Quarterly Report • Nov 26, 2015
Quarterly Report
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ESTORIL-SOL, SGPS, S.A. Capital social integralmente realizado 59.968.420 Euros Sociedade Anónima com sede na Av. Dr. Stanley Ho, Edifício do Casino Estoril, 2765-190 Estoril - Cascais
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| Governing Bodies | 3 |
|---|---|
| Management Report | 5 |
| Holders of qualified shareholdings | 13 |
| Consolidated Financial Statements and Notes | 15 |
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| Chairman Deputy Chairman Secretary |
- Pedro Canastra de Azevedo Maia - Tiago Antunes da Cunha Ferreira de Lemos - Marta Horta e Costa Leitão Pinto Barbosa |
|---|---|
| ADVISORY BOARD | |
| Chairman | - Rui José da Cunha |
| REMUNERATION COMMITTEE | |
| - Ho Chiu King, Pansy Catilina - Jorge Armindo de Carvalho Teixeira - Calvin Ka Wing Chann |
|
| BOARD OF DIRECTORS | |
| Chairman Deputy-Chairmen Members |
- Stanley Hung Sun Ho - Mário Alberto Neves Assis Ferreira - Huen Wing Ming, Patrick - Ho Chiu King, Pansy Catilina - So Shu Fai, Ambrose - Man Hin Choi - António José de Melo Vieira Coelho - Vasco Esteves Fraga - Jorge Armindo de Carvalho Teixeira - Calvin ka Wing Chann - Miguel António Dias Urbano de Magalhães Queiroz |
| EXECUTIVE COMMITTEE | |
| Chairman Deputy-Chairmen |
Ho Chiu King, Pansy Catilina Jorge Armindo de Carvalho Teixeira Vasco Esteves Fraga Calvin ka Wing Chann |
| AUDIT BOARD | |
| Chairman Deputy-Chairmen Alternates |
- Mário Pereira Pinto - António José Alves da Silva - Manuel Martins Lourenço - Armando do Carmo Gonçalves |
| COMPANY SECRETARY | |
| Secretary: Alternate: |
- Carlos Alberto Francisco Farinha - Artur Alexandre Conde de Magalhães Mateus |
| STATUTORY AUDITOR | - Lampreia & Viçoso, SROC - Represented by José Martins Lampreia |
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Estoril Sol, S.A. was incorporated on 25 June 1958 and its company object is "the operation of the gambling concession, on an exclusive basis, in the Estoril permanent area, including other related trade and industries".
On 18 March 2002, ESTORIL-SOL, SA modified its legal status to "Holding Company, SGPS", Public Corporation, thereby no longer directly conducting any business activities, and such business is now to be conducted by various associated undertakings which have been incorporated for this purpose.
The Company held indirectly through subsidiaries interests in the tourism sector, in particular, in gaming activities at casinos. The Company owns the Game Concessions of Estoril (Casino do Estoril and Casino Lisboa) and Póvoa de Varzim.
At 30 th September 2015, the share capital of ESTORIL-SOL, S.G.P.S., S.A. was 59.628.420 Euros, represented by 11.993.684 shares with a nominal unit value of 5 (five) Euros, of which 6.116.779 were registered shares and 5.876.905 bearer shares.
At the time this report was prepared, ESTORIL SOL, SGPS, S.A. held 62.565 treasury shares, with no trading taking place during the financial year.
During the first quarter of 2015, the Company, did not sold or acquired own shares.
The Company's shares are listed on the Lisbon Stock Exchange since February 14, 1986.
The price and trading volume of Estoril-Sol, SGPS, SA securities, on the dates of reporting to the market during the year 2015 were according table below:
| Date for disclosing Estoril-Sol, SGPS, S.A. , information | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Price (Euros) | |||||||||
| Disclosure | Date | Qtd | Open | High | Low | Close | |||
| Annual results for 2014 2015, 1st Quarter results 2015, Semester results |
30/04/2015 29/05/2015 21/08/2015 |
1000 179 330 |
1,06 1,01 0,95 |
1,06 1,01 0,95 |
1,06 1,01 0,95 |
1,06 1,01 0,95 |
On 30 th September 2015, ESTORIL-SOL, S.G.P.S., S.A. had the following stakes in the following subsidiaries:
ESTORIL-SOL (III) - TURISMO ANIMAÇÃO E JOGO, S.A., incorporated on 26 July 2001, headquartered in Estoril, the social object of which is the operation of games of chance in areas where this is permitted by law and, in addition, may also operate in the tourism, hotel, restaurant and entertainment industries, as well as providing consultancy services in those areas of activity. This company operates the Estoril and Lisbon Casinos.
Its share capital of EUR 34,000,000 is 100% held by ESTORIL-SOL, S.G.P.S., S.A.
VARZIM SOL - ANIMAÇÃO, TURISMO E JOGO, S.A., headquartered in Póvoa de Varzim, has the social object, in particular, of operating the gambling concession of Póvoa de Varzim. This company operates the Póvoa de Varzim Casino.
It has a share capital of EUR 33.650.000, 100% held by ESTORIL SOL, S.G.P.S., S.A..
ESTORIL-SOL (V) – INVESTIMENTOS IMOBILIÁRIOS, S.A. - Its share capital of EUR 50,000 is fully paid up by ESTORIL-SOL, S.G.P.S., S.A.. The Company is now idle, but owns a site located on maritime land in the parish of Ericeira.
DTH - DESENVOLVIMENTO TURÍSTICO E HOTELEIRO, SA – With a share capital of EUR 2,429,146, is 100% held by ESTORIL-SOL, S.G.P.S., S.A.. It owns a plot of land in Monte Estoril, where the former Miramar Hotel stood.
ESTORIL-SOL IMOBILIÁRIA, S.A. - With a share capital of EUR 7,232,570, it is 100% owned by ESTORIL SOL, S.G.P.S., S.A.. Its social object is the construction, promotion, management and sale of tourist complexes and real estate.
PARQUES DO TAMARIZ - SOCIEDADE EXPLORAÇÃO DE PARQUES DE ESTACIONAMENTO, S.A. - ESTORIL- SOL S.G.P.S., S.A., through Estoril Sol Imobiliária, SA, holds a 33.3% stake in the share capital of the company, which is EUR 1 500 000. The company has a licence to build a car park on the land next to Estoril Casino.
ESTORIL-SOL - INVESTIMENTOS HOTELEIROS, S.A. - With a share capital of EUR 10,835,000 is 90% held by ESTORIL SOL, S.G.P.S., S.A., with the remaining 10% being held by the company itself.
ESTORIL-SOL E MAR – INVESTIMENTOS IMOBILIÁRIOS, S.A. - With a share capital of EUR 1.286.000, is fully paid up by ESTORIL-SOL, S.G.P.S., S.A.
ESTORIL-SOL DIGITAL – ONLINE GAMING PRODUCTS AND SERVICES, S.A. – with a Share Capital of EUR 500.000 is 100% held by ESTORIL-SOL (III) –TURISMO, ANIMAÇÃO E JOGO, S.A.
