respective assets should be further accounted for at amortized cost:
A financial asset must be measured at fair value through profit and loss, except if it is measured at amortized cost or at fair value through other comprehensive income.
A financial asset, such as debt instruments, must be measured at fair value through other comprehensive income if both conditions presented below are met:
The company can make an irrevocable choice upon the initial recognition in case of certain investments in equity instruments that otherwise would have been measured at fair value through profit or loss to present the subsequent changes of fair value in other comprehensive income (according to pt. 5.7.5 and 5.7.6 of IFRS 9 – Financial Instruments).
A financial asset must be measured at amortized cost if both conditions below are met:
Financial liabilities are measured at fair value through profit and loss (FVTPL) if they:
The other financial debts are measured at amortized cost.
The assets and liabilities are recognized on the date when the Company becomes a contractual party to the conditions of the respective instrument. When the Company recognizes a financial asset for the first time, it must classify it according to pt. 4.1.1 - 4.1.5 (at amortized cost, at fair value through profit or loss or at fair value through other comprehensive income) of IFRS 9 and to assess it according to pt. 5.1.1-5.1.3. (a financial asset or financial liability is measured at fair value adding or subtracting the transaction costs, directly attributable to the acquisition or issue of the asset or liability).
After the initial recognition, the entity must measure (evaluate) the financial assets according to pt. 4.1.1 – 4.1.5 of IFRS 9 at:
After the initial recognition, the entity must measure the financial liabilities according to pt. 4.2.1-4.2.2 of IFRS 9. Thus, the Company will classify all financial liabilities at amortized cost, except for:
a) the financial liabilities measured at fair value through profit and loss;
b) the financial liabilities that appear when the transfer of a financial asset does not qualify for derecognition;
c) financial collateral contracts valued at the highest value of the loss provision (Section 5.5 of IFRS 9) and the amount initially recognized less accumulated income (recognized under IFRS 15);
d) commitments to provide a loan at an interest rate below the market value measured at the highest value of the loss provision (Section 5.5 of IFRS 9) and the amount initially recognized less accumulated income (recognized under IFRS 15)
e) contingent consideration recognized by an acquirer in a business combination to which IFRS 3 applies.
The amortized cost of a financial asset or of a financial liability is the value at which the financial asset or the financial liability is measured after the initial derecognition minus the reimbursement of principal, plus or minus the accumulated amortization using the effective interest method for each difference between the initial value and the value at due date, and minus any reduction for estimated credit losses.
The effective interest rate represents the rate that precisely updates the future proceeds in cash during the forecasted life of the financial instrument up to the level of the gross carrying amount of the financial asset
or of the financial liability. For the calculation of the effective interest rate, the entity must estimate the cash flows considering all contractual conditions of the financial instrument but must not consider the future losses from the changes in credit risk. The calculation includes all commissions paid or cashed by the contracting parties that make integral part of the effective interest rate, transaction costs and all the other premiums and discounts.
Fair value represents the price that would be received upon the sale of an asset or paid to settle a debt within a transaction occurred under normal conditions between the participants in the main market, on the measurement date, or in the absence of the main market, on the most advantageous market to which the Company has access at that date.
The company measures the fair value of a financial instrument using the prices quoted on an active market for that instrument. A financial instrument has an active market if for that instrument quoted prices are readily available and regularly. The company measures the instruments quoted on the active markets using the closing price.
A financial instrument is considered as being quoted on an active market when the quoted prices are readily and regularly available from an exchange, dealer, broker, association within the industry, a service for establishing the prices or a regulatory agency, and these prices reflect the transactions occurring actually and regularly, performed under objective market conditions.
Within the category of shares quoted on an active market, all those shares admitted to trading on the Stock Exchange or on the alternative market having frequent transactions are included. The market price used to determine the fair value is the closing price of the market on the last trading day before the measurement date.
The fund units are measured according to the Unitary Net Asset Value, calculated by the fund administrator using the closing quotations for the quoted financial instruments.
Government securities (bonds) are measured based on the market quotation available on Bloomberg for the respective item, multiplied by the unit nominal value.
In the absence of a price quotation on an active market, the Company uses valuation techniques. The fair value of the financial assets not traded on an active market is determined by authorized valuators.
The valuation techniques include techniques based on the use of observable inputs, such as the quoted price of the identical element held by another party as asset, on a market that is not active, and for the assets for which the observable prices are not available, measurements techniques based on the analysis of the updated cash flows, and other measurement methods used regularly by the market participants. These include the method of comparisons with similar instruments for which there is an observable market price or the percentage method of the net assets of these companies adjusted with a discount for minority ownership and a discount for lack of liquidity, using at maximum the market information, being based at minimum on the specific company information. The Company uses evaluation techniques that maximize the use of observable data and minimize the use of non-observable data.
The valuation techniques are used consistently.
The Company must recognize an adjustment for the forecasted losses from credit corresponding to a financial asset that is measured according to pt. 4.1.2 or 4.1.2A of IFRS 9 (debt instruments measured at amortized cost or at the fair value through other comprehensive income), a receivable resulting from a leasing agreement, a credit commitment, and a financial guarantee agreement.
The Company applies the impairment provisions for the recognition of the provision for losses corresponding to the assets measured at fair value through other comprehensive income (debt instruments that meet the criteria of pt. 4.1.2A of IFRS 9 – assets held to collect the cash flows and to sale, whose cash flows represent exclusively principal reimbursement or interest payments). The provision so determined is recognized considering other comprehensive income and does not reduce the carrying amount (book value) of the financial asset from the statement of the financial position.
On each reporting date, the Company measures the provision for losses related to a financial instrument as to reflect:
The credit losses forecasted for a 12-month period, if the credit risk has not increased significantly as of the initial recognition;
The credit losses forecasted during the entire life if the credit risk has increased significantly as of the initial recognition.
The Company recognizes in profit and loss, as gain or loss from impairment, the value of the forecasted, recognized, or reversed losses, required to adjust the provision for losses on the reporting date up to the level required by the provisions of IFRS 9.
The Company measures the expected credit losses of a financial instrument so that it represents:
The Company may assume that the risk credit for a financial instrument has not increased significantly as of the initial recognition if the financial instrument is considered to have a low edit risk on the reporting date. A financial instrument is considered to have a low credit risk if:
In the assessment of low credit risk for issuers, no real collateral is considered. At the same time, financial instruments are not considered to be of low risk only because they have a lower risk than the other instruments issued by the debtor or in comparison with the credit risk prevailing in the geographical region or the jurisdiction in which it operates.
In the credit risk assessment, the company uses both external credit risk ratings and internal evaluations that are consistent with generally accepted definitions of credit risk.
The Company derecognizes a financial asset when the rights to receive cash flows from that financial asset expires, or when the Company transferred the rights to receive the contractual cash flows corresponding to that financial asset in a transaction in which it significantly transferred all risks and benefits of the ownership right.
Any interest in the transferred financial assets retained by the Company or created for the Company is recognized separately as an asset or liability.
The Company derecognizes a financial liability when the contractual obligations ended or when the contractual obligations are cancelled or expire.
Derecognition of financial assets and liabilities is accounted for using the weighted average cost method. This method entails calculating the value of each item based on a weighted average of the value of similar items in stock at the beginning of the period and the value of similar items purchased during the period.
If the Company reclassifies the financial assets according to pt. 4.4.1 of IFRS 9 (as an effect of changing the business model for the management of its financial assets), then all the affected financial assets will be reclassified. The financial liabilities (debts) cannot be reclassified after the initial recognition.
The Company applies the reclassification of financial assets prospectively as of the reclassification date. The possible earnings, losses, or interests previously recognized will not be restated.
If a reclassification occurs, the Company proceeds as follows:
When reclassifying an asset from the amortized cost category to fair value through profit or loss, the fair value is determined at the date of reclassification. The difference between the amortized cost and the fair value is recognized in profit and loss;
When reclassifying an asset from the fair value through profit and loss category to the amortized cost, the fair value at the date of reclassification becomes the new gross carrying amount;
When reclassifying an asset from the amortized cost category to fair value through other comprehensive income, fair value is determined at the date of reclassification. The difference between the amortized cost and the fair value is recognized in other comprehensive income, without adjusting the effective interest rate or the expected loss from lending;
When reclassifying an asset from the category of fair value through other comprehensive income to the amortized cost, the reclassification is carried at the fair value of the asset from the reclassification date. Amounts previously recognized in other comprehensive income are eliminated in relation to the fair value of the asset, without affecting the profit and loss account. The actual interest rate and the expected loss on credit are not adjusted as a reclassification effect;
When reclassifying an asset from the fair value through profit and loss category to fair value through other comprehensive income, the asset continues to be measured at its fair value;
When reclassifying an asset from fair value through other comprehensive income category to fair value through profit and loss, the financial asset continues to be measured at fair value. Amounts previously recognized in other comprehensive income are reclassified from equity to profit and loss as a reclassification adjustment (as per IAS1).
Gains or losses resulting from a change in the fair value of a financial asset or of a financial liability that is not part of a hedging relationship are recognized as follows:
Gains on shares measured at fair value through other comprehensive income are recognized as follows: - Changes in fair value (including exchange rate) in other comprehensive income
Gains on debt instruments (bonds):
When the asset is derecognized, the accumulated losses or gains previously recognized in other comprehensive income:
When the financial assets accounted for at amortized cost are impaired or derecognized, as well as through their amortization process, the Company recognizes a gain or a loss in the profit and loss account (income statement).
As regards the recognized financial assets using the settlement date accounting, no change of the fair value of the asset to be received during the period between the trading date and the settlement date is recognized for the assets carried at cost or at amortized cost (except for impairment losses). But for the assets accounted for at fair value, the change in fair value must be recognized in profit and loss or in equity, as the case may be.
Other financial assets and liabilities are measured at amortized cost using the effective interest method.
The risk management activity can be found in the Company organizational structure, and it addresses both general and specific risks.
The most significant financial risks to which the Company is exposed to are the credit risk, the liquidity risk, and the market risk. The market risk includes the foreign currency risk, the interest rate risk, and the price risk of the equity instruments. This note provides information on the Company's exposure to each of the above-mentioned risks, the Company's objectives and policies, and the risk assessment and risk management processes.
The company uses various policies and procedures for managing and measuring the types of risk to which it is exposed. These policies and procedures are presented in the subchapter dedicated to each type of risk.
Market risk is the present or future risk of recording losses balance and off-balance sheet related due to adverse movements in market price (such as stock prices, interest rates, foreign exchange rates). Company's management sets the limits on the value of risk that may be accepted, which are regularly monitored. However, the use of this approach does not prevent losses outside these limits in the event of more significant market movements.
Position risk is associated with financial instruments portfolio held by the Company with intention to benefit from positive price movements of those financial assets or potential dividends/coupons issued by entities. The Company is exposed to general position risk as well as to the specific one, due to short term investments made in bonds, shares, and fund units.
The management has pursued and permanently aims to reduce to a minimum the possible adverse effects related to this financial risk, through an active procedure of diversifying prudently the investment portfolio and by using one or more technics of diminishing of the risk through trading activity or market prices evolution related to financial instruments held by the Company.
Concentration risk concerns all assets held by the Company, regardless of the period of holding them, and mitigating this risk is intended the avoidance of a too large exposure on the same debtor/entity at Company level.
The management's policy of diversifying exposures is applied to the portfolio structure, business structure, as well as the structure of financial risks exposure. Thus, this diversifying policy implies avoiding excessive exposures on a single debtor, issuer, country, or geographical area; diversifying business structure pursues the avoidance at Company's level the excessive exposure against a specific type of business/sector; diversifying the structure of financial risks intends to avoid excessive exposure against a certain financial risk.
The market risk of equity instruments is mainly the result of shares measured at fair value through other comprehensive income and through profit and loss. Entities in which the Company holds shares operate in various industries.
The objective of market risk management is to control and manage market risk exposures in acceptable parameters to the extent that profitability is optimized.
The Company's strategy for managing market risk is driven by its investment objective, and the market risk is managed in accordance with its policies and procedures.
The Company is exposed to the following categories of market risk:
Price risk is the risk of losses in both balance sheet and off-balance sheet positions due to changes in asset prices.
The Company is exposed to the risk of fair value of financial instruments fluctuation due to changes in market prices, whether caused by factors specific to the activity of its issuer or factors impacting all instruments traded in the market.
