Annual Report • May 15, 2009
Annual Report
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CIMPOR is an international cement Group - ranked among the world's top ten - with head office and decision centre in Portugal. At the end of 2008 the Group was operating in thirteen countries spread over four continents, managing an installed cement production capacity of 31.1 million tonnes/year (employing its own clinker).
The Group's core business is the production and sale of cement. It is the domestic market leader in Portugal, Cape Verde and Mozambique. Concrete, aggregates and mortars are produced and sold as a consequence of vertical integration of the businesses. These products generated a consolidated turnover of EUR 2.089 billion in 2008.
The CIMPOR Group, as a pioneer in the concept of sustainable development and one of the world's main players in the movement towards consolidation of the sector, aims to continue on the path of growth and internationalization, remaining loyal to that concept whilst maintaining its independence from other large cement producers and keeping its decision centre in Portugal.
| Consolidated Data | Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|---|
| Installed Capacity (Cement) (1) | 103 ton |
31,070 | 28,360 | 9.6 % | 24,115 | |
| Group Sales | ||||||
| Cement and Clinker | 103 ton |
26,807 | 24,547 | 9.2 % | 20,445 | |
| Concrete | 103 m3 |
8,567 | 8,664 | -1.1 % | 6,943 | |
| Aggregates | 103 ton |
16,109 | 15,196 | 6.0 % | 12,987 | |
| Mortar | 103 ton |
562 | 543 | 3.4 % | 485 | |
| Turnover | 106 euros |
2,088.9 | 1,966.1 | 6.2 % | 1,638.9 | |
| Payroll Expenses | 106 euros |
224.9 | 207.1 | 8.6 % | 173.2 | |
| Operating Cash Flow (EBITDA ) | 106 euros |
586.3 | 607.0 | -3.4 % | 563.0 | |
| Operating Income (EBIT) | 106 euros |
392.6 | 438.1 | -10.4 % | 408.1 | |
| Financial Income (net) | 106 euros |
-134.4 | -48.0 | s.s. | -42.3 | |
| Current Income | 106 euros |
258.3 | 390.1 | -33.8 % | 365.8 | |
| Net Income after Minority Interests | 106 euros |
219.4 | 304.1 | -27.8 % | 291.9 | |
| Total Assets | 106 euros |
4,615.3 | 4,834.0 | -4.5 % | 3,857.8 | |
| Shareholders' Equity | 106 euros |
1,505.1 | 1,796.4 | -16.2 % | 1,579.7 | |
| Minority Interests | 106 euros |
110.7 | 102.9 | 7.6 % | 74.1 | |
| Net Financial Debt (2) | 106 euros |
1,862.6 | 1,359.3 | 37.0 % | 865.6 | |
| Capital Employed | 106 euros |
3,382.5 | 3,214.6 | 5.2 % | 2,547.1 | |
| Capital Invested | 106 euros |
3,703.2 | 3,498.4 | 5.9 % | 2,763.0 | |
| Employees (31 Dec) | units | 8,369 | 7,608 | 10.0 % | 5,950 | |
| Turnover / Employee | 103 euros |
256.5 | 279.5 | -8.2 % | 279.3 | |
| Value Added / Employee | 103 euros |
99.6 | 115.7 | -13.9 % | 125.5 | |
| Net Investment | ||||||
| Goodwill (Subsidiaries) | 106 euros |
166.6 | 332.9 | -49.9 % | 14.5 | |
| Tangible Fixed Assets | 106 euros |
423.7 | 498.8 | -15.1 % | 166.1 | |
| Operating CF / Turnover (EBITDA Margin) | 28.1% | 30.9% | 34.4% | |||
| Operating Income / Turnover (EBIT Margin) | 18.8% | 22.3% | 24.9% | |||
| Return on Equity (ROE ) | 13.3% | 18.1% | 18.9% | |||
| Return on Equity Employed (ROCE ) (3) | 10.4% | 11.6% | 13.1% | |||
| Net Financial Debt / Capital Invested | 50.3% | 38.9% | 31.3% | |||
| Market Capitalization (31 Dec) | 106 euros |
2,339 | 4,032 | -42.0 % | 4,227 | |
| Earnings per Share (EPS ) | euros | 0.33 | 0.45 | -27.4 % | 0.44 | |
| Price (31 Dec) / Price Earnings Ratio (PER) | 10.6 | 13.2 | 14.4 |
KEY FINANCIALS
(1) Annual capacity of ccement production w ith ow n clinker (31 Dec)
(2) Loans Contracted (including Leasing and Added Costs deriving from Financial Debt) - Liquid assets, Tradable securities and other Financial Applications
(3) Adjusted Operating Income (net of Cash Taxes) / Capital Employed
Award to Cimpor Indústria de Cimentos, S.A., of certification of its Occupational Health and Safety Management System according to the OHSAS 18001 standard.
Continuation of the registration of Cimpor Indústria de Cimentos, S.A. in the EMAS (Eco-Management and Audit Scheme) and validation of the respective "2007 Interim Environmental Statement".
• Conclusion of the merger process, by incorporation of the companies Yibitaş Holding, A.S. and Cimpor Yibitaş Muhendislik Makina Sanayi ve Ticaret, A.S. into Cimpor Yibitaş Çimento Sanayi ve Ticaret A.Ş..
• Start up of operations at the Simuma plant of a new clinker production line of 1,500 tons/day and the start of construction of a new clinker silo with a 40 ton capacity, at the same plant.
| Chairman: | Ricardo Manuel Simões Bayão Horta |
|---|---|
| Members: | Luís Eduardo da Silva Barbosa |
| Jacques Lefèvre | |
| Jean Carlos Angulo * | |
| Jorge Manuel Tavares Salavessa Moura * | |
| Luís Filipe Sequeira Martins * | |
| Manuel Luís Barata de Faria Blanc * | |
| Pedro Maria Calaínho Teixeira Duarte * | |
| Vicente Árias Mosquera | |
| José Manuel Baptista Fino | |
| José Enrique Freire Arteta | |
* Executive Committee
| Chairman: Members: |
Ricardo José Minotti da Cruz Filipe Luís Black Freire d'Andrade Jaime de Macedo Santos Bastos |
|---|---|
| Alternate Member: | João José Lopes da Silva |
| Statutory Auditor | Deloitte & Associados, SROC, S.A., represented by João Luis Falua Costa da Silva |
| General Meeting | |
| Chairman: | Miguel António Monteiro Galvão Teles |
|---|---|
| Vice-Chairman: | Luís Manuel de Faria Neiva dos Santos |
| Secretary: | Jorge Manuel da Costa Félix Oom | ||
|---|---|---|---|
| Alternate Secretary: | Armindo Oliveira das Neves |
| • Profile of the CIMPOR Group • Key Financials • Corporate Highlights • Governing Bodies |
1 6 |
|---|---|
| DECLARATION OF CONFORMITY (pursuant to Article 245(1) c) of the Securities' Code) |
11 |
| CORPORATE GOVERNANCE REPORT | 13 |
| 0. Declaration of Compliance 0.1. Recommendations Adopted and not Adopted 0.2. Comply or Explain |
15 15 17 |
| 0.2.1. Blocking shares in the event of suspension of the General Meeting 0.2.2. Independence of the Chairman of the Audit Committee 0.2.3. Declaration on Remuneration Policy |
17 18 18 |
| 0.2.4. One Representative of the Remuneration Committee attending the Annual General Meeting 0.2.5. Disclosure of Individual Remunerations |
19 19 |
| 0.2.6. Existence of a Performance Assessment Committee and a Committee to Evaluate the Adopted Governance System 0.2.7. Independence of the Members of the Remuneration Committee |
20 20 |
| I. General Meeting I.1. General Meeting Board I.2. Participation in the General Meeting and Exercising Voting Rights |
21 21 21 |
| I.3. The Company's Remuneration Policy and Assessment of the Board of Directors I.4. Measures of Corporate Control |
23 23 |
| II. Management and Supervisory Bodies II.1. Governing Bodies II.1.1. Audit Committee and Statutory Auditor II.1.2. Board of Directors II.1.2.1. Overview of the Board of Directors II.1.2.2. Method of Functioning of the Management Body II.1.3. Governance Model II.1.4. Committees with Management and Supervisory Powers II.1.4.1. Executive Committee |
25 25 25 27 28 29 32 32 32 |
| II.1.4.2. Internal Consultative Committee on Corporate Governance and Social Responsibility II.2. Organizational Structure II.2.1. CIMPOR Group II.2.2. CIMPOR Holding II.2.3. Shared Services II.2.4. Cimpor Tec |
33 36 36 37 39 40 |
| II.3. Internal Control and Risk Management | 41 |
|---|---|
| II.4. Remuneration | 43 |
| II.4.1. Remuneration Committee | 43 |
| II.4.2. Remuneration Policy and Disclosure of Remunerations | 43 |
| II.5. Policy on the Reporting of Irregularities | 46 |
| II.6. Codes of Conduct of the Governing Bodies | 47 |
| III. Information III.1. Share Capital and Shareholder Structure III.2. Amendments to the Articles of Association III.3. Performance of CIMPOR shares on the Stock Exchange III.4. Dividend Distribution Policy III.5. Stock Purchase and Stock Option Plans III.5.1. Employee Stock Purchase Plan for 2008 III.5.2. CIMPOR Stock Option Plan for the Group's Directors and Management – 2008 Series III.5.3. Options Granted, Exercised and Extinguished III.6. Business and Operations between the Company and Members of its Management and Supervisory Bodies, Shareholders of Qualifying Holdings or Companies in a Control or Group Relationship III.7. Investor Relations Office III.8. External Auditor |
48 48 49 49 51 52 53 53 54 55 56 57 |
| Annex I - Members of the Management and Supervisory Bodies | 59 |
| Annex II – Acquisition of Own Shares | 68 |
| Group Activity | 73 |
| 1. Macroeconomic and Sectoral Background | 74 |
| 1.1. Evolution of the World Economy | 74 |
| 1.2. Evolution of the Cement Sector | 75 |
| 2. Internationalization and Corporate Growth | 76 |
| 2.1. India | 76 |
| 2.2. China | 76 |
| 2.3. Spain | 76 |
| 2.4. Other Business Areas | 78 |
| 3. Review of the Group's Results | 79 |
| 3.1. Summary of the Overall Business | 79 |
| 3.2. Portugal | 87 |
| 3.3. Spain | 88 |
| 3.4. Morocco | 89 |
| 3.5. Tunisia | 91 |
| 3.6. Egypt | 92 |
| 3.7. Turkey | 93 |
| 3.8. Brazil | 94 |
| 3.9. Mozambique | 96 |
| 3.10. South Africa | 97 |
| 3.11. Cape Verde | 98 |
| 3.12. China | 99 |
| 3.13. India | 100 |
| 3.14. Other Areas | 101 |
| 4. CIMPOR TEC's Business | 102 |
| 5. Sustainability and Social Responsibility 5.1. Sustainable Development 5.2. Social Responsibility |
104 104 106 |
|---|---|
| 6. Human Resources | 107 |
| 7. Occupational Health and Safety | 110 |
| 8. Financial and Risk Management Policy 8.1. Financial Debt Management 8.2. Risk Management Policy 8.2.1. Financial Risk Management 8.2.2. Asset Risk Management |
112 112 115 115 116 |
| 9. Outlook for 2009 9.1. Overview 9.2. CIMPOR Group |
117 117 117 |
| 10. Post Balance Sheet Events | 120 |
| CONSOLIDATED FINANCIAL STATEMENTS | 123 |
| • Consolidated Statement of Profit and Loss for the Financial Years Ending 31 December 2008 and 31 December 2007 |
124 |
| • Consolidated Balance Sheet at 31 December 2008 and 31 December 2007 |
125 |
| • Consolidated Statement of Cash Flows for the Financial Years Ending 31 December 2008 and 31 December 2007 |
126 |
| • Consolidated Statement of Recognised Income and Expenses for the Financial Years Ending 31 December 2008 and 31 December 2007 • Notes to the Consolidated Financial Statements as at 31 December 2008 • Holders of Qualifying Shareholdings • Shares Held by Members of Management and Audit Bodies • Report and Opinion of the Audit Committee • Declaration of Conformity (pursuant to Article 245 (1)c) of the Portuguese Securities' Code) • Statutory Audit Certificate and Auditor's Report |
127 128 227 228 241 245 247 |
| INDIVIDUAL REPORT AND ACCOUNTS FOR 2008 | 249 |
| I – DIRECTORS' REPORT | 251 |
| 1. Summary of the Business 2. Legal Information 3. Post Balance Sheet Events 4. Outlook for 2009 |
252 252 253 253 253 |
| II – FINANCIAL STATEMENTS OF THE HOLDING COMPANY | 255 |
|---|---|
| • Balance Sheet at 31 December 2008 and 31 December 2007 |
256 |
| • Statement of Profit and Loss for the Financial Years Ending 31 December 2008 and 31 December 2007 |
257 |
| • Statement of Change in Shareholder's Equity for the years Ended 31 December 2008 and 2007 |
258 |
| • Statement of Cash Flows for the Financial Years Ending 31 December 2008 and 31 December 2007 |
259 |
| • Notes to the Financial Statements as at 31 December 2008 |
261 |
| • Report and Opinion of the Audit Committee |
283 |
| • Statutory Audit Certificate and Auditor's Report |
285 |
(pursuant to Article 245(1)c) of the Securities' Code)
As far as we are aware: the information set forth in Article 245(1)c) of the Portuguese Securities' Code was drawn up in conformity with applicable accounting standards, providing an accurate and appropriate image of the assets and liabilities, the financial situation and the profits of CIMPOR – Cimentos de Portugal, SGPS, S.A. and the companies included in the consolidation perimeter (CIMPOR Group), The directors' report faithfully provides an account of the evolution of the business, the performance and the position of the CIMPOR Group and it contains a description of the main risks and uncertainties facing it.
Lisbon, 24 April 2009
Ricardo Manuel Simões Bayão Horta
Luís Eduardo da Silva Barbosa Jacques Lefèvre
Pedro Maria Calaínho Teixeira Duarte Vicente Árias Mosquera
Jean Carlos Angulo Jorge Manuel Tavares Salavessa Moura
Luís Filipe Sequeira Martins Manuel Luís Barata de Faria Blanc
José Manuel Baptista Fino José Enrique Freire Arteta
(THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY)
CIMPOR – Cimentos de Portugal, SGPS, S.A. ("CIMPOR" or "the Company") has, for a long period of time, been committed to dealing appropriately with issues related to the corporate governance of companies issuing shares admitted to trading on a regulated market, as well as the periodic disclosure to stakeholders, the wider financial community, the authorities and the market in general of the positions and solutions the Group adopts in this area.
As in previous years, the Board of Directors presents the more significant aspects of Corporate Governance and of the Group in this chapter of its annual report. The publication of this information ensures compliance with the information disclosure duties established by the Portuguese Securities' Code and the Regulation no. 1/2007 of the Portuguese Securities' Market Commission (Comissão do Mercado de Valores Mobiliários - CMVM).
CIMPOR has always attached special importance to the adoption of the best organizational models and the most suitable practices and guidelines concerning Corporate Governance. In doing so, it seeks to remain aligned with the main international trends and encourage critical reflection within the company.
CIMPOR, in line with the importance it allocates such matters, in addition to complying with the corporate governance rules set forth in the Portuguese Companies' Code, nowadays maintains a significant degree of compliance with the recommendations envisaged in the CMVM's recently approved "Corporate Governance Code" (which is available from this entity's site, at www.cmvm.pt).
CIMPOR's compliance with the referred to recommendations can be summarised as follows:
| Recommendation | Compliance | Ref. | |
|---|---|---|---|
| General Meeting | |||
| General Meeting Board | |||
| Adequate resources available to the Chairman of the General | |||
| I.1. | |||
| I.1. | |||
| Participation in the General Meeting | |||
| 1. | Prior period for the deposit or blocking of shares | COMPLIES | I.2. |
| DOES NOT | |||
| 0.2.1. | |||
| Voting and Exercising Voting Rights | |||
| 1. | Absence of statutory restrictions on postal votal | COMPLIES | I.2. |
| 2. | Time limit for receiving voting ballots by mail | COMPLIES | I.2. |
| 3. | "One share, one vote" principle | COMPLIES | I.2. |
| 1. | Quorum not exceeding legal limits | COMPLIES | I.2. |
| Minutes and Information of Resolutions Passed | |||
| 1. | Made available on the Company's website | COMPLIES | I.1. |
| 1. | Absence of measures to prevent the success of takeover bids | COMPLIES | I.4. |
| 2. | Absence of restrictions on the number of votes | N/A | I.4. |
| 3. | Absence of defensive measures | COMPLIES | I.4. |
| Management and Supervisory Bodies | |||
| 1. | Structure and Powers | ||
| 1.1. Assessment of the governance model by the management | |||
| body | COMPLIES | II.1.3. | |
| 1.2. Internal control systems to detect risks | COMPLIES | II.3. | |
| 1.3. Internal regulations | COMPLIES | II.6. | |
| 1. 2. 2. |
Meeting Board Disclosure of the remuneration of the Chairman of the General Meeting Board Blocking shares in the event of suspension of the General Meeting Quorum and Resolutions Measures of Corporate Control General |
COMPLIES COMPLIES COMPLY |
| Recommendation | Compliance | Ref. | ||
|---|---|---|---|---|
| 2. | Incompatibilities and Independence | |||
| 2.1. Number of non-executive directors | COMPLIES | II.1.2.1. | ||
| 2.2. Number of independent non-executive directors | COMPLIES | II.1.2.1. | ||
| 3. | Elegibility and Appointment | |||
| 3.1. Independence of the Chairman of the Audit Committee | DOES NOT | 0.2.2. | ||
| COMPLY | II.1.1. | |||
| 4. | Irregularities' Reporting Policy | |||
| 4.1. Adoption of an irregularities' reporting policy | COMPLIES | II.5. | ||
| 4.2. Disclosure of the general guidelines | COMPLIES | II.5. | ||
| 5. | Remuneration | |||
| 5.1. Aligned to the interests of the Company' | COMPLIES | II.4.2. | ||
| DOES NOT | ||||
| 5.2. Statement on remuneration policy 5.3. At least one representative of the Remuneration Committee |
COMPLY DOES NOT |
0.2.3. | ||
| attends the Annual General Meeting | COMPLY | 0.2.4. | ||
| 5.4. Plans for the award of shares and/or share options | COMPLIES | III.5. | ||
| DOES NOT | ||||
| 5.5. Disclosure of individual remunerations | COMPLY | 0.2.5. | ||
| II.2. | Board of Directors | |||
| 1. | Delegation of the day-to-day management of the Company | COMPLIES | II.1.2.2. | |
| 2. | The Company pursues its goals and limits exist to the delegation of powers |
COMPLIES | II.1.2.2. | |
| 3. | Coordination of the work of the non-executive board members | N/A | II.1.2.1. | |
| 4. | Disclosure of the activities of the non-executive board members | COMPLIES | II.1.2.2. | |
| 5. | Rotation of the board member responsible for financial matters | COMPLIES | II.1.4.1. | |
| II.3. | Executive Board | |||
| 1. | Provision of information to the other members of the governing | COMPLIES | II.1.2.2. | |
| 2. | bodies Send the notices to convene meetings and the minutes of meetings |
II.1.4.1. | ||
| to the Chairmen of the Board of Directors and the Audit Committee | COMPLIES | II.1.4.1. | ||
| 3. | Send the notices to convene meetings and the minutes of meetings to the | |||
| Chairmen of the General and Supervisory Board and the Financial Matters | ||||
| Committee | N/A | II.1.4.1. | ||
| II.4. | Audit Committee | |||
| 1. | Duties of the General and Supervisory Board | N/A | II.1. | |
| 2. | Disclosure of the annual report on the website of the Company | COMPLIES | II.1.1. | |
| 3. | Description of the supervisory activity in the annual report | COMPLIES | II.1.1. | |
| 4. | Representation of the Company before the external auditor | COMPLIES | II.1.1. | |
| 5. | Assessment and proposal for the discharge of the external auditor | COMPLIES | II.1.1. | |
| II.5. | Special Committees | |||
| 1. | Existence of a performance assessment committee and a committee | DOES NOT | 0.2.6. | |
| to evaluate the adopted governance system | COMPLY | II.1.4.2. | ||
| DOES NOT | ||||
| 2. | Independence of the members of the remuneration committee | COMPLY | 0.2.7. | |
| 3. | Minutes | COMPLIES | II.1.4.1. | |
| II.1.4.2. | ||||
| II.4.1. | ||||
| III. | Information and Auditing | |||
| III.1. | General Disclosure Obligations | |||
| 2. | Investor support office | COMPLIES | III.7. | |
| 3. | Disclosure of information in English on the Company's website | COMPLIES | III.7. |
CIMPOR is not bound by nor has it voluntarily agreed to comply with any other corporate governance code.
CIMPOR has been analysing, subsequent to the approval in September 2007 of the CMVM's Corporate Governance Code, the recommendations contained in that Code so that the Company may adopt the practices most suited to fostering the transparency and accountability of its governance model and practices.
In its appraisal CIMPOR regarded such recommendations not on the basis of a rigid model – where one size fits all – but as a set of practices to be considered in the light of the Company's individual features, i.e. tailor made, and empowering a balanced composition of the interests of its shareholders and other stakeholders.
Some of these recommendations are, for a range of reasons, still not complied with or are not wholly complied with, to wit:
Recommendation I.2.2: Should the General Meeting be suspended, the company shall not compel share blocking during the period until the meeting is resumed; the company shall limit such blocking to that ordinarily required prior to an initial meeting.
CIMPOR's articles of association do not contain any provision expressly on the blocking of its shares in the event of the suspension of the General Meeting. Nonetheless, paragraph 3 and 4 of article 7 establish that shareholders intending to take part in the General Meeting will have to keep their shares registered in their name until the closing of the same and, therefore, the fact that the shares must remain blocked and they cannot be traded until the close of the meeting means that compliance with this recommendation is not deemed to exist.
Furthermore, this matter will undergo discussion during 2009 in the context of the transposition of Directive 2007/36/EC of the European Parliament and of the Council, of 11 July 2007, relative to the exercise of certain rights by the shareholders of listed companies (and which has a transposition deadline of 3 August 2009). Accordingly, the blocking method will be replaced by the "registration date" method envisaged in that Directive.
Recommendation II.1.3.1: Depending on the applicable model, the Chairman of the Audit Board, the Audit Committee or the Financial Matters Committee shall be independent and be adequately empowered to carry out his/her duties.
The Chairman of the Audit Committee is adequately empowered to perform the role's duties, considering his qualifications and constancy in the Company, in that role, since March 1992.
CIMPOR does not fully comply with this recommendation since the Chairman of the Audit Committee is not deemed to be independent in the light of article 414(5)b) of the Portuguese Companies' Code. The decision to not accommodate this recommendation is chiefly based on two reasons.
Firstly, it is deemed, in the case under analysis, that the performance of a role since that date ddoes not jeopardise the capacity of those performing such roles to be impartial. It is CIMPOR's opinion that the criteria for remaining in the post should be merely indicative, to be appraised on a case-by-case basis, as is proposed in point 13 – under the heading of "Independence" – of the European Commission's Recommendation of 15 February 2005, relative to the role of non-executive directors or members of the supervisory board of listed companies and of the committees of the board of directors or supervisory board. It is, in fact, stated in that point that, in view of the specific circumstances of the person or company, the competent body considers a certain member to be independent even when remaining linked to the company for more than 3 terms of office or 12 years.
Secondly, for an industrial company, as is the case of CIMPOR, it is especially important that the Audit Committee contains a member who knows the Company business and its reality. Based on the fact that this body already has independent members in the majority, one of which has audit and accounting powers, it is our understanding that the committee's chairman should be someone with solid knowledge of the Company's business. This fact, in CIMPOR's opinion, must take precedence over the "seniority" criteria set forth in the recommendation in question.
Recommendation II.1.5.2: The Remuneration Committee and the Board of Directors shall submit a statement on the remuneration policy of the Management and Supervisory bodies and other directors to the Annual Shareholders General Meeting for appraisal, as provided for in Article 248-B(3) of the Portuguese Securities' Code. The shareholders shall be informed of the criteria and main factors to be used in the assessment of performance for determining the variable component of remuneration, whether share bonuses; share purchases options, annual bonuses or other awards.
CIMPOR has chosen not to submit a statement on the remuneration policy of the members of the governing bodies (whether to comply with the CMVM's former recommendation no. 8-A , or with the current recommendation II.1.5.2.), since it considers that the shareholders, by depositing the responsibility for defining such policy in a Remuneration Committee, have conferred said committee with total autonomy in such matters.
It is the understanding of the current Board of Directors in relation to the other managers that , since it is at the end of its term of office, it should not submit a statement on the future remuneration of the policy of such managers to the next Annual General Meeting where a new board of directors is to be elected.
Recommendation II.1.5.3: At least one representative of the Remuneration Committee must attend the Annual General Meeting of shareholders.
The presence of a member of the Remuneration Committee at the Company's Annual General Meetings is not deemed to be justified, to now, for the reasons referred to in the previous point.
Recommendation II.1.5.5: The remuneration of the members of the Management and Supervisory Boards shall be individually and annually disclosed and, information on fixed and variable remuneration must be discriminated as well as any other remuneration received from other companies within the group of companies or companies controlled by shareholders of qualifying holdings.
This recommendation has not been adopted. This is mainly because it is understood that the shareholders, by opting pursuant to Article 399(1) of the Companies Code and Article 16(2) of the Articles of Association, to appoint a committee to set the remuneration of the Board members, instead of this being established by the shareholders' general meeting, did so with an objective which, implying some reservation, is not compatible with any public disclosure of individual remuneration. Furthermore, since Portuguese law holds that shareholders are sovereign in this matter, they can always decide otherwise if they deem that not enough information is being made available, and state on an individual basis as provided for by Chapter II item no. II.20 of the Annex to CMVM Regulation 1/2007.
Recommendation II.5.1: Unless the company is of a reduced size and depending on the adopted model, the Board of Directors and the General and Supervisory Board shall set up the necessary Committees to: i) ensure that a competent and independent assessment of the Executive Directors' performance is carried out, as well as assess overall performance and the performance of all existing Committees; ii) study the adopted governance system and verify its effectiveness and propose to the competent bodies measures to be implemented with a view to its improvement.
The Company fully complies with point ii) of recommendation II.5.1., since it has an Internal Consultative Committee of the Board of Directors on Corporate Governance and Social Responsibility that has been fully functioning since 2002, and which performs the referred to functions, among others.
The Company does not, in relation to the first part of that recommendation, deem it appropriate to endow that Committee or any other that may be set up within the management body with specific duties concerning the assessment of governing bodies.
Accordingly, the shareholders of CIMPOR decided to create a Remuneration Committee which, through the process of determining the remuneration, ensures a competent and independent assessment of the performance of the executive directors and the overall performance of the Board of Directors and its internal committees. It does not seem to make sense, based on the specific features of the Company and taking into account this option of the shareholders, to overlap duties, as would be the case with the creation of such a committee in the management body to perform an identical role.
Moreover, the Company affords the Remuneration Committee permanent access to external consultants in several spheres of expertise, at its own expense. Thus, the Committee is equipped with the necessary means to ensure the competent performance of the referred to assessment duties.
Recommendation II.5.2: The members of the remuneration committee or equivalent must be independent from the members of the Board of Directors.
In relation to this recommendation on the independence of the members of the Remuneration Committee from the members of the Board of Directors, the fact that this recommendation has not been fully complied with given that one of its members is held to not be independent from one of the Board members, pursuant to item II.19 of Chapter II of the Annex to CMVM Regulation 1/2007, is explained by the fact that said member is in a minority within this Committee and so any conflict of interest that might arise is adequately safeguarded.
The General Meeting Board of CIMPOR is currently composed of the following members:
| Appointment date |
Term of office in progress |
||
|---|---|---|---|
| Chairman | Miguel António Monteiro Galvão Teles | 20/02/2001 | 2005-2008 |
| Vice-Chairman | Luís Manuel Faria Neiva dos Santos | 11/05/2007 | 2005-2008 |
Neither one of the members is in any situation of incompatibility as set forth in article 414-A(1) of the Companies Code, and both are considered independent in the light of the requirements envisaged in article 414(5) of the same Code.
The Chairman of the General Meeting Board relies on the support of the Vice-Chairman and the Company Secretary, within their respective legal powers, to convene and conduct the General Meetings. The Chairman is further provided the logistics support and human resources that are vital to the good performance of the role, particularly where contact with shareholders and the guarantee of the correct running of the General Meetings is concerned. Accordingly, the Company considers recommendation I.1.1 to be fully complied with.
The remuneration of the Chairman of the General Meeting Board takes the form of an attendance fee, which currently stands at EUR 1,000.
The Company, in harmony with recommendation I.5.1, publishes the minutes of the meetings of the General Meeting of the preceding three years on its website (together with the respective agenda and simple attendance statistics). Additionally, it has also been CIMPOR's practice to immediately disclose a summary of the resolutions adopted in the respective General Meetings.
CIMPOR has implemented an ongoing policy of motivating shareholders to exercise their voting rights by facilitating the participation and exercise of voting rights in the General Meeting (particularly postal voting), and by reducing the number of shares required by a shareholder to attend (and vote) at General Meetings.
In accordance with that established in article 7 of the articles of association and in conformity with recommendation I.2.1, the General Meeting is composed of shareholders with the right to vote. Hence, only those shareholders holding at least one share registered in their name on the fifth work day prior to the date set for the General Meeting in which the shareholder intends to participate, and provided that such shares remain registered in the shareholder's name until the Meeting is closed, are legitimately entitled to take part in the general meetings. To participate, the shareholders shall send the statement issued by the respective financial intermediary to the Chairman of the General Meeting, which proves that at least on the fifth work day prior to the date set for the General Meeting such shares were registered in their name and they are also blocked and cannot be traded until the General Meeting is closed.
As referred to above, CIMPOR has already provided for the principle of "one share, one vote" in its Articles of Association (article 7(2)), with the aim of motivating the active exercise of voting rights. This fact ensures that CIMPOR is in conformity with recommendation I.3.3. of the CMVM.
According to article 7(5) of the articles of association, in the event of co-ownership of shares, only the common representative or its representative shall participate in the meetings of the General Meeting.
CIMPOR's articles of association do not establish higher than legally established quorum for the sitting of meetings or voting, and they neither envisage any system of highlighting equity rights. Accordingly, the Company fully complies with recommendation I.4.1.
CIMPOR's articles of association do not establish any restriction on postal voting rights, in conformity with recommendation I.3.1. The procedures to be taken and the applicable time limits are set forth in article 7(6), according to which any shareholder wishing to vote by post must ensure that the Chairman of the General Meeting receives, on or before the second work day prior to the date set for the General Meeting, the explanation of vote on each item of the meeting's agenda (in conformity with recommendation I.3.2.).
Shareholders must use voting ballots that clearly and unambiguously express their voting intention. They can use the draft voting ballot available on the Company's website or request it in writing, addressed to the Chairman of the General Meeting (such request must be received on or before the eighth work day prior to the date set for the General Meeting). CIMPOR has made a draft ballot form available on the internet for voting purposes, though it will accept any ballot form that clearly and unmistakably expresses the shareholder's wishes.
Furthermore, article 7(6) of the articles of association establishes that postal votes are deemed negative votes in relation to resolution proposals submitted subsequent to the issue date of postal votes.
The notices convening General Meetings also set out the rules under law and the articles of association relative to participation and the exercise of voting rights, in order to motivate shareholder participation in such Meetings. Such rules include, in particular:
• Shareholders may be represented by third parties, and, to that end, they must ensure reception of the necessary instruments of representation by the Chairman of the General Meeting by 5:00 pm of the third work day prior to the date set for the respective General Meeting;
Given the current concentration of CIMPOR's shareholder structure, the use of electronic means for voting at Shareholders' General Meetings, other than those mechanisms available over the Internet, has not been deemed necessary.
In summary: The establishment of the "one share, one vote" principle means that compliance with the deadlines for proving the right to participate and vote in the General Meeting is the only restriction established by the articles of association on the exercise of the right to vote.
The General Meeting has not, to date, intervened in any way in the Company's remuneration policy, essentially due to the fact that it has appointed a committee to set the remuneration of the governing bodies and this committee is implicitly tasked with carrying out the respective assessment.
Nonetheless, the shareholders have always undertaken a general appraisal of the Companys Board of Directors in the General Meetings, pursuant to article 376 of the Companies-Code, and that assessment similarly presupposes the appraisal of the members of the Board of Directors.
There are no measures whatsoever, in the Articles of Association or elsewhere, liable to interfere with the success of a takeover bid. There are no other defensive measures aimed at seriously eroding the Company's worth in the event of a shift in control or change in the composition of the Board of Directors, thus ensuring compliance with CMVM recommendation I.6.1. and I.6.3.
Specifically: no shareholder holds any special rights; and the articles of association do not envisage any restriction to the number of votes that can be held or exercised by a single shareholder, and therefore recommendation I.6.2 does not apply to CIMPOR.
There is neither any significant agreement to which the Company is a party and which, in the event of any change in control of the Company, would come into force, be amended or cease to be in effect.
There are also no agreements between the Company and the members of CIMPOR's Board of Directors or senior management (as interpreted under article 248-B(3) of the Securities' Code) that envisage the payment of compensation in the event of resignation, dismissal without just cause or severance of their employment contract with the Company, in the wake of a change in control of the Company.
The governing bodies of CIMPOR are the General Meeting, the Board of Directors, the Audit Committee and the Statutory Auditor.
Pursuant to article 6(2) of the articles of association, the members of the governing bodies are appointed for a four-year term of office, and they may be re-elected.
An Audit Committee and by a Statutory Auditor or a Firm of Statutory Auditors, elected in the General Meeting are responsible for the supervision of the Company, in accordance with article 17 of the articles of association;
The Audit Committee is composed of three members in office and an alternate member. If the General Meeting does not indicate the Chairman of the Audit Committee then such will be appointed by the committee members from among their number. The Statutory Auditor or a Firm of Statutory Auditors is appointed following proposal by the Audit Committee.
The current composition of the Audit Committee is:
| Appointment date |
Term of office in progress |
||
|---|---|---|---|
| Chairman | Ricardo José Minotti da Cruz Filipe | 31/03/1992 (3) | 2005-2008 |
| Members | Luís Black Freire d'Andrade (1) | 11/05/2007 | 2005-2008 |
| Jaime Macedo Santos Bastos (1) (2) | 11/05/2007 | 2005-2008 | |
| Alternate | João José Lopes da Silva (1) | 09/05/2008 | 2005-2008 |
(1) Independent member.
(2) Moved from Alternate Member to Sitting Member on 28/01/2008.
(3) The Chairman of the Audit Committee already held the office of Chairman of the Supervisory Committee of CIMPOR – Cimentos de Portugal E.P. from 12/02/1987.
CIMPOR's Statutory Auditor is currently Deloitte & Associados, SROC, S.A., represented by João Luís Falua Costa da Silva.
There are no specific rules regarding the replacement of members of the Audit Committee. The Company's Articles of Association only provides for the change to the number of members (within statutory limits) during a term of office. If an extra member is appointed, the term of office of the member(s) elected by such means shall coincide with that of the other members already in office.
The Audit Committee is governed by the regulations available for viewing on CIMPOR's website (at www.cimpor.pt), which establish inter alia the scheme applying to the incompatibility of its members, which solely refers the requirements set forth in article 414- A(1) of the Companies' Code (according to which the members of this governing body may not hold management of supervisory roles in five companies).
All the members of the Audit Committee comply with the incompatibility rules established in article 414-A(1) of the Companies' Code.
As above-stated, the majority of members of the Audit Committee are independent, with respect to the provision of article 414(5) of the Companies' Code. The member of the Committee, Jaime Macedo Santos Bastos, has auditing and accountancy specific qualifications.
The Audit Committee of CIMPOR, with regard to section 0.4. of CMVM Regulation no. 1/2007, established mechanisms in its internal regulations that allow it to evaluate the independence of its members and the compliance by the same with the rules on incompatibility in law, at the time of appointment and also at any other subsequent time. Owing to these mechanisms, the gauging by that body of the independence and incompatibility of its members, underpinning the information contained in this report, is based on the information provided by said members, having the range of situations envisaged in article 414(5) and 414-A of the Companies' Code as a reference.
The Chairman of the Audit Committee has powers that are adequate to the performance of that office, in accordance with CMVM recommendation II.1.3.1.. Notwithstanding, CIMPOR does not, as already stated above, agree with the provisions of that recommendation relative to the classification of the Chairman as "not independent", in the light of article 414(5)b) of the Companies' Code, due to the fact that said Chairman has held office for more than 3 terms.
The Audit Committee, according to article 6 of the Audit Committee Regulations and in conformity with applicable legislation and recommendations II.4.2., II.4.3., II.4.4. and II.4.5., performs inter alia the following duties relative to the statutory auditing of the accounts and auditing of the Company:
Proposing the external auditors hiring, renewal of the contract and remuneration;
Ensuring that the external auditor is afforded adequate conditions for the provision of its services within the Company and the companies with which it has a group or control relationship;
The Audit Committee held 13 meetings during 2008 and the minutes of the meetings were drawn up.
The Board of Directors, pursuant to article 11 of the articles of the association, is composed of five to fifteen members, one of whom is chairman and the others are members. The Board of Directors is elected by the General Meeting, which also appoints the chairman (who is allocated the casting vote pursuant to article 11(3) of the articles of the association).
| Appointment date |
Term of office in progress |
||
|---|---|---|---|
| Chairman | Ricardo Manuel Simões Bayão Horta (1) | 31/07/2001 | 2005-2008 |
| Members | Luís Eduardo da Silva Barbosa (1) | 31/07/2001 | 2005-2008 |
| Jacques Lefèvre | 31/07/2001 | 2005-2008 | |
| João Carlos Angulo (2) | 31/07/2001 | 2005-2008 | |
| Jorge Manuel Tavares Salavessa Moura (1) (2) | 31/07/2001 | 2005-2008 | |
| Luís Filipe Sequeira Martins (2) | 12/02/1987 (4) | 2005-2008 | |
| Manuel Luís Barata de Faria Blanc (2) | 31/07/2001 | 2005-2008 | |
| Pedro Maria Calaínho Teixeira Duarte (3) | 31/07/2001 | 2005-2008 | |
| Vicente Árias Mosquera | 31/07/2003 | 2005-2008 | |
| José Manuel Baptista Fino | 27/04/2005 | 2005-2008 | |
| José Enrique Freire Arteta | 27/04/2005 | 2005-2008 |
The Board of Directors is currently composed of eleven members:
(1) Member of Internal Consultative Committee on Corporate Governance and Social Responsibility
(2) Member of the Executive Committee
(3) Chairman of the Executive Committee
(4) Date of appointment as member of the Management Board of CIMPOR – Cimentos de Portugal, E.P.
The Board of Directors is elected by list (the vote is solely for the lists) and one member may be elected from persons proposed on lists. The list must contain at least the name of the persons eligible for the post. Each list is endorsed and submitted by groups of shareholders representing at least 10% and no more than 20% of the share capital. A shareholder may only endorse one list. Should there be such a proposal, the director in question is elected separately and prior to the election of the others. If more than one group submits a list, they will be voted on jointly.
Pursuant to the Regulations of the Board of Directors of CIMPOR, which can be viewed on the website of CIMPOR (at www.cimpor.pt), only article 14 provides for, in the event of any incapacity or incompatibility of any member subsequent to appointment as a director, which would have impeded such appointment, and where the director does not cease to perform such role or remove the supervening incompatibility within thirty days, the Audit Committee to declare the term of that office.
The articles of association do not establish any specific rules regarding the replacement of members of the Board of Directors. The articles of association only provide for (ii) the change to the number of members (within statutory limits) during a term of office (see article 6) and (ii) rules concerning substitution in the event of permanent absence (see article 11).
According to Article 11(6) of the articles of association, three successive absences or five absences, spread over the course of a term of office, from meetings of the Board of Directors by any member of the Board, without justification accepted by the Board proper, will lead to the Board declaring the respective director to be in definitive absence.
Furthermore, pursuant to article 13 of the Board of Directors Regulations, a director deemed to be in definitive absence will be replaced, as follows:
The same provision also provides for, in the event of permanent impediment to the Chairman, the Board of Directors to proceed, in harmony with its full powers to represent and manage the Company, with the appointment of a director from among its number that will temporarily take on the office of Chairman until a new Chairman of the Board of Directors is appointed at the subsequent meeting of shareholders.
If an extra election is held or substitution occurs, the term of office of the member(s) thus elected shall coincide with that of the other directors.
The Board of Directors, in harmony with CMVM recommendation II.1.2.1. includes a number of non-executive members guaranteeing the effective supervision, monitoring and assessment of the activity of the executive members. Thus, the majority of the current members of the Board of Directors of CIMPOR (six out of a total of eleven), including the Chairman, are non-executive directors.
The non-executive directors include three independent directors, pursuant to Article 414(5) of the Companies' Code:
The directors Jacques Lefèvre, José Manuel Baptista Fino and José Enrique Freire Arteta, despite being proposed and elected in the General Meeting on an individual basis and they do not exercise their respective offices in representation of any particular shareholder, are not considered to be "independent non-executive directors" since they hold or have recently held management positions in companies with shareholdings in CIMPOR exceeding 2% (Grupo Lafarge, Investifino - Investimentos e Participações, SGPS, S.A., and Bipadosa, S.A., respectively).
For the purpose of section 0.4. of the Annex to CMVM Regulation no. 1/2007, the assessment of the independence of the Company's directors, underpinning the information contained in this report, is based on the information they provide, with the range of situations envisaged in the abovementioned legislation as a reference.
Consequently, more than one-quarter of the members of the Board of Directors (three out of eleven) are independent non-executive directors, which is deemed to be an appropriate total – considering CIMPOR's size and its shareholder structure – and this number is in conformity with that established in CMVM recommendation II.1.2.2..
Additionally, none of the non-executive directors fall within any of the situations envisaged in article 414-A(1) of the Companies' Code, except those of sub-paragraphs (b) and (h), wherein they are directors of CIMPOR and members of the management or supervisory bodies of five companies (see Annex I hereunder).
The fact that the referred to recommendations on the qualitative composition of the Board of Directors are expressly provided for in article 7 of that body's regulations, well illustrates the importance CIMPOR places on adopting modern international guidelines on corporate governance and the Company's concern with the adjustment thereto.
The Board of Directors must meet at least once quarterly, without prejudice to other interim meetings which may be deemed necessary. No resolutions can be taken unless a majority of its members is present or represented, and each director may only represent one other member of the board of directors. The Board met 9 times during 2008 and the minutes of the meetings were drawn up.
The Board of Directors approved its operating regulations on 26 March 2008, which can be viewed on CIMPOR's website (at www.cimpor.pt). These regulations establish, inter alia, rules on the duties of directors, situations of conflicts of interest and relations with shareholders and the market.
The powers of the Board of Directors are those conferred by the Companies Code, plus the following powers, pursuant to Articles 4 and 5 of the articles of association: (i) increase the share capital with the entry of cash up to the limit of one billion euros; (ii) issue autonomous warrants on its own securities (which may grant the right to subscribe or acquire shares in the Company, up to the aforementioned limit of one billion euros); (iii) issue bonds or other debt securities of any kind or form permitted by law.
As mentioned above, following in the path of CMVM recommendation II.2.1, the Board of Directors has delegated all its powers for the day-to-day running of the Company to an Executive Committee composed of five of its members, which cannot decide on matters established by law as non-delegable. These are, pursuant to Article 407(4) of the Companies' Code:
Moreover, and in line with recommendation II.2.2., the following are also impeded from being delegated to the Executive Committee, pursuant to article 16(3) of the Board of Directors Regulations:
The Executive Committee shall also, according to article 17(7) of those Regulations, submit matters to the Board of Directors for decision when such subjects concern any business, commitments, contracts, agreements and conventions to be concluded with shareholders possessing 2% or more of the share capital of CIMPOR, whenever the nature or monetary value of such matters means that they may not be considered day-to-day business.
The non-executive directors of the Company, in compliance with the duties attributed them by law and the regulations, have developed their role of supervising, monitoring and assessing the activity of the executive members in an effective manner and without having encountered constraints of any nature (see CMVM recommendation II.2.4.).
Pursuant to the provision of article 407(8) of the Companies' Code and article 16(4) of the Board of Directors Regulation, the non-executive directors of CIMPOR have performed the activities required to comply with their general duty to monitor the activities of the Executive Committee.
Accordingly, the delegation of the day-to-day management under such rules does not prevent the Board from taking resolutions on such matters, since the non-executive directors are responsible by law for the general monitoring of the performance of empowered director(s) or the executive committee, as well as being liable for any acts or omissions of such when, notified of such acts or omissions or the intention to practise such, they do not call on the Board to intervene and take suitable measures.
The performance of the role of non-executive director is further facilitated by the fact that the Chairman of the Board of Directors does not have an executive role and is an independent member, which drives the coordination of the work of the non-executive members (thus, the Company does not apply CMVM recommendation II.2.3.).
The activity of the non-executive directors in 2008 primarily focused on the following two areas:
The following procedures have been created to ensure that all members of the Board of Directors are aware of the decisions taken by the Executive Committee and, in particular, so that the non-executive directors take their decisions in an independent and informed manner (as envisaged in article 18 of the Board of Directors Regulations):
• The members of the Board of Directors can also request that the Executive Committee provide documents or information outside the Board's meetings.
Following the amendments made to the Portuguese Companies' Code by Decree Law no. 76/2006 of 29 March, the Annual General Meeting of 11 May 2007 decided to adopt the onetier system provided for in article 278(1)a) of the Companies' Code.
Accordingly, the management of the Company is performed by the Board of Directors, and the Audit Committee and Statutory Auditor perform the supervision.
Close on two years after this decision, the Board of Directors considers the model adopted to adequately meet the specific features of the Company, and it has ensured that CIMPOR's governing bodies perform correctly, not only by fully complying with applicable legislation but also according to the best national and international practices on corporate governance, transparency and the accountability of management to the shareholders, the market and all other stakeholders in the Company. This has, as it happens, been a concern of the Board of Directors in its relations with the shareholders and the market, as has been established in article 25 of the Board of Directors Regulations.
Consequently, and in accordance with the assessment performed by the Board of Directors for the purpose of complying with CMVM recommendation II.1.1.1., it is this body's opinion that the implementation of the corporate governance model adopted at the General Meeting of 11 May 2007 has been able to prevent the occurrence of any constraints to its operation, therefore the proposal of any measures by the Board of Directors to alter the modus operandi of the model is not justified.
At its meeting on 27 April 2005, the Board of Directors decided, as provided for in Article 13(1) of the articles of association, to set up an Executive Committee composed of five of its members. The powers of the Company's day-to-day management were delegated to this Committee, with the exception of those powers that cannot legally be delegated.
The Executive Committee has the same membership as in the previous term of office, as described in II.1.2 above.
The decisions of the Executive Committee, which is chaired by Pedro Teixeira Duarte who, when necessary, is replaced by Jorge Salavessa Moura, are taken by a majority of those present or represented. Decisions cannot be taken without a majority of members being present or represented. The Executive Committee met 45 times during 2008 and the minutes of the meetings were drawn up (see CMVM recommendation II.5.3).
Notwithstanding the collective exercise of duties delegated in the Executive Committee, each of its members has been specifically entrusted with the responsibility of supervising certain Functional Areas (see section II.2.1. below).
The following distribution for liaison with external entities was established:
The financial area has been attributed to Manuel de Faria Blanc, who has been performing this duty for two terms of office, thus complying with CMVM recommendation II.2.5..
The practice of the Executive Committee, according to recommendations II.3.1. and II.3.2., is to comply with the procedures necessary for guaranteeing the full transparency of its relations with the other governing bodies. In this context:
II.1.4.2. Internal Consultative Committee on Corporate Governance and Social Responsibility
In response to international corporate governance best practices, an Internal Consultative Committee was formed by the Board of Directors at the start of 2002.
The Board of Directors decided in 2005 to extend the scope of those matters to include issues concerning the social responsibility of the Group, and the committee's name was changed to the "Board of Directors' Internal Consultative Committee on Corporate Governance and Social Responsibility".
This Committee is currently responsible, as envisaged in article 20 of the Board of Directors Regulations, for studying, preparing and advising the Board on in-house standards and procedures to be adopted concerning the development and improvement of principles and practices of corporate conduct and governance, sustainable development and social responsibility, including aspects related to the internal functioning and relations of the Board itself, the prevention of conflicts of interest and information discipline. This special committee is thus equipped with all the powers necessary for performing the duties established in the second part of CMVM recommendation II.5.1.
The Committee is composed of at least three directors (the majority non-executive and independent) and its current members are:
The first two are independent non-executive directors.
The Committee meets whenever necessary and, in principle, at least once every half-year. It can call on external consultants in different areas of expertise, at the Company's expense, whenever it deems necessary. The Board met 4 times during 2008 and the minutes of the meetings were drawn up (see recommendation II.5.3)..
The CIMPOR Group is organized into business areas which correspond to the countries where the Group operates. These business areas are in turn grouped in major regions, viz.: (i) the Iberian Peninsula; (ii) the Mediterranean Basin; (iii) Latin America; (iv) Southern Africa; and (v) Asia. The various activities in each Business Area are grouped by product, and the core business is the production and sale of cement.
As the holding company for the Group, CIMPOR - Cimentos de Portugal, SGPS, S.A. is responsible for its strategic development – as regards the whole internationalization process – and for overall management of the different business areas, ensuring coordination of the financial, technical, human and other resources in harmony with the criteria and guidelines that, according to the Group's main goals, are set forth in the strategic plan, which is revised and approved annually by the Board of Directors.
More thorough monitoring of the management of the different business areas is ensured by CIMPOR Portugal, SGPS, S.A., for activities in Portugal, and by CIMPOR Inversiones, S.A., a sub-holding based in Spain, for all the others. This company was set up in 2002 to be the Group's launch-pad for expansion abroad.
Each of the abovementioned regions has a "zone manager", except for the Iberian Peninsula where, because of the size and diversity of its operations, such a role does not exist. This manager sits on the Board of Directors of the companies in the respective business areas and reports directly to the Board of Directors of CIMPOR Inversiones, S.A..
The Board of Directors of CIMPOR Inversiones, S.A is made up of three of the five members of the Executive Committee of the Board of Directors of the holding company - Jorge Manuel Tavares Salavessa Moura, Luís Filipe Sequeira Martins and Manuel Luís Barata de Faria Blanc - who are also on the management boards of the sub-holdings responsible for coordinating the Group's activities in Portugal and Spain - CIMPOR Portugal, SGPS, S.A., and Corporación Noroeste, S.A., respectively.
These three members of the board also have special responsibilities, without prejudice to the collective performance of the tasks delegated to said Executive Committee, concerning the monitoring of the Group's different Functional Areas:
• Corporate Centre, Accounting, Consolidation and Tax, and Planning, Control and Information Systems - Manuel de Faria Blanc, replaced when necessary by Jorge Salavessa Moura.
The corporate organisation model for each business area is that considered to be best suited for each context, given the business' characteristics and conditions and the country's legal system. The aim is to take advantage of possible synergies and benefit from more favourable financial and tax frameworks.
Each business area is autonomously managed, particularly in day-to-day and operational management matters, according to a planning and control system steered by the holding company. This system's strategic guidelines, business and investment plans and targets and annual budgets are defined through participation and interaction, subject to periodic review and control. The policy concerning the management composition for each business area is that both local nationals and other Group personnel are appointed, so as to provide multicultural management.
In companies that are directly or indirectly dependent on CIMPOR - Cimentos de Portugal, SGPS, S.A., the most important decisions - e.g. those that exceed specific values or that have greater impact on profits or on the Group's strategic development - must be approved or ratified by the board of the holding company. This also applies to decisions or actions that, when dealt with at Group level, enable significant synergies to be generated.
In order to perform its role properly, CIMPOR has functional structures supporting the Group's management and the management of each business area, as shown in the following diagram.
The main functions of the Corporate Centre are: (i) to contribute to the achievement of the Group's international development strategy, guaranteeing the procedures leading to the acquisition of companies in the different markets to which the group intends to expand its operations; (ii) to ensure, through the Investor Relations Office, regular communication with players in the capital market, namely shareholders, regulators and other public authorities, financial analysts and fund managers and other collective investment bodies; and (iii) in the Financial Operations area, to ensure access under the best conditions to the financial resources necessary for the Group's expansion and its day-to-day operation.
The External Relations and Communication Department ensures implementation of the Group's communication and image policies.
The Internal Audit Department is responsible for conducting and coordinating financial, asset and operational audits throughout the Group by examining and assessing the adequacy and effectiveness of the internal control systems and the quality of their performance.
Set up following the inclusion of occupational health and safety among the CIMPOR Group's critical business values and as one of the priority targets of its operational strategy, the mission of the Health and Safety Advisory Office embraces: (i) proposing guidelines that the policy adopted should follow, the goals to be achieved and the management system to be used; (ii) galvanizing its implementation; (iii) coordinating the activities in question in functional terms, on a Group-wide basis; and (iv) supervising its implementation and assessing the results.
The harmonization and standardization of processes and practices which enable Group culture to be enhanced and the quality, flow and reliability of decision-making information to be improved have long been an important pillar in the CIMPOR Group's global policy.
At the start of 2004, after the "Shared Services" company - "CIMPOR - Serviços de Apoio à Gestão de Empresas, S.A. (CIMPOR Serviços) - was founded, a series of non-core business processes/functions that had been scattered throughout the Group holding company, the CIMPOR Portugal sub-holding and the operating companies themselves were transferred to CIMPOR Serviços.
CIMPOR Serviços provides management, consultancy and advisory services to all Group companies, particularly those with head offices in Portugal. Its current organizational structure is shown in the diagram below.
The Planning, Control and Information Systems Department coordinates and executes the entire process of preparing and controlling the plans and budgets of the different business areas and companies with head offices in Portugal, as well as the management and development of the Group's information systems and technology.
The Accounting, Consolidation and Tax Department is responsible for: (i) promoting and carrying out the entire financial consolidation process; (ii) defining the Group's accounting principles and policies, and coordinating and supporting their implementation; (iii) preparing and undertaking the accounting functions of the companies with head offices in Portugal; and (iv) carrying out the Group's tax planning and ensuring that these companies fully comply with their tax obligations.
The Personnel Department, besides providing human resource policy implementation support to the Group's different business areas, implements the human resources policy in Portugal, striving to ensure the best use for the available skills and development of these resources to a degree that maximizes employee performance and contributes to employees' personal and professional accomplishment. This department is also responsible for managing personnel matters in Group companies with head offices in Portugal, on the basis of service provision contracts entered into with such companies.
Group companies can also enter into such contracts with the Financial Department to provide services regarding their receivables, payables and treasury processes and the monitoring and control of their financial management.
The Logistics Department manages the physical spaces of companies belonging to the Group with head offices in Lisbon (Rua Alexandre Herculano and Prior Velho), and also provides them with administrative support services in the purchasing and stationery, travel and accommodation, communications and filing fields. It also offers advisory services on organizational development and administrative support to vehicle management and in contracting industrial accident insurance to the set of companies included in the Portugal business area. It further manages and controls the Group's asset risks, guaranteeing that such risks are duly covered by insurance contracts that are appropriate to the underlying risks of the Group's business.
The mission of the Customer Support Department is to ensure liaison between the various elements of the Shared Services Centre and the companies served - fostering continued improvement in the quality of the services rendered and raised company-customer satisfaction levels. It is also responsible for providing any support required by the respective governing bodies, particularly in legal matters.
The need to strengthen the Group's technical and technological culture led to the Board of Directors deciding, at the end of 2004, to transfer the Technical and Industrial Development Centre of the holding company and the Central Laboratory of CIMPOR - Indústria de Cimentos, S.A., to a new company then founded: CIMPOR TEC – Engenharia e Serviços Técnicos de Apoio ao Grupo, S.A. The business started-up on 1 January 2005, with the following main mission:
The Company's organization is broken down into three major segments of activity, as shown in the diagram below:
At holding company level, in addition to the Corporate Centre – with responsibilities that include financial risk management – the Group also possesses an Internal Audit Department which supervises the adequacy and effectiveness of the internal control systems in all the Group's areas, and ensures the good performance of those systems.
The functions of this Department are:
verifying the custody, physical existence and valuation criteria of assets;
To carry out operational audit tasks (particularly in the areas of marketing, production, investment, conservation and personnel),
Risk management in the CIMPOR Group begins with the main operating companies, which identify, measure and analyse the different risks to which they are exposed. Particular emphasis is given to operating and market risk (business-volume risk), with estimates being made of the probability of occurrence of the various factors underlying the risks and their potential impact on the Company's business or the activity in question.
The operating managers are responsible for designing and implementing the most suitable risk control mechanisms. The efficiency of such mechanisms is periodically evaluated by the holding company, through the Internal Audit Office under an annual plan for auditing financial areas and information systems, and verifying processes and conformity with approved procedures.
The main goal of the holding company is to obtain an overall picture of the risks faced by the Group in each of its different activities and business areas and to ensure that the resulting risk profile is consistent with the Group's global strategy, particularly in relation to the level of risk deemed acceptable, given the Group's capital structure. In other words, in harmony with the policy defined by the Board of Directors: to combine the constant search for business opportunities that can make a positive contribution to the value creation process with a level of risk that, in terms of CIMPOR's long-term rating, does not jeopardize its current investment grade.
The Directors' Report includes a chapter describing the policies for financial and asset risk management, guaranteed for the holding by the Corporate Centre and for CIMPOR Serviços by the Logistics Department. The Group's policy in regard to financial risks of a more general nature and not subject to specific coverage is steered towards the geographical diversification of its expansion-generating investments, so as to balance CIMPOR's presence in mature and emerging markets and foster business operations at different levels of development. In this sense, potential acquisition targets are not only defined taking into account the need to maintain a balanced and geographically diverse business portfolio, but also the assets to be acquired are assessed on a case-by-case basis, incorporating risk premiums that are appropriate to the specific situation of each deal and each country.
CIMPOR deems its internal control system to be effective in detecting risks associated to its business activity, in safeguarding its assets and benefiting the transparency of its corporate governance, fully complying with CMVM recommendation II.1.1.2.
The General Meeting held on 27 April 2005 unanimously appointed a Remuneration Committee for the four-year term from 2005 to 2008, pursuant to Article 16 of the articles of association, composed of the following members:
Only the first above-identified member is deemed to not be independent, in the light of the criteria established by section II.19. of the Annex to CMVM Regulation no. 1/2007, given that said member is a relation in the first degree to the director Pedro Maria Calaínho Teixeira Duarte. Notwithstanding, given that such non-independent member is in a minority on the Committee, any possible conflicts of interest are deemed to be sufficiently safeguarded.
This Committee met 3 times during 2008 and the minutes of the meetings were drawn up (see CMVM recommendation II.5.3).
The remuneration of the members of the Company's board of directors, and its form and mode of payment as well as its respective supplementary retirement or disability pension scheme, are determined by the Remuneration Committee, which consists of shareholders elected by the General Meeting. Such remuneration may include a variable component based on the year's profit, but this may not in total exceed 5% of the profit, pursuant to Article 16(6) of the articles of association.
The fixed annual remuneration of the members of the Board of Directors is established by the Committee on the basis of the following principles:
In addition, all the directors benefit, by decision of the Remuneration Committee, from the "Employee Stock Purchase Plan", as described in section III.5.1 below, and pursuant to the terms established therein.
The variable remuneration (including the granting of share options) is limited to members of the Executive Committee, and is determined annually on an individual basis by the Remuneration Committee according to the Group's profit (complying with the statutory limits mentioned above), the extent to which the defined strategic goals were met and the appraisal of each director's performance in their specific area of operation.
Said Committee awarded the members of the Executive Committee in 2008, based on those criteria, a total of EUR 2,035,000 in bonuses, equivalent to around 0.67% of the Group's net income (after minority interests) and to 0.81% of the Company's net profit, on an individual basis.
Share options are granted in accordance with the rules of the overall programme, as set forth in paragraph III.5.2 below. The fact of spreading the possibility of exercising the options over a time period (four years), not only defers a large part of the corresponding benefit but also make such options depend on the Group's medium to long term performance and the continuation of the respective profits.
Accordingly, the remuneration of the members of CIMPOR's management body is structured so as to permit the alignment of their interests with the Company's interests, pursuant to CMVM recommendation II.1.5.1.
In relation to the executive directors, the number of options granted, exercised and extinguished in 2008 was:
| Series | |||||
|---|---|---|---|---|---|
| 2005 | 2006 | 2007 | 2008 | Total | |
| Exercise Price (euros) | 3.,30 | 4.05 | 4.90 | 4.25 | - |
| Options Granted | |||||
| Initial Options | - | - | - | 137,500 | 137,500 |
| Derived Options | - | - | - | 412,500 | 412,500 |
| Exercisable Options | 146,000 | 125,000 | 135,000 | 137,500 | 543,500 |
| Exercised Options | 146,000 | 125,000 | 135,000 | 137,500 | 543,500 |
| Extinguished Options * | - | - | - | - | - |
* In addition to this options extinguished as a result of termination of the respective financial year
| Series | Options Exercisable in: | Total | |||
|---|---|---|---|---|---|
| 2009 2010 |
2011 | ||||
| 2006 | 125,000 | --- | --- | 125,000 | |
| 2007 | 135,000 | 135,000 | --- | 270,000 | |
| 2008 | 137,500 | 137,500 | 137,500 | 412,500 | |
| Total | 397,500 | 272,500 | 137,500 | 807,500 |
A total of 807,500 options were still to be exercised at the year's end, broken down as follows:
In accordance with Article 16(3) of the articles of association a lifetime pension may also be granted to retiring directors, provided the following prerequisites are met:
The amount of the pension is determined on the basis of the time and the relevance of the services rendered and the beneficiary's circumstances and may be reviewed annually. This amount, set in accordance with these criteria, may never exceed the highest value of the remuneration set at any time for the directors in office, is established by and may be subject to additional terms and conditions determined by the general meeting or the Remuneration Committee, if there is one, and may take the form of a contract.
The referred to provision of the articles of association has not yet been applied. Furthermore, no compensation was paid nor is any such payment envisaged, irrespective of its nature, in the event of removal from office of any director or the early termination of office.
As at 31 December 2008 the total value of remunerations, contributions to the supplementary retirement or disability pensions scheme and other incentives earned by members of the Company's board of directors (including the difference between the purchase price of the shares acquired under the "Stock Purchase Plan" and the "Stock Option Plan" and their price on the date of purchase) was as follows:
| (Amounts in euros) | Fixed remuneration |
Variable remuneration |
Total remuneration |
|---|---|---|---|
| Executive Directors | 1,291,615.57 | 2,696,675.00 | 3,988,290.57 |
| Non-Executive Directors | 536,841.80 | - | 536,841.80 |
| Total | 1,828,457.37 | 2,696,675.00 | 4,525,132.37 |
The members of the Board of Directors did not earn any other remuneration whatsoever from other companies in a group or control relationship with CIMPOR – Cimentos de Portugal, SGPS, S.A., nor any significant non-monetary benefits that may be considered remuneration.
The same stands true for the members of the Audit Committee. The remuneration of this Committee is also determined by the Remuneration Committee. The remuneration of the Audit Committee, which solely has a fixed component, amounted to EUR 98,805.00 in 2008.