The Company was founded in September 2015 in order to apply for an online gaming license. As described in point 5 "Relevant Facts", the Group Estoril-Sol disagrees with the regulation now applicable for online gambling which represents a penalty to the gambling concessionaires as it unilaterally terminates the exclusive right of exploitation of games of fortune and chance in Portugal.
(a) - Holds 10% of its Share Capital
The recovery trend of gaming revenues growth rate that began in the second half of 2014 remained during
10,00%
the year 2015. As consequence, the gaming revenues increased in the first nine months of 2015 when compared with the same period last year, 7,2% in the industry and 7,6% in the Estoril-Sol Group.
If this positive trend continues in the months to come, the year 2015 may end the negative cycle of gaming revenues growth, a cycle observed since 2009 that caused accumulated game revenues losses of nearly 30% in Portugal.
There are eleven casinos operating in Portugal. Estoril-Sol Group, through its subsidiaries, operates three of the four biggest casinos in Portugal, accounting for 63% of net income and taxes paid and generated by the activity in Portugal.
Revenues from gambling in Portugal during the first nine months of 2015 amounted to approximately 214,7 million Euros, an increase of 7,2% compared to last year which represents almost 14,5 million Euros. In the same period the Group game revenues achieved 134,9 million Euros, an increase of 7,6% equivalent to 9,6 million Euros.
Excluding Casino de Tróia in face of its little expression for the industry, Casino da Póvoa showed the best performance off all the casinos operating in Portugal during the first nine months of 2015. Casino da Póvoa revenues grew 15,1% achieving 30,9 million Euros. The other casinos of the
Group showed as well very good performances, Casino Estoril revenues grew 4,3% achieving 45,8 million Euros, while Casino Lisboa revenues grew 6,7% achieving 58,1 million Euros.
The other operating revenues of Estoril-Sol, restaurant and entertainment, grew by 29,8% to 6,5 million Euros. The increase in these revenues is partially justified by the game revenues increase and also for the strengthening and promotion of leisure and entertainment areas within the casinos operated by Estoril-Sol. The operating cost increase by 13% mainly reflects this investment undertaken by the Group to streamline and increase the entertainment offer within the casinos.
The Group improved its operating results by almost 12%, with a positive EBITDA of 22,2 million Euros for the first nine months of 2015.
| Sep-15 | Sep-14 | Var % | |
|---|---|---|---|
| Gaming Revenue Special Gaming Tax |
134.766.210 -70.651.545 |
125.311.581 -67.590.519 |
7,5% a) |
| Effective Tax Rate | 52% | 54% | |
| Game Revenue - Net | 64.114.665 | 57.721.062 | 11,1% |
| Other revenue ( F&B / Entertainment ) | 6.533.159 | 5.031.363 | 29,8% |
| Operating costs | -48.439.265 | -42.869.201 | 13,0% |
| EBITDA | 22.208.559 | 19.883.224 | 11,7% |
| Amortization and Depreciation | -15.987.429 | -15.731.676 | 2% |
| Financial Costs | -3.709.049 | -5.152.594 | -28% |
| Income tax (IRC) | -50.700 | -45.500 | 11% |
| Consolidated net result of the year | 2.461.379 | -1.046.546 | 335% |
a) Includes the amounts recorded in "Gaming taxes" as "Special Gaming tax (current)" and "Annual gaming tax ( difference to minimum grant )"
In a concerted effort to financial stability and less dependence on third parties, the Group has been successively reducing its bank debt. This reduction resulted in a significant decrease in financial costs
incurred by the Group Estoril-Sol, a decrease of 28% over the first nine months of 2015 compared to same period last year. Estoril-Sol supported almost 3,7 million Euros with loan interests during the first nine months of 2015.
At the 30th of September 2015 the Group consolidated financial debt amounted to 63,3 million Euros, as a result of the 20,6 million Euros reimbursed since the beginning of the year.
The favorable combination of game revenues growth and substantial financial bank debt reduction allowed the Group to show a positive consolidated net result of 2,4 million Euros compared to losses of 1,04 million Euros in the previous year. While it is desirable for obvious reasons that this trend continue in the nearby future, it is prudent to consider that this positive trend in gaming revenues and in the Group financing costs may be conditioned by potential political events in the Eurozone that results in significant changes in the reference interest rates.
By analyzing the results at casino level, it is possible to conclude that only Casino Lisboa has a positive net
result, approximately 8,6 million Euros. Still, it is important to highlight the fact that in the first nine months of 2015, all Group casinos presented posi-tive operational results (EBITDA).
It must be emphasized that these performances, with special focus over Casino da Póvoa, have been repeatedly pena-lized by tax rates applied to game revenues, which in the
| Estoril | Lisboa | Póvoa | Other | |
|---|---|---|---|---|
| Gaming Revenue | 45.754.791 | 58.086.115 | 30.925.304 | |
| Game taxes | -22.936.201 | -29.066.595 | -18.648.750 | |
| Effective Tax Rate | 50% | 50% | 60% | |
| Net Revenue | 22.818.591 | 29.019.521 | 12.276.554 | |
| EBITDA | 6.023.277 | 15.401.954 | 2.036.979 | |
| EBITDA Margin | 13% | 27% | 7% | |
| Amortization and Depreciation | -5.861.244 | -5.569.208 | -4.380.054 | |
| Financial Costs | -1.216.439 | -1.196.520 | -1.257.330 | |
| Net Result of the Segment | -1.054.406 | 8.636.226 | -3.600.405 | |
| Other Segments Operating Results | -1.520.034 | |||
| Consolidated net result of the year | 2.461.381 | |||
case of Casino da Póvoa achieve a 60% effective tax rate over game revenues for the period ended September 2015, proving once more the high and inadequate levels of taxation over game revenues given
the current situation of the Portuguese casinos.
Therefore, It will be prudent and realistic to foresee the continuation of moderate and gradual recovery of activity levels and operational results generated by the Group casinos, conditioned by the need to continue the consolidation budget process as well as the reduction of the Group financial bank debt.
| Sep - 2015 | Sep - 2014 | Var % | |
|---|---|---|---|
| EBITDA | |||
| - Casino Estoril | 6.023.277 | 7.088.270 | -15,0% |
| - Casino Lisboa | 15.401.954 | 14.374.459 | 7,1% |
| - Casino Póvoa | 2.036.979 | -673.918 | 402,3% |
| Net Result | |||
| - Casino Estoril | -1.054.406 | -657.683 | -60,3% |
| - Casino Lisboa | 8.636.226 | 6.900.571 | 25,2% |
| - Casino Póvoa | -3.600.405 | -6.385.564 | 43,6% |
During the first quarter of 2013, after a unanimous vote taken at the headquarters of the Portuguese Association of Casinos as well as within the Board of Estoril-Sol, the operating companies from the Group Estoril-Sol, have filed lawsuits against the State in which they seek to be restored the financial balance of Gaming Concessions. Such a claim is founded, among other reasons, because the State, through its actions and omissions has given rise to changes in circumstances that were the basis for the negotiation of the gaming concessions. Of them highlights the fact that it was assumed for tax basis a continuing and significant increase of gaming revenue throughout the concession period. Despite not having checked this proposition due to the economic climate and as a result of the State attitude in relation to online gambling and illegal gambling, among others, it continued to require them to pay very high taxes, calculated on revenue that the Concessionaires did not obtain. Thus, remained no alternative to the Concessionaires that was not to challenge with the competent Administrative and Fiscal Courts the settlements of tax to which they were presented, and for that purpose submit the necessary judicial guarantees. However by the time of approval of this report, and despite the fact that all tax settlements were contested by the Group, all taxes are without exception, or paid or its payment was legally postponed under Decree-Law 1/2015, and for this reason the Group Estoril-Sol does not have any overdue debt related with game taxes.
