Management Reports • Nov 30, 2012
Management Reports
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The Consolidated Financial Information contained in this report was unaudited and has been prepared in accordance with International Financial Reporting Standards (IAS/IFRS) issued by the International Accounting Standards Board (IASB), as adopted by the European Union.
| 0. Our business4 |
|---|
| 1. Consolidated Results 5 |
| Optimus7 |
| Optimus Mobile Business7 |
| Operational data8 |
| 2.1.2. Financial data9 |
| Optimus wireline Business 9 |
| 2.2.1. Operational data9 |
| 2.2.2. Financial data 10 |
| Software and Information Systems (SSI) 11 |
| Operational data 11 |
| Financial data 12 |
| Online & Media 13 |
| Main regulatory developments in 9M12 14 |
| developments in 9M12 14 |
| 7. Other Indicators16 |
| 19 |
| 19 |
| 27 |
| 80 |
| 87 |
"Over the course of the current quarter, we have witnessed the intensification of austerity measures in Portugal, with increasing impact on consumer behaviour resulting in the reduction or rationalisation of their telecom-based expenses.
Sonaecom has reacted to these impacts by focusing our efforts on achieving productivity gains based on our creativity and ability to innovate. This has allowed us to maintain our levels of customer service and profitability, which we believe are sustainable, and position ourselves as one of the best mobile operators in Europe."
Ângelo Paupério, CEO, Sonaecom
At Optimus, we emphasise the progress on the 4G front. Pursuing this year's goal in terms of coverage, we remain focused on deploying the 4G network wide coverage. Launched in March 2012, our 4G commercial offer not only includes smartphones, but it also includes specially designed 4G dongles and hotspot terminals.
Driven by Optimus's efficiency measures, operating profitability sustained its upward trend. We highlight the 45.1% mobile EBITDA margin the business achieved in 3Q12, 5.9pp above the level it registered in the 3Q11.
At Software and Information Systems (SSI), WeDo Technologies continued to strengthen its global leadership in the revenue assurance telecoms market, complementing its portfolio with fraud management solutions and business assurance in telecoms and other sectors. Although with a small expression in absolute terms, WeDo's revenues outside the telecoms sector increased almost 80% in 9M12.
Portugal's state budget for 2013 heralds an even more challenging macroeconomic environment, with negative consequences in consumer behaviour, expected already for the remainder of 2012. Nevertheless, we remain confident that we will achieve our targets for the current year.
Consolidated turnover in 9M12 totalled 617.0 million euros, 5.1% below 9M11. This evolution was driven by a decrease of 3.7% in service revenues and a decrease of 19.5% in product sales.
Optimus's evolution has been affected by regulated tariffs (mobile termination rates, MTRs, and roaming in) and Portugal's austerity economic environment, which continues to have a negative impact on consumption levels.
The sustained rise in service revenues at SSI during 9M12 was not sufficient to offset the fall in product sales at Bizdirect. This fall resulted from the combined impact of the macroeconomic environment and the termination of the government's e-initiatives programme.
Operating costs stood at 432.7 million euros, down 9.2% compared to 9M11.
The two drivers behind this downward trend are Optimus' optimisation plan, launched in 2009, and the lower cost of goods sold at SSI, consequence of the product sales' evolution. As a result of the ongoing efficiency measures, the company has been able to reduce its cost structure. Our plan is to continue implementing
these measures at Optimus, while focusing on other key areas such as brand awareness, quality of service and customer experience.
Between 9M11 and 9M12, operating costs as a percentage of turnover decreased 3.1pp, meaning that the consolidated top line trend was more than offset thanks to lower operating costs.
Consolidated EBITDA increased 6.0% to 191.1 million euros. Once again, all business divisions showed a positive EBITDA performance between the two periods, with Optimus's mobile business registering the highest growth in absolute terms.
The consolidated EBITDA margin increased 3.3pp from 27.7% to 31.0%.
The net results group share reached 63.9 million euros, growing 12.5% compared to 9M11, driven by the improved EBITDA performance.
The evolution of net financial results was primarily impacted by a higher level of financial expenses, the result of a higher average net debt level and a higher cost of debt.
The tax line in 9M12 showed a cost of 7.1 million euros against 6.2 million euros in the same period of 2011. This came on the back of a higher EBT as we maintained the level of deferred tax assets recognition.
Operating capex grew 22.8% between 9M11 and 9M12. This was impacted mostly by the 4G network deployment at our mobile business, where we made significant progress towards achieving our 2012 target in terms of coverage.
During 3Q12, Optimus continued to adopt solutions that enabled us to optimise mobile backhaul costs while reducing our dependency on rented infrastructure. Accordingly, 80% of
9M11 Mobile Wireline SSI Other & Elim. 9M12 +19.1 +0.1 -1.3 +0.7 82.1 +30.0% +0.4% -43.2% - 100.7
our sites are already connected through own infrastructure, namely fibre, in the most dense areas, and microwaves, in the rural areas.
Operating capex as a percentage of turnover increased 3.7pp, to 16.3%.
Consolidated net debt reached 349.0 million in 9M12, increasing 25.1% compared with 9M11. This rise is mostly due to the 83.0 million euros outflow in January relating to the spectrum we acquired in late 2011.
Despite the positive EBITDA performance, the net debt to EBITDA ratio increased from 1.2x to 1.4x because of a higher net debt level.
In 9M12, total credit facilities amounted to
450.0 million euros while the all-in average cost of debt reached 3.25%.
FCF stood at negative 53.4 million euros in 9M12, impacted by (i) the outflow of 15.0 million euros relating to the securitisation operation; (ii) the 83.0 million euros spectrum payment; and (iii) a payment of 6.0.million euros relating to the acquisition of Connectiv Solutions at the end of April 2012.
Excluding these impacts, 9M12 FCF amounted to 50.6 million euros, an increase of 16.0% compared to the 43.6 million euros achieved in 9M11 (excluding the securitisation payment outflow).
After guaranteeing the ideal combination of three spectrum LTE bands, Optimus is now well advanced on LTE network deployment in the 800Mhz and 1800Mhz bands. It aims to reach 80% coverage by the end of 2012. With this additional strength, Optimus will explore new commercial offers and cost optimisation opportunities, both in the residential and the business segments.
We have been transforming Optimus's operating model to create a far more efficient organisation. Resulting from a transversal plan being implemented across the entire organisation, positive results are now visible company-wide.
During 9M12, Optimus's operating costs decreased 9.3%, a saving of over 35 million euros. At the same time, in line with our goal of leading in terms of satisfaction and market confidence, the business's principal KPIs covering service quality continued to evolve positively.
In September 2012, research undertaken by 'Consumer Choice – Centro de Avaliação da Satisfação do Consumidor' established that Optimus was considered the preferred mobile operator among Portuguese consumers. In particular, the brand is recognised in areas such as the quality and diversity of its services, client support, offers and promotions.
During 9M12, Optimus's mobile customer revenues were significantly impacted by Portugal's harsh macroeconomic conditions, with the effects of the austerity measures noticeable across the principal macroeconomic indicators, including private and public consumption as well as the unemployment rate. Even so, Optimus's mobile business was able to achieve an EBITDA margin of 44.2% in 9M12, a benchmark when it comes to mobile operators in Europe.
| MOBILE OPERATIONAL KPI's | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
|---|---|---|---|---|---|---|---|---|
| Customers (EOP) ('000) | 3,638.6 | 3,566.3 | -2.0% | 3,565.0 | 0.0% | 3,638.6 | 3,566.3 | -2.0% |
| Pre-paid Customers ('000) | 2,423.3 | 2,367.3 | -2.3% | 2,364.3 | 0.1% | 2,423.3 | 2,367.3 | -2.3% |
| Post-paid Customers ('000) | 1,215.3 | 1,199.0 | -1.3% | 1,200.6 | -0.1% | 1,215.3 | 1,199.0 | -1.3% |
| Net Additions ('000) | 52.2 | 1.3 | -97.5% | -44.9 | - | 34.5 | -73.1 | - |
| Data as % Service Revenues | 33.0% | 31.4% | -1.7pp | 32.8% | -1.4pp | 32.4% | 31.8% | -0.6pp |
| Non SMS Data as % Data Revenues | 75.0% | 76.3% | 1.3pp | 76.6% | -0.3pp | 76.3% | 76.4% | 0.2pp |
| Total #SMS/month/user | 42.2 | 41.9 | -0.8% | 41.9 | 0.0% | 42.4 | 41.5 | -2.2% |
| MOU(1) (min.) | 125.9 | 122.6 | -2.7% | 123.4 | -0.7% | 126.2 | 122.7 | -2.7% |
| ARPU(2) (euros) | 13.5 | 12.4 | -7.7% | 12.0 | 3.4% | 13.0 | 12.2 | -6.7% |
| Customer Monthly Bill | 11.6 | 10.9 | -6.0% | 10.6 | 3.1% | 11.3 | 10.7 | -5.2% |
| Interconnection | 1.9 | 1.5 | -18.2% | 1.4 | 5.5% | 1.7 | 1.5 | -16.1% |
| ARPM(3) (euros) | 0.11 | 0.10 | -5.2% | 0.10 | 4.1% | 0.10 | 0.10 | -4.1% |
(1) Minutes of Use per Customer per month; (2) Average Monthly Revenue per User; (3) Average Revenue per Minute.
Optimus' mobile customer base stood at 3.57 million, down 2.0% y.o.y., despite a slight growth in net additions during 3Q12. This reduction was driven by the expected erosion of the e-initiatives programme's customer base and the impact of Portugal's austerity measures, mainly in the personal segment.
Average revenue per user (ARPU) among mobile customers in 9M12 stood at 12.2 euros. In quarterly terms, the 3Q12 ARPU increased slightly compared to 2Q12, having decreased 1.1 euros compared to 3Q11. The fall registered in 9M12
came on the back of lower interconnection revenues, which decreased from 1.7 euros to 1.5 euros; and lower customer monthly bill, which decreased from 11.3 euros to 10.7 euros.
In 9M12, minutes of use (MOU) decreased 2.7% y.o.y. to an average of 123 minutes per month.
Data revenues represented 31.8% of service revenues in 9M12, 0.6pp down compared to 9M11. Although smartphone penetration is still low in Portugal, smartphone adoption has partially offset the impact of the end of the e-initiatives programme on Optimus's data revenues.
The weight of non-SMS related data increased 0.2pp, reaching 76.4% in 9M12.
MOBILE INCOME STATEMENT 3Q11 3Q12 ∆ 12/11 2Q12 q.o.q. 9M11 9M12 ∆ 12/11 Turnover 149.8 137.1 -8.5% 131.0 4.6% 430.2 399.6 -7.1% Service Revenues 141.7 129.6 -8.5% 125.7 3.1% 411.1 382.2 -7.0% Customer Revenues 122.0 113.7 -6.9% 110.6 2.8% 355.9 336.1 -5.6% Operator Revenues 19.6 15.9 -18.9% 15.1 5.2% 55.2 46.1 -16.4% Equipment Sales 8.2 7.5 -8.2% 5.3 40.7% 19.1 17.3 -9.1% Other Revenues 7.2 6.8 -5.7% 7.8 -13.3% 24.2 21.4 -11.6% Operating Costs 98.2 82.0 -16.5% 79.3 3.4% 285.6 244.2 -14.5% Personnel Costs 12.8 10.9 -15.3% 10.1 7.7% 38.6 32.9 -14.7% Direct Servicing Costs(1) 32.3 26.8 -17.0% 28.6 -6.3% 102.3 85.0 -16.9% Commercial Costs(2) 25.1 20.9 -16.7% 13.7 52.1% 61.6 48.2 -21.8% Other Operating Costs(3) 28.0 23.4 -16.3% 26.8 -12.8% 83.0 78.1 -6.0% EBITDA 58.8 61.9 5.2% 59.5 3.9% 168.7 176.7 4.8% EBITDA Margin (%) 39.2% 45.1% 5.9pp 45.4% -0.3pp 39.2% 44.2% 5.0pp Operating CAPEX(4) 23.7 35.1 47.9% 28.1 24.9% 63.8 82.9 30.0% Operating CAPEX as % of Turnover 15.8% 25.6% 9.7pp 21.4% 4.1pp 14.8% 20.8% 5.9pp EBITDA - Operating CAPEX 35.1 26.8 -23.6% 31.5 -14.8% 104.9 93.8 -10.6% Total CAPEX 23.8 35.2 48.2% 29.1 20.9% 63.9 84.1 31.7% Million euros
(1)Direct Servicing Costs =Interconnection and Content + Leased Lines + OtherNetwork Operating Costs; (2) Commercial Costs = COGS + Mktg & Sales Costs; (3)OtherOperating Costs = Outsourcing Services +G&A +Provisions + others; (4)Operating CAPEX excludesFinancial Investments.
Mobile turnover decreased 7.1% in 9M12 to 399.6 million euros, driven by a fall in service revenues and equipment sales. The decline in service revenues was due to a combination of lower customer revenues and lower operator revenues. As we anticipated, customer revenues decreased 5.6% between 9M11 and 9M12 to 336.1 million euros due to the end of the government's e-initiatives programme and due to the negative impact of the austerity on consumption levels, mostly in the personal segment, and the consequent impact on ARPU.
Operator revenues decreased 16.4% between 9M11 and 9M12 to 46.1 million euros because of lower regulated tariffs, MTRs and roaming in.
As a result of Optimus' planned efforts to implement a leaner organisation, mobile operating costs have been decreasing. During 9M12, this line decreased 14.5% y.o.y. to 244.2 million euros, benefiting from (i) a decrease of 14.7% in personnel costs; (ii) a 16.9% decrease in the level of direct servicing costs, due to a lower level of leased lines and network-related costs, as Optimus continues to reduce its dependency on rented infrastructure, and due to lower interconnection costs, driven by lower mobile termination rates; (iii) a 21.8% decrease in commercial costs, due a combination of lower advertising costs and lower costs of goods sold (as a result of lower equipment sales); and (iv) a 6.0% decrease in other operating costs, driven mostly by lower general and administrative costs.
Mobile EBITDA increased 4.8% y.o.y. to 176.7 million euros, wholly driven by a 14.5% decrease in operating costs. The EBITDA margin reached 44.2% in 9M12 against 39.2% in 9M11, an increase of 5.0pp. EBITDA-operating capex decreased 10.6% y.o.y., due entirely to an increase of 30.0% in operating capex, impacted by the 4G network deployment, our main investment focus.
In the enterprise segment, our integrated and convergent positioning among corporates and SMEs is delivering results. At the end of the 3Q12, the percentage of convergent clients in our customer base exceeded 40%, an increase compared to 9M11, while we continued to drive the growth of mobile and wireline services in these segments. In the residential segment, our performance continues to be impacted by the decision to abandon residential customer acquisition over the incumbent's infrastructure, implemented in 2011.
| WIRELINE OPERATIONAL KPI's | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
|---|---|---|---|---|---|---|---|---|
| Total Accesses | 383,568 | 344,619 | -10.2% | 354,449 | -2.8% | 383,568 | 344,619 | -10.2% |
| Corporate and SMEs | 157,637 | 156,897 | -0.5% | 155,143 | 1.1% | 157,637 | 156,897 | -0.5% |
| PTSN/RDIS | 112,769 | 113,181 | 0.4% | 111,039 | 1.9% | 112,769 | 113,181 | 0.4% |
| Broadband | 35,575 | 31,660 | -11.0% | 32,472 | -2.5% | 35,575 | 31,660 | -11.0% |
| Other & Data | 9,293 | 12,056 | 29.7% | 11,632 | 3.6% | 9,293 | 12,056 | 29.7% |
| Residential | 225,931 | 187,722 | -16.9% | 199,306 | -5.8% | 225,931 | 187,722 | -16.9% |
| PTSN/RDIS | 106,400 | 79,467 | -25.3% | 88,147 | -9.8% | 106,400 79,467 | -25.3% | |
| Broadband | 85,399 | 71,243 | -16.6% | 74,229 | -4.0% | 85,399 | 71,243 | -16.6% |
| TV | 34,132 | 37,012 | 8.4% | 36,930 | 0.2% | 34,132 | 37,012 | 8.4% |
| Average Revenue per Access - Retail | 22.5 | 21.6 | -3.9% | 23.4 | -7.4% | 23.5 | 22.7 | -3.5% |
The impact of the prevailing macroeconomic conditions during 2012 created some pressure in the corporate and SMEs segment, resulting in a 0.5% y.o.y. decrease in the number of accesses between 9M11 and 9M12. It also caused a drop of 3.5% in the retail ARPU.
However, it should be noted that, in quarterly terms, the number of accesses increased 1.1% between 2Q12 and 3Q12 to 157 thousand. Besides providing voice and broadband accesses, Optimus also provides an increasing number of eservices (for example: e-fax, e-backup) to the SME segment alongside a growing number of dedicated lines and VPN connections to the corporate segment.
The number of total accesses decreased 10.2% y.o.y. to 345 thousand accesses, mostly driven by a decrease of 16.9% in the residential segment.
Million euros
| WIRELINE INCOME STATEMENT | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
|---|---|---|---|---|---|---|---|---|
| Turnover | 56.6 | 52.9 | -6.5% | 55.4 | -4.4% | 163.5 | 161.7 | -1.1% |
| Service Revenues | 55.4 | 51.6 | -6.8% | 53.8 | -4.1% | 162.1 | 157.8 | -2.7% |
| Customer Revenues | 24.7 | 21.2 | -14.2% | 23.6 | -10.0% | 79.1 | 68.7 | -13.0% |
| Operator Revenues | 30.7 | 30.4 | -1.0% | 30.2 | 0.6% | 83.0 | 89.0 | 7.2% |
| Equipment Sales | 1.2 | 1.3 | 9.2% | 1.6 | -17.6% | 1.4 | 3.9 | 174.9% |
| Other Revenues | 0.3 | 0.2 | -10.7% | 0.4 | -31.3% | 0.7 | 0.8 | 15.3% |
| Operating Costs | 52.9 | 49.1 | -7.3% | 51.8 | -5.3% | 154.1 | 151.4 | -1.8% |
| Personnel Costs | 0.6 | 0.9 | 42.7% | 0.9 | -0.5% | 2.0 | 2.8 | 39.7% |
| Direct Servicing Costs(1) | 40.1 | 37.3 | -6.9% | 37.6 | -0.8% | 113.1 | 112.2 | -0.8% |
| Commercial Costs(2) | 2.0 | 2.2 | 7.1% | 4.0 | -46.0% | 7.0 | 9.7 | 39.6% |
| Other Operating Costs(3) | 10.2 | 8.7 | -14.9% | 9.3 | -6.3% | 32.0 | 26.6 | -16.9% |
| EBITDA | 3.9 | 4.1 | 4.2% | 3.9 | 4.2% | 10.0 | 11.1 | 10.2% |
| EBITDA Margin (%) | 6.9% | 7.7% | 0.8pp | 7.1% | 0.6pp | 6.1% | 6.8% | 0.7pp |
| Operating CAPEX(4) | 3.6 | 6.0 | 65.6% | 5.3 | 12.5% | 15.5 | 15.5 | 0.4% |
| Operating CAPEX as % of Turnover | 6.4% | 11.3% | 4.9pp | 9.6% | 1.7pp | 9.5% | 9.6% | 0.1pp |
| EBITDA - Operating CAPEX | 0.3 | -1.9 | - | -1.4 | -36.2% | -5.4 | -4.5 | 17.7% |
| Total CAPEX | 3.6 | 6.0 | 65.6% | 5.3 | 12.5% | 15.5 | 15.5 | 0.4% |
(1)Direct Servicing Costs= Interconnection and Content + Leased Lines + OtherNetwork Operating Costs; (2) Commercial Costs = COGS + Mktg & Sales Costs; (3)OtherOperating Costs = Outsourcing Services +G&A +Provisions + others; (4)Operating CAPEX excludesFinancial Investments.
Wireline turnover decreased 1.1% y.o.y. to 161.7 million euros despite the upward trend in operator revenues and equipment sales. The increase in operator revenues was a remarkable achievement entirely driven by an increase in traffic levels despite the decrease in wholesale traffic prices.
Wireline operating costs decreased 1.8% y.o.y., to 151.4 million euros. Direct servicing costs decreased 0.8%, mostly due a lower level of leased lines. Other operating costs decreased 16.9%, primarily due to lower outsourcing costs. Commercial costs increased 39.6% due to higher marketing costs and higher cost of goods sold.
Wireline EBITDA increased 10.2% y.o.y., reaching 11.1 million euros. The EBITDA margin increased from 6.1% to 6.8%, growing 0.7pp y.o.y..
EBITDA-operating capex improved 17.7% between the two periods, reaching a negative 4.5 million euros. This was supported mostly by a higher EBITDA, as the operating capex remained stable between the two periods. It should be noted that the operating capex trend during the period was mainly driven by FTTH.
WeDo Technologies, SSI's largest company, continued to expand its international footprint while focusing on the acquisition of new projects in the business assurance market. In July 2012, the company strengthened its presence in the retail sector with the announcement of two new major clients in Europe and the United States. This marks a key milestone since the launch in 2011 of its complete profit protection software platform: RAID RETAIL.
During 9M12, the company's revenues outside the telecommunications sector increased almost 80%.
Presently, WeDo Technologies has more than 150 clients in 80 countries. During 9M12, its international revenues represented 73.3% of its turnover, growing 4.8% compared to 9M11.
Specialising in IT management, security and business continuity, Mainroad successfully increased its service revenues by 2.0%, improving its EBITDA 55.9% between 9M11 and 9M12 despite the challenging market conditions.
Bizdirect's turnover in 9M12 declined 35.7% due to the macroeconomic conditions and the end of the government's einitiatives programme. Given these factors, the company has intensified its focus on areas such as licensing and solutions. Supported by partnerships with the main manufacturers, Bizdirect's position in the global market is improving, with international revenues increasing 11.6% y.o.y..
Saphety strengthened its position as a leading player in providing solutions for simplifying and automating processes to the domestic market. Currently, its international strategy is a major focus for the company, which ended 9M12 with international revenues representing 12.1% of its total turnover.
| SSI OPERATIONAL KPI's | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
|---|---|---|---|---|---|---|---|---|
| IT Service Revenues/Employee(1) ('000 euros) | 32.7 | 35.6 | 9.0% | 34.7 | 2.7% | 97.8 | 103.3 | 5.6% |
| Equipment Sales as % Turnover | 35.1% | 23.4% | -11.7pp | 18.6% | 4.8pp | 35.8% | 22.8% | -13.0pp |
| Equipment Sales/Employee(2) ('000 euros) | 384.0 | 311.4 | -18.9% | 219.3 | 42.0% | 1,191.3 | 834.6 | -29.9% |
| EBITDA/Employee ( '000 euros) | 2.9 | 4.3 | 46.3% | 3.6 | 20.1% | 8.8 | 8.1 | -8.0% |
| Employees | 569 | 622 | 9.3% | 603 | 3.2% | 569 | 622 | 9.3% |
(1) Excluding employees dedicated to Equipment Sales; (2) Bizdirect.
IT service revenues per employee reached 103.3 thousand euros in 9M12, 5.6% above 9M11, with the growth in service revenues more than compensating for the 9.3% increase in headcount.
Driven by Bizdirect's equipment sales, equipment sales as percentage of turnover decreased y.o.y. from 35.8% to 22.8%.
Million euros
| SSI CONSOLIDATED INCOME STATEMENT | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
|---|---|---|---|---|---|---|---|---|
| Turnover | 27.4 | 28.0 | 2.1% | 24.8 | 12.8% | 83.3 | 77.0 | -7.6% |
| Service Revenues | 17.8 | 21.4 | 20.4% | 20.2 | 6.1% | 53.5 | 59.4 | 11.1% |
| Equipment Sales | 9.6 | 6.5 | -31.9% | 4.6 | 42.0% | 29.8 | 17.5 | -41.1% |
| Other Revenues | 0.2 | 0.1 | -31.9% | 0.2 | -37.0% | 0.5 | 0.8 | 83.9% |
| Operating Costs | 25.9 | 25.4 | -1.9% | 22.8 | 11.5% | 78.7 | 70.6 | -10.3% |
| Personnel Costs | 7.7 | 8.6 | 11.8% | 8.1 | 5.2% | 22.6 | 23.8 | 5.3% |
| Commercial Costs(1) | 9.5 | 7.0 | -26.3% | 5.1 | 37.7% | 29.7 | 18.6 | -37.5% |
| Other Operating Costs(2) | 8.8 | 9.9 | 12.6% | 9.6 | 2.6% | 26.3 | 28.2 | 6.9% |
| EBITDA | 1.7 | 2.7 | 59.9% | 2.2 | 23.8% | 5.0 | 7.2 | 43.7% |
| EBITDA Margin (%) | 6.1% | 9.5% | 3.4pp | 8.7% | 0.9pp | 6.0% | 9.4% | 3.3pp |
| Operating CAPEX(3) | 1.1 | 0.7 | -39.7% | 0.2 | 188.7% | 3.0 | 1.7 | -43.2% |
| Operating CAPEX as % of Turnover | 4.2% | 2.5% | -1.7pp | 1.0% | 1.5pp | 3.6% | 2.2% | -1.4pp |
| EBITDA - Operating CAPEX | 0.5 | 2.0 | - | 1.9 | 3.4% | 2.0 | 5.5 | 169.9% |
| Total CAPEX | 1.1 | 0.7 | -39.7% | 10.3 | -93.3% | 3.0 | 11.7 | - |
(1) Commercial Costs =COGS + Mktg & Sales; (2)OtherOperating Costs =Outsourcing Services+ G&A+ Provisions+ others; (3)Operating CAPEXexcludes Financial Investments,
Once again, SSI turnover grew on a quarterly basis, with the rise in service revenues more than offsetting the decline in equipment sales. In 9M12, SSI turnover decreased y.o.y. by 7.6% to 77.0 million euros, impacted by the 41.1% drop in equipment sales at Bizdirect. This fall at Bizdirect is due to the termination of the e-initiatives programme, as well as the negative impact of the macroeconomic environment on businesses in this sector.
Service revenues continued to rise, growing 11.1% y.o.y. as the benefits of the Connectiv Solutions acquisition began to feed through. Since 1 May 2012, Connectiv Solutions' results have been consolidated into SSI's accounts. On a like-forlike basis, service revenues would have grown 5.7% y.o.y..
SSI's operating costs decreased y.o.y. by 10.3% to 70.6 million euros. The 37.5% decrease in the level of commercial costs is primarily a direct result of the lower cost of goods sold at Bizdirect. Personnel costs increased 5.3%, mainly as a result of WeDo Technologies' growth and the integration of Connectiv Solutions' headcount. The increase in other operating costs relates mainly to higher outsourcing costs designed to support the increased number of projects in progress, as reflected in service revenues.
During 9M12, EBITDA reached 7.2 million euros, increasing 43.7% compared to 9M11. This was due to higher service revenues and lower operating costs. As a result of (i) lower equipment sales; (ii) higher service revenues; and (iii) the decrease in operating costs, the EBITDA margin increased y.o.y. from 6.0% to 9.4%, up 3.4pp. Excluding the effect of Connectiv Solutions' consolidation, the EBITDA would have increased 24.5% against 9M11.
From quarter to quarter, Público's presence in the online space continues to expand. As a result, online revenues are rising, but they are still far from offsetting falling revenues from advertising and offline circulation. In fact, during 9M12, the Online & Media advertising revenues decreased compared with the same period in 2011, impacting negatively the EBITDA performance, which stood at a negative 3.15 million euros, down 31.3% on 9M11.
Globally, the printed press has been undergoing a profound structural change for several years. This has resulted in a strong downward trend in revenues, consequence of the substitution effect of the offline by the online. Furthermore, the entire sector in Portugal is suffering the severe impacts of the current economic crisis, both in circulation revenues and in advertising revenues.
Aiming to ensure the sustainability of the business without compromising Público's role as an independent source of information in Portugal, Sonaecom announced the implementation of a restructuring plan at the beginning of October 2012.
This plan involves a stronger focus on the growing demand of the digital world and in reducing the cost structure by about 3.5 million euros per year. This will be driven by a decrease in operating costs and the predictable leave of 48 employees. Sonaecom expects this plan to strengthen Público's strategic focus on digital, while continuing to preserve the brand's values, as it has consistently done over the past 22 years.
ICP-ANACOM launched a public consultation on mobile network operators' obligations towards mobile broadband coverage of parishes presently without or with low mobile broadband coverage. This followed the regulation of the auction for the assignment of rights to use frequencies in the 450 MHz, 800 MHz, 900 MHz, 1800 MHz, 2.1 GHz and 2.6 GHz bands.
The document lists a total of 480 villages to be distributed equally between the three providers: TMN, Vodafone and Optimus.
The process for choosing the villages will be carried out according to the criteria defined in the regulation, meaning that Optimus will be assigned the 160 villages not chosen by Vodafone and TMN.
The government published a law establishing the conditions for the compensation fund to finance the excessive net costs arising from the terms of the US.
According to this law, telecom providers must contribute to the fund if the eligible turnover represents at least 1% of the industry's turnover. The eligible turnover corresponds to the value of sales and services in the national territory, deducted from the revenues of activities not related to provision of electronic communications services, revenues from transactions between entities belonging to the same company, and equipment sales.
The law foresees that the fund should finance the excessive costs of US after the designation of the new US providers through a public tender and also before such a tender is completed.
In accordance with authorisations granted by the Shareholders' General Meeting and for the purpose of fulfilling the obligations arising from the employees' Medium-Term Incentive Plan, Sonaecom purchased between 1 and 6 August 2012 a total of 127,401 shares, representing approximately 0.03% of its share capital, through the Euronext Lisbon Stock Exchange. As of 30 September 2012, Sonaecom held 7,025,192 own shares, representing 1.92% of its share capital.
Note: 2011 results were restated to reflect the change, from 1 January 2012, of the accounting treatment related with loyalty contracts acquisition costs, which started to be capitalized and amortized during the respective contract period.
| Million euros | ||||||||
|---|---|---|---|---|---|---|---|---|
| CONSOLIDATED INCOME STATEMENT | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
| Turnover | 224.9 | 210.1 | -6.6% | 204.5 | 2.7% | 650.3 | 617.0 | -5.1% |
| Mobile | 149.8 | 137.1 | -8.5% | 131.0 | 4.6% | 430.2 | 399.6 | -7.1% |
| Wireline | 56.6 | 52.9 | -6.5% | 55.4 | -4.4% | 163.5 | 161.7 | -1.1% |
| SSI | 27.4 | 28.0 | 2.1% | 24.8 | 12.8% | 83.3 | 77.0 | -7.6% |
| Other & Eliminations | -8.9 | -7.9 | 11.5% | -6.7 | -17.7% | -26.6 | -21.2 | 20.4% |
| Other Revenues | 2.0 | 1.8 | -9.3% | 2.7 | -33.4% | 6.3 | 6.8 | 7.6% |
| Operating Costs | 163.9 | 145.3 | -11.4% | 142.9 | 1.7% | 476.3 | 432.7 | -9.2% |
| Personnel Costs | 23.8 | 22.6 | -5.0% | 22.2 | 1.9% | 71.1 | 66.8 | -6.0% |
| Direct Servicing Costs(1) | 63.2 | 56.9 | -10.0% | 58.7 | -3.2% | 187.7 | 174.3 | -7.1% |
| Commercial Costs(2) | 38.1 | 31.3 | -18.0% | 24.0 | 30.5% | 101.2 | 80.8 | -20.2% |
| Other Operating Costs(3) | 38.9 | 34.6 | -11.1% | 38.1 | -9.2% | 116.3 | 110.8 | -4.7% |
| EBITDA | 62.9 | 66.5 | 5.8% | 64.2 | 3.7% | 180.3 | 191.1 | 6.0% |
| EBITDA Margin (%) | 28.0% | 31.7% | 3.7pp | 31.4% | 0.3pp | 27.7% | 31.0% | 3.2pp |
| Mobile | 58.8 | 61.9 | 5.2% | 59.5 | 3.9% | 168.7 | 176.7 | 4.8% |
| Wireline | 3.9 | 4.1 | 4.2% | 3.9 | 4.2% | 10.0 | 11.1 | 10.2% |
| SSI | 1.7 | 2.7 | 59.9% | 2.2 | 23.8% | 5.0 | 7.2 | 43.7% |
| Other & Eliminations | -1.5 | -2.1 | -40.7% | -1.4 | -46.8% | -3.5 | -4.0 | -13.5% |
| Depreciation & Amortization | 37.6 | 36.8 | -2.1% | 37.2 | -1.1% | 110.4 | 110.8 | 0.3% |
| EBIT | 25.4 | 29.8 | 17.3% | 27.0 | 10.2% | 69.8 | 80.3 | 15.0% |
| Net Financial Results | -2.1 | -3.5 | -68.4% | -3.5 | -0.5% | -6.8 | -9.3 | -35.9% |
| Financial Income | 2.3 | 1.4 | -38.0% | 1.4 | 0.7% | 5.5 | 5.0 | -8.2% |
| Financial Expenses | 4.4 | 4.9 | 12.0% | 4.9 | 0.6% | 12.3 | 14.3 | 16.2% |
| EBT | 23.3 | 26.3 | 12.8% | 23.5 | 11.6% | 63.0 | 71.0 | 12.7% |
| Tax results | 1.7 | -0.5 | - | -2.4 | 79.1% | -6.2 | -7.1 | -14.1% |
| Net Results | 25.0 | 25.8 | 3.1% | 21.2 | 21.7% | 56.8 | 63.9 | 12.5% |
| Group Share | 25.0 | 25.8 | 3.1% | 21.2 | 21.8% | 56.8 | 63.9 | 12.5% |
| Attributable to Non-Controlling Interests | 0.0 | 0.0 | -77.1% | 0.0 | -71.1% | 0.0 | 0.0 | -18.7% |
(1)Direct Servicing Costs = Interconnection and Content + Leased Lines+ OtherNetwork Operating Costs; (2) Commercial Costs = COGS + Mktg & Sales Costs; (3)OtherOperating Costs = Outsourcing Services +G&A +Provisions + others.
| Million euros | ||||||||
|---|---|---|---|---|---|---|---|---|
| CONSOLIDATED BALANCE SHEET | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
| Total Net Assets | 1,927.4 | 1902.6 | -1.3% | 1,925.5 | -1.2% | 1,927.4 | 1902.6 | -1.3% |
| Non Current Assets | 1,486.0 | 1,589.9 | 7.0% | 1,584.0 | 0.4% | 1,486.0 | 1,589.9 | 7.0% |
| Tangible and Intangible Assets | 853.9 | 962.9 | 12.8% | 957.9 | 0.5% | 853.9 | 962.9 | 12.8% |
| Goodwill | 526.1 | 529.9 | 0.7% | 529.6 | 0.0% | 526.1 | 529.9 | 0.7% |
| Investments | 0.2 | 0.2 | 0.0% | 0.2 | 0.0% | 0.2 | 0.2 | 0.0% |
| Deferred Tax Assets | 105.4 | 96.3 | -8.6% | 95.9 | 0.4% | 105.4 | 96.3 | -8.6% |
| Others | 0.3 | 0.7 | 149.2% | 0.3 | 125.3% | 0.3 | 0.7 | 149.2% |
| Current Assets | 441.4 | 312.7 | -29.2% | 341.5 | -8.4% | 441.4 | 312.7 | -29.2% |
| Trade Debtors | 133.2 | 121.1 | -9.1% | 121.1 | 0.0% | 133.2 | 121.1 | -9.1% |
| Liquidity | 183.0 | 69.0 | -62.3% | 109.0 | -36.7% | 183.0 | 69.0 | -62.3% |
| Others | 125.2 | 122.6 | -2.1% | 111.3 | 10.1% | 125.2 | 122.6 | -2.1% |
| Shareholders' Funds | 1,028.1 | 1,070.0 | 4.1% | 1,046.9 | 2.2% | 1,028.1 | 1,070.0 | 4.1% |
| Group Share | 1,027.6 | 1069.6 | 4.1% | 1,046.5 | 2.2% | 1,027.6 | 1069.6 | 4.1% |
| Non-Controlling Interests | 0.5 | 0.4 | -19.2% | 0.4 | 2.2% | 0.5 | 0.4 | -19.2% |
| Total Liabilities | 899.3 | 832.6 | -7.4% | 878.6 | -5.2% | 899.3 | 832.6 | -7.4% |
| Non Current Liabilities | 405.1 | 290.0 | -28.4% | 249.6 | 16.2% | 405.1 | 290.0 | -28.4% |
| Bank Loans | 319.1 | 195.2 | -38.8% | 146.3 | 33.4% | 319.1 | 195.2 | -38.8% |
| Provisions for Other Liabilities and Charges | 34.5 | 44.9 | 30.0% | 47.1 | -4.6% | 34.5 | 44.9 | 30.0% |
| Others | 51.5 | 50.0 | -3.0% | 56.2 | -11.1% | 51.5 | 50.0 | -3.0% |
| Current Liabilities | 494.2 | 542.6 | 9.8% | 629.0 | -13.7% | 494.2 | 542.6 | 9.8% |
| Bank Loans | 121.9 | 200.6 | 64.5% | 307.5 | -34.8% | 121.9 | 200.6 | 64.5% |
| Trade Creditors | 155.8 | 156.7 | 0.6% | 142.2 | 10.2% | 155.8 | 156.7 | 0.6% |
| Others | 216.5 | 185.3 | -14.4% | 179.3 | 3.4% | 216.5 | 185.3 | -14.4% |
| Operating CAPEX(1) | 28.4 | 41.9 | 47.5% | 33.3 | 25.7% | 82.1 | 100.7 | 22.8% |
| Operating CAPEX as % of Turnover | 12.6% | 19.9% | 7.3pp | 16.3% | 3.6pp | 12.6% | 16.3% | 3.7pp |
| Total CAPEX | 28.4 | 41.9 | 47.2% | 43.3 | -3.4% | 82.1 | 110.8 | 34.8% |
| EBITDA - Operating CAPEX | 34.5 | 24.7 | -28.6% | 30.9 | -20.1% | 98.2 | 90.3 | -8.1% |
| Operating Cash Flow(2) | 23.5 | 30.0 | 27.8% | 31.7 | - | 54.1 | -14.6 | - |
| FCF(3) | 16.7 | 18.8 | 13.0% | 14.2 | - | 28.6 | -53.4 | - |
| Gross Debt | 462.1 | 417.9 | -9.6% | 476.8 | -12.4% | 462.1 | 417.9 | -9.6% |
| Net Debt | 279.0 | 349.0 | 25.1% | 367.8 | -5.1% | 279.0 | 349.0 | 25.1% |
| Net Debt/ EBITDA last 12 months | 1.2 x | 1.4 x | 0.2x | 1.5 x | -0.1x | 1.2 x | 1.4 x | 0.2x |
| EBITDA/Interest Expenses(4) (last 12 months) | 16.5 x | 14.8 x | -1.7x | 14.9 x | -0.1x | 16.5 x | 14.8 x | -1.7x |
| Debt/Total Funds (Debt + Shareholders' Funds) | 31.0% | 28.1% | -2.9pp | 31.3% | -3.2pp | 31.0% | 28.1% | -2.9pp |
| Excluding the Securitisation Transaction: | ||||||||
| Net Debt | 323.6 | 370.8 | 14.6% | 394.6 | -6.0% | 323.6 | 370.8 | 14.6% |
| Net Debt/ EBITDA last 12 months | 1.4 x | 1.5 x | 0.1x | 1.6 x | -0.1x | 1.4 x | 1.5 x | 0.1x |
| EBITDA/Interest Expenses(4) (last 12 months) | 16.5 x | 14.8 x | -1.7x | 14.9 x | -0.1x | 16.5 x | 14.8 x | -1.7x |
(1)Operating CAPEX excludes Financial Investments: (2)Operating Cash Flow = EBITDA - Operating CAPEX - Change in WC -Non Cash item & Other; (3) FCF Levered after Financial Expenses but before Capital Flows and Financing related up-front Costs; (4)InterestCover.
| Million euros | ||||||||
|---|---|---|---|---|---|---|---|---|
| LEVERED FREE CASH FLOW | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
| EBITDA-Operating CAPEX | 34.5 | 24.7 | -28.6% | 30.9 | -20.1% | 98.2 | 90.3 | -8.1% |
| Change in WC | -11.2 | 7.0 | - | 2.9 | 139.5% | -47.0 | -99.5 | -111.7% |
| Non Cash Items & Other | 0.1 | -1.7 | - | -2.1 | 19.8% | 2.8 | -5.4 | - |
| Operating Cash Flow | 23.5 | 30.0 | 27.8% | 31.7 | -5.4% | 54.1 | -14.6 | - |
| Securitisation Transaction | -5.0 | -5.0 | 0.0% | -5.0 | 0.0% | -15.0 | -15.0 | 0.0% |
| Investments | 0.0 | 0.0 | - | -6.0 | 100.0% | 0.0 | -6.0 | - |
| Own shares | 0.0 | -0.2 | - | -2.5 | 93.9% | -2.2 | -3.4 | -52.2% |
| Financial results | -1.4 | -4.1 | -182.7% | -2.4 | -68.9% | -6.2 | -9.7 | -56.0% |
| Income taxes | -0.4 | -1.9 | - | -1.6 | -18.1% | -2.1 | -4.8 | -135.1% |
| FCF | 16.7 | 18.8 | 13.0% | 14.2 | 32.7% | 28.6 | -53.4 | - |
| Sonaecom | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
|---|---|---|---|---|---|---|---|---|
| Total Employees | 2,054 | 2,027 | -1.3% | 2,019 | 0.4% | 2,054 | 2,027 | -1.3% |
| Shared Services and Corporate Centre | 142 | 138 | -2.8% | 139 | -0.7% | 142 | 138 | -2.8% |
| Telecommunications | 1,085 | 1,019 | -6.1% | 1,025 | -0.6% | 1,085 | 1,019 | -6.1% |
| SSI | 569 | 622 | 9.3% | 603 | 3.2% | 569 | 622 | 9.3% |
| Online & Media | 258 | 248 | -3.9% | 252 | -1.6% | 258 | 248 | -3.9% |
| Million euros | ||||||||
|---|---|---|---|---|---|---|---|---|
| OPTIMUS INCOME STATEMENT | 3Q11 | 3Q12 | ∆ 12/11 | 2Q12 | q.o.q. | 9M11 | 9M12 | ∆ 12/11 |
| Turnover | 197.2 | 182.7 | -7.3% | 178.9 | 2.1% | 566.1 | 538.3 | -4.9% |
| Service Revenues | 187.8 | 173.9 | -7.4% | 172.0 | 1.1% | 545.7 | 517.2 | -5.2% |
| Customer Revenues | 146.3 | 134.5 | -8.1% | 133.7 | 0.6% | 433.8 | 403.6 | -6.9% |
| Operator Revenues | 41.5 | 39.4 | -5.0% | 38.3 | 2.9% | 111.9 | 113.5 | 1.5% |
| Equipment Sales | 9.4 | 8.8 | -5.9% | 6.9 | 27.7% | 20.5 | 21.2 | 3.4% |
| Other Revenues | 2.6 | 2.7 | 4.9% | 3.3 | -18.8% | 8.6 | 8.6 | 0.0% |
| Operating Costs | 137.0 | 119.5 | -12.8% | 118.7 | 0.6% | 396.0 | 359.2 | -9.3% |
| Personnel Costs | 13.4 | 11.7 | -12.6% | 11.0 | 6.8% | 40.6 | 35.7 | -12.0% |
| Direct Servicing Costs(1) | 63.0 | 56.7 | -10.1% | 58.6 | -3.2% | 187.3 | 173.7 | -7.3% |
| Commercial Costs(2) | 27.1 | 23.0 | -14.9% | 17.7 | 30.0% | 68.6 | 57.9 | -15.6% |
| Other Operating Costs(3) | 33.5 | 28.0 | -16.4% | 31.5 | -11.0% | 99.5 | 91.8 | -7.7% |
| EBITDA | 62.7 | 65.9 | 5.1% | 63.5 | 3.9% | 178.8 | 187.8 | 5.0% |
| EBITDA Margin (%) | 31.8% | 36.1% | 4.3pp | 35.5% | 0.6pp | 31.6% | 34.9% | 3.3pp |
| Operating CAPEX(4) | 27.4 | 40.8 | 48.7% | 33.3 | 22.4% | 79.6 | 99.6 | 25.2% |
| Operating CAPEX as % of Turnover | 13.9% | 22.3% | 8.4pp | 18.6% | 3.7pp | 14.1% | 18.5% | 4.4pp |
| EBITDA - Operating CAPEX | 35.3 | 25.1 | -28.8% | 30.1 | -16.7% | 99.2 | 88.2 | -11.1% |
| Total CAPEX | 27.5 | 40.9 | 48.9% | 34.4 | 19.1% | 79.7 | 100.8 | 26.5% |
(1)Direct Servicing Costs =Interconnection and Content + Leased Lines + OtherNetwork Operating Costs; (2) Commercial Costs = COGS + Mktg & Sales Costs; (3)OtherOperating Costs = Outsourcing Services +G&A +Provisions + others; (4)Operating CAPEX excludesFinancial Investments.
