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Altri SGPS — Interim / Quarterly Report 2014
Aug 1, 2014
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Interim / Quarterly Report
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DIRECTORS' REPORT
30 June 2014
| INTRODUCTION 3 |
|
|---|---|
| STOCK EXCHANGE EVOLUTION5 | |
| GROUP'S ACTIVITY7 | |
| FINANCIAL ANALYSIS 11 |
|
| OUTLOOK FOR THE SECOND HALF OF 2014 14 |
|
| CORPORATE GOVERNANCE 15 |
|
| LEGAL MATTERS 16 |
|
| STATEMENT UNDER ARTICLE 246, PARAGRAPH 1, C) OF THE SECURITIES CODE18 | |
| DECLARATION OF RESPONSIBILITY18 | |
| CLOSING REMARKS 19 |
(This is a translation of a document originally issued in Portuguese. In the event of discrepancies, the Portuguese language version prevails – Note 20)
To the Shareholders
Pursuant to the legal requirements, the Board of Directors of Altri, S.G.P.S., S.A. ('Altri') hereby presents its Directors' Report for the first semester of 2014.
INTRODUCTION
Altri was incorporated as of March 2005, as a result of Cofina's demerger. Altri is a reference European producer of bleached eucalyptus pulp and is a listed company included in NYSE Euronext Lisbon, integrating the PSI 20 (Portuguese Stock Index), the benchmark stock market index. In addition to pulp production, the company is also present in electric energy from forest renewable sources, namely industrial cogeneration, black liquor and biomass. The forestry strategy is based on full use of all the components provided by the forest: pulp, black liquor and forest wastes.
Over the past years, Altri invested in Portugal about 470 million Euro, mainly on Celbi and Celtejo unities. Currently, Altri owns three pulp mills in Portugal with a total capacity of 970,000 tons/year of bleached eucalyptus pulp in 2013. The company has an ongoing series of small projects to increase production capacity of Celbi and Caima, which is expected to be concluded between the end of this year and the beginning of the next. Thus, Caima, at the end of the project of conversion to pulp specialties sector, will produce around 105,000 tons/year. On the other hand, Celbi will hold an installed capacity exceeding 700,000 tons/year of bleached pulp type BEKP.
Currently, Altri manages over 84,000 hectares of forest in Portugal. The company obtained certification from the Forest Stewardship Council® (FSC®) 1 and Programme for the Endorsement of Forest Certification (PEFC two of the most worldwide acknowledged certification entities.
Altri's industrial strategy implementation is based on integrated forest management in Portugal. This model is based on forest optimization, ensuring a full recovery of all its components. Thus, the eucalyptus is processed in Altri mills, producing pulp and power (cogeneration). The bark, the branches and forest waste are used to produce electric energy from biomass.
Until June 2008, Altri had another industrial activity through the F. Ramada, which was devoted to retail steel and development of industrial solutions for storage systems. In June 2008 took place the split of the F. Ramada. The strategic rationale of this operation lies in focusing exclusively Altri on their core business, forest management and production of pulp.
Since the beginning of its activity Altri carried out various acquisitions (Celtejo in 2005 and in 2006 Celbi) that allowed Altri to reinforce its position in its operating markets and by the development of a set of expansion activity projects.
For a better valuation of forest resources, Altri acquired in 2005, 50% of EDP Produção - Bioeléctrica, S.A., for, in partnership with EDP, producing electricity from forest biomass. This company is leader in its market segment with a share licenses to the production of electricity by forest biomass of 50%.
1 FSC-C004615
Altri's structure as of 30 June 2014 is as follows:
STOCK EXCHANGE EVOLUTION
Altri's share price closed the first six months of 2014 at 2.092 Euro per share. The market capitalization at the end of that period was 429 million Euro.
During the first semester of 2014 Altri's share price reached the maximum of 2.941 Euro per share and the minimum of 2,092 Euro per share. In total, 43.5 million shares were traded in that period, which corresponds to 21% of the issued capital.
The main events that marked the evolution of the shares of the Company during the first semester of 2014 can be described chronologically as follows:
On March 6, the Group announced the financial performance of the year 2013 with a consolidated net profit around 55 million Euro. The consolidated revenues reached 573 million Euro, representing an increase of 6% comparing to 2012. Consolidated EBITDA amounted to 141 million Euro, recording a slight decrease of 1% comparing to 2012. On that date, shares' closing price reached 2.941 Euro per share;
- In a statement made on April 24, Altri informed the market about the deliberations of the General Meeting held on that date which approved, among others, the proposal for distribution of dividends corresponding to 0.042 Euro per share;
- On May 6, Altri informed the market it had issued a bond loan, by private subscription, amounting to 70,000,000 Euro (seventy million euro), with a duration of four and a half years, named "ALTRI / NOVEMBRO 2018";
- On May 7, 2014, Altri informed the market that the dividend of 2013 would be paid from 22 May onwards;
- In a statement made on May 7, the Group announced the results of the first quarter of 2014. During this period, the consolidated total revenues reached 129 million Euro. EBITDA reached about 26 million Euro while the consolidated net profit reached 7.7 million Euro.
GROUP'S ACTIVITY
With its genesis in the reorganization process of Cofina with the purpose of setting into a separate holding the industrial operations, Altri held until 1 June 2008 the investments in the paper, pulp, steel and storage systems, date considered for the demerger process the business of steel and storage systems. This reorganization is part of a focusing and business transparency strategy, aiming at giving greater visibility to each area and increasing market perception of value.
The main participations where Altri holds the majority of capital are as follows:
- Caima Indústria de Celulose (Constância), producer and distributor of paper pulp;
- Celbi Celulose da Beira Industrial (Figueira da Foz), producer and distributor of paper pulp;
- Celtejo Empresa de Celulose do Tejo (Vila Velha de Ródão), producer and distributor of paper pulp;
- Altri Florestal (Constância), manager of the Group's forestry resources.
Moreover, in order to fulfil its energetic needs and expand its activity in a strategic sector, the Group holds a participation of 50% of the share-capital of EDP Bioeléctrica.
Location of the industrial units of the Group Location of the centrals of energy production
Altri's complete structure of participation as of 30 June 2014 is as follows:
Pulp Market
According to data from Pulp and Paper Products Council (PPPC), in the first six months of 2014, the total demand for hardwood pulp increases 1.1% compared to same period of 2013, reaching 14.2 million tons. The total demand for eucalyptus pulp recorded an increase in demand of 4.8% compared to the first half of 2013. Geographically it is observed that the consumption of hardwood pulp in Western Europe recorded a negative evolution of about 2.1%, whilst China recorded a growth of 5.1%. Detailing for pulp types, and according to PPPC, during the first six months of the year, the global demand for printing and writing papers decreased about 0.6%. The demand for tissue paper grew globally by 0.5%.
In terms of supply, during the first quarter of 2014 a new industrial unit for production of eucalyptus pulp, with projected annual production capacity of 1.5 million tons started operating, for which it is estimated that 1 million tons will be produced this year.
In terms of evolution of the BEKP pulp price, according to the PIX, the second quarter of 2014 was characterized by a decline of 2.3% of the price in EUR comparing to the previous quarter. The average price of the first half of 2014 was 554 Euro (759 USD), which represents a decrease of 9.2% (or 5.2% in USD).
Evolution of BEKP pulp price in Europe since 2003 until June 2014
Sales and production showed different behavior in the first 2 quarters of 2014.The first quarter was characterized, by an adverse environment in terms of price, which was exacerbated by the appreciation of the Euro against the dollar and, on the other hand, by the maintenance stoppage of Celbi that was not performed in 2013.
The second quarter of 2014 recorded an increase of production and sales of pulp in a context of market price reduction. Thus, although the production and sales recorded an increase of 17% and 7% respectively, compared to the first quarter of 2014, the sales price of pulp, in Euro, recorded a decrease of 4.7%.
Evolution of pulp production between 1st H2013 and 1st H2014 by mill
(Thousand tons)
(Thousand tons)
During the first half of 2014, the three industrial units of Altri produced around 474.6 thousand tons of pulp, slight decreasing the production around 1.6% comparing to the same period of 2013.