On the 28th June 2015 the online gambling regulation approved by decree-law 66/2015 entered into force. This regulation now applicable, approved by the Government, represents, once again, a penalty to the gambling concessionaires unilaterally terminating the exclusive right of exploitation of games of fortune and chance in Portugal, - a right by which the concessionaires paid considerable sums and assumed significant additional obligations - the law published, puts them in equal circumstances as the offenders of the past who, in the meantime, managed to illegally build their customer database, key factor to ensure the success of this business, being noticeable by the studies conducted, that the current gambling concessionaires little or nothing would be able to benefit, in the future, from the law deliberated in the meantime, in order to balance their operating accounts.
Between the 30 th of September 2015 and the date of this report, no relevant facts occurred that could materially affect the financial position and the future results of Estoril-Sol, SGPS,S.A. and the other Companies of the Group.
The Board of Directors
Stanley Hung Sun Ho
Mário Alberto Neves Assis Ferreira
Huen Wing Ming, Patrick
Ho Chiu king, Pansy Catilina
So Shu Fai, Ambrose
Man Hin Choi
António José de Melo Vieira Coelho
Vasco Esteves Fraga
Jorge Armindo de Carvalho Teixeira
Calvin Ka Wing Chann
Miguel António Dias Urbano de Magalhães Queiroz
On 30th September 2015, ESTORIL SOL, S.G.P.S., S.A. held 62,565 treasury shares, and as FINANSOL - SOCIEDADE DE CONTROLO, S.G.P.S., S.A., on 30th September 2015, held 6,930,604 shares of ESTORIL-SOL, S.G.P.S., S.A., it was a direct holder of 58.1% of the share capital and of the voting rights.
The members of the Board of Directors and of the Advisory Board of the Companies which are controlled by or grouped under ESTORIL-SOL, held 255,698 shares of ESTORIL-SOL, S.G.P.S., S.A., corresponding to 2.1% of the share capital and voting rights.
Therefore, in overall terms, the direct and indirect stake of FINANSOL in the capital of ESTORIL-SOL is 60.2%, which is identical to the percentage of votes.
On 30th September 2015, ESTORIL-SOL, S.G.P.S., S.A. held 62,565 treasury shares, and, as AMORIM – ENTERTAINMENT E GAMING INTERNATIONAL, S.G.P.S., S.A. held 3,917,793 shares, this company was a direct holder of 32.8% of the share capital and of the voting rights of ESTORIL SOL, S.G.P.S., S.A..
The Companies Briargrove Limited and Nyland Limited as well as the respective "beneficial owners", Srs. Joaquim Ferreira de Amorim, José Américo Amorim Coelho and António Ferreira de Amorim, held 361,500 shares of ESTORIL-SOL, S.G.P.S., S.A., corresponding to 3.0% of the share capital and voting rights.
Therefore, in overall terms, the direct and indirect stake of AMORIM - ENTERTAINMENT E GAMING INTERNATIONAL, S.G.P.S., SA in the share capital of ESTORIL-SOL, S.G.P.S., S.A. was, on 30th September 2015, 35.9% which is identical to the percentage of votes.
| ASSETS | Notes | Sep - 15 | Dec - 14 | |
|---|---|---|---|---|
| NON-CURRENT ASSETS: | ||||
| Tangible fixed assets | ||||
| Reversible to the State | 10 | 48.523.038 | 53.813.029 | |
| Not reversible to the State | 10 | 58.336.739 | 60.158.213 | |
| Tax deductions on investments | - | (17.858.135) | (19.632.477) | |
| Total non-current assets | 89.001.642 | 94.338.765 | ||
| Intangible assets | 11 | 69.599.554 | 78.393.135 | |
| Investment properties | - | 205.734 | 209.897 | |
| Other non current assets | - | 29.636 | 24.541 | |
| 158.836.566 | 172.966.338 | |||
| CURRENT ASSETS: | ||||
| Inventories | - | 6.741.831 | 6.768.436 | |
| Accounts receivable - trade | - | 79.944 | 409.769 | |
| Other accounts receivable | - | 1.475.236 | 1.051.218 | |
| Cash and cash equivalents | 12 | 8.816.359 | 10.045.442 | |
| Total current assets | 17.113.370 | 18.274.865 | ||
| Total assets | 175.949.936 | 191.241.203 | ||
| EQUITY and LIABILITIES | ||||
| EQUITY: | ||||
| Capital | 13 | 59.968.420 | 59.968.420 | |
| Treasury shares | 13 | (708.306) | (708.306) | |
| Issue premiuns | 13 | 7.820.769 | 7.820.769 | |
| Legal Reserves | 6.614.782 | 6.614.782 | ||
| Other Reserves and Retained earnings | (7.265.176) | (5.528.891) | ||
| Consolidated net profit | 2.461.381 | (1.736.283) | ||
| Total equity | 68.891.871 | 66.430.491 | ||
| LIABILITIES: | ||||
| NON-CURRENT LIABITIES: | ||||
| Financial debt | 14 | 5.936.159 | 8.948.862 | |
| Other accounts payable | 15 | 3.734.424 | 3.734.424 | |
| Provisions | 16 | 7.038.019 | 6.466.592 | |
| Total non-current liabilities | 16.708.601 | 19.149.878 | ||
| CURRENT LIABILITIES: | ||||
| Financial debt | 14 | 57.422.766 | 75.045.853 | |
| Other accounts payable | 15 | 32.926.698 | 30.614.981 | |
| Total current liabilities | 90.349.464 | 105.660.834 | ||
| Total liabilities | 107.058.065 | 124.810.712 | ||
| Total equity and liabilities | 175.949.936 | 191.241.203 |
| 30th September | 3rd Quarter | ||||
|---|---|---|---|---|---|
| Notes | 2015 | 2014 | 2015 | 2014 | |
| REVENUE: | |||||
| Gaming revenues | 6 | 134.766.211 | 125.311.582 | 46.668.477 | 43.648.286 |
| Gaming taxes | 6 | (70.651.546) | (67.590.519) | (23.905.233) | (23.203.497) |
| 64.114.665 | 57.721.063 | 22.763.245 | 20.444.789 | ||
| Other operating revenue | 6 | 6.533.159 | 5.031.362 | 2.394.113 | 1.819.253 |
| 70.647.824 | 62.752.425 | 25.157.358 | 22.264.042 | ||
| OPERATING EXPENSES: | |||||
| Cost of sales | - | (1.983.598) | (1.751.638) | (706.750) | (599.990) |
| Supplies and external services | 7 | (20.011.395) | (17.390.880) | (7.191.723) | (6.020.861) |
| Wages and salaries | 8 | (23.726.450) | (22.329.557) | (8.145.562) | (7.495.620) |