The Board of Directors monitors the market risk management, and the internal procedures require that when price risks are not consistent with the Company's investment policy and principles, the portfolio must be rebalanced.
A positive change of 10% in the price of financial assets at fair value through profit and loss (shares of subsidiaries, associates, fund units and corporate bonds) would lead to an increase in profit after tax by RON 157,414,180 (December 31, 2022: RON 154,210,928), a negative change of 10% having an equal net impact in the opposite direction.
A positive change of 10% in the prices of financial assets measured at fair value through other comprehensive income, investments in shares and corporate bonds, would lead to an increase in equity, net of tax, of RON 142,638,235 (December 31, 2022: RON 139,304,936), a negative change of 10% having an equal net impact in the opposite direction.
The company holds stakes in companies operating in various sectors. As it can be noticed from the table below, as of March 31, 2023, the Company mainly held shares in companies in the banking-financial and insurance field, having a weight of 44.3% on the total portfolio, slightly decreasing from the weight of 46.7% as of December 31, 2022.
| in RON | March 31, 2023 | % | December 31, 2022 | % |
|---|---|---|---|---|
| Financial intermediation and insurance | 1,263,680,356 | 44.3% | 1,320,286,502 | 46.7% |
| Manufacturing industry | 725,756,117 | 25.4% | 706,121,167 | 24.9% |
| Hotels and restaurants | 175,785,939 | 6.2% | 133,536,179 | 4.7% |
| Wholesale and retail trade, repair of motor vehicles | 39,160,957 | 1.4% | 39,160,957 | 1.4% |
| Extractive industry | 163,514,895 | 5.7% | 149,134,107 | 5.3% |
| Other activities | 305,109 | 0.0% | 701,349 | 0.0% |
| Financial services applicable to real estate | 425,458,460 | 14.9% | 425,284,860 | 15.0% |
| Constructions | 3,277,719 | 0.1% | 3,277,721 | 0.1% |
| Transportation and storage | 42,430,596 | 1.5% | 38,232,508 | 1.4% |
| Rental of real-estate | 14,281,270 | 0.5% | 14,281,270 | 0.5% |
| Agriculture, forestry, and fishing | 2,113 | 0.0% | 151,925 | 0.0% |
| TOTAL | 2,853,653,532 | 100% | 2,830,168,544 | 100% |
The total value growth of the portfolio under management compared to the end of the previous year is due to the progress of capital markets during first three months of 2023 with favourable influence on the market prices of the listed financial assets, in the Company's portfolio.
As of March 31, 2023, and December 31, 2022, the Company holds fund units amounting to RON 373,640,774 (December 31, 2022: RON 362,939,797) in the closed end investment funds Active Plus, Optim Invest, Certinvest Shares, Star Value, and Romania Strategy Fund. The Company is exposed to price risk in terms of placements made with different risk degrees by these Investment Funds.
Interest rate risk is the risk that revenues or expenses, or the value of assets or liabilities of the Company fluctuate due to changes in market interest rates.
As regards the interest-bearing financial instruments: the interest rate risk consists of the risk of fluctuation recorded in the value of a financial instrument due to changes in interest rates and risk differences between the maturity of interest-bearing financial assets and interest-bearing liabilities. However, the interest rate risk may also affect the value of assets bearing fixed interest rates (e.g. bonds) so that an increase in interest rate on the market will determine a decrease in the value of future cash flows generated by them and may lead to their price reduction if it increases the preference of investors to place their funds in bank deposits or other instruments whose interest has grown, and vice versa - a reduction in interest rate on the market may increase the price of shares and bonds and will lead to an increase in the fair value of future cash flows.
With respect to the fixed interest-bearing assets or tradable assets, the Company is exposed to the risk that fair value of future cash flows related to financial instruments will fluctuate following the changes in market interest rates. However, most financial assets of the Company are in stable currencies whose interest rates are unlikely to vary significantly.
Thus, the Company will be subject to limited exposure to the fair value interest rate risk or to future cash flows due to fluctuations in the prevailing levels of market interest rates.
The Company does not use derivative financial instruments for protection against interest rate fluctuations.
The following table shows the annual interest rates earned by the Company for interest-bearing assets during first quarter of 2023:
| RON interval EUR interval |
|||||
|---|---|---|---|---|---|
| Financial assets | Min | Max | Min | Max | |
| Bank deposits | 4.86 | 6.75 | - | - | |
| Financial assets at fair value through profit and loss* | 9.27 | 10.2 | 5.63 | 5.63 |
* In the financial assets at fair value through profit and loss are included bonds denominated in RON issued by a subsidiary and a loan denominated in euro granted to a subsidiary
The following table shows the annual interest rates earned by the Company for interest-bearing assets during the first three months of 2022:
| RON interval | EUR interval | |||
|---|---|---|---|---|
| Financial assets | Min | Max | Min | Max |
| Bank deposits | 0.80 | 3.30 | 0.06 | 0.12 |
| Financial assets at fair value through profit and loss* | 4.30 | 5.05 | - | - |
| Financial assets at fair value through other comprehensive income** | - | - | 5.75 | 5.75 |
* In the financial assets at fair value through profit and loss are included bonds, denominated in RON issued by a subsidiary of Lion Capital ** Corporate bonds issued by Impact (in euro) are included in the financial assets at fair value through other items of comprehensive income
The following table presents a summary of Company's exposure to the interest rate risk. The table includes the Company's assets and liabilities at the carrying amounts (book value) classified by the most recent date of the change in the interest rate and the maturity date.
| in RON | March 31, 2023 | December 31, 2022 |
|---|---|---|
| Cash and cash equivalent* | 3,240,000 | 6,625,573 |
| Financial assets at FVTPL – corporate bonds | 37,612,296 | 37,612,296 |
| Financial assets at FVTOCI – corporate bonds | 115,845,003 | 115,805,211 |
| TOTAL | 156,697,299 | 160,043,080 |
* Within the cash equivalents short-term investments in bank deposits (maturity less than 3 months) are included
The impact on the Company's net profit (through interest income) of a change of ±1.00% in the interest rate on variable interest rate assets and liabilities denominated in other currencies in conjunction with a change
of ±1.00% in the interest rate related to the assets and liabilities bearing variable interest and expressed in RON is of RON 1,316,257 (December 31, 2022: RON +/-1,344,362).
For bonds recorded at fair value (level 1) held, a variation of +/- 5% of their market price determines a net impact in the amount of RON +/- 1,579,716 (December 31, 2022: RON +/- 1,579,716) in the profit and loss account.
Currency risk is the risk of loss or failure to achieve the estimated profit because of unfavourable exchange rate fluctuations. The Company invests in financial instruments and performs transactions which are denominated in currencies other than the functional currency, thus being exposed to risks that the exchange rate of the national currency in relation to another currency might adversely affect the fair value or future cash flows of that share of financial assets and liabilities denominated in other currencies.
In the reporting periods the company conducted transactions in Romanian currency (RON) and in foreign currencies. The Company has not carried out any exchange rate derivative transaction during the financial years presented.
The Company's assets and liabilities in RON and foreign currencies on March 31, 2023, and December 31, 2022 can be analysed as follows:
Financial assets exposed to foreign currency risk (in RON) in RON March 31, 2023 December 31, 2022
| Net financial assets | 316,271,609 | 293,976,623 |
|---|---|---|
| Total liabilities | (463,991) | (530,880) |
| Liabilities on leasing contract | (463,991) | (530,880) |
| Total assets | 316,735,601 | 294,507,503 |
| Financial assets at FVTOCI** | 120,758,040 | 147,927,260 |
| Financial assets at FVTPL – (including assets held by investment funds) * | 144,915,629 | 126,798,355 |
| Cash and cash equivalent | 51,061,931 | 19,781,888 |
* Financial assets at fair value through profit or loss include euro bonds and foreign exchange holdings of closed-end investment funds, proportional to the Company's holding in their net assets.
** Financial assets at fair value through other comprehensive income in EUR result include holdings held abroad, namely Austria - Erste Bank.
The following table presents the sensitivity of profit and loss as well as equity to possible changes at the end of the reporting period of the exchange rates in line with the reporting currency, consistently maintaining all other variables:
| March 31, 2023 | December 31, 2022 | ||||
|---|---|---|---|---|---|
| Impact on P&L | Impact on OCI | Impact on P&L | Impact on OCI | ||
| 5% EUR increase (2022: 5%) | 8,211,570 | 5,071,838 | 6,134,073 | 6,212,945 | |
| 5% EUR decrease (2022: 5%) | (8,211,570) | (5,071,838) | (6,134,073) | (6,212,945) | |
| Total | - | - | - | - |
Credit risk is the risk that a counterparty of a financial instrument fails to meet their contractual obligations, or a financial engagement in which it has entered into a relationship with the Company, thus resulting in a loss for the Company. The Company is exposed to credit risk as a result of investments in bonds issued by trading companies (corporate bonds), current accounts and bank deposits and other receivables. The management of the Company closely and constantly monitors the exposure to credit risk so that it does not suffer losses as a result of the concentration of credit in a certain sector or field of activity.
As of March 31, 2023, and December 31, 2022, the Company did not have any real collaterals as insurance, nor any other improvements in the credit rating.
As of March 31, 2023, and December 31, 2022, the Company did not record any outstanding financial assets, for which it had not recorded any impairment adjustments.
Below are presented the financial assets with exposure to credit risk:
| March 31, 2023 | Current accounts | Bank deposits | Loan granted | Bonds (measured at FVTPL) |
Other financial assets |
Total |
|---|---|---|---|---|---|---|
| Current and not impaired Rating AAA to A BBB+ |
50,977,294 | 3,240,000 | - | - | - | 54,217,294 |
| March 31, 2023 | Current accounts | Bank deposits Loan granted |
Bonds (measured at FVTPL) |
Other financial assets |
Total | |
|---|---|---|---|---|---|---|
| BBB | 20,591 | - | - | - | - | 20,591 |
| BBB- | 1,903 | - | 1,903 | |||
| BB+ | 1,051,302 | - | - | - | - | 1,051,302 |
| BB | 3,312 | 3,312 | ||||
| NR | - | - | 118,561,432 | 38,230,398 | 9,077,892 | 165,869,722 |
| TOTAL | 52,054,401 | 3,240,000 | 118,561,432 | 38,230,398 | 9,077,892 | 221,164,123 |
| December 31, 2022 | Current accounts | Bank deposits | Bonds (measured at FVOCI) |
Bonds (measured at FVTPL) |
Other financial assets |
Total |
|---|---|---|---|---|---|---|
| Rating AAA to A | ||||||
| BBB+ | 19,739,379 | 1,045,573 | 20,784,953 | |||
| BBB | 21,282 | - | 21,282 | |||
| BBB- | 2,123 | - | 2,123 | |||
| BB+ | 208,844 | 5,580,000 | 5,788,844 | |||
| BB | 3,491 | 3,491 | ||||
| Baa2 | - | |||||
| NR | 116,912,505 | 38,313,018 | 12,834,480 | 168,060,003 | ||
| TOTAL | 19,975,119 | 6,625,573 | 116,912,505 | 38,313,018 | 12,834,480 | 194,660,696 |
The Company's maximum exposure to credit risk is of RON 221,164,123 as of March 31, 2023 (December 31, 2022: RON 194,660,696) and can be analysed as follows:
| Credit rating | March 31, 2023 | December 31, 2022 | |||
|---|---|---|---|---|---|
| BRD - Groupe Société Générale | BBB+ | BRD - Groupe Société Générale | Fitch | 14,354,851 | 14,394,427 |
| Banca Transilvania | BB+ | Banca Transilvania | Fitch | 1,051,302 | 5,788,844 |
| Banca Comercială Română | BBB+ | Banca Comercială Română | Fitch | 39,862,443 | 6,390,525 |
| CEC Bank | BB | CEC Bank | Fitch | 3,312 | 3,491 |
| Exim Bank | BBB- | Exim Bank Romania | Fitch | 1,903 | 2,123 |
| Intesa Sanpaolo Romania* | BBB | Intesa Sanpaolo Italia | Fitch | 20,468 | 20,847 |
| UniCredit Tiriac | BBB | UniCredit Tiriac | Fitch | 123 | 435 |
| TOTAL (Note 11) | 55,294,401 | 26,600,693 |
* For banks for which there is no rating, the parent company's rating was considered
The cash and cash equivalent and bank deposits are not past due and are not impaired. The corporate bonds are not past due and are not impaired.