For the periods ended at 30 September 2012 and 2011 (restated), for the year ended at 31 December 2011 (restated) and for 1 January 2011 (restated)
| (Amounts expressed in euro) | Notes | September 2012 | September 2011 | December 2011 | 1 January 2011 |
|---|---|---|---|---|---|
| (restated) | (restated) | (restated) | |||
| Assets | |||||
| Non-current assets | |||||
| Tangible assets | 1.d, 1.i and 6 | 582,876,685 | 573,721,368 | 583,413,555 | 592,369,741 |
| Intangible assets | 1.e and 7 | 379,979,252 | 280,224,079 | 389,121,882 | 290,906,832 |
| Goodwill | 1.g and 9 | 529,882,329 | 526,133,731 | 521,103,723 | 526,141,552 |
| Investments available for sale | 1.h, 8 and 10 | 212,323 | 212,323 | 212,323 | 212,323 |
| Other non-current assets | 1.h, 1.s and 1.y | 701,845 | 283,771 | 264,973 | 174,363 |
| Deferred tax assets | 1.q, 1.t and 11 | 96,296,946 | 105,384,838 | 103,853,881 | 109,587,224 |
| Total non-current assets | 1,589,949,380 | 1,485,960,110 | 1,597,970,337 | 1,519,392,035 | |
| Current assets | |||||
| Inventories | 1.j | 14,282,672 | 14,227,875 | 7,365,390 | 17,473,750 |
| Trade debtors | 1.k and 8 | 121,140,637 | 133,201,825 | 146,137,974 | 143,294,200 |
| Other current debtors | 1.k and 8 | 29,432,676 | 32,552,816 | 25,933,462 | 61,302,698 |
| Other current assets | 1.s and 1.y | 78,874,262 | 78,417,903 | 70,723,575 | 69,839,130 |
| Cash and cash equivalents | 1.l, 8 and 12 | 68,966,622 | 183,025,312 | 189,350,054 | 68,577,903 |
| Total current assets | 312,696,869 | 441,425,731 | 439,510,455 | 360,487,681 | |
| Total assets | 1,902,646,249 | 1,927,385,841 | 2,037,480,792 | 1,879,879,716 | |
| Shareholders' funds and liabilities | |||||
| Shareholders' funds | |||||
| Share capital | 13 | 366,246,868 | 366,246,868 | 366,246,868 | 366,246,868 |
| Own shares | 1.v and 14 | (9,627,047) | (13,594,518) | (13,594,518) | (15,030,834) |
| Reserves | 1.u | 649,104,083 | 618,178,374 | 618,945,566 | 593,009,788 |
| Consolidated net income/(loss) for the period | 63,902,108 | 56,785,382 | 62,287,398 | 43,669,651 | |
| 1,069,626,012 | 1,027,616,106 | 1,033,885,314 | 987,895,473 | ||
| Non-controlling interests | 392,998 | 486,559 | 515,654 | 593,790 | |
| Total Shareholders' funds | 1,070,019,010 | 1,028,102,665 | 1,034,400,968 | 988,489,263 | |
| Liabilities | |||||
| Non-current liabilities | |||||
| Medium and long-term loans – net of short-term portion | 1.m, 1.n, 8 and 15 | 195,153,922 | 319,067,408 | 320,176,857 | 305,038,006 |
| Other non-current financial liabilities | 1.i, 8 and 16 | 19,311,607 | 18,628,442 | 17,990,531 | 19,253,869 |
| Provisions for other liabilities and charges | 1.p, 1.t and 17 | 44,914,742 | 34,547,649 | 48,549,956 | 33,150,028 |
| Securitisation of receivables | 8 and 18 | 5,000,000 | 24,914,706 | 19,951,846 | 39,740,412 |
| Deferred tax liabilities | 1.q and 11 | 1,564,042 | 5,366,134 | 5,186,711 | 5,559,170 |
| Other non-current liabilities | 1.s, 1.t and 1.y | 24,076,982 | 2,579,113 | 30,041,779 | 2,739,617 |
| Total non-current liabilities | 290,021,295 | 405,103,452 | 441,897,680 | 405,481,102 | |
| Current liabilities | |||||
| Short-term loans and other loans | 1.m, 1.n, 8 and 15 | 200,582,408 | 121,924,773 | 118,405,031 | 30,942,240 |
| Trade creditors | 8 | 156,687,700 | 155,791,136 | 172,622,586 | 178,732,746 |
| Other current financial liabilities | 1.i, 8, 16 and 19 | 2,893,694 | 2,449,306 | 2,645,498 | 2,171,140 |
| Securitisation of receivables | 8 and 18 | 19,915,612 | 19,764,541 | 19,802,596 | 19,634,161 |
| Other creditors | 8 | 13,316,233 | 24,877,605 | 23,832,672 | 56,752,155 |
| Other current liabilities | 1.s and 1.y | 149,210,297 | 169,372,363 | 223,873,761 | 197,676,909 |
| Total current liabilities | 542,605,944 | 494,179,724 | 561,182,144 | 485,909,351 | |
| Total Shareholders' funds and liabilities | 1,902,646,249 | 1,927,385,841 | 2,037,480,792 | 1,879,879,716 |
The notes are an integral part of the consolidated financial statements at 30 September 2012 and 2011 (restated – note 1). The Chief Accountant
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
For the periods and quarters ended at 30 September 2012 and 2011 (restated) and for the year ended at 31 December 2011 (restated)
| (Amounts expressed in euro) | Notes | September 2012 (not audited) |
July to September 2012 (not audited) |
September 2011 (restated and not audited) |
July to September 2011 (restated and not audited) |
December 2011 (restated) |
|---|---|---|---|---|---|---|
| Sales | 46,989,019 | 17,298,347 | 58,406,562 | 21,936,962 | 77,172,088 | |
| Services rendered | 569,986,050 | 192,764,936 | 591,902,261 | 202,966,508 | 786,462,327 | |
| Other operating revenues | 6,774,338 | 1,775,888 | 6,294,356 | 1,957,518 | 8,809,285 | |
| 623,749,407 | 211,839,171 | 656,603,179 | 226,860,988 | 872,443,700 | ||
| Cost of sales | (50,653,598) | (19,933,279) | (64,118,471) | (25,305,759) | (85,401,524) | |
| External supplies and services | 1.i and 20 | (287,919,376) | (94,769,429) | (313,041,951) | (105,169,271) | (419,762,108) |
| Staff expenses | 1.y | (66,797,611) | (22,594,692) | (71,054,381) | (23,794,867) | (92,443,327) |
| Depreciation and amortisation | 1.d, 1.e, 6 and 7 | (110,757,246) | (36,784,142) | (110,437,469) | (37,563,713) | (153,301,640) |
| Provisions and impairment losses | 1.p, 1.x and 17 | (16,948,273) | (5,473,639) | (17,022,137) | (5,791,162) | (23,698,647) |
| Other operating costs | (10,377,638) | (2,522,715) | (11,081,153) | (3,874,584) | (15,663,550) | |
| (543,453,742) | (182,077,896) | (586,755,562) | (201,499,354) | (790,270,796) | ||
| Losses in group and associated companies | - | - | - | - | (54,422) | |
| Other financial expenses | 1.n, 1.w, 1.x and 21 | (14,326,518) | (4,944,603) | (12,324,201) | (4,413,568) | (17,413,177) |
| Other financial income | 1.w and 21 | 5,043,107 | 1,448,218 | 5,495,443 | 2,337,570 | 8,575,532 |
| Current income / (loss) | 71,012,254 | 26,264,890 | 63,018,859 | 23,285,636 | 73,280,837 | |
| Income taxation | 1.q, 11 and 22 | (7,101,225) | (492,526) | (6,222,509) | 1,716,832 | (10,955,640) |
| Consolidated net income/(loss) for the period | 63,911,029 | 25,772,364 | 56,796,350 | 25,002,468 | 62,325,197 | |
| Attributed to: | ||||||
| Shareholders of parent company | 26 | 63,902,108 | 25,767,675 | 56,785,382 | 24,982,002 | 62,287,398 |
| Non-controlling interests | 8,921 | 4,689 | 10,968 | 20,466 | 37,799 | |
| Earnings per share Including discontinued operations: |
||||||
| Basic | 0.18 | 0.07 | 0.16 | 0.07 | 0.17 | |
| Diluted | 0.18 | 0.07 | 0.16 | 0.07 | 0.17 | |
| Excluding discontinued operations: | ||||||
| Basic | 0.18 | 0.07 | 0.16 | 0.07 | 0.17 | |
| Diluted | 0.18 | 0.07 | 0.16 | 0.07 | 0.17 | |
The notes are an integral part of the consolidated financial statements at 30 September 2012 and 2011 (restated – note 1).
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
For the periods and quarters ended at 30 September 2012 and 2011 (restated) and for the year ended at 31 December 2011 (restated)
| (Amounts expressed in euro) | Notes | September 2012 (not audited) |
July to September 2012 (not audited) |
September 2011 (restated and not audited) |
July to September 2011 (restated and not audited) |
December 2011 (restated) |
|---|---|---|---|---|---|---|
| Consolidated net income / (loss) for the period | 63,911,029 | 25,772,364 | 56,796,350 | 25,002,468 | 62,325,197 | |
| Components of other consolidated comprehensive income, net of tax Changes in currency translation reserve and other |
1.w | (1,174,782) | (425,593) | (132,874) | (422,984) | (297,463) |
| Consolidated comprehensive income for the period | 62,736,247 | 25,346,771 | 56,663,476 | 24,579,484 | 62,027,734 | |
| Attributed to: | ||||||
| Shareholders of parent company | 62,727,326 | 25,342,082 | 56,652,508 | 24,559,018 | 61,989,935 | |
| Non-controlling interests | 8,921 | 4,689 | 10,968 | 20,466 | 37,799 | |
The notes are an integral part of the consolidated financial statements at 30 September 2012 and 2011 (restated – note 1).
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
For the periods ended at 30 September 2012 and 2011 (restated)
| Reserves | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| (Amounts expressed in euro) | Share capital | Own shares (note 14) |
Share premium |
Legal reserves |
Reserves of own shares |
Reserves for Medium Term Incentive Plans |
(note 27) Other reserves Total reserves | Non- -controlling interests |
Net income / (loss) |
Total | |
| 2012 | |||||||||||
| Balance at 31 December 2011 (restated) | 366,246,868 (13,594,518) 775,290,377 | 7,991,192 | 13,594,518 | 7,119,989 | (185,050,511) | 618,945,566 | 62,287,398 | 1,033,885,314 | |||
| Appropriation of the consolidated net result of 2011 (restated) | |||||||||||
| Transfers to other reserves (restated) | - | - | - | - | - | - | 62,287,398 | 62,287,398 | - (62,287,398) | - | |
| Dividend distribution | - | - | - | - | - | - | (25,172,240) | (25,172,240) | - | - | (25,172,240) |
| Consolidated comprehensive income for the period | |||||||||||
| ended at 30 September 2012 | - | - | - | - | - | - | (1,174,782) | (1,174,782) | - | 63,902,108 | 62,727,326 |
| Acquisition of own shares | - (3,382,977) | - | - | 3,382,977 | - | (3,382,977) | - | - | - | (3,382,977) | |
| Delivery of own shares under the Short and Medium Term Incentive Plans (notes 1.y and 27) |
- | 7,350,448 | - | - (7,350,448) | (4,006,035) | 5,751,065 | (5,605,420) | - | - | 1,745,029 | |
| Effect of the recognition of the Medium Term Incentive Plans (notes 1.y and 27) |
|||||||||||
| - | - | - | - | - | 3,115,080 | - | 3,115,080 | - | - | 3,115,080 | |
| Derivate on own shares (notes 18 and 21) | - | - | - | - | - | - | (3,291,520) | (3,291,520) | - | - | (3,291,520) |
| Balance at 30 September 2012 | 366,246,868 (9,627,047) 775,290,377 | 7,991,192 | 9,627,047 | 6,229,034 (150,033,567) | 649,104,083 | - | 63,902,108 | 1,069,626,012 | |||
| Non-controlling interests | |||||||||||
| Balance at 31 December 2011 | - | - | - | - | - | - | - | - | 515,654 | - | 515,654 |
| Non-controlling interests in comprehensive income | - | - | - | - | - | - | - | - | 8,921 | - | 8,921 |
| Dividend distribution | - | - | - | - | - | - | - | - | (124,500) | - | (124,500) |
| Other changes | - | - | - | - | - | - | - | - | (7,077) | - | (7,077) |
| Balance at 30 September 2012 | - | - | - | - | - | - | - | - | 392,998 | - | 392,998 |
| Total | 366,246,868 (9,627,047) 775,290,377 | 7,991,192 | 9,627,047 | 6,229,034 (150,033,567) | 649,104,083 | 392,998 | 63,902,108 | 1,070,019,010 |
For the periods ended at 30 September 2012 and 2011 (restated)
| Reserves | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| (Amounts expressed in euro) | Share capital | Own shares (note 14) |
Share premium |
Legal reserves |
Reserves of own shares |
Reserves for Medium Term Incentive Plans |
(note 27) Other reserves Total reserves | Non- -controlling interests |
Net income / (loss) |
Total | |
| 2011 | |||||||||||
| Balance at 31 December 2010 (restated) Appropriation of the consolidated net result of 2010 (restated) |
366,246,868 (15,030,834) 775,290,377 | 1,221,003 15,030,834 | 4,812,753 | (203,345,179) | 593,009,788 | – | 43,669,651 | 987,895,473 | |||
| Transfers to legal reserves and other reserves (restated) |
– | – | – | 6,770,189 | – | – | 36,899,462 | 43,669,651 | – (43,669,651) | – | |
| Dividend distribution | – | – | – | – | – | – | (17,859,403) | (17,859,403) | – | – | (17,859,403) |
| Consolidated comprehensive income for the period ended at 30 September 2011 |
– | – | – | – | – | – | (132,874) | (132,874) | – | 56,785,382 | 56,652,508 |
| Acquisition of own shares | – | (2,223,287) | – | – | 2,223,287 | – | (2,223,287) | – | – | – | (2,223,287) |
| Delivery of own shares under the Short and Medium Term Incentive Plans (notes 1.y and 27) Effect of the recognition of the Medium Term |
– | 3,659,603 | – | – (3,659,603) | (1,604,799) | 1,775,360 | (3,489,042) | – | – | 170,561 | |
| Incentive Plans (notes 1.y and 27) | – | – | – | – | – | 2,980,254 | – | 2,980,254 | – | – | 2,980,254 |
| Balance at 30 September 2011 (restated) | 366,246,868 (13,594,518) 775,290,377 | 7,991,192 | 13,594,518 | 6,188,208 | (184,885,921) | 618,178,374 | – | 56,785,382 | 1,027,616,106 | ||
| Non-controlling interests | |||||||||||
| Balance at 31 December 2010 (restated) | – | – | – | – | – | – | – | – | 593,790 | – | 593,790 |
| Non-controlling interests in comprehensive income | – | – | – | – | – | – | – | – | 10,968 | – | 10,968 |
| Dividend distribution | – | – | – | – | – | – | – | – | (124,500) | – | (124,500) |
| Other changes | – | – | – | – | – | – | – | – | 6,301 | – | 6,301 |
| Balance at 30 September 2011 (restated) | – | – | – | – | – | – | – | – | 486,559 | – | 486,559 |
| Total | 366,246,868 (13,594,518) 775,290,377 | 7,991,192 | 13,594,518 | 6,188,208 | (184,885,921) | 618,178,374 | 486,559 | 56,785,382 | 1,028,102,665 |
The notes are an integral part of the consolidated financial statements at 30 September 2012 and 2011 (restated – note 1).
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
For the periods ended at 30 September 2012 and 2011
| (Amounts expressed in euro) | September 2012 | September 2011 | ||
|---|---|---|---|---|
| Operating activities | ||||
| Receipts from trade debtors | 606,417,754 | 638,080,133 | ||
| Payments to trade creditors | (362,712,707) | (409,920,816) | ||
| Payments to employees | (81,129,140) | (79,445,037) | ||
| Cash flows from operating activities | 162,575,907 | 148,714,280 | ||
| Payments / receipts relating to income taxes, net | (4,840,059) | (2,058,841) | ||
| Other payments / receipts relating to operating activities, net | (4,875,283) | (9,846,736) | ||
| Cash flows from operating activities (1) | 152,860,565 | 152,860,565 | 136,808,703 | 136,808,703 |
| Investing activities | ||||
| Receipts from: | ||||
| Tangible assets | 9,118,193 | 16,266,882 | ||
| Intangible assets | – | 37,463 | ||
| Interest and similar income | 4,414,619 | 4,519,144 | ||
| Dividens | 11,443 | 13,544,255 | – | 20,823,489 |
| Payments for: | ||||
| Financial investments | (6,447,860) | (8,860,291) | ||
| Tangible assets | (67,891,788) | (74,688,845) | ||
| Intangible assets | (109,825,306) | (15,980,291) | ||
| Loans granted | – | (184,164,954) | (3,570) | (99,532,997) (78,709,508) |
| Cash flows from investing activities (2) | (170,620,699) | |||
| Financing activities Receipts from: |
||||
| Loans obtained | 33,347,408 | 33,347,408 | 107,700,000 | 107,700,000 |
| Payments for: | ||||
| Leasing | (2,572,704) | (1,955,766) | ||
| Interest and similar expenses | (14,381,481) | (12,099,477) | ||
| Dividends | (25,296,740) | (17,983,903) | ||
| Acquisition of own shares | (3,382,976) | (2,223,287) | ||
| Loans obtained | (103,096,843) | (148,730,744) | (15,095,748) | (49,358,181) |
| Cash flows from financing activities (3) | (115,383,336) | 58,341,819 | ||
| Net cash flows (4)=(1)+(2)+(3) | (133,143,470) | 116,441,014 | ||
| Effect of the foreign exchanges | (108,074) | (184,610) | ||
| Cash and cash equivalents at the beginning of the period | 189,031,758 | 65,985,051 | ||
| Cash and cash equivalents at the end of the period | 55,780,214 | 182,241,455 | ||
The notes are an integral part of the consolidated financial statements at 30 September 2012 and 2011 (restated – note 1).
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
For the periods ended at 30 September2012 and 2011
| September 2012 | September 2011 | |
|---|---|---|
| a) Amounts of acquisitions paid | ||
| Connectiv Solutions, Inc | 6,441,678 | – |
| Infosystems | 6,182 | – |
| Sontária - Empreendimentos Imobiliários, S.A. | – | 8,860,291 |
| 6,447,860 | 8,860,291 |
| September 2012 | September 2011 | |
|---|---|---|
| Cash in hand | 496,718 | 111,362 |
| Cash at bank | 9,584,956 | 5,883,950 |
| Treasury applications | 58,884,948 | 177,030,000 |
| Overdrafts | (13,186,408) | (783,857) |
| Cash and cash equivalents | 55,780,214 | 182,241,455 |
| Overdrafts | 13,186,408 | 783,857 |
| Cash assets | 68,966,622 | 183,025,312 |
| September 2012 | September 2011 | |
|---|---|---|
| a) Bank credit obtained and not used | 55,119,000 | 103,050,000 |
| b) Purchase of company through the issue of shares | Not applicable | Not applicable |
| c) Conversion of loans into shares | Not applicable | Not applicable |
| Activity | Cash flow from operating activities |
Cash flow from investing activities |
Cash flow from financing activities |
Net cash flows |
|---|---|---|---|---|
| Telecommunication | 159,049,549 | (163,541,331) | (19,988,117) | (24,479,899) |
| Multimedia | (2,333,452) | (709,544) | (125,021) | (3,168,017) |
| Information Systems | (2,971,448) | (7,529,239) | 5,634,995 | (4,865,692) |
| Holding | (884,084) | 1,159,415 | (100,905,193) | (100,629,862) |
| 152,860,565 | (170,620,699) | (115,383,336) | (133,143,470) |
The notes are an integral part of the consolidated financial statements at 30 September 2012 and 2011 (restated – note 1).
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
SONAECOM, S.G.P.S., S.A. (hereinafter referred to as 'the Company' or 'Sonaecom') was established on 6 June 1988, under the name Sonae – Tecnologias de Informação, S.A. and has its head office at Lugar de Espido, Via Norte, Maia – Portugal. It is the parent company of the Group of companies listed in notes 2 and 3 ('the Group').
Pargeste, S.G.P.S., S.A.'s subsidiaries in the communications and information technology area were transferred to the Company through a demerger-merger process, executed by public deed dated 30 September 1997.
On 3 November 1999 the Company's share capital was increased, its Articles of Association were modified and its name was changed to Sonae.com, S.G.P.S., S.A.. Since then the Company's corporate object has been the management of investments in other companies. Also on 3 November 1999, the Company's share capital was re-denominated to euro, being represented by one hundred and fifty million shares with a nominal value of 1 euro each.
On 1 June 2000, the Company carried out a Combined Share Offer, involving the following:
In addition to the Combined Share Offer, the Company's share capital was increased under the terms explained below. The new shares were fully subscribed for and paid up by Sonae, S.G.P.S., S.A. (a Shareholder of Sonaecom, hereinafter referred to as 'Sonae'). The capital increase was subscribed for and paid up on the date the price of the Combined Share Offer was determined, and paid up in cash, 31,000,000 new ordinary shares of 1 euro each being issued. The subscription price for the new shares was the same as that fixed for the sale of shares in the aforementioned Combined Share Offer, which was Euro 10.
In addition, in this year, Sonae sold 4,721,739 Sonaecom shares under an option granted to the banks leading the Institutional Offer for Sale and 1,507,865 shares to Sonae Group managers and to the former owners of the companies acquired by Sonaecom.
By decision of the Shareholders' General Meeting held on 17 June 2002, Sonaecom's share capital was increased from Euro 181,000,000 to Euro 226,250,000 by public subscription reserved for the existing Shareholders, 45,250,000 new shares of 1 euro each having been fully subscribed for and paid up at the price of Euro 2.25 per share.
On 30 April 2003, the Company's name was changed by public deed to SONAECOM, S.G.P.S., S.A..
By decision of the Shareholders' General Meeting held on 12 September 2005, Sonaecom's share capital was increased by Euro 70,276,868, from Euro 226,250,000 to Euro 296,526,868, by the issuance of 70,276,868 new shares of 1 euro each and with a share premium of Euro 242,455,195, fully subscribed by France Telecom. The corresponding public deed was executed on 15 November 2005.
By decision of the Shareholders General Meeting held on 18 September 2006, Sonaecom's share capital was increased by Euro 69,720,000, from Euro 296,526,868 to Euro 366,246,868, by the issuance of 69,720,000 new shares of 1 euro each and with a share premium of Euro 275,657,217, subscribed by 093X – Telecomunicações Celulares, S.A. (EDP) and Parpública – Participações Públicas, SGPS, S.A. (Parpública). The corresponding public deed was executed on 18 October 2006.
By decision of the Shareholders General Meeting held on 16 April 2008, bearer shares were converted into registered shares.
The Group's business consists essentially of:
The Group operates in Portugal and has subsidiaries (from the information systems consultancy segment) operating in about 13 countries.
Since 1 January 2001, all Group companies based in the euro zone have adopted the euro as their base currency for processing, systems and accounting.
The consolidated financial statements are also presented in euro, rounded at unit, and the transactions in foreign
The accompanying financial statements relate to the consolidated financial statements of the Sonaecom Group and have been prepared on a going concern basis, based on the accounting records of the companies included in the consolidation (notes 2 and 3) in accordance with the International Financial Reporting Standards (IAS/IFRS) as adopted by the European Union (EU) and considering the IAS 34 – 'Interim financial reporting'. These financial statements were prepared based on the acquisition cost, except for the revaluation of some financial instruments.
For Sonaecom, there are no differences between IFRS as adopted by European Union and IFRS published by the International Accounting Standards Board.
Sonaecom adopted IAS/IFRS for the first time according to SIC 8 (First-time adoption of IAS) on 1 January 2003.
Until the date of approval of these financial statements there are no standards, interpretations, amendments and revisions that have been approved (endorsed) by the European Union, whose application is mandatory in 1 January 2012 or in future financial years and adopted in the period ended in 30 September 2012.
The following standards, interpretations, amendments and revisions have been at the date of approval of these financial statements, approved (endorsed) by the European Union, whose application is mandatory only in future financial years:
| Standard / Interpretation | Effective date (annual |
|---|---|
| periods beginning on or | |
| after) | |
| IAS 1 - Amendments (Presentation of Items of | 5-Jun-12 |
| Other Comprehensive Income) |
The amendments to IAS 1 require companies preparing financial statements in accordance with IFRSs to group together items within OCI that may be reclassified to the profit or loss section of the income statement.
IAS 19 - Amendments (Employee Benefits) 5-Jun-12
The amendments make important improvements by eliminating an option to defer the recognition of gains and losses, known as the 'corridor method', improving comparability and faithfulness of presentation, streamlining the presentation of changes in assets and liabilities arising from defined benefit plans and enhancing the disclosure requirements for defined benefit plans.
These standards, although approved (endorsed) by the European Union, were not adopted by the Group in the period ended at 30 September 2012, as the application of these standards is not yet mandatory.
No significant impacts are expected to arise in the financial statements resulting from the adoption of the same.
The following standards, interpretations, amendments and revisions have not yet been approved (endorsed) by the European Union, at the date of approval of these financial statements:
| Standard / Interpretation | Effective date (annual periods beginning on or after) |
|---|---|
| IFRS 1 - Amendments (Severe | 1-Jul-11 |
| Hyperinflation and Removal of Fixed Dates | |
| for First-Time Adopters) | |
| The amendments referred to the Severe Hyperinflation and Removal of | |
| Fixed Dates for First-Time Adopters: 1) replace the fixed dates in the | |
| derecognition exception and the exemption related to the initial fair | |
| value measurement of financial instruments; and 2) add a deemed cost |
value measurement of financial instruments; and 2) add a deemed cost exemption to IFRS 1 that an entity can apply at the date of transaction to IFRSs after being subject to severe hyperinflation.
The amendments referred to the Government Loans addresses how a first-time adopters would account for a government loan with a belowmarket rate of interest when transitioning to IFRS and proposes to permit prospective application of IAS 20 requirements.
Disclosures)
The amendment requires disclosures to improve the understanding of transfer transactions of financial assets (for example, securitisations), including understanding the possible effects of any risks that may remain after the transfer. It also requires additional disclosures if a disproportionate amount of transfer transactions are undertaken around the end of a reporting period.
| IFRS 9 (Financial Instruments and | 1-Jan-15 |
|---|---|
| subsquent amendments) |
This standard is the first step in the project to replace IAS 39, and it introduces new requirements for classifying and measuring financial assets.
Builds on existing principles by identifying the concept of control as the determining factor in whether an entity should be included within the consolidated financial statements of the parent company. The standard provides additional guidance to assist in the determination of control where this is difficult to assess.
| IFRS 11 (Joint Arrangements) | 1-Jan-13 |
|---|---|
Provides for a more realistic reflection of joint arrangements by focusing on the rights and obligations of the arrangement, rather than its legal form (as is currently the case). The standard addresses inconsistencies in the reporting of joint arrangements by requiring a single method to account for interests in jointly controlled entities.
IFRS 12 (Disclosures of Interests in Other Entities) 1-Jan-13
New and comprehensive standard on disclosure requirements for all forms of interests in other entities, including joint arrangements, associates, special purpose vehicles and other off balance sheet vehicles.
| Standard / Interpretation | Effective date (annual periods beginning on or |
|---|---|
| after) | |
| IFRS 13 (Fair Value Measurement) | 1-Jan-13 |
| It will improve consistency and reduce complexity by providing, for the | |
| first time, a precise definition of fair value and a single source of fair value | |
| measurement and disclosure requirements for use across IFRSs. | |
| Improvements to IFRS (2009-2011) | 1-Jan-13 |
| The IASB finalise its annual improvements publication corresponding to | |
| the 2009-2011 cycle including six amendments to five IFRSs. The | |
| annual improvements process provides a mechanism for non urgent | |
| but necessary amendments to International Financial Reporting | |
| Standards (IFRSs) to be grouped together and issued in one package. | |
| Transition Guidance (Amendments to IFRS | 1-Jan-13 |
| 10, IFRS 11 and IFRS 12) | |
| The amendments clarify the transition guidance in IFRS 10 | |
| Consolidated Financial Statements and also provide additional transition | |
| relief in IFRS 11 Joint Arrangements and IFRS 12 Disclosure of Interests | |
| in Other Entities, limiting the requirement to provide adjusted | |
| comparative information to only the preceding comparative period. | |
| Furthermore, for disclosures related to unconsolidated structured | |
| entities, the amendments will remove the requirement to present | |
| comparative information for periods before IFRS 12 is first applied. | |
| IAS 12 - Amendments (Deferred tax: | 1-Jan-12 |
| Recovery of Underlying Assets) | |
| The amendment introduces, in the case of investment properties | |
| measured using the fair value model, the presumption that recovery of | |
| the carrying amount will normally be through sale, in order to determine | |
| their tax impact. As a result of the amendments, SIC 21 - 'Income Taxes—Recovery of Revalued Non-Depreciable Assets' would no longer |
|
| apply to investment properties carried at fair value. The amendments | |
| also incorporate into IAS 12 the remaining guidance previously | |
| contained in SIC-21, which is accordingly withdrawn. | |
| IAS 27 (Separate Financial Statements) | 1-Jan-13 |
| Consolidation requirements previously forming part of IAS 27 have | |
| been revised and are now contained in IFRS 10 Consolidated Financial | |
| Statements´. | |
| IAS 28 (Investments in Associates and Joint | 1-Jan-13 |
| Ventures) | |
| The objective of IAS 28 (as amended in 2011) is to prescribe the | |
| accounting for investments in associates and to set out the | |
| requirements for the application of the equity method when | |
| accounting for investments in associates and joint ventures. | |
| IAS 32 - Amendments (Offsetting Financial | 1-Jan-14 |
| Assets and Financial Liabilities) | |
| IAS 32 is amended to refer to the IFRS 7 disclosure requirements in | |
| respect of offsetting arrangements. | |
| IFRIC 20 Interpretation (Stripping Costs in | 1-Jan-13 |
| the Production Phase of a Surface Mine) | |
| The Interpretation clarifies when production stripping should lead to the | |
recognition of an asset and how that asset should be measured, both initially and in subsequent periods.
The application of these standards and interpretations, when applicable, will have no material effect on future consolidated financial statements.
During the period ended at 30 September 2012, in line with best practice in the telecoms sector, the Group changed its accounting criteria for costs related to customers' loyalty contracts. To date, these were recorded as an expense in the year they occurred. From 1 January 2012, the costs incurred for customers' loyalty contracts, which include compensation clauses in the event of early termination, are capitalized as 'Intangible Assets' and amortised over the period of their contracts. This change occurs because it is now possible to apply a reliable cost allocation to the respective contracts, as well as the revenue generated by each contract, thus fulfilling the criteria for capitalisation required by IAS 38 – Intangible assets.
When a contract is terminated, the net value of intangible assets associated with this contract is immediately recognised as an expense in the income statement. This accounting policy allows a more true, fair and reliable presentation of the financial position and the financial performance of the Group, as it allows the alignment between the costs incurred with customer's loyalty contracts and the revenue generated.
Additionally, with the perceived relevant frequency, impairment tests will be made to ensure that the current value of the estimated revenues associated with each contract is greater than the amount that is capitalised.
As provided under IAS 8 - Accounting policies, changes in accounting estimates and errors, the policy change was applied retrospectively. Therefore, on 1 January 2011, the Group recognized an intangible asset related to the amount of costs incurred with customers' loyalty contracts by that date, net of the respective amortisation and accumulated impairment losses. The consolidated income statement for 2011 has been adjusted to reflect: (1) the capitalization of costs incurred with customers' loyalty contracts and (ii) amortisation and impairment losses of intangible assets recognized in the year and in the previous years. Consequently, changes were made in the consolidated balance sheets of 1 January 2011, 30 September 2011 and 31 December 2011, as well as in the consolidated Income statements (by nature) for the period ended 30 September 2011 and for the year ended on 31 December 2011, as follows:
| (Amounts expressed in euro) | Before the change |
Effect of the change |
Balance sheet restated |
|---|---|---|---|
| Assets | |||
| Tangible assets | 592,369,741 | - | 592,369,741 |
| Intangible assets | 272,896,942 | 18,009,890 | 290,906,832 |
| Goodwill | 526,141,552 | - | 526,141,552 |
| Other assets | 470,461,591 | - | 470,461,591 |
| Total assets | 1,861,869,826 | 18,009,890 | 1,879,879,716 |
| Liabilities | |||
| Non-current liabilities | 400,708,481 | 4,772,621 | 405,481,102 |
| Current liabilities | 485,909,351 | - | 485,909,351 |
| Total liabilities | 886,617,832 | 4,772,621 | 891,390,453 |
| Shareholders' funds excl. non-control. interests | 974,658,204 | 13,237,269 | 987,895,473 |
| Non-controlling interests | 593,790 | - | 593,790 |
| Total Shareholders' funds | 975,251,994 | 13,237,269 | 988,489,263 |
| Total Shareholders' funds and liabilities | 1,861,869,826 | 18,009,890 | 1,879,879,716 |
| Before the | Effect of the | Balance sheet | ||
|---|---|---|---|---|
| (Amounts expressed in euro) | change | change | restated | |
| Assets | ||||
| Tangible assets | 573,721,368 | - | 573,721,368 | |
| Intangible assets | 262,630,465 | 17,593,614 | 280,224,079 | |
| Goodwill | 526,133,731 | - | 526,133,731 | |
| Other assets | 547,306,663 - |
547,306,663 | ||
| Total assets | 1,909,792,227 | 17,593,614 | 1,927,385,841 | |
| Liabilities | ||||
| Non-current liabilities | 400,441,144 | 4,662,308 | 405,103,452 | |
| Current liabilities | 494,179,724 - |
494,179,724 | ||
| Total liabilities | 894,620,868 | 4,662,308 | 899,283,176 | |
| Shareholders' funds excl. non-control. interests | 1,014,684,800 | 12,931,306 | 1,027,616,106 | |
| Non-controlling interests | 486,559 | - | 486,559 | |
| Total Shareholders' funds | 1,015,171,359 | 12,931,306 | 1,028,102,665 | |
| Total Shareholders' funds and liabilities | 1,909,792,227 | 17,593,614 | 1,927,385,841 |
Balance sheet at 31 December 2011
| Before the change |
Effect of the change |
Balance sheet restated |
|
|---|---|---|---|
| 583,413,555 | - | 583,413,555 | |
| 371,429,260 | 17,692,622 | 389,121,882 | |
| 521,103,723 | - | 521,103,723 | |
| 543,841,632 | - | 543,841,632 | |
| 2,019,788,170 | 17,692,622 | 2,037,480,792 | |
| 437,209,135 | 4,688,545 | 441,897,680 | |
| 561,182,144 | - | 561,182,144 | |
| 998,391,279 | 4,688,545 | 1,003,079,824 | |
| 1,020,881,237 | 13,004,077 | 1,033,885,314 | |
| 515,654 | - | 515,654 | |
| 1,021,396,891 | 13,004,077 | 1,034,400,968 | |
| 2,019,788,170 | 17,692,622 | 2,037,480,792 | |
| Before the | Effect of the | Balance sheet | ||
|---|---|---|---|---|
| (Amounts expressed in euro) | change | change | restated | |
| Assets | ||||
| Tangible assets | 582,876,685 | - | 582,876,685 | |
| Intangible assets | 365,083,544 | 14,895,708 | 379,979,252 | |
| Goodwill | 529,882,329 | - | 529,882,329 | |
| Other assets | 409,907,983 | - | 409,907,983 | |
| Total assets | 1,887,750,541 | 14,895,708 | 1,902,646,249 | |
| Liabilities | ||||
| Non-current liabilities | 288,462,766 | 1,558,529 | 290,021,295 | |
| Current liabilities | 542,605,944 | - | 542,605,944 | |
| Total liabilities | 831,068,710 | 1,558,529 | 832,627,239 | |
| Shareholders' funds excl. non-control. interests | 1,056,288,833 | 13,337,179 | 1,069,626,012 | |
| Non-controlling interests | 392,998 | - | 392,998 | |
| Total Shareholders' funds | 1,056,681,831 | 13,337,179 | 1,070,019,010 | |
| Total Shareholders' funds and liabilities | 1,887,750,541 | 14,895,708 | 1,902,646,249 | |
| (Amounts expressed in euro) | Before the change |
Effect of the change |
Profit and loss stat. restated |
|---|---|---|---|
| Total revenue | 656,603,179 | - | 656,603,179 |
| Costs and losses | |||
| External supplies and services | (329,309,958) | 16,268,007 | (313,041,951) |
| Depreciation and amortisation | (93,753,186) | (16,684,283) | (110,437,469) |
| Other operating costs | (163,276,142) | - | (163,276,142) |
| EBIT | 70,263,893 | (416,276) | 69,847,617 |
| Financial results | (6,828,758) | - | (6,828,758) |
| Income taxation | (6,332,822) | 110,313 | (6,222,509) |
| Consolidated net income / (loss) | 57,102,313 | (305,963) | 56,796,350 |
| Attributed to non-controlling interests | 10,968 | - | 10,968 |
| Attributed to shareholders of parent company | 57,091,345 | (305,963) | 56,785,382 |
| Earnings per share | |||
| Including discontinued operations: | |||
| Basic | 0.16 | 0.00 | 0.16 |
| Diluted | 0.16 | 0.00 | 0.16 |
| Excluding discontinued operations: | |||
| Basic | 0.16 | 0.00 | 0.16 |
| Diluted | 0.16 | 0.00 | 0.16 |
| Before the | Effect of the | Profit and loss | |
|---|---|---|---|
| (Amounts expressed in euro) | change | change | stat. restated |
| Total revenue | 872,443,700 | - | 872,443,700 |
| Costs and losses | |||
| External supplies and services | (442,250,912) | 22,488,804 | (419,762,108) |
| Depreciation and amortisation | (130,495,567) | (22,806,073) | (153,301,640) |
| Other operating costs | (217,207,048) | - | (217,207,048) |
| EBIT | 82,490,173 | (317,269) | 82,172,904 |
| Financial results | (8,892,067) | - | (8,892,067) |
| Income taxation | (11,039,716) | 84,076 | (10,955,640) |
| Consolidated net income / (loss) | 62,558,390 | (233,193) | 62,325,197 |
| Attributed to non-controlling interests | 37,799 | - | 37,799 |
| Attributed to shareholders of parent company | 62,520,591 | (233,193) | 62,287,398 |
| Earnings per share | |||
| Including discontinued operations: | |||
| Basic | 0.18 | 0.00 | 0.17 |
| Diluted | 0.18 | 0.00 | 0.17 |
| Excluding discontinued operations: | |||
| Basic | 0.18 | 0.00 | 0.17 |
| Diluted | 0.18 | 0.00 | 0.17 |
| Before the | Effect of the | Profit and loss | |
|---|---|---|---|
| (Amounts expressed in euro) | change | change | stat. restated |
| Total revenue | 623,749,407 | - | 623,749,407 |
| Costs and losses | |||
| External supplies and services | (302,775,880) | 14,856,504 | (287,919,376) |
| Depreciation and amortisation | (93,103,829) | (17,653,417) | (110,757,246) |
| Other operating costs | (144,777,120) | - | (144,777,120) |
| EBIT | 83,092,578 | (2,796,913) | 80,295,665 |
| Financial results | (9,283,411) | - | (9,283,411) |
| Income taxation | (10,231,241) | 3,130,016 | (7,101,225) |
| Consolidated net income / (loss) | 63,577,926 | 333,103 | 63,911,029 |
| Attributed to non-controlling interests | 8,921 | - | 8,921 |
| Attributed to shareholders of parent company | 63,569,005 | 333,103 | 63,902,108 |
| Earnings per share | |||
| Including discontinued operations: | |||
| Basic | 0.18 | 0.00 | 0.18 |
| Diluted | 0.18 | 0.00 | 0.18 |
| Excluding discontinued operations: | |||
| Basic | 0.18 | 0.00 | 0.18 |
| Diluted | 0.18 | 0.00 | 0.18 |
The accounting policies and measurement criteria adopted by the Group on 30 September 2012 are comparable with those used in the preparation of 31 December 2011 financial
statements, with the exception for the point mentioned above.
The main accounting policies used in the preparation of the accompanying consolidated financial statements are as follows:
Investments in companies in which the Group has direct or indirect voting rights at Shareholders' General Meetings, in excess of 50%, or in which it has control over the financial and operating policies (definition of control used by the Group) were fully consolidated in the accompanying consolidated financial statements. Third party participations in the Shareholders' equity and net results of those companies are recorded separately in the consolidated balance sheet and in the consolidated profit and loss statement, respectively, under the caption 'Non-controlling interests'.
Total comprehensive income is attributed to the owners of the Shareholders of parent company and the non-controlling interests even if this results in a deficit balance of noncontrolling interests.
In the acquisition of subsidiaries, the purchase method is applied. The results of subsidiaries bought or sold during the year are included in the profit and loss statement as from the date of acquisition (or of control acquisition) or up to the date of sale (or of control cession). Intra-Group transactions, balances and dividends are eliminated.
The expenses incurred with the acquisition of investments in Group companies are recorded as cost when they are incurred.
The fully consolidated companies are listed in note 2.
Investments in associated companies correspond to investments in which the Group has significant influence (generally investments representing between 20% and 50% of a company's share capital) and are recorded using the equity method.
In accordance with the equity method, investments are adjusted annually by the amount corresponding to the Group's share of the net results of associated companies, against a corresponding entry to gain or loss for the year, and by the amount of dividends received, as well as by other changes in the equity of the associated companies, which are recorded by a corresponding entry under the caption 'Other reserves'. An assessment of the investments in associated companies is
performed annually, with the aim of detecting possible impairment situations.
When the Group's share of accumulated losses of an associated company exceeds the book value of the investment, the investment is recorded at nil value, except when the Group has assumed commitments to the associated company, a situation when a provision is recorded under the caption 'Provisions for other liabilities and charges'.
Investments in associated companies are listed in note 4.
The financial statements of companies jointly controlled have been consolidated in the accompanying financial statements by the proportional method, since their acquisition date. According to this method, assets, liabilities, income and costs of these companies have been included into the accompanying consolidated financial statements, in the proportion attributable to the Group.
The excess of cost in relation to the fair value of identifiable assets and liabilities of the jointly controlled companies at the time of their acquisition was recorded as Goodwill (note 9). If the difference between cost and the fair value of the net assets and liabilities acquired is negative, it is recognised as income of the period, after reconfirmation of the fair value of the identifiable assets and liabilities.
The transactions, balances and dividends distributed among Group companies and jointly controlled companies are eliminated in the proportion attributable to the Group.
The classification of financial investments as jointly controlled is determined, among other things, on the Shareholders' Agreements that govern the jointly controlled companies.
A description of the companies jointly controlled is disclosed in note 3.
Tangible assets are recorded at their acquisition cost less accumulated depreciation and less estimated accumulated impairment losses.
Depreciations are calculated on a straight-line monthly basis as from the date the assets are available for use in the necessary conditions to operate as intended by the management, by a corresponding charge under the profit and loss statement caption 'Depreciation and amortisation'.
Impairment losses detected in the realisation value of tangible assets are recorded in the year in which they arise, by a corresponding charge under the caption 'Depreciation and amortisation' in the profit and loss statement.
The annual depreciation rates used correspond to the estimated useful life of the assets, which are as follows:
| Years of useful life |
|
|---|---|
| Buildings | 50 |
| Other constructions | 10 -40 |
| Networks | 10 -40 |
| Other plant and machinery | 1 - 16 |
| Vehicles | 4 |
| Fixtures and fittings | 1 -10 |
| Tools | 4 - 8 |
| Other tangible assets | 4 - 8 |
During the period ended at 30 September 2011, the Board of Directors of the Group proceeded with prospective effect to the revision of the estimated useful life of a set of assets related to the telecommunications networks and mobile telephones, based on evaluation reports produced by specialised independent agencies.
Current maintenance and repair costs of fixed assets are recorded as costs in the year in which they occur. Improvements of significant amount, which increase the estimated useful life of the assets, are capitalised and depreciated in accordance with the remaining estimated useful life of the corresponding assets.
The estimated costs related with the mandatory dismantling and removal of tangible assets, incurred by the Group, are capitalised and amortised in accordance with the estimated useful life of the corresponding assets.
Work in progress corresponds to fixed assets still in the construction/development stage which are recorded at their acquisition cost. These assets are depreciated as from the moment they are in condition to be used and when they are ready to start operating as intended by the management. Good conditions in terms of network coverage and / or necessary quality and technical reliability to ensure minimum services are examples of conditions evaluated by the management.
Intangible assets are recorded at their acquisition cost less accumulated amortisation and less estimated accumulated impairment losses. Intangible assets are only recognised if it is likely that they will bring future economic benefits to the Group, if the Group controls them and if their cost can be reasonably measured.
Intangible assets comprise, essentially, software (excluding the one included in tangible assets – telecommunication sites' software), industrial property, costs incurred with the mobile network operator licenses (GSM, UMTS and Spectrum for 4th generation services) and the fixed network operator licenses,
as well as the costs incurred with the acquisition of customers' portfolios (value attributed under the purchase price allocation in business combinations) and the costs related to customers' loyalty contracts.
Amortisations of intangible assets are calculated on a straightline monthly basis, over the estimated useful life of the assets (one to six years), as from the month in which the corresponding expenses are incurred. Mobile and fixed network operator licenses are amortised over the estimated period for which they were granted, so, the UMTS license is being amortised until 2030 and the LTE license until 2041. Additional license costs, namely the ones related to the commitments assumed by the Group under the UMTS license, regarding the contributions to the 'Information Society', are being amortised up to the estimated useful life of the license above indicated. The amortisation of the customer's portfolios is provided on a straight-line basis over the estimated average retention period of the customers (six years).
Expenditures with internally-generated intangible assets, namely research and development expenditures, are recognised in the profit and loss statement when incurred. Development expenditures can only be recognised as an intangible asset if the Group demonstrates the ability to complete the project and is able to put it in use or available for sale.
The costs incurred for customers' loyalty contracts, which include compensation clauses in the event of early termination, are capitalized as 'Intangible Assets' and amortised over the period of their contracts. When a contract is terminated, the net value of intangible assets associated with this contract is immediately recognised as an expense in the income statement. Additionally, with the perceived relevant frequency, impairment tests will be made to ensure that the current value of the estimated revenues is greater than the amount that is capitalised.
Amortisation for the period is recorded in the profit and loss statement under the caption 'Depreciation and amortisation'.
Brands and patents are recorded at their acquisition cost and are amortised on a straight-line basis over their respective estimated useful life. When the estimated useful life is undetermined, they are not depreciated but are subject to annual impairment tests.
Sonaecom Group does not hold any brands or patents with undetermined useful life, therefore the second half of the above referred paragraph is not applicable.
The differences between the price of investments in subsidiaries and associated companies added the value of non-controlling interests, and the amount attributed to the fair value of the identifiable assets and liabilities at the time of their acquisition, when positive, are recorded under the caption 'Goodwill', and, when negative, after a reappreciation of its calculation, are recorded directly in the profit and loss statement. The Group will chose, on an acquisition-byacquisition basis, to measure non-controlling interests either at their proportionate interest on the fair value of the assets and liabilities acquired, or at the fair value of the noncontrolling interests themselves. Until 1 January 2010, non- -controlling interests were always measured at their proportionate interest on the fair value of the acquired assets and liabilities.