| Depreciation and amortization | - | (15.987.429) | (15.731.676) | (5.465.786) | (5.189.246) |
| Impairments - accounts receivable ( (increases) / reversals ) | (110.529) | (105.881) | (30.164) | (43.554) | |
| Provisons ( (increases) / reversals ) | 16 | (665.114) | 209.538 | (67.114) | 5 |
| Impairment of non-depreciable / amortizable investments | - | (7.999) | (2.937) | (3.254) | - |
| Other indirect taxes | - | (255.456) | (284.210) | (88.442) | (76.337) |
| Other operating expenses | - | (1.678.724) | (1.213.636) | (613.629) | (332.701) |
| Total operating expenses | (64.426.694) | (58.600.877) | (22.312.424) | (19.758.304) | |
| Income before financial results and taxes | 6.221.130 | 4.151.548 | 2.844.933 | 2.505.738 | |
| FINANCIAL (LOSSES) AND GAINS: | |||||
| Financial losses | 9 | (3.725.690) | (5.174.163) | (1.127.233) | (1.606.198) |
| Financial gains | 9 | 16.641 | 21.569 | 6.221 | 7.850 |
| (3.709.049) | (5.152.594) | (1.121.013) | (1.598.348) | ||
| Income before taxes | 2.512.081 | (1.001.046) | 1.723.921 | 907.390 | |
| Income taxes | - | (50.700) | (45.500) | (42.000) | (24.500) |
| CONSOLIDATED NET INCOME | 5 | 2.461.381 | (1.046.546) | 1.681.921 | 882.890 |
| Attributable to: | |||||
| Equity holders of the parent Acionistas da empresa mãe |
2.461.381 | (1.046.546) | 1.681.921 | 882.890 | |
| Net result per share | 17 | 0,21 | (0,09) | 0,14 | 0,07 |
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE PERIODS ENDED 30th SEPTEMBER 2015 AND 2014
(Amounts in Euros)
| Share Capital |
Treasury Shares |
Issue Premiums | Legal Reserve | Other Reserves and Retained Earnings |
Consolidated net result of the year |
Total Equity |
|
|---|---|---|---|---|---|---|---|
| Balance at 01st January 2014 | 59.968.420 | (708.306) | 7.820.769 | 6.614.782 | (5.088.770) | (889.120) | 67.717.775 |
| Application of the net profit of the year ended 31st December 2013 |
- | - | - | - | (889.120) | 889.120 | - |
| Consolidated Other Comprehensive Income (OCI) of the period ended 30th September 2014 |
- | - | - | - | - | (1.046.546) | (1.046.546) |
| Balance at 30th September 2014 | 59.968.420 | (708.306) | 7.820.769 | 6.614.782 | (5.977.890) | (1.046.546) | 66.671.229 |
| Balance at 01st January 2015 | 59.968.420 | (708.306) | 7.820.769 | 6.614.782 | (5.528.891) | (1.736.283) | 66.430.491 |
| Application of the net profit of the year ended 31st December 2014 |
- | - | - | - | (1.736.283) | 1.736.283 | - |
| Consolidated Other Comprehensive Income (OCI) of the period ended 30th September 2015 |
- | - | - | - | - | 2.461.381 | 2.461.381 |
| Balance at 30th September 2015 | 59.968.420 | (708.306) | 7.820.769 | 6.614.782 | (7.265.176) | 2.461.381 | 68.891.871 |
| 30th September | 3rd Quarter | ||||
|---|---|---|---|---|---|
| Notes | 2015 | 2014 | 2015 | 2014 | |
| OPERATING ACTIVITIES: | |||||
| Receipts from clients | 138.586.513 | 128.298.178 | 48.193.189 | 44.593.603 | |
| Payments to suppliers | (23.104.824) | (21.811.277) | (7.126.564) | (6.172.763) | |
| Payments to staff | (20.046.374) | (19.071.401) | (6.458.698) | (6.120.968) | |
| Cash flow generated by operations | 95.435.315 | 87.415.500 | 34.607.928 | 32.299.872 | |
| Payment of income tax | (192.625) | (71.152) | - | - | |
| Payment of Special Gaming tax | (65.158.650) | (65.891.101) | (18.288.363) | (16.884.185) | |
| Other payments relating to the operating activity | (3.799.638) | (3.236.573) | (1.515.466) | (1.042.554) | |
| Cash flow from operating activities (1) | 26.284.403 | 18.216.674 | 14.804.099 | 14.373.133 | |
| INVESTING ACTIVITIES: | |||||
| Receipts from: | |||||
| Interest and similar income | 16.641 | 21.568 | 6.221 | 7.850 | |
| 16.641 | 21.568 | 6.221 | 7.850 | ||
| Payments in respect of: | |||||
| Tangible fixed assets | (2.929.364) | (3.600.823) | (1.764.362) | (1.731.086) | |
| (2.929.364) | (3.600.823) | (1.764.362) | (1.731.086) | ||
| Cash flow from investment activities (2) | (2.912.723) | (3.579.255) | (1.758.142) | (1.723.236) | |
| FINANCING ACTIVITIES: | |||||
| Receipts from: | |||||
| Bank loans obtained | 395.711.892 | 347.296.045 | 90.700.162 | 114.017.721 | |
| 395.711.892 | 347.296.045 | 90.700.162 | 114.017.721 | ||
| Payments in respect of: | |||||
| Bank loans repaid | (416.547.603) | (358.407.830) | (102.135.094) | (125.359.545) | |
| Interest and similar costs | (3.759.848) | (5.165.977) | (1.062.294) | (1.466.503) | |
| Amortization of finance leasing contracts | - | (30.370) | - | (219) | |
| (420.307.450) | (363.604.177) | (103.197.388) | (126.826.267) | ||
| Cash flow from financing activities (3) | (24.595.559) | (16.308.132) | (12.497.226) | (12.808.546) | |
| 548.732 | |||||
| Variation in cash and cash equivalents (4)=(1)+(2)+(3) | 12 | (1.223.879) 10.040.238 |
(1.670.713) 9.654.693 |
8.267.627 | (158.649) 8.142.629 |
| Cash and cash equivalents at the start of the period Cash and cash equivalents at the end of the period |
12 | 8.816.359 | 7.983.980 | 8.816.359 | 7.983.980 |
| The notes form an integral part of these financial statements | |||||
| 19 |
This page is deliberately left blank
The Estoril Sol Group, through its subsidiary and associated companies (Note 4), conducts business in gaming, the restaurant sector, entertainment and also real estate.
Estoril Sol, S.G.P.S, S.A. is the Holding Company of the Estoril Sol Group ("Group") and the shares representing its share capital are admitted for trading on a regulated market - the Euronext – as such, on 1 January 2005 it was obliged to prepare Consolidated Accounts pursuant to article 3 of Regulation (EC) no. 1606/2002, of the European Parliament and of the Council, of 19 July, following the Portuguese government's publication of Decree Law no. 35/2005, article 11.