In 2006 the board of directors approved and published a set of in-house rules and procedures on how communications of alleged irregularities occurring within CIMPOR Group companies are to be received, recorded and dealt with. These rules and procedures respect the legal and regulatory provisions, the recommendations that apply at any given time (namely CMVM recommendation II.1.4.1) and the principles and rules in the Code of Ethics adopted by the Group.
The new Regulations have established a system for such reporting which is designed to be effective, quick and capable of detecting, investigating and resolving situations, while respecting the highest ethical principles – in particular the principles of integrity and responsibility – as well as the rules of confidentiality and non-retaliation, thereby safeguarding relations with the persons involved.
It is important to clarify, for the purposes of CMVM recommendation II.1.4.2 that, pursuant to and for the purposes of these Regulations, in accordance with Article 2(2) therein, "irregularity" is taken to be "any fraudulent or negligent act or omission, contrary to legal or regulatory provisions, the Articles of Association or the rules or ethical principles of the Group", which can be imputed to any member of the governing body or any other employee of the CIMPOR Group.
The means by which reports are made, the persons to whom they should be addressed and way in which they are handled are duly set forth in the Regulations, and the Internal Audit Department of the holding company shall, without prejudice to the powers of the Board of Directors' Internal Consultative Committee on Corporate Governance and Social Responsibility, oversee and monitor the entire system, with special reference to levels of adequacy and effectiveness.
Attention is drawn to the explicit guarantee in the Regulations that each and every communication made by an employee under the terms and conditions set forth therein shall be treated in confidence and anonymously, in particular in relation to the identity of the person reporting the irregularity (unless the latter expressly and unequivocally requests otherwise). Provided that he/she is acting in good faith, this person is also assured that he/she will not be subject to any kind of prejudicial treatment, retaliation, discrimination, threat or sanction by CIMPOR. But if the conduct of the person reporting fails to respect these principles, he/she may be held to have committed an offence which may be subject to disciplinary action appropriate and proportional to the offence, without prejudice to any civil and/or criminal liability which may arise from his/her conduct.
In addition to the legal provisions applicable to companies, to corporations open to investment by the public and to the stock markets, the Company's culture and practice stresses the rules of good conduct in the event of a conflict of interest arising between members of the governing bodies and the Company, and the principal obligations resulting from the duties of diligence, loyalty and confidentiality of the members of the governing body, with special reference to the improper use of Company property and business opportunities.
This culture is ingrained in article 4 of the Board of Directors Regulation (available on CIMPOR's website, www.cimpor.pt, according to CMVM recommendation II.1.1.3), according to which the maximisation of the value of the Company and the CIMPOR Group is a criteria that is horizontal to the action of the Board's members, adopting the basic concept of sustainable development and the best-known economic, social and environmental practices, ensuring strict compliance with law, the principles of good faith and raised ethical standards of integrity, loyalty, honesty and responsibility.
These Regulations particularly enshrine the following fundamental duties of the members of the Board of Directors:
The Regulations of the Company's Audit Committee (available on CIMPOR's website www.cimpor.pt, according to CMVM recommendation II.1.1.3) also enshrine a set of duties in terms of conduct to be complied with by this body in the performance of its supervisory duties.
Even though the Board of Directors has always taken care to apply these principles in all of the Group's companies, it was deemed useful to codify a set of rules on these and other matters that are especially relevant to the Group's business. A Code of Ethics was therefore approved and published internally (available from the website www.cimpor.pt) so as to specifically regulate these matters and formalize the observance by all the Group's employees of high standards of conduct in their respective functions.
The Company's Code of Ethics fully complies with the Portuguese standard (NP 4460- 1/2007) on ethics in organisations.
The share capital of CIMPOR currently stands at 672 million euros, and it is fully paid up. (Registered and ordinary) shares number 672 million, (each with a par value of one euro), and are traded on Lisbon Euronext.
| Characteristics of CIMPOR Securities |
|---|
| Title: CIMPOR – Cimentos de Portugal, SGPS, S.A. |
| Share Trading: Euronext Lisbon |
| Futures trading: Euronext Lisbon |
| Codes: |
| LISBON TRADING: CPR |
| REUTERS: CMPR.IN |
| BLOOMBERG: CIMP PL |
| Number of shares (with a par value of 1 euro): Total – 672,000,000 Listed for trading – 672,000,000 |
According to the Information on Qualifying Holdings received by the Company by 31 December 2008, and in compliance with the rules of imputing voting rights established in the Securities' Code, the holders of shareholdings were, on that date, the following:
| Number | % of | |
|---|---|---|
| Shareholder | of | Share |
| Shares | Capital | |
| Teixeira Duarte, SGPS, S.A. | 153,884,443 | 22.90% |
| Manuel Fino, SGPS, S.A. | 136,141,960 | 20.26% |
| Grupo Lafarge | 116,089,705 | 17.28% |
| Banco Comercial Português, S.A. (1) | 67,474,186 | 10.04% |
| Bipadosa, S.A. | 44,912,524 | 6.68% |
| Ten. Coronel Luís Augusto da Silva | 14,049,090 | 2.09% |
(1) Including Pensions Fund
No shareholder of CIMPOR holds any special rights and all the shares representing the Company's share capital can be freely traded on a regulated market. No shareholder agreements are known of and no system of employee participation in the share capital is envisaged.
As at 31 December 2007, CIMPOR held 4,002,209 own shares in portfolio. During the first six months of 2008 it disposed of 1,168,620 shares to its employees at an average price of
| Date | No Shares | Price (EUR) | Note |
|---|---|---|---|
| 17 March | 276,700 | 3.300 | (1) |
| 17 March | 240,440 | 4.050 | (1) |
| 17 March | 229,360 | 4.900 | (1) |
| 28 March | 250 | 4.900 | (1) |
| 13 May | 157,380 | 4.565 | (2) |
| 27 May | 264,490 | 4.250 | (3) |
around 4.154 euros, under the stock purchase and stock option plans referred to in section III.5. below.
(1) Options Award Plans (2005, 2006 and 2007)
(2) Share Acquisition Plan (2008)
(3) Options Award Plan (2008)
A total of 5,643,243 shares were acquired during 2008 at an average unit price of 4.503 euros, with the intention of securing the ongoing nature of the Group's incentive policy and to meet commitments under the referred to stock purchase and option plans (see Annex II).
As a result, the number of own shares held in portfolio at the end of 2008 was 8,476,832, which is equivalent to 1.26% of the Company's share capital.
The articles of association can be amended pursuant to the provisions established in law and according to the rules defined in the articles of association proper (Article 8).
Share markets throughout the world underwent one of their largest ever declines in 2008, as a result of the crash of the high-risk US sub-prime credit market and its devastating impact on the banking sector and on the real economy, particularly from the third quarter on.
The Lisbon Stock Exchange did not escape this decline and its main index (PSI20) fell 51.3%, recording a turnover of only EUR 52 billion (45% down on the 2007 figure) and a level of volatility recording a maximum of 32.6%.
CIMPOR's shares followed this trend. Around 283 million CIMPOR shares were traded (a year-on-year fall of 34%) for a total value close on 1.4 billion euros (half the amount traded in 2007).
The maximum price of the year (6.16 euros) was attained on 15 May, and the minimum price was recorded on 10 October - 3.20 euros. The share price then benefited from a slight recovery in the market, closing the year at 3.48 euros, 42% below the closing price at the end of 2007 (this being, even so, a fall that was not as steep as that recorded by the PSI20 index and the Euronext 100 index).
The dividends for 2007 were paid on 6 June. The gross dividend amounted to 0.23 euros/share (0.184 euros in net terms) representing an increase of 7% on the dividend paid in the previous year, with gross earnings per share of around 4.3% on the dividend payment date.
| 2008 | 2007 | |
|---|---|---|
| Share Capital (103 euros) |
672,000 | 672,000 |
| Number of shares (1) | ||
| Total | 672,000,000 | 672,000,000 |
| Treasury Shares | 8,476,832 | 4,002,209 |
| Share price (euros) | ||
| Maximum | 6.16 | 7.72 |
| Minimum | 3.20 | 5.58 |
| Year end | 3.48 | 6.00 |
| Market capitalization (103 euros) (1) |
2,338,560 | 4,032,000 |
| Gross dividend / share (euros) (2) | 0.185 | 0.230 |
| Dividend yield (2) (3) | 5.32% | 3.83% |
| Net income after M.I. (103 euros) |
219,441 | 304,073 |
| Payout ratio (2) | 56.7% | 50.8% |
| Transactions | ||
| By volume (1,000 shares) | 283,461 | 429,264 |
| By value (106 euros) |
1.404 | 2.802 |
| Market share | 2.7% | 2.8% |
| Annual Evolution | ||
| Euronext 100 | - 45.2% | + 3.4% |
| PSI 20 | - 51.3% | + 16.3% |
| CIMPOR share | - 42.7% | - 4.6% |
(1) At 31 December
(2) In 2008: according to the proposal to be submitted to the General Meeting
(3) Relative to share price at year end.
The Board of Directors of CIMPOR intends to maintain a divided distribution policy that takes into account:
The proposed allocation of the profits declared in the management report and relating to the individual activity of CIMPOR follows the policy guidelines set forth above, and the proposed dividend of 0.185 euros amounts to around 56.7% of the Group's net profit.
The Annual General meeting of CIMPOR held on 9 May 2008 decided, in the ambit of the Group's employee remuneration and incentive policy, and with a view to better alignment of employees' interests with the underlying goal of creating shareholder value, as in previous years and as proposed by the Board of Directors, to give employees the opportunity to invest in the company under advantageous terms. Such investment is likely to assist employees to better integrate the long-term goals of the Company and its shareholders.
Therefore, the sale of own shares to employees and board members of the Company and subsidiaries was approved, under a new Employee Stock Purchase Plan and under the "2008 Series" of the Stock Option Plan for the Group's directors and personnel, the regulations for which were established in 2002 (with minor changes introduced in March 2004) by the Remuneration Committee.
As in previous years, and in accordance with CMVM recommendation II.1.5.4, this approval by the General Meeting made explicit reference to the grounds for adopting the plans, contained a summary of the essential characteristics of the approved plans, including the prerequisites for attributing the options, the criteria for setting the price of the shares or for exercising the options (determined in relation to the listed share price at specific times) the periods in which the options may be exercised, and the granting of powers to the Board to execute or modify the plans. The proposals of the Board of Directors thus include all the elements needed for the correct evaluation of the plans, in line with the respective regulations.
This Plan is aimed at the directors and personnel with a stable labour relationship with CIMPOR or with companies with head offices in the Iberian Peninsula directly or indirectly controlled by CIMPOR - Cimentos de Portugal, SGPS, S.A., the directors and managers of the other Group companies (proposed by managers of the respective areas for that purpose) and other personnel (indicated for that purpose by the Executive Committee), contracted by companies in which the holding company or any company controlled by it has a shareholding. The Employee Stock Purchase Plan (for 2008) consisted of awarding each beneficiary - as decided by the Remuneration Committee with regard to the Directors of the holding company, and as decided by the Executive Committee in all other cases - the right to acquire a specific number of CIMPOR shares at 75% of the closing stock market price (rounded up) on the transaction date, and defined as follows:
Maximum number of shares to purchase = Gross base monthly salary / 2 75% of closing market share price on transaction date
rounded down to the nearest multiple of five or ten shares, depending on whether the above formula results in fewer or more than 100 shares, respectively.
Of the 2,408 employees eligible to purchase CIMPOR shares according to this rule, 491 employees responded affirmatively (432 in Portugal and 59 in Spain) within the given timeframe (17 to 24 April). A total of 157,380 shares at a price of 4.565 euros per share were acquired.
The Stock Option Plan - 2008 Series applied to the Directors of the holding company who the Remuneration Committee decided to name as beneficiaries and the members of the Boards of Directors of subsidiaries and other Group personnel designated to that end by the Executive Committee.
As mentioned in the decision of the Annual General Meeting of 9 May 2008, the essential features of this plan (with the amendments made by the Remuneration Committee in March 2004) are as follows:
in each of the subsequent three years. The shares acquired by exercising the initial options and the corresponding derivative options comprise a "series";
278,100 initial options were granted to 206 Group Directors and managers in 2008 under this plan, during an exercise period running from 15 to 20 May. 185 of these exercised part or all of their options, at the price of 4.25 euros per share, acquiring a total of 264,490 shares.
Thus, in 209 to 2011 inclusive, a maximum of 792,270 derivative options of this series may be exercised at the same price per share (following the deduction of 1,200 options held by an employee who has voluntarily terminated employment with the Group in the meantime).
Under the 2005, 2006 and 2007 Series, of the 767,100 derivative options that could be exercised in 2008, a total of 746,750 options were exercised, and the remaining 20,350 were extinguished. Furthermore, 1,000 derivative options of the above-stated employee of the 2006 and 2007 series (falling due in 2009 and 2010) were also extinguished.
To summarize the situation for 2008:
| Series | |||||
|---|---|---|---|---|---|
| 2005 | 2006 | 2007 | 2008 | Total | |
| Exercise price (euros) | 3.30 | 4.05 | 4.90 | 4.25 | - |
| Options Granted | |||||
| Initial Options | 278,100 | 278,100 | |||
| Derived Options | 834,300 | 834,300 | |||
| Total | 1,112,400 | 1,112,400 | |||
| Exercisable Options | 281,700 | 246,650 | 238,750 | 278,100 | 1,045,200 |
| Exercised Options | 276,700 | 240,440 | 229,610 | 264,490 | 1,011,240 |
| Extinguished Options | |||||
| Exercisable in 2008 | |||||
| For non-exercise of Init. Op. | 13,610 | 13,610 | |||
| For non-exercise of Deriv. Op. | 5,000 | 6,210 | 9,140 | 20,350 | |
| Exercisable from 2009 to 2011 | |||||
| For non-exercise of Init. Op. | 40,830 | 40,830 | |||
| For other reasons | --- | 400 | 600 | 1,200 | 2,200 |
| Total | 5,000 | 6,610 | 9,740 | 55,640 | 76,990 |
Therefore, while the number of shares needed at the beginning of the year to meet the exercise of options granted up to 2007, inclusive, rose to 1,491,250, the number of shares needed at the end of the year to meet the exercise of all the options granted in the meantime was 1,515,420, broken down as follows:
| Options Exercisable in: | |||||
|---|---|---|---|---|---|
| Series | 2009 | 2010 | Total | ||
| 2006 | 246,250 | --- | --- | 246,250 | |
| 2007 | 238,450 | 238,450 | --- | 476,900 | |
| 2008 | 264,090 | 264,090 | 264,090 | 792,270 | |
| Total | 748,790 | 502,540 | 264,090 | 1,515,420 |
Apart from the sale of own shares under the stock purchase and stock option plans referred to in sections II.4.3 and III.5 above, neither the Company nor any of the companies it controls has undertaken any business or operation with any members of its management and auditing bodies, holders of qualified shareholdings or companies that are in a group or control relationship with these, with the exception of some transactions of no financial significance to any of the parties involved, and which were conducted under normal market conditions for similar operations and executed as part of the CIMPOR Group's regular activity.
In order to maintain a close relationship with the stock market, CIMPOR has had an Investor Relations Office since it was first listed in 1994. This office is responsible for informing the financial community about the evolution of the Group's business and for supporting current and potential shareholders in CIMPOR in their relations with the Company, in full compliance with the principle of equal treatment of shareholders and with CMVM recommendation III.1.2.
In addition to information which might influence the price of shares, available on the CMVM site (www.cmvm.pt), the contact this office maintains with private and institutional investors, fund managers and other collective investment bodies, analysts and other stock market operators occur through presentations, meetings and replies to requests for information by telephone, e-mail or regular post.
| Investor Relations Office contacts: | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Address: Investor Relations Office CIMPOR – Cimentos de Portugal, SGPS, S.A. Rua Alexandre Herculano, 35 1250-009 Lisboa PORTUGAL |
Personal Contacts: Filipa S. Mendes |
||||||||
| Telephones | Fax | Internet | |||||||
| 21 311 81 00 21 311 88 89 |
21 311 88 67 | [email protected] | www.cimpor.pt |
In addition, press releases with significant facts and other information of interest related to the Group's activity, notices convening General Meetings and on how to take part in them, annual reports and accounts, a brief description of the shareholder structure and the evolution of CIMPOR's share price are also posted on the www.cimpor.pt site.
In addition to the above items and compulsory information, as required under Article 4 of CMVM Regulation 1/2007, disclosed in Portuguese and English (which is also in accordance with CMVM recommendation III.1.3.) the site also includes the following:
The site also enables any interested party to immediately receive information published by CIMPOR via a mailing list created for the purpose.
Filipa Saraiva Mendes has served as the representative for relations with the stock market and the CMVM, pursuant to and for the purposes of the Securities Market Code, since 1 October 2004.
In 2008, the total cost of services rendered to the CIMPOR Group by its external auditors (Deloitte & Touche), including all the natural or legal persons belonging to its network (as set forth in European Commission Recommendation no. C (2002) 1873 of 16 May), amounted to 1,442,326 euros, broken down as follows:
| a) legal certification of accounts | 91.70 % |
|---|---|
| b) other assurance services | 2.95 % |
| c) tax consultancy services | 3.36 % |
| e) services other than legal certification of accounts | 1.99 % |
To safeguard the independence of these entities, the acquisition from them of any type of service that may jeopardize such independence is expressly forbidden, Specifically:
In addition, the acquisition of services from the external auditor or entities belonging to its network, both in Portugal and in the countries where the Group operates, is subject to a number of rules set forth by the holding company and transmitted to all the Group's companies. And so, besides prohibiting the contracting of the aforementioned services:
area (or company) requiring the service, and subsequently, depending on the amount of the proposal, by the director of the respective department or the Executive Committee responsible for deciding whether or not to award the contract.
(Term of office: 2008)
Chairman of the Board of Directors ( since August 2001)
Born in Lisbon, Portugal, on 19 November 1936. Graduated in Industrial Chemical Engineering from the Instituto Superior Técnico - IST (1959), Master of Science (1966) and Doctor of Philosophy (1968), from Birmingham University, Ph.D. in Engineering (1973) from IST and Professor (1979) at IST (retired).
Professional activities in last 5 years:
Positions in other companies, as at 31 December 2008:
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 106.550.
Born in Lisbon, Portugal, on 7 July 1933. Graduated in Finance from the Instituto Superior de Ciências Económicas e Financeiras.
Professional activities in last 5 years:
Positions in other companies, as at 31 December 2008:
President of Instituto Humanismo e Desenvolvimento
National President of the Portuguese Red Cross
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 3.820.
Member of the Board of Directors (since August 2001)
Born in Paris, France, on 15 April 1938. Diploma from Paris Institute of Political Studies (1958) and Degree in Law (1959). Higher Education Diploma in Public Law (1961). National School of Administration (1962-64).
Professional activities in last 5 years:
Positions in other companies, as at 31 December 2008:
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 3.320
Member of the Board of Directors and of the Executive Committee (since August 2001)
Born in Bayonne, France, on 13 April 1949. Graduated from the School of Civil Engineering - Mining (Nancy). INSEAD International Executive Program (Fontainebleau).
Professional activities in last 5 years:
Positions in other companies, as at 31 December 2008:
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 7.080
Member of the Board of Directors and of the Executive Committee (since August 2001)
Born in Lisbon, Portugal, on 4 December 1950. Graduated in Civil Engineering from the Instituto Superior Técnico of the Universidade Técnica de Lisboa.
Professional activities in last 5 years:
Positions in other companies of the CIMPOR Group, as at 31 December 2008:
Manager
Mecan Manufactura de Elementos de Casas de Construção Normalizada, Lda. (Portugal)
Other positions in companies outside the CIMPOR Group, as at 31 December 2008:
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 250
Member of the Board of Directors and the Executive Committee of CIMPOR – Cimentos de Portugal, SGPS, S.A. (since January 1997). Between February 1987 and January 1987 he was also director of the companies which, after a series of transformations, resulted in the present CIMPOR – Cimentos de Portugal, SGPS, S.A.
Born in Lisbon, Portugal, on 4 June 1947. Graduated in Chemical Engineering from the Instituto Superior Técnico of the Universidade Técnica de Lisboa.
Professional activities in last 5 years:
Positions in other companies of the CIMPOR Group, as at 31 December 2008:
• Nordicave Trading Industrial, Sociedade Unipessoal, Lda. (Cape Verde)
Other positions in companies outside the CIMPOR Group, as at 31 December 2008:
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 172.860
Member of the Board of Directors and of the Executive Committee (since August 2001)
Born in Lisbon, Portugal, on 24 February 1955. Graduated in Business Administration from the Universidade Católica Portuguesa (1977).
Professional activities in last 5 years:
• Executive Director of CIMPOR and member of the Board of Directors of various companies in the Group, in Portugal and abroad.
Positions in other companies of the CIMPOR Group, as at 31 December 2008:
Other positions in companies outside the CIMPOR Group, as at 31 December 2008:
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 396.860
Member of the Board of Directors and Chairman of the Executive Committee (since August 2001)
Born in Lisbon, Portugal, on 6 May 1954. Graduated in Business Administration from the Universidade Católica Portuguesa (1977).
Professional activities in last 5 years:
Positions in other companies, as at 31 December 2008:
Number of shares directly and indirectly held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008:
Member of the Board of Directors (since August 2003)
Born in Santiago de Compostela, Spain, on 11 February 1947. Graduated in Law from the University of Santiago de Compostela.
Professional activities in last 5 years:
Positions in other companies, as at 31 December 2008:
Junta Territorial del Instituto de Estudios Superiores de Empresa (IESE) en Galicia
Director of Patronato de la Fundación Unión Española de Explosivos
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 2.200.
Member of the Board of Directors (since April 2005)
Born in Portalegre, on 10 January 1954. Supplementary High School Course (1971) and attended North East London Polytechnic (Business Studies), in London (1972-1974).
Professional activities in last 5 years / Posts held in other companies as at 31 December 2008:
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 1.050.
Member of the Board of Directors (since April 2005)
Born in La Coruña, Spain, on 15 July 1948. Graduated in Economic Sciences from the Faculty of Barcelona.
Professional activities in last 5 years:
Positions in other companies, as at 31 December 2008:
Transportes Almacenes Transitários, S.A. (Spain)
Multimodal de Transportes Agrupados, S.L. (Spain)
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 1.130
Chairman of the Audit Committee (since March 1992, already holding the post of Chairman of the Supervisory Committee of CIMPOR – Cimentos de Portugal E.P., since February 1987)
Born in Lisbon, Portugal, on 19 February 1934. Graduated in Civil Engineering from Instituto Superior Técnico.
Professional activities in last 5 years:
No shares in CIMPOR – Cimentos de Portugal, SGPS, S.A. were held as at 31 December 2008
Member of Audit Committee (since May 2007)
Born in Beja, Portugal, on 4 October 1954. Graduated in Business Administration from the Faculty of Human Sciences of Universidade Católica Portuguesa (1977).
Professional activities in last 5 years:
Positions in other companies, as at 31 December 2008:
No shares in CIMPOR – Cimentos de Portugal, SGPS, S.A. were held as at 31 December 2008
Member of Audit Committee (since May 2007 as alternate member, becoming sitting member in January 2008)
Born in Lisbon, Portugal, on 26 November 1956. Graduated in Business Administration from the
Faculty of Human Sciences of Universidade Católica Portuguesa (1980) and Statutory Auditor (1987).
Professional activities in last 5 years / Posts held in other companies as at 31 December 2008:
• Statutory Auditor of various companies, representing the J. Bastos, C. Sousa Góis & Associados, SROC, Lda firm.
Number of shares held in CIMPOR – Cimentos de Portugal, SGPS, S.A., as at 31 December 2008: 26.650
| Date | Number Acções |
Price (EUR) |
Data | Number Shares |
Price (EUR) |
Date | Number Shares |
Price (EUR) |
|---|---|---|---|---|---|---|---|---|
| 16 January | 20,000 | 5.350 | 22 January | 5,000 | 5.260 | 24 January | 10,000 | 5.320 |
| 30,000 | 5.360 | 6,300 | 5.270 | 10,000 | 5.340 | |||
| 59,821 | 5.370 | 3,121 | 5.280 | 15,000 | 5.350 | |||
| 39,000 | 5.380 | 55,916 | 5.290 | 10,000 | 5.360 | |||
| 50,000 | 5.390 | 25,000 | 5.300 | 10,000 | 5.370 | |||
| 80,722 | 4.400 | 2,500 | 5.330 | 5,000 | 5.390 | |||
| 21 January | 2,000 | 5.230 | 20,000 | 5.340 | 25 January | 20,000 | 5.250 | |
| 10,000 | 5.270 | 58,000 | 5.350 | 45,000 | 5.260 | |||
| 15,000 | 5.280 | 10,000 | 5.360 | 30,000 | 5.270 | |||
| 20,000 | 5.290 | 12,000 | 5.370 | 70,000 | 5.280 | |||
| 20,000 | 5.300 | 18,735 | 5.380 | 150,000 | 5.290 | |||
| 49,868 | 5.320 | 7,656 | 5.400 | 171,000 | 5.300 | |||
| 20,000 | 5.330 | 23 January | 13,778 | 5.160 | 60,000 | 5.310 | ||
| 10,000 | 5.340 | 8,433 | 5.170 | 5,000 | 5.320 | |||
| 22 January | 1,000 | 4.800 | 28,000 | 5.180 | 10,000 | 5.350 | ||
| 5,000 | 4.810 | 10,000 | 5.190 | 28 January | 2,000 | 5.160 | ||
| 5,000 | 4.820 | 55,295 | 5.200 | 4,134 | 5.190 | |||
| 15,000 | 4.830 | 50,000 | 5.210 | 300 | 5.210 | |||
| 5,000 | 4.840 | 10,000 | 5.240 | 18,000 | 5.220 | |||
| 4,000 | 4.890 | 22,000 | 5.250 | 25,000 | 5.230 | |||
| 9,000 | 4.900 | 10,000 | 5.270 | 27,748 | 5.260 | |||
| 12,775 | 4.980 | 15,000 | 5.280 | 60,000 | 5.270 | |||
| 10,000 | 4.990 | 47,000 | 5.290 | 15,000 | 5.280 | |||
| 10,000 | 5.000 | 14,000 | 5.300 | 29 January | 9,053 | 5.280 | ||
| 20,000 | 5.010 | 20,000 | 5.310 | 70,000 | 5.290 | |||
| 5,000 | 5.030 | 5,000 | 5.320 | 20,000 | 5.300 | |||
| 10,000 | 5.040 | 10,580 | 5.330 | 8,432 | 5.300 | |||
| 18,000 | 5.050 | 30,000 | 5.340 | 35,000 | 5.310 | |||
| 5,000 | 5.140 | 40,920 | 5.350 | 25,568 | 5.320 | |||
| 15,000 | 5.150 | 24 January | 15,000 | 5.220 | 5,000 | 5.330 | ||
| 15,000 | 5.160 | 3,000 | 5.230 | 2,820 | 5.340 | |||
| 5,000 | 5.170 | 15,000 | 5.240 | 10,000 | 5.350 | |||
| 5,000 | 5.180 | 44,668 | 5.250 | 30,000 | 5.360 | |||
| 5,000 | 5.190 | 20,000 | 5.260 | 20,000 | 5.400 | |||
| 10,000 | 5.200 | 51,973 | 5.270 | 31 January | 32,000 | 5.240 | ||
| 12,230 | 5.220 | 20,000 | 5.280 | 24,895 | 5.250 | |||
| 994 | 5.230 | 25,000 | 5.290 | 7,136 | 5.260 | |||
| 10,000 | 5.240 | 71,300 | 5.300 | 53,000 | 5.280 | |||
| 38,126 | 5.250 | 15,000 | 5.310 | 50,567 | 5.290 |
| Date | Number | Price | Date | Number | Price | Date | Number | Price |
|---|---|---|---|---|---|---|---|---|
| Shares | (EUR) | Shares | (EUR) | Shares | (EUR) | |||
| 31 January | 36,000 | 5.300 | 13 October | 200 | 3.560 | 15 October | 13,132 | 4.040 |
| 15,000 | 5.310 | 20,000 | 3.580 | 19,721 | 4.050 | |||
| 9,697 | 5.320 | 70 | 3.640 | 5,778 | 4.080 | |||
| 1 February | 1,014 | 5.330 | 388 | 3.660 | 12,688 | 4.090 | ||
| 10,000 | 5.340 | 50,000 | 3.700 | 16 October | 6,911 | 3.600 | ||
| 20,000 | 5.350 | 9,206 | 3.710 | 13,089 | 3.610 | |||
| 5 February | 5,242 | 5.340 | 6,000 | 3.740 | 4,269 | 3.620 | ||
| 20,000 | 5.390 | 25,000 | 3.760 | 1,348 | 3.630 | |||
| 20,000 | 5.400 | 14 October | 9,800 | 4.000 | 3,446 | 3.640 | ||
| 6 February | 9,000 | 5.300 | 3,008 | 4.010 | 2,500 | 3.650 | ||
| 20,000 | 5.350 | 9,976 | 4.040 | 2,500 | 3.660 | |||
| 11,000 | 5.380 | 33,490 | 4.050 | 5,875 | 3.670 | |||
| 1 July | 2,600 | 3.980 | 3,375 | 4.060 | 6,200 | 3.680 | ||
| 27,369 | 3.990 | 30,000 | 4.070 | 5,000 | 3.690 | |||
| 23,428 | 3.990 | 15,587 | 4.080 | 13,832 | 3.700 | |||
| 155,454 | 4.000 | 1,529 | 4.090 | 14,834 | 3.710 | |||
| 2 July | 15,000 | 3.940 | 12,476 | 4.100 | 9,855 | 3.720 | ||
| 10,000 | 3.950 | 23,338 | 4.110 | 21,327 | 3.740 | |||
| 4,129 | 3.970 | 5,891 | 4.120 | 22,486 | 3.750 | |||
| 8,071 | 3.980 | 31,625 | 4.130 | 11,000 | 3.760 | |||
| 145 | 3.990 | 16,463 | 4.140 | 5,340 | 3.770 | |||
| 2,000 | 4.010 | 21,790 | 4.150 | 5,000 | 3.780 | |||
| 10,000 | 4.030 | 22,794 | 4.160 | 11,625 | 3.790 | |||
| 28,838 | 4.040 | 12,167 | 4.170 | 23,154 | 3.800 | |||
| 78,374 | 4.050 | 1,000 | 4.180 | 10,500 | 3.810 | |||
| 3 July | 16,000 | 4.040 | 19,318 | 4.190 | 19,608 | 3.820 | ||
| 10 October | 7,652 | 3.180 | 15 October | 1,736 | 3.820 | 1,500 | 3.830 | |
| 2,348 | 3.200 | 776 | 3.830 | 1,500 | 3.840 | |||
| 5,000 | 3.220 | 1,704 | 3.840 | 6,697 | 3.850 | |||
| 4,119 | 3.230 | 40,512 | 3.850 | 4,257 | 3.860 | |||
| 18,112 18,574 |
3.240 3.250 |
1,000 5,644 |
3.860 3.870 |
18,325 3,150 |
3.870 3.880 |
|||
| 7,369 | 3.260 | 500 | 3.880 | 4,305 | 3.890 | |||
| 81,149 | 3.270 | 2,773 | 3.890 | 22,712 | 3.900 | |||
| 2,000 | 3.290 | 8,902 | 3.900 | 15,500 | 3.920 | |||
| 4,481 | 3.310 | 10,652 | 3.910 | 1,355 | 3.930 | |||
| 9,418 | 3.320 | 500 | 3.920 | 17 October | 2,500 | 3.880 | ||
| 500 | 3.330 | 11,622 | 3.940 | 22,743 | 3.900 | |||
| 1,716 | 3.340 | 53,531 | 3.950 | 23,004 | 3.910 | |||
| 25,000 | 3.380 | 5,796 | 3.980 | 6,382 | 3.920 | |||
| 13 October | 1,605 | 3.510 | 27,995 | 3.990 | 13,356 | 3.930 | ||
| 3,029 | 3.530 | 8,516 | 4.000 | 9,187 | 3.950 | |||
| 6,708 | 3.540 | 3,565 | 4.020 | 3,249 | 3.960 | |||
| 25,000 | 3.550 | 7,492 | 4.030 | 18,381 | 3.970 |
| Number | Price | Number | Price | Number | Price | |||
|---|---|---|---|---|---|---|---|---|
| Date | Shares | (EUR) | Date | Shares | (EUR) | Date | Shares | (EUR) |
| 17 October | 498 | 3.980 | 27 October | 5,241 | 3.310 | 18 November | 1,000 | 3.480 |
| 80 | 3.990 | 20,868 | 3.320 | 19 November | 2,000 | 3.290 | ||
| 620 | 4.000 | 5,000 | 3.350 | 2,400 | 3.300 | |||
| 21 October | 18,800 | 3.960 | 9,712 | 3.410 | 500 | 3.330 | ||
| 5,189 | 3.970 | 49,383 | 3.420 | 1,935 | 3.360 | |||
| 5,511 | 3.980 | 28 October | 1,064 | 3.300 | 7,226 | 3.370 | ||
| 450 | 3.990 | 20,000 | 3.320 | 939 | 3.380 | |||
| 22 October | 449 | 3.810 | 29 October | 1,000 | 3.350 | 20 November | 101 | 3.130 |
| 500 | 3.820 | 500 | 3.360 | 8,392 | 3.140 | |||
| 17,052 | 3.830 | 3,406 | 3.370 | 10,507 | 3.150 | |||
| 15,002 | 3.840 | 8,594 | 3.380 | 2,609 | 3.160 | |||
| 3,760 | 3.850 | 3,000 | 3.410 | 5,000 | 3.170 | |||
| 500 | 3.860 | 8,000 | 3.420 | 5,700 | 3.190 | |||
| 1,705 | 3.870 | 30 October | 10,000 | 3.440 | 12,491 | 3.200 | ||
| 2,115 | 3.880 | 10,000 | 3.450 | 200 | 3.210 | |||
| 3,917 | 3.890 | 2,652 | 3.470 | 5,000 | 3.230 | |||
| 11,066 | 3.940 | 920 | 3.490 | 5,000 | 3.290 | |||
| 934 | 3.950 | 31 October | 2,059 | 3.430 | 21 November | 7,500 | 3.130 | |
| 23 October | 1,100 | 3.750 | 986 | 3.460 | 4,176 | 3.140 | ||
| 1,000 | 3.760 | 8,000 | 3.490 | 18,324 | 3.150 | |||
| 17,274 | 3.780 | 5,766 | 3.500 | 2,500 | 3.160 | |||
| 2,542 | 3.790 | 6 November | 6,594 | 3.630 | 2,500 | 3.180 | ||
| 84 | 3.800 | 7,000 | 3.640 | 5,000 | 3.190 | |||
| 5,121 | 3.810 | 1,038 | 3.650 | 2,500 | 3.200 | |||
| 1,311 | 3.820 | 36,874 | 3.660 | 2,500 | 3.220 | |||
| 2,500 | 3.840 | 99,025 | 3.670 | 5,000 | 3.250 | |||
| 3,000 | 3.850 | 28,990 | 3.680 | 25 November | 1,778 | 3.450 | ||
| 1,568 | 3.860 | 6,386 | 3.690 | 4,500 | 3.460 | |||
| 500 | 3.870 | 9,207 | 3.720 | 2,500 | 3.470 | |||
| 24 October | 2,195 | 3.550 | 700 | 3.730 | 2,500 | 3.500 | ||
| 5,000 | 3.560 | 19,186 | 3.740 | 26 November | 10,000 | 3.470 | ||
| 12,417 | 3.570 | 13 November | 2,000 | 3.460 | 1,000 | 3.480 | ||
| 90,175 | 3.580 | 1,000 | 3.480 | 2,000 | 3.485 | |||
| 8,423 | 3.590 | 2,000 | 3.500 | 28 November | 1,500 | 3.480 | ||
| 64,867 | 3.600 | 14 November | 12,000 | 3.490 | 1,000 | 3.485 | ||
| 19,102 | 3.610 | 100 | 3.500 | 4 December | 1,000 | 3.010 | ||
| 11,851 | 3.620 | 17 November | 4,504 | 3.450 | 2,000 | 3.310 | ||
| 8,050 | 3.630 | 926 | 3.460 | 2,000 | 3.316 | |||
| 19 | 3.650 | 7,074 | 3.470 | 1,500 | 3.319 | |||
| 17,901 | 3.660 | 5,597 | 3.480 | 1,500 | 3.320 | |||
| 27 October | 5,000 | 3.250 | 5,348 | 3.490 | 2,000 | 3.325 | ||
| 3,579 | 3.260 | 15,551 | 3.500 | 1,500 | 3.328 | |||
| 3,940 | 3.280 | 18 November | 3,821 | 3.450 | 2,000 | 3.331 | ||
| 10,000 | 3.290 | 8,479 | 3.460 | 1,000 | 3.332 | |||
| 20,312 | 3.300 | 2,000 | 3.470 | 237 | 3.335 |
| Date | Number Shares |
Price (EUR) |
Date | Number Shares |
Price (EUR) |
Date | Number Shares |
Price (EUR) |
|---|---|---|---|---|---|---|---|---|
| 4 December | 1,000 | 3.339 | 4 December | 751 | 3.369 | 5 December | 4,500 | 3.350 |
| 1,042 | 3.342 | 3,500 | 3.370 | 3,000 | 3.360 | |||
| 2,954 | 3.345 | 2,500 | 3.516 | 4,519 | 3.370 | |||
| 1,000 | 3.350 | 5 December | 6,670 | 3.310 | 481 | 3.371 | ||
| 3,618 | 3.354 | 1,500 | 3.340 | 1,000 | 3.375 | |||
| 1,500 | 3.355 | 60 | 3.341 | 2,000 | 3.770 | |||
| 2,000 | 3.360 | 6,270 | 3.345 | 1,000 | 3.380 | |||
| 1,000 | 3.366 | 1,000 | 3.348 | 1,000 | 3.390 |
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2008 was basically marked by the impact on the entire financial system and economic activity in general of the problems associated to the sub-prime mortgage market in the USA. The successive losses registered by the major financial institutions throughout the year, stemming from the sudden loss in value of their assets, led to a serious confidence crisis in the money and credit markets, which generated a significant impact on liquidity levels.
The growing climate of risk aversion generated, close to the end of 2008, and despite the intervention of the authorities in an attempt to foster the normal functioning of the markets, a sharp rise in credit spreads. This increase fuelled the worsening of the climate for companies of the manufacturing sector, which was already heavily affected by shrinking demand in domestic markets (given the lack of dynamism in investment and private consumption) and foreign markets (driven by the slowdown in international trade).
The extreme volatility of all markets was of particularly note in relation to commodities: the price of a barrel of oil rose to almost USD 150/barrel in the first half of 2008 – driven by the strong demand from emerging markets and a climate of increased speculation – only for it to fall to close to USD 40/barrel in the second half of the year, as fears of a global and protracted recession grew.
The progressive decline in the confidence indicators of economic agents, mirroring this climate of uncertainty, would end up fuelling the process of rapid deceleration that assailed the main developed economies, spreading that effect to the emerging markets most dependent on exporting.
In spite of the fact that the USA recorded positive growth (1.4%) in 2008, a significant contraction of economic activity in the final two quarters of the year was observed. This contraction had particular impact on the labour markets – the unemployment rate rose from 4.9% to above 7% – and housing markets (where prices fell by close to 25%).
The GDP growth rate (1.0%) in the Euro Zone was even lower due to the heavy slowdown in domestic demand, which resulted in only the first quarter of 2008 recording positive growth in economic activity. Though the inflation rate rose on average from 2.1% to 3.4%, the year-on-year change in December 2008 was only 1.6%.
Emerging or developing economies continued to record significant growth rates, despite their cooling off in the latter part of 2008. The Asian economies were of particular note in this regard, as overall GDP (excluding Japan) will have grown by close to 7%. Africa and Latin America also reported important GDP growth of 5.7% and 4.3%, respectively, less emphatic than the previous year's growth.
World cement consumption in 2008 according to the most recent estimates, which do not totally take account of the impact of the decline in economic output in the last quarter of 2008, will have been approximately 2.9 billion tons (5% up on the previous year).
The main emerging markets, in contrast to the majority of developed countries - where the cement sector was heavily affected by the impact of the international financial crisis, continued to record significant growth rates. Consumption in China and India, in particular, grew by close to 8%. This growth, though slightly slower than in previous years, strengthened their position as the world's two largest markets.
The worsening of the crisis in the real estate sector in the USA, which commenced with the problems created by the sub-prime mortgage market, led to a 12% fall in cement consumption, down to around 100 million tons (the lowest value of the last six years). The slump in the market in Western Europe, mainly affecting Spain, Ireland and the UK, will have been approximately 6%.
In Eastern Europe, Africa and Latin America, growth rates in the region of 7-8% were recorded in each one of the regions as a whole, despite some cases of significant slowdown in the closing months of 2008.
Cement prices generally indicated a trend for stabilisation, except in those countries most affected by the recession, e.g. Spain, USA and UK, where significant price decreases were recorded, primarily in the second half of 2008.
Trading activities were seriously hindered during the first few months of 2008 (due to the rise in oil prices, and the consequent price rise in maritime freighting), and also at the close of the year (as a result of the fall in demand from the main import markets).
The mergers and acquisitions in 2008 were not very significant in this climate. The only changes of note were the finalisation of the takeover of the cement manufacturing assets of Orascom by Lafarge, the sale by Lafarge of a 50% stake it held in a joint venture in Egypt with Titan (sold to Titan) and a number of other sporadic acquisitions: Lafarge acquired a stake in the capital of the Algerian company Meftah; CRH acquired 50% of the Indian company Myhome; Holcim acquired a stake in the Chinese company Huaxin; CIMPOR acquired a majority position in the capital of the Indian company Shree Digvijay; and CIMPOR acquired the cement manufacturing assets of Cemex in the Canary Islands.
On the other hand, most of the investments earmarked for organisational growth in a number of emerging markets, which were scheduled to be made in 2008, were either shelved or postponed for significant periods.
CIMPOR made important headway in the development of its growth and internationalization strategy in 2008.
Following the launch of a takeover bid for 20% of the share capital of the Indian company Shree Digvijay Cement Company Limited, listed on the Mumbai Stock Exchange, and the subsequent acquisition of the stake held in that company from Grupo Grasim, CIMPOR gained control of around 73.6% of the capital, for a total price of approximately EUR 73.5 million.
This company has its headquarters in Jamnagar, Gujarat state, and it owns a combined clinker and cement plant located in Sikka, on the Kutch Gulf, where it benefits from an important set of port complexes. The plant has a production capacity close to 1.1 million tons/year.
The CIMPOR Group continued to pursue its expansion strategy in China, through its subsidiary Cimpor Chengtong Cement Corporation, Limited (CCCC). It acquired, at the end of 2008, the entire share capital of the company Liyang Oriental Cement Co. for EUR 22 million.
This company, established at the end of 2003, has a clinker production line with a capacity of 900,000 tons/year, located close to the city of Changzhou, in Jiangsu province. Its natural market encompasses the cities of Wuxi and Suzhou, in one of the Yangtze Delta's major development areas.
The construction of a new combined clinker (5,000 tons/day) and cement (2.4 million tons/year) plant at Shanting, Shandong province, as well as new grinding equipment (1.2 million tons/year) at Huaian, Jiangsu province, began in 2008. The CIMPOR Group's total cement production capacity, using own clinker, in this business area, on completion of the construction work underway (expected to occur before the end of 2009), will be 6 million tons/year.
The CIMPOR Group, under its policy of vertical integration, acquired in March 2008 three concrete plants and 100% of the share capital of four concrete and aggregate companies, operating in the Seville, Córdoba and Huelva regions. These acquisitions, which totalled close to EUR 46 million, considerably strengthened CIMPOR's presence in the Spanish province of Andalusia.
At the end of 2008 CIMPOR also acquired an important set of the assets in the Canary Islands from the company Cemex España, S.A., for around EUR 154 million:
CEISA and its subsidiaries own a number of assets, including:
In the perspective of the deep crisis currently affecting the Iberian market, these new assets represent, besides their own profitability, an important source of synergies, since they guarantee the placing of a significant quantity of clinker with the Group's plants located on the Iberian Peninsula, thus making a decisive contribution to an increased use of the installed capacity.
In addition to the abovementioned acquisitions and investment, other important corporate growth projects started, proceeded or were concluded in 2008:
The CIMPOR Group's cement production capacity, using own clinker, at the end of 2009 should grow in the region of 16%, without any further acquisitions, to exceed 36 million tons/year.
In 2008, CIMPOR Group's consolidated net profit after minority interests was EUR 219.4 million, equivalent to a decrease of around 28% on the previous year.
Three core factors underlay this decrease: the sharp fall in cement consumption in the Spanish market (close to 24%); the decline in cement prices in the Turkey Business Area; and the carrying in the accounts of an impairment loss (in the net amount of EUR 77 million) on the value of the securities portfolio of a Group associate.
| (EUR million) | 2008 | 2007 | Change | 2006 |
|---|---|---|---|---|
| Turnover | 2,088.9 | 1,966.1 | 6.2 % | 1,638.9 |
| Operating Cash Costs | 1,502.5 | 1,359.1 | 10.6 % | 1,075.8 |
| Operating Cash Flow (EBITDA) | 586.3 | 607.0 | - 3.4 % | 563.0 |
| Depreciation & Provisions | 193.7 | 168.9 | 14.7 % | 155.0 |
| Operating Income (EBIT) | 392.6 | 438.1 | - 10.4 % | 408.1 |
| Financial Income | - 134.4 | - 48.0 | n.s. | - 42.3 |
| Pre-tax Income | 258.3 | 390.1 | - 33.8 % | 365.8 |
| Income Tax | 24.9 | 69.3 | - 64.0 % | 60.1 |
| Net Income | 233.3 | 320.8 | - 27.3 % | 305.6 |
| Attributable to: | ||||
| Shareholders | 219.4 | 304.1 | - 27.8 % | 291.9 |
| Minority Interests | 13.9 | 16.7 | - 17.1 % | 13.7 |
| Earnings per share (euros) | 0.330 | 0.454 | - 27.4 % | 0.436 |
In operational terms, and despite the very negative climate that existed in particular in those two markets, the Group's EBITDA, aided by the recovery observed in the final quarter, was almost EUR 586 million, equivalent to a fall of only 3.4%. The quality and high degree of geographical distribution of CIMPOR's portfolio combined with the excellent performance recorded in some Business Areas, permitted that a large part of the decline in these two markets (close on EUR 78 million) was offset.
Brazil and Egypt recorded particularly favourable growth among the referred to Business Areas, with EBITDA growth of 38.5% and 24.9% respectively, equivalent to a combined total of around EUR 43 million. The recent performance of the South Africa Business Area is also to be highlighted, where the Operating Cash Flow almost doubled in the final six months of the year from the first-half of 2008, as the result of the start up of a new clinker production line. However, the strong depreciation of the rand meant that the EBITDA of this Business Area for the year as a whole did not increase by more than 7.3% (whereas it recorded growth of around 34% when reported in the local currency).
| Business | 2008 | 2007 | Change | |||
|---|---|---|---|---|---|---|
| Area | Value | Margin | Value | Margin | Value | % |
| Portugal | 171.9 | 31.4 % | 172.7 | 30.7 % | - 0.8 | - 0.5 |
| Spain | 82.9 | 23.1 % | 137.8 | 29.3 % | - 54.8 | - 39.8 |
| Morocco | 41.0 | 46.1 % | 35.2 | 43.8 % | 5.7 | 16.3 |
| Tunisia | 17.0 | 26.6 % | 18.9 | 31.7 % | - 1.9 | - 10.1 |
| Egypt | 73.2 | 45.4 % | 58.6 | 48.6 % | 14.6 | 24.9 |
| Turkey (1) | 15.6 | 10.0 % | 38.6 | 23.6 % | - 22.9 | - 59.5 |
| Brazil | 102.3 | 25.5 % | 73.9 | 22.9 % | 28.4 | 38.5 |
| Mozambique | 13.6 | 17.6 % | 12.3 | 20.6 % | 1.3 | 10.4 |
| South Africa | 46.2 | 33.4 % | 43.0 | 33.1 % | 3.2 | 7.3 |
| China (2) | 6.3 | 9.5 % | 1.8 | 7.7 % | 4.4 | 238.7 |
| India (3) | 3.1 | 9.7 % | - | - | 3.1 | - |
| Cape Verde | 4.2 | 10.0 % | 3.0 | 9.7 % | 1.3 | 42.2 |
| Trading / Shipping | 7.5 | 6.6 % | 6.3 | 6.0 % | 1.2 | 18.2 |
| Other Activities | 1.5 | - | 4.8 | - | - 3.3 | - 68.3 |
| Total | 586.3 | 28.1 % | 607.0 | 30.9 % | - 20.6 | - 3.4 |
| (1) 2007: March – December | (2) 2007: July – December | (3) April – December |
(EUR million)
The significant and generalised rise in energy costs, the fall in turnover in the Spain Business Area and the decline in cement prices in the Turkish market all drove the EBITDA margin downwards 2.8 p.p. to 28.1%.
The improvements recorded for EBITDA margin in Morocco (2.3 p.p.), Brazil (2.6 p.p.) and China (1.8 p.p.) are to be highlighted, while the significant increase to the margin from the first half of the year to the second half in the South Africa Business Area, as a result of the start up of the new clinker production line, deserves special attention: rising from 24.7% for the first six months of 2008 to 41.3% in the second half of the year.
In spite of the decline in consumption in the markets of Portugal (-8.9%) and, in particular, Spain (-23.6%) cement and clinker sales of the CIMPOR Group, benefiting from the extension of the Group's consolidation perimeter, amounted to around 26.8 million tons in 2008, 9.2% up on 2007.
The significant increases in sales in Brazil (+7.8%), Mozambique (+11.8%), South Africa (+13.2%), Egypt (+13.4%) and Cape Verde (+18.7%), totalling more than one million tons, also deserve highlight, in addition to the contribution from the new Business Areas - China (integrated in July 2007) and India (consolidated from April 2008).
| Business Area | 2008 | 2007 | Change | 2006 |
|---|---|---|---|---|
| Portugal | 5,636 | 6,133 | - 8.1 % | 5,849 |
| Spain | 3,190 | 4,055 | - 21.3 % | 4,235 |
| Morocco | 1,154 | 1,130 | 2.1 % | 1,152 |
| Tunisia | 1,521 | 1,461 | 4.1 % | 1,485 |
| Egypt | 3,200 | 2,822 | 13.4 % | 3,090 |
| Turkey | 2,250 | 2,308 (1) | - 2.5 % | - |
| Brazil | 4,652 | 4,316 | 7.8 % | 3,974 |
| Mozambique | 744 | 665 | 11.8 % | 605 |
| South Africa | 1,641 | 1,450 | 13.2 % | 1,292 |
| China | 2,989 | 1,442 (2) | 107.3 % | - |
| India | 664 (3) | - | - | |
| Cape Verde | 287 | 242 | 18.7 % | 178 |
| Subtotal | 27,929 | 26,025 | 7.3 % | 21,860 |
| (Intragroup Sales) | (1,122) | (1,479) | n.s. | (1,415) |
| Consolidated Total | 26,807 | 24,547 | 9.2 % | 20,445 |
| (1) March – December | (2) July – December | (3) April – December |
(thousand tons)
Ready-mix concrete sales, which were heavily penalised by the crisis of the Iberian market, ended the year only 1.1% below sales in 2007, due to the markedly positive development in the other markets. Aggregate and mortar sales recorded growth in the region of 6.0% and 3.4%, respectively.
| Products / Business Area | 2008 | 2007 | Change | 2006 |
|---|---|---|---|---|
| Concrete (1,000 m3) | ||||
| Portugal | 2,887 | 3,195 | - 9,6 % | 3,137 |
| Spain | 2,382 | 2,965 | - 19.6 % | 2,798 |
| Turkey | 1,360 | 983 * | 38.4 % | - |
| Brazil | 1,241 | 996 | 24.6 % | 698 |
| Other Business Areas | 696 | 525 | 32.5 % | 309 |
| Total | 8,567 | 8,664 | -1.1 % | 6,943 |
| Aggregates (1,000 ton) | ||||
| Portugal | 7,399 | 6,904 | 7.2 % | 7,607 |
| Spain | 5,260 | 5,296 | - 0.7 % | 4,491 |
| Turkey | 2,293 | 1,946 * | 17.8 % | - |
| Other Business Areas | 1,157 | 1,051 | 10.0 % | 889 |
| Total | 16,109 | 15,196 | 6.0 % | 12,987 |
| Mortar (1,000 ton) | 562 | 543 | 3.4 % | 485 |
* March – December
CIMPOR's consolidated turnover in 2008 was close to EUR 2.1 billion, equivalent to an increase of more than 6%. This growth was primarily driven by the new Business Areas of China and India, as well as the significant growth of this indicator in Brazil (+24.7%) and Egypt (+37.5%), which, single-handedly, almost offset the losses recorded in Portugal and Spain (these losses in Portugal and Spain caused the relative weight of these two countries in the Group, excluding domestic transactions, to fall below 40%).
| Business | 2008 | 2007 | Change | |||
|---|---|---|---|---|---|---|
| Areas | Value | % | Value | % | Value | % |
| Portugal | 461.4 | 22.1 | 475.9 | 24.2 | - 14.5 | - 3.1 |
| Spain | 357.8 | 17.1 | 469.6 | 23.9 | - 111.9 | - 23.8 |
| Morocco | 88.8 | 4.3 | 80.5 | 4.1 | 8.4 | 10.4 |
| Tunisia | 64.0 | 3.1 | 59.7 | 3.0 | 4.3 | 7.2 |
| Egypt | 161.2 | 7.7 | 117.3 | 6.0 | 44.0 | 37.5 |
| Turkey (2) | 156.1 | 7.5 | 163.1 | 8.3 | - 6.9 | - 4.2 |
| Brazil | 401.3 | 19.2 | 321.8 | 16.4 | 79.5 | 24.7 |
| Mozambique | 77.4 | 3.7 | 60.1 | 3.1 | 17.3 | 28.8 |
| South Africa | 136.0 | 6.5 | 128.1 | 6.5 | 7.9 | 6.2 |
| China (3) | 64.3 | 3.1 | 23.9 | 1.2 | 40.3 | 168.5 |
| India (4) | 32.3 | 1.5 | - | - | 32.3 | - |
| Cape Verde | 42.1 | 2.0 | 30.5 | 1.5 | 11.6 | 38.1 |
| Trading / Shipping | 45.6 | 2.2 | 34.1 | 1.7 | 11.5 | 33.8 |
| Other Activities | 0.7 | 0.0 | 1.5 | 0.1 | - 1.4 | - 99.2 |
| Consolidated Total | 2,088.9 | 100.0 | 1,966.1 | 100.0 | 122.8 | 6.2 |
(EUR million)
(1) Excluding intra-group transactions (2) 2007: March – December
(3) 2007: July – December (4) April – December
Depreciation and Provisions rose by almost EUR 25 million (14.7%) as a result of the investments made by the Group in the last two years, driving Operating Income down 10.4%.
The recognition of a loss of close on EUR 77 million on the value of shares in Banco Comercial Português, held directly and indirectly by an associate of the Group, impacted on the Financial Income, which was close to negative EUR 134 million. If this exceptional and one-off loss is not considered, the downturn in the Financial Income did not exceed EUR 9 million. Net interest expenses in particular rose only EUR 3.3 million (6.4%), which compares very favourably - in a year of sharp rises in interest rates - to the increase (nearly 18% in terms of annual average balance) of Net Financial Debt.
Income Tax fell by around EUR 44 million, essentially due to the cancellation (close to EUR 50 million) of part of a provision for tax risk. This cancellation was based on a judgment proffered by the 1st Chamber of the Supreme Administrative Court, which was confirmed by the Section's plenary in 2008. The result of this judgement, as CIMPOR had always argued, is that the Public Debt Settlement Fund is liable for any payment of tax arising from additional assessments relative to 1997 and 1998, where such is payable.
Despite the share devaluation by the currencies of Brazil, Turkey and South Africa, the amount of Capital Employed (not considering investments in progress) rose by around EUR 168 million (5.2%) from the end of 2007, to approach EUR 3.4 billion.
| (EUR million) | 2008 | 2007 | Change | 2006 |
|---|---|---|---|---|
| Working Capital | 403.4 | 307.0 | 31.4 % | 256.9 |
| Tangible Fixed Assets | 1,705.3 | 1,682.0 | 1.4 % | 1,422.3 |
| Goodwill | 1,277.0 | 1,283.7 | - 0.5 % | 910.0 |
| Other Assets (net Other Liabilities) | (3.2) | (58.1) | n.s. | (42.0) |
| Capital Employed | 3,382.5 | 3,214.6 | 5.2 % | 2,547.1 |
| Investments in Progress | 302.9 | 213.1 | 42.1 % | 120.1 |
| Financial Investments | 105.2 | 168.4 | - 37.6 % | 171.1 |
| Other Non-Operating Assets (net) | (87.5) | (97.7) | n.s. | (75.3) |
| Invested Capital | 3,703.2 | 3,498.4 | 5.9 % | 2,763.0 |
| Net Financial Debt | 1,862.6 | 1,359.3 | 37.0 % | 865.6 |
| (Available for sale Investments) | (4.1) | (9.8) | n.s. | 0.0 |
| ) Provisions |
74.7 | 71.5 | 4.4 % | 71.4 |
| Financial Debt and Equivalents | 1,933.2 | 1,421.1 | 36.0 % | 937.0 |
| Equity attributable to: | ||||
| Shareholders | 1,505.1 | 1,796.4 | - 16.2 % | 1,579.7 |
| Minorities | 110.7 | 102.9 | 7.6 % | 74.1 |
| Deferred Taxes | 94.3 | 75.1 | 25.7 % | 54.9 |
| Provisions for Taxes and Others | 59.8 | 102.9 | - 41.9 % | 117.4 |
| Equity and Equivalents | 1,770.0 | 2,077.3 | -14.8 % | 1,826.0 |
| Invested Capital | 3,703.2 | 3,498.4 | 5.9 % | 2,763.0 |
| Return on Capital Employed | 10.4 % | 11.6 % | 13.1 % | |
| Return on Equity | 13.3 % | 18.1 % | 18.9 % |
The decline in Operating Income and the value of total investment in fixed assets exceeding EUR 590 million, led to the Return on Capital Employed (after taxes) declining from 11.6% recorded in 2007 to 10.4% in 2008.
Net Financial Debt, including equivalent items, at EUR 1.421 billion at the end of 2007, rose in December 2008 to EUR 1.933 billion - equivalent to growth of around 36%, which is wholly explained by the abovementioned investment effort. As a result, its share of total capital invested between these two dates increased from 41% to a little over 52%.
| Cape Verde | --- | 287 | 71.2% | 42.1 | 4.2 | 3.2 | 2.0 | 19.1 | 1.0 | 138 | 264 | 36 | 10.0% | 7.7% | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| India (2) | 1,165 | 664 | 0.4% | 32.3 | 3.1 | 2.4 | 0.5 | 72.2 | 1.6 | 552 | 78 | 13 | 9.7% | 7.4% | ||
| China | 2,425 | 2,989 | 0.1% | 65.6 | 6.3 | 2.2 | 2.2 | 72.0 | 37.9 | 648 | 105 | 13 | 9.5% | 3.3% | ||
| South Africa | 1,725 | 1,641 | 12.2% | 138.2 | 46.2 | 38.9 | 27.0 | 175.2 | 21.8 | 638 | 225 | 93 | 33.4% | 28.1% | (3) Cement production capacity own clinker (at year's end) | |
| Brazil Mozambique | 710 | 744 | 82.6% | 77.4 | 13.6 | 8.8 | 5.6 | 51.8 | 9.0 | 451 | 177 | 41 | 17.6% | 11.4% | ||
| 6,150 | 4,652 | 8.7% | 401.3 | 102.3 | 70.1 | 58.2 | 740.7 | 43.1 | 1,501 | 280 | 99 | 25.5% | 17.5% | |||
| Turkey | 2,000 | 2,250 | 5.2% | 156.1 | 15.6 | -0.8 | 1.0 | 486.7 | 70.4 | 848 | 188 | 43 | 10.0% | -0.5% | ||
| MAIN BUSINESS AREAS - ACTIVITY IN 2008 Egypt |
3,900 | 3,200 | 8.3% | 161.2 | 73.2 | 58.9 | 65.0 | 256.5 | 5.1 | 488 | 331 | 163 | 45.4% | 36.5% | ||
| Tunisia | 1,600 | 1,521 | 23.5% | 64.0 | 17.0 | 9.3 | 10.3 | 126.4 | 3.2 | 221 | 290 | 93 | 26.6% | 14.6% | ||
| Morocco | 1,295 | 1,154 | 8.0% | 88.8 | 41.0 | 30.5 | 20.1 | 75.6 | 9.3 | 207 | 437 | 226 | 46.1% | 34.4% | (2) April - December | |
| Spain (1) | 3,200 | 3,190 | 7.4% | 358.8 | 82.9 | 47.6 | 19.7 | 652.3 | 35.4 | 991 | 350 | 130 | 23.1% | 13.3% | ||
| Portugal (1) | 6,900 | 5,636 | 54.9% | 546.6 | 171.9 | 117.3 | 2.8 | 616.8 | 31.9 | 1,540 | 354 | 151 | 31.4% | 21.5% | ||
| Units | 103 ton | 103 ton | 106 euros | 106 euros | 106 euros | 106 euros | 106 euros | 106 euros | units | 103 euros | 103 euros | |||||
| Installed Capacity (3) Cement Activity |
Cement and Clinker Sales | Market Share | Overall Activity | Turnover | Operating Cash Flow (EBITDA) | Operating Income (EBIT) | Net Profit Before I.M. | Capital Employed | Industrial Investment | Employees (31 Dec) | Turnover / Employee | Value Added / Employee | EBITDA Margin | EBIT Margin | (1) Excluding areas common to the Group |
* Excluding intragroup transctions
CIMPOR - CIMENTOS DE PORTUGAL, SGPS, S.A. │ GROUP 85
The Portuguese economy will not have grown more than 0.4% in 2008, and it even recorded two successive quarterly falls in the final six months of the year. The stagnation of investment and heavy slowdown in exports (with positive growth of only 0.8% compared to 7.5% achieved in 2007) were the factors that most contributed to this cooling down, though the increase of around 1.3% in private consumption did attenuate the decline to some extent. The annual average inflation rate (2.6%) worsened slightly, while the budget deficit again decreased (from 2.6% of GDP to 2.2% of GDP), contrary to the negative balance of external accounts, which grew from 8.2% to 8.9% of the referred to aggregate.