The Company's exposure to credit and counterparty risk through corporate bonds held as of March 31, 2023, is presented in the following table:
| Issuer | Quantity | Nominal value |
Interest rate |
Value as of March 31, 2023 (RON) |
Maturity | |
|---|---|---|---|---|---|---|
| Vrancart SA* Total |
RON | 368,748 | 100.00 | 9.27% | 37,612,296 37,612,296 |
2024 |
* variable interest rate (related to the most recent coupon)
The Company's exposure to credit and counterparty risk through corporate bonds held as of December 31, 2022, is presented in the following table:
| Issuer | Quantity | Nominal value |
Interest rate |
Value as of December 31, 2022 (RON) |
Maturity | |
|---|---|---|---|---|---|---|
| Vrancart SA* | RON | 368,748 | 100.00 | 10.20% | 37,612,296 | 2024 |
| Total | 37,612,296 |
* variable interest rate (related to the most recent coupon)
Liquidity risk is the risk that the Company encounters difficulties in meeting obligations arising from shortterm financial liabilities that are settled by payment in cash or other financial means, or the risk that such obligations are settled in an unfavourable manner for the Company.
The company monitors the progress of its liquidity levels to be able to meet its payment obligations at due date, and constantly analyses its assets and liabilities, based on the remaining period to the contractual maturities.
In the current economic context, the Company's management has adopted a prudent policy of monetary investments management, maintaining a weight of available liquidity in total assets allowing at any time the coverage of any outstanding payment obligations and a liquidity reserve to provide the financing of any attractive investment opportunities.
The breakdown of assets and liabilities was analysed based on the remaining period from the balance sheet date to contractual maturity date, both as of March 31, 2023, and December 31, 2022, as follows:
| in RON | Book value | Less than 3 months |
3 to 12 months |
Over 1 year | No fixed maturity |
|---|---|---|---|---|---|
| March 31, 2023 | |||||
| Financial assets | |||||
| Cash and cash equivalent | 55,300,416 | 55,300,416 | - | - | - |
| Bank deposits | - | - | - | ||
| Financial assets at FVTPL | 1,759,121,827 | 618,102 | 156,173,728 | 1,602,329,996 | |
| Financial assets at FVTOCI | 1,624,964,308 | - | - | 1,624,964,308 | |
| Other financial assets | 9,795,369 | 9,795,369 | - | - | - |
| Total financial assets | 3,449,181,920 | 65,713,888 | 156,173,728 | - | 3,227,294,304 |
| Financial liabilities | |||||
| Dividends payable | 9,992,979 | 9,992,979 | - | - | - |
| Other financial liabilities | 12,125,383 | 12,125,383 | - | - | - |
| Liabilities on leasing contract | 463,992 | 67,911 | 209,906 | 186,174 | - |
| Total financial liabilities | 22,582,354 | 22,186,273 | 209,906 | 186,174 | - |
| Liquidity surplus | 3,426,599,566 | 43,527,614 | 155,963,822 | (186,174) | 3,227,294,304 |
| in RON | Less than 3 | 3 to 12 | Over 1 year | No fixed | |
| Book value | months | months | maturity | ||
| December 31, 2022 | |||||
| Financial assets | |||||
| Cash and cash equivalent | 26,615,152 | 26,615,152 | - | - | |
| Bank deposits Financial assets at FVTPL |
- 1,723,810,844 |
700,722 | 116,912,505 | - 37,612,296 |
1,568,585,321 |
| Financial assets at FVTOCI | 1,624,523,020 | - | - | 1,624,523,020 | |
| Other financial assets | 13,551,957 | 13,551,957 | - | - | |
| Total financial assets | 3,388,500,973 | 40,867,831 | 116,912,505 | 37,612,296 | 3,193,108,341 |
| Financial liabilities | 10,042,310 | 10,042,310 | - | - | |
| Dividends payable | |||||
| Other financial liabilities Liabilities on leasing contract |
15,038,374 530,880 |
15,038,374 67,048 |
- 206,746 |
- 257,087 |
|
| Total financial liabilities | 25,611,564 | 25,147,732 | 206,746 | 257,087 | |
By the nature of the business object, the Company is exposed to various types associated to financial instruments and to market on which it invests.
The main types of risks the Company is exposed to are:
The risk management has in view the maximization of Company's profit in relation to the risk level it is exposed to.
The Company uses various management and measurement policies and procedures for the risk types it is exposed to. These policies and procedures are presented in the subchapter dedicated to each type of risk.
Starting with 1 January 2007, following Romania's accession to the European Union, the Company had to comply with the EU regulations and, therefore, prepared to implement changes brought by the European
legislation. The Company has implemented these changes, but their implementation remains open to tax audit for 5 years.
Interpretation of texts and practical implementation of the procedures of the new applicable tax regulations could vary and there is a risk that in some cases the tax authorities might adopt a position different from that of the Company.
In terms of income tax there is a risk of different interpretation by the tax authorities to accounting treatments that were determined by the transition to IFRS as an accounting basis.
In addition, the Romanian Government has several agencies authorized to conduct audits (controls) of companies operating in Romania. These controls are similar to tax audits in other countries and may extend not only to tax matters but also to other legal and regulatory issues of interest to these agencies. The Company may be subject to tax audits as new tax regulations are issued.
Lion Capital's management cannot predict all the effects of the international economic developments with an impact on the financial sector in Romania but has confidence in that in the first three months of 2023 has adopted the necessary measures for the Company's sustainability and development under the present state of the financial market by monitoring its cash flows and adapting its investment policies.
Risk avoidance and mitigation of their effects are ensured by the company through an investment policy complying with the prudential rules imposed by the applicable laws and regulations in force.
Lion Capital has adopted risk management policies through which risks are actively managed, by implementing specific risk identification, evaluation, measurement, and control procedures meant to provide reasonable assurance with respect to the achievement of the Company's objectives, thus seeking a consistent balance between risk and expected profit.
The risk management aims at: (i) identifying and assessing significant risks with major impact in achieving the target investment and developing activities to counter the risk identified; (ii) adapting the risk management policies to the developments in the financial capital market, monitoring performance and improving risk management procedures; (iii) reviewing investment decisions in line with the development of the capital and money market; (iv) compliance with the legislation in force.
Geopolitical tensions over the past 12 months and increased supply insecurity in the energy sector have led to significant increases in oil and natural gas prices in 2022. Aggressive measures adopted by the main central banks (Federal Reserve, European Central Bank, etc.) for tempering inflation and the uncertainties regarding the short-term and medium-term impact of these measures on the macroeconomic evolution have led to high volatility among the main capital markets. The lack of visibility regarding the attitude of central banks to these externalities, the necessary level of successive increases in interest rates and their impact on global demand represent the main challenges in managing the asset portfolio in 2023 as well.
Operational risk is the risk of direct or indirect loss resulting from deficiencies or weaknesses in procedures, personnel, the Company's internal systems, or from external events that can have an impact on its operations. Operational risks arise from all the Company's activities.
The Company's objective is to manage the operational risk so as to limit financial loss, not damage its reputation and achieve the investment objective of generating benefits for investors.
The primary responsibility for implementation and development of control over the operational risk lies with the Board of Directors. This responsibility is supported by the development of general standards of operational risk management, which includes controls and processes at service providers and service engagements with service providers.
The management's policy with respect to capital adequacy focuses on maintaining a sound capital base to support the ongoing development of the Company and attain the investment objectives.
The Company's equity includes the share capital, various types of reserves and the retained earnings. Equity amounted to RON 3,307,013,605 as of March 31, 2023 (RON 3,242,853 as of December 31, 2022).
As per IFRS 9 and since the Company has opted to measure shareholdings through other comprehensive income, dividends from these shareholdings are recognized as income unless they are a substantially recovery of the cost of investment.
Dividend income is recorded as gross value. The tax rate for dividends from companies was of 0 (2022: 5%). The breakdown of dividend income on the main counterparties is shown in the table below:
| denominated in RON | March 31, 2023 | March 31, 2022 | Measurement |
|---|---|---|---|
| BRD - Groupe Société Générale | - | 32,900,487 | FVTOCI |
| Total | - | 32,900,487 |
FVTPL = financial assets at fair value through profit and loss | FTVOCI = financial assets at fair value through other comprehensive income
| denominated in RON | March 31, 2023 | March 31, 2022 |
|---|---|---|
| Interest income on bank deposits and current accounts | 62,830 | 55,051 |
| Interest income on assets measured through other comprehensive income (corporate bonds) |
- | 73,637 |
| 62,830 | 128,688 |
| Interest income (assets at FVTPL) | ||
|---|---|---|
| denominated in RON | March 31, 2023 | March 31, 2022 |
| Interest income on corporate bonds | 865,417 | 440,984 |
| Interest income related to the transfer of financial assets* | 432,160 | 260,112 |
| Interest income related to a loan agreement | 1,602,788 | - |
| 2,900,364 | 701,096 |
* The amount represents the financing component extracted from the total value of the contract for the transfer of the stake in Central S.A., according to the contractual clauses agreed by the parties
| denominated in RON | March 31, 2023 | March 31, 2022 |
|---|---|---|
| Profit / (Loss) from measurement/transfer of fund units | 10,700,977 | 1,945,877 |
| Profit / (Loss) from measurement of bonds | - | - |
| Profit / (Loss) from measurement of shares in subsidiaries and associates | 23,043,699 | (65,632,544) |
| Total | 33,744,676 | (63,686,667) |
As of March 31, 2023, and March 31, 2022, the Company measured the investments held in fund units, the shares held in subsidiaries and associates (measured on level 1), and the bonds held, through the profit and loss account, resulting an increase of RON 33.7m (March 31, 2022: decrease amounting to RON 63.7m).
| denominated in RON | March 31, 2023 | March 31, 2022 |
|---|---|---|
| Financial Supervisory Authority commissions | 776,266 | 781,039 |
| Depository (bank) fees | 183,530 | 182,947 |
| Commissions due for transactions | 48,887 | 4,906 |
| Registry fees | 61,108 | 45,240 |
| Other fees and commissions | 16,093 | 14,875 |
| Total | 1,085,885 | 1,029,007 |
| denominated in RON | March 31, 2023 | March 31, 2022 |
|---|---|---|
| Expenses on other taxes, fees, and assimilated payments | 30,146 | 35,262 |
| Expenses on salaries and other personnel expenses | 2,976,375 | 2,819,868 |
| Depreciation expenses | 76,558 | 74,890 |
| Expenses on external services | 639,713 | 639,921 |
| Expenses on interest and depreciation of assets with the right to use under the leasing contract |
69,089 | 71,204 |
| Total | 3,791,880 | 3,641,144 |
| Expenses on salaries | 2,462,422 | 2,308,718 |
| Stock Option Plan expenses | 357,592 | 363,734 |
| Expenditure on insurance and social protection | 85,857 | 97,753 |
| Other personnel expenses | 70,504 | 49,663 |
| Total | 2,976,375 | 2,819,868 |
In other operating expenses are included personnel expenses, expenses on taxes and fees, depreciation expenses and other expenses on external services.
In the period ended on March 31, 2023, the average number of employees was of 31 (March 31, 2022: 32), and the actual number of employees recorded at the end of the reporting period was of 31 (March 31, 2022: 31).
The company makes payments to institutions of the Romanian State in the account of the pensions of its employees. All employees are members of the pension plan of the Romanian State. The company does not operate any other pension scheme or post-retirement benefits and, consequently, has no other obligations concerning pensions. Furthermore, the Company is not bound to provide additional benefits to employees after their retirement.
| denominated in RON | March 31, 2023 | March 31, 2022 |
|---|---|---|
| Current income tax | ||
| Current income tax (16%) | 1,582 | (272,323) |
| Tax on dividend (0%, 5%) | - | 1,645,024 |
| Expense on / (income from) deferred tax | - | |
| Financial assets at FVTOCI | - | - |
| Financial assets at FVTPL | - | - |
| Tangible assets / Investment property | - | - |
| Total income tax recognized in result for the period | 1,582 | 1,372,701 |
The effective tax rate used to calculate the deferred tax of the Company was of 16%.