Contingent consideration is recognised as a liability, at the acquisition-date, according to its fair value, and any changes to its value are recorded as a change in the 'Goodwill', but only as long as they occur during the 'measurement period' (until 12 months after the acquisition-date) and as long as they relate to facts and circumstances that existed at the acquisition date, otherwise these changes must be recognised in profit or loss.
Transactions regarding the acquisition of additional interests in a subsidiary after control is obtained, or the partial disposal of an investment in a subsidiary while control is retained, are accounted for as equity transactions impacting the shareholders funds captions, and without giving rise to any additional 'Goodwill' and without any gain or loss recognised.
The moment a sales transaction to generate a loss of control, should be derecognised assets and liabilities of the entity and any interest retained in the entity sold should be remeasured at fair value and any gain or loss calculated on the sale is recorded in results.
Until 1 January 2004, 'Goodwill' was amortised over the estimated period of recovery of the investments, usually 10 years, and the annual amortisation was recorded in the profit and loss statement under the caption 'Depreciation and amortisation'. Since 1 January 2004 and in accordance with the IFRS 3 – 'Business Combinations', the Group has ceased the amortisation of the 'Goodwill', subjecting them to impairment tests (paragraph x). Impairment losses of Goodwill are recorded in the profit and loss statement for the period under the caption 'Depreciation and amortisation'.
The Group classifies its financial instruments in the following categories: 'financial assets at fair value through profit or loss', 'loans and receivables', 'held-to-maturity investments', and 'available-for-sale financial assets'. The classification depends on the purpose for which the investments were acquired.
The classification of the investments is determined at the initial recognition and re-evaluated every quarter.
This category has two sub-categories: financial assets held for trading and those designated at fair value through profit or loss at inception. A financial asset is classified in this category if it has been acquired mainly with the purpose of selling it in the short term or if the adoption of this method allows reducing or eliminating an accounting mismatch. Derivatives are also registered as held for trading unless they are designated as hedges. Assets in this category are classified as current assets if they are either held for trading or are expected to mature within 12 months of the balance sheet date.
Loans and receivables are non-derivative financial assets with fixed or variable payments that are not quoted in an active market. These financial investments arise when the Group provides money, goods or services directly to a debtor with no intention of trading the receivable.
Loans and receivables are carried at amortised cost using the effective interest method, deducted from any impairment losses.
Loans and receivables are recorded as current assets, except when their maturity is greater than 12 months from the balance sheet date, a situation in which they are classified as non-current assets. Loans and receivables are included in the captions 'Trade debtors' and 'Other current debtors' in the balance sheet.
Held-to-maturity investments are non-derivative financial assets with fixed or variable payments and with fixed maturities that the Group's management has the positive intention and ability to hold until their maturity.
Available-for-sale financial assets are non-derivative investments that are either designated in this category or not classified in any of the other above referred categories. They are included in non-current assets unless management intends to dispose them within 12 months of the balance sheet date.
Purchases and sales of investments are recognised on tradedate – the date on which the Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. The 'Financial assets at fair value through profit or loss' are initially recognised at fair value and
the transaction costs are recorded in the profit and loss statement. Investments are derecognised when the rights to receive cash flows from the investments have expired or all substantial risks and rewards of their ownership have been transferred.
'Available-for-sale financial assets' and 'Financial assets at fair value through profit or loss' are subsequently carried at fair value.
'Loans and receivables' and 'Held-to-maturity investments' are carried at amortised cost using the effective interest method.
Realised and unrealised gains and losses arising from changes in the fair value of financial assets classified at fair value through profit or loss are recognised in the profit and loss statement. Realised and unrealised gains and losses arising from changes in the fair value of non-monetary securities classified as available-for-sale are recognised in equity. When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments are included in the profit and loss statement as gains or losses from investment securities.
The fair value of quoted investments is based on current bid prices. If the market for a financial asset is not active (and for unlisted securities), the Group establishes fair value by using other valuation techniques. These include the use of recent arm's length transactions, reference to similar instruments, discounted cash flow analysis, and option pricing models refined to reflect the issuer's specific circumstances. If none of these techniques can be used, the Group values those investments at cost net of any identified impairment losses. The fair value of listed investments is determined based on the closing Euronext share price at the balance sheet date.
The Group assesses at each balance sheet date whether there is objective evidence that a financial asset or a group of financial assets is impaired. In case of equity securities classified as available-for-sale, a significant (above 25%) or prolonged (in two consecutive quarters) decline in the fair value of the security below its cost is considered in determining whether the securities are impaired. If such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment losses on that financial asset previously recognised in profit or loss – is removed from equity and recognised in the profit and loss statement.
Lease contracts are classified as financial leases, if, in substance, all risks and rewards associated with the detention of the leased asset are transferred by the lease contract or as operational leases, if, in substance, there is no transfer of risks and rewards associated with the detention of the leased assets.
The lease contracts are classified as financial or operational in accordance with the substance and not with the form of the respective contracts.
Fixed assets acquired under finance lease contracts and the related liabilities are recorded in accordance with the financial method. Under this method the tangible assets, the corresponding accumulated depreciation and the related liability are recorded in accordance with the contractual financial plan at fair value or, if less, at the present value of payments. In addition, interests included in lease payments and the depreciation of the tangible assets are recognised as expenses in the profit and loss statement for the period to which they relate.
Assets under long-term rental contracts are recorded in accordance with the operational lease method. In accordance with this method, the rents paid are recognised as an expense, over the rental period.
Inventories are stated at their acquisition cost, net of any impairment losses, which reflects their estimated net realisable value.
Accumulated inventory impairment losses reflect the difference between the acquisition cost and the realisable amount of inventories, as well as the estimated impairment losses due to low turnover, obsolescence and deterioration, and are registered in profit and loss statement, in 'Cost of sales'.
Trade and other current debtors are recorded at their net realisable value and do not include interests, since the discount effect is not significant.
These financial instruments arise when the Group provides money, supplies goods or provides services directly to a debtor with no intention of trading the receivable.
The amounts of these captions are presented net of any impairment losses and are registered in profit and loss statement in heading 'Provisions and accumulated impairment losses'. Future reversals of impairment losses are recorded in the profit and loss statement under the caption 'Other operating revenues'.
Amounts included under the caption 'Cash and cash equivalents' correspond to amounts held in cash and term bank deposits and other treasury applications where the risk of change in value is insignificant.
The consolidated cash flow statement has been prepared in accordance with IAS 7, using the direct method. The Group classifies, under the caption 'Cash and cash equivalents', investments that mature in less than three months, for which the risk of change in value is insignificant. The caption 'Cash and cash equivalents' in the cash flow statement also includes bank overdrafts, which are reflected in the balance sheet caption 'Short-term loans and other loans'.
The cash flow statement is classified by operating, financing and investing activities. Operating activities include collections from customers, payments to suppliers, payments to personnel and other flows related to operating activities. Cash flows from investing activities include the acquisition and sale of investments in associated and subsidiary companies, as well as receipts and payments resulting from the purchase and sale of fixed assets. Cash flows from financing activities include payments and receipts relating to loans obtained and finance lease contracts.
All amounts included under this caption are likely to be realised in the short term and there are no amounts given or pledged as guarantee.
Loans are recorded as liabilities by the 'amortised cost'. Any expenses incurred in setting up loans are recorded as a deduction to the nominal debt and recognised during the period of the loan, based on the effective interest rate method. The interests incurred but not yet due are added to the loans caption until their payment.
Financial expenses relating to loans obtained are generally recognised as expenses at the time they are incurred. Financial expenses related to loans obtained for the acquisition, construction or production of fixed assets are capitalised as part of the cost of the assets. These expenses are capitalised starting from the time of preparation for the construction or development of the asset and are interrupted when the assets are ready to operate, at the end of the production or construction phases or when the associated project is suspended.
The Group only uses derivatives in the management of its financial risks to hedge against such risks. The Group does not use derivatives for trading purposes.
The cash flow hedges used by the Group are related to:
In cases where the hedge instrument is not effective, the amounts that arise from the adjustments to fair value are recorded directly in the profit and loss statement.
At 30 September 2012, the Group did not have any derivative, in addition to those mentioned in note 1.y).
Provisions are recognised when, and only when, the Group has a present obligation (either legal or implicit) resulting from a past event, the resolution of which is likely to involve the disbursement of funds by an amount that can be reasonably estimated. Provisions are reviewed at the balance sheet date and adjusted to reflect the best estimate at that date.
Provisions for restructurings are only registered if the Group has a detailed plan and if that plan has already been communicated to the parties involved.
Contingent liabilities are not recognised in the consolidated financial statements but are disclosed in the notes, if the possibility of a cash outflow affecting future economic benefits is not remote.
Contingent assets are not recognised in the consolidated financial statements but are disclosed in the notes when future economic benefits are likely to occur.
'Income tax' expense represents the sum of the tax currently payable and deferred tax. Income tax is recognised in accordance with IAS 12 – 'Income Taxes'.
Sonaecom has adopted, since 1 January 2008, the special regime for the taxation of groups of companies, under which, the provision for income tax is determined on the basis of the estimated taxable income of all the companies covered by that regime, in accordance with such rules. The special regime for the taxation of groups of companies covers all subsidiaries on which the Group holds at least 90% of their share capital, with its headquarters located in Portugal and subject to Corporate Income Tax (IRC). The remaining Group companies not covered by the special regime for the taxation of groups of companies are taxed individually based on their respective taxable income, in accordance with the tax rules in force in the location of the headquarters of each company.
Deferred taxes are calculated using the liability method and reflect the timing differences between the amount of assets and liabilities for accounting purposes and the respective amounts for tax purposes.
Deferred tax assets are only recognised when there is reasonable expectation that sufficient taxable profits shall arise in the future to allow such deferred tax assets to be used. At the end of each year the recorded and unrecorded deferred tax assets are revised and they are reduced whenever their realisation ceases to be probable, or increased if future taxable profits are, likely, enabling the recovery of such assets (note 11).
Deferred taxes are calculated with the tax rate that is expected to be in force at the time the asset or liability will be used.
Whenever deferred taxes derive from assets or liabilities directly registered in Shareholders' funds, its recording is also made under the Shareholders' funds caption. In all other situations, deferred taxes are always recorded in the profit and loss statement.
Subsidies awarded to finance personnel training are recognised as income during the period in which the Group incurs the associated costs and are included in the profit and loss statement under the caption 'Other operating revenues'.
Subsidies awarded to finance investments are recorded as deferred income and are included in the profit and loss statement under the caption 'Other operating revenues'. If subsidies awarded are used to finance investments in tangible assets, they are recorded in the profit and loss statement during the estimated useful life of the corresponding assets. If the subsidies awarded are used to finance other investments then they are recorded as the investment expenditure is incurred.
Expenses and income are recorded in the period to which they relate, regardless of their date of payment or receipt. Estimated amounts are used when actual amounts are not known.
The captions of 'Other non-current assets', 'Other current assets', 'Other non-current liabilities' and 'Other current liabilities' include expenses and income relating to the current period, where payment and receipt will occur in future periods, as well as payments and receipts in the current period but which relate to future periods. The latter shall be included by the corresponding amounts in the results of the periods that they relate to.
The costs attributable to current year and whose expenses will only occur in future years are estimated and recorded under the caption 'Other current liabilities' and 'Other non-current liabilities', when it is possible to estimate reliably the amount and the timing of occurrence of the expense. If there is uncertainty regarding both the date of disbursement of funds, and the amount of the obligation, the value is classified as Provisions (note 1.p)).
Revenue from telecommunications services is recognised in the period in which it occurs. Such services are invoiced on a monthly basis. Revenues not yet invoiced, from the last invoicing cycle to the end of the month, are estimated and recorded based on actual traffic. Differences between the estimated and actual amounts, which are usually not material, are recorded in the following period.
Sales revenues are recognised in the consolidated profit and loss statement when the significant risks and rewards associated with the ownership of the assets are transferred to the buyer and the amount of the corresponding revenue can be reasonably quantified. Sales are recognised before taxes and net of discounts.
The income related to pre-paid cards is recognised whenever the minutes are used. At the end of each period the minutes still to be used are estimated and the amount of income associated with those minutes is deferred.
Costs relating to customer loyalty programmes, under which points are awarded by the subsidiary Optimus – Comunicações, S.A., are calculated taking into consideration the probability of the redemption of the points, and are recognised, as a deduction to income, at the time the points are granted, by a corresponding entry under the caption 'Other current liabilities'.
The revenues and costs of the consultancy projects developed in the information systems consultancy segment are recognised in each period, according to the percentage of completion method.
Non-current financial assets and liabilities are recorded at fair value and, in each period, the financial actualisation of the fair value is recorded in the profit and loss statement under the
captions 'Other financial expenses' and 'Other financial income'.
Dividends are recognised when the Shareholders' rights to receive such amounts are appropriately established and communicated.
Assets and liabilities due in more than one year from the date of the balance sheet are classified, respectively, as noncurrent assets and non-current liabilities.
In addition, considering their nature, the 'Deferred taxes' and the 'Provisions for other liabilities and charges', are classified as non-current assets and liabilities (notes 11 and 17).
Portuguese commercial legislation requires that at least 5% of the annual net profit must be appropriated to a 'Legal reserve', until such reserve reaches at least 20% of the share capital. This reserve is not distributable, except in case of liquidation of the Company, but may be used to absorb losses, after all the other reserves are exhausted, or to increase the share capital.
The share premiums relate to premiums generated in the issuance of capital or in capital increases. According to Portuguese Commercial law, share premiums follow the same requirements of 'Legal reserves', ie, they are not distributable, except in case of liquidation, but they can be used to absorb losses, after all the other reserves are exhausted or to increase share capital.
According to IFRS 2 – 'Share-based Payment', the responsibility related with the Medium Term Incentive Plans is registered under the heading of 'Reserves for Medium Term Incentive Plans', which are not distributable and which can not be used to absorb losses.
Hedging reserve reflects the changes in fair value of 'cashflow' hedges derivatives that are considered effective (note 1.o)) and it is non-distributable nor can it be used to absorb losses.
The own shares reserve reflects the acquisition value of the own shares and follows the same requirements of legal reserve.
Under Portuguese law, the amount of distributable reserves is determined in accordance with the individual financial
statements of the Company, presented in accordance with IAS / IFRS. Therefore, at 30 September 2012, Sonaecom, SGPS, S.A., have reserves which by their nature are considered distributable, amounted around Euro 161.9 million.
Own shares are recorded as a deduction of Shareholders' funds. Gains or losses arising from the sale of own shares are recorded under the heading 'Other reserves'.
All assets and liabilities expressed in foreign currency were translated into euro using the exchange rates in force at the balance sheet date.
Favourable and unfavourable foreign exchange differences resulting from changes in the rates in force at transaction date and those in force at the date of collection, payment or at the balance sheet date are recorded as income and expenses in the consolidated profit and loss statement of the year, in financial results.
Entities operating abroad with organisational, economic and financial autonomy are treated as foreign entities.
Assets and liabilities of the financial statements of foreign entities are translated into euro using the exchange rates in force at the balance sheet date, while expenses and income in such financial statements are translated into euro using the average exchange rate for the period. The resulting exchange differences are recorded under the Shareholders' funds caption 'Other reserves'.
Goodwill and adjustments to fair value generated in the acquisitions of foreign entities reporting in a functional currency other than euro are translated into euro using the exchange rates prevailing at the balance sheet date.
The following rates were used to translate into euro the financial statements of foreign subsidiaries and the balances in foreign currency:
| 2012 | 2011 | |||
|---|---|---|---|---|
| 30 | 30 | |||
| September | Average | September | Average | |
| Pounds Sterling | 1.2531 | 1.2321 | 1.1539 | 1.1478 |
| Brazilian Real | 0.3812 | 0.4082 | 0.3989 | 0.4366 |
| American Dollar | 0.7734 | 0.7812 | 0.7406 | 0.7112 |
| Polish Zloti | 0.2437 | 0.2378 | 0.2270 | 0.2493 |
| Australian Dollar | 0.8067 | 0.8081 | 0.7208 | 0.7389 |
| Mexican Peso | 0.0602 | 0.0591 | 0.0538 | 0.0592 |
| Egyptian Pound | 0.1276 | 0.1289 | 0.1252 | 0.1219 |
| Malaysian Ringgit | 0.2526 | 0.2520 | 0.2320 | 0.2349 |
| Chilean Peso | 0.0016 | 0.0016 | 0.0014 | 0.0015 |
| Singapore Dollar | 0.6310 | 0.6207 | 0.5685 | 0.5704 |
| Swiss Franc | 0.8265 | 0.8303 | 0.8217 | 0.8123 |
| Swedish Krona | 0.1184 | 0.1146 | - | - |
| South African Rand | 0.0934 | 0.0971 | - | - |
| Angolan Kwanza | 0.0081 | 0.0082 | - | - |
| Moroccan Dirham | 0.0902 | 0.0902 | - | - |
Impairment tests are performed at the date of each balance sheet and whenever an event or change of circumstances indicates that the recorded amount of an asset may not be recoverable. Whenever the book value of an asset is greater than the amount recoverable, an impairment loss is recognised and recorded in the profit and loss statement under the caption 'Depreciation and amortisation' in the case of fixed assets and goodwill, under the caption 'Other financial expenses' in the case of financial investments or under the caption 'Provisions and impairment losses', in relation to the other assets. The recoverable amount is the greater of the net selling price and the value in use. Net selling price is the amount obtainable upon the sale of an asset in a transaction within the capability of the parties involved, less the costs directly related to the sale. The value in use is the present value of the estimated future cash flows expected to result from the continued use of the asset and of its sale at the end of its useful life. The recoverable amount is estimated for each asset individually or, if this is not possible, for the cashgenerating unit to which the asset belongs.
Evidence of the existence of impairment in accounts receivables appears when:
For certain categories of financial assets for which it is not possible to determine the impairment for each asset
For Goodwill and Financial investments, the recoverable amount, calculated in terms of value in use, is determined based on the most recent business plans duly approved by the Group's Board of Directors. For Accounts receivables, the Group uses historical and statistical information to estimate the amounts in impairment. For Inventories, the impairment is calculated based on market evidence and several indicators of stock rotation.
The accounting treatment of Medium Term Incentive Plans is based on IFRS 2 – 'Share-based Payments'.
Under IFRS 2, when the settlement of plans established by the Group involves the delivery of Sonaecom's own shares, the estimated responsibility is recorded, as a credit entry, under the caption 'Medium Term Incentive Plans Reserve', within the heading 'Shareholders' funds' and is charged as an expense under the caption 'Staff expenses' in the profit and loss statement.
The quantification of this responsibility is based on fair value and is recognised over the vesting period of each plan (from the award date of the plan until its vesting or settlement date). The total responsibility, at any point of time, is calculated based on the proportion of the vesting period that has 'elapsed' up to the respective accounting date.
When the responsibilities associated with any plan are covered by a hedging contract, ie, when those responsibilities are replaced by a fixed amount payable to a third party and when Sonaecom is no longer the party that will deliver the Sonaecom shares, at the settlement date of each plan, the above accounting treatment is subject to the following changes:
(iv) In the profit and loss statement, the 'elapsed' proportion continues to be charged as an expense under the caption 'Staff expenses'.
For plans settled in cash, the estimated liability is recorded under the balance sheet captions 'Other non-current liabilities' and 'Other current liabilities' by a corresponding entry under the profit and loss statement caption 'Staff expenses', for the cost relating to the vesting period that has 'elapsed' up to the respective accounting date. The liability is quantified based on the fair value of the shares as of each balance sheet date.
When the liability is covered by a hedging contract, recognition is made in the same way as described above, but with the liability being quantified based on the contractually fixed amount.
Equity-settled plans to be liquidated through the delivery of shares of the parent company are recorded as if they were settled in cash, which means that the estimated liability is recorded under the balance sheet captions 'Other non-current liabilities' and 'Other current liabilities' by a corresponding entry under the profit and loss statement caption 'Staff expenses', for the cost relating to the deferred period elapsed. The liability is quantified based on the fair value of the shares as of each balance sheet date.
At 30 September 2012, two plans of Sonaecom share plans were covered through the detention of own shares. For 2011 Sonaecom shares plan, the Company signed with Sonae SGPS, SA a contract that agrees to the transfer of Sonaecom SGPS shares for employees and board members of the Group as requested of Sonaecom and under the MTIP of Sonaecom and fixed the shares' acquisition price. The impacts associated to the Medium Term Incentive Plans are registered, in the balance sheet, under the caption 'Medium Term Incentive Plans Reserve'. The cost is recognized under the profit and loss statement caption 'Staff expenses'.
Regarding the plans liquidated through the delivery of shares of the parent company, the company entered, for all plans, into hedging contracts with an external entity under which the acquisition price of those shares was fixed. Therefore, the responsibility is recorded based on that fixed price, proportionally to the period of time elapsed since the award date until the date of record, under the captions 'Other noncurrent liabilities' and 'Other current liabilities'. The cost is recognised on the income statement under the caption 'Staff expenses'.
Events occurring after the date of the balance sheet which provide additional information about conditions prevailing at the time of the balance sheet (adjusting events) are reflected in the consolidated financial statements. Events occurring
after the balance sheet date that provide information on postbalance sheet conditions (non-adjusting events), when material, are disclosed in the notes to the consolidated financial statements.
The most significant accounting estimates reflected in the consolidated financial statements of the periods ended at 30 September 2012 and 2011, are as follows:
Estimates used are based on the best information available during the preparation of the consolidated financial statements and are based on the best knowledge of past and present events. Although future events are neither foreseeable nor controlled by the Group, some could occur and have impact on such estimates. Changes to the estimates used by the management that occur after the approval date of these consolidated financial statements, will be recognised in net income, in accordance with IAS 8 – 'Accounting Policies, Changes in Accounting Estimates and Errors', using a prospective methodology.
The main estimates and assumptions in relation to future events included in the preparation of these consolidated financial statements are disclosed in the corresponding notes.
Due to its activities, the Group is exposed to a variety of financial risks such as market risk, liquidity risk and credit risk.
These risks arise from the unpredictability of financial markets, which affect the capacity of project cash flows and profits. The Group financial risk management, subject to a long-term ongoing perspective, seeks to minimise potential adverse effects that derive from that uncertainty, using, whenever it is possible and advisable, derivative financial instruments to hedge the exposure to such risks (note 1.o)).
The Group operates internationally, having subsidiaries that operate in countries with a different currency than Euro namely Brazil, United Kingdom, Poland, United States of America, Mexico, Australia, Egypt, Chile, Panama, Singapore
and Malaysia (branch) and so it is exposed to foreign exchange rate risk.
Foreign exchange risk management seeks to minimise the volatility of investments and transactions made in foreign currencies and contributes to reduce the sensitivity of Group results to changes in foreign exchange rates.
Whenever possible, the Group uses natural hedges to manage exposure, by offsetting credits granted and credits received expressed in the same currency. When such a procedure is not possible, the Group adopts derivative financial hedging instruments (note 1.o)).
The Group's exposure to foreign exchange rate risk, results essentially from the fact that some of its subsidiaries report in a currency different from euro, making the risk of operational activity immaterial.
Sonaecom's total debt is indexed to variable rates, exposing the total cost of debt to a high risk of volatility. The impact of this volatility on the Group results or on its Shareholders' funds is mitigated by the effect of the following factors (i) relatively low level of financial leverage; (ii) possibility to use derivative financial instruments that hedge the interest rate risk, as mentioned below; (iii) possible correlation between the level of market interest rates and economic growth having the latter a positive effect in other lines of the Group's consolidated results (particularly operational), and in this way partially offsetting the increase of financial costs ('natural hedge'); and (iv) the existence of stand alone or consolidated liquidity which is also bearing interest at a variable rate.
The Group only uses derivatives or similar transactions to hedge interest rate risks considered significant. Three main principles are followed in all instruments selected and used to hedge interest rate risk:
As all Sonaecom's borrowings (note 15) are at variable rates, interest rate swaps and other derivatives are used, when it is deemed necessary, to hedge future changes in cash flow relating to interest payments. Interest rate swaps have the financial effect of converting the respective borrowings from floating rates to fixed rates. Under the interest rate swaps, the Group agrees with third parties (banks) to exchange, in predetermined periods, the difference between the amount of interest calculated at the fixed contract rate and the floating rate at the time of re-fixing, by reference to the respective agreed notional amounts.
The counterparties of the derivative hedging instruments are limited to highly rated financial institutions, being the Group's policy, when contracting such instruments, to give preference to financial institutions that form part of its financing transactions. In order to select the counterparty for occasional operations, Sonaecom requests proposals and indicative prices from a representative number of banks in order to ensure adequate competitiveness of these operations.
In determining the fair value of hedging operations, the Group uses certain methods, such as option valuation and discounted future cash flow models, using assumptions based on market interest rates prevailing at the balance sheet date.
Comparative financial institution quotes for the specific or similar instruments are used as a benchmark for the valuation.
The fair value of the derivatives contracted, that are considered as fair value hedges or the ones that are considered not sufficiently effective for cash flow hedge (in accordance with the provisions established in IAS 39), are recognised under borrowings captions and changes in the fair value of such derivatives are recognised directly in the profit and loss statement for the year. The fair value of derivatives of cash flow hedge, that are considered effective according to IAS 39, are recognised under borrowing captions and changes in the fair value are recognised in equity.
Sonaecom's Board of Directors approves the terms and conditions of the financing with significant impact in the Group, based on the analysis of the debt structure, the risks and the different options in the market, particularly as to the type of interest rate (fixed / variable). Under the policy defined above, the Executive Committee is responsible for the decision on the occasional interest rate hedging contracts, through the monitoring of the conditions and alternatives existing in the market.
The existence of liquidity in the Group requires the definition of some policies for an efficient and secure management of the liquidity, allowing us to maximise the profitability and to minimise the opportunity costs related to that liquidity. The liquidity risk management has a threefold objective: (i) Liquidity, ie, to ensure the permanent access in the most
efficient way to obtain sufficient funds to settle current payments within the respective dates of maturity as well as any eventual not forecasted requests for funds, within the deadlines set for this; (ii) Safety, ie to minimise the probability of default in any reimbursement of application of funds; and (iii) Financial Efficiency, ie, to ensure that the Group maximises the value / minimises the opportunity cost of holding excess liquidity in the short term.
The main underlying policies correspond to the variety of instruments allowed, the maximum acceptable level of risk, the maximum amount of exposure by counterparty and the maximum periods for investments.
The existing liquidity in the Group should be applied to the alternatives and by the order described below:
The applications in the market are limited to eligible counterparties, with ratings previously established by the Board and limited to certain maximum amounts by counterparty.
The definition of maximum amounts intends to ensure that the application of liquidity in excess is made in a prudent way and taking into consideration the best practices in terms of bank relationships.
The maturity of applications should equal the forecasted payments (or the applications should be easily convertible, in the case of asset investments, to allow urgent and not estimated payments), considering a threshold for eventual deviations on the estimates. The threshold depends on the accuracy level of treasury estimates and would be determined by the business. The accuracy of the estimates is an important variable to quantify the amounts and the maturity of the applications in the market.
The maturity analysis for the loans obtained is presented in note 15.
The Group's exposure to credit risk is mainly associated with the accounts receivable related to current operational
activities. The credit risk associated to financial operations is mitigated by the fact that the Group, in respect to telecommunications operators, only negotiates with entities with high credit quality.
The management of this risk seeks to guarantee that the amounts owing are effectively collected within the periods negotiated without affecting the financial health of the Group. The Group uses credit rating agencies and has specific departments responsible for risk control, collections and management of processes in litigation, as well as credit insurances, which all contribute to the mitigation of credit risk. The amounts included in the financial statements related to trade debtors and other debtors, net of impairment losses, represent the maximum exposure of the Group to credit risk.
Group companies included in the consolidation through full consolidation method, their head offices, main activities, Shareholders and percentage of share capital held at 30 September 2012 and 2011, are as follows:
| Percentage of share capital held | |||||||
|---|---|---|---|---|---|---|---|
| 2012 | 2011 | ||||||
| Company (Commercial brand) | Head office | Main activity | Shareholder | Direct | Effective* | Direct | Effective* |
| Parent company SONAECOM, S.G.P.S., S.A. ('Sonaecom') |
Maia | Management of shareholdings. | – | – | – | – | – |
| Subsidiaries | |||||||
| Be Artis – Concepção, Construção e Gestão de Redes de Comunicações, S.A. ('Artis') |
Maia | Design, construction, management and exploitation of electronic communications networks and their equipment and infrastructure, management of technologic assets and rendering of related services. |
Sonae Telecom Sonaecom |
100% - |
100% - |
– 100% |
– 100% |
| Be Towering – Gestão de Torres de | Maia | Implementation, installation and | Sonae Telecom | 100% | 100% | – | – |
| Telecomunicações, S.A. ('Be Towering') | exploitation of towers and other sites for | Optimus | - | - | 100% | 100% | |
| the instalment of telecommunications | |||||||
| Cape Technologies Limited ('Cape Technologies') |
Dublin | Rendering of consultancy services in the area of information systems. |
We Do | 100% | 100% | 100% | 100% |
| Connectiv Solutions, Inc. ('Connectiv') (a) | Delaware | Rendering of consultancy services in the area of information systems. |
We Do US | 100% | 100% | – | – |
| Digitmarket – Sistemas de Informação, S.A. ('Digitmarket' – using the brand 'Bizdirect') |
Maia | Development of management platforms and commercialisation of products, services and information, with the internet as its main support. |
Sonae com SI | 75.10% | 75.10% | 75.10% | 75.10% |
| Infosystems – Sociedade de Sistemas de Informação, S.A. ('Infosystems') (b) |
Luanda | Rendering of services in the area of information and technology systems, in the telecommunication sector and others; development, commercialisation and distribution of software and related equipment's; design and development of management platforms and commercialisation of online products and |
Sonae com SI | 50% | 50% | – | – |
| Lugares Virtuais, S.A. ('Lugares Virtuais') |
Maia | Organisation and management of electronic online portals, content acquisition, management of electronic auctions, acquisition and deployment of products and services electronically and any related activities. |
Miauger | 100% | 100% | 100% | 100% |
| Mainroad – Serviços em Tecnologias de | Maia | Rendering of consultancy services in IT | Sonae com SI | 100% | 100% | 100% | 100% |
| Informação, S.A. ('Mainroad') Miauger – Organização e Gestão de Leilões Electrónicos, S.A. ('Miauger') |
Maia | areas. Organisation and management of electronic auctions of products and services on-line. |
Sonaecom | 100% | 100% | 100% | 100% |
| Optimus - Comunicações, S.A. ('Optimus') |
Maia | Implementation, operation, exploitation and offer of networks and rendering services of electronic comunications and related resources; offer and commercialisation of products and equipments of electronic communications. |
Sonae Telecom Sonaecom |
100% - |
100% - |
35.86% 64.14% |
35.86% 64.14% |
| PCJ - Público, Comunicação e Jornalismo, S.A. ('PCJ') |
Maia | Editing, composition and publication of periodical and non-periodical material and the exploration of radio and TV stations and studios. |
Sonaecom | 100% | 100% | 100% | 100% |
| Per-Mar – Sociedade de Construções, S.A. ('Per Mar') |
Maia | Purchase, sale, renting and operation of property and commercial establishments. |
Sonae Telecom Optimus |
100% - |
100% - |
– 100% |
– 100% |
| Praesidium Services Limited ('Praesidium Services') |
Berkshire | Rendering of consultancy services in the area of information systems. |
We Do UK | 100% | 100% | 100% | 100% |
| Público – Comunicação Social, S.A. ('Público') | Maia | Editing, composition and publication of periodical and non-periodical material. |
Sonaecom | 100% | 100% | 100% | 100% |
* Sonaecom effective participation
(a) Company adquired in April 2012.
(b) Company adquired in June 2012.
| Percentage of share capital held | |||||||
|---|---|---|---|---|---|---|---|
| 2012 | 2011 | ||||||
| Company (Commercial brand) | Head office | Main activity | Shareholder | Direct | Effective* | Direct | Effective* |
| Saphety Level – Trusted Services, S.A. ('Saphety') |
Maia | Rendering services, training, consultancy services in the area of communication, process and electronic certification of data; trade, development and representation of software. |
Sonae com SI | 86.995% | 86.995% | 86.995% | 86.995% |
| Sonaecom - Serviços Partilhados, S.A. ('Sonaecom SP') (c) |
Maia | Support, management consulting and administration, particularly in the areas of accounting, taxation, administrative procedures, logistics, human resources and training. |
Sonaecom | 100% | 100% | – | – |
| Sonae com – Sistemas de Informação, S.G.P.S., S.A. ('Sonae com SI') |
Maia | Management of shareholdings in the area of corporate ventures and joint ventures. |
Sonaecom | 100% | 100% | 100% | 100% |
| Sonaecom - Sistemas de Información Espanã, S.L. ('SSI Espanã') |
Madrid | Rendering of consultancy services in the area of information systems. |
Sonae com SI | 100% | 100% | 100% | 100% |
| Sonaecom BV | Amsterdam | Management of shareholdings. | Sonaecom | 100% | 100% | 100% | 100% |
| Sonae Telecom, S.G.P.S., S.A. ('Sonae Telecom') (d ) |
Maia | Management of shareholdings in the area of telecommunications. |
Sonaecom | 100% | 100% | 100% | 100% |
| Sonaetelecom BV | Amsterdam | Management of shareholdings. | Sonaecom | 100% | 100% | 100% | 100% |
| Sontária - Empreendimentos Imobiliários, S.A. ('Sontária') |
Maia | Realisation of urbanisation and building construction, planning, urban management, studies, construction and property management, buy and sale of properties and resale of purchased for that purpose. |
Sonae Telecom Sonaecom |
100% - |
100% - |
– 100% |
– 100% |
| SSI Angola, S.A. ('SSI Angola') (e) | Luanda | Rendering of services in the area of information and technology systems, in the telecommunication sector and others; development, commercialisation and distribution of software and related equipment's; design and development of management platforms and commercialisation of online products and |
Infosystems | 100% | 50% | – | – |
| Tecnológica Telecomunicações, LTDA. ('Tecnológica') |
Rio de Janeiro | Rendering of consultancy and technical assistance in the area of IT systemsand telecommunications |
We Do Brasil | 99.99% | 99.90% | 99.99% | 99.90% |
| We Do Consulting – Sistemas de Informação, S.A. ('We Do') |
Maia | Rendering of consultancy services in the area of information systems. |
Sonae com SI | 100% | 100% | 100% | 100% |
| Wedo do Brasil Soluções Informáticas, Ltda. ('We Do Brasil') |
Rio de Janeiro | Commercialisation of software and hardware; rendering of consultancy and technical assistance related to information technology and data processing. |
We Do 99.91% |
99.91% | 99.91% | 99.91% | |
| We Do Poland Sp. Z.o.o. ('We Do Poland') | Poznan | Rendering of consultancy services in the area of information systems. |
Cape Technologies | 100% | 100% | 100% | 100% |
| We Do Technologies Americas, Inc ('We Do US') Delaware | Rendering of consultancy services in the area of information systems. |
Cape Technologies | 100% | 100% | 100% | 100% | |
| We Do Technologies Australia PTY Limited ('We Do Asia') |
Sydney | Rendering of consultancy services in the area of information systems. |
Cape Technologies | 100% | 100% | 100% | 100% |
| We Do Technologies BV ('We Do BV') | Amsterdam | Management of shareholdings. | We Do | 100% | 100% | 100% | 100% |
| We Do Technologies BV – Malaysian Branch ('We Do Malásia') |
Kuala Lumpur | Rendering of consultancy services in the area of information systems. |
We Do BV | 100% | 100% | 100% | 100% |
| We Do Technologies Chile SpA ('We Do Chile') | Chile | Rendering of consultancy services in the area of information systems. |
We Do BV | 100% | 100% | 100% | 100% |
| We Do Technologies Egypt LLC ('We Do Egypt') Cairo | Rendering of consultancy services in the | We Do BV | 90% | 90% | 90% | 90% | |
| area of information systems. | Sonaecom BV Sonaetelecom BV |
5% 5% |
5% 5% |
5% 5% |
5% 5% |
||
| We Do Technologies (UK) Limited ('We Do UK') | Berkshire | Management of shareholdings. | We Do | 100% | 100% | 100% | 100% |
| We Do Technologies Mexico, S de R.L. ('We Do | Mexico City | Rendering of consultancy services in the | Sonaecom BV | 5% | 5% | 5% | 5% |
| Mexico') | area of information systems. | We Do BV | 95% | 95% | 95% | 95% | |
| We Do Technologies Panamá S.A. ('We Do Panamá') |
Panamá City | Rendering of consultancy services in the area of information systems. |
We Do BV | 100% | 100% | 100% | 100% |
| We Do Technologies Singapore PTE. LTD. ('We Do Singapura') |
Singapore | Rendering of consultancy services in the area of information systems. |
We Do BV | 100% | 100% | 100% | 100% |
Do Singapura')
* Sonaecom effective participation (c ) Company established in January 2012.
(d ) This company changed its name to OPTIMUS – SGPS, S.A., at 12 October 2012.
(e ) Company adquired in June 2012.
All the above companies were included in the consolidation in accordance with the full consolidation method under the terms of IAS 27 – 'Consolidated and Separate Financial Statements' (majority of voting rights, through the ownership of shares in the companies).
At 30 September 2012 and 2011, the Group jointly controls and consolidates through the proportional method the following companies:
| Percentage of share capital held | |||||||
|---|---|---|---|---|---|---|---|
| 2012 | 2011 | ||||||
| Company (Commercial brand) | Head office | Main activity | Shareholder | Direct | Effective* | Direct Effective* | |
| Unipress – Centro Gráfico, Lda. ('Unipress') | V.N. Gaia | Trade and industry of graphic design and publishing. |
Público | 50% | 50% | 50% | 50% |
| Sociedade Independente de Radiodifusão Sonora, S.A. ('S.I.R.S.' – using the brand name 'Rádio Nova') (a) |
Oporto | Sound broadcasting. Radio station. |
Público | 45% | 45% | - | - |
| Infosystems – Sociedade de Sistemas de Informação, S.A. ('Infosystems') |
Luanda | Rendering of services in the area of information and technology systems. |
Sonae com SI | 50% | 50% | - | - |
| SSI Angola, S.A. ('SSI Angola') | Luanda | Rendering of services in the area of information and technology systems. |
Infosystems | 100% | 50% | - | - |
*Sonaecom effective participation
(a) Company included in the consolidated financial statements in accordance with the equity method, in September 2011.
During the year ended at 31 December 2011, the consolidation of SIRS was changed from equity method to proportional method, considering the rights of governance attributed to Sonaecom under the company's shareholders agreements. This change did not have a significant impact on the consolidated financial statements at 30 September 2012 and at 31 December 2011.
At 30 September 2012 and 2011, the main impacts arising from the consolidation by the proportional method of the above mentioned entities, are as follows (debit / (credit)):
| 2012 | 2011 | |
|---|---|---|
| Non-current assets | 1,937,006 | 2,207,396 |
| Current assets | 1,147,409 | 937,956 |
| Non-current liabilities | (1,890,551) | (2,088,096) |
| Current liabilities | (496,938) | (460,816) |
| Net result | (176,744) | 167,892 |
| Total revenues | (1,507,215) | (1,317,671) |
| Total costs | 1,330,471 | 1,149,779 |
At 30 September 2011, this caption included an investment in an associated company, of which the head office, main activity, shareholder, percentage of share capital held and book value were as follows:
| Percentage of share capital held | |||||||
|---|---|---|---|---|---|---|---|
| 2012 | 2011 | Book value | |||||
| Company (Commercial brand) | Head office | Main activity | Shareholder | Direct Effective* | Direct Effective* | 2012 | 2011 |
| Associated companies: Sociedade Independente de Radiodifusão Sonora, S.A. ('S.I.R.S.' – using the brand name 'Rádio Nova') |
Oporto | Sound broadcasting. Radio station. |
Público | - - |
45% 45% |
(b) | (a) |
*Sonaecom effective participation
(a) Investment recorded at a nil book value.
(b) Company jointly controled in 30 September 2012 (note 3).
At 30 September 2011 the associated company was included in the consolidated financial statements in accordance with the equity method, as referred in note 1. b). It was not necessary to make any adjustments between the accounting policies of the associated company and the Group accounting policies, since there were no significant differences.
At 30 September 2011, the assets, liabilities, total revenues and net results of associated company were as follows:
| Company | Assets | Liabilities | Total revenues | Net results |
|---|---|---|---|---|
| 2011 | ||||
| Sociedade Independente de Radiodifusão Sonora, S.A. | 668,373 | 659,184 | 733,192 | 39,623 |
During the periods ended at 30 September 2012 and 2011, the following changes occurred in the composition of the Group:
| Shareholder | Subsidiary | Date | Share capital | Current % shareholding |
|---|---|---|---|---|
| 2012 | ||||
| Sonaecom | Sonaecom SP | Jan-12 | 50,000 EUR | 100% |
| Purchaser | Subsidiary | Date | % acquired | Current % shareholding |
|---|---|---|---|---|
| 2012 | ||||
| Wedo US | Connectiv | Apr-12* | 100% | 100% |
| Sonae com SI | Infosystems | Jun-12 | 50% | 50% |
| Infosystems | SSI Angola | Jun-12 | 100% | 100% |
* The contract's signature date was April 2012, with effects from 1 May 2012.
At 30 April 2012, the group acquired the entire share capital of Connectiv Solutions. Following that, the company started from 1 May 2012 to consolidate the financial statements using the full consolidation method.
Connectiv main activity is the rendering of consulting services in the area of information systems.
| (Ammounts expressed in Euro) | Values before acquisition |
Fair value |
|---|---|---|
| Acquired assets | ||
| Tangible assets | 625,785 | 625,785 |
| Other current debtors | 1,155,221 | 1,155,221 |
| Other assets | 116,717 | 116,717 |
| Cash and cash equivalents | 315,304 | 315,304 |
| 2,213,027 | 2,213,027 | |
| Acquired liabilities | ||
| Other creditors | 184,608 | 184,608 |
| Other liabilities | 1,144,459 | 1,144,459 |
| 1,329,067 | 1,329,067 | |
| Net assets and liabilities | 883,960 | 883,960 |
| Acquisition price | 9,419,742 | |
| Goodwill | 8,535,782 |
Following the acquisition of Connectiv Solutions, the company has made a preliminary assessment of the fair value of acquired assets and assumed liabilities, so the allocation of the purchase price is still subject to change until completion of the period of one year from the date of the acquisition (in accordance with IFRS 3, business combinations).
Nevertheless, the company does not expect significant changes in its financial position as a result from any changes to allocation made.
The acquisition price includes a deferred amount (USD 2 million) to be paid in 2013 and 2014 and a contingent amount to be paid annually, during 4 years, depending on revenues of the company.
As usual on mergers and acquisitions, also in the acquisition of Connectiv, there was a part of the acquisition price which was not possible to be allocated to the fair value of some identified assets and liabilities,that was considered as Goodwill. This Goodwill is related to a number of different elements, which cannot be individually quantified and isolated in a viable way and include, for example, synergies, qualified workforce, technical skills and market power. The total amount of this Goodwill will be considered as fiscal cost in Connectiv accounts, for a period of 15 years.
The contribution of Connectiv to the consolidated net income attributed to Sonaecom's Shareholders, in the period ended at 30 September 2012, was positive of Euro 751 thousand.