The overall production indicator for the construction sector fell 1.1% despite the growth observed in the civil engineering (2.1%) and construction of non-residential buildings segments (4.4%). This decline was due to the sharp fall in the housing segment (in the region of 8%, equivalent to the second worst fall since the start of the crisis in the sector, in 2002).
| Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|
| Installed Capacity (1) | 103 ton |
6,900 | 6,820 | 1.2% | 6,850 |
| Use of Installed Capacity (2) | 87.8% | 93.2% | 89.8% | ||
| Cement and Clinker Sales | 103 ton |
5,636 | 6,133 | - 8.1% | 5,849 |
| Market Share | 54.9% | 55.1% | 53.8% | ||
| Concrete Sales | 103 m3 |
2,887 | 3,195 | - 9.6% | 3,137 |
| Aggregate Sales | 103 ton. |
7,399 | 6,904 | 7.2% | 7,607 |
| Mortar Sales | 103 ton. |
175 | 150 | 16.2% | 156 |
| Turnover | 106 euros |
546.6 | 562.6 | - 2.8% | 531.6 |
| Operating Cash Flow (EBITDA) | 106 euros |
171.9 | 172.7 | - 0.5% | 173.9 |
| Operating Income (EBIT) | 106 euros |
117.3 | 117.7 | - 0.3% | 122.2 |
| Capital Employed | 106 euros |
616.8 | 595.6 | 3.6% | 605.8 |
| Industrial Investment | 106 euros |
31.9 | 28.5 | 11.9% | 28.2 |
| Employees (31 Dec) | Units | 1,540 | 1,559 | - 1.2% | 1,572 |
| Turnover/Employee | 103 euros |
354 | 360 | - 1.5% | 328 |
| EBITDA Margin | 31.4% | 30.7% | 32.7% | ||
| EBIT Margin | 21.5% | 20.9% | 23.0% |
(1) Cement production capacity with own clinker (average over year)
(2) Clinker production / Installed capacity (clinker)
This slump in residential construction caused cement consumption of decrease almost 9% (to around 7.2 million tons) and a more or less identical reduction in the sales of the CIMPOR Group in the domestic market (down to 3.95 million tons). Furthermore, exports of cement and clinker fell approximately 5.4%, to total around 1.7 million tons. This fall was primarily due to the contraction of the Spanish market.
Sales of ready-mix concrete fell in 2008 following the slight upturn in 2007, as the annual figure did not exceed 2.9 million cubic metres (9.6% down on the previous year). Aggregate and mortar sales, however, recorded growth in the region of 7.2% and 16.2%, respectively.
Turnover (EUR 547 million) and EBITDA (EUR 172 million) only underwent slight changes, benefiting from the inevitable rise in sale prices caused by the deterioration in energy costs. The respective margin (31.4%) even recorded a slight improvement.
Investment totalled close to EUR 32 million. The investment highlights were the installation of an automatic beam production line (with a production capacity of 700,000 units/year) at Geofer's plant, and the conclusion of some investments started in 2007, namely: The assembly at the Alhandra plant of reception, storage and feeding systems for coal and alternative fuels and animal wastes, and the system for burning hazardous industrial waste at the Souselas plant.
Spain's economy underwent a sharp slowdown in 2008, recording growth of only 1.2% (contrasting with 3.8% growth in 2007) and it clearly entered a technical recession in the last two quarters.
The increase in internal demand did not exceed 0.7% (4.1% in 2007), which was mainly due to the fall in investment. Investment in the construction sector fell 4.3% (residential construction fell 10%). External demand made a positive contribution to the growth of the product for the first time in twelve years, while the record budget surplus of the previous year transformed into a deficit equivalent to 1.6% of GDP. The unemployment rate rose from 8.3% to 11.2% of the active population and the inflation rate increased, in terms of annual average, from 2.8% in 2007 to 4.1% in 2008.
Cement consumption, reflecting the sharp contraction of the real estate market, will not have exceeded 43 million tons, recording a heavy decline (in the region of 24%), especially in the Madrid (33%) and Catalonia (28%) regions. Growth in the markets where the Group operates was, however, quite varied: in Galicia cement consumption will have fallen by around 8.5%, and by nearly 25% in Andalusia and Extremadura combined.
The sales of the CIMPOR Group, against this backdrop, only totalled 3.19 million tons (21.3% down on 2007), which comprised a fall in harmony with market decline in the southern region, and a fall of approximately 15% in the Galicia zone due to increased competition from two new operators. Nonetheless, the Group's national market share rose 0.2 p.p. to close on 7.4%.
Concrete sales also declined heavily (around 20%), to below 2.4 million cubic metres. The sale of aggregates, benefiting from some acquisitions made in Extremadura and Andalusia, remained at practically the same level as the previous year (close to 5.3
million tons). Mortar sales fell by around 15%, and they did not break the 200,000 tons barrier.
| Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|
| Installed Capacity (1) | 103 ton |
3,200 | 2,675 | 19.6% | 2,700 |
| Use of Installed Capacity (2) | 76.7% | 89.3% | 100.5% | ||
| Cement Sales | 103 ton |
3,190 | 4,055 | - 21.3% | 4,235 |
| Market Share | 7.4% | 7.2% | 7.6% | ||
| Concrete Sales | 103 m3 |
2,382 | 2,965 | - 19.6% | 2,798 |
| Aggregate Sales | 103 ton. |
5,260 | 5,303 | - 0.8% | 4,491 |
| Mortar Sales | 103 ton. |
196 | 230 | - 15.0% | 195 |
| Turnover | 106 euros |
358.8 | 470.9 | - 23.8% | 430.5 |
| Operating Cash Flow (EBITDA) | 106 euros |
82.9 | 137.8 | - 39.8% | 143.7 |
| Operating Income (EBIT) | 106 euros |
47.6 | 94.0 | - 49.4% | 109.5 |
| Capital Employed | 106 euros |
652.3 | 449.4 | 45.1% | 486.5 |
| Industrial Investment | 106 euros |
35.4 | 45.1 | - 21.7% | 24.1 |
| Employees (31 Dec) | units | 991 | 998 | - 0.7% | 1,011 |
| Turnover / Employee | 103 euros |
350 | 469 | - 25.3% | 429 |
| EBITDA Margin | 23.1% | 29.3% | 33.4% | ||
| EBIT Margin | 13.3% | 20.0% | 25.4% |
(1) Cement production capacity with own clinker (average over year)
(2) Clinker production / Installed capacity (clinker)
The decline in demand generated an almost general fall in sale prices, which combined with the fall in economic activity led to a decrease of approximately EUR 112 million to turnover. This fact combined with the increase in energy costs and fuel and the irregular operation of the Córdoba and Niebla plants (following the important interventions carried out on these plants in 2007) drove the Operating cash flow generated in the Spain Business Area down by close on EUR 55 million (almost 40%) and the EBITDA and EBIT margins to decrease more than 6 p.p.
The most significant investments made included the conclusion of the projects to expand the clinker production capacity by 400,000 tons/year at the two plants in Andalusia and the undertaking of important acquisitions in the aggregates field.
The Moroccan economy, which heavily depends on domestic demand and, in particular, the good or bad performance of the primary sector, is weathering the impact of the international financial crisis relatively unscathed. The economy recorded a growth rate close to 6% in 2008. The difference to the previous year (when GDP only grew 2.7%) is primarily due to a better agricultural year in 2008 and the favourable growth of some industrial activities, such as the mining of phosphates (Morocco is the world's leading producer) and construction and public works.
The civil construction and public works sector continued to enjoy enormous dynamism, which is clearly reflected in cement consumption of close to 14.1 million tons (9.9% up on 2007).
Asment de Témara's cement sales totalled 1.12 million tons, equivalent to year-on-year growth of 6.6%, despite being restricted by an unscheduled stoppage to one of its grinding units (which stopped for almost a month). Nonetheless, the fall in clinker sales (almost 60%) meant that the overall increase in quantities sold was no more than 2.1%.
| Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|
| Installed Capacity (1) | 103 ton |
1,295 | 1,295 | 0.0% | 1,290 |
| Use of Installed Capacity (2) | 100.0% | 82.2% | 97.2% | ||
| Cement and Clinker Sales | 103 ton |
1,154 | 1,130 | 2.1% | 1,152 |
| Market Share | 8.0% | 8.2% | 8.6% | ||
| Concrete Sales | 103 m3 |
371.3 | 307.0 | 20.9% | 176.6 |
| Aggregate Sales | 103 ton. |
117.8 | 109.8 | 7.2% | 145.7 |
| Turnover | 106 euros |
88.8 | 80.5 | 10.4% | 72.0 |
| Operating Cash Flow (EBITDA) | 106 euros |
41.0 | 35.2 | 16.3% | 33.5 |
| Operating Income (EBIT) | 106 euros |
30.5 | 28.4 | 7.5% | 25.9 |
| Capital Employed | 106 euros |
75.6 | 65.1 | 16.0% | 62.2 |
| Industrial Investments | 106 euros |
9.3 | 8.2 | 13.2% | 4.7 |
| Employees (31 Dec) | units | 207 | 206 | 0.5% | 208 |
| Turnover / Employee | 103 euros |
437 | 398 | 9.8% | 346 |
| EBITDA Margin | 46.1% | 43.8% | 46.5% | ||
| EBIT Margin | 34.4% | 35.3% | 35.9% |
(2) Clinker production / Installed capacity (clinker)
The market's dynamism ensured that Betocim achieved record concrete sales figures in 2008 (371,000 cubic metres), equivalent to growth of more than 20%. Sales of aggregates exclusively for cement production again rose, by about 7.2%, to close to 118 000 tons.
Morocco's consolidated turnover, which surpassed two billion dirhams, in local currency, for the first ever time, was around EUR 90 million, equivalent to an increase of 10.4%. EBITDA in 2008 rose by 16.3% to nearly EUR 41 million, even though Operating Cash Costs recorded growth that, despite the strong rise in fuel prices, did not exceed 6%. As a result, the respective margin rose from 43.8% in 2007 to 46.1% in 2008.
The investment highlights were the commencement of the work to install a third grinding unit (to start up in the second half of 2009), the modernisation of the bagging lines and the construction of the new car park to support the shipping of cement.
The relative soundness of Tunisia's economy, which has been strengthened over the last decade, and the low international exposure of its financial sector allowed GDP growth in 2008 to reach 4.7%, driven by domestic demand and, in particular, by investment. The inflation rate, which had fallen to 3.1% in 2007, began rising again in 2008 (to around 5%), which continued to fuel the devaluation trend of the local currency against the euro.
Consumption of binders (cement and hydraulic lime) totalled approximately 6.3 million tons, an increase of 3.2% on 2007, which in per capita terms, means more than 600 kg per inhabitant. Regionally, the difference between the east coast and the rest of the country is becoming greater, with the region of greater Tunis – where consumption rose by around 7% and close to which the Ciments de Jbel Oust (CJO) plant is located – accounting for close on 37% of the market. The strong growth of exports in 2008 (exceeding 30%) is also to be highlighted. A factor in this growth is that domestic cement prices continue to be set by government, and they are much lower than the prices practised in neighbouring countries.
The sales of CJO – 1.52 million tons (including exports of 48,000 tons) – recorded yearon-year growth of 4.1%, while Turnover grew by 7.2% to nearly EUR 64 million.
Net selling prices did not rise more than 4.3% in annual average terms and in local currency, which strongly contrasts with the rises in energy and fuel prices (above 20%). This fact led the EBITDA generated in this Business Area to fall almost EUR 2 million, causing the respective margin to fall 5 p.p., from 31.7% in 2007 to 26.6% in 2008.
| Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|
| Installed Capacity (1) | 103 ton |
1,600 | 1,560 | 2.6% | 1,560 |
| Use of Installed Capacity (2) | 88.7% | 89.5% | 92.8% | ||
| Cement Sales | 103 ton |
1,521 | 1,461 | 4.1% | 1,485 |
| Market Share | 23.5% | 24.0% | 24.7% | ||
| Turnover | 106 euros |
64.0 | 59.7 | 7.2% | 59.6 |
| Operating Cash Flow (EBITDA) | 106 euros |
17.0 | 18.9 | - 10.1% | 17.5 |
| Operating Income (EBIT) | 106 euros |
9.3 | 10.8 | - 13.7% | 9.7 |
| Capital Employed | 106 euros |
126.4 | 121.5 | 4.0% | 131.8 |
| Industrial Investment | 106 euros |
3.2 | 1.5 | 116.8% | 1.9 |
| Employees (31 Dec) | Units | 221 | 226 | - 2.2% | 231 |
| Turnover / Employee | 103 euros |
290 | 262 | 10.7% | 253 |
| EBITDA Margin | 26.6% | 31.7% | 29.4% | ||
| EBIT Margin | 14.6% | 18.1% | 16.2% |
(2) Clinker production / Installed capacity (clinker)
Total investment in 2008 (EUR 3.2 million) more than doubled from 2007, mainly due to the installation of new palleting equipment and the work to link the silos to the bagging area.
The Egyptian economy once again demonstrated notable growth in 2008 (GDP up by close to 7%). This was sustained by the increase in domestic demand and increased revenue from tourism. The inflation rate, pressurised by the upward trends followed by food goods in international markets and by the reduction of some state subsidies, significantly worsened to exceed 18%.
Cement consumption in 2008 recorded double digit growth (11.5%), just as it had in 2007 (14.4%), to total around 38.4 million tons. 2008 was, nonetheless, not a particularly easy year for the cement industry, given the obstacles created by a number of government decisions, some of which are difficult to comprehend while others are totally unjustified: the 100% increase in the price of mazot (the fuel still used by many plants), straight away in January; the export of cement and clinker was forbidden between April and September; the creation of a tax on the clay consumed in the manufacturing of cement; the rise in the price of electricity and natural gas in July (50% and 75%, respectively); and the levying of heavy fines on the entire sector for allegedly infringing competition legislation.
The sales of the CIMPOR Group totalled 3.2 million tons (13.4% up on the previous year), which, combined with the rise in cement prices, generated an increase in Turnover exceeding EUR 40 million and a rise of close to 25% in Operating Cash Flow. Nevertheless, the EBITDA margin fell by more than 3 p.p. - from 48.6% in 2007 to 45.4% in 2008 - as a result of the referred to rises in costs and despite higher installed capacity use.
| Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|
| Installed Capacity (1) | 103 ton |
3,900 | 3,900 | 0.0% | 3,900 |
| Use of Installed Capacity (2) | 84.0% | 72.7% | 78.2% | ||
| Cement and Clinker Sales | 103 ton |
3,200 | 2,822 | 13.4% | 3,090 |
| Market Share | 8.3% | 7.9% | 8.9% | ||
| Turnover | 106 euros |
161.2 | 120.6 | 33.7% | 127.8 |
| Operating Cash Flow (EBITDA) | 106 euros |
73.2 | 58.6 | 24.9% | 63.3 |
| Operating Income (EBIT) | 106 euros |
58.9 | 46.0 | 27.9% | 50.6 |
| Capital Employed | 106 euros |
256.5 | 238.9 | 7.4% | 225.3 |
| Industrial Investment | 106 euros |
5.1 | 19.2 | - 73.6% | 19.0 |
| Employees (31 Dec) | Units | 488 | 491 | - 0.6% | 491 |
| Turnover / Employee | 103 euros |
331 | 246 | 34.6% | 265 |
| EBITDA Margin | 45.4% | 48.6% | 49.6% | ||
| EBIT Margin | 36.5% | 38.2% | 39.6% |
(1) Cement production capacity with own clinker (average over year)
(2) Clinker production / Installed capacity (clinker)
Investment in 2008 did not surpass EUR 5.1 million, following the conclusion of the revamping of one of the two oldest clinker production lines. The investment mainly entailed a range of interventions essentially aimed at guaranteeing the operational continuity of the equipment and to increase equipment reliability.
The Turkish economy, following clear signs of slowdown in 2007, will not have grown more than 1.7% in 2008, which represents its worst result since the domestic crisis of 2001. The unemployment rate and inflation rate both broke through the 10% barrier, which combined with the climate of political instability in the country, decisively fuelled the sharp deceleration in domestic demand.
The climate of instability heavily deterred the launch of new projects in the residential and infrastructure areas, causing the construction sector to contract by around 1.1%, leading to a 4.5% decline in cement consumption. Additionally, installed capacity underwent significant growth (in the region of 11 million tons/year), which caused, despite the increase of exports (estimated at 59%), a situation of strong competition domestically, which in turn drove prices downwards.
The catchment market of Cimpor Yibitas (Central Anatolia and the Black Sea) contracted at a rate above the national average, causing the company's cement sales (2.25 million tons) to fall by around 8.4%, on a comparable base. The sales of ready-mix concrete, driven by some construction projects started in 2007 and the start up of five new plants, increased by close to 27% on 2007 as a whole, recording total sales of 1.36 million cubic metres. Aggregate sales (totalling almost 2.3 million tons) also recorded notable growth despite the increased competition.
| Unit | 2008 | 2007 (1) | Change | |
|---|---|---|---|---|
| Installed Capacity (2) | 103 ton |
2,000 | 1,680 | 19.0% |
| Use of Installed Capacity (3) | 101.1% | 98.9% | ||
| Cement Sales | 103 ton |
2,250 | 2,308 | - 2.5% |
| Market Share | 5.2% | 5.4% | ||
| Concrete Sales | 103 m3 |
1,360 | 983 | 38.4% |
| Aggregate Sales | 103 ton. |
2,293 | 1,946 | 17.8% |
| Turnover | 106 euros |
156.1 | 163.1 | - 4.2% |
| Operating Cash Flow (EBITDA) | 106 euros |
15.6 | 38.6 | - 59.5% |
| Operating Income (EBIT) | 106 euros |
- 0.8 | 23.3 | -103.5% |
| Capital Employed | 106 euros |
486.7 | 596.1 | - 18.4% |
| Industrial Investments | 106 euros |
70.4 | 18.5 | 281.4% |
| Employees (31 Dec) | Units | 848 | 803 | 5.6% |
| Turnover / Employee | 103 euros |
188 | 255 | - 26.2% |
| EBITDA Margin | 10.0% | 23.6% | ||
| EBIT Margin | neg. | 14.3% | ||
| (1) March – December |
(2) Cement production capacity with own clinker (average over year)
(3) Clinker production / Installed capacity (clinker)
Turnover fell to around EUR 156 million due to the drop in cement sales, the generalised decline in prices and the devaluation of the local currency. These components combined with the rise in cost of the main production factors to cause Operating Cash Flow to decrease by close on 60% and generate a substantial reduction in the respective margin: from 23.6% for the last ten months of 2007 to no more than 10.0% in 2008.
Further to the variety of investments made in sustainability and environmental protection, the work to install a new clinker production line at Hasanoglan (in the Ankara region), proceeded at a good pace and it is expected to be complete by the end of September this year. The functioning of this line will raise the cement production capacity with own clinker of this Business Area by about one million tons/year.
The first nine months of 2008 reported strong growth, benefited by dynamic domestic demand, the increase of household's income and the expansion of credit. In the last quarter, the Brazilian economy will have registered a slight dip, which caused GDP growth to fall to close on 5.3% in 2008. The inflation rate worsened by more than 2 p.p. to about 5.8%, while the local currency rose in value against the US dollar by nearly 14% between January and August, before depreciating by more than 30% from September to the year's end, due to the widespread climate of aversion to risk.
Cement consumption in Brazil in 2008 grew by more than 14%, to surpass 51 million tons, despite undergoing clear deceleration in the last quarter. The sales of CIMPOR – which are limited in some regions by the available production capacity – increased overall by around 7.8% (8.8% in the domestic market). This result signifies a slight loss of national market share.
| Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|
| Installed Capacity (1) | 103 ton |
6,070 | 6,025 | 0.7% | 6,015 |
| Use of Installed Capacity (2) | 78.5% | 73.6% | 63.9% | ||
| Cement Sales | 103 ton |
4,652 | 4,316 | 7.8% | 3,974 |
| Market Share | 8.7% | 9.1% | 9.3% | ||
| Concrete Sales | 103 m3 |
1,241 | 996 | 24.6% | 698 |
| Mortar Sales | 103 ton. |
192 | 163 | 17.8% | 134 |
| Turnover | 106 euros |
401.3 | 322.0 | 24.6% | 270.3 |
| Operating Cash Flow (EBITDA) | 106 euros |
102.3 | 73.9 | 38.5% | 60.6 |
| Operating Income (EBIT) | 106 euros |
70.1 | 37.7 | 85.7% | 35.1 |
| Capital Employed | 106 euros |
740.7 | 842.4 | - 12.1% | 797.9 |
| Industrial Investments | 106 euros |
43.1 | 35.5 | 21.4% | 31.4 |
| Employees (31 Dec) | units | 1,501 | 1,395 | 7.6% | 1,272 |
| Turnover / Employee | 103 euros |
280 | 243 | 15.5% | 224 |
| EBITDA Margin | 25.5% | 22.9% | 22.4% | ||
| EBIT Margin | 17.5% | 11.7% | 13.0% |
(2) Clinker production / Installed capacity (clinker)
In the ready-mix field, the heavy investment made in recent years and the in-depth restructuring of the segment, led, just as in 2007, to a noteworthy increase in sales (24.6%), raising total sales to around 1.24 million cubic metres. Mortar sales rose by around 18%, exceeding 190,000 tons.
The turnover of Cimpor Brasil grew by around 24.6%, exceeding EUR 400 million, due not only to these developments but also an important price recovery (an average recovery in local currency, in the case of cement, in the region of 13%). This fact permitted Operating Cash Flow to rise by 38.5% (to slightly over EUR 100 million) and the respective margin to grow 2.6 p.p., in spite of higher energy prices and higher costs incurred with demurrage during the import of coke.
The contribution from concrete – above EUR 10 million, corresponding to an EBITDA margin of 11.4% – to this sharp improvement in the operating performance of Cimpor Brasil in 2008 deserves particular highlight, given that such contribution has been practically zero or even negative in previous years.
Total investments of EUR 43 million were made, the main highlights being the conclusion of the work to extend clinker production capacity of the Cezarina plant by 450
tons/day, the ongoing investment in one of the rawmix mills at the Cajati plant (with the aim of increasing capacity), the acquisition of a concrete plant in the metropolitan region of São Paulo and the acquisition of a quarry in Paraíba state.
The Mozambican economy likely grew by close to 6% in 2008 (slightly down on 2007), driven by the construction sector and, in particular, the initiation of a number of projects of notable scale on the central and northern regions of the country, and the large number of public works to construct and rehabilitate infrastructures. The inflation rate will have increased by more than 6 p.p., driven by rise in the price of fuel, maritime freight and food goods, reaching an annual average of 14.5%.
Cement consumption increased almost 6% to approximately 900,000 tons, around 744,000 of which (11.8% up on 2007) corresponded to sales of Cimentos de Moçambique (which raised the respective market share to above 80%). Growth in the ready-mix concrete production and marketing activities was even stronger (21.8%) pushing sales to almost 80 000 cubic metres.
The consolidated turnover grew by close on 30% to EUR 77.4 million, as a result of the increased business activity and the repercussions of the increased costs of producing and importing clinker on selling prices. The rise in prices was not, however, sufficient to offset the referred to rise in costs, causing the EBITDA margin to fall back 3 p.p. and an increase of only EUR 1.3 million (10.4%) in Operating Cash Flow. This fact combined with increased amortization generated a 19% fall in Operating Income.
| Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|
| Installed Capacity (1) | 103 ton |
710 | 735 | - 3.4% | 745 |
| Use of Installed Capacity (2) | 45.0% | 41.2% | 20.9% | ||
| Cement and Clinker Sales | 103 ton |
744 | 665 | 11.8% | 605 |
| Market Share | 82.6% | 78.3% | 78.1% | ||
| Concrete Sales | 103 m3 |
78.5 | 64.4 | 21.8% | 52.8 |
| Turnover | 106 euros |
77.4 | 60.1 | 28.8% | 54.5 |
| Operating Cash Flow (EBITDA) | 106 euros |
13.6 | 12.3 | 10.4% | 8.4 |
| Operating Income (EBIT) | 106 euros |
8.8 | 10.9 | - 19.2% | 7.5 |
| Capital Employed | 106 euros |
51.8 | 40.8 | 27.1% | 40.6 |
| Industrial Investments | 106 euros |
9.0 | 4.1 | 118.2% | 4.8 |
| Employees (31 Dec) | Units | 451 | 408 | 10.5% | 497 |
| Turnover/Employee | 103 euros |
177 | 141 | 25.0% | 113 |
| EBITDA Margin | 17.6% | 20.6% | 15.4% | ||
| EBIT Margin | 11.4% | 18.1% | 13.7% |
(2) Clinker production / Installed capacity (clinker)
Most of the total of EUR 9 million of investments made were of an environmental nature. The most important being the intervention on the electro-filter at the Matola plant and also at that plant, the installation of the equipment needed to burn natural gas, a dust removal filter in one of the grinding units and a sleeve filter in the clinker cooler. The start up of the installation of a new grinding unit at Matola and the start of work to rehabilitate the Dondo grinding facility were also highlights of 2008.
The GDP growth rate in South Africa will have been marginally positive, due to the heavy deceleration of economic activity in the second half of 2008. The rise in fuel prices and food goods caused, like in previous years, a significant rise in inflation to nearly 11.5%. This fact together with a slight political instability and a general climate of greater aversion to risk, contributed to an additional devaluation of the rand against the US dollar of around 14.6% and 20.4% against the euro (in terms of average exchange rate for the year).
Investment in construction will have risen 9.8% (well below the 19.3% increase recorded in 2007), and the residential segment even showed a slight decrease. National cement consumption was no greater than 13.5 million tons, thus registering a fall of close to 5%. In KwaZulu-Natal province, where most of the Group's activity is concentrated under NPC-Cimpor, market growth was, contrary to previous years, above the national average, recording growth of 1.6%. That fact plus operational and logistic problems to competitors meant that NPC-Cimpor was able to increase cement sales by more than 13%, to around 1.64 million tons.
| Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|
| Installed Capacity (1) | 103 ton |
1,340 | 1,025 | 30.7% | 1,055 |
| Use of Installed Capacity (2) | 84.6% | 85.5% | 98.7% | ||
| Cement Sales | 103 ton |
1,641 | 1,450 | 13.2% | 1,292 |
| Market Share | 12.2% | 10.2% | 10.2% | ||
| Concrete Sales | 103 m3 |
180 | 93 | 93.5% | 79.8 |
| Aggregates Sales | 103 ton. |
740 | 811 | - 8.8% | 723 |
| Turnover | 106 euros |
138.2 | 129.8 | 6.5% | 119.5 |
| Operating Cash Flow (EBITDA) | 106 euros |
46.2 | 43.0 | 7.3% | 47.9 |
| Operating Income (EBIT) | 106 euros |
38.9 | 38.1 | 2.3% | 39.6 |
| Capital Employed | 106 euros |
175.2 | 156.3 | 12.1% | 164.6 |
| Industrial Investment | 106 euros |
21.8 | 37.5 | - 41.9% | 49.4 |
| Employees (31 Dec) | units | 638 | 580 | 10.0% | 467 |
| Turnover/Employee | 103 euros |
225 | 218 | 3.2% | 260 |
| EBITDA Margin | 33.4% | 33.1% | 40.1% | ||
| EBIT Margin | 28.1% | 29.3% | 33.1% |
(2) Clinker production / Installed capacity (clinker)
The supply of concrete to the new airport at Durban ensured that sales of this product almost doubled, to 180,000 cubic metres. The sale of aggregates (down 9%) was seriously hindered by the electricity supply problems occurring at the start of the year.
The devaluation of the South African currency prevented Turnover from growing more than 6.5% when translated into euros. The increase to Operating Cash Flow was no greater than 7.3%, for the same reason, while the EBITDA margin remained at more or less the same level it had registered in 2007. Even so, profound differences existed between the first and second halves of the year: significant quantities of clinker had to be imported up to June – which restricted the Operating Cash Flow obtained for that period to around EUR 16 million (equivalent to an EBITDA margin of only 24.7%); whereas, in the second half of the year, the start up of the new clinker production line allowed that indicator to rise to EUR 30 million and the EBITDA margin to climb above 40%.
The main focus of investment was the conclusion of that new clinker production line (with a nominal capacity of 1,500 tons/day) and the construction of a new clinker silo.
Latest estimates indicate that GDP in Cape Verde in 2008 will have grown at a rate (6.0%) slightly below that of 2007, mainly due to a certain slowdown in private investment and lower input flows of foreign capital.
Nevertheless, cement consumption – driven by public investment in infrastructures and the implementation of important tourism projects – will have increased around 12%, to over 400,000 tons. The sales of the Group (of cement totally imported from Portugal) recorded even more emphatic growth (18.7%), to attain 287,000 tons (a market share above 70%).
| Unit | 2008 | 2007 | Change | 2006 | |
|---|---|---|---|---|---|
| Cement Sales | 103 ton |
287 | 242 | 18.7% | 178 |
| Market Share | 71.2% | 67.2% | 69.2% | ||
| Concrete Sales | 103 m3 |
66.0 | 60.7 | 8.8% | - |
| Aggregates Sales | 103 ton. |
74.0 | 109.9 | - 32.7% | 20.0 |
| Turnover | 106 euros |
42.1 | 30.5 | 38.1% | 18.0 |
| Operating Cash Flow (EBITDA) | 106 euros |
4.2 | 3.0 | 42.2% | 2.3 |
| Operating Income (EBIT) | 106 euros |
3.2 | 2.2 | 46.3% | 1.3 |
| Capital Employed | 106 euros |
19.1 | 18.3 | 4.7% | 11.6 |
| Industrial Investments | 106 euros |
1.0 | 3.9 | - 75.4% | 0.4 |
| Employees (31 Dec) | units | 138 | 169 | - 18.3% | 88 |
| Turnover/Employee | 103 euros |
264 | 223 | 18.2% | 340 |
| EBITDA Margin | 10.0% | 9.7% | 12.9% | ||
| EBIT Margin | 7.7% | 7.3% | 7.4% |
The conclusion of come works that had begun in 2007 and the interruption or deferral of others meant that concrete sales increased only 8.8%, while the sale of aggregates, hampered by operating and red-tape problems, contracted by 30%.
In 2006 The consolidated turnover exceeded EUR 42 million and the Operating Cash Flow was EUR 4.2 million, generating a slight increase to the EBITDA margin (from 9.7% in 2007 to 10.0% in 2008).
The Chinese economy slowed down slightly in 2008, following five consecutive years of two-digit GDP growth. The latest forecasts indicate real GDP growth of around 9%. Exports and particularly investment (which grew in the region of 25%) remained the main driving forces of economic activity, even though they may have undergone hefty deceleration in the last quarter of 2008.
The high growth rate of the urban population continues to stimulate the construction sector and, in particular, the residential segment, driving cement consumption above 1.4 billion tons. Furthermore, many of the technologically obsolete plants were closed down (which represented a production capacity of around 60 million tons/year) and this together with the start up of new plants increased the market share of new generation installed capacity to above 60%.
| Unit | 2008 | 2007 (1) | |
|---|---|---|---|
| Installed Capacity (2) | 103 ton |
2.425 | 1.210 |
| Use of Installed Capacity (3) | 103,1% | 103,1% | |
| Cement and Clinker Sales | 103 ton |
2.989 | 1.442 |
| Turnover | 106 euros |
65,6 | 23,9 |
| Operating Cash Flow (EBITDA) | 106 euros |
6,3 | 1,8 |
| Operating Income (EBIT) | 106 euros |
2,2 | 0,3 |
| Capital Employed | 106 euros |
72,0 | 45,9 |
| Industrial Investment | 106 euros |
37,9 | 0,4 |
| Employees (31 Dec) | Units | 648 | 623 |
| Turnover/Employee | 103 euros |
105 | 79 |
| EBITDA Margin | 9,5% | 7,7% | |
| EBIT Margin | 3,3% | 1,1% | |
| (1) 2nd half of year |
(2) Cement production capacity with own clinker (average over year)
(3) Clinker production / Installed capacity (clinker)
The CIMPOR Group's cement and clinker sales were close to 3 million tons in 2008, corresponding to more than double the sales achieved in the second half of 2007. The Turnover of the companies in question (taken over at the end of June 2007) exceeded EUR 65 million, generating EBITDA of EUR 6.3 million. The respective margin was subsequently close to 9.5%, which despite showing some improvement, continues to reflect the extremely low prices practised in China.
The main investments in 2008, in addition to acquiring, right at the end of the year, the entire share capital of a company (Liyang) with a clinker production capacity of 900,000 tons/year, were the start of construction work on a new plant at Shanting (Zaozhuang), a new grinding unit at Huaian and the waste heat recovery project at the NLG plant to generate electricity.
The Indian economy also recorded a certain deceleration, primarily due to the slowdown of exports. It is estimated to have grown no more than 6% in 2008 (which contrasts with the growth of close to 10% achieved in the three years previous). The construction sector remained robustly dynamic and cement consumption is forecast to have increased by about 9%, to near on 174 million tons.
Following the acquisition by the CIMPOR Group at the end of the first quarter, from Shree Digvijay, besides exporting approximately 49,000 tons of clinker, it sold a total of 615,000 tonnes of cement in the domestic market, generating a Turnover of close to EUR 32.3 million.
| Unit | 2008 (1) | |
|---|---|---|
| Installed Capacity (2) | 103 ton |
875 |
| Use of Installed Capacity (3) | 81.8% | |
| Cement and Clinker Sales | 103 ton |
664 |
| Market Share | 0.4% | |
| Turnover | 106 euros |
32.3 |
| Operating Cash Flow (EBITDA) | 106 euros |
3.1 |
| Operating Income (EBIT) | 106 euros |
2.4 |
| Capital Employed | 106 euros |
72.2 |
| Industrial Investment | 106 euros |
1.6 |
| Employees (31 Dec) | Units | 552 |
| Turnover/Employee | 103 euros |
78 |
| EBITDA Margin | 9.7% | |
| EBIT Margin | 7.4% | |
| (1) April – December |
(2) Cement production capacity with own clinker (average over year)
(3) Clinker production / Installed capacity (clinker)
Cement prices are controlled by the government and they lagged far behind in accompanying the significant increases in the cost of the main production factors. This fact, allied to the consequences of a serious electrical fault that had occurred in 2007, generated an Operating Cash Flow slightly above EUR 3 million, equivalent to an EBITDA margin of only 9.7%.
In Peru, the activity of the Cementos Otorongo company – the CIMPOR Group holds 80% of this company's share capital – continued to focus of the development of the project to construct an integrated cement and clinker plant in the region of Arequipa, where the company owns a number of mining concessions with sufficient and adequate raw material for such a plant.
The CIMPOR Group also has an important, though minority, shareholding in the company C+PA – Cimento e Produtos Associadas, S.A.. The business activity of that company is to manage a set of equity holdings in companies operating in the cement, concrete and aggregates areas, as well as manage some investments of a financial nature. Eminent among those investments is the ownership of around 100 million shares of Banco Comercial Português, S.A. (equivalent to 2.18% of the share capital). Those shares generated an impairment loss carried in the accounts of C+PA of close to EUR 115 million.
The many subsidiaries include: Arenor, S.L., a Spanish concrete and aggregates company; the Namibian company Karibib Portland Cement, Limited, holding licences that allow it to immediately commence the construction of a cement plant; a 25% stake in the CIMPOR Group's holding for the Chinese market (Sociedade de Investimento Cimpor Macau, S.A.); and the Ukraininga company Cement, Ltd. (100% owned), which owns a cement plant in Odessa with a production capacity of around 425,000 tons/year.
CIMPOR TEC – Engenharia e Serviços Técnicos de Apoio ao Grupo, S.A. has sought, in its fourth year of activity, to internally consolidate the process of certification according to the ISO 9001:2000 standard, which, following the necessary final audit by APCER (The Portuguese Standards and Certification Agency), would be obtained in 2009.
It was also decided in 2008 to create a new structure – the Sustainable Development Advisory Office. The aim of this structure is to coordinate all Group activities concerning that theme, providing the different Business Areas and respective Operating Units with clear guidance on the action to be taken. It is to be highlighted in this context that in 2008, and for the first time, an external entity assessed the occupational health and safety data made available, as has been undertaken, for the past four years, with the CO2 emissions of all the Group's plants.
The drawing up of the "Annual Benchmarking Programme" is one of many tasks performed on an annual basis by the management of the CIMPOR Performance Programme. This benchmarking programme involves the comparison of about two hundred key indicators aimed at measuring the operating performance of the different cement manufacturing plants. This work, which precedes the drawing up of the annual budget and the update of the business plan, allows the managers of the referred to units, supported by CIMPOR TEC, to pinpoint priority lines of action for each unit and the resulting measures to be taken over the next three years, setting these down in the "Performance Improvement Plan.
This Department, through its "Process and Environmental Engineering" area and "Geology and Raw Materials" area, also performed various studies in 2008 to evaluate the process conditions of the different manufacturing units. The aim is to identify the best alternatives for the implementation of the performance improvement actions, capacity increases or undertake new investment. It also carries out research work, operational planning and the control of raw material reserves. A number of significant initiatives were also started, such as the implementation of an Emissions Reporting and Monitoring Manual, a Study of the Mercury Cycle in the Manufacture of Cement, the development of an Atmospheric Emissions Database and the creation of a working party to draw up a set of Guidelines for the Environmental Recovery of Spoilt Areas.
The Investments, Engineering, Equipment and Safety Department continued to provide important coordination and technical assistance services to the different maintenance and investment projects undertaken by the Group, most of which are mentioned in the previous point.
The highlights of the Products, Quality and Staff Technical Training Department included the signing of a partnership contract with Instituto Eduardo Torroja (Spain) for the development of belite cements, the holding of 12 training courses totalling 473 hours and encompassing 83 officers from different countries, and the organisation of the second CIMPOR Group Production Seminar, on the theme of "Process and Quality", and which
was attended by 59 employees (including plant managers and other managers of those areas) from almost all the countries the Group operates in.
Since one of CIMPOR TEC's main duties is to encourage the dissemination of knowledge within the Group, it publishes a monthly Technical Bulletin. This bulletin contains recent news related to the cement business, disseminates CIMPOR's concerns and policies with respect to sustainable development and presents case studies, aimed at sharing and disseminating in-house what are considered to be best practices of the Group.
The CIMPOR Group's Sustainability Report for 2008, which is drawn up in accordance with the directives of the GRI – Global Reporting Initiative and which is published along with this report, refers to these matters in more detail, with special reference to the Group's environmental and social performance. We encourage our shareholders to take the opportunity to read the report (it is also available at our site www.cimpor.pt).
As stated in reports of previous years, CIMPOR firmly supports the concept of Sustainable Development, and the Group strives to marry the excellence of technical, economic and financial performance - decisive factors in the value creation process with an effective stance on social and environmental responsibility.
At the end of the nineteen nineties, after having subscribed to the WBCSD – World Business Council for Sustainable Development, CIMPOR was one of the group of ten companies, from among the world's leading cement companies, that launched the project designated as CSI – Cement Sustainability Initiative. Since then, it has actively taken part in the development of this project and, in particular, the launch in July 2000 of a five-year action plan, "Our Agenda for Action", which identifies six key areas for this business sector in progressing towards a more sustainable society:
A highlight in 2008 is the preparation of a report, in the first of the abovementioned areas, entitled "Getting the Numbers Right", which aims to inventory the CO2 emissions of the world's cement industry, in order to provide a correct assessment of this industry's real contribution to worldwide greenhouse gas emissions. Though the report is still in the final drafting phase, the partial results that have already been disclosed have served as the baseline for establishing national and regional benchmarks in contacts with the different stakeholders.
Significant developments were also recorded in 2008 as regards the establishment of bases for obtaining sectoral agreements from the world's cement industry to limit CO2 emissions in the medium/long-term (the Sectoral Approach); Hence, a model aimed at quantifying and describing the emissions reductions that may be achieved, considering the forecast development of the different variables underlying such emissions, is currently being drawn up.
In the Worker Health and Safety area, the "Safety in the Cement Industry – Guidelines for Monitoring and Reporting" document was reviewed, which allowed concepts to be clarified and the monitoring criteria used to be harmonised.
The CSI Full Report, announcing the results achieved during the first five years of the "Our Agenda for Action" action plan was published in 2008, following the holding of the first CSI Forum in 2007, which aimed to extend the discussion and sharing of knowledge on matters concerning sustainable development.
2008 was also the start of a new period of compliance with the EU-ETS mechanism (European emissions trading scheme) and the Kyoto Protocol (2008-2012). The following table summarises its application at the different industrial units of the CIMPOR Group (Portugal and Spain), in this its initial year:
| Plant / Ton CO2 | Registered Emissions |
Licences Awarded |
Difference |
|---|---|---|---|
| Portugal | |||
| Souselas | 1,665,408 | 1,750,901 | - 85,493 |
| Alhandra | 1,619,196 | 1,748,681 | - 129,485 |
| Loulé | 476,804 | 503,429 | - 26,625 |
| Cabo Mondego | 33,904 | 50,886 | - 16,982 |
| Total Portugal | 3,795,312 | 4,053,897 | - 258,585 |
| Spain | |||
| Toral de los Vados | 721,165 | 695,311 | 25,854 |
| Oural | 376,336 | 363,244 | 13,092 |
| Córdoba | 320,224 | 590,748 | - 270,524 |
| Niebla | 222,619 | 376,466 | - 153,847 |
| Total Spain | 1,640,344 | 2,025,769 | - 385,425 |
| General Total | 5,435,656 | 6,079,666 | - 644,010 |
The market slump in both countries is the main reason for the number of surplus licences, and this excess was further exacerbated in the case of the Córdoba and Niebla plants by the lengthy stoppages recorded at those plants to allow important modernisation work to be performed. For this reason, a total of 285,000 emissions licences were sold in Spain.
At the Alhandra plant in Portugal, the growing consumption of neutral or partially neutral alternative fuels, in terms of CO2 emissions(tyres, animal mass and plant biomass) has permitted the achievement of a thermal substitution rate in the region of 14% and the consequent saving (and sale) of 75,000 licences.
The Souselas plant began the use of hazardous industrial waste as a fuel in 2008, which does not have significant impact on overall CO2 emissions accounting but it does solve the serious environmental problem originated by the generation and accumulation of hazardous industrial waste.
The CIMPOR Group, under its sustainable development policy and aware of the need to link to the social environment it forms a part of and take on its responsibilities to the local populations, has developed a privileged relationship over the years with the communities living around its plants. It undertakes a range of actions of significant importance in the social, education, cultural and sports areas (in addition to those it develops in the environmental field).
Though it is usually the Group companies or its employees that have the initiative (as is the case with the "Connosco" programme), requests for support form a diverse range of collective and individual entities are frequently received. Such entities range from social institutions (e.g. schools, homes for the elderly, hospitals, churches and fire stations) to cultural associations, associations for the disabled, small enterprises in the start-up phase, universities requesting support for scientific projects and many other entities. CIMPOR seeks to respond to such requests, provided that they meet the characteristics defined by the Group - which mainly concern, besides the social and cultural value of the projects and the respective impact on the community in general, criteria such as geographical proximity to any of the Group's operational premises. Its support policy is also not reduced to simple financial assistance or the free supply of the products manufactured.
In effect, the support that the Group increasingly provides tends to value the real involvement with the communities in question, as well as partnerships with governmental and non-governmental organisations, in order to guarantee the existence of the competences required for the good development of the projects and to guarantee the long-term feasibility of the same.
Hence, particular importance is placed on the sense of responsibility demonstrated by the beneficiary entity in the manner in which the project is managed. Therefore, regular progress reports are requested from supported projects. These reports must justify how and the extent to which the funds are being used and encourage the donor companies not only to perform regular inspections of the work in progress and also provide a general appraisal on the same.
The CIMPOR Group, aware of the major human resources challenges it faces in terms of its process of internationalization, it backed the development and consolidation in 2008 of a corporate strategy, embodied in a project called CHESS – Cimpor Human Environment Structures & Systems.
The project was co-ordinated by the Personnel Department and Planning, Control and Information Systems Department of Cimpor Serviços. All Business Areas of the Group participated and collaborated with the project. It basically consists of the creation of a global database that will allow the improvement of the quality of human resources management through:
Other highlights in addition to this project include, in the Recruitment and Integration areas, the endeavours made to promote the Young Engineers Pool, which consists of hiring recently graduated engineers and developing their technical and behavioural skills through their participating in practical and theoretical training courses. Five such programmes started in 2008: two in Portugal and one apiece in Spain, Tunisia and Morocco.
In the Training and Development area – which is currently a key area of the Group's Human Resources – each Business Area developed specific training and qualification processes for the respective workers. Of note in this area was the training in the Safety, Quality and Environment fields. Simultaneously, CIMPOR TEC carried on the implementation of the usual training programme provided to all the Group's technical management staff.
The highlights of the many activities undertaken in 2008 in the different Business Areas are: the definition and dissemination of the Vision, Mission and Values of Cimpor Egipto; the consolidation of the identity of Cimpor Brasil ("Be Cimpor" programme); the design and implementation of a new performance assessment and bonus system in India and Turkey; the establishment of a holiday camp for the children of the staff of Asment de Témara (Morocco); and the drawing up of the Staff Manual for the China Business Area.
The CIMPOR Group's workforce at the end of 2008 was 8,369 workers (not including the staff of the operations acquired in the Canary Islands), spread over 13 countries, as detailed in the following table:
| Permanent | Term Contract |
Workers on Loan |
Total | |
|---|---|---|---|---|
| Central Services (2) | 94 | 4 | 3 | 101 |
| Portugal | 1,348 | 189 | 3 | 1,540 |
| Spain | 875 | 116 | 0 | 991 |
| Morocco | 193 | 12 | 2 | 207 |
| Tunisia | 214 | 7 | 0 | 221 |
| Egypt | 270 | 209 | 9 | 488 |
| Turkey | 841 | 5 | 2 | 848 |
| Brazil | 1,501 | 0 | 0 | 1,501 |
| Peru | 1 | 40 | 1 | 41 |
| Mozambique | 376 | 62 | 13 | 451 |
| South Africa | 515 | 123 | 0 | 638 |
| China | 50 | 598 | 0 | 648 |
| India | 551 | 0 | 1 | 552 |
| Cape Verde | 0 | 137 | 1 | 138 |
| Trading | 4 | 0 | 0 | 4 |
| Total | 6,833 | 1,502 | 34 | 8,369 |
(1) Of companies included in the consolidation
(2) Holding, CIMPOR Inversiones, CIMPOR Investimentos and CimporTec
The workforce increased by 761 in 2008, essentially due to the integration of the new Business Area of India and the expansion of the production and marketing activity of ready-mix concrete in Brazil and Turkey.
Cement clearly remains the main activity of the Group, employing 5,456 workers (almost two-thirds of the total):
Distribution of Employees by Activity (31 Dez 2008)
Around 89% of the total universe of the Group is male. The most common age groups are 40-44 years (15.5%), 45-49 years (14.7%) and 30-34 years (14.4%):
Age Distribution
The CIMPOR Group has been assigning growing importance on the occupational health and safety area (OHS), seeking to implement at all the sites where the Group develops its business, a set of rules and practices aimed at ensuring compliance with its baseline goal, "Zero Accidents, Healthy and Safe Workplace".
The most notable actions implemented in 2008 are:
In addition, the OHS area made a significant communication effort throughout 2008, through the constant dissemination of information, not only of the CIMPOR Group but also of like companies (this included statistical data, good practices, fatal occupational accident reports and the respective instruction).
Despite all the attention given the subject, the number of victims of fatal occupational accidents – most of which (54%) were caused by heavy vehicle traffic – has remained stable for the last three years:
The countries with the highest rates during the period were clearly Mozambique, Brazil and Egypt, with eight, seven and six accidents, respectively (75% of the total).
Another important indicator is the Frequency Rate (number of new cases of occupational accidents implying an absence from work of more than one day per one million hours worked), which has progressively traced out a downward trend:
This trend is true for all activity sectors save the concrete sector:
Frequency Rate/Activity (Direct Employees)
The large volume of investments made by the CIMPOR Group in 2008 led to an increase of close on EUR 500 million in its Net Financial Debt, taking this indicator to approximately EUR 1.86 billion.
The borrowing requirements arising not only from the investments contracted but also from the maturing of some debt instruments led to the contracting of three new important operations in 2008:
Any of these operations – the first two of which are under the amortizing scheme and the last one the bullet scheme – was negotiated before the enormous worsening of spreads that occurred in the last quarter. This fact means that CIMPOR obtained extremely favourable credit conditions in the light of the current climate.
AS regards the management of short-term debt, CIMPOR continues to favour the dynamic use of the credit lines available, aiming to facilitate the movement of funds associated to the refinancing of the loans falling due, ensuring the necessary financial support for any acquisitions and sustaining the intragroup cash support operations carried out by Cimpor Inversiones.
In this context, the contracting in Spain of new back-up lines deserves highlight, which raises the global ceiling available to Cimpor Inversiones and Corporación Noroeste from EUR 380 million, that was in force at the end of 2007, to EUR 487 million as at December 2008.
In parallel, CIMPOR sought to raise the effectiveness of the management of cash surpluses existing in some Business Areas, channelling them either directly or indirectly to where cash shortages exist due to investments being undertaken. This process is never easy given the financial, administrative and tax restrictions that still exist in some countries where the Group operates.
The financial debt at the end of 2008 totalled around EUR 2.152 billion in gross terms, basically divided between four types of instrument: a Eurobond issue (EUR 600 million) launched in 2004, two US Private Placements issues (USD 404 million) placed in 2003; sundry Bank loans (EUR 1,230 billion) and Commercial Paper issued in 2008 (EUR 25 million).
Despite the referred to rise in Net Financial Debt (close to 18% in annual average terms) and the sharp rise in the Euribor rates between the start of 2008 (when the 6-month rate was 4.65%) and the middle of October (when the same rate topped out at 5.40%), the credit conditions underlying the new operations that have been contracted and the careful management of debt in preceding years have allowed the increase in the respective costs to be contained at a little over EUR 3 million (including the impact arising from the application of IAS 39).
It is also to be noted that despite the increase of debt and the slight deterioration in the Group's operating income, CIMPOR continues to comply with all the financial covenants established in the contracts in force, even though the margin is much lower than that existing in previous years. This narrowing of the differential between the ratios presented and the respective contractual limits, allied to fears of a greater deterioration of the Group's operating income, considering the worsening of the international economic climate, caused Standard & Poor's to place CIMPOR's rating on Credit Watch towards the end of the year. This has negative implications and, at the start of 2009, the Company's rating was lowered from BBB to BBB- (and it remained on credit watch with a negative outlook).
Below is a table summarizing the Group's main financial operations reported in its consolidated liabilities:
| Financing | Currency | Value (103 ) |
Start | Maturity | Interest Rate |
|---|---|---|---|---|---|
| CIMPOR Inversiones Bilateral Loan Bilateral Loan |
EUR EUR |
280,000 200,000 |
Nov 2007 Jan 2008 |
Nov 2012 Jan 2013 |
Euribor + 0.275% Euribor + 0.275% |
| Bilateral Loan | EUR | 225,000 | Jun 2008 | Mar 2011 | Euribor + 0.750% |
|---|---|---|---|---|---|
| Bilateral Loan | EUR | 300,000 | Aug 2008 | Jun 2010 | Euribor + 0.550% |
| Sundry Financing | EUR | 571 | - | - | - |
| Impact of IAS 39 | EUR | - 1,441 | - | - | - |
| Total | EUR | 1,004,130 | |||
| CIMPOR B.V. | |||||
| Eurobonds | EUR | 600,000 | May 2004 | May 2011 | 4.500% |
| US PP 10y US PP 12y |
USD USD |
150,000 254,000 |
Jun 2003 Jun 2003 |
Jun 2013 Jun 2015 |
4.750% 4.900% |
| Impact of IAS 39 | EUR | - 29,054 | |||
| Total | EUR | 915,656 | |||
| Portugal | |||||
| BEI Financing | EUR | 46,667 | Sept 2003 | Sept 2015 | EIB Basic Rate |
| Commercial Paper | EUR | 25,000 | Dec 2008 | Jan 2009 | 3.290% |
| Sundry Financing | EUR | 5,572 | - | - | - |
| Overdraft | EUR | 3,488 | - | - | - |
| Total | EUR | 80,726 | |||
| Spain | |||||
| Sundry Financing | EUR | 73,578 | - | - | - |
| Overdraft | EUR | 29 | - | - | - |
| Total | EUR | 73,607 | - | - | - |
| Morocco | |||||
| Sundry Financing | MAD | 23,127 | - | - | - |
| Sundry Financing | MAD | 38,809 | - | - | - |
| Total | EUR | 5,586 | |||
| Turkey | |||||
| Overdraft | EUR | 4,800 | - | - | - |
| Overdraft | TRY | 65,074 | - | - | - |
| Total | EUR | 35,084 | |||
| Brazil | |||||
| Sundry Financing | BRL | 32,131 | - | - | - |
| Total | EUR | 9,906 | |||
| South Africa | |||||
| Overdraft | ZAR | 952 | - | - | - |
| Total | EUR | 73 | |||
| China | |||||
| Sundry Financing | CNY | 29,800 | - | - | - |
| Total | EUR | 3,138 | |||
| India | |||||
| Bilateral Loan | INR | 1,000,000 | Mar 2008 | Mar 2011 | 10.500% |
| Total | EUR | 14,838 | |||
| Peru | |||||
| Sundry Financing | PEN | 5,855 | - | - | - |
| Total | EUR | 1,340 | |||
| Cape Verde | |||||
| Sundry Financing | EUR | 239 | - | - | - |
| Sundry Financing | CVE | 3,300 | |||
| Overdraft | CVE | 96,809 | - | - | - |
| Total | EUR | 1,147 | |||
| Various | |||||
| Financial Leasing | EUR | 6,771 | - | - | - |
| Group Total | EUR | 2,152,002 | |||
As part of its normal operations, the CIMPOR Group is faced with various financial risks as a result of exposure to fluctuations in the local currency exchange rates in countries in which it operates. It is also exposed to euro and US dollar interest rate changes, the main currencies in which its financial debt is held.
To mitigate the potential impact of any unfavourable changes in these factors, management policy is abides with the following basic principles:
With respect to this last point, attention is drawn to the use of a particularly relevant statistical measure for derivative portfolio management, known as Earnings-at-Risk. This indicator forecasts the portfolio's maximum negative impact in terms of results for a three-month time frame, with 95% accuracy. It provides an ongoing analysis for the portfolio and assesses the extent to which this impact may or may not be lessened by contracting certain operations.
Regarding exchange risk management, the two cross-currency swaps (USD/EUR) associated with the private placements issued in June 2003 on the US market were kept. The policy of hedging the risks relative to the intragroup loans contracted by Group companies operating outside the Euro Zone was also maintained, provided the local market conditions permit such.
In the area of interest rate risk, the Group continued its dynamic management of the portfolio of derivatives not classified as hedging instruments, aiming to minimise its global cost and to balance the cash flow / market value ratio. In the hedging portfolio, the weight of Eurobonds - issued at a fixed rate in 2004 - was increased, from 25% to 50%, and hedged by variable rate swap operations, as a means of taking advantage of the reduction to market rates that occurred at the end of the year.
The operating risk management policy of the Group was not significantly changed in 2008, with self-insurance being kept at the same level as in previous years and "major risks" being insured with international insurance companies.
When renegotiating insurance policies within the CIMPOR Group's global programmes, and despite the fact that the main companies involved continued to make very demanding conditions for their renewal, substantial reductions in the premiums for material damage and third party liability policies were once again obtained.
The Group's "captive" reinsurance company – CIMPOR Reinsurance, based in Luxembourg – continued to directly assume material damage and machine breakdown risks, with compensation limits up to two million euros. It also handled third party liability and product liability, with compensation limits up to two hundred and fifty thousand euros. Above these sums, cover remained with international reinsurance companies.
In 2008 the global third party liability insurance of CIMPOR's directors and managers was renegotiated, and even with the difficult market conditions the same cover was maintained as in previous years, but for a lower premium.
Personal, vehicle and other miscellaneous insurance cover required by the different business areas was kept with local firms, in accordance with the specific laws of each country and the contractual conditions of employees.
2009 is shaping up to be quite gloomy, with the world economy facing serious recession risks, though deflation is less probable. Unless the current tension as regards financial markets in substantially mitigated, the international economic climate will be marked by the retraction of growth, the reduction of world trade and credit access difficulties, with increased unemployment leading to a sharper contraction of private consumption.
In more developed countries, strongly affected by the serious crisis in the financial system, GDP is expected to fall, according to the OECD's latest forecasts, by as much as 4% in the USA and Euro Zone and around 6.5% in Japan. Though the main emerging economies may initially suffer from the impact of that contraction - especially those most dependent on exports and external financing flows - but they should maintain relatively strong growth rates (i.e. such being the case with India and China, which have estimated GDP growth rates of 4.3% and 6.3%, respectively)
In this climate, the construction sector will probably record its worst year since 1991, and world cement consumption will probably record, for the first time, zero or almost zero growth: the expected advance for the African markets (above 10%) and in Asia (6.5%, excluding Japan) will probably not be enough to offset the decline (in the region of 9 to 12%) in the US, UK and Euro Zone markets.
It is natural in these latter markets that the under-use of installed capacity as well as the recent drop in maritime freighting (favouring imports) will pressurise selling prices and, consequently, reduce operating margins, though this should be offset by the sharp fall in the cost of fuel.
In the CIMPOR Group, the expected EBITDA increases in Egypt, South Africa, China and India should be enough to offset any possible declines in Portugal and Spain, allowing the Group Operating Cash Flow to at least reach the level achieved in 2007 (above EUR 600 million).
The recession that the two Iberian countries are currently experiencing indicates a fall in cement consumption of around 6% in Portugal and more than 20% in Spain, which, combined with the export difficulties (given the contraction of demand), foresees a decline in the joint EBITDA for these two Business Areas of around EUR 40 million. This reduction would be even more significant had not CIMPOR recently acquired all of Grupo Cemex's operations in the Canary Islands which, besides their own profitability, guarantee the placing of a significant quantity of clinker with the Group's plants located on the Iberian Peninsula, thus allowing them to make greater use of the installed
capacity.
In Morocco and Tunisia, cement consumption should continue its growth trend, though at a slower rate, despite the international economic climate - which will primarily impact on exports and revenue from tourists and transfers of money into the country from emigrants working abroad. The update of prices that is expected (mainly in Tunisia) and the fall in fuel prices should allow both Business Areas to increase their operating income.
In Egypt, the cement market continues to show enormous robustness, meaning growth rates that, at least in the first half of the year, will probably be double-digit. If the current prices and local currency exchange rate remain unchanged, the EBITDA in this Business Area may increase by more than EUR 20 million.
In Turkey, however, the latest estimates indicate a fall in GDP of between 1 and 2%, and a decline in cement consumption of around 10% - given the excess installed capacity, and the difficulty in absorbing that decline through exports, given the slowdown in demand in neighbouring countries – which continues to place pressure on cement prices. In this context, the conclusion of the investment at Hasanoglan, scheduled for the end of the third quarter, may not be sufficient to prevent a new decline in Operating Cash Flow.
In Brazil, even though the reduction of foreign demand may lead to economic growth almost stagnating, the construction and public works sector should continue to benefit from the current cycle of low interest rates and the economic stimuli established in the Growth Acceleration Programme (PAC). It is expected that the EBITDA of Cimpor Brasil will significantly improve in local currency, if the recovery of selling prices continues and fuel prices remain low. Nonetheless, in view of the recent depreciation of the currency, the euro value f EBITDA may not grow significantly.
In Mozambique, the public works ready to start and the continuation of some private projects currently underway should continue to sustain the growth of the construction sector and, according, cement consumption. Nonetheless, the recent government decision to remove the surcharge that had existed on the import of cement may lead to a loss of market share and greater pressure on cement prices, with an inevitable impact on operating margins.
In South Africa, the latest estimates indicate GDP growth close to zero, and a 10% decline in cement consumption is envisaged. Nevertheless, the new clinker production line in full operation may ensure that this Business Area's contribution to the Group's EBITDA may be one of the most significant.
Public investment in Cape Verde, which is very focused on expanding and improving port infrastructures, will certainly not be sufficient to offset the strong contraction in private consumption. Sales are expected, therefore, to fall sharply, especially concrete sales.
The slowdown of both the Chinese and Indian economies will have an affect on construction and, consequently, on cement consumption. It is forecast that the cement consumption will only grow by no more than 4% in both countries. The EBITDA of these two Business Areas should, however, grow strongly: In India, through the already visible improvement in operating performance, allied to the fact that 2009 will be the first full year of integration in the Group; in the case of China, through the effect of the recent acquisition of a new company and the fact that the units currently in the final phase of construction will soon start-up.
The following significant events took place after the end of the 2008 financial year:
Lisbon, 24 April 2009
Ricardo Manuel Simões Bayão Horta
Luís Eduardo da Silva Barbosa Jacques Lefèvre
Jean Carlos Angulo Jorge Manuel Tavares Salavessa Moura
Luís Filipe Sequeira Martins Manuel Luís Barata de Faria Blanc
Pedro Maria Calaínho Teixeira Duarte Vicente Árias Mosquera
José Manuel Baptista Fino José Enrique Freire Arteta
(THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY)
| Operating income: Sales 7 1,981,645 1,806,747 Services rendered 7 107,217 159,310 Other operating income 8 65,601 47,519 Total operating income 2,154,464 2,013,577 Operating expenses: Cost of goods sold and material used in production 9 (630,936) (539,317) Changes in inventories of finished goods and work in progress 26,954 6,620 Supplies and services (708,514) (641,657) Payroll costs 10 (224,875) (207,070) Depreciation and amortisation 7,17 and 18 (184,573) (165,052) Provisions and impairment losses 7,18 and 35 (9,129) (3,808) Other operating expenses 11 (30,749) (25,163) Total operating expenses (1,761,822) (1,575,447) Net operating income 7 392,642 438,130 7 and 12 (187,816) (158,794) Financial expenses Financial income 7 and 12 138,627 100,490 7,12 and 19 (86,735) 8,025 Share of profits of associates Other investment income 7 and 12 1,537 2,291 Profit before income tax 258,255 390,142 Income tax 7 and 13 (24,949) (69,341) Net profit for the year 233,306 320,802 7 Attributable to: Equity holders of the parent 219,441 304,073 Minority interest 7 and 32 13,865 16,729 233,306 320,802 Earnings per share: Basic 15 0.33 0.45 Diluted 15 0.33 0.45 |
Notes | 2008 | 2007 |
|---|---|---|---|
The accompanying notes form an integral part of the consolidated financial statements for the year ended 31 December 2008.