In detail, the main Altri industrial unit, Celbi, produced around 320.4 thousand tons of pulp (-3%); Celtejo produced around 111.3 thousand tons (+3%) and Caima produced around 42.8 thousand tons (-2%) – it is important to mention that Caima, is going through an investment project that aims the production of specialties pulp and which is predicted to end in 2015.
In terms of sales, during the first quarter, the Group sold around 233.4 thousand tons, which correspond to a decrease of 5% compared to 245.9 thousand tons of pulp sold during the first quarter of 2013. Moreover, during the second quarter of 2014, the Group sold around 250.2 thousand tons, which correspond to an increase about 2% compared to 245.0 thousand tons of pulp sold during the second quarter of 2013. Globally, in first half of 2014 the Group sold 483.6 thousand tons, which correspond to a slight decrease of 1% compared to the same period of 2013, and is justified, essentially, due to the maintenance stoppage of Celbi in the first quarter of 2014 and by the ongoing investment in Caima.
The pulp sales amounted to about 216 million Euro, representing 82% of Altri's total revenue, recording a decrease of 12% compared to the sales of the same period of 2013.
In the first half of 2014, Altri exported 455 thousand tons of pulp, which represents 94% of Altri's pulp sales. The amount of these exports reached 204.4 million Euro.
FINANCIAL ANALYSIS
The financial information was prepared in accordance with the International Financial Reporting Standards (IFRS), adopt by European Union. The main indicators and data of Altri Group are the following:
| 1H14/1H13 | |||
|---|---|---|---|
| thousand euros | 1H 2013 | 1H 2014 | Var% |
| Sales | 285,838 | 254,924 | -10.8% |
| Services rendered | 4,300 | 4,370 | 1.6% |
| Other Income | 5,351 | 4,407 | -17.6% |
| Total Revenues | 295,489 | 263,702 | -10.8% |
| Costs of sales | 123,832 | 124,445 | 0.5% |
| External supplies and services | 74,588 | 71,520 | -4.1% |
| Payroll expenses | 13,504 | 13,921 | 3.1% |
| Provisions and impairment losses | 7,609 | 1,555 | -79.6% |
| Other expenses | 628 | 53 | -91.6% |
| Total expenses (a) | 220,160 | 211,494 | -3.9% |
| EBITDA (b) | 75,328 | 52,208 | -30.7% |
| Margin | 25.5% | 19.8% | -5,7 pp |
| Amortisation and depreciation | 24,639 | 25,156 | 2.1% |
| Other indirect taxes | 2,723 | 0 | - |
| EBIT (c) | 47,967 | 27,052 | -43.6% |
| Margin | 16.2% | 10.3% | -6,0 pp |
| Gains and losses in associated companies | 1,109 | 1,253 | 13.0% |
| Financial expenses | -14,619 | -17,799 | 21.8% |
| Financial income | 1,973 | 3,196 | 62.0% |
| Financial profit | -11,537 | -13,351 | 15.7% |
| Profit before income tax | 36,431 | 13,701 | -62.4% |
| Income tax | -6,164 | -1,002 | ss |
| Minority interest | 10 | 0 | ss |
| Profit for the period attributable to parent company's shareholders | 30,256 | 12,699 | -58.0% |
(a) Operating costs excluding amortisation, financial expenses and income tax
(b) EBITDA = Earnings before interests, taxes, depreciation and amortisation
(c) EBIT = Earnings before interest and taxes
The first half of 2014 recorded sales of 264 million Euro (-11%), EBITDA of 27 million Euro (-31%) and a net profit around 13 million Euro (-57%).
Total revenues recorded in the first half of 2014 amounted to 263.7 million Euro, which represents a decrease of 11% compared to the same period of 2013.
Total costs, excluding depreciation, interest and tax, amounted to around 211.5 million Euro, an amount approximately 4% lower than in the first half of 2013.
EBITDA of the first half of 2014 reached about 52.2 million Euro, a decrease of around 31% compared to the same period of 2013. EBITDA margin reached 19.8%.
The operating result (EBIT) was about 27.1 million Euro, which represents a decrease of 44% compared to the EBIT for the first half of 2013.
Altri's net profit reached 12.7 million Euro.
Key balance sheet indicators
| thousand euros | 2013 | 1H 2014 | Var% |
|---|---|---|---|
| Biological assets | 107,123.0 | 107,383.1 | 0% |
| Tangible assets | 390,512.5 | 385,086.5 | -1% |
| Goodw ill |
265,531.4 | 265,531.4 | 0% |
| Investments available for sale | 14,656.9 | 12,116.9 | -17% |
| Others | 43,534.6 | 44,046.3 | 1% |
| Total non current assets | 821,358.4 | 814,164.2 | -1% |
| Inventories | 54,829.3 | 57,365.5 | 5% |
| Customers | 80,294.6 | 74,220.5 | -8% |
| Cash and cash equivalentes | 232,450.5 | 338,257.4 | 46% |
| Others | 32,445.0 | 37,144.9 | 14% |
| Total current assets | 400,019.4 | 506,988.3 | 27% |
| Total assets | 1,221,377.8 | 1,321,152.5 | 8% |
| Shareholder's equity and non controlling interests | 241,809.8 | 247,050.9 | 2% |
| Bank loans | 74,212.5 | 104,325.0 | 41% |
| Other loans | 439,370.3 | 336,458.0 | -23% |
| Reimbursable incentives | 11,228.4 | 15,744.4 | 40% |
| Others | 55,809.3 | 53,099.4 | -5% |
| Total non current liabilities | 580,620.5 | 509,626.7 | -12% |
| Bank loans | 78,693.4 | 1,328.2 | -98% |
| Other current loans | 213,719.6 | 451,912.7 | 111% |
| Reimbursable subsidies | 71.0 | 4,009.9 | 5547% |
| Suppliers | 60,034.6 | 57,231.4 | -5% |
| Others | 46,429.0 | 49,992.7 | 8% |
| Total current liabilities | 398,947.5 | 564,474.9 | 41% |
The net investment made by Altri's industrial units in the first half of 2014 amounts to 18.5 million Euro.
Altri's nominal remunerated debt net of cash and cash equivalents and investments available for sale on June 30, 2014 amounted to 550.0 million Euro, decreasing 8.1 million Euro comparing to net debt recorded in the end of March 2014 and decreasing 13.2 million Euro when comparing to the end of 2013.
It should be highlighted that, during the second quarter of 2014, Altri paid 8.6 million Euro of dividends.
In the first semester of 2014, the Group issued three bond loans in a total amount of 200 million Euro: one of 70 million Euro, with maturity in 2018, other of 80 million Euro, with maturity in 2019 and another of 50 million Euro, with maturity in 2020. All bond loans bear interest at variable rate, based on 6 months Euribor, with an average spread lower than 4%.
The cash generated and the refinancing operations referred above allow Altri to hold more than 338 million Euro in cash and cash equivalents on its balance sheet, ensuring already the full repayment of the bond loan "Celbi 2007/2015", amounting to 300 million Euro which matures in February 2015.
OUTLOOK FOR THE SECOND HALF OF 2014
At operational level, the second half of the year should be marked by the development of the project of transforming Caima in a producer of specialty pulp with greater value added and the deepening of projects aimed at enhancing operational efficiency, particularly in respect of specific consumptions.
In terms of market, the dynamics which occurred during the first half should remain during the second semester.
CORPORATE GOVERNANCE
According to legal provisions, the Company is not required to provide information relating to corporate governance, since it is compulsory only in conjunction with the annual Directors' report. The detailed annual corporate governance report is part of the Annual Report and Accounts of 2013 and is available on the website (www.altri.pt).
On this matter, it is important to mention that the Shareholders' General Meeting held on April 24, 2014 appointed the corporate boards for the period 2014/2016.
