Annual Report • Apr 30, 2015
Annual Report
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| I. | MANAGEMENT REPORT ON BUSINESS IN 2014 2 | |
|---|---|---|
| 1. | GENERAL INFORMATION 3 | |
| FINANCIAL HIGHLIGHTS 3 a) |
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| ADDRESS TO SHAREHOLDERS: MARINKO DOŠEN, PRESIDENT OF THE BOARD 4 b) |
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| ORGANIZATION PROFILE 5 c) |
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| d) MANAGING IN AD PLASTIK GROUP 5 | ||
| e) STRUCTURE OF AD PLASTIK GROUP 6 | ||
| f) OWNERSHIP STRUCTURE 7 | ||
| INFORMATION ON THE SHARE ADPL-R-A 8 f) |
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| h) DECLARATION ON THE IMPLEMENTATION OF CORPORATE GOVERNANCE CODE 10 | ||
| 2) REVIEW OF OPERATIONS IN 2014 AND THE DEVELOPMENT PLAN OF AD PLASTIK GROUP 11 | ||
| a) BUSINESS OVERVIEW IN 2014 11 | ||
| b) FINANCIAL REPORTS OF AD PLASTIK GROUP WITH CONSOLIDATED FINANCIAL STATEMENTS OF AFFILIATED COMPANIES EURO APS AND FADP 14 |
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| c) FINANCIAL RATIOS 15 | ||
| d) MARKET AND EXPECTED DEVELOPMENT OF AD PLASTIK GROUP 16 | ||
| e) EMPLOYEES 17 | ||
| f) ENVIRONMENT AND CORPORATE SOCIAL RESPONSIBILITY 18 | ||
| g) THE MOST SIGNIFICANT CHANGES IN THE BALANCE SHEET POSITIONS OF AD PLASTIK GROUP 19 |
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| II. STATEMENT OF PERSONS RESPONSIBLE FOR THE PREPARATION OF ANNUAL REPORTS 20 | ||
| III.AUDITED REPORTS 21 | ||
| IV.DECISION PROPOSAL FOR DECISION ON ANNUAL FINANCIAL STATEMENTS ADOPTION59 V.DECISION PROPOSAL ABOUT USAGE OF NET INCOME 60 |
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| VI. ADDRESS BOOK 61 |
Image 1. Sales revenue of AD Plastik Group for the 2009-2014 and average growth rate of revenues (in mil.of HRK)
Image 3. Earnings per share and dividend per share for period 2009-2014 (in HRK)
Image 5.CAPEX & EBITDA from 2006. to 2014. (in mil. HRK)
Image 6. Capital expenditures (CAPEX) and depreciation of AD Plastik Group since 2010- 2014 (in mil.of HRK)
It is my honor and pleasure to address you as as the new President of the Board of AD Plastik, which is a great responsibility, but also a great business challenge. After six years of consecutive decline in car sales in the European Union, which represents the largest market for AD Plastik Group, finally occured the market stabilization and the achieved sales growth in EU in the amount of 5,6% in 2014.
The stabilization of the European market, unfortunately, is not accompanied by a stabilization of the Russian market, on which certain geopolitical events have caused considerable disruptions, which directly affected the business of our plants in Russia.
Objective market conditions in Russia have resulted in a significant reduction in car sales in general and resulted in weakening of Russian ruble exchange rate, which is why the results of the Group for the previous year are far below expected ones. On the other side, running in and start of serial production for Renault Twingo, Smart 2S and Smart 4S, that is three vehicles from the project Edison, have marked the operations of the parent company and our plant in Mladenovac in the previous year. A successful start of sales of mentioned car models in the market has generated the growth of production in Croatia and therefore the increase in sales revenues at the level of ADP Group. Late last year, most of the development projects in which we have invested run in, and according to our expectations this will lead to an increase in revenue and profit this year compared to the previous year. Due to the current situation in Russia a certain number of companies has left Russia, including the part of our competitors, which has opened up the opportunity to increase our market share and gain new customers. Future development is expected through an organic expansion, which is continued through the primary revenue growth of more than 25% on the Croatian market, while at the level of the Group we expect a revenue growth of 12% in the current year. Our expectations are ambitious, but I am convinced that they are also justified because the serial production of the components for Edison project vehicles and the market growth in the European Union are a sufficient generator of growth in revenue and profit in the following year. We expect that this will be a year of positive steps forward, and return on investment we had over the last two and a half years.
I am convinced that we will welcome the end of the current year with successfully achieved objectives, the planned revenue growth and profitability, which will strengthen the position of AD Plastik on the existing and open opportunities in new markets. Realizing the goals set we will not only contribute to further growth and development of our company, but above all, to the satisfaction of our customers, shareholders and employees.
In addition to this, this year we shall pay special attention to the development and implementation of the strategy of corporate social responsibility and communication with all our stakeholders in order to improve their satisfaction.
Sincerely,
Marinko Došen, President of the Board
AD Plastik Inc. is the largest Croatian manufacturer for automotive plastic components. The company was founded in 1992, by separating from the former Jugoplastika, and in 1996 is formed as a Inc., under the current name. It was privatized in 2001, on the basis of so called employee share ownership program, which has been successfully realized. Therefore, today the employees of AD Plastik are the owners of almost a fifth of the shares of their company.
The activity of AD Plastik in Croatia is the production of plastic components for interiors and exteriors of automobiles. The production in Croatia takes place at locations in Solin, the headquarter and the development center, and in Zagreb, Jankomir. Apart from production in Croatia, the company has plants organized as companies, with the status of legal person, in Serbia, three plants in Russia (near Samara, Saint Petersburg and in Kaluga), in Slovenia and Romania.
The largest buyers whith who AD Plastik and other members of the Group successfully develop long-term business cooperation are Renault, Nissan, PSA, Ford, Opel, VW, Dacia, Daimler, VAZ, Daewoo, Fiat, Mitsubishi.
Within parent company act the following bodies: the General Assembly, the Supervisory Board and the Managment Board.
The work of General Assembly is regulated by Companies Act, Company Statute and Rules of Procedure of General Assembly. At the General Assembly have the right to participate the shareholders who apply to participate in the General Assembly, no later than six days before the meeting in written form to the Legal Services of the Company or to the public notary whose official seat corresponds to the Company's headquarters. The shareholders who apply must also submit evidence in written form of owning shares on the 21 (twentyfirst) day before the meeting of General Assembly issued by the Central Depository and Clearing Company.
The right to participate in the General Assembly have representatives and proxies of shareholders which applied for their participation in accordance with previously mentioned conditions.
The Supervisory Board is responsible for appointing and removing Board members, and for supervising the businesses of the Company in accordance with Companies Act, Company Statute and Rules of Procedure of the Supervisory Board of the Company. In accordance with the Provisions of the Company Statute, the Supervisory Board consists of seven members.
However, during the reporting year the representative of Works Council was not elected as a member of Supervisory Board, so during the whole 2013, the Supervisory Board had six members, with term of office until:
Josip Boban, the Chairman, 19.07.2016.
Nikola Zovko, deputy of Chairman, 19.07.2016.
Marijo Grgurinović, member, 14.07.2015. Dmitrij Leonidovič Drandin, member, 19.10.2015.
Nadezhda Anatolyevna Nikitina, member, 19.10.2015.
Igor Antoljevič Solomatin, member, 14.07.2015.
The Supervisory Board established Appointment Committee, Remuneration Committee and Audit Committee. The members of Appointment Committee are: Nikola Zovko,economist, Chairman Dmitrij Leonidovič Drandin,economist Nenad Škomrlj, jurist
Members of Audit Committee are: Nikola Zovko,economist, Chairman Nenad Škomrlj,jurist, deputy of Chairman Anatolij Janovskis, economist Dmitrij Leonidovič Drandin, economist
Member of Remuneration Committee are: Ana Luketin,jurist, Chairman Dmitrij Leonidovič Drandin,economist Nikola Zovko, economist
The Management Board
The members of the Board and its Chairman are appointed and removed by the Supervisory Board. Their term of office lasts up to five years after which they can be reappointed.
On 31.12.2014 the Board consisted of five members: Mr. Mladen Peroš, Chairman of the Board, Mrs. Katija Klepo, member of the Board for Finance and Accounting, Mr. Ivica Tolić, member of the Board for legal affairs and corporate communications, Mr. Denis Fusek, member of the Board for Business organization, Informatics and Kontrolling, and Mr.Hrvoje Jurišić, as member of the Board for Development.
Changes in the Management since February 2015
On 5th of February 2015 Marinko Došen was appointed as President of the Board, while Mladen Peroš was appointed as Board Member for Development and Commercial affairs. Hrvoje Jurišić was appointed as Board Member for Production and Logistics.
Term of office of all the members of the Board lasts until 19th of July 2016.
Subsidiaries and affiliated companies
The bodies of subsidiaries and affiliated companies are: The Assembly; The Supervisory Board; General Manager. Bodies of subsidiaries and affiliated companies are established and act in accordance with the laws of the state in whose territory is the headquarter of company in question, pursuant to the basic laws of these societies.
Information on the structure of AD Plastik Group is shown in the following image.
The equity capital of AD Plastik Inc. amounts to 419.958.400,00 HRK, and it is divided in 4.199.584 shares of the nominal value of 100,00 HRK.
The shareholders are legal and natural persons from Croatia and abroad, that realize their interests through General Assembly and Supervisory Board in accordance with the legislation of the Republic of Croatia.
| S.N. | Owner | Number of shares |
Percent of ownership |
|---|---|---|---|
| 1. | OAO HOLDING AUTOKOMPONENTI | 1.259.875 | 30,00% |
| 2. | HYPO ALPE-ADRIA-BANK D.D./ RAIFFEISEN OBVEZNI MIROVINSKI FOND KATEGORIJE B |
269.462 | 6,42% |
| 3. | ADP-ESOP D.O.O. | 212.776 | 5,07% |
| 4. | PBZ D.D./STATE STREET CLIENT ACCOUNT | 120.892 | 2,88% |
| 5. | HYPO ALPE-ADRIA-BANK D.D./ PBZ CROATIA OSIGURANJE OBVEZNI MIROVINSKI FOND KATEGORIJE B |
119.640 | 2,85% |
| 6. | SOCIETE GENERALE-SPLITSKA BANKA D.D./ ERSTE PLAVI OBVEZNI MIROVINSKI FOND KATEGORIJE B |
115.353 | 2,75% |
| 7. | HRVATSKA POŠTANSKA BANKA D.D./ KAPITALNI FOND D.D. | 111.541 | 2,66% |
| 8. | ERSTE & STEIERMARKISCHE BANK D.D./ZBIRNI SKRBNIČKI RAČUN ZA STRANU PRAVNU OSOBU |
110.349 | 2,63% |
| 9. | SOCIETE GENERALE-SPLITSKA BANKA D.D./ AZ OMF KATEGORIJE B | 93.900 | 2,24% |
| 10. | ZAGREBAČKA BANKA D.D./STATE STREET BANK AND TRUST COMPANY, BOSTON |
80.207 | 1,91% |
| 11 | OTHERS | 1.705.589 | 40,61% |
Table 1.Ownership structure of AD Plastik Inc. on 31.12 2014.
During 2014 the company disposed 6.000 shares. On 31.12.2014 the company had 31.762 of its own shares, which makes 0,756% of the company capital.
Shares are listed on the Official Market of the Zagreb Stock Exchange. Stock ticker is ADPL-R-A.
In March 2012 AD Plastik Inc. and Erste Bank have signed the Agreement on Market Making. In May 2013 AD Plastik Inc. and Interkapital vrijednosni papiri have also signed the Agreement on Market Making.
Image 8. Movement of average daily stock price ADPL-R-A and Crobex since 01.01.2013 – 31.12.2014.
Source: ZSE
The total turnover achieved by share trading of AD Plastik Inc. in 2014 amounted to 123.978.180 HRK, while the turnover for 2013 amounted to 91.478.496 HRK. Out of all shares listed on the Zagreb Stock Exchange, the share ADPL-R-A was ranked seventh by achieved turnover in 2014.
In 2012 the Company paid the dividend in the amount of 8,00 HRK per one share, out of that 4,00 HRK per share was paid in february, and a difference of 4,00 HRK was paid in August.
Announcement of results for the I quarter of 2015: 30.04.2015
The General Assembly of AD Plastik Inc.will be held: on 24.07.2015
Announcement of results for the first half of 2015:on 30.07.2015
Announcement of results for the III quarter and first nine months of 2015: on 30.10.2015
Announcement of results for the IV quarter and twelve months of 2015: on 14.02.2016
Note: Data from financial calendar are subject to change.
Stjepan Laća, Corporate Communications Manager, phone: 021/206-401, fax: 021/275-401,
e-mail: [email protected]
Ad Plastik Inc. Solin (hereinafter: the Company) applies the Corporate Governance Code, which was written by the Croatian Agency for Supervision of Financial Services (hereinafter: Hanfa) and the Zagreb Stock Exchange Inc. Zagreb, and it was adopted by the decision of Hanfa on April 26th, 2008 and published in the Official Gazette of the Republic of Croatia no. 46/07, as well as on the website of the Zagreb Stock Exchange (hereinafter: the Code).
In 2013 the Company complied with the provisions of the Code, with certain exceptions, occurred primarily because of the process of coordinating practices of the Company with the rules of the Code.
Deviations from the Code were the following:
● Information on all earnings and compensation which a member of the Board receives from the Company are summary published as part of the Annual Report of the Company.
● The Company did not adopt the Statement on the remuneration policy for the Management Board and Supervisory Board
Description of certain deviations from the Code and reasons for the stated deviations the Company explains in detail in the answers to the annual questionnaire that makes an integral part of the Code and which has been delivered and published on the websites of the Zagreb Stock Exchange, as well as on the Company's own website.
Internal supervision in the Company is conducted by the Controlling department which informs the Management Board through the report on the conducted monitoring (findings and suggestions of improvement).
Supervision and coordination of Management business reporting on business results include:
● encouraging communication between the functions of the Company, and coordination with the preparation of report and analysis of business results;
● evaluating the overall business efficiency, and proposing guidelines for improvement;
● giving orders and determination of preventive and corrective activities,
● forecasting the impact of external and internal changes in the overall business of the Company.
In 2013 was establihsed the Internal Audit Service, whose activities began in 2013.
The Company has no majority owner. The largest shareholder is the Open joint stock company, OAO "Holding Autokomponenti" from Saint Petersburg, Russian Federation, which owns 1.259.875 shares which represents 30% of the equity capital of the Company.
During 2013 there were no significant changes in the ownership structure. The ownership structure is presented within this Report, under point I.1.f. in the table 1.
In 2014 AD Plastik Group (hereinfter: ADP Group) recorded an increase in sales revenue of 6,4%, compared to the previous year due to the sales growth in Croatia.
A large investment cycle which began in 2012 was completed in late 2014 by the handover of development projects to the serial production.
The main reasons because of which in 2014 the profitability did not increase compared to the year 2013 are the following:
A successful start of sales of new models of automobiles on the market has generated the growth of production in Croatia and therefore the increase in sales revenues at the level of ADP Group. This is evident from the dynamics of sales revenue growth per quarter in 2014 as shown in image 1. If we compare the revenues of the first and last quarter of the reporting year an increase in sales revenue of more than 50% is recorded.
Image 9. Sales revenue for ADP Group without associated companies EAPS and FADP in 2014 per quarters in (000) HRK
In 2015 we expect a further revenue growth for ADP Group of at least 12% despite predictions of a further decline in new car sales in Russia. Moreover, we expect a revenue increase in Croatia more than 25%. According to the above mentioned information we also expect an increase in profitability/EBITDA margin of at least 9%.
Credit indebtedness of AD Plastik Group at the end of the reporting year amounted to 493 million HRK which represents a reduction in loan liabilities of 17,6 milion HRK compared to the end of third quarter. With regard to the completion of a significant investment cycle in 2014 we expect to reduce loan liabilities by the end of 2015. We plan to reduce the indicator net financial debt/ EBITDA of the Group with the consolidation of the corresponding part of ownership of EAPS and FADP from the level of 3,35 at the end of 2014 to less than 2,8 in 2015. Also, we are negotiating with the banks in order to continue the process of
refinancing the part of short-term loans to convert them into long-term loans.
The serial production of all three vehicles for the project Edison (Renault Twingo, Daimler Smart 2S and 4S) started during 2014. Furthermore, the company started with the serial production regarding projects for the customers Hella, PSA, Ford, VW and Webasto (BMW). These projects ensure a high capacity utilization for the plants in Croatia.
In the parent company was recorded an increase in sales revenue of 13,9% in the reporting year compared to the previous year.
According to the decision of the Ministry of Economy, based on realized investments in Croatia for the project Edison, it is planned the use of reduced rate of income tax (from 20% to 0%).
In the final audit report was made an impairment of a part of financial investments in ADP Kaluga for the amount of 36,8 million HRK.
In the reporting period compared to 2013 ADP Mladenovac recorded an increase of operating revenue of 42,0% that is 44,9 milion HRK.
The serial production of headliners for the project Edison and grab handels for Fiat, Italy started in 2014. The realization of grab handles project for the customers Renault and Fiat/Chrysler for several vehicles and locations is in process.
The company increased the volume of deliveries of raw material for the production of carpets for our plants PHR in Russia and EAPS in Romania.
In the fourth quarter was made a deal for the production of blow molded products for the customer Fiat, Polland; the start of serial production is planned for the third quarter of 2015. The expected revenue from this deal amounts to approximately 2,4 milion EUR during the complete duration of this project.
Furthermore, new deals for Alfa Romeo and Maserati were made. The expected revenue from this deal amounts to approximately 7 milion EUR during the complete duration of this project; the start of serial production is planned for the first quarter of 2016.
Annual report 2014
ZAO PHR (ADP Togliatti) & ADP Kaluga
In 2013 operating revenues of the company PHR amounted to 238 milion HRK, which represents a decrease of 13% compared to the previous year. Due to market disturbances and economic situation in Russia the planned increase in sales in 2014 was not achieved which resulted in 25% lower revenues than planned and in unused capacities.
In 2014 occurred a significant depreciation of the Russian ruble by 50% that is by 37% in the last quarter only which negatively affected the business of Russian plants.
In order to be protected from exchange rate volatility and negative impact on business the following measures were taken:
Monthly changes of prices were agreed with the customers in December (before on a quarterly basis)
Revaluation of fixed assets was performed
Intensified activities on localization of raw materials
The total realized operating revenues of the company ADP Kaluga in the reporting year amounted to 98,9 milion HRK, which represents an increase of 26.78% compared to the previous year, despite the aforementioned market disturbances.
In the reporting year was realized a growth of operating revenues, compared to the previous year, in the amount of 1,72% that is 810 milion HRK.
In the reporting period was achieved a stabile production and a growth in sales compared to the prevoius year as the result of an increase in serial deliveries of the models Sandero and Duster and an increase in delivered quantities for Morocco, Algeria, Iran and other markets.
In the reporting year was recorded a decrease of operating revenues of 30% compared to the prevoius year. The main reason is the decrease of volumes of the current model Ford Focus. The activities of plant preparation for the acceptance of new projects (interior positions for the vehicles Ford Fiesta an Ecosport, and Nissan X-trail) are in process.
With the aim of getting a clearer picture of bussines of AD Plastik Group, we prepared abbreviated financial reports of AD Plastik Group with consolidated financial statements of associated companies Euro APS and FADP for 2012 and 2013, in which AD Plastik has 50%, that is 40 % of ownership.
In these abbreviated financial reports, further in this Report, Euro APS and FADP are consolidated on the basis of the belonging ownership share which AD Plastik has in this company.
Table 2. Profit and loss account of AD Plastik Group with consolidation of belonging ownership share in Euro APS and FADP for 2013 and 2014 in thousands of HRK
| ADP Group with | ADP Group with | |
|---|---|---|
| Positions | consolidation of belonging | consolidation of belonging |
| part of ownership in | part of ownership in | |
| EURO APS and FADP | EURO APS and FADP | |
| 2013. | 2014. | |
| OPERATING REVENUES | 1.369.868 | 1.394.929 |
| Sales revenue | 1.334.867 | 1.357.826 |
| Other revenues | 35.001 | 37.103 |
| OPERATING EXPENSES | 1.289.131 | 1.347.610 |
| Material expenses | 776.217 | 825.285 |
| Staff costs | 214.224 | 225.203 |
| Amortization | 68.450 | 75.761 |
| Other expenses | 230.241 | 221.361 |
| FINANCIAL REVENUES | 15.749 | 33.491 |
| FINANCIAL EXPENSES | 61.654 | 69.091 |
| TOTAL REVENUE | 1.385.618 | 1.428.420 |
| TOTAL EXPENSES | 1.350.785 | 1.416.203 |
| Profit before taxation | 34.833 | 12.218 |
| Profit tax | 7.181 | 7.301 |
| PROFIT FOR THE PERIOD | 27.652 | 4.917 |
As can be seen from Table 2, operating revenue of AD Plastik Group with consolidated belonging ownership share in Euro APS and FADP recorded an increase in 1,8% % compared to the previous year and in total they amounted to 1,39 billion HRK.
Total loan liabilities of AD Plastik Group with the belonging ownership share in Euro APS and FADP are equal to the total loan liabilities of AD Plastik Group without consolidation of affiliated companies.