Ricardo Manuel Simões Bayão Horta
Luís Eduardo da Silva Barbosa Jacques Lefèvre
Luís Filipe Sequeira Martins Manuel Luís Barata de Faria Blanc
Pedro Maria Calaínho Teixeira Duarte Vicente Arias Mosquera
José Manuel Baptista Fino José Enrique Freire Arteta
Jean Carlos Angulo Jorge Manuel Tavares Salavessa Moura
(Tra ns la tion from th e Po rtu gue se s o rigin al - No te 50 )
| Notes | 2008 | 2007 | |
|---|---|---|---|
| Non-current assets: | |||
| Goodwill | 16 17 |
1,277,008 | 1,283,741 |
| Intangible assets | 18 | 42,530 | 13.302 |
| Tangible assets Investments in as sociates |
7 and 19 | 2,007,926 97,663 |
1,895,055 163,533 |
| Other investments | 20 | 131,395 | 164,314 |
| Accounts receivable-other | 21 | 10,883 | 11,880 |
| Taxes recoverable | 22 | 16,349 | 20,488 |
| Other non-current as sets | 23 | 33,874 | 4,655 |
| Deferred tax as sets | 24 | 103,039 | 123,185 |
| Total non-current assets | 3,720,666 | 3,680,155 | |
| Current assets: | |||
| Invento rie s | 25 | 327,849 | 230,569 |
| Accounts receivable-trade | 26 | 313,443 | 323,861 |
| Accounts receivable-other | 21 | 29,633 | 22,800 |
| Taxes recoverable | 22 | 43,349 | 29,860 |
| Cash and cash equivalents | 45 | 169,564 | 540,250 |
| Other current as sets | 23 | 10,751 | 6,474 |
| Total current as sets | 894,589 | 1,153,813 | |
| Total ass ets | $\overline{7}$ | 4,615,255 | 4,833,968 |
| Shareholders' equity: | 27 | 672.000 | 672.000 |
| Share capital | 28 | ||
| Treasury shares Currency translation adjustments |
29 | (41, 640) | (19, 927) 183,834 |
| Reserves | 30 | (149, 706) 283,112 |
|
| Retained earnings | 31 | 521,858 | 271,950 384,470 |
| Net profit for the year | 15 | 219,441 | 304,073 |
| Equity before minority interest | 1,505,065 | 1,796,401 | |
| Mino rity interest | 32 | 110,720 | 102,880 |
| Total share holders' equity | 1,615,786 | 1,899,281 | |
| Non-current liabilities: Defe rred tax liabilities |
24 | 197,388 | 198,249 |
| Employee benefits | 33 and 35 | 16,642 | 17,028 |
| Provis ions | 35 | 152,374 | 190,965 |
| Loans | 36 | 1,911,130 | 1,324,247 |
| Obligations under finance leases | 37 | 4,670 | 6,305 |
| Accounts payable-other | 40 | 19,515 | 20,814 |
| Taxes payable | 22 | 1,499 | 1.817 |
| Other non-current liabilities | 41 | 115,193 | 169,147 |
| Total non-current liabilities | 2,418,411 | 1,928,574 | |
| Current lia bilities: | |||
| Employee benefits | 33 and 35 | 4.685 | 2.060 |
| Provisions | 35 | 2,140 | 3,139 |
| Accounts payable-trade | 42 | 207,187 | 196,243 |
| Acco unts payable-other | 40 | 58,986 | 73,336 |
| Taxes payable | 22 | 41,135 | 44,967 |
| Loans | 36 | 201,501 | 623.481 |
| Obligations under finance leases | 37 | 2,102 | 1.946 |
| Other current liabilities | 41 | 63,325 | 60.942 |
| Total current liabilities | 581,059 | 1,006,113 | |
| Total liabilities | $\overline{7}$ | 2,999,470 | 2,934,687 |
| Total liabilities and shareholders' equity | 4,615,255 | 4,833,968 | |
The ac c ompany ing notes f or m an integr al par t of the c ons olidated f inanc ial s tatements f or the y ear ended 31 Dec ember 2008.
The Boa rd of Dire ctors
L uís Edu ardo d a Silva Barbo sa Jacqu es Le fèvre
Jea n Carlos An gulo Jo rg e Man ue l Tavares S alave ss a Mou ra
L uís Filip e Se qu eira Martin s
Ped ro Ma ria Ca laính o Teixe ira Du arte Vicen te Arias Mo sq ue ra
Jo sé Ma nu el Ba ptista Fino Jo sé E nriq ue Freire Arteta
Ma nu el L uís Ba ra ta d e Fa ria Blanc
(T ra nslati on from the Portugu eses ori ginal - Note 50)
| Note s | 2008 | 2007 | ||
|---|---|---|---|---|
| Operating a ctivities: | ||||
| Receipts from clients | 2,447,674 | 2,278,931 | ||
| Payments to suppliers | ||||
| (1, 535, 342) | (1,312,633) | |||
| Payments to employees Cash flow s generated by operations |
(223,001) | (204, 186) 762,112 |
||
| 689,331 | ||||
| Income tax recovered/(paid) | (63, 144) | (66, 902) | ||
| Other payments related to operating activities | (196, 820) | (202, 898) | ||
| Cash flows from operating activities | (1) | 429.367 | 492.313 | |
| In vesting activities: | ||||
| Receipts relating to: | ||||
| Changes in the consolidation perimeter | 5 | 429 | 6.464 | |
| Investments | 9.018 | 1,509 | ||
| Tangible assets | 6,335 | 5,493 | ||
| Investment subsidies | 868 | 2,281 | ||
| Interest and similar in come | 34.683 | 27,556 | ||
| Dividends | 1.513 | 2,570 | ||
| Others | 137 | 9,146 | ||
| 52,983 | 55,018 | |||
| Payments relating to: | ||||
| Changes in the consolidation perimeter | 5 | (316, 218) | (522, 466) | |
| Investments | 45 | (36, 295) | (22, 999) | |
| Tangible assets | (305, 887) | (214, 578) | ||
| Intangible assets | (6, 127) | (1,834) | ||
| Others | (323) | (1,825) | ||
| (664, 850) | (763, 703) | |||
| Cash flows from investing activities | (2) | (611, 867) | (708, 684) | |
| Financing activities: | ||||
| Receipts relating to: | ||||
| Loans obtained | 45 | 1,156,341 | 819,333 | |
| Sale of treasury shares | 4,856 | 4,227 | ||
| 1,161,197 | 823,560 | |||
| Payments relating to: | ||||
| Loans obtained | 45 | (1,066,468) | (290, 904) | |
| Interest and similar costs | (114, 691) | (93, 845) | ||
| Dividends | 14 | (153, 151) | (143, 951) | |
| Purchase of treasuryshares | (25, 586) | (14, 371) | ||
| Others | (16, 858) | (3,741) | ||
| (1, 376, 754) | (546, 812) | |||
| Cash flows from financing activities | (3) | (215, 557) | 276,748 | |
| Variation in cash and cash equivalents $(4) = (1) + (2) + (3)$ | (398, 057) | 60,377 | ||
| Effect of currency translation and other non m onetary transactions | 5,255 | (5,583) | ||
| Cash and cash equivalents at the beginning of the year | 45 | 519,280 | 464,486 | |
| Cash and cash equivalents at the end of the year | 45 | 126,479 | 519,280 |
Th e a cco mpan ying not es f orm an in teg ral part of t he con solid ate d f ina ncial sta teme nts f or th e y ea r en ded 31 Dec embe r 20 08.
The Board o f Dire ctors
Ricardo Manuel Sim ões Ba yão Horta
Luís Ed uardo da Silva Barbosa Ja cques Lefèvre
Pedro Maria C alaín ho Teixeira Duarte Vice nte Aria s Mo squera
José Manu el Bapti sta Fi no Jo sé Enrique Freire Arteta
Jean Carlos Angulo Jorge Manuel Tavares Sala vess a Mo ura
Luís F ilipe Se queira Martin s Manuel Luís Barata de F aria Blanc
| Notes | 2008 | 2007 | |
|---|---|---|---|
| Variation in fair value of cash flow hedging financial instruments | 30 | 3,265 | (8,709) |
| Variation in fair value of available-for-sale financial assets | 30 | 258 | 2,098 |
| Actuarial gain and loss on employee benefit plans | 30, 31 and 32 | (3, 167) | 6,568 |
| Variation in currency translation adjustments | 29 and 32 | (330, 755) | 60,942 |
| Adjustments in investments in associates and others | 30 and 31 | (3, 296) | 3,212 |
| Net income recognised directly in shareholders' equity | (333, 695) | 64,111 | |
| Transfers: | |||
| Transfer from shareholders' equity to gain and losses of | |||
| variation in fair value of cash flow hedging financial instruments | 30 | (884) | |
| Transfer from shareholders' equity to gain and losses of | |||
| variation in fair value of available-for-sale financial assets | 30 | (1, 994) | |
| Consolidated net profit for the year | 233,306 | 320,802 | |
| Total recognised income and expense for the year | (102, 383) | 384,028 | |
| Attributable to: | |||
| Equity holders of the parent | (118, 972) | 368,920 | |
| Minority interest | 16,589 | 15,108 | |
| (102, 383) | 384,028 |
The accompanying notes f orm an integral part of the cons olidated f inancial statements f or the year ended 31 December 2008.
The Board of Director s
Ricardo Manuel Simões Bayão Horta
Luís Eduardo da Silva Barbosa
Jean Carlos Angulo
Luís Filipe Sequeira Martins
Pedro Maria Calaínho Teixeira Duarte
José Manuel Baptista Fino
Manuel Luís Barata de Faria Blanc
Vicente Arias Mosquera
Jos é Enrique Freire Arteta
Jorge Manuel Tavares Salavessa Moura
Jacques Lef èvre
| 1. | Introductory note 130 | |
|---|---|---|
| 2. | Summary of significant accounting policies 130 | |
| 2.1. Basis of presentation 130 | ||
| 2.2. New accounting standards and its impact in the financial statements 130 | ||
| 2.3. Critical accounting judgements/estimates 132 | ||
| 2.4. Consolidation principles 133 | ||
| 2.5. Intangible assets 136 | ||
| 2.6. Tangible assets 137 | ||
| 2.7. Leases 138 | ||
| 2.8. Impairment of non-current assets, excluding goodwill 138 | ||
| 2.9. Foreign currency assets, liabilities and transactions 139 | ||
| 2.10. Borrowing costs 140 | ||
| 2.11. Government grants 140 | ||
| 2.12. Inventories 140 | ||
| 2.13. Segment reporting 141 | ||
| 2.14. Balance sheet classification 141 | ||
| 2.15. Net operating income 141 | ||
| 2.16. Provisions 141 | ||
| 2.17. Financial instruments 142 | ||
| 2.18. Retirement benefits 145 | ||
| 2.19. Healthcare benefits 146 | ||
| 2.20. Share-based payments 146 | ||
| 2.21. Contingent assets and liabilities 147 | ||
| 2.22. Revenue recognition and accruals basis 147 | ||
| 2.23. Impairment and adjustments of financial assets 147 | ||
| 2.24. Income tax 148 | ||
| 2.25. Earnings per share 148 | ||
| 2.26. Subsequent events 149 | ||
| 2.27. CO2 emission licences – Emissions market 149 | ||
| 3. | Changes in policies, estimates and errors 149 | |
| 4. | Companies included in the consolidation 150 | |
| 4.1. | Companies consolidated in accordance with the full consolidation method 150 | |
| 4.2. | Associated companies 164 | |
| 4.3. | Companies consolidated in accordance with the proportional method 166 | |
| 5. | Changes in the consolidation perimeter 167 | |
| 6. | Exchange rates used 169 | |
| 7. | Segment reporting 170 | |
| 8. | Other operating income 172 | |
| 9. | Cost of goods sold and material used in production 173 | |
| 10. | Payroll costs 173 | |
| 11. | Other operating expenses 174 | |
| 12. | Net financial expenses 175 | |
| 13. | Income tax 176 | |
| 14. | Dividends 178 | |
| 15. | Earnings per share 179 | |
| 16. | Goodwill 180 | |
| 17. | Intangible assets 182 | |
| 18. | Tangible assets 183 | |
| 19. | Investments in associates 184 | |
| 20. | Other investments 185 | |
| 21. | Accounts receivable - other 186 | |
|---|---|---|
| Adjustments to accounts receivable - other 186 | ||
| 22. | Taxes recoverable and taxes payable 187 | |
| 23. | Other current and non-current assets 188 | |
| 24. | Deferred taxes 188 | |
| 25. | Inventories 189 | |
| Inventory adjustments 190 | ||
| 26. | Accounts receivable – trade 190 | |
| Adjustments to accounts receivable - trade 191 | ||
| 27. | Share capital 192 | |
| 28. | Treasury shares 192 | |
| 29. | Currency translation adjustments and hedges 192 | |
| 30. | Reserves 193 | |
| 31. | Retained earnings 194 | |
| 32. | Minority interest 194 | |
| 33. | Employee benefits 194 | |
| 34. | Incentive plan 198 | |
| 35. | Provisions 200 | |
| 36. | Loans 202 | |
| Bonds 203 | ||
| Bank loans 203 | ||
| Rating 205 | ||
| Control of the subsidiary companies 205 | ||
| Financial covenants 205 | ||
| Negative pledge 206 | ||
| Cross default 206 | ||
| 37. | Obligations under leases 206 | |
| Finance leases 206 | ||
| Operating leases 206 | ||
| 38. | Derivative financial instruments 207 | |
| 39. | Financial risk management 210 | |
| 40. | Accounts payable - other 218 | |
| 41. | Other current and non-current liabilities 218 | |
| 42. | Accounts payable - trade 218 | |
| 43. | CO2 emission licences 219 | |
| 44. | Financial assets and liabilities according to IAS39 220 | |
| 45. | Notes to the consolidated cash flow statements 221 | |
| Cash and cash equivalents 221 | ||
| Receipts / Payments relating to loans 221 | ||
| Payments relating to investments 221 | ||
| 46. | Related parties 222 | |
| Benefits of the members of the Company's corporate boards and executive seniors 223 | ||
| 47. | Contingent liabilities, guarantees and commitments 223 | |
| 48. | Subsequent events 225 | |
| 49. | Financial statements approval 226 | |
| 50. | Note added for translation 226 |
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2008 (Amounts stated in thousands of euros) (Translation of notes originally issued in Portuguese – Note 50)
Cimpor - Cimentos de Portugal, SGPS, S.A. ("the Company") was incorporated on 26 March 1976, with the name Cimpor - Cimentos de Portugal, E.P.. The Company has undergone several structural and legal changes, which have resulted in it becoming the parent company of a Business Group with operations in Portugal, Spain, Morocco, Tunisia, Egypt, Turkey, Brazil, Peru, Mozambique, South Africa, China, India and Cape Verde (the "Cimpor Group").
Cimpor Group's core business is the production and sale of cement. The Group also produces and sells aggregates and mortar in a vertical integration of its businesses.
The Cimpor Group's investments are held essentially through two sub-holding companies; (i) Cimpor Portugal, SGPS, S.A., which holds the investments in companies dedicated to the production of cement, mortar, concrete parts and related activities in Portugal; and (ii) Cimpor Inversiones, S.A., which holds the investments in companies operating abroad.
The accompanying financial statements were prepared on a going concern basis from the books and accounting records of the companies included in the consolidation (Note 4), restated in the consolidation process to the International Financial Reporting Standards, effective for the years beginning 1 January 2008. Such standards include the International Financial Reporting Standards ("IFRS") issued by the International Accounting Standards Board ("IASB"), the International Accounting Standards ("IAS") issued by the Accounting Standards Committee ("IASC") and the interpretations issued by the International Financial Reporting Interpretation Committee ("IFRIC") and Standing Interpretation Committee ("SIC"). These standards and interpretations are hereinafter referred to collectively as "IFRS".
The financial statements were prepared in accordance with the historical cost convention, except as regards financial instruments. Following is a summary of the main accounting policies adopted.
In 2007 was endorsed by the European Union, the IFRS 8 - Operating segments, which is effective for annual periods beginning on or after 1 January 2009. During 2008 and up to the approval date of these financial statements, the European Union endorsed the following accounting standards and interpretations, which will be applicable for annual periods beginning on or the following effective dates:
Effective date IAS 39/IFRS 7 – Financial assets reclassification (reviewed) Jul-08 IFRIC 13 – Customer loyalty programs Jul-08 IFRIC 14 – IAS 19: The limit on a defined benefit asset, minimum funding requirements and their interaction Jan-08 IFRS 8 – Operating segments Jan-09 IFRS 2 – Share-based payment (reviewed) Jan-09 IAS 1 – Presentation of financial statements (reviewed) Jan-09 IAS 23 – Borrowing costs (reviewed) Jan-09 IAS 32/IAS 1 – Puttable instruments and obligations arising on liquidation Jan-09 IFRS annual improvements (2007) Jan-09 IFRS 1/IAS 27 – Cost of a subsidiary in the separate financial statements of a parent on firsttime adoption of IFRS Jan-09 IFRIC 12 – Service concession arrangements Jan-10
The application of IFRIC 14 and IFRIC 13, in 2008, didn't have any impacts in the consolidated financial statements.
Except for IAS 23, which the Group decided to adopt in advance and prospectively from the year of 2008, the remaining standards endorsed by the European Union mentioned above haven't been adopted by the Group in 2008, due to its non mandatory application in this annual year and because the Group has decided not to earlier application.
Significant impacts aren't predicted in the Group financial statements due to the adoption of those standards.
The following accounting standards and interpretations have already been issued at this time, although they haven't yet been endorsed by the European Union:
| Effective date | |
|---|---|
| IFRS 3 – Business combinations (reviewed) | Jul-09 |
| IFRS 1 – First-time adoption of international financial reporting standards (reviewed) | Jul-09 |
| IAS 27 – Consolidated and separate financial statements (reviewed) | Jul-09 |
| IAS 39 – Eligible hedged items | Jul-09 |
| IAS 39 – Reclassifications of financial assets (reviewed) | Jul-09 |
| IFRS 7 – Enhancing disclosures about fair value and liquidity risk (reviewed) | Jan-09 |
| IFRIC 15 – Agreements for the construction of real estate | Jan-09 |
| IFRIC 16 – Hedges of a net investment in a foreign operation | Oct-08 |
| IFRIC 17 – Distributions of non-cash assets to owners | Jul-09 |
| IFRIC 18 – Transfers of assets from customers | Jul-09 |
It's not likely that from the future adoption of the standards above occur significant impacts in the consolidated financial statements.
The preparation of financial statements in accordance with IFRS recognition and measurement principles requires the Board of Directors to make judgements, estimates and assumptions that can affect the amount of assets and liabilities presented, the disclosure of contingent assets and liabilities as of the date of the financial statements, as well as of income and expenses.
These estimates are based on the best knowledge existing at each moment and the planned actions, and are regularly reviewed based on the information available. Changes in facts and circumstances can lead to a revision of the estimates and so actual results may differ from these estimates.
The significant estimates and assumptions made by the Board of Directors in preparing these financial statements include assumptions used in estimating the following items:
• Impairment of non current assets
The determination of a potential impairment loss can arise as result from the occurrence of several events, many of them external to the Cimpor Group, such as future availability of financing, capital cost or any other changes, either internal or external, to Cimpor Group.
The identification of impairment indicators and the determination of the assets' recoverable amount, are subject of a high level of Management judgements referring to the identification and evaluation of the different impairment indicators, expected cash flows, applicable discount rates, useful lives and transaction values.
• Impairment of goodwill
Goodwill is subjected to annual impairment tests or whenever there are indications of a possible loss in value, in accordance with the policy mentioned in Note 16. The recoverable amounts of the cash-generating units to which goodwill has been allocated, is the higher between the market value, determined according with transaction multiples, and the value in use, determined according to the expected cash flows. The calculation of these amounts requires the use by the Management of estimates regarding the future evolution of the activity and the discount rates considered.
• Useful lives of intangible and tangible fixed assets
The useful life of an asset is the time period during which an entity expects that an asset will be usable and it must be reviewed at least at the end of each economical year.
The determination of the assets useful lives, amortization/depreciation method to apply and of the estimated losses resulting from the early replacement of equipments, due to technological obsolescence, is essential to determine the amount of amortization/depreciation charge to the consolidated income statement of each year.
These parameters are defined according to Management's best estimate, for the assets and businesses in question, considering as well the best practices adopted by companies operating in the same sectors.
Cimpor Group periodically analyses possible obligations that arise from past events that should be recognized or disclosed. The subjectivity inherent to the determination of the probability and amount of internal resources required to settle the obligations, might lead to significant adjustments, either by the variation of the assumptions used or by the future recognition of provisions previously disclosed as contingent liabilities.
• Recognition of deferred tax assets
Deferred tax assets are only recognised when there is reasonable expectation that there will be sufficient future taxable income to utilise them or when there are deferred tax liabilities whose reversal is expected to occur in the same period of the reversal of the deferred tax assets. The carrying amount of deferred tax assets is reviewed by Management at the end of each reporting period and takes into consideration the expectation about the future performance of the company.
• Accounts receivable impairment
The credit risk associated to accounts receivable is evaluated at the end of each reporting period, taking into account the debtor's historical information and his risk profile. The accounts receivable are adjusted by the assessment performed by the Management of the estimated collection risks at the balance sheet dates, which might differ from the effective risk to incur.
• Retirement and healthcare benefits
An actuarial valuation made by independent experts and based on economic and demographic indicators is performed each year in order to assess the liabilities resulting from retirement and healthcare benefits granted to Group's employees.
Controlled companies have been consolidated in each period using the full consolidation method. Control is considered to exist where the Group holds, directly or indirectly, a majority of the voting rights at Shareholders' General Meetings, or has the power to determine the companies' financial and operating policies.
Third party participation in shareholders' equity and net profit of such companies is presented separately in the consolidated balance sheet and consolidated statement of profit and loss under the caption "Minority interest".
Where losses attributed to minority shareholders exceed the minority interest in shareholders' equity of controlled companies, the Group absorbs such excess and any additional losses, except where the minority shareholders are required and are able to cover such losses. If the subsidiary subsequently reports profits, the Group appropriates them up to the amount of the losses absorbed by the Group.
The results of controlled companies acquired or sold during the period are included in the statement of profit and loss from the date of their control is obtained to the date of their control is lost.
Significant balances and transactions between controlled companies were eliminated in the consolidation process. Capital gains within the Group on the sale of subsidiary and associated companies are also eliminated. Whenever necessary, adjustments are made to the financial statements of subsidiary and associated companies to conform to the Group's accounting policies.
Where the Group has, in substance, control over other entities created for a specific purpose, even though it does not have direct participations in them, they are consolidated by the full integration method.
Investments in jointly controlled companies are consolidated in accordance with the proportional consolidation method as from the date joint control is acquired. Under this method, assets, liabilities, income and expenses of these entities are included in the accompanying consolidated financial statements, caption by caption, in proportion to the Group's control.
The excess of cost over the fair value of the identifiable assets and liabilities of jointly controlled companies as of the acquisition date is recognised as Goodwill. If the difference between cost and the fair value of the net assets acquired is negative, it is recognised as income for the period.
Transactions, balances and dividends distributed between these companies are eliminated in proportion to the Group's control.
Classification as a jointly controlled investment is determined by the contractual arrangements undertake on the economic activity that is subject to joint control.
Business combinations, namely the acquisition of controlled and subsidiary companies are recorded in accordance with the purchase method. Cost corresponds to the sum of the fair values of the assets acquired less the liabilities incurred or assumed and the equity instruments issued in exchange for the control acquired as of the transaction date plus any costs directly attributable to the purchase process.
The identifiable assets, liabilities and contingent liabilities of a subsidiary that meet the criteria to be recognised in accordance with IFRS 3 - Business Combinations, are measured by their fair value as of the purchase date, except for non current assets (or groups of assets) that are identified
as held for sale in accordance with IFRS 5 – Non-current Assets Held for Sale and Discontinued Operations, which are recognised and measured by their respective fair values less costs to sell.
Any excess of cost over the fair value of the identifiable net assets acquired as of the purchase date is recorded as Goodwill. Where cost is lower than the fair value of the net assets identified, the difference is recorded as a gain in the statement of profit and loss for the period in which the acquisition is made.
Minority shareholders' interest is reflected in proportion to the fair value of the assets and liabilities identified.
An associated company is one over which the Group exercises significant influence, but does not have control or joint control, through participation in decisions relating to its financial and operating policies.
Investments in the majority of associated companies (Note 19) are recorded in accordance with the equity method, except where they are classified as held for sale. Investments are initially recorded at cost which is then increased or decreased by the difference between cost and the proportional value of the equity of such companies as of the purchase date or the date the equity method was first used.
In accordance with the equity method investments are adjusted periodically by the amount corresponding to participation in the net results of associated companies by corresponding entry to Share of profit of associates (Note 12) and by other changes in shareholders' equity by corresponding entry to Adjustments in investments in associates, reflected as Reserves, as well by recognition of impairment losses.
Losses in associated companies in excess of the investment in them are not recognised, unless the Group has assumed commitments to that associate.
Any excess of cost over the fair value of the identifiable net assets is recorded as Goodwill. Where cost is less than the fair value of the net assets identified, the difference is recorded as a gain in the statement of profit and loss for the period in which the acquisition is made.
In addition, dividends received from these companies are recorded as decreases in the amount of the investments.
Unrealised gains on transactions with associated companies are eliminated in proportion to the Group's interest in such companies, by corresponding entry to the amount of the corresponding investment. Unrealised losses are also eliminated, but only up to the point in which the loss does not show that the asset transferred is in a situation of impairment.
Goodwill represents the excess of cost over the fair value of the identifiable assets and liabilities of a controlled, associated company or jointly controlled entity, as of the date of acquisition.
Goodwill is recorded as an asset and is not amortised, being reflected in a separate balance sheet caption or in the caption Investments in associates (Notes 16 and 19). Periodically, or whenever there are indications of a possible loss in value, goodwill is subjected to impairment tests. Any impairment loss is immediately recorded as a cost in the statement of profit and loss for the period and is not subject to subsequent reversal.
Goodwill is included in determining the gain or loss on the sale of a subsidiary, associated company or jointly controlled entity.
As a result of the exception established in IFRS 1, the Group applied the provisions of IFRS 3 – Business Combinations, to acquisitions after 31 December 1998. Goodwill on acquisitions after that date is restated to the currency of the subsidiary and translated to the Group's reporting currency (euros) at the rate of exchange on the balance sheet date.
Exchange differences arising on that translation are recorded in the caption Currency translation adjustments.
Exchange differences generated prior to 1 January 2004 were recorded directly in Retained earnings, in accordance with IFRS 1.
Goodwill on acquisitions prior to 1 January 1999 was maintained at the former amount, being subject to annual impairment tests as from that date.
Where cost is less than the fair value of the net assets identified, the difference is recorded as a gain in the statement of profit and loss for the period in which the acquisition takes place.
Intangible assets, which comprise essentially contractual rights and costs incurred on specific projects with future economic value, are stated at cost less accumulated amortisation and impairment losses. Intangible assets are only recognised if it is probable that they will produce future economic benefits for the Group, they are controllable by the Group and their value can be determined reliably.
Internally generated intangible assets, namely current research and development costs, are recognised as costs when incurred.
Internal costs relating to the maintenance and development of software are recorded as costs in the statement of profit and loss when incurred, except where such costs relate directly to projects
which will probably generate future economic benefits. In such cases these costs are capitalised as intangible assets.
Amortisation of such assets is provided on a straight-line basis as from the date the assets start being used, in accordance with their estimated useful life.
Tangible assets used in production, rendering services or for administrative use are stated at cost, including expenses incurred with their purchase, less accumulated depreciation and, where applicable, impairment losses.
Assets relating to the cement operations on 1 January 2004 were revalued as permitted by the transition provisions of IFRS 1, the resulting amount being considered as the new cost.
Depreciation of tangible fixed assets is provided on a straight-line basis over their estimated useful lives, as from the date the assets become available for their intended use, in accordance with the following estimated periods of useful life:
| Average | |
|---|---|
| useful life | |
| Buildings and other constructions | 10 – 50 |
| Basic equipment | 7 – 30 |
| Transportation equipment | 4 – 8 |
| Tools and dies | 2 – 8 |
| Administrative equipment | 2 – 14 |
| Other tangible fixed assets | 2 – 10 |
The amount subject to depreciation does not include the estimated residual value of the assets at the end of their useful lives. Additionally, the assets stop being depreciated when they are classified as assets held for sale.
Land used for quarries is depreciated over its estimated period of operation.
Improvements are only recognised as assets when they increase the useful life or efficiency of the assets, resulting in increased future financial benefits.
Tangible assets in progress correspond to tangible assets under construction/promotion and are recorded at cost less possible impairment losses. These assets are depreciated as from the date they become available for their intended use.
Gains and losses arising from the sale or write-off of tangible assets, which are determined by the difference between the proceeds of the sale of the assets and their net book value at the date of
sale/write-off, are recognised in the statement of profit and loss caption Other operating income or Other operating expenses.
Lease contracts are classified as: (i) finance leases, if substantially all the risks and benefits of ownership are transferred under them; and (ii) operating leases, if substantially all the risks and benefits of ownership are not transferred under them.
Leases are classified as finance or operating leases based on the substance and not form of the contract.
Fixed assets acquired under finance lease contracts, as well as the corresponding liabilities are recorded in accordance with the financial method. In accordance with this method the fixed assets are recorded as tangible assets, the corresponding liability is recognised and the interest included in the lease instalments and depreciation of the assets, calculated as explained above, are recognised in the statement of profit and loss for the period to which they relate.
In the case of operating leases, the lease instalments are recognised, on a straight- basis, in the statement of profit and loss over the period of the lease contracts.
Impairment valuations are made whenever an event or change in circumstances is identified that indicates that the book value of an asset may not be recovered. Where such indications exist, the Group determines the recoverable value of the asset, so as to determine the possible extent of the impairment loss. In situations in which the individual asset does not generate cash flows independently of other assets, the recoverable value is estimated for the cash generating unit to which the asset belongs.
Whenever the book value of an asset exceeds its recoverable amount, an impairment loss is recognised by charge to the statement of profit and loss caption Provisions and impairment losses.
The recoverable amount is the higher between the net selling price (selling price, less costs to sell) and the usable value of the asset. Net selling price is the amount that would be obtained from selling the asset in a transaction between knowledgeable independent entities, less the costs directly attributable to the sale. Usable value is the present value of the estimated future cash flows resulting from the continued use of the asset and sale thereof at the end of its useful life. The recoverable amount is estimated for each asset individually or, where this is not possible, for the unit generating the cash flows to which the asset belongs.
Impairment losses recognised in prior periods are reversed when there are indications that such losses no longer exist or have decreased. Impairment losses are reversed by credit to the statement of profit and loss caption Provisions and impairment losses. However, the impairment loss is
reversed up to the amount that would have been recognised (net of amortisation or depreciation) if the impairment loss had not been recorded in prior periods.
Transactions in currencies other than euro are recorded at the rates of exchange in force on the date of the transaction. Foreign currency monetary assets and liabilities at the balance sheet dates are translated to euros at the rates of exchange in force on that dates. Non monetary assets and liabilities recorded at their fair value in foreign currencies are translated to euros using the rate of exchange in force on the date the fair value was determined.
Exchange gains and losses resulting from differences between the exchange rates in force on the dates of the transactions and those in force on the dates of collection, payment or the balance sheet date are recognised as income or costs in the consolidated statement of profit and loss, except for those relating to non monetary items where the change in fair value is recognised directly in shareholders' equity (Currency translation adjustments), namely:
The foreign currency financial statements of subsidiary and associated companies are translated as follows: assets and liabilities at the exchange rates in force on the balance sheet dates; shareholders' equity captions at the historical exchange rates; and statement of profit and loss and statement of cash-flow captions at the average exchange rates.
The exchange effect of such translations after 1 January 2004 is reflected in the shareholders' equity caption Currency translation adjustments in the case of subsidiary companies and in the shareholders' equity caption Reserves - Adjustments in investments in associates in the case of investments in associated companies, and is transferred to the statement of profit and loss caption Financial expenses or Financial income when the corresponding investments are sold.
In accordance with IAS 21, goodwill and fair value corrections determined on the acquisition of foreign entities are considered in the reporting currency of such entities, and are translated to euros at the exchange rate in force on the balance sheet date. Exchange differences arising from these translations are reflected in the caption Currency translation adjustments.
The Group contracts financial derivative hedging instruments when it wishes to reduce its exposure to exchange rate risk.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2008 (Amounts stated in thousands of euros) (Translation of notes originally issued in Portuguese – Note 50)
Costs incurred on loans obtained directly to finance the acquisition, construction or production of assets that necessarily take a substantial period of time to get ready for its intended use or sale (qualifying assets) are capitalised as part of the cost of the assets during that period.
To the extent that variable interest rate loans, attributable to finance the acquisition, construction or production of qualifying assets, are being covered through a cash flow hedge relation, the effective portion of fair value of the derivative financial instrument is recognized in Reserves and transferred to profit and loss when the qualifying asset has an impact on results.
Additionally, to the extent that fixed interest rate loans are used to finance a qualifying asset are covered by a fair value hedge relation, the financial burden in addition to the cost of the asset should reflect the interest rate covered.
Any financial income generated by loans obtained in advance to finance specific capital expenditure is deducted from the capital expenditure subject to capitalisation.
Subsidies are recognised based on their fair value, when there is reasonable certainty that they will be received and that the Group will comply with the conditions required for them to be granted.
Operating subsidies, namely those for employee training, are recognised in the statement of profit and loss in accordance with the costs incurred.
Investment subsidies relating to the acquisition of tangible fixed assets are recorded in the caption Other non-current liabilities and are recorded to the statement of profit and loss on a consistent straight-line basis in proportion to depreciation of the subsidised assets.
Merchandise and raw, subsidiary and consumable materials are stated at average cost.
Finished and semi-finished products and work in progress are stated at production cost, which includes the cost of the raw materials incorporated, labour and production overheads.
Inventories are reduced in value where market value is lower than book value, the reduction being reversed when the reasons that gave rise to it cease to exist.
A business segment is a distinguishable component of an entity that is engaged in providing a product or service or a group of related products or services which are different from those of other business segments. A geographical segment is a group of assets and operations involved in the supply of products and services within a particular economic environment that is subject to risks and returns that are different from those operating in other economic environments.
The Group presents as main segments the geographical segments, following the way Management carries out businesses.
Assets to be realised and liabilities to be settled within one year of the balance sheet date are classified as current.
Net operating income includes operating income and expenses, whether recurring or not, including restructuring costs and operating income and expenses associated to tangible assets and intangible assets. Also comprise, gains or losses on the sale of companies consolidated using the full or proportional integration method. The net financial expenses, share of results of associates, other financial investment (Notes 12, 19 and 20) and income tax, are excluded.
Provisions are recognised when: (i) exists an obligation (legal or implicit) resulting from a past event; (ii) under which it is probable that it will have an outflow of resources to resolve the obligation; and (iii) the amount of the obligation can be reasonably estimated. At each balance sheet date provisions are reviewed and adjusted to reflect the best estimate as of that date.
When one of the conditions described is not completed the Group disclosures the events in question as contingent liabilities, unless the possibility of outflow of resources is remote, in which case they are not subject to disclosure.
Provisions for restructuring costs are recognised by the Group whenever there is a formal detailed restructuring plan which has been communicated to the parties involved.
In accordance with current legislation and practices in force in several business areas in which the Group operates, land used for quarries must be environmentally rehabilitated.
In this respect, provisions are recorded to cover the estimated cost of environmentally recovering and rehabilitating the land used for quarries, whenever this can be reasonably determined. Such provisions are recorded together with a corresponding increase in the amount of the underlying assets, based on the conclusions of landscape rehabilitation studies, being recognised in the statement of profit and loss as the corresponding assets are depreciated.
In addition, the Group has the procedure of progressively rehabilitating the areas freed up by the quarries, using the recorded provisions.
Financial assets and liabilities are recognised when the Group becomes a party to the contractual relationship.
The caption Cash and cash equivalents includes cash, bank deposits, term deposits and other treasury applications which mature in less than three months, and are repayable on demand with insignificant risk of change in value.
The caption Cash and cash equivalents in the statement of cash flows also includes bank overdrafts, which are included in the balance sheet in the caption Loans.
Accounts receivable are measured at fair value when they are initially recognised and are subsequently stated at amortised cost in accordance with the effective interest rate method. When there is evidence that the accounts receivable are impaired, the corresponding adjustment is recorded by corresponding charge to the statement of profit and loss. The adjustment is recognised and measured by the difference between the book value of the accounts receivable and the present value of the cash flows discounted at the effective interest rate determined upon initial recognition of the accounts receivable.
Investments are recognised (and derecognised) as of substantially all the risks and benefits of ownership are transferred under them, irrespective of the settlement date.
Investments are initially recognised at cost, which is the fair value of the price paid, including transaction costs.
Investments are classified as follows:
Held-to-maturity investments are classified as non current assets, except if they mature in less than twelve months from the balance sheet date, investments with a defined maturity date which the Group intends and has the capacity to hold up to that date being recorded in this caption. These investments are recognised at amortised cost, using the effective interest rate, net of capital repayments and interest received. Impairment losses are recognised in the statement of profit and loss when the recorded amount of the investment is lower than the estimated value of the cash flows discounted at the effective interest rate determined at the time of initial recognition. Impairment losses can only be reversed subsequently when there is an increase in the recoverable amount of the investment can be objectively related to an event occurring after the date in which the impairment loss was recognised. In any case the recognised amount of the investment cannot exceed the amount corresponding to amortised cost of the investment had the impairment loss not been recognised.
After initial recognition, assets measured at fair value through profit and loss and available-forsale financial assets are revalued to fair value by reference to their market value as of the balance sheet date with no deduction for transaction costs that could arise up to the date their sale. Investments in equity instruments not listed on regulated markets, where it is not feasible to estimate their fair value on a reliable basis, are maintained at cost less possible impairment losses.
Available-for-sale financial assets are classified as non current assets. Gains and losses due to changes in the fair value of available-for-sale financial assets are reflected in the shareholders' equity caption "Fair value reserve" until the instrument is sold, collected or in any other way realised, or where impairment losses are believed to exist, in which case the accumulated gain or loss is recorded in the statement of profit and loss.
Those who do not have listed in an active market and whose fair value cannot be reliably measured are kept at cost adjusted for estimated impairment losses.
Financial liabilities and equity instruments issued by the Group are classified in accordance with the substance of the contract independently of its legal form. Equity instruments are contracts that have a residual interest in the Group's assets after deduction of the liabilities.
Equity instruments issued are recorded at the amount received net of costs incurred to issue them.
Loans are initially recorded as liabilities at the amount received, net of loan issuing costs, which corresponds to their fair value on that date. Loans are subsequently measured at amortised cost, being the corresponding financial costs calculated at the effective interest rate, except as follows:
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2008 (Amounts stated in thousands of euros) (Translation of notes originally issued in Portuguese – Note 50)
Accounts payable are initially recognised at fair value and subsequently measured at amortised cost in accordance with the effective interest rate method.
The Group has the policy of resorting to financial derivative instruments to hedge the financial risks to which it is exposed as a result of changes in interest and exchange rates.
In this respect, the Group does not contract derivative financial instruments for speculation purposes.
The Group resorts to financial derivative instruments in accordance with internal policies set and approved by the Board of Directors.
Financial derivative instruments are measured at fair value. The method of its recognition depends on the nature and purpose of the transaction.
Derivative financial instruments are designated as hedging instruments in accordance with the provisions of IAS 39, as regards their documentation and effectiveness.
Changes in the fair value of derivative instruments designated as fair value hedges are recognised as financial income or expense for the period, together with changes in the fair value the asset or liability subject to the risk.
Changes in the fair value of derivative financial instruments designated as cash flow hedging instruments are recorded in the caption Reserves - Hedging operations as regards their effective component and in financial income or expense for the period as regards their non effective component. The amounts recorded under Hedging operations are transferred to the statement of profit and loss in the period in which the effect on the item covered is also reflected in the statement of profit and loss.
Changes in the value of derivative financial instruments hedging net investments in a foreign entity, are recorded in the caption Currency translation adjustments as regards their effective component. The non effective component of such changes is recognised immediately as financial income or expense for the period. If the hedging instrument is not a derivative, the corresponding
variations resulting from changes in the exchange rate are recorded in the caption "Currency translation adjustments".
Hedge accounting is discontinued when the hedging instrument matures, is sold or exercised, or when the hedging relationship ceases to comply with the requirements of IAS 39.
Changes in the fair value of derivative financial instruments which are contracted for financial hedging purposes in accordance with the Group's risk management policies, but do not comply with all the requirements of IAS 39 to qualify for hedge accounting, are recorded in the statement of profit and loss for the period in which they occur.
Treasury shares are recorded at cost, as a decrease in shareholders' equity. Gains and losses on the sale of treasury shares are recorded in the caption Reserves.
The fair value of financial assets and financial liabilities is determined as follows:
The fair value of derivative financial instruments is calculated using market prices. Where such prices are not available, fair value is determined based on discounted cash flows, which includes some assumptions that are supportable by observable market prices or rates.
Retirement benefits are recorded in accordance with IAS 19 - Employee benefits.
Costs of these benefits are recognised as the services are rendered by the beneficiary employees.
Therefore, at the end of each accounting period actuarial valuations are obtained from independent entities to determine the amount of the liability as of that date and the pension cost to be recognised in the period, in accordance with the "projected unit credit" method. The liability thus
estimated is compared with the market value of the pension fund, so as to determine the amount of the difference to be recorded in the balance sheet.
As established in the above mentioned standard, pension costs are recognised in the caption Payroll costs, based on the amounts determined on an actuarial basis, and include current service costs (increase in the liability), which corresponds to the additional benefits accrued to the employees during the period and interest costs, which result from updating the past service liability. These amounts are reduced by the estimated return on the assets relating to the plan. Actuarial gains and losses are recorded directly in Reserves.
Past service costs are recognised immediately, as the related benefits have already been recognised or, alternatively, recognised on a straight-line basis over the estimated period in which they are obtained.
Contributions made by the Group to defined contribution plans are recorded as costs when they are due.
Some Group companies provide supplementary healthcare benefits to their employees in addition to those provided by the Public Social Security, extensive to their families, early retired and retired personnel. The liability resulting from these benefits is recorded in a similar manner to the retirement pension liability, in the caption "Payroll costs - healthcare benefits", except for the ones relating to actuarial gains and losses, which are recorded in Reserves.
As in the case of retirement benefits, actuarial valuations made by an independent entity are obtained at the end of each accounting period, so as to determine the amount of the liability as of that date.
Share-based payments to employees, according to incentive share purchase plan and share option plan, are recorded in accordance with IFRS 2 - Share-based payment.
In accordance with IFRS 2, equity settled payment transactions are recognised at their fair value on the date they are granted.
Fair value as of the date the benefits are granted is recognised as cost on a straight-line basis over the vesting period as a result of services rendered.
Contingent liabilities are not recognised in the consolidated financial statements but are disclosed in the notes to the financial statements, unless the possibility of an outflow of funds affecting future economic benefits is remote, in which case they are not subject to disclosure.
Contingent assets are not recognised in the consolidated financial statements, but are disclosed in the notes to the financial statements when a future economic benefit is probable.
Income resulting from sales is recognised in the consolidated statement of profit and loss when the risks and benefits of ownership of assets are transferred to the purchaser and the amount of income can be reasonably quantified. Sales are recognised at the fair amount received or receivable, net of taxes, discounts and other costs incurred to realise them, by the fair value of the amount received or receivable.
Income from services rendered is recognised in the consolidated statement of profit and loss in the period in which they are rendered.
Interest and financial income are recognised on an accruals basis in accordance with the effective interest rate.
Costs and income are recognised in the period to which they relate independently of when they are paid or received. Costs and income, the amount of which is not known, are estimated.
Costs and income attributable to the current period which will only be paid or received in future periods, as well as amounts paid and received in the current period that relate to future periods and will be attributed to each of the periods by the amount corresponding to them, are recorded in the captions Other current assets and Other current liabilities (Notes 23 and 41).
At each balance sheet date, the Group reviews for any indication that a financial asset or a group of financial assets may be impaired.
For the financial assets classified as available-for-sale, a continuous or a significant decline in the fair value of the instrument below its cost, is considered as an indicator of impairment. If such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference between the asset's carrying amount and the present fair value, less any impairment loss already recognised in profit and loss – is removed from equity and recognised in profit and loss
statement. Impairments relating to investments in available-for-sale equity instruments are not reversed through statement of profit and loss.
Impairment losses are recorded whenever there are clear indicators that the Group will not be able to collect all the amounts it should receive, according to the terms established by the contracted agreements. To identify these losses, several indicators are used, such as:
The adjustments are measured by the difference between the recoverable amount and the carrying amount of the financial asset and recognized as an expense in the income statement. The carrying amount of these assets is reduced to the recoverable amount through an impairment recognition. Whenever a certain amount is considered as uncollectible it is removed through the use of the respective impairment account. Subsequent recovery of these amounts is recorded in the income statement.
Tax on income for the period is calculated based on the taxable results of the companies included in the consolidation and takes into consideration deferred taxation.
Current income tax is calculated based on the taxable results (which differ from the accounting results) of the companies included in the consolidation, in accordance with the tax rules applicable to the area in which the head office of each Group company is located.
Deferred taxes refer to temporary differences between the amounts of assets and liabilities for accounting purposes and the corresponding amounts for tax purposes.
Deferred tax assets and liabilities are calculated and assessed periodically using the tax rates expected to be in force when the temporary differences reverse, and are not subject to discounting.
Deferred tax assets are only recognised when there is reasonable expectation that there will be sufficient future taxable income to utilise them. Temporary differences underlying the deferred tax assets are reappraised annually in order to recognise or adjust the deferred tax assets based on the current expectation of their future recovery.
Earnings per share are calculated dividing the result attributable to the ordinary shareholders of the parent company, by the weighted average number of shares in circulation during the period.
The diluted earnings per share are calculated dividing the result attributable to the ordinary shareholders of the parent company, by the weighted average number of shares in circulation during the period, adjusted by potential ordinary diluting shares.
Potential ordinary diluting shares can result from options over shares and other financial instruments issued by the Group, convertible to shares of the Parent company.
Events that occur after the date of the balance sheet that provide additional information on conditions that existed as of the balance sheet date are reflected in the consolidated financial statements.
Events that occur after the date of the balance sheet, that provide information on conditions that exist after the balance sheet date, if material, are disclosed in the notes to the consolidated financial statements.
Some of the Group's production units in Portugal and Spain are covered by the European greenhouse effect gas emissions market. While the IASB does not issue accounting policies covering the granting and trading of emission licences, the Group adopts the following policy:
The significant changes in estimates in the years ended 31 December 2008 and 2007 relate to changes in the actuarial assumptions used to determine the liability due to employee benefits, disclosed in Note 33.
In the year ended 31 December 2008, arising from changes to IAS 23, the Group has charged the cost of its qualifying assets (Note 2.11.) on loan costs directly related to its acquisition, construction or production to date that is available to the intended use or sale.
There were no other changes in accounting policies or corrections of errors identified in these years.
The parent company, Cimpor - Cimentos de Portugal, SGPS, S.A., and the following subsidiaries, in which it has majority participation (control), have been consolidated using the full consolidation method:
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| HOLDING AND SUB-HOLDING COMPANIES | ||
| CIMPOR SGPS | CIMPOR - CIMENTOS DE PORTUGAL, SGPS, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
|
| CIMPOR PORTUGAL | CIMPOR PORTUGAL, SGPS, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| CIMPOR INTERNACIONAL | CIMPOR INTERNACIONAL, SGPS, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| CIMPOR INVERSIONES | CIMPOR INVERSIONES, S.A. Calle Brasil, 56 36204 Vigo |
100.00 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| CEMENT AREA (Portugal) | ||
| CIMPOR INDÚSTRIA | CIMPOR – INDÚSTRIA DE CIMENTOS, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| SCIAL | ESTABELECIMENTOS SCIAL DO NORTE, S.A. Av. Américo Duarte – S. Pedro Fins – Maia 4425 - 504 Maia |
100.00 |
| CECISA | CECISA - COMÉRCIO INTERNACIONAL, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| CTA | CEMENT TRADING ACTIVITIES - COMÉRCIO INTERNACIONAL, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| MOSSINES | MOSSINES – CIMENTOS DE SINES, S.A. Rua Alexandre Herculano, 35 1250 - 009 LISBOA |
100.00 |
| CIMENTAÇOR | CIMENTAÇOR - CIMENTOS DOS AÇORES, LDA. Rua Bento Dias Carreiro, 6 9600-050 Pico da Pedra - Ribeira Grande Açores |
100.00 |
| CECIME | CECIME – CIMENTOS, S.A. R. Cintura do Porto de Lisboa, Armazém, 21 Topo Norte 1900 - 649 Lisboa |
100.00 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| READY MIX CONCRETE AND AGGREGATES AREA (Portugal) | ||
| CIMPOR BETÃO | CIMPOR BETÃO - INDÚSTRIA DE BETÃO PRONTO, S.A. Rua Quinta do Paizinho, Edifício Bepor, Bloco 2-1ºEsq. 2790 - 237 Carnaxide |
100.00 |
| AGREPOR | AGREPOR AGREGADOS - EXTRACÇÃO DE INERTES, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| BETÃO LIZ | BETÃO LIZ, S.A. Rua Quinta do Paizinho, Edifício Bepor, Bloco 2-1ºEsq. 2790 - 237 Carnaxide |
100.00 |
| VERMOFEIRA | VERMOFEIRA - EXTRACÇÃO E COMÉRCIO DE AREIAS, LDA. Rua Quinta do Paizinho, Edifício Bepor, Bloco 2-1ºEsq. 2790 - 237 Carnaxide |
100.00 |
| FORNECEDORA | FORNECEDORA DE BRITAS DO CARREGADO, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| M.C.D. | M.C.D. - MATERIAIS DE CONSTRUÇÃO, DRAGADOS E BETÃO PRONTO, S.A. Rua Quinta do Paizinho, Edifício Bepor, Bloco 2-1ºEsq. 2790 - 237 Carnaxide |
100.00 |
| SOGRAL | SOGRAL - SOCIEDADE DE GRANITOS, S.A. Lugar de Fojo Freguesia e Concelho de Mangualde 3530-110 Mangualde |
95.00 |
| JOMATEL | JOMATEL - EMPRESA DE MATERIAIS DE CONSTRUÇÃO, S.A. Rua Quinta do Paizinho, Edifício Bepor, Bloco 2-1ºEsq. |
90.00 |
2790 - 237 Carnaxide
7002 - 505 Évora
IBERA IBERA - INDÚSTRIA DE BETÃO, S.A. 50.00 Qtª da Madeira, Estrada Nac. 114, km 85
| Name | Full name/headquarters | Effective Participation |
|---|---|---|
| PRECAST AREA (Portugal) | ||
| PREDIANA | PREDIANA - SOCIEDADE DE PRÉ-ESFORÇADOS, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| GEOFER | GEOFER - PRODUÇÃO E COMERCIALIZAÇÃO DE BENS E EQUIPAMENTOS, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| OTHER RELATED ACTIVITIES (Portugal) | ||
| SACOPOR | SACOPOR - SOCIEDADE DE EMBALAGENS E SACOS DE PAPEL, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| CIMPOR TEC | CIMPOR TEC – ENGENHARIA E SERVIÇOS TÉNICOS DE APOIO AO GRUPO, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| CIARGA | CIARGA - ARGAMASSAS SECAS, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| TRANSVIÁRIA | TRANSVIÁRIA - GESTÃO DE TRANSPORTES, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| ALEMPEDRAS | ALEMPEDRAS - SOCIEDADE DE BRITAS, LDA. Casal da Luz, Santa Maria 2510 - 086 Óbidos |
100.00 |
| CELFA | CELFA – SOCIEDADE INDUSTRIAL DE TRANSFORMAÇÃO DE GESSOS, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| SCORECO | SCORECO - VALORIZAÇÃO DE, RESÍDUOS, LDA. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| KANDMAD | KANDMAD – SOCIEDADE GESTORA DE PARTICIPAÇÕES SOCIAIS, LDA. Av. Arriaga, 77, Edifício Marina Fórum, 1º, sala 103, Sé 9000 - 060 Funchal Madeira |
100.00 |
| CORPORACIÓN NOROESTE | CORPORACIÓN NOROESTE, S.A. Brasil, 56 36 204 Vigo |
99.54 |
|---|---|---|
| C.N. HORMIGONES Y ÁRIDOS | CORPORACIÓN NOROESTE DE HORMIGONES Y ÁRIDOS, S.L. Brasil, 56 36 204 Vigo |
99.54 |
| S.C.M.C. ANDALUCÍA | SOCIEDAD DE CEMENTOS Y MATERIALES DE CONSTRUCCIÓN DE ANDALUCÍA, S.A. Av. de la Agrupacíon de Córdoba, 15 14 014 Córdoba |
99.54 |
| CEMENTOS ANDALUCÍA | CEMENTOS DE ANDALUCÍA, S.L. Av. de la Agrupación de Córdoba, 15 14 014 Córdoba |
99.54 |
| OCCIDENTAL HORMIGONES | OCCIDENTAL DE HORMIGONES, S.L. Calle la Biela s/n Polígono Industrial el Nevero 06006 Badajoz |
99.54 |
| CEMENTOS EL MONTE | CEMENTOS EL MONTE, S.A. 21810 – Palos de la Frontera (Huelva) Puerto Exterior de Huelva Muelle Ingeniero Juan Gonzalo s/n |
99.54 |
| CEMENTOS NOROESTE | CEMENTOS NOROESTE, S.L. Brasil, 56 36 204 Vigo |
99.54 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| SERMACONSA | SERVICIOS Y MATERIALES PARA LA CONSTRUCCIÓN, S.A. Brasil, 56 36 204 Vigo |
99.54 |
| MORTEROS GALICIA | MORTEROS DE GALICIA, S.L. Brasil, 56 36 204 Vigo |
99.54 |
| HORMIGONES HÉRCULES | HORMIGONES HÉRCULES, S.L. Polígono Industrial – El Prado – 40 – Mérida 06800 Mérida – Badajoz |
99.54 |
| S.I.F. GALLEGA | SOCIEDAD INDUSTRIAL Y FINANCIERA GALLEGA, S.L. Brasil, 56 36 204 Vigo |
99.54 |
| TABANQUE, S.L. | TABANQUE, S.L. Brasil, 56 36 204 Vigo |
99.54 |
| HORMIGONES MIÑO | HORMIGONES MIÑO, S.L. Brasil, 56 36 204 Vigo |
99.52 |
| CEMENTOS COSMOS | CEMENTOS COSMOS, S.A. Brasil, 56 36 204 Vigo |
99.30 |
| PREBETONG GALICIA | PREBETONG GALICIA, S.A. Brasil, 56 36 204 Vigo |
98.41 |
| CANTERAS PREBETONG | CANTERAS PREBETONG, S.L. Brasil, 56 36 204 Vigo |
98.41 |
| BOMTRAHOR | BOMBEO Y TRANSPORTE DE HORMIGON, S.A. Brasil, 56 36 204 Vigo |
92.80 |
| PREBETONG LUGO | PREBETONG LUGO, S.A. Av. Benigno Rivera s/n Polígono Industrial del Ceao 27 003 Lugo |
81.57 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| PREBETONG LUGO HORMIGONES | PREBETONG LUGO HORMIGONES, S.A. Av. Benigno Rivera s/n Polígono Industrial del Ceao 27 003 Lugo |
81.57 |
| F.Y.H. SANI | FIRMES Y HORMIGONES SANI, S.L. CARRETERA NACIONAL – 630 Gijón – Sevilla, Km 308 06200 ALMENDRALEJO (BADAJOZ) |
83.52 |
| MATERIALES ATLÁNTICO | MATERIALES DEL ATLÁNTICO, S.A. Polígono Industrial As Lagoas – Carretera Cedeira Km. 1,5 15 570 Narón (La Coruña) |
99.46 |
| HORMIGONES LA BARCA | HORMIGONES Y ÁRIDOS LA BARCA, S.A. Lugar de Lantañón Vilanoviña - Meis (Pontevedra) |
49.77 |
| ARICOSA | ÁRIDOS DE LA CORUÑA, S.A. Candame 15 142 Arteixo (La Coruña) |
49.21 |
| CANPESA | CANTEIRA DO PENEDO, S.A. Reina, 1 – 3º 27 001 Lugo |
40.77 |
| OCCIDENTAL DE ARIDOS | OCCIDENTAL DE ARIDOS, S.L. Calle Brasil nº 56 36204 Vigo |
87.78 |
| ÁRIDOS COSMOS | ARIDOS COSMOS, S.L. Calle Brasil nº 56 36204 Vigo |
83.52 |
| CIMPOR HORMIGÓN CANARIAS | CIMPOR HORMIGÓN CANARIAS, S.L. Calle Brasil nº 56 36204 Vigo |
99.54 |
| CIMPOR CANARIAS | CIMPOR CANARIAS, S.L. Calle Brasil nº 56 36204 Vigo |
99.54 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| MOROCCO | ||
| ASMENT DE TEMARA | ASMENT DE TEMARA, S.A. Ain Attig – Route de Casablanca Témara |
62.62 |
| BETOCIM | BETOCIM, S.A. Ain Attig – Route de Casablanca Témara |
100.00 |
| ASMENT DU CENTRE | ASMENT DU CENTRE, S.A. Ain Attig – Route de Casablanca Témara |
100.00 |
| GRABEMA | GRABEMA, S.A. Ain Attig – Route de Casablanca Témara |
100.00 |
| TUNISIA | ||
| C.J.O. | SOCIÉTÉ DES CIMENTS DE JBEL OUST 9, Rue de Touraine, Cité Jardins 1082 Tunis – Belvédère Tunisie |
100.00 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| EGYPT | ||
| CEC | CIMPOR EGYPT FOR CEMENT COMPANY, S.A.E. El Gharbaneyat – Borg El Arab City P.O. Box 21511 Alexandria |
100.00 |
| AMCC | AMREYAH CEMENT COMPANY, S.A.E. El Gharbaneyat – Borg El Arab City P. O. Box 21511 Alexandria |
96.39 |
| AMREYAH CIMPOR | AMREYAH CIMPOR CEMENT COMPANY, S.A.E. El Gharbaneyat – Borg El Arab City P.O. Box 21511 Alexandria |
97.29 |
| CSC | CEMENT SERVICES COMPANY, S.A.E. El Gharbaneyat – Borg El Arab City P.O. Box 21511 Alexandria |
98.39 |
| CIMPSAC | CIMPOR SACS MANUFACTURE COMPANY, S.A.E. El Gharbaneyat – Borg El Arab City P.O. Box 21511 Alexandria |
99.59 |
| AMREYAH DEKHEILA | AMREYAH DEKHEILA TERMINAL COMPANY, S.A.E. Trade City Center – Down Town Desert Road International Garden Alexandria |
97.35 |
| AMREYAH CIMPOR READY MIX | AMREYAH CIMPOR READY MIX COMPANY S.A.E. Trade City Center – Down Town Desert Road International Garden Land Alexandria |
96.86 |
| CIMPOR YIBITAS | CIMPOR YIBITAS CIMENTO SANAYI VE TICARET A.S. Portakal Cicegi Sokak nº 33 - 06540 06540 Cankaya/Ankara/TURKIYE |
99.74 |
|---|---|---|
| YOZGAT | YIBITAS YOZGAT ISCI BIRLIGI INSAAT MALZEMELERI TICARET VE SANAYI A. S. 66920 - Sarayköy / Yozgat/TURKIYE |
79.50 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| BEYNAK | CIMPOR YIBITAS NAKLIYECILIK TICARET VE SANAYI A.S. Portakal Cicegi Sokak nº 33 - 06540 06540 Cankaya/Ankara/TURKIYE |
99.74 |
| NAKLIYECILIK | CIMPOR YIBITAS NAKLIYECILIK LTD. STI. Portakal Cicegi Sokak nº 33 - 06540 06540 Cankaya/Ankara/TURKIYE |
99.74 |
| BRAZIL | ||
| C.C.B. | CIMPOR - CIMENTOS DO BRASIL, LTDA. Avª Maria Coelho Aguiar, 215 – Bloco E – 8º Jardim São Luíz - São Paulo |
100.00 |
| MOZAMBIQUE | ||
| CIM. MOÇAMBIQUE | CIMENTOS DE MOÇAMBIQUE, S.A. Av. Fernão de Magalhães, 34 – 2º, nº1 Maputo – Caixa Postal 270 |
82.46 |
| CIMBETÃO | CIMPOR BETÃO MOÇAMBIQUE, S.A. Estrada de Lingamo Matola |
82.46 |
| IMOPAR | IMOPAR - IMOBILIÁRIA DE MOÇAMBIQUE, S.A. Av. 24 de Julho, nº 7 - 10º piso, direito Maputo - Moçambique |
100.00 |
| SOUTH AFRICA | ||
| NPC | NPC - CIMPOR (PTY) LIMITED 199 Coedmore Road Bellair 4094 Durban South Africa |
74.00 |
| NPCC | NATAL PORTLAND CEMENT COMPANY (PTY) LTD. 199 Coedmore Road Bellair 4094 Durban South Africa |
100.00 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| DC | DURBAN CEMENT LTD. 199 Coedmore Road Bellair 4094 Durban South Africa |
100.00 |
| SRT | SIMUMA REHABILITATION TRUST 1 Wedgelink Road Bryanston South Africa |
37.00 |
| NPC - CELL "A7" | NATAL PORTLAND CEMENT CO (PTY) LTD. – CELL A7 5 th Floor SA Eagle House 70 Fox Street Johannesburg South Africa |
74.00 |
| CONCRETE | NPC CONCRETE (PTY) LTD. 199 Coedmore Road Bellair 4094 Durban South Africa |
100.00 |
| S. C. STONE | SOUTH COAST STONE CRUSHERS (PTY) LTD. 199 Coedmore Road Bellair 4094 Durban South Africa |
74.00 |
| S. C. MINING | SOUTH COAST MINING (PTY) LTD. 199 Coedmore Road Bellair 4094 Durban South Africa |
100.00 |
| EEDESWOLD | EEDESWOLD HIGHLANDS (PTY) LTD. 199 Coedmore Road Bellair 4094 Durban South Africa |
100.00 |
| STERKSPRUIT AGGREGATES | STERKSPRUIT AGGREGATES (PTY) LTD. 199 Coedmore Road Bellair 4094 Durban South Africa |
74.00 |
| STERKSPRUIT CONCRETE | STERKSPRUIT CONCRETE (PTY) LTD. 199 Coedmore Road Bellair 4094 Durban South Africa |
100.00 |
| DURBAN QUARRIES | DURBAN QUARRIES (PTY) LTD. 199 Coedmore Road Bellair 4094 Durban South Africa |
100.00 |
| Name | Full name/headquarters | Effective participation |
|
|---|---|---|---|
| CHINA | |||
| CIMPOR CHENGTONG | CIMPOR CHENGTONG CEMENT CORPORATION LIMITED. Suite 6404, 64th floor Central Plaza, 18 Harbour Road Wanchai - Hong Kong (R. P. China) |
49.60 | |
| SEA - LAND MINING | SEA - LAND MINING LIMITED Suite 6404, 64th floor Central Plaza, 18 Harbour Road Wanchai - Hong Kong (R. P. China) |
49.60 | |
| NEW LIUYUAN | SHANGDONG LIUYUAN NEW TYPE CEMENT DEVELOPMENT COMPANY LIMITED Kuangsi Village, Liuyuan Town, Yicheng District Zaozhuang City, Shangdong Province ZIP code: 277300 (R.P. China) |
48.41 | |
| NANDA | SUZHOU NANDA CEMENT COMPANY LIMITED Nº. 1, WenDu Road, Wang Ting Town, Xiang Cheng District Suzhou City, Jiangu Province ZIP code: 215155 (R.P. China) |
35.23 | |
| HUAI AN LIUYUAN | HUAI AN LIUYUAN CEMENT COMPANY LIMITED Huai' an city, Huaiyin district, WangYing town (former Huayin district Building materials plant site) ZIP code: 223300 (R.P China) |
48.41 | |
| SUZHOU LIUYUAN | SUZHOU LIUYUAN NEW TYPE CEMENT DEVELOPMENT CO.,LTD Suzhou Wuzhong economic development zone, DongWu industrial park second term (Yinzhong south road) ZIP code: 215000 (R.P. China) |
48.41 | |
| CIMPOR SHANGHAI | CIMPOR CHENGTONG (SHANGHAI) ENTERPRISES MANAGEMENT CONSULTING COMPANY LIMITED 222 Huaihai Zhong Lu, Lippo Plaza, Floor 25, Room 2505-07 ZIP Code: 200021 Shanghai (R.P. China) |
49.60 | |
| LIYANG | LIYANG DONGFANG CEMENT COMPANY LIMITED Shanghuang Town, Liyang, Jiangsu Province ZIP Code: 213314 (R.P. China) |
49.60 | |
| NEW HLG | CIMPOR CHENGTONG (HUAIN AN) CEMENT PRODUCTS COMPANY LIMITED Wangying Town, Huaiyin district Huai'An City (R.P. China) |
49.60 |
| Name | Effective Full name/headquarters participation |
|||||
|---|---|---|---|---|---|---|
| CIMPOR MACAU INVESTMENT | CIMPOR MACAU INVESTMENT COMPANY, S.A. Av. da Praia Grande, 693 Edifício Tai Wash - 15º andar MACAU (R. P. China) |
|||||
| EAST ADVANTAGE | EAST ADVANTAGE INTERNACIONAL LIMITED OMC Chambers, P.O. Box 3152, Road Town, Tortola British Virgin Islands |
49.60 | ||||
| INDIA | ||||||
| SHREE DIJIVAY CEMENT CO, LTD | SHREE DIJIVAY CEMENT CO, LTD P.O. Digvijaygram - 361140 Jamnagar Estado de Gujarat India |
73.63 | ||||
| CAPE VERDE | ||||||
| NORDICAVE TRADING | NORDICAVE TRADING INDUSTRIAL, LIMITADA. Estrada de Tira Chapéu, Praia, Santiago 14/A Cabo Verde |
100.00 | ||||
| CIMPOR CABO VERDE | CIMPOR CABO VERDE, S.A. Estrada de Tira Chapéu Praia, Santiago 14/A Cabo Verde |
98.65 | ||||
| CABO VERDE BETÕES E INERTES | CABO VERDE BETÕES E INERTES, S.A. Estrada de Tira Chapéu Praia, Santiago 14/A Cabo Verde |
75.96 | ||||
| ITP | INDÚSTRIA DE TRANSFORMAÇÃO DE PEDRAS, LDA. Estrada de Tira Chapéu Praia, Santiago 14/A Cabo Verde |
98.65 | ||||
| BETÕES DE CABO VERDE | BETÕES DE CABO VERDE, S.A. Estrada de Tira Chapéu Praia, Santiago 14/A Cabo Verde |
54.32 |
| Name | Full name/headquarters | Effective participation |
|
|---|---|---|---|
| PERU | |||
| CEMENTOS OTORONGO | CEMENTOS OTORONGO, S.A.C. Calle Siglo XXI nº 120 Centro Comercial La Gran Vía, Of. 549 - 551 Cercado Arequipa - Peru Ciudade de Arequipa, Provincia y Departamento de Arequipa - Perú |
80.00 | |
| AGRECOM | AGREGADOS COMERCIAIZADOS S.A.C. Av. Néstor Gambetta s/n Base Naval Del Callao, Puerta 6 Callao Peru |
80.00 |
| CIMPOR SERVIÇOS | CIMPOR – SERVIÇOS DE APOIO À GESTÃO DE EMPRESAS, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
|---|---|---|
| CIMPOR SAGESA | CIMPOR SAGESA, S.A. Brasil, 56 36 204 Vigo |
100.00 |
| CIMPOR FINANCE | CIMPOR FINANCE LIMITED 2 Harbourmaster Place Custom House Dock Dublin 1 |
100.00 |
| CIMPOR B.V. | CIMPOR FINANCIAL OPERATIONS, B.V. Teleportboulevard 140 1043 EJ Amesterdam |
100.00 |
| SCANANG SGPS | SCANANG SGPS, UNIPESSOAL, LDA. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| CIMPOR IMOBILIÁRIA | CIMPOR IMOBILIÁRIA, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| MECAN | MECAN - MANUFACTURA DE ELEMENTOS DE CASAS DE CONSTRUÇÃO NORMALIZADA, LDA. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
100.00 |
| SCANANG TRADING | SCANANG TRADING ACTIVITIES-ESPAÑA, S.A. Brasil, 56 36 204 Vigo |
100.00 |
| CIMPOR REINSURANCE | CIMPOR REINSURANCE, S.A. 74, Rue de Merl, L - 2146 1611 – Luxemburgo |
100.00 |
| CIMPSHIP | CIMPSHIP - TRANSPORTES MARÍTIMOS, S.A. Rua Ivens, nº 3 - B, Edifício Dona Mécia, 2º L, Freguesia da Sé, Conselho do Funchal 9000 - 039 Funchal |
60.00 |
| CIMPOR DEL ECUADOR | CIMPOR DEL ECUADOR, S.A. Distrito Metropolitano de Quito Província de Pichincha |
49.00 |
Investments in associated companies, recorded in accordance with the equity method (Note 19) for the year ended 31 December 2008 were as follows:
| Name | Full name/headquarters | Effective participation |
|
|---|---|---|---|
| CEMENT AREA (Portugal) | |||
| C + P.A. | C + P.A. – CIMENTO E PRODUTOS ASSOCIADOS, S.A. Edifício 1 do Lagoas Park 2740 - 265 Porto Salvo |
48.00 |
| Name | Full name/headquarters | Effective participation |
||
|---|---|---|---|---|
| OTHER RELATED ACTIVITIES (Portugal) | ||||
| SOGESSO | SOGESSO - SOCIEDADE DE GESSOS DE SOURE, S.A. Lugar de São José do Pinheiro 3130 - 544 Soure |
40.00 | ||
| SETEFRETE | SETEFRETE, SGPS, S.A. Av. Luísa Todi, 1 – 1º 2900 – 459 Setúbal |
25.00 |
| CEMENTOS ANTEQUERA | CEMENTOS ANTEQUERA, S.A. Calle Atarazanas nº 2 - 1º 29005 Málaga |
21.29 |
|---|---|---|
| ARENOR | ARENOR, S.L. Calle Monte Carmelo nº 1 – 5º C 41011 Sevilla |
51.74 |
| CEMENTOS DEL MARQUESADO | CEMENTOS DEL MARQUESADO, S.A. Calle Atarazanas, nº 2 - 1º 29 005 Málaga |
27.64 |
| COMICAN | COMPANHIA DE MINERAÇÃO CANDIOTA | 48.00 |
|---|---|---|
| Av. Maria Coelho Aguiar, 215 - Bloco E - 8º. Andar - Sala A Jardim São Luiz - São Paulo |
||
The following companies were consolidated in accordance with the proportional method as they are jointly controlled with the other shareholder:
| Name | Full name/headquarters | Effective participation |
|---|---|---|
| CEMENT AREA (Portugal) | ||
| TEPORSET | TEPORSET - TERMINAL PORTUÁRIO DE SETÚBAL, S.A. Rua Alexandre Herculano, 35 1250 - 009 Lisboa |
50.00 |
| INTERNATIONAL AREA - SPAIN | ||
| CEISA | CEMENTOS ESPECIALES DE LAS ISLAS, S.A. Calle Secretario Artiles nº 36 35007 Las Palmas de Gran Canaria |
50.00 |
| INPROCOI | INSULAR DE PRODUCTOS PARA LA CONSTRUCCIÓN Y LA INDUSTRIA, S.L. Explanada Muelle Dique del Este s/n 38180 Puerto de Santa Cruz de Tenerife |
50.00 |
| INTERNATIONAL AREA - TUNISIA | ||
| TCG | TERMINAL CIMENTIER DE GABES, G.I.E Port de Gabes Gabes - Tunisie |
33.33 |
| INTERNACIONAL AREA – BRAZIL | ||
| ECO-PROCESSA | ECO-PROCESSA – TRATAMENTO DE RESÍDUOS LTDA. Av. Rio Branco, 110 – 39º - parte Cidade do Rio de Janeiro |
49.99 |
Estado do Rio de Janeiro
The more significant changes in the year ended 31 December 2008, in the companies included in the consolidation were as follows:
Portugal - acquisition of 50% of the capital of Teporset - Terminal Portuário de Setúbal, S.A. from the C+PA - Cimentos e Produtos Associados, S.A. company, and acquisition of 95% of the share capital of Sogral – Sociedade de Granitos, S.A..