The attached financial statements were prepared on the assumption of the continuity of operations, based on the books and accounting records of the companies included in the consolidation (Note 4), adjusted to comply with the provisions of the IAS 34 as adopted in the European Union and should be read together with the consolidated financial statements for the year ended 31st December 2014. The interim financial information now disclose was not subjected to an external audit or limited review.
During the period ended on 30 th September 2015, there were no changes in accounting policies in relation to those used in the preparation and presentation of the financial statements of the year ended on 31st December 2014, nor were any material errors recognised relating to previous periods.
The companies included in the consolidation, their registered offices, the method of consolidation adopted and the proportion of the capital effectively held on 30 th September 2015 and 31st December 2014 are the following:
| Effective percentage | ||||
|---|---|---|---|---|
| Method of | of the capital held | |||
| Name | Head office | Consolidation | Sep-15 | Dec-14 |
| Estoril-Sol, S.G.P.S., S.A. | Estoril | Integral | Holding. Co. | Holding. Co. |
| Estoril-Sol (III) - Turismo, Animação e Jogo, S.A. | Estoril | Integral | 100 | 100 |
| Varzim Sol - Turismo, Jogo e Animação, S.A. | Póvoa de Varzim | Integral | 100 | 100 |
| Estoril-Sol V - Investimentos Imobiliários, S.A. | Estoril | Integral | 100 | 100 |
| DTH - Desenvolvimento Turistico e Hoteleiro, S.A. | Estoril | Integral | 100 | 100 |
| Estoril-Sol Imobiliária, S.A. | Estoril | Integral | 100 | 100 |
| Estoril-Sol - Investimentos Hoteleiros, S.A. | Estoril | Integral | 100 | 100 |
| Estoril-Sol e Mar - Investimentos Imobiliários, S.A. | Estoril | Integral | 100 | 100 |
| Estoril-Sol Digital, Online Gaming Products and Services, S.A. | Estoril | Integral | 100 | n/a |
ESTORIL-SOL DIGITAL – ONLINE GAMING PRODUCTS AND SERVICES, S.A. – with a Share Capital of EUR 500.000 is 100% held by ESTORIL-SOL (III) –TURISMO, ANIMAÇÃO E JOGO, S.A.
The Company was founded in September 2015 in order to apply for an online gaming license. As described in point 5 "Relevant Facts" of Management Report, the Group Estoril-Sol disagrees with the regulation now applicable for online gambling which represents a penalty to the gambling concessionaires as it unilaterally terminates the exclusive right of exploitation of games of fortune and chance in Portugal.
Estoril-Sol, SGPS, S.A. indirectly holds 33.33% of the company Parques do Tamariz, S.A., through Estoril Sol Imobiliária, S.A.
These holdings are presented at the value resulting from the equity pick-up method. Using this method, the financial statements include the part attributable to the Estoril Sol Group of the results recognised from the date on which the significant influence starts up to the date on which it effectively ends. Associate companies are entities in which the Estoril Sol Group has between 20% and 50% of the voting rights, or in which the Group has significant influence.
The segments reportable by the Group are based on the identification of segments in line with the financial information that is reported internally to the Board of Directors and which supports the Board in its evaluation of the performance of the businesses and in taking decisions with regard to the allocation of the resources to be used. The segments identified by the Group for reporting by segments, are therefore consistent with the way in which the Board of Directors analyses its business, corresponding to the Estoril Gaming Concession the Estoril Casino and Lisbon Casino, Póvoa Casino and Others (essentially including the effect of the holding companies and of the other operating activities of the Group).
| September - 2015 | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Estoril Game Concession | ||||||||||
| Estoril | Lisboa | Póvoa | ||||||||
| Casino | Casino | Sub-Total | Casino | Other | Total | |||||
| Net assets | 43.568.635 | 81.246.939 | 124.815.573 | 45.045.225 | 6.089.138 | 175.949.936 | ||||
| Net liabilities | 31.821.691 | 36.421.815 | 68.243.506 | 33.924.930 | 4.889.629 | 107.058.065 | ||||
| Result of the segment | (1.054.406) | 8.636.226 | 7.581.820 | (3.600.405) | (1.520.034) | 2.461.381 | ||||
| Investment assets: | ||||||||||
| - tangible fixed | 868.406 | 717.201 | 1.585.607 | 1.580.662 | - | 3.166.269 |
On 30th September 2015 and 2014, the information by business segment, is as follows:
| September - 2014 | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Estoril Game Concession | |||||||||
| Estoril | Lisboa | Póvoa | |||||||
| Casino | Casino | Sub-Total | Casino | Other | Total | ||||
| Net assets | 52.429.931 | 85.086.458 | 137.516.389 | 49.985.062 | 6.288.103 | 193.789.554 | |||
| Net liabilities | 41.326.489 | 44.558.800 | 85.885.289 | 36.552.486 | 4.680.551 | 127.118.326 | |||
| Result of the segment | (657.683) | 6.900.571 | 6.242.888 | (6.385.564) | (903.870) | (1.046.546) | |||
| Investment assets: - tangible fixed |
2.290.602 | 444.057 | 2.734.659 | 1.249.740 | - | 3.984.399 |
The consolidated operating income, in the years ended on 30th September 2015 and 2014, is split in the following manner:
| September - 2015 | ||||||
|---|---|---|---|---|---|---|
| Estoril Game Concession | Póvoa Game Concession |
|||||
| Estoril | Lisboa | Póvoa | Other | |||
| Nature | Casino | Casino | Sub-Total | Casino | Total | |
| Gaming revenues: | ||||||
| - Slot Machines | 34.726.315 | 47.120.070 | 81.846.385 | 25.286.522 | - | 107.132.907 |
| - Table based gaming | 11.146.086 | 11.013.119 | 22.159.205 | 5.693.004 | - | 27.852.209 |
| - Progressive games prizes | (117.610) | (47.074) | (164.684) | (54.222) | - | (218.906) |
| 45.754.791 | 58.086.115 | 103.840.906 | 30.925.304 | - | 134.766.210 | |
| Gaming taxes: | ||||||
| - Special Gaming Tax (current) | (22.936.201) | (29.066.595) | (52.002.795) | (15.489.763) | - | (67.492.558) |
| - Annual Gaming Tax ( difference to minimum grant ) |
- | - | - | (3.158.987) | - | (3.158.987) |
| (22.936.201) | (29.066.595) | (52.002.795) | (18.648.750) | - | (70.651.545) | |
| Other operating revenues: | ||||||
| - F&B and Entertainment | 2.914.241 | 381.964 | 3.296.205 | 603.957 | - | 3.900.162 |
| - Tax deductions - Entertainment | 819.000 | 549.000 | 1.368.000 | 1.023.191 | - | 2.391.191 |
| - Supplementary income | 174.178 | 34.242 | 208.419 | 15.693 | - | 224.112 |
| - Other | 16.463 | 0 | 16.463 | 1.231 | - | 17.694 |
| 3.923.882 | 965.206 | 4.889.087 | 1.644.072 | - | 6.533.159 | |
| 26.742.472 | 29.984.726 | 56.727.198 | 13.920.626 | 70.647.824 | ||
| - |
| September - 2014 | ||||||
|---|---|---|---|---|---|---|
| Estoril Game Concession | Póvoa Game | |||||
| Concession | ||||||
| Estoril | Lisboa | Póvoa | Other | |||
| Nature | Casino | Casino | Sub-Total | Casino | Total | |
| Gaming revenues: | ||||||
| - Slot Machines | 32.978.059 | 45.720.379 | 78.698.438 | 22.991.872 | - | 101.690.310 |
| - Table based gaming | 10.971.092 | 8.759.390 | 19.730.482 | 3.922.285 | - | 23.652.767 |
| - Progressive games prizes | (5.901) | (3.454) | (9.355) | (22.141) | - | (31.496) |
| 43.943.250 | 54.476.315 | 98.419.565 | 26.892.016 | - | 125.311.581 | |
| Gaming taxes: | ||||||
| - Special Gaming Tax (current) | (21.974.576) | (27.239.885) | (49.214.461) | (13.457.079) | - | (62.671.540) |
| - Annual Gaming Tax ( difference to minimum grant ) |
- | - | - | (4.918.980) | - | (4.918.980) |
| (21.974.576) | (27.239.885) | (49.214.461) | (18.376.059) | - | (67.590.520) | |
| Other operating revenues: | ||||||
| - F&B and Entertainment | 2.333.072 | 415.803 | 2.748.875 | 442.148 | - | 3.191.023 |
| - Tax deductions - Entertainment | 855.000 | 540.000 | 1.395.000 | 269.141 | - | 1.664.141 |
| - Supplementary income | 134.846 | 34.942 | 169.788 | - | - | 169.788 |
| - Other | 3.253 | 779 | 4.032 | 2.379 | - | 6.411 |
| 3.326.171 | 991.524 | 4.317.695 | 713.668 | - | 5.031.363 | |
| 25.294.845 | 28.227.954 | 53.522.799 | 9.229.625 | - | 62.752.424 |
Income from the segments comes from transactions with external customers. There are no transactions between segments. The accounting policies of each segment are the same as those of the Group.