The affiliated companies do not have financial loan liabilites towards external subjects, except for the loan liabilities towards the owners (that is Faurecia and AD Plastik).
| Table 3. Balance sheet of AD Plastik Group with consolidation of financial reports of belonging |
|---|
| part of ownership in Euro APS and FADP for 2013 and 2014 in thousands of HRK |
| ADP Group with | ADP Group with | ||||
|---|---|---|---|---|---|
| consolidation of | consolidation of | ||||
| belonging part of | belonging part of | ||||
| A/P | Code | Positions | ownership in EURO APS | ownership in EURO | |
| and FADP | APS and FADP | ||||
| 2013. | 2014 | ||||
| A. | Fixed assets | 934.158 | 1.023.017 | ||
| B. | Current assets | 522.881 | 568.989 | ||
| ASSETS | C. | Prepayment & accrued inc. | 186.394 | 90.394 | |
| A+B+C | TOTAL ASSETS | 1.643.433 | 1.682.399 | ||
| A. | Capital and Reserves | 692.306 | 626.554 | ||
| B. | Long-term liabilities | 285.234 | 222.335 | ||
| C. | Provisions | 8.074 | 9.769 | ||
| D. | Short-term liabilities | 600.097 | 806.740 | ||
| LIABILITIES | E. | Deferred pay. Of costs & future inc. | 57.722 | 17.001 | |
| F(A+E) | TOTAL LIABILITIES | 1.643.433 | 1.682.399 |
Below we are presenting the calculation of selected financial ratios for AD Plastik Group with consolidation of belonging part of ownership in Euro APS and FADP for AD Plastik Group without consolidation of affiliated companies.
From the consolidated statement is evident that EBITDA (Earnings before interest, taxes, depreciation and amortization) in 2014 compared to the 2013 for AD Plastik Group with consolidation of belonging part of ownership in Euro APS and FADP was minimally corrected for 17,5% and it amounts to 123,1 milion HRK, in contrast to 156,05 milion HRK which was the amount in 2012.
The main reason for decrease in EBITDA is a decrease in EBITDA of ADP Group.
| ADP Group with consolidation of belonging part of Indicator ownership in EURO APS and FADP 2014. 1.394.929 411.966 123.080 0,24 2,74 |
AD Plastik Group - | |
|---|---|---|
| without consolidation of | ||
| associated companies | ||
| 2014. | ||
| Business revenues | 899.864 | |
| Net financial debt | 476.066 | |
| EBITDA (earnings before interest and | ||
| taxes, depreciation and amortization) | 52.926 | |
| Price (share price)/Sales (revenue) | 0,37 | |
| Price (share price)/EBITDA | 6,37 | |
| Net financial debt/EBITDA | 3,35 | 8,99 |
Table 4. Financial ratios of AD Plastik Group in 2014 in thousands of HRK
Note: For the calculation of share prices we used an average price of ADPL-R-A on 31.03.2015
After year 2013 during which European sales decreased by – 1,7%, analysts were expecting slight improvement for 2014. Due to new models launched and marketing operations from many OEMs, sales increased globally by 5 % in Western Europe in 2014.
This global performance was not impacting all European countries in the same way, big variations could be observed from one country to the other, even German brands were affected by certain instability.
In the meantime Russian market, due to different reasons collapsed and global car sales dropped down by – 10 % in 2014. A particularly large impact on the market had a decrease of value of the Russian ruble against the EUR, more specially during 2nd half of the year, severely impacting profitability at the same time AD Plastik was launching a large number of new products.
Year 2014 has been important year for AD Plastik with launch of new Renault-Daimler
platform replacing both Twingo and Smart (for 2 & for 4), for which content was huge, with all exterior painted parts, all major interior parts (instrument panel, door panels & headliners) and some technical parts (cooling system support). It was the way to develop new relationships with Daimler as a customer and this also ensured the additional deliveries of painted products for the vehicle Citan in Maubeuge and getting CCC certificates necessary for the commercialization of products in China
Acquisition of grab handle orders from Renault & Fiat reinforced AD Plastik position on this product range and will open new challenges with deliveries to Chrysler in USA and Renault in Asia. Additional possibilities are still on going with VW group on similar products.
FCA (Fiat Chrysler Automotive) is now a key customer for AD Plastik, who is delivering 7 of their plants and recently got new order from Maserati.
At the same time, AD Plastik has been nominated by Ford as a development supplier for wheel arch liners for C platform (Mondeo).
Production of extruded weather strips for VW Golf after the initial 20%, will achieve 80% of total volumes in Q3/2015.
More than ever, customer portfolio diversification is key for the future development of AD Plastik activities, with special focus on German market and opportunities to get orders from LCV brands. Sales in Europe in first quarter of 2015 are showing positive trend and expectations from analysts for global 2015 are around + 3% compared with 2014.
Car sales in the Russian market, despite the strengthening and stabilization of ruble,is not recovering and some OEMs have announced temporary production stoppage; in these conditions analysts forecast – 25 % in Russia. Activities are taking place to adapt to new market conditions with efficient use and optimization of installed capacities and continuous improvements of business processes.
During the previous year we employed the employess belonging to the different structure - from professional staff to direct production employees which account for the largest number. On 31.12.2014 AD Plastik Inc. had 1283 employees in its two plants, located Solin and Zagreb, and the average age of employees was 39.90 years.
Image 15. Structure of education of employees on 31.12.2014.
Although during the process of employment it is important to consider knowledge and skills to perform the job, we also take into account the fitting of the candidates into the organizational culture.
We continue with the trend of investing in our employess through various processes from introduction to work to mentorships, as well as targeted trainings to raise the competences and to acquire the professional, managerial knowledge and skills applicable in the automotive industry. The topics are specific, that is adjusted to tthe plant and the expressed needs.
The aforementioned is also supported by the annual testing of the working climate which has shown that the employees are mostly satisfied with the competence of their immediate superiors and colleagues which confirms that the company has quality staff which is able to cope with business
challenges. Fluctuation rate is still low and for 2014 amounts to 0,74%.
By an applicable collective agreement, employment rules and firm adherence to regulations we guarantee respect for labor rights and freedom of association.
Preservation and protection of the environment is an inevitable part of business policy of AD Plastik Group. Functioning according to the principles of environmental protection and sustainable development is our permanent commitment and obligation.
Care for environment is the result of coordinated activities of all business processes in the company.Compliance with legal regulations and other mandatory requirements are continuously monitored and supervised.
During 2014, we updated operational emergency plans in case of a sudden water pollution, Regulations about treatment of all types of waste from technological process and sludge from wastewater treatment processes, Rules of procedure and maintenance of facilities for discharge and pre-treatment of waste water. Also, on location Solin test on tightness of fuel oil tank was conducted and new water permit was approved from authorities. Location Zagreb was connected to the public sewerage system, and in May we obtained Solution on the work of the plant below the limit indicators. All planned testing of emissions to air and water have been conducted and all were in compliance with applicable regulations, also reports on environmental emissions were submitted to the competent authorities. In the previous period there weren`t any sudden harmful emissions into the environment.
In the reporting period, our employees were trained in the field of environmental protection. As part of the educational program they participated in the TAIEX seminar "for the CLP-mixtures practical application"
organized by the Association for the chemical industry.
AD Plastik Group has a fundamental policy against corruption (Code of Business Conduct), during the reporting period no objections to the violatin of the Code have been received. In the previous year AD Plastik has performed the education of middle and senior management on the subject of Anti-bribery and corruption measures, within which was shown a desirable behavior in problematic situations demonstrated by use of practical examples.
In October last year AD Plastik Inc. received an award from Renault for outstanding contribution in the field of corporate social responsibility.
This year AD Plastik Group will publish a Sustainable Business Report for 2013 and 2014 within which socially responsible activities will be described in more detail.
In the Group`s balance sheet positions relative to December 31st, 2013 the greatest changes were recorded in these positions:
institutions (decrease of 37,1 milion HRK and increase of 37,1 milion HRK) – due to the obligation in accordance with IAS to transfer all the long–term liabilites maturing in the next year into the short-term liabilites;
Results of affiliated companies EAPS Romania and FADP Holding France are included in the Group result under the equity method.
Gross salary paid to the auditor for conducted audit of financial reports in 2014 amounted to 603.416 HRK.
According to the best of my knowledge:
Accounting Department Manager Board Member for Finances and
Marica Jakelić Katija Klepo
Accounting
AD Plastik d.d., Solin and its subsidiaries Consolidated financial statements and Independent Auditor's Report For the year ended 31 December 2014
| Responsibility for the financial statements | 1 |
|---|---|
| Independent Auditor's Report | 2-3 |
| Consolidated statement of comprehensive income | 4-5 |
| Consolidated statement of financial position | 6-7 |
| Consolidated statement of changes in shareholders' equity | 8-9 |
| Consolidated statement of cash flows | 10 |
| Notes to the consolidated financial statements | 11-60 |
Pursuant to the Croatian Accounting Act, the Management Board is responsible for ensuring that financial statements are prepared for each financial year in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union, which give a true and fair view of the state of affairs and results of AD Plastik d.d. ("the Company") and subsidiaries ("the Group") for that period.
After making enquiries, the Board has a reasonable expectation that the Company and the Group have adequate resources to continue in operational existence for the foreseeable future. For this reason, the Board continues to adopt the going concern basis in preparing the financial.
In preparing those financial statements, the responsibilities of the Board include ensuring that:
The Board is responsible for keeping proper accounting records, which disclose with reasonable accuracy at any time the financial position of the Company and the Group, and must also, ensure that the financial statements comply with the Croatian Accounting Act. The Board is also responsible for safeguarding the assets of the Company and the Group, and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities
Signed on behalf of the Management by:
Marinko Došen President of the Management Board AD PLASTIK d.d. Matoševa 8 21210 Solin
Republic of Croatia
23 April 2015
We have audited the accompanying financial statements of AD Plastik d.d., Solin ("the Company") and subsidiaries ("the Group") which comprise the balance sheet as at 31 December 2014, and the income statement for the year than ended, statement of changes in equity and statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes.
Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards adopted by European Union, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
| 2014 | 2013 | ||
|---|---|---|---|
| Notes | |||
| Sales | 6 | 869,553 | 817,591 |
| Other income | 7 | 27,924 ____ |
18,180 ____ |
| Total income | 897,477 ____ |
835,771 ____ |
|
| Increase in the value of work in progress and finished products | 4,893 | 7,195 | |
| Cost of raw material and supplies | 8 | (434,918) | (377,099) |
| Cost of goods sold | 9 | (36,227) | (32,244) |
| Service costs | 12 | (66,209) | (54,819) |
| Staff costs | 10 | (182,196) | (165,658) |
| Depreciation and amortization | 11 | (58,990) | (50,370) |
| Other external expenses | 13 | (116,976) | (131,128) |
| Other operating expenses | 14 | (9,496) | (6,487) |
| Provisions for risks and charges | 15 | (3,420) ____ |
(3,952) ____ |
| Total operating expenses | (903,539) ____ |
(814,562) ____ |
|
| Profit from operations | (6,062) ____ |
21,209 ____ |
|
| Financial income | 16 | 41,403 | 24,049 |
| Financial expenses | 17 | (63,179) | (58,560) |
| Equity income | 18 | 32,899 ____ |
41,708 ____ |
| Net profit from financial activities | 11,123 ____ |
7,197 ____ |
|
| Profit before taxation | 5,061 ____ |
28,406 ____ |
|
| Income tax expense | 19 | (144) ____ |
(754) ____ |
| Profit for the year | 4,917 ____ |
27,652 ____ |
| Other comprehensive income | |||
|---|---|---|---|
| Exchange differences on translating foreign operations after income tax |
(95,144) | - | |
| Reserves from the revaluation of tangible fixed assets | 62,714 | - | |
| Net other comprehensive income | 20 | (32,430) | - |
| Total comprehensive income | (27,513) | 27,652 | |
| Profit attributable to: | |||
| Equity holders of the Company | 4,930 | 27,661 | |
| Non-controlling interests | (13) | (9) | |
| Total comprehensive income attributable to: | |||
| Equity holders of the Company | (27,495) | 27,661 | |
| Non-controlling interests | (18) | (9) | |
| Basic and diluted earnings per share | 21 | 1.18 | 6.64 |
| Notes | 31.12.2014 | 31.12.2013 | |
|---|---|---|---|
| ASSETS | |||
| Non-current assets | |||
| Intangible assets | 22 | 152,138 | 121,104 |
| Tangible assets | 23 | 755,636 | 711,217 |
| Investments in associates | 24 | 92,666 | 101,012 |
| Other financial assets | 25 | 52,626 | 54,334 |
| Long-term receivables | 8,459 | - | |
| Deferred tax assets | 19 | 13,650 ____ |
1,992 ____ |
| Total non-current assets | 1,075,175 ____ |
989,659 ____ |
|
| Current assets | |||
| Inventories | 26 | 94,315 | 94,793 |
| Trade receivables | 27 | 207,409 | 148,435 |
| Other receivables | 28 | 48,528 | 62,554 |
| Current financial assets | 29 | 15,539 | 27,144 |
| Cash | 30 | 7,806 | 28,943 |
| Prepaid expenses and accrued income | 31 | 85,289 ____ |
184,903 ____ |
| Total current assets | 458,886 ____ |
546,772 ____ |
|
| TOTAL ASSETS | 1,534,061 ____ |
1,536,431 ____ |
| Notes | 31.12.2014 | 31.12.2013 | |
|---|---|---|---|
| Equity | |||
| Share capital | 32 | 419,958 | 419,958 |
| Reserves | 193,353 | 223,890 | |
| Retained earnings | 12,398 | 31,288 | |
| Profit for the year | 4,930 | 27,661 | |
| Non-controlling interests | (7) ____ |
9 ____ |
|
| Total equity | 630,632 ____ |
702,806 ____ |
|
| Long-term provisions | 33 | 1,990 | 2,652 |
| Long-term borrowings | 34 | 212,344 | 255,816 |
| Other non-current liabilities | 34 | 26,239 ____ |
226 ____ |
| Total non-current liabilities | 240,573 ____ |
258,694 ____ |
|
| Advances received | 35 | 57,224 | 94,660 |
| Trade payables | 36 | 270,425 | 156,085 |
| Short-term borrowings | 37 | 285,343 | 239,963 |
| Other current liabilities | 38 | 28,588 | 20,611 |
| Short-term provisions | 33 | 7,606 | 7,581 |
| Accrued expenses and deferred income | 39 | 13,670 ____ |
56,031 ____ |
| Total current liabilities | 662,856 ____ |
574,931 ____ |
|
| Total liabilities | 903,429 ____ |
833,625 ____ |
|
| TOTAL EQUITY AND LIABILITIES | 1,534,061 ____ |
1,536,431 ____ |
| S ha re ita l ca p |
Ca ita l p res erv es |
Le l g a res erv es |
Ge l ne ra res erv es |
Re se rve s fro he t m lua io t rev a n ( i co nv ers ) on |
Re se rve s fro he t m lua ion f t rev a o ib le fix d tan g e ts as se |
Re se rve s o n lua t rev a ion f o lon g ter m iva rec e b les |
Re se rve s for ow n ha s res |
Tre as ury ha s res |
Re ine d ta rni ea ng s |
To l ta ity eq u rib att ute b le to a he ity t eq u ho lde f rs o he t Co mp an y |
No n llin ntr co o g int sts ere |
To l ta |
|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Ba lan 31 at ce De mb 20 12 ce er |
41 9, 95 8 |
18 3, 54 9 |
6, 14 3 |
14 73 0 , |
8, 49 0 |
1, 6 9 6 |
- | 4, 27 6 |
( 4, 27 6 ) |
8 0, 04 7 |
71 4, 61 3 |
16 | 71 4, 6 29 |
| C ha in ng es no n llin inte ntr ts co o g res |
- | - | - | - | - | - | - | - | - | - | - | 2 | 2 |
| Ex ha d iffe c ng e ren ce s |
- | ( 40 ) |
- | - | - | - | - | - | - | ( 18 85 1) , |
( 18 89 1) , |
- | ( 18 89 1) , |
| Div ide nd id s p a |
- | - | - | ( 7) 34 |
- | - | - | - | - | ( 4) 33 27 , |
( 1) 33 62 , |
- | ( 1) 33 62 , |
| Th d istr ibu ion f t he t e o fit fro 20 12 p ro m |
- | - | - | 11 49 3 , |
- | - | - | - | - | ( 11 49 3 ) , |
- | - | - |
| Va lua ion f o ha t o wn s res |
- | - | - | - | - | - | - | 78 7 |
( 7) 78 |
- | - | - | - |
| Dis ibu ion tr t s t o loy em p ee s |
- | - | - | 31 0 |
- | - | - | ( 31 0 ) |
31 0 |
- | 31 0 |
- | 31 0 |
| Ac late d inc e t cu mu om ax fte r d du ion ct a e |
- | - | - | ( 2, 135 ) |
- | - | - | - | - | - | ( 2, 135 ) |
- | ( 2, 135 ) |
| Pro fit for he t y ea r |
- | - | - | - | - | - | - | - | - | 42 52 0 , |
42 52 0 , |
( 9 ) |
42 51 1 , |
| Ba lan 31 at ce De mb 20 13 ce er |
41 9, 95 8 |
18 3, 5 0 9 |
6, 14 3 |
24 05 1 , |
8, 49 0 |
1, 6 9 6 |
- | 4, 75 3 |
( ) 4, 75 3 |
5 8, 94 9 |
70 2, 79 6 |
9 | 70 2, 8 05 |
| S ha re ita l ca p |
Ca ita l p res erv es |
Le l g a res erv es |
Ge l ne ra res erv es |
Re se rve s fro he t m lua io t rev a n ( i co nv ers ) on |
Re se rve s fro he t m lua ion f t rev a o ib le fix d tan g e ts as se |
Re se rve s o n lua t rev a ion f o lon g ter m iva rec e b les |
Re se rve s for ow n ha s res |
Tre as ury ha s res |
Re ine d ta rni ea ng s |
To l ta ity eq u rib att ute b le to a he ity t eq u ho lde f rs o he t Co mp an y |
No n llin ntr co o g int sts ere |
To l ta |
|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Ba lan at 31 ce De mb 20 13 ce er |
9, 95 8 41 |
18 3, 0 9 5 |
6, 3 14 |
24 05 1 , |
8, 49 0 |
6 9 6 1, |
- | 3 4, 75 |
( 3 ) 4, 75 |
8, 94 9 5 |
70 2, 79 6 |
9 | 70 2, 8 05 |
| C ha in ng es no n llin inte ntr ts co o g res |
- | - | - | - | - | - | - | - | - | - | - | ( 3 ) |
( 3 ) |
| Ex ha d iffe c ng e ren ce s |
- | 4 | ( ) 3 |
( ) 37 |
- | - | ( ) 82 58 0 , |
- | - | ( ) 4, 03 0 |
( ) 86 64 6 , |
- | ( ) 86 64 6 , |
| Div ide nd id s p a |
- | - | - | - | - | - | - | - | - | ( 33 34 3 ) , |
( 33 34 3 ) , |
- | ( 33 34 3 ) , |
| Th d istr ibu ion f t he t e o fit fro 20 13 p ro m |
- | - | - | 9, 17 7 |
- | - | - | - | - | ( 9, 17 7) |
- | - | - |
| Ac late d s ha cu mu re |
- | - | - | ( 8, 54 2) |
- | - | - | - | - | - | ( 8, 54 2) |
- | ( 8, 54 2) |
| Va lua ion f o ha t o wn s res |
- | - | - | - | - | - | - | ( ) 1, 80 8 |
1, 80 8 |
- | - | - | - |
| Re lua ion t va |
- | - | - | - | 50 17 1 , |
- | - | - | - | 50 17 1 , |
- | 50 17 1 , |
|
| Sa le o f o ha wn s res |
- | - | - | 1, 27 3 |
- | - | - | - | - | - | 1, 27 3 |
- | 1, 27 3 |
| Pro fit for he t y ea r |
- | - | - | - | - | - | - | - | - | 4, 93 0 |
4, 93 0 |
( 13 ) |
4, 91 7 |
| Ba lan 31 at ce De mb 20 14 ce er |
41 9, 95 8 |
18 3, 51 3 |
6, 14 0 |
25 9 22 , |
8, 49 0 |
51 8 67 , |
( 8 2, 5 8 0 ) |
2, 94 5 |
( 2, 94 5 ) |
17 3 29 , |
6 3 0, 6 3 9 |
( 7) |
6 3 0, 6 3 2 |
| 2014 | 2013 | |
|---|---|---|
| Profit for the year | 4,917 | 27,652 |
| Income tax expense | 144 | 754 |
| Depreciation and amortization | 58,990 | 50,370 |
| Net book value of disposed assets | 2,714 | 40,856 |
| Decrease in long-term and short-term provisions | (637) | (1,142) |
| Decrease in corrections of trade receivables, net | (1,795) | (1,658) |
| Shares in profit/loss from investments in associates | (32,641) ____ |
(41,707) ____ |
| Profit from operations before working capital changes | 31,692 ____ |
75,125 ____ |
| Decrease/(Increase) in inventories | 478 | (10,808) |
| (Increase)/decrease in trade receivables | (113,991) | 39,219 |
| Decrease in other receivables | 14,026 | 15,787 |
| Increase in trade payables | 114,340 | 32,301 |
| Decrease in advances received | (37,436) | (3,870) |
| Increase/(decrease) in other short-term and long-term liabilities | 33,978 | (8,917) |
| (Decrease)/increase in accrued expenses and deferred income | (42,361) | 54,314 |
| Decrease/(increase) in prepaid expenses | 99,614 ____ |
(82,408) ____ |
| Cash generated from operations | 100,340 ____ |
110,743 ____ |
| Sale of own shares | 1,273 | - |
| Dividends from associates | 40,987 | 26,930 |
| Incease in depozit | (9,184) | - |
| Increase in long-term liabilities | (8,459) | - |
| Approved short-term and long-term loans | 22,497 | - |
| Purchases of property, plant and equipment, and intangible assets | (137,157) | (264,938) |
| Proceeds short-term loans | - ____ |
10,588 ____ |
| Cash used in investing activities | (90,043) ____ |
(227,420) ____ |
| Dividends paid | (33,342) | (33,621) |
| Bonuses | - | 310 |
| Paid withholding tax | - | (2,135) |
| Received short-term and long-term loans | 125,786 | 293,218 |
| Repayments of borrowings | (123,968) ____ |
(125,614) ____ |
| Cash (used)/generated from financing activities | (31,434) ____ |
132,158 ____ |
| Net cash flow | (21,137) ____ |
15,481 ____ |
| At 1 January | 28,943 | 13,462 |
| Net cash (outflow)/inflow | (21,137) | 15,481 |
| At 31 December | 7,806 ____ |
28,943 ____ |
The company AD Plastik d.d., Solin, a public limited company for the production of motor vehicle spare parts and accessories and of plastic masses (abbreviated firm: AD PLASTIK d.d.), was established by a decision of the Founding Assembly dated 15 June 1994 following the transformation of the socially-owned entity Autodijelovi – Solin pursuant to the decision on the transformation of ownership and the Decision of the Croatian Privatization Fund No. 01-02/92-06/392 of 6 December 1993. The Company is the legal successor of the socially-owned entity Autodijelovi and, according to the decision of the Commercial Court in Split No. Fi 6215/94 of 28 June 1994, assumed all of its assets and liabilities as of the date of registration in the court register.