India - Conclusion by Cimpor Inversiones, S.A. of the process of acquisition of a set of shareholdings representing close on 73.63% of the share capital of the Indian company Shree Digvijay Cement Company Limited, listed on the Mumbai Stock Exchange.
Spain - The acquisition during the first half of 2008, through subsidiaries of the Spain Business Area, of i) a 75% stake in the capital of Arenor Áridos, S.L.U., with the remaining 25% subject to a preliminary purchase contract, with a three year execution period, by 8.15 million euros; ii) three concrete plants and of all the shares representing the share capital of Arenor Hormigones, S.L.U.; iii) all the shares representing the share capital of Urgón y Trituración, S.L.; iv) all the shares representing the share capital of Urgón, S.A. (the first two were acquired from the associate Arenor S.L.).
In the second half of 2008, the acquisition of i) all the operations developed by the Cemex Group in the Canary Islands: assets on the island of Tenerife manufacturing and marketing cement and ready-mix concrete and two shareholdings of 50%, one in the share capital of the Cementos Especiales de las Islas, S.A. (CEISA) company and the other in the share capital of the Insular de Productos para la Construcción y la Industria, S.L. (INPROCOI) company; ii) acquisition of 24% of the share capital of Cementos del Marquesado, S.A..
Brazil - acquisition of 48% of the share capital of the Companhia de Mineração Candiota company and the purchase of the assets of a ready-mix concrete plant.
Turkey - acquisition of the assets of two ready-mix concrete plants.
China - acquisition of 100% of the share capital of the Liyang Dongfang Cement Co (LIYANG) company by the subsidiary Cimpor Chengtong Cement Corporation, Ltd..
In the Portugal Business Area, the entire shareholding in Betaçor – Fabrico de Betão e Artefactos de Cimento, S.A. was disposed of.
The impact of these changes in the consolidated balance sheet for the year ended 31 December 2008 was as follows:
| Acquisitions | Sales | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Captions | Portugal | India | Spain | Brazil | Turkey | China | Subtotal of acquisitions |
Portugal | Total |
| Non current assets: | |||||||||
| Intangible assets (Note 17) | 176 | - | 22,166 | - | - | 644 | 22,987 | - | 22,987 |
| Tangible assets (Note 12) | 4,964 | 15,836 | 98,614 | 757 | 1,621 | 14,685 | 136,477 | (352) | 136,125 |
| Investments in associates (Note 19) | - | - | 11,076 | 15 | - | - | 11,091 | - | 11,091 |
| Other investments (Note 20) | 9 | 109 | 536 | - | - | - | 654 | - | 654 |
| Accounts receivable - other | - | 2 | - | - | - | - | 2 | - | 2 |
| Other non-current assets | - | - | 17,540 | - | - | 361 | 17,901 | - | 17,901 |
| Deferred tax assets (Note 24) | 27 | 8,913 | - | - | - | - | 8,940 | (40) | 8,899 |
| Total non-current assets | 5,177 | 24,860 | 149,933 | 772 | 1,621 | 15,690 | 198,053 | (392) | 197,660 |
| Current assets: | |||||||||
| Inventories | 227 | 6,281 | 16,232 | - | - | 1,762 | 24,502 | (30) | 24,472 |
| Accounts receivable - trade | 1,370 | 2,466 | 19,687 | - | - | 989 | 24,512 | (1,445) | 23,067 |
| Accounts receivable - other | 370 | 264 | 1,038 | - | - | 110 | 1,781 | (1) | 1,780 |
| Taxes recoverable | 132 | 648 | 2,961 | - | - | - | 3,741 | (30) | 3,711 |
| Other current assets | 3 | 56 | 916 | - | - | 213 | 1,188 | - | 1,188 |
| Total current assets | 2,101 | 9,715 | 40,835 | - | - | 3,074 | 55,725 | (1,506) | 54,219 |
| Total assets | 7,278 | 34,575 | 190,768 | 772 | 1,621 | 18,764 | 253,778 | (1,898) | 251,879 |
| Non current liabilities: | |||||||||
| Deferred tax liabilities (Note 24) | - | (2,673) | (9,506) | - | - | - | (12,179) | 1 | (12,178) |
| Provisions (Note 35) | (300) | (4,170) | (328) | - | - | - | (4,799) | - | (4,799) |
| Loans | - | (16,132) | (30) | - | - | - | (16,162) | - | (16,162) |
| Obligations under finance leases | - | - | (716) | - | - | - | (716) | - | (716) |
| Accounts payable - other | - | - | (1,238) | - | - | - | (1,238) | 100 | (1,138) |
| Total non-current liabilities | (300) | (22,975) | (11,818) | - | - | - | (35,094) | 101 | (34,993) |
| Current liabilities: | |||||||||
| Accounts payable - trade | (1,477) | (3,805) | (6,557) | - | - | (3,001) | (14,840) | 965 | (13,875) |
| Accounts payable - other | (1,986) | (2,094) | (4,914) | - | - | (2,397) | (11,391) | 959 | (10,432) |
| Taxes payable | (17) | (675) | (67) | - | - | (247) | (1,005) | 190 | (815) |
| Loans | (4,148) | - | (3,059) | - | - | (3,138) | (10,346) | - | (10,346) |
| Obligations under finance leases | - | - | (323) | - | - | - | (323) | - | (323) |
| Other current liabilities | (51) | (547) | (40) | - | - | (1,077) | (1,714) | 32 | (1,683) |
| Total current liabilities | (7,679) | (7,120) | (14,959) | - | - | (9,860) | (39,619) | 2,146 | (37,473) |
| Total liabilities | (7,979) | (30,095) | (26,777) | - | - | (9,860) | (74,712) | 2,246 | (72,466) |
| Minority interest (Note 32) | 25 | (1,845) | (6,653) | - | - | - | (8,473) | - | (8,473) |
| (676) | 2,634 | 157,338 | 772 | 1,621 | 8,904 | 170,593 | 348 | 170,941 | |
| Net amount | |||||||||
| Goodwill (Note 16) | 3,103 | 68,374 | 68,736 | 991 | 2,335 | 13,284 | 156,823 | - | 156,823 |
| Investments in associates | - | - | - | - | - | - | - | (307) | (307) |
| Badwill (Note 12) | - | - | (21) | - | - | - | (21) | - | (21) |
| Capital (gain) / loss | - | - | - | - | - | - | - | (532) | (532) |
| Accounts receivable / payable - other | - | - | (7,143) | - | - | (3,785) | (10,928) | 63 | (10,865) |
| Other investments (Note 20) | (250) | - | - | - | - | - | (250) | - | (250) |
| Net amount paid / (received) | 2,178 | 71,008 | 218,910 | 1,763 | 3,956 | 18,403 | 316,218 | (429) | 315,789 |
| Cash and cash equivalents | 359 2,787 |
2,518 73,527 |
5,610 231,663 |
- 1,763 |
- 3,956 |
99 22,287 |
8,586 335,982 |
(109) (600) |
8,478 335,382 |
| Net assets acquired / (sold) |
The impact in the consolidated statement of profit and loss for the year ended 31 December 2008, as result of the above referred acquisitions, was as follows:
| Captions | Portugal | India | Spain | Total |
|---|---|---|---|---|
| Operating income | - | 32,398 | 7,559 | 39,957 |
| Operating expenses | 16 | 30,004 | 6,479 | 36,499 |
| Net operating income | (16) | 2,394 | 1,080 | 3,458 |
| Net financial expenses | 74 | (1,643) | - | (1,568) |
| Profit before income tax | 58 | 752 | 1,080 | 1,889 |
| Income tax | (20) | (237) | (324) | (582) |
| Net profit for the year | 38 | 514 | 756 | 1,308 |
| Attributable to: | ||||
| Equity holders of the parent | 38 | 379 | 752 | 1,168 |
| Minority interest | - | 136 | 3 | 139 |
The exchange rates used to translate, to euros, the foreign currency assets and liabilities at 31 December 2008 and 2007, as well the results for the years then ended were as follows:
| Closing exchange rate | Average exchange rate | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Currency | Segment | 2008 | 2007 | Var.% | 2008 | 2007 | Var.% | |||
| USD | Other | 1.3917 | 1.4721 | (5.5) | 1.47134 | 1.37074 | 7.3 | |||
| MAD | Morocco | 11.2665 | 11.4042 | (1.2) | 11.43104 | 11.30842 | 1.1 | |||
| BRL | Brazil | 3.2436 | 2.5963 | 24.9 | 2.68231 | 2.66901 | 0.5 | |||
| TND | Tunisia | 1.8318 | 1.803 | 1.6 | 1.83041 | 1.7726 | 3.3 | |||
| MZM | Mozambique | 35,250.00 | 34,830.00 | 1.2 | 35,654.28 | 35,156.33 | 1.4 | |||
| CVE | Other (Cape Verde) | 110.265 | 110.265 | 0.0 | 110.265 | 110.265 | 0.0 | |||
| EGP | Egypt | 7.6857 | 8.1072 | (5.2) | 8.07765 | 7.83675 | 3.1 | |||
| ZAR | South Africa | 13.0667 | 10.0298 | 30.3 | 12.0776 | 9.67099 | 24.9 | |||
| TRY | Turkey | 2.1488 | 1.717 | 25.1 | 1.90964 | 1.78257 | 7.1 | |||
| HKD | China | 10.7858 | 11.48 | (6.0) | 11.46236 | 10.69488 | 7.2 | |||
| CNY | China | 9.4956 | 10.7524 | (11.7) | 10.24795 | 10.59077 | (3.2) | |||
| MOP | China | 11.1094 | 11.8244 | (6.0) | 12.01416 | 11.2599 | 6.7 | |||
| PEN | Other (Peru) | 4.3713 | 4.4862 | (2.6) | 4.34771 | 4.40802 | (1.4) | |||
| INR | India | 67.3931 | - | - | 65.61679 1) | - | - |
1) Average exchange rate between 1 April to 31 December 2008.
The main profit and loss information, by geographical segment, for years ended 31 December 2008 and 2007, is as follows:
| Portugal | Spain | Morocco Tunisia | Egypt | Turkey | Brazil | Mozambique | South Africa |
China | India | Others | Unallocated | Eliminations | Consolidated | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sales and services rendered: External sales Inter segment sales |
85,173 | 461,420 357,751 1,037 |
- | - | 88,849 64,021 161,226 156,128 401,271 - |
- | - | - | 77,361 136,018 64,266 32,263 42,712 2,211 |
1,351 | - | - | 45,577 96,385 |
- (186,157) |
2,088,862 - |
| Total | 546,594 358,788 | 88,849 64,021 161,226 156,128 401,271 | 77,361 138,228 65,617 32,263 42,712 | 141,963 | (186,157) | 2,088,862 | |||||||||
| Operating results | 117,270 | 47,594 | 30,543 | 9,344 | 58,873 | (810) | 70,093 | 8,796 | 38,910 | 2,194 | 2,394 | 2,042 | 5,400 | - | 392,642 |
| Financial expenses Financial income Share of results of associates Other investment income |
(187,816) 138,627 (86,735) 1,537 |
||||||||||||||
| Profit before income tax Income tax |
258,255 (24,949) |
||||||||||||||
| Net profit for the year | 233,306 | ||||||||||||||
| Portugal | Spain | Morocco | Tunisia | Egypt | Turkey | Brazil | Mozambique | South Africa |
China | Others | Unallocated | Eliminations | Consolidated | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Sales and services rendered: | ||||||||||||||
| External sales | 475,947 469,649 | 80,478 59,732 117,272 | 163,053 | 321,760 | 60,078 128,119 23,939 30,522 | 35,509 | - | 1,966,058 | ||||||
| Inter segment sales | 86,626 | 1,280 | - | - | 3,328 | - | 207 | - | 1,658 | - | - | 98,054 | (191,153) | - |
| Total | 562,573 470,929 | 80,478 59,732 120,600 | 163,053 | 321,967 | 60,078 129,778 23,939 30,522 | 133,562 | (191,153) | 1,966,058 | ||||||
| Operating results | 117,660 | 94,045 | 28,409 10,826 | 46,017 | 23,286 | 37,745 | 28,305 | 38,051 | 260 | 2,129 | 11,396 | - | 438,130 | |
| Financial expenses Financial income Share of results of associates Other investment income |
(158,794) 100,490 8,025 2,291 |
|||||||||||||
| Profit before income tax Income tax |
390,142 (69,341) |
|||||||||||||
| Net profit for the year | 320,802 |
All inter segment transactions were made at market values.
The above net income includes the full amount of the segments, without considering the following amounts attributable to minority shareholders:
| Portugal | Spain | Morocco | Tunisia | Egypt | Turkey | Brazil | Mozambique | South Africa |
China | India | Others | Unallocated | Consolidated | |||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Profit for the year attributable to minority interest |
99 | 634 | 7,058 | - 1,677 |
2,207 | 1 | 830 | - | 1,245 | 136 | (487) | 466 | 13,865 | |||
| 2007 | ||||||||||||||||
| Portugal | Spain | Morocco | Tunisia | Egypt | Turkey | Brazil | Mozambique | South Africa |
China | Others | Unallocated | Consolidated | ||||
| Profit for the year attributable to minority interest |
423 | 1,663 | 7,494 | - | 1,201 | 2,462 | - | 3,445 | - | (170) | (117) | 328 | 16,729 | |||
| South | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portugal | Spain | Morocco | Tunisia | Egypt | Turkey | Brazil | Mozambique | Africa | China | India | Others | Unallocated | Consolidated | |
| Fixed capital expenditure | 43,554 | 161,747 | 9,935 | 3,437 | 5,904 | 72,826 | 52,037 | 9,025 | 25,043 | 53,347 | 17,742 | 2,006 | 524 | 457,126 |
| Depreciation and amortisation | 54,357 | 36,365 | 8,015 | 7,701 | 10,850 | 16,233 | 30,817 | 4,662 | 7,254 | 3,726 | 742 | 1,366 | 2,484 | 184,573 |
| Provisions and impairment | ||||||||||||||
| losses | 261 | (1,042) | 2,404 | (18) | 3,497 | 201 | 1,390 | 178 | 1 | 332 | - | - | 1,925 | 9,129 |
| South | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portugal | Spain | Morocco | Tunisia | Egypt | Turkey | Brazil | Mozambique | Africa | China | Others | Unallocated | Consolidated | |
| Fixed capital expenditure | 32,548 | 42,701 | 8,925 | 1,637 | 18,385 | 253,623 | 39,145 | 3,903 | 39,861 | 44,470 | 13,800 | 1,484 | 500,483 |
| Depreciation and amortisation | 51,496 | 33,272 | 6,775 | 7,773 | 11,114 | 13,964 | 29,430 | 1,461 | 4,957 | 1,586 | 824 | 2,401 | 165,052 |
| Provisions and impairment losses | 3,574 | 10,437 | 46 | 345 | 1,474 | 1,306 | 6,691 | (17,417) | - | - | 42 | (2,691) | 3,808 |
In addition, assets and liabilities, by reportable segment, reconciled to the total consolidated amounts as at 31 December 2008 and 2007, are as follows:
| South | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portugal | Spain | Morocco Tunisia | Egypt | Turkey | Brazil | Mozambique | Africa | China | India | Others | Unllocated Eliminations Consolidated | ||||
| Assets Segment assets |
796,430 838,277 121,836 145,997 390,315 593,498 1,030,166 | 86,389 231,482 162,226 97,752 47,132 | 719,785 | (743,693) | 4,517,592 | ||||||||||
| Investments in associates | 97,663 | ||||||||||||||
| Total consolidated assets | 4,615,255 | ||||||||||||||
| Liabilites Segment liabilities |
316,096 550,718 | 29,304 | 14,799 | 50,003 103,648 | 262,391 | 28,499 | 60,377 130,690 28,221 18,947 | 2,149,473 | (743,693) | 2,999,470 | |||||
| Total consolidated liabilities | 2,999,470 |
| South | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Portugal | Spain | Morocco | Tunisia | Egypt | Turkey | Brazil | Mozambique | Africa | China | Others | Unllocated | Eliminations Consolidated | ||
| Assets Segment assets |
773,578 609,813 | 132,615 150,787 301,719 688,862 1,221,136 | 69,618 259,425 67,476 | 54,141 | 768,532 | (427,267) | 4,670,435 | |||||||
| Investments in associates | 163,533 | |||||||||||||
| Total consolidated assets | 4,833,968 | |||||||||||||
| Liabilites Segment liabilities |
472,549 362,502 | 33,710 | 16,348 | 39,749 | 73,763 | 320,162 | 24,035 | 69,712 42,472 | 27,105 | 1,879,846 | (427,267) | 2,934,687 | ||
| Total consolidated liabilities | 2,934,687 |
Following is a break-down of the information for the years ended 31 December 2008 and 2007, by business segment:
| 2008 | |||
|---|---|---|---|
| Sales and services rendered |
Net assets | Fixed capital expenditure |
|
| Cement | 1,517,530 | 3,767,339 | 348,505 |
| Ready-mix and precast concrete | 498,538 | 540,109 | 75,109 |
| Others | 72,794 | 307,807 | 33,512 |
| 2,088,862 | 4,615,255 | 457,126 | |
| 2007 | |||
| Sales and | Fixed capital | ||
| services rendered | Net assets | expenditure | |
| Cement | 1,360,307 | 3,541,286 | 461,309 |
| Ready-mix and precast concrete | 521,518 | 493,435 | 29,994 |
| Others | 84,232 | 799,247 | 9,180 |
| 1,966,058 | 4,833,968 | 500,483 |
Other operating income for the years ended 31 December 2008 and 2007 is made up as follows:
| 2008 | 2007 | |
|---|---|---|
| Supplementary income | 20,331 | 19,693 |
| Gains on the sale of assets (a) | 20,112 | 5,399 |
| Reversal of receivables adjustments (Note 26) | 5,120 | 4,179 |
| Own work for the company | 4,606 | 2,098 |
| Investment subsidies (b) | 3,806 | 7,196 |
| Reversal of inventories adjustments (Note 25) | 2,339 | 274 |
| Other | 9,287 | 8,681 |
| 65,601 | 47,519 |
The cost of goods sold and material used in production for the years ended 31 December 2008 and 2007 is made up as follows:
| 2008 | 2007 | |
|---|---|---|
| Goods sold | 67,166 | 109,932 |
| Material used in production | 563,603 | 429,173 |
| Gain/(loss) on inventories | 167 | 212 |
| 630,936 | 539,317 |
The average number of employees of the companies included in the consolidation in the years ended 31 December 2008 and 2007, by business and geographical segment, was as follows:
| 2008 | 2007 | |
|---|---|---|
| Cement operations: | 5,266 | 4,378 |
| Portugal | 682 | 694 |
| Spain | 495 | 501 |
| Brazil | 725 | 707 |
| Egypt | 458 | 462 |
| Tunisia | 221 | 228 |
| Morocco | 179 | 182 |
| South Africa | 356 | 278 |
| Turkey | 631 | 527 |
| China | 625 | 303 |
| India | 414 | - (a) |
| Others | 481 | 496 |
| Ready-mix concrete and aggregates: | 2,149 | 1,881 |
| Portugal | 583 | 591 |
| Spain | 452 | 430 |
| Brazil | 583 | 500 |
| Morocco | 25 | 23 |
| South Africa | 185 | 144 |
| Turkey | 167 | 95 |
| Others | 155 | 98 |
| Other activities | 194 | 189 |
| Common functions | 534 | 509 |
| 8,143 | 6,957 |
(a) Not applicable in the year ended 31 December 2007.
Payroll expenses for the years ended 31 December 2008 and 2007 are made up as follows:
| 2008 | 2007 |
|---|---|
| 161,263 | 145,384 |
| 34,307 | 29,665 |
| 21,580 | 23,152 |
| 3,324 | 2,450 |
| 2,003 | 1,726 |
| 1,136 | 1,354 |
| 737 | 732 |
| 526 | 2,608 |
| 224,875 | 207,070 |
The caption "Social action and other" includes occupational health, healthcare assistance, professional training and meal allowance costs.
Other operations expenses for the years ended 31 December 2008 and 2007 are made up as follows:
| 2008 | 2007 | |
|---|---|---|
| Receivables adjustments (Note 26) | 9,330 | 7,652 |
| Taxes | 9,913 | 6,586 |
| Subscriptions | 3,289 | 3,064 |
| Fines and penalties | 2,490 | 382 |
| Donations | 1,296 | 2,170 |
| Inventory adjustments (Note 25) | 699 | 1,058 |
| Uncollectible debts | 390 | 445 |
| Loss on disposal of assets | 568 | 1,161 |
| Other | 2,775 | 2,645 |
| 30,749 | 25,163 |
Net financial expenses for the years ended 31 December 2008 and 2007 are made up as follows:
| 2008 | 2007 | |
|---|---|---|
| Financial expenses: | ||
| Interest expense: | ||
| Changes in fair-value: | ||
| Hedged assets / liabilities | 9,295 | - |
| Trading derivative financial instruments (a) | 13,566 | 7,753 |
| Financial assets/liabilities at fair value (a) | 367 | 2,128 |
| 23,227 | 9,880 | |
| Other | 114,614 | 86,492 |
| 137,841 | 96,372 | |
| Foreign exchange loss: | ||
| Changes in fair-value: | ||
| Hedged assets / liabilities | 7,700 | 2,286 |
| Trading derivative financial instruments (a) | 110 | 32,320 |
| Financial assets/liabilities at fair value (a) | 15,855 | - |
| 23,664 | 34,606 | |
| Other | 12,716 | 8,757 |
| 36,380 | 43,364 | |
| Financial discount allowed | 3,401 | 3,327 |
| Other financial expenses (b) | 10,194 | 15,730 |
| 187,816 | 158,794 | |
| Financial income: | ||
| Interest income: | ||
| Changes in fair-value: | ||
| Hedging derivative financial instruments | 9,295 | - |
| Trading derivative financial instruments (a) | 41,920 | 15,531 |
| Financial assets/liabilities at fair value (a) | 44 | 217 |
| 51,259 | 15,748 | |
| Other | 32,093 | 29,407 |
| 83,352 | 45,155 | |
| Foreign exchange gain: | ||
| Changes in fair-value: | ||
| Hedging derivative financial instruments | 7,700 | 2,286 |
| Trading derivative financial instruments | 15,862 | - |
| Financial assets/liabilities at fair value (a) | - | 32,320 |
| 23,562 | 34,606 | |
| Other | 24,622 | 7,846 |
| 48,183 | 42,452 | |
| Financial discount received | 716 | 729 |
| Other financial income (c ) | 6,375 | 12,154 |
| 138,627 | 100,490 | |
| Share of profits of associates: | ||
| Loss in associated companies (Note 19) | (87,609) | (242) |
| Gain in associated companies (Note 19) | 853 | 8,025 |
| (86,755) | 7,782 | |
| Other | 21 | 242 |
| (86,735) | 8,025 | |
| Investment income: | ||
| Gains on holdings | 542 | 557 |
| Gains/(losses) on investments (d) | 995 | 1,734 |
| 1,537 | 2,291 |
Income tax expense for the years ended 31 December 2008 and 2007 is made up as follows:
| 2008 | 2007 | |
|---|---|---|
| Current tax | 68,471 | 68,180 |
| Deferred tax (Note 24) | 2,264 | (3,599) |
| Increases / (decreases) in tax provisions (Note 35) | (45,786) | 4,760 |
| Charge for the year | 24,949 | 69,341 |
The Company and the majority of its subsidiaries in Portugal are subject to Corporate Income Tax, currently at the rate of 25%, plus a Municipal surcharge up to a maximum of 1.5% of taxable income, totalling 26.5%.
Tax on income relating to the other geographic segments is calculated at respective rates in force, as follows:
| 2008 | 2007 | |
|---|---|---|
| Spain | 30.0% | 32.5% |
| Morroco | 30.0% | 35.0% |
| Tunisia | 30.0% | 30.0% |
| Egypt | 20.0% | 20.0% |
| Brazil | 34.0% | 34.0% |
| Mozambique | 32.0% | 32.0% |
| South Africa | 28.0% | 29.0% |
| Cape Verde | 25.5% | 30.6% |
| Turkey | 20.0% | 20.0% |
| China | 25.0% | 33.0% |
| Peru | 30.0% | 30.0% |
| India | 34.0% | - |
Temporary differences between the book value of assets and liabilities and their corresponding value for tax purposes are recognised in accordance with IAS 12 - Income taxes.
The reconciliation between the tax rate applicable in Portugal and the effective tax rate in the Group is as follows:
| 2008 | 2007 | |
|---|---|---|
| Tax rate applicable in Portugal | 26.50% | 26.50% |
| Operational results non taxable (a) | (2.78%) | (2.52%) |
| Financial results non taxable (b) | 6.47% | (2.06%) |
| Benefits by deduction to the taxable profit and to the collect | (3.85%) | (1.42%) |
| Increases / (decreases) in tax provisions (c) | (17.73%) | 1.22% |
| Adjustments on deferred taxes (d) | 0.21% | (5.66%) |
| Rate differences | 1.26% | 1.26% |
| Other | (0.42%) | 0.45% |
| Effective tax rate of the Group | 9.66% | 17.77% |
a) Included in this item are the profits of tax exempt companies and transactions that are not relevant for tax purposes.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2008 (Amounts stated in thousands of euros) (Translation of notes originally issued in Portuguese – Note 50)
In addition to the income tax charge for the year, in the years ended 31 December 2008 and 2007, deferred taxes of (230) thousand euros and 2,430 thousand euros, respectively, were recorded directly in reserves (Note 24).
In the year ended 31 December 2008 a dividend of 23 cents per share (21.5 cents per share in 2007), totalling 153,151 thousand euros (143,951 thousand euros in 2007), was paid as decided by the Shareholders' Annual General Meeting held on 9 May 2008.
In relation to the financial year ended on 31 December 2008, the Board of Directors proposes a dividend of 18.5 cents per share, subject to approval by the General Meeting of the shareholders to be held on 13 May 2009.
Basic and diluted earnings per share for the years ended 31 December 2008 and 2007 were computed as follows:
| 2008 | 2007 | |
|---|---|---|
| Basic earnings per share | ||
| Net profit considered in the computation of basic earnings per share | 219,441 | 304,073 |
| Weighted average number of ordinary shares used to calculate the basic earnings per share (thousands) |
665,303 | 669,095 |
| Basic earnings per share | 0.33 | 0.45 |
| Diluted earnings per share | ||
| Net profit considered in the computation of basic earnings per share | 219,441 | 304,073 |
| Weighted average number of ordinary shares used to calculate the basic earnings per share (thousands) |
665,303 | 669,095 |
| Effect of the options granted under the Share Option Plan (thousands) (Note 34) |
1,515 | 1,491 |
| Weighted average number of ordinary shares used to calculate the diluted earnings per share (thousands) |
666,818 | 670,586 |
| Diluted earnings per share | 0.33 | 0.45 |
The changes in goodwill and related impairment losses in the years ended 31 December 2008 and 2007 were as follows:
| Portugal | Spain | Brazil | Egypt | Tunisia | Morocco | South Africa |
Cape Verde |
Turkey | China | India | Peru | Mozambique | Total | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross assets: | ||||||||||||||
| Balances at 1 January 2007 | 22,325 | 74,427 | 540,613 | 76,614 | 71,546 | 27,254 | 112,438 | 8,742 | - | - | - | - | 1,409 | 935,368 |
| Changes in the consolidation perimeter | - | - | 1,054 | - | - | - | - | 261 | 321,748 | 4,072 | - | 3,626 | (37) | 330,725 |
| Currency translation adjustments | - | - | 30,071 | (5,533) | - | - | (9,163) | - | 26,119 | (185) | - | (102) | (321) | 40,885 |
| Additions | 223 | - | - | - | - | - | - | - | 2,260 | 860 | - | - | 1,471 | 4,814 |
| Transfers | - | (2,654) | - | - | - | - | - | - | - | - | - | - | - | (2,654) |
| Balances at 1 January 2008 | 22,548 | 71,773 | 571,738 | 71,081 | 71,546 | 27,254 | 103,275 | 9,003 | 350,127 | 4,747 | - | 3,524 | 2,523 | 1,309,139 |
| Changes in the consolidation perimeter (Note 5 | 3,103 | 68,736 | 991 | - | - | - | - | - | 2,335 | 13,284 | 68,374 | - | - | 156,823 |
| Currency translation adjustments | - | - | (78,428) | 3,898 | - | - | (24,003) | - | (70,503) | 785 | (5,484) | 218 | 146 | (173,371) |
| Additions | - | 7,855 | - | - | - | - | - | 133 | 638 | - | - | 1,757 | - | 10,383 |
| Write-offs | - | (765) | - | - | - | - | - | - | - | - | - | - | - | (765) |
| Transfers | 3,812 | (6,684) | - | - | - | - | - | - | 689 | 1,911 | - | (296) | - | (569) |
| Balances at 31 December 2008 | 29,463 | 140,914 | 494,301 | 74,979 | 71,546 | 27,254 | 79,272 | 9,136 | 283,286 | 20,726 | 62,890 | 5,203 | 2,668 | 1,301,640 |
| Accumulated impairment losses: | ||||||||||||||
| Balances at 1 January 2007 | 601 | 765 | - | - | - | 24,031 | - | - | - | - | - | - | - | 25,397 |
| Increases | - | - | - | - | - | - | - | - | - | - | - | - | - | - |
| Balances at 1 January 2008 | 601 | 765 | - | - | - | 24,031 | - | - | - | - | - | - | - | 25,397 |
| Increases | - | (765) | - | - | - | - | - | - | - | - | - | - | - | (765) |
| Balances at 31 December 2008 | 601 | - | - | - | - | 24,031 | - | - | - | - | - | - | - | 24,632 |
| Carrying amount: As at 31 December 2007 |
21,947 | 71,008 | 571,738 | 71,081 | 71,546 | 3,223 | 103,275 | 9,003 | 350,127 | 4,747 | - | 3,524 | 2,523 | 1,283,741 |
| As at 31 December 2008 | 28,862 | 140,914 | 494,301 | 74,979 | 71,546 | 3,223 | 79,272 | 9,136 | 283,286 | 20,726 | 62,890 | 5,203 | 2,668 | 1,277,008 |
Goodwill is subject to impairment tests annually and whenever there are indications of possible impairment.
The impairment tests are made based on the recoverable amounts of each of the corresponding business segments (Note 2.3.).
For impairment test purposes, considering the financial statement structure adopted for management purposes, goodwill is distributed by groups of cash generating units corresponding to each geographic segment, due to the existence of synergies between the units of each segment.
The recoverable value of each group of cash-generating units is compared, in the tests performed, with the respective book value. An impairment loss is only recognised when the book value exceeds the higher of the value in use and transaction value. For the value in use, the future cash flows are discounted based on the weighted average cost of capital (WACC), adjusted for the specific risks of each market. For the transaction value, multiples based on business indicators (mainly EBITDA and production capacity), are compared with those calculated for the cashgenerating units undergoing these tests.
The cash flow projections are based on the medium and long term business plans approved by the Board of Directors, plus perpetuity.
The main assumptions used to determine the value for use of goodwill were as follows:
| 2008 | 2007 | ||||||
|---|---|---|---|---|---|---|---|
| Discount | Long term | Discount | Long term | ||||
| Geographic area | Currency | Goodwill (a) | rate (b) | rate | Goodwill (a) | rate (b) | rate |
| Brazil | BRL | 494,301 | 8.0% | 3.3% | 571,738 | 8.9% | 3.6% |
| Egypt | EGP | 74,979 | 8.8% | 5.5% | 71,081 | 8.7% | 4.7% |
| Spain | EUR | 140,914 | 6.7% | 1.5% | 71,008 | 7.1% | 2.0% |
| South Africa | ZAR | 79,272 | 7.4% | 4.4% | 103,275 | 7.9% | 4.5% |
| Morocco | MAD | 3,223 | 8.3% | 2.1% | 3,223 | 8.9% | 2.3% |
| Tunisia | TND | 71,546 | 7.7% | 1.9% | 71,546 | 8.2% | 2.7% |
| Portugal | EUR | 28,862 | 7.0% | 1.4% | 21,947 | 7.7% | 2.3% |
| Cape Verde | CVE | 9,136 | 10.6% | 1.1% | 9,003 | 10.4% | 3.0% |
| Mozambique | MZM | 2,668 | 10.5% | 5.0% | 2,523 | 10.8% | 8.7% |
| Turkey | TRY | 283,286 | 10.4% | 3.9% | 350,127 | 10.2% | 4.1% |
| China | CNY | 20,726 | 7.4% | 3.7% | 4,747 | 7.7% | 3.8% |
| Peru | PEN | 5,203 | 8.0% | 2.0% | 3,524 | - | - |
| India | INR | 62,890 | 8.7% | 4.7% | - | ||
| 1,277,008 | 1,283,741 |
a) In euros
b) In local currency
The changes in intangible assets and corresponding accumulated amortisation and impairment losses in the years ended 31 December 2008 and 2007 were as follows:
| Industrial property and other rights |
Intangible assets in progress |
Total | |
|---|---|---|---|
| Gross assets: | |||
| Balances at 1 January 2007 | 15,765 | 650 | 16,415 |
| Changes in the consolidation perimeter | 9,091 | 11 | 9,102 |
| Currency translation adjustments | 694 | (24) | 671 |
| Additions | 1,665 | 229 | 1,894 |
| Write-offs | (173) | - | (173) |
| Transfers | 756 | (782) | (27) |
| Balances at 1 January 2008 | 27,796 | 84 | 27,880 |
| Changes in the consolidation perimeter (Note 5) | 22,839 | 176 | 23,016 |
| Currency translation adjustments | (2,466) | 1 | (2,466) |
| Additions | 10,175 | 69 | 10,244 |
| Write-offs, sales and transfers | (89) | - | (89) |
| Balance at 31 December 2008 | 58,255 | 330 | 58,585 |
| Industrial property and other rights |
Intangible assets in progress |
Total | |
|---|---|---|---|
| Accumulated amortisation and | |||
| impairment losses: | |||
| Balances at 1 January 2007 | 5,695 | - | 5,695 |
| Changes in the consolidation perimeter | 6,400 | - | 6,400 |
| Currency translation adjustments | 585 | - | 585 |
| Increases | 2,069 | - | 2,069 |
| Write-offs | (170) | - | (170) |
| Balances at 1 January 2008 | 14,578 | - | 14,578 |
| Changes in the consolidation perimeter (Note 5) | 28 | - | 28 |
| Currency translation adjustments | (2,079) | - | (2,079) |
| Increases | 3,506 | - | 3,506 |
| Write-offs and transfers | 22 | - | 22 |
| Balance at 31 December 2008 | 16,055 | - | 16,055 |
| Carrying amount: | |||
| As at 31 December 2007 | 13,219 | 84 | 13,303 |
| As at 31 December 2008 | 42,201 | 330 | 42,531 |
The caption "Industrial property and other rights" includes, essentially, surface rights over land and software utilisation licences. The increase on the 2007 figures is basically due to surface and operating rights in the Spain and China business areas, in the amount of 22,166 thousand euros and 4,923 thousand euros, respectively.
The changes in tangible assets and corresponding depreciation in the years ended 31 December 2008 and 2007 were as follows:
| Buildings and | Tangible | Advance to | ||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| other | Basic | Transportation | Administrative | Tools and | Other tangible | assets in | suppliers of | |||
| Land | constructions | equipment | equipment | equipment | dies | assets | progress | tangible assets | Total | |
| Gross assets: | ||||||||||
| Balances at 1 January 2007 | 292,696 | 586,681 | 2,491,266 | 90,707 | 52,476 | 7,787 | 11,516 | 111,924 | 7,557 | 3,652,611 |
| Changes in the consolidation perimeter | 40,289 | 77,015 | 354,311 | 13,674 | 2,178 | 746 | 99 | 19,096 | 4,313 | 511,720 |
| Currency translation adjustments | 5,624 | 6,422 | 13,653 | 1,350 | 147 | (139) | (75) | (1,844) | 905 | 26,044 |
| Additions | 1,878 | 13,313 | 54,212 | 5,837 | 4,942 | 424 | 352 | 131,237 | 19,513 | 231,708 |
| Sales | (420) | (861) | (11,620) | (4,830) | (424) | (213) | (237) | (44) | (769) | (19,418) |
| Write-offs | (1) | (311) | (12,228) | (5,240) | (837) | (22) | (17) | (5) | - | (18,661) |
| Transfers | 5,058 | 30,774 | 44,641 | 7,052 | 581 | 676 | 90 | (72,164) | (6,684) | 10,024 |
| Balances at 1 January 2008 | 345,125 | 713,032 | 2,934,234 | 108,550 | 59,063 | 9,260 | 11,728 | 188,200 | 24,836 | 4,394,029 |
| Changes in the consolidation perimeter (Note 5) | 6,665 | 10,240 | 67,858 | 4,928 | 870 | 647 | (31) | 8,000 | 63,976 | 163,153 |
| Currency translation adjustments | (21,331) | (32,392) | (200,118) | (9,209) | (3,394) | 2 | 22 | (29,057) | (2,771) | (298,247) |
| Additions | 11,382 | 37,949 | 93,088 | 3,635 | 2,330 | 491 | 1,286 | 102,664 | 34,944 | 287,770 |
| Sales | (1,560) | (3,954) | (12,763) | (2,637) | (484) | (35) | (145) | (23) | (4,111) | (25,713) |
| Write-offs | (36) | (159) | (17,876) | (411) | (513) | (43) | (163) | (442) | (3) | (19,648) |
| Transfers | 9,414 | 19,838 | 58,113 | 2,292 | 1,138 | 1,959 | (1,603) | (83,369) | (229) | 7,552 |
| Balances at 31 December 2008 | 349,659 | 744,553 | 2,922,537 | 107,147 | 59,010 | 12,281 | 11,094 | 185,973 | 116,642 | 4,508,895 |
| Accumulated depreciation and | ||||||||||
| impairment losses: | ||||||||||
| Balances at 1 January 2007 | 37,460 | 285,301 | 1,672,817 | 59,456 | 42,240 | 6,786 | 6,778 | - | - | 2,110,837 |
| Changes in the consolidation perimeter | 176 | 28,351 | 206,016 | 8,686 | 3,618 | 649 | 44 | - | - | 247,540 |
| Currency translation adjustments | 155 | 5,097 | 9,166 | 663 | 326 | (110) | (59) | - | - | 15,238 |
| Increases | 4,150 | 26,946 | 118,773 | 8,232 | 3,360 | 482 | 1,040 | - | - | 162,983 |
| Decreases | (29) | (420) | (10,158) | (4,039) | (385) | (210) | (177) | - | - | (15,418) |
| Write-offs | - | (7,881) | (10,454) | (5,204) | (782) | (22) | (17) | - | - | (24,360) |
| Transfers | 386 | 9,180 | (7,408) | 35 | 29 | 0 | (70) | - | - | 2,152 |
| Balances at 1 January 2008 | 42,298 | 346,575 | 1,978,753 | 67,828 | 48,406 | 7,575 | 7,539 | - | - | 2,498,974 |
| Changes in the consolidation perimeter (Note 5) | 77 | 1,240 | 23,343 | 1,605 | 617 | 189 | (44) | - | - | 27,028 |
| Currency translation adjustments | (1,792) | (16,171) | (143,188) | (5,750) | (2,636) | 47 | 23 | - | - | (169,467) |
| Increases | 11,881 | 30,811 | 124,558 | 9,314 | 3,332 | 632 | 538 | - | - | 181,067 |
| Decreases | (1) | (1,672) | (11,272) | (2,445) | (263) | (35) | (185) | - | - | (15,873) |
| Write-offs | - | (113) | (17,625) | (290) | (499) | (43) | (40) | - | - | (18,611) |
| Transfers | 525 | (463) | (2,442) | 53 | 727 | 1,108 | (1,655) | - | - | (2,147) |
| Balances at 31 December 2008 | 52,989 | 360,206 | 1,952,127 | 70,315 | 49,683 | 9,473 | 6,177 | - | - | 2,500,969 |
| Carrying amount: | ||||||||||
| As at 31 December 2007 | 302,827 | 366,457 | 955,482 | 40,722 | 10,658 | 1,684 | 4,189 | 188,200 | 24,836 | 1,895,055 |
| As at 31 December 2008 | 296,671 | 384,346 | 970,410 | 36,832 | 9,327 | 2,808 | 4,917 | 185,973 | 116,642 | 2,007,926 |
The value of the operating land was increased to reflect the estimated future cost of environmental recovery and rehabilitation of the land, which also increased liabilities.
The additions during the financial year ended on 31 December 2008 include 8,352 thousand euros in financial costs related to loans contracted to finance the construction of qualifying assets.
The write-offs in the financial year ended on 31 December 2008 include the sum of 17,150 thousand euros relative to the impact of the replacement of a kiln at a plant in Spain (Symca), due to the equipment becoming obsolete as the result of the investment made.
Tangible assets in progress in the year ended 31 December 2008 include the construction and improvement of installations and equipment of the cement sector of several production units, essentially in the Turkey, Spain, Brazil and China business areas.
The advances to suppliers of tangible assets item includes the assets assigned to the manufacturing and marketing of cement and ready-mix concrete on the island of Tenerife (Note 5).
The changes in investments in associates in the years ended 31 December 2008 and 2007 are as follows:
| Investment | Goodwill | Total | |
|---|---|---|---|
| Balances at 1 January 2007 | 142,139 | 14,816 | 156,955 |
| Changes in the consolidation perimeter Equity method effect: |
(3,874) | 205 | (3,669) |
| On profit (Note 12) | 8,025 | - | 8,025 |
| On shareholders' equity | 3,216 | - | 3,216 |
| Dividends received | (1,295) | - | (1,295) |
| Acquisitions and increases | 302 | - | 302 |
| Balances at 1 January 2008 | 148,512 | 15,021 | 163,533 |
| Changes in the consolidation perimeter (Note 5) Equity method effect: |
11,091 | - | 11,091 |
| On profit (Note 12) | (86,755) | - | (86,755) |
| On shareholders' equity (Note 30) | (3,296) | - | (3,296) |
| Dividends received | (1,175) | - | (1,175) |
| Acquisitions and increases | 15,988 | - | 15,988 |
| Sales and write-offs | (307) | - | (307) |
| Transfers | - | (1,416) | (1,416) |
| Balances at 31 December 2008 | 84,057 | 13,606 | 97,663 |
The profit/loss of associate companies for the financial year ended on 31 December 2008 include the Group's stake in the loss of C+PA and Arenor, in the amounts of 78.4 million of euros and 7,3 million of euros, respectively, which are negatively influenced by approximately 77 million of euros owing to the recognition of impairment losses on financial assets available for sale (shares of Banco Comercial Português, S.A.).
Financial information on associates as of 31 December 2008 and 2007 is as follows:
| 2008 | 2007 | |
|---|---|---|
| Total assets Total liabilities Total shareholders' equity |
391,806 (152,239) 239,567 |
474,748 (123,516) 351,232 |
| Group's share of shareholders' equity | 97,663 | 163,533 |
| Sales and services rendered | 42,065 | 98,994 |
| Net profit for the year | (189,758) | 22,809 |
| Group's share of net profit for the year | (86,755) | 7,782 |
The changes in "Other investments" in the years ended 31 December 2008 and 2007 were as follows:
| Available-for-sale financial assets |
Financial assets at fair-value through |
Held to maturity | ||||
|---|---|---|---|---|---|---|
| Cost | Fair value | profit and loss | financial assets | Total | ||
| Gross investment: | ||||||
| Balances at 1 January 2007 | 169,933 | - | - | - | 169,933 | |
| Currency translation adjustments | (42) | (618) | - | 11,471 | 10,811 | |
| Revaluation/adjustments | - | 2,111 | - | - | 2,111 | |
| Increases | 2,921 | - | - | - | 2,921 | |
| Transfers | (158,008) | 8,261 | - | 138,199 | (11,548) | |
| Balances at 1 January 2008 | 14,804 | 9,754 | - | 149,669 | 174,227 | |
| Changes in the consolidation perimeter (Note 5) | 298 | - | 106 | - | 404 | |
| Currency translation adjustments | (353) | 30 | (9) | (29,869) | (30,200) | |
| Revaluation/adjustments | - | 499 | (1,091) | - | (592) | |
| Increases | 314 | 2,195 | 4,022 | - | 6,531 | |
| Transfers | (2,806) | - | - | - | (2,806) | |
| Sales | (1,872) | (8,382) | - | - | (10,254) | |
| Write-offs | (34) | - | - | - | (34) | |
| Balances at 31 December 2008 | 10,352 | 4,096 | 3,029 | 119,801 | 137,277 | |
| Impairment losses: | ||||||
| Balances at 1 January 2007 | 16,595 | - | - | - | 16,595 | |
| Currency translation adjustments | 85 | - | - | - | 85 | |
| Increases | 1,080 | - | - | - | 1,080 | |
| Transfers | (7,846) | - | - | - | (7,846) | |
| Balances at 1 January 2008 | 9,914 | - | - | - | 9,914 | |
| Currency translation adjustments | (35) | - | - | - | (35) | |
| Transfers | (2,695) | - | - | - | (2,695) | |
| Sales | (1,301) | - | - | - | (1,301) | |
| Balances at 31 December 2008 | 5,882 | - | - | - | 5,882 | |
| Carrying amount: | ||||||
| As at 31 December 2007 | 4,890 | 9,754 | - | 149,669 | 164,314 | |
| As at 31 December 2008 | 4,470 | 4,096 | 3,029 | 119,801 | 131,395 |
In this caption are included: (i) the available-for-sale financial assets, measured at fair value, both at acquisition cost, when there's no market price quoted in an active market and which value cannot be measured in a reliable way, adjusted to the estimated impairment losses; (ii) financial assets at fair value through profit and loss, constituted, essentially, by a portfolio of investment fund, and (iii) financial assets held to maturity, namely an instrument issued by the Republic of Austria.
In the year ended 31 December 2008, the Group sold the investment in Misr Cement (Qena), S.A.E. measured by 8,382 thousand euros. Additionally, the accumulated amount in reserves was transferred to profit and loss, totalising a profit of 2,086 thousand euros.
This caption at 31 December 2008 and 2007 was made up as follows:
| 2008 | 2007 | |||
|---|---|---|---|---|
| Current | Non-current | Current | Non-current | |
| Participated and participating companies | 622 | 875 | 622 | 2,000 |
| Other shareholders | 843 | 389 | 713 | 283 |
| Advances to suppliers or fixed assets | 32 | - | 38 | - |
| Other debtors | 30,169 | 10,299 | 22,934 | 12,244 |
| 31,666 | 11,563 | 24,307 | 14,527 | |
| Accumulated adjustments to other receivable accounts | (2,034) | (680) | (1,507) | (2,646) |
| 29,633 | 10,883 | 22,800 | 11,880 |
In the years ended 31 December 2008 and 2007, those accounts receivable ageing were as follow:
| 2008 | 2007 | ||||
|---|---|---|---|---|---|
| Current | Non-current | Current | Non-current | ||
| Undue balances | 26,420 | 10,916 | 21,125 | 10,486 | |
| Due balances: | |||||
| Up to 180 days | 2,055 | - | 1,031 | 500 | |
| From 180 to 360 days | 127 | - | 233 | 1,000 | |
| More than 360 days | 3,063 | 647 | 1,918 | 2,541 | |
| 31,666 | 11,563 | 24,307 | 14,527 |
In the years ended 31 December 2008 and 2007 the changes in this caption were as follows:
| Balances at 1 January 2007 | 9,613 |
|---|---|
| Currency translation adjustments | (34) |
| Increases | 1,574 |
| Decreases (Note 12) | (7,000) |
| Balances at 1 January 2008 | 4,154 |
| Changes in the consolidation perimeter | 38 |
| Currency translation adjustments | 289 |
| Increases | 886 |
| Decreases | (2,599) |
| Utilisation | (53) |
| Balances at 31 December 2008 | 2,714 |
Taxes recoverable and taxes payable at 31 December 2008 and 2007 were made up as follows:
| 2008 | 2007 | ||||
|---|---|---|---|---|---|
| Current | Non-current | Current | Non-current | ||
| Taxes recoverable: | |||||
| Corporate income tax | 7,504 | - | 12,575 | - | |
| Personal income tax | 4,365 | - | 2,851 | - | |
| Value added tax | 28,802 | - | 12,350 | - | |
| Social security contributions | - | - | 172 | - | |
| Other | 2,678 | 16,349 | 1,912 | 20,488 | |
| 43,349 | 16,349 | 29,860 | 20,488 | ||
| 2008 | 2007 | ||||
| Current | Non-current | Current | Non-current | ||
| Taxes payable: | |||||
| Corporate income tax | 14,513 | - | 18,033 | - | |
| Personal income tax | 3,846 | - | 4,463 | - | |
| Value added tax | 13,971 | 1,499 | 14,498 | 1,817 | |
| Social security contributions | 4,530 | - | 4,599 | - | |
| Other | 4,275 | - | 3,373 | - | |
| 41,135 | 1,499 | 44,967 | 1,817 |
In the years ended 31 December 2008 and 2007, non-current recoverable taxes in the caption 'Other', include a judicial deposit in the amount of 15,620 thousand euros and 15,891 thousand euros, respectively, made by a subsidiary in the Brazil business area, due to a judicial divergence in relation with the relevant applicable tax rate. The Board of Directors, according to previous similar processes and lawyer's opinion, believes that its resolution could be favorable to the company.
Other current and non-current assets at 31 December 2008 and 2007 are made up as follows:
| 2008 | 2007 | |||
|---|---|---|---|---|
| Current | Non-current | Current | Non-current | |
| Accrued interest | 1,360 | - | 1,669 | - |
| Derivative financial instruments (Note 38) | 4,492 | 16,527 | 840 | 4,655 |
| Leases (a) | 1,227 | 16,987 | 609 | - |
| Employee benefits (Note 33) | 227 | - | 647 | - |
| Insurances | 591 | - | 630 | - |
| Other deferred costs and accrued income | 2,855 | 361 | 2,078 | - |
| 10,751 | 33,874 | 6,474 | 4,655 |
(a) In 2008, in connection with the acquisition of Arenor Áridos, S.L. (Note 5), was concluded a contract of lease of land for aggregate extraction and the respective exploitation right for a period of 57 months, amounting to 18,440 thousand euros.
The changes in deferred taxes in the years ended 31 December 2008 and 2007 were as follows:
| Intangible assets |
Goodwill | Tangible assets |
Tax losses carried forward |
Provisions for risks and charges |
Cash and cash equivalents |
Doubtful accounts |
Inventories Investments | Available for-sale financial assets |
Other | Total | ||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Deferred tax assets: | ||||||||||||
| Balances at 1 January 2007 | 1,359 | 22,056 | 11,803 | 4,881 | 16,607 | - | 1,702 | 1,986 | 1,815 | - | 18,950 | 81,159 |
| Changes in the consolidation perimeter | - | - | - | 206 | 1,170 | - | 27 | - | - | - | 146 | 1,549 |
| Currency translation adjustments | 39 | 2,515 | 312 | 278 | 507 | - | (29) | (51) | 1 | - | 70 | 3,644 |
| Income tax (Note 13) | (183) | 24,450 | 1,888 | 4,432 | 4,649 | - | 484 | 252 | (959) | - | (762) | 34,251 |
| Shareholders' equity (Note 13) | - | - | - | - | (2,003) | - | - | - | - | - | 4,585 | 2,582 |
| Balances at 1 January 2008 | 1,215 | 49,021 | 14,003 | 9,798 | 20,929 | - | 2,185 | 2,187 | 856 | - | 22,990 | 123,185 |
| Changes in the consolidation perimeter (Note 5) | - | - | (12) | 7,239 | 1,482 | - | 191 | - | - | - | - | 8,899 |
| Currency translation adjustments | (77) | (8,315) | (1,591) | (2,445) | (2,756) | - | (77) | 21 | (5) | - | (1,744) | (16,989) |
| Income tax (Note 13) | (609) | (8,479) | (3,032) | 3,256 | (333) | - | (698) | (642) | (78) | - | (1,128) | (11,742) |
| Shareholders' equity (Note 13) | - | - | - | - | 1,240 | - | - | - | - | - | (1,406) | (165) |
| Transfers | 1 | - | - | (137) | 0 | - | (11) | - | - | - | (1) | (148) |
| Balances at 31 December 2008 | 530 | 32,226 | 9,368 | 17,711 | 20,563 | - | 1,590 | 1,567 | 774 | - | 18,711 | 103,039 |
| Intangible assets |
Goodwill | Tangible assets |
Tax losses carried forward |
Provisions for risks and charges |
Cash and cash equivalents |
Doubtful accounts |
Inventories Investments | Available for-sale financial assets |
Other | Total | ||
| Deferred tax liabilities: | ||||||||||||
| Balances at 1 January 2007 | - | 12,250 | 100,877 | - | 3,606 | 233 | - | - | 12,500 | - | 6,589 | 136,055 |
| Changes in the consolidation perimeter | - | - | 29,816 | - | - | - | - | - | - | - | 128 | 29,945 |
| Currency translation adjustments | 5 | 359 | 760 | - | (3) | - | - | - | - | - | 326 | 1,447 |
| Income tax (Note 13) | 130 | 26,492 | 4,789 | - | 67 | (233) | - | - | (962) | - | 369 | 30,652 |
| Shareholders' equity (Note 13) | - | - | - | - | 529 | - | - | - | - | 13 | (390) | 152 |
| Balances at 1 January 2008 | 134 | 39,100 | 136,242 | - | 4,199 | - | - | - | 11,539 | 13 | 7,022 | 198,249 |
| Changes in the consolidation perimeter (Note 5) | 7,892 | - | 4,286 | - | - | - | - | - | - | - | - | 12,178 |
| Currency translation adjustments | (12) | (3,041) | (7,174) | - | (9) | - | - | - | - | - | (1,790) | (12,026) |
| Income tax (Note 13) | (137) | 2,586 | (3,228) | - | 262 | - | - | - | (11,539) | - | 2,577 | (9,479) |
| Shareholders' equity (Note 13) | - | - | - | - | (28) | - | - | - | - | 93 | - | 65 |
| Transfers | - | - | 8,400 | - | - | - | - | - | - | - | - | 8,400 |
| Balances at 31 December 2008 | 7,878 | 38,646 | 138,525 | - | 4,423 | - | - | - | - | 106 | 7,809 | 197,388 |
| Carrying amount: | ||||||||||||
| As at 31 December 2007 | 1,081 | 9,921 | (122,239) | 9,798 | 16,731 | - | 2,185 | 2,187 | (10,682) | (13) | 15,968 | (75,064) |
| As at 31 December 2008 | (7,348) | (6,420) | (129,157) | 17,711 | 16,139 | - | 1,590 | 1,567 | 774 | (106) | 10,902 | (94,348) |
The deferred tax assets are recorded directly on shareholders' equity when the situations that have originated them have similar impact, namely:
The deferred tax assets and liabilities recorded in Reserves related to provisions, resulted from the tax effect associated to the actuarial gains and losses recorded directly in Reserves (Note 2.19.);
The deferred tax liabilities related to Available-for-sale financial assets, resulted from its valuations to market values, which are recorded on Fair value reserve.
The caption 'Other deferred tax assets' includes essentially the temporary differences of the derivative financial instruments (Note 38). The caption 'Other deferred tax liabilities', included temporary differences resulting from the financial actualization of accounts payable.
At 31 December 2008 the Group had tax losses carried forward of 118,311 thousand euros (2007: 98,119 thousand euros) for deduction from future tax profits; deferred tax asset of 17,711 thousand euros was recognised (2007: 9,798 thousand euros). Deferred tax assets of 58,439 thousand euros (2007: 65,353 thousand euros) have not been recognised due to the uncertainty as to their recovery, of which 52,826 thousand euros (2007: 58,613 thousand euros) expire in 2010.