In the periods ended on 30th September 2015 and 2014, external supplies and services were as follows:
| Set - 2015 | Set - 2014 | |
|---|---|---|
| Gifts to customers | 3.104.971 | 3.053.362 |
| Subcontracts | 2.365.407 | 1.444.814 |
| Energy and other fluids | 2.195.236 | 2.134.012 |
| Conservation and repairs | 1.972.326 | 1.742.954 |
| Cleaning and laundry | 1.699.613 | 1.736.543 |
| Specialized work | 1.602.227 | 995.249 |
| Royalties | 1.496.152 | 1.757.453 |
| Advertising | 1.414.513 | 561.858 |
| Surveillance and security | 1.193.047 | 1.118.884 |
| Other | 824.967 | 768.091 |
| Rents | 815.898 | 964.877 |
| Insurance | 487.128 | 305.225 |
| Communication | 390.496 | 193.899 |
| Fees | 299.711 | 473.282 |
| Travel and hotels | 149.704 | 140.379 |
| 20.011.395 | 17.390.880 |
The most relevant changes occurred in "subcontracts" and "advertising" related to investments made in the animation and entertainment areas of the casinos operated by the Group, with special focus on Casino Estoril.
In the periods ended on 30th September 2015 and 2014, staff costs were as follows:
| Sep - 2015 | Sep - 2014 | |
|---|---|---|
| Remuneration of governing bodies | 2.163.973 | 2.224.723 |
| Remuneration of staff | 15.749.304 | 14.805.421 |
| Indemnities | 78.529 | 4.097 |
| Charges on remuneration | 4.171.959 | 3.991.978 |
| Insurance | 198.759 | 250.520 |
| Social charges | 699.884 | 567.969 |
| Other | 439.041 | 484.849 |
| 23.726.450 | 22.329.557 |
Financial costs and income for the periods ended on 30th September 2015 and 2014 is broken down as follows:
| Financial Costs | Sep - 2015 | Sep - 2014 |
|---|---|---|
| Interest borne: | ||
| Financing from banks | (2.420.598) | (3.806.283) |
| Finance and operating leasing | (57.933) | (65.661) |
| (2.478.531) | (3.871.944) | |
| Other financing costs: | ||
| Comissions and similar charges | (962.710) | (1.000.146) |
| Other financial costs | (284.448) | (302.073) |
| (3.725.690) | (5.174.163) | |
| Financial Income | Sep - 2015 | Sep - 2014 |
| Interests from bank deposits | - | - |
| Exchange gains | 11.863 | 13.046 |
| Other | 4.778 | 8.523 |
| 16.641 | 21.569 | |
| Net financial costs | (3.709.049) | (5.152.593) |
During the periods ended on 30th September 2015 and 2014, the movement in tangible assets, as well as in the respective depreciation and accumulated impairment losses, was as follows:
| Land | Buildings and other constructions |
Basic equipment |
Vehicles | Office equipment |
Other tangible fixed assets |
Fixed assets in progress |
Total |
|---|---|---|---|---|---|---|---|
| 16.513.836 | 197.253.396 | 113.891.718 | 66.744 | 3.928.055 | 82.292 | 364.823 | 332.100.864 |
| - | - | 2.780.159 | - | 33.321 | - | 352.789 | 3.166.269 |
| - | - | 113.456 | - | - | - | - | |
| - | - | (669.347) | - | (4.299) | - | - | (673.646) |
| 16.513.836 | 197.253.396 | 116.115.986 | 66.744 | 3.957.077 | 82.292 | 604.156 | 334.593.487 |
| Depreciation and accumulated | |||||||
| - | 121.688.433 | 92.786.527 | 35.476 | 3.538.941 | 80.249 | - | 218.129.626 |
| - | 5.843.314 | 4.314.851 | 7.453 | 110.536 | 565 | - | 10.276.719 |
| - | - | - | - | - | - | - | - |
| - | - | (668.461) | - | (4.172) | - | - | (672.633) |
| - | 127.531.747 | 96.432.917 | 42.929 | 3.645.305 | 80.814 | - | 227.733.712 |
| 16.513.836 | 69.721.649 | 19.683.069 | 23.815 | 311.772 | 1.478 | 604.156 | 106.859.777 |
| January to September 2015 | (113.456) |
| January to September 2014 | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Land | Buildings and other constructions |
Basic equipment |
Vehicles | Office equipment |
Other tangible fixed assets |
Fixed assets in progress |
Advance payments on tangible fixed assets |
Total | |
| Gross amount: | |||||||||
| Opening balance Acquisitions |
16.513.836 - |
198.191.877 - |
108.585.852 3.275.296 |
224.740 - |
3.909.864 14.097 |
82.292 - |
1.360.297 615.486 |
- 79.520 |
328.868.758 3.984.399 |
| Disposals | - | - | - | - | - | - | - | - | - |
| Adjustments / Transfers | - | - | 589.517 | - | - | - | (589.517) | (79.520) | (79.520) |
| Write-off | - | - | (1.047.865) | (71.375) | (371) | - | - | - | (1.119.611) |
| Closing balance | 16.513.836 | 198.191.877 | 111.402.800 | 153.365 | 3.923.590 | 82.292 | 1.386.266 | - | 331.654.026 |
| Depreciation and accumulated impairment losses: |
|||||||||
| Opening balance | - | 114.501.693 | 89.328.068 | 131.688 | 3.380.593 | 79.469 | - | - | 207.421.511 |
| Depreciation of the year | - | 6.103.065 | 3.750.832 | 14.140 | 121.181 | 584 | - | - | 9.989.802 |
| Disposals | - | - | - | - | - | - | - | - | - |
| Adjustments / Transfers | - | - | - | - | - | - | - | - | - |
| Write-off | - | - | (1.047.864) | (48.636) | (371) | - | - | - | (1.096.871) |
| Closing balance | - | 120.604.758 | 92.031.036 | 97.192 | 3.501.403 | 80.053 | - | - | 216.314.442 |
| Net amount | 16.513.836 | 77.587.119 | 19.371.764 | 56.173 | 422.187 | 2.239 | 1.386.266 | - | 115.339.584 |
The breakdown of intangible assets on 30th September 2015 and 31st December 2014 is as follows:
| September - 2015 | ||||