By decision of the General Shareholders' Assembly dated 21 June 2007, the Statute of the Company of 8 July 2004 was amended and a decision was made to increase the share capital of the Company in cash. Pursuant to the Decision No. Tt-07/2145-3 of 25 July 2007, the increase of the share capital by HRK 125,987,500, effected by OAO Saint Petersburg Investment Company was registered, and the total subscribed capital now amounts to HRK 419,958,400 and consists of 4,199,584 shares, with a nominal amount of HRK 100 each. By the Share Transfer Agreement of 29 June 2009, OAO Spik transferred the shares of the AD Plastik d.d. to OAO Group Aerokosmicheskoe Oborudovanie, St. Petersburg, which transferred those shares on 4th of August 2011 to OAO HAK, Sankt Petersburg.
The Company shares were included in the listing of public limited companies on the Official Market of the Zagreb Stock Exchange on 1 October 2010.
The primary activity of the Company comprises manufacture of motor vehicle spare parts and accessories. The registered activities of the Company comprise the following:
1) Closed-end company ADP Luga, established by an Articles of Association of the Closed-end Company ADP LUGA of 26 March 2007.
Subsidiary ZAO ADP Luga, Luga has change name and headquarter of the Company at the beginning of FY 2012 in ZAP AD Plastik Kaluga, 248016, Skladskaja street 6, Kaluskla oblast, Russian Federation. AD Plastik d.d. has all shares and it is 100% owner.
The Company's registered activities comprise the following:
2) Closed-end foreign investment company PHR (abbreviated firm: ZAO PHR), established on 25 April 1995 and operating under the Constitution of the Russian Federation and the Federal Act on Incorporations. Its registered seat is in Russia, Samara, Krasnoglinski Raion, the village of Vintaj.
The company AD Plastik d.d., Solin, has an equity share of 99.95%.
The Company's registered activities comprise the following:
3) ADP Novo Mesto, d.o.o., Slovenia, established in 1997 and fully owned by Ad Plastik d.d., Solin.
The registered activities of the Company comprise the following:
1) EURO Auto Plastik Systems s.r.l., Romania, established on 20 August 2002 as a limited liability company with its registered seat in Romania, Mioveni, ul. Uzinei, No. 2A.
The equity share of AD Plastik d.d., Solin, in the company is 50 percent.
The principal activities of the associate are as follows:
The equity share of AD Plastik d.d., Solin, in the associate is 40 percent.
The principal activities of the Company are as follows:
An associate is an entity over which the Group has significant influence but which it does not control. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies. Commonly, an equity share from 20 to 50 percent represents an investment in an associate.
In these consolidated financial statements, investments in associates are presented under the equity method.
At 31 December 2014, the number of staff employed was 3,139 (31 December 2013: 2,813).
| 2014 | 2013 | |
|---|---|---|
| AD Plastik d.d. | 1,283 | 894 |
| ZAO PHR | 706 | 704 |
| AD Plastik d.o.o. | 3 | 23 |
| ADP d.o.o. Mladenovac | 172 | 136 |
| ZAO ADP Kaluga | 189 | 181 |
| EURO APS | 593 | 616 |
| FADP | 193 | 259 |
| Mandate | ||||
|---|---|---|---|---|
| Members of the Supervisory Board: | ||||
| Josip Boban (Chairman) | From 19 July 2012 | To 19 July 2016 | ||
| Nikola Zovko (Deputy Chairman) | From 19 July 2012 | To 19 July 2016 | ||
| Marijo Grgurinović | From 14 July 2011 | To 14 July 2015 | ||
| Igor Anatoljevič Solomatin | From 14 July 2011 | To 14 July 2015 | ||
| Drandin Dmitrij Leonidovič | From 19 October 2011 | To 19 October 2015 | ||
| Nikitina Nadežda Anatoljevna | From 19 October 2011 | To 19 October 2015 | ||
| Members of the Management Board: | ||||
| Mladen Peroš (President) | From 19 July 2012 | To 5 February 2015 | ||
| Mladen Peroš (Member) | From 6 February 2015 | To 19 July 2016 | ||
| Marinko Došen (Chairman) | From 6 February 2015 | To 19 July 2016 | ||
| Ivica Tolić | From 19 July 2012 | To 19 July 2016 |
Katija Klepo From 19 July 2012 To 19 July 2016 Denis Fusek From 26 September 2013 To 19 July 2016. Hrvoje Jurišić From 26 September 2013 To 19 July 2016
The following amendments to the existing standards issued by the International Accounting Standards Board and interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC) that are adopted by Europen Union are effective for the current period:
The adoption of these amendments to existing standards, revisions and interpretations has not led to any changes in accounting policies.
IFRSs currently adopted by the EU do not differ significantly from the rules set by the International Accounting Standards Board ("IASB"), except for the following standards, amendments to standards and interpretations whose adoption by the EU 23 April 2015 has not yet been decided:
The Entity anticipates that the adoption of these standards, revisions and interpretations will have no material impact on the financial statements of the Entity in the period of initial application.
Set out below are the principal accounting policies consistently applied in the preparation of the financial statements for the current and prior years.
These financial statements are prepared in accordance with Croatian laws and International Financial Reporting Standards (IFRS) adopted by the European Union.
The Group maintains its accounting records in the Croatian language, in Croatian Kuna and in accordance with Croatian laws and the accounting principles and practices observed by enterprises in Croatia.
The preparation of financial statements in conformity with Croatian laws and International Financial Reporting Standards (IFRSs) adopted by European union; requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates are based on the information available as at the date of preparation of the financial statements, and actual results could differ from those estimates.
The consolidated financial statements of the Group represent aggregate amounts of assets, liabilities, capital and reserves of the Group as of 31 December 2014, and the results of its operations for the year then ended. Some of the financial captions have been reclassified in these financial statements compared to the prior year, as the management is of the opinion that the reclassification provides a better presentation of the financial statements as a whole.
The accounting policies are consistently applied by all the Group entities.
The consolidated financial statements of the Group comprise the consolidated financial statements of the Company and its subsidiaries.
Subsidiaries are entities controlled by the Company. Control is present when the Company is entitled to determine, directly or indirectly, the financial and business policies of the investee so as to derive benefits from its operations. The financial statements of the subsidiaries are included in the Group financial statements on a consolidated basis from the date that control commences until the date that control ceases.
Intra-group balances and transactions, and any unrealized gains arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.
Revenue is measured at the fair value of the consideration received or receivable for products, goods or services sold in the regular course of operations.
Revenues are stated net of value added tax, estimated returns, discounts and rebates. Revenue is recognized when the amount of the revenue can be measured reliably and when future economic benefits are expected to flow into the Group.
Product sales are recognized when the products are delivered to, and accepted by the customer and when the collectability of the receivables is virtually certain.
Accrued revenues are tied to contracts that are specifically concluded contracts for creating an asset or group of assets which is closely linked and interdependent on the draft, technology and function or their final use or application. The Company is required to recognize income according to the stage of completion of contract activity. In accordance with IAS 11, when the result of contract on drafting can be estimated reliably, revenue and costs associated with the contract should be recognized according to the stage of completion of the contracted activities on the date of statement of financial position.
Interest income is recognized on a time basis, using the effective interest method. Interest earned on balances with commercial banks (demand and term deposits) is credited to income for the period as it accrues. Interest on trade debtors is recognized as income upon settlement.
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.
All other borrowing costs are included in profit or loss in the period in which they are incurred.
Transactions in foreign currencies are translated into Croatian kunas at the rates of exchange in effect at the dates of the transactions. Cash, receivables and payables denominated in foreign currencies are retranslated at the rates of exchange in effect at the date of the statement of financial position. Gains and losses arising on translation are included in the statement of comprehensive income for the year. At 31 December 2013, the official exchange rate of the Croatian kuna against 1 euro (EUR) was HRK 7.661471 (31 December 2013: HRK 7.637643 for 1 EUR).
Income tax expense represents the sum of the tax currently payable and deferred tax. Income tax is recognized in the income statement, except where it relates to items recognized directly in equity, in which case it is also recognized in equity. Current tax represents tax expected to be paid on the basis of taxable profit for the year, using the tax rate enacted at the balance sheet date, adjusted by appropriate prior-period items.
Under Croatian tax regulations, group entities are not subject to taxation on a consolidated bases, and tax losses cannot be transferred within group entities. Subsidiaries are subject to taxation in their respective jurisdictions.
Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates in effect at the balance sheet date.
The measurement of deferred tax liabilities and assets reflects the amount that the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax liabilities and assets are not discounted and are classified in the balance sheet as non-current assets and/or non-current liabilities. Deferred tax assets are recognized only to the extent that it is probable that the related tax benefit will be realized. At each balance sheet date, the Company reviews the unrecognized potential tax assets and the carrying amount of the recognized tax assets.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities.
In the case of a business combination, the tax effect is taken into account in calculating goodwill or in determining the excess of the acquirer's interest in the net fair value of the acquiree's identifiable assets, liabilities and contingent liabilities over cost.
Tangible fixed assets are recognized initially at cost and subsequently at cost less accumulated depreciation. The initial cost of property, plant and equipment comprises its purchase price, including import duties and nonrefundable sales taxes and any directly attributable costs of bringing an asset to its working condition and location for its intended use. Maintenance and repairs, replacements and improvements of minor importance are expensed as incurred. Where it is obvious that expenses incurred resulted in increase of expected future economic benefits to be derived from the use of an item of tangible or intangible assets in excess of the originally assessed standard performance of the asset, they are added to the carrying amount of the asset. Gains or losses on the retirement or disposal of tangible fixed assets are included in the statement of comprehensive income in the period they occur. Depreciation commences on putting an asset into use. Depreciation is provided so as to write down the cost or revalued amount of an asset, other than land, tangible and intangible assets under construction over the estimated useful life of the asset using the straight-line method as follows:
| Depreciation rate in | Depreciation rate in | |
|---|---|---|
| 2014 | 2013 | |
| 1. Tangible assets | ||
| Buildings | 1.50 | 1.50 |
| Machinery | 7.00 | 7.00 |
| Tools, furniture, office and | 10.00 | 10.00 |
| laboratory equipment and | ||
| accessories, measuring and | ||
| control instruments | ||
| Vehicles | 20.00 | 20.00 |
| IT equipment | 20.00 | 20.00 |
| Other | 10.00 | 10.00 |
| Projects | 20.00 | 20.00 |
At each reporting date the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is an indication that the assets may be impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. Where a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified.
An associate is an entity over which the Company has significant influence but which is neither a subsidiary nor a joint venture. Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.
The results and assets and liabilities of associates are incorporated in these financial statements using the equity method of accounting. Under this method, the Group's share in the profit or loss of associates is recognized in the income statement from the date of acquisition of significant influence until the date on which significant influence is lost.
Investments are recognized initially at cost and are subsequently adjusted by the changes in the acquirer's share of the net profit of the investee. Where the Group's share of losses in an associate is equal to or higher than the equity investment in the associate, no further losses are recognized, except where the Group has assumed an obligation or committed to make a payment on behalf of the associate.
Inventories of raw material and spare parts are stated at the lower of cost and net realizable value. Cost is determined using the weighted-average cost method. Net realizable value represents the estimated selling price in the ordinary course of business less all variable selling costs.
Cost of work in progress and finished products comprises the cost of raw material and supplies, direct labor and other costs and the portion of overheads directly attributable to work in progress.
Small inventory is written off when put in use.
The cost of product inventories i.e. the production costs is based on direct material used, the cost of which is determined using the weighted average cost method, then direct labor costs, and fixed overheads at the actual level of production which approximates the normal capacities, as well as variable overheads that are based on the actual use of the production capacities.
Merchandise on stock is recognized at purchase cost.
Trade debtors and prepayments are carried at nominal amounts less an appropriate allowance for impairment for uncollectible amounts.
Impairment is made whenever there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, the probability of bankruptcy proceedings at the debtor, or default or delinquency in payment are considered objective evidence of impairment. The amount of the impairment loss is determined as the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate.
Management provides for doubtful receivables based on a review of the overall ageing of all receivables and a specific review of significant individual amounts receivable with individual approach to strategic buyers of ADP Group and the age structure of other current receivables. The allowance for amounts doubtful of collection is charged to the statement of comprehensive income for the year.
Cash comprises account balances with banks, cash in hand, deposits and securities at call or with maturities of less than three months.
Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. Provisions are reviewed at each date of the statement of financial position and adjusted to reflect the current best estimate. Where the effect of discounting is material, the amount of the provision is the present value of the expenditures expected to be required to settle the obligation, determined using the estimated risk free interest rate as the discount rate. Where discounting is used, the reversal of such discounting in each year is recognized as a financial expense and the carrying amount of the provision increases in each year to reflect the passage of time.
The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the date of the statement of financial position, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.
In the normal course of business the Group makes payments, through salary deductions, to mandatory pension funds on behalf of its employees as required by law. All contributions made to the mandatory pension funds are recognized as salary expense when accrued. The Group does not operate any other retirement benefit plan and, consequently, has no other obligations in respect of the retirement benefits for its employees. In addition, the Group is not obliged to provide any other post-employment benefits.
Termination benefits are payable when employment is terminated by the Group before the normal retirement date. The Group recognizes its termination benefit obligations in accordance with applicable union agreements.
Benefits falling due more than 12 months after the reporting date are discounted to their present value.
For defined benefit retirement benefit plans, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at each reporting date. Actual gains and losses are recognized in the period in which they arise.
Past service cost is recognized immediately to the extent that the benefits are already vested. Otherwise, it is amortized on a straight-line basis over certain period until the benefits become vested.
Financial assets and financial liabilities included in the accompanying financial statements consist of cash and cash equivalents, marketable securities, trade and other receivables, trade and other payables, long-term receivables, loans, borrowings and investments. The details of the recognition and measurement of those items are presented in the corresponding policies.
Investments are recognized and derecognized on a trade date where the purchase or sale of an investment is under a contract whose terms require delivery of the investment within the timeframe established by the market concerned, and are initially measured at fair value, net of transaction costs, except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value.
The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.
Trade receivables, loans, and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Loans and receivables are measured at amortized cost using the effective interest method, less any impairment. Interest income is recognized by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.
Financial assets available for sale are classified as current assets if the management intends to realize those assets within 12 months from the date of the statement of financial position. Every purchase and sale transaction in recognized on the settlement date. Investments are recognized initially at cost, which represents the fair value of the consideration given, including transaction costs. Available-for-sale investments are subsequently measured at fair value, with no deduction of transaction costs, by reference to their market prices prevailing at the date of the statement of financial position. Investments whose fair values cannot be determined are carried at cost and reviewed for impairment at each reporting date.
The effective interest method is a method of calculating the amortized cost of a financial asset or liability, and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial asset or liability, or, where appropriate, a shorter period.
Financial assets are assessed for indicators of impairment at each date of the statement of financial position. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been impacted. For financial assets carried at amortized cost, the amount of the impairment is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate.
The carrying amount of a financial asset is reduced through the use of an allowance account. When a trade receivable is uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account.
The Group derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire; or it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognizes its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognize the financial asset and also recognizes a collateralized borrowing for the proceeds received.
Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement.
Part of Group's subsidiaries chosen, for fixed assets, revaluation as a method of subsequent measurement. When the carrying value of these assets increased as a result of a revaluation, the increase is recognized in other comprehensive income and is cumulatively recorded in equity as a revaluation reserve. Revaluation of these assets is carried out with sufficient regularity so that the carrying amount does not differ materially from those to which would be determined using fair value at the date of the statement of financial position. At the moment of derecognition of assets (where the assets are withdrawn from use or is stolen) revaluation surplus is included in equity, and that applies to this property, can be directly transferred to retained earnings.
The Group may have a monetary item that is receivable or liability towards the foreign entity. An item for which settlement is neither planned nor likely to occur in the foreseeable future, is essentially part of the entity's net investment in a foreign operation and according to accounting is accounted for in accordance with IAS 21. The Group initially recognizes foreign exchange differences arising from monetary items that are part of the net foreign investments within other comprehensive income and accumulates in a separate component of equity - revaluation reserves.
During sale of the net investment in a foreign operation, the total amount of foreign exchange losses is transferred from equity to profit or loss (as a reclassification adjustment).
Contingent liabilities have not been recognized in these financial statements. They are not disclosed unless the possibility of outflow of resources embodying economic benefits is remote. A contingent asset is not recognized in the financial statements but it is disclosed when the inflow of economic benefits becomes probable.
Events after the date of the statement of financial position that provide additional information about the Company's position at that date (adjusting events) are reflected in the financial statements. Post-year-end events that are not adjusting events are disclosed in the notes when material.
In the application of the Group's accounting policies, which are described in Note 3, the directors are required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on past experience and other factors that are considered to be relevant. Actual results may differ from those estimates.
The estimates and underlying assumptions are continually reviewed. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of revision and future periods if the revision affects both current and future periods.
Areas of estimation include, but are not limited to, depreciation periods and residual values of property, plant and equipment, and of intangible assets, value adjustment of inventories, impairment of receivables, and litigation provisions. The key areas of estimation in applying the Company's accounting policies that had a most significant impact on the amounts recognized in the financial statements were as follows:
As described in the Note 3.8, the Group reviews the estimated useful lives of property, plant and equipment at the end of each annual reporting period. Property, plant and equipment are recognized initially at cost, less accumulated depreciation.
A deferred tax asset is recognized only to the extent that it is probable that the related tax benefit will be realized. In determining the amount of deferred taxes that can be recognized significant judgments are required, which are based on the probable quantification of time and level of future taxable profits, together with the future tax planning strategy. In 2014, deferred tax assets on available tax differences were recognized.
Management provides for doubtful receivables based on a review of the overall ageing of all receivables and a specific review of significant individual amounts receivable. The allowance for amounts doubtful of collection is charged to the statement of comprehensive income for the year.
The cost of defined benefits is determined using actuarial estimates. Actuarial estimates involve assumptions about discount rates, future salary increases and the mortality or fluctuation rates. Because of the long-term nature of those plans, there is uncertainty surrounding those estimates.
The Group has adopted IFRS 8 Operating Segments with effect from 1 January 2009. IFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Group that are regularly reviewed by the chief operating decision maker in order to allocate resources to the segments and to assess their performance.