The detail of the referred contribution is as follows:
| (Ammounts expressed in Euro) | Contribution at 30 September 2012 |
|---|---|
| Total Revenues | 2,858,831 |
| Costs and losses | |
| External supplies and services | (412,361) |
| Staff expenses | (1,482,996) |
| Earnings before interest and taxes | 963,474 |
| Financial Results | (1,979) |
| Income Tax | (210,856) |
| Net income attributed to shareholders of parent company | 750,639 |
If Connectiv had been consolidated since 1 January 2012, the values of 'Pro-forma' consolidated operating revenues and net income, before non-controlling interests, for the period ended at 30 September 2012, would be as follows:
| (Ammounts expressed in Euro) | 30 September 2012 ('Pro-forma') |
|---|---|
| Consolidated operating revenues | 626,726,698 |
| Net income before non-controlling interests | 64,398,314 |
The contribution of Connectiv to the consolidated balance sheet of Sonaecom at 30 September 2012, which does not include the goodwill generated as a result of the acquisition of Connectiv, is as follows:
| (Ammounts expressed in Euro) | Contribution at 30 September 2012 |
|---|---|
| Assets | |
| Tangible Assets | 691,053 |
| Trade debtors | 1,045,815 |
| Cash and cash equivalents | 677,078 |
| Other assets | 356,031 |
| Total assets | 2,769,977 |
| Liabilities | |
| Other non-current Liabilities | 129,057 |
| Other current liabilities | 993,600 |
| Total liabilities | 1,122,657 |
| Net assets | 1,647,320 |
| Shareholder | Subsidiary | Date | % shareholding |
|---|---|---|---|
| 2011 | |||
| Público | M3G | Set-11 | 100% |
The movement in tangible assets and in the corresponding accumulated depreciation and impairment losses in the periods ended at 30 September 2012 and 2011 was as follows:
| 2012 | ||||||||
|---|---|---|---|---|---|---|---|---|
| Land, Buildings and | Plant and | Fixtures and | Other tangible | |||||
| other constructions | machinery | Vehicles | fittings | Tools | assets | Work in progress | Total | |
| Gross assets | ||||||||
| Balance at 31 December 2011 | 302,416,354 | 1,039,039,573 | 184,996 | 201,461,205 | 1,181,254 | 5,677,521 | 36,269,347 | 1,586,230,250 |
| New companies (note 5. b)) | – | – | – | 1,212,130 | – | – | – | 1,212,130 |
| Additions | 159,746 | 3,929,397 | 5,338 | 11,056,116 | 220 | 6,846 | 66,391,733 | 81,549,396 |
| Disposals | (321,035) | (44,675,989) | – | (699,397) | (3,794) | (18,892) | – | (45,719,107) |
| Transfers and write-offs | 4,435,467 | 51,658,815 | – | 1,897,902 | 599 | 37,717 | (67,283,017) | (9,252,517) |
| Balance at 30 September 2012 | 306,690,532 | 1,049,951,796 | 190,334 | 214,927,956 | 1,178,279 | 5,703,192 | 35,378,063 | 1,614,020,152 |
| Accumulated depreciation and impairment losses | ||||||||
| Balance at 31 December 2011 | 161,265,292 | 655,832,295 | 136,116 | 179,673,009 | 1,137,465 | 4,772,518 | – | 1,002,816,695 |
| New companies (note 5. b)) | – | – | – | 586,345 | – | – | – | 586,345 |
| Depreciation for the period | 6,002,099 | 42,965,392 | 25,608 | 13,322,085 | 9,013 | 314,923 | – | 62,639,120 |
| Disposals | (233,865) | (33,684,999) | – | (526,014) | (1,976) | (5,117) | – | (34,451,971) |
| Transfers and write-offs | (22,594) | (230,509) | – | (193,619) | – | – | – | (446,722) |
| Balance at 30 September 2012 | 167,010,932 | 664,882,179 | 161,724 | 192,861,806 | 1,144,502 | 5,082,324 | – | 1,031,143,467 |
| Net value | 139,679,600 | 385,069,617 | 28,610 | 22,066,150 | 33,777 | 620,868 | 35,378,063 | 582,876,685 |
| 2011 | ||||||||
| Land, Buildings and | Plant and | Fixtures and | Other tangible | |||||
| other constructions | machinery | Vehicles | fittings | Tools | assets | Work in progress | Total | |
| Gross assets | ||||||||
| Balance at 31 December 2010 | 293,165,987 | 1,035,279,721 | 185,510 | 191,447,203 | 1,164,237 | 5,543,321 | 40,982,832 | 1,567,768,811 |
| Additions | 57,983 | 4,758,751 | - | 11,030,984 | 8,970 | 2,016 | 38,325,834 | 54,184,538 |
| Disposals | (215,400) | (42,642,627) | (515) | (3,212,080) | (4,192) | - | - | (46,074,814) |
| Transfers and write-offs | 7,020,040 | 38,309,857 | - | (1,068,539) | 3,817 | 61,562 | (55,251,857) | (10,925,120) |
| Balance at 30 September 2011 | 300,028,610 | 1,035,705,702 | 184,995 | 198,197,568 | 1,172,832 | 5,606,899 | 24,056,809 | 1,564,953,415 |
| Accumulated depreciation and impairment losses | ||||||||
| Balance at 31 December 2010 | 153,589,162 | 647,567,969 | 103,516 | 169,023,979 | 1,124,067 | 3,990,377 | - | 975,399,070 |
| Depreciation for the period | 9,068,273 | 40,976,429 | 24,629 | 13,809,522 | 11,294 | 565,873 | - | 64,456,020 |
| Disposals | (97,734) | (35,609,844) | (268) | (3,185,270) | (1,824) | - | - | (38,894,940) |
| Transfers and write-offs | (1,021,257) | (5,179,465) | - | (3,523,379) | (4,002) | - | - | (9,728,103) |
| Balance at 30 September 2011 | 161,538,444 | 647,755,089 | 127,877 | 176,124,852 | 1,129,535 | 4,556,250 | - | 991,232,047 |
| Net value | 138,490,166 | 387,950,613 | 57,118 | 22,072,716 | 43,297 | 1,050,649 | 24,056,809 | 573,721,368 |
The additions that occurred during the periods ended at 30 September 2012 and 2011 included: assets associated with the UMTS operation (Universal Mobile Telecommunications Service), HSDPA (Kanguru Express), GSM (Global Standard for Mobile Communications), GPRS (General Packet Radio Service), FTTH (Fibre-to-the-Home) and LTE (Long Term Evolution), some of which are associated with ongoing projects, so it remains registered in 'Work in progress'.
During the periods ended at 30 September 2012 and 2011, disposals include the sale of a set of assets related with 2G, 3G and Micro-Wave network.
The acquisition cost of 'Tangible assets' and 'Intangible assets' held by the Group under finance lease contracts, amounted to Euro 35,808,739 and Euro 31,582,929 as of 30 September 2012 and 2011, and their net book value as of those dates amounted to Euro 19,692,191 and Euro 18,308,825, respectively.
At 30 September 2012, the heading 'Tangible assets' included an amount of Euro 25.2 million (2011: Euro 22.1 million) that relates to the net book value of the telecommunications equipment delivered to customers, under free lease agreements with a pre-defined period, which are being amortised over the duration of their contracts.
At 30 September 2012 and 2011, the heading 'Tangible assets' does not include any asset pledged or given as a guarantee for loans obtained, except for the assets acquired under financial lease contracts.
The transfers of the period include the transfer for 'Intangible Assets' of a set of assets that were hitherto classified as 'Tangible assets in progress' (note 7).
'Tangible assets in progress' at 30 September 2012 and 2011 were made up as follows:
| 2012 | 2011 | |
|---|---|---|
| Development of mobile/fixed network | 31,825,343 | 19,514,504 |
| Information systems | 127,418 | 402,928 |
| Other projects in progress | 3,425,302 | 4,139,377 |
| 35,378,063 | 24,056,809 |
At 30 September 2012 and 2011, the amounts of commitments to third parties relating to investments to be made were as follows:
| 2012 | 2011 | |
|---|---|---|
| Network | 22,691,379 | 35,219,603 |
| Information systems | 1,303,595 | 1,738,029 |
| 23,994,974 | 36,957,632 |
In the periods ended at 30 September 2012 and 2011, the movement occurred in Intangible assets and in the corresponding accumulated amortisation and impairment losses, was as follows:
| 2012 | ||||
|---|---|---|---|---|
| Brands and | ||||
| patents and | Intangible assets | |||
| other rights | Software | in progress | Total | |
| Gross assets | ||||
| Balance at 31 December 2011 (restated) | 361,690,451 | 296,368,784 | 117,812,807 | 775,872,042 |
| Additions | 19,622,677 | 859,246 | 11,596,985 | 32,078,908 |
| Transfers and write-offs | 66,528,946 | 17,834,683 | (89,830,509) | (5,466,880) |
| Balance at 30 September 2012 | 447,842,074 | 315,062,713 | 39,579,283 | 802,484,070 |
| Accumulated amortisation and impairment losses | ||||
| Balance at 31 December 2011 (restated) | 153,193,021 | 233,557,139 | – | 386,750,160 |
| Amortisation for the period | 32,132,678 | 15,985,448 | – | 48,118,126 |
| Transfers and write-offs | (12,147,534) | (215,934) | – | (12,363,468) |
| Balance at 30 September 2012 | 173,178,165 | 249,326,653 | – | 422,504,818 |
| Net value | 274,663,909 | 65,736,060 | 39,579,283 | 379,979,252 |
| 2011 | ||||
|---|---|---|---|---|
| Brands and | ||||
| patents and | Intangible assets | |||
| other rights | Software | in progress | Total | |
| Gross assets | ||||
| Balance at 31 December 2010 (restated) | 359,491,468 | 264,381,328 | 16,085,854 | 639,958,650 |
| Additions(restated) | 20,196,637 | 1,484,562 | 12,223,027 | 33,904,226 |
| Disposals | (97) | (63,288) | – | (63,385) |
| Transfers and write-offs | (12,711) | 22,817,370 | (21,707,010) | 1,097,649 |
| Balance at 30 September 2011 (restated) | 379,675,297 | 288,619,972 | 6,601,871 | 674,897,140 |
| Accumulated amortisation and impairment losses | ||||
| Balance at 31 December 2010(restated) | 137,409,894 | 211,641,924 | – | 349,051,818 |
| Amortisation for the period (restated) | 29,627,145 | 16,354,304 | – | 45,981,449 |
| Disposals | (97) | (33,678) | – | (33,775) |
| Transfers and write-offs | (36) | (326,395) | – | (326,431) |
| Balance at 30 September 2011 (restated) | 167,036,906 | 227,636,155 | – | 394,673,061 |
| Net value | 212,638,391 | 60,983,817 | 6,601,871 | 280,224,079 |
Under the agreed terms resulting from the grant of the UMTS License, Optimus – Comunicações, S.A., committed to contribute to the promotion and development of an 'Information Society' in Portugal. The total amount of the obligations assumed arose to Euro 274 million which will have to be realised until the end of 2015.
In accordance with the Agreement established on 5 June 2007 with the Ministry of Public Works, Transportation and Communications (MOPTC), part of these commitments, up to Euro 159 million, would be realised through own projects eligible as contributions to the 'Information Society' which will be incurred under the normal course of Optimus – Comunicações, S.A.'s business (investments in network and technology, if not directly related with the accomplishment of other obligations inherent to the attribution of the UMTS License, and activities of research, development and promotion of services, contents and applications). These own projects must be recognised by the MOPTC and by entities created specifically for this purpose. At 30 September 2012, the total amount was already incurred and validated by the above referred entities, so, at this date, there are no additional responsibilities related to these commitments. These charges were recorded in the attached financial statements at the moment the projects were carried out and the estimated costs became known.
The remaining commitments, up to Euro 116 million, will be realised, as agreed between Optimus – Comunicações S.A. and MOPTC, through contributions to the 'Iniciativas E' project (modem offers, discounts on tariffs, cash contributions, among others, assigned to the widespread use of broadband internet for students and teachers). These contributions are made through the 'Fund for the Information Society', now known as the 'Fundação para as Comunicações Móveis' (Foundation for Mobile Communications), established by the three mobile operators with businesses in Portugal. All responsibility is recognised as an additional cost of UMTS license, against an entry in the captions 'Other non-current liabilities' and 'Other current liabilities'. Thus, at 30 September 2012, all the responsibilities with such commitments are fully recorded in the attached consolidated financial statements
Intangible assets in the period ended at 30 September 2012, include an amount of approximately Euro 110 million, corresponding to the current value of future payments related with the acquisition of rights of use for frequency (spectrum) bands of 800 MHz, 1800 MHz and 2600 MHz, which will be used to develop 4th generation services (LTE - Long Term Evolution). The payable amount totals Euro 113 million. In January 2012, an amount of Euro 83 million was already paid. The remaining amount can be paid in five annual installments of Euro 6 million, having the company, at each annual payment, the option to anticipate the payment of the amount in debt.
During the period ended 30 September 2012, considering the availability of LTE (Long Term Evolution) technology (although subject to restrictions in some areas of the country) and the subsequent launching the commercial operation, a fraction of the present value of future payments related to the acquisition of rights of use for 4th generation frequencies services was transferred from work in progress and the amortization was started, for an estimated period until 2041. Besides the amount of LTE spectrum, the caption 'Brands and patents and other rights' includes an amount of about Euro 14.9 million (2011: Euro 17.6 million) that corresponds to the costs incurred for customers' loyalty contracts (note 1.e).
At 30 September 2012 and 2011, the Group kept recorded under the heading 'Intangible assets – brands and contents' the amounts of Euro 173,155,549 and Euro 184,066,702, respectively, that correspond to the investments net of depreciations made in the
development of the UMTS network, including: (i) Euro 54,755,258 (2011: Euro 57,755,546) related to the license; (ii) Euro 18,295,739 (2011: Euro 19,298,245) related to the agreement signed in 2002 between Oni Way and the other three mobile telecommunication operators with activity in Portugal; (iii) Euro 5,619,174 (2011: Euro 5,927,074) related to a contribution to the 'Fundação para as Comunicações Móveis'', established in 2007, under an agreement entered with 'MOPCT' and the three mobile telecommunication operators in Portugal; and (iv) Euro 89,807,058 (2011: Euro 96,151,171) related with the programme 'Initiatives E', these last two associated to the commitments assumed by the Group in relation to the 'Information Society'.
Intangible and tangible assets include interest and other financial expenses incurred, directly related to the construction of certain items of work in progress.
At 30 September 2012 and 2011, the total net amount of financial expenses capitalization amounted to Euro 9,624,964 and Euro 10,841,676, respectively. The amounts capitalised in the periods ended at 30 September 2012 and 2011 were Euro 1,353,244 and Euro 555,413, respectively. An interest capitalisation rate of 2.78% was used in 2012 (1.81% in 2011), which corresponds to the average interest rate supported by the Group.
The assessment of impairment for the main tangible and intangible assets, in the various segments, is carried out as described in note 9 ('Goodwill'), to the extent that such assets are closely related to the overall activity of the segment and consequently cannot be analysed separately.
At 30 September 2012 and 2011, the breakdown of financial instruments was as follows:
| 2012 | |||||
|---|---|---|---|---|---|
| Loans and receivables |
Investments available for sale |
Subtotal | Others not covered by IFRS 7 |
Total | |
| Non-current assets | |||||
| Investments available for sale (note 10) | – | 212,323 | 212,323 | – | 212,323 |
| – | 212,323 | 212,323 | – | 212,323 | |
| Current assets | |||||
| Trade debtors | 121,140,637 | – | 121,140,637 | – | 121,140,637 |
| Other current debtors | 23,058,548 | – | 23,058,548 | 6,374,128 | 29,432,676 |
| Cash and cash equivalents (note 12) | 68,966,622 | – | 68,966,622 | – | 68,966,622 |
| 213,165,807 | – | 213,165,807 | 6,374,128 | 219,539,935 |
| 2011 | |||||
|---|---|---|---|---|---|
| Loans and receivables |
Investments available for sale |
Subtotal | Others not covered by IFRS 7 |
Total | |
| Non-current assets | |||||
| Investments available for sale (note 10) | – | 212,323 | 212,323 | – | 212,323 |
| – | 212,323 | 212,323 | – | 212,323 | |
| Current assets | |||||
| Trade debtors | 133,201,825 | – | 133,201,825 | – | 133,201,825 |
| Other current debtors | 18,556,870 | – | 18,556,870 | 13,995,946 | 32,552,816 |
| Cash and cash equivalents (note 12) | 183,025,312 | – | 183,025,312 | – | 183,025,312 |
| 334,784,007 | – | 334,784,007 | 13,995,946 | 348,779,953 |
| 2012 | |||||
|---|---|---|---|---|---|
| Liabilities recorded at | Other financial | Others not | |||
| amortised cost | liabilities | Subtotal | covered by IFRS 7 | Total | |
| Non-current liabilities | |||||
| Medium and long-term loans net of short-term portion (note 15) | 195,153,922 | – | 195,153,922 | – | 195,153,922 |
| Other non-current financial liabilities (note 16) | – | 19,311,607 | 19,311,607 | – | 19,311,607 |
| Securitisation of receivables (note 18) | 5,000,000 | – | 5,000,000 | – | 5,000,000 |
| 200,153,922 | 19,311,607 | 219,465,529 | – | 219,465,529 | |
| Current liabilities | |||||
| Short-term loans and other loans (note 15) | 200,582,408 | – | 200,582,408 | – | 200,582,408 |
| Trade creditors | – | 156,687,700 | 156,687,700 | – | 156,687,700 |
| Other current financial liabilities (note 19) | – | 2,893,694 | 2,893,694 | – | 2,893,694 |
| Securitisation of receivables (note 18) | 19,915,612 | – | 19,915,612 | – | 19,915,612 |
| Other creditors | – | 2,715,360 | 2,715,360 | 10,600,873 | 13,316,233 |
| 220,498,020 | 162,296,754 | 382,794,774 | 10,600,873 | 393,395,647 | |
| 2011 | |||||
| Liabilities recorded at | Other financial | Others not | |||
| amortised cost | liabilities | Subtotal | covered by IFRS 7 | Total | |
| Non-current liabilities | |||||
| Medium and long-term loans net of short-term portion (note 15) | 319,067,408 | – | 319,067,408 | – | 319,067,408 |
| Other non-current financial liabilities (note 16) | – | 18,628,442 | 18,628,442 | – | 18,628,442 |
| Securitisation of receivables (note 18) | 24,914,706 | – | 24,914,706 | – | 24,914,706 |
| 343,982,114 | 18,628,442 | 362,610,556 | – | 362,610,556 | |
| Current liabilities | |||||
| Short-term loans and other loans (note 15) | 121,924,773 | – | 121,924,773 | – | 121,924,773 |
| Trade creditors | – | 155,791,136 | 155,791,136 | – | 155,791,136 |
| Other current financial liabilities (note 19) | – | 2,449,306 | 2,449,306 | – | 2,449,306 |
| Securitisation of receivables (note 18) | 19,764,541 | – | 19,764,541 | – | 19,764,541 |
| Other creditors | – | 2,938,907 | 2,938,907 | 21,938,698 | 24,877,605 |
| 141,689,314 | 161,179,350 | 302,868,664 | 21,938,698 | 324,807,362 |
Considering the nature of the balances, the amounts to be paid and received to/from 'State and other public entities' were considered outside the scope of IFRS 7. Also, the captions of 'Other current assets', 'Other non-current assets', 'Other current liabilities' and 'Other non-current liabilities' and were not included in this note, as the nature of such balances are not within the scope of IFRS 7.
For the periods ended at 30 September 2012 and 2011, the movements occurred in Goodwill were as follows:
| 2012 | 2011 | |
|---|---|---|
| Opening balance | 521,103,723 | 526,141,552 |
| Connectiv Acquisiton | 8,723,356 | – |
| Other movements of the period | 55,250 | (7,821) |
| Closing balance | 529,882,329 | 526,133,731 |
For the periods ended at 30 September 2012 and 2011, the caption 'Other movements of the period' includes, mainly, the exchange rate update of the Goodwill.
Goodwill at 30 September 2012 and 2011 was made up as follows:
| 2012 | 2011 | |
|---|---|---|
| Optimus | 485,092,375 | 485,092,375 |
| Público | 15,000,000 | 20,000,000 |
| Cape Technologies | 17,476,354 | 17,476,354 |
| Connectiv | 8,723,356 | – |
| We Do | 1,971,668 | 1,971,668 |
| Praesidium Services | 1,238,912 | 1,140,850 |
| Unipress | 321,698 | 321,698 |
| Per-Mar | 47,253 | 47,253 |
| Be Towering | 10,713 | 10,713 |
| SIRS | – | 72,820 |
| 529,882,329 | 526,133,731 |
The evaluation of the existence of impairment losses in Goodwill is made by taking into account the cash-generating units, based on the most recent business plans duly approved by the Group's Board of Directors, which are prepared attending to cash flow projections for periods of five years. The discount rates used were based on the estimated weighted average cost of capital, which depends on the business segment of each subsidiary, as indicated in the table below. In perpetuity, the Group considered a growth rate of around 3% and others considered more conservative. In situations where the measurement of the existence, or not, of impairment is made based on the net selling price, values of similar transactions and other proposals made are used.
| Discount rate | |
|---|---|
| Telecommunications | 9.50% |
| Multimedia | 12.00% |
| Information Systems | 14.00% |
At 30 September 2012 and 2011, this caption included investments classified as available-for-sale and was made up as follows:
| % | 2012 | 2011 | |
|---|---|---|---|
| Lusa – Agência de Notícias de Portugal, S.A. | 1.38% | 197,344 | 197,344 |
| VISAPRESS - Gestão de Conteúdos dos Média, CRL | 10.00% | 5,000 | 5,000 |
| Others | - | 9,979 | 9,979 |
| 212,323 | 212,323 |
During the periods ended at 30 September 2012 and 2011, the heading 'Investments available for sale' did not present any movements.
At 30 September 2012, these investments correspond to shareholdings of immaterial amount, in unlisted companies, in which the Group has no significant influence, and in which the acquisition cost of such investments is a reasonable estimation of their fair value, adjusted where applicable, by the respective impairment losses.
The assessment of impairment in the investments described above is performed through comparisons with the value of the percentage of share capital detained by the Group and with multiples of sales and EBITDA of companies of the same sector.
The financial information regarding these investments is detailed below (in thousands of euro):
| Assets | Shareholders' funds |
Gross debt | Turnover | Operational results |
Net income | |
|---|---|---|---|---|---|---|
| Lusa – Agência de Notícias de Portugal, S.A. (1) | 15,237 | 6,681 | 1,637 | 19,387 | 337 | 613 |
| VISAPRESS - Gestão de Conteúdos dos Média, CRL (1) | 22 | (35) | - | 53 | (18) | (18) |
(1) Amounts expressed in thousands euro at 31 December 2011.
Deferred tax assets at 30 September 2012 and 2011, amounted to Euro 96,296,946 and Euro 105,384,838, respectively, and arose, mainly, from tax losses carried forward, temporary differences and from differences between the accounting and tax amount of some fixed assets.
The movements in deferred tax assets in the periods ended at 30 September 2012 and 2011 were as follows:
| 2012 | 2011 | |
|---|---|---|
| Opening balance | 103,853,881 | 109,587,224 |
| Impact on results: | ||
| Movements of Deferred tax assets related with Tax losses | (2,539,860) | 988,860 |
| Deferred tax assets related to tax losses and temporary diferences of previous years | 9,805,396 | 11,374,939 |
| Adjustments in the conversion to IAS/IFRS | (5,050,839) | (4,113,018) |
| Movements in provisions not accepted for tax purposes and tax benefits | (287,899) | - |
| Temporary differences resultant of UMTS license | (273,772) | (96,865) |
| Temporary net differences between the tax and the accounting amount of certain fixed assets | (6,798,014) | (9,891,222) |
| Temporary differences arising from the securitisation of receivables (Optimus) | (2,415,000) | (2,415,000) |
| Sub-total effect on results (note 22) | (7,559,988) | (4,152,306) |
| Others | 3,053 | (50,080) |
| Closing balance | 96,296,946 | 105,384,838 |
At 31 December 2008, deferred tax assets were recognised in the amount of Euro 16.1 million with regard to the securitisation of future receivables completed in December 2008 (note 18). As a result of that operation, and in accordance with the provisions of Decreto-Lei nº 219/2001 (Decree-Law) of 4 August, an amount of Euro 100 million was generated from that operation and it was added for purposes of determining the taxable income for the year 2008, thereby generating a temporary difference between accounting and taxable income result, which led to the recognition of a deferred tax asset to the extent that its use was, with reasonable safety, probable. Until 30 September 2012, an amount of Euro 12.1 million was reversed corresponding to the reversal of the above referred temporary difference.
Deferred taxes related to the IAS / IFRS adjustments correspond to the temporary differences generated in the companies included in consolidation and result from the fact that IAS / IFRS conversion adjustments, recorded in these companies at 31 December 2009, already considered in consolidated financial statements under IAS / IFRS, from previous years, only be considered for tax purposes, linearly, for a period of five years between 2010 and 2014.
Deferred taxes related to the UMTS license refers to temporary differences related to the value of the UMTS license, of the subsidiary Optimus. In consolidated financial statements and in accordance with IAS / IFRS, the license was amortised linearly, by the estimated period of useful life. For tax purposes, until the year 2009, the UMTS license was amortised using, on the first five years of commercial operation, from 2004 to 2008, incremental monthly basis depending of the capacity of the network installed, which would be applied after the straight-line monthly basis until the term of the license. Thus, the group recorded deferred tax assets relating to the temporary differences between the value of the license for tax purposes and the value recorded in the consolidated financial statements.
At 30 September 2012 and 2011, assessments of the deferred tax assets to be recognised were made. Potential deferred tax assets were recorded to the extent that future taxable profits were expected to be generated against which the tax losses and deductible tax differences could be used. These assessments were made based on the most recent business plans duly approved by the Board of Directors of the Group companies, which are periodically reviewed and updated. The main criteria used in those business plans are described in note 9.
The rate used at 30 September 2012 and 2011, in Portuguese companies, to calculate the deferred tax assets relating to tax losses carried forward was 25%. The rate used to calculate the temporary differences, including provisions not accepted and impairment losses, was 26.5%. Tax benefits, related to deductions from taxable income, are considered at 100%, and in some cases, their full acceptance is dependent on the approval of the authorities that concede such tax benefits. It wasn't considered the state surcharge, as it was understood to be unlikely the taxation of temporary differences during the estimated period when the referred rate will be applicable. For foreign companies was used the rate in force in each country.
In accordance with the tax returns and other information prepared by the companies that have registered deferred tax assets, the detail of such deferred tax assets, by nature, at 30 September 2012 was as follows:
| Companies excluded of the tax group | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Nature | Companies included in the |
tax group Digitmarket | Cape Technologies We Do Brasil |
We Do USA | Sonecom Sistemas de Informação |
Espanha We Do Mexico | Total | Total Sonaecom Group |
|
| Tax losses: | |||||||||
| To be used until 2015 | 3,763,768 | - | - | - | - | - | - | - | 3,763,768 |
| To be used until 2021 | - | - | - | - | - | - | 103,918 | 103,918 | 103,918 |
| To be used until 2025 | - | - | - | - | - | 158,938 | - | 158,938 | 158,938 |
| To be used until 2030 | - | - | - | - | 142,929 | - | - | 142,929 | 142,929 |
| Unlimited utilisation | - | - | 134,506 | - | - | - | - | 134,506 | 134,506 |
| Tax losses | 3,763,768 | 134,506 | 142,929 | 158,938 | 103,918 | 540,291 | 4,304,059 | ||
| Tax provisions not accepted and other temporary differences | 35,550,018 | 33,346 | - | 311,374 | - | - | 192,906 | 537,626 | 36,087,644 |
| Tax benefits (SIFIDE) | 3,536,742 | - | - | - | - | - | - | - | 3,536,742 |
| Adjustments in the conversion to IAS/IFRS | 15,152,042 | 474 | - | - | - | - | - | 474 | 15,152,516 |
| Temporary differences arising from the securitisation of receivables | 4,025,000 | - | - | - | - | - | - | - | 4,025,000 |
| Differences between the tax and accounting amount of certain fixed a |
- | - | - | - | - | - | - | - | 33,177,205 |
| Others | - | - | - | (18,142) | 10,838 | - | 21,084 | 13,780 | 13,780 |
| Total | 62,027,570 | 33,820 | 134,506 | 293,232 | 153,767 | 158,938 | 317,908 | 1,092,171 | 96,296,946 |
At 30 September 2012 and 2011, the Group has other situations where potential deferred tax assets could be recognised, but since it is not expected that sufficient taxable profits will be generated in the future to cover those losses, such deferred tax assets were not recorded:
| 2012 | 2011 | |
|---|---|---|
| Tax losses | 26,602,333 | 43,848,475 |
| Temporary differences (provisions not accepted for tax purposes and other temporary diferences) | 34,124,365 | 27,701,479 |
| Others | 14,305,692 | 17,035,622 |
| 75,032,390 | 88,585,576 |
At 30 September 2012 and 2011, tax losses for which deferred tax assets were not recognised have the following due dates:
| Due date | 2012 | 2011 |
|---|---|---|
| 2011 | - | 1,491,189 |
| 2012 | 4,576,207 | 12,307,639 |
| 2013 | 13,846,284 | 13,849,849 |
| 2014 | 469,302 | 698,437 |
| 2015 | 3,523,602 | 6,478,655 |
| 2016 | 367,667 | 1,247,315 |
| 2017 | 162,167 | 1,772,700 |
| 2018 | 48,023 | 420,883 |
| 2019 | 331,156 | 1,460,177 |
| 2020 | 10,130 | 529,150 |
| 2021 | 61,946 | 80,962 |
| 2022 | 132,956 | - |
| 2025 | - | 175,543 |
| 2027 | 52,232 | - |
| 2030 | - | 129,538 |
| Unlimited | 3,020,661 | 3,206,438 |
| 26,602,333 | 43,848,475 |
The years 2016 and following are applicable to the subsidiaries incorporated in countries in which the reporting period of tax losses is greater than four years.
The deferred tax liabilities at 30 September 2012 and 2011 amounting to Euro 1,546,042 and Euro 5,366,134 respectively, result mainly from consolidation adjustments and from temporary differences between tax and accounting results of the tangible and intangible assets referred with the costs related to customers' loyalty contracts (note 1).
The movement that occurred in deferred tax liabilities in the periods ended at 30 September 2012 and 2011 were as follows:
| 2012 | 2011 (restated) |
|
|---|---|---|
| Opening balance (restated) | (5,186,711) | (5,559,170) |
| Impact on results: | ||
| Adjustments in the conversion to IAS/IFRS | - | (7,964) |
| Temporary differences between tax and accounting results of the intangible assets | 3,131,854 | 110,313 |
| Sub-total impact on results (note 22) | 3,131,854 | 102,349 |
| Others | 490,815 | 90,687 |
| Closing balance | (1,564,042) | (5,366,134) |
The reconciliation between the earnings before taxes and the taxes recorded for the periods ended at 30 September 2012 and 2011 is as follows:
| 2012 | 2011 (restated) |
|
|---|---|---|
| Earnings before taxes | 71,012,254 | 63,018,859 |
| Income tax rate (25%) | (17,753,064) | (15,754,715) |
| Deferred tax assets not recognised in the individual accounts and / or resulting from consolidation | ||
| adjustments and other adjustments to taxable income | (3,991,880) | (4,004,772) |
| Record/(reverse) of deferred tax assets related to previous years | 9,805,396 | 11,278,074 |
| Use of tax losses and tax benefits without record of deferred tax asset in previous years | 2,489,413 | – |
| Temporary differences for the period without record of deferred tax assets | 1,272,681 | 981,228 |
| Record of deferred tax liabilities | - | 24,541 |
| Temporary differences arising from the securitisation of receivables | 1,350,000 | 1,350,000 |
| Movements in the temporary differences between the tax and accounting amounts of the UMTS license | (273,771) | (96,865) |
| Income taxation recorded in the period (note 22) | (7,101,225) | (6,222,509) |
Portuguese Tax Authorities can review the income tax returns of the Company and of its subsidiaries with head office in Portugal for a period of four years (five years for Social Security), except when tax losses have been generated, tax benefits have been granted or when any review, claim or impugnation is in course, in which circumstances, the periods are extended or suspended. Consequently, tax returns of each year, since the year 2008 (inclusive) are still subject to such review. The Board of Directors believes that any correction that may arise as a result of such review would not have a significant impact on the accompanying consolidated financial statements.
For the year ended at 31 December 2010, the subsidiary Optimus was notified of the Report of Tax Inspection, where it considers that it is inappropriate the increase, when calculating the taxable profit for the year 2008, of the amount of Euro 100 million, with respect to initial price of future credits transferred to securitization. The Settlement Note, was receipt on April 2011, and Optimus will challenge that decision and is confidence of the Board of Directors of the Optimus and the Group that there are strong arguments to obtain a favorable decision for Optimus. For this reason, Optimus kept the recording of deferred tax assets associated with this operation.
Supported by the Company's lawyers and Tax consultants, the Board of Directors believes that there are no liabilities not provisioned in the consolidated financial statements, associated to probable tax contingencies that should have been registered or disclosed in the accompanying financial statements, at 30 September 2012.
At 30 September 2012 and 2011, the detail of cash and cash equivalents was as follows:
| 2012 | 2011 | |
|---|---|---|
| Cash | 496,718 | 111,362 |
| Bank deposits repayable on demand | 9,584,956 | 5,883,950 |
| Treasury applications | 58,884,948 | 177,030,000 |
| Cash and cash equivalents | 68,966,622 | 183,025,312 |
| Bank overdrafts (note 15) | (13,186,408) | (783,857) |
| 55,780,214 | 182,241,455 |
At 30 September 2012 and 2011, the 'Treasury applications' had the following breakdown:
| 2012 | 2011 | |
|---|---|---|
| Sonae Investments BV | 21,810,000 | 41,810,000 |
| Bank applications | 37,074,948 | 135,220,000 |
| 58,884,948 | 177,030,000 |
During the period ended at 30 September 2012, the above mentioned treasury applications bear interests at an average rate of 2.65% (2.61% in 2011).
At 30 September 2012 and 2011, the share capital of Sonaecom was comprised by 366,246,868 ordinary registered shares of 1 euro each. At those dates, the Shareholder structure was as follows:
| 2012 | 2011 | |||
|---|---|---|---|---|
| Number of | ||||
| shares | % | Number of shares | % | |
| Sontel BV | 194,063,119 | 52.99% | 194,063,119 | 52.99% |
| Shares traded on the Portuguese Stock Exchange ('Free float') | 75,977,185 | 20.74% | 76,737,177 | 20.95% |
| Atlas Service Belgium | 73,249,374 | 20.00% | 73,249,374 | 20.00% |
| Millennium BCP | 12,500,998 | 3.41% | 12,500,998 | 3.41% |
| Own shares | 7,025,192 | 1.92% | 9,045,200 | 2.47% |
| Sonae SGPS | 3,430,000 | 0.94% | 650,000 | 0.18% |
| Efanor Investimentos, S.G.P.S., S.A. | 1,000 | 0.00% | 1,000 | 0.00% |
| 366,246,868 | 100.00% | 366,246,868 | 100.00% |
All shares that comprise the share capital of Sonaecom, are authorised, subscribed and paid. All shares have the same rights and each share corresponds to one vote.
During the period ended at 30 September 2012, Sonaecom delivered to its employees 4,828,234 own shares under its Short and Medium Term Incentive Plan (1,764,157 own shares during the period ended at 30 September 2011).
Additionally, during the period ended at 30 September 2012, Sonaecom acquired 2,808,226 shares (at an average price of Euro 1.205), holding at 30 September 2012, 7,025,192 own shares, representative of 1.92% of its share capital at the average acquisition cost of Euro 1.370.
a) Medium and long-term loans net of short-term portion
| Amount outstanding |
||||||
|---|---|---|---|---|---|---|
| Type of | ||||||
| Company | Issue denomination | Limit | Maturity | reimbursement | 2012 | 2011 |
| Sonaecom | 'Obrigações Sonaecom SGPS 2005' | 150,000,000 | Jun-13 | Final | - | 150,000,000 |
| SGPS | 'Obrigações Sonaecom SGPS 2011' | 100,000,000 | Mar-15 | Final | 100,000,000 | 100,000,000 |
| 'Obrigações Sonaecom SGPS 2010' | 40,000,000 | Mar-15 | Final | 40,000,000 | 40,000,000 | |
| 'Obrigações Sonaecom SGPS 2010' | 30,000,000 | Feb-13 | Final | - | 30,000,000 | |
| 'Obrigações Sonaecom SGPS 2012' | 20,000,000 | Jul-15 | Final | 20,000,000 | – | |
| Costs associated with financing set-up | – | – | – | (2,173,132) | (3,089,220) | |
| Interests incurred but not yet due | – | – | – | 1,166,105 | 1,433,594 | |
| 158,992,973 | 318,344,374 | |||||
| Sonaecom | Commercial paper | 30,000,000 | Jul-15 | – | 30,000,000 | – |
| SGPS | Costs associated with financing set-up | – | – | – | (242,602) | – |
| Interests incurred but not yet due | – | – | – | 46,549 | – | |
| 29,803,947 | - | |||||
| WeDo USA | Bank loan | – | Apr-19 | – | 5,800,500 | – |
| Jun/Aug-13 | ||||||
| Unipress | Bank loan | – | and Jul-17 | – | 206,428 | 335,311 |
| Saphety | Minority Shareholder loans | – | – | – | 457,984 | 387,723 |
| Costs associated with financing set-up | – | – | – | (181,804) | – | |
| Interests incurred but not yet due | – | – | – | 73,894 | – | |
| 6,357,002 | 723,034 | |||||
| 195,153,922 | 319,067,408 |
| Amount outstanding |
||||||
|---|---|---|---|---|---|---|
| Type of | ||||||
| Company | Issue denomination | Limit | Maturity | reimbursement | 2012 | 2011 |
| Sonaecom SGPS | 'Obrigações Sonaecom SGPS 2005' | 150,000,000 | Jun-13 | Final | 150,000,000 | - |
| 'Obrigações Sonaecom SGPS 2010' | 30,000,000 | Feb-13 | Final | 30,000,000 | - | |
| 180,000,000 | - | |||||
| Sonaecom SGPS | Commercial paper | 150,000,000 | Jul-12 | – | - | 120,950,000 |
| Costs associated with financing set-up | – | – | – | - | (215,949) | |
| Interests incurred but not yet due | – | – | – | - | 406,865 | |
| - | 121,140,916 | |||||
| Sonaecom SGPS | Overdrafts facilities - CGD | 16,500,000 | – | – | 7,396,000 | - |
| Sonaecom SGPS | Bank overdrafts (note 12) | 10,000,000 | – | – | 9,996,000 | - |
| Sonaecom SGPS | Bank overdrafts (note 12) | 2,500,000 | – | – | 1,639,000 | - |
| Sonaecom SGPS | Bank overdrafts (note 12) | – | – | – | 1,002,994 | 338,305 |
| Several | Bank overdrafts (note 12) | – | – | – | 548,414 | 445,552 |
| 20,582,408 | 783,857 | |||||
| 200,582,408 | 121,924,773 | |||||
In June 2005, Sonaecom signed a Bond Loan, privately placed, amounting to Euro 150 million without guarantees and with a maturity of eight years. The bonds bear interest at floating rate, indexed to Euribor and paid semiannually. This issue was organised and mounted by Millennium BCP Investimento.
In February and March 2010, Sonaecom signed two other Bond Loan, both privately placed, in the amount of Euro 30 and 40 million, without guarantees and maturities of 3 and 5 years respectively. Both loans bear interest at floating rate indexed to Euribor, and paid semiannually. The issues were organised and mounted by, respectively, Banco Espirito Santo de Investimento and Caixa - Banco de Investimento. These bond issues were traded on Euronext Lisbon market.
In September 2011, Sonaecom signed a Bond Loan, privately placed, amounting to Euro 100 million without guarantees and with a maturity of three and half years. The bonds bear interest at floating rate, indexed to Euribor and paid semiannually. This issue was organised and mounted by BNP Paribas, ING Belgium SA/NV and WestLB AG.
In July 2012, Sonaecom signed a Bond Loan, privately placed, amounting to Euro 20 million without guarantees and with the maturity of three years. The bonds bear interest at floating rate, indexed to Euribor and paid semiannually. This issue was organised and mounted by Banco BPI.
All the loans above are unsecured and the fulfillment of the obligations under these loans is exclusively guaranteed by the underlying activities and the indebted company cash flows generation capacity.
The average interest rate of the bond loans, in the period, was 3.23% (2.74% in 2011).
In July 2007, Sonaecom contracted a Commercial Paper Programme Issuance with a maximum amount of Euro 250 million with subscription grant and maturity of five years, organised by Banco Santander de Negócios Portugal and by Caixa – Banco de Investimento. According to the original terms, this programme was reduced to the amount of Euro 150 million in July 2010.
The placing underwriting consortium is composed by the following institutions: Banco Santander Totta, Caixa Geral de Depósitos, Banco BPI, Banco Bilbao Vizcaya Argentaria (Portugal), Banco Comercial Português and BNP Paribas (in Portugal).
Additionally, Sonaecom has three other Commercial Paper Programmes, with subscription guarantee, with the following characteristics:
| Amount | Hire date | Subscription guarantee | Maturity |
|---|---|---|---|
| Euro 30 million | May 2012 | Caixa Geral de Depósitos | 31-Jul-2015 |
| Euro 25 million | July 2012 | Banco Santander Totta | 31-Jul-2013 |
| Euro 15 million | June 2010 | Caixa Económica Montepio Geral | 19-Jul-2013 |
| Euro 5 million | April 2010 | Banco BPI | Possibly renewable at 20-Apr-2013 |
All the loans above are unsecured and the fulfilment of the obligations under these loans is exclusively guaranteed by the underlying activities and the indebted company cash flows generation capacity.
On 30 September 2012, the main financial constraints (covenants) included in debt contracts are related with the bond issue completed by Sonaecom during September 2011, totalling Euro 100 million and establishing: (i) the requirement for Sonaecom, Optimus, Artis and Sonae Telecom, as well as the group companies whose both assets and EBITDA are equal or greater than 15% of the consolidated assets and the consolidated EBITDA (material subsidiaries) represent, as a whole, at least 80% of Sonaecom consolidated assets and consolidated EBITDA, and: (ii) the obligation to ensure that consolidated net debt does not exceed three times the consolidated EBITDA. Additionally, both this loan, as well as other loans are covered by Sonaecom negative pledge clauses, which impose certain restrictions on the mortgaging or pledging of the material subsidiaries' tangible assets and require the upholding of control over Optimus and Wedo USA (regarding this company bank loan). The penalties applicable in the event of default in these covenants are generally the early payment of the loans obtained.
On 30 September 2012, Sonaecom was fully compliant with all the financial constraints above mentioned.
Sonaecom has also short term bank credit lines, in the form of current or overdraft account commitments, in the amount of Euro 29 million. These credit lines have maturities up to one year, automatically renewable, except in case of termination by either party, with some periods of notice.
All these loans and bank credit lines bear interest at market rates, indexed to the Euribor for the respective term, and were all contracted in euro.
At 30 September 2012 and 2011, the repayment schedule of medium and long-term loans and of interests (nominal values), for both bonds and commercial paper were as follows (values based on the latest interest rate established for each type of loan):
| n+1 | n+2 | n+3 | n+4 | n+5 | |
|---|---|---|---|---|---|
| 2012 | |||||
| Bond loan: | |||||
| Reimbursements | - | - | 160,000,000 | - | - |
| Interests | 5,840,402 | 5,840,402 | 3,160,802 | - | - |
| Commercial paper: | |||||
| Reimbursements | - | - | 30,000,000 | - | - |
| Interests | 1,176,822 | 1,176,822 | 976,924 | - | - |
| 7,017,224 | 7,017,224 | 194,137,726 | - | - | |
| 2011 | |||||
| Bond loan: | |||||
| Reimbursements | – | 180,000,000 | – | 140,000,000 | – |
| Interests | 11,546,600 | 9,708,677 | 6,479,600 | 3,083,429 | – |
| Commercial paper: | |||||
| Reimbursements | – | – | – | – | – |
| Interests | – | – | – | – | – |
| 11,546,600 | 189,708,677 | 6,479,600 | 143,083,429 | – |
Although the maturity of commercial paper issuance is between one week to six months, the counterparties assumed the placement and the maintenance of those limits for a period of five years. As so, such liabilities are recorded in the medium and long term.
Minority Shareholder loans have no maturity defined.
At 30 September 2012 and 2011, the available credit lines of the Group were as follows:
| Maturity | ||||||
|---|---|---|---|---|---|---|
| Amount | More than 12 | |||||
| Company | Credit | Limit | outstanding | Amount available | Until 12 months | months |
| 2012 | ||||||
| Sonaecom | Commercial paper | 30,000,000 | 30,000,000 | - | x | |
| Sonaecom | Commercial paper | 25,000,000 | - | 25,000,000 | x | |
| Sonaecom | Commercial paper | 15,000,000 | - | 15,000,000 | x | |
| Sonaecom | Commercial paper | 5,000,000 | - | 5,000,000 | x | |
| Sonaecom | Bond loan | 150,000,000 | 150,000,000 | - | x | |
| Sonaecom | Bond loan | 100,000,000 | 100,000,000 | - | x | |
| Sonaecom | Bond loan | 40,000,000 | 40,000,000 | - | x | |
| Sonaecom | Bond loan | 30,000,000 | 30,000,000 | - | x | |
| Sonaecom | Bond loan | 20,000,000 | 20,000,000 | - | x | |
| Sonaecom | Overdraft facilities | 16,500,000 | 7,396,000 | 9,104,000 | x | |
| Sonaecom | Authorised overdrafts* | 10,000,000 | 9,996,000 | 4,000 | x | |
| Sonaecom | Authorised overdrafts | 2,500,000 | 1,639,000 | 861,000 | x | |
| SIRS | Authorised overdrafts | 150,000 | - | 150,000 | x | |
| WeDo USA | Bank loan | 5,800,500 | 5,800,500 | - | x | |
| Others | Several | - | 2,215,820 | - | x | x |
| 449,950,500 | 397,047,320 | 55,119,000 | ||||
| 2011 | ||||||
| Sonaecom | Commercial paper | 150,000,000 | 120,950,000 | 29,050,000 | x | |
| Sonaecom | Commercial paper | 30,000,000 | - | 30,000,000 | x | |
| Sonaecom | Commercial paper | 15,000,000 | - | 15,000,000 | x | |
| Sonaecom | Commercial paper | 10,000,000 | - | 10,000,000 | x | |
| Sonaecom | Bond loan | 150,000,000 | 150,000,000 | - | x | |
| Sonaecom | Bond loan | 100,000,000 | 100,000,000 | - | x | |
| Sonaecom | Bond loan | 40,000,000 | 40,000,000 | - | x | |
| Sonaecom | Bond loan | 30,000,000 | 30,000,000 | - | x | |
| Sonaecom | Overdraft facilities | 16,500,000 | - | 16,500,000 | x | |
| Sonaecom | Authorised overdrafts | 2,500,000 | - | 2,500,000 | x | |
| Others | Several | - | 1,506,891 | - | x | x |
| 544,000,000 | 442,456,891 | 103,050,000 |
*Can also be used in the form of commercial paper
At 30 September 2012 and 2011, there are no interest rate hedging instruments therefore the total gross debit is exposed to changes in market interest rates.
At 30 September 2012 and 2011, this caption was made up of accounts payable to fixed and intangible assets suppliers related to lease contracts which are due in more than one year in the amount of Euro 19,311,607 and Euro 18,628,442, respectively.
At 30 September 2012 and 2011, the payment of these amounts was due as follows:
| 2012 | 2011 | |||
|---|---|---|---|---|
| Present value of | Present value of | |||
| Lease payments | lease payments | Lease payments | lease payments | |
| 2011 | – | – | 732,291 | 582,955 |
| 2012 | 1,223,374 | 783,070 | 3,449,984 | 2,537,661 |
| 2013 | 4,460,915 | 3,466,312 | 3,267,476 | 2,453,108 |
| 2014 | 3,570,371 | 2,720,271 | 2,277,174 | 1,557,725 |
| 2015 | 3,437,207 | 2,721,259 | 2,208,055 | 1,557,807 |
| 2016 onwards | 15,272,768 | 12,514,390 | 15,139,366 | 12,388,492 |
| 27,964,635 | 22,205,301 | 27,074,346 | 21,077,748 | |
| Interests | (5,759,334) | – | (5,996,599) | – |
| 22,205,301 | 22,205,301 | 21,077,747 | 21,077,748 | |
| Short-term liability (note 19) | – | (2,893,694) | – | (2,449,306) |
| 22,205,301 | 19,311,607 | 21,077,747 | 18,628,442 | |
The medium and long-term agreements made with suppliers of optical fibre network capacity, under which the Group has the right to use that network, which is considered as a specific asset, are recorded as finance leases in accordance with IAS 17 –'Leases' and IFRIC 4 – 'Determining whether an arrangement contains a Lease'. These contracts have a 15 to 20 year maturity.