Reconciliation of profit before tax with expense on income tax in the profit and loss account:
| denominated in RON | March 31, 2023 | March 31, 2022 |
|---|---|---|
| Profit before tax | 32,142,729 | (34,880,820) |
| Tax under statutory tax rate of 16% (2022: 16%) | 5,142,837 | (5,580,931) |
| Income tax effect of: | ||
| Tax on dividend (5%) | - | 1,645,024 |
| Non-deductible expenses and similar items | 1,979,663 | 10,620,320 |
| Non-taxable revenues | (5,599,941) | (5,313,698) |
| Revenue related items | 5,593,780 | 337,105 |
| Expenses related items | (829,234) | - |
| Recoverable tax loss | (1,614,775) | |
| Deferred tax | - | |
| Amounts of sponsorship within legal limits and other deductions | (81,081) | |
| Tax recognized in retained earnings | (4,589,667) | (335,118) |
| Income tax | 1,582 | 1,372,701 |
| denominated in RON | March 31, 2023 | March 31, 2022 |
|---|---|---|
| Petty cash and other valuables | 5,561 | 3,350 |
| Current accounts in banks | 52,054,401 | 19,975,119 |
| Deposits in banks with original maturity less than 3 months (including interest) |
3,240,455 | 6,636,683 |
| Cash and cash equivalents with maturity less than 3 months | 55,300,416 | 26,615,152 |
Current bank accounts and bank deposits are permanently available to the Company and are not restricted.
| denominated in RON | March 31, 2023 | March 31, 2022 |
|---|---|---|
| Shares | 1,228,689,222 | 1,205,645,523 |
| Fund units | 373,640,774 | 362,939,797 |
| Loan granted | 118,561,432 | 116,912,505 |
| Corporate bonds (including attached interest) | 38,230,399 | 38,313,018 |
| Total | 1,759,121,827 | 1,723,810,844 |
As the Company met the classification criteria as an "investment entity", it measures all its subsidiaries at fair value through profit and loss, except for subsidiaries providing investment-related services, that will further be consolidated.
The movement of the financial assets measured at fair value through profit and loss account as of March 31, 2023, is presented in the next table:
| denominated in RON | Shares | Fund units | Loans granted | Corporate bonds | Total |
|---|---|---|---|---|---|
| January 1, 2023 | 1,205,645,522 | 362,939,797 | 116,912,505 | 38,313,018 | 1,723,810,844 |
| Acquisitions | |||||
| Sales | |||||
| Change in interest receivable | - | - | 1,602,788 | (82,619) | 1,520,169 |
| Change in fair value (including | |||||
| foreign exchange differences) | 23,043,699 | 10,700,977 | 46,139 | 33,790,815 | |
| March 31, 2023 | 1,228,689,222 | 373,640,774 | 118,561,432 | 38,230,399 | 1,759,121,827 |
On March 31, 2023, the shares held in subsidiaries and associated entities (level 1) were measured at fair value, the difference being a favourable one amounting to RON 23m (vs. the value on December 31, 2022). The measurement of fund units at fair value as of March 31, 2023, generated a favourable difference of RON 10.7m (vs. the value on December 31, 2022).
The movement of financial assets measured at fair value through profit and loss account in 2021 is presented in the following table:
| denominated in RON | Shares | Fund units | Loans granted | Corporate bonds | Total |
|---|---|---|---|---|---|
| January 1, 2022 | 1,273,327,647 | 369,180,263 | - | 37,907,699 | 1,680,415,609 |
| Acquisitions | 657,463 | - | 115,000,000 | - | 115,657,463 |
| Sales | (27,193,910) | - | (27,193,910) | ||
| Change in interest receivable | - | - | 1,103,608 | 405,320 | 1,508,928 |
| Change in fair value (including | (41,145,678) | (6,240,466) | - | (46,577,247) | |
| foreign exchange differences) | 808,897 | ||||
| December 31, 2022 | 1,205,645,522 | 362,939,797 | 116,912,505 | 38,313,018 | 1,723,810,844 |
Acquisitions made during 2022 include shares in Vrancart S.A. following the participation in the share capital increase with cash contribution, and acquisitions on Bucharest Stock Exchange.
Sales of shares represent the value of the stake held in Gaz Vest SA, sold in full.
The amount of RON 115m represents the loan granted during 2022 to the company SIF Spv Two SA, to pay the award price for the acquisition by transfer of assets of the "Belvedere Cigarette Factory" in the auction organized in the insolvency procedure of Interagro S.A.
The movement of financial assets measured at fair value through other comprehensive income during first nine months of 2022 is presented in the table below:
| denominated in RON | Shares * |
|---|---|
| January 1, 2023 | 1,624,523,020 |
| Acquisitions | - |
| Sales | (39,449,163) |
| Change of interest receivable | - |
| Change in fair value (including foreign exchange differences) | 39,890,451 |
| March 31, 2023 | 1,624,964,308 |
* the option to measure at fair value through other comprehensive income was exercised at initial recognition
Sales of shares amounting to RON 39.4 mainly include the sale of Erste Bank and stakes held in Comelf, Urbana, Anteco, IFB FInwest, Grup Bianca and Bizoofruct, the amount transferred to retained earning related to these being of RON 24m.
The movement of financial assets measured at fair value through other comprehensive income in 2022 is presented in the table below:
| denominated in RON | Shares * | Corporate bonds** |
|---|---|---|
| January 1, 2022 | 1,554,069,140 | 5,283,259 |
| Acquisitions | 357,288,563 | |
| Sales | (3,213,710) | (5,164,320) |
| Change of interest receivable | (9,822) | |
| Change in fair value (including foreign exchange differences) | (283,620,973) | (109,118) |
| December 31, 2022 | 1,624,523,020 | - |
* the option to measure at fair value through other comprehensive income was exercised at initial recognition ** SPPI tested and recognized as held to collect and sale
Purchases of shares in 2022, in the total amount of RON 357.3m, mainly include the acquisition of SIF Muntenia, OMV Petrom, CH Intercontinental SA Bucharest, SIF Oltenia and Impact SA shares.
The sales of shares, in the amount of RON 3.2m, mainly include exits from the companies Reva, Transgex and Prospecțiuni. Net result from transactions, amounting to RON 2.1m, was transferred to retained earnings.
Exits from bonds include the value of Impact bonds cashed in at maturity (December 2022).
The Company uses the following hierarchy of methods to measure fair value:
The fair value of financial assets and liabilities that are traded in active markets are based on quoted market prices or on prices quoted by intermediaries (brokers).
The fair value of the financial instruments for which there is no active market (Level 2 and 3) and those that are not traded is determined by external appraisers using techniques based on the present net value, the discounted cash flow method, the method of comparisons with similar instruments for which there is an observable market price. Valuation techniques are used consistently, there are no changes in their application.
An analysis of the financial instruments and investment property recognized at fair value according to the valuation method is presented in the following table:
| March 31, 2023 | |||
|---|---|---|---|
| denominated in RON | Level 1 | Level 3 | Total |
| Financial assets at FVTPL - shares | 385,112,917 | 843,576,306 | 1,228,689,223 |
| Financial assets at FVTPL - fund units | 373,640,774 | - | 373,640,774 |
| Financial assets at FVTPL – loan granted | - | 118,561,432 | 118,561,432 |
| Financial assets at FVTPL – bonds | 38,230,398 | - | 38,230,398 |
| Financial assets at FVTOCI – shares | 1,470,477,860 | 154,486,449 | ,624,964,309 |
| Investment property | - | 12,963,376 | 12,963,376 |
| Land and buildings | - | 3,310,605 | 3,310,605 |
| 2,267,461,950 | 1,132,898,167 | 3,400,360,117 |
| December 31, 2022 | |||
|---|---|---|---|
| denominated in RON | Level 1 | Level 3 | Total |
| Financial assets at FVTPL – shares | 362,069,218 | 843,576,306 | 1,205,645,523 |
| Financial assets at FVTPL – fund units | 362,939,797 | - | 362,939,797 |
| Financial assets at FVTPL – loan granted | - | 116,912,505 | 116,912,505 |
| Financial assets at FVTPL – bonds | 38,313,018 | - | 38,313,018 |
| Financial assets at FVTOCI – shares | 1,468,597,487 | 155,925,533 | 1,624,523,020 |
| Investment property | 12,963,376 | 12,963,376 | |
| Land and buildings | 3,342,887 | 3,342,887 | |
| 2,231,919,521 | 1,132,720,607 | 3,364,640,128 |
No transfers between the levels of fair value were made during the first three months of 2023.
| denominated in RON | March 31, 2023 | December 31, 2022 |
|---|---|---|
| Sundry debtors | 6,139,726 | 5,297,290 |
| Other financial assets | 3,655,643 | 8,254,666 |
| Impairment for depreciation of sundry debtors | (717,477) | (717,477) |
| Total | 9,077,892 | 12,834,480 |
| denominated in RON | March 31, 2023 | December 31, 2022 |
|---|---|---|
| Balance as of January 1 | 12,963,376 | 12,953,334 |
| Inflows | - | - |
| Outflows | - | - |
| Change of fair value – gain/(loss) | - | 10,042 |
| Balance as of the end of period | 12,963,376 | 12,963,376 |
| denominated in RON | March 31, 2023 | December 31, 2022 |
|---|---|---|
| Debts to employees and related contributions | 798,527 | 2,760,306 |
| Taxes and dues | 13 | 414,346 |
| Suppliers and creditors | 11,326,843 | 11,863,722 |
| Total | 12,125,383 | 15,038,374 |
The item Suppliers and creditors on March 31, 2023, mainly includes the amounts received as an advance for the transfer of unlisted shares.
Deferred tax assets and liabilities on March 31, 2023, and December 31, 2022, are generated by the elements detailed in the following tables:
| denominated in RON | Assets | Liabilities | Net |
|---|---|---|---|
| Financial assets at FVOCI | - | 833,321,624 | (833,321,624) |
| Tangible assets and investment property | - | 13,572,403 | (13,572,403) |
| Total | 846,894,027 | (846,894,027) | |
| Net temporary differences - 16% rate | (846,894,027) | ||
| Deferred tax liabilities | (135,503,045) |
| denominated in RON | Assets | Liabilities | Net |
|---|---|---|---|
| Financial assets at FVOCI | - | 839,844,596 | (839,844,596) |
| Tangible assets and investment property | - | 13,572,403 | (13,572,403) |
| Total | - | 853,416,999 | (853,416,999) |
| Net temporary differences - 16% rate | - | - | (853,416,999) |
| Deferred tax liabilities | - | - | (136,546,721) |
Deferred tax liabilities in balance on March 31, 2023, amounting to RON 135,503,045 (2022: RON 136,546,721) include:
deferred income tax recognized directly through the decrease in equity amounting to RON 129,110,432 (2022: 130,389,332), being generated by reserves for financial assets measured at fair value through other comprehensive income (FVTOCI)
the deferred tax related mainly to the differences from inflation of the financial assets and the impairment adjustments, amounting to RON 6,392,613 recognized in retained earnings (2022: RON 6,157,389).
As of March 31, 2023, the share capital of Lion Capital amounts to RON 50,751,006, divided into 507,510,056 shares with the nominal value of RON 0.1 and it is the result of direct subscriptions to the share capital of the company, by the conversion into shares of the amounts due as dividends under Law no. 55/1995 and pursuant to Law no. 133/1996. As of March 31, 2023, the number of shareholders was of 5,740,306 (December 31, 2022: 5,741,164).
The shares issued by Lion Capital are traded on the Bucharest Stock Exchange since November 1999. The records of shares and shareholders is kept by Depozitarul Central S.A. Bucharest.
All shares are ordinary shares, were subscribed and fully paid as of March 31, 2023 and December 31, 2022. All shares have equal voting rights and a nominal value of RON 0.1/share. The number of shares authorized to be issued is equal to the shares issued.