Segment revenue analysis by country:
| 2014 | 2013 | |
|---|---|---|
| Russia | 320,777 | 346,659 |
| Slovenia | 301,571 | 220,750 |
| Germany | 91,897 | 106,287 |
| France | 111,101 | 90,753 |
| Other countries | 44,207 ____ |
53,142 ____ |
| 869,553 ____ |
817,591 ____ |
Sales represent amounts receivable (excluding excise and similar duties) for goods sold and services rendered.
| 2014 | 2013 | |
|---|---|---|
| Foreign sales | 860,000 | 803,601 |
| Domestic sales | 9,553 ____ |
13,990 ____ |
| 869,553 ____ |
817,591 ____ |
| 2014 | 2013 | |
|---|---|---|
| Income from sale of assets | 5,487 | 2,027 |
| Income from bonuses provided by suppliers | 2,222 | 1,534 |
| Income from the reversal of provisions for jubilee | 1,568 | 1,421 |
| Income from consumption of own products, goods and services | 1,377 | 1,116 |
| Income from the reversal of provisions for pensions | 1,084 | 780 |
| Income from damages collected | 789 | 118 |
| Revenue from the tax return | - | 4,431 |
| Other operating income | 15,397 ____ |
6,573 ____ |
| 27,924 ____ |
18,180 ____ |
| 2014 | 2013 | |
|---|---|---|
| Direct materials | 394,632 | 332,227 |
| Electricity | 18,332 | 19,044 |
| Other expenses | 21,954 ____ |
25,828 ____ |
| 434,918 ____ |
377,099 ____ |
| 2014 | 2013 | |
|---|---|---|
| Cost of goods sold | 21,789 | 18,083 |
| Cost of spare parts sold | 5,994 | 6,595 |
| Cost of direct material sold | 3,388 | 6,113 |
| Other costs of goods sold | 5,056 ____ |
1,453 ____ |
| 36,227 ____ |
32,244 ____ |
| 2014 | 2013 | |
|---|---|---|
| Net wages and salaries | 101,837 | 94,616 |
| Taxes and contributions out of salaries | 32,582 | 29,908 |
| Contributions on salaries | 29,188 | 26,528 |
| Other staff costs | 18,589 ____ |
14,606 ____ |
| 182,196 ____ |
165,658 ____ |
Other staff costs comprise daily allowances, transportation and overnight accommodation costs on business travel, reimbursement of a portion of costs for the use of personal cars for business purposes and other business related costs.
| 2014 | 2013 | |
|---|---|---|
| Depreciation | 46,877 | 41,205 |
| Amortization | 12,113 ____ |
9,165 ____ |
| 58,990 ____ |
50,370 ____ |
| 2014 | 2013 | |
|---|---|---|
| Transport | 23,911 | 23,500 |
| Rental costs | 8,099 | 8,318 |
| Regular and preventive maintenance costs - machinery | 3,236 | 7,480 |
| Telecommunications and information system costs | 1,958 | 1,627 |
| Communal fees | 1,631 | 1,682 |
| Tool modification costs | 1,219 | 1,837 |
| Water supply | 1,090 | 1,085 |
| Forwarding and shipping costs | 672 | 429 |
| Know-how costs | 51 | 518 |
| Other expenses | 24,343 ____ |
8,343 ____ |
| 66,209 ____ |
54,819 ____ |
| 2014 | 2013 | |
|---|---|---|
| Temporary service costs - manufacture of tools | 83,572 | 102,976 |
| Professional service cost | 5,436 | 5,931 |
| Insurance premiums | 3,024 | 3,187 |
| Bank charges | 2,126 | 1,512 |
| Communal fees for the use of construction plots | 1,588 | 1,337 |
| Payment operation charges | 1,457 | 960 |
| Customer complaints | 841 | 647 |
| Cost of goods provided free of charge | 762 | 622 |
| Representation | 701 | 298 |
| Professional training costs | 618 | 266 |
| Occupational Health and Safety service costs | 526 | 302 |
| Other fees (Supervisory Board) | 483 | 1,668 |
| Forest reproduction levies | 189 | 149 |
| Water management fee | 161 | 209 |
| Translation service costs | 41 | 81 |
| Other external costs | 15,451 ____ |
10,983 ____ |
| 116,976 ____ |
131,128 ____ |
| 2014 | 2013 | |
|---|---|---|
| Property tax | 1,472 | 1,687 |
| Other expenses | 8,024 ____ |
4,800 ____ |
| 9,496 ____ |
6,487 ____ |
| 2014 | 2013 | |
|---|---|---|
| Provisions under actuarial calculations | 1,990 | 2,652 |
| Vacation accruals, net | 1,039 | 1,004 |
| Litigation provisions, net | 370 | - |
| Other provisions | 21 ____ |
296 ____ |
| 3,420 ____ |
3,952 ____ |
| 2014 | 2013 | |
|---|---|---|
| Foreign exchange gains | 30,540 | 12,804 |
| Interest income | 9,301 | 10,829 |
| Other finance revenue | 1,562 ____ |
416 ____ |
| 41,403 ____ |
24,049 ____ |
| 2014 | 2013 | |
|---|---|---|
| Foreign exchange losses | 35,405 | 38,620 |
| Interest expense | 25,762 | 19,940 |
| Other finance costs | 2,012 ____ |
- ____ |
| 63,179 ____ |
58,560 ____ |
| 2014. | 2013. | |
|---|---|---|
| Income from share of profit of associates | 40.227 | 41.708 |
| Expenses from the share of loss from associates | (7.328) ____ |
- ____ |
| 32.899 ____ |
41.708 ____ |
Income tax comprises the following:
| 2014 | 2013 | |
|---|---|---|
| Deferred tax | 132 | 695 |
| Current tax | 12 ___ |
59 ___ |
| 144 ___ |
754 ___ |
|
| Deferred tax, as presented in the statement of financial position, is as follows: | ||
| 2014 | 2013 | |
| Balance at 1 January | 1,992 | 2,687 |
| Deferred tax assets increase/(decrease) | 11,658 ___ |
(695) ___ |
| Balance at 31 December | 13,650 | 1,992 |
_________ _________
Deferred tax assets arise from the following:
| 2014 | Opening balance |
Credited to statement of comprehensive income |
Closing balance |
|---|---|---|---|
| Temporary differences: | |||
| Provisions for long-service and termination benefits | 1,992 | (655) | 1,337 |
| Provisions from the translation of foreign currencies, net | - | 24,856 | 24,856 |
| Provisions for revaluation reserves of tangible and intangible assets |
- ___ |
(12,543) ___ |
(12,543) ___ |
| Balance at 31 December | 1,992 ___ |
11,658 ___ |
13,650 ___ |
| 2013 | Opening balance |
In favor to statement of comprehensive income |
Closing balance |
| Temporary differences: | |||
| Provisions for long-service and termination benefits | 2,687 ___ |
(695) ___ |
1,992 ___ |
| Balance at 31 December | 2,687 ___ |
(695) ___ |
1,992 ___ |
Reconciliation of accounting and tax expense for the year:
| 2014 | 2013 | |
|---|---|---|
| Profit before tax | 5,061 ___ |
28,406 ___ |
| Tax base increasing items | 7,554 | 4,973 |
| Tax base decreasing items | (2,946) ___ |
(29,365) ___ |
| Tax base | 9,669 ___ |
4,014 ___ |
| Tax at the weighted average rate | 2,795 | 4,361 |
| Tax reliefs | (2,651) ___ |
(3,607) ___ |
| Current tax liability | 144 ___ |
754 ___ |
On 24 October 2012 the Company filed with the Ministry of Economy the Application for Incentive Measures for the investment project "Expansion of Production for the Purpose of Export of Car Industry Products", in accordance with the Act on Investment Promotion and Development of Investment Climate (OG 111/2012 and 28/2013) and the Investment Promotion and Development of Investment Climate (OG 40 of 5 April 2013).
As a result, the Company made investments in fixed assets in 2014, having thus met the prerequisites for the utilization of the tax incentives for 2014.
| 31.12.2014. | 31.12.2013. | |
|---|---|---|
| Balance at beginning of year | - ___ |
- ___ |
| Exchange differences on translation of foreign operations | (107,455) | - |
| Changes of revaluation reserves of long-term tangible and intangible assets |
62,714 | - |
| Income tax at the foreign exchange losses from the translation of foreign operations |
12,311 ___ |
- ___ |
| Balance at end of year | (32,430) ___ |
- ___ |
Basic earnings per share are determined, by dividing the Group's net profit by the weighted average number of ordinary shares in issue during the year, excluding the average number of ordinary shares redeemed and held by the Company as treasury shares. Diluted earnings per share are equal to basic earnings.
| 2014 | 2013 | |
|---|---|---|
| Net profit attributable to the Company shareholders | 4,917 | 27,652 |
| Weighted average number of shares | 4,167,822 ___ |
4,161,822 ___ |
| Basic earnings per share (in HRK) | 1.18 ___ |
6.64 ___ |
| Licenses | Software | Projects | Total | |
|---|---|---|---|---|
| Cost | ||||
| Balance at 31 December 2012 | 55 | 3,470 | 153,362 | 156,887 |
| Additions | 4,303 | 84,449 | 88,752 | |
| Disposals and retirements | ___ | ____ | (23,448) ____ |
(23,448) ____ |
| Balance at 31 December 2013 | 55 ___ |
7,773 ___ |
214,363 ___ |
222,191 ___ |
| Additions | - | 19 | 44,264 | 44,283 |
| Disposals and retirements | - ____ |
- ____ |
(1,136) ____ |
(1,136) ____ |
| Balance at 31 December 2014 | 55 ____ |
7,792 ____ |
257,491 ____ |
265,338 ____ |
| Accumulated depreciation | ||||
| Balance at 31 December 2012 | - | 1,535 | 94,541 | 96,076 |
| Charge for the year | - | 1,139 | 8,026 | 9,165 |
| Disposals and retirements | - ____ |
- ____ |
(4,154) ____ |
(4,154) ____ |
| Balance at 31 December 2013 | - ___ |
2,674 ___ |
98,413 ___ |
101,087 ___ |
| Charge for the year | - | 1,610 | 10,503 | 12,113 |
| Disposals and retirements | - ____ |
- ____ |
- ____ |
- ____ |
| Balance at 31 December 2014 | - ____ |
4,284 ____ |
108,916 ____ |
113,200 ____ |
| Net book value | ||||
| At 31 December 2014 | 55 ___ |
3,508 ___ |
148,575 ___ |
152,138 ___ |
| At 31 December 2013 | 55 ___ |
5,099 ___ |
115,950 ___ |
121,104 ___ |
Projects comprise investments in the development of new products that are expected to generate revenue in future periods. Consequently, the costs are amortized over the period in which the related economic benefits flow into the Group.
| Land | Buildings | Plant and equipment |
Assets under construction |
Other | Total | |
|---|---|---|---|---|---|---|
| Cost | ||||||
| Balance at 31 December 2012 | 139,976 | 297,141 | 449,974 | 55,750 | 1,549 | 944,390 |
| Additions | 3,660 | 11,977 | 60,255 | 100,294 | - | 176,186 |
| Transfer from assets under development |
- | 624 | 5,836 | (6,460) | - | - |
| Disposals and retirements | - | - | (13,458) | (15,880) | - | (29,338) |
| Balance at 31 December 2013 | 143,636 | 309,742 | 502,607 | 133,704 | 1,549 | 1,091,238 |
| Additions | - | 150 | - | 90,261 | 2,463 | 92,874 |
| Transfer from assets under development |
- | 4,468 | 126,173 | (130,641) | - | - |
| Disposals and retirements | (1,244) | - | (6,929) | - | - | (8,173) |
| Balance at 31 December 2014 | 142,392 | 314,360 | 621,851 | 93,324 | 4,012 | 1,175,939 |
| Accumulated depreciation | ||||||
| Balance at 31 December 2012 | - | 65,402 | 279,641 | - | 1,549 | 346,592 |
| Charge for the year 2013 | - | 7,418 | 33,787 | - | - | 41,205 |
| Disposals and retirements | - | - | (7,776) | - | - | (7,776) |
| Balance at 31 December 2013 | - | 72,820 | 305,652 | - | 1,549 | 380,021 |
| Charge for the year 2014 | - | 5,848 | 39,934 | - | 1,095 | 46,877 |
| Disposals and retirements | - | - | (6,595) | - | - | (6,595) |
| Balance at 31 December 2014 | - | 78,668 | 338,991 | - | 2,644 | 420,303 |
| Net book value | ||||||
| At 31 December 2014 | 142,392 | 235,692 | 282,860 | 93,324 | 1,368 | 755,636 |
| At 31 December 2013 | 143,636 | 236,922 | 196,955 | 133,704 | - | 711,217 |
At 31 December 2014, the net book value of tangible assets pledged as collateral with commercial banks amounts to HRK 392,904 thousand (31 December 2013: HRK 333,868 thousand), and the balance of short-term and longterm loans secured by those assets is HRK 352,110 thousand (31 December 2013: HRK 403.092 thousand).
| Name of associate | Principal activity | Country of incorporation and |
Ownership interest in % | Amount of equity investment, HRK'000 |
|||
|---|---|---|---|---|---|---|---|
| business | 2014 | 2013 | 2014 | 2013 | |||
| EURO AUTO PLASTIC SYSTEMS |
Manufacture of other vehicle spare parts and accessories |
Mioveni, Romania | 50.00% | 50.00% | 81,732 | 82,492 | |
| FAURECIA AD PLASTIK ROMANIA (FAAR) |
Manufacture of other vehicle spare parts and accessories Manufacture of other |
Mioveni, Romania | 49.00% | 49.00% | - | 258 | |
| FAURECIA ADP HOLDING |
vehicle spare parts and accessories |
Nanterre, France | 40.00% | 40.00% | 10,934 | 18,262 |
Subsidiary "Faurecia AD Plastik Romania (FAAR)" from Romania was liquidated and booked from business accounts in May 2014.
| Name of associate | Country of incorporation and business |
Amount of equity investment |
Share in the result for the year 2012 |
Dividends paid | Amount of equity investment |
|---|---|---|---|---|---|
| 31.12.2012 | 31.12.2013 | ||||
| EURO AUTO PLASTIC SYSTEMS |
Mioveni, Romania | 68,285 | 41,137 | (26,930) | 82,492 |
| FAURECIA AD PLASTIK ROMANIA (FAAR) |
Mioveni, Romania | 258 | - | - | 258 |
| FAURECIA ADP HOLDING |
Nanterre, France | 17,692 | 571 | - | 18,262 |
| Total | 86,235 | 41,708 | (26,930) | 101,012 |
| Name of associate | Country of incorporation and business |
Amount of equity investment |
Share in the result for the year 2013 |
Dividends paid | Amount of equity investment |
|---|---|---|---|---|---|
| 31.12.2013 | 31.12.2014 | ||||
| EURO AUTO PLASTIC | |||||
| SYSTEMS | Mioveni, Romania | 82,492 | 40,227 | (40,987) | 81,732 |
| FAURECIA AD PLASTIK ROMANIA |
|||||
| (FAAR) | Mioveni, Romania | 258 | - | - | - |
| FAURECIA ADP | |||||
| HOLDING | Nanterre, France | 18,262 | (7,328) | - | 10,934 |
| Total | 101,012 | 32,899 | (40,987) | 92,666 |
92,666 101,012
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Long-term loans to associates | 44,156 | 50,103 |
| Long-term loans to unrelated companies | 11,543 | 14,508 |
| Other financial assets | 64 | 64 |
| Current portion of long-term loan receivables | (3,137) ____ |
(10,341) ____ |
| 52,626 ____ |
54,334 ____ |
Long-term loans to associated companies are given with interest rate of 12.79 to 20.34% (2013: 12.68 to 13.09%) with maturity in 2016, while Long term loans given to third parties with an interest rate of 6.00% (in 2013: 6.00%) with final maturity in 2021.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Raw material and supplies on stock | 67,176 | 64,277 |
| Finished products | 18,787 | 17,812 |
| Work in progress | 6,647 | 3,688 |
| Merchandise | 1,705 | 8,198 |
| Advances for inventories | - ____ |
818 ____ |
| 94,315 ____ |
94,793 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Foreign trade receivables | 206,143 | 146,164 |
| Domestic trade receivables | 9,835 | 12,635 |
| Impairment allowance on receivables | (8,569) ____ |
(10,364) ____ |
| 207,409 ____ |
148,435 ____ |
The average credit period on sales is 72 days (2013: 68 days). The Company has provided for all for all receivables handed over to the courts for collection, regardless of the past due period, as well as for all receivables that are past due and assessed as doubtful of collection.
The Company seeks and obtains from its domestic customers debentures as collaterals in the amount of the receivables.
Set out below is an analysis of major trade receivables:
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Revoz, Slovenia | 57,883 | 5,371 |
| Visteon Deutschland, Germany | 36,586 | 21,670 |
| OAO Avtovaz, Russia | 31,784 | 24,012 |
| Grupo Antolin, Germany | 21,487 | - |
| Hella Saturnus, Slovenia | 6,779 | - |
| Peugeot Citroen Automobiles, France | 5,524 | 5,695 |
| Other debtors | 55,935 ____ |
102,051 ____ |
| 215,978 ____ |
158,799 ____ |
Movements in the impairment allowance on domestic trade receivables were as follows:
| 31/12/2014 | 31.12.2013 | |
|---|---|---|
| Balance at beginning of the year | 8,890 | 10,241 |
| Amounts collected or eliminated during the year | (1,463) ____ |
(1,351) ____ |
| Total impairment allowance on domestic trade receivables | 7,427 ____ |
8,890 ____ |
| Balance at beginning of the year | 1,474 | 1,781 |
| Amounts collected or eliminated during the year | (332) ____ |
(307) ____ |
| Total impairment allowance on foreign trade receivables | 1,142 ____ |
1,474 ____ |
| Total impairment allowance | 8,569 ____ |
10,364 ____ |
All receivables provided for are under litigation or included in bankruptcy estate. Ageing analysis of impaired receivables:
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| 0 – 365 days | - | 524 |
| Over 365 days | 8,569 ____ |
9,840 ____ |
| 8,569 ____ |
10,364 ____ |
|
| Ageing analysis of receivables past due but not impaired: |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| 1 - 365 days | 8,126 | 9,619 |
| Over 365 days | 1,254 ____ |
1,354 ____ |
| 9,380 ____ |
10,973 ____ |
Receivables from associated companies
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Trade receivables | 3,961 | 4,072 |
| Interest receivable | - ____ |
7,845 ____ |
| 3,961 ____ |
11,917 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Prepayments made | 24,190 | 39,618 |
| Receivables from the State and state institutions | 18,097 | 15,447 |
| Due from employees | 482 | 597 |
| Other receivables | 5,759 ____ |
6,892 ____ |
| 48,528 ____ |
62,554 __ |
Amounts due from the State and state institutions comprise receivables from the State Budged in respect of VAT refund, refunds from the Croatian Health Insurance Fund and similar.
Foreign prepayments comprise prepayments made for purchases of production equipment and tools.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Other short-term loans | 3,209 | - |
| Current portion of long-term loan receivables | 3,137 | 10,341 |
| Short-term loans to subsidiaries | - | 16,794 |
| Other deposits | 9,193 ____ |
9 ____ |
| 15,539 ____ |
27,144 __ |
Other short-term loans to third parties are related to the loan granted to the company Autocentar-Merkur d.d., Zagreb with 7.2% interest rate, with a maturity in the first quarter of 2015.
Other deposits relate to deposit of the company ZAO PHR at an interest rate of 17%.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Current account balance | 7,806 | 28,492 |
| Deposits with a term of up to 3 months | - ____ |
451 ____ |
| 7,806 ____ |
28,943 ____ |
Accrued income in the amount of HRK 64,248 thousand (31 December 2013: HRK 171,896 thousand) represent amounts relating to the manufacture of tools for a known customer. Income from the manufacture of tools is recognized using the stage-of-completion method to determine the amount of income and costs attributable to a certain period.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Other accrued income on tools | 64,248 | 171,896 |
| Prepaid operating expenses | 14,444 | 10,004 |
| Other accrued income | 6,597 ____ |
3,003 ____ |
| 85,289 ____ |
184,903 ____ |
Subscribed capital amounts to HRK 419,958 thousand and consists of 4,199,580 shares, with a nominal value of HRK 100.00 per share ( 31 December 2013: HRK 419,958 thousand, 4,199,580 shares, with a nominal value of HRK 100 each).
The shareholders with over 2 percent of the shares at 31 December 2014 were as follows:
| Number of | Type of | |||
|---|---|---|---|---|
| Shareholder | Headquarters | shares | Ownership in % | account |
| OAO Holding Autokomponenti HYPO ALPE-ADRIA-BANK |
Sankt-Peterburg, Russia | 1,259,875 | 30.00% | Primary account |
| D.D./RAIFFEISEN MANDATORY PENSION FUND |
Zagreb, Croatia | 269,462 | 6.42% | Pension fund |
| ADP-ESOP D.O.O. | Zagreb, Croatia | 212,776 | 5.07% | Primary account |
| PBZ D.D. / STATE STREET CLIENT |
Zagreb, Croatia | 120,892 | 2.88% | Custody account |
| HYPO ALPE-ADRIA-BANK D.D./PBZ CROATIA OSIGURANJE MANDATORY PENSION FUND |
Zagreb, Croatia | 119,640 | 2.85% | Pension fund |
| SOCIETE GENERALE SPLITSKA BANKA D.D. / ERSTE PLAVI OMF |
Split, Croatia | 115,353 | 2.75% | Pension fund |
| HRVATSKA POŠTANSKA BANKA D.D./ KAPITALNI FOND D.D. |
Zagreb, Croatia | 111,541 | 2.66% | Pension fund |
| ERSTE & SEIERMARKISCHE BANK d.d./ZBIRNI SKRBNIČKI RAČUN ZA STRANU PRAVNU OSOBU |
Zagreb, Croatia | 110,349 | 2.63% | Custody account |
| SOCIETE GENERALE SPLITSKA BANKA D.D. / AZ OMF KATEGORIJE B |
Split, Croatia | 93,900 | 2.24% | Pension fund |
| Total: | 2,413,788 | 57.50% |
| Short-term: | Long-term: | |||
|---|---|---|---|---|
| 31 December 31 December 2014 2013 |
31 December 31 December 2014 2013 |
|||
| Jubilee awards | - - 1,302 - - 688 |
1,568 | ||
| Retirement benefits | 1,084 | |||
| Legal actions | 3,720 | 3,351 | - | - |
| Tax disputes | 51 | 1,105 | - | - |
| Vacation accrual | 3,197 | 2,158 | - | - |
| Other provisions | 638 ____ |
967 ____ |
- ____ |
- ____ |
| 7,606 ____ |
7,581 ____ |
1,990 ____ |
2,652 ____ |
| Jubilee awards |
Retireme nts |
Court disputes |
Taxes | Vacation days |
Other | Total | |
|---|---|---|---|---|---|---|---|
| Balance 1 January | |||||||
| 2013 | 1,718 | 2,191 | 3,389 | 347 | 2,258 | 1,072 | 11,375 |
| Increase/(decrease) | |||||||
| in provision | (150) | (1,107) | (38) | 758 | (100) | (105) | (1,142) |
| Balance 31 | _ | ||||||
| December 2013 | 1,568 | 1,084 | 3,351 | 1,105 | 2,158 | 967 | 10,233 |
| Increase/(decrease) | |||||||
| in provision | (266) __ |
(396) __ |
369 __ |
(1,054) _ |
1,039 __ |
(329) _ |
(637) __ |
| Balance 31 | __ | __ | __ | _ | __ | _ | __ |
| December 2014 | 1,302 __ __ |
688 __ __ |
3,720 __ __ |
51 _ __ |
3,197 __ __ |
638 _ __ |
9,596 __ __ |
According to the Collective Agreement, the Company has the obligation to pay long-service (jubilee awards), retirement and other benefits to employees. The Company operates a defined benefit plan for qualifying employees. Retirement and long-service benefits are defined in the Union Agreement. No other post-retirement benefits are provided.