|---|---|---|---|---|
| Gross Accumulated |
Net | |||
| Assets | Amortization | Assets | ||
| Estoril Gaming Concession | ||||
| - Casino Estoril | 153.576.455 | (122.515.676) | 31.060.779 | |
| - Casino Lisboa | 30.000.000 | (19.069.949) | 10.930.051 | |
| Póvoa Gaming Concession - Casino da Póvoa | 77.034.109 | (49.425.385) | 27.608.724 | |
| 260.610.564 | (191.011.010) | 69.599.554 |
| December - 2014 | ||||
|---|---|---|---|---|
| Gross Accumulated Net |
||||
| Assets | Amortization | Assets | ||
| 153.576.455 | 35.699.522 | |||
| 30.000.000 | (17.527.092) | 12.472.908 | ||
| 30.220.705 | ||||
| 78.393.135 | ||||
| 77.034.109 260.610.564 |
(117.876.933) (46.813.404) (182.217.429) |
On 30th September 2015 and 31st December 2014, this caption was broken down as follows:
| Sep - 2015 | Dec - 2014 | |
|---|---|---|
| Cash | 7.310.402 | 7.810.732 |
| Bank Deposits: - Immediately avaiable bank deposits - Security deposits (a) |
1.473.509 - |
1.094.265 1.100.000 |
| Other teasury applications Cash and bank deposits |
32.446 8.816.358 |
40.445 10.045.442 |
| Bank overdrafts Cash and cash equivalents |
(67.470) 8.748.888 |
(5.204) 10.040.238 |
(a) – Security deposit hold at a Portuguese financial institution, whose participation by the beneficiary, Turismo de Portugal, I.P., was subjected to the condition that, until January 31st, 2015, the depositary bank had not received from the deposit holder, Varzim-Sol – Turismo, Jogo e Animação, S.A., a bank transfer receipt in favor of Turismo de Portugal, I.P., in the total amount settled as "Special Gaming Tax – Annual Payment" related to the year 2014, in accordance with note 28 from consolidated financial statements. The use/mobilization of this deposit by its beneficiary, Turismo de Potugal, I.P., did not occur has the game concessionaire company, Varzim-Sol – Turismo, Jogo e Animação, paid in accordance with payments schedule all its obligations related with game taxes. The Group Estoril-Sol, by the time of approval of these financial statements, has not any overdue debt towards Turismo de Portugal, I.P.
On 30th September 2015 and 31st December 2014, the share capital of the Company is represented by 11,993,684 shares, of which 6,116,779 are registered shares and 5,876,905 bearer shares, of a nominal unit value of 5 Euros, which confer the right to a dividend.
The share capital issued by the Company on 30th June 2015 and on 31st December 2014 is broken down as follows:
| Sep - 2015 | Dec - 2014 | |
|---|---|---|
| Share capital | 59.968.420 | 59.968.420 |
| Treasury shares | (708.306) | (708.306) |
| Issue premiums | 7.820.769 | 7.820.769 |
| 67.080.883 | 67.080.883 |
The share capital is represented by the following categories of shares:
| Data | Nominal value | No. of shares |
|---|---|---|
| 30th of September 2015 | ||
| Registered | 5€ | 6.116.779 |
| Bearer | 5€ | 5.876.905 |
| 11.993.684 | ||
| 31st of December 2014 | ||
| Registered | 5€ | 6.116.779 |
| Bearer | 5€ | 5.876.905 |
| 11.993.684 |
Treasury shares were acquired by the Company as follows:
| Year of Acquisition | No. Shares | Nominal value | Total nominal | Total premiums | Total |
|---|---|---|---|---|---|
| 2001 | 34.900 | 5 | 174.500 | 280.945 | 455.445 |
| 2002 | 43 | 5 | 215 | 184 | 399 |
| 2007 | 22 | 5 | 110 | 88 | 198 |
| 2008 | 27.600 | 5 | 138.000 | 114.264 | 252.264 |
| Total | 62.565 | 312.825 | 395.481 | 708.306 |
Legal persons with more than a 20% holding in the share capital:
Finansol, Sociedade de Controlo, S.G.P.S, S.A., with 60.2%
Amorim – Entertainment e Gaming International, S.G.P.S., S.A., with 35.87%.
On 30th September 2015 and 31st December 2014, this caption was broken down as follows:
| Sep - 2015 | Dec - 2014 | |||
|---|---|---|---|---|
| Nature of the financing | Nominal | Balance sheet | Nominal | Balance sheet |
| Value | Value | Value | Value | |
| Non-current financing: | ||||
| - Bank loans | 5.916.610 | 5.916.610 | 8.929.314 | 8.929.314 |
| - Financial leasing | 19.548 | 19.548 | 19.548 | 19.548 |
| 5.936.158 | 5.936.158 | 8.948.862 | 8.948.862 | |
| Current financing: | ||||
| - Bank loans | 3.750.000 | 3.800.261 | 6.825.008 | 6.918.394 |
| - Commercial paper | 39.000.000 | 38.722.726 | 51.500.000 | 51.022.873 |
| - Current accounts | 14.830.100 | 14.830.100 | 17.078.100 | 17.090.547 |
| - Bank overdrafts (Note 12) | 67.470 | 67.470 | 5.204 | 5.204 |
| - Financial leasing | 2.209 | 2.209 | 8.835 | 8.835 |
| 57.649.779 | 57.422.766 | 75.417.147 | 75.045.853 | |
| 63.585.937 | 63.358.924 | 84.366.009 | 83.994.715 |
The average interest rates for financing, borne by the Group, including commissions and other charges, come within an interval of between 4,74% and 6,5%.
Some of the financing operations, mainly bank loans, include commitments to maintain certain financial ratios based on contractually negotiated limits (financial covenants).
These ratios are:
Net Debt / Ebitda;
Financial autonomy.
On the 30 th September 2015 and 31st December 2014, these ratios were according the contractually negotiated limits.