The movements in provisions and in accumulated impairment losses in the periods ended at 30 September 2012 and 2011 were as follows:
| Utilisations | |||||
|---|---|---|---|---|---|
| 2012 | Opening balance | Increases | and Transfers | Decreases | Closing balance |
| Accumulated impairment losses on accounts receivables | 78,700,909 | 17,061,471 | (15,861,376) | (40,300) | 79,860,704 |
| Accumulated impairment losses on inventories | 12,801,233 | 1,658,641 | (8,230,416) | – | 6,229,458 |
| Provisions for other liabilities and charges | 48,549,956 | 808,569 | (4,419,559) | (24,224) | 44,914,742 |
| 140,052,098 | 19,528,681 | (28,511,351) | (64,524) | 131,004,904 | |
| 2011 | |||||
| Accumulated impairment losses on accounts receivables | 70,410,631 | 16,015,126 | (14,113,938) | (476,184) | 71,835,635 |
| Accumulated impairment losses on inventories | 14,930,606 | 2,339,205 | (1,869,547) | – | 15,400,264 |
| Provisions for other liabilities and charges | 33,150,028 | 1,803,349 | (357,803) | (47,925) | 34,547,649 |
| 118,491,265 | 20,157,680 | (16,341,288) | (524,109) | 121,783,548 |
The increase of 'Provisions for other liabilities and charges' includes the amount of Euro 921,767 (2011: Euro 699,218) recorded in the profit and loss statement, under the caption 'Income taxation' (note 22). In 30 September 2011 it includes also the amount of Euro 97,120 related to the dismantling of sites, as foreseen in IAS 16 – Fixed Assets (note 1.d)).
The reinforcement on 'Accumulated Impairment losses on Inventories' is recorded, on the profit and loss statement under the caption 'Cost of Sales' (note 1.j)). Therefore, the total amount recorded in the profit and loss statement corresponding to the increase in the heading 'Provisions and impairment losses', corresponds to Euro 16,948,273 (2011: Euro 17,022,137).
The heading 'Utilisations' refers, essentially, to the utilisation of provisions registered against entries in customers current accounts of the subsidiary Optimus – Comunicações S.A., fully subject to impairment losses already recognised in the profit and loss statement.
The decreases are recorded in the profit and loss statement, under the caption 'Other operating revenues'.
At 30 September 2012 and 2011, the breakdown of the provisions for other liabilities and charges is as follows:
| 2012 | 2011 | |
|---|---|---|
| Dismantling of sites | 22,876,101 | 22,826,201 |
| Several contingencies | 4,286,476 | 3,040,274 |
| Legal processes in progress | 2,126,832 | 2,960,782 |
| Indemnities | 665,551 | 1,037,068 |
| Other responsibilities | 14,959,782 | 4,683,324 |
| 44,914,742 | 34,547,649 |
The heading 'Several contingencies' relates to contingent liabilities arising from transactions carried out in previous years and for which an outflow of funds is probable.
In relation to the provisions recorded for legal processes in progress and others, given the uncertainty of such proceedings, the Board of Directors is unable to estimate, with reliability, the moment when such provisions will be used and therefore no financial actualisation was carried out.
The heading 'Other responsibilities' corresponds to the value of costs charged to the current period or previous years, for which it is not possible to estimate reliably the time of occurrence of the expense (note 1.s), in the amount of circa Euro 12 million, which includes the amount of Euro 6.8 million related to the dispute concerning the vagueness of the interconnection tariffs of 2001.
On 30 December 2008, the subsidiary Optimus – Comunicação, S.A., carried out a securitisation operation of future receivables amounting to Euro 100 million (Euro 98,569,400, net of initial costs) following which it ceded future credits to be generated under a portfolio of existing 'Corporate' customer contracts, under the regime established in the Decreto-Lei nº 453/99 (Decree-Law), of 5 November (note 11).
This operation was coordinated by Deutsche Bank, the future credits having been assigned to TAGUS – Sociedade de Titularização de Créditos, S.A. (TAGUS), which, for this purpose, issued securitised bonds designated 'Magma No. 1 Securitisation Notes', that received from the CMVM (National Securities Market Commission) the legally required alphanumeric code: 200812TGSSONSXXN0031.
Future receivables in the necessary amounts required for TAGUS to perform the quarter interest and principal instalment payments due to bondholders, as well as all the other payments due to the other creditors of this transaction, shall be allocated by Optimus - Comunicação, S.A. throughout calendar years 2009/2013, up to a maximum of Euro 213,840,362. Under the terms of this transaction, the amount to be allocated in the next 12 months (Euro 19,915,612) was registered in current liabilities and the remainder, amounting to Euro 5,000,000, was registered in non-current liabilities.
The transaction did not determine any change in the accounting treatment of the underlying receivables or in the relationship established with the customers.
At 30 September 2012 and 2011, the amount recorded in 'Securitisation of receivables' has the following maturity:
| N+1 | N+2 | N+3 | N+4 | N+5 | Total | |
|---|---|---|---|---|---|---|
| 2012 | ||||||
| Securitisation of receivables | 19,915,612 | 5,000,000 | – | – | – | 24,915,612 |
| 2011 | ||||||
| Securitisation of receivables | 19,764,541 | 19,914,706 | 5,000,000 | – | – | 44,679,247 |
At 30 September 2012, this caption includes the amount of Euro 2,893,694 (2011: Euro 2,449,306) related to the short term portion of lease contracts (note 16).
'External supplies and services' for the periods ended at 30 September 2012 and 2011 had the following composition:
| 2012 | 2011 (restated) |
|
|---|---|---|
| Interconnection costs | 134,185,972 | 139,493,435 |
| Specialised works | 32,200,350 | 37,899,375 |
| Rents | 25,973,273 | 25,730,508 |
| Other subcontracts | 20,978,779 | 21,500,334 |
| Advertising and promotion | 16,552,789 | 21,467,208 |
| Commissions | 13,470,521 | 15,660,518 |
| Leased lines | 9,079,759 | 14,051,194 |
| Energy | 7,681,137 | 7,709,316 |
| Travelling costs | 4,008,524 | 3,759,565 |
| Fees | 3,937,016 | 2,729,080 |
| Maintenance and repairs | 3,833,245 | 4,377,274 |
| Communications | 3,505,633 | 4,335,860 |
| Others | 12,512,379 | 14,328,284 |
| 287,919,376 | 313,041,951 |
The commitments assumed by the Group at 30 September 2012 and 2011 related to operational leases are as follows:
| 2012 | 2011 | |
|---|---|---|
| Minimum payments of operational leases: | ||
| 2011 | – | 10,369,771 |
| 2012 | 9,038,194 | 43,441,454 |
| 2013 | 33,776,205 | 40,654,297 |
| 2014 | 29,423,034 | 38,118,811 |
| 2015 | 27,465,403 | 33,869,478 |
| 2016 | 23,576,423 | 31,598,248 |
| 2017 | 20,806,176 | 32,750,876 |
| 2018 onwards | 29,457,772 | – |
| Renewable by periods of one year | 4,424,160 | 2,749,115 |
| 177,967,367 | 233,552,050 |
During the period ended at 30 September 2012, an amount of Euro 32,155,878 (2011: Euro 34,775,388) was recorded in the heading 'External supplies and services' related with operational leasing rents, divided between the lines 'Rents' and 'Leased lines'.
The rents associated to the rental of facilities are mainly justified by the lease, established in 2007, of the Sonaecom building in Lisbon which has a five year period with the possibility of annual renewal. The actualisation of the rents will occur at the end of the first contract cycle (after the first five years).
Net financial results for the periods ended at 30 September 2012 and 2011 were made up as follows:
| 2012 | 2011 | |
|---|---|---|
| Financial expenses: | ||
| Interest expenses: | (11,831,801) | (10,510,754) |
| Bank loans | (9,018,211) | (6,930,361) |
| Securitisation interests | (1,350,524) | (2,239,069) |
| Leasing | (781,121) | (734,475) |
| Other interests | (681,945) | (606,849) |
| Foreign exchange losses | (1,285,673) | (1,260,620) |
| Other financial expenses | (1,209,045) | (552,827) |
| (14,326,518) | (12,324,201) | |
| Financial income: | ||
| Interest income | 4,334,084 | 4,603,886 |
| Foreign exchange gains | 666,123 | 888,199 |
| Others financial gains | 42,900 | 3,358 |
| 5,043,107 | 5,495,443 |
During the periods ended at 30 September 2012 and 2011, the caption 'Financial income: Interest income' includes, mainly, interests earned on treasury applications and interests arising from late collections associated with cases in litigation.
Income taxes recognised during the periods ended at 30 September 2012 and 2011 were made up as follows ((costs) / gains):
| 2012 | 2011 (restated) |
|
|---|---|---|
| Current tax | (1,751,324) | (1,473,334) |
| Tax provision net of reduction (note 17) | (921,767) | (699,218) |
| Deferred tax assets (note 11) | (7,559,988) | (4,152,306) |
| Deferred tax liabilities (note 11) | 3,131,854 | 102,349 |
| (7,101,225) | (6,222,509) |
During the periods ended at 30 September 2012 and 2011, the balances and transactions maintained with related parties were mainly associated with the normal operational activity of the Group (providing communications and consultancy services) and to the concession and obtainment of loans.
The most significant balances and transactions with related parties, which are listed in the appendix to this report, during the periods ended at 30 September 2012 and 2011 were as follows:
| Balances at 30 September 2012 | ||||||||
|---|---|---|---|---|---|---|---|---|
| Treasury | ||||||||
| applications | Other assets / | |||||||
| Accounts receivable | Accounts payable | (note 12) | (liabilities) | |||||
| Worten | 4,715,247 | 374,482 | – | (1,459,531) | ||||
| France Telecom | 3,113,696 | 2,533,403 | – | (3,476,930) | ||||
| Modelo Continente Hipermercados, S.A. | 938,870 | 621,221 | – | (301,130) | ||||
| Sierra Portugal | 763,286 | – | – | 81,939 | ||||
| Sonaecenter II | 725,162 | 111,975 | – | 3,391 | ||||
| SC-Sociedade de Consultadoria | 309,379 | 113 | – | (162,687) | ||||
| Sonae Indústria PCDM | 221,576 | – | – | 28,082 | ||||
| Raso Viagens | 84,933 | 90,250 | – | (147,735) | ||||
| Sonae SGPS | 44,874 | – | – | 3,036 | ||||
| Sonae Investments BV | - | – | 21,810,000 | 1,576 | ||||
| 10,917,023 | 3,731,444 | 21,810,000 | (5,429,989) |
| Balances at 30 September 2011 | ||||||||
|---|---|---|---|---|---|---|---|---|
| Treasury | ||||||||
| applications | Other assets / | |||||||
| Accounts receivable | Accounts payable | (note 12) | (liabilities) | |||||
| Worten | 2,630,312 | 268 | – | (231,529) | ||||
| France Telecom | 5,589,285 | 2,459,097 | – | (6,192,953) | ||||
| Modelo Continente Hipermercados, S.A. | 1,221,299 | 1,007,248 | – | (285,128) | ||||
| Sierra Portugal | 968,381 | – | – | 13,692 | ||||
| Sonaecenter II | 1,112,183 | 555,136 | – | 75,289 | ||||
| SC-Sociedade de Consultadoria | 198,175 | – | – | (50,850) | ||||
| Sonae Indústria PCDM | 402,511 | – | – | 27,463 | ||||
| Raso Viagens | 285,187 | 156,681 | – | (129,801) | ||||
| Sonae SGPS | 37,522 | 3,552 | – | (7,725) | ||||
| Sonae Investments BV | – | – | 41,810,000 | 4,061 | ||||
| 12,444,855 | 4,181,982 | 41,810,000 | (6,777,481) |
| Transactions at 30 September 2012 | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Sales and services | Supplies and | Interest and similar | Supplementary | ||||||
| rendered | services received | income / (expense) | income | ||||||
| Worten | 2,557,397 | 1,419,871 | – | 214 | |||||
| France Télécom | 11,285,777 | 11,951,899 | – | – | |||||
| Modelo Continente Hipermercados, S.A. | 3,449,586 | 1,261,292 | – | 292,116 | |||||
| Sierra Portugal | 5,056,215 | 469,505 | – | (49) | |||||
| Sonaecenter II | 7,681,374 | 527,881 | – | – | |||||
| SC-Sociedade de Consultadoria | 909,261 | 113 | – | – | |||||
| Sonae Indústria PCDM | 1,160,645 | (5,150) | – | – | |||||
| Raso Viagens | 371,619 | 1,425,294 | – | – | |||||
| Sonae SGPS | 11,766 | 4,500 | 274,803 | – | |||||
| Sonae Investments BV | – | – | 700,045 | – | |||||
| 32,483,640 | 17,055,205 | 974,848 | 292,281 |
| Transactions at 30 September 2011 | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Sales and services | Supplies and | Interest and similar | Supplementary | ||||||
| rendered | services received | income / (expense) | income | ||||||
| Worten | 2,853,388 | 1,809,457 | – | 3,810 | |||||
| France Télécom | 12,300,201 | 10,052,642 | – | – | |||||
| Modelo Continente Hipermercados, S.A. | 2,108,964 | 1,134,241 | – | 165,925 | |||||
| Sierra Portugal | 5,061,475 | 1,488,510 | – | 5,214 | |||||
| Sonaecenter II | 7,195,297 | 381,264 | – | – | |||||
| SC-Sociedade de Consultadoria | 458,427 | – | – | – | |||||
| Sonae Indústria PCDM | 1,163,751 | – | – | – | |||||
| Raso Viagens | 431,973 | 1,812,508 | – | – | |||||
| Sonae SGPS | 60,401 | 63,102 | (11,039) | – | |||||
| Sonae Investments BV | – | – | 1,251,014 | – | |||||
| 31,633,877 | 16,741,724 | 1,239,975 | 174,949 |
In the period ended at 30 September 2012, the Group signed an agreement with Sonae SGPS, under which Sonae compromise to transfer to employees and board members of Sonaecom, Sonaecom shares, at the price of 1.184 euros, as requested by Sonaecom and under the MTIP of Sonaecom. Under this contract, Sonaecom paid to Sonae SGPS, SA the amount of EUR 3,291,520, which was recorded under the caption "Other reserves" in equity.
The transactions between Group companies were eliminated in consolidation, and therefore are not disclosed in this note.
All the above transactions were made at market prices.
Accounts receivable and payable to related companies will be settled in cash and are not covered by guarantees. During the periods ended at 30 September 2012 and 2011, no impairment losses referring to related entities were recognised.
A complete list of the Sonaecom Group's related parties is presented in the appendix to this report.
Guarantees provided to third parties at 30 September 2012 and 2011 were as follows:
| Company | Beneficiary | Description | 2012 | 2011 |
|---|---|---|---|---|
| Optimus | ICP - ANACOM | Acquisition of Spectrum for 4th generation |
30,000,000 | – |
| Optimus and Sonaecom | Direção de Contribuições e Impostos (Portuguese tax authorities) |
VAT Reimbursements | 9,311,818 | 9,350,818 |
| WeDo | Espiríto Santo Bank | Bank loan | 5,902,939 | – |
| Optimus | Direção de Contribuições e Impostos (Portuguese tax authorities) |
IRC – Tax assessment | 4,039,639 | 4,039,639 |
| We Do, WeDo Egipto and WeDo Mexico |
Digi Telecommunications, Emirates Telecom. Corp., Etisalat, Pak Telecom, Scotiabank, Telcel and Telefonica Moviles Chile |
Completion of work to be done | 1,165,619 | 1,143,071 |
| Sonaecom | Direção de Contribuições e Impostos (Portuguese tax authorities) |
Tax audit 2005 | 754,368 | 754,368 |
| We Do, Saphety and Digitmarket | IAPMEI | 'HERMES' project - QREN | 417,797 | 436,822 |
| Optimus | Direção Geral do Tesouro (Portuguese tax authorities) |
IRC – Witholding tax on payments to non-residents |
306,954 | 306,954 |
| Optimus | Câmara Municipal de Barcelos, Chaves, Coimbra, Covilhã, Elvas, Lisboa, Loures, Mealhada, Oeiras and Sintra (Barcelos, Chaves, Coimbra, Covilhã, Elvas, Lisboa, Loures, Mealhada, Oeiras and Sintra Municipalities) |
Completion of work to be done | 124,329 | 246,270 |
| Optimus and Público | Direção de Contribuições e Impostos (Portuguese tax authorities) |
VAT – Impugnation process | 18,000 | 598,000 |
| Público | Tribunal de Trabalho de Lisboa (Lisbon Labour Court) |
Execution action n. 199A/92 | – | 271,511 |
| Optimus | Governo Civil de Lisboa (Lisbon Government Civil) |
Guarantee the sweepstakes plan complete fulfilment |
– | 104,650 |
| Several | Others | 1,063,336 | 1,169,538 | |
| 53,104,799 | 18,421,641 |
In addition to these guarantees were set up two sureties for the current fiscal processes. The Sonae SGPS consisted of Sonaecom SGPS surety to the amount of Euro 2,844,270 and Sonaecom SGPS consisted of Optimus surety for the amount of Euro 9,264,267.
At 30 September 2012, the Board of Directors of the Group believes that the decision of the court proceedings and ongoing tax assessments in progress will not have significant impacts on the consolidated financial statements.
The following business segments were identified for the periods ended at 30 September 2012 and 2011:
The segment 'Holding activities' includes the operations of the Group companies that have as their main activity the management of shareholdings.
Excluding the ones mentioned above, the remaining activities of the Group have been classified as unallocated.
Inter-segment transactions during the periods ended at 30 September 2012 and 2011 were eliminated in the consolidation process. All these transactions were made at market prices.
Inter-segment transfers or transactions were entered under the normal commercial terms and conditions that would also be available to unrelated third parties and were mainly related to interest on treasury applications and management fees.
Overall information by business segment at 30 September 2012 and 2011, prepared in accordance with the same accounting policies and measurement criteria adopted in the preparation of the consolidated financial statements, can be summarised as follows:
| Telecommunications | Multimedia | Information Systems | Holding Activities | Other | Subtotal | Eliminations | Total | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| September 2012 |
September 2011 (restated) |
September 2012 |
September 2011 (restated) |
September 2012 |
September 2011 (restated) |
September 2012 |
September 2011 (restated) |
September 2012 |
September 2011 (restated) |
September 2012 |
September 2011 (restated) |
September 2012 | September 2011 (restated) |
September 2012 |
September 2011 (restated) |
|
| Revenues: | ||||||||||||||||
| Sales and services rendered | 538,332,733 | 566,125,425 | 15,642,446 19,263,300 | 76,969,796 83,292,197 | 2,885,329 | 2,956,622 | - | 165,600 | 633,830,304 | 671,803,144 | (16,855,235) | (21,494,321) | 616,975,069 650,308,823 | |||
| Other operating revenues | 8,617,056 | 8,614,047 | 256,861 | 420,669 | 834,132 | 453,472 | 31,203 | 896 | - | - | 9,739,252 | 9,489,084 | (2,964,914) | (3,194,728) | 6,774,338 | 6,294,356 |
| Total revenues | 546,949,789 574,739,472 | 15,899,307 19,683,969 | 77,803,928 83,745,669 | 2,916,532 | 2,957,518 | - | 165,600 | 643,569,556 | 681,292,228 | (19,820,149) (24,689,049) | 623,749,407 656,603,179 | |||||
| Depreciation and amortisation Net operating income / (loss) for the segment |
(102,574,903) (106,373,923) 85,220,710 |
(896,547) 72,405,304 (4,046,403) (3,314,014) |
(915,029) | (3,717,594) (3,775,159) | 3,501,329 1,246,659 | (51,176) (441,026) |
(56,882) (789,724) |
- - |
(23,209) 59,864 |
(107,240,220) 84,234,610 |
(111,144,202) 69,608,089 |
(3,517,026) (3,938,945) |
706,733 239,528 |
(110,757,246) (110,437,469) 80,295,665 |
69,847,617 | |
| Net interests Other financial results |
(3,829,127) (911,634) |
(9,377,058) (126,127) |
(259,682) 7,183 |
(181,954) (3,806) |
(594,050) | (659,127) (574,952) (566,074) |
(1,977,002) 71,363,344 |
4,821,383 1,960,580 |
- - |
(44,796) (40) |
(6,659,861) 69,883,941 |
(5,441,552) 1,264,533 |
(837,856) (71,669,635) |
(465,316) (2,186,423) |
(1,785,694) | (7,497,717) (5,906,868) (921,890) |
| Consolidated EBT for the period |
80,479,948 | 62,902,120 (4,298,902) (3,499,774) | 2,332,328 | 21,458 | 68,945,317 | 5,992,239 | - | 15,029 | 147,458,691 | 65,431,072 | (76,446,437) | (2,412,213) | 71,012,254 | 63,018,859 | ||
| Assets: Tangible and intangible assets and goodwill |
966,983,534 849,829,659 | 3,782,937 3,866,873 | 75,598,796 68,599,332 | 312,516 | 380,165 | - | 15,715 | 1,046,677,783 | 922,691,744 | 446,060,483 457,387,434 | 1,492,738,266 1,380,079,178 | |||||
| Inventories | 13,464,209 | 13,183,086 | 569,877 | 604,585 | 248,586 | 440,204 | - | - | - | - | 14,282,672 | 14,227,875 | - | - | 14,282,672 | 14,227,875 |
| Financial investments | - | 1,282,025 | 209,829 | 441,509 | 2,494 | 2,494 1,058,499,704 1,134,606,802 | - | - | 1,058,712,027 1,136,332,830 | (1,058,499,704) (1,136,120,507) | 212,323 | 212,323 | ||||
| Other non-current assets Other current assets of the |
90,496,802 | 107,419,022 | 3,570 | 3,570 | 8,717,119 1,468,773 | 492,335,976 498,857,752 | - 1,547,298 | 591,553,467 | 609,296,415 | (494,554,676) (503,627,806) | 96,998,791 105,668,609 | |||||
| segment | 231,117,369 309,094,859 | 6,734,705 9,608,544 | 47,579,537 49,406,267 | 131,572,026 151,367,377 | - | 80,143 | 417,003,637 | 519,557,190 | (118,589,440) (92,359,334) | 298,414,197 427,197,856 | ||||||
| Liabilities: Liabilities of the segment |
794,493,539 | 737,252,149 | 19,285,577 20,632,596 | 79,744,613 67,236,101 | 394,633,176 515,667,278 | - | 1,478,804 | 1,288,156,905 1,342,266,928 | (455,529,666) (442,983,752) | 832,627,239 899,283,176 | ||||||
| CAPEX | 100,808,134 | 57,566,876 | 553,779 | 447,836 | 11,727,956 2,973,370 | 21,738,810 166,690,000 | - | 16,381 | 134,828,679 | 227,694,463 | (24,056,564) (145,545,375) | 110,772,115 | 82,149,088 |
Despite the merger that occurred in 2007 between the mobile and fixed telecommunications businesses, for some headings of the balance sheet and of the profit and loss statement, the Board of Directors of the Group decided to maintain a separate analysis of the business as follows:
| Mobile network | Fixed network and internet | Eliminations | Telecommunications | |||||
|---|---|---|---|---|---|---|---|---|
| September 2012 | September 2011 (restated) |
September 2012 | September 2011 (restated) |
September 2012 | September 2011 (restated) |
September 2012 | September 2011 (restated) |
|
| Income: | ||||||||
| Sales and services rendered | 399,556,558 | 430,159,200 | 161,650,988 | 163,492,450 | (22,874,813) | (27,526,225) | 538,332,733 | 566,125,425 |
| Other operating revenues | 21,364,721 | 24,168,246 | 774,205 | 671,363 | (13,521,870) | (16,225,562) | 8,617,056 | 8,614,047 |
| Total revenues | 420,921,279 | 454,327,446 | 162,425,193 | 164,163,813 | (36,396,683) | (43,751,787) | 546,949,789 | 574,739,472 |
| Depreciation and amortisation | (77,481,880) | (79,522,176) | (24,973,722) | (26,668,169) | (119,301) | (183,578) | (102,574,903) | (106,373,923) |
| Operational results of the segments | 99,263,387 | 89,201,162 | (13,905,316) | (16,622,783) | (137,361) | (173,074) | 85,220,710 | 72,405,305 |
| Assets: | ||||||||
| Tangible assets and goodwill | 836,699,166 | 700,890,252 | 130,284,368 | 148,939,407 | – | – | 966,983,534 | 849,829,659 |
| Inventories | 12,652,929 | 12,809,863 | 811,280 | 373,223 | – | – | 13,464,209 | 13,183,086 |
| Financial investments | – | 1,282,025 | – | – | – | – | 1,282,025 | |
| CAPEX | 84,144,532 | 63,895,644 | 15,548,325 | 15,488,753 | 1,115,277 | (21,817,521) | 100,808,134 | 57,566,876 |
During the periods ended at 30 September 2012 and 2011, the inter-segments sales and services were as follows:
| Telecommunications | Multimedia | Information Systems |
Holding Activities | Others | |
|---|---|---|---|---|---|
| 2012 | |||||
| Telecommunications | - | - | 12,128,763 | 2,480,336 | - |
| Multimedia | 803,390 | - | 92,119 | 128,677 | - |
| Information Systems | 1,038,928 | 15,162 | - | 266,399 | - |
| Holding Activities | 66,894 | 3,574 | 1,875 | - | - |
| Sonaecom others | - | - | - | - | - |
| External trade debtors | 536,423,521 | 15,623,710 | 64,747,039 | 9,917 | - |
| 538,332,733 | 15,642,446 | 76,969,796 | 2,885,329 | ||
| 2011 | |||||
| Telecommunications | - | - | 16,130,188 | 2,562,925 | 165,600 |
| Multimedia | 981,539 | - | 121,840 | 128,945 | - |
| Information Systems | 1,045,835 | 44,635 | - | 264,752 | - |
| Holding Activities | 42,319 | 3,191 | 1,494 | - | - |
| Sonaecom others | 1,056 | - | - | - | - |
| External trade debtors | 564,054,676 | 19,215,474 | 67,038,675 | - | - |
| 566,125,425 | 19,263,300 | 83,292,197 | 2,956,622 | 165,600 | |
Earnings per share, basic and diluted, are calculated by dividing the consolidated net income attributable to the Group (Euro 63,902,108 in 2012 and Euro 56,785,382 in 2011 restated) by the average number of shares outstanding during the periods ended at 30 September 2012 and 2011, net of own shares (359,146,641 in 2012 and 357,150,209 in 2011).
In June 2000, Sonaecom Group created a discretionary Medium Term Incentive Plan, for more senior employees, based on Sonaecom options and shares and Sonae S.G.P.S., S.A. shares. The vesting occurs three years after the award of each plan, assuming that the employees are still employed in the Group.
| 30 September 2012 | |||||
|---|---|---|---|---|---|
| Share price at award date* |
Award date | Vesting date | Aggregate number of |
Number of shares |
|
| Sonaecom shares | |||||
| 2008 Plan | 1.117 | 10-Mar-09 | 09-Mar-12 | - | - |
| 2009 Plan | 1.685 | 10-Mar-10 | 08-Mar-13 | 375 | 2,519,335 |
| 2010 Plan | 1.399 | 10-Mar-11 | 10-Mar-14 | 368 | 2,958,423 |
| 2011 Plan | 1.256 | 09-Mar-12 | 10-Mar-15 | 364 | 3,065,137 |
| Sonae SGPS shares | |||||
| 2008 Plan | 0.526 | 10-Mar-09 | 09-Mar-12 | - | - |
| 2009 Plan | 0.761 | 10-Mar-10 | 08-Mar-13 | 4 | 342,242 |
| 2010 Plan | 0.811 | 10-Mar-11 | 10-Mar-14 | 8 | 412,823 |
| 2011 Plan | 0.401 | 09-Mar-12 | 10-Mar-15 | 7 | 761,890 |
The Sonaecom plans outstanding at 30 September 2012 can be summarised as follows:
*Average share price in the month prior to the award date for Sonaecom shares and the lower of the average share price for the month prior to the Annual General Meeting and the share price on the day after the Annual General Meeting, for Sonae SGPS shares.
During the period ended at 30 September 2012, the movements that occurred in the plans can be summarised as follows:
| Sonaecom shares |
Sonae SGPS shares |
|||
|---|---|---|---|---|
| Aggregate number of |
participations Number of shares | Aggregate number of |
participations Number of shares | |
| Outstanding at 31 December 2011: | ||||
| Unvested | 1,155 | 8,892,470 | 16 | 1,100,633 |
| Total | 1,155 | 8,892,470 | 16 | 1,100,633 |
| Movements in the year: | ||||
| Awarded | 367 | 2,911,077 | 7 | 696,026 |
| Vested | (380) | (3,761,450) | (4) | (405,776) |
| Cancelled / elapsed/transfers (1) | (35) | 500,798 | - | 126,072 |
| Outstanding at 30 September 2012: | ||||
| Unvested | 1,107 | 8,542,895 | 19 | 1,516,955 |
| Total | 1,107 | 8,542,895 | 19 | 1,516,955 |
(1) The adjustments are made for dividends paid and for share capital changes and others adjustments, namely, resulting from a change in the vesting of the MTIP, which may now be made through the purchase of shares with discount.
For Sonaecom's share plans of 2009 and 2010, the responsibility is calculated taking into consideration the share price at award date of each plan. For 2011 Sonaecom shares plan, the Company signed with Sonae SGPS, SA a contract that agrees to the transfer of Sonaecom SGPS shares for employees and board members of the Group as requested of Sonaecom and under the MTIP of Sonaecom, and the liabilities are calculated based on the price fixed in the contract. The responsibility for the three share plans was recorded under the heading 'Medium Term Incentive Plans Reserve'. For the Sonae SGPS share plans, the Group entered into hedging contracts with external entities and the liabilities are calculated based on the prices agreed in those contracts. The responsibility of these plans is recorded under the headings of 'Other current liabilities' and 'Other non-current liabilities'.
Share plan costs are recognised in the accounts over the year between the award and the vesting date of those shares. The costs recognised in previous years and in the period ended at 30 September 2012, were as follows:
| Amount | |
|---|---|
| Costs recognised in previous years | 31,075,127 |
| Costs recognised in the period | 3,412,738 |
| Costs of plans vested in previous years | (23,313,389) |
| Costs of plans vested in the period | (4,451,699) |
| Total cost of the plans | 6,722,777 |
| Recorded in 'Other current liabilities' | 235,273 |
| Recorded in 'Other non-current liabilities' | 258,470 |
| Recorded in reserves | 6,229,034 |
At 30 September 2012, accounts receivable from customers and accounts payable to suppliers include Euro 37,139,253 and Euro 29,913,608, respectively, as well the captions 'Other current assets' and 'Provisions and accumulated impairment losses' include Euro 411,649 and Euro 6,817,553, respectively, resulting from a dispute between the subsidiary Optimus – Comunicação, S.A. and, essentially, the operator TMN – Telecomunicações Móveis Nacionais, S.A., in relation to the vagueness of interconnection tariffs, recorded in the year ended at 31 December 2001. The Group has considered the most penalising tariffs in their consolidated financial statements. In the lower court, the decision was favourable to Optimus. The 'Tribunal da Relação' (Court of Appeal), on appeal, rejected the intentions of TMN. However, TMN again appealed to the 'Supremo Tribunal de Justiça' (Supreme Court), for final and permanent decision, who upheld the decision of the 'Tribunal da Relação' (Court of Appeal), thus concluding that the interconnection prices for 2001 were not defined. The settlement of outstanding amounts will depend on the price that will be established.
Following a deliberation of Board of Directors of ICP - ANACOM, it was applied to the Sonaecom's subsidiary Optimus, a fine of approximately 6.5 million euros, due to an alleged failure in the application of the resolutions taken by the regulator's on 26 October 2005, concerning termination rates for fixed calls. The Boards of Directors of Optimus and Sonaecom understand that Optimus has always complied with that resolution. Given this, Optimus contested in court the application of that fine and is expecting that the appeal will be upheld.
At 10 October 2012, the Bord of Directors of Público announced, a restructuring project that will involve the fit and enhancement of skills, including a greater focus on the growing demand of the digital world and in reducing the cost structure, leading to a decrease in operating costs and the predictable leave of 48 employees. The restructuring project, which includes the cost of claims, amounts to circa 2.6 million.
These consolidated financial statements were approved by the Board of Directors on 29 October 2012.
These financial statements are a translation of financial statements originally issued in Portuguese in accordance with International Financial Reporting Standards (IAS / IFRS) as adopted by the European Union and the format and disclosures required by those Standards, some of which may not conform to or be required by generally accepted accounting principles in other countries. In the event of discrepancies, the Portuguese language version prevails.
| Ana Cristina Dinis da Silva Fanha Vicente Soares | Gervais Gilles Pellissier |
|---|---|
| Ana Paula Garrido Pina Marques | Jean-François René Pontal |
| Ângelo Gabriel Ribeirinho dos Santos Paupério | José Manuel Pinto Correia |
| António Bernardo Aranha da Gama Lobo Xavier | Manuel Antonio Neto Portugal Ramalho Eanes |
| António de Sampaio e Mello | Maria Cláudia Teixeira de Azevedo |
| David Charles Denholm Hobley | Miguel Nuno Santos Almeida |
| David Graham Shenton Bain | Nuno Manuel Moniz Trigoso Jordão |
| David Pedro Oliveira Parente Ferreira Alves | Paulo Joaquim dos Santos Plácido |
| Duarte Paulo Teixeira de Azevedo | Pedro Rafael de Sousa Nunes Pedro |
| Franck Emmanuel Dangeard | Rui José Silva Goncalves Paiva |
| Key management personnel - Sonae SGPS | ||||
|---|---|---|---|---|
| Álvaro Carmona e Costa Portela | Christine Cross | |||
| Álvaro Cuervo Garcia | José Manuel Neves Adelino | |||
| Belmiro de Azevedo | Michel Marie Bon | |||
| Bernd Hubert Joachim Bothe |
| Sonae/Efanor Group Companies | ||||
|---|---|---|---|---|
| 3DO Holding GmbH | Avenida M – 40, S.A. | |||
| 3DO Shopping Centre GmbH | Azulino Imobiliária, S.A. | |||
| 3shoppings – Holding,SGPS, S.A. | BA Business Angels, SGPS, SA | |||
| 8ª Avenida Centro Comercial, SA | BA Capital, SGPS, SA | |||
| ADD Avaliações Engenharia de Avaliações e Perícias Ltda | BB Food Service, S.A. | |||
| ADDmakler Administração e Corretagem de Seguros Ltda | Beralands BV | |||
| ADDmakler Administradora, Corretora de Seguros Partic. Ltda | Bertimóvel – Sociedade Imobiliária, S.A. | |||
| Adlands B.V. | BHW Beeskow Holzwerkstoffe | |||
| Aegean Park, S.A. | Bloco Q – Sociedade Imobiliária, S.A. | |||
| Agepan Eiweiler Management GmbH | Bloco W – Sociedade Imobiliária, S.A. | |||
| Agepan Flooring Products, S.A.RL | Boavista Shopping Centre BV | |||
| Agloma Investimentos, Sgps, S.A. | BOM MOMENTO – Comércio Retalhista, SA | |||
| Agloma-Soc.Ind.Madeiras e Aglom., S.A. | Canasta – Empreendimentos Imobiliários, S.A. | |||
| Águas Furtadas Sociedade Agrícola, SA | Carnes do Continente – Ind.Distr.Carnes, S.A. | |||
| Airone – Shopping Center, Srl | Casa Agrícola de Ambrães, S.A. | |||
| ALBCC Albufeirashopping C.Comercial SA | Casa da Ribeira – Hotelaria e Turismo, S.A. | |||
| ALEXA Administration GmbH | Cascaishopping – Centro Comercial, S.A. | |||
| ALEXA Asset GmbH & Co KG | Cascaishopping Holding I, SGPS, S.A. | |||
| ALEXA Holding GmbH | CCCB Caldas da Rainha - Centro Comercial,SA | |||
| ALEXA Shopping Centre GmbH | Centro Colombo – Centro Comercial, S.A. | |||
| Algarveshopping – Centro Comercial, S.A. | Centro Residencial da Maia,Urban., S.A. | |||
| Alpêssego – Soc. Agrícola, S.A | Centro Vasco da Gama – Centro Comercial, S.A. | |||
| Andar – Sociedade Imobiliária, S.A. | Change, SGPS, S.A. | |||
| Aqualuz – Turismo e Lazer, Lda | Chão Verde – Soc.Gestora Imobiliária, S.A. | |||
| Arat inmebles, S.A. | Cinclus Imobiliária, S.A. | |||
| ARP Alverca Retail Park,SA | Citorres – Sociedade Imobiliária, S.A. | |||
| Arrábidashopping – Centro Comercial, S.A. | Coimbrashopping – Centro Comercial, S.A. | |||
| Aserraderos de Cuellar, S.A. | Colombo Towers Holding, BV | |||
| Atlantic Ferries – Tráf.Loc,Flu.e Marít, S.A. | Contacto Concessões, SGPS, S.A. | |||
| Avenida M – 40 B.V. | Contibomba – Comérc.Distr.Combustiveis, S.A. |
| Contimobe – Imobil.Castelo Paiva, S.A. | Glunz UK Holdings Ltd |
|---|---|
| Continente Hipermercados, S.A. | Glunz Uka Gmbh |
| Contry Club da Maia-Imobiliaria, S.A. | GMET, ACE |
| Cooper Gay Swett & Crawford Lt | Golf Time – Golfe e Invest. Turísticos, S.A. |
| Craiova Mall BV | Guimarãeshopping – Centro Comercial, S.A. |
| Cronosaúde – Gestão Hospitalar, S.A. | Harvey Dos Iberica, S.L. |
| Cumulativa – Sociedade Imobiliária, S.A. | Herco Consultoria de Riscos e Corretora de Seguros Ltda |
| Darbo S.A.S | HighDome PCC Limited |
| Deutsche Industrieholz GmbH | Iberian Assets, S.A. |
| Discovery Sports, SA | Igimo – Sociedade Imobiliária, S.A. |
| Dortmund Tower GmbH | Iginha – Sociedade Imobiliária, S.A. |
| Dos Mares – Shopping Centre B.V. | Imoareia – Invest. Turísticos, SGPS, S.A. |
| Dos Mares – Shopping Centre, S.A. | Imobiliária da Cacela, S.A. |
| Ecociclo – Energia e Ambiente, S.A. | Imoclub – Serviços Imobilários, S.A. |
| Ecociclo II | Imoconti – Soc.Imobiliária, S.A. |
| Edições Book.it, S.A. | Imodivor – Sociedade Imobiliária, S.A. |
| Edificios Saudáveis Consultores, S.A. | Imoestrutura – Soc.Imobiliária, S.A. |
| Efanor Investimentos, SGPS, S.A. | Imoferro – Soc.Imobiliária, S.A. |
| Efanor Serviços de Apoio à Gestão, S.A. | Imohotel – Emp.Turist.Imobiliários, S.A. |
| El Rosal Shopping, S.A. | Imomuro – Sociedade Imobiliária, S.A. |
| Emfísico Boavista | Imopenínsula – Sociedade Imobiliária, S.A. |
| Empreend.Imob.Quinta da Azenha, S.A. | Imoplamac Gestão de Imóveis, S.A. |
| Equador & Mendes, Lda | Imoponte – Soc.Imobiliaria, S.A. |
| Espimaia – Sociedade Imobiliária, S.A. | Imoresort – Sociedade Imobiliária, S.A. |
| Estação Viana – Centro Comercial, S.A. | Imoresultado – Soc.Imobiliaria, S.A. |
| Estêvão Neves – Hipermercados Madeira, S.A. | Imosedas – Imobiliária e Seviços, S.A. |
| Euroresinas – Indústrias Quimicas, S.A. | Imosistema – Sociedade Imobiliária, S.A. |
| Farmácia Selecção, S.A. | Imosonae II |
| Fashion Division Canárias, SL | Impaper Europe GmbH & Co. KG |
| Fashion Division, S.A. | Implantação – Imobiliária, S.A. |
| Fozimo – Sociedade Imobiliária, S.A. | Infofield – Informática, S.A. |
| Fozmassimo – Sociedade Imobiliária, S.A. | Infratroia, EM |
| Freccia Rossa – Shopping Centre S.r.l. | Inparsa – Gestão Galeria Comercial, S.A. |
| Frieengineering International Ltda | Inparvi SGPS, S.A. |
| Fundo de Invest. Imobiliário Imosede | Integrum - Energia, SA |
| Fundo I.I. Parque Dom Pedro Shop.Center | Integrum Colombo Energia, S.A. |
| Fundo Invest.Imob.Shopp. Parque D.Pedro | Interlog – SGPS, S.A. |
| Gaiashopping I – Centro Comercial, S.A. | Invesaude - Gestão Hospitalar S.A. |
| Gaiashopping II – Centro Comercial, S.A. | Investalentejo, SGPS, S.A. |
| GHP Gmbh | Ioannina Development of Shopping Centres, SA |
| Gli Orsi Shopping Centre 1 Srl | Isoroy SAS |
| Glunz AG | La Farga – Shopping Center, SL |
Cumulativa – Sociedade Imobiliária, S.A. Herco Consultoria de Riscos e Corretora de Seguros Ltda Glunz Service GmbH Laminate Park GmbH Co. KG
Larim Corretora de Resseguros Ltda Norteshopping – Centro Comercial, S.A. Larissa Develop. Of Shopping Centers, S.A. Norteshopping Retail and Leisure Centre, BV Lazam – MDS Corretora e Administradora de Seguros, S.A. Nova Equador Internacional,Ag.Viag.T, Ld LCC LeiriaShopping Centro Comercial SA Nova Equador P.C.O. e Eventos Libra Serviços, Lda. OSB Deustchland Gmbh Lidergraf – Artes Gráficas, Lda. PantheonPlaza BV Loop5 Shopping Centre GmbH Paracentro – Gest.de Galerias Com., S.A. Loureshopping – Centro Comercial, S.A. Pareuro, BV Luz del Tajo – Centro Comercial S.A. Park Avenue Develop. of Shop. Centers S.A. Luz del Tajo B.V. Parque Atlântico Shopping – C.C., S.A. Madeirashopping – Centro Comercial, S.A. Parque D. Pedro 1 B.V. Maiashopping – Centro Comercial, S.A. Parque D. Pedro 2 B.V. Maiequipa – Gestão Florestal, S.A. Parque de Famalicão – Empr. Imob., S.A. Marcas do Mundo – Viag. e Turismo Unip, Lda Parque Principado SL Marcas MC, ZRT Pátio Boavista Shopping Ltda. Marina de Tróia S.A. Pátio Campinas Shopping Ltda Marinamagic – Expl.Cent.Lúdicos Marít, Lda Pátio Goiânia Shopping Ltda Marmagno – Expl.Hoteleira Imob., S.A. Pátio Londrina Empreend. e Particip. Ltda Martimope – Sociedade Imobiliária, S.A. Pátio Penha Shopping Ltda. Marvero – Expl.Hoteleira Imob., S.A. Pátio São Bernardo Shopping Ltda MDS Affinity - Sociedade de Mediação, Lda Pátio Sertório Shopping Ltda MDS Assoc. Corretora de Seguros Ltda Pátio Uberlândia Shopping Ltda MDS Consultores, S.A. Peixes do Continente – Ind.Dist.Peixes, S.A. MDS Corretor de Seguros, S.A. Pharmaconcept – Actividades em Saúde, S.A. MDS Malta Holding Limited PHARMACONTINENTE – Saúde e Higiene, S.A. MDS SGPS, SA PJP – Equipamento de Refrigeração, Lda MDSAUTO - Mediação de Seguros, SA Plaza Éboli B.V. Megantic BV Plaza Éboli – Centro Comercial S.A. Miral Administração e Corretagem de Seguros Ltda Plaza Mayor Holding, SGPS, SA MJLF – Empreendimentos Imobiliários, S.A. Plaza Mayor Parque de Ócio BV Mlearning - Mds Knowledge Centre, Unip, Lda Plaza Mayor Parque de Ocio, SA Modalfa – Comércio e Serviços, S.A. Plaza Mayor Shopping BV MODALLOOP – Vestuário e Calçado, S.A. Plaza Mayor Shopping, SA Modelo – Dist.de Mat. de Construção, S.A. Ploi Mall BV Modelo Continente Hipermercados, S.A. Plysorol, BV Modelo Continente Intenational Trade, SA Poliface North America Modelo Hiper Imobiliária, S.A. POLINSUR – Mediação de seguros, LDA Modelo.com – Vendas p/Correspond., S.A. PORTCC - Portimãoshopping Centro Comercial, SA Modus Faciendi - Gestão e Serviços, S.A. Porturbe – Edificios e Urbanizações, S.A. Movelpartes – Comp.para Ind.Mobiliária, S.A. Praedium – Serviços, S.A. Movimento Viagens – Viag. e Turismo U.Lda Praedium II – Imobiliária, S.A. Mundo Vip – Operadores Turisticos, S.A. Praedium SGPS, S.A. Munster Arkaden, BV Predicomercial – Promoção Imobiliária, S.A. Norscut – Concessionária de Scut Interior Norte, S.A. Prédios Privados Imobiliária, S.A.
Le Terrazze - Shopping Centre 1 Srl Operscut – Operação e Manutenção de Auto-estradas, S.A.