Thus, the Board of Directors appointed for the period 2014/2016:
- Paulo Jorge dos Santos Fernandes President
- João Manuel Matos Borges de Oliveira Vice-President
- Pedro Macedo Pinto de Mendonça Member
- Domingos José Vieira de Matos Member
- Laurentina da Silva Martins Member
- Pedro Miguel Matos Borges de Oliveira Member
- Ana Rebelo Carvalho Menéres de Mendonça Member
For the Statutory Audit Board the following members were appointed:
- Pedro Nuno Fernandes de Sá Pessanha da Costa President
- André Seabra Ferreira Pinto Member
- José Guilherme Barros Silva Member
- Luis Filipe Alves Baldaque de Marinho Fernandes Substitute
The Statutory Auditor appointed for the period 2014/2016 was Deloitte & Associados, SROC SA, represented by Jorge Manuel Araújo Beja Neves or Miguel Nuno Machado Canavarro Fontes.
LEGAL MATTERS
Own shares
Pursuant to the requirements of article 66 of the Commercial Company Code ("Código das Sociedades Comerciais"), the Directors inform that as of 30 June 2014 Altri and its subsidiaries had no own shares and did not acquire or sell any own shares during the period.
Shares held by Altri's corporate boards
Pursuant to the requirements of article 447 of the Commercial Companies Code ("Código das Sociedades Comerciais"), the Directors inform that, as of 30 June 2014, the held shares were as follows:
| Paulo Jorge dos Santos Fernandes (a) | 24,043,168 |
|---|---|
| Pedro Macedo Pinto de Mendonça | 1,705,000 |
| Domingos José Vieira de Matos (b) | 22,603,496 |
| João Manuel Matos Borges de Oliveira (c) | 29,000,000 |
| Laurentina da Silva Martins | 0 |
| Pedro Miguel Matos Borges de Oliveira | 12,905,000 |
| Ana Rebelo Carvalho Menéres de Mendonça (d) | 42,586,911 |
(a) – Besides 21,643,168 Altri shares held on a personal basis by Paulo Jorge dos Santos Fernandes, there are also attributable 2,400,000 Altri shares held by ACTIUM CAPITAL – SGPS, S.A., of which he is dominant shareholder and director. Thus, in legal terms, a total 24,043,168 shares are attributable to Paulo Jorge dos Santos Fernandes, representing 11.72% of Altri's capital and voting rights.
(b) – Besides 13,939,432 Altri, SGPS, S.A. shares held on a personal basis by Domingos José Vieira de Matos, there are also attributable 8,664,064 Altri shares held by LIVREFLUXO – SGPS, S.A., of which he is the dominant shareholder and director. Thus, in legal terms, a total of 22,603,496 shares are attributable to Domingos José Vieira de Matos, representing 11.02% of Altri's capital and voting rights.
(c) – The 29,000,000 shares represent Altri, SGPS, S.A. total shares held by CADERNO AZUL – SGPS, S.A., where João Manuel Matos Borges de Oliveira is director and shareholder.
(d) – The 42,586,911 shares represent Altri, SGPS, S.A. total shares held by PROMENDO – SGPS, S.A., where Ana Rebelo Carvalho Menéres de Mendonça is director and dominant shareholder.
As of 30 June 2014, the Statutory Auditor, the members of the Statutory Audit Board and of the Shareholders' General Meeting held no shares of the Company.
Participation in the Company's capital
Pursuant to the requirements of articles 16 and 20 of the Securities Market Code ("Código de Valores Mobiliários") and article 448 of the Commercial Companies Code ("Código das Sociedades Comerciais"), the Directors inform that, in accordance with the notifications received, the companies and/or individuals that hold qualified participations exceeding 2%, 5%, 10%, 20%, 33% and 50% of the voting rights, are as follows:
| Exceeding 2% of the voting rights | Shares Held | Direct % of the voting rights |
|---|---|---|
| LIVREFLUXO – SGPS, S.A. (a) | 8,664,064 | 4.22% |
| Lazard Frères Gestion SAS (b) | 4,157,000 | 2.03% |
| Norges Bank | 4,149,572 | 2.02% |
(a) The 8,664,064 shares of Altri, SGPS, SA held by LIVREFLUXO - SGPS, SA are attributable to Domingos José Vieira de Matos, since he is its director and dominant shareholder.
(b) The 4,157,000 shares are held by the SICAV OBJECTIF EURO SMALL CAPS. Having SICAV delegated the exercise of voting rights in Lazard Frères Gestion SAS, this participation is considered attributable to Lazard Frères Gestion SAS.
| Direct % of the voting | ||
|---|---|---|
| Exceeding 5% of the voting rights | Shares Held | rights |
| Domingos José Vieira de Matos (a) | 13,939,432 | 6.80% |
| Pedro Miguel Matos Borges de Oliveira | 12,905,000 | 6.29% |
| Bestinver Gestión S,A,, SGIIC (b) | 12,329,918 | 6.01% |
- (a) Besides 13,939,432 Altri, SGPS, S.A. shares held on a personal basis by Domingos José Vieira de Matos, there are also attributable 8,664,064 Altri shares held by LIVREFLUXO – SGPS, S.A., of which he is the dominant shareholder and director. Thus, in legal terms, a total of 22,603,496 shares are attributable to Domingos José Vieira de Matos, representing 11.02% of Altri's capital and voting rights.
- (b) Includes 4,103,653 shares, corresponding to 2% of Altri's capital and voting rights held by BESTINVER BAG, FI.
| Direct % of the voting | ||
|---|---|---|
| Exceeding 10% of the voting rights | Shares held | rights |
| Caderno Azul, SGPS, S.A. (a) | 29,000,000 | 14.14% |
| Paulo Jorge dos Santos Fernandes (b) | 21,643,168 | 10.55% |
- (a) The 29,000,000 shares represent Altri, SGPS, S.A. total shares held by CADERNO AZUL SGPS, S.A., where João Manuel Matos Borges de Oliveira is director and dominant shareholder.
- (b) There are also attributable to Paulo Jorge dos Santos Fernandes 2,400,000 shares of Altri, SGPS, SA held by ACTIUM CAPITAL - SGPS, SA, of which he is the dominant shareholder and director. Thus, in legal terms, are attributable to Paulo Jorge dos Santos Fernandes a total of 24,043,168 shares, representing 11.72% of capital and voting rights of Altri, SGPS, SA
| Direct % of the voting | ||
|---|---|---|
| Exceeding 20% of the voting rights | Shares held | rights |
| PROMENDO – SGPS, S.A. (a) | 42.586.911 | 20,76% |
(a) The 42,586,911 shares represent Altri, SGPS, S.A. total shares held by PROMENDO – SGPS, S.A., where Ana Rebelo Carvalho Menéres de Mendonça is director and dominant shareholder.
Altri was not notified of any holdings above 33% of the voting rights.
STATEMENT UNDER ARTICLE 246, PARAGRAPH 1, C) OF THE SECURITIES CODE
The signatories individually declare that, to their knowledge, the Condensed Consolidated Financial Statements prepared in accordance with the International Accounting Standard 34 – Interim Financial Reporting, and other accounting documents required by law or regulation, giving a truthful (fairly) and appropriate image, in all material respects, of the assets and liabilities, financial position and the consolidated and individual results of Altri, SGPS, S.A. ("Altri") and of the companies included in the consolidation perimeter and contains a description of the major risks and uncertainties that they face.
DECLARATION OF RESPONSIBILITY
The members of the Board of Directors of Altri, S.G.P.S., S.A. declare that they assume responsibility for this information and affirm that the items included herein are true and that, to the best of their knowledge, there are no omissions.
As required by article 8, nr. 3, of the Stock Exchange Regulation, the Board of Directors declares that the financial statements that integrate this report were not subject to Limited Review.
As required by article 21 of Decree-Law 411/91 of 17 October, the Board of Directors informs that there are no overdue debts to the State, namely with respect to Social Security.
CLOSING REMARKS
The Board of Directors don't want to conclude without expressing a vote of thanks to our suppliers, financial institutions and other partners in the group for their trust in our organization. Finally, we would like to express our gratitude to all our employees for their dedication and commitment.