Long-service benefits are paid for full years of service in the month of the current year in which the service is determined as completed.
The present value of defined benefit obligations and the related current and past service cost have been determined using the Projected Credit Unit method.
Key assumptions used in calculating the required provisions are the discount rate of 4.18% and the rate of fluctuation of 5.90 %.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Long-term borrowings | 301,471 | 366,501 |
| Current portion of long-term borrowings | (89,127) ____ |
(110,685) ____ |
| 212,344 | 255,816 | |
| Other non-current liabilities | 26,239 ____ |
226 ____ |
| 238,583 ____ |
256,042 ____ |
Long-term loans are mainly used to finance capital investments and development projects. Provided collaterals for long-term loans are mortgages on real estates and/or equipment and instruments of payment. All long-term loans are repayable on a quarterly basis, repayment of existing long-term loans is in the period March 31st, 2015 – December 31st, 2021.
The average interest rate on long-term loans in 2014 amounted to 4.28%.
The Group regularly performs all obligations from these loans, respecting all the conditions of the contract.
Movements in long-term borrowings during the year:
| 2014 | 2013 | |
|---|---|---|
| Balance at 1 January | 255,816 | 201,618 |
| New loans raised | 80,496 | 179,677 |
| Amounts repaid | (123,968) ____ |
(125,479) ____ |
| Balance at 31 December | 212,344 ____ |
255,816 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Foreign customers | 57,224 | 94,575 |
| Domestic customers | - ____ |
85 ____ |
| 57,224 ____ |
94,660 ____ |
Advances received from foreign customers represent cash advanced for ordered tools.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Foreign trade payables | 219,295 | 129,442 |
| Domestic trade payables | 51,130 ____ |
26,643 ____ |
| 270,425 ____ |
156,085 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Short-term borrowings - principal payable | 194,548 | 127,614 |
| Current portion of long-term borrowings | 89,127 | 110,685 |
| Short-term borrowings - interest payable | 1,668 ____ |
1,664 ____ |
| 285,343 ____ |
239,963 ____ |
Short-term loans were used to finance development projects and for working capital. Provided collaterals for shortterm loans are instruments of payment. Of the total amount of short-term loans 40% of short-term loans is related to the revolving frames and approved overdrafts on accounts with the annual renewal of limits.
Short-term borrowings represent loans provided by commercial banks with an interest rate of 5.78%.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Due to the State and State institutions | 11,618 | 11,060 |
| Amounts due to employees | 10,174 | 8,624 |
| Liabilities arising from the share in results | - | 28 |
| Other current liabilities | 6,796 ____ |
899 ____ |
| 28,588 ____ |
20,611 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Accrued tool expenses | 13,075 | 54,566 |
| Due to the State and State institutions | 256 | 372 |
| Other current liabilities | 339 ____ |
1,093 ____ |
| 13,670 ____ |
56,031 ____ |
The Company's gearing ratio, expressed as the ratio of net debt to equity, can be expressed as follows:
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Short-term borrowings | 280,555 | 239,963 |
| Long-term borrowings | 212,344 | 255,816 |
| Cash and cash equivalents | 7,806 ____ |
28,943 ____ |
| Net debt | 485,093 ____ |
466,836 ____ |
| Equity | 635,420 | 702,806 |
| Net debt-to-equity ratio | 76.34% | 66.42% |
| 31.12.2014 | 31.12.2013 | ||
|---|---|---|---|
| Financial assets | |||
| Loans and receivables | 407,130 | 378,032 | |
| Cash and cash equivalents | 7,806 | 28,943 | |
| Financial liabilities | |||
| Trade payables and other | 344,619 | 260,296 | |
| Borrowings | 492,899 | 495,779 |
At the reporting date there are no significant concentrations of credit risk for loans and receivables designated at fair value through the statement of comprehensive income. Receivables and liabilities toward Government are not included in stated amounts.
The Treasury function of the Group provides services to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Company through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include market risk (including currency risk, fair value interest rate risk and price risk), credit risk, liquidity risk and cash flow interest rate risk.
The Company seeks to minimize the effects of these risks. The Group uses hedging instruments to hedge its exposure to currency risk on a part of the borrowings.
The largest markets on which the Group provides its services and sells its products comprise the EU market and the market of the Russian Federation. The management determines the prices of its products separately for domestic and foreign markets by reference to the market prices.
Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates relative to the interest rate, which applies to the financial instrument. Interest rate cash flow risk is the risk that the interest cost of an instrument will fluctuate over time. The interest rate risk exposure is low, as there are no financial instruments at variable rates.
The Group is exposed to credit risk through loans and trade receivables. Loans are granted to its subsidiaries and as such credit risk is under the control of the Company. Trade receivables are presented net of allowance for bad and doubtful accounts.
The five largest customers of the Company are Revoz Slovenia; Visteon Germany, OAO Avtovaz Russia, Peugeot Citroen Automobiles France and Renault France. Revenues generated by the sales to these business partners represent 87 percent of the total sales.
It is the policy of the Group to transact with financially sound companies where there is minimized risk of collection.
The Group undertakes certain transactions denominated in foreign currencies and is exposed to exchange rate fluctuations. The carrying amounts of the Group's foreign-currency denominated monetary assets and monetary liabilities at the reporting date are provided in the table below using exchange rates of the Croatian National Bank:
| At 31 December | |||||||
|---|---|---|---|---|---|---|---|
| Assets | Liabilities | Net position | |||||
| 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | ||
| EUR | 185,189 | 139,524 | 509,896 | 401,300 | (324,707) | (261,776) | |
| RUR | 103,993 | 130,594 | 43,696 | 86,361 | 60,297 | 44,233 | |
| RSD | 24,496 | 7,595 | 2,290 | 3,215 | 22,206 | 4,380 | |
| USD | 649 | 395 | 792 | 107 | (143) | 288 | |
| RON | - | 2,555 | - | - | - | 2,555 | |
| GBP | - | 47 | 157 | 62 | (157) | (15) | |
| CHF | - | - | - | - | - | - | |
| JPY | - | - | - | 4 | - | (4) | |
| 314,327 | 280,710 | 556,831 | 491,049 | (242,504) | (210,339) |
The Group is mainly exposed to the countries using EUR and RUR as their currency. The following table analyzes Group's sensitivity to exchange rate reduction of 2% compared to the € and the reduction of the exchange rate of 10% compared to RURU in 2014 and 2013. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year-end. A negative number below indicates a decrease in profit and a positive number below indicates an increase in profit where the Croatian kuna changes against the relevant currency for the percentage specified above.
| EUR impact | |||
|---|---|---|---|
| 2014 | 2013 | ||
| Change in exchange differences (2%) | +/- 4,445 | +/- 39,987 | |
| RUR impact | |||
| 2014 | 2013 | ||
| Change in exchange differences (10%) | +/- 6,166 | +/- 11,730 |
Ultimate responsibility for liquidity risk management rests with the Management Board. The Group manages its liquidity using banking facilities (overdrafts) and by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.
The following tables detail the Group's remaining contractual maturity for its non-derivative financial assets and liabilities. The tables have been drawn up based on the undiscounted cash flows of financial assets and liabilities based on the earliest date on which the Group can require payment i.e. can be required to pay.
| Up to 1 month |
1 to 3 months |
3 months to 1 year |
1 to 5 years |
Over 5 years |
Total | ||
|---|---|---|---|---|---|---|---|
| 2014 | Average interest rate |
||||||
| Assets | |||||||
| Non-interest bearing | 21,293 | 41,741 | 191,071 | - | 92,666 | 346,741 | |
| Interest bearing | 11.56% | 225 ___ |
11,780 ___ |
4,471 ___ |
49,671 __ |
2,018 __ |
68,165 ___ |
| 21,518 ___ |
53,521 ___ |
195,542 ___ |
49,671 _ |
94,684 _ |
414,936 ___ |
||
| Liabilities | _ | _ | |||||
| Non-interest bearing | 38,726 | 19,713 | 237,927 | 48,253 | - | 344,619 | |
| Interest bearing | 6.48% | 4,557 ___ |
51,697 ___ |
242,139 ___ |
151,649 _ |
42,857 __ |
492,899 ___ |
| 43,283 ___ |
71,410 ___ |
480,066 ___ |
199,902 _ |
42,857 ________ |
837,518 ___ |
||
| 2013 | |||||||
| Assets | |||||||
| Non-interest bearing | 39,540 | 37,110 | 147,834 | - | 101,012 | 325,497 | |
| Interest bearing | 11.56% | 74 ___ |
- ___ |
19,776 ___ |
58,180 _ |
3,448 _ |
81,478 ___ |
| 39,614 ___ |
37,110 ___ |
167,610 ___ |
58,180 __ |
104,460 __ |
406,975 ___ |
||
| Liabilities | _ | _ | |||||
| Non-interest bearing | 33,756 | 20,034 | 119,471 | 87,035 | - | 260,296 | |
| Interest bearing | 6.48% | 3,780 ___ |
53,819 ___ |
189,769 ___ |
223,768 __ |
24,643 __ |
495,779 ___ |
| 37,536 ___ |
73,853 ___ |
309,240 ___ |
310,803 ________ |
24,643 ________ |
756,075 ___ |
||
Financial instruments held to maturity in the ordinary course of business are carried at the lower of cost and net amount less repaid portion.
The fair value represents the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm's length transaction, except in the event of a forced sale or liquidation. The fair value of a financial instrument is its quoted market price, or the amount obtained using the discounted cash flow method.
At 31 December 2014, the carrying amounts of cash, receivables, short-term liabilities, accrued expenses, short-term borrowings and other financial instruments approximate their fair values due to the short-term maturity of these financial instruments and liabilities.
From December 31st, 2014 no business events or transactions have incurred that could have a significant impact on the financial statements as at and for the period then ended, or that are of such importance to the Company that would require disclosure in the notes to the financial statements.
According to estimates made by Group's Management Board, as at December 31st. 2014 the Group has no significant contingent liabilities that would require disclosure in the notes to the financial statements.
As at December 31st, 2014 no significant litigation has been conducted against the Group in which the failure is expected and which has not been presented in the financial statements.
These financial statements were approved by the Management Board of AD Plastik d.d. and authorized for issue on 23 April 2015.
For AD Plastik d.d. Solin:
Marinko Došen President of the Management Board
AD Plastik d.d., Solin Unconsolidated financial statements and Independent Auditor's Report For the year ended 31 December 2014
| Responsibility for the financial statements | 1 |
|---|---|
| Independent Auditor's Report | 2-3 |
| Unconsolidated statement of comprehensive income | 4 |
| Unconsolidated statement of financial position | 5-6 |
| Unconsolidated statement of changes in shareholders' equity | 7-8 |
| Unconsolidated statement of cash flows | 9-10 |
| Notes to the unconsolidated financial statements | 11-57 |
Pursuant to the Croatian Accounting Act, the Management Board is responsible for ensuring that financial statements are prepared for each financial year in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union, which give a true and fair view of the state of affairs and results of AD Plastik d.d. Solin ("the Company") for that period.
After making enquiries, the Board has a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. For this reason, the Board continues to adopt the going concern basis in preparing the financial statements.
In preparing those financial statements, the responsibilities of the Board include ensuring that:
The Board is responsible for keeping proper accounting records, which disclose with reasonable accuracy at any time the financial position of the Company and must also, ensure that the financial statements comply with the Croatian Accounting Act. The Board is also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Signed on behalf of the Management by:
Marinko Došen,
President of the Management Board
AD Plastik d.d., Solin Matoševa 8 21210 Solin Republic of Croatia
23 April 2015
We have audited the accompanying financial statements of AD Plastik d.d., Solin ("the Company") which comprise the balance sheet as at 31 December 2014, and the income statement for the year than ended, statement of changes in equity and statement of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes.
Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of unconsolidated financial statements that are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the unconsolidated financial statements. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the unconsolidated financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the unconsolidated financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
| Notes | 2014 | 2013 | |
|---|---|---|---|
| Sales | 6 | ||
| Other income | 7 | 598,399 16,296 |
525,513 15,098 |
| Total income | ____ 614,695 |
____ 540,611 |
|
| Increase in the value of work in progress and finished products | ____ 3,573 |
____ 2,996 |
|
| Cost of raw material and supplies | 8 | (270,684) | (203,004) |
| Cost of goods sold | 9 | (53,247) | (49,053) |
| Service costs | 10 | (44,176) | (32,521) |
| Staff costs | 11 | (112,557) | (102,774) |
| Depreciation and amortization | 12 | (33,301) | (30,002) |
| Other operating expenses | 13 | (82,418) | (96,804) |
| Provisions for risks and charges | 14 | (3,399) | (2,652) |
| Impairment of financial assets | 15 | (36,777) ____ |
- ___ |
| Total operating expenses | (632.986) ____ |
(513,814) ____ |
|
| Profit from operations | (18,291) ____ |
26,797 ____ |
|
| Finance revenue | 16 | 64,007 | 50,333 |
| Finance cost | 17 | (32,848) ____ |
(34,700) ____ |
| Profit from financing activities | 31,159 ____ |
15,633 ____ |
|
| Profit before taxation | 12,868 ____ |
42,430 ____ |
|
| Income tax expense | 18 | (144) ____ |
90 ____ |
| Profit for the year | 12,724 ____ |
42,520 ____ |
|
| Other comprehensive income, net | 19 | (32,707) | - |
| Total comprehensive income | (19,983) ____ |
42,520 ____ |
|
| Total comprehensive income per share (in kunas and lipas) | 20 | 3.05 | 10.22 |
| Notes | 31.12.2014 | 31.12.2013 | 01.01.2013 | |
|---|---|---|---|---|
| ASSETS | (restated) | (restated) | ||
| Non-current assets | ||||
| Intangible assets | 21 | 95,025 | 58,818 | 38,716 |
| Tangible assets | 22 | 518,082 | 500,585 | 426,153 |
| Investments in subsidiaries and associates | 23 | 96,352 | 133,464 | 131,134 |
| Other financial assets | 24 | 135,830 | 97,894 | 89,230 |
| Long-term receivables | 25 | 193,060 | - | - |
| Deferred tax assets | 18 | 8,575 ____ |
530 ____ |
441 ____ |
| Total non-current assets | 1,046,924 ____ |
791,291 ____ |
685,674 ____ |
|
| Current assets | ||||
| Inventories | 26 | 56,882 | 37,351 | 30,973 |
| Trade receivables | 27 | 175,094 | 211,782 | 183,243 |
| Other receivables | 28 | 33,978 | 48,079 | 57,637 |
| Current financial assets | 29 | 18,856 | 87,908 | 38,633 |
| Cash and cash equivalents | 30 | 1,801 | 14,531 | 7,255 |
| Prepaid expenses and accrued income | 31 | 62,507 ____ |
119,103 ____ |
102,145 ____ |
| Total current assets | 349,118 ____ |
518,754 ____ |
419,886 ____ |
|
| TOTAL ASSETS | 1,396,042 ____ |
1,310,045 ____ |
1,105,560 ____ |
At 31 December 2014
(All amounts are expressed in thousands of kunas)
| Notes | 31.12.2014 | 31.12.2013 (restated) |
01.01.2013 (restated) |
|
|---|---|---|---|---|
| Equity | ||||
| Share capital | 32 | 419,958 | 419,958 | 419,958 |
| Reserves | 192,627 | 214,863 | 205,542 | |
| Profit for the year | 12,724 ____ |
42,520 ____ |
44,767 ____ |
|
| Total equity | 625,309 ____ |
677,341 ____ |
670,267 ____ |
|
| Long-term provisions | 33 | 1,990 | 2,652 | 2,201 |
| Long-term borrowings | 34 | 201,208 ____ |
204,716 ____ |
110,180 ____ |
| Total non-current liabilities | 203,198 ____ |
207,368 ____ |
112,381 ____ |
|
| Advances received | 35 | 55,988 | 77,518 | 103,843 |
| Trade payables | 36 | 223,828 | 107,695 | 76,351 |
| Short-term borrowings | 37 | 258,000 | 207,325 | 124,975 |
| Other current liabilities | 38 | 12,525 | 8,956 | 8,629 |
| Short-term provisions | 33 | 6,917 | 5,509 | 7,458 |
| Accrued expenses and deferred income | 39 | 10,277 ____ |
18,333 ____ |
1,656 ____ |
| Total current liabilities | 567,535 ____ |
425,336 ____ |
322,912 ____ |
|
| Total liabilities | 770,733 ____ |
632,704 ____ |
435,293 ____ |
|
| TOTAL EQUITY AND LIABILITIES | 1,396,042 ____ |
1,310,045 ____ |
1,105,560 ____ |
| S ha re ita l ca p |
Ca ita l p res erv es |
Le l g a res erv es |
Ge l ne ra res erv es |
Re se rve s fro he t m lua i t rev a on ( i co nv ers ) on |
Re se rve s fro he t m lua i t rev a f on o ib le tan g fix d e ts as se |
Re se rve s on lua i t rev a f on o lon g ter m iva b l rec e es |
Re se rve s for ow n ha s res |
Tre as ury ha s res |
Re ine d ta rni ea ng s |
To l ta |
|
|---|---|---|---|---|---|---|---|---|---|---|---|
| Ba lan 31 at ce De mb 20 12 ce er - ini ia lly d t sta te |
41 9, 95 8 |
18 3, 20 76 |
6, 12 9 |
14 6 9 3 , |
8, 49 0 |
1, 6 9 6 |
- | 4, 27 6 |
( 4, 27 6 ) |
44 76 7 , |
67 8, 8 0 9 |
| Co ion f ct rre o lts for he t res u iou p rev s y ea rs Ba lan 31 at ce |
- | - | - | ( 8, 54 2) |
- | - | - | - | - | - | ( 8, 54 2) |
| De mb 20 12 ce er - d sta te as re |
41 9, 95 8 |
18 3, 07 6 |
6, 12 9 |
6, 15 1 |
8, 49 0 |
1, 6 9 6 |
- | 4, 27 6 |
( ) 4, 27 6 |
44 76 7 , |
67 0, 26 7 |
| Div ide nd id s p a Th d istr ibu ion t e |
- | - | - | ( 34 7) |
- | - | - | - | - | ( 33 27 4) , |
( 33 62 1) , |
| f t he fit art p o p ro fro 20 12 m |
- | - | - | 11 49 3 , |
- | - | - | - | - | ( 11 49 3 ) , |
- |
| Va lua ion f o t o wn S ha res Dis ibu ion tr t s t |
- | - | - | - | - | - | - | 78 7 |
( 78 7) |
- | - |
| o loy in em p ee s ha s res Co ion f ct |
- | - | - | 31 0 |
- | - | - | ( 31 0 ) |
31 0 |
- | 31 0 |
| rre o wit hh ld ing ta o x ( No .) te 4.1 |
- | - | - | ( 2, 135 ) |
- | - | - | - | - | - | ( 2, 135 ) |
| Pro fit for he t y ea r |
- | - | - | - | - | - | - | - | - | 42 52 0 , |
42 52 0 , |
| Ba lan 31 at ce De mb 20 13 ce er – d sta te as re |
9, 95 8 41 |
18 3, 07 6 |
6, 12 9 |
2 15 47 , |
8, 49 0 |
6 9 6 1, |
- | 3 4, 75 |
( 3 ) 4, 75 |
42 20 5 , |
67 34 7, 1 |
| S 3 1 De be ta tu t s a ce m r 2 0 1 3 - d ta te re s |
41 9, 95 8 |
18 3, 07 6 |
6, 12 9 |
15 47 2 , |
8, 49 0 |
1, 6 9 6 |
- | 4, 75 3 |
( 4, 75 3 ) |
42 5 20 , |
67 7, 34 1 |
|---|---|---|---|---|---|---|---|---|---|---|---|
| D iv i de ds i d n p a |
- | - | - | - | - | - | - | - | - | ( ) 33 34 3 , |
( ) 33 34 3 , |
| T he d is i bu ion f tr t t o p ar he f i fro 2 0 1 3 t t p ro m |
- | - | - | 9, 17 7 |
- | - | - | - | - | ( 9, 17 7) |
- |
| Va lua ion f o ha t o wn s res |
- | - | - | - | - | - | - | ( 1, 80 8 ) |
1, 80 8 |
- | - |
| Re lua ion t va re se rve ( ds ice ) tc. g oo se rv s, e , |
- | - | - | - | - | - | ( ) 32 68 6 , |
- | - | - | ( ) 32 68 6 , |
| Sa le f o ha o wn s res |
- | - | - | 1, 27 3 |
- | - | - | - | - | - | 1, 27 3 |
| Pr f i fo he t t o r y ea r |
- | - | - | - | - | - | - | - | - | 12 72 4 , |
12 72 4 , |
| Ba lan 3 1 t ce a De be 2 0 1 4 ce m r |
41 9, 95 8 |
18 3, 07 6 |
6, 12 9 |
25 9 22 , |
8, 49 0 |
1, 6 9 6 |
( 3 2, 6 8 6 ) |
2, 94 5 |
( 2, 94 5 ) |
12 72 4 , |
6 25 3 0 9 , |
| Cash flows from operating activities | 31.12.2014 | 31.12.2013 |
|---|---|---|
| Profit for the year | 12,724 | 42,520 |
| Adjusted: | ||
| Income tax expense | 144 | (90) |
| Depreciation and amortization of plant, equipment and intangible assets | 33,301 | 30,002 |
| Increase in deferred tax assets | (8,358) | - |
| Increase in deferred tax liabilities | 169 | - |
| Impairment of investments in subsidiaries | 37,113 | - |
| Net book value of disposed assets | 333 | 29,531 |
| Interest expense | 20,692 | 21,154 |
| Interest income | (14,307) | (8,988) |
| Impairment of receivables, net | (1,795) | (1,658) |
| Increase/(decrease) in long-term and short-term provisions | 746 ____ |
(1,498) ____ |
| Profit from operations before working capital changes | 80,762 ____ |
110,973 ____ |
| Increase in inventories | (19,531) | (6,378) |
| Increase in trade receivables | (118,211) | (26,881) |
| Decrease/(increase) in other receivables | 26,189 | (3,340) |
| Increase in trade payables | 116,133 | 31,344 |
| Decrease in advances received | (21,530) | (26,325) |
| Decrease in other current liabilities | (35) | (2,024) |
| (Decrease)/increase in accrued expenses and deferred income | (8,056) | 16,677 |
| Decrease / (increase) in prepaid expenses | 56,596 | (16,958) |
| Interest paid | (20,657) | (20,938) |
| Cash generated from operations | 91,660 ____ |
56,134 ____ |
| Investments in subsidiaries | - | (2,330) |
| Interest received | 5,788 | 21,885 |
| Purchases of property, plant and equipment, and intangible assets | (87,339) | (154,067) |
| Received short term loans, net | - | (4,455) |
| Received long term loans, net | (37,936) ____ |
(53,482) ____ |
| Cash used in investing activities | (119,487) ____ |
(192,449) ____ |
| 2014 | 2013 | |
|---|---|---|
| Cash flows from financing activities | ||
| Purchase of own shares | 1,272 | - |
| Bonuses to employees | - | 310 |
| Dividends paid | (33,342) | (33,621) |
| Received long-term loans | 75,941 | 179,677 |
| Received short-term loans | 136,656 | 108,167 |
| Proceeds from borrowings | (85,981) | (25,817) |
| Repayment of borrowings | (79,449) | (85,141) |
| Cash in flow from financing activities | 15,097 ____ |
143,575 143,575 ____ |
| Net cash flow for the year | (12,730) ____ |
7,276 ____ |
| At 1 January | 14,531 | 7,255 |
| Net cash (outflow) /inflow | (12,730) | 7,276 |
| At 31 December | 1,801 ____ |
14,531 ____ |
The accompanying accounting policies and notes form an integral part of these unconsolidated financial
statements.