Predisedas – Predial das Sedas, S.A. Rochester Real Estate, Limited Pridelease Investments, Ltd RSI Corretora de Seguros Ltda Proj. Sierra Germany 4 (four) – Sh.C.GmbH S.C. Microcom Doi Srl Proj.Sierra Germany 2 (two) – Sh.C.GmbH Saúde Atlântica – Gestão Hospitalar, S.A. Proj.Sierra Germany 3 (three) – Sh.C.GmbH SC – Consultadoria, S.A. Proj.Sierra Italy 1 – Shop.Centre Srl SC – Eng. e promoção imobiliária,SGPS, S.A. Proj.Sierra Italy 2 – Dev. Of Sh.C.Srl SC Aegean B.V. Proj.Sierra Italy 3 – Shop. Centre Srl SC Assets SGPS, S.A. Proj.Sierra Italy 5 – Dev. Of Sh.C.Srl SC Finance BV Proj.Sierra Portugal VIII – C.Comerc., S.A. SC Mediterraneum Cosmos B.V. Project 4, Srl SC, SGPS, SA Project SC 1 BV SCS Beheer, BV Project SC 2 BV Selfrio,SGPS, S.A. Project Sierra 2 B.V. Selifa – Empreendimentos Imobiliários, S.A. Project Sierra 6 BV Sempre à Mão – Sociedade Imobiliária, S.A. Project Sierra 8 BV SERENITAS-SOC.MEDIAÇÃO SEG.LDA Project Sierra 9 BV Serra Shopping – Centro Comercial, S.A. Project Sierra Brazil 1 B.V. Sesagest – Proj.Gestão Imobiliária, S.A. Project Sierra Charagionis 1 S.A. Sete e Meio – Invest. Consultadoria, S.A. Project Sierra Four, SA Sete e Meio Herdades – Inv. Agr. e Tur., S.A. Project Sierra Germany Shop. Center 1 BV Shopping Centre Parque Principado B.V. Project Sierra Germany Shop. Center 2 BV Shopping Penha B.V. Project Sierra Spain 1 B.V. Siaf – Soc.Iniciat.Aprov.Florestais - Energia, S.A. Project Sierra Spain 2 – Centro Comer. S.A. SIAL Participações Ltda Project Sierra Spain 2 B.V. Sierra Asset Management – Gest. Activos, S.A. Project Sierra Spain 3 – Centro Comer. S.A. Sierra Berlin Holding BV Project Sierra Spain 3 B.V. Sierra Central S.A.S Project Sierra Spain 6 B.V. Sierra Charagionis Develop.Sh. Centre S.A. Project Sierra Spain 7 – Centro Comer. S.A. Sierra Charagionis Propert.Management S.A. Project Sierra Spain 7 B.V. Sierra Corporate Services Holland, BV Project Sierra Three Srl Sierra Development Greece, S.A. Project Sierra Two Srl Sierra Developments Germany GmbH Promessa Sociedade Imobiliária, S.A. Sierra Developments Holding B.V. Prosa – Produtos e serviços agrícolas, S.A. Sierra Developments Italy S.r.l. Puravida – Viagens e Turismo, S.A. Sierra Developments Romania, Srl Quorum Corretora de seguros LT Sierra Developments Spain – Prom.C.Com.SL Racionaliz. y Manufact.Florestales, S.A. Sierra Developments, SGPS, S.A. RASO - Viagens e Turismo, S.A. Sierra Enplanta Ltda RASO, SGPS, S.A. Sierra European R.R.E. Assets Hold. B.V. Rio Sul – Centro Comercial, S.A. Sierra GP Limited River Plaza Mall, Srl Sierra Investimentos Brasil Ltda River Plaza, BV Sierra Investments (Holland) 1 B.V.
Project Sierra 7 BV Sempre a Postos – Produtos Alimentares e Utilidades, Lda
Sierra Investments (Holland) 2 B.V. Sonae SGPS, S.A. Sierra Investments Holding B.V. Sonae Sierra Brasil S.A. Sierra Investments SGPS, S.A. Sonae Sierra Brazil B.V. Sierra Italy Holding B.V. Sonae Sierra, SGPS, S.A. Sierra Management Germany GmbH Sonae Tafibra Benelux, BV Sierra Management Greece S.A. Sonae Turismo – SGPS, S.A. Sierra Management Italy S.r.l. Sonae UK, Ltd. Sierra Management Romania, Srl Sonaegest – Soc.Gest.Fundos Investimentos Sierra Management Spain – Gestión C.Com.S.A. SONAEMC - Modelo Continente, SGPS, S.A. Sierra Management, SGPS, S.A. Sondis Imobiliária, S.A. Sierra Portugal, S.A. Sontel BV SII – Soberana Invest. Imobiliários, S.A. Sontur BV SIRS – Sociedade Independente de Radiodifusão Sonora, S.A. Sonvecap BV SISTAVAC, S.A. Sopair, S.A. SKK – Central de Distr., S.A. Sotáqua – Soc. de Empreendimentos Turist SKK SRL Spanboard Products, Ltd SKKFOR – Ser. For. e Desen. de Recursos SPF – Sierra Portugal Real Estate, Sarl Sociedade de Construções do Chile, S.A. Spinarq - Engenharia, Energia e Ambiente, SA Société de Tranchage Isoroy S.A.S. Spinveste – Gestão Imobiliária SGII, S.A. Socijofra – Sociedade Imobiliária, S.A. Spinveste – Promoção Imobiliária, S.A. Sociloures – Soc.Imobiliária, S.A. Sport Retalho España – Servicios Gen., S.A. Soconstrução BV Sport Zone – Comércio Art.Desporto, S.A. Sodesa, S.A. Sport Zone – Turquia Soflorin, BV Sport Zone Canárias, SL Soira – Soc.Imobiliária de Ramalde, S.A. Sport Zone España-Com.Art.de Deporte,SA Solinca - Eventos e Catering, SA Spred, SGPS, SA Solinca - Health and Fitness, SA Stinnes Holz GmbH Solinca – Investimentos Turísticos, S.A. Tableros Tradema, S.L. Solinfitness – Club Malaga, S.L. Tafiber,Tableros de Fibras Ibéricas, SL Solingen Shopping Center GmbH Tafibra Polska Sp.z.o.o. Soltroia – Imob.de Urb.Turismo de Tróia, S.A. Tafibra South Africa Somit Imobiliária Tafibra Suisse, SA SONAE - Specialized Retail, SGPS, SA Tafisa – Tableros de Fibras, S.A. Sonae Capital Brasil, Lda Tafisa Canadá Societé en Commandite Sonae Capital,SGPS, S.A. Tafisa France, S.A. Sonae Center II S.A. Tafisa UK, Ltd Sonae Center Serviços, S.A. Taiber,Tableros Aglomerados Ibéricos, SL Sonae Ind., Prod. e Com.Deriv.Madeira, S.A. Tarkett Agepan Laminate Flooring SCS Sonae Indústria – SGPS, S.A. Tecmasa Reciclados de Andalucia, SL Sonae Industria de Revestimentos, S.A. Terra Nossa Corretora de Seguros Ltda Sonae Indústria Manag. Serv, SA Têxtil do Marco, S.A. Sonae Investimentos, SGPS, SA Tlantic Portugal – Sist. de Informação, S.A. Sonae Novobord (PTY) Ltd Tlantic Sistemas de Informação Ltdª
Sonae Retalho Espana – Servicios Gen., S.A. Tool Gmbh
Sonae RE, S.A. Todos os Dias – Com.Ret.Expl.C.Comer., S.A.
| Torre Ocidente Imobiliária, S.A. | Vistas do Freixo, SA |
|---|---|
| Torre São Gabriel – Imobiliária, S.A. | Vuelta Omega, S.L. |
| TP – Sociedade Térmica, S.A. | Weiterstadt Shopping BV |
| Troia Market, S.A. | World Trade Center Porto, S.A. |
| Tróia Natura, S.A. | Worten – Equipamento para o Lar, S.A. |
| Troiaresort – Investimentos Turísticos, S.A. | Worten Canárias, SL |
| Troiaverde – Expl.Hoteleira Imob., S.A. | Worten España, S.A. |
| Tulipamar – Expl.Hoteleira Imob., S.A. | ZIPPY - Comércio e Distribuição, SA |
| Unishopping Administradora Ltda. | ZIPPY - Comercio y Distribución, S.A. |
| Unishopping Consultoria Imob. Ltda. | Zippy Turquia |
| Urbisedas – Imobiliária das Sedas, S.A. | Zubiarte Inversiones Inmobiliarias, S.A. |
| Valecenter Srl | ZYEVOLUTION-Invest.Desenv.,SA. |
| Valor N, S.A. | |
| Vastgoed One – Sociedade Imobiliária, S.A. | |
| Vastgoed Sun – Sociedade Imobiliária, S.A. | |
| Via Catarina – Centro Comercial, S.A. | |
| Viajens y Turismo de Geotur España, S.L. |
| FT Group Companies | |||
|---|---|---|---|
| France Telecom, S.A. | Atlas Services Belgium, S.A. |
For the periods ended at 30 September 2012 and 2011 and for the year ended at 31 December 2011
| Notes | September 2012 | September 2011 | December 2011 | |
|---|---|---|---|---|
| Assets | ||||
| Non-current assets | ||||
| Tangible assets | 1a and 2 | 311,352 | 376,325 | 361,047 |
| Intangible assets | 1b and 3 | 1,164 | 3,840 | 2,285 |
| Investments in Group companies | 1c and 5 | 1,083,177,804 | 1,100,697,029 | 1,097,478,929 |
| Other non-current assets | 1c, 1m, 4 and 6 | 499,364,206 | 557,281,652 | 542,879,752 |
| Total non-current assets | 1,582,854,526 | 1,658,358,846 | 1,640,722,013 | |
| Current assets | ||||
| Other current debtors | 1d, 1f, 4 and 8 | 26,923,079 | 14,851,907 | 5,250,772 |
| Other current assets | 1m | 979,928 | 1,984,115 | 1,249,804 |
| Cash and cash equivalents | 1g, 4 and 9 | 103,323,630 | 100,237,085 | 61,289,703 |
| Total current assets | 131,226,637 | 117,073,107 | 67,790,279 | |
| Total assets | 1,714,081,163 | 1,775,431,953 | 1,708,512,292 | |
| Shareholders' funds and liabilities | ||||
| Shareholders' funds | ||||
| Share capital | 10 | 366,246,868 | 366,246,868 | 366,246,868 |
| Own shares | 1p and 11 | (10,381,899) | (13,594,518) | (13,594,518) |
| Reserves | 1o | 869,618,634 | 904,008,211 | 904,095,590 |
| Net income / (loss) for the period | 91,118,652 | 598,457 | (7,960,682) | |
| Total Shareholders' funds | 1,316,602,255 | 1,257,259,018 | 1,248,787,258 | |
| Liabilities | ||||
| Non-current liabilities | ||||
| Medium and long-term loans – net of short-term portion | 1h, 4 and 12a | 188,796,920 | 318,344,375 | 319,485,865 |
| Provisions for other liabilities and charges | 1k, 1n and 13 | 70,934 | 68,654 | 68,654 |
| Other non-current liabilities | 1m and 1s | 104,833 | 236,392 | 271,207 |
| Total non-current liabilities | 188,972,687 | 318,649,421 | 319,825,726 | |
| Current liabilities | ||||
| Short-term loans and other loans | 1h, 4 and 12b | 207,163,568 | 193,588,701 | 137,109,904 |
| Other creditors | 4 and 14 | 434,728 | 5,086,758 | 1,579,811 |
| Other current liabilities | 1m and 1s | 907,925 | 848,055 | 1,209,593 |
| Total current liabilities | 208,506,221 | 199,523,514 | 139,899,308 | |
| Total Shareholders' funds and liabilities | 1,714,081,163 | 1,775,431,953 | 1,708,512,292 |
The notes are an integral part of the financial statements at 30 September 2012 and 2011.
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
For the periods and quarters ended at 30 September 2012 and 2011 and for the year ended at 31 December 2011
| Notes | September 2012 (not audited) |
July to September 2012 (not audited) |
September 2011 (not audited) |
July to September 2011 (not audited) |
December 2011 |
|
|---|---|---|---|---|---|---|
| Services rendered | 18 | 2,885,329 | 958,471 | 2,956,622 | 963,963 | 3,879,652 |
| Other operating revenues | 1f and 18 | 319 | 319 | 896 | (87,253) | 896 |
| 2,885,648 | 958,790 | 2,957,518 | 876,710 | 3,880,548 | ||
| External supplies and services | 1e, 15 and 18 | (1,431,164) | (433,638) | (1,555,720) | (422,782) | (1,986,852) |
| Staff expenses | 1s and 21 | (1,745,209) | (548,424) | (1,975,551) | (608,855) | (2,655,517) |
| Depreciation and amortisation | 1a, 1b, 2 and 3 | (51,176) | (16,931) | (56,882) | (18,622) | (75,411) |
| Provisions and impairment losses | 1k and 13 | (15,387) | – | – | – | – |
| Other operating costs | (35,434) | (3,185) | (77,087) | (39,531) | (100,022) | |
| (3,278,370) | (1,002,178) | (3,665,240) | (1,089,790) | (4,817,802) | ||
| Gains and losses on Group companies | 16 | 93,118,128 | 17,847,416 | (3,236,000) | – | (9,880,000) |
| Other financial expenses | 1c, 1h, 1i, 1q, 12, 16 and 18 | (10,659,222) | (3,467,992) | (7,979,214) | (2,928,544) | (12,043,254) |
| Other financial income | 9, 16 and 18 | 8,418,890 | 1,275,197 | 14,537,015 | 4,210,739 | 15,312,037 |
| Current income / (loss) | 90,485,074 | 15,611,233 | 2,614,079 | 1,069,115 | (7,548,471) | |
| Income taxation | 1l, 7 and 17 | 633,578 | 609,777 | (2,015,622) | (145,864) | (412,211) |
| Net income / (loss) for the period | 91,118,652 | 16,221,010 | 598,457 | 923,251 | (7,960,682) | |
| Earnings per share | 20 | |||||
| Including discontinued operations: | ||||||
| Basic | 0.19 | (0.01) | 0.00 | 0.00 | (0.02) | |
| Diluted | 0.19 | (0.01) | 0.00 | 0.00 | (0.02) | |
| Excluding discontinued operations: | ||||||
| Basic | 0.19 | (0.01) | 0.00 | 0.00 | (0.02) | |
| Diluted | 0.19 | (0.01) | 0.00 | 0.00 | (0.02) |
The notes are an integral part of the financial statements at 30 September 2012 and 2011.
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
For the periods and quarters ended at 30 September 2012 and 2011
| Notes | September 2012 (not audited) |
July to September 2012 (not audited) |
September 2011 (not audited) |
July to September 2011 (not audited) |
|
|---|---|---|---|---|---|
| Net income / (loss) for the period | 91,118,652 | 16,221,010 | 598,457 | 923,251 | |
| Components of other comprehensive income, net of tax | - | - | - | - | |
| Statement comprehensive income for the period | 91,118,652 | 16,221,010 | 598,457 | 923,251 |
The notes are an integral part of the financial statements at 30 September 2012 and 2011.
For the periods ended at 30 September 2012 and 2011
| Reserves | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Share capital | Own shares (note 11) |
Share premium |
Legal reserves |
Own shares reserves |
Medium Term Incentive Plans reserves (note 21) |
Other reserves |
Total reserves |
Net income / (loss) |
Total | |
| 2012 Balance at 31 December 2011 Appropriation of result of 2011 |
366,246,868 | (13,594,518) | 775,290,377 | 7,991,192 | 13,594,518 | 742,525 | 106,476,978 | 904,095,590 | (7,960,682) | 1,248,787,258 |
| Transfer to legal reserves and other reserves Dividends distribution Comprehensive income for the period ended at 30 |
- - |
- - |
- - |
- - |
- - |
- - |
(7,960,682) (25,172,240) |
(7,960,682) (25,172,240) |
7,960,682 | - (25,172,240) |
| September 2012 Delivery of own shares under the Short and Medium |
- | - | - | - | - | - | - | - | 91,118,652 | 91,118,652 |
| Term Incentive Plans Sale of own shares to subsidiaries under the Medium Term Incentive Plans |
- - |
438,791 4,949,143 |
- - |
- - |
(438,791) (4,949,143) |
(443,650) - |
443,650 4,008,619 |
(438,791) (940,524) |
- - |
- 4,008,619 |
| Delivery of own shares under the loan in shares to subsidiaries Reimbursement of own shares under the loan in shares |
- | 1,962,514 | - | - | (1,962,514) | - | 1,962,514 | - | - | 1,962,514 |
| to subsidiaries Effect of the recognition of the Medium Term Incentive |
- | (1,962,514) | - | - | 1,962,514 | - | (1,962,514) | - | - | (1,962,514) |
| Plans | - | - | - | - | - | 311,781 | 311,781 | - | 311,781 | |
| Derivate on own shares (notes 18 and 21) | - | - | - | - | - | (276,500) | (276,500) | - | (276,500) | |
| Acquisition of own shares | - | (2,175,315) | - | - | 2,175,315 | - | (2,175,315) | - | - | (2,175,315) |
| Balance at 30 September 2012 | 366,246,868 | (10,381,899) | 775,290,377 | 7,991,192 | 10,381,899 | 610,656 | 75,344,510 | 869,618,634 | 91,118,652 | 1,316,602,255 |
| Reserves | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Share capital | Own shares (note 11) |
Share premium |
Legal reserves |
Own shares reserves |
Medium Term Incentive Plans reserves (note 21) |
Other reserves |
Total reserves |
Net income / (loss) |
Total | |
| 2011 | ||||||||||
| Balance at 31 December 2010 Appropriation of result of 2010 |
366,246,868 | (15,030,834) | 775,290,377 | 1,221,003 | 15,030,834 | 551,381 | (3,849,290) | 788,244,305 | 135,403,787 | 1,274,864,126 |
| Transfer to legal reserves and other reserves | - | - | - | 6,770,189 | - | - | 128,633,598 | 135,403,787 | (135,403,787) | - |
| Dividends distribution | - | - | - | - | - | - | (17,859,403) | (17,859,403) | - | (17,859,403) |
| Comprehensive income for the period ended at 30 September 2011 Delivery of own shares under the Medium Term |
- | - | - | - | - | - | - | - | 598,457 | 598,457 |
| Incentive Plans | - | 3,659,603 | - | - | (3,659,603) | (186,538) | 1,775,360 | (2,070,781) | - | 1,588,822 |
| Effect of the recognition of the Medium Term Incentive Plans |
- | - | - | - | - | 290,303 | - | 290,303 | - | 290,303 |
| Acquisition of own shares | - | (2,223,287) | - | - | 2,223,287 | - | (2,223,287) | - | - | (2,223,287) |
| Balance at 30 September 2011 | 366,246,868 | (13,594,518) | 775,290,377 | 7,991,192 | 13,594,518 | 655,146 | 106,476,978 | 904,008,211 | 598,457 | 1,257,259,018 |
The notes are an integral part of the financial statements at 30 September 2012 and 2011.
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
For the periods ended at 30 September 2012 and 2011
| September 2012 | September 2011 | |||
|---|---|---|---|---|
| Operating activities | ||||
| Payments to employees | (2,146,437) | (2,396,352) | ||
| Cash flows from operating activities | (2,146,437) | (2,396,352) | ||
| Payments / receipts relating to income taxes, net | (989,737) | 926,884 | ||
| Other payments / receipts relating to operating activities, net | 7,222,133 | 3,579,984 | ||
| Cash flows from operating activities (1) | 4,085,959 | 4,085,959 | 2,110,516 | 2,110,516 |
| Investing activities | ||||
| Receipts from: | ||||
| Investments | 486,805,537 | 17,840,000 | ||
| Tangible assets | 267 | 800 | ||
| Interest and similar income | 7,902,638 | 8,946,767 | ||
| Loans granted | – | 170,611,000 | ||
| Dividends | 78,877,861 | 573,586,303 | – | 197,398,567 |
| Payments for: | ||||
| Investments | (140,318,810) | (175,550,291) | ||
| Tangible assets | (2,446) | (1,968) | ||
| Loans granted | (295,824,000) | (436,145,256) | (125,472,000) | (301,024,258) |
| Cash flows from investing activities (2) | 137,441,047 | (103,625,691) | ||
| Financing activities | ||||
| Receipts from: | ||||
| Loans obtained | 27,396,000 | 27,396,000 | 174,344,000 | 174,344,000 |
| Payments for: | ||||
| Interest and similar expenses | (12,364,518) | (8,578,611) | ||
| Acquisition of own shares | (2,175,315) | (2,223,287) | ||
| Loans obtained | (99,815,000) | (19,900,000) | ||
| Dividends | (25,172,240) | (139,527,073) | (17,859,403) | (48,561,301) |
| Cash flows from financing activities (3) | (112,131,073) | 125,782,699 | ||
| Net cash flows (4)=(1)+(2)+(3) | 29,395,933 | 24,267,524 | ||
| Cash and cash equivalents at the beginning of the period | 61,289,703 | 75,631,256 | ||
| Cash and cash equivalents at period end | 90,685,636 | 99,898,780 |
The notes are an integral part of the financial statements at 30 September 2012 and 2011.
Patrícia Maria Cruz Ribeiro da Silva
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
For the periods ended at 30 September 2012 and 2011
| 2012 | 2011 | |
|---|---|---|
| 1. Acquisition or sale of subsidiaries or other businesses | ||
| a) Other business activities | ||
| Sale of the share capital of Be Artis to Sonae telecom SGPS | 455,735,851 | – |
| Sale of the share capital of Sontária to Sonae telecom SGPS | 9,380,876 | – |
| Reimburse of supplementary capital from Be Artis | 14,943,304 | – |
| Reimburse of supplementary capital from PCJ - Público, Comunicação e Jornalismo, S.A. | 3,243,735 | – |
| Reimburse of supplementary capital from Público- Comunicação Social, S.A. | 3,501,771 | 17,840,000 |
| 486,805,537 | 17,840,000 | |
| b) Other business activities | ||
| Cash inflow to coverage losses Be Artis | 14,943,304 | – |
| Cash inflow do coverage losses PCJ - Público, Comunicação e Jornalismo, S.A. | 3,243,735 | – |
| Cash inflow to coverage losses Público - Comunicação Social, S.A. | 3,501,771 | – |
| Establishment of Sonaecom - Serviços Partilhados, S.A. | 50,000 | – |
| Supplementary capital to Sonae Telecom, SGPS, S.A. | 106,000,000 | – |
| Supplementary capital to Sonaecom Sistemas de Informação, SGPS, S.A. | 12,580,000 | – |
| Supplementary capital to PCJ - Público, Comunicação e Jornalismo, S.A. | – | 12,990,000 |
| Payment of Acquisiction Sontária- Empreendimentos Imobiliários, S.A. | – | 8,860,291 |
| Payment of Acquisiction Público - Comunicação Social, S.A. | – | 20,000,000 |
| Payment of Acquisiction of social participation Optimus - Comunicações S.A. | – | 133,700,000 |
| 140,318,810 | 175,550,291 | |
| c) Dividends received | ||
| Optimus - Comunicações, S.A. | 46,726,962 | – |
| Sonae Telecom, SGPS, S.A. | 17,434,926 | – |
| Sonae Com Sistemas de Informação, SGPS, S.A. | 14,132,500 | – |
| Sontária - Empreendimentos Imobiliários, S.A. | 583,473 | – |
| 78,877,861 | – | |
| 2. Details of cash and cash equivalents | ||
| Cash in hand | 1,532 | 10,063 |
| Cash at bank | 21,098 | 57,022 |
| Treasury applications | 103,301,000 | 100,170,000 |
| Overdrafts | (12,637,994) | (338,305) |
| Cash and cash equivalents | 90,685,636 | 99,898,780 |
| Overdrafts | 12,637,994 | 338,305 |
| Cash assets | 103,323,630 | 100,237,085 |
| 3. Description of non-monetary financing activities | ||
| a) Bank credit obtained and not used | 54,969,000 | 103,050,000 |
| b) Purchase of company through the issue of shares c) Conversion of loans into shares |
Not applicable Not applicable |
Not applicable Not applicable |
| The notes are an integral part of the financial statements at 30 September 2012 and 2011. | ||
| Chief Accountant | ||
| Patrícia Maria Cruz Ribeiro da Silva | ||
| The Board of Directors | ||
| Duarte Paulo Teixeira de Azevedo | Miguel Nuno Santos Almeida | Gervais Gilles Pellissier |
|---|---|---|
| Ângelo Gabriel Ribeirinho Paupério | António Sampaio e Mello | Jean-François René Pontal |
| António Bernardo Aranha da Gama Lobo Xavier | David Charles Denholm Hobley | Nuno Manuel Moniz Trigoso Jordão |
| Maria Cláudia Teixeira de Azevedo | Frank Emmanuel Dangeard |
SONAECOM, S.G.P.S., S.A., (hereinafter referred to as 'the Company' or 'Sonaecom') was established on 6 June 1988, under the name Sonae – Tecnologias de Informação, S.A. and has its head office at Lugar de Espido, Via Norte, Maia – Portugal.
Pargeste, S.G.P.S., S.A.'s subsidiaries in the communications and information technology area were transferred to the Company through a demerger-merger process, executed by public deed dated 30 September 1997.
On 3 November 1999, the Company's share capital was increased, its Articles of Association were modified and its name was changed to Sonae.com, S.G.P.S., S.A.. Since then the Company's corporate object has been the management of investments in other companies. Also on 3 November 1999, the Company's share capital was re-denominated to euro, being represented by one hundred and fifty million shares with a nominal value of 1 euro each.
On 1 June 2000, the Company carried out a Combined Share Offer, involving the following:
In addition to the Combined Share Offer, the Company's share capital was increased under the terms explained below. The new shares were fully subscribed for and paid up by Sonae, S.G.P.S., S.A. (a Shareholder of Sonaecom, hereinafter referred to as 'Sonae'). The capital increase was subscribed for and paid up on the date the price of the Combined Share Offer was determined, and paid up in cash, 31,000,000 new ordinary shares of 1 Euro each being issued. The subscription price for the new shares was the same as that fixed for the sale of shares in the aforementioned Combined Share Offer, which was Euro 10.
In addition, Sonae sold, in that year, 4,721,739 Sonaecom shares under an option granted to the banks leading the Institutional Offer for Sale and 1,507,865 shares to Sonae Group managers and to the former owners of the companies acquired by Sonaecom.
By decision of the Shareholders' General Meeting held on 17 June 2002, Sonaecom's share capital was increased from Euro 181,000,000 to Euro 226,250,000 by public subscription
reserved for the existing Shareholders, 45,250,000 new shares of 1 euro each having been fully subscribed for and paid up at the price of Euro 2.25 per share.
On 30 April 2003, the company's name was changed by public deed to SONAECOM, S.G.P.S., S.A..
By decision of the Shareholders' General Meeting held on 12 September 2005, Sonaecom's share capital was increased by Euro 70,276,868, from Euro 226,250,000 to Euro 296,526,868, by the issuance of 70,276,868 new shares of 1 euro each and with a share premium of Euro 242,455,195, fully subscribed by France Telecom. The corresponding public deed was executed on 15 November 2005.
By decision of the Shareholders' General Meeting held on 18 September 2006, Sonaecom's share capital was increased by Euro 69,720,000, from Euro 296,526,868 to Euro 366,246,868, by the issuance of 69,720,000 new shares of 1 euro each and with a share premium of Euro 275,657,217, subscribed by 093X – Telecomunicações Celulares, S.A. (EDP) and Parpública – Participações Públicas, SGPS, S.A. (Parpública). The corresponding public deed was executed on 18 October 2006.
By decision of the Shareholders General Meeting held on 16 April 2008, bearer shares were converted into registered shares.
The financial statements are presented in euro, rounded at unit.
The accompanying financial statements have been prepared on a going concern basis, based on the Company's accounting records in accordance with International Financial Reporting Standards (IAS/IFRS) as adopted by the European Union (EU) and considering the IAS 34 – 'Interim Financial Reporting'.
The adoption of the International Financial Reporting Standards (IFRS) as adopted by the European Union occurred for the first time in 2007 and as defined by IFRS 1 – 'First time adoption of International Financial Reporting Standards', 1 January 2006 was the date of transition from generally accepted accounting principles in Portugal to those standards.
For Sonaecom, there are no differences between IFRS as adopted by European Union and IFRS published by the International Accounting Standards Board.
Until the date of approval of these financial statements there are no standards, interpretations, amendments and revisions approved (endorsed) by the European Union and that have mandatory application to financial years beginning on or after 1 January 2012 and were first adopted in the period ended at 30 September 2012.
The following standards, interpretations, amendments and revisions have been at the date of approval of these financial statements, approved (endorsed) by the European Union, whose application is mandatory only in future financial years:
| Standard / Interpretation | Effective date (annual periods beginning on or after) |
|---|---|
| IAS 1 - Amendments (Presentation of Items of | 5-Jun-12 |
The amendments to IAS 1 require companies preparing financial statements in accordance with IFRSs to group together items within OCI that may be reclassified to the profit or loss section of the income statement.
IAS 19 - Amendments (Employee Benefits) 5-Jun-12
The amendments make important improvements by eliminating an option to defer the recognition of gains and losses, known as the 'corridor method', improving comparability and faithfulness of presentation, streamlining the presentation of changes in assets and liabilities arising from defined benefit plans and enhancing the disclosure requirements for defined benefit plans.
These standards, although approved (endorsed) by the European Union, were not adopted by the Company for the period ended at 30 September 2012, as the application of these standards is not yet mandatory. No significant impacts are expected to arise in the financial statements resulting from their adoption.
The following standards, interpretations, amendments and revisions have not yet been approved (endorsed) by the European Union, at the date of approval of these financial statements:
| Standard / Interpretation | Effective date (annual |
|---|---|
| periods beginning on or | |
| after) | |
| IFRS 1 - Amendments (Severe | 1-Jul-11 |
| Hyperinflation and Removal of Fixed Dates | |
| for First-Time Adopters) |
The amendments referred to the Severe Hyperinflation and Removal of Fixed Dates for First-Time Adopters: 1) replace the fixed dates in the derecognition exception and the exemption related to the initial fair value measurement of financial instruments; and 2) add a deemed cost exemption to IFRS 1 that an entity can apply at the date of transaction to IFRSs after being subject to severe hyperinflation.
| Standard / Interpretation | Effective date (annual periods beginning on or after) |
|---|---|
| IFRS 1 - Amendments (Government Loans) | 1-Jan-13 |
| The amendments referred to the Government Loans addresses how a first-time adopters would account for a government loan with a below market rate of interest when transitioning to IFRS and proposes to permit prospective application of IAS 20 requirements. |
|
| IFRS 7 Amendments (Offsetting Financial | 1-Jan-13 |
| Assets and Financial Liabilities: | |
| Disclosures) | |
| The amendment requires disclosures to improve the understanding of transfer transactions of financial assets (for example, securitisations), including understanding the possible effects of any risks that may remain after the transfer. It also requires additional disclosures if a disproportionate amount of transfer transactions are undertaken around the end of a reporting period. |
|
| IFRS 9 (Financial Instruments and | 1-Jan-15 |
| subsquent amendments) | |
| This standard is the first step in the project to replace IAS 39, and it introduces new requirements for classifying and measuring financial assets. |
|
| IFRS 10 (Consolidated Financial | 1-Jan-13 |
| Statements) | |
| determining factor in whether an entity should be included within the consolidated financial statements of the parent company. The standard provides additional guidance to assist in the determination of control where this is difficult to assess. |
|
| IFRS 11 (Joint Arrangements) | 1-Jan-13 |
| Provides for a more realistic reflection of joint arrangements by focusing on the rights and obligations of the arrangement, rather than its legal form (as is currently the case). The standard addresses inconsistencies in the reporting of joint arrangements by requiring a single method to account for interests in jointly controlled entities. |
|
| IFRS 12 (Disclosures of Interests in Other Entities) |
1-Jan-13 |
| New and comprehensive standard on disclosure requirements for all | |
| forms of interests in other entities, including joint arrangements, | |
| associates, special purpose vehicles and other off balance sheet vehicles. |
|
| IFRS 13 (Fair Value Measurement) | 1-Jan-13 |
| It will improve consistency and reduce complexity by providing, for the first time, a precise definition of fair value and a single source of fair value measurement and disclosure requirements for use across IFRSs. |
|
| Improvements to IFRS (2009-2011) | 1-Jan-13 |
| The IASB finalise its annual improvements publication corresponding to the 2009-2011 cycle including six amendments to five IFRSs. The annual improvements process provides a mechanism for non urgent |
|
| but necessary amendments to International Financial Reporting |
| Transition Guidance (Amendments to IFRS 10, IFRS 11 and IFRS 12) |
1-Jan-13 |
|---|---|
| The amendments clarify the transition guidance in IFRS 10 | |
| Consolidated Financial Statements and also provide additional transition | |
| relief in IFRS 11 Joint Arrangements and IFRS 12 Disclosure of Interests | |
| in Other Entities, limiting the requirement to provide adjusted | |
| comparative information to only the preceding comparative period. | |
| Furthermore, for disclosures related to unconsolidated structured | |
| entities, the amendments will remove the requirement to present | |
| comparative information for periods before IFRS 12 is first applied. | |
| IAS 12 - Amendments (Deferred tax: | 1-Jan-12 |
| Recovery of Underlying Assets) | |
| The amendment introduces, in the case of investment properties | |
| measured using the fair value model, the presumption that recovery of | |
| the carrying amount will normally be through sale, in order to determine | |
| their tax impact. As a result of the amendments, SIC 21 - 'Income | |
| Taxes—Recovery of Revalued Non-Depreciable Assets' would no longer apply to investment properties carried at fair value. The amendments |
|
| also incorporate into IAS 12 the remaining guidance previously | |
| contained in SIC-21, which is accordingly withdrawn. | |
| IAS 27 (Separate Financial Statements) | 1-Jan-13 |
| Consolidation requirements previously forming part of IAS 27 have | |
| been revised and are now contained in IFRS 10 Consolidated Financial | |
| Statements´. | |
| IAS 28 (Investments in Associates and Joint | 1-Jan-13 |
| Ventures) | |
| The objective of IAS 28 (as amended in 2011) is to prescribe the | |
| accounting for investments in associates and to set out the | |
| requirements for the application of the equity method when | |
| accounting for investments in associates and joint ventures. | |
| IAS 32 - Amendments (Offsetting Financial | 1-Jan-14 |
| Assets and Financial Liabilities) | |
| IAS 32 is amended to refer to the IFRS 7 disclosure requirements in | |
| respect of offsetting arrangements. | |
| IFRIC 20 Interpretation (Stripping Costs in | 1-Jan-13 |
| the Production Phase of a Surface Mine) |
The application of these standards and interpretations, as applicable to the Company will have no material effect on future financial statements of the Company.
The accounting policies and measurement criteria adopted by the Company at 30 September 2012 are comparable with those used in the preparation of the individual financial statements at 31 December 2011.
The main accounting policies used in the preparation of the accompanying financial statements are as follows:
Tangible assets are recorded at their acquisition cost less accumulated depreciation and less estimated accumulated impairment losses.
Depreciations are calculated on a straight-line monthly basis as from the date the assets are available for use in the necessary conditions to operate as intended by the management, by a corresponding charge to the profit and loss statement caption 'Depreciation and amortisation'.
Impairment losses detected in the realisation value of tangible assets are recorded in the year in which they arise, by a corresponding charge to the caption 'Depreciation and amortisation' of the profit and loss statement.
The annual depreciation rates used correspond to the estimated useful life of the assets, which are as follows:
| Years of useful life |
|
|---|---|
| Buildings and others constructions – improvements | |
| in buildings owned by third parties | 10-20 |
| Plant and machinery | 5-8 |
| Fixtures and fittings | 3-8 |
| Other tangible assets | 3 |
Current maintenance and repair costs of tangible assets are recorded as costs in the year in which they occur. Improvements of significant amount, which increase the estimated useful life of the assets, are capitalised and depreciated in accordance with the estimated useful life of the corresponding assets.
Intangible assets are recorded at their acquisition cost less accumulated amortisation and less estimated accumulated impairment losses. Intangible assets are only recognised, if it is likely that they will bring future economic benefits to the Company, if the Company controls them and if their cost can be reliably measured.
Intangible assets correspond, essentially, to software and industrial property.
Amortisations are calculated on a straight-line monthly basis, over the estimated useful life of the assets (three years) as from the month in which the corresponding expenses are incurred.
Amortisation for the period is recorded in the profit and loss statement under the caption 'Depreciation and amortisation'.
Investments in companies in which the Company has direct or indirect voting rights at Shareholders' General Meetings in excess of 50% or in which it has control over the financial and operating policies are recorded under the caption 'Investments in Group companies', at their acquisition cost, in accordance with IAS 27, as Sonaecom presents, separately, consolidated financial statements in accordance with IAS / IFRS.
Loans and supplementary capital granted to affiliated companies with maturities, estimated or defined contractually, greater than one year, are recorded, at their nominal value, under the caption 'Other non-current assets'.
Investments and loans granted to Group companies are evaluated whenever an event or change of circumstances indicates that the recorded amount may not be recoverable or impairment losses recorded in previous years no longer exist.
Impairment losses estimated for investments and loans granted to Group companies are recorded, in the year that they are estimated, under the caption 'Other financial expenses' in the profit and loss statement.
The expenses incurred with the acquisition of investments in Group companies are recorded as cost when they are incurred.
The Company classifies its financial instruments in the following categories: 'financial assets at fair value through profit or loss', 'loans and receivables', 'held-to-maturity investments', and 'available-for-sale financial assets'. The classification depends on the purpose for which the investments were acquired.
The classification of the investments is determined at the initial recognition and re-evaluated every quarter.
This category has two sub-categories: financial assets held for trading, and those designated at fair value through profit or loss at inception. A financial asset is classified in this category if it is acquired principally for the purpose of selling in the short term or if the adoption of this method allows reducing or eliminating an accounting mismatch. Derivatives are also registered as held for trading unless they are designated as hedges. Assets in this category are classified as current assets if they are either held for trading or are expected to mature within 12 months of the balance sheet date.
Loans and receivables are non-derivative financial assets with fixed or variable payments that are not quoted in an active
market. These financial investments arise when the Company provides money or services directly to a debtor with no intention of trading the receivable.
Loans and receivables are carried at amortised cost using the effective interest method, deducted from any impairment losses.
Loans and receivables are recorded as current assets, except when its maturity is greater than 12 months from the balance sheet date, a situation in which they are classified as noncurrent assets. Loans and receivables are included under the caption 'Other current debtors' in the balance sheet.
Held-to-maturity investments are non-derivative financial assets with fixed or variable payments and with fixed maturities that the Company's management has the positive intention and ability to hold until their maturity.
Available-for-sale financial assets are non-derivative investments that are either designated in this category or not classified in any of the other above referred categories. They are included in non-current assets unless management intends to dispose them within 12 months of the balance sheet date.
Purchases and sales of investments are recognised on tradedate – the date on which the Company commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs for all financial assets not carried at fair value through profit or loss. The 'Financial assets at fair value through profit or loss' are initially recognised at fair value and the transaction costs are recorded in the income statement. Investments are derecognised when the rights to receive cash flows from the investments have expired or transferred, and consequently all substantial risks and rewards of their ownership have been transferred.
'Available-for-sale financial assets' and 'Financial assets at fair value through profit or loss' are subsequently carried at fair value.
'Loans and receivables' and 'Held-to-maturity investments' are carried at amortised cost using the effective interest method.
Realised and unrealised gains and losses arising from changes in the fair value of financial assets classified at fair value through profit or loss are recognised in the income statement. Realised and unrealised gains and losses arising from changes in the fair value of non-monetary securities classified as available-for-sale are recognised in equity. When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments are included in the profit and loss statement as gains or losses from investment securities.
The fair value of quoted investments is based on current bid prices. If the market for a financial asset is not active (and for unlisted securities), the Company establishes fair value by using valuation techniques. These include the use of recent arm's length transactions, reference to similar instruments, discounted cash flow analysis, and option pricing models refined to reflect the issuer's specific circumstances. If none of these valuation techniques can be used, the Company values these investments at acquisition cost net of any identified impairment losses. The fair value of listed investments is determined based on the closing Euronext share price at the balance sheet date.
The Company assesses at each balance sheet date whether there is objective evidence that a financial asset or a group of financial assets is impaired. In case of equity securities classified as available-for-sale, a significant decline (above 25%) or prolonged decline (during two consecutive quarters) in the fair value of the security below its cost is considered in determining whether the securities are impaired. If such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment losses on that financial asset previously recognised in the profit or loss statement – is removed from equity and recognised in the profit and loss statement. Impairment losses recognised in the profit and loss statement on equity securities are not reversed through the profit and loss statement.
Lease contracts are classified as financial leases, if, in substance, all risks and rewards associated with the detention of the leased asset are transferred by the lease contract or as operational leases, if, in substance, there is no transfer of risks and rewards associated with the detention of the leased assets.
The lease contracts are classified as financial or operational in accordance with the substance and not with the form of the respective contracts.
Fixed assets acquired under finance lease contracts and the related liabilities are recorded in accordance with the financial method. Under this method the tangible assets, the corresponding accumulated depreciation and the related liability are recorded in accordance with the contractual financial plan at fair value or, if less, at the present value of payments. In addition, interest included in lease payments and depreciation of the tangible assets are recognised as expenses in the profit and loss statement for the period to which they relate.
Assets under long-term rental contracts are recorded in accordance with the operational lease method. In accordance with this method, the rents paid are recognised as an expense, over the rental period.
Other current debtors are recorded at their net realisable value, and do not include interest, because the financial updated effect is not significant.
These financial investments arise when the Company provides money or services directly to a debtor with no intention of trading the receivable.
The amount relating to this caption is presented net of any impairment losses, which are recorded in the profit and loss statement under the caption 'Provisions and impairment losses'. Future reversals of impairment losses are recorded in the profit and loss statement under the caption 'Other operating revenues'.
Amounts included under the caption 'Cash and cash equivalents' correspond to amounts held in cash and term bank deposits and other treasury applications where the risk of any change in value is insignificant.
The cash flow statement has been prepared in accordance with IAS 7 –'Statement of Cash Flow', using the direct method. The Company classifies, under the caption 'Cash and cash equivalents', investments that mature in less than three months, for which the risk of change in value is insignificant. The caption 'Cash and cash equivalents' in the cash flow statement also includes bank overdrafts, which are reflected in the balance sheet caption 'Short-term loans and other loans'. The cash flow statement is classified by operating, financing and investing activities. Operating activities include collections from customers, payments to suppliers, payments to personnel and other captions relating to operating activities.
Cash flows from investing activities include the acquisition and sale of investments in associated and subsidiary companies and receipts and payments resulting from the purchase and sale of fixed assets.
Cash flows from financing activities include payments and receipts relating to loans obtained and finance lease contracts.
All amounts included under this caption are likely to be realised in the short term and there are no amounts given or pledged as guarantee.
Loans are recorded as liabilities by the 'amortised cost'. Any expenses incurred in setting up loans are recorded as a deduction to the nominal debt and recognised during the period of the financing, based on the effective interest rate method. The interests incurred but not yet due are added to the loans caption until their payment.
Financial expenses relating to loans obtained are generally recognised as expenses at the time they are incurred. Financial expenses related to loans obtained for the acquisition, construction or production of fixed assets are capitalised as part of the cost of the assets. These expenses are capitalised starting from the time of preparation for the construction or development of the asset and are interrupted when the assets are ready to operate, at the end of the production or construction phases or when the associated project is suspended.
The Company only uses derivatives in the management of its financial risks to hedge against such risks. The Company does not use derivatives for trading purposes.
The cash flow hedges used by the Company are related to:
(i) Interest rate swaps operations to hedge against interest rate risks on loans obtained. The amounts, interest payment dates and repayment dates of the underlying interest rate swaps are similar in all respects to the conditions established for the contracted loans. Changes in the fair value of cash flow hedges are recorded in assets or liabilities, against a corresponding entry under the caption 'Hedging reserves' in Shareholders' funds;
(ii) Forward's exchange rate for hedging foreign exchange risk. The values and times periods involved are identical to the amounts invoiced and their maturities.
In cases where the hedge instrument is not effective, the amounts that arise from the adjustments to fair value are recorded directly in the profit and loss statement.
At 30 September 2012, the Company did not have any derivative, beyond those mentioned in note 1.s).
Provisions are recognised when, and only when, the Company has a present obligation (either legal or implicit) resulting from a past event, the resolution of which is likely to involve the disbursement of funds by an amount that can be reasonably estimated.
Provisions are reviewed at the balance sheet date and adjusted to reflect the best estimate at that date.
Provisions for restructurings are only registered if the Company has a detailed plan and if that plan has already been communicated to the parties involved.
Contingent liabilities are not recognised in the financial statements but are disclosed in the notes, except if the possibility of a cash outflow affecting future economic benefits is remote.
Contingent assets are not recognised in the financial statements but are disclosed in the notes when future economic benefits are likely to occur.
'Income tax' expense represents the sum of the tax currently payable and deferred tax. Income tax is recognised in accordance with IAS 12 – 'Income Tax'.
Sonaecom has adopted, since 1 January 2008, the special regime for the taxation of groups of companies, under which, the provision for income tax is determined on the basis of the estimated taxable income of all the companies covered by that regime, in accordance with such rules. The special regime for the taxation of groups of companies covers all subsidiaries on which the group holds at least 90% of their share capital, with its headquarters located in Portugal and subject to Corporate Income Tax (IRC).
Deferred taxes are calculated using the liability method and reflect the timing differences between the amount of assets and liabilities for accounting purposes and the respective amounts for tax purposes.
Deferred tax assets are only recognised when there is reasonable expectation that sufficient taxable profits shall arise in the future to allow such deferred tax assets to be used. At the end of each year, the recorded and unrecorded deferred tax assets are revised and they are reduced whenever their realisation ceases to be probable, or increased if future taxable profits are likely enabling the recovery of such assets (note 7).
Deferred taxes are calculated with the tax rate that is expected to be in effect at the time the asset or liability is realised.
Whenever deferred taxes derive from assets or liabilities directly registered in Shareholders' funds, its recording is also made under the Shareholders' funds caption. In all other situations, deferred taxes are always registered in the profit and loss statement.
Expenses and income are recorded in the period to which they relate, regardless of their date of payment or receipt. Estimated amounts are used when actual amounts are not known.
The captions 'Other non-current assets', 'Other current assets', 'Other non-current liabilities' and 'Other current liabilities' include expenses and income relating to the current period, where payment and receipt will occur in future periods, as well as payments and receipts in the current period but which relate to future periods. The latter shall be included by the corresponding amount in the results of the periods to which they relate to.
The costs attributable to current year and whose expenses will only occur in future years are estimated and recorded under the caption 'Other current liabilities' and 'Other non-current liabilities', when it is possible to estimate reliably the amount and the timing of occurrence of the expense. If there is uncertainty regarding both the date of disbursement of funds, and the amount of the obligation, the value is classified as Provisions (note 1.k).
Non-current financial assets and liabilities are recorded at fair value and, in each period, the financial actualisation of the fair value is recorded in the profit and loss statement under the captions 'Other financial expenses' and 'Other financial income'.
Dividends are recognised when the Shareholders' rights to receive such amounts are appropriately established and communicated.
Assets and liabilities due in more than one year from the date of the balance sheet are classified, respectively, as noncurrent assets and non-current liabilities.