Oporto, July 31th 2014
The Board of Directors:
Paulo Jorge dos Santos Fernandes
_____________________________________
_____________________________________
_____________________________________
_____________________________________
_____________________________________
_____________________________________
João Manuel Matos Borges de Oliveira
Pedro Macedo Pinto de Mendonça
Domingos José Vieira de Matos
Laurentina da Silva Martins
Pedro Miguel Matos Borges de Oliveira
_____________________________________ Ana Rebelo Carvalho Menéres de Mendonça
Article 447 of the Commercial Companies Code ("Código das Sociedades Comerciais") and article 14 nr. 7 of the Portuguese Securities Regulator (CMVM) Regulation nr. 05/2008
Disclosure of shares and other securities held by the Board of Directors and by those discharging managerial responsibilities, as well as people with these closely related, in accordance with Article 248. B of the Portuguese Securities Code, and transactions made on them during the semester.
| Shares held at 31 | Shares held at 30 | |||
|---|---|---|---|---|
| Member of the Board of Directors | Dec 2013 | Acquisitions | Disposals | Jun 2014 |
| Paulo Jorge dos Santos Fernandes | 21,643,168 | - | - | 21,643,168 |
| Paulo Jorge dos Santos Fernandes(imputação via ACTIUM CAPITAL - SGPS, S.A.) | 2,400,000 | - | - | 2,400,000 |
| Pedro Macedo Pinto de Mendonça | 1,705,000 | - | - | 1,705,000 |
| João Manuel Matos Borges de Oliveira (imputação via CADERNO AZUL - SGPS, S.A.) | 29,000,000 | - | - | 29,000,000 |
| Domingos José Vieira de Matos | 13,939,432 | - | - | 13,939,432 |
| Domingos José Vieira de Matos (imputação via LIVREFLUXO - SGPS, S.A.) | 8,664,064 | - | - | 8,664,064 |
| Pedro Miguel Matos Borges de Oliveira (1) | 12,905,000 | - | - | 12,905,000 |
| Ana Rebelo Carvalho Menéres de Mendonça (imputação via PROMENDO - SGPS, S.A.) (1) | 42,586,911 | - | - | 42,586,911 |
(1) the initial number of shares corresponds to the shares held on the date that these directors were appointed to the Board of Directors (24-04-2014)
ALTRI, SGPS, S.A.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2014 AND 31 DECEMBER 2013
(Translation of financial statements originally issued in Portuguese – Note 20) (Amounts expressed in Euro)
| ASSETS | Notes | 30.06.2014 | 31.12.2013 |
|---|---|---|---|
| NON CURRENT ASSETS: | |||
| Biological assets | 107.383.054 | 107.122.952 | |
| Tangible fixed assets | 385.086.477 | 390.512.538 | |
| Investment property | 456.936 | 460.627 | |
| Goodwill | 265.531.404 | 265.531.404 | |
| Intangible assets | 140.180 | 194.285 | |
| Investments in associated companies and joint ventures | 4.2 | 8.770.274 | 8.642.309 |
| Investments available for sale | 4.3 | 12.116.910 | 14.656.909 |
| Other non current assets | 3.656.926 | 3.071.539 | |
| Deferred tax assets | 7 | 31.022.015 | 31.165.814 |
| Total non current assets | 814.164.176 | 821.358.377 | |
| CURRENT ASSETS: | |||
| Inventories | 57.365.524 | 54.829.315 | |
| Customers | 74.220.545 | 80.294.638 | |
| Other debtors | 9.747.263 | 7.562.193 | |
| State and other public entities | 19.332.742 | 20.223.728 | |
| Other current assets | 7.220.779 | 3.454.873 | |
| Derivatives | 11 | 844.070 | 1.204.184 |
| Cash and cash equivalents | 6 | 338.257.408 | 232.450.518 |
| Total current assets | 506.988.331 | 400.019.449 | |
| Total assets | 1.321.152.507 | 1.221.377.826 | |
| SHAREHOLDERS' FUNDS AND LIABILITIES | 30.06.2014 | 31.12.2013 | |
| SHAREHOLDERS' FUNDS: | |||
| Share capital | 8 | 25.641.459 | 25.641.459 |
| Legal reserve | 3.405.143 | 2.862.981 | |
| Other reserves | 205.158.113 | 157.811.081 | |
| Consolidated net profit / (loss) | 12.699.416 | 55.347.961 | |
| Total shareholders' funds attributable to the parent company's shareholders | 246.904.131 | 241.663.482 | |
| Non controlling interests | 146.744 | 146.308 | |
| Total Shareholders' funds | 247.050.875 | 241.809.790 | |
| LIABILITIES: | |||
| NON CURRENT LIABILITIES: | |||
| Bank loans | 9 | 104.325.000 | 74.212.500 |
| Other loans | 9 | 336.457.986 | 439.370.297 |
| Reimbursable incentives | 9 | 15.744.356 | 11.228.419 |
| Other non current creditors | 404.350 | 404.350 | |
| Other non current liabilities | 29.772.923 | 32.384.801 | |
| Deferred tax liabilities | 7 | 17.745.293 | 17.896.214 |
| Provisions | 10 | 5.176.817 | 5.123.914 |
| Total non current liabilities | 509.626.725 | 580.620.495 | |
| CURRENT LIABILITIES: | |||
| Bank loans | 9 | 1.328.181 | 78.693.353 |
| Other loans | 9 | 451.912.736 | 213.719.587 |
| Reimbursable incentives | 9 | 4.009.904 | 71.008 |
| Suppliers | 57.231.362 | 60.034.597 | |
| Other current creditors | 7.222.007 | 6.395.461 | |
| State and other public entities | 1.759.791 | 1.914.156 | |
| Other current liabilities | 37.009.872 | 31.630.830 | |
| Derivatives Total current liabilities |
11 | 4.001.054 564.474.907 |
6.488.549 398.947.541 |
| Total shareholders' funds and liabilities | 1.321.152.507 | 1.221.377.826 |
The accompanying notes form an integral part of the consolidated financial statements.
ALTRI, SGPS, S.A.
CONSOLIDATED STATEMENTS OF PROFIT AND LOSS FOR THE SIX AND THREE MONTHS PERIODS ENDED 30 JUNE 2014 AND 2013
(Translation of financial statements originally issued in Portuguese – Note 20) (Amounts expressed in Euro)
| SEMESTER ENDED | QUARTER ENDED | ||||
|---|---|---|---|---|---|
| Notes | 30.06.2014 | 30.06.2013 | 30.06.2014 | 30.06.2013 | |
| Sales | 254.923.847 | 285.837.991 | 130.331.997 | 145.507.807 | |
| Services rendered | 4.370.377 | 4.299.950 | 2.184.232 | 2.143.020 | |
| Other income | 14 | 4.407.320 | 5.350.918 | 2.409.490 | 2.651.215 |
| Cost of sales | (124.444.620) | (123.831.518) | (62.023.674) | (62.599.000) | |
| External supplies and services | (71.520.067) | (74.588.161) | (39.066.486) | (36.659.094) | |
| Payroll expenses | (13.921.039) | (13.504.254) | (7.010.323) | (6.763.765) | |
| Amortisation and depreciation | (25.155.810) | (24.638.510) | (12.576.794) | (12.265.787) | |
| Provisions and other impairment losses | 10 | (52.903) | (627.755) | (30.670) | (627.755) |
| Other expenses | 15 | (1.555.154) | (7.608.790) | (814.289) | (4.628.127) |
| Other indirect taxes | 10 | - | (2.722.651) | - | (2.722.651) |
| Gains and losses in associated companies and joint ventures | 4.2 | 1.252.965 | 1.109.089 | 944.654 | 634.980 |
| Financial expenses | 12 | (17.799.483) | (14.618.769) | (10.393.345) | (6.768.780) |
| Financial income | 12 | 3.195.938 | 1.973.006 | 1.664.431 | 691.158 |
| Profit before income tax | 13.701.371 | 36.430.546 | 5.619.223 | 18.593.221 | |
| Income tax | (1.001.519) | (6.164.142) | (586.535) | (2.525.924) | |
| Consolidated net profit | 12.699.852 | 30.266.404 | 5.032.688 | 16.067.297 | |
| Attributable to: | |||||
| Parent company's shareholders | 13 | 12.699.416 | 30.256.290 | 5.033.053 | 16.061.059 |
| Non controlling interests | 436 | 10.114 | (365) | 6.238 | |
| 12.699.852 | 30.266.404 | 5.032.688 | 16.067.297 | ||
| Earnings per share: | |||||
| Basic | 13 | 0,06 | 0,15 | 0,02 | 0,08 |
| Diluted | 13 | 0,06 | 0,15 | 0,02 | 0,08 |
The accompanying notes form an integral part of the consolidated financial statements.