The company AD Plastik d.d., Solin, a public limited company for the production of motor vehicle spare parts and accessories and of plastic masses (abbreviated firm: AD PLASTIK d.d.), was established by a decision of the Founding Assembly dated 15 June 1994 following the transformation of the socially-owned entity Autodijelovi – Solin pursuant to the decision on the transformation of ownership and the Decision of the Croatian Privatization Fund No. 01-02/92-06/392 of 6 December 1993. The Company is the legal successor of the socially-owned entity Autodijelovi and, according to the decision of the Commercial Court in Split No. Fi 6215/94 of 28 June 1994, assumed all of its assets and liabilities at the date of registration in the court register. By decision of the General Shareholders' Assembly dated 21/06/2007, the Statute of the Company of 8 July 2004 was amended and a decision was made to increase the share capital of the Company in cash. Pursuant to the Decision No. Tt-07/2145-3 of 25/09/2007, the increase of the share capital by HRK 125,987,500.00, effected by OAO Saint Petersburg Investment Company (Sankt-Peterburške investicijske kompanije, OAO SPIK) was registered, and the total subscribed capital now amounts to HRK 419,958,400.00 and consists of 4,199,584 shares, with a nominal amount of HRK 100.00 each. By the Share Transfer Agreement of 29 June 2009 OAO Spik transferred the shares of the AD Plastik d.d. to OAO Group Aerokosmicheskoe Oborudovanie, St. Petersburg, which transferred those shares to OAO HAK, Sankt Petersburg, which on August 04th, 2011 transferred shares to OAO HAK from Sankt Petersburg.
The Company shares were included in the listing of public limited companies on the Official Market of the Zagreb Stock Exchange on 1 October 2010.
The primary activity of the Company comprises manufacture of motor vehicle spare parts and accessories. The registered activities of the Company comprise the following:
providing advice, guidance and operational assistance to legal entities;
designing of accounting systems, materials accounting software, budgeting control procedures;
At 31 December 2014, the number of staff employed was 1,283 ( 31 December 2013: 894).
| Mandate | ||||
|---|---|---|---|---|
| Members of the Supervisory Board: | ||||
| Josip Boban (Chairman) | From 19 July 2012 | To 19 July 2016 | ||
| Nikola Zovko (Deputy Chairman) | From 19 July 2012 | To 19 July 2016 | ||
| Marijo Grgurinović | From 14 July 2011 | To 14 July 2015 | ||
| Igor Anatoljevič Solomatin | From 14 July 2011 | To 14 July 2015 | ||
| Drandin Dmitrij Leonidovič | From 19 October 2011 | To 19 October 2015 | ||
| Nikitina Nadežda Anatoljevna | From 19 October 2011 | To 19 October 2015 | ||
| Mladen Peroš (President) | From 19 July 2012 | To 5 Februrary 2015 |
|---|---|---|
| Mladen Peroš (member) | From 6 Februrary 2015 | To 19 July 2016 |
| Marinko Došen (President) | From 6 Februrary 2015 | To 19 July 2016 |
| Ivica Tolić | From 19 July 2012 | To 19 July 2016 |
| Katija Klepo | From 19 July 2012 | To 19 July 2016 |
| Denis Fusek | From 26 September 2013 | To 19 July 2016 |
| Hrvoje Jurišić | From 26 September 2013 | To 19 July 2016 |
The following amendments to the existing standards issued by the International Accounting Standards Board and interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC) that are adopted by European Union are effective for the current period:
The adoption of these amendments to existing standards, revisions and interpretations has not led to any changes in accounting policies nor has affected the Company's profit in the current or previous year.
Standards and Interpretations in issue not yet adopted
IFRSs currently adopted by the EU do not differ significantly from the rules set by the International Accounting Standards Board ("IASB"), except for the following standards, amendments to standards and interpretations whose adoption by the EU 23 April 2015 has not yet been decided:
The Entity anticipates that the adoption of these standards, revisions and interpretations will have no material impact on the financial statements of the Entity in the period of initial application.
Set out below are the principal accounting policies consistently applied in the preparation of the financial statements for the current and prior years.
These financial statements are prepared in accordance with the Accounting Act of the Republic of Croatia and International Financial Reporting Standards (IFRS) that were adopted by Europen Union.
The Company maintains its accounting records in the Croatian language, in Croatian kuna and in accordance with Croatian law and the accounting principles and practices observed by enterprises in Croatia.
The preparation of the financial statements in accordance with the Accounting Act of the Republic of Croatia and International Financial Reporting Standards ('IFRSs') that are adopted in Europen Union, requires from management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. These estimates are based on the information available as at the date of preparation of the financial statements, and actual results could differ from those estimates.
The financial statements of the Company represent aggregate amounts of assets, liabilities, capital and reserves of the Company as of 31 December 2014, and the results of operations for the year then ended. Consolidated financial statements AD Plastik d.d. and subsidiaries for the year ended 31 December 2014 have been issued on 23rd April 2015.
The Company also prepares its consolidated financial statements in accordance with International Financial Reporting Standards, which include the financial statements of the Company as the Parent and the financial statements of the subsidiaries controlled by the Company. In these financial statements, investments in entities controlled by the Company or in which the Company has significant influence are carried at cost less impairment if any. For a full understanding of the financial positions of the Company and its subsidiaries as a group, and the results of their operations and their cash flows for the year, users are advised to read the consolidated financial statements of the group AD Plastik d.d. ("the Group"). Details of the investments in subsidiaries and associates are presented in Note 23.
Revenue is measured at the fair value of the consideration received or receivable for products, goods or services sold in the regular course of operations.
Revenues are stated net of value added tax, estimated returns, discounts and rebates. Revenue is recognized when the amount of the revenue can be measured reliably and when future economic benefits are expected to flow into the Company.
Product sales are recognized when the products are delivered to, and accepted by the customer and when the collectability of the receivables is virtually certain.
Accrued revenues are tied to contracts that are specifically concluded contracts for creating an asset or group of assets which is closely linked and interdependent on the draft, technology and function or their final use or application. The Company is required to recognize income according to the stage of completion of contract activity. In accordance with IAS 11, when the result of contract on drafting can be estimated reliably, revenue and costs associated with the contract should be recognized according to the stage of completion of the contracted activities on the date of statement of financial position.
Interest income is recognized on a time basis, using the effective interest method. Interest earned on balances with commercial banks (demand and term deposits) is credited to income for the period as it accrues. Interest on trade debtors is recognized as income upon settlement.
Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization.
All other borrowing costs are included in profit or loss in the period in which they are incurred.
Transactions in foreign currencies are translated into Croatian kunas at the rates of exchange in effect at the dates of the transactions. Cash, receivables and payables denominated in foreign currencies are retranslated at the rates of exchange in effect at the date of the statement of financial position. Gains and losses arising on translation are included in the statement of comprehensive income for the year. At 31 December 2014, the official exchange rate of the Croatian kuna against 1 euro (EUR) was HRK 7.661471 (31 December 2013: HRK 7.637643 for EUR 1).
Income tax expense represents the sum of the tax currently payable and deferred tax. Income tax is recognized in the income statement, except where it relates to items recognized directly in equity, in which case it is also recognized in equity. Current tax represents tax expected to be paid on the basis of taxable profit for the year, using the tax rate enacted at the balance sheet date, adjusted by appropriate prior-period items.
Deferred tax is provided using the balance sheet liability method, providing for temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realized, based on tax rates in effect at the balance sheet date.
The measurement of deferred tax liabilities and assets reflects the amount that the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
Deferred tax liabilities and assets are not discounted and are classified in the balance sheet as non-current assets and/or non-current liabilities. Deferred tax assets are recognized only to the extent that it is probable that the related tax benefit will be realized. At each balance sheet date, the Company reviews the unrecognized potential tax assets and the carrying amount of the recognized tax assets.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the Company intends to settle its current tax assets and liabilities.
In the case of a business combination, the tax effect is taken into account in calculating goodwill or in determining the excess of the acquirer's interest in the net fair value of the acquiree's identifiable assets, liabilities and contingent liabilities over cost.
Tangible fixed assets are recognized initially at cost and subsequently at cost less accumulated depreciation. The initial cost of property, plant and equipment comprises its purchase price, including import duties and nonrefundable sales taxes and any directly attributable costs of bringing an asset to its working condition and location for its intended use. Maintenance and repairs, replacements and improvements of minor importance are expensed as incurred. Where it is obvious that expenses incurred resulted in increase of expected future economic benefits to be derived from the use of an item of tangible or intangible assets in excess of the originally assessed standard performance of the asset, they are added to the carrying amount of the asset. Gains or losses on the retirement or disposal of tangible fixed assets are included in the statement of comprehensive income in the period they occur. Depreciation commences on putting an asset into use. Depreciation is provided so as to write down the cost or revalued amount of an asset other than land, tangible and intangible assets in preparation, over the estimated useful life of the asset using the straight-line method as follows:
| Depreciation rates in 2014 | Depreciation rates in 2013 | |
|---|---|---|
| 2. Tangible assets | ||
| Buildings | 1.50 | 1.50 |
| Machinery | 7.00 | 7.00 |
| Tools, furniture, office and laboratory equipment and accessories, measuring and control instruments |
10.00 | 10.00 |
| Vehicles | 20.00 | 20.00 |
| IT equipment | 20.00 | 20.00 |
| Other | 10.00 | 10.00 |
| Projects | 20.00 | 20,00 |
At each reporting date the Company reviews the carrying amounts of its tangible and intangible assets to determine whether there is an indication that the assets may be impaired. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the Company estimates the recoverable amount of the cash-generating unit to which the asset belongs. Where a reasonable and consistent basis of allocation can be identified, corporate assets are also allocated to individual cash-generating units, or otherwise they are allocated to the smallest group of cash-generating units for which a reasonable and consistent allocation basis can be identified.
An associate is an entity over which the Company has significant influence but which is neither a subsidiary nor a joint venture. In these financial statements, the results, assets and liabilities of subsidiaries are measured at cost.
An associate is an entity over which the Company has significant influence and share ownership from 20 to 50%, but not control. Significant influence is the power to participate in making decisions on the financial and operating policies of an entity in which the investment is made, but does not represent control or joint control over those policies. In these financial statements, the results of operations of associates are represented by equity method.
Inventories of raw material and spare parts are stated at the lower of cost and net realizable value. Cost is determined using the weighted-average cost method. Net realizable value represents the estimated selling price in the ordinary course of business less all variable selling costs.
Cost of work in progress and finished products comprises the cost of raw material and supplies, direct labor and other costs and the portion of overheads directly attributable to work in progress.
Small inventory is written off when put in use.
The cost of product inventories i.e. the production costs is based on direct material used, the cost of which is determined using the weighted average cost method, then direct labor costs, and fixed overheads at the actual level of production which approximates the normal capacities, as well as variable overheads that are based on the actual use of the production capacities.
Merchandise on stock is recognized at purchase cost.
Trade debtors and prepayments are carried at nominal amounts less an appropriate allowance for impairment for uncollectible amounts.
Impairment is made whenever there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, the probability of bankruptcy proceedings at the debtor, or default or delinquency in payment are considered objective evidence of impairment. The amount of the impairment loss is determined as the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate.
Management provides for doubtful receivables based on a review of the overall ageing of all receivables and a specific review of significant individual amounts receivable with individual approach to strategic buyers of ADP Group and according the age structure of other current receivables. The allowance for amounts doubtful of collection is charged to the statement of comprehensive income for the year.
Cash comprises account balances with banks, cash in hand, deposits and securities at call or with maturities of less than three months.
Provisions are recognized when the Company has a present obligation (legal or constructive) as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.
Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. Where the effect of discounting is material, the amount of the provision is the present value of the expenditures expected to be required to settle the obligation, determined using the estimated risk free interest rate as the discount rate. Where discounting is used, the reversal of such discounting in each year is recognized as a financial expense and the carrying amount of the provision increases in each year to reflect the passage of time.
The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the date of the statement of financial position, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.
In the normal course of business the Company makes payments, through salary deductions, to mandatory pension funds on behalf of its employees as required by law. All contributions made to the mandatory pension funds are recorded as salary expense when incurred. The Company does not have any other retirement benefit plan and, consequently, has no other obligations in respect of the retirement benefits for its employees. In addition, the Company is not obliged to provide any other post-employment benefits.
Termination benefits are payable when employment is terminated by the Company before the normal retirement date. The Company recognizes its termination benefit obligations in accordance with the applicable Union Agreement.
Benefits falling due more than 12 months after the reporting date are discounted to their present value.
For defined benefit retirement benefit plans, the cost of providing benefits is determined using the Projected Unit Credit Method, with actuarial valuations being carried out at each reporting date. Actual gains and losses are recognized in the period in which they arise.
Past service cost is recognized immediately to the extent that the benefits are already vested. Otherwise, it is amortized on a straight-line basis over certain period until the benefits become vested.
Financial assets and financial liabilities included in the accompanying financial statements consist of cash and cash equivalents, marketable securities, trade and other receivables, trade and other payables, long-term receivables, loans, borrowings and investments. The details of the recognition and measurement of those items are presented in the corresponding policies.
Investments are recognized and derecognized on a trade date where the purchase or sale of an investment is under a contract whose terms require delivery of the investment within the timeframe established by the market concerned, and are initially measured at fair value, net of transaction costs, except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value.
The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.
Trade receivables, loans, and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as loans and receivables. Loans and receivables are measured at amortized cost using the effective interest method, less any impairment. Interest income is recognized by applying the effective interest rate, except for short-term receivables when the recognition of interest would be immaterial.
The effective interest method is a method of calculating the amortized cost of a financial asset or liability, and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial asset or liability, or, where appropriate, a shorter period.
Financial assets are assessed for indicators of impairment at each date of the statement of financial position. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been impacted. For financial assets carried at amortized cost, the amount of the impairment is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate.
The carrying amount of a financial asset is reduced through the use of an allowance account. When a trade receivable is uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account.
The Company derecognizes a financial asset only when the contractual rights to the cash flows from the asset expire; or it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. If the Company neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Company recognizes its retained interest in the asset and an associated liability for amounts it may have to pay. If the Company retains substantially all the risks and rewards of ownership of a transferred financial asset, the Company continues to recognize the financial asset and also recognizes a collateralized borrowing for the proceeds received.
Debt and equity instruments are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangement.
An entity may have a monetary item that is receivable or liability towards the foreign entity. An item for which settlement is neither planned nor likely to occur in the foreseeable future, is essentially part of the entity's net investment in a foreign operation and according to accounting is accounted for in accordance with IAS 21 The company initially recognizes foreign exchange differences arising from monetary items that are part of the net foreign investments within other comprehensive income and accumulates in a separate component of equity revaluation reserves.
During sale of the net investment in a foreign operation, the total amount of foreign exchange losses is transferred from equity to profit or loss (as a reclassification adjustment). This is applied from January 01st, 2014.
Contingent liabilities have not been recognized in these financial statements. They are not disclosed unless the possibility of outflow of resources embodying economic benefits is remote. A contingent asset is not recognized in the financial statements but it is disclosed when the inflow of economic benefits becomes probable.
Events after the date of the statement of financial position that provide additional information about the Company's position at that date (adjusting events) are reflected in the financial statements. Post-year-end events that are not adjusting events are disclosed in the notes when material.
In the application of the Company's accounting policies, which are described in Note 3, the directors are required to make judgments, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on past experience and other factors that are considered to be relevant. Actual results may differ from those estimates.
The estimates and underlying assumptions are continually reviewed. Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of revision and future periods if the revision affects both current and future periods.
Areas of estimation include, but are not limited to, depreciation periods and residual values of property, plant and equipment, and of intangible assets, value adjustment of inventories, impairment of receivables, and litigation provisions. The key areas of estimation in applying the Company's accounting policies that had a most significant impact on the amounts recognized in the financial statements were as follows:
As described in the Note 3.7, the Company reviews the estimated useful lives of property, plant and equipment at the end of each annual reporting period. Property, plant and equipment are recognized initially at cost, less accumulated depreciation.
A deferred tax asset is recognized only to the extent that it is probable that the related tax benefit will be realized. In determining the amount of deferred taxes that can be recognized significant judgments are required, which are based on the probable quantification of time and level of future taxable profits, together with the future tax planning strategy. In 2014, deferred tax assets on available tax differences were recognized.
Management provides for doubtful receivables based on a review of the overall ageing of all receivables and a specific review of significant individual amounts receivable. The allowance for amounts doubtful of collection is charged to the statement of comprehensive income for the year.
The cost of defined benefits is determined using actuarial estimates. Actuarial estimates involve assumptions about discount rates, future salary increases and the mortality or fluctuation rates. Because of the long-term nature of those plans, there is uncertainty surrounding those estimates.