In addition, considering their nature, the deferred taxes and the provisions for other liabilities and charges, are classified as non-current assets and liabilities (notes 7 and 13).
Portuguese commercial legislation requires that at least 5% of the annual net profit must be appropriated to a legal reserve, until such reserve reaches at least 20% of the share capital. This reserve is not distributable, except in case of liquidation of the Company, but may be used to absorb losses, after all the other reserves are exhausted, or to increase the share capital.
The share premiums relate to premiums generated in the issuance of capital or in capital increases. According to Portuguese law, share premiums follow the same requirements of 'Legal reserves', ie, they are not distributable, except in case of liquidation, but they can be used to absorb losses, after all the other reserves are exhausted or to increase share capital.
According to IFRS 2 – 'Share based payment', the responsibility related with the equity settled plans is registered, as a credit, under the caption of Medium Term Incentive Plan Reserves, which are not distributable and which can not be used to absorb losses.
Hedging reserve reflects the changes in fair value of 'cash flow' hedges derivatives that are considered effective (note 1.j)) and it is non distributable nor can it be used to absorb losses.
The own shares reserve reflects the acquisition value of the own shares and follows the same requirements of legal reserves.
Under Portuguese law, the amount of distributable reserves is determined in accordance with the individual financial statements of the Company, presented in accordance with IAS / IFRS.
Therefore, at 30 September 2012, Sonaecom, SGPS, S.A., have reserves which by their nature could be considered distributable, in the amount of around Euro 161.9 million.
Own shares are recorded as a deduction of Shareholders' funds. Gains or losses related to the sale of own shares are recorded under the caption 'Other reserves'.
All assets and liabilities expressed in foreign currency were translated into euro using the exchange rates in force at the balance sheet.
Favourable and unfavourable foreign exchange differences resulting from changes in the rates in force at transaction date and those in force at the date of collection, payment or at the balance sheet date are recorded as income and expenses in the profit and loss statement of the period, in financial results.
The following rates were used for the translation into euro:
| 2012 | 2011 | |||
|---|---|---|---|---|
| 30 | 30 | |||
| September | Average | September | Average | |
| Pounds Sterling | 1.2531 | 1.2321 | 1.1539 | 1.1478 |
| Swiss franc | 0.8265 | 0.8303 | 0.8217 | 0.8123 |
| Swedish krona | 0.1184 | 0.1146 | 0.1080 | 0.1111 |
| American Dollar | 0.7734 | 0.7812 | 0.7208 | 0.7389 |
Impairment tests are performed at the date of each balance sheet and whenever an event or change of circumstances indicates that the recorded amount of an asset may not be recoverable.
Whenever the book value of an asset is greater than the amount recoverable, an impairment loss is recognised and recorded in the profit and loss statement under the caption 'Depreciation and amortisation' in the case of fixed assets, under the caption 'Other financial expenses' in the case of
financial investments or under the caption 'Provisions and impairment losses', in relation to the other assets. The amount recoverable is the greater of the net selling price and the value of use. Net selling price is the amount obtained upon the sale of an asset in a transaction within the capability of the parties involved, less the costs directly related to the sale. The value of use is the present amount of the estimated future cash flows expected to result from the continued use of the asset and of its sale at the end of its useful life. The recoverable amount is estimated for each asset individually or, if this is not possible, for the cash-generating unit to which the asset belongs.
For financial investments, the recoverable amount, calculated in terms of value in use, is determined based on last business plans duly approved by the Board of Directors of the Company.
Evidence of the existence of impairment in accounts receivables appears when:
The accounting treatment of Medium Term Incentive Plans is based on IFRS 2 – 'Share-based Payments'.
Under IFRS 2, when the settlement of plans established by the Company involves the delivery of Sonaecom's own shares, the estimated responsibility is recorded, as a credit entry, under the caption 'Reserves – Medium Term Incentive Plans', within the caption 'Shareholders' funds' and is charged as an expense under the caption 'Staff expenses' in the profit and loss statement.
The quantification of this responsibility is based on its fair value at the attribution date and is recognised over the vesting period of each plan (from the award date of the plan until its vesting or settlement date). The total responsibility, at any point in time, is calculated based on the proportion of the vesting period that has 'elapsed' up to the respective accounting date.
When the responsibilities associated with any plan are covered by a hedging contract, ie, when those responsibilities are replaced by a fixed amount payable to a third party and when Sonaecom is no longer the party that will deliver the Sonaecom shares, at the settlement date of each plan, the above accounting treatment is subject to the following changes:
For plans settled in cash, the estimated liability is recorded under the balance sheet captions 'Other non-current liabilities' and 'Other current liabilities' by a corresponding entry to the income statement caption 'Staff expenses', for the cost relating to the vesting period that has 'elapsed' up to the respective accounting date. The liability is quantified based on the fair value of the shares as of each balance sheet date.
When the liability is covered by a hedging contract, recognition is made in the same way as described above, but with the liability being quantified based on the contractually fixed amount.
Equity-settled plans to be liquidated through the delivery of shares of the parent company are recorded as if they were settled in cash, which means that the estimated liability is recorded under the balance sheet captions 'Other non-current liabilities' and 'Other current liabilities' by a corresponding entry to the income statement caption 'Staff expenses', for the cost relating to the deferred period elapsed. The liability is quantified based on the fair value of the shares as of each balance sheet date.
At 30 September 2012, two plans of Sonaecom share plans were covered through the detention of own shares. For 2011 Sonaecom shares plan, the Company signed with Sonae SGPS, SA a contract that agrees to the transfer of Sonaecom SGPS shares for employees and board members of the Group as requested of Sonaecom and under the MTIP of Sonaecom and fixed the shares' acquisition price. The impacts associated to the Medium Term Incentive Plans are registered, in the balance sheet, under the caption 'Medium Term Incentive Plans Reserve'. The cost is recognized under the profit and loss statement caption 'Staff expenses'.
Regarding the plans liquidated through the delivery of shares of the parent company, the company entered, for all plans, into hedging contracts with an external entity under which the acquisition price of those shares was fixed. Therefore, the responsibility is recorded based on that fixed price, proportionally to the period of time elapsed since the award
date until the date of record, under the captions 'Other noncurrent liabilities' and 'Other current liabilities'. The cost is recognised on the income statement under the caption 'Staff expenses'.
Events occurring after the date of the balance sheet which provide additional information about conditions prevailing at the time of the balance sheet (adjusting events) are reflected in the financial statements. Events occurring after the balance sheet date that provide information on post-balance sheet conditions (non-adjusting events), when material, are disclosed in the notes to the financial statements.
The most significant accounting estimates reflected in the financial statements of the periods ended at 30 September 2012 and 2011 include mainly impairment analysis of assets, particularly financial investments in Group companies. Estimates used are based on the best information available during the preparation of financial statements and are based on the best knowledge of past and present events. Although future events are not controlled by the Company neither foreseeable, some could occur and have impact on the estimates. Changes to the estimates used by the management that occur after the approval date of these financial statements, will be recognised in net income, in accordance with IAS 8 – 'Accounting Policies, Changes in Accounting Estimates and Errors', using a prospective methodology.
The main estimates and assumptions in relation to future events included in the preparation of financial statements are disclosed in the respective notes.
The Company's activities expose it to a variety of financial risks such as market risk, liquidity risk and credit risk.
These risks arise from the unpredictability of financial markets, which affect the capacity to project cash flows and profits. The Company's financial risk management, subject to a long-term ongoing perspective, seeks to minimise potential adverse effects that derive from that uncertainty, using, every time it is possible and advisable, derivative financial instruments to hedge the exposure to such risks (note 1. j).
Foreign exchange risk management seeks to minimise the volatility of investments and transactions made in foreign currency and contributes to reduce the sensitivity of results to changes in foreign exchange rates.
Whenever possible, the Company uses natural hedges to manage exposure, by offsetting credits granted and credits received expressed in the same currency. When such procedure is not possible, the Company adopts derivative financial hedging instruments (note 1. j).
Considering the reduced values of assets and liabilities in foreign currency, the impact of a change in exchange rate will not have significant impacts on the financial statements.
Sonaecom's total debt is indexed to variable rates, exposing the total cost of debt to a high risk of volatility. The impact of this volatility in the Company results or in its Shareholders´ funds is mitigated by the effect of the following factors: (i) relatively low level of financial leverage; (ii) possibility to use derivative instruments that hedge the interest rate risk, as mentioned below; (iii) possible correlation between the level of market interest rates and economic growth the latter having a positive effect in other lines of the Company's results, and in this way partially offsetting the increase of financial costs ('natural hedge'); and (iv) the existence of stand alone or consolidated liquidity which is also bearing interest at a variable rate.
The Company only uses derivatives or similar transactions to hedge interest rate risks considered significant. Three main principles are followed in all instruments selected and used to hedge interest rate risk:
As all Sonaecom's borrowings (note 12) are at variable rates, interest rate swaps and other derivatives are used to hedge future changes in cash flow relating to interest payments. Interest rate swaps have the financial effect of converting the respective borrowings from floating rates to fixed rates. Under the interest rate swaps, the Company agrees with third parties (banks) to exchange, in pre-determined periods, the difference between the amount of interest calculated at the fixed contract rate and the floating rate at the time of re-fixing, by reference to the respective agreed notional amounts. The counterparties of the derivative hedging instruments are limited to highly rated financial institutions, being the Company's policy, when contracting such instruments, to give
preference to financial institutions that form part of its financing transactions.
In order to select the counterparty for occasional operations, Sonaecom requests proposals and indicative prices from a representative number of banks in order to ensure adequate competitiveness of these operations.
In determining the fair value of hedging operations, the Company uses certain methods, such as option valuation and discounted future cash flow models, using assumptions based on market interest rates prevailing at the balance sheet date. Comparative financial institution quotes for the specific or similar instruments are used as a benchmark for the valuation.
The fair value of the derivatives contracted, that are considered as fair value hedges or the ones that are considered not sufficiently effective for cash flow hedge (in accordance with the provisions established in IAS 39 – 'Financial Instruments'), are recognised under borrowings captions and changes in the fair value of such derivatives are recognised directly in the profit and loss statement for the period. The fair value of derivatives of cash flow hedge, that are considered effective according to IAS 39 – 'Financial Instruments', are recognised under borrowing captions and changes in the fair value are recognised in equity.
Sonaecom's Board of Directors approves the terms and conditions of the financing with significant impact in the Company, based on the analysis of the debt structure, the risks and the different options in the market, particularly as to the type of interest rate (fixed / variable). Under the policy defined above, the Executive Committee is responsible for the decision on the occasional interest rate hedging contracts, through the monitoring of the conditions and alternatives existing in the market.
The existence of liquidity in the Company requires the definition of some policies for an efficient and secure management of the liquidity, allowing us to maximise the profitability and to minimise the opportunity costs related with that liquidity.
The liquidity risk management has a threefold objective: (i) Liquidity, ie, to ensure the permanent access in the most efficient way to obtain sufficient funds to settle current payments in the respective dates of maturity as well as any eventual not forecasted requests for funds, in the deadlines set for this; (ii) Safety, ie, to minimise the probability of default in any reimbursement of application of funds; and (iii) Financial efficiency, ie, to ensure that the Company maximises the value / minimise the opportunity cost of holding excess liquidity in the short term.
The main underlying policies correspond to the variety of instruments allowed, the maximum acceptable level of risk, the maximum amount of exposure by counterparty and the maximum periods for investments.
The existing liquidity in the Company should be applied to the alternatives and by the order described below:
The applications in the market are limited to eligible counterparties, with ratings previously established by the Board and limited to certain maximum amounts by counterparty.
The definition of maximum amounts intends to assure that the application of liquidity in excess is made in a prudent way and taking into consideration the best practices in terms of bank relationships.
The maturity of applications should equalise the forecasted payments (or the applications should be easily convertible, in case of asset investments, to allow urgent and not estimated payments), considering a threshold for eventual deviations on the estimates. The threshold depends on the accuracy level of treasury estimates and would be determined by the business. The accuracy of the estimates is an important variable to quantify the amounts and the maturity of the applications in the market.
The maturity analysis for each of the liabilities associated to financial instruments is presented in the note 12.
The Company's exposure to credit risk is mainly associated with the accounts receivable related to current operational activities. The credit risk associated to financial operations is mitigated by the fact that the Company only negotiates with entities with high credit quality.
The management of this risk seeks to guarantee that the amounts owing are effectively collected within the periods negotiated without affecting the financial health of the Company.
The amounts included in the financial statements related to other current debtors, net of impairment losses, represent the maximum exposure of the Company to credit risk.
The movement in tangible assets and in the corresponding accumulated depreciation and impairment losses in periods ended at 30 September 2012 and 2011 was as follows:
| 2012 | ||||||
|---|---|---|---|---|---|---|
| Buildings and | Other | |||||
| other | Plant and | Fixtures and | tangible | |||
| constructions | machinery | Tools | fittings | assets | Total | |
| Gross assets | ||||||
| Balance at 31 December 2011 | 721,165 | 46,325 | 171 | 333,757 | 104 | 1,101,522 |
| Aditions | – | 360 | – | – | - | 360 |
| Balance at 30 September 2012 | 721,165 | 46,685 | 171 | 333,757 | 104 | 1,101,882 |
| Accumulated depreciation and impairment | ||||||
| losses | ||||||
| Balance at 31 December 2011 | 444,736 | 33,182 | 171 | 262,282 | 104 | 740,475 |
| Depreciation for the period | 31,083 | 5,486 | – | 13,486 | – | 50,055 |
| Balance at 30 September 2012 | 475,819 | 38,668 | 171 | 275,768 | 104 | 790,530 |
| Net value | 245,346 | 8,017 | – | 57,989 | – | 311,352 |
| 2011 | ||||||
|---|---|---|---|---|---|---|
| Buildings and other constructions |
Plant and machinery |
Tools | Fixtures and fittings |
Other tangible assets |
Total | |
| Gross assets | ||||||
| Balance at 31 December 2010 | 721,165 | 46,325 | 171 | 332,060 | 619 | 1,100,340 |
| Disposals | – | – | – | – | (515) | (515) |
| Balance at 30 September 2011 | 721,165 | 46,325 | 171 | 332,060 | 104 | 1,099,825 |
| Accumulated depreciation and impairment losses |
||||||
| Balance at 31 December 2010 | 403,292 | 25,891 | 170 | 241,851 | 318 | 671,522 |
| Depreciation for the period | 31,083 | 5,472 | – | 15,638 | 54 | 52,246 |
| Disposals | – | – | – | – | (268) | (268) |
| Balance at 30 September 2011 | 434,375 | 31,363 | 170 | 257,489 | 104 | 723,500 |
| Net value | 286,790 | 14,962 | 1 | 74,571 | – | 376,325 |
The movement in intangible assets and in the corresponding accumulated amortisation and impairment losses in the periods ended at 30 September 2012 and 2011, was as follows:
| 2012 | ||||
|---|---|---|---|---|
| Brands, patents | Intangible assets | |||
| and other rights | Software | in progress | Total | |
| Gross assets | ||||
| Balance at 31 December 2011 | 9,719 | 183,623 | – | 193,342 |
| Balance at 30 September 2012 | 9,719 | 183,623 | – | 193,342 |
| Accumulated depreciation and impairment losses | ||||
| Balance at 31 December 2011 | 8,316 | 182,741 | – | 191,057 |
| Depreciation for the period | 767 | 354 | – | 1,121 |
| Balance at 30 September 2012 | 9,083 | 183,095 | – | 192,178 |
| Net value | 636 | 528 | – | 1,164 |
| 2011 | ||||
| Brands, patents | Intangible assets | |||
| and other rights | Software | in progress | Total | |
| Gross assets | ||||
| Balance at 31 December 2010 | 9,719 | 183,247 | 376 | 193,342 |
| Aditions | – | 376 | (376) | – |
| Balance at 30 September 2011 | 9,719 | 183,623 | – | 193,342 |
| Accumulated depreciation and impairment losses | ||||
| Balance at 31 December 2010 | 7,281 | 177,585 | – | 184,866 |
| Depreciation for the period | 779 | 3,857 | – | 4,636 |
| Balance at 30 September 2011 | 8,060 | 181,442 | – | 189,502 |
| Net value | 1,659 | 2,181 | – | 3,840 |
At 30 September 2012 and 2011, the breakdown of financial instruments was as follows:
| 2012 | |||||
|---|---|---|---|---|---|
| Others not covered by | |||||
| Loans and receivables | Subtotal | IFRS 7 | Total | ||
| Non-current assets | |||||
| Other non-current assets (note 6) | 499,364,206 | 499,364,206 | – | 499,364,206 | |
| 499,364,206 | 499,364,206 | – | 499,364,206 | ||
| Current assets | |||||
| Other trade debtors (note 8) | 23,453,366 | 23,453,366 | 3,469,713 | 26,923,079 | |
| Cash and cash equivalents (note 9) | 103,323,630 | 103,323,630 | – | 103,323,630 | |
| 126,776,996 | 126,776,996 | 3,469,713 | 130,246,709 | ||
| 2011 | |||||
| Others not covered by | |||||
| Loans and receivables | Subtotal | IFRS 7 | Total | ||
| Non-current assets | |||||
| Other non-current assets (note 6) | 557,281,652 | 557,281,652 | – | 557,281,652 | |
| 557,281,652 | 557,281,652 | – | 557,281,652 | ||
| Current assets | |||||
| Other trade debtors (note 8) | 11,957,805 | 11,957,805 | 2,894,102 | 14,851,907 | |
| Cash and cash equivalents (note 9) | 100,237,085 | 100,237,085 | – | 100,237,085 | |
| 112,194,890 | 112,194,890 | 2,894,102 | 115,088,992 | ||
| 2012 | |||||
| Liabilities recorded at | Other financial | Others not covered by | |||
| Non-current liabilities | amortised cost | liabilities | Subtotal | IFRS 7 | Total |
| Medium and long-term loans – net of short-term | 188,796,920 | – | 188,796,920 | – | 188,796,920 |
| 188,796,920 | – | 188,796,920 | – | 188,796,920 | |
| Current liabilities | |||||
| Short-term loans and other loans (note 12) | 207,163,568 | – | 207,163,568 | – | 207,163,568 |
| Other creditors (note 14) | – | 316,340 | 316,340 | 118,388 | 434,728 |
| 207,163,568 | 316,340 | 207,479,908 | 118,388 | 207,598,296 | |
| 2011 | |||||
| Liabilities recorded at | Other financial | Others not covered by | |||
| amortised cost | liabilities | Subtotal | IFRS 7 | Total | |
| Non-current liabilities | |||||
| Medium and long-term loans – net of short | |||||
| term portion (note 12) | 318,344,375 | – | 318,344,375 | – | 318,344,375 |
| Current liabilities | 318,344,375 | – | 318,344,375 | – | 318,344,375 |
| Short-term loans and other loans (note 12) | 193,588,701 | – | 193,588,701 | – | 193,588,701 |
| Other creditors (note 14) | – | 1,766,381 | 1,766,381 | 3,320,377 | 5,086,758 |
| 193,588,701 | 1,766,381 | 195,355,082 | 3,320,377 | 198,675,459 |
Considering the nature of the balances, the amounts to be paid and received to / from 'State and other public entities' were considered outside the scope of IFRS 7. Also, the captions 'Other current assets' and 'Other current liabilities' were not included in this note, as the nature of such amounts are not within the scope of IFRS 7.
At 30 September 2012 and 2011, this caption included the following investments in Group companies:
| Company | 2012 | 2011 |
|---|---|---|
| Sonae Telecom, S.G.P.S., S.A. ('Sonae Telecom') * | 1,005,866,218 | 107,289,987 |
| Sonaetelecom BV | 75,009,902 | 75,009,902 |
| Sonae com – Sistemas de Informação, S.G.P.S., S.A. ('Sonae com SI') | 52,241,587 | 52,241,587 |
| Sonaecom BV | 25,020,000 | 25,020,000 |
| Miauger – Organização e Gestão de Leilões Electrónicos, S.A. ('Miauger') | 4,568,100 | 4,568,100 |
| Público - Comunicação Social, S.A. ('Público') | 3,738,230 | 1,000,000 |
| PCJ - Público, Comunicação e Jornalismo, S.A. ('PCJ') | 3,551,771 | 50,000 |
| Sonaecom - Serviços Partilhados, S.A. ('Sonaecom SP') | 50,000 | – |
| Optimus - Comunicações, S.A. ('Optimus') | – | 898,576,231 |
| Be Artis – Concepção, Construção e Gestão de Redes de Comunicações, S.A. ('Be Artis') | – | 8,230,885 |
| Sontária - Empreendimentos Imobiliários, S.A. ('Sontária') | – | 6,120,239 |
| 1,170,045,808 | 1,178,106,931 | |
| Impairment losses (note 13) | (86,868,004) | (77,409,902) |
| Total investments in Group companies | 1,083,177,804 | 1,100,697,029 |
* This company changed its name to OPTIMUS - SGPS, SA, at 12 October 2012
The movements that occurred in investments in Group companies during the periods ended at 30 September 2012 and 2011 were as follows:
| Balance at | Transfers and | Balance at | ||
|---|---|---|---|---|
| 31 December 2011 | write-offs | 30 September | ||
| 107,289,987 | 898,576,231 | – | – | 1,005,866,218 |
| 75,009,902 | – | – | – | 75,009,902 |
| 52,241,587 | – | – | – | 52,241,587 |
| 25,020,000 | – | – | – | 25,020,000 |
| 4,568,100 | – | – | – | 4,568,100 |
| 494,495 | 3,243,735 | – | – | 3,738,230 |
| 50,000 | 3,501,771 | – | – | 3,551,771 |
| – | 50,000 | – | – | 50,000 |
| 898,576,231 | – | (898,576,231) | – | - |
| 8,230,885 | 14,943,304 | (23,174,189) | – | – |
| 6,120,239 | – | (6,120,239) | – | – |
| 1,177,601,426 | 920,315,041 | (927,870,659) | – | 1,170,045,808 |
| (80,122,497) | (351,772) | – | (6,393,735) | (86,868,004) |
| 1,097,478,929 | 919,963,269 | (927,870,659) | (6,393,735) | 1,083,177,804 |
| Additions | Disposals |
* This company changed its name to OPTIMUS - SGPS, SA, at 12 October 2012
| Balance at 31 December 2010 |
Additions | Disposals | Transfers and write-offs |
Balance at 30 September |
|
|---|---|---|---|---|---|
| Optimus | 764,876,231 | 133,700,000 | – | – | 898,576,231 |
| Sonae Telecom | 107,289,987 | – | – | – | 107,289,987 |
| Sonaetelecom BV | 75,009,902 | – | – | – | 75,009,902 |
| Sonae com SI | 52,241,587 | – | – | – | 52,241,587 |
| Sonaecom BV | 25,020,000 | – | – | – | 25,020,000 |
| Be Artis | 8,230,885 | – | – | – | 8,230,885 |
| Sontária | 6,120,239 | – | – | – | 6,120,239 |
| Miauger | 4,568,100 | – | – | – | 4,568,100 |
| PCJ | 50,000 | – | – | – | 50,000 |
| Público | – | 1,000,000 | – | – | 1,000,000 |
| 1,043,406,931 | 134,700,000 | – | – | 1,178,106,931 | |
| Impairment losses (note 13) | (46,609,902) | (916,000) | – | (29,884,000) | (77,409,902) |
| 996,797,029 | 133,784,000 | – | (29,884,000) | 1,100,697,029 |
The additions and disposals occurred in Sonae Telecom and Optimus, respectively, are referred to Sonae Telecom SGPS' capital increase. This capital increase was fully subscribed by Sonaecom, through the delivery of 64.14% of the share capital of Optimus - Communications S.A.
Following this transaction, Sonae Telecom (wholly owned by Sonaecom) holds 100% of Optimus - Communications S.A.
In the period ended at 30 September 2012, Sonaecom sold the entire share capital of its subsidiaries Be Artis and Sontária to Sonae Telecom, a company wholly owned by Sonaecom. The participations were sold for the amount of Euro 456 million and Euro 9 million respectively, including share capital, loans and Supplementary capital (Note 6), generating a loss of circa Euro 360 thousand (note 16).
The amounts of Euro 14,943,304, Euro 3,243,735 and Euro 3,501,771 under the caption 'Additions' in Be Artis, Público and PCJ, relates to an increase of capital to cover losses.
The amount of Euro 50,000 under the caption 'Additions' at Sonaecom SP, relates to the constitution of Sonaecom Serviços Partilhados, S.A. in which the company owns 100%.
The variation in 'impairment losses' is related to the transfer of Euro 6,393,735 from the caption 'Other non-current assets' (note 6).
In the period ended at 30 September 2011, the amount of Euro 133,700,000 under the caption 'Additions' at Optimus relates to the acquisition of 10.60% of share capital of this subsidiary to Sonaecom BV. Now, the company holds 64.14% of Optimus share capital.
The amount of Euro 1,000,000, in the period ended at 30 September 2011, relates to the acquisition of the entire share capital of Público – Comunicação Social, S.A. to Sonaetelecom BV.
The variation in 'Impairment losses', in the period ended at 30 September 2011, result from the increase made in the amount of Euro 916,000 and the transfer of Euro 29,884,000 to the caption 'Other non-current assets' (note 6).
The Company presents separate consolidated financial statements at 30 September 2012, in accordance with International Financial Reporting Standards (IAS / IFRS) as adopted by the European Union, which presents total consolidated assets of Euro 1,902,646,249, total consolidated liabilities of Euro 832,627,239, consolidated operational revenues of Euro 623,749,407 and consolidated Shareholders' funds of Euro 1,070.019.010, including a consolidated net profit (attributable to the Shareholders of the parent company – Sonaecom, S.G.P.S., S.A.) for the year ended at 30 September 2012 of Euro 63.902.108.
At 30 September 2012 and 2011, the main financial information regarding the subsidiaries directly owned by the Company is as follows (values in accordance with IAS / IFRS):
| 2012 | 2011 | ||||||
|---|---|---|---|---|---|---|---|
| Shareholders | Net profit / | Shareholders' | Net profit / | ||||
| Company | Head office | % holding | ' funds | (loss) | % holding | funds | (loss) |
| Sonae Telecom | Maia | 100% | 977,340,189 | 28,538,428 | 100% | 165,243,328 | (8,706) |
| Sonae com SI | Maia | 100% | 74,039,481 | 35,596,794 | 100% | 39,943,570 | 392,987 |
| Miauger | Maia | 100% | (29,002) | (56,368) | 100% | 488,572 | (771,465) |
| Sonaetelecom BV | Amesterdam | 100% | 1,614,014 | 1,387 | 100% | 1,624,101 | 1,379,660 |
| Sonaecom BV | Amesterdam | 100% | 14,571,193 | (92,727) | 100% | 14,590,356 | 1,094,108 |
| PCJ | Maia | 100% | 9,992,407 | 454,178 | 100% | 13,482,002 | 442,002 |
| Público | Oporto | 100% | (3,146,962) | (3,528,732) | 100% | (936,173) | (2,717,677) |
| Sonaecom SP (a) | Maia | 100% | 50,083 | 83 | – | – | – |
| Optimus (b) | Maia | – | – | – | 64.14% | 492,075,699 | 42,873,827 |
| Sontária (c) | Maia | – | – | – | 100% | 935,018 | 301,215 |
| Be Artis (c) | Maia | – | – | – | 100% | 153,937,311 | (13,324,338) |
(a) Company established in January 2012
(b) Share capital sold in September 2012
(c) Companies sold in June 2012
The evaluation of the existence of impairment losses for the main investments in the Group companies is made by taking into account the cash-generating units, based on most up-to-date business plans duly approved by the Group's Board of Directors, which include projected cash flows for periods of five years. The discount rates used were based on the estimated weighted average cost of capital, which depends on the business segment of each subsidiary, and are as indicated in the table below. In perpetuity, the Group considered a growth rate of circa 3% or others considered more conservative, for specific cases. In situations where the measurement of the existence, or not, of impairment is made based on the net selling price, values of similar transactions and other proposals made are used.
| Discount rate | |
|---|---|
| Telecommunications | 9.50% |
| Multimedia | 12.00% |
| Information systems | 14.00% |
At 30 September 2012 and 2011, this caption was made up as follows:
| 2012 | 2011 | |
|---|---|---|
| Financial assets | ||
| Medium and long-term loans granted to Group companies: | ||
| Sonae Telecom SGPS * | 312,850,000 | – |
| Sonae com SI | 13,805,000 | 17,300,000 |
| Sonaecom BV | 8,455,000 | 19,668,000 |
| PCJ | 4,730,000 | 5,000,000 |
| Sontária | – | 2,676,637 |
| Be Artis | – | 296,192,000 |
| Sonaetelecom BV | – | 900,000 |
| Lugares Virtuais | – | 700,000 |
| 339,840,000 | 342,436,637 | |
| Supplementary capital: | ||
| Sonae Telecom SGPS * | 144,630,000 | 38,630,000 |
| Sonae com SI | 12,580,000 | – |
| PCJ | 9,488,228 | 12,990,000 |
| Miauger | 1,105,000 | 800,000 |
| Público | 321,770 | 1,160,000 |
| Be Artis | – | 165,889,115 |
| 168,124,998 | 219,469,115 | |
| 507,964,998 | 561,905,752 | |
| Accumulated impairment losses (note 13) | (8,654,998) | (4,624,100) |
| Others | 54,206 | - |
| 499,364,206 | 557,281,652 |
* This company changed its name to OPTIMUS - SGPS, SA, at 12 October 2012
During the periods ended at 30 September 2012 and 2011, the movements that occurred in 'Medium and long-term loans granted to Group companies' were as follows:
| 2012 | ||||
|---|---|---|---|---|
| Company Sonae Telecom SGPS * |
Opening balance | Increases | Decreases | Closing balance |
| - | 312,850,000 | – | 312,850,000 | |
| Sonae com SI | 19,700,000 | 5,790,000 | (11,685,000) | 13,805,000 |
| Sonaecom BV | 21,785,000 | – | (13,330,000) | 8,455,000 |
| PCJ | 5,160,000 | – | (430,000) | 4,730,000 |
| Sontária | 2,676,637 | 584,000 | (3,260,637) | – |
| Be Artis | 179,734,000 | 2,245,000 | (181,979,000) | – |
| Sonaetelecom BV | 200,000 | – | (200,000) | – |
| Optimus | – | 22,850,000 | (22,850,000) | – |
| 229,255,637 | 344,319,000 | (233,734,637) | 339,840,000 | |
* This company changed its name to OPTIMUS - SGPS, SA, at 12 October 2012
| 2011 | ||||
|---|---|---|---|---|
| Company | Opening balance | Increases | Decreases | Closing balance |
| Be Artis | 175,720,000 | 120,472,000 | – | 296,192,000 |
| Sonaecom BV | 168,158,000 | – | (148,490,000) | 19,668,000 |
| Sonae com SI | 21,190,000 | – | (3,890,000) | 17,300,000 |
| Sonaetelecom BV | 18,141,000 | – | (17,241,000) | 900,000 |
| Sontária | 2,676,637 | – | – | 2,676,637 |
| Lugares Virtuais | 1,170,000 | – | (470,000) | 700,000 |
| Wedo Consulting | 520,000 | – | (520,000) | – |
| PCJ | – | 5,000,000 | – | 5,000,000 |
| 387,575,637 | 125,472,000 | (170,611,000) | 342,436,637 |
During the periods ended at 30 September 2012 and 2011, the movements in 'Supplementary capital' were as follows:
| 2012 | ||||
|---|---|---|---|---|
| Company | Opening balance | Increases | Decreases | Closing balance |
| Sonae Telecom SGPS * | 38,630,000 | 106,000,000 | – | 144,630,000 |
| Sonae com SI | - | 12,580,000 | – | 12,580,000 |
| PCJ | 12,990,000 | – | (3,501,772) | 9,488,228 |
| Miauger | 1,105,000 | – | – | 1,105,000 |
| Público | 3,565,505 | – | (3,243,735) | 321,770 |
| Be Artis | 265,889,115 | – | (265,889,115) | – |
| 322,179,620 | 118,580,000 | (272,634,622) | 168,124,998 |
* This company changed its name to OPTIMUS - SGPS, SA, at 12 October 2012
| 2011 | ||||
|---|---|---|---|---|
| Company Be Artis |
Opening balance 165,889,115 |
Increases – |
Decreases – |
Closing balance 165,889,115 |
| Sonae Telecom SGPS * | 38,630,000 | – | – | 38,630,000 |
| MIauger | 800,000 | – | – | 800,000 |
| PCJ | – | 12,990,000 | – | 12,990,000 |
| Público | – | 19,000,000 | (17,840,000) | 1,160,000 |
| 205,319,115 | 31,990,000 | (17,840,000) | 219,469,115 |
* This company changed its name to OPTIMUS - SGPS, SA, at 12 October 2012
The decreases of the loans in Be Artis and in Sontária, in the amount of Euro 182 million and Euro 3,3 million, are related to the sale of these companies to Sonae Telecom, as described in note 5. The sale also includes Euro 251 million of supplementary capital in Be Artis. Besides this movement, the decrease of supplementary capital in an amount of Euro 266 million, includes a repayment of Euro 14 million to Sonaecom.
During the periods ended at 30 September 2012 and 2011, the loans granted to Group companies earned interest at market rates with an average interest rate of 4.53% and 4.09%, respectively. Supplementary capital is non-interest bearing.
During the periods ended in September 2012 and 2011 the movements under the caption 'Accumulated impairment losses' were as follows:
| 2012 | |||||
|---|---|---|---|---|---|
| Company | Opening balance | Increases | Decreases | Transfers | Closing balance |
| Acumulated impairment losses (note 13) | (8,555,505) | (6,493,228) | - | 6,393,735 | (8,654,998) |
| 2011 | |||||
| Company | Opening balance | Increases | Decreases | Transfers | Closing balance |
| Acumulated impairment losses (note 13) | (32,188,100) | (2,320,000) | - | 29,884,000 | (4,624,100) |
The movement under the caption 'Accumulated impairment losses' results from the transfer in the amount of Euro 6,393,735 to the caption 'Investments in Group companies' (note 5), partially compensated by the increase done during the period of an amount of Euro 6.493.228 (Note 13).
Loans granted to Group companies and Supplementary capital, do not have a defined maturity, therefore no information about the aging of these loans is presented.
The evaluation of the existence of impairment losses for the loans made to Group companies was based on the most up-to-date business plans duly approved by the Group's Board of Directors, which include projected cash flows for periods of five years. The discount rates used and the perpetuity growth considered are presented in the previous note (note 5).
At 30 September 2012, the value of deferred tax assets not recorded where it is not expected that sufficient taxable profits will be generated in the future to cover those losses, have the following detail:
| Year of origin | Tax losses | Provisions not acceptable for tax purposes |
Total | Deferred tax assets |
|---|---|---|---|---|
| 2001 | – | 3,463,000 | 3,463,000 | 917,695 |
| 2002 | – | 11,431,819 | 11,431,819 | 3,029,432 |
| 2003 | – | 31,154,781 | 31,154,781 | 8,256,017 |
| 2004 | – | 9,662,981 | 9,662,981 | 2,560,690 |
| 2005 | – | (3,033,899) | (3,033,899) | (803,983) |
| 2006 | 16,869,788 | (149,858) | 16,719,930 | 4,177,735 |
| 2007 | 54,563,604 | (537,036) | 54,026,568 | 13,498,586 |
| 2008 | – | 9,893,940 | 9,893,940 | 2,621,894 |
| 2009 | – | 9,903,475 | 9,903,475 | 2,624,421 |
| 2010 | – | 8,225,377 | 8,225,377 | 2,179,725 |
| 2011 | – | 10,005,009 | 10,005,009 | 2,651,327 |
| 2012 | – | 6,845,000 | 6,845,000 | 859,660 |
| 71,433,392 | 96,864,589 | 168,297,981 | 42,573,199 |
The rate used at 30 September 2012 to calculate the deferred tax assets/liabilities relating to tax losses carried forward was of 25%, and of 26.5% for remaining deferred tax assets and liabilities. It wasn't considered the state surcharge, as it was understood to be unlikely the taxation of temporary differences during the estimated period when the referred rate will be applicable.
The reconciliation between the earnings before tax and the tax recorded for the periods ended at 30 September 2012 and 2011 is as follows:
| 2012 | 2011 | |
|---|---|---|
| Earnings before tax | 90,485,074 | 2,614,079 |
| Income tax rate (25%) | (22,621,269) | (653,520) |
| Correction to previous year tax | 474 | (334,971) |
| Movements in provisions not accepted for tax purposes | (1,711,250) | (912,402) |
| Other taxes related with current income tax | (10,260) | (114,729) |
| Adjustments to the taxable income | 24,975,883 | - |
| Income taxation recorded in the period | 633,578 | (2,015,622) |
The adjustments to the taxable income in 2012 relates, mainly, to dividends received (note 16), which do not contribute to the calculation of the taxable profit for the year.
Portuguese Tax Authorities can review the income tax returns of the Company for a period of four years (five years for Social Security), except when tax losses have been generated, tax benefits have been granted or when any review, claim or impugnation is in progress, in which circumstances, the periods are extended or suspended. Consequently, tax returns of each year, since the year 2008 (inclusive) are still subject to such review. The Board of Directors believes that any correction that may arise as a result of such review would not produce a significant impact in the accompanying financial statements.
Supported by the Company's lawyers and tax consultants, the Board of Directors believes that there are no liabilities not provisioned in the financial statements, associated to probable tax contingencies that should have been recorded or disclosed in the accompanying financial statements, at 30 September 2012.
At 30 September 2012 and 2011, this caption was made up as follows:
| 2012 | 2011 | |
|---|---|---|
| Dividends to be received | 21,448,416 | - |
| Trade debtors | 2,004,950 | 11,959,735 |
| State and other public entities | 3,469,713 | 2,894,102 |
| Accumulated impairment losses on accounts receivables (note 13) | - | (1,930) |
| 26,923,079 | 14,851,907 |
At 30 September 2012, the subsidiary Optimus – Comunicações S.A. distributed dividends, to be paid at October 2012. The caption 'Other current debtors' included amounts to be received from Group companies related to dividends of Optimus, interests receivable from subsidiaries on Shareholders' loans, interest on treasury applications and services rendered (note 18).
The caption 'State and other public entities', at 30 September 2012 and 2011, includes the special advanced payment, retentions and taxes to be recovered.
At 30 September 2012 and 2011, the breakdown of cash and cash equivalents was as follows:
| 2012 | 2011 | |
|---|---|---|
| Cash | 1,532 | 10,063 |
| Bank deposits repayable on demand | 21,098 | 57,022 |
| Treasury applications | 103,301,000 | 100,170,000 |
| 103,323,630 | 100,237,085 | |
| Bank overdrafts (note 12) | (12,637,994) | (338,305) |
| 90,685,636 | 99,898,780 |
At 30 September 2012 and 2011, the caption 'Treasury applications' had the following breakdown:
| 2012 | 2011 | |
|---|---|---|
| Aplicações bancárias | - | 90,000,000 |
| Sonae Telecom SGPS | 86,716,000 | - |
| Wedo | 12,450,000 | 5,900,000 |
| Público | 3,120,000 | 1,290,000 |
| Lugares Virtuais | 610,000 | 225,000 |
| Mainroad | 270,000 | - |
| PCJ | 80,000 | 230,000 |
| Sonaecom SI | 55,000 | - |
| Be Towering | - | 2,525,000 |
| 103,301,000 | 100,170,000 |
During the period ended at 30 September 2012, the above mentioned treasury applications bear interests at an average rate of 4.21% (4.13% in 2011).
At 30 September 2012 and 2011, the share capital of Sonaecom was comprised by 366,246,868 ordinary registered shares of 1 euro each. At those dates, the Shareholder structure was as follows:
| 2012 | 2011 | |||
|---|---|---|---|---|
| Number of shares |
% | Number of shares | % | |
| Sontel BV | 194,063,119 | 52.99% | 194,063,119 | 52.99% |
| Shares traded on the Portuguese Stock Exchange ('Free float') | 75,977,185 | 20.74% | 76,737,177 | 20.95% |
| Atlas Service Belgium | 73,249,374 | 20.00% | 73,249,374 | 20.00% |
| Millennium BCP | 12,500,998 | 3.41% | 12,500,998 | 3.41% |
| Own shares | 7,025,192 | 1.92% | 9,045,200 | 2.47% |
| Sonae SGPS | 3,430,000 | 0.94% | 650,000 | 0.18% |
| Efanor Investimentos, S.G.P.S., S.A. | 1,000 | 0.00% | 1,000 | 0.00% |
| 366,246,868 | 100.00% | 366,246,868 | 100.00% |
All shares that comprise the share capital of Sonaecom, are authorised, subscribed and paid. All shares have the same rights and each share corresponds to one vote.
During the period ended at 30 September 2012, Sonaecom delivered to its employees 325,098 own shares under its Medium Term Incentive Plans.
Additionally, Sonaecom sold to its subsidiaries 3,477,010 shares (at an average price of Euro 1.171), under the Medium Term Incentive Plan of each company, and a loan in shares to some subsidiaries corresponding to 1,026,126 shares, based on a price of Euro 1.91.
During the period ended at 30 September 2012, the Company acquired 1,782,100 new shares (at an average price of Euro 1.221) and received from the subsidiaries, as a result of the mentioned loan, 1.026.126 shares, holding at the end of the period 7,025,192 own shares, representative of 1.92% of its share capital, with an average price of Euro 1.4778.
At 30 September 2012 and 2011, the caption 'Loans' had the following breakdown:
| Amount outstanding | |||||
|---|---|---|---|---|---|
| Issue denomination | Limit | Maturity | Type of reimbursement |
2011 | |
| 2012 | |||||
| 'Obrigações Sonaecom SGPS 2005' | 150,000,000 | Jun-13 | Final | - | 150,000,000 |
| 'Obrigações Sonaecom SGPS 2011' | 100,000,000 | Mar-15 | Final | 100,000,000 | 100,000,000 |
| 'Obrigações Sonaecom SGPS 2010' | 40,000,000 | Mar-15 | Final | 40,000,000 | 40,000,000 |
| 'Obrigações Sonaecom SGPS 2010' | 30,000,000 | Feb-13 | Final | - | 30,000,000 |
| 'Obrigações Sonaecom SGPS 2012' | 20,000,000 | Jul-15 | Final | 20,000,000 | - |
| Costs associated with setting-up the | |||||
| financing | – | – | – | (2,173,132) | (3,089,220) |
| Interests incurred but not yet due | – | – | – | 1,166,105 | 1,433,595 |
| 158,992,973 | 318,344,375 | ||||
| Commercial paper | 30,000,000 | Jul-15 | – | 30,000,000 | – |
| Costs associated with setting-up the | |||||
| financing | – | – | – | (242,602) | – |
| Interests incurred but not yet due | – | – | – | 46,549 | – |
| 29,803,947 | – | ||||
| 188,796,920 | 318,344,375 | ||||
| Amount outstanding | |||||
|---|---|---|---|---|---|
| Type of | |||||
| Issue denomination | Limit | Maturity | reimbursement | 2012 | 2011 |
| 'Obrigações Sonaecom SGPS 2005' | 150,000,000 | Jun-13 | Final | 150,000,000 | – |
| 'Obrigações Sonaecom SGPS 2010' | 30,000,000 | Feb-13 | Final | 30,000,000 | – |
| 180,000,000 | – | ||||
| Commercial paper | 150,000,000 | Jul-12 | – | - | 120,950,000 |
| Interest incurred but not yet due | – | – | – | - | 406,865 |
| - | 121,356,865 | ||||
| Tresuary applications | – | – | – | 7,129,574 | 71,893,532 |
| Overdrafts facilities – CGD | 16,500,000 | – | – | 7,396,000 | – |
| Bank overdrafts (note 9) | 10,000,000 | – | – | 9,996,000 | – |
| Bank overdrafts (note 9) | 2,500,000 | – | – | 1,639,000 | – |
| Bank overdrafts (note 9) | – | – | – | 1,002,994 | 338,305 |
| 27,163,568 | 72,231,837 | ||||
| 207,163,568 | 193,588,701 |
In June 2005, Sonaecom signed a Bond Loan, privately placed, amounting to 150 million euros without guarantees and with a maturity of eight years. The bonds bear interest at floating rate, indexed to Euribor and paid semiannually. This issue was organised and mounted by Millennium BCP Investimento.
In February and March 2010, Sonaecom signed two other Bond Loan, both privately placed, in the amount of 30 and 40 million euros, without guarantees and maturities of 3 and 5 years respectively. Both loans bear interest at floating rate indexed to Euribor, and paid semiannually. The issues were organised if mounted by, respectively, Banco Espirito Santo de Investimento and Caixa - Banco de Investimento. These bond issues were traded on Euronext Lisbon market.
In September 2011, Sonaecom signed a Bond Loan, privately placed, amounting to Euro 100 million without guarantees and with a maturity of three and half years. The bonds bear interest at floating rate indexed to Euribor and paid semiannually. This issue was organized and mounted by BNP Paribas, ING Belgium SA / NV and WestLB AG.
In July 2012, Sonaecom signed a Bond Loan, privately placed, amounting to Euro 20 million without guarantees and with the maturity of three years. The bonds bear interest at floating rate, indexed to Euribor and paid semiannually. This issue was organised and mounted by Banco BPI.
All the loans above are unsecured and the fulfillment of the obligations under these loans is exclusively guaranteed by the underlying activities and the indebted company cash flows generation capacity.
The average interest rate of the bond loans, in the period, was 3.23% (2.74% in 2011).
In July 2007, Sonaecom contracted a Commercial Paper Programme Issuance with a maximum amount of Euro 250 million with subscription grant and maturity of five years, organised by Banco Santander de Negócios Portugal and by Caixa – Banco de Investimento. According to the original terms, this programme was reduced to the amount of Euro 150 million in July 2010.
The placing underwriting consortium is composed by the following institutions: Banco Santander Totta, Caixa Geral de Depósitos, Banco BPI, Banco Bilbao Vizcaya Argentaria (Portugal), Banco Comercial Português and BNP Paribas (in Portugal).