The EGM of November 2, 2020, approved:
the partial revocation of the Resolution of the Extraordinary General Meeting of Shareholders of April 22, 2019, published in the Official Gazette of Romania, Part IV, no. 2154 / 23.05.2019, namely of article 1 of this resolution, which approved the execution of a buyback program for a maximum of 15,000,000 shares;
the execution of a Buyback ("Program 3") by the Company to reduce its share capital. The maximum number of shares that could be repurchased: 15,000,000 shares at most.
the reduction of Company's share capital from RON 51,542,236.3 to RON 50,751,005.6 following the cancellation of 7,912,307 treasury shares acquired by the company, in the buyback programs.
the execution of a share buyback program ("Program 6") for the distribution free of charge to the members of the Company's management (administrators, directors), in order to gain their loyalty, as well as to reward them for the activity carried out within the Company, according to the performance criteria to be determined by the Board of Directors. The maximum number of shares that can purchased in the buyback program is no more than 990,000 shares. The shares will be distributed within a "Share-based Payment Plan" of Stock Option Type, in compliance with the legislation in force. The Board of Directors of the Company approved in March 2023 the "Share-based Payment Plan", which is ongoing.
| denominated in RON | March 31, 2023 | December 31, 2022 |
|---|---|---|
| Share capital | 50,751,006 | 50,751,006 |
| Total | 50,751,006 | 50,751,006 |
| (b) Retained earnings | ||
| denominated in RON | March 31, 2023 | December 31, 2022 |
| Retained earnings from the transition to IAS and IFRS | 422,323,709 | 422,323,709 |
| Retained earnings from application of IFRS 9 (including gain on transactions) |
332,037,522 | 312,836,518 |
| Undistributed profit | 95,467,147 | - |
| Result for the period | 32,141,147 | 95,467,147 |
| Other amounts recognized in retained earnings (legal reserves, revaluation of tangible assets, etc.) |
2,220,251 | 2,220,252 |
| Total | 884,189,776 | 832,847,626 |
| (c) Other reserves | ||
| denominated in RON | March 31, 2023 | December 31, 2022 |
| Reserves allotted from the net profit | 1,350,359,944 | 1,350,359,944 |
| Reserves set-up under Law no. 133/1996* | 145,486,088 | 145,486,088 |
| Reserves from lapsed dividends | 88,420,910 | 88,420,910 |
| Reserves from exchange rate differences and investment facilities | 19,832,946 | 19,832,946 |
| Total | 1,604,099,887 | 1,604,099,887 |
* The reserve related to the initial portfolio was set-up under Law no. 133/1996, as the difference between the value of the contributed portfolio and the value of the share capital subscribed to the Company. Thus, these reserves are assimilated to a contribution premium and are not used in the sale of non-current financial assets.
Pursuant to the legal requirements, the Company set-up legal reserves in the amount of 5% of recorded profit according to applicable accounting standards up to 20% of the share capital as per the Articles of Association. The legal reserve as of March 31, 2023, amounts to RON 10,150,201 (December 31, 2022: RON 10,150,201). Legal reserves cannot be distributed to shareholders.
This reserve comprises cumulative net changes in the fair values of financial assets measured through other comprehensive income from the date of their classification in this category to the date they have been derecognized or impaired.
Reserves are recorded net of related deferred tax. The amount of deferred tax recognized directly through impairment of equity is shown in Note 17.
The following table shows the reconciliation of net differences in the change in fair value for financial assets measured by other comprehensive income:
| denominated in RON | March 31, 2023 | December 31, 2022 |
|---|---|---|
| Differences from changes in fair value of financial assets measured through other comprehensive income (shares) |
758,970,814 | 741,827,359 |
| Total | 758,970,814 | 741,827,359 |
During the first three months of 2023, there was no approval of a dividend distribution. In 2022 the shareholders of the Company approved the distribution of a gross dividend of RON 0.06/share from the profit for 2021 FY.
The calculation of basic earnings per share was made based on the profit attributable to ordinary shareholders and the weighted average number of ordinary shares:
| denominated in RON | March 31, 2023 | March 31, 2022 |
|---|---|---|
| Profit attributable to ordinary shareholders | 32,141,147 | (36,253,521) |
| Weighted average number of ordinary shares* | 507,072,500 | 507,510,056 |
| Basic earnings per share | 0.0634 | (0.0714) |
* considering repurchased shares
Diluted earnings per share equals basic earnings per share, as the Company did not record potential ordinary shares.
As of March 31, 2023, in the Company's records were 51 litigations ongoing in Courts. The Company had legal standing in 41 lawsuits, passive legal standing in 8 lawsuits, and intervenient in 2 litigations.
In most lawsuits in which the Company acts as plaintiff, the subject of litigation is the cancellation / ascertainment of cancellation of decisions taken by the General Meetings of Shareholders in portfolio companies, or insolvency proceedings of portfolio companies.
not the case
The parties are considered related if one party has the ability to control the other party or to exercise a significant influence over its financial and operational decision making.
The Company has identified the following related parties in the course of business:
March 31, 2023
December 31, 2022
During the period of the interim reporting, there were no transactions carried out and no advances and loans were granted to managers and administrators of the Company, except for work related travel advances.
The Company has not received and has not given guarantees in favour of any related party.
As of March 31, 2023, the Company held (directly and indirectly) majority stakes in 15 companies (December 31, 2022: 15). Following the classification of the Company as an investment entity, the subsidiaries providing investment services for the Company (SAI Muntenia Invest and Administrare Imobiliare) remained in the scope of consolidation, and the other subsidiaries were deconsolidated.
The number of entities in which the Company holds stakes between 20% and 50% of the share capital as of March 31, 2023, is of 16 (December 31, 2022: 16), of which:
a. One entity (Biofarm SA Bucharest), in which the Company exercises significant influence;
b. 4 (December 31, 2022: 4) entities that do not qualify as associates, because the Company does not exercise significant influence in those companies;
c. 11 (December 31, 2022: 11) entities in insolvency / liquidation / bankruptcy.
During the first three months of 2023, the Company made the following transactions with affiliated parties:
| March 31, 2023 | March 31, 2022 | |
|---|---|---|
| Transactions by profit and loss | ||
| Dividend income, of which: | ||
| Vrancart | 865,417 | 440,984 |
| SIF SPV TWO | 1,103,608 | - |
| Total | 1,969,025 | 440,984 |
| Other revenues | ||
| Silvana Cehu Silvaniei - additional liquidation proceeds | 72,694 | - |
| Total | 72,694 | - |
| Other expenses, of which: | ||
| Administrare Imobiliare - rent and operating expenses | 86,514 | 85,134 |
| Gaz Vest – supply of natural gas | - | (350) |
| Total | 86,514 | 84,784 |
| March 31, 2022 | December 31, 2022 | |
|---|---|---|
| Other receivables, of which: | ||
| Vrancart - bonds | 37,612,296 | 37,612,296 |
| Vrancart - interest receivable | 618,102 | 700,722 |
| SIF SPV TWO – principal loan | 115,845,003 | 115,805,211 |
| SIF SPV TWO – interest receivable | 2,716,429 | 1,107,295 |
| Total | 159,399,744 | 157,833,437 |
| Other debts, of which: | ||
| Administrare Imobiliare | 37,571 | 36 |
| Total | 37,571 | 36 |
April 10, 2023 – The company informs investors upon receiving on 04/07/2023 a request to amend the agenda of the ordinary general meeting of shareholders of Lion Capital SA, convened for April 27 (28), 2023, a request made by the shareholder Blue Capital SA, with registered office in the municipality of Bucharest, which owns 9.0423% of the share capital of Lion Capital SA. On April 11, 2023, the Company's Board of Directors amended the agenda of the general meeting of shareholders with the requests received.
April 21, 2023 - The last instalment agreed through the agreement for the transfer of the stake representing 74.53% of the share capital of Central S.A. Cluj-Napoca was collected, at the same time carrying out the transfer of ownership of the shares. This agreement was concluded in February 2021, with a maximum completion period of 30 months (August 2023).
the standalone financial statements and the consolidated financial statements as of December 31, 2022, - the allocation of the profit of 2022, amounting to RON 95,467,148, to Other reserves, as own financing sources,
the discharge of administrators for the activity carried out in 2022 FY,
the income and expenses budget and the Activity Program for 2023 FY,
the remuneration due to the members of the board of directors for 2023 FY, at the level established by the OGM Resolution of April 26, 2016, and the general limits of all the additional remuneration of the members of the board of directors and the general limits of the directors' remuneration for 2023 FY at the level established by the OGM Resolution no. 7 of April 27, 2020.
amendment of the Company's Articles of Association;
the execution of a buyback program ("Program 7"), for distribution free of charge to the members of the Company's management (administrators, directors), in order to build their loyalty, as well as to reward them for the activity carried out within the Company, according to the performance criteria to be established by the Board of Directors. The maximum number of shares that can be repurchased is of 990,000 shares, the minimum (maximum) price per share is of RON 0.1 (RON 6.5747), the duration of Program 7 is a maximum of 18 months from the date of publication of the decision in the Official Gazette of Romania, part of 4th,
the use of the shares purchased under Buyback Program 7, in order to distribute them free of charge to the members of the Company's management (administrators, directors), under a "Stock Option Plan", in compliance with the legislation in force.
| ITEM | VALUE [RON] | ||||
|---|---|---|---|---|---|
| 1 Intangible assets 2 Tangible assets |
54,148 3,640,619 |
||||
| 3 Investment property | 12,963,376 | ||||
| 4 Biological assets | 5 Assets representing rights to use the underlying assets in a leasing contract | - 414,474 |
|||
| 6 Financial assets | 3,265,492,205 | ||||
| 6.1 Financial assets measured at amortized cost | 6.2 Financial assets measured at fair value through profit and loss | - 1,640,958,873 |
|||
| 6.2.1 Shares | 1,229,825,197 | ||||
| 6.2.1.2.1 in Romania | 6.2.1.1 Admitted to trading on a trading venue | 884,095,534 884,095,534 |
|||
| 6.2.1.2.1.1 | Traded in the last 30 trading days | 386,747,497 | |||
| 6.2.1.2.1.2 6.2.1.2.2 in a Member State |
Not traded in the last 30 trading days | 497,348,037 - |
|||
| 6.2.1.2.3 in a third country | - | ||||
| 6.2.1.2 Not admitted to trading | 345,729,662 | ||||
| 6.2.1.2.1 in Romania 6.2.1.2.2 in a Member State |
345,729,662 - |
||||
| 6.2.1.2.3 in a third country | - | ||||
| 6.2.2 Corporate bonds | 6.2.2.1 Admitted to trading on a trading venue | 37,492,902 37,492,902 |
|||
| 6.2.2.1.1 in Romania | 37,492,902 | ||||
| 6.2.2.2.1.1 6.2.2.2.1.2 |
Traded in the last 30 trading days Not traded in the last 30 trading days |
- 37,492,902 |
|||
| 6.2.2.1.2 in a Member State | - | ||||
| 6.2.2.1.3 in a third country 6.2.2.2 Not admitted to trading |
- - |
||||
| 6.2.3 Securities of AIF / UCITS | 373,640,774 | ||||
| 6.2.3.1 Shares 6.2.3.2 Fund units |
- 373,640,774 |
||||
| 6.2.3.2.1 Admitted to trading on a trading venue | - | ||||
| 6.2.3.2.2 Not admitted to trading 6.2.3.2.2.1 |
in Romania | 373,640,774 338,717,234 |
|||
| 6.2.3.2.2.2 | in a Member State | - | |||
| 6.2.3.2.2.3 | in a third country 6.3 Financial assets measured at fair value through other comprehensive income |
34,923,540 1,624,533,332 |
|||
| 6.3.1 Shares | 1,415,836,087 | ||||
| 6.3.1.2.1 in Romania | 6.3.1.1 Addmitted to trading on a trading venue | 1,269,094,073 1,148,336,033 |
|||
| 6.3.1.2.1.1 | Traded in the last 30 trading days | 1,148,212,644 | |||
| 6.3.1.2.1.2 6.3.1.2.2 in a Member State |
Not traded in the last 30 trading days | 123,389 120,758,040 |
|||
| 6.3.1.2.2.1 | Traded in the last 30 trading days | 120,758,040 | |||
| 6.3.1.2.2.2 | Not traded in the last 30 trading days | - | |||
| 6.3.1.2.3 in a third country 6.1.1.2.3.1 |
Traded in the last 30 trading days | ||||
| 6.1.1.2.3.2 | Not traded in the last 30 trading days | ||||
| 6.3.1.2 Not admitted to trading 6.3.1.2.1 in Romania |
146,742,013 146,742,013 |
||||
| 6.3.1.2.2 in a Member State | |||||
| 6.3.2 Corporate bonds | 6.3.1.2.3 in a third country | - | |||
| 6.3.2.1 Admitted to trading on a trading venue | - | ||||
| 6.3.2.1.1 in Romania 6.3.2.2.1.1 |
Traded in the last 30 trading days | - - |
|||
| 6.3.2.2.1.2 | Not traded in the last 30 trading days | - | |||
| 6.3.2.1.2 in a Member State 6.3.2.1.3 in a third country |
- - |
||||
| 6.3.2.2 Not admitted to trading | - | ||||
| 6.3.3 Securities of AIF / UCITS | 6.3.3.1 Shares | 208,697,245 208,697,245 |
|||
| 6.3.3.1 | Admitted to trading on a trading venue | 208,697,245 | |||
| 6.3.3.1.1 | in Romania 6.3.3.1.1.1 Traded in the last 30 trading days |
208,697,245 208,697,245 |
|||
| 6.3.3.1.1.2 Not traded in the last 30 trading days | - | ||||
| 6.3.3.2.2 6.3.3.2.3 |
in a Member State in a third country |
||||
| 6.3.3.2 | Not admitted to trading | - | |||
| 7 Cash available (cash and cash equivalent) | 6.3.3.2 Fund units | - 52,055,215 |
|||
| 8 Bank deposits | 3,240,455 | ||||
| 9 Other assets: 9.1 Dividends or other receivables |
125,036,156 - |
||||
| 9.2 Other assets | 125,036,156 | ||||
| 9.2.1 10 Accrued expenses |
Loans granted subsidiaries | 118,561,432 263,289 |
|||
| 11 Total assets | 3,463,159,938 | ||||
| 12 Total liabilities 12.1 Financial liabilities measured at amortized cost |
158,085,399 22,582,354 |
||||
| 12.2 Deferred income tax liabilities | 135,503,045 | ||||
| 12.3 Other liabilities 13 Provisions for risks and expenses |
- - |
||||
| 14 Deferred income | 701,345 | ||||
| 15 Equity, of which: | 3,307,013,605 | ||||
| 15.1 Share capital 15.2 Items treated as equity |
50,751,006 632,757,735 |
||||
| 15.3 Other components of equity | 759,172,939 | ||||
| 15.4 Premium related to capital 15.5 Revaluation reserves |
- 1,176,569 |
||||
| 15.6 Reserves | 3,574,439,692 | ||||
| 15.7 Treasury shares* 15.8 Retained earnings |
-2,526,773 786,770,849 |
||||
| 15.9 Retained earnings first-time adoption of IAS 29 (debtor account) | -2,527,669,558 | ||||
| 15.10 Result for the period 16 Net Asset Value |
32,141,147 3,304,373,194 |
||||
| 17 Number of outstanding shares** | 506,520,056 | ||||
| 18 Net Asset Value per Share 19 Number of companies in the portfolio, of which: |
6.5237 85 |
||||
| 19.1 Companies admitted to trading on an EU trading venue | 28 | ||||
| 19.2 Companies admitted to trading on a stock exchange in a third country | - |
NOTE
* Value of treasury shares, repurchased under the PTO carried out between February 16 - March 1, 2023
** As per Art. 123, par. (3) of ASF Regulation no. 9/2014, this position presents the number of shares issued by the company and outstanding as of the reporting date, on the basis of which the unit value of the net asset is calculated. Treasury shares at the reporting date are not included. As of the date of this report, out of the total of 507,510,056 issued shares, the company holds 990,000 own shares, repurchased under the PTO carried out between February 16 and March 1, 2023.