Segment revenue analysis by country:
| 2014 | 2013 | |
|---|---|---|
| Slovenia | 269,934 | 223,171 |
| Germany | 121,469 | 92,816 |
| Russia | 80,149 | 101,164 |
| France | 56,606 | 52,058 |
| Czech Republic | 26,524 | 15,148 |
| Others | 43,717 ____ |
41,156 ____ |
| 598,399 ____ |
525,513 ____ |
| 2014 | 2013 | |
|---|---|---|
| Foreign sales | 588,846 | 511,523 |
| Domestic sales | 9,553 ____ |
13,990 ____ |
| 598,399 ____ |
525,513 ____ |
| 2014 | 2013 | |
|---|---|---|
| Income from bonuses provided by suppliers | 2,222 | 1,534 |
| Income from reversal of provisions for long-service benefits | 1,568 | 1,421 |
| Income from consumption of own products, goods and services | 1,377 | 1,116 |
| Income from co-financing | 1,095 | - |
| Income from reversal of retirement benefit provisions | 1,084 | 780 |
| Income from damages collected | 622 | 118 |
| Income from refunds under the tax decision | - | 4,431 |
| Income from reversal of vacation accruals for unused vacation days | 100 | |
| Other operating income | 8,328 ____ |
5,598 ____ |
| 16,296 ____ |
15,098 ____ |
| 2014 | 2013 | |
|---|---|---|
| Direct materials | 133,091 | 95,598 |
| Indirect materials | 107,312 | 77,831 |
| Electricity | 13,699 | 10,914 |
| Direct packaging | 10,216 | 8,879 |
| Preventive maintenance of machinery | 1,817 | 1,527 |
| Gas for heating in the production process | 1,604 | 1,413 |
| Other materials | 1,191 | 835 |
| Regular maintenance of machinery | 1,115 | 511 |
| Other expenses | 639 ____ |
5,496 ____ |
| 270,684 ____ |
203,004 ____ |
Cost of goods sold in the amount of HRK 53,247 thousand (2013: HRK 49,053 thousand) relate in major part on purchase cost of tools, equipment and material for start up of new production and projects in subsidiaries.
| 2014 | 2013 | |
|---|---|---|
| Re-export costs | 21,789 | 35,909 |
| Cost of merchandise | 15,182 | 5,297 |
| Cost of direct material sold | 13,349 | 6,113 |
| Cost of spare parts sold | 982 | 1,298 |
| Other costs of goods sold | 1,945 ____ |
436 ____ |
| 53,247 ____ |
49,053 ____ |
| 2014 | 2013 | |
|---|---|---|
| Transport | 26,306 | 15,973 |
| Rental costs | 5,963 | 5,457 |
| Regular and preventive maintenance costs - machinery | 3,041 | 3,115 |
| Tool modification costs | 1,219 | 503 |
| Telecommunications and information systems | 1,104 | 990 |
| Communal fees | 1,000 | 638 |
| Regular and preventive maintenance costs - buildings | 849 | 656 |
| Water supply | 678 | 900 |
| Forwarding and shipping costs | 575 | 339 |
| Know-how costs | 51 | 111 |
| Other expenses | 3,390 ____ |
3,839 ____ |
| 44,176 ____ |
32,521 ____ |
| 2014. | 2013. | |
|---|---|---|
| Net wages and salaries | 58,763 | 54,269 |
| Taxes and contributions out of salaries | 24,484 | 22,612 |
| Contributions on salaries | 14,691 | 13,567 |
| Other staff costs | 14,619 ____ |
12,326 ____ |
| 112,557 ____ |
102,774 ____ |
Other staff costs comprise per diems, overnight accommodation costs and business travel costs, reimbursement of a transportation costs to work and other business related costs.
| 2014 | 2013 | |
|---|---|---|
| Depreciation (note 22) | 25,225 | 22,539 |
| Amortization (note 21) | 8,076 ____ |
7,463 ____ |
| 33,301 ____ |
30,002 ____ |
| 2014 | 2013 | |
|---|---|---|
| Temporary service costs - tools | 55,217 | 75,092 |
| Professional service cost | 4,038 | 5,739 |
| Other non-material expenses | 3,492 | 1,895 |
| Insurance premiums | 1,537 | 1,895 |
| Communal fees for the use of construction plots | 1,526 | 1,337 |
| Payment operation charges | 1,399 | 822 |
| Bank charges | 1,103 | 820 |
| Customer complaints | 841 | 647 |
| Cost of goods provided free of charge | 762 | 622 |
| Entertainment | 552 | 233 |
| Professional training costs | 360 | 266 |
| Occupational Health and Safety service costs | 173 | 115 |
| Forest reproduction levies | 169 | 149 |
| Water management fee | 161 | 209 |
| Translation service costs | 40 | 81 |
| Other expenses | 11,048 ____ |
7,321 ____ |
| 82,418 ____ |
96,804 ____ |
| 2014 | 2013 | |
|---|---|---|
| Provisions under actuarial calculations | 1,990 | 2,652 |
| Vacation accruals, net | 1,039 | - |
| Litigation provisions, net | 370 ____ |
- ____ |
| 3,399 ____ |
2,652 ____ |
The Company has prepared the discounted cash flows of the subsidiary ADP Kaluga under which the impairment of the investment has been conducted to the amount of 36,777 thousand kuna.
| 2014 | 2013 | |
|---|---|---|
| Dividend income | 40,998 | 26,937 |
| Interest income | 14,307 | 8,988 |
| Foreign exchange gains | 7,973 | 14,408 |
| Other finance revenue | 729 ____ |
- ____ |
| 64,007 ____ |
50,333 ____ |
| 2014 | 2013 | |
|---|---|---|
| Interest expense | 20,692 | 21,154 |
| Foreign exchange losses | 11,773 | 13,546 |
| Other finance costs | 383 ____ |
- ____ |
| 32,848 ____ |
34,700 ____ |
Income tax comprises the following:
| 2014 | 2013 | |
|---|---|---|
| Current tax | (132) | 90 |
| Deferred tax | (12) ___ |
- ___ |
| (144) ___ |
90 ___ |
Deferred tax, as presented in the Statement of financial position, is as follows:
| 31/12/2014 | 31/12/2013 | |
|---|---|---|
| Balance at 1 January | 530 | 440 |
| Recognized deferred tax assets | 8,045 ___ |
90 ___ |
| Balance at 31 December | 8,575 ___ |
530 ___ |
Deferred tax assets arise from the following:
| 2014 | Opening balance |
Credited / (Charged) to statement of comprehensive income |
Closing balance |
|---|---|---|---|
| Temporary differences: | |||
| Provisions for long-service and termination benefits | 530 | (132) | 398 |
| Provisions from the translation of foreign currencies, net | - ___ |
8,177 ___ |
8,177 ___ |
| Balance at 31 December | 530 ___ |
8,045 ___ |
8,575 ___ |
| 2013 | Opening balance |
Credited / (Charged) to statement of comprehensive income |
Closing balance |
| Temporary differences: | |||
| Provisions for long-service and termination benefits | 440 ___ |
90 ___ |
530 ___ |
| Balance at 31 December | 440 ___ |
90 ___ |
530 ___ |
The relationship between the accounting profit and tax losses carried forward can be shown as follows:
| Profit for the year 12,868 ___ |
42,430 ___ |
|---|---|
| Effect of tax increase 44,331 |
4,972 |
| Effect of tax decrease (43,944) ___ |
(29,365) ___ |
| Tax base 13,255 ___ |
18,037 ___ |
| Tax at the rate of 20% 2,651 |
3,607 |
| Tax reliefs (2,507) ___ |
(3,607) ___ |
| Current tax liability 144 ___ |
(90) ______ ___ |
The income tax rate effective in the Republic of Croatia for the years 2014 and 2013 was 20%.
On 24 October 2012 the Company filed with the Ministry of Economy the Application for Incentive Measures for the investment project "Expansion of Production for the Purpose of Export of Car Industry Products", in accordance with the Act on Investment Promotion and Development of Investment Climate (OG 111/2012 and 28/2013) and the Investment Promotion and Development of Investment Climate (OG 40 of 5 April 2013).
As a result, the Company made investments in fixed assets during 2014, having thus met the prerequisites for the utilization of the tax incentives for 2014.
The Tax Office has not performed a supervision of the income tax returns of the Company. In accordance with tax regulations, the Tax Office may at any time inspect the books and records of the Company for a period of three years following the year in which the tax liability was reported and may impose additional tax assessments and penalties. Company's Management Board is not aware of any circumstances that could lead to potential material liabilities in this respect.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Status at the beginning of the year | - ___ |
- ___ |
| Exchange differences on translation of a foreign operations | (40,884) | - |
| Income tax at the exchange rate losses from translation of a foreign | ||
| operations | 8,177 ___ |
- ___ |
| Status at the end of the year | (32,707) ___ |
- ___ |
Basic earnings per share are determined, by dividing the Company's net profit by the weighted average number of ordinary shares in issue during the year, excluding the average number of ordinary shares redeemed and held by the Company as treasury shares.
| 2014 | 2013 | |
|---|---|---|
| Net profit attributable to the Company shareholders | 12,724 | 42,520 |
| Weighted average number of shares | 4,167,822 ___ |
4,161,822 ___ |
| Average weighted earnings per share (in kunas and lipas) | 3.05 ___ |
10.22 ___ |
| Licenses | Software | Projects | Total | |
|---|---|---|---|---|
| Cost | ||||
| Balance at 31 December 2012 | 55 | 1,120 | 130,293 | 131,468 |
| Additions | - | 4,303 | 34,248 | 38,551 |
| Disposals and retirements | - | - | (15,140) | (15,140) |
| Balance at 31 December 2013 | 55 ___ |
5,423 ___ |
149,401 ___ |
154,879 ___ |
| Additions | - ____ |
19 ____ |
44,264 ____ |
44,283 ____ |
| Balance at 31 December 2014 | 55 ____ |
5,442 ____ |
193,665 ____ |
199,162 ____ |
| Accumulated amortization | ||||
| Balance at 31 December 2012 | - | 865 | 91,887 | 92,752 |
| Charge for the year | - | 938 | 6,525 | 7,463 |
| Disposals and retirements | - | - | (4,154) | (4,154) |
| Balance at 31 December 2013 | - ___ |
1,803 ___ |
94,258 ___ |
96,061 ___ |
| Charge for the year | - ____ |
1,610 ____ |
6,466 ____ |
8,076 ____ |
| Balance at 31 December 2014 | - ____ |
3,413 ____ |
100,724 ____ |
104,137 ____ |
| Net book value | ||||
| At 31 December 2014 | 55 ___ |
2,029 ___ |
92,941 ___ |
95,025 ___ |
| At 31 December 2013 | 55 ___ |
3,620 ___ |
55,143 ___ |
58,818 ___ |
Projects comprise investments in the development of new products that are expected to generate revenue in future periods. Consequently, the costs are amortized over the period in which the related economic benefits flow into the Company.
| Land | Buildings | Plant and equipment |
Assets under constructi on |
Other | Total | |
|---|---|---|---|---|---|---|
| Cost Balance at 31 December 2012 |
139,976 | 227,886 | 315,787 | 12,594 | 2,562 | 698,805 |
| Transfer from assets under development |
- | 462 | 13,098 | 101,956 | - | 115,516 |
| Disposals and retirements | - | - | (10,177) | (15,880) | (647) | (26,704) |
| Balance at 31 December 2013 |
139,976 | 228,348 | 318,708 | 98,670 | 1,915 | 787,617 |
| Additions Transfer from assets under |
- | 150 | - | 42,423 | 483 | 43,056 |
| development | - | - | 77,422 | (77,422) | - | - |
| Disposals and retirements | - | - | (6,929) | - | - | (6,929) |
| Balance at 31 December 2014 |
139,976 | 228,498 | 389,201 | 63,671 | 2,398 | 823,744 |
| Accumulated depreciation Balance at 31 December 2012 |
- | 61,359 | 210,018 | - | 1,275 | 272,652 |
| Charge for the year | - | 3,418 | 18,889 | - | 232 | 22,539 |
| Disposals and retirements | - | - | (7,776) | - | (383) | (8,159) |
| Balance at 31 December 2013 |
- | 64,777 | 221,131 | - | 1,124 | 287,032 |
| Charge for the year | - | 3,426 | 21,632 | - | 167 | 25,225 |
| Disposals and retirements | - | - | (6,595) | - | - | (6,595) |
| Balance at 31 December 2014 |
- | 68,203 | 236,168 | - | 1,291 | 305,662 |
| Net book value | ||||||
| At 31 December 2014 | 139,976 | 160,295 | 153,033 | 63,671 | 1,107 | 518,082 |
| At 31 December 2013 | 139,976 | 163,571 | 97,577 | 98,670 | 791 | 500,585 |
The net book value of land and buildings pledged as collateral with commercial banks as of 31 December 2014 in the amount of HRK 362,504 thousand (31 December 2013: HRK 303,468 thousand), and the balance of shortterm and long-term borrowings covered by the collateral which amounts to HRK 303,989 thousand (2013: HRK 319,408 thousand).
The following are basic information about material subsidiaries at the end of the reporting period:
| Name of subsidiary | Principal activity | Country of incorporation and business |
Ownership interest in % | Amount of equity investment |
||
|---|---|---|---|---|---|---|
| 31.12.2014 | 31.12.2013 | 31.12.2014 | 31.12.2013 | |||
| AD PLASTIK d.o.o. | Manufacture of other vehicle spare parts and accessories Manufacture of other |
Novo Mesto, Slovenia |
100.00% | 100.00% | 58 | 204 |
| ZAO PHR | vehicle spare parts and accessories Manufacture of other |
Samara, Russian Federation |
99.95% | 99.95% | 5,069 | 5,069 |
| ZAO AD Plastik Kaluga |
vehicle spare parts and accessories Manufacture of other |
Kaluga, Russian Federation |
100.00% | 100.00% | 24,236 | 61,012 |
| ADP d.o.o. | vehicle spare parts and accessories |
Mladenovac, Serbia | 100.00% | 100.00% | 15,014 | 15,014 |
| 44,377 | 81,153 |
The following table shows the additional information about the subsidiaries that are partially owned by the Company, but in which the Company has significant material non-controlling interests:
| Name of associate | Principal activity | Country of incorporation and business |
Ownership interest in % | Amount of equity investment |
||
|---|---|---|---|---|---|---|
| 31.12.2014 | 31.12.2013 | 31.12.2014 | 31.12.2013 | |||
| EURO AUTO PLASTIC SYSTEMS FAURECIA AD PLASTIK ROMANIA |
Manufacture of other vehicle spare parts and accessories Manufacture of other vehicle spare parts and |
Mioveni, Romania | 50.00% | 50.00% | 21,755 | 21,755 |
| (FAAR) FAURECIA ADP |
accessories Manufacture of other vehicle spare parts and |
Mioveni, Romania | 49.00% | 49.00% | - | 336 |
| HOLDING | accessories | Nanterre, France | 40.00% | 40.00% | 30,220 | 30,220 |
| 51,975 | 52,311 | |||||
| Total investments in subsidiaries and associates | 96,352 | 133,464 |
In the accompanying consolidated financial statements all these associates are calculated using the equity method.
Set out below is a summary of financial information about the subsidiaries:
| AD PLASTIK d.o.o., Novo Mesto, Slovenia | 31.12.2014 | 31.12.2013 |
|---|---|---|
| Total assets | 19,510 | 48,323 |
| Total liabilities | 15,386 | 44,901 |
| Net assets | 4,124 ____ |
3,422 ____ |
| Share in the net assets of the associate | 100.00% ____ |
100.00% ____ |
| ZAO PHR, Samara, Russian Federation | 31.12.2014 | 31.12.2013 |
|---|---|---|
| Total assets | 193,918 | 240,991 |
| Total liabilities | 214,422 | 218,628 |
| Net assets | (20,504) ____ |
22,363 ____ |
| Share in the net assets of the associate | 99.95% ____ |
99.95% ____ |
| ZAO AD Plastik Kaluga, Kaluga, Russian Federation | 31.12.2014 | 31.12.2013 |
| Total assets | 177,839 | 173,655 |
| Total liabilities | 159,239 | 151,147 |
| Net assets | 18,600 ____ |
22,508 ____ |
| Share in the net assets of the associate | 100.00% ____ |
100.00% ____ |
| ADP d.o.o, Mladenovac, Serbia | 31.12.2014 | 31.12.2013 |
| Total assets | 90,260 | 78,444 |
| Total liabilities | 84,457 | 64,849 |
| Net assets | 5,803 ____ |
13,595 ____ |
| Share in the net assets of the associate | 100.00% ____ |
100.00% ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Long-term loans to subsidiaries | 83,204 | 78,039 |
| Long-term loans to associates | 44,156 | 50,103 |
| Long-term loans to unrelated companies | 11,543 | 14,508 |
| Other financial assets | 64 | 64 |
| Current portion of long-term loan receivables | (3,137) ____ |
(44,820) ____ |
| 135,830 ____ |
97,894 ____ |
Long-term loans to subsidiaries and associates comprise long-term investment loans which bear interest at a rate of 7.0 % - 12.43% on loans, repayable over five years.
During the year, the Company turned short-term receivables in long-term receivables total value of 193,060 thousand kuna (December 31st, 2013 kuna 0) relating to companies within ADP Group (ZAO PHR 118,141 thousand kuna, ADP Kaluga 66,460 thousand kuna , Faurecia ADP Holding 8,459 thousand kuna ), and maturity is in 2016.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Raw material and supplies on stock | 34,101 | 19,254 |
| Finished products | 11,473 | 11,064 |
| Spare parts | 5,861 | 4,603 |
| Work in progress | 5,012 | 1,854 |
| Merchandise | 431 | 575 |
| Small items and packaging | 4 ____ |
1 ____ |
| 56,882 ____ |
37,351 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Foreign trade receivables | 173,828 | 209,511 |
| Domestic trade receivables | 9,835 | 12,635 |
| Impairment allowance on receivables | (8,569) ____ |
(10,364) ____ |
| 175,094 ____ |
211,782 ____ |
The average credit period on sales is 85 days (2013: 77 days). The Company has provided for all for all sued debtors, regardless of the past due period, as well as for all receivables that are past due and assessed as doubtful of collection.
The Company seeks and obtains from its domestic customers debentures as collaterals in the amount of the receivables.
Set out below is an analysis of major trade receivables:
| 31.12.2014. | 31.12.2013. | |
|---|---|---|
| Revoz, Slovenia | 57,883 | 5,371 |
| Visteon Deutschland, Germany | 36,586 | 21,670 |
| Grupo Antolin, Germany | 21,487 | - |
| Hella Saturnus, Slovenia | 6,779 | 4,945 |
| Peugeot Citroen SA, France | 5,524 | 5,695 |
| Ford Espana, Spain | 4,490 | - |
| EURO APS, Romania | 3,961 | 153 |
| Reydel Automotive France, France | 3,594 | - |
| Ford Werke, Germany | 3,544 | 1,955 |
| Renault, France | 2,130 | 2,594 |
| Peugeot Citroen ES, Spain | 1,788 | - |
| Toyota Peugeot, | 1,300 | - |
| Other debtors | 34,598 | 179,763 |
| _ 183,664 _ |
_ 222,146 _ |
Other debtors in the amount HRK 34,598 thousand (31 December 2013: HRK 179,763 thousand) relates to receivables from subsidiaries in the amount HRK 16,158 thousand which relates to delivered tools, equipment, material and services.
Movements in the impairment allowance on domestic trade receivables were as follows:
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Balance at beginning of the year | 8,890 | 10,241 |
| Amounts collected or eliminated during the year | (1,463) ____ |
(1,351) ____ |
| Total impairment allowance on domestic trade receivables | 7,427 ____ |
8,890 ____ |
| Balance at beginning of the year | 1,474 | 1,781 |
| Amounts collected or eliminated during the year | (332) ____ |
(307) ____ |
| Total impairment allowance on foreign trade receivables | 1,142 ____ |
1,474 ____ |
| Total impairment allowance | 8,569 ____ |
10,364 ____ |
All receivables provided against are under litigation or included in bankruptcy estate. Ageing analysis of impaired receivables:
| 31.12.2014 | 31.12.2013 |
|---|---|
| - | - |
| 8,569 | 10,364 ____ |
| 8,569 ____ |
10,364 ____ |
| ____ |
Ageing analysis of receivables past due but not impaired:
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| 1 - 365 days | 102,636 | 102,174 |
| Over 365 days | 106,907 ____ |
41,482 ____ |
| 209,543 ____ |
143,656 ____ |
In aging structure of due receivables above 365 days in the amount HRK 106,907 thousand (31.12.2013: HRK 41,482 thousand) majority relates to receivables from companies in which AD Plastik d.d. has majority share and control over collection of receivables, in the amount of HRK 105,175 thousand (31.12.2013: HRK 30,128 thousand) and control over collection of receivables.
Receivables from related companies
| 31.12.2014 | 31.12.2013 |
|---|---|
| 14,362 | 142,701 |
| 1,828 | 1,204 ____ |
| 16,190 | 143,905 ____ |
| _ _ |
In 2014 the Company turned part of the receivables from subsidiaries into long-term receivables with maturity in 2016.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Foreign prepayments made | 20,404 | 32,181 |
| Due from the state | 9,297 | 7,362 |
| Domestic prepayments made | 3,883 | 7,437 |
| Amounts due from employees | 414 | 537 |
| Other receivables | - ____ |
562 ____ |
| 33,978 ____ |
48,079 __ |
Amounts due from the State and state institutions comprise receivables from the State Budged in respect of VAT refund, refunds from the Croatian Health Insurance Fund and similar. Domestic and foreign prepayments comprise prepayments made for purchases of production equipment and tools.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Short-term loans to subsidiaries | 13,415 | 26,285 |
| Other short-term loan | 2,291 | - |
| Other deposits | 13 | 9 |
| Short-term loans to associates | - | 16,794 |
| Current portion of long-term loan receivables | 3,137 ____ |
44,820 ____ |
| 18,856 ____ |
87,908 __ |
Short-term loans to subsidiaries refer to loans with an average interest rate of 7%.
Other short-term loans to third parties are related to the loan granted to the company Autocentar-Merkur d.d., Zagreb with 7.2% interest rate, with a maturity in the first quarter of 2015.
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Foreign account balance | 1,256 | 14,346 |
| Current account balance | 527 | 164 |
| Cash in hand | 18 ____ |
21 ____ |
| 1,801 ____ |
14,531 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Other accrued income on tools | 44,183 | 108,296 |
| Prepaid operating expenses | 12,561 | 7,804 |
| Other accrued income | 5,763 ____ |
3,003 ____ |
| 62,507 ____ |
119,103 ____ |
Accrued income in the amount of HRK 44,183 thousand (31 December 2013: HRK 108,296 thousand) relates to the manufacture of tools for a known customer. Income from the manufacture of tools is recognized using the stage-of-completion method to determine the amount of income and costs attributable to a certain period.