Additionally, Sonaecom has three other Commercial Paper Programmes Issuance with subscription guarantee and the following characteristics:
| Amount | Hire date | Subscription guarantee | Maturity |
|---|---|---|---|
| Euro 30 million | May 2012 | Caixa Geral de Depósitos | 31-Jul-2015 |
| Euro 25 million | July 2012 | Banco Santander Totta | 31-Jul-2013 |
| Euro 15 million | June 2010 | Caixa Económica Montepio Geral | 19-Jul-2013 |
| Euro 5 million | April 2010 | Banco BPI | Possibly renewable at 20-Apr-2013 |
All the loans above are unsecured and the fulfillment of the obligations under these loans is exclusively guaranteed by the underlying activities and the indebted company cash flows generation capacity.
On 30 September 2012, the main financial constraints (covenants) included in debt contracts are related with the bond issue completed by Sonaecom during September 2011, totaling 100 million euros and establishing: (i) the requirement for Sonaecom, Optimus, Artis and Sonae Telecom, as well as the group companies whose both assets and EBITDA are equal or greater than 15% of the consolidated assets and the consolidated EBITDA (material subsidiaries) represent, as a whole, at least 80% of Sonaecom consolidated assets and consolidated EBITDA, and: (ii) the obligation to ensure that consolidated net debt does not exceed three times the consolidated EBITDA. Additionally, both this loan, as well as other loans are covered by Sonaecom negative pledge clauses, which impose certain restrictions on the mortgaging or pledging of the material subsidiaries' tangible assets and require the upholding of control over Optimus. The penalties applicable in the event of default in these covenants are generally the early payment of the loans obtained.
On 30 September 2012, Sonaecom was fully compliant with all the financial constraints above mentioned.
Sonaecom has also short term bank credit lines , in the form of current or overdraft account commitments, in the amount of Euro 29 million. These credit lines have maturities up to one year, automatically renewable, except in case of termination by either party, with some periods of notice.
All these loans and bank credit lines bear interest at market rates, indexed to the Euribor for the respective term, and were all contracted in euro.
| 2012 | 2011 | |
|---|---|---|
| Digitmarket | 3,773,749 | 2,676,107 |
| Sonaetelecom BV | 1,591,900 | 2,510,172 |
| Sonaecom BV | 1,410,000 | - |
| Saphety | 165,998 | 20,860 |
| Miauger | 100,585 | 496,615 |
| Sonaecom SP | 45,311 | - |
| Sonae Telecom | 41,853 | 68 |
| Wedo Consulting | 178 | 30 |
| Optimus | - | 64,030,888 |
| Mainroad | - | 1,748,646 |
| Be Towering | - | 33,226 |
| Be Artis | - | 8,074 |
| Público | - | 6,059 |
| Sontária | - | 351,840 |
| Sonae com SI | - | 10,590 |
| Lugares Virtuais | - | 358 |
| 7,129,574 | 71,893,532 |
During the periods ended at 30 September 2012 and 2011, the detail of 'Treasury applications' received from subsidiaries was as follows:
The treasury applications received from Group companies are payable in less than one year and earn interests at market rates. During the periods ended at 30 September 2012 and 2011, the treasury applications earned an average interest rate of 3.49% and 1.09%, respectively.
At 30 September 2012 and 2011, the repayment schedule of medium and long-term loans and of interests (nominal values), for both bonds and commercial paper were as follows (values based on the latest interest rate established for each type of loan):
| n+1 | n+2 | n+3 | n+4 | n+5 | |
|---|---|---|---|---|---|
| 2012 | |||||
| Bond loan | |||||
| Reimbursements | - | - | 160,000,000 | - | - |
| Interests | 5,840,402 | 5,840,402 | 3,160,802 | - | - |
| Commercial paper | |||||
| Reimbursements | - | - | 30,000,000 | - | - |
| Interests | 1,176,822 | 1,176,822 | 976,924 | - | - |
| 7,017,224 | 7,017,224 | 194,137,726 | - | - | |
| 2011 | |||||
| Bond loan | |||||
| Reimbursements | – | 180,000,000 | – | 140,000,000 | – |
| Interests | 11,546,600 | 9,708,677 | 6,479,600 | 3,083,429 | – |
| Commercial paper | |||||
| Reimbursements | – | – | – | – | – |
| Interests | – | – | – | – | – |
| 11,546,600 | 189,708,677 | 6,479,600 | 143,083,429 | - |
Although the maturity of commercial paper issuance is between one week and six months, the counterparties assumed the placement and the maintenance of those limits for a period of one to five years. As so, such liabilities are recorded in the medium and long.
At 30 September 2012 and 2011, the available credit lines of the Company are as follows:
| Maturity | |||||
|---|---|---|---|---|---|
| Amount | More than 12 | ||||
| Credit | Limit | outstanding | Amount available | Until 12 months | months |
| 2012 | |||||
| Commercial paper | 30,000,000 | 30,000,000 | - | x | |
| Commercial paper | 25,000,000 | - | 25,000,000 | x | |
| Commercial paper | 15,000,000 | - | 15,000,000 | x | |
| Commercial paper | 5,000,000 | - | 5,000,000 | x | |
| Bond loan | 150,000,000 | 150,000,000 | - | x | |
| Bond loan | 100,000,000 | 100,000,000 | - | x | |
| Bond loan | 40,000,000 | 40,000,000 | - | x | |
| Bond loan | 30,000,000 | 30,000,000 | - | x | |
| Bond loan | 20,000,000 | 20,000,000 | - | x | |
| Overdraft facilities | 16,500,000 | 7,396,000 | 9,104,000 | x | |
| Authorised overdrafts* | 10,000,000 | 9,996,000 | 4,000 | x | |
| Authorised overdrafts | 2,500,000 | 1,639,000 | 861,000 | x | |
| Others | - | 1,002,994 | - | x | |
| 444,000,000 | 390,033,994 | 54,969,000 | |||
| 2011 | |||||
| Commercial paper | 150,000,000 | 120,950,000 | 29,050,000 | x | |
| Commercial paper | 30,000,000 | - | 30,000,000 | x | |
| Commercial paper | 15,000,000 | - | 15,000,000 | x | |
| Commercial paper | 10,000,000 | - | 10,000,000 | x | |
| Bond loan | 150,000,000 | 150,000,000 | - | x | |
| Bond loan | 100,000,000 | 100,000,000 | - | x | |
| Bond loan | 40,000,000 | 40,000,000 | - | x | |
| Bond loan | 30,000,000 | 30,000,000 | - | x | |
| Overdraft facilities | 16,500,000 | - | 16,500,000 | x | |
| Authorised overdrafts | 2,500,000 | - | 2,500,000 | x | |
| Others | - | 338,305 | - | x | x |
| 544,000,000 | 441,288,305 | 103,050,000 |
*Can also be used in the form of commercial paper
At 30 September 2012 and 2011, there are no interest rate hedging instruments.
The movements in provisions and in accumulated impairment losses in the periods ended at 30 September 2012 and 2011 were as follows:
| Opening balance |
Increases | Transfers | Utilizations | Closing balance |
|
|---|---|---|---|---|---|
| 2012 | |||||
| Accumulated impairment losses on accounts receivables (note 8) Accumulated impairment losses on investments in Group |
1,930 | 15,387 | – | (17,317) | – |
| companies ( notes 5 and 16) | 80,122,497 | 351,772 | 6,393,735 | – | 86,868,004 |
| Accumulates impairment losses on other non-current assets | |||||
| (notes 6 and 16) | 8,555,505 | 6,493,228 | (6,393,735) | – | 8,654,998 |
| Provisions for other liabilities and charges | 68,654 | 2,280 | – | – | 70,934 |
| 88,748,586 | 6,862,667 | – | (17,317) | 95,593,936 | |
| 2011 | |||||
| Accumulated impairment losses on accounts receivables (note 8) | 1,930 | – | – | – | 1,930 |
| Accumulated impairment losses on investments in Group companies ( notes 5 and 16) |
46,609,902 | 916,000 | 29,884,000 | – | 77,409,902 |
| Accumulates impairment losses on other non-current assets (notes 6 and 16) |
32,188,099 | 2,320,000 | (29,884,000) | – | 4,624,100 |
| Provisions for other liabilities and charges | 56,487 | 12,167 | – | – | 68,654 |
| 78,856,418 | 3,248,167 | – | – | 82,104,586 |
The increases in provisions and impairment losses are recorded under the caption 'Provisions and impairment losses' in the profit and loss statement with the exception of the impairment losses in investments in Group companies and other non-current assets, which, due to their nature, are recorded as a financial expense under the caption 'Gains and losses on Group companies' (note 16).
At 30 September 2012 and 2011, the increase of 'Provisions for other liabilities and charges' includes the amount of Euro 2,280 and 12,167, respectively, registered in the financial statements, under the caption 'Income taxation', due to its' nature (note 17).
At 30 September 2012 and 2011, this caption was made up as follows:
| 2012 | 2011 | |
|---|---|---|
| Other creditors | 316,340 | 1,766,381 |
| State and other public entities | 118,388 | 3,320,377 |
| 434,728 | 5,086,758 |
At 30 September 2012 and 2011, this caption was made up as follows:
| 2012 | 2011 | |
|---|---|---|
| Specialised work | 1,192,833 | 1,313,212 |
| Rents and travelling expenses | 68,938 | 76,570 |
| Travel and accommodation | 64,035 | 53,374 |
| Other external supplies and services | 105,358 | 112,564 |
| 1,431,164 | 1,555,720 |
Net financial results for the periods ended 30 September 2012 and 2011 are made up as follows:
| 2012 | 2011 | |
|---|---|---|
| Gains and losses on investments in Group companies | ||
| Losses related to Group companies (notes 5, 6 and 13) | (7,208,149) | (3,236,000) |
| Gains related to Group companies | 100,326,277 | – |
| 93,118,128 | (3,236,000) | |
| Other financial expenses | ||
| Interest expenses: | ||
| Bank loans | (2,119,316) | (2,577,749) |
| Other loans | (8,213,908) | (5,177,460) |
| Overdrafts and others | (48,544) | (99) |
| (10,381,768) | (7,755,308) | |
| Foreign currency exchange losses | (1,509) | (503) |
| Other financial expenses | (275,945) | (223,403) |
| (277,454) | (223,906) | |
| (10,659,222) | (7,979,214) | |
| Other financial income | ||
| Interest income | 8,418,890 | 14,537,015 |
| 8,418,890 | 14,537,015 |
In 30 September 2012, the losses related to group companies include an amount Euros 363,149 related to the loss of the sale, to Sonae Telecom, of the entire capital of the share capital of Be Artis (note 5) and the increase of the impairment losses in other noncurrent assets (note 13), in the amount of Euro 6,493,228 and the investments in Group companies (note 13), in the amount of Euro 351,772.
At 30 September 2012, the caption 'Gains related to Group companies' relates to the dividends received from Optimus (Euro 68,175,377), Sonae Telecom (Euro 17,434,926), Sonae com SI (Euro 14,132,501) and Sontária (Euro 583,473).
Income taxes recognized during the periods ended at 30 September 2012 and 2011 were made up as follows ((costs) / gains):
| 2012 | 2011 | |
|---|---|---|
| Current tax | 635,858 | (2,003,455) |
| Tax provision (note 13) | (2,280) | (12,167) |
| Closing balance | 633,578 | (2,015,622) |
The most significant balances and transactions with related parties (which are detailed in the appendix) at 30 September 2012 and 2011 were as follows:
| Balances at 30 | |||||
|---|---|---|---|---|---|
| September 2012 | |||||
| Treasury | Other assets and | Loans granted / | |||
| Accounts receivable | Accounts payable | applications | liabilities | (obtained) | |
| Optimus | 22,038,502 | 188,267 | – | 256,244 | – |
| Artis | 620,508 | 2,771 | – | 290,722 | – |
| Sonae com SI | 280,036 | – | 55,000 | (145,478) | 13,805,000 |
| Sonaecom BV | 147,979 | – | – | 40,695 | 7,045,000 |
| Sonae Telecom SGPS | – | – | 86,716,000 | 218,832 | 312,808,147 |
| Be Towering | 60,510 | – | – | 19,657 | – |
| Público | 17,991 | 207 | 3,120,000 | 41,244 | – |
| Wedo | 55,452 | 42,700 | 12,450,000 | 71,464 | (178) |
| PCJ | 53,049 | – | 80,000 | 17,918 | 4,730,000 |
| Sonaetelecom BV | – | – | – | – | (1,591,900) |
| Others | 83,847 | 59,210 | 880,000 | (76,674) | (4,085,643) |
| 1,909,458 | 293,155 | 103,301,000 | 734,624 | 332,710,426 |
| Balances at 30 September 2011 |
|||||
|---|---|---|---|---|---|
| Treasury | Other assets and | Loans granted / | |||
| Accounts receivable | Accounts payable | applications | liabilities | (obtained) | |
| Optimus | 315,418 | 342,671 | – | 262,824 | (64,030,888) |
| Be Artis | 3,481,283 | 1,709,735 | – | 1,059,055 | 296,183,926 |
| Sonae com SI | 191,855 | 3,206 | – | 62,609 | 17,289,410 |
| Sonaecom BV | 7,489,989 | – | – | 88,178 | 19,668,000 |
| Sonae Telecom SGPS | – | 18,665 | – | – | (68) |
| Be Towering | 9,028 | – | 2,525,000 | (1,176) | (33,226) |
| Público | 58,962 | 375 | 1,290,000 | 16,920 | (6,059) |
| Wedo | 15,746 | (862,634) | 5,900,000 | 135,288 | (30) |
| PCJ | 55,338 | – | 230,000 | 54,015 | 5,000,000 |
| Sonaetelecom BV | 54,908 | – | – | 13,899 | (1,610,172) |
| Others | 96,183 | 528,099 | 225,000 | 77,344 | (1,917,789) |
| 11,768,710 | 1,740,117 | 10,170,000 | 1,768,956 | 270,543,104 |
| Transactions at 30 September 2012 |
||||
|---|---|---|---|---|
| Sales and services | Supplies and | Interest and similar | Supplementary | |
| rendered | services received | income / (expense) | income | |
| Optimus | 2,480,336 | 806,299 | 724,964 | – |
| Be Artis | – | 17,112 | 5,112,004 | – |
| Be Towering | – | (40,278) | 146,179 | – |
| Wedo | 116,145 | – | 119,168 | – |
| Sonaecom BV | – | – | 775,647 | – |
| Others | 288,848 | 286,015 | 1,143,730 | – |
| 2,885,329 | 1,069,148 | 8,021,692 | – |
| Transactions at 30 September 2011 |
||||
|---|---|---|---|---|
| Sales and services | Supplies and | Interest and similar | Supplementary | |
| rendered | services received | income / (expense) | income | |
| Optimus | 2,562,925 | 880,100 | (163,315) | – |
| Be Artis | – | (3,899) | 9,839,235 | (41) |
| Be Towering | – | (47,368) | (39,216) | – |
| Wedo | 116,035 | – | 141,486 | – |
| Sonaecom BV | – | – | 2,974,860 | – |
| Others | 277,662 | 141,362 | 1,000,838 | – |
| 2,956,622 | 970,195 | 13,753,888 | (41) |
Additionally, in the period ended at 30 September 2012, the Company sold Be Artis and Sontária to Sonae Telecom SGPS (Note 5) and proceeded to the capital increase of Sonae Telecom SGPS, by contribution in kind, through the delivery of the participation of 64,14% of Optimus – Comunicações, S.A..
In the period ended at 30 September 2012, the Group signed an agreement with Sonae SGPS, under which Sonae compromise to transfer to employees and board members of Sonaecom, Sonaecom shares, at the price of 1.184 euros, as requested by Sonaecom and under the MTIP of Sonaecom. Under this contract, Sonaecom paid to Sonae SGPS, SA the amount of EUR 3,291,520, which was recorded under the caption "Other reserves" in equity. Additionally, each of its subsidiaries, under the contracts agreed with Sonaecom, paid the amount due of EUR 3,015,020.
All the above transactions were made at market prices.
Accounts receivable and payable to related companies will be settled in cash and are not covered by guarantees. During the periods ended at 30 September 2012 and 2011, no impairment losses referring to related entities were recognised.
A complete list of the Sonaecom Group's related parties is presented in the appendix to this report.
Guarantees provided to third parties at 30 September 2012 and 2011 were as follows:
| Beneficiary | Description | 2012 | 2011 |
|---|---|---|---|
| Direção de Contribuições e Impostos (Portuguese tax authorities) | VAT reimbursements | 7,360,875 | 7,360,875 |
| Direção de Contribuições e Impostos (Portuguese tax authorities) | General supervision fiscal year 2005 | 754,368 | 754,368 |
| 8,115,243 | 8,115,243 |
In addition to these guarantees were set up two sureties for the current fiscal processes. The Sonae SGPS consisted of Sonaecom SGPS surety to the amount of Euro 2,844,270 and Sonaecom SGPS consisted of Optimus surety for the amount of Euro 9,264,267.
At 30 September 2012 and 2011, the Board of Directors of the Company believes that the decision of the court proceedings and ongoing tax assessments in progress will not have significant impacts on the financial statements.
Earnings per share, basic and diluted, are calculated by dividing the net income of the period (Euro 91,118,652 in 2012 and Euro 598,457 in 2011) by the average number of shares outstanding during the periods ended at 30 September 2012 and 2011, net of own shares (Euro 359,146,641 in 2012 and Euro 357,150,209 in 2011).
In June 2000, the Company created a discretionary Medium Term Incentive Plan for more senior employees, based on Sonaecom options and shares and Sonae S.G.P.S., S.A. shares. The vesting occurs three years after the award of each plan, assuming that the employees are still employed in the Company.
The Sonaecom plans outstanding at 30 September 2012 can be summarized as follows:
| Vesting period | 30 September 2012 | ||||
|---|---|---|---|---|---|
| Share price at award date* |
Award date | Vesting date | Aggregate number of participations |
Number of shares |
|
| Sonaecom shares | |||||
| 2008 Plan | 1.117 | 10-Mar-09 | 09-Mar-12 | – | – |
| 2009 Plan | 1.685 | 10-Mar-10 | 08-Mar-13 | 4 | 247,423 |
| 2010 Plan | 1.399 | 10-Mar-11 | 10-Mar-14 | 3 | 257,457 |
| 2011 Plan | 1.256 | 09-Mar-12 | 10-Mar-15 | 3 | 281,327 |
| Sonae SGPS shares | |||||
| 2008 Plan | 0.526 | 10-Mar-09 | 09-Mar-12 | – | – |
| 2009 Plan | 0.761 | 10-Mar-10 | 08-Mar-13 | 4 | 342,242 |
| 2010 Plan | 0.811 | 10-Mar-11 | 10-Mar-14 | 3 | 282,926 |
| 2011 Plan | 0.401 | 09-Mar-12 | 10-Mar-15 | 3 | 561,619 |
*Average share price in the month prior to the award date, for Sonaecom shares and the lower of the average share price for the month prior to the Annual General Meeting and the share price on the day after the Annual General Meeting, for Sonae SGPS shares.
During the period ended at 30 September 2012, the movements that occurred in the plans can be summarized as follows:
| Sonaecom shares | Sonae SGPS shares | |||
|---|---|---|---|---|
| Aggregate | Aggregate | |||
| number of Number of shares | number of Number of shares | |||
| Outstanding at 31 December 2011: | ||||
| Unvested | 11 | 799,220 | 11 | 981,095 |
| Total | 11 | 799,220 | 11 | 981,095 |
| Movements in year: | ||||
| Awarded | 3 | 264,188 | 3 | 516,837 |
| Vested | (4) | (325,098) | (4) | (405,776) |
| Cancelled / lapsed* | – | 47,897 | – | 94,631 |
| Outstanding at 30 September 2012: | ||||
| Unvested | 10 | 786,207 | 10 | 1,186,787 |
| Total | 10 | 786,207 | 10 | 1,186,787 |
* The adjustments are made for dividends paid and for share capital changes and others adjustments, namely, resulting from a change in the vesting of the MTIP, which may now be made through the purchase of shares with a discount.
For Sonaecom's share plans of 2009 and 2010, the responsibility was calculated taking into consideration the share price at the corresponding award date. For 2011 Sonaecom shares plan, the Company signed with Sonae SGPS, SA a contract that agrees to the transfer of Sonaecom SGPS shares for employees and board members of the Group as requested of Sonaecom and under the MTIP of Sonaecom, and the liabilities are calculated based on the price fixed in the contract. The responsibility for the three plans was recorded under the heading 'Medium Term Incentive Plans Reserve'. For the Sonae SGPS share plan, except for one of the plans, the Group entered into hedging contracts with external entities, and the responsibilities are calculated based on the prices agreed on those contracts. The responsibility for these plans is recorded under the captions 'Other current liabilities' and 'Other non-current liabilities'.
Share plan costs are recognised in the accounts over the period between the award and the vesting date of those plans. The costs recognised in previous years and in the period ended at 30 September 2012, were as follows:
| Value | |
|---|---|
| Costs recognised in previous years | 5,285,497 |
| Costs recognised in the period | 508,364 |
| Costs of plans vested in previous years | (4,062,646) |
| Costs of plans vested in the period | (771,223) |
| 959,992 | |
| Recorded in other current liabilities | 244,503 |
| Recorded in other non current liabilities | 104,833 |
| Recorded in reserves | 610,656 |
These financial statements were approved by the Board of Directors on 29 October 2012.
These financial statements are a translation of financial statements originally issued in Portuguese in accordance with International Financial Reporting Standards (IAS / IFRS) as adopted by the European Union and the format and disclosures required by those Standards, some of which may not conform to or be required by generally accepted accounting principles in other countries. In the event of discrepancies, the Portuguese language version prevails.
At 30 September 2012, the related parties of Sonaecom, S.G.P.S. are as follows
| Key management personnel - Sonaecom | ||||
|---|---|---|---|---|
| Ana Cristina Dinis da Silva Fanha Vicente Soares | Gervais Gilles Pellissier | |||
| Ana Paula Garrido Pina Marques | Jean-François René Pontal | |||
| Ângelo Gabriel Ribeirinho dos Santos Paupério | José Manuel Pinto Correia | |||
| António Bernardo Aranha da Gama Lobo Xavier | Manuel Antonio Neto Portugal Ramalho Eanes | |||
| António de Sampaio e Mello | Maria Cláudia Teixeira de Azevedo | |||
| David Charles Denholm Hobley | Miguel Nuno Santos Almeida | |||
| David Graham Shenton Bain | Nuno Manuel Moniz Trigoso Jordão | |||
| David Pedro Oliveira Parente Ferreira Alves | Paulo Joaquim dos Santos Plácido | |||
| Duarte Paulo Teixeira de Azevedo | Pedro Rafael de Sousa Nunes Pedro | |||
| Franck Emmanuel Dangeard | Rui José Silva Goncalves Paiva | |||
| Key management personnel - Sonae SGPS | |||
|---|---|---|---|
| Álvaro Carmona e Costa Portela | Christine Cross | ||
| Álvaro Cuervo Garcia | José Manuel Neves Adelino | ||
| Belmiro de Azevedo | Michel Marie Bon | ||
| Bernd Hubert Joachim Bothe |
| Sonaecom Group Companies | ||||
|---|---|---|---|---|
| Be Artis – Concepção ,Construção e Gestão de Redes de | Sonae Telecom, S.G.P.S., S.A. | |||
| Comunicações, S.A. | Sonaetelecom BV | |||
| Be Towering – Gestão de Torres de Telecomunicações, S.A. | Sonaecom, S.G.P.S., S.A. | |||
| Cape Technologies Limited | Sontária - Empreendimentos Imobiliários, S.A. | |||
| Connectiv Solutions, Inc. | SSI Angola, S.A. | |||
| Digitmarket – Sistemas de Informação, S.A. | Tecnológica Telecomunicações LTDA. | |||
| Infosystems – Sociedade de Sistemas de Informação, S.A. | Unipress – Centro Gráfico, Lda | |||
| Lugares Virtuais, S.A. | WeDo Consulting – Sistemas de Informação, S.A. | |||
| Mainroad – Serviços em Tecnologias de Informação, S.A. | WeDo Poland Sp. Z.o.o. | |||
| Miauger – Organização e Gestão de Leilões Electrónicos., S.A. | WeDo Technologies Americas, Inc. | |||
| Optimus – Comunicações, S.A. | WeDo Technologies Egypt LLC | |||
| PCJ - Público, Comunicação e Jornalismo, S.A. | WeDo Technologies Mexico, S de R.L. | |||
| Per-Mar – Sociedade de Construções, S.A. | WeDo Technologies BV | |||
| Praesidium Services Limited | WeDo Technologies Australia PTY Limited | |||
| Público – Comunicação Social, S.A. | WeDo Technologies (UK) Limited | |||
| Saphety Level – Trusted Services, S.A. | WeDo do Brasil – Soluções Informáticas, Ltda | |||
| Sonaecom - Serviços Partilhados, S.A. | WeDo Technologies BV – Sucursal Malaysia | |||
| Sociedade Independente de Radiodifusão Sonora, S.A. | WeDo Technologies Chile SpA. | |||
| Sonae com – Sistemas Informação, S.G.P.S., S.A. | We Do Technologies Panamá S.A. | |||
| Sonaecom – Sistemas de Información España, S.L. | We Do Technologies Singapore PTE. LTD. | |||
| Sonaecom BV |
| Sonae/Efanor Group Companies | |
|---|---|
| 3DO Holding GmbH | Avenida M – 40, S.A. |
| 3DO Shopping Centre GmbH | Azulino Imobiliária, S.A. |
| 3shoppings – Holding,SGPS, S.A. | BA Business Angels, SGPS, SA |
| 8ª Avenida Centro Comercial, SA | BA Capital, SGPS, SA |
| ADD Avaliações Engenharia de Avaliações e Perícias Ltda | BB Food Service, S.A. |
| ADDmakler Administração e Corretagem de Seguros Ltda | Beralands BV |
| ADDmakler Administradora, Corretora de Seguros Partic. Ltda | Bertimóvel – Sociedade Imobiliária, S.A. |
| Adlands B.V. | BHW Beeskow Holzwerkstoffe |
| Aegean Park, S.A. | Bloco Q – Sociedade Imobiliária, S.A. |
| Agepan Eiweiler Management GmbH | Bloco W – Sociedade Imobiliária, S.A. |
| Agepan Flooring Products, S.A.RL | Boavista Shopping Centre BV |
| Agloma Investimentos, Sgps, S.A. | BOM MOMENTO – Comércio Retalhista, SA |
| Agloma-Soc.Ind.Madeiras e Aglom., S.A. | Canasta – Empreendimentos Imobiliários, S.A. |
| Águas Furtadas Sociedade Agrícola, SA | Carnes do Continente – Ind.Distr.Carnes, S.A. |
| Airone – Shopping Center, Srl | Casa Agrícola de Ambrães, S.A. |
| ALBCC Albufeirashopping C.Comercial SA | Casa da Ribeira – Hotelaria e Turismo, S.A. |
| ALEXA Administration GmbH | Cascaishopping – Centro Comercial, S.A. |
| ALEXA Asset GmbH & Co KG | Cascaishopping Holding I, SGPS, S.A. |
| ALEXA Holding GmbH | CCCB Caldas da Rainha - Centro Comercial,SA |
| ALEXA Shopping Centre GmbH | Centro Colombo – Centro Comercial, S.A. |
| Algarveshopping – Centro Comercial, S.A. | Centro Residencial da Maia,Urban., S.A. |
| Alpêssego – Soc. Agrícola, S.A | Centro Vasco da Gama – Centro Comercial, S.A. |
| Andar – Sociedade Imobiliária, S.A. | Change, SGPS, S.A. |
| Aqualuz – Turismo e Lazer, Lda | Chão Verde – Soc.Gestora Imobiliária, S.A. |
| Arat inmebles, S.A. | Cinclus Imobiliária, S.A. |
| ARP Alverca Retail Park,SA | Citorres – Sociedade Imobiliária, S.A. |
| Arrábidashopping – Centro Comercial, S.A. | Coimbrashopping – Centro Comercial, S.A. |
| Aserraderos de Cuellar, S.A. | Colombo Towers Holding, BV |
| Atlantic Ferries – Tráf.Loc,Flu.e Marít, S.A. | Contacto Concessões, SGPS, S.A. |
| Avenida M – 40 B.V. | Contibomba – Comérc.Distr.Combustiveis, S.A. |
| Contimobe – Imobil.Castelo Paiva, S.A. | Glunz UK Holdings Ltd |
|---|---|
| Continente Hipermercados, S.A. | Glunz Uka Gmbh |
| Contry Club da Maia-Imobiliaria, S.A. | GMET, ACE |
| Cooper Gay Swett & Crawford Lt | Golf Time – Golfe e Invest. Turísticos, S.A. |
| Craiova Mall BV | Guimarãeshopping – Centro Comercial, S.A. |
| Cronosaúde – Gestão Hospitalar, S.A. | Harvey Dos Iberica, S.L. |
| Cumulativa – Sociedade Imobiliária, S.A. | Herco Consultoria de Riscos e Corretora de Seguros Ltda |
| Darbo S.A.S | HighDome PCC Limited |
| Deutsche Industrieholz GmbH | Iberian Assets, S.A. |
| Discovery Sports, SA | Igimo – Sociedade Imobiliária, S.A. |
| Dortmund Tower GmbH | Iginha – Sociedade Imobiliária, S.A. |
| Dos Mares – Shopping Centre B.V. | Imoareia – Invest. Turísticos, SGPS, S.A. |
| Dos Mares – Shopping Centre, S.A. | Imobiliária da Cacela, S.A. |
| Ecociclo – Energia e Ambiente, S.A. | Imoclub – Serviços Imobilários, S.A. |
| Ecociclo II | Imoconti – Soc.Imobiliária, S.A. |
| Edições Book.it, S.A. | Imodivor – Sociedade Imobiliária, S.A. |
| Edificios Saudáveis Consultores, S.A. | Imoestrutura – Soc.Imobiliária, S.A. |
| Efanor Investimentos, SGPS, S.A. | Imoferro – Soc.Imobiliária, S.A. |
| Efanor Serviços de Apoio à Gestão, S.A. | Imohotel – Emp.Turist.Imobiliários, S.A. |
| El Rosal Shopping, S.A. | Imomuro – Sociedade Imobiliária, S.A. |
| Emfísico Boavista | Imopenínsula – Sociedade Imobiliária, S.A. |
| Empreend.Imob.Quinta da Azenha, S.A. | Imoplamac Gestão de Imóveis, S.A. |
| Equador & Mendes, Lda | Imoponte – Soc.Imobiliaria, S.A. |
| Espimaia – Sociedade Imobiliária, S.A. | Imoresort – Sociedade Imobiliária, S.A. |
| Estação Viana – Centro Comercial, S.A. | Imoresultado – Soc.Imobiliaria, S.A. |
| Estêvão Neves – Hipermercados Madeira, S.A. | Imosedas – Imobiliária e Seviços, S.A. |
| Euroresinas – Indústrias Quimicas, S.A. | Imosistema – Sociedade Imobiliária, S.A. |
| Farmácia Selecção, S.A. | Imosonae II |
| Fashion Division Canárias, SL | Impaper Europe GmbH & Co. KG |
| Fashion Division, S.A. | Implantação – Imobiliária, S.A. |
| Fozimo – Sociedade Imobiliária, S.A. | Infofield – Informática, S.A. |
| Fozmassimo – Sociedade Imobiliária, S.A. | Infratroia, EM |
| Freccia Rossa – Shopping Centre S.r.l. | Inparsa – Gestão Galeria Comercial, S.A. |
| Frieengineering International Ltda | Inparvi SGPS, S.A. |
| Fundo de Invest. Imobiliário Imosede | Integrum - Energia, SA |
| Fundo I.I. Parque Dom Pedro Shop.Center | Integrum Colombo Energia, S.A. |
| Fundo Invest.Imob.Shopp. Parque D.Pedro | Interlog – SGPS, S.A. |
| Gaiashopping I – Centro Comercial, S.A. | Invesaude - Gestão Hospitalar S.A. |
| Gaiashopping II – Centro Comercial, S.A. | Investalentejo, SGPS, S.A. |
| GHP Gmbh | Ioannina Development of Shopping Centres, SA |
| Gli Orsi Shopping Centre 1 Srl | Isoroy SAS |
| Glunz AG | La Farga – Shopping Center, SL |
| Glunz Service GmbH | Laminate Park GmbH Co. KG |
Cumulativa – Sociedade Imobiliária, S.A. Herco Consultoria de Riscos e Corretora de Seguros Ltda
Larim Corretora de Resseguros Ltda Norteshopping – Centro Comercial, S.A. Larissa Develop. Of Shopping Centers, S.A. Norteshopping Retail and Leisure Centre, BV Lazam – MDS Corretora e Administradora de Seguros, S.A. Nova Equador Internacional,Ag.Viag.T, Ld LCC LeiriaShopping Centro Comercial SA Nova Equador P.C.O. e Eventos Le Terrazze - Shopping Centre 1 Srl Operscut – Operação e Manutenção de Auto-estradas, S.A. Libra Serviços, Lda. OSB Deustchland Gmbh Lidergraf – Artes Gráficas, Lda. PantheonPlaza BV Loop5 Shopping Centre GmbH Paracentro – Gest.de Galerias Com., S.A. Loureshopping – Centro Comercial, S.A. Pareuro, BV Luz del Tajo – Centro Comercial S.A. Park Avenue Develop. of Shop. Centers S.A. Luz del Tajo B.V. Parque Atlântico Shopping – C.C., S.A. Madeirashopping – Centro Comercial, S.A. Parque D. Pedro 1 B.V. Maiashopping – Centro Comercial, S.A. Parque D. Pedro 2 B.V. Maiequipa – Gestão Florestal, S.A. Parque de Famalicão – Empr. Imob., S.A. Marcas do Mundo – Viag. e Turismo Unip, Lda Parque Principado SL Marcas MC, ZRT Pátio Boavista Shopping Ltda. Marina de Tróia S.A. Pátio Campinas Shopping Ltda Marinamagic – Expl.Cent.Lúdicos Marít, Lda Pátio Goiânia Shopping Ltda Marmagno – Expl.Hoteleira Imob., S.A. Pátio Londrina Empreend. e Particip. Ltda Martimope – Sociedade Imobiliária, S.A. Pátio Penha Shopping Ltda. Marvero – Expl.Hoteleira Imob., S.A. Pátio São Bernardo Shopping Ltda MDS Affinity - Sociedade de Mediação, Lda Pátio Sertório Shopping Ltda MDS Assoc. Corretora de Seguros Ltda Pátio Uberlândia Shopping Ltda MDS Consultores, S.A. Peixes do Continente – Ind.Dist.Peixes, S.A. MDS Corretor de Seguros, S.A. Pharmaconcept – Actividades em Saúde, S.A. MDS Malta Holding Limited PHARMACONTINENTE – Saúde e Higiene, S.A. MDS SGPS, SA PJP – Equipamento de Refrigeração, Lda MDSAUTO - Mediação de Seguros, SA Plaza Éboli B.V. Megantic BV Plaza Éboli – Centro Comercial S.A. Miral Administração e Corretagem de Seguros Ltda Plaza Mayor Holding, SGPS, SA MJLF – Empreendimentos Imobiliários, S.A. Plaza Mayor Parque de Ócio BV Mlearning - Mds Knowledge Centre, Unip, Lda Plaza Mayor Parque de Ocio, SA Modalfa – Comércio e Serviços, S.A. Plaza Mayor Shopping BV MODALLOOP – Vestuário e Calçado, S.A. Plaza Mayor Shopping, SA Modelo – Dist.de Mat. de Construção, S.A. Ploi Mall BV Modelo Continente Hipermercados, S.A. Plysorol, BV Modelo Continente Intenational Trade, SA Poliface North America Modelo Hiper Imobiliária, S.A. POLINSUR – Mediação de seguros, LDA Modelo.com – Vendas p/Correspond., S.A. PORTCC - Portimãoshopping Centro Comercial, SA Modus Faciendi - Gestão e Serviços, S.A. Porturbe – Edificios e Urbanizações, S.A. Movelpartes – Comp.para Ind.Mobiliária, S.A. Praedium – Serviços, S.A. Movimento Viagens – Viag. e Turismo U.Lda Praedium II – Imobiliária, S.A. Mundo Vip – Operadores Turisticos, S.A. Praedium SGPS, S.A. Munster Arkaden, BV Predicomercial – Promoção Imobiliária, S.A. Norscut – Concessionária de Scut Interior Norte, S.A. Prédios Privados Imobiliária, S.A.
Predisedas – Predial das Sedas, S.A. Rochester Real Estate, Limited Pridelease Investments, Ltd RSI Corretora de Seguros Ltda Proj. Sierra Germany 4 (four) – Sh.C.GmbH S.C. Microcom Doi Srl Proj.Sierra Germany 2 (two) – Sh.C.GmbH Saúde Atlântica – Gestão Hospitalar, S.A. Proj.Sierra Germany 3 (three) – Sh.C.GmbH SC – Consultadoria, S.A. Proj.Sierra Italy 1 – Shop.Centre Srl SC – Eng. e promoção imobiliária,SGPS, S.A. Proj.Sierra Italy 2 – Dev. Of Sh.C.Srl SC Aegean B.V. Proj.Sierra Italy 3 – Shop. Centre Srl SC Assets SGPS, S.A. Proj.Sierra Italy 5 – Dev. Of Sh.C.Srl SC Finance BV Proj.Sierra Portugal VIII – C.Comerc., S.A. SC Mediterraneum Cosmos B.V. Project 4, Srl SC, SGPS, SA Project SC 1 BV SCS Beheer, BV Project SC 2 BV Selfrio,SGPS, S.A. Project Sierra 2 B.V. Selifa – Empreendimentos Imobiliários, S.A. Project Sierra 6 BV Sempre à Mão – Sociedade Imobiliária, S.A. Project Sierra 8 BV SERENITAS-SOC.MEDIAÇÃO SEG.LDA Project Sierra 9 BV Serra Shopping – Centro Comercial, S.A. Project Sierra Brazil 1 B.V. Sesagest – Proj.Gestão Imobiliária, S.A. Project Sierra Charagionis 1 S.A. Sete e Meio – Invest. Consultadoria, S.A. Project Sierra Four, SA Sete e Meio Herdades – Inv. Agr. e Tur., S.A. Project Sierra Germany Shop. Center 1 BV Shopping Centre Parque Principado B.V. Project Sierra Germany Shop. Center 2 BV Shopping Penha B.V. Project Sierra Spain 1 B.V. Siaf – Soc.Iniciat.Aprov.Florestais - Energia, S.A. Project Sierra Spain 2 – Centro Comer. S.A. SIAL Participações Ltda Project Sierra Spain 2 B.V. Sierra Asset Management – Gest. Activos, S.A. Project Sierra Spain 3 – Centro Comer. S.A. Sierra Berlin Holding BV Project Sierra Spain 3 B.V. Sierra Central S.A.S Project Sierra Spain 6 B.V. Sierra Charagionis Develop.Sh. Centre S.A. Project Sierra Spain 7 – Centro Comer. S.A. Sierra Charagionis Propert.Management S.A. Project Sierra Spain 7 B.V. Sierra Corporate Services Holland, BV Project Sierra Three Srl Sierra Development Greece, S.A. Project Sierra Two Srl Sierra Developments Germany GmbH Promessa Sociedade Imobiliária, S.A. Sierra Developments Holding B.V. Prosa – Produtos e serviços agrícolas, S.A. Sierra Developments Italy S.r.l. Puravida – Viagens e Turismo, S.A. Sierra Developments Romania, Srl Quorum Corretora de seguros LT Sierra Developments Spain – Prom.C.Com.SL Racionaliz. y Manufact.Florestales, S.A. Sierra Developments, SGPS, S.A. RASO - Viagens e Turismo, S.A. Sierra Enplanta Ltda RASO, SGPS, S.A. Sierra European R.R.E. Assets Hold. B.V. Rio Sul – Centro Comercial, S.A. Sierra GP Limited River Plaza Mall, Srl Sierra Investimentos Brasil Ltda River Plaza, BV Sierra Investments (Holland) 1 B.V.
Project Sierra 7 BV Sempre a Postos – Produtos Alimentares e Utilidades, Lda
Sierra Investments (Holland) 2 B.V. Sonae SGPS, S.A. Sierra Investments Holding B.V. Sonae Sierra Brasil S.A. Sierra Investments SGPS, S.A. Sonae Sierra Brazil B.V. Sierra Italy Holding B.V. Sonae Sierra, SGPS, S.A. Sierra Management Germany GmbH Sonae Tafibra Benelux, BV Sierra Management Greece S.A. Sonae Turismo – SGPS, S.A. Sierra Management Italy S.r.l. Sonae UK, Ltd. Sierra Management Romania, Srl Sonaegest – Soc.Gest.Fundos Investimentos Sierra Management Spain – Gestión C.Com.S.A. SONAEMC - Modelo Continente, SGPS, S.A. Sierra Management, SGPS, S.A. Sondis Imobiliária, S.A. Sierra Portugal, S.A. Sontel BV SII – Soberana Invest. Imobiliários, S.A. Sontur BV SIRS – Sociedade Independente de Radiodifusão Sonora, S.A. Sonvecap BV SISTAVAC, S.A. Sopair, S.A. SKK – Central de Distr., S.A. Sotáqua – Soc. de Empreendimentos Turist SKK SRL Spanboard Products, Ltd SKKFOR – Ser. For. e Desen. de Recursos SPF – Sierra Portugal Real Estate, Sarl Sociedade de Construções do Chile, S.A. Spinarq - Engenharia, Energia e Ambiente, SA Société de Tranchage Isoroy S.A.S. Spinveste – Gestão Imobiliária SGII, S.A. Socijofra – Sociedade Imobiliária, S.A. Spinveste – Promoção Imobiliária, S.A. Sociloures – Soc.Imobiliária, S.A. Sport Retalho España – Servicios Gen., S.A. Soconstrução BV Sport Zone – Comércio Art.Desporto, S.A. Sodesa, S.A. Sport Zone – Turquia Soflorin, BV Sport Zone Canárias, SL Soira – Soc.Imobiliária de Ramalde, S.A. Sport Zone España-Com.Art.de Deporte,SA Solinca - Eventos e Catering, SA Spred, SGPS, SA Solinca - Health and Fitness, SA Stinnes Holz GmbH Solinca – Investimentos Turísticos, S.A. Tableros Tradema, S.L. Solinfitness – Club Malaga, S.L. Tafiber,Tableros de Fibras Ibéricas, SL Solingen Shopping Center GmbH Tafibra Polska Sp.z.o.o. Soltroia – Imob.de Urb.Turismo de Tróia, S.A. Tafibra South Africa Somit Imobiliária Tafibra Suisse, SA SONAE - Specialized Retail, SGPS, SA Tafisa – Tableros de Fibras, S.A. Sonae Capital Brasil, Lda Tafisa Canadá Societé en Commandite Sonae Capital,SGPS, S.A. Tafisa France, S.A. Sonae Center II S.A. Tafisa UK, Ltd Sonae Center Serviços, S.A. Taiber,Tableros Aglomerados Ibéricos, SL Sonae Ind., Prod. e Com.Deriv.Madeira, S.A. Tarkett Agepan Laminate Flooring SCS Sonae Indústria – SGPS, S.A. Tecmasa Reciclados de Andalucia, SL Sonae Industria de Revestimentos, S.A. Terra Nossa Corretora de Seguros Ltda Sonae Indústria Manag. Serv, SA Têxtil do Marco, S.A. Sonae Investimentos, SGPS, SA Tlantic Portugal – Sist. de Informação, S.A. Sonae Novobord (PTY) Ltd Tlantic Sistemas de Informação Ltdª Sonae RE, S.A. Todos os Dias – Com.Ret.Expl.C.Comer., S.A.
Sonae Retalho Espana – Servicios Gen., S.A. Tool Gmbh
| Torre Ocidente Imobiliária, S.A. | Vistas do Freixo, SA |
|---|---|
| Torre São Gabriel – Imobiliária, S.A. | Vuelta Omega, S.L. |
| TP – Sociedade Térmica, S.A. | Weiterstadt Shopping BV |
| Troia Market, S.A. | World Trade Center Porto, S.A. |
| Tróia Natura, S.A. | Worten – Equipamento para o Lar, S.A. |
| Troiaresort – Investimentos Turísticos, S.A. | Worten Canárias, SL |
| Troiaverde – Expl.Hoteleira Imob., S.A. | Worten España, S.A. |
| Tulipamar – Expl.Hoteleira Imob., S.A. | ZIPPY - Comércio e Distribuição, SA |
| Unishopping Administradora Ltda. | ZIPPY - Comercio y Distribución, S.A. |
| Unishopping Consultoria Imob. Ltda. | Zippy Turquia |
| Urbisedas – Imobiliária das Sedas, S.A. | Zubiarte Inversiones Inmobiliarias, S.A. |
| Valecenter Srl | ZYEVOLUTION-Invest.Desenv.,SA. |
| Valor N, S.A. | |
| Vastgoed One – Sociedade Imobiliária, S.A. | |
| Vastgoed Sun – Sociedade Imobiliária, S.A. | |
| Via Catarina – Centro Comercial, S.A. | |
| Viajens y Turismo de Geotur España, S.L. |
| FT Group Companies | |
|---|---|
| France Telecom, S.A. | Atlas Services Belgium, S.A. |
This document may contain forward-looking information and statements, based on management's current expectations or beliefs. Forward-looking statements are statements that are not historical facts.
These forward-looking statements are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements, including, but not limited to, changes in regulation, the telecommunications industry and economic conditions; and the effects of competition. Forward-looking statements may be identified by words such as "believes", "expects", "anticipates", "projects", "intends", "should", "seeks", "estimates", "future" or similar expressions.
. Although these statements reflect our current expectations, which we believe are reasonable, investors, analysts and, generally, the recipients of this document are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond our control, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements. You are cautioned not to put undue reliance on any forward-looking information or statements. We do not undertake any obligation to update any forward-looking information or statements.
Report available in Sonaecom's institutional website www.sonae.com
Media and Investor Contacts
Isabel Borgas Public Relations Manager [email protected] Tel: +351 93 100 20 20
Carlos Alberto Silva Investor Relations Manager [email protected] Tel: +351 93 100 24 44
Sonaecom SGPS, SA Rua Henrique Pousão, 432 – 7th floor 4460-841 Senhora da Hora Portugal
Sonaecom SGPS is listed on the Euronext Stock Exchange. Information is available on Reuters under the symbol "SNC.LS" and on Bloomberg under the symbol "SNC:PL".
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