Deferred tax assets were recognized as it is probable that future taxable profits will occur, which could be used to recover fiscal losses and temporary differences. This evaluation was performed in accordance with the company's business plans, periodically reviewed and actualized.
Inventories at 31 December 2008 and 2007 are made up as follows:
| 2008 | 2007 | |
|---|---|---|
| Raw, subsidiary and consumable materials | 227,136 | 174,036 |
| Work in process | 56,155 | 40,473 |
| Finished and semi-finished products | 35,754 | 19,326 |
| Merchandise | 10,369 | 6,896 |
| Advances on purchases | 7,364 | 725 |
| 336,778 | 241,455 | |
| Accumulated inventory adjustments | (8,929) | (10,886) |
| 327,849 | 230,569 |
The changes in inventories adjustments in the years ended 31 December 2008 and 2007 were as follows:
| Balances at 1 January 2007 | 11,979 |
|---|---|
| Changes in the consolidation perimeter | 208 |
| Currency translation adjustments | (419) |
| Increases (Note 11) | 1,058 |
| Decreases (Note 8) | (274) |
| Utilisation | (1,468) |
| Transfers | (199) |
| Balances at 1 January 2008 | 10,886 |
| Currency translation adjustments | (218) |
| Increases (Note 11) | 699 |
| Decreases (Note 8) | (2,339) |
| Utilisation | (99) |
| Balances at 31 December 2008 | 8,929 |
This caption at 31 December 2008 and 2007 was made up as follows:
| 2008 | 2007 | |
|---|---|---|
| Trade receivables | 265,697 | 276,949 |
| Notes receivable - trade | 51,737 | 57,120 |
| Doubtful trade accounts receivable | 48,710 | 46,188 |
| Advances to suppliers | 7,253 | 5,203 |
| 373,397 | 385,460 | |
| Adjustments to accounts receivable | (59,954) | (61,599) |
| 313,443 | 323,861 | |
During the years ended 31 December 2008 and 2007, the changes in this caption are made up as follows:
| Balances at 1 January 2007 | 58,683 |
|---|---|
| Changes in the consolidation perimeter | 1,903 |
| Currency translation adjustments | (206) |
| Increases (Note 11) | 7,652 |
| Decreases (Note 8) | (4,179) |
| Utilisation | (2,254) |
| Balances at 1 January 2008 | 61,599 |
| Changes in the consolidation perimeter | 879 |
| Currency translation adjustments | (1,451) |
| Increases (Note 11) | 9,330 |
| Decreases (Note 8) | (5,076) |
| Utilisation | (5,327) |
| Balances at 31 December 2008 | 59,954 |
Increases and decreases in these adjustments are recognized in the statement of profit and loss in captions 'Other operating expenses' and 'Other operating income', respectively.
In the years ended 31 December 2008 and 2007, the ageing of this caption, was as follows:
| 2008 | 2007 | |
|---|---|---|
| Undue balances | 245,972 | 255,907 |
| Due balances: | ||
| Up to 180 days | 77,557 | 69,485 |
| From 180 to 360 days | 3,777 | 8,220 |
| More than 360 days | 46,090 | 51,849 |
| 373,397 | 385,460 |
The book value of the accounts receivable is close to its fair value.
The Group does not have a significant concentration of credit risk, as the risk is spread over a broad range of trade and other debtors. The recognized adjustments represent the estimated loss on the accounts receivable, as a result of the credit risk analysis, after deducting the amounts covered by credit insurance and other warranties.
The Company's fully subscribed and paid up capital at 31 December 2008 consisted of 672,000,000 privatized shares, listed on Euronext Lisbon market, with a nominal value of one euro each.
The official qualifying shareholders are disclosed in appendix.
Commercial legislation relating to treasury shares requires that a free reserve in an amount equal to the cost of treasury shares be frozen while the shares are not sold. In addition, the applicable accounting rules require that gains and losses on the sale of treasury shares be recorded in reserves.
At 31 December 2008 and 2007 Cimpor had 8,476,832 and 4,002,209 treasury shares, respectively.
The changes in treasury shares in the years ended 31 December 2008 and 2007 were as follows:
| Quantity | Value | |
|---|---|---|
| Balances at 1 January 2007 | 2,766,810 | (9,294) |
| Treasury shares sale | (1,104,700) | 3,739 |
| Treasury shares buy | 2,340,099 | (14,371) |
| Balances at 1 January 2008 | 4,002,209 | (19,927) |
| Treasury shares sale | (1,168,620) | 3,872 |
| Treasury shares buy | 5,643,243 | (25,586) |
| Balances at 31 December 2008 | 8,476,832 | (41,640) |
Exchange translation adjustments result from the translation to euro of the foreign currency financial statements of subsidiaries included in the consolidation. In addition, this caption includes the effect of derivative financial instruments contracted to hedge investments in foreign entities (Note 38), to the extent that they comply with the criteria defined in IAS 39, as regards formalisation and efficiency of the hedge.
The changes in this caption in the years ended 31 December 2008 and 2007 were as follows:
| Balances at 1 January 2007 | 121,274 |
|---|---|
| Currency translation adjustments | 62,561 |
| Balances at 1 January 2008 | 183,834 |
| Currency translation adjustments | (333,541) |
| Balances at 31 December 2008 | (149,706) |
No derivative instruments for the purpose of hedging investment in foreign entities were contracted in the financial years ended on 31 December 2008 and 2007.
The changes in these captions in the year ended 31 December 2008 and 2007 were as follows:
| Legal reserve |
Free reserves |
Fair value reserve |
Hedging operations |
Total | |
|---|---|---|---|---|---|
| Balances at 1 January 2007 | 95,200 | 159,555 | - | 851 | 255,606 |
| Appropriation of consolidated profit | 11,700 | - | - | - | 11,700 |
| Purchase/(sale) of treasury shares | - | 476 | - | - | 476 |
| Employee bonuses and share purchase options (Note 34) | - | 1,047 | - | - | 1,047 |
| Actuarial gain and loss on employee benefit plans | - | 6,570 | - | - | 6,570 |
| Adjustments in equity investments in associates and other | - | 4,047 | - | - | 4,047 |
| Changes in fair value of hedging financial instruments | - | - | - | (9,593) | (9,593) |
| Sale of available-for-sale investments | - | - | 2,098 | - | 2,098 |
| Balances at 1 January 2008 | 106,900 | 171,695 | 2,098 | (8,742) | 271,950 |
| Appropriation of consolidated profit | 12,565 | - | - | - | 12,565 |
| Purchase/(sale) of treasury shares | - | 722 | - | - | 722 |
| Employee bonuses and share purchase options (Note 34) | - | 2,453 | - | - | 2,453 |
| Actuarial gain and loss on employee benefit plans (Note 33) | - | (2,811) | - | - | (2,811) |
| Adjustments in equity investments in associates (Note 19) | - | (3,296) | - | - | (3,296) |
| Changes in fair value of hedging financial instruments | - | - | - | 3,265 | 3,265 |
| Changes in fair value of available-for-sale investments | - | - | (1,736) | - | (1,736) |
| Balances at 31 December 2008 | 119,465 | 168,762 | 362 | (5,477) | 283,112 |
Commercial legislation establishes that at least 5% of annual net profit must be appropriated to a legal reserve until the reserve equals at least 20% of share capital. This reserve is not available for distribution except upon liquidation of the company, but can be used to absorb losses once the other reserves have been exhausted, or to increase capital.
The changes in retained earnings in the years ended 31 December 2008 and 2007 were as follows:
| Balances at 1 January 2007 | 248,177 |
|---|---|
| Appropriation of consolidated profit | 136,264 |
| Adjustments in equity investments in associates and other | (610) |
| Share purchase options (Note 34) | 678 |
| Other | (40) |
| Balances at 1 January 2008 | 384,470 |
| Appropriation of consolidated profit | 138,273 |
| Share purchase options (Note 34) | (450) |
| Actuarial gain and loss on employee benefit plans (Note 33) | (294) |
| Other | (141) |
| Balances at 31 December 2008 | 521,858 |
The changes in this caption in the years ended 31 December 2008 and 2007 were as follows:
| Balances at 1 January 2007 | 74,059 |
|---|---|
| Changes in the consolidation perimeter | 26,622 |
| Change resulting from currency translation | (1,619) |
| Dividends | (3,206) |
| Increase in investments | (9,999) |
| Employee benefits | (1) |
| Other changes in shareholders' equity of subsidiary companies | 295 |
| Net profit for the year attributable to minority interests | 16,729 |
| Balances at 1 January 2008 | 102,880 |
| Changes in the consolidation perimeter (Note 5) | 8,473 |
| Change resulting from currency translation | 2,785 |
| Dividends | (13,508) |
| Increase in investments | (2,936) |
| Employee benefits | (62) |
| Other changes in shareholders' equity of subsidiary companies | (776) |
| Net profit for the year attributable to minority interests | 13,865 |
| Balances at 31 December 2008 | 110,720 |
The Group has defined benefit retirement pension plans and healthcare plans, for which the liability is determined annually based on actuarial valuations made by independent entities, the cost determined by these valuations being recognised in the year.
Most of the liability for the retirement benefit plans has been transferred to pension funds managed by specialised independent entities.
The valuations as of 31 December 2008 and 2007 were made using the "Projected Unit Credit" method and were based in the following assumptions and technical bases:
| 2008 | 2007 | |
|---|---|---|
| Actuarial technical rate | ||
| Portugal | 6.00% | 5.00% |
| Spain | 5.00% | 5.40% |
| South Africa India |
8.40% 5.75% |
9.25% n/a |
| Morocco | 5.55% | 5.05% |
| Annual pension growth rate | ||
| Portugal | 2.50% | 2.25% |
| Spain | 2.50% | 2.50% |
| Annual fund income rate | ||
| Portugal | 6.00% | 5.00% |
| Spain | 5.90% | 5.90% |
| Annual salary growth rate | ||
| Portugal | 2.50% | 2.50% |
| Spain | 3.50% | 3.50% |
| India | 7.00% | n/a |
| Mortality tables | ||
| Portugal | TV88/90 | TV88/90 |
| Spain | PERMF 2000 | PERMF 2000 |
| South Africa | SA 85-90 | SA 85-90 |
| India | LIC | n/a |
| Morocco | TV 88/90 | TV 88/90 |
| Disability tables Portugal |
EKV 80 | EKV 80 |
| Nominal growth rate of medical costs | ||
| Portugal | ||
| Growth rate of medical costs | N/A | N/A |
| Medical inflation rate | 2.50% | 2.50% |
| Growth rate of medical costs by age | 1,5% till 60, | 1,5% till 60, |
| 2% between 60 and 85, | 2,5% between 60 and 85, | |
| -1,5% after 85 years old | -1,5% after 85 years old | |
| South Africa | 6.40% | 7.25% |
| Morocco | 3.00% | 3.00% |
In accordance with the actuarial valuations the pension and healthcare benefits costs for the last four years ended 31 December were as follows:
| Pension plans | ||||
|---|---|---|---|---|
| 2008 | 2007 | 2006 | 2005 | |
| Current service cost | 1,069 | 1,335 | 1,763 | 1,471 |
| Interest cost | 3,918 | 3,772 | 3,914 | 3,710 |
| Curtailments / settlements / constitutions | (2,601) | - | (3,386) | (1,937) |
| Expected return of the plans' assets | (3,531) | (3,667) | (4,330) | (3,758) |
| Total cost/(income) of the pension plans | (1,146) | 1,440 | (2,040) | (513) |
| Healthcare plans | ||||
| 2008 | 2007 | 2006 | 2005 | |
| Current service cost | 435 | 352 | 459 | 316 |
| Interest cost | 812 | 1,002 | 927 | 748 |
| Curtailments / settlements / constitutions | 2,042 | - | (4,469) | - |
| Total cost/(income) of the healthcare plans | 3,289 | 1,354 | (3,084) | 1,065 |
| Total cost/(income) of the defined benefit plans (Notes 10 and 35) | 2,144 | 2,795 | (5,123) | 551 |
The changes in the amount of the defined benefit plans and fund assets in the years ended 31 December 2008 and 2007 were as follows:
| Pension plans | Healthcare plans | Total | ||||
|---|---|---|---|---|---|---|
| 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |
| Defined benefit liability - 1 January | 81,645 | 88,592 | 16,096 | 20,833 | 97,741 | 109,425 |
| Changes in the consolidation perimeter | 1,203 | - | - | - | 1,203 | - |
| Benefiits and bonuses paid | (5,944) | (5,528) | (782) | (841) | (6,726) | (6,369) |
| Current service cost | 1,069 | 1,335 | 435 | 352 | 1,504 | 1,687 |
| Curtailments / settlements / constitutions (a) | (2,601) | - | 2,042 | - | (559) | - |
| Interest cost | 3,918 | 3,772 | 812 | 1,002 | 4,730 | 4,774 |
| Actuarial gains and losses (b) | (5,999) | (6,526) | (636) | (5,152) | (6,635) | (11,678) |
| Exchange differences | (109) | - | (241) | (99) | (350) | (99) |
| Defined benefit liability - 31 December | 73,181 | 81,645 | 17,726 | 16,096 | 90,907 | 97,741 |
| Value of the pension funds - 1 January | 79,300 | 81,781 | - | - | 79,300 | 81,781 |
| Changes in the consolidation perimeter | 940 | - | - | - | 940 | - |
| Transfers | (874) | - | - | - | (874) | - |
| Contributions | 3,899 | 2,019 | - | - | 3,899 | 2,019 |
| Benefits and bonuses paid | (5,952) | (5,538) | - | - | (5,952) | (5,538) |
| Expected income of the funds' assets | 3,531 | 3,667 | - | - | 3,531 | 3,667 |
| Actuarial gain in income from the funds' assets (b) | (11,036) | (2,629) | - | - | (11,036) | (2,629) |
| Value of the pension funds - 31 December | 69,807 | 79,300 | - | - | 69,807 | 79,300 |
The difference between the present value of the benefit plan liability and the market value of the funds' assets at 31 December 2008 and 2007 was as follows:
| Pension plans | Healthcare plans | Total | ||||
|---|---|---|---|---|---|---|
| 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | |
| Liability | 73,181 | 81,645 | 17,726 | 16,096 | 90,907 | 97,741 |
| Value of the pension funds | (69,807) | (79,300) | - | - | (69,807) | (79,300) |
| Deficit | 3,374 | 2,345 | 17,726 | 16,096 | 21,100 | 18,441 |
| Liability for employee benefits: | ||||||
| Current liability | 3,847 | 1,220 | 838 | 841 | 4,685 | 2,060 |
| Non-current liability | (246) | 1,773 | 16,888 | 15,255 | 16,642 | 17,028 |
| 3,601 | 2,993 | 17,726 | 16,096 | 21,327 | 19,088 | |
| Fund surplus (Note 23) | (227) | (647) | - | - | (227) | (647) |
| Total | 3,374 | 2,345 | 17,726 | 16,096 | 21,100 | 18,441 |
The main assets of the funds at 31 December 2008 and 2007 are as follows:
| 2008 | 2007 | |
|---|---|---|
| Shares | 15.8% | 21.7% |
| Fixed rate bonds | 42.4% | 38.2% |
| Variable rate bonds | 19.8% | 32.3% |
| Real estate investment funds, hedge funds, cash and insurance | 22.1% | 7.7% |
| 100.0% | 100.0% |
In the years ended 31 December 2008 and 2007 the Group incurred on costs of 1,672 thousand euros and 1,168 thousand euros, respectively, with defined contribution plans (Note 10).
A Share Purchase Plan for Employees and a Cimpor Share Purchase Option Plan were approved by the Shareholders' General Meeting held on 9 May 2008.
The Board of Directors of Cimpor – Cimentos de Portugal, SGPS, S.A. decides on who is to be a beneficiary of the Share Purchase Plan for Employees, except for members of the Board, in which case the decision is made by the Remuneration Determination Commission.
The beneficiaries have the right to purchase shares at a price equal to seventy-five percent of the closing listed price on the transaction day, up to an overall amount not exceeding half of their gross monthly remuneration.
The beneficiaries referred to above also decide on who is to be a beneficiary of the Cimpor Share Purchase Option Plan, being granted the right to purchase Cimpor shares (initial options) at a price not less than seventy-five percent of the average closing listed prices on the sixty Stock Exchange sessions immediately preceding that date. For each option exercised the beneficiary is given the option to acquire one share in each of the following three years (derived options) at the same price.
The options exercised and shares purchased in the years ended 31 December 2008 and 2007 under these incentive plans, as well as the derived options exercised under the earlier plans were as follows:
2008 2007 PLAN Nº of exercised shares Unit price Date Nº of exercised shares Unit price Date Share purchase options - derived options: - Series 2004 - - - 249,500 3.20 14 March - Series 2005 276,700 3.30 17 March 272,970 3.30 14 March - Series 2006 240,440 4.05 17 March 214,830 4.05 14 March - Series 2007 229,610 4.90 17 and 28 March - - Shares purchased options granted 264,490 4.25 27 May 238,750 4.90 25 May 1,011,240 976,050 Shares purchased by employees 157,380 4.565 13 May 128,650 5.03 17 May 1,168,620 1,104,700
The changes in this liability in the years ended 31 December 2008 and 2007 were as follows:
| 2008 | 2007 | |
|---|---|---|
| Changes in the year: | ||
| Outstanding at the beginning of the year | 1,491,250 | 1,583,050 |
| Issued during the year | 1,112,400 | 1,000,000 |
| Exercised during the year | (1,011,240) | (976,050) |
| Lapsed during the year and not exercised | (76,990) | (115,750) |
| Outstanding at the end of the year | 1,515,420 | 1,491,250 |
| Details of options issued during the year: Maturity date |
May 2008 March 2009, 2010, 2011 |
May 2007 March 2008, 2009, 2010 |
| Exercise price (euros) | 4.25 | 4.90 |
| Total value exercised (thousands of euros) | 4,728 | 4,900 |
| Cost for the year included in personnel costs | 1,091 | 1,096 |
| Details of options exercised during the year: | ||
| Average exercise price (euros) | 4.09 | 3.83 |
| Total value exercised (thousands of euros) | 4,136 | 3,739 |
The fair value of the share options granted, reflected in "Payroll costs", was calculated based on the Black-Scholes-Merton Model, and it was recognised costs of 2,003 thousand euros in 2008 (1,726 thousand euros in 2007) relating to "Equity Settled" payment plans, as follows:
| 2008 | 2007 | |
|---|---|---|
| Share purchase option plans issued during the year | 1,091 | 1,096 |
| Share purchase option plans issued in prior years | 673 | 415 |
| Shares purchased by employees | 239 | 215 |
| Cost of the exercise (Notes 10, 30 and 31) | 2,003 | 1,726 |
The following assumptions were used in the valuations as of 31 December 2008 and 2007:
| 2008 | 2007 | |
|---|---|---|
| Price per share | 6.00 | 6.88 |
| Exercise price | 4.25 | 4.90 |
| Volatility | 30.2% | 21.0% |
| Dividend yeld | 3.83% | 3.12% and 3.67% |
In the year ended 31 December 2008 and 2007, the classification between current and non-current were as follows:
| 2008 | 2007 | |
|---|---|---|
| Non-current provisions: | ||
| Provisions for tax risks | 59,842 | 102,947 |
| Environmental rehabilitation | 45,901 | 44,989 |
| Provisions for employee benefits and others personnel provisions | 23,101 | 23,277 |
| Other provisions for risks and charges | 40,172 | 36,781 |
| 169,017 | 207,993 | |
| Current provisions: | ||
| Environmental rehabilitation | 250 | 250 |
| Provisions for employee benefits and others personnel provisions | 5,637 | 3,668 |
| Other provisions for risks and charges | 938 | 1,280 |
| 6,824 | 5,199 | |
| 175,841 | 213,192 | |
The changes in the provisions in the years ended 31 December 2008 and 2007 were as follows:
| Provision for | |||||
|---|---|---|---|---|---|
| Provisions for tax risks |
Environmental rehabilitation |
employee benefits and others personnel provisions |
Other provisions for risks and charges |
Total | |
| Balances at 1 January 2007 | 99,722 | 38,327 | 33,564 | 14,245 | 185,858 |
| Changes in the consolidation perimeter | 19 | 3,405 | 3,000 | 326 | 6,750 |
| Currency translation adjustments | (831) | 1,299 | 205 | 520 | 1,192 |
| Increases | 4,062 | 2,843 | 1,911 | 14,396 | 23,213 |
| Decreases | (86) | (1) | (5,647) | (5,025) | (10,759) |
| Utilisation | (30) | (616) | (6,088) | (2,219) | (8,953) |
| Transfers | 92 | (18) | - | 15,818 | 15,891 |
| Balances at 1 January 2008 | 102,947 | 45,239 | 26,946 | 38,061 | 213,192 |
| Changes in the consolidation perimeter (Note 5) | - | 144 | 131 | 4,523 | 4,799 |
| Currency translation adjustments | 581 | (5,112) | (1,446) | (4,989) | (10,965) |
| Increases | 6,196 | 6,448 | 11,985 | 9,976 | 34,605 |
| Decreases | (49,877) | (6) | (3,929) | (3,636) | (57,448) |
| Utilisation | (5) | (577) | (5,496) | (3,137) | (9,215) |
| Transfers | - | 15 | 548 | 312 | 874 |
| Balances at 31 December 2008 | 59,842 | 46,151 | 28,738 | 41,110 | 175,841 |
The decreases in provisions for tax risks includes 49,574 thousand euros regarding the write-off of the provision that was made to cover the additional assessments of the Corporate income tax for the years of 1997 and 1998, as a result of a decision of the 1st Chamber of the Supreme Administrative Court, in the first half of 2008, which has since been confirmed by the Section's plenary, granting the appeal brought by the Company in opposition to the orders by the Secretary of State for Treasury and Finance which rejected the requests for payment of those assessments.
The provisions for Environmental rehabilitation represents the Group's legal or implicit obligation to rehabilitate land used for quarries. Payment of this liability depends on the period of operation and the beginning of the related work.
The other provisions for risks and charges cover specific business risks resulting from the Group's normal operations. In the financial year ended on 31 December 2007, these provisions were increased with an amount of 5,762 thousand euros (15 million Brasilian reais), corresponding to the contribution that the Group has agreed to make, in the event of an agreement with the Government of Economic Defence Council, as a result of the administrative charges brought by the Economic Law Department of the Ministry of Justice in Brazil for alleged economic violations in the cement and ready-mix concrete markets. The eventual signing of that agreement would not signify any admission of guilt or acknowledgement of illegal conduct.
The increases and decreases in the provisions in the years ended 31 December 2008 and 2007 were recorded by corresponding entry to the following accounts:
| 2008 | 2007 | |
|---|---|---|
| Tangible assets: | ||
| Land | 4,425 | 406 |
| Profit and loss for the year: | ||
| Supplies and services | 5 | (171) |
| Payroll | (606) | 2,449 |
| Provisions | 9,129 | 10,432 |
| Financial expenses | 5,568 | 2,409 |
| Financial income | - | (716) |
| Share of results of associates | - | 242 |
| Income tax (Note 13) | (45,786) | 4,760 |
| Shareholders' equity: | ||
| Adjustment in equity investments | - | 4 |
| Free reserves | 4,421 | (7,362) |
| (22,843) | 12,454 |
The caption financial expenses include the financial actualizations of the provision for environmental rehabilitation (Note 12).
The amounts recorded in free reserves correspond to the amount of actuarial gains and losses related to employee benefits.
Loans at 31 December 2008 and 2007 were made up as follows:
| 2008 | 2007 | |
|---|---|---|
| Non-currents liabilities: | ||
| Bonds | 883,055 | 855,939 |
| Bank loans | 1,028,075 | 467,993 |
| Other loans | - | 315 |
| 1,911,130 | 1,324,247 | |
| Currents liabilities: | ||
| Bank loans | 201,177 | 623,142 |
| Other loans | 324 | 340 |
| 201,501 | 623,481 | |
| 2,112,631 | 1,947,729 | |
Non-convertible bonds at 31 December 2008 and 2007 are made up as follows:
| Issuer | Financial instrument | Issue date |
Interest rate | Conditions / repayment |
2008 Non current |
2007 Non current |
|---|---|---|---|---|---|---|
| Cimpor Financial Operations B.V. Cimpor Financial Operations B.V. Cimpor Financial Operations B.V. |
Eurobonds US Private Placement 10Y US Private Placement 12Y |
27.May.04 27.June.03 27.June.03 |
4.50% 4.75% 4.90% |
27.May.11 27.June.13 27.June.15 |
608,107 102,762 172,186 |
597,598 96,352 161,989 |
| 883,055 | 855,939 |
The above US Private Placements are designated as fair value liabilities through profit and loss, as a result of applying the transitional provisions of IAS 39, in the year ended 31 December 2005.
The variations in fair value incorporated in the book value of the "US Private Placements" at 31 December 2008 amounted to 70,605 thousand euros (86,783 thousand euros in 31 December 2007).
Bank loans at 31 December 2008 and 2007 were made up as follows:
| Non-current | ||||
|---|---|---|---|---|
| Type | Currency | Interest rate | 2008 | 2007 |
| Bilateral | EUR | Euribor + 0.275% | 199,627 | - |
| Bilateral | EUR | Euribor + 0.550% | 299,526 | - |
| Bilateral | EUR | Euribor + 0.750% | 111,997 | - |
| Bilateral | EUR | Euribor + 0.275% | 280,000 | 280,000 |
| EIB Loan | EUR | EIB basic rate | 40,000 | 46,667 |
| Bilaterals | BRL | Several | 7,280 | 13,043 |
| Bilaterals | EUR | Several | 72,022 | 126,676 |
| Bilaterals | CVE | Several | 11 | 49 |
| Bilaterals | CNY | Several | - | 930 |
| Bilateral | INR | 10.50% | 14,838 | - |
| Bilateral | MAD | Several | 1,667 | - |
| Bilaterals | PEN | Several | 1,107 | 628 |
| 1,028,075 | 467,993 |
(Amounts stated in thousands of euros)
(Translation of notes originally issued in Portuguese – Note 50)
| Current | ||||
|---|---|---|---|---|
| Type | Currency | Interest rate | 2008 | 2007 |
| Bilateral | EUR | Euribor + 0.750% | 112,409 | - |
| EIB Loan | EUR | EIB Basic Rate | 6,667 | 6,666 |
| Bilateral | EUR | Several | 7,616 | - |
| Bilaterals | BRL | Several | 2,626 | 3,215 |
| Bilaterals | EUR | Euribor + 0.275% | - | 392,500 |
| Bilaterals | CVE | Several | 19 | - |
| Bilaterals | MAD | Several | 385 | 6,458 |
| Bilateral | ZAR | Several | - | 43 |
| Bilaterals | CNY | Several | 3,138 | 20,756 |
| Bilaterals | PEN | Several | 232 | 7,203 |
| Commercial paper | EUR | Several | 25,000 | 160,000 |
| Overdrafts | TRY | Several | 30,283 | 648 |
| Overdrafts | MAD | Several | 3,533 | - |
| Overdrafts | ZAR | Several | 73 | 667 |
| Overdrafts | EUR | Several | 8,318 | 18,875 |
| Overdrafts | CVE | Several | 878 | 611 |
| Overdrafts | MZM | Several | - | 169 |
| Other | EUR | Several | - | 5,331 |
| 201,177 | 623,142 |
The non-current portion of loans at 31 December 2008 and 2007 is repayable as follows:
| Year | 2008 | 2007 |
|---|---|---|
| 2009 | - | 74,902 |
| 2010 | 569,883 | 166,028 |
| 2011 | 839,304 | 700,263 |
| 2012 | 172,614 | 103,666 |
| 2013 and following years | 329,330 | 279,388 |
| 1,911,130 | 1,324,247 |
The loans at 31 December 2008 and 2007 are stated in the following currencies:
| 2008 | 2007 | |||
|---|---|---|---|---|
| Currency | Currency | Currency | Euros | |
| EUR | - | 1,756,268 | - | 1,618,871 |
| USD | 404,000 | 290,292 | 404,000 | 274,438 |
| MZM | - | - | 5,888 | 169 |
| BRL | 32,131 | 9,906 | 42,213 | 16,259 |
| ZAR | 952 | 73 | 7,125 | 710 |
| MAD | 62,936 | 5,586 | 73,654 | 6,458 |
| CVE | 100,109 | 908 | 72,637 | 659 |
| TRY | 65,074 | 30,283 | 1,112 | 648 |
| INR | 1,000,000 | 14,838 | - | - |
| CNY | 29,800 | 3,138 | 233,176 | 21,686 |
| PEN | 5,855 | 1,339 | 35,131 | 7,831 |
| 2,112,631 | 1,947,729 |
The foreign currency loans bear interest at market rates and were translated to euros at the rates of exchange on the balance sheet date.
The larger bilateral loans (Euribor + spread) establish that the spread must be indexed to the Standard & Poor's rating, therefore reflecting the assessment of risk of these operations.
The majority of the loan operations of the operating and sub-holding companies do not establish the need for Cimpor – Cimentos de Portugal, SGPS, S.A. to maintain majority control of the companies. However, the comfort letters requested from the holding company, for purposes of contracting the loans, usually contain a commitment for it not to sell its direct or indirect control of these companies.
The comfort letters provided by the Parent company and other subsidiary companies at 31 December 2008 and 2007 totalled 140,700 and 331,753 thousand euros, respectively.
In the larger financial operations the loan contracts also contain financial covenants for certain financial ratios to be maintained at previously agreed levels.
The financial ratios are:
At 31 December 2008 and 2007 these ratios were within the commitments established (Note 39).
The majority of the financing instruments have Negative pledge clauses. The larger loans (those exceeding 50 million euros) normally establish a maximum level of pledges over assets, which must not be exceeded without prior notice to the financial institutions.
Cross default clauses, which are current practice in loan contracts, are also present in the large majority of the referred financial instruments.
The minimum lease payments as at 31 December 2008 and 2007, resulting from finance lease liabilities, are as follows:
| 2008 | 2007 | |||
|---|---|---|---|---|
| Present value | Future value | Present value | Future value | |
| Up to 1 year | 2,102 | 2,111 | 1,946 | 1,987 |
| From 1 to 5 years | 4,670 | 4,979 | 6,305 | 6,543 |
The Cimpor Group's current operating lease contracts relate essentially to transport and office equipment.
Future commitments under the current operating lease contracts are as follows (minimum lease payments):
| Future value | ||
|---|---|---|
| 2008 | 2007 | |
| Up to 1 year | 4,959 | 4,481 |
| From 1 to 5 years | 8,997 | 6,276 |
| More than 5 years | 10 | 61 |
Total operating lease costs recognised in the consolidated statement of profit and loss for the year ended 31 December 2008 amounted to 5,085 thousand euros (4,891 thousand euros in 2007).
Under the risk management policy of the Cimpor Group, a range of derivative financial instruments have been contracted at 31 December 2008 and 2007 to hedge interest and exchange rate risk.
The Group contracts such instruments after evaluating the risks to which its assets and liabilities are exposed and assessing which instruments available in the market are the most adequate to hedge the risks.
These operations are subject to prior approval by the Executive Committee and are permanently monitored by the Financial Operations Area. Several indicators relating to the instruments are periodically determined, namely their market value and sensitivity of the projected cash flows and market value to changes in key variables, with the aim of assessing their financial effect.
The recognition of financial instruments and their classification as hedging or trading instruments, is based on the provisions of IAS 39.
Hedge accounting is applicable to financial derivative instruments that are effective as regards the elimination of variations in the fair value or cash flows of the underlying assets/liabilities. The effectiveness of such operations is verified on a regular quarterly basis. Hedge accounting covers three types of operations:
Fair value hedging instruments are financial derivative instruments that hedge exchange rate and/or interest rate risk. Changes in the fair value of such instruments are reflected in the statement of profit and loss. The underlying asset/liability is also valued at fair value as regards the part corresponding to the risk that is being hedged, the respective changes being reflected in the statement of profit and loss.
Cash flow hedging instruments are financial derivative instruments that hedge the exchange rate risk on future purchases and sales of certain assets as well as cash flows subject to interest rate risk. The effective part of the changes in fair value of the cash flow hedging instruments is recognised in shareholders' equity in the caption Reserves - Hedging operations, while the non effective part is reflected immediately in the statement of profit and loss.
Instruments hedging net investment in foreign entities are exchange rate financial derivative instruments that hedge the effect, on shareholders' equity, of the risks on translation of the financial statements of foreign entities. Changes in the fair value of these hedging operations are recorded in the shareholders' equity "Currency translation adjustments" until the hedged investment is sold or liquidated.
Instruments held for trading purposes are financial derivative instruments contracted in accordance with the Group's risk management policies but where hedge accounting is not applicable, because they were not formally designated for that purpose or because they are not effective hedging instruments in accordance with the requirements of IAS 39.
The fair value of derivative financial instruments at 31 December 2008 and 2007 is as follows:
| Other assets (Note 23) | Other liabilities (Note 41) | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Current asset | Non-current assets | Current asset | Non-current assets | ||||||
| 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | 2008 | 2007 | ||
| Fair value hedges: | |||||||||
| Exchange and interest rate swaps | - | - | 11,326 | 4,655 | - | 365 | - | 354 | |
| Interest rate swaps | 2,281 | - | 4,888 | - | - | - | - | - | |
| Exchange rate forwards | 7 | - | - | - | 110 | - | - | - | |
| Cash flow hedges: | |||||||||
| Interest rate swaps | - | - | - | - | 2,365 | 2,610 | 4,092 | 10,954 | |
| Trading: | |||||||||
| Exchange and interest rate derivatives | 219 | - | - | - | 1,447 | 6,833 | 38,542 | 86,414 | |
| Interest rate derivatives | 1,985 | 840 | 313 | - | 10,042 | 715 | 65,785 | 64,371 | |
| 4,492 | 840 | 16,527 | 4,655 | 13,964 | 10,523 | 108,419 | 162,093 |
Some derivatives, although in compliance with the Group's risk management policies as regards the management of financial market volatility risks, do not qualify for hedge accounting, and so are classified as trading instruments.
The following schedule shows the operations at 31 December 2008 and 2007 that qualify as fair value and cash flow hedging instruments:
| Type of Type of Notional Maturity Financial purpose hedge Operation Principal and interest hedge on Cross-Currency Fair value EUR 22,325,000 Oct. 2012 Intercompany Loan from C. Inversiones to Swap Natal Portland Cement Principal and interest hedge on Cross-Currency Fair value EUR 7,000,000 Oct. 2013 Intercompany Loan from C. Inversiones to Swap Natal Portland Cement Principal and interest hedge on Cross-Currency Intercompany Loan from C. Finance to Natal Fair value EUR 5,000,000 Oct. 2013 Swap Portland Cement Interest Rate Hedge of 12.5% of the interests on Fair value EUR 75,000,000 May 2011 Swap Intercompany Loan from C. Inversiones to Cimpor BV regarding the Eurobond payment Interest Rate Hedge of 12.5% of the interests on Fair value EUR 75,000,000 May 2011 Swap Intercompany Loan from C. Inversiones to Cimpor BV regarding the Eurobond payment Interest Rate Hedge of 8.33% of the interests on Fair value EUR 50,000,000 May 2011 Swap Intercompany Loan from C. Inversiones to Cimpor BV regarding the Eurobond payment Interest Rate Hedge of 8.33% of the interests on Fair value EUR 50,000,000 May 2011 Swap Intercompany Loan from C. Inversiones to |
2007 8,126 4,418 1,877 151 1,323 86 |
2008 | |||
|---|---|---|---|---|---|
| 1,226 (570) |
|||||
| 2,057 (149) |
|||||
| 1,128 | |||||
| Cimpor BV regarding the Eurobond payment | 1,355 | ||||
| Interest Rate Hedge of 8.33% of the interests on Fair value EUR 50,000,000 May 2011 Swap Intercompany Loan from C. Inversiones to Cimpor BV regarding the Eurobond payment |
1,403 | ||||
| Currency hedge Fair value USD 2,220,000 Forwards Jan. 2009 |
(103) | ||||
| Hedge of 100% of the interest on the note of Cash-Flow BRL 388,586,800 Fixed Rate Dec. 2011 Austria Republic on Cimpor Cimentos do Brasil |
(6,455) (13,564) |
11,935 (9,628)
In addition, the portfolio of derivative financial instruments at 31 December 2008 and 2007 that do not qualify as hedging instruments is made up as follows:
| Fair value | |||||
|---|---|---|---|---|---|
| Face Value | Type of Operation | Maturity | Economic purpose | 2008 | 2007 |
| USD 150,000,000 | Cross-Currency Swap | Jun. 2013 | Hedge of 100% of the principal and interest 10Y tranche of the US Private Placements |
(13,158) | (30,146) |
| USD 254,000,000 | Cross-Currency Swap | Jun. 2015 | Hedge of 100% of the principal and interest 12Y tranche of the US Private Placements |
(26,612) | (63,101) |
| EUR 100,000,000 | IRS with conditioned receivable Leg |
Dec. 2012 | IRS with options sold on Euribor 6M and US Libor 6M |
(11,485) | (13,721) |
| EUR 30,000,000 | IRS with conditioned receivable and payable Leg |
Jun. 2015 | IRS with options sold on European swap curve and options bought on the slope of the European Swap Rate. |
442 | - |
| EUR 280,000,000 | Basis Swap EUR | May 2009 | Hedge Interests Club Deal 280M | (2,881) | - |
| EUR 200,000,000 | Basis Swap EUR | Aug. 2009 | Hedge Interests Club Deal 200M | (4,746) | - |
| EUR 50,000,000 | IRS with only conditioned receivable Leg |
Dec. 2009 | IRS with options sold on US Libor 6M | (6) | (208) |
| EUR 216,723,549 | IRS with conditioned receivable Leg |
Jun. 2015 | IRS with a set of options sold on which the main | ||
| EUR 300,000,000 | IRS with only conditioned Payable Leg |
Jun. 2015 | exposure is the slope of the European swap curve. |
(54,891) | (49,048) |
| Set of symmetrical Swaps |
Set of Interest Rate Swaps | Dec. 2009 | Swaps already closed or tottaly hedged at the end of the year. The Group doesn't have anymore any economic risk in these positions. |
36 | (1,269) |
| (113,299) | (157,493) |
During its normal business activities, CIMPOR Group is exposed to a variety of financial risks likely to alter its net worth, which can be grouped, according to their nature, in the following categories:
Risk is deemed to mean the probability of obtaining a positive or negative outcome different to that expected, and which materially and unexpectedly alters the Group's net worth.
The management of the above-stated risks, which primarily arise from the unpredictability of financial markets, requires the prudent application of a set of rules and methods approved by the Executive Committee, with the end purpose of minimising their potential negative impact on the Group's performance.
All risk management, focused on that objective, is conducted according to two core concerns:
Furthtermore, another concern of the Group is that the processes for managing these risks meet internal information needs and also external requirements (regulators, auditors, financial markets and all other stakeholders).
The Group, as a rule, does not take speculative positions and so the sole aim of all operations carried out with the purpose of managing financial risks is to control existing risks to which the Group is unavoidably exposed.
Hedging the interest-rate risk and exchange-rate risk normally means contracting financial derivatives on the over-the-counter market (for reasons of flexibility), involving a limited number of counterparties with high ratings. All these operations are undertaken with financial entities with which ISDA contracts have been concluded beforehand, in accordance with international standards.
The Financial Operations Department of the holding's Corporate Centre is responsible for managing financial risks, including identifying, assessing and hedging such risks. This risk management is conducted under the guidance of the Executive Committee, in particular the director responsible for the financial risk area (whose approval is required prior to any operation).
The Group's exposure to interest-rate risk arises from the fact that its balance sheet includes financial assets and liabilities that may have been contracted at fixed interest rates or at variable interest rates. In the former case, the Group runs the risk of variation in the fair value of those assets and liabilities, whereby any change in market rates involves a (positive or negative) opportunity cost. In the latter case, such change has a direct impact on the amount of interest paid/received, resulting in cash account changes.
Interest-rate swaps are normally contracted to hedge this type of risk, in accordance with the Group's expectations concerning the development of market rates.
The interest rate market was particularly volatile in 2008, undergoing extensive rate rises to the middle of the year followed by a reversal of that trend in the second half, as the rates for the different terms declined, closing the year at levels below those of December 2007.
| December 2007 |
June 2008 |
December 2008 |
|
|---|---|---|---|
| Interest rate Euro Swap 2Y | 4.54% | 5.34% | 2.69% |
| Interest rate Euro Swap 5Y | 4.56% | 5.12% | 3.24% |
| Interest rate Euro Swap 10Y | 4.72% | 5.05% | 3.74% |
| Interest rate Euro Swap 30Y | 4.89% | 4.97% | 3.54% |
All new debt issued by the Group was contracted at a variable interest rate, untied to any swap operation, in accordance with forecasts that this downward trend in interest rates would extend into 2009. This fact, with the conversion of half the value of Eurobonds (issued at a fixed rate in 2004) to a variable rate, led to a slightly more skewed position than usual in respect of exposure to variable rate instruments – at the end of 2008, variable rate instruments accounted for close on 84% of the Group's total debt, whereas that proportion in December 2007 was only 57%.
Furthermore, contrary to the previous year, where all variable rate debt was index-linked to the 6 month Euribor rate, the Group has shifted preference, that allowed it, to the use of shorter terms (3 months and 1 month) in bank loans, as it seeks to take advantage of the referred to downward trend for interest rates in Europe.
The Group's internationalisation means that it is exposed to the exchange-rate risk for the currencies of different countries, particularly those that follow, due to the large amounts of capital invested there: Brazil, Egypt, South Africa and Turkey.
| December | December | ||
|---|---|---|---|
| Currency | 2007 | 2008 | Variation |
| 30% | |||
| 25% | |||
| 25% | |||
| 16% | |||
| TND | 1.8030 | 1.8318 | 2% |
| MZM | 34830 | 35250 | 1% |
| MAD | 11.4042 | 11.2665 | -1% |
| -5% | |||
| CNY | 10.75 | 9.4956 | -12% |
| ZAR TRY BRL INR EGP |
10.0298 1.7170 2.5963 58.03 8.1072 |
13.0667 2.1488 3.2436 67.3931 7.6857 |
The exchange effects of the translation of local financial statements in the Group's consolidated financial statements can be mitigated by hedging the net investments made in those countries. However, the Group has only done this sporadically, since it considers the cost of such operations (the difference between the local interest rates and the Group's reference currency) to generally be too high in view of the risks involved.
When the exchange-rate risk is hedged, forward contracts and standard exchange options, generally maturing in less than one year, are normally used.
The Group does not carry out exchange-rate operations that do not adequately cover existing or contracted positions.
The Group, with the exception of debt directly contracted by the different Business Areas to meet their day-to-day requirements, favours financing in the consolidation currency. Whenever financing is contracted in a currency other than the euro, it is hedged via cross currency swaps so that no exchange risk is taken on (unless this originates a situation of equilibrium with assets denominated in that other currency).
In the particular case of the US Private Placements issued in 2003, when the Group decided to use the US market to diversify its sources of financing and to benefit from the better conditions offered by that market at that time, two cross currency swaps were contracted, which converted the loans contracted in USD to loans in EUR. Both the loans contracted and the derivatives contracted are carried at their fair value, and they have a direct impact on the profit and loss account (Note 38).
The main debt instruments as at 31 December 2007 and 31 December 2008, not considering the abovementioned cross currency swaps, were denominated in the following currencies:
| December 2008 |
December 2007 |
||
|---|---|---|---|
| EUR USD |
83% 14% |
84% 13% |
|
| Other | 3% | 3% |
Considering that impact, around 97% of the loans at both dates were in euros.
Liquidity risk management means maintaining an appropriate level of cash resources and contracting credit limits that not only ensure the normal pursuit of the Group's activities but also meet the needs of any extraordinary operations.
In particular, the Group maintains committed backup lines with some banks, which can be used to meet occasional cash needs, thereby reducing the liquidity risk and also satisfying the ratios required by the rating agencies.
This risk is monitored through a cash budget, which is reviewed at regular intervals. The Group's access to short-term lines of credit of ample value and the fact that it keeps its MTN and commercial paper programmes up to date, ensure that it is equipped to act swiftly in the capital markets.
The cash surpluses of the different Business Areas are, whenever possible, channelled to the parent company through the payment of dividends or made available to other areas with a shortage of funds, through intercompany loans.
As at 31 December 2008 and 31 December 2007, credit lines obtained but not used, excluding commercial paper that has not been underwritten, rose to close to 498 million euros and 285 million euros, respectively.
The markets view of CIMPOR's credit risk in regards to financing operations is naturally reflected in the financial costs associated to such operations. The Group's influence in such matters is merely ancillary, embodying the prudent and balanced management of the business in order to lessen the probability of defaulting on its obligations.
Credit spreads have been growing since the second half of 2007, and irrespective of the issuer's level of risk:
| December 2007 |
March 2008 |
June 2008 |
September 2008 |
December 2008 |
|
|---|---|---|---|---|---|
| JP Morgan Maggie AAA | (11) | (5) | (3) | 7 | 34 |
| JP Morgan Maggie AA | 29 | 58 | 51 | 107 | 138 |
| JP Morgan Maggie A | 58 | 86 | 74 | 125 | 209 |
| JP Morgan Maggie BBB | 100 | 166 | 136 | 204 | 374 |
(Source: Bloomberg)
The area in which the CIMPOR Group operates and the difficult economic and financial climate have been chiefly responsible for the Group not escaping the downgrades that have hit practically all cement and construction materials companies. Even so, the Group maintained its Investment Grade rating, which many of its peers have lost.
The Group's high degree of solvency is reflected in its Leverage ratio (Net Debt / EBITDA) and Interest Coverage ratio (EBITDA / Net Financial Charges). The achievement of the levels pre-
established for these two indicators is fundamental in ensuring compliance not only with the two debt instruments envisaging such but also, through the performance of the cross default provisions, compliance by all the remaining debt.
Both ratios at the end of 2008 were far from the established thresholds, despite worsening during the year:
| December | December | ||
|---|---|---|---|
| Ratio | 2007 | 2008 | Limit |
| Leverage | 2.07 | 2.97 | < 3.5 |
| Interest Coverage | 9.60 | 6.89 | > 5 |
When the CIMPOR Group establishes different contractual relations with third parties, it takes on the risk of the probability of non-fulfilment or even, in an extreme scenario, default by a counterparty.
The Group endeavours to limit its exposure to this risk, when making bank deposits and other cash investments and also when contracting derivative instruments, by carefully selecting the counterparties, based on their rating and taking into account the nature, maturity and scope of the operations.
No losses due to non-fulfilment by counterparties are expected, based on the information currently to hand, and despite the decline in rating of the different counterparties with which the Group maintains relations.
The Group's policy in regard to the management of its derivatives portfolio is to diversify counterparties, though it must be acknowledged that in relation to its portfolio of interest-rate derivatives that do not qualify as hedges, there exists a single counterparty holding a dominant position, so as to facilitate operations. In any case, as this portfolio consists mainly of swaps with sold options, it is the referred institution and not the Group that actually runs the counterparty risk.
The three swaps in the component of our interest-rate derivatives portfolio classified as hedge accounting have different counterparties, following the Group's concern with not increasing commercial involvement with that institution.
The live operations of the exchange-rate swaps portfolio are divided between two different counterparties: the exchange-risk hedge swaps for the financing obtained from the US market are contracted with the bank that led the operation; whereas the cross currency swaps hedging the financial risk of loans granted to NPC (South Africa) by Cimpor Inversiones were negotiated with a local bank.
a) Interest rate
Exposure to interest-rate risk results in the variability of the Group's net financial expenses.
The results of a sensitivity analysis of exposure as at 31 December 2008 and 2007 were as follows: a parallel shift of +/- 1% in the interest rate curve, with all other assumptions remaining constant, would represent a 17 million euros and 10 million euros increase / decrease in financial expenses (before tax), for the financial years ended on 31 December 2008 and 2007 respectively.
This raised impact of a possible interest rate change on the Group's profit or loss is due to the growth of debt and also the change of the Group's debt profile, wherein variable rate instruments accounted for the larger weight of debt at the end of 2008.
The portfolio of derivatives not qualifying as hedges undergoes a further sensitivity analysis, intended to determine an indicator known as Earnings-at-Risk: a statistical measure that indicates, to a probability of 95% and for a three-month time horizon, the maximum loss that the portfolio can generate on earnings.
The assumptions used in the analysis are:
This indicator, which provides an ongoing analysis of the portfolio's risk and also assesses the extent to which these risks may be lessened by contracting certain operations, produced the following results as at 31 December 2007 and 31 December 2008:
| (Amounts in EUR) | 2008 Earnings at Risk (in mmEUR) |
2007 Earnings at Risk (in mmEUR) |
|---|---|---|
| EaR not considering diversification | 26.24 | 25.75 |
| Benefits of the diversification | 5.33 | 2.17 |
| Earnings-at-Risk | 20.91 | 23.58 |
The decline of around 2.7 million euros in Earnings-at-Risk in 2008 basically reflects the gains derived from the addition of some positions that, diversifying the portfolio, more than offset the additional risk that those new positions represented.
b) Exchange rates
In the debt and financial derivatives component, the exchange rate risks are substantially hedged by symmetrical positions and so the potential profits variability is low. The same is true for the exchange risk exposure in other financial instruments, arising from the Group's normal business activity.
As at 31 December 2008, the exposure of profits to exchange rate fluctuations mainly derives from intragroup loans between business areas operating with different currencies. A 10% change in the euro exchange rate with the currencies where such exposure is most significant, would impact on profits as follows:
| +10% | -10% | |
|---|---|---|
| EGP | 8,889 | (7,273) |
| TRY | (2,222) | 1,818 |
| CNY | (4,556) | 3,727 |
| 2,111 | (1,727) |
Accounts payable – other at 31 December 2008 and 2007 were made up as follows:
| 2008 | 2007 | |||
|---|---|---|---|---|
| Current Non-current |
Current | Non-current | ||
| Participated and participant companies | 12 | 500 | - | - |
| Other shareholders | 1,866 | 787 | 7,708 | 519 |
| Suppliers of fixed assets | 28,533 | 18,228 | 42,486 | 18,997 |
| Other creditors | 28,575 | - | 23,142 | 1,299 |
| 58,986 | 19,515 | 73,336 | 20,814 |
"Other creditors" include amounts payable to several entities on transactions not related to the Group's core operations.
These captions at 31 December 2008 and 2007 were made up as follows:
| 2008 | 2007 | |||
|---|---|---|---|---|
| Current | Non-current | Current | Non-current | |
| Accrued interest | 18,573 | - | 18,855 | - |
| Increased tax assessment | 425 | - | - | - |
| Accrued payroll | 19,856 | - | 18,339 | - |
| Derivative financial instruments (Note 38) | 13,964 | 108,419 | 10,523 | 162,093 |
| Investment subsidies | - | 6,746 | - | 7,054 |
| Other accrued costs and deferred income | 10,507 | 28 | 13,225 | - |
| 63,325 | 115,193 | 60,942 | 169,147 |
The caption "Accounts payable - trade" at 31 December 2008 and 2007 was made up as follows:
| 2008 | 2007 | |
|---|---|---|
| Trade payables | 147,036 | 145,371 |
| Suppliers - invoices for approval | 13,535 | 11,422 |
| Notes payable - trade | 30,352 | 36,297 |
| Advances from clients | 16,264 | 3,153 |
| 207,187 | 196,243 |
In transposing European Parliament and Council Directive 2003/87/CE to internal legal orders, lists of the installations of participants in the trading of emissions and the respective emission licences granted for the 2005 to 2007 period and 2008 to 2012 have been approved by the Portuguese and Spanish governments.
Eight manufacturing plants of Group companies, four in Portugal (Fábrica de Cal Hidráulica do Cabo Mondego and Alhandra, Loulé and Souselas Production Centres) and four in Spain (Oural, Toral de los Vados, Córdoba and Niebla Production Centres) received licences corresponding to emissions rights of 4,015,279 tons and 1,773,890 tons of CO2, per annum (2005 to 2007) and 4,053,897 tons and 2,025,769 tons of CO2 (2008 to 2012), respectively.
The estimated emissions of these premises were 5,510,755 tons of CO2 during the financial year ended on 31 December 2008. 360,000 tons of the total licence of 6,079,666 tons of CO2 awarded were disposed of, generating a gain of 8,188 thousand euros, reported under Other operating income (Note 8). Notwithstanding, the Group held emission licences that exceeded the referred to estimates by a reasonable margin.
Furthermore, the Group exchanged 565,423 European Emission Allowances ("EUA") licences for Certified Emission Reductions ("CER") in the the financial year ended on 31 December 2008, resulting in a gain of 3,881 thousand euros (Note 8).
Financial commitments on CO2 licences have been made at 31 December 2008, as described in Note 47.
The accounting policies in accordance with IAS 39 to financial instruments were applied to following items:
| Loans granted and accounts |
Available-for-sale financial |
Held to maturity |
Other financial |
Assets and liabilities at fair value through |
||
|---|---|---|---|---|---|---|
| 2008 | receivable | assets | investments | liabilities | profit and loss | Total |
| Assets: | ||||||
| Cash and cash equivalents | 169,564 | - | - | - | - | 169,564 |
| Accounts receivable-trade | 313,443 | - | - | - | - | 313,443 |
| Other investments | - | 8,565 | 119,801 | - | 3,029 | 131,395 |
| Other non-current accounts receivable | 10,883 | - | - | - | - | 10,883 |
| Other current accounts receivable | 29,633 | - | - | - | - | 29,633 |
| Other non-current assets | 22,235 | - | - | - | 11,639 | 33,874 |
| Other current assets | 6,644 | - | - | - | 2,211 | 8,855 |
| Current accrued income | 1,897 | - | - | - | - | 1,897 |
| Total assets | 554,298 | 8,565 | 119,801 | - | 16,879 | 699,543 |
| Liabilities: | ||||||
| Non-current loans | - | - | - | 1,636,182 | 274,948 | 1,911,130 |
| Current loans | - | - | - | 201,501 | - | 201,501 |
| Current liabilities-trade | - | - | - | 207,187 | - | 207,187 |
| Other non-current accounts payable | - | - | - | 19,515 | - | 19,515 |
| Other current accounts payable | - | - | - | 58,986 | - | 58,986 |
| Other non-current liabilities | - | - | - | 6,774 | 108,419 | 115,193 |
| Other current liabilities | - | - | - | 1,821 | 13,964 | 15,785 |
| Current acrrued costs | - | - | - | 47,539 | - | 47,539 |
| Total liabilities | - | - | - | 2,179,505 | 397,331 | 2,576,836 |
| Assets and liabilities |
||||||
| Loans granted and | Available-for-sale | Held to | Other | at fair value | ||
| accounts | financial | maturity | financial | through | ||
| 2007 | receivable | assets | investments | liabilities | profit and loss | Total |
| Assets: | ||||||
| Cash and cash equivalents | 540,250 323,861 |
- - |
- - |
- - |
- - |
540,250 323,861 |
| Accounts receivable-trade Other investments |
- | 14,644 | 149,669 | - | - | 164,314 |
| Other non-current accounts receivable | 11,880 | - | - | - | - | 11,880 |
| Other current accounts receivable | 22,800 | - | - | - | - | 22,800 |
| Other non-current assets | - | - | - | - | 4,655 | 4,655 |
| Other current assets | 3,916 | - | - | - | 840 | 4,756 |
| Current accrued income | 1,717 | - | - | - | - | 1,717 |
| Total assets | 904,425 | 14,644 | 149,669 | - | 5,495 | 1,074,234 |
| Liabilities: | ||||||
| Non-current loans | - | - | - | 1,065,906 | 258,341 | 1,324,247 |
| Current loans | - | - | - | 623,481 | - | 623,481 |
| Current liabilities-trade | - | - | - | 196,243 | - | 196,243 |
| Other non-current accounts payable | - | - | - | 20,814 | - | 20,814 |
| Other current accounts payable | - | - | - | 73,336 | - | 73,336 |
| Other non-current liabilities | - | - | - | 7,409 | 161,739 | 169,147 |
| Other current liabilities Current accrued costs |
- - |
- - |
- - |
3,971 46,813 |
10,158 - |
14,129 46,813 |
| Total liabilities | - | - | - | 2,037,973 | 430,238 | 2,468,211 |
Cash and cash equivalents at 31 December 2008 and 2007 were made up as follows:
| 2008 | 2007 |
|---|---|
| 444 392,022 |
|
| 32,848 | 147,783 |
| 169,564 | 540,250 |
| (43,085) | (20,970) |
| 126,479 | 519,280 |
| 285 136,431 |
The caption "Cash and cash equivalents" comprises cash, deposits repayable on demand, treasury applications and term deposits maturing in less than three months with insignificant risk of change in value. Bank overdrafts include amounts drawn from current accounts with financial institutions.
The most significant cash flows occurred in the year ended 31 December 2008, respects to commercial paper emission and repayment, in the amount of 284 millions of euros and 419 millions of euros, respectively, of two bilateral loans contracts amounting of 425 millions of euros and a repayment of other bilateral loan of 392.5 millions of euros, being the remaining cash flows essentially made by the use and repayment of several current credit lines.
Payments related to financial investments, occurred in the year ended 31 December 2008, corresponds essentially to the minority investment acquisition in the share capital of participated companies and to the increase of investment in associates.
Transactions and balances between Group companies consolidated by the full consolidation method or by the proportional consolidation method were eliminated in the consolidation process and so are not disclosed in this note.
The terms and conditions of the transactions between the Group companies and related parties are substantially similar to those contracted, accepted and practiced in similar operations with independent entities.
Balances and transactions between the Group and associated companies and other related parties are detailed below.
| Receivables | Payables | Transactions | |||||||
|---|---|---|---|---|---|---|---|---|---|
| Related Parties | Trade | Other debtors |
Trade | Supply of fixed assets |
Supply of fixed assets |
External supplies and services |
Inventories purchases |
Sales and services rendered |
|
| Associates | 3,407 | 20,156 | 807 | 10 | 10 | 3,670 | 1,622 | 8,299 | |
| Other related parties: | |||||||||
| Lafarge, S.A. and related | 3,997 | - | 591 | 16,059 | 366 | 1,268 | 2,186 | 37,884 | |
| Teixeira Duarte, SGPS, S.A. and related | 6,315 | 9 | - | 30 | 697 | 40 | - | 11,376 | |
| Manuel Fino, SGPS, S.A. and related | 1,364 | - | - | - | - | - | - | 1,975 | |
| 15,084 | 20,165 | 1,398 | 16,099 | 1,073 | 4,978 | 3,809 | 59,534 |
| Receivables Payables |
Transactions | |||||||
|---|---|---|---|---|---|---|---|---|
| Related Parties | Trade | Other debtors |
Trade | Supply of fixed assets |
Supply of fixed assets |
External supplies and services |
Inventories purchases |
Sales and services rendered |
| Associates | 1,623 | 83 | 213 | - | - | 2,350 | 1,266 | 7,430 |
| Other related parties: | ||||||||
| Lafarge, S.A. and related | 7,189 | 58 | 806 | 18,760 | 9 | 1,386 | 2,012 | 51,927 |
| Teixeira Duarte, SGPS, S.A. and related | 2,434 | 9 | 11 | 123 | 599 | 3 | - | 7,629 |
| Manuel Fino, SGPS, S.A. and related | 151 | - | - | - | - | - | - | 353 |
| 11,396 | 150 | 1,029 | 18,883 | 608 | 3,740 | 3,279 | 67,339 |
The caption "External supplies and services" include the costs with the Contract of Industrial and Technical Cooperation signed with Lafarge S.A., which invoices on the years ended 31 December 2008 and 2007 amounted to 1,150 thousand euros per year. This contract was signed, in 12 July 2002 and had two addendums, the last one in April 2005, and end on 31 March 2009.
Operations between related parties also include acquisitions of equity investments, namely:
In the year ended 31 December 2008, the acquisitions of share capital and other assets in Portugal and Spain from associated companies (C+PA e Arenor) totalling around 62 millions of euros (Note 5);
In the year ended 31 December 2007, the acquisition of 50% of the financial investments on turkey's business area to Group Lafarge by the amount of approximately 266.5 millions of euros and the contract signed between Cimpor - Indústria de Cimento, S.A., and C+PA - Cimento e Produtos Associados, S.A., where the second part promised to sell and first part to acquired, or nominate who acquires, the total share capital of Teporset, by the amount of 500 thousand euros.
Benefits of the members of the Company's corporate boards and executive seniors in the years ended 31 December 2008 and 2007 were as follows:
| 2008 | 2007 | |
|---|---|---|
| Board of directors | 4,944 | 4,772 |
| Senior executives | 6,958 11,902 |
6,433 11,205 |
| Short-term benefits Post employment benefits Share based payments |
10,376 252 1,274 |
9,795 275 1,135 |
| 11,902 | 11,205 |
In the normal course of its business the Group is involved in several legal processes and complaints relating to its products and services as well as of an environmental nature, labour processes and regulatory. Considering the nature of the legal processes and the provisions made up, the expected outcome is not expected to have a significant impact on the Group's operations, financial position or results of operations.
Of particular note is that tax assessments totalling approximately five million euros were made as the result of tax audits for the 2002 to 2004 financial years in Group companies headquartered in Spain, and tax audits that are still in progress have issued reports indicating potential adjustments of approximately one hundred and one million euros to the taxable income, though no assessments have yet been made in relation to such.
Those adjustments are basically focussed on the financial results and they primarily arise from interpretations that do not reflect the specific nature of certain transactions. The Board of Directors is certain that the administrative appeals and legal proceedings that the companies will file, contesting the referred adjustments, will not lead to the Group incurring significant costs. This certainty is backed up by the opinion of the Group's legal and tax consultants, considering that is remote the Group probability of losing the majority of such proceedings.
At 31 December 2008 the Group companies had guarantees totalling 126,604 thousand euros given to third parties. Of these, 28,409 thousand euros correspond to guarantees given to the tax authorities to cover additional tax assessments for the years 1990 to 2003, the liability being provided for under the caption Provisions for tax risks (Note 35).
At 31 December 2008 and 2007 the companies included in the consolidation perimeter had the following bank guarantees given to third parties:
| 2008 | 2007 | |
|---|---|---|
| Guarantees given: | ||
| For tax processes in progress | 28,409 | 28,319 |
| Bank union | 47,317 | 54,214 |
| To suppliers | 30,820 | 41,593 |
| Other | 20,058 | 14,349 |
| 126,604 | 138,475 |
Additionally, one of the contract loans, in China business area, is guaranteed by a constitution of a mortgage for fixed assets, by the amount of 5,457 thousand euros.
In the normal course of its business the Group assumes commitments related essentially to the acquisition of equipment, under its investment operations in progress and for the purchase and sale of investments, associated companies and subsidiaries.
Until 2008, the sales of the 26% of the share capital of S. C. Stone and Sterkspruit Aggregates (Note 4), in accordance with South Africa legislation regarding Black Economic Empowerment (BEE), were not recognised because the significant risks and benefits relating to those investments were not been transferred to the buyer. In accordance with the terms agreed there are no losses to be recognised as a result of the transactions.
Pursuant to the contractually established terms and conditions, to the minority shareholder of Shandong Liuyuan New-type Cement Development Co., Ltd was provided the opportunity to raise their shareholding in that company to a maximum of 40%, until 15 October 2012. The Board of Directors does not estimate any materially relevant impact on the financial statements of the Company in the event that such option is taken up.