This statement is provided as a free translation from Romanian, which is the official and binding version Lion Capital S.A.
Depositary bank Banca Comercială Română
as of 31.03.2023
| No. | Name of the issuer | Tax Indentification Code |
Symbol | No. of shares held |
No./date of valuation report |
RON / share | Total value | Valuation method |
|---|---|---|---|---|---|---|---|---|
| Companies not admitted to trading where LC's stake is> 33% of the share capital | ||||||||
| 1 | AZUGA TURISM | 28330211 | 786,882 369/24.02.2023 | 22.3800 | 17,610,419 | income approach, discounted cash flow method |
||
| 2 | NAPOMAR | 199176 | 10,256,241 366/24.02.2023 | 3.0549 | 31,331,791 | income approach, discounted cash flow method |
||
| 3 | CENTRAL | 199230 | 53,120 372/24.02.2023 | 769.6009 | 40,881,200 | income approach, discounted cash flow method |
||
| 4 | SAI MUNTENIA INVEST | 9415761 | 119,976 367/24.02.2023 | 741.0000 | 88,902,216 | income approach, discounted cash flow method |
||
| 5 | SIF SPV TWO | 40094500 | 119,988 375/27.02.2023 | 98.5248 | 11,821,794 | asset approach, corrected Net Asset method |
||
| 6 | Administrare Imobiliare SA | 20919450 | 16,049,741 371/24.02.2023 | 2.9787 | 47,807,364 | asset approach, corrected Net Asset method |
||
| 7 | SIF1 IMGB | 380430 | 301,078,647 370/24.02.2023 | 0.8107 | 244,084,459 | asset approach, corrected Net Asset method |
||
| Companies admitted to trading with irrelevant liquidity for the application of the mark to market valuation method (according to Art.114 par. (4) of Reg.9 / 2014) | ||||||||
| 8 | SIF Imobiliare PLC | HE323682 | SIFI | 4,499,961 374/27.02.2023 | 81.8680 | 368,402,807 | asset approach, corrected Net Asset method |
|
| 9 | SIF Hoteluri | 56150 | CAOR | 31,820,906 368/24.02.2023 | 2.6598 | 84,637,246 | income approach, discounted cash flow method |
|
| 10 | IAMU | 1766830 | IAMU | 7,286,299 365/24.02.2023 | 6.0810 | 44,307,984 | income approach, discounted cash flow method |
Leverage and exposure calculated in accordance with the provisions of Regulation (EU) no. 231/2013
| Method for calculating AIFRI exposure |
Exposure value | Leverage |
|---|---|---|
| (RON) | (%) | |
| Gross method | 3,300,139,455 | 99.87% |
| Commitment method | 3,304,373,194 | 100 |
| Beginning of the reporting period [28.02.2023] | End of the reporting period [31.03.2023] | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| ITEM | % of net asset |
% of total assets |
Currency | RON | % of net asset |
% of total assets |
Currency | RON | Differences (RON) |
| I Total assets | 105.18 | 100.00 | 202,597,853 | 3,306,869,990 | 104.81 | 100.00 | 171,819,971 3,291,339,966 | -46,307,905 | |
| Securities and money market instruments, of which: 1 |
67.34 | 64.02 | 182,925,600 | 2,063,876,239 | 66.30 | 63.26 | 120,758,040 2,069,924,470 | -56,119,329 | |
| 1.1 Securities and money market instruments admitted or traded on a regulated |
61.85 | 58.81 | - | 2,063,876,239 | 62.64 | 59.77 | - | 2,069,924,470 | 6,048,231 |
| 1.1.1 shares | 60.74 | 57.75 | 2,026,673,657 | 61.51 | 58.69 | 2,032,431,568 | 5,757,910 | ||
| 1.1.2 other securities assimilated to these | - | - | - | - | - | - | - | - | 0 |
| 1.1.3 corporate bonds | 1.11 | 1.06 | - | 37,202,582 | 1.13 | 1.08 | - | 37,492,902 | 290,321 |
| 1.1.4 other debt securities | - | - | - | - | - | - | - | - | 0 |
| 1.1.5 other securities | - | - | - | - | - | - | - | - | 0 |
| 1.1.6 money market instruments | - | - | - | - | - | - | - | - | 0 |
| 1.2 Securities and money market instruments admitted or traded on a regulated |
|||||||||
| market in a member state | 5.48 | 5.21 182,925,600.00 | - | 3.65 | 3.49 | 120,758,040 | - | -62,167,560 | |
| 1.2.1 shares | 5.48 | 5.21 | 182,925,600 | - | 3.65 | 3.49 | 120,758,040 | - | -62,167,560 |
| 1.2.2 other securities assimilated to these | - | - | - | - | - | - | - | - | 0 |
| 1.2.3 corporate bonds | - | - | - | - | - | - | - | - | 0 |
| 1.2.4 other debt securities | - | - | - | - | - | - | - | - | 0 |
| 1.2.5 other securities | - | - | - | - | - | - | - | - | 0 |
| 1.2.6 money market instruments | - | - | - | - | - | - | - | - | 0 |
| Securities and money market instruments admitted on a stock exchange in a 1.3 |
|||||||||
| third country or negotiated on another regulated market in a third country, that | |||||||||
| operates on a regular basis and is recognized and open to the public, approved | - | - | - | - | - | - | - | - | 0 |
| by ASF, of which: | |||||||||
| Newly issued securities 2 |
- | - | - | - | - | - | 0 | ||
| 3 Other securities and money market instruments |
14.80 | 14.07 | - | 493,687,107 | 14.90 | 14.22 | - | 492,471,676 | -1,215,431 |
| 4 Bank deposits, of which: |
0.09 | 0.08 | - | 2,869,293 | 0.10 | 0.09 | - | 3,240,455 | 371,162 |
| 4.1 bank deposits with credit institutions in Romania; | 0.09 | 0.08 | - | 2,869,293 | 0.10 | 0.09 | - | 3,240,455 | 371,162 |
| 4.2 bank deposits with credit institutions in a Member State; | - | - | - | - | - | - | - | - | 0 |
| 4.3 bank deposits with credit institutions in a third country. | - | - | - | - | - | - | - | - | 0 |
| 5 Derivatives traded on a regulated market |
- | - | - | - | - | - | 0 | ||
| 6 Current accounts and cash | 0.60 | 0.57 | 19,672,253 | 386,008 | 1.58 | 1.50 | 51,061,931 | 993,284 | 31,996,955 |
| 7 Money market instruments other than those traded on a regulated market, as referred |
|||||||||
| to in Art. 82(g) of GEO no. 32/2012 - Repo contracts on securities | - | - | - | - | - | - | - | - | 0 |
| 8 Equity securities of AIF/UCITS (RO: FIA/OPCVM) of which: | 17.98 | 17.09 | - | 599,787,741 | 17.62 | 16.82 | - | 582,338,020 | -17,449,722 |
| 8.1 AIF shares | 215,684,604 | 208,697,245 | -6,987,359 | ||||||
| 8.2 UCITS fund units | 384,103,137 | 373,640,774 | -10,462,363 | ||||||
| 9 Dividends or other rights receivable | - | - | - | - | - | - | - | - | 0 |
| Other assets (amounts in transit, amounts with distributors, with brokers, etc.). 10 |
4.38 | 4.17 | - | 146,263,603 | 4.31 | 4.11 | - | 142,372,062 | -3,891,540 |
| Loans granted to subsidiaries 10.1 |
3.52 | 3.34 | 117,313,439 | 3.59 | 3.42 | 118,561,432 | 1,247,992 | ||
| II Total liabilities | 5.18 | 4.92 | - | 172,729,724 | 4.81 | 4.59 | - | 158,786,744 | -13,942,980 |
| 1 Expenses for the payment of fees due to AIFM |
- | - | - | - | - | - | - | - | 0 |
| 2 Expenses for the payment of fees due to depositary bank |
- | - | - | - | - | - | - | - | 0 |
| 3 Expenses for the payment of fees due to intermediaries |
- | - | - | - | - | - | - | - | 0 |
| 4 Expenses on turnover fees and other banking services |
- | - | - | - | - | - | - | - | 0 |
| 5 Interest expenses |
- | - | - | - | - | - | - | - | 0 |
| 6 Issuance expenses |
- | - | - | - | - | - | - | - | 0 |
| 7 Expenses with the payment of commissions/fees due to ASF |
- | - | - | - | - | - | - | - | 0 |
| 8 Financial audit costs |
- | - | - | - | - | - | - | - | 0 |
| 9 Other approved expenses / liabilities |
5.18 | 4.92 | - | 172,729,724 | 4.81 | 4.59 | - | 158,786,744 | -13,942,980 |
| 10 Redemptions payable | - | - | - | - | - | - | - | - | 0 |
| III Net Asset Value (I-II) | 100.00 | 95.08 | 202,597,853 | 3,134,140,267 | 100.00 | 95.41 | 171,819,971 3,132,553,223 | -32,364,925 |
Table 2
| RON | |||
|---|---|---|---|
| ITEM | Current period | Corresponding period of the previous year | Differences |
| Net Asset Value | 3,304,373,194 | 3,270,800,865 | 33,572,329 |
| Number of fund units / shares outstanding | 506,520,056 | 507,510,056 | -990,000 |
| Net asset value per share | 6.5237 | 6.4448 | 0.0789 |
I. Securities admited or traded on a regulated market in Romania
| 1. Shares traded in the last 30 trading days (business days) | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| No. Issuer | Symbol | Date of last trading session |
No. of shares held | Nominal value |
Value of share |
Total value | Stake of issuer's share capital |
Weight in AIFRI total assets |
|
| RON | RON | RON | % | % | |||||
| 1 | BANCA TRANSILVANIA | TLV | 31.03.2023 | 33,803,379 | 10.00 | 19.5000 | 659,165,891 | 4.7768 | 19.03 |
| 2 | BIOFARM | BIO | 31.03.2023 | 362,096,587 | 0.10 | 0.6420 | 232,466,009 | 36.7471 | 6.71 |
| 3 | OMV PETROM | SNP | 31.03.2023 | 355,081,206 | 0.10 | 0.4605 | 163,514,895 | 0.5698 | 4.72 |
| 4 | BRD - GROUPE SOCIETE GENERALE | BRD | 31.03.2023 | 13,615,497 | 1.00 | 11.8800 | 161,752,104 | 1.9537 | 4.67 |
| 5 | VRANCART | VNC | 31.03.2023 | 908,612,549 | 0.10 | 0.1680 | 152,646,908 | 75.5047 | 4.41 |