ALTRI, S.G.P.S., S.A.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE SIX AND THREE MONTHS PERIODS ENDED 30 JUNE 2014 AND 2013
(Translation of financial statements originally issued in Portuguese – Note 20) (Amounts expressed in Euro)
| SEMESTER ENDED | QUARTER ENDED | |||
|---|---|---|---|---|
| 30.06.2014 | 30.06.2013 | 30.06.2014 | 30.06.2013 | |
| Net consolidated profit / (loss) for the period | 12.699.852 | 30.266.404 | 5.032.688 | 16.067.297 |
| Other comprehensive income: Items that will not be reclassified to profit or loss |
- - |
- - |
- - |
- - |
| Items that may be reclassified to profit or loss Change in fair value of cash flow hedging derivatives Change in fair value of available for sale investments |
1.166.706 - 1.166.706 |
1.642.400 (22.200) 1.620.200 |
135.179 186.122 321.301 |
3.758.288 7.800 3.766.088 |
| Other comprehensive income | 1.166.706 | 1.620.200 | 321.301 | 3.766.088 |
| Total comprehensive income for the period | 13.866.558 | 31.886.604 | 5.353.989 | 19.833.385 |
| Attributable to: Shareholders' of the parent company Non controlling interests |
13.866.122 436 |
31.876.490 10.114 |
5.354.354 (365) |
19.827.147 6.238 |
The accompanying notes form an integral part of the consolidated financial statements.
ALTRI, S.G.P.S., S.A.
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE SIX MONTHS PERIODS ENDED 30 JUNE 2014 AND 2013
(Translation of financial statements originally issued in Portuguese – Note 20) (Amounts expressed in Euro)
| Attributable to the parent company's shareholders | ||||||||
|---|---|---|---|---|---|---|---|---|
| Notes | Share capital | Legal reserve | Others reserves |
Net profit | Total | Non controlling interests |
Total shareholder's funds |
|
| Balance as of 1 January 2013 | 25.641.459 | 2.862.981 | 103.112.415 | 52.181.891 | 183.798.746 | 128.166 | 183.926.912 | |
| Appropriation of the consolidated net profit of 2012 Dividends |
- - |
- - |
52.181.891 (5.128.292) |
(52.181.891) - |
- (5.128.292) |
- - |
- (5.128.292) |
|
| Others | - | - | (320) | - | (320) | - | (320) | |
| Total comprehensive income for the period | - | - | 1.620.200 | 30.256.290 | 31.876.490 | 10.114 | 31.886.604 | |
| Balance as of 30 June 2013 | 25.641.459 | 2.862.981 | 151.785.894 | 30.256.290 | 210.546.624 | 138.280 | 210.684.904 | |
| Balance as of 1 January 2014 | 25.641.459 | 2.862.981 | 157.811.081 | 55.347.961 | 241.663.482 | 146.308 | 241.809.790 | |
| Appropriation of the consolidated net profit of 2013 | - | 542.162 | 54.805.799 | (55.347.961) | - | - | - | |
| Dividends | 18 | - | - | (8.615.530) | - | (8.615.530) | - | (8.615.530) |
| Others | - | - | (9.943) | - | (9.943) | - | (9.943) | |
| Total comprehensive income for the period | - | - | 1.166.706 | 12.699.416 | 13.866.122 | 436 | 13.866.558 | |
| Balance as of 30 June 2014 | 8 | 25.641.459 | 3.405.143 | 205.158.113 | 12.699.416 | 246.904.131 | 146.744 | 247.050.875 |
The accompanying notes form an integral part of the consolidated financial statements.
ALTRI , SGPS, S.A.
CONDENSED CONSOLIDATED CASH-FLOW STATEMENTS FOR THE SIX AND THREE MONTHS PERIODS ENDED 30 JUNE 2014 AND 2013
(Translation of financial statements originally issued in Portuguese – Note 20) (Amounts expressed in Euro)
| SEMESTER ENDED | QUARTER ENDED | |||||
|---|---|---|---|---|---|---|
| Notes | 30.06.2014 | 30.06.2013 | 30.06.2014 | 30.06.2013 | ||
| Operating activities: | ||||||
| Cash flow from operating activities (1) | 48.546.940 | 66.355.871 | 34.845.847 | 38.750.278 | ||
| Investment activities: | ||||||
| Collections relating to: | ||||||
| Investments | 6 | 1.125.000 | 12.000 | - | 12.000 | |
| Tangible assets | 1.200 | 305.916 | - | 280.971 | ||
| Intangible assets | 30.192 | - | 30.192 | - | ||
| Interest and similar income | 2.062.555 | 1.735.257 | 1.295.609 | 1.640.035 | ||
| Investment subsidies | 8.454.834 | 612.843 | 143.220 | 555.723 | ||
| Payments relating to: | ||||||
| Investments | 6 | - | (2.973.844) | - | (2.961.094) | |
| Investment subsidies | (747.939) | (4.035.948) | (747.939) | - | ||
| Tangible assets | (19.231.802) | (6.902.495) | (13.491.956) | (3.521.285) | ||
| Cash flow from investment activities (2) | (8.305.960) | (11.246.271) | (12.770.874) | (3.993.650) | ||
| Financing activities: | ||||||
| Collections relating to: | ||||||
| Loans obtained | 415.915.011 | 103.230.087 | 153.628.545 | 99.281.852 | ||
| Payments relating to: | ||||||
| Loans obtained | (325.106.564) | (32.709.729) | (131.836.071) | (9.005.382) | ||
| Interest and similar costs | (17.437.150) | (19.838.216) | (4.634.465) | (5.401.680) | ||
| Distribution of dividends | 18 | (8.615.530) | (5.128.292) | (8.615.530) | (5.128.292) | |
| Cash flow from financing activities (3) | 64.755.767 | 45.553.850 | 8.542.479 | 79.746.498 | ||
| Cash and cash equivalents at the beginning of the period | 232.371.783 | 110.624.494 | 306.751.077 | 96.784.818 | ||
| Variation of cash and cash equivalents: (1)+(2)+(3) | 104.996.747 | 100.663.450 | 30.617.453 | 114.503.126 | ||
| Cash and cash equivalents at the end of the period | 6 | 337.368.530 | 211.287.944 | 337.368.530 | 211.287.944 |
The accompanying notes form an integral part of the consolidated financial statements.
(Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
1. INTRODUCTORY NOTE
Altri, SGPS, S.A. ("Altri" or "Company") was incorporated as of 1 March 2005, has its head-office located at Rua General Norton de Matos, 68, r/c – Porto, Portugal and its shares are listed in the NYSE Lisbon Euronext Stock Exchange. Its main activity is the management of investments.
Altri is the parent company of a group of companies listed in Note 4 known as Altri Group. The current activity of Altri Group focuses on the production of bleached paper pulp of eucalyptus through three production units (Celbi in Figueira da Foz, Caima in Constância do Ribatejo and Celtejo in Vila Velha de Ródão).
Due to this reality of Altri Group, the Board of Directors believes that there is only one business segment (production and commercialization of bleached paper pulp from eucalyptus) and the management information is also analyzed on this basis, for which the segmental information mentioned in Note 16 is limited by this.
The consolidated financial statements of Altri Group are presented in Euro rounded off to the unit, which is the currency used by the Group in its operations and considered as the functional currency.