Subscribed capital amounts to HRK 419,958 thousand and consists of 4,199,580 shares, with a nominal value of HRK 100.00 per share (31 December 2013: HRK 419,958 thousand, 4,199,580 shares, with a nominal value of HRK 100 each).
The shareholders with over 2 percent of the shares at 31 December 2014 were as follows:
| Number of | Ownership in | Type of | ||
|---|---|---|---|---|
| Shareholder | Headquarters | shares | % | account |
| OAO HOLDING AUTOKOMPONENTI | Saint Petersburg, Russia |
1,259,875 | 30.00% | Primary account |
| HYPO ALPE-ADRIA-BANK D.D./ RAIFFEISEN MANDATORY PENSION FUND |
Zagreb, Croatia | 269,462 | 6.42% | Pension fund |
| ADP-ESOP D.O.O. | Zagreb, Croatia | 212,776 | 5.07% | Primary account |
| PBZ D.D. / STATE STREET CLIENT | Zagreb, Croatia | 120.892 | 2.88% | Custody account |
| HYPO ALPE-ADRIA-BANK D.D./PBZ | ||||
| CROATIA OSIGURANJE | Zagreb, Croatia | 119,640 | 2.85% | Pension fund |
| MANDATORY PENSION FUND | ||||
| SOCIETE GENERALE-SPLITSKA | Split, Croatia / | 115.353 | 2.75% | Pension fund |
| BANKA D.D. / ERSTE PLAVI OMF | Zagreb, Croatia | |||
| HRVATSKA POŠTANSKA BANKA D.D./ KAPITALNI FOND D.D. |
Zagreb, Croatia | 111.541 | 2.66% | Pension fund |
| ERSTE & STEIERMARKISCHE BANK | Custody | |||
| D.D./ JOINT CUSTODY ACCOUNT | Zagreb, Croatia | 110,349 | 2.63% | account |
| FOR A FOREIGN LEGAL PERSON | ||||
| SOCIETE GENERALE-SPLITSKA | Split, Croatia / | |||
| BANKA D.D. / AZ OMF KATEGORIJE | Zagreb, Croatia | 93.900 | 2.24% | Pension fund |
| B | ||||
| Total: | 2,413,788 | 57.50% |
| Short-term: | Long-term: | |||
|---|---|---|---|---|
| 31 December 2014 |
31 December 2013 |
31 December 2014 |
31 December 2013 |
|
| Jubilee awards | - | - | 1,302 | 1,568 |
| Termination benefits | - | - | 688 | 1,084 |
| Legal actions | 3,720 | 3,351 | - | - |
| Vacation accrual | 3,197 ____ |
2,158 ____ |
- ____ |
- ____ |
| 6,917 ____ |
5,509 ____ |
1,990 ____ |
2,652 ____ |
| Jubilee awards | Termination benefits |
Legal actions |
Vacation accrual |
Total | |
|---|---|---|---|---|---|
| Balance at 1 January 2014 |
1,568 | 1,084 | 3,351 | 2,158 | 8,161 |
| Increase/(decrease) in | (266) | (396) | 369 | 1,039 | 746 |
| provisions | ____ | ____ | ____ | _ _ | |
| Balance at 31 | 1,302 | 688 | 3,720 | 3,197 | 8,907 |
| December 2014 | ____ | ____ | ____ | _ _ |
According to the Union Agreement, the Company has the obligation to pay long-service (jubilee awards), retirement and other benefits to employees. The Company operates a defined benefit plan for qualifying employees. Retirement and long-service benefits are defined in the Union Agreement. No other post-retirement benefits are provided.
Long-service benefits are paid for full years of service in the month of the current year in which the service is determined as completed.
The present value of defined benefit obligations and the related current and past service cost have been determined using the projected credit unit method.
Key assumptions used in calculating the required provisions are the discount rate of 4.18% and the rate of fluctuation of 5.90%
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Long-term borrowings | 259,451 | 279,099 |
| Trade payables | 15,870 ____ |
- ____ |
| 275,322 | 279,099 | |
| Current portion of long-term borrowings | (74,114) ____ |
(74,383) ____ |
| Total long-term borrowings | 201,208 ____ |
204,716 ____ |
Long-term loans are mainly realized through programs of HBOR and are used to finance capital investments and development projects. Provided collaterals for long-term loans are mortgages on real estates and/or equipment and instruments of payment. All long-term loans are repayable on a quarterly basis, repayment of existing long-term loans is in the period March 31st, 2015 – December 31st, 2021.
The average interest rate on long-term loans in 2014 amounted to 3.66%.
The Company regularly performs all obligations from these loans, respecting all the conditions of the contract.
Movements in long-term borrowings during the year:
| 2014 | 2013 | |
|---|---|---|
| Balance at 1 January | 204,716 | 110,180 |
| New loans raised | 75,941 | 179,677 |
| Amounts repaid | (79,449) ____ |
(85,141) ____ |
| Total long-term borrowings | 201,208 ____ |
204,716 ____ |
| 31.12.2014 | 31.12.2013 |
|---|---|
| Foreign customers 55,988 |
77,433 |
| Domestic customers - ____ |
85 ____ |
| 55,988 ____ |
77,518 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Foreign trade payables | 172,698 | 81,052 |
| Domestic trade payables | 51,130 ____ |
26,643 ____ |
| 223,828 ____ |
107,695 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Short-term borrowings - principal payable | 181,074 | 130,208 |
| Current portion of long-term borrowings | 74,114 | 74,383 |
| Short-term borrowings - interest payable | 1,668 | 1,664 |
| Other short-term financial liabilities | 1,144 ____ |
1,070 ____ |
| 258,000 ____ |
207,325 ____ |
Short-term loans were used to finance development projects and for working capital. Provided collaterals for shortterm loans are instruments of payment. Of the total amount of short-term loans 40% of short-term loans is related to the revolving frames and approved overdrafts on accounts with the annual renewal of limits.
The average interest rate on short-term loans in 2014 amounted to 5,66%.
The Company regularly performs all obligations from these loans.
| 2014 | 2013 | |
|---|---|---|
| Balance at 1 January | 207,325 | 124,975 |
| New loans raised | 136,656 | 108,167 |
| Amounts repaid | (85,981) ____ |
(25,817) ____ |
| Total short term loans | 258,000 ____ |
207,325 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Amounts due to employees | 7,971 | 5,630 |
| Due to the State and State institutions | 4,516 | 3,286 |
| Other current liabilities | 38 ____ |
40 ____ |
| 12,525 ____ |
8,956 ____ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Accrued tool expenses | 6,511 | 16,909 |
| Due to the State and State institutions | 256 | 372 |
| Other current liabilities | 3,510 ____ |
1,052 ____ |
| 10,277 ____ |
18,333 ____ |
The transactions carried out with related companies are summarized below:
| Trade receivables and payables | Receivables | Liabilities | ||
|---|---|---|---|---|
| 31.12.2014 | 31.12.2013 | 31.12.2014 | 31.12.2013 | |
| AD PLASTIK d.o.o. , Slovenia | 32 | 13,444 | 2,538 | 41 |
| ZAO PHR, Russia | 126,516 | 91,380 | 9,206 | 4,933 |
| ZAO ADP KALUGA , Russia | 66,460 | 37,870 | 1,774 | 1,440 |
| ADP d.o.o. Mladenovac, Serbia | 7,783 | 1,211 | 5,028 | 799 |
| EURO APS, Romania | 3,961 | 4,072 | - | 32 |
| FADP Holding, France | 8,459 ____ |
17,648 _ _ |
- | - ____ |
| 213,211 ____ |
165,625 _ _ |
18,546 | 7,245 ____ |
| Income | Expenses | |||
|---|---|---|---|---|
| Operating income and expenses | 2014 | 2013 | 2014 | 2013 |
| AD PLASTIK d.o.o. , Slovenia | 49,587 | 103,750 | 108 | 799 |
| ZAO PHR, Russia | 48,362 | 63,395 | 16,421 | 11,843 |
| ZAO ADP KALUGA , Russia | 34,599 | 32,935 | 7,783 | 2,317 |
| ADP d.o.o. Mladenovac, Serbia | 6,684 | 6,478 | 1,438 | 985 |
| EURO APS, Romania | 8,372 | 8,173 | - | 68 |
| FADP Holding, France | - ____ |
- _ _ |
- | - ____ |
| 147,604 ____ |
214,731 _ _ |
25,750 | 16,012 ____ |
Trading transactions
| Income | Expenses | |||
|---|---|---|---|---|
| Financial income and expenses | 2014 | 2013 | 2014 | 2013 |
| ZAO PHR, Russia | 1,636 | 2,743 | - | 96 |
| ZAO ADP KALUGA , Russia | 2,393 | 2,732 | - | 3,984 |
| AD PLASTIK d.o.o. , Slovenia | - | 441 | 335 | 940 |
| ADP d.o.o. Mladenovac, Serbia | 1,469 | 698 | - | 55 |
| EURO APS, Romania | 40,987 | 26,931 | - | - |
| FADP Holding, France | 7,912 ____ |
8,300 ____ |
- ____ |
- ____ |
| 54,397 ____ |
41,845 ____ |
335 ____ |
5,075 ____ |
| Directors' and executives' remuneration: | |||
|---|---|---|---|
| -- | -- | -- | ------------------------------------------ |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Salaries | 10,948 ____ |
10,457 ____ |
| 10,948 ____ |
10,457 ____ |
|
The Company's gearing ratio, expressed as the ratio of net debt to equity, can be expressed as follows:
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Short-term borrowings | 258,000 | 207,325 |
| Long-term borrowings | 201,208 | 204,716 |
| Cash and cash equivalents | (1,801) | (14,531) |
| Net debt | _ 457,407 _ |
_ 397,510 _ |
| Equity Net debt-to-equity ratio |
625,309 73.15% |
677,341 57.96% |
| 31.12.2014 | 31.12.2013 | |
|---|---|---|
| Financial assets | 452,632 | 586,296 |
| Investments in subsidiaries and associates | 96,352 | 133,464 |
| Loans | 138,967 | 97,893 |
| Trade receivables | 175,094 | 211,782 |
| Other receivables | 40,418 | 128,626 |
| Cash | 1,801 | 14,531 |
| Financial liabilities | 747,033 | 602,923 |
| Loans | 459,208 | 412,041 |
| Trade payables | 287,825 | 190,882 |
At the reporting date there are no significant concentrations of credit risk for loans and receivables designated at fair value through the statement of comprehensive income. Receivables and liabilities toward Government are not included in stated amounts.
Company's Treasury function provides services to the business, co-ordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of the Company through internal risk reports which analyze exposures by degree and magnitude of risks. These risks include market risk (including currency risk, fair value interest rate risk and price risk), credit risk, liquidity risk and cash flow interest rate risk. The Company seeks to minimize the effects of these risks. The Company does not enter into, or trade in financial instruments, including derivative financial instruments, for speculative purposes.
The largest markets on which the Company provides its services and sells its products comprise the EU market and the market of the Russian Federation. The management determines the prices of its products separately for domestic and foreign markets by reference to the market prices.
Interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates relative to the interest rate, which applies to the financial instrument. Interest rate cash flow risk is the risk that the interest cost of an instrument will fluctuate over time. The interest rate risk exposure is low, as there are no financial instruments at variable rates.
The Company is exposed to credit risk through loans and trade receivables. Loans are granted to its subsidiaries and as such credit risk is under the control of the Company. Trade receivables are presented net of allowance for bad and doubtful accounts.
The eight largest customers of the Company are AD Plastik d.o.o. Slovenia, Hella Saturnus Slovenia, Visteon Germany, ZAO PHR Russia, Peugeot France, ZAO AD Plastik Kaluga Russia, Ford Motor Germany i Revoz Slovenia. Revenues generated by the sales to these business partners represent 91.90 percent of the total sales.
It is the policy of the Company to transact with financially sound companies where there is minimized risk of collection.
The Company undertakes certain transactions denominated in foreign currencies. Hence, exposures to exchange rate fluctuations arise. The carrying amounts of the Company's foreign-currency denominated monetary assets and monetary liabilities at the reporting date are provided in the table below using exchange rates of the Croatian National Bank:
| At 31 December | Assets | Liabilities | Net position | ||||
|---|---|---|---|---|---|---|---|
| 2014 | 2013 | 2014 | 2013 | 2014 | 2013 | ||
| EUR | 433,926 | 307,319 | 449,900 | 337,426 | (15,974) | (30,107) | |
| RUR | 91,319 | 117,304 | 1 | 1 | 91,318 | 117,303 | |
| USD | 649 | 395 | 792 | 410 | (143) | (15) | |
| GBP | 1 | 47 | 157 | 62 | (156) | (15) | |
| RON | - | 2,555 | - | - | - | 2,555 | |
| JPY | - | - | - | 4 | - | (4) | |
| RSD | 3,744 | - | - | - | 3,744 | - | |
| ___ 529,639 _ |
___ 427,620 _ |
___ 450,850 __ |
___ 337,903 __ |
___ 78,789 _ |
___ 89,717 __ |
||
The Company is mainly exposed to the countries using EUR and RUR as their currency. The following table details the Company to change the exchange rate of 2% compared to the rate of the euro and 10% compared to the rate of the ruble in 2014 and 2013. The sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts their translation at the year-end. A negative number below indicates a decrease in profit and a positive number below indicates an increase in profit where the Croatian kuna changes against the relevant currency for the percentage specified above.
| EUR impact | |||
|---|---|---|---|
| 2014 | 2013 | ||
| Change in exchange differences (2%) | +/- 354 | +/- 660 | |
| RUR impact 2014 |
2013 | ||
| Change in exchange differences (10%) | +/- 9,143 | +/- 11,730 |
Ultimate responsibility for liquidity risk management rests with the Management Board. The Company manages its liquidity using banking facilities (overdrafts) and by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.
The following tables detail the Company's remaining contractual maturity for its non-derivative financial assets and liabilities. The tables have been drawn up based on the undiscounted cash flows of financial assets and liabilities based on the earliest date on which the Company can require payment i.e. can be required to pay.
| Up to 1 month |
1 to 3 months |
3 months to 1 year |
1 to 5 years |
Over 5 years |
Total | ||
|---|---|---|---|---|---|---|---|
| 2014 | Average interest rate |
||||||
| Assets | |||||||
| Non-interest | |||||||
| bearing | 12,070 | 17,848 | 169,898 | - | 96,352 | 296,168 | |
| Interest bearing | 8.82% | 370 | 2,587 | 17,677 | 129,215 | 6,615 | 156,464 |
| 12,440 ___ |
20,435 ___ |
187,575 ___ |
129,215 __ |
102,967 __ |
452,632 ___ |
||
| Liabilities | _ | _ | |||||
| Non-interest | |||||||
| bearing | 24,840 | 15,184 | 199,548 | 48.253 | - | 287,825 | |
| Interest bearing | 4.52% | 4,484 ___ |
48,162 ___ |
224,676 ___ |
139.029 __ |
42,857 __ |
459,208 ___ |
| 29,324 ___ |
63,346 ___ |
424,224 ___ |
187.282 ________ |
42,857 ________ |
747,033 ___ |
||
| 2013 | Average interest rate |
||||||
| Assets | |||||||
| Non-interest | |||||||
| bearing | 24,830 | 34,409 | 198,783 | - | 133,464 | 391,486 | |
| Interest bearing | 9.95% | 751 | 6,671 | 89,494 | 79,865 | 18,029 | 194,810 |
| 25,581 ___ |
41,080 ___ |
288,277 ___ |
79,865 __ |
151,493 __ |
586,296 ___ |
||
| Liabilities | _ | _ | |||||
| Non-interest | |||||||
| bearing | 23,655 | 15,965 | 79,994 | 71,268 | - | 190,882 | |
| Interest bearing | 4.53% | 3,602 ___ |
46,219 ___ |
155,959 ___ |
168,208 __ |
38,053 __ |
412,041 ___ |
| 27,257 ___ |
62,184 ___ |
235,953 ___ |
239,476 ________ |
38,053 ________ |
602,923 ___ |
Financial instruments held to maturity in the ordinary course of business are carried at the lower of cost and net amount less repaid portion.
The fair value represents the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm's length transaction, except in the event of a forced sale or liquidation. The fair value of a financial instrument is its quoted market price, or the amount obtained using the discounted cash flow method.
At 31 December 2014, the carrying amounts of cash, receivables, short-term liabilities, accrued expenses, shortterm borrowings and other financial instruments approximate their fair values due to the short-term maturity of these financial instruments.
From December 31st, 2014 no business events or transactions have incurred that could have a significant impact on the financial statements as at and for the period then ended, or that are of such importance to the Company that would require disclosure in the notes to the financial statements.
According to estimates made by Company's Management Board, as at December 31st, 2014 the Company has no significant contingent liabilities that would require disclosure in the notes to the financial statements.
As at December 31st, 2014 no significant litigation has been conducted against the Company in which the failure is expected and which has not been presented in the financial statements.
These financial statements were approved by the Management Board of AD Plastik d.d. and authorized for issue on 23 April 2015.
For AD Plastik d.d. Solin:
Marinko Došen President of the Management Board
Pursuant to clause 300 d. Companies Act and clause 29 of AD PLASTIK`s Inc., Solin, Statue, the Supervisory Board of AD PLASTIK dd Solin, OIB: 48351740621, on 28/05/2014. year brings
About acceptance of the Annual financial statements of AD PLASTIK Inc. and consolidated annual financial statements of the Group AD PLASTIK for 2013. Year
| I. Acceptance of the Annual Financial Statements of AD PLASTIK Inc. for 2014 year |
|
|---|---|
| as follows: | |
| 1. Balance with the sum of assets and liabilities | 1.396.210.674 HRK |
| 2. Profit and loss account with the data: | |
| - total revenues | 681.090.687 HRK |
| - total expenditures | 668.222.717 HRK |
| - profit before tax | 12.867.970 HRK |
| - income tax | 143.599 HRK |
| - profit for the year | 12.724.371 HRK |
| 3. Cash Flow Statement for the year 2014 | |
| with data on the Net decrease in cash and | |
| cash equivalents | 12.730.527 HRK |
II. Acceptance of the Consolidated Financial Statements of AD Plastik Group for 2014 year as follows:
| 1. Balance with the sum of assets and liabilities | 1.546.772.703 HRK |
|---|---|
| 2. Profit and loss account with the data: | |
| - total revenues | 981.495.131 HRK |
| - total expenditures | 976.434.578 HRK |
| - profit before tax | 5.060.553 HRK |
| - income tax | 143.599 HRK |
| - profit for the year | 4.916.954 HRK |
| - loss minority interest | - 12.960 HRK |
| - net profit of the Group | 4.929.914 HRK |
| 3. Cash Flow Statement for the year 2014 | |
| with data on the Net decrease in cash and | |
| cash equivalents | 21.137.477 HRK |
President of the Supervisory Board
Josip Boban
Pursuant to clause 275. Part 1, point 2 Companies Act and clause 33 of AD Plastik Inc, Solin, Statute, Supervisory Board of AD Plastik Solin on day 24.07.2014. brings:
Net income of AD Plastik, Solin from year 2014., after tax, is 12.724.371,00 kuna and is being used for other reserves.
General assembly President
Management Board Parent Company
MARINKO DOŠEN, President of the Management Board Matoševa 8, 21210 Solin, Croatia Phone +385 21 20 65 00, Fax. + 385 21 20 64 95 e-mail: [email protected]
MLADEN PEROŠ, Board Member responsible for development and commercial affairs Matoševa 8, 21210 Solin, Croatia Phone +385 21 20 64 88, Fax. + 385 21 20 64 95 e-mail: [email protected]
KATIJA KLEPO Board Member responisble for finance and accounting Matoševa 8, 21210 Solin, Croatia Phone +385 21 20 64 88, Fax. + 385 21 20 64 89 e-mail: [email protected]
IVICA TOLIĆ, Board Member responisble for legal affairs and corporate communications Matoševa 8, 21210 Solin, Croatia Phone +385 21 20 64 88, Fax. + 385 21 20 64 89 e-mail: [email protected]
DENIS FUSEK, Board Member responisble for business organization, informatics and controlling Matoševa 8, 21210 Solin, Croatia Phone +385 21 20 64 88, Fax. + 385 21 20 64 89 e-mail: [email protected]
HRVOJE JURIŠIĆ, Board Member responisble for development Matoševa 8, 21210 Solin, Croatia Phone +385 21 20 64 88, Fax. + 385 21 20 64 89 e-mail: [email protected]
ZAO PHR 443057 SAMARA Krasnoglinski rajon Zas. Vintai RUSSIAN FEDERATION Phone +7 846 978 1234, Fax. + 7 846 978 1231 e-mail: [email protected]
AD PLASTIK Ltd. Belokranjska 4, 8000 Novo Mesto, REPUBLIC OF SLOVENIA Phone +386 7 337 9820, Fax. + 386 7 337 9821 e-mail: [email protected]
EURO APS s.r.l. 115400 Mioveni, Judetul Arges, Strada Uzinei 2A, ROMANIA Phone +40 755 016 858 e-mail: [email protected]
ZAO ADP Kaluga, Skladskaya 6, Kaluzhskaya oblast Kaluga RUSSIAN FEDERATION Phone + 7 1372 218 10 Mob. +385 91 200 99 17 e-mail: [email protected]
Rue Heinnape 2 Nanterre FRANCE Phone +33 1 72 36 73 07 e-mail: [email protected]
Ulica Kralja Petra I 334, SERBIA Phone +381 11 8230 969 e-mail: [email protected]
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