At 31 December 2008 the Group had commitments relating to contracts to purchase tangible fixed assets and inventories as well for operating on third parties installations, totalling 54,721 thousand euros, the more significant amounts being 20,981 thousand euros relating to the Portugal business area, 15,822 thousand euros relating to the Spain business area and 12,513 thousand euros relating to the Egypt business area.
Furthermore, the Group contracted the forward swap of 405,289 greenhouse gas emission licences – European Emission Allowances ("EUA") for the same number of Certified Emission Reduction ("CER") licences, with BNP Paribas for previously agreed prices. This contract will mature in December 2009. The CER can be used to meet the commitments made under the National Emissions Licence Award Plan, nevertheless their issue is restricted to 10% of the total licences awarded.
In accordance with the Commercial Company Code ("Código das Sociedades Comerciais"), the parent company Cimpor – Cimentos de Portugal, SGPS, S.A. is jointly responsible for the obligations of its subsidiaries.
The most significant events that took place after the end of the 2008 financial year are, as follows:
Founding of the company Cimpor Zaozhuang Cement Corporation Ltd. (China), which is intended to operate the new Shanting plant;
Acquisition by Sociedade de Investimento Cimpor Macau, S.A., of the shareholding (20%) held by Chengtong Group in Cimpor Chengtong Cement Corporation, Ltd., for the amount of HKD 58 million;
The financial statements for the year ended 31 December 2008 were approved by the Board of Directors on 24 April 2009. However, they are still subject to approval by the Shareholders' General Meeting in accordance with commercial legislation in force in Portugal, set to 13 May 2009.
These consolidated financial statements are a translation of financial statements originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails.
(Translated from the Portuguese original)
| SHAREHOLDERS | No. of Shares | Share Capital % (2) |
|---|---|---|
| Teixeira Duarte, SGPS, S.A. (3) | 153,884,443 | 22.90% |
| Through members of its board of directors and audit committee | 251,000 | 0.04% |
| Through Teixeira Duarte – Engenharia e Construções, S.A., which it controls | 153,469,370 | 22.84% |
| Through members of its board of directors and audit committee | 4,495,140 | 0.67% |
| Directly | 885,140 | 0.13% |
| Through Pasim, S.A. | 1,000,000 | 0.15% |
| Through Pacim, S.A. | 2,610,000 | 0.39% |
| Through Teixeira Duarte – Sociedade Gestora de Participações e Investimentos Imobiliários, S.A., which it fully | ||
| controls | 148,974,230 | 22.17% |
| Through Tedal, SGPS, S.A., which it fully controls | 67,205,000 | 10.00% |
| Through TDCIM, SGPS, S.A., which it fully controls | 81,769,230 | 12.17% |
| Through members of the board of directors and audit committee of TDG, SGPS, S.A., in which it has a direct shareholding |
164,073 | 0.02% |
| Manuel Fino, SGPS, S.A. | 136,141,960 | 20.26% |
| On its own account | 500 | 0.00% |
| Through Limar, Limited and Jevon, Limited, which it fully controls Through Investifino – Investimentos e Participações, SGPS, S.A. (4), controled by Limar, Limited and participated by |
136,141,460 | 20.26% |
| Jevon, Limited | 136,141,460 | 20.26% |
| On its own account Through members of its board of directors and audit committee |
136,140,000 1,460 |
20.26% 0.00% |
| Lafarge, S.A. | 116,089,705 | 17.28% |
| Through Société Financiére Immobiliére et Mobiliére, SAS (Sofimo), which it controls | 116,089,705 | 17.28% |
| Through Lafarge Cementos, S.A., which it controls | 81,407,705 | 12.11% |
| Through Ladelis, SGPS, Lda., which it controls | 81,407,705 | 12.11% |
| Through Financiére Lafarge, SAS, which it controls | 34,682,000 | 5.16% |
| Banco Comercial Português, S.A. (BCP) and BCP Pension Fund | 67,474,186 | 10.04% |
| Banco Comercial Português, S.A. and entities related to it (5) | 274,186 | 0.04% |
| Banco Comercial Português, S.A. | 500 | 0.00% |
| Banco Millennium BCP Investimento, S.A. | 261,586 | 0.04% |
| Fundação Banco Comercial Português | 12,100 | 0.00% |
| Fundo de Pensões do Banco Comercial Português, S.A. | 67,200,000 | 10.00% |
| Bipadosa, S.A. | 44,912,524 | 6.68% |
| Through Metalúrgica Galaica, S.A., which it fully owns | 44,912,524 | 6.68% |
| Through Atlansider, SGPS, S.A., 50% owned by LAF 98, S.L., which it fully owns | 44,912,524 | 6.68% |
| On its own account | 44,804,844 | 6.67% |
| Through members of its board of directors and audit committee | 107,680 | 0.02% |
| Through Atlansider, SGPS, S.A., of which it owns 50% (6) | 44,912,524 | 6.68% |
| On its own account | 44,804,844 | 6.67% |
| Through members of its board of directors and audit committee | 107,680 | 0.02% |
| Mr. Lieutenant Colonel Luís Augusto da Silva | 14,049,090 | 2.09% |
| Through LSMS - Investimentos, SGPS, S.A. which he controls | 14,049,090 | 2.09% |
| Through Cinveste, SGPS, S.A., which it controls | 14,049,090 | 2.09% |
| On its own account | 13,983,000 | 2.08% |
| Through members of its board of directors and audit committee | 36,090 | 0.01% |
| Through Cinveste Finance - Gestão de Valores Mobiliários, Lda., which it controls | 30,000 | 0.00% |
(1) As per official qualifying shareholdings announcements and other information as at December 31, 2008, received by the company.
(2) With voting rights.
(3) Qualifying shareholding disclosed as officialy comunicated to the company (including shares owned by members of the board of directors and audit committee of
Teixeira Duarte – Engenharia e Construções, SGPS, S.A., and TDG, SGPS, S.A. as considered by the Portuguese Securities and Exchange Commission (CMVM)).
(4) Company fully controlled by Manuel Fino, SGPS, S.A..
(5) As foreseen in article 20 of the Portuguese Securities Code.
(6) Shares only imputed once in the calculation of the position of Metalúrgica Galaica, S.A..
As set forth in article 447º of the Portuguese Commercial Code and CMVM's (Portuguese Securities Commission) Regulation no. 5/2008, follows the 2008 CIMPOR shares trade belonging to:
| 2008 Trading | ||||||
|---|---|---|---|---|---|---|
| Shareholders | No.of Shares 31-12-07 |
No.of Shares 31-12-08 |
Acquisitions | Disposals | Price | Date |
| Ricardo Manuel Simões Bayão Horta | 104,360 | 106,550 | 2,190 | 4.565 | 13-May | |
| Luis Eduardo da Silva Barbosa | 3,440 | 380 | 4.565 | 13-May | ||
| Jacques Lefèvre | 2,940 | 3,820 | 380 | 4.565 | 13-May | |
| 3,320 | ||||||
| Jean Carlos Angulo | 3,490 | 7,080 | 1,090 2,500 |
4.565 4.250 |
13-May 27-May |
|
| Jorge Manuel Tavares Salavessa Moura | 156,780 | 40,000 40,000 40,000 |
8,590 | 3.300 4.050 4.900 5.620 |
17-Mar 17-Mar 17-Mar 26-Mar |
|
| 1,970 40,000 |
1,126 10,284 20,000 278,500 |
5.615 5.600 5.750 4.565 4.250 3.340 |
26-Mar 26-Mar 01-Apr 13-May 27-May 17-Dec |
|||
| Luís Filipe Sequeira Martins | 80,000 | 250 | ||||
| 31,000 20,000 20,000 1,860 20,000 |
3.300 4.050 4.900 4.565 4.250 |
17-Mar 17-Mar 17-Mar 13-May 27-May |
||||
| 172,860 | ||||||
| Manuel Luis Barata de Faria Blanc | 330,600 | 31,000 25,000 25,000 |
17,600 15,000 9,000 |
3.300 4.050 4.900 5.990 6.040 6.150 |
17-Mar 17-Mar 17-Mar 07-May 07-May 12-May |
|
| 396,860 | 1,860 25,000 |
4.565 4.250 |
13-May 27-May |
|||
| Pedro Maria Calainho Teixeira Duarte | 554,970 | 44,000 40,000 50,000 2,020 50,000 2,775 3,804 3,421 10,000 30,000 10,000 5,633 1,485 |
3.300 4.050 4.900 4.565 4.250 5.665 5.670 5.670 5.700 5.705 5.350 4.000 4.010 |
17-Mar 17-Mar 17-Mar 13-May 27-May 29-May 29-May 29-May 02-Jun 02-Jun 11-Jun 21-Aug 21-Aug |
||
| 860,990 | 26,322 3,506 23,054 |
4.020 4.075 4.080 |
21-Aug 22-Aug 22-Aug |
|||
| Vicente Arias Mosquera | 1,820 | 2,200 | 380 | 4.565 | 13-May | |
| José Manuel Baptista Fino | 670 | 1,050 | 380 | 4.565 | 13-May | |
| José Enrique Freire Arteta | 750 | 1,130 | 380 | 4.565 | 13-May | |
| Jaime de Macedo Santos Bastos | 26,650 | 26,650 |
| 2008 Trading | ||||||
|---|---|---|---|---|---|---|
| Shareholders | No.of Shares 31-12-07 |
No.of Shares 31-12-08 |
Acquisitions | Disposals | Price | Date |
| Alexandre Roncon Garcez de Lencastre | 44,590 | 59,480 | 2,400 4,000 3,300 990 4,200 |
3.300 4.050 4.900 4.565 4.250 |
17-Mar 17-Mar 17-Mar 13-May 27-May |
|
| Álvaro João Serra Nazaré | 9,840 | 19,870 | 1,900 2,400 2,200 1,130 2,400 |
4.900 3.300 4.050 4.565 4.250 |
17-Mar 17-Mar 17-Mar 13-May 27-May |
|
| Álvaro Nunes Gomes | 10,850 | 15,650 | 1,100 350 1,200 650 1,500 |
4.900 3.300 4.050 4.565 4.250 |
07-Mar 17-Mar 17-Mar 13-May 27-May |
|
| Angel Longarela Pena | 15,760 | 22,680 | 1,100 1,200 1,300 1,420 1,900 |
3.300 4.050 4.900 4.565 4.250 |
17-Mar 17-Mar 17-Mar 13-May 27-May |
|
| Duarte Nuno Ferreira Marques da Silva | 2,450 | 23,160 | 5,050 2,500 2,500 2,500 5,000 1,500 1,400 1,300 1,360 1,800 |
2,755 1,445 |
5.660 5.725 5.610 5.580 5.500 3.300 4.050 4.900 5.695 5.695 4.565 4.250 |
21-Feb 25-Feb 27-Feb 27-Feb 28-Feb 17-Mar 17-Mar 17-Mar 26-Mar 27-Mar 13-May 27-May |
| Eduardo Guedes Duarte | 21,770 | 25,570 | 3,800 | 4.250 | 27-May | |
| Fernando Santos Plaza | 22,900 | 34,150 | 1,900 2,100 3,900 1,050 2,300 |
4.900 4.050 3.300 4.565 4.250 |
17-Mar 17-Mar 17-Mar 13-May 27-May |
|
| João Sande e Castro Salgado | 18,020 | 21,250 | 2,700 2,300 2,000 430 2,500 |
5,700 1,000 |
3.300 4.050 4.900 5.900 4.565 4.250 4.052 |
17-Mar 17-Mar 17-Mar 17-Apr 13-May 27-May 14-Oct |
| Jorge Manuel Afonso Esteves dos Reis | 13,550 | 24,840 | 2,900 2,500 2,200 990 2,700 |
3.300 4.050 4.900 4.565 4.250 |
17-Mar 17-Mar 17-Mar 13-May 27-May |
|
| José Augusto Bras Chaves | 75,000 | 95,500 | 4,400 4,900 5,200 1,410 4,390 5,200 |
5,000 | 5.462 4.900 4.050 3.300 4.565 5.920 4.250 |
10-Mar 17-Mar 17-Mar 17-Mar 13-May 26-May 27-May |
| Pedro Manuel de Freitas Pires Marques | 11,010 | |||||
|---|---|---|---|---|---|---|
| 2,100 | 3.300 | 17-Mar | ||||
| 1,900 | 4.050 | 17-Mar | ||||
| 1,600 | 4.900 | 17-Mar | ||||
| 3,800 | 5.200 | 17-Mar | ||||
| 890 | 4.565 | 13-May | ||||
| 2,000 | 4.250 | 27-May | ||||
| 15,700 | ||||||
| Sérgio José Alves de Almeida | 15,141 | |||||
| 1,500 | 4.900 | 17-Mar | ||||
| 1,800 | 3.300 | 17-Mar | ||||
| 1,600 | 4.050 | 17-Mar | ||||
| 820 | 4.565 | 13-May | ||||
| 1,800 | 4.250 | 27-May | ||||
| 2,000 | 3.338 | 04-Dec | ||||
| 24,661 | ||||||
| Valter Garbinatto de Albuquerque | 3,230 | |||||
| 1,000 | 5.750 | 01-Abr | ||||
| 500 | 6.055 | 21-Abr | ||||
| 1,270 | 4.565 | 13-May | ||||
| 1,270 | 4.250 | 27-May | ||||
| 4,270 |
Acquisitions and Disposal of Shares
| 2008 Trading | ||||||
|---|---|---|---|---|---|---|
| Shareholders | No.of Shares 31-12-07 |
No.of Shares 31-12-08 |
Acquisitions | Disposals | Average Price |
Date |
| Teixeira Duarte Engenharia e Construções, S.A. (1) | 35,988,245 | |||||
| 35,988,245 | 6.076 | Between 18 Mar and 30 Dec (7) |
||||
| 0 | ||||||
| Pacim –SGPS, SA (2) | 0 | |||||
| 2,610,000 | 3.935 | Between 30 Jul and 09 Oct (7) |
||||
| 2,610,000 | ||||||
| Pasim – Sociedade Imobiliária, S.A. (2) | 0 | |||||
| 1,000,000 | 4.625 | Between 20 Jun and 30 Jul (7) |
||||
| 1,000,000 | ||||||
| Investifino – Investimentos e Participações, SGPS, S.A. (3) | 136,140,000 | |||||
| 136,140,000 | ||||||
| Atlansider, SGPS, S.A. (4) | 31,453,576 | |||||
| 13,350,968 | 4.890 | Between 08 Jan and 10 Oct (7) |
||||
| 44,804,844 | ||||||
| Megasa – Comércio de Produtos Siderúrgicos, Lda. (5) | 312,300 | |||||
| 0 | 31,300 | 3.200 | 10-Oct | |||
| Caxalp, SGPS, Lda. (6) | 526,000 | |||||
| 872,500 | 4.671 | Between | ||||
| 143,867 | 3.711 | 16 Jan e 17 Dec (7) | ||||
| 1,254,633 |
Shares Encumbrance and Unencumbrance:
| 2008 Trading | |||||
|---|---|---|---|---|---|
| Shareholders | No.of Shares 31-12-07 |
No.of Shares 31-12-08 |
Encumbrance | Unencumbrance | Date |
| Teixeira Duarte Engenharia e Construções, S.A. (1) | 33,042,230 | ||||
| 1,900,000 | 27-Jul | ||||
| 900,000 | 10-Oct | ||||
| 35,842,230 | 30-Dec | ||||
| 0 | |||||
| Investifino – Investimentos e Participações, S.G.P.S (3) | 136,140,000 | ||||
| 136,140,000 |
Notes:
(1) Pedro Maria Calaínho Teixeira Duarte, as member of the board of directors.
(2) Pedro Maria Calaínho Teixeira Duarte, as Chairman and controling shareholder (3) José Manuel Baptista Fino, as member of the board of directors.
(4) Ricardo Bayão Horta and José Enrique Freire Arteta, as members of the board of directors.
(5) José Enrique Freire Arteta, as manager.
(6) Jorge Manuel Tavares Salavessa Moura, as managing partner.
(7) Detailed information regarding these transactions is disclosed in annex to these report
| Date | Price | No. of Shares |
|---|---|---|
| 18-Mar | 5.600 | 4,076 |
| 18-Mar | 5.600 | 924 |
| 18-Mar | 5.600 | 771 |
| 18-Mar | 5.600 | 1,589 |
| 18-Mar | 5.600 | 140 |
| 18-Mar | 5.600 | 2,500 |
| 25-Mar | 5.600 | 120 |
| 25-Mar | 5.600 | 39 |
| 25-Mar | 5.600 | 9,841 |
| 25-Mar | 5.600 | 10,000 |
| 25-Mar | 5.600 | 10,000 |
| 25-Mar | 5.600 | 45 |
| 25-Mar | 5.600 | 30,000 |
| 25-Mar | 5.600 | 18,200 |
| 13-Jun | 5.450 | 26,270 |
| 13-Jun | 5.450 | 400 |
| 13-Jun | 5.450 | 4,582 |
| 23-Dec | 3.443 | 24,342 |
| 23-Dec | 3.443 | 629 |
| 23-Dec | 3.443 | 1,000 |
| 23-Dec | 3.443 | 539 |
| 23-Dec | 3.443 | 8 |
| 30-Dec | 6.080 | 33,042,230 |
| 30-Dec | 6.080 | 2,800,000 |
| Date | Price | No. of Shares |
|---|---|---|
| 20-Jun | 5.000 | 500,000 |
| 29-Jul | 4.250 | 630,373 |
| 30-Jul | 4.250 | 1,000,000 |
| Date | Price | No. of |
|---|---|---|
| 7-Oct | 3.999 | 1,000 |
| 7-Oct | 4.000 | 23,060 |
| 7-Oct | 4.017 | 2,132 |
| 7-Oct | 4.018 | 1,991 |
| 7-Oct | 4.019 | 600 |
| 7-Oct | 4.020 | 10,409 |
| 7-Oct | 4.002 | 24,088 |
| 7-Oct | 4.034 | 3,000 |
| 7-Oct | 4.036 | 3,000 |
| 7-Oct | 4.005 | 15,820 |
| 7-Oct | 3.960 | 3,214 |
| 7-Oct | 3.962 | 3,730 |
| 7-Oct | 3.950 | 10,790 |
| 7-Oct | 3.910 | 5,700 |
| 7-Oct | 3.940 | 17,021 |
| 7-Oct | 3.930 | 12,335 |
| 7-Oct | 3.916 | 24,000 |
| 7-Oct | 3.850 | 59,132 |
| 7-Oct | 3.849 | 11,081 |
| 7-Oct | 3.810 | 6,398 |
| 7-Oct | 3.834 | 11,779 |
| 7-Oct | 3.835 | 1,602 |
| 7-Oct | 3.830 | 221 |
| 7-Oct | 3.848 | 1,787 |
| 7-Oct | 3.840 | 8,000 |
| 7-Oct | 3.854 | 9,544 |
| 7-Oct | 3.860 | 3,436 |
| 7-Oct | 3.870 | 104 |
| 7-Oct | 3.900 | 126 |
| 7-Oct | 3.917 | 10,000 |
| 7-Oct | 3.650 | 100,000 |
| 7-Oct | 3.450 | 22,187 |
| 8-Oct | 3.450 | 166,056 |
| 8-Oct | 3.400 | 25,802 |
| 8-Oct | 3.410 | 65,000 |
| 8-Oct | 3.420 | 3,000 |
| 8-Oct | 3.430 | 25,459 |
| 8-Oct | 3.429 | 14,541 |
| 8-Oct | 3.362 | 9,400 |
| 8-Oct | 3.366 | 15,600 |
| 8-Oct | 3.360 | 3,918 |
| Date | Price | No. of Shares |
Date | Price | No. of Shares |
|---|---|---|---|---|---|
| 30-Jul | 4.120 | 500,000 | 8-Oct | 3.367 | 174 |
| 31-Jul | 4.180 | 216,000 | 8-Oct | 3.370 | 5,997 |
| 1-Aug | 4.200 | 284,000 | 8-Oct | 3.375 | 6,716 |
| 6-Aug | 4.040 | 50,000 | 8-Oct | 3.399 | 198 |
| 21-Aug | 4.040 | 450,000 | 8-Oct | 3.440 | 4,195 |
| 6-Oct | 4.039 | 700 | 8-Oct | 3.500 | 37,759 |
| 6-Oct | 4.040 | 199,300 | 8-Oct | 3.240 | 37,459 |
| 7-Oct | 3.986 | 8,900 | 9-Oct | 3.450 | 56,539 |
| 7-Oct | 3.969 | 6,000 | 9-Oct | 3.334 | 10,000 |
| Date | Price | No. of Shares |
Date | Price | No. of Shares |
Date | Price | No. of Shares |
Date | Price | No. of Shares |
Date | Price | No. of Shares |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 8-Jan | 5.990 | 25,478 | 18-Jan | 5.530 | 1,224 | 24-Jan | 5.300 | 22,500 | 30-Jan | 5.300 | 25,000 | 5-Feb | 5.590 | 5,000 |
| 8-Jan | 5.980 | 24,522 | 18-Jan | 5.540 | 21,626 | 24-Jan | 5.320 | 47,500 | 30-Jan | 5.310 | 23,000 | 5-Feb | 5.575 | 7,563 |
| 9-Jan | 5.970 | 5,000 | 18-Jan | 5.550 | 20,000 | 24-Jan | 5.280 | 23,577 | 30-Jan | 5.290 | 9,500 | 5-Feb | 5.570 | 12,437 |
| 9-Jan | 5.960 | 5,000 | 18-Jan | 5.570 | 7,150 | 24-Jan | 5.290 | 22,887 | 30-Jan | 5.260 | 30,000 | 5-Feb | 5.365 | 945 |
| 9-Jan | 5.950 | 8,109 | 18-Jan | 5.560 | 5,000 | 24-Jan | 5.270 | 1,036 | 30-Jan | 5.250 | 17,500 | 5-Feb | 5.400 | 2,000 |
| 9-Jan | 5.940 | 5,267 | 18-Jan | 5.520 | 10,000 | 24-Jan | 5.310 | 13,000 | 30-Jan | 5.270 | 14,167 | 5-Feb | 5.425 | 3,455 |
| 9-Jan | 5.930 | 40,000 | 18-Jan | 5.510 | 15,000 | 24-Jan | 5.330 | 2,000 | 30-Jan | 5.360 | 3,000 | 5-Feb | 5.410 | 1,909 |
| 9-Jan | 5.920 | 6,624 | 18-Jan | 5.470 | 5,554 | 24-Jan | 5.260 | 2,500 | 30-Jan | 5.350 | 5,000 | 5-Feb | 5.415 | 2,091 |
| 10-Jan | 5.940 | 5,000 | 21-Jan | 5.280 | 5,000 | 24-Jan | 5.250 | 5,000 | 30-Jan | 5.330 | 5,000 | 5-Feb | 5.405 | 6,000 |
| 10-Jan | 5.930 | 15,000 | 21-Jan | 5.300 | 15,000 | 24-Jan | 5.240 | 10,000 | 30-Jan | 5.320 | 3,000 | 5-Feb | 5.440 | 1,000 |
| 10-Jan | 5.900 | 10,000 | 21-Jan | 5.290 | 60,000 | 25-Jan | 5.350 | 5,000 | 30-Jan | 5.295 | 6,000 | 5-Feb | 5.420 | 600 |
| 10-Jan | 5.880 | 5,000 | 21-Jan | 5.270 | 5,000 | 25-Jan | 5.300 | 53,000 | 30-Jan | 5.235 | 10,000 | 5-Feb | 5.395 | 2,000 |
| 10-Jan | 5.830 | 5,000 | 21-Jan | 5.250 | 5,000 | 25-Jan | 5.280 | 18,500 | 30-Jan | 5.275 | 8,833 | 6-Feb | 5.360 | 9,079 |
| 10-Jan | 5.800 | 15,000 | 21-Jan | 5.410 | 12,759 | 25-Jan | 5.270 | 7,500 | 30-Jan | 5.265 | 5,000 | 6-Feb | 5.410 | 46,160 |
| 10-Jan | 5.790 | 5,000 | 21-Jan | 5.220 | 7,241 | 25-Jan | 5.290 | 17,000 | 30-Jan | 5.255 | 10,000 | 6-Feb | 5.370 | 21,705 |
| 10-Jan | 5.750 | 10,000 | 21-Jan | 5.330 | 15,000 | 25-Jan | 5.340 | 5,000 | 31-Jan | 5.300 | 36,500 | 6-Feb | 5.365 | 2,500 |
| 10-Jan | 5.760 | 4,428 | 21-Jan | 5.370 | 10,000 | 25-Jan | 5.320 | 8,000 | 31-Jan | 5.285 | 8,113 | 6-Feb | 5.350 | 11,365 |
| 10-Jan | 5.780 | 572 | 21-Jan | 5.340 | 10,000 | 25-Jan | 5.310 | 12,000 | 31-Jan | 5.290 | 5,000 | 6-Feb | 5.385 | 13,421 |
| 11-Jan | 5.670 | 5,000 | 21-Jan | 5.230 | 5,000 | 25-Jan | 5.330 | 9,000 | 31-Jan | 5.270 | 16,000 | 6-Feb | 5.375 | 10,298 |
| 11-Jan | 5.650 | 5,000 | 22-Jan | 4.750 | 2,500 | 25-Jan | 5.250 | 15,000 | 31-Jan | 5.250 | 13,000 | 6-Feb | 5.395 | 182 |
| 11-Jan | 5.600 | 10,000 | 22-Jan | 4.830 | 2,500 | 28-Jan | 5.235 | 14,822 | 31-Jan | 5.255 | 15,000 | 6-Feb | 5.390 | 12,813 |
| 11-Jan | 5.500 | 5,000 | 22-Jan | 4.810 | 1,000 | 28-Jan | 5.290 | 9,966 | 31-Jan | 5.275 | 2,500 | 6-Feb | 5.380 | 13,986 |
| 11-Jan | 5.680 | 25,000 | 22-Jan | 4.900 | 5,000 | 28-Jan | 5.265 | 15,000 | 31-Jan | 5.280 | 2,500 | 6-Feb | 5.420 | 1,886 |
| 14-Jan | 5.640 | 5,000 | 22-Jan | 5.030 | 5,503 | 28-Jan | 5.260 | 10,000 | 31-Jan | 5.320 | 12,000 | 6-Feb | 5.405 | 5,000 |
| 14-Jan | 5.660 | 5,000 | 22-Jan | 5.100 | 6,000 | 28-Jan | 5.200 | 2,500 | 31-Jan | 5.295 | 13,500 | 6-Feb | 5.355 | 1,605 |
| 14-Jan | 5.650 | 15,000 | 22-Jan | 5.260 | 13,000 | 28-Jan | 5.215 | 2,500 | 31-Jan | 5.260 | 21,927 | 7-Feb | 5.415 | 6,000 |
| 14-Jan | 5.620 | 10,000 | 22-Jan | 5.250 | 10,090 | 28-Jan | 5.230 | 6,544 | 31-Jan | 5.265 | 3,960 | 7-Feb | 5.405 | 5,000 |
| 14-Jan | 5.610 | 10,000 | 22-Jan | 5.220 | 9,500 | 28-Jan | 5.240 | 19,978 | 1-Feb | 5.340 | 5,000 | 7-Feb | 5.385 | 2,500 |
| 14-Jan | 5.600 | 5,000 | 22-Jan | 5.170 | 5,000 | 28-Jan | 5.280 | 14,052 | 1-Feb | 5.475 | 10,000 | 7-Feb | 5.380 | 13,500 |
| 15-Jan | 5.580 | 10,000 | 22-Jan | 5.290 | 10,859 | 28-Jan | 5.285 | 4,858 | 1-Feb | 5.450 | 5,000 | 7-Feb | 5.370 | 28,648 |
| 15-Jan | 5.570 | 5,000 | 22-Jan | 5.370 | 16,554 | 28-Jan | 5.275 | 10,000 | 1-Feb | 5.490 | 5,000 | 7-Feb | 5.350 | 5,000 |
| 15-Jan | 5.560 | 20,000 | 22-Jan | 5.360 | 12,494 | 28-Jan | 5.270 | 11,379 | 1-Feb | 5.505 | 5,000 | 7-Feb | 5.355 | 13,500 |
| 15-Jan | 5.540 | 5,000 | 23-Jan | 5.400 | 5,000 | 28-Jan | 5.295 | 3,401 | 1-Feb | 5.510 | 5,000 | 7-Feb | 5.375 | 12,289 |
| 15-Jan | 5.530 | 10,000 | 23-Jan | 5.350 | 10,000 | 29-Jan | 5.300 | 33,492 | 1-Feb | 5.500 | 25,119 | 7-Feb | 5.390 | 9,211 |
| 16-Jan | 5.400 | 5,000 | 23-Jan | 5.300 | 10,000 | 29-Jan | 5.295 | 20,500 | 1-Feb | 5.470 | 12,957 | 7-Feb | 5.365 | 8,500 |
| 16-Jan | 5.390 | 5,000 | 23-Jan | 5.250 | 10,750 | 29-Jan | 5.290 | 2,500 | 1-Feb | 5.530 | 14,306 | 7-Feb | 5.360 | 3,643 |
| 16-Jan | 5.370 | 25,000 | 23-Jan | 5.310 | 5,000 | 29-Jan | 5.285 | 2,500 | 1-Feb | 5.345 | 9,000 | 7-Feb | 5.430 | 11,000 |
| 16-Jan | 5.380 | 5,000 | 23-Jan | 5.200 | 19,259 | 29-Jan | 5.320 | 10,000 | 1-Feb | 5.360 | 3,000 | 7-Feb | 5.425 | 9,209 |
| 16-Jan | 5.350 | 5,000 | 23-Jan | 5.150 | 10,000 | 29-Jan | 5.330 | 5,000 | 1-Feb | 5.355 | 11,800 | 7-Feb | 5.410 | 14,000 |
| 16-Jan | 5.360 | 5,000 | 23-Jan | 5.180 | 5,000 | 29-Jan | 5.340 | 5,000 | 1-Feb | 5.350 | 7,000 | 7-Feb | 5.400 | 8,000 |
| 17-Jan | 5.440 | 58,983 | 23-Jan | 5.490 | 2,500 | 29-Jan | 5.360 | 5,000 | 1-Feb | 5.480 | 5,000 | 8-Feb | 5.445 | 10,000 |
| 17-Jan | 5.470 | 20,631 | 23-Jan | 5.420 | 2,500 | 29-Jan | 5.380 | 14,000 | 1-Feb | 5.495 | 14,081 | 8-Feb | 5.400 | 17,323 |
| 17-Jan | 5.460 | 15,660 | 23-Jan | 5.410 | 5,000 | 29-Jan | 5.315 | 3,000 | 1-Feb | 5.460 | 8,621 | 8-Feb | 5.405 | 1,050 |
| 17-Jan | 5.420 | 8,949 | 23-Jan | 5.360 | 2,500 | 29-Jan | 5.345 | 15,674 | 1-Feb | 5.485 | 7,000 | 8-Feb | 5.420 | 2,480 |
| 17-Jan | 5.430 | 16,051 | 23-Jan | 5.260 | 2,500 | 29-Jan | 5.365 | 4,349 | 4-Feb | 5.650 | 5,000 | 8-Feb | 5.410 | 26,000 |
| 17-Jan | 5.450 | 19,726 | 23-Jan | 5.330 | 14,345 | 29-Jan | 5.370 | 2,000 | 4-Feb | 5.605 | 22,500 | 8-Feb | 5.380 | 2,247 |
| 17-Jan | 5.480 | 10,000 | 23-Jan | 5.270 | 35,813 | 29-Jan | 5.375 | 11,533 | 4-Feb | 5.610 | 7,500 | 8-Feb | 5.395 | 3,784 |
| 18-Jan | 5.500 | 39,539 | 23-Jan | 5.210 | 19,362 | 29-Jan | 5.385 | 1,400 | 4-Feb | 5.615 | 5,000 | 8-Feb | 5.385 | 10,000 |
| 18-Jan | 5.490 | 14,907 | 23-Jan | 5.220 | 10,008 | 29-Jan | 5.390 | 2,544 | 4-Feb | 5.625 | 10,000 | 8-Feb | 5.450 | 37,500 |
| 18-Jan | 5.480 | 10,000 | 23-Jan | 5.190 | 463 | 29-Jan | 5.395 | 11,508 | 5-Feb | 5.585 | 5,000 | 8-Feb | 5.475 | 5,000 |
| Shares | Date | Price | Shares |
|---|---|---|---|
234 CIMPOR - CIMENTOS DE PORTUGAL, SGPS, S.A. │ GROUP
| Date | Price | No. of Shares |
Date | Price | No. of Shares |
Date | , Price | No. of Shares |
Date | Price | No. of Shares |
Date | Price | No. of Shares |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 8-Feb | 5.435 | 7,000 | 13-Feb | 5.410 | 4,767 | 3-Mar | 5.465 | 990 | 7-Mar | 5.420 | 6,933 | 13-Mar | 5.380 | 15,000 |
| 8-Feb | 5.425 | 2,000 | 13-Feb | 5.455 | 3,250 | 3-Mar | 5.495 | 10,000 | 7-Mar | 5.430 | 10,861 | 13-Mar | 5.400 | 2,000 |
| 8-Feb | 5.415 | 5,000 | 13-Feb | 5.475 | 99 | 3-Mar | 5.490 | 5,000 | 7-Mar | 5.445 | 10,000 | 13-Mar | 5.360 | 3,500 |
| 8-Feb | 5.390 | 10,616 | 13-Feb | 5.480 | 24,901 | 4-Mar | 5.500 | 54,994 | 10-Mar | 5.400 | 5,000 | 13-Mar | 5.395 | 12,000 |
| 8-Feb | 5.360 | 10,000 | 13-Feb | 5.495 | 7,626 | 4-Mar | 5.460 | 80 | 10-Mar | 5.455 | 24,681 | 13-Mar | 5.345 | 2,000 |
| 11-Feb | 5.395 | 5,000 | 13-Feb | 5.470 | 5,120 | 4-Mar | 5.495 | 12,016 | 10-Mar | 5.420 | 5,319 | 13-Mar | 5.365 | 5,000 |
| 11-Feb | 5.390 | 5,291 | 13-Feb | 5.490 | 4,278 | 4-Mar | 5.485 | 6,635 | 10-Mar | 5.430 | 3,000 | 13-Mar | 5.375 | 7,500 |
| 11-Feb | 5.400 | 13,837 | 14-Feb | 5.480 | 9,225 | 4-Mar | 5.490 | 40,000 | 10-Mar | 5.460 | 26,500 | 13-Mar | 5.390 | 10,000 |
| 11-Feb | 5.405 | 671 | 14-Feb | 5.470 | 30,455 | 4-Mar | 5.475 | 20,052 | 10-Mar | 5.470 | 18,000 | 13-Mar | 5.350 | 2,500 |
| 11-Feb | 5.385 | 5,000 | 14-Feb | 5.445 | 2,500 | 4-Mar | 5.480 | 16,223 | 10-Mar | 5.450 | 30,000 | 13-Mar | 5.330 | 8,000 |
| 11-Feb | 5.375 | 22,989 | 14-Feb | 5.450 | 19,500 | 5-Mar | 5.470 | 5,000 | 10-Mar | 5.440 | 7,500 | 14-Mar | 5.360 | 20,000 |
| 11-Feb | 5.380 | 5,000 | 14-Feb | 5.465 | 5,000 | 5-Mar | 5.500 | 65,000 | 10-Mar | 5.500 | 5,000 | 14-Mar | 5.335 | 10,000 |
| 11-Feb | 5.370 | 24,500 | 14-Feb | 5.495 | 10,000 | 5-Mar | 5.485 | 10,000 | 10-Mar | 5.410 | 5,000 | 14-Mar | 5.340 | 15,000 |
| 11-Feb | 5.345 | 1,000 | 14-Feb | 5.490 | 15,000 | 5-Mar | 5.480 | 10,000 | 10-Mar | 5.490 | 5,000 | 14-Mar | 5.330 | 12,500 |
| 11-Feb | 5.350 | 3,000 | 14-Feb | 5.500 | 27,500 | 5-Mar | 5.450 | 21,743 | 10-Mar | 5.480 | 10,000 | 14-Mar | 5.315 | 5,000 |
| 11-Feb | 5.360 | 5,349 | 14-Feb | 5.460 | 8,000 | 5-Mar | 5.430 | 5,010 | 10-Mar | 5.465 | 5,000 | 14-Mar | 5.300 | 13,644 |
| 11-Feb | 5.355 | 6,000 | 14-Feb | 5.455 | 3,320 | 5-Mar | 5.415 | 792 | 11-Mar | 5.440 | 5,000 | 14-Mar | 5.250 | 5,000 |
| 11-Feb | 5.430 | 17,000 | 14-Feb | 5.485 | 19,500 | 5-Mar | 5.420 | 5,015 | 11-Mar | 5.470 | 37,500 | 14-Mar | 5.270 | 10,000 |
| 11-Feb | 5.445 | 20,000 | 15-Feb | 5.460 | 20,000 | 5-Mar | 5.475 | 5,000 | 11-Mar | 5.475 | 37,500 | 14-Mar | 5.355 | 2,500 |
| 11-Feb | 5.435 | 5,000 | 15-Feb | 5.480 | 16,000 | 5-Mar | 5.465 | 5,000 | 11-Mar | 5.495 | 5,000 | 14-Mar | 5.370 | 15,000 |
| 11-Feb | 5.440 | 363 | 15-Feb | 5.465 | 15,000 | 5-Mar | 5.455 | 2,500 | 11-Mar | 5.455 | 5,000 | 14-Mar | 5.375 | 5,000 |
| 11-Feb | 5.425 | 10,000 | 15-Feb | 5.470 | 15,033 | 5-Mar | 5.445 | 10 | 11-Mar | 5.465 | 12,033 | 14-Mar | 5.365 | 7,500 |
| 12-Feb | 5.395 | 6,500 | 15-Feb | 5.455 | 17,967 | 5-Mar | 5.460 | 10,000 | 11-Mar | 5.460 | 2,967 | 14-Mar | 5.320 | 5,000 |
| 12-Feb | 5.375 | 4,500 | 15-Feb | 5.490 | 8,574 | 5-Mar | 5.410 | 3 | 11-Mar | 5.450 | 10,000 | 14-Mar | 5.325 | 2,500 |
| 12-Feb | 5.365 | 11,500 | 15-Feb | 5.495 | 7,362 | 5-Mar | 5.440 | 4,927 | 11-Mar | 5.500 | 20,000 | 14-Mar | 5.290 | 1,456 |
| 12-Feb | 5.355 | 17,500 | 15-Feb | 5.500 | 30,000 | 6-Mar | 5.420 | 4,091 | 11-Mar | 5.480 | 15,000 | 14-Mar | 5.275 | 7,477 |
| 12-Feb | 5.340 | 4,446 | 15-Feb | 5.475 | 15,064 | 6-Mar | 5.455 | 7,500 | 12-Mar | 5.480 | 10,000 | 14-Mar | 5.280 | 562 |
| 12-Feb | 5.325 | 3,702 | 15-Feb | 5.450 | 5,000 | 6-Mar | 5.460 | 5,000 | 12-Mar | 5.490 | 10,000 | 14-Mar | 5.285 | 3,961 |
| 12-Feb | 5.330 | 5,000 | 18-Feb | 5.500 | 26,970 | 6-Mar | 5.500 | 13,000 | 12-Mar | 5.460 | 15,000 | 14-Mar | 5.265 | 5,000 |
| 12-Feb | 5.335 | 5,000 | 18-Feb | 5.490 | 4,244 | 6-Mar | 5.470 | 23,972 | 12-Mar | 5.455 | 10,000 | 14-Mar | 5.260 | 2,900 |
| 12-Feb | 5.345 | 7,500 | 19-Feb | 5.500 | 10,000 | 6-Mar | 5.450 | 12,997 | 12-Mar | 5.475 | 15,000 | 17-Mar | 5.200 | 16,000 |
| 12-Feb | 5.410 | 2,500 | 19-Feb | 5.490 | 4,006 | 6-Mar | 5.425 | 11,022 | 12-Mar | 5.425 | 5,000 | 17-Mar | 5.100 | 5,239 |
| 12-Feb | 5.400 | 12,168 | 28-Feb | 5.500 | 116,946 | 6-Mar | 5.400 | 3,290 | 12-Mar | 5.400 | 150 | 17-Mar | 5.175 | 5,000 |
| 12-Feb | 5.405 | 5,000 | 28-Feb | 5.470 | 2,017 | 6-Mar | 5.475 | 3,000 | 12-Mar | 5.410 | 4,850 | 17-Mar | 5.140 | 15,000 |
| 12-Feb | 5.420 | 13,500 | 28-Feb | 5.485 | 15,537 | 6-Mar | 5.440 | 17,743 | 12-Mar | 5.500 | 30,000 | 17-Mar | 5.150 | 8,138 |
| 12-Feb | 5.450 | 2,000 | 28-Feb | 5.490 | 15,500 | 6-Mar | 5.465 | 12,824 | 12-Mar | 5.495 | 5,000 | 17-Mar | 5.180 | 21,237 |
| 12-Feb | 5.380 | 4,000 | 29-Feb | 5.500 | 101,103 | 6-Mar | 5.480 | 15,000 | 12-Mar | 5.485 | 10,000 | 17-Mar | 5.170 | 9,362 |
| 12-Feb | 5.360 | 18,500 | 29-Feb | 5.490 | 30,000 | 6-Mar | 5.495 | 304 | 12-Mar | 5.465 | 5,000 | 17-Mar | 5.160 | 7,500 |
| 12-Feb | 5.350 | 13,054 | 29-Feb | 5.495 | 4,282 | 6-Mar | 5.485 | 5,000 | 12-Mar | 5.445 | 5,000 | 17-Mar | 5.145 | 17,000 |
| 12-Feb | 5.370 | 8,500 | 29-Feb | 5.480 | 4,916 | 6-Mar | 5.490 | 10,000 | 12-Mar | 5.450 | 5,000 | 17-Mar | 5.230 | 2,500 |
| 12-Feb | 5.390 | 2,130 | 29-Feb | 5.485 | 6,152 | 6-Mar | 5.430 | 5,257 | 12-Mar | 5.415 | 10,000 | 17-Mar | 5.155 | 5,000 |
| 12-Feb | 5.430 | 3,000 | 3-Mar | 5.430 | 5,000 | 7-Mar | 5.415 | 975 | 12-Mar | 5.420 | 10,000 | 17-Mar | 5.190 | 6,000 |
| 13-Feb | 5.465 | 12,500 | 3-Mar | 5.440 | 5,000 | 7-Mar | 5.425 | 3,314 | 13-Mar | 5.340 | 6,500 | 17-Mar | 5.195 | 3,000 |
| 13-Feb | 5.450 | 27,000 | 3-Mar | 5.480 | 25,000 | 7-Mar | 5.440 | 15,000 | 13-Mar | 5.385 | 15,000 | 17-Mar | 5.205 | 3,474 |
| 13-Feb | 5.435 | 20,000 | 3-Mar | 5.500 | 59,296 | 7-Mar | 5.450 | 5,000 | 13-Mar | 5.370 | 5,000 | 17-Mar | 5.210 | 6,550 |
| 13-Feb | 5.430 | 9,726 | 3-Mar | 5.470 | 10,500 | 7-Mar | 5.435 | 15,191 | 13-Mar | 5.355 | 5,000 | 17-Mar | 5.215 | 2,500 |
| 13-Feb | 5.425 | 2,733 | 3-Mar | 5.485 | 5,000 | 7-Mar | 5.490 | 7,622 | 13-Mar | 5.320 | 15,000 | 17-Mar | 5.220 | 3,000 |
| 13-Feb | 5.440 | 7,500 | 3-Mar | 5.450 | 11,714 | 7-Mar | 5.495 | 11,256 | 13-Mar | 5.305 | 5,000 | 17-Mar | 5.245 | 1,000 |
| 13-Feb | 5.380 | 3,000 | 3-Mar | 5.460 | 2,500 | 7-Mar | 5.500 | 62,500 | 13-Mar | 5.315 | 5,000 | 17-Mar | 5.165 | 2,000 |
| 13-Feb | 5.400 | 10,000 | 3-Mar | 5.475 | 10,000 | 7-Mar | 5.400 | 1,348 | 13-Mar | 5.300 | 26,000 | 17-Mar | 5.135 | 5,500 |
| No. of Shares |
Date | Price | No. of |
|---|---|---|---|
| No. of Shares |
Date | Price | No. of Shares |
|---|---|---|---|
| Date | Price | No. of |
|---|---|---|
| No. of Shares |
Date | Price | No. of |
|---|---|---|---|
| Date | Price | No. of Shares |
Date | Price | No. of Shares |
|---|---|---|---|---|---|
| 17-Mar | 5.130 | 2,500 | 20-Mar | 5.400 | 10,000 |
| 17-Mar | 5.070 | 2,500 | 20-Mar | 5.385 | 5,000 |
| 18-Mar | 5.160 | 12,500 | 20-Mar | 5.495 | 4,000 |
| 18-Mar | 5.180 | 10,031 | 20-Mar | 5.500 | 10,000 |
| 18-Mar | 5.175 | 2,006 | 20-Mar | 5.570 | 5,000 |
| 18-Mar | 5.190 | 3,359 | 20-Mar | 5.270 | 4,000 |
| 18-Mar | 5.185 | 13,604 | 20-Mar | 5.415 | 21,000 |
| 18-Mar | 5.210 | 10,000 | 20-Mar | 5.460 | 15,000 |
| 18-Mar | 5.200 | 21,528 | 20-Mar | 5.390 | 5,000 |
| 18-Mar | 5.220 | 9,841 | 20-Mar | 5.380 | 2,500 |
| 18-Mar | 5.235 | 11,606 | 20-Mar | 5.450 | 5,000 |
| 18-Mar | 5.240 | 13,000 | 20-Mar | 5.490 | 10,000 |
| 18-Mar | 5.250 | 58,818 | 28-May | 5.960 | 150,000 |
| 18-Mar | 5.265 | 9,000 | 9-Jun | 5.400 | 32,000 |
| 18-Mar | 5.260 | 5,122 | 9-Jun | 5.395 | 10,000 |
| 18-Mar | 5.280 | 6,800 | 9-Jun | 5.390 | 9,000 |
| 18-Mar | 5.270 | 4,828 | 9-Jun | 5.385 | 14,000 |
| 18-Mar | 5.255 | 4,493 | 9-Jun | 5.380 | 14,000 |
| 18-Mar | 5.295 | 30,000 | 9-Jun | 5.375 | 6,000 |
| 18-Mar | 5.150 | 2,500 | 9-Jun | 5.365 | 5,000 |
| 18-Mar | 5.170 | 9,099 | 9-Jun | 5.360 | 5,000 |
| 18-Mar | 5.165 | 848 | 9-Jun | 5.370 | 5,000 |
| 18-Mar | 5.245 | 3,500 | 10-Jun | 5.400 | 9,000 |
| 18-Mar | 5.230 | 5,000 | 10-Jun | 5.385 | 5,400 |
| 18-Mar | 5.275 | 2,517 | 10-Jun | 5.390 | 23,051 |
| 19-Mar | 5.250 | 15,000 | 10-Jun | 5.395 | 1,008 |
| 19-Mar | 5.200 | 35,000 | 10-Jun | 5.380 | 30,551 |
| 19-Mar | 5.290 | 15,000 | 10-Jun | 5.375 | 15,912 |
| 19-Mar | 5.280 | 6,000 | 10-Jun | 5.370 | 4,303 |
| 19-Mar | 5.300 | 22,946 | 10-Jun | 5.365 | 2,775 |
| 19-Mar | 5.270 | 10,000 | 10-Jun | 5.360 | 1,000 |
| 19-Mar | 5.215 | 2,000 | 10-Jun | 5.355 | 1,000 |
| 19-Mar | 5.225 | 3,500 | 10-Jun | 5.350 | 6,000 |
| 19-Mar | 5.240 | 5,000 | 11-Jun | 5.360 | 38,000 |
| 19-Mar | 5.295 | 702 | 11-Jun | 5.375 | 2,000 |
| 19-Mar | 5.275 | 2,815 | 11-Jun | 5.370 | 4,926 |
| 19-Mar | 5.315 | 2,185 | 11-Jun | 5.355 | 21,448 |
| 19-Mar | 5.320 | 8,798 | 11-Jun | 5.350 | 6,000 |
| 19-Mar | 5.310 | 3,000 | 11-Jun | 5.345 | 4,445 |
| 19-Mar | 5.330 | 15,000 | 11-Jun | 5.365 | 3,181 |
| 19-Mar | 5.340 | 17,500 | 11-Jun | 5.335 | 5,000 |
| 19-Mar | 5.335 | 10,000 | 11-Jun | 5.315 | 15,000 |
| 19-Mar | 5.305 | 2,500 | 12-Jun | 5.320 | 1,000 |
| 19-Mar | 5.325 | 5,000 | 12-Jun | 5.315 | 3,000 |
| 20-Mar | 5.265 | 5,000 | 12-Jun | 5.300 | 38,000 |
| 20-Mar | 5.280 | 6,500 | 12-Jun | 5.310 | 2,000 |
| 20-Mar | 5.275 | 3,500 | 12-Jun | 5.305 | 2,000 |
| 20-Mar | 5.295 | 4,000 | 12-Jun | 5.295 | 26,000 |
| 20-Mar | 5.340 | 2,000 | 12-Jun | 5.290 | 11,000 |
| 20-Mar | |||||
| 5.470 | 10,000 | 12-Jun | 5.285 | 1,000 |
| No. of Shares |
Date | Price | No. of |
|---|---|---|---|
| No. of Shares |
Date | Price | No. of Shares |
|---|---|---|---|
| Date | Price | No. of |
|---|---|---|
| No. of Shares |
Date | Price | No. of | |
|---|---|---|---|---|
| Date Price Shares Date Price Shares 26-Jun 4.765 1,000 30-Jun 4.390 26-Jun 4.780 1,000 30-Jun 4.375 26-Jun 4.770 1,000 30-Jun 4.370 26-Jun 4.760 1,000 30-Jun 4.365 26-Jun 4.745 1,000 30-Jun 4.350 26-Jun 4.735 1,000 30-Jun 4.355 26-Jun 4.725 10,000 30-Jun 4.345 26-Jun 4.720 5,000 30-Jun 4.335 26-Jun 4.700 28,149 30-Jun 4.330 26-Jun 4.650 44,285 30-Jun 4.320 26-Jun 4.665 10,000 30-Jun 4.325 26-Jun 4.690 16,580 30-Jun 4.315 26-Jun 4.680 6,295 30-Jun 4.290 26-Jun 4.670 8,972 30-Jun 4.295 26-Jun 4.675 3,000 30-Jun 4.285 26-Jun 4.655 13,147 30-Jun 4.280 |
Date Price |
No. of Shares |
Date Price |
No. of Shares Date |
Price | No. of Shares |
|---|---|---|---|---|---|---|
| 4,000 | ||||||
| 8,866 3-Jul 4.225 |
12,500 | 9-Jul 4.480 |
5,000 | 17-Jul 4.475 |
||
| 5,134 3-Jul 4.180 |
1,700 | 9-Jul 4.495 |
5,000 | 17-Jul 4.490 |
4,000 | |
| 12,000 4-Jul 4.250 |
23,000 | 9-Jul 4.485 |
5,000 | 24-Jul 4.500 |
19,113 | |
| 5,000 4-Jul 4.200 |
5,000 | 10-Jul 4.400 |
5,000 | 25-Jul 4.340 |
1,016 | |
| 2,015 4-Jul 4.230 |
5,000 | 10-Jul 4.485 |
10 | 25-Jul 4.360 |
6,984 | |
| 1,100 4-Jul 4.260 |
84,279 | 10-Jul 4.500 |
139,559 | 25-Jul 4.385 |
5,000 | |
| 2,985 4-Jul 4.245 |
22,000 | 10-Jul 4.490 |
61,108 | 25-Jul 4.390 |
16,079 | |
| 2,000 4-Jul 4.290 |
15,000 | 10-Jul 4.495 |
35,935 | 25-Jul 4.380 |
2,921 | |
| 3,000 4-Jul 4.300 |
15,000 | 10-Jul 4.480 |
5,000 | 25-Jul 4.330 |
1,000 | |
| 6,900 4-Jul 4.285 |
15,000 | 10-Jul 4.475 |
3,388 | 25-Jul 4.370 |
5,000 | |
| 2,000 4-Jul 4.270 |
5,432 | 11-Jul 4.500 |
155,127 | 25-Jul 4.355 |
5,000 | |
| 5,000 4-Jul 4.255 |
6,876 | 11-Jul 4.490 |
10,000 | 25-Jul 4.350 |
4,000 | |
| 41,400 4-Jul 4.280 |
10,000 | 11-Jul 4.495 |
24,873 | 25-Jul 4.375 |
3,000 | |
| 24,600 4-Jul 4.265 |
28,413 | 11-Jul 4.485 |
5,000 | 25-Jul 4.425 |
1,000 | |
| 5,375 4-Jul 4.310 |
5,000 | 11-Jul 4.480 |
5,000 | 25-Jul 4.430 |
5,420 | |
| 21,000 4-Jul 4.315 |
8,222 | 11-Jul 4.470 |
5,000 | 25-Jul 4.445 |
2,173 | |
| 26-Jun 4.685 1,572 30-Jun 4.300 |
25,625 4-Jul 4.320 |
1,778 | 14-Jul 4.500 |
25,000 | 25-Jul 4.450 |
6,407 |
| 26-Jun 4.660 5,000 30-Jun 4.305 |
7,000 7-Jul 4.275 |
636 | 15-Jul 4.400 |
10,000 | 25-Jul 4.470 |
2,898 |
| 26-Jun 4.640 17,305 30-Jun 4.275 |
11,040 7-Jul 4.295 |
19,924 | 15-Jul 4.405 |
5,000 | 25-Jul 4.480 |
4,102 |
| 26-Jun 4.645 5,000 30-Jun 4.270 |
5,000 7-Jul 4.300 |
10,000 | 15-Jul 4.415 |
6,453 | 25-Jul 4.490 |
8,000 |
| 26-Jun 4.635 11,946 30-Jun 4.250 |
15,000 7-Jul 4.370 |
5,000 | 15-Jul 4.410 |
5,000 | 25-Jul 4.500 |
6,000 |
| 26-Jun 4.620 13,261 30-Jun 4.240 |
3,679 7-Jul 4.340 |
76 | 15-Jul 4.375 |
5,000 | 28-Jul 4.500 |
5,000 |
| 26-Jun 4.600 25,000 30-Jun 4.265 |
10,000 7-Jul 4.420 |
5,000 | 15-Jul 4.380 |
13,000 | 28-Jul 4.450 |
5,000 |
| 26-Jun 4.585 500 30-Jun 4.260 |
8,960 7-Jul 4.445 |
41 | 15-Jul 4.390 |
5,000 | 28-Jul 4.440 |
15,854 |
| 26-Jun 4.595 5,000 30-Jun 4.255 |
1,321 7-Jul 4.450 |
9,323 | 15-Jul 4.355 |
5,000 | 28-Jul 4.480 |
10,000 |
| 26-Jun 4.615 4,911 1-Jul 4.180 |
1,000 7-Jul 4.430 |
15,000 | 15-Jul 4.350 |
10,000 | 28-Jul 4.470 |
5,000 |
| 26-Jun 4.630 4,872 1-Jul 4.150 |
5,000 7-Jul 4.435 |
7,446 | 15-Jul 4.345 |
5,547 | 28-Jul 4.460 |
5,000 |
| 26-Jun 4.625 205 1-Jul 4.125 |
2,500 7-Jul 4.455 |
2,554 | 15-Jul 4.330 |
240 | 28-Jul 4.455 |
3,146 |
| 27-Jun 4.585 2,500 1-Jul 4.075 |
2,500 7-Jul 4.465 |
5,000 | 15-Jul 4.325 |
5,000 | 28-Jul 4.445 |
6,000 |
| 27-Jun 4.570 5,000 1-Jul 4.050 |
5,000 7-Jul 4.460 |
10,000 | 15-Jul 4.320 |
2,000 | 28-Jul 4.430 |
14,370 |
| 27-Jun 4.500 35,559 1-Jul 3.990 |
2,500 7-Jul 4.470 |
5,000 | 15-Jul 4.285 |
22,760 | 28-Jul 4.425 |
630 |
| 27-Jun 4.480 10,000 1-Jul 4.010 |
1,000 7-Jul 4.425 |
5,000 | 16-Jul 4.350 |
1,000 | 28-Jul 4.420 |
8,000 |
| 27-Jun 4.510 33,405 1-Jul 4.000 |
2,500 8-Jul 4.380 |
70,494 | 16-Jul 4.345 |
9,737 | 28-Jul 4.410 |
7,000 |
| 27-Jun 4.495 3,132 1-Jul 3.980 |
403,000 8-Jul 4.440 |
5,000 | 16-Jul 4.340 |
3,000 | 28-Jul 4.400 |
9,000 |
| 27-Jun 4.520 7,000 2-Jul 3.915 |
250 8-Jul 4.500 |
5,000 | 16-Jul 4.330 |
20,187 | 28-Jul 4.375 |
1,000 |
| 27-Jun 4.525 8,000 2-Jul 3.925 |
5,000 8-Jul 4.485 |
5,000 | 16-Jul 4.320 |
15,813 | 28-Jul 4.380 |
4,000 |
| 27-Jun 4.515 4,500 2-Jul 4.000 |
5,000 8-Jul 4.425 |
5,000 | 16-Jul 4.300 |
3,000 | 28-Jul 4.390 |
1,000 |
| 27-Jun 4.540 7,095 2-Jul 4.020 |
5,000 8-Jul 4.395 |
7,486 | 16-Jul 4.315 |
7,809 | 29-Jul 4.275 |
2,000 |
| 27-Jun 4.530 16,889 2-Jul 4.050 |
10,000 8-Jul 4.400 |
22,595 | 16-Jul 4.325 |
15,263 | 29-Jul 4.260 |
26,000 |
| 27-Jun 4.505 1,843 2-Jul 4.025 |
3,002 8-Jul 4.375 |
51,983 | 16-Jul 4.310 |
4,191 | 29-Jul 4.220 |
6,816 |
| 27-Jun 4.535 1,063 2-Jul 4.070 |
7,500 8-Jul 4.355 |
5,000 | 16-Jul 4.335 |
4,000 | 29-Jul 4.210 |
1,184 |
| 27-Jun 4.550 5,000 2-Jul 4.065 |
2,500 8-Jul 4.340 |
15,000 | 16-Jul 4.360 |
16,000 | 29-Jul 4.230 |
8,000 |
| 27-Jun 4.490 18,809 2-Jul 4.040 |
6,748 8-Jul 4.385 |
25,000 | 17-Jul 4.450 |
4,000 | 29-Jul 4.245 |
2,000 |
| 27-Jun 4.400 5,000 2-Jul 4.075 |
15,000 8-Jul 4.370 |
7,442 | 17-Jul 4.410 |
1,000 | 29-Jul 4.270 |
10,000 |
| 27-Jun 4.435 5,205 3-Jul 4.120 |
10,000 8-Jul 4.390 |
10,000 | 17-Jul 4.460 |
3,000 | 29-Jul 4.255 |
24,000 |
| 27-Jun 4.440 5,000 3-Jul 4.175 |
5,000 8-Jul 4.365 |
10,000 | 17-Jul 4.470 |
3,000 | 29-Jul 4.300 |
4,000 |
| 27-Jun 4.470 65,000 3-Jul 4.195 |
13,300 8-Jul 4.360 |
5,000 | 17-Jul 4.465 |
3,000 | 29-Jul 4.295 |
6,000 |
| 27-Jun 4.460 10,000 3-Jul 4.210 |
5,000 9-Jul 4.430 |
5,000 | 17-Jul 4.455 |
1,000 | 29-Jul 4.305 |
5,000 |
| 30-Jun 4.400 6,000 3-Jul 4.160 |
2,500 9-Jul 4.415 |
8,277 | 17-Jul 4.495 |
1,391 | 29-Jul 4.330 |
5,000 |
| 30-Jun 4.380 8,000 3-Jul 4.200 5,000 |
4.490 5,000 |
17-Jul 4.500 |
3,609 | 30-Jul 4.330 |
1,000 |
| No. of Shares |
Date | Price | No. of |
|---|---|---|---|
| No. of Shares |
Date | Price | No. of Shares |
|---|---|---|---|
| Date | Price | No. of |
|---|---|---|
| No. of Shares |
Date | Price | No. of |
|---|---|---|---|
| Date | Price | No. of Shares |
Date | Price | No. of Shares |
Date | Price | No. of Shares |
Date | Price | No. of Shares |
Date | Price | No. of Shares |
|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 30-Jul | 4.310 | 5,000 | 1-Aug | 4.215 | 4,659 | 14-Aug | 4.190 | 5,000 | 25-Aug | 4.140 | 3,972 | 1-Sep | 4.170 | 2,500 | |
| 30-Jul | 4.300 | 6,500 | 1-Aug | 4.225 | 1,629 | 14-Aug | 4.185 | 1,000 | 25-Aug | 4.120 | 2,028 | 1-Sep | 4.175 | 7,500 | |
| 30-Jul | 4.290 | 5,795 | 4-Aug | 4.170 | 10,000 | 14-Aug | 4.180 | 14,000 | 25-Aug | 4.150 | 31,423 | 1-Sep | 4.182 | 5,500 | |
| 30-Jul | 4.280 | 5,000 | 4-Aug | 4.165 | 38,019 | 14-Aug | 4.175 | 5,000 | 25-Aug | 4.145 | 15,500 | 1-Sep | 4.181 | 3,000 | |
| 30-Jul | 4.285 | 18,205 | 4-Aug | 4.160 | 23,771 | 14-Aug | 4.170 | 10,000 | 25-Aug | 4.160 | 4,000 | 1-Sep | 4.184 | 3,000 | |
| 30-Jul | 4.295 | 3,500 | 4-Aug | 4.180 | 17,812 | 15-Aug | 4.175 | 23,996 | 25-Aug | 4.165 | 2,500 | 1-Sep | 4.176 | 10,000 | |
| 30-Jul | 4.250 | 5,000 | 4-Aug | 4.155 | 284 | 15-Aug | 4.185 | 22,019 | 26-Aug | 4.135 | 2,000 | 1-Sep | 4.179 | 2,500 | |
| 30-Jul | 4.200 | 10,000 | 4-Aug | 4.175 | 114 | 15-Aug | 4.190 | 31,241 | 26-Aug | 4.130 | 2,500 | 1-Sep | 4.199 | 1,500 | |
| 30-Jul | 4.160 | 10,000 | 4-Aug | 4.195 | 10,000 | 15-Aug | 4.180 | 5,000 | 26-Aug | 4.160 | 4,000 | 1-Sep | 4.188 | 406 | |
| 30-Jul | 4.130 | 10,000 | 5-Aug | 4.165 | 96 | 15-Aug | 4.195 | 444 | 26-Aug | 4.155 | 2,194 | 5-Sep | 4.200 | 12,084 | |
| 30-Jul | 4.120 | 10,000 | 5-Aug | 4.200 | 49,904 | 15-Aug | 4.200 | 140 | 26-Aug | 4.200 | 30,000 | 10-Sep | 4.200 | 59,898 | |
| 30-Jul | 4.100 | 10,000 | 5-Aug | 4.075 | 3,682 | 18-Aug | 4.190 | 2,000 | 27-Aug | 4.170 | 11,500 | 10-Sep | 4.190 | 9,102 | |
| 31-Jul | 4.120 | 2,000 | 5-Aug | 4.080 | 6,318 | 18-Aug | 4.180 | 16,000 | 27-Aug | 4.190 | 2,500 | 10-Sep | 4.197 | 5,000 | |
| 31-Jul | 4.115 | 1,000 | 5-Aug | 4.090 | 5,000 | 18-Aug | 4.175 | 30,000 | 27-Aug | 4.180 | 5,000 | 10-Sep | 4.195 | 5,000 | |
| 31-Jul | 4.110 | 134 | 5-Aug | 4.060 | 5,000 | 18-Aug | 4.170 | 46,000 | 27-Aug | 4.175 | 6,500 | 10-Sep | 4.192 | 5,000 | |
| 31-Jul | 4.135 | 866 | 5-Aug | 4.065 | 5,000 | 18-Aug | 4.165 | 4,000 | 27-Aug | 4.165 | 22,000 | 10-Sep | 4.180 | 8,000 | |
| 31-Jul | 4.130 | 6,000 | 5-Aug | 4.050 | 10,000 | 18-Aug | 4.200 | 2,000 | 27-Aug | 4.160 | 5,000 | 10-Sep | 4.176 | 5,000 | |
| 31-Jul | 4.125 | 3,165 | 5-Aug | 4.055 | 15,000 | 19-Aug | 4.170 | 10,000 | 27-Aug | 4.150 | 12,500 | 11-Sep | 4.190 | 3,500 | |
| 31-Jul | 4.145 | 2,274 | 6-Aug | 4.100 | 10,000 | 19-Aug | 4.165 | 5,620 | 27-Aug | 4.155 | 12,500 | 11-Sep | 4.184 | 671 | |
| 31-Jul | 4.150 | 3,561 | 6-Aug | 4.075 | 20,000 | 19-Aug | 4.160 | 31,101 | 27-Aug | 4.140 | 2,500 | 11-Sep | 4.185 | 5,829 | |
| 31-Jul | 4.160 | 1,000 | 6-Aug | 4.080 | 10,000 | 19-Aug | 4.155 | 18,271 | 27-Aug | 4.135 | 7,500 | 11-Sep | 4.200 | 2,500 | |
| 31-Jul | 4.155 | 10,000 | 6-Aug | 4.065 | 15,000 | 19-Aug | 4.150 | 10,000 | 27-Aug | 4.130 | 10,500 | 11-Sep | 4.195 | 2,500 | |
| 31-Jul | 4.140 | 1,000 | 6-Aug | 4.055 | 5,000 | 19-Aug | 4.145 | 5,000 | 27-Aug | 4.125 | 19,500 | 11-Sep | 4.180 | 7,500 | |
| 31-Jul | 4.220 | 6,983 | 6-Aug | 4.060 | 4,217 | 19-Aug | 4.135 | 2,508 | 27-Aug | 4.120 | 2,500 | 11-Sep | 4.178 | 2,500 | |
| 31-Jul | 4.230 | 3,265 | 6-Aug | 4.090 | 783 | 19-Aug | 4.110 | 2,500 | 27-Aug | 4.115 | 5,000 | 11-Sep | 4.175 | 7,500 | |
| 31-Jul | 4.235 | 8,279 | 6-Aug | 4.070 | 33,980 | 19-Aug | 4.080 | 5,000 | 28-Aug | 4.045 | 2,500 | 11-Sep | 4.170 | 2,500 | |
| 31-Jul | 4.240 | 14,447 | 6-Aug | 4.040 | 1,020 | 19-Aug | 4.055 | 10,000 | 28-Aug | 4.050 | 2,500 | 11-Sep | 4.160 | 5,000 | |
| 31-Jul | 4.245 | 4,907 | 7-Aug | 4.115 | 45,095 | 20-Aug | 4.090 | 5,000 | 28-Aug | 4.040 | 2,500 | 11-Sep | 4.150 | 5,000 | |
| 31-Jul | 4.250 | 15,119 | 7-Aug | 4.120 | 24,905 | 20-Aug | 4.070 | 4,000 | 28-Aug | 4.090 | 679 | 11-Sep | 4.120 | 10,000 | |
| 31-Jul | 4.205 | 4,672 | 7-Aug | 4.130 | 6,000 | 20-Aug | 4.075 | 2,500 | 28-Aug | 4.095 | 1,821 | 11-Sep | 4.135 | 8,403 | |
| 31-Jul | 4.210 | 10,174 | 7-Aug | 4.110 | 24,000 | 20-Aug | 4.055 | 31,845 | 28-Aug | 4.125 | 35,000 | 11-Sep | 4.140 | 12,500 | |
| 31-Jul | 4.215 | 1,154 | 8-Aug | 4.140 | 24,920 | 20-Aug | 4.050 | 10,000 | 28-Aug | 4.100 | 35,025 | 11-Sep | 4.151 | 5,000 | |
| 1-Aug | 4.210 | 2,712 | 8-Aug | 4.165 | 10,500 | 20-Aug | 4.060 | 10,500 | 28-Aug | 4.105 | 10,000 | 11-Sep | 4.142 | 2,500 | |
| 1-Aug | 4.180 | 5,611 | 8-Aug | 4.145 | 9,908 | 20-Aug | 4.045 | 36,155 | 28-Aug | 4.110 | 2,975 | 11-Sep | 4.134 | 2,500 | |
| 1-Aug | 4.190 | 12,281 | 8-Aug | 4.150 | 172 | 21-Aug | 4.040 | 15,000 | 28-Aug | 4.085 | 7,000 | 11-Sep | 4.131 | 4,097 | |
| 1-Aug | 4.195 | 1,448 | 8-Aug | 4.160 | 4,500 | 21-Aug | 4.035 | 25,000 | 29-Aug | 4.110 | 1,619 | 11-Sep | 4.125 | 2,500 | |
| 1-Aug | 4.200 | 15,900 | 8-Aug | 4.135 | 5,000 | 21-Aug | 4.005 | 2,500 | 29-Aug | 4.130 | 7,000 | 11-Sep | 4.136 | 7,500 | |
| 1-Aug | 4.170 | 7,558 | 8-Aug | 4.120 | 5,000 | 21-Aug | 4.000 | 2,500 | 29-Aug | 4.175 | 1,627 | 12-Sep | 4.200 | 14,177 | |
| 1-Aug 1-Aug |
4.160 4.150 |
1,228 7,801 |
8-Aug 8-Aug |
4.125 4.100 |
10,000 10,000 |
21-Aug 21-Aug |
4.030 4.090 |
10,000 2,500 |
29-Aug 29-Aug |
4.195 4.165 |
5,000 15,000 |
10-Oct 10-Oct |
3.161 3.160 |
2,000 2,000 |
|
| 1-Aug | 4.145 | 6,199 | 8-Aug | 4.085 | 8,924 | 21-Aug | 4.095 | 2,000 | 29-Aug | 4.160 | 2,791 | 10-Oct | 3.171 | 3,274 | |
| 1-Aug | 4.140 | 1,000 | 8-Aug | 4.110 | 11,076 | 21-Aug | 4.120 | 2,500 | 29-Aug | 4.185 | 209 | 10-Oct | 3.200 | 332,374 | |
| 1-Aug | 4.130 | 1,000 | 11-Aug | 4.130 | 1,554 | 21-Aug | 4.070 | 2,500 | 29-Aug | 4.155 | 1,508 | ||||
| 1-Aug | 4.125 | 1,000 | 11-Aug | 4.140 | 10,000 | 21-Aug | 4.075 | 2,500 | 29-Aug | 4.170 | 2,622 | ||||
| 1-Aug | 4.135 | 1,000 | 11-Aug | 4.135 | 12,000 | 21-Aug | 4.045 | 33,000 | 29-Aug | 4.190 | 870 | ||||
| 1-Aug | 4.185 | 18,296 | 11-Aug | 4.180 | 6,446 | 22-Aug | 4.050 | 515 | 29-Aug | 4.200 | 5,000 | ||||
| 1-Aug | 4.175 | 578 | 11-Aug | 4.190 | 5,000 | 22-Aug | 4.085 | 13,242 | 1-Sep | 4.180 | 25,000 | ||||
| 1-Aug | 4.230 | 100 | 11-Aug | 4.200 | 2,000 | 22-Aug | 4.080 | 3,243 | 1-Sep | 4.195 | 4,500 | ||||
| 1-Aug | 4.240 | 9,864 | 14-Aug | 4.200 | 21,622 | 22-Aug | 4.095 | 5,000 | 1-Sep | 4.200 | 7,000 | ||||
| 1-Aug | 4.250 | 136 | 14-Aug | 4.195 | 43,378 | 22-Aug | 4.170 | 8,000 | 1-Sep | 4.185 | 2,500 | ||||
| No. of | |
|---|---|
| No. of Shares |
Date | Price | No. of Shares |
|---|---|---|---|
Caxalp, S.G.P.S., Lda. (Acquisitions)
| Date | Price | No. of Shares |
|---|---|---|
| 16-Jan | 5.400 | 100,000 |
| 23-Jan | 5.310 | 100,000 |
| 22-Feb | 5.700 | 30,100 |
| 25-Feb | 5.685 | 500 |
| 25-Feb | 5.695 | 6,945 |
| 25-Feb | 5.700 | 92,555 |
| 26-Feb | 5.700 | 40,312 |
| 27-Feb | 5.685 | 7,409 |
| 27-Feb | 5.690 | 18,163 |
| 27-Feb | 5.695 | 17,418 |
| 27-Feb | 5.700 | 55,598 |
| 28-Feb | 5.510 | 5,000 |
| 30-Jun | 4.300 | 10,000 |
| 30-Jun | 4.295 | 24,000 |
| 30-Jun | 4.290 | 24,000 |
| 30-Jun | 4.280 | 12,000 |
| 30-Jun | 4.270 | 31,532 |
| 30-Jun | 4.255 | 12,000 |
| 1-Jul | 4.270 | 6,468 |
| 17-Dec | 3.340 | 278,500 |
Caxalp, S.G.P.S., Lda. (Disposals)
| Date | Price | No. of Shares |
|---|---|---|
| 13-Oct | 3.731 | 8,951 |
| 13-Oct | 3.726 | 2,000 |
| 13-Oct | 3.733 | 2,651 |
| 13-Oct | 3.732 | 3,956 |
| 13-Oct | 3.730 | 1,407 |
| 13-Oct | 3.700 | 94,402 |
| 13-Oct | 3.734 | 5,000 |
| 13-Oct | 3.750 | 9,500 |
| 13-Oct | 3.749 | 8,500 |
| 13-Oct | 3.720 | 2,500 |
| 13-Oct | 3.686 | 1,422 |
| 13-Oct | 3.685 | 3,578 |
(THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY)
(Translation of a report originally issued in Portuguese)
To the Shareholders,
As required by law and the articles of association of CIMPOR – Cimentos de Portugal, SGPS, S.A. (the Company) and in accordance with our mandate, the Audit Committee hereby submits its report on activities and issues its opinion on the consolidated financial statements for 2008, which have been submitted to us for scrutiny by the Board of Directors.