2. MAIN ACCOUNTING POLICIES AND BASIS FOR PRESENTATION
The consolidated financial statements as of 30 June 2014 were prepared using accounting policies consistent with the International Financial Reporting Standards and in accordance with the International Accounting Standard and International Accounting Standard 34 – Interim Financial Reporting and includes the statement of financial position, the statement of profit and loss, the statement of comprehensive income, the statement of changes in equity and the condensed statement of cash flows as well as the selected explanatory notes.
The accounting policies used in the preparation of the consolidated financial statements of Altri are consistent with those used in the year ended 31 December 2013.
3. CHANGES IN ACCOUNTING POLICIES AND CORRECTION OF MISTAKES
During the period there were no changes in accounting policies and were identified no material mistakes related to previous years.
ALTRI, S.G.P.S., S.A. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF 30 JUNE 2014 (Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
4. INVESTMENTS
4.1 INVESTMENTS IN SUBSIDIARIES
The companies included in the consolidated financial statements by the full consolidation method, its headquarters, percentage participation held and main activity as of 30 June 2014 and 31 December 2013, are as follows:
| Company | Head Office | Percentage Held | Main activity | |
|---|---|---|---|---|
| Mother-Company: | 2014 | 2013 | ||
| Altri, SGPS, S.A. | OPorto | Investment management | ||
| Subsidiaries: | ||||
| Altri - Energias Renováveis, SGPS, S.A. |
Vila Velha de Ródão 99,83% | 99,83% | Investment management | |
| Altri Florestal, S.A. | Figueira da Foz | 100% | 100% | Sylvan exploration |
| Altri Sales, S.A. | Nyon, Suiça | 100% | 100% | Group management support services |
| Altri, Participaciones Y Trading, S.L. | Madrid, Espanha | 100% | 100% | Commercialization of pulp |
| Caima Energia – Empresa de Gestão e Exploração de Energia, S.A. | Constância | 100% | 100% | Production of thermal and electrical energy |
| Caima Indústria de Celulose, S.A. | Constância | 100% | 100% | Production and commercialization of pulp |
| Captaraíz Unipessoal, Lda. | Figueira da Foz | 100% | 100% | Property buying and selling |
| Celbinave – Tráfego e Estiva SGPS, Unipessoal, Lda. | Figueira da Foz | 100% | 100% | Freightage of ships |
| Celtejo – Empresa de Celulose do Tejo, S.A. | Vila Velha de Ródão 99,83% | 99,83% | Production and Commercialization of pulp | |
| Celulose Beira Industrial (Celbi), S.A. | Figueira da Foz | 100% | 100% | Production and Commercialization of pulp |
| Celulose do Caima, SGPS, S.A. | Figueira da Foz | 100% | 100% | Investment management |
| Inflora – Sociedade de Investimentos Florestais, S.A. | Figueira da Foz | 100% | 100% | Sylvan exploration |
| Invescaima – Investimentos e Participações, SGPS, S.A. | Figueira da Foz | 100% | 100% | Investment management |
| Pedro Frutícola, Sociedade Frutícola, S.A. | Constância | 100% | 100% | Agriculture production |
| Viveiros do Furadouro Unipessoal, Lda. | Óbidos | 100% | 100% Production of plants in nurseries and services related w ith forests and landscapes |
All the above companies were included in the Altri Group consolidated financial statements in accordance with the full consolidation method.
4.2 INVESTMENTS IN ASSOCIATED COMPANIES AND JOINT VENTURES
The associated companies and joint ventures, percentage of capital held and main activity as of 30 June 2014 and 31 December 2013 are as follows:
| Company | Percentage held | Main activity | |
|---|---|---|---|
| 2014 | 2013 | ||
| Associated companies: | |||
| Operfoz – Operadores do Porto da Figueira da Foz, Lda. | 33,33% | 33,33% | Harbor operations |
| Joint ventures: | |||
| EDP – Produção Bioeléctrica, S.A. | 50% | 50% | Electric energy production |
Those associated companies and joint ventures were included in the Altri Group consolidated financial statements in accordance with the equity method.
(Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
The book value, net assets, equity and net profit for the period ended on 30 June 2014 for these associated companies and joint ventures are as follows:
| Company | Book value (a) | Asset | Equity | Net profit |
|---|---|---|---|---|
| Associated companies: | ||||
| Operfoz – Operadores do Porto da Figueira da Foz, Lda. | 687.996 | 3.899.298 | 2.063.988 | 523.891 |
| Joint ventures: | ||||
| EDP – Produção Bioeléctrica, S.A. | 8.082.278 141.763.050 19.467.226 2.079.945 | |||
| 8.770.274 |
(a) – includes loans granted.
4.3 INVESTMENTS AVAILABLE FOR SALE
As of 30 June 2014 and 31 December 2013 the investments available for sale are as follows:
| Company | Book value | |
|---|---|---|
| 2014 | 2013 | |
| Rigor Capital - Produção de Energia. Lda. |
10.527.397 | 10.527.397 |
| Other investments | 1.589.513 | 4.129.512 |
| 12.116.910 | 14.656.909 |
Altri Group believes that the book value of investments available for sale, which include financial investments under 20% in companies where Altri Group has no significant influence on its management and are recorded at cost, net of impairment losses according to the accounting policy of the Note 2.3.l) i), does not differ significantly from its fair value.
"Other investments" corresponds mainly to listed shares which are recorded at their market value.
5. CHANGES OCCURED IN THE CONSOLIDATION PERIMETER
During the six months period ended 30 June 2014, there were no changes in the consolidation perimeter compared to 31 December 2013.
6. CASH AND CASH EQUIVALENTS
As of 30 June 2014 and 2013, the caption "Cash and cash equivalents" can be detailed as follows:
| 30.06.2014 | 30.06.2013 | |
|---|---|---|
| Cash | 14.957 | 13.575 |
| Bank deposits | 338.242.451 | 211.274.369 |
| 338.257.408 | 211.287.944 | |
| Bank overdrafts (Note 9) | (888.878) | - |
| Cash and cash equivalents | 337.368.530 | 211.287.944 |
ALTRI, S.G.P.S., S.A. NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF 30 JUNE 2014 (Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
During the six months period ended 30 June 2014, collections related with investments were as follows:
| Transaction Amount |
Amount received |
|
|---|---|---|
| EDP – Produção Bioeléctrica, S.A. (a) | 1.125.000 | 1.125.000 |
| --------------- 1.125.000 |
---------------- 1.125.000 |
|
| (a) -Repayment of loans granted |
========= | ========= |
| Transaction amount |
Amount received |
|
|---|---|---|
| Sócasca –Recolha e Comércio de Recicláveis, S.A. | 2.300.000 | 12.000 |
| (Sold in 2011) | --------------- 2.300.000 |
---------------- 12.000 |
| ========= | ========= |
During the six months period ended 30 June 2013, collections related with investments were as follows:
During the six months period ended 30 June 2013, payments related with investments were as follows:
| Transaction amount |
Amount paid |
|
|---|---|---|
| Other investments available for sale (Note 4.3) | 2.973.844 | 2.973.844 |
| --------------- 2.973.844 |
---------------- 2.973.844 |
|
| ========= | ========= |
7. CURRENT AND DEFERRED TAXES
In accordance with current legislation, tax returns are subject to review and correction by the tax authorities during a four-year period (five years for Social Security), with the exception when there have been tax losses, cases with there have been granted tax benefits, or tax inspections or claims are in progress, in which cases the periods may be extended or suspended. Therefore, the Company tax returns since 2010 are still subject to review.
The Board of Directors believes that any potential corrections resulting from reviews/inspections of these tax returns by the tax authorities will not have a significant effect on the consolidated financial statements as of 30 June 2014.
(Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
The movements occurred in deferred tax assets and liabilities in the six months periods ended in 30 June 2014 and 2013 were as follows:
| 2014 | |||
|---|---|---|---|
| Deferred tax assets | Deferred tax liabilities | ||
| Opening balance as of 1.1.2014 | 31.165.814 | 17.896.214 | |
| Effects on income statement: | |||
| Harmonization of depreciation rates | 669.034 | - | |
| Other effects | (312.653) | (29.523) | |
| Total effect on income statement | 356.381 | (29.523) | |
| Effect on shareholders' funds: | |||
| Fair values of derivatives | (500.180) | (121.398) | |
| Closing balance as of 30.06.2014 | 31.022.015 | 17.745.293 | |
| Deferred tax assets | 2013 Deferred tax liabilities |
||
| Opening balance as of 1.1.2013 | 33.357.371 | 16.931.978 | |
| Effects on income statement: | |||
| Harmonization of depreciation rates | 678.406 | - | |
| Other effects | (242.216) | 369.581 | |
| Total effect on income statement | 436.190 | 369.581 | |
| Effect on shareholders' funds: | |||
| Fair values of derivatives | (1.561.143) | - | |
| Closing balance as of 30.06.2013 | 32.232.418 | 17.301.559 |
8. SHARE CAPITAL
As of 30 June 2014 the Company's fully subscribed and paid up capital consisted of 205,131,672 shares with a nominal value of 12.5 cents of a Euro each.
(Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
9. BANK LOANS, OTHER LOANS AND REIMBURSABLE INCENTIVES
As of 30 June 2014 and 31 December 2013, the captions "Bank loans", "Other loans" and "Reimbursable incentives" can be detailed as follows:
| Nominal Value | Book Value | |||||
|---|---|---|---|---|---|---|
| Current | Non current | Total | Current | Non current | Total | |
| Bank loans | 666.437 | 105.000.000 | 105.666.437 | 439.303 | 104.325.000 | 104.764.303 |
| Bank overdrafts (Note 6) | 888.878 | - | 888.878 | 888.878 | - | 888.878 |
| Bank loans | 1.555.315 | 105.000.000 | 106.555.315 | 1.328.181 | 104.325.000 | 105.653.181 |
| Commercial paper | 122.900.000 | 64.000.000 | 186.900.000 | 121.287.480 | 63.391.721 | 184.679.201 |
| Bonds | 300.000.000 | 275.000.000 | 575.000.000 | 298.915.328 | 273.066.265 | 571.981.593 |
| Other loans | 31.736.594 | - | 31.736.594 | 31.709.928 | - | 31.709.928 |
| Other loans | 454.636.594 | 339.000.000 | 793.636.594 | 451.912.736 | 336.457.986 | 788.370.722 |
| Reimbursable incentives | 4.009.904 | 15.744.356 | 19.754.260 | 4.009.904 | 15.744.356 | 19.754.260 |
| 460.201.813 | 459.744.356 | 919.946.169 | 457.250.821 | 456.527.342 | 913.778.163 |
| 31-12-2013 | ||||||
|---|---|---|---|---|---|---|
| Nominal Value | ||||||
| Current | Non current | Total | Current | Non current | Total | |
| Bank loans | 78.877.288 | 75.000.000 | 153.877.288 | 78.614.615 | 74.212.500 | 152.827.115 |
| Bank overdrafts | 78.738 | - | 78.738 | 78.738 | - | 78.738 |
| Bank loans | 78.956.026 | 75.000.000 | 153.956.026 | 78.693.353 | 74.212.500 | 152.905.853 |
| Commercial paper | 181.900.000 | 66.000.000 | 247.900.000 | 181.497.235 | 65.207.880 | 246.705.115 |
| Bonds | - | 375.000.000 | 375.000.000 | - | 374.162.417 | 374.162.417 |
| Other loans | 33.347.002 | - | 33.347.002 | 32.222.352 | - | 32.222.352 |
| Other loans | 215.247.002 | 441.000.000 | 656.247.002 | 213.719.587 | 439.370.297 | 653.089.884 |
| Reimbursable incentives | 71.008 | 11.228.419 | 11.299.427 | 71.008 | 11.228.419 | 11.299.427 |
| 294.274.036 | 527.228.419 | 821.502.455 | 292.483.948 | 524.811.216 | 817.295.164 |
As of 30 June 2014, there are no bank overdrafts used (500,000 Euro as of 31 December 2013), classified in the caption "Bank Loans".
The expenses incurred with the issuance of the loans are deducted to their nominal value and deferred and recognized as interest expenses during the period of the loan (Note 12).
(Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
10. ACCUMULATED PROVISIONS AND IMPAIRMENT LOSSES
The movements occurred in provisions and impairment losses for the six months periods ended at 30 June 2014 and 2013 can be detailed as follows:
| 30.06.2014 | ||||||
|---|---|---|---|---|---|---|
| Impairment losses in current | ||||||
| Provisions | assets | Total | ||||
| Opening balance | 5.123.914 | 9.505.979 | 14.629.893 | |||
| Increases | 52.903 | - | 52.903 | |||
| Utilizations | - | - | - | |||
| Closing balance | 5.176.817 | 9.505.979 | 14.682.796 |
| 30.06.2013 | |||||
|---|---|---|---|---|---|
| Impairment losses in current | |||||
| Provisions | assets | Total | |||
| Opening balance | 1.535.342 | 5.536.965 | 7.072.307 | ||
| Increases | 3.072.651 | 450.000 | 3.522.651 | ||
| Utilizations | - | (1.003.738) | (1.003.738) | ||
| Closing balance | 4.607.993 | 4.983.227 | 9.591.220 |
During the six months period ended in June 30 2013, the subsidiary Caima Indústria de Celulose, S.A., proceeded to the payment of an additional settlement of the Value Added Tax from previous years in the amount of 2,722,651 Euro which was recorded under the caption "Other non-current assets" for not agreeing with the fundamentals of that settlement. To face the risk of such settlement, Altri recorded a liability under the caption "Provisions" against the caption "Other indirect taxes" in the income statement.The remaining increase in provisions and impairment losses in the amount of 800,000 Euro, is recorded against the income statement caption "Provisions and other impairment losses".
The reduction of impairment losses verified in the six months period ended 30 June 2013 relates to the use of impairment losses in the amount of 831,493 Euro and reversals of impairment losses in the amount of 172,245 Euro.
The amount recorded under the caption "Provisions", at 30 June 2014 and 2013, is the best estimate of the Board of Directors in order to face all the losses that may be supported due to claims in progress.
11. DERIVATIVE FINANCIAL INSTRUMENTS
As of 30 June 2014 and 2013 the companies of Altri's Group had contracts concerning financial derivative instruments to hedge variations in pulp price and interest rates being these instruments registered according to their fair value.
The companies of Altri's Group only use derivatives to hedge cash flows from the operations generated by its activity.
(Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
As of 30 June 2014 and 2013 the detail of the financial derivative instruments is as follows:
| Pulp price hedging derivatives |
Interest rates derivatives |
Total | ||
|---|---|---|---|---|
| Opening balance as of 31.12.2013 | 720.362 | (6.004.727) | (5.284.365) | |
| Derivatives fair value variation/cessation Effects on shareholders' funds Effects on the profit and loss statement |
123.708 - |
1.422.340 581.333 |
1.546.048 581.333 |
|
| Closing balance as of 30.06.2014 | 844.070 | (4.001.054) | (3.156.984) | |
| Pulp price hedging derivatives |
Interest rates derivatives |
Exchange rate derivatives |
Total | |
| Opening balance as of 31.12.2012 | (8.696.330) | (13.417.466) | 261.783 | (21.852.013) |
| Derivatives fair value variation/cessation Effects on shareholders' funds Effects on the profit and loss statement |
1.872.392 - |
1.331.151 2.654.112 |
- (261.783) |
3.203.543 2.392.329 |
| Closing balance as of 30.06.2013 | (6.823.938) | (9.432.203) | - | (16.256.141) |
12. FINANCIAL RESULTS
The financial results for the six months periods ended at 30 June 2014 and 2013 are detailed as follows:
| 30.06.2014 | 30.06.2013 | |
|---|---|---|
| Financial expenses: | ||
| Interests | 9.975.325 | 10.681.676 |
| Other financial expenses | 7.824.158 | 3.937.093 |
| 17.799.483 | 14.618.769 | |
| Financial income: | ||
| Interests | 2.565.931 | 1.111.069 |
| Other financial income | 630.007 | 861.937 |
| 3.195.938 | 1.973.006 |
The caption "Other financial expenses" includes expenses incurred with the loans setup which are recognized in the profit and loss statement through the duration of those loans (Note 9), losses in investments available for sale (Note 4.3) and losses regarding interest rate financial derivative instruments (Note 11).