| 6 | GRAND HOTEL BUCHAREST | RCHI | 29.03.2023 | 249,998,583 | 0.10 | 0.2940 | 73,499,583 | 29.9923 | 2.12 |
| 7 | CONPET | COTE | 31.03.2023 | 562,740 | 3.30 | 75.4000 | 42,430,596 | 6.5000 | 1.23 |
| 8 | BURSA DE VALORI BUCURESTI | BVB | 31.03.2023 | 410,637 | 10.00 | 47.2000 | 19,382,066 | 5.1016 | 0.56 |
| 9 | IMPACT DEVELOPER & CONTRACTOR | IMP | 31.03.2023 | 21,700,000 | 0.25 | 0.3680 | 7,985,600 | 0.9173 | 0.23 |
| 10 ANTIBIOTICE | ATB | 31.03.2023 | 14,167,736 | 0.10 | 0.5540 | 7,848,926 | 2.1104 | 0.23 | |
| 11 ARGUS | UARG | 30.03.2023 | 1,790,432 | 1.50 | 3.0400 | 5,442,913 | 5.0039 | 0.16 | |
| 12 SATURN | SATU | 24.03.2023 | 346,926 | 2.50 | 6.5000 | 2,255,019 | 17.5385 | 0.07 | |
| 13 PRIMACONSTRUCT | PCTM | 09.03.2023 | 90,685 | 2.50 | 21.0000 | 1,904,385 | 15.6969 | 0.05 | |
| 14 SIFI CJ LOGISTIC | CACU | 31.03.2023 | 54,486 | 2.50 | 30.0000 | 1,634,580 | 5.5275 | 0.05 | |
| 15 ARCELOR MITTAL HUNEDOARA | SIDG | 21.03.2023 | 5,921,324 | 0.10 | 0.2300 | 1,361,905 | 2.9820 | 0.04 | |
| 16 SOMETRA | SOMR | 22.03.2023 | 1,217,602 | 2.50 | 0.5700 | 694,033 | 2.0786 | 0.02 | |
| 17 PETROCART | PTRC | 29.03.2023 | 11,852,163 | 0.50 | 0.0475 | 562,978 | 30.1767 | 0.02 | |
| 18 UCM | UCM | 30.03.2023 | 1,068,613 | 0.10 | 0.3900 | 411,750 | 0.9721 | 0.01 | |
| TOTAL | 1,534,960,141 | 44.32 |
2. Shares not traded in the last 30 trading days (working) or measured by valuation methods
| No. Issuer | Symbol | Date of last trading session |
No. of shares held | Nominal value |
Value of share |
Total value | Stake of in issuer's share capital |
Weight in AIFRI total assets |
|
|---|---|---|---|---|---|---|---|---|---|
| RON | RON | RON | % | % | |||||
| 1 | SIF IMOBILIARE | SIFI | 14-Aug-20 | 4,499,961 | 4.47 | 81.8680 | 368,402,807 | 99.9997 | 10.64 |
| 2 | SIF HOTELURI | CAOR | 28-Feb-23 | 31,820,906 | 2.50 | 2.6598 | 84,637,246 | 98.9997 | 2.44 |
| 3 | IAMU | IAMU | 27-Feb-23 | 7,286,299 | 2.50 | 6.0810 | 44,307,984 | 76.6967 | 1.28 |
| 4 | INDUSTRIA SARMEI CAMPIA TURZII | INSI | 2-Nov-22 | 4,604,082 | 0.10 | 0.0268 | 123,389 | 1.2497 | 0.00 |
| 5 | ICSH | ICSH | 26-Mar-22 | 84,500 | 2.50 | 0.0000 | 0 1.2891 |
0.00 | |
| 6 | SIFI UNITEH | UNIT | 12-Aug-20 | 158,573 | 2.50 | 0.0000 | 0 36.3399 |
0.00 | |
| 7 | TALC DOLOMITA | TALD | 9-Oct-15 | 167,108 | 2.50 | 0.0000 | 0 7.8944 |
0.00 | |
| TOTAL | 497,471,427 | 14.36 |
3. Shares not traded in the last 30 trading days (working days) for which the financial statements are not obtained within 90 days from the legal date of submission
4. Preference rights / allocation rights
5. Bonds admitted to trading issued or guaranteed by authorities of local public administration / corporate bonds
| No | Issuer | Bond symbol Date of last trading session |
No. of bonds held | Date of acquisition |
Date of coupon |
Date of coupon maturity |
Initial value | Daily increase | Cummulative interest |
Discount / Premium |
Market price | Total value | Weight in total issued bonds |
Weight in AIFRI total assets |
|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| RON | RON | RON | RON | RON | RON | % | % | ||||||||
| 1 | VRANCART ADJUD | VNC24 | 31.10.2019 | 368,748 | 17-Mar-17 | 25-Jan-23 | 24-Apr-23 | 36,874,800 | 9,365 | 618,102 | - | 102.00 | 37,492,902 | 96.41 | 1.08 |
| TOTAL | 37,492,902 | 1.08 |
6. Bonds admitted to trading issued or guaranteed by central government authorities
Not the case
Not the case
Not the case
7. Other securities admited to trading on a regulated market Not the case
8. Amounts being settled for securities admitted or traded on a regulated market in Romania
| Issuer | Type of security | Symbol | Valuer per unit | No. of. traded securities |
Total value | Stake of issuer's share capital/total bonds of a issuer |
Weight in AIFRI total assets |
|---|---|---|---|---|---|---|---|
| RON | RON | % | % | ||||
| PROFESSIONAL IMO PARTNERS | shares held | PPLI | 2.08 | 1 | 2 - |
0.00 | |
| TOTAL | 2 | 0.0000 |
| Issuer | ISIN code | Date of last trading session |
No. of shares held | Nominal value* | Value of share | NBR currency rate EUR/RON |
Total value | Stake in issuer's share capital |
Weight in AIFRI total assets |
|---|---|---|---|---|---|---|---|---|---|
| foreign currency | foreign currency | RON | RON | % | % | ||||
| ERSTE GROUP BANK AG | EBS | 31.03.2023 | 800,000 | 0 | 30.50 | 4.9491 | 120,758,040 | 0.1861 | 3.49 |
| TOTAL | 120,758,040 | 3.49 |
2. Bonds admitted to trading issued or guaranteed by authorities of local public administration , corporate bonds Not the case
Not the case
4. Other securities admitted to trading on a regulated market of a Member State
Not the case
III. Securities admitted or traded on a regulated market in a third country
1. Shares traded during last 30 trading days (business days)
2. Bonds admitted to trading issued or guaranteed by authorities of local public administration,
corporate bonds, traded during last 30 days
3. Othes securities admitted to trading on a regulated market in a third country
4. Amounts under settlement for securities admitted or traded on a regulated market in a third country
Not the case Amounts under settlement for money market instruments admitted or traded on a regulated market in Romania V. Money market instruments admitted or traded on a regulated market in another Member State
Not the case Amounts under settlement for money market instruments admitted or traded on a regulated market in another Member State
Not the case Amounts under settlement for money market instruments admitted or traded on a regulated market in a third country VII. Newly issued securities
1. Newly issued shares
2. Newly issued bonds
3. Preference rights (after registration to central dpository, before admitted to trading)
| Nr. crt. | Issuer | No. of shares held | Nominal value | Value of share | Total value | Stake in issuer's share capital |
Weight in AIFRI total assets |
|---|---|---|---|---|---|---|---|
| RON | RON | RON | % | % | |||
| 1 | SIF 1 IMGB | 301,078,647 | 2.50 | 0.8107 | 244,084,459 | 99.92 | 7.05 |
| 2 | SAI MUNTENIA INVEST | 119,976 | 10.00 | 741.0000 | 88,902,216 | 99.98 | 2.57 |
| 3 | ADMINISTRARE IMOBILIARE | 16,049,741 | 2.50 | 2.9787 | 47,807,364 | 97.40 | 1.38 |
| 4 | CENTRAL | 53,120 | 10.00 | 769.6009 | 40,881,200 | 74.53 | 1.18 |
| 5 | NAPOMAR | 10,256,241 | 2.50 | 3.0549 | 31,331,791 | 99.43 | 0.90 |
| 6 | AZUGA TURISM | 786,882 | 17.50 | 22.3800 | 17,610,419 | 98.94 | 0.51 |
| 7 | SIF SPV TWO | 119,988 | 1.00 | 98.5248 | 11,821,794 | 99.99 | 0.34 |
| 8 | EXIMBANK | 414,740 | 6.00 | 11.6778 | 4,868,633 | 0.31 | 0.14 |
| 9 | DEPOZITARUL CENTRAL | 9,878,329 | 0.10 | 0.1272 | 1,256,523 | 3.91 | 0.04 |
| 10 | CCP.RO BUCHAREST | 142,500 | 10.00 | 8.2273 | 1,172,390 | 1.64 | 0.03 |
| 11 | SPUMOTIM | 12,398 | 2.50 | 44.8802 | 556,425 | 3.99 | 0.02 |
| 12 | MOBIROM | 11,589 | 2.50 | 45.9594 | 532,623 | 9.03 | 0.02 |
| 13 | AMIS MOB | 12,607 | 2.50 | 35.2467 | 444,355 | 8.12 | 0.01 |
| 14 | FORESTIERA | 42,269 | 2.50 | 7.9537 | 336,195 | 25.75 | 0.01 |
| 15 | CTCE | 8,501 | 2.50 | 30.3505 | 258,010 | 23.24 | 0.01 |
| 16 | COMMETCAR | 14,862 | 2.50 | 14.1659 | 210,534 | 10.00 | 0.01 |
| 17 | STREIUL | 9,344 | 2.50 | 16.6637 | 155,706 | 17.44 | 0.00 |
| 18 | APRO HOREA | 8,220 | 2.50 | 18.1147 | 148,903 | 13.54 | 0.00 |
| 19 | AUTODANUBIUS | 11,653 | 2.50 | 6.0318 | 70,289 | 14.04 | 0.00 |
| 20 | MODERN | 3,302 | 2.50 | 6.6166 | 21,848 | 2.45 | 0.00 |
| 21 | BANCA COMERCIALA ROMANA | 1 | 0.10 | 0.6900 | 1 - |
0.00 | |
| 22 | AGROINDUSTRIALA INEU | 59,755 | 2.50 | 0.0000 | 0 11.50 |
0.00 | |
| 23 | AGROINDUSTRIALA NADLAC | 66,406 | 2.50 | 0.0000 | 0 30.00 |
0.00 | |
| 24 25 |
AGROPRODUCT RESITA | 72,720 | 2.50 | 0.0000 | 0 30.00 |
0.00 | |
| 26 | ARCER | 83,213 | 2.50 | 0.0000 | 0 19.70 |
0.00 | |
| 27 | ARIO | 3,523,021 | 3.70 | 0.0000 | 0 93.64 |
0.00 | |
| 28 | AVERSA | 142,699 | 2.50 | 0.0000 | 0 2.14 |
0.00 | |
| 29 | BANCA INTERNATIONALA A RELIGIILOR | 186,849 | 1.00 | 0.0000 | 0 0.93 |
0.00 | |
| 30 | BRAFOR COMAR |
5,928,744 40,601 |
0.10 2.50 |
0.0000 0.0000 |
0 2.69 0 34.94 |
0.00 0.00 |
|
| 31 | COMBINATUL DE UTILAJ GREU | 409,572 | 4.00 | 0.0000 | 0 5.02 |
0.00 | |
| 32 | COMMIXT | 10,543 | 2.50 | 0.0000 | 0 28.97 |
0.00 | |
| 33 | CONTOR GROUP | 2,900,049 | 0.10 | 0.0000 | 0 1.50 |
0.00 | |
| 34 | CUART | 4,516 | 2.50 | 0.0000 | 0 3.40 |
0.00 | |
| 35 | ELBAC | 8,299,560 | 0.10 | 0.0000 | 0 32.45 |