The amount classified as non-current bank loans, for a total amount of 5.916.610 Euros, falls due in accordance with the following schedule:
- 994.075 Euros in 2016; - 3.437.500 Euros in 2017; - 1.485.035 Euros in 2018;
Depending on the operating funds that are freed up, we feel the financial risk to which the associated undertakings are exposed is minimal, and the same understanding has prevailed in the examination carried out by financial institutions, as shown by the fact that assets guarantees are dispensed with for operations under contract.
The amount included in the column "Nominal value" corresponds to the contracted value that is still owing. The column "Balance sheet value" is added to the nominal value of financial charges already incurred but still not due, less interest and or commissions paid in advance.
On 30th September 2015 and 31st December 2014, this caption was broken down as follows:
| Sep - 2015 | Dec - 2014 | |
|---|---|---|
| Other accounts payable - non-current | ||
| Annual payment - Difference to minumum grant | 3.734.424 | 3.734.424 |
| 3.734.424 | 3.734.424 | |
| Other accounts payable - current | ||
| Current suppliers | 3.039.054 | 4.232.540 |
| Suppliers of investments | 273.431 | 174.731 |
| State and Public Sector | ||
| Annual gaming payment | 9.226.000 | 5.592.704 |
| Annual payment - Difference to minumum grant (Note 6) | 3.158.987 | 1.861.170 |
| Special Gaming Tax ( to be paid next month) | 5.625.514 | 9.349.507 |
| Social Security contribuitons | 594.429 | 568.323 |
| Other in favour of the State | 719.792 | 820.042 |
| Charges with holidays payable | 4.340.950 | 3.529.197 |
| Responsabilities for accumulated gaming premiums | 1.778.782 | 1.559.711 |
| Other | 4.169.759 | 2.927.056 |
| 32.926.698 | 30.614.981 |
The Decree Law n º 29/88 of 3 August, down in paragraph 1 of Article 3, the concessionaire is obliged to pay an annual payment amounting to 50% of the gross gaming revenues. This payment cannot be, under any circumstances, lower than the values in the table attached to that Decree Law.
The minimum annual contributions were established (prices of the year 2000) by Decree-Law No. 275/2001 of 14 December 2001, by the time the Concessions Contracts were extended by fifteen years more.
At the beginning of the year 2015 the Regulatory-Decree nº1/2015 of 21st January came to approve the split payment in installments of the annual minimum contributions calculated based on Decree-Law 275/2001, subject to prior approval from "Turismo de Portugal" of the payments schedule proposed by the Game Concessionaire Companies.
The Regulatory-Decree nº1/2015 was applied for the first the time to the amounts related to the year ended December 2014, which initially payment deadline was on January 31st, 2015.
The value of Casino da Póvoa minimum annual payment for the year 2014 at 2000 current prices, is 17.946.748 Euros. According to Article 4 of the Decree n º 29/88 of 3rd August this value is updated based on the index of consumer prices for the mainland, excluding housing, published by the National Statistics Institute (INE), for the year to which the payment relates to. Following this update, the minimum annual payment for the year 2014 stood at 24.207.299 Euros.
In 2014 Casino da Póvoa gross gaming revenues amounted to 37.223.409 Euros. The 50% annual payment over gross gaming revenues represents 18.611.704 Euros, a figure lower than the minimum annual payment calculated pursuant to Decree-Law No. 275/2001. By that reason the Casino da Póvoa Concessionaire would have to pay to the state the remaining amount in the total of 5,595,595 Euros for the year 2014. (Note 6). Of this amount, 1,861,170 Euros are at the date of this report settled by the Concessionaire Company since they had the maturity date on January 31st, 2015. The remaining 3,734,424 Euros registered in the caption "Other accounts payable – non-current", and according to prior authorization from Turismo de Portugal will be paid in three equal annual instalments, on December 31st, 2019, 2020 and 2021.
During the periods ended on 30th September 2015 and 2014 the movement in provisions was as follows:
| From January to September 2015 | |||||
|---|---|---|---|---|---|
| Opening Balance |
Increases | Reversals | Writte-off | Closing Balance |
|
| Provisions for pensions | 3.388.396 | 225.000 | - | (37.409) | 3.575.987 |
| Legal proceedings in hand | 2.203.481 | 594.293 | - | (281.277) | 2.516.497 |
| Other risks and charges | 874.715 | 92.025 | (21.205) | - | 945.535 |
| 3.078.196 | 686.318 | (21.205) | (281.277) | 3.462.032 | |
| TOTAL | 6.466.592 | 911.318 | (21.205) | (318.686) | 7.038.019 |
During the first nine months of 2015 new provisions were made in the total amount of 686.318€, 594.293€ related with new lawsuits for employment litigations and 92.095€ related with possible fiscal matters, namely IRC divergences between the Group and the Tax Authorities.
| From January to September 2014 | |||||
|---|---|---|---|---|---|
| Opening Balance |
Increases | Reversals | Writte-off | Closing Balance |
|
| Provisions for pensions | 3.672.252 | - | - | (44.892) | 3.627.360 |
| Legal proceedings in hand | 2.229.614 | - | - | (66.027) | 2.163.587 |
| Other risks and charges | 1.055.385 | - | (209.538) | - | 845.847 |
| 3.284.999 | - | (209.538) | (66.027) | 3.009.434 | |
| TOTAL | 6.957.251 | - | (209.538) | (110.919) | 6.636.794 |
During the first nine months of 2014 it had been reversed 209.538 Euros, a provision originally constituted to cover liabilities directly related to headcount restructuring processes of the Company's subsidiaries and whose initial estimate it turned to be overestimated.
In the normal course of its activity, the Group is involved in diverse legal proceedings. Given the nature of these and the provisions set up, in accordance with studies and opinions of legal consultants, the current expectation is that the respective outcome will not lead to any material effects in terms of the activity undertaken, the asset position and the result of the operations.
The main situations are the following:
Even so, on this date the Group has bank guarantees provided in favour of the Finance Office of Cascais amounting to 7.197.635 Euros.
The Group also sets up diverse technical provisions related with the normal functioning of its main activity, the operation of games of fortune. Among the more significant ones we should highlight:
On 30 th September 2015 and 31st December 2014 the guarantees provided by the Group were as follows:
| Seo - 2015 | Dec - 2014 | |
|---|---|---|
| Obligations related with the Special Gaming Tax | 6.650.000 | 13.150.000 |
| Tax lawsuits in hand / litigation | 7.414.888 | 7.429.989 |
| Current suppliers | 39.250 | 39.250 |
| 14.104.138 | 20.619.239 |
In January 2015 the Group saw its responsabilities with bank guarantees reduced by 6,5 million Euros, as they were related with the Special Game Tax from the year ended 31st December 2014 paid during January 2015.
The consolidated result per basic share of the years ended on 30th September 2015 and 2014 was determined as follows:
| Sep - 2015 | Sep - 2014 | |
|---|---|---|
| Consolidated net profit of the period | 2.461.381 | (1.046.546) |
| Average weighted number of shares in circulation | 11.931.119 | 11.931.119 |
| Result per basic share | 0,21 | (0,09) |
Due to the fact that there are no situations that cause dilution, the net result per diluted share is the same as the net result per basic share.
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