The Audit Committee accompanied the activity and business of the Company and its main subsidiaries by examining accounting documents and records, reading the minutes of meetings of the Board of Directors and its Executive Committee and viewing and analysing other documents in order to assess compliance with the law and articles of association. The Audit Committee also performed tests and other validation and checking procedures in as much detail as it saw fit.
As part of its work, the Audit Committee remained in regular contact with the Executive Committee of the Board of Directors, as well as with the Company's various departments, especially the Internal Audit Department. It analysed the activity of this Department and the improvement implemented, obtaining all necessary information and clarifications.
As required by the articles of association, the Audit Committee held monthly meetings, along with other occasional meetings whenever the circumstances imposed. These meetings were in addition to the work carried out by each one of the Committee's members as regards the analysis of the documents provided and the monitoring of the work of the Company and its subsidiaries concerning its financial situation and the progress of operations by geographical region and business area, comparing the management forecasting instruments to the performance achieved. It also sustained elucidative dialogue with the Statutory Auditor, which also acted in the role of External Auditor.
The Audit Committee also accompanied the preparation of the consolidated financial statements and checked the consolidation perimeter.
We examined the reports and opinions of the supervisory bodies of the companies located in Portugal falling within the consolidation perimeter, as required by law and the articles of association. For the companies based abroad, we examined the reports of their auditors describing how such audits were conducted and their conclusions.
In its Annual Report, the Board of Directors describes the Cimpor Group's operations in 2008 and, in addition to this information, relates the most important recent events and highlights those constituting the company's main milestones last year.
Despite the fact that the Cimpor Group's Consolidated Turnover and the number of physical units sold were the highest ever, the Group's Operating Income fell 10.4% and Net Profits shrunk 27.8%, reflecting the inescapable economic and financial crisis profoundly affecting the world.
However, the Operating Cash Flow, it should be noted, only registered a decline of 3.4%, primarily due to the development of Cimpor's expansionist strategy and its balanced and growing internationalization, with important growth in Brazil, Egypt and Mozambique and also now with a very promising market footing in China, India and also South Africa, though, in this latter case, the position is partially countered by currency devaluation. The increase of EBITDA obtained in those countries enabled Cimpor to attenuate the slump in the Portuguese and particularly the Spanish markets. Turkey also fell short of achieving the expected results, for the reasons developed in detail in the Annual Report. The charts showing the business broken down by geographical segment clearly show these developments.
The Group's expansion, particularly its start up in India and the Canary Islands and important investment undertaken in Morocco, Turkey and China, forced a rise in Net Financial Debt, which was carefully managed in order to curb the increase to the respective costs, despite the heavy increase in the Euribor rates. Nonetheless, the narrowing of the differential between the published ratios and contractual finance limits, in the prevailing international economic environment, led Standard & Poor's to, at the start of the year, lower CIMPOR's rating, though still maintaining adequate solidity.
The Group's market capitalisation suffered the effects of enormous global financial instability during 2008, replicated through large-scale economic contraction - this being a situation that remains a source of great concern and it suggests a scenario of prolonged worldwide recession. Market capitalisation for the year as a whole fell 42%.
Naturally, the Board of Director's outlook for 2009 cannot be optimistic, for the reasons referred to. The investment effort undertaken in 2008 and continuing into 2009 will allow the Group to surpass, even without further acquisitions, a cement production capacity of 36 million tons/year. Nevertheless, the difficulties existing in practically the entire world economy lead Cimpor to coherently expect an income in the region of that achieved in 2007.
We would like to mention the ongoing improvement in the company's organisation, its growing rationalisation by geographical area and its pursuit of an active and ever more appropriate policy of sustainable development. The Cimpor Group continues to be characterised by harmonious corporate growth in a correct understanding of the true meaning of "globalisation".
Finally, we highlight the focus given to the chapter on Corporate Governance in the Annual Report.
As part of its duties, the Audit Committee analysed the consolidated financial statements, which consist of the consolidated balance sheet as at 31 December 2008, the consolidated profit and loss account, the consolidated statement of recognised income and expense, the consolidated cash flow statement and their respective notes, as prepared by the Board of Directors. In our analysis, we noted that the accounting standards used in their preparation were in compliance with the International Financial Reporting Standards as adopted by the European Union, in addition to complying with law and the articles of association.
The Audit Committee has viewed the Statutory Audit Certificate and Audit Report on the consolidated accounts issued by the statutory auditor and it agrees to said documents, which do not express any reservations or emphasis.
In the performance of our duties, we did not detect any aspects violating the law or the articles of association or significantly affecting a true, appropriate picture of the financial situation of the profits and cash flows of the companies included in the consolidation.
The Audit Committee wishes to thank the Board of Directors in general and its Executive Committee in particular, the different heads of department and other Company personnel with whom it has had the opportunity to come into contact.
In view of the above, the Audit Committee issues the following:
The Consolidated Annual Report, the consolidated balance sheet, consolidated profit and loss accounts, by nature and function, the consolidated cash flow statement and their Page 4 of 4 4
respective notes for the financial year of 2008 are in accordance with the applicable accounting standards and requirements of the law and articles of association and can therefore be approved at the General Meeting of Shareholders.
Lisbon, 27 April 2009
Luís Black Freire d'Andrade Member
Jaime de Macedo Santos Bastos Member
(Translated from the Portuguese Original)
(pursuant to Article 245 no. 1 c) of the Portuguese Securities' Code)
As far as we aware: the information set forth in Article 245 no. 1) c) of the Portuguese Securities' Code was drawn up in conformity with applicable accounting standards, providing an accurate and appropriate image of the assets and liabilities, the financial situation and the profits of CIMPOR – Cimentos de Portugal, SGPS, S.A. and the companies included in the consolidation perimeter (CIMPOR Group); the report of the directors faithfully provides an account of the evolution of the business, the performance and the position of the CIMPOR Group and it contains a description of the main risks and uncertainties that face it.
Lisbon, 27 April 2009
Ricardo José Minotti da Cruz Filipe
(Chairman)
Luís Black Freire d'Andrade
(Member)
Jaime de Macedo Santos Bastos
(Member)
(THIS PAGE HAS BEEN LEFT BLANK INTENTIONALLY)
(Translation of a report originally issued in Portuguese)
Page 2 of 2
Lisbon, 24 April 2009
______________________________________ DELOITTE & ASSOCIADOS, SROC S.A. Represented by João Luís Falua Costa da Silva
The Directors' Report on the consolidated operations of CIMPOR – Cimentos de Portugal, SGPS, S.A., covers all aspects related to both the Governance of the Company and the development of the different business activities of the Group's companies. Shareholders are therefore advised to read this report for further information on these matters.
The Company's Turnover in individual terms is derived exclusively from providing management services to the Group companies. In 2008 this turnover was approximately 4.6 million euros (6% down from the previous year). Operating expenses before amortization and provisions also fell slightly to around EUR 12.2 million.
Gains in group companies and associates (reported through the equity method) are, given the nature of the Company's business operations, its main source of earnings. These gains were EUR 111.8 million in value in 2008 (55% down on the previous year).
That decline in gains was primarily responsible for the close on 39% fall in net profit in 2008, to around EUR 154 million.
The following information is provided in compliance with current legal requirements:
| Date | No. Shares | Price (EUR) | Note | |
|---|---|---|---|---|
| 17 March | 276,700 | 3.300 | (1) | |
| 17 March | 240,440 | 4.050 | (1) | |
| 17 March | 229,360 | 4.900 | (1) | |
| 28 March | 250 | 4.900 | (1) | |
| 13 May | 157,380 | 4.565 | (2) | |
| 27 May | 264,490 | 4.250 | (3) |
(1) Options Award Plans (2005, 2006 and 2007)
(2) Share Acquisition Plan (2008)
(3) Options Award Plan (2008)
A total of 5,643,243 shares were acquired during 2008 at an average unit price of 4.503 euros. These shares are intended to secure the ongoing nature of the Group's incentive policy and to meet commitments under the referred to stock purchase and option plans (see Annex II of the Corporate Governance Report). As a result, the number of own shares held in portfolio at the end of 2008 was 8,476,832, equivalent to 1.26% of the Company's share capital.
• No other business between the Company and its directors occurred in 2008, besides the disposal of own shares under the stock purchase and stock option plans referred to in sections II.4.2 and III.5 of the Corporate Governance Report.
No events of special significance took place after the end of 2008, other than those already described in the Directors' Report on the consolidated operations of the CIMPOR Group.
The probable development of cement consumption in some of the different markets where the Group operates, combined with the decline in fuel costs and rise in production capacity that will occur over the year in the China, Brazil and Turkey Business Areas, allow us to tackle 2009 with some optimism, despite the international economic crisis. Especially when compared to the 2008 financial year, in which non-recurring losses heavily impacted on profits.
As reflected in the Financial Statements, the net profit for 2008 amounted to EUR 153,978,720.99 in individual terms.
In accordance with the parameters defined in the Memorandum and Articles of Association and the Company's dividend distribution policy set forth in the Corporate Governance Report, it is proposed that net profits are appropriated as follows:
Lisbon, 24 April 2009
Ricardo Manuel Simões Bayão Horta
Luís Eduardo da Silva Barbosa Jacques Lefèvre
Jean Carlos Ângulo Jorge Manuel Tavares Salavessa Moura
Luís Filipe Sequeira Martins Manuel Luís Barata de Faria Blanc
Pedro Maria Calaínho Teixeira Duarte Vicente Árias Mosquera
José Manuel Baptista Fino José Enrique Freire Arteta
| Notes | 2008 | 2007 | |
|---|---|---|---|
| Non-current assets: | |||
| Investments, net | 5 | 1,097,041 | 1,407,219 |
| Fixed assets, net | 6 | 6,331 | 6,487 |
| Intangible assets, net | 540 | 720 | |
| Other non-current assets, net | 4 | 2 | 7 |
| Deferred tax | 12 | 292 | 304 |
| Total non-current assets | 1,104,206 | 1,414,735 | |
| Current assets: | |||
| Cash and cash equivalents | 616 | 857 | |
| Accounts receivable-trade, net | 3 | 24 | 24 |
| Accounts receivable-other, net | 3 | 12,939 | 23,829 |
| Prepaid expenses and other current assets | 9 | 325 | 500 |
| Total current assets | 13,903 | 25,209 | |
| Total assets | 1,118,109 | 1,439,944 | |
| Non-current liabilities: | |||
| Deferred tax | 12 | 274 | 287 |
| Total non-current liabilities | 274 | 287 | |
| Current liabilities: | |||
| Loans | - | 5,000 | |
| Accounts payable-trade | 7 | 749 | 692 |
| Accounts payable-other | 7 | 545 | 327 |
| Accrued expenses | 8 | 1,166 | 1,309 |
| Taxes payable | 10 | 2,003 | 3,522 |
| Provision for other risks and charges | 11 | 48,584 | 91,961 |
| Total current liabilities | 53,046 | 102,811 | |
| Total liabilities | 53,320 | 103,098 | |
| Shareholders' equity: | |||
| Share capital | 15 | 672,000 | 672,000 |
| Treasury shares | 15 | (41,640) | (19,927) |
| Revaluation reserve | 15 | 1,769 | 1,811 |
| Legal reserve | 15 | 119,465 | 106,900 |
| Adjustment in equity investments, other reserves and retained earnings | 15 | 159,215 | 324,777 |
| Net profit for the year | 15 | 153,979 | 251,284 |
| Total shareholders' equity | 1,064,788 | 1,336,845 | |
| Total liabilities and shareholders' equity | 1,118,109 | 1,439,944 |
The accompanying notes form an integral part of the financial statements for the year ended 31 December 2008.
Ricardo Manuel Simões Bayão Horta
Luís Eduardo da Silva Barbosa Jacques Lefèvre
Luís Filipe Sequeira Martins Manuel Luís Barata de Faria Blanc
Pedro Maria Calaínho Teixeira Duarte Vicente Arias Mosquera
José Manuel Baptista Fino José Enrique Freire Arteta
Jean Carlos Angulo Jorge Manuel Tavares Salavessa Moura
| Notes | 2008 | 2007 | |
|---|---|---|---|
| Operating income: | |||
| Sales and services rendered | 13 and 16 | 4,600 | 4,894 |
| Other operating income | 13 | 665 | 1,330 |
| Reversal of amortisations and adjustments | 14 | 48 | 298 |
| Total operating income | 5,314 | 6,522 | |
| Operating expenses: | |||
| Outside supplies and services | (4,150) | (4,413) | |
| Payroll costs | 17 | (7,986) | (7,828) |
| Depreciation and amortisation | (441) | (418) | |
| Provisions | 11 | (2,408) | (1,700) |
| Other operating expenses | (84) | (81) | |
| Total operating expenses | (15,069) | (14,440) | |
| Operating loss | (9,755) | (7,918) | |
| Financial income, net | 18 | 112,471 | 251,386 |
| Extraordinary items, net | 20 | (104) | 3,888 |
| Income before income tax | 102,612 | 247,356 | |
| Income tax | 12 | 51,366 | 3,928 |
| Net profit for the year | 153,979 | 251,284 |
The accompanying notes form an integral part of the financial statements for the year ended 31 December 2008.
Ricardo Manuel Simões Bayão Horta
Luís Eduardo da Silva Barbosa Jacques Lefèvre
Pedro Maria Calaínho Teixeira Duarte Vicente Arias Mosquera
Jean Carlos Angulo Jorge Manuel Tavares Salavessa Moura
Luís Filipe Sequeira Martins Manuel Luís Barata de Faria Blanc
| Share capital |
Treasury shares |
Revaluation reserve |
Legal reserve |
Adjustment in equity investments |
Other reserves and retained earnings |
Net income for the period |
Total | |
|---|---|---|---|---|---|---|---|---|
| Balances at 31 December 2006 | 672,000 | (9,295) | 1,853 | 95,200 | 210,914 | (3,834) | 233,171 | 1,200,010 |
| Earnings allocated to reserves | - | - | - | 11,700 | - | 73,991 | (85,691) | - |
| Dividends | - | - | - | - | - | 529 | (144,480) | (143,951) |
| Distribution of profits to employees | - | - | - | - | - | - | (3,000) | (3,000) |
| Purchase/(sale) of treasury shares | - | (10,632) | - | - | - | 476 | - | (10,156) |
| Adjustments in equity investments | - | - | - | - | 42,658 | - | - | 42,658 |
| Other adjustments | - | - | (42) | - | 56,569 | (56,527) | - | - |
| Net profit for the year | - | - | - | - | - | - | 251,284 | 251,284 |
| Balances at 31 December 2007 | 672,000 | (19,927) | 1,811 | 106,900 | 310,142 | 14,635 | 251,284 | 1,336,845 |
| Earnings allocated to reserves (Note 15) | - | - | - | 12,565 | - | 81,159 | (93,724) | - |
| Dividends (Note 15) | - | - | - | - | - | 1,325 | (154,560) | (153,235) |
| Distribution of profits to employees (Note 15) | - | - | - | - | - | - | (3,000) | (3,000) |
| Purchase/(sale) of treasury shares (Notes 15 and 22) | - | (21,713) | - | - | - | 722 | - | (20,991) |
| Adjustments in equity investments (Note 5) | - | - | - | - | (248,809) | - | - | (248,809) |
| Other adjustments | - | - | (42) | - | 86,622 | (86,580) | - | - |
| Net profit for the year | - | - | - | - | - | - | 153,979 | 153,979 |
| Balances at 31 December 2008 | 672,000 | (41,640) | 1,769 | 119,465 | 147,955 | 11,261 | 153,979 | 1,064,788 |
The accompanying notes form an integral part of the financial statements for the year ended 31 December 2008.
Ricardo Manuel Simões Bayão Horta
Luís Eduardo da Silva Barbosa Jacques Lefèvre
Jean Carlos Angulo Jorge Manuel Tavares Salavessa Moura
Pedro Maria Calaínho Teixeira Duarte Vicente Arias Mosquera
José Manuel Baptista Fino José Enrique Freire Arteta
Luís Filipe Sequeira Martins Manuel Luís Barata de Faria Blanc
| Notes | 2008 | 2007 | |
|---|---|---|---|
| Operating activities: | |||
| Receipts from clients | 69 | 117 | |
| Payments to suppliers | (4,456) | (4,631) | |
| Payments to employees | (9,751) | (10,505) | |
| Cash flow generated by operations | (14,139) | (15,020) | |
| Income tax recovered / (paid) | 6,339 | 6,475 | |
| Other receipts relating to operating activities | 5,461 | 7,215 | |
| Cash flow before extraordinary items | (2,338) | (1,330) | |
| Receipts relating to extraordinary items | 2 | - | |
| Payments relating to extraordinary items | (56) | (56) | |
| Cash flow from operating activities (1) | (2,392) | (1,386) | |
| Investing activities: | |||
| Receipts relating to: | |||
| Investments | 1 | - | 7,900 |
| Property, plant and equipment | 27 | - | |
| Interest and similar income | 1,239 | 2,990 | |
| Dividends | 2 | 173,170 | 145,248 |
| Loans to Group companies | 3 | 65,500 | 112,000 |
| 239,935 | 268,138 | ||
| Payments relating to: | |||
| Property, plant and equipment | (108) | (964) | |
| Loans to Group companies | 3 | (58,500) | (109,500) |
| (58,608) | (110,464) | ||
| Cash flow from investing activities (2) | 181,327 | 157,673 | |
| Financing activities: | |||
| Receipts relating to: | |||
| Sale of treasury shares | 4,856 | 4,227 | |
| Loans from Group companies | 7,488 | - | |
| 12,344 | 4,227 | ||
| Payments relating to: | |||
| Loans obtained | (5,000) | (21,782) | |
| Interest and similar costs | (304) | (1,892) | |
| Dividends | (153,151) | (143,951) | |
| Purchase of treasury shares | (25,586) | (14,371) | |
| Loans from Group companies | 4 | (7,488) | (107,900) |
| (191,528) | (289,895) | ||
| Cash flow from financing activities (3) | (179,184) | (285,668) | |
| Change in cash and cash equivalents (4) = (1)+(2)+(3) | (250) | (129,381) | |
| Cash and cash equivalents at the beginning of the year | 857 | 130,252 | |
| Effect of currency translation | 9 | (14) | |
| Cash and cash equivalents at the end of the year | 616 | 857 |
The accompanying notes form an integral part of the financial statements for the year ended 31 December 2008.
Ricardo Manuel Simões Bayão Horta
Luís Eduardo da Silva Barbosa Jacques Lefèvre
Jean Carlos Angulo Jorge Manuel Tavares Salavessa Moura
Luís Filipe Sequeira Martins Manuel Luís Barata de Faria Blanc
Pedro Maria Calaínho Teixeira Duarte Vicente Arias Mosquera
José Manuel Baptista Fino José Enrique Freire Arteta
| Amounts received | |
|---|---|
| Cimpor Portugal, SGPS, S.A. | 92,840 |
| Cimpor Inversiones, S.L. | 80,317 |
| Cement Services Company, S.A.E. | 13 |
| 173,170 |
| Amounts paid | Amounts received | |
|---|---|---|
| during the year | during the year | |
| Cimpor - Indústria de Cimentos, S.A. | 58,500 | 65,500 |
| Amounts paid during the year |
Amounts received during the year |
|
|---|---|---|
| Cimpor Investimentos, SGPS, S. A. | 7,488 | 7,488 |
Cimpor - Cimentos de Portugal, SGPS, S.A.("the Company" or "Cimpor") was incorporated on 26 March 1976, as a wholly owned Portuguese Government company. After several privatisation phases, Cimpor is now a public company listed on the Lisbon stock exchange. The Company operates in Portugal, Spain, Morocco, Tunisia, Egypt, Turkey, Brazil, Peru, Mozambique, South Africa, China, India and Cape Verde ("the Cimpor Group").
The Company's investments are held essentially through two sub-holding companies; (i) Cimpor Portugal, SGPS, S.A., which holds the investments in companies dedicated to the production of cement, ready mix concrete, concrete parts and related activities in Portugal; and (ii) Cimpor Inversiones, S.L., which holds the investments in companies with head offices abroad.
The accompanying financial statements were prepared as a going concern basis from the Company's accounting records.
These financial statements are stated in thousands of euros and were prepared in accordance with generally accepted accounting principles in Portugal ("Portuguese GAAP"), which may be different from generally accepted accounting principles in other countries. The accompanying financial statements also include certain reclassifications in order to conform more closely to the form and content of financial statements presented in international financial markets.
The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenue and expenses during the report period. Actual results could differ from those estimates.
These financial statements refer to the company on an individual non-consolidated basis, investments being recorded in accordance with the equity method as described below. Under the article 4 of Regulation No.1606/2002 of the European Parliament and the Council of 19 July, the Company presents consolidated financial statements in accordance with International Financial Reporting Standards.
The principal accounting policies used in the preparation of the non-consolidated financial statements are:
Investments in group and associated companies are recorded using the equity method of accounting. Such investments being initially recorded at cost which is then increased or reduced to the amount corresponding to the proportion owned of the book value of the equity
of these companies as of the date of acquisition of the investment or the date the equity method was first applied.
Whenever necessary in order to conform the financial statements of group and associated companies to the Group's accounting policies, adjustments and reclassifications are made to them.
In accordance with the equity method of accounting, investments are adjusted by the amount corresponding to the Company's share in the net results of the group companies, by corresponding entry to the statement of profit and loss for the year (Note 18), and by other changes in the equity of subsidiary companies, by corresponding entry to the caption "Adjustments in equity investments" (Note 15). In addition, dividends received from these companies are recorded as decreases in the value of the investments.
Other investments are stated at cost less, when applicable, adjustments for estimated losses on realisation, except quoted securities measured at fair value, in accordance with the requirements of IAS 39 – Financial instruments: Recognition and Measurement ("IAS 39").
Goodwill arises from the difference between the cost of the investments in subsidiary companies and the related fair value of the subsidiaries' net assets as of the date of acquisition. Goodwill resulting from increases in previous investments are amortised on a straight-line basis over the remaining useful live period defined on the first acquisition. Goodwill is capitalised and amortised on a straight-line basis over its estimated realisation period, which varies from five to twenty years.
This caption consists in the acquired right of an aircraft fraction. Depreciation is provided on a straight-line basis over five years.
Property, plant and equipment is stated at cost, which includes acquisition expenses or, in the case of certain fixed assets acquired up to 31 December 1992, at restated value computed in accordance with the revaluation criteria established by the applicable Portuguese legislation.
Depreciation is provided on a straight-line basis over the estimated useful lives which correspond to the following estimated average useful lives:
| Years |
|---|
| 10 - 50 7 - 16 |
| 4 - 5 |
| 3 - 14 |
The provisions and adjustments are stated at the amount considered necessary to cover potential risks in the collection of overdue accounts receivable balances.
Other provisions and adjustments are recorded at the amounts considered necessary to cover estimated losses.
Foreign currency assets and liabilities for which there is no fixed exchange rate agreement are translated to euros at the rates of exchange prevailing at the balance sheet date. Exchange differences are credited or charged to the statement of profit and loss in the year in which they arise, except for the following, which are recorded in the balance sheet in the caption "Adjustments in equity investments":
Cash represents immediately available funds and cash equivalents include liquid investments readily convertible to cash with an original maturity of three months or less.
Certain subsidiary companies have assumed the responsibility for paying additional pensions to those paid by the Portuguese Social Security, under two different schemes: a defined benefit plan and a defined contribution plan. The related liabilities are recorded in accordance with Portuguese Accounting Directive 19.
In accordance with this directive, payments made to the defined contribution plan are expensed in the year to which they relate. In the case of the defined benefit plan, costs are expensed over the normal active service life of the employees.
An actuarial valuation is performed at the end of each period in order to calculate the present value of the past service liability and the cost to be recorded in the period. The present value of the past service liability is compared with the market value of the plan's assets in order to determine differences to be recorded in the balance sheet. The costs incurred in the year are recorded as payroll costs, based on the actuarial data.
Certain subsidiary companies have supplementary healthcare benefits for their employees to those provided by the Public Social Security. The liabilities and costs resulting from these benefits are recorded in a similar manner to the retirement pension liabilities and costs referred to above.
Specific provisions to cover these liabilities are recorded in accordance with the criteria established by Portuguese Accounting Directive 19.
The actuarially determined cost of healthcare to be provided as from retirement age is recorded in the balance sheet caption "Provisions for risks and charges".
The effects of those accounting records on these subsidiary companies are reflected on the Company's financial statements by the application of the equity method.
The Company has at its service, employees with contractual bond with Cimpor – Indústria de Cimentos, S.A. ("Cimpor Indústria"), which are beneficiary of retirement and healthcare benefits. The corresponding costs are supported by the Company and recorded as Payroll costs.
Additionally, since 1st January 2008, the Company as assumed a compromise of establishing a post-employment benefit plan to its employees (Note 21).
Tax on income for the period is calculated based on the taxable results and takes into consideration deferred taxation.
The Cimpor Group has adopted the tax consolidation regime presently in force in Portugal since 2001. In accordance with this regime the provision for income tax is determined based on the estimated consolidated taxable profit of all the companies covered by this regime (all the 90% or more owned subsidiaries located in Portugal). The remaining group companies not covered by the tax consolidation regime are taxed individually, based on their respective taxable profits, computed in accordance with the tax legislation, at the applicable tax rates.
Deferred tax assets and liabilities are calculated and assessed periodically attending to the temporary differences between the assets and liabilities book values and the corresponding values valid for tax purposes, using the rates expected to be in force when the temporary differences reverse and are not subject to discounting.
Deferred tax assets are only recognised when there is reasonable expectation that sufficient taxable profits will exist to use them. A reappraisal of the temporary differences underlying the deferred tax assets is made at the balance sheet date, so as to recognise or adjust them based on the current expectation of their future recovery.
Amounts recorded in this caption, resulting from the net increase in property, plant and equipment through revaluations made in accordance with the defined criteria, are transferred to retained earnings when realised through sale, write-off or depreciation of the related items. In general these amounts are not available for distribution and can only be used to increase share capital or to cover losses incurred up to the end of the period to which the revaluation relates.
The company records income and expenses on an accruals basis. Under this basis, income and expenses are recorded in the period to which they relate independently of when the corresponding amounts are received or paid. Differences between the amounts received and paid and the related income and expenses are recorded in accrual and deferral captions.
Assets to be realised and liabilities to be settled within one year of the balance sheet date are classified as current.
The Group has the policy of resorting to financial derivative instruments to hedge the financial risks to which it is exposed as a result of changes in interest rates and exchange rates.
In this respect the Group does not contract derivative financial instruments for speculation purposes.
The Group contract financial derivative instruments in accordance with internal policies set and approved by the Board of Directors.
Financial derivative instruments are measured at fair value. The method of recognising this depends on the nature and purpose of the transaction.
Derivative financial instruments are designated as hedging instruments in accordance with the provisions of IAS 39, as regards their documentation and effectiveness.
Changes in the fair value of derivative instruments designated as fair value hedges are recognised as financial income or expense for the period, together with changes in the fair value of the asset or liability subject to the risk.
Changes in the fair value of derivative financial instruments designated as cash flow hedging instruments are recorded in the caption 'Other reserves' as regards their effective component and in financial income or expense for the period as regards their non effective component. The amounts recorded under 'Other reserves' are transferred to the statement of profit and loss in the period in which the effect on the item covered is also reflected in the statement of profit and loss.
Changes in the value of derivative financial instruments hedging net investments in a foreign entity, are recorded in the caption Adjustment in equity investments as regards their effective component. The non effective component of such variations is recognised immediately as financial income or expense for the period. If the hedging instrument is not a derivative, the corresponding variations resulting from changes in the exchange rate are included in the caption Adjustment in equity investments.
Hedge accounting is discontinued when the hedging instrument matures, is sold or exercised, or when the hedging relationship ceases to comply with the requirements of IAS 39.
Changes in the fair value of derivative financial instruments which are contracted for financial hedging purposes in accordance with the Group's risk management policies, but do not comply with all the requirements of IAS 39 to qualify for hedge accounting, are recorded in the statement of profit and loss for the period in which they occur.
The effects of the recognition of these instruments in the Group companies that contract these instruments, are reflected under the heading of "Investments, net", by the application of the equity method.
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Accounts receivable from affiliated companies (Note 13) | 11,462 | 22,342 |
| Accounts receivable from public entities | 1,363 | 1,365 |
| Other receivables | 138 | 145 |
| 12,962 | 23,852 |
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Doubtful accounts receivable | 3,145 | 3,214 |
| Other receivables | 611 | 615 |
| 3,756 | 3,829 | |
| Adjustments for doubtful accounts receivable (Note 14) | (3,754) | (3,822) |
| 2 | 7 |
The Company classifies, as doubtful, specific overdue accounts receivable balances from customers. As these balances, together with other balances classified under the caption other receivables are not fully collectible, the Company records an adjustment for doubtful accounts receivable to cover the estimated loss on their realisation.
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Affiliated companies: | ||
| Cimpor Inversiones, S.A. | 641,444 | 820,531 |
| Cimpor Portugal, SGPS, S.A. | 438,480 | 571,413 |
| Cimpor Reinsurance, S.A. | 10,855 | 10,138 |
| Cimpor Financial Operations, B.V. | 4,473 | 3,725 |
| Cimpor Tec - Engenharia e Serviços Técnicos de Apoio ao | ||
| Grupo, S.A. | 1,573 | 1,220 |
| Cement Services Company, S.A.E. | 137 | 114 |
| Cimpor Egypt For Cement Company, S.A.E. | 6 | 5 |
| 1,096,967 | 1,407,145 | |
| Securities and other investments: | ||
| Companhia de Cimentos de Moçambique, S.A. | 4,050 | 4,050 |
| Others | 73 | 74 |
| 4,123 | 4,124 | |
| Adjustments for investments | (4,051) | (4,051) |
| 1,097,041 | 1,407,219 |
The investments in affiliated companies are recorded in accordance with the equity method of accounting after any adjustment or reclassification to conform the affiliated companies financial statements with the Company's accounting policies. Other participations are stated at cost less, when applicable, adjustments for estimated losses on realisation.
The application of the equity method to investments in affiliated companies at 31 December 2008 had the following impact:
| Profit in group companies (Note 18) |
Adjustment in equity investments (Note 15) |
Dividends | Total | |
|---|---|---|---|---|
| Cement Services Company, S.A.E. | 29 | 7 | (13) | 23 |
| Cimpor Egypt for Cement Company, S.A.E. | 1 | - | - | 1 |
| Cimpor Financial Operations, B.V. | 748 | - | - | 748 |
| Cimpor Inversiones, S.A. | 101,672 | (200,442) | (80,317) | (179,086) |
| Cimpor Portugal, SGPS, S.A. | 8,281 | (48,374) | (92,840) | (132,933) |
| Cimpor Reinsurance, S.A. | 717 | - | - | 717 |
| Cimpor Tec - Engenharia e Serviços Técnicos | ||||
| de Apoio ao Grupo, S.A. | 353 | - | - | 353 |
| 111,801 | (248,809) | (173,170) | (310,178) |
The adjustments in equity investments relating to Cimpor Inversiones include: (i) the effect of adopting the provisions of IAS 39 related to hedge accounting and derivative financial instruments recognition; and (ii) the effect of translating the foreign currency financial statements of affiliated companies.
This caption comprises the following, at net book value:
| Cost: | 2008 | 2007 |
|---|---|---|
| Land | 2,409 | 2,409 |
| Buildings and other constructions | 8,950 | 8,947 |
| Basic equipment | 3,095 | 3,095 |
| Transportation equipment | 378 | 383 |
| Administrative equipment | 5,346 | 5,346 |
| 20,178 | 20,181 | |
| Accumulated depreciation: | ||
| Buildings and other constructions | (5,522) | (5,341) |
| Basic equipment | (3,068) | (3,064) |
| Transportation equipment | (226) | (262) |
| Administrative equipment | (5,031) | (5,027) |
| (13,847) | (13,694) | |
| Net book values: | ||
| Land | 2,409 | 2,409 |
| Buildings and other constructions | 3,428 | 3,606 |
| Basic equipment | 26 | 31 |
| Transportation equipment | 152 | 121 |
| Administrative equipment | 316 | 319 |
| 6,331 | 6,487 |
Property, plant and equipment has been revaluated in accordance with Decree Laws 126/77, 219/82, 399-G/84, 118-B/86, 111/88, 49/91, 22/92 and 264/92, and Law 36/91, using price indices established by those legislations.
The effect of the revaluations on net book value is as follows:
(Amounts stated in thousands of euros)
(Translated and reformatted from the Portuguese original – Note 25)
| Historical | Revalued | ||
|---|---|---|---|
| cost | Revaluation | amounts | |
| Land | 359 | 2,050 | 2,409 |
| Buildings and other constructions | 862 | 2,566 | 3,428 |
| Basic equipment | 26 | - | 26 |
| Transportation equipment | 152 | - | 152 |
| Administrative equipment | 296 | 20 | 316 |
| 1,695 | 4,636 | 6,331 |
A portion (40%) of the additional depreciation arising from the revaluations is not deductible for income tax purposes, originating a deferred tax liability of 274 thousand euros (Note 12).
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Accounts payable to related companies (Note 13) | 418 | 296 |
| Accounts payable to suppliers | 750 | 695 |
| Other creditors | 126 | 28 |
| 1,294 | 1,019 |
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Vacation pay and vacation bonus | 995 | 986 |
| Derivative financial instruments (Note 23) | 6 | 208 |
| Defined contribution plan (Note 21) | 17 | - |
| Interest payable | - | 8 |
| Other | 148 | 107 |
| 1,166 | 1,309 |
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Derivative financial instruments (Note 23) | 6 | 208 |
| Insurance | 33 | 29 |
| Interests receivable | - | 3 |
| Other | 286 | 259 |
| 325 | 500 |
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Income tax | 1,698 | 3,232 |
| Withholding tax | 111 | 108 |
| Value added tax | 91 | 87 |
| Social Security contributions | 103 | 94 |
| 2,003 | 3,522 |
The income tax payable is the result of the special regime for taxation of groups of companies that Cimpor Group is subject.
During the year ended 31 December 2008, the movement in the provision account balances, was as follows:
| Beginning balance |
Increases | Decreases | Ending balance |
|
|---|---|---|---|---|
| Provisions for other risks and charges: | ||||
| Tax provisions (Note 12) | 91,930 | 6,196 | (49,574) | 48,553 |
| Other risks and charges | 31 | - | - | 31 |
| 91,961 | 6,196 | (49,574) | 48,584 |
The increases and decreases in the provision for tax contingencies were recorded by corresponding entries to the following captions:
| Increases | Decreases | |
|---|---|---|
| Provisions | 2,408 | - |
| Tax provisions (Note 12) | 3,788 | (49,574) |
| 6,196 | (49,574) | |
The Company is subject to Corporate Income Tax ("CIT") at the rate of 25%, and municipal surcharge up to 1,5%, which sums a total tax rate of 26,5%. Gains and losses in associated companies recorded under the equity method are not relevant for tax purposes. The same applies to dividends received from affiliated companies.
As from 2001, the Company and its over 90% held Portuguese subsidiaries are subject to the special regime for taxation of groups of companies (RETGS). This regime consists of applying the CIT rate to the consolidated taxable results of the companies included in the special regime plus the municipal surcharge, and excluding dividends distributed between those companies. The Company is also subject to autonomous taxation over certain expenses mentioned in article 81 of the CIT Code.
In accordance with current legislation, the Company's tax returns are subject to reviews performed by the tax authorities for a period of four years (for Social Security purposes ten years, until 2000, and five years from 2001), except if there are tax losses computed, tax benefits granted or tax audits, claims or appeals in progress, in which cases the periods can be extended or suspended. At the date of this report, the Company's tax returns were reviewed by the tax authorities up to the tax year of 2005, and the tax audit for 2006 is in course.
As a result of the reviews performed by the tax authorities to the CIT returns for the years of 1996 to 2005, additional adjustments were made to the assessment basis and to tax, determined under the tax consolidation regimes, being the most significant adjustments from the increase of depreciations resulting from the revaluation of property, plant and equipment. The Board of Directors believes, based on the understanding of its tax consultants, that the above mentioned adjustments have no legal basis and therefore they have been legally claimed.
In addition, the Board of Directors believes that any payment of the above tax, resulting from tax assessments up to the tax year of 2001 or subsequent if influenced by operations up to that date, are the responsibility of the Government body, "Fundo de Regularização da Dívida Pública".
For the years 1997 and 1998 this subject was sanctioned by the 1st Ruling Section of the Supreme Administrative Court, which consequences are the recognition, as always has been defended by Cimpor, that the payment of the above tax, resulting from additional tax assessments related to these years, it's responsibility of "Fundo de Regularização da Dívida Pública". The provisions for legal and tax risks, previously created to cover additional tax assessments for those years, were cancelled (Note 11).
The Board of Directors believes that the recorded provisions (Note 11) reflect, prudently, the potential risks associated with the probability that the adjustments may result in future payments, including an estimate for the years not yet audited.
Temporary differences between the recognition of income and expenses for accounting and tax purpose are considered in computing the income tax charge for the year.
Reconciliation of the provision for income tax at the statutory Portuguese income tax rate, for the year ended 31 December 2008 and the effective income tax rate, was as follows:
| Tax base | Income tax | |
|---|---|---|
| Income before income tax | 102,612 | |
| Temporary differences | 37 | |
| Permanent differences | (111,308) | |
| (8,659) | ||
| Normal charge | (2,165) | |
| Tax deductions | (63) | |
| Tax adjustments | 1 | |
| Autonomous taxation | 36 | |
| (2,190) | ||
| Deferred tax on temporary differences reversed in the period | (2) | |
| Tax provisions (Note 11) | (45,786) | |
| Prior year adjustments | 331 | |
| Adjustments to the consolidated Group's tax and others | (3,720) | |
| (51,366) |
Permanent differences include mainly elimination of the effect of applying the equity method (Notes 5 and 18).
The movement in deferred taxes in the year ended 31 December 2008 is as follows:
| Beginning | Ending | ||
|---|---|---|---|
| balance | Reversal | balance | |
| Deferred tax assets: | |||
| Adjustments for doubtful debts | 293 | (9) | 284 |
| Provision for other risks and charges (Note 11) | 11 | (3) | 8 |
| 304 | (11) | 292 | |
| Deferred tax liabilities: | |||
| Revaluation of tangible fixed assets (Note 6) | 287 | (13) | 274 |
The principal balances and transactions in the year ended 31 December 2008 with Group companies are as follows:
| Balances | Transactions | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Group companies, accounts receivable (Note 3) |
Accounts payable |
Deferal and accruals |
Group companies, accounts payable (Note 7) |
Interest expenses (Note 18) |
Interest income (Note 18) |
Services rendered (Note 16) |
Other operations income |
Outside supplies and serviçes |
|
| Agrepor Agregados, S.A. | 5 | - | - | 10 | - | - | - | 4 | 4 |
| Betão Liz, S.A. | - | - | 9 | - | - | - | - | - | |
| Cecisa - Comércio Internacional, S.A. | 1 | - | - | - | - | - | - | 1 | - |
| Cimpor - Indústria Cimentos, S.A. | 2,487 | - | 12 | 280 | - | 848 | 4,515 | - | 11 |
| Cimpor Betão -Indústria Betão Pronto, S.A. | 150 | - | - | 9 | - | - | - | 150 | - |
| Cimpor Imobiliária, S.A. | 9 | - | 18 | - | - | - | - | 1 | - |
| Cimpor Internacional, SGPS, S.A. | 24 | - | - | - | - | - | 60 | - | - |
| Cimpor Investimentos, SGPS, S.A. | - | - | - | 64 | - | 25 | - | - | |
| Cimpor Portugal, SGPS, S.A. | 8,579 | - | - | 100 | - | - | - | - | - |
| Cimpor - Serviços Apoio à Gestão Empresas, S.A. | 154 | 503 | - | 10 | - | - | - | 506 | 1,686 |
| Cimpor Tec - Engenharia e Serviços Técnicos | |||||||||
| de Apoio ao Grupo, S.A. | 3 | - | - | - | - | - | - | 3 | 1 |
| Imopar, SARL | 9 | - | - | - | - | - | - | - | - |
| Jomatel - Emp. Mat. Construção, S.A. | 40 | - | - | - | - | - | - | - | - |
| 11,462 | 503 | 30 | 418 | 64 | 848 | 4,600 | 665 | 1,702 |
The balance receivable from Cimpor Portugal, SGPS, S.A. is due to tax income according to the special regime for taxation of groups of companies (Note 12).
The balance receivable from Cimpor Indústria de Cimentos, S.A. includes 2,000 thousand euros relating to treasury support, which earns interest at normal market rates.
During the year ended 31 December 2008, the movement in accounts receivable adjustments was as follows:
| Beginning balance |
Utilisation | Reversal | Ending balance |
|
|---|---|---|---|---|
| Adjustments for: | ||||
| Doubtful accounts receivable | 3,212 | (20) | (48) | 3,143 |
| Other debtors/ shareholders | 611 | - | - | 611 |
| 3,822 | (20) | (48) | 3,754 |
At 31 December 2008, Cimpor's fully subscribed and paid up share capital consisted of 672 million shares with a nominal value of one euro each.
The last known capital structure of the Company, as per notifications of official qualifying shareholders received by the company until 31 December 2008, was as follows (includes shares owned by its related companies and its corporate board members):
| Number of | ||
|---|---|---|
| % | shares | |
| Teixeira Duarte, SGPS, S.A. | 22.90 | 153,884,443 |
| Manuel Fino, SGPS, S.A. | 20.26 | 136,141,960 |
| Lafarge, S.A. | 17.28 | 116,089,705 |
| Banco Comercial Português, S.A. (BCP) and BCP Pension Fund | 10.04 | 67,474,186 |
| Bipadosa, S.A. | 6.68 | 44,912,524 |
| Sr. Ten-Cor. Luís Augusto da Silva | 2.09 | 14,049,090 |
| Others | 20.75 | 139,448,092 |
| 100.00 | 672,000,000 |
This caption results from the revaluation of property, plant and equipment in accordance with the applicable legislation (Note 6). In accordance with current legislation this reserve can only be used to cover losses or to increase share capital.
In accordance with current legislation the Company must appropriate, to the legal reserve, at least 5% of its annual net profit until the reserve equals a minimum of 20% of capital. This reserve cannot be distributed to the shareholders but can be used to absorb losses once all the other reserves have been used, up or to increase capital.
This caption, in the year ended 31 December 2008, relate mainly to: (i) transfer from "Retained earnings" to "Adjustments in equity investments" of the results not distributed by subsidiary companies recorded in accordance with the equity method; (ii) adjustment of investments resulting from changes in the equity of subsidiary companies (Note 5).
The net profit for the year ended 31 December 2007, in accordance with a decision of the Shareholders' Annual General Meeting held on 9 May 2008, was appropriated as follows:
| Dividends | 154,560 |
|---|---|
| Employees' bonus | 3,000 |
| Retained earnings | 81,159 |
| Legal reserve | 12,565 |
| 251,284 |
Undistributed dividends attributed to own shares, in the amount of 1,325 thousand euros, are included on the caption "Other reserves and retained earnings".
Commercial legislation relating to treasury shares requires the existence of a free reserve equal to the amount of the cost of such shares, which is not available for distribution while the shares are not sold. In addition, the applicable accounting rules require gains and losses on the sale of own shares to be recorded in reserves.
The movement in treasury shares, in the year ended 31 December 2008, corresponds to: (i) the sale of 1,168,620 shares to several employees of the Group (Note 22) for a total of 4,855 thousand euros, which resulted in an increase of 722 thousand euros in Other reserves and retained earnings; (ii) the acquisition of 5,643,243 shares in several market operations, in the year ended 31 December 2008, by a total amount of 25,586 thousand euros.
At 31 December 2008 Cimpor held 8,476,832 treasury shares (Note 22).
Other reserves are available to be distributed, except what concerns to the reserve became unavailable, according to the commercial law applicable to treasury shares, in the amount of 41,640 thousand euros.
Services rendered for the year ended 31 December 2008 result from contracts to render management and administrative services entered into with affiliated companies (Note 14).
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Salaries | 5,900 | 5,781 |
| Social charges: | ||
| Pensions | 150 | 133 |
| Others | 1,936 | 1,914 |
| 7,986 | 7,828 |
In the year ended 31 December 2008, the Company´s corporate board remuneration was as follows:
| Fixed | Variable | ||
|---|---|---|---|
| remuneration | remuneration | Total | |
| Executive directors | 1,292 | 2,697 | 3,988 |
| Non-executive directors | 537 | - | 537 |
| 1,828 | 2,697 | 4,525 |
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Income: | ||
| Interest income | 1,157 | 10,221 |
| Gains in Group companies (Note 5) | 111,801 | 250,054 |
| Foreign exchange gains | 13 | 4 |
| 112,971 | 260,279 | |
| Expenses: | ||
| Interest expenses | 391 | 8,780 |
| Foreign exchange losses | 4 | 21 |
| Other financial expenses | 104 | 92 |
| 500 | 8,893 | |
| Financial income, net | 112,471 | 251,386 |
This caption consists of:
| 2008 | 2007 | |
|---|---|---|
| Extraordinary income: | ||
| Debt recovery | 1 | 16 |
| Gains on the sale of fixed assets | 23 | 609 |
| Provision decreases | - | 3,641 |
| Prior year adjustments | - | 35 |
| Other extraordinary income | 38 | 31 |
| 62 | 4,331 | |
| Extraordinary expenses: | ||
| Donations | 60 | 62 |
| Uncollectible debts | - | 199 |
| Fines and penalties | 6 | - |
| Prior year adjustments | 86 | - |
| Other extraordinary expenses | 14 | 182 |
| 166 | 443 | |
| Extraordinary items, net | (104) | 3,888 |
At 31 December 2008 the Company had guarantees given to third parties totalling 75,686 thousand of euros. These guarantees were given to the tax authorities, to cover the additional tax assessments received, which responsibility is considered on the caption of tax contingencies on Provisions for other risks and charges (Note 11), and to bank entities.
As explained in Note 2, some Group companies have supplementary retirement and healthcare plans for their employees. The liability under these plans is reflected in the financial statements as of 31 December 2008 in accordance with the applicable accounting standards.
In the year ended 31 December 2008, Group liabilities with active and retired employees past services, ascend to 90,907 thousand euros, of which 69,807 thousand euros are financed by pension funds, being the remaining in the amount of 21,100 thousand euros, registered in liabilities of the correspondent affiliated companies.
As a result of applying the equity method of accounting, the effect of these plans is reflected in the Company's financial statements in the captions Financial income, and Investments.
As explained in Note 2, the Company additionally supported 564 thousand euros related to retirement and healthcare benefits given to employees with contractual bond with Cimpor Indústria.
Additionally, since 1st January 2008, the Company assumed a compromise of establishing a post-employment benefit plan to its employees. This plan is characterized by giving a retirement benefit, being the annual contribution of 4% of the base remuneration, plus seniority bonus.
Are beneficiaries of this contribution plan, all employees with contractual bond with the Company in 1st January 2008 or hired since that date, as long as have or will have a contractual bond with the Company equal or exceeding five years, or those having a shorter contractual bond but reaching the legal retirement age for oldness in the service of the Company.
In the year ended 31 December 2008, the Company has recorded an accrued expense of 17 thousand euros (Note 8), concerning to the responsibility of the contribution to the fund to be constituted.
At 31 December 2008 some of the Group companies had commitments relating to contracts to purchase tangible fixed assets and inventories as well for operating on third parties installations of 54,721 thousand euros, the most significant amounts being 20,981 thousand euros relating to the Portugal business area, 15,822 thousand euros relating to the Spain business area, 12,513 thousand euros relating to the Egypt business area, 2,151 thousand euros relating to the India business area and 1,935 thousand euros relating to the Morocco business area.
On 1 February 2005 a contract to render administrative, financial, accounting and human resources services was entered into between the Company and Cimpor – Serviços de Apoio à Gestão de Empresas, S.A.. The contract involves an annual commitment of 1,678 thousand euros.
In accordance with Portuguese Commercial Company Code ("Código das Sociedades Comerciais"), the company Cimpor – Cimentos de Portugal, SGPS, S.A. is jointly responsible for the obligations of its subsidiaries.
Comfort letters relating to group companies, given to third parties, are as follows:
| Corporacion Noroeste, S.A. | 49,898 |
|---|---|
| Cimpor Cimentos do Brasil, LTDA. | 2,056 |
| Cimentos de Moçambique, S.A.R.L. | 1,352 |
| 53,305 |
At the Shareholders' General Meeting held on 9 May 2008 an Employee Stock Acquisition Plan and a Cimpor Shares Stock Option Plan were approved.
The Board of Directors of CIMPOR – Cimentos de Portugal, SGPS, S.A., is responsible for granting the benefits under these plans, other than to its own members, in which case the benefits are granted by the Remuneration Committee.
The beneficiaries of Employee Stock Acquisition Plan are granted with the right to acquire shares at a price equal to seventy-five percent of the closing price on the day the transaction is carried out, up to the amount that does not exceed half of his/her monthly gross base remuneration.
The beneficiaries of the Cimpor Shares Stock Option Plan are granted with the right to acquire Cimpor shares (initial options), at a price not lower than seventy-five percent of the average of the closing prices on the sixty stock market sessions preceding that date. For each option exercised, the beneficiary is granted the option to acquire one new share (derivative options), at the same price, in each of the following three years.
The options exercised and the shares bought during the year ended 31 December 2008 were as follows:
| Plan | Number of shares |
Unit price | Date |
|---|---|---|---|
| Stock Option Plan - derivative options - series 2005 | 276,700 | 3.30 | 17 March |
| Stock Option Plan - derivative options - series 2006 | 240,440 | 4.05 | 17 March |
| Stock Option Plan - derivative options - series 2007 | 229,610 | 4.90 | 17 March |
| Stock Option Plan - initial options - series 2008 | 264,490 | 4.25 | 27 May |
| Employee Stock Acquisition Plan - year 2008 | 157,380 | 4.57 | 13 May |
| 1,168,620 |
As at 31 December 2008, the Company held sufficient treasury stock to face the responsibilities inherent to the above mentioned stock options plans.
In the year ended 31 December 2008, the Company remains the formal part in an interest rate derivative contract, designated as a trading instrument since it does not comply with all the requirements of IAS 39 to qualify for hedge accounting, which fair value at that date was negative in 6 thousand euros.
The most significant events that occurred after 31 December 2008 are described in the Directors' Report.
The accompanying financial statements are a reformatted translation of financial statements originally issued in Portuguese in accordance with generally accepted accounting principles in Portugal and the disclosures required by the Portuguese Official Chart of Accounts, some of which may not conform with or be required by generally accepted accounting principles in other countries. In the event of discrepancies the Portuguese language version prevails.
To the Shareholders,
As required by law and the articles of association of CIMPOR – Cimentos de Portugal, SGPS, S.A. (the Company) and in accordance with our mandate, the Audit Board hereby submits its opinion on the financial statements for 2008, which had been submitted to us for scrutiny by the Board of Directors.
The Audit Board accompanied the activity and business of the Company by examining documents and accounting records, review the minutes of meetings of the Board of Directors and Executive Committee and analysing other documents in order to assess compliance with the law and articles of association. The Audit Board also performed tests and other procedures in as much detail as it saw fit. The Audit Board remained in contact with the Board of Directors and with other directors and obtained all necessary information and clarifications whenever requested.
As part of our duties, we examined the Annual Report of the Board of Directors and concluded that it is in compliance with legal requirements. We also analysed the accounts of the financial year ended on 31 December 2008, which consists of the balance sheet, profit and loss accounts by nature and function, cash flow statement and their respective notes, as prepared by the Board of Directors, with regard to the accounting standards used in their preparation and respect for the law and articles of association.
The proposal for the appropriation of profit submitted by the Board of Directors complies with applicable legislation and the articles of association.
The Audit Board has viewed the Legal Certification of Accounts and Audit Report issued by the statutory auditor, with which it agrees.
We are therefore of the opinion that the above accounting documents and the proposal for the appropriation of results are in accordance with the applicable accounting standards and requirements of the law and articles of association and can therefore be approved by the shareholders.
The Audit Board wishes to thank the Board of Directors and other personnel of CIMPOR – Cimentos de Portugal, SGPS, S.A., for their cooperation.
Page 2 of 2 2
Lisbon, 27 April 2009
Luís Black Freire d'Andrade Member
Jaime de Macedo Santos Bastos Member
(Translation of a report originally issued in Portuguese)
Page 2 of 2
Lisbon, 24 April 2009
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