0.00 | |
| 36 | ERGOLEMN | 9,637 | 2.50 | 0.0000 | 0 12.96 |
0.00 | |
| 37 | EXFOR | 399,654 | 2.50 | 0.0000 | 0 24.23 |
0.00 | |
| 38 | FORTPRES - CUG | 103,523 | 2.50 | 0.0000 | 0 1.36 |
0.00 | |
| 39 | IFOR | 101,803 | 2.50 | 0.0000 | 0 15.35 |
0.00 | |
| 40 | IPEGM | 291,560 | 2.50 | 0.0000 | 0 3.40 |
0.00 | |
| 41 | LASPERESIA | 20 | 2.50 | 0.0000 | 0 1.95 |
0.00 | |
| 42 | LEMN-MOL-FA | 37,146 | 2.00 | 0.0000 | 0 13.02 |
0.00 | |
| 43 | MEBIS | 346,637 | 2.50 | 0.0000 | 0 26.78 |
0.00 | |
| 44 | MINIERA CUART | 17,396 | 2.50 | 0.0000 | 0 3.40 |
0.00 | |
| 45 | MOPAL | 251,067 | 80.45 | 0.0000 | 0 21.89 |
0.00 | |
| 46 | PROIECT | 2,162 | 8.00 | 0.0000 | 0 10.00 |
0.00 | |
| 47 | ROSTRAMO | 434,501 | 2.50 | 0.0000 | 0 10.04 |
0.00 | |
| 48 | SANEVIT | 535,217 | 0.10 | 0.0000 | 0 8.97 |
0.00 | |
| 49 | SILVANA | 1,443,772 | 2.50 | 0.0000 | 0 96.28 |
0.00 | |
| 50 | SIMATEC | 42,886 | 2.50 | 0.0000 | 0 18.82 |
0.00 | |
| 51 | SOMES | 1,653,350 | 2.10 | 0.0000 | 0 13.12 |
0.00 | |
| 52 | TEHNOLOGIE MOBILA STIL | 9,000 | 2.50 | 0.0000 | 0 4.55 |
0.00 | |
| 53 | TRANSILVANIA AIUD | 46,779 | 2.50 | 0.0000 | 0 20.19 |
0.00 | |
| 54 | TREMULA | 66,112 | 2.50 | 0.0000 | 0 17.99 |
0.00 | |
| 55 | TREMULA BRAILA | 17,465 | 2.50 | 0.0000 | 0 13.46 |
0.00 | |
| 56 | UZINA ARDEALUL | 55,593 | 2.50 | 0.0000 | 0 29.51 |
0.00 | |
| TOTAL | 492,471,676 | 14.22 |
2. Shares traded under systems other than regulated markets
Not the case
| Issuer | No. of shares held | Nominal value | Valuer per unit | Total value | Stake of issuer's share capital/total bonds of a issuer |
Weight in AIFRI total assets |
|---|---|---|---|---|---|---|
| MOLIDUL | 90,579 | 2.50 | 0.00 | 0.00 | 21.63 | 0.00 |
| TOTAL | 0,00 | 0,000 |
Not the case
5. Amounts being settled for shares traded on a other systems than regulated market Not the case
1. Commercial papers Not the case
| No. | Bank name | Present value | Weight in total assets of AIFRI |
|---|---|---|---|
| RON | % | ||
| 1 | Banca TRANSILVANIA | 961,792 | 0.03 |
| 2 | Intesa SanPaolo | 20,468 | 0.00 |
| 3 | CEC Bank | 3,312 | 0.00 |
| 4 | BRD-G.S.G | 2,457 | 0.00 |
| 5 | Banca Comerciala Romana | 2,428 | 0.00 |
| 6 | Eximbank | 1,889 | 0.00 |
| 7 | Unicredit Bank | 123 | 0.00 |
| 8 | SIF Banat-Crisana - petty cash | 814 | 0.00 |
| TOTAL | 993,284 | 0.03 | |
| No. | Bank name | Present value | NBR exchange rate | Present value in RON | Weight in total assets of AIFRI |
|---|---|---|---|---|---|
| foreign currency | % | ||||
| 1 | BRD-G.S.G | 2,900,000.76 | 4.9491 | 14,352,393.76 | 0.41 |
| 2 | Banca Comerciala Romana | 7,399,094.50 | 4.9491 | 36,618,858.59 | 1.06 |
| 3 | Banca Transilvania | 17,570.24 | 4.9491 | 86,956.87 | 0.00 |
| 4 | Eximbank | 2.74 | 4.9491 | 13.56 | 0.00 |
| TOTAL | 51,058,222.79 | 1.47 |
3. Current accounts and cash, denominated in USD
| No. | Bank name | Present value | NBR exchange rate | Present value in RON | Weight in total assets of AIFRI |
|---|---|---|---|---|---|
| foreign currency | % | ||||
| 1 | Banca Transilvania | 301.30 | 4.5463 | 1,369.80 | 0.00 |
| 2 | Banca Comercială Română | 254.18 | 4.5463 | 1,155.58 | 0.00 |
| TOTAL | 2,525.38 | 0.00 |
4. Current accounts and cash, denominated in GBP
| No. | Bank name | Present value | NBR exchange rate | Present value in RON | Weight in total assets of AIFRI |
|---|---|---|---|---|---|
| foreign currency | % | ||||
| 1 | Banca TRANSILVANIA | 210.28 | 5.6256 | 1,182.95 | 0.00 |
| TOTAL | 1,182.95 | 0.00 |
X. Bank deposits by separate categories: set up at credit institutions in Romania / in another Member State / in a third country
| Nr. crt. | Denumire bancă | Set up date | Maturi ty date | Initial value | Daily increase | Accrued interest | Total value | Weight in total assets of AIFRI |
|---|---|---|---|---|---|---|---|---|
| RON | RON | RON | RON | % | ||||
| Banca Comercială Română | ||||||||
| 1 | 31.03.2023 | 03.04.2023 | 3,240,000 | 454.50 | 454.50 | 3,240,455 | 0.09 | |
| TOTAL | 3,240,455 | 0.09 |
| No. | Bank name | Set up date | Maturity date | Initial value | Daily increase | Accrued interest | NBR exchange rate EUR/RON |
Total value | Weight in total assets of AIFRI |
|---|---|---|---|---|---|---|---|---|---|
| currency | currency | currency | RON | RON | % | ||||
| 1 | |||||||||
| No. | Fund name | Date of last trading session |
No. of securities held (shares/fund units) |
Value of equity security(NAV/unit) |
Market price | Total value | Weight in UCITS/AIF's total equity securities |
Weight in total assets of AIFRI |
|---|---|---|---|---|---|---|---|---|
| RON | RON | RON | % | % | ||||
| Shares | ||||||||
| 1 | SIF MUNTENIA | 31-Mar-23 | 140,663,575 | 1.1700 | 164,576,383 | 17.9270 | 4.75 | |
| 2 | SIF OLTENIA | 31-Mar-23 | 25,801,674 | 1.7100 | 44,120,863 | 5.1603 | 1.27 | |
| Fund units | ||||||||
| 1 | Fondul Inchis de Investitii ACTIVE PLUS | 15,050.2178 | 13,616.2300 | 204,927,227 | 76.4216 | 5.92 | ||
| 2 | FIA CERTINVEST ACTIUNI | 307.6000 | 275,578.8700 | 84,768,060 | 59.3654 | 2.45 | ||
| 3 | FIAIP OPTIM INVEST | 3,494.6900 | 11,154.0700 | 38,980,017 | 48.1472 | 1.13 | ||
| 4 | ROMANIA STRATEGY FUND Klasse B | 58,000.0000 | 602.1300 | 34,923,540 | 50.8772 | 1.01 | ||
| 5 | FIA STAR VALUE | 9,382.0000 | 1,070.3400 | 10,041,930 | 25.3150 | 0.29 | ||
| TOTAL | 582,338,020 | 16.82 |
2. Equity securities denominated in foreign currency
Not the case
3. Amounts under settlement for equity securities denominated in RON
| Fund name | Market price | No. of securities traded |
Total value | Weight in UCITS/AIF's total equity securities |
Weight in total assets of AIFRI |
|---|---|---|---|---|---|
| RON | RON | % | % | ||
4. Amounts under settlement for equity securities denominated in foreign currency Not the case
| No. | Issuer | Share symbol | Ex-dividend date | No. of shares held | Gross dividend | Amount receivable | Weight in total assets of AIFRI |
|---|---|---|---|---|---|---|---|
| RON | RON | % | |||||
| 1 | GAZ VEST | 01.07.2021 | 105,068 | 2,607,914 | 0.00 | 0.00 | |
| TOTAL | - | 0.00 |
Not the case
| Issuer | Share symbol | Ex-dividend date | No. of shares held | Share value | Total value* | Weight in total assets of AIFRI |
|---|---|---|---|---|---|---|
| RON | RON | % | ||||
* recalculated as per art.120, p.(1) of ASF Regulation no. 9/2014
Not the case
| Issuer of shares | Share symbol | Ex-dividend date | No. of preemtive rights |
Theoretical value of preference rights |
Total value |
|---|---|---|---|---|---|
| TOTAL | 0 | 0 |
Evolution of the net asset value and net asset value per share in the last reporting periods
| 31.03.2023 | Feb. .2023 | Jan. 2023 | |
|---|---|---|---|
| Net asset value | 3,304,373,194 | 3,336,738,119 | 3,229,171,842 |
| Net asset value per share | 6.5237 | 6.5747 | 6.3628 |
The valuation methods used for the financial instruments for which valuation methods have been chosen in accordance with the valuation standards in force, according to the law are the following: For the companies: IAMU, NAPOMAR, SAI MUNTENIA INVEST, CENTRAL, SIF HOTELURI, AZUGA TURISM income approach, discounted cash flow method was used; For the companies: SIF 1 IMGB, ADMINISTRARE IMOBILIARE, SIF IMOBILIARE, SIF SPV TWO the asset approach, the corrected Net Asset method was used
Leverage and exposure value as per Regulation (EU) no. 231/2013
| Method for calculating | Exposure value | Leverage |
|---|---|---|
| AIFRI exposure | (RON) | (%) |
| Gross method | 3,300,139,455 | 99.87% |
| Commitment method | 3,304,373,194 | 1.00 |
Certification of Depositary Bank, Lion Capital S.A. Banca Comercialã Românã
May 15, 2023, Arad | Lion Capital (the new corporate name starting March 24, 2023, of SIF Banat-Crișana) informs the investors that the quarterly report prepared as of March 31, 2023, pursuant to the provisions of Law no. 24/2017, Law no. 74/2015, Law no. 243/2019, ASF Regulation no. 10/2015, ASF Regulation no. 5/2018, ASF Regulation no. 7/2020, and ASF Rule no. 39/2015, is available to the public starting May 15, 2023, at 18:00 hours, at Company's headquarters and on Company's website at www.lion-capital.ro
Note that the financial statements as of March 31, 2023, are not audited.
Further information can be obtained from Investor Relations Office, tel/fax +40257 304 446 +40257 250 165, e-mail [email protected]
Bogdan-Alexandru Drăgoi Chairman and CEO
Compliance Officer, Eugen Cristea
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