The "Gains and losses in associated companies and joint ventures" relate to the appropriation of the Group share in the results of the investments in associated companies and joint ventures (Note 4.2).
(Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
13. EARNINGS PER SHARE
Earnings per share in the six months periods ended as of 30 June 2014 and 2013 were calculated considering the following amounts:
| 30.06.2014 | 30.06.2013 | |
|---|---|---|
| Share number considered for the computation of basic and diluted earning | 205.131.672 | 205.131.672 |
| Net profit considered for the computation of basic and diluted earning | 12.699.416 | 30.256.290 |
| Earnings per share Basic Diluted |
0,06 0,06 |
0,15 0,15 |
14. OTHER INCOME
As of 30 June 2014 and 2013 the caption of the statement of profit and loss "Other Income" is detailed as follows:
| 30.06.2014 | 30.06.2013 | |
|---|---|---|
| Investment and exploration subsidies | 2.490.490 | 4.491.725 |
| Gains in commodities derivatives contracts (Note 11) | 301.458 | - |
| Other income | 1.615.372 | 859.193 |
| 4.407.320 | 5.350.918 |
15. OTHER EXPENSES
As of 30 June 2014 and 2013 the caption of the statement of profit and loss "Other expenses" is detailed as follows:
| 30-06-2014 | 30-06-2013 | |
|---|---|---|
| Direct taxes and charges | 838.109 | 867.779 |
| Losses in commodities derivatives contracts (Note 11) | - | 5.761.410 |
| Other costs | 717.048 | 979.601 |
| 1.555.157 | 7.608.790 |
16. SEGMENTAL INFORMATION
On 16 April 2008, the Board of Administration of Altri, S.G.P.S., S.A. approved a simple reorganization project of this society which implies the split of Altri's two business units that operates in the pulp and paper sector and in the steel and storage systems sector. This reorganization aimed a bigger focus and transparency on ALTRI's business, and giving each of the areas an opportunity to be better seen and better evaluated by the market, and allows Altri Group to focus its activity on its core business, production and commercialization of bleached paper pulp form eucalyptus, so the Board of Directors believe that there is only one business segment and the management information is reported and analyzed on this basis.
(Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
17. RELATED PARTIES
The subsidiary companies of the Group have between each other transactions that classify as transactions with related parties and which are made at market prices.
In the consolidation procedures the transactions between the companies included in consolidation by the full consolidation method are eliminated, once the consolidated financial statements present the owner and its subsidiaries information as one single company, therefore they are not disclosed in this note.
During the six months periods ended at 30 June 2014 and 2013, there were no transactions or loans granted to the members of the Board of Directors.
As of 30 June 2014 and 2013 the balances and transactions with related parties are as follow:
| Purchases and services | Sales and services | Interest income | ||||
|---|---|---|---|---|---|---|
| Transactions | 30.06.2014 | 30.06.2013 | 30.06.2014 | 30.06.2013 | 30.06.2014 | 30.06.2013 |
| Associated companies and joint ventures (a) | 1.590.445 | 773.972 | 7.751.841 | 2.512.339 | 155.141 | 160.466 |
| Other related parties (b) | 3.245.696 | 3.193.695 | - | - | - | - |
| 4.836.141 | 3.967.667 | 7.751.841 | 2.512.339 | 155.141 | 160.466 | |
| Accounts payable | Accounts receivable | Granted loans | ||||
| Balances | 30.06.2014 | 30.06.2013 | 30.06.2014 | 30.06.2013 | 30.06.2014 | 30.06.2013 |
| Associated companies and joint ventures (a) | 323.891 | 135.825 | 2.480.517 | 1.255.733 | 12.682.905 | 13.807.905 |
| Other related parties (b) | 31.459 | 14.823 | - | - | - | - |
| 355.350 | 150.648 | 2.480.517 | 1.255.733 | 12.682.905 | 13.807.905 |
(a) All entities consolidated by the equity method as of 30 June 2014 and 2013 (Note 4.2);
(b) Were considered as related parties the companies of Ramada Group.
Besides the transactions identified above, there are no other transactions with related companies.
Besides the companies included in consolidation (Note 4), entities considered as related parties as of 30 June 2014 can be detailed as follow:
Actium Capital, S.G.P.S., S.A. Adcom Media Anúncios e Publicidade, S.A. Alteria, S.G.P.S., S.A. Caderno Azul, S.G.P.S., S.A. Cofihold, S.G.P.S., S.A. Cofina Eventos e Comunicação, S.A. Cofina Media, SGPS, S.A. Cofina, SGPS, S.A. Destak Brasil – Editora de Publicações, S.A. Destak Brasil – Empreendimentos e Participações, S.A. Edirevistas – Sociedade Editorial, S.A. Edisport – Sociedade de Publicações, S.A. Efe Erre Participações, S.G.P.S., S.A. Elege Valor, S.G.P.S., S.A. F. Ramada – Aços e Indústrias, S.A. F. Ramada – Investimentos, SGPS, S.A. F. Ramada – Produção e Comercialização de Estruturas Metálicas de Armazenagem, S.A. F. Ramada II, Imobiliária, S.A. F. Ramada Serviços de Gestão, Lda. Grafedisport – Impressão e Artes Gráficas, S.A. Livrefluxo, S.G.P.S., S.A. Malva – Gestão Imobiliária, S.A. Mediafin, SGPS, S.A. Mercados Globais – Publicação de Conteúdos, Lda. Metronews – Publicações S.A.
ALTRI, S.G.P.S., S.A.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
AS OF 30 JUNE 2014
(Translation of notes originally issued in Portuguese – Note 20)
(Amounts expressed in Euro)
Presselivre – Imprensa Livre, S.A. Promendo, S.G.P.S., S.A. Sociedade Imobiliária Porto Seguro – Investimentos Imobiliários, S.A. Storax – Equipements, S.A. Storax Benelux Storax Racking Systems, Ltd. Torres da Luz – Investimentos Imobiliários, S.A. Transjornal – Edição de Publicações, S.A. Universal Afir – Aços, Máquinas e Ferramentas, S.A. Valor Autêntico, SGPS, S.A. VASP – Sociedade de Transportes e Distribuições, Lda Web Works – Desenvolvimento de Aplicações para Internet, S.A.
18. APPLICATION OF THE NET PROFIT
The Board of Directors proposed in its annual report, which was approved at the Shareholders' General meeting held on 24 April 2014, that the individual net profit of Altri amounting to 10,843,235.78 Euro would be allocated as follows:
| Legal reserve | 542,161.79 |
|---|---|
| Other reserves | 1,685,543.77 |
| Distribution of dividends | 8,615,530.22 |
| --------------------- | |
| 10,843,235.78 | |
| ============ |
19. FINANCIAL STATEMENTS APPROVAL
The financial statements were approved by the Board of Directors and authorized for issuance in 31 July 2014.
20. EXPLANATION ADDED FOR TRANSLATION
These condensed consolidated financial statements are a translation of financial statements originally issued in Portuguese, prepared using accounting policies consistent with the International Financial Reporting Standards and with accordance with the International Accounting Standard 34 – Interim Financial Reporting, some of which may not conform or be required by generally accepted accounting principles in other countries. In the event of discrepancies, the Portuguese language version prevails.
The Board of Directors,
Paulo Jorge dos Santos Fernandes – President
João Manuel Matos Borges de Oliveira – Vice-President
Pedro Macedo Pinto de Mendonça
Domingos José Vieira de Matos
Laurentina da Silva Martins
Pedro Miguel Matos Borges de Oliveira
Ana Rebelo de Carvalho Menéres de Mendonça