Annual Report • May 9, 2011
Annual Report
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| Registered office: | Avenue Reine Astrid 92 |
|---|---|
| B-1310 La Hulpe | |
| Tel.: | +32-2-387 22 99 |
| Fax: | +32-2-387 23 16 |
| Enterprise no. | VAT BE 0403 209 303 |
| RPM Nivelles | |
| E-mail: | [email protected] |
| Website: | www.atenor.be |
ATENOR GROUP has chosen French as its official language. Consequently, only the French text is authentic. The versions in Dutch and English are translations of the French version.
Dit jaarverslag is ook verkrijgbaar in het Nederlands. Ce rapport est également disponible en français.
| 6 | CONSOLIDATED INCOME STATEMENT |
|---|---|
| 7 | CONSOLIDATED BALANCE SHEET |
| 8 | CONSOLIDATED CASH FLOW STATEMENT |
| 9 | CONSOLIDATED STATEMENT OF CHANGES IN EQUITY |
| 10 | NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS |
| 10 | Note 1: Principal accounting methods |
| 15 | Note 2: Segment reporting |
| 16 | Note 3: Operating results |
| 16 | Note 4: Personnel charges |
| 17 | Note 5: Other operating expenses |
| 17 | Note 6: Financial results |
| 18 | Note 7: Income taxes |
| 19 | Note 8: Profit and dividend per share |
| 20 | Note 9: Capital |
| 22 | Note 10: Intangible assets |
| 24 | Note 11: Property, plant and equipment |
| 26 | Note 12: Investment property |
| 28 | Note 13: Investments consolidated by the equity method |
| 29 | Note 14: Related parties |
| 29 | Note 15: Inventories |
| 30 | Note 16: Current and non-current financial assets |
| 32 | Note 17: Other current and non-current assets |
| 33 | Note 18: Deferred tax assets and liabilities |
| 34 | Note 19: Provisions, risks and contingent liabilities |
| 34 | Note 20: Disputes |
| 35 | Note 21: Financial liabilities and payables |
| 38 | Note 22: Employee benefits |
| 39 | Note 23: Risks management |
| 41 | Note 24: Events after the balance sheet date |
| 42 | Note 25: Commitments and contingent liabilities |
| 43 | Note 26: Structure of the Group |
| 44 | STATEMENT BY THE MANAGEMENT |
| 45 | AUDIT REPORT |
| 47 | ANNUAL ACCOUNTS OF ATENOR GROUP S.A. |
| 48 | GENERAL INFORMATION |
We have the honour of presenting to you the Management Report of your company's 100th financial year and of submitting for your approval the Annual Accounts as at 31 December 2010, along with our proposals for the allocation of profits.
The consolidated results for 2010 amount to -1.60 million euro, compared with 7.32 million euro in 2009.
The turnover amounts to 10.74 million euro. This turnover mainly comprises the CROWNE PLAZA hotel activity (8.71 million euro) and the balance of the sales related to the MEDIA GARDENS project (0.89 million euro).
The operating income amounts to 3.48 million euro and is essentially derived from the sale of our SOUTH CITY OFFICE FONSNY and SOUTH CITY OFFICE BROODTHAERS holdings (€ 9.03 million euro) and the result recorded at the end of the first half of the year in connection with the PRESIDENT project (€1.27 million euro).
The net financial result amounts to 4.44 million euro impacted by the financial charges related to the successful bond issue of 18 January 2010.
Account taken, on the one hand, of the positive operating income derived thanks to the commercialisation of projects from our portfolio and, on the other, the net financial result, ATENOR's net income recorded a slight loss of €1.60 million euro.
As at 2010 December 31, the group has a net financial indebtedness of 46.99 million euro compared with a net financial indebtedness of 71.57 million euro as at 31 December 2009. The bond issue made it possible to reinforce the structure of ATENOR's balance sheet and devote the resources available to the furtherance of the projects in our portfolio in an economic climate in which the financial markets remained troubled.
During 2010, ATENOR GROUP acquired 33,580 own shares. As at 31 December 2010, ATENOR GROUP held 154,452 own shares acquired at an average price of 40.60 euro for a total amount of 6.27 million euro. These shares are intended to cover the 2007, 2008, 2009 and 2010 stock option plans.
Within a context of the slow recovery of the real estate market, we continued cautiously with the development of the projects in our portfolio and also made a targeted acquisition.
In addition, we are continuing with the analysis of various files in keeping with our strategy and the very strict criteria that we set ourselves regarding new acquisitions.
Below, we comment on each of our projects classified according to their degree of advancement.
After the sale of the company SOUTH CITY OFFICE FONSNY to the companies L'INTEGRALE and OGEO, last December, we sold the company SOUTH CITY OFFICE BROODTHAERS to the international insurance group ALLIANZ at very favourable market conditions bearing in mind the quality of the two tenants SMALS and SNCB Holding.
The company SOUTH CITY HOTEL, which already had a 20 year operating agreement with the Rezidor group, will complete work on the hotel in the near future enabling the operator to open the hotel on 1st March.
| Location | Chaussée de Louvain, Brussels, Belgium |
|---|---|
| Project | Residential housing units |
| Size | ± 28,700 m² |
Thanks to the success of the commercialisation by OPTIMA FINANCIAL PLANNERS in 2009 for the first part of the MEDIA GARDENS project, I.D.M. sa, a 100% subsidiary of ATENOR GROUP, received in 2010 the entire net proceeds of these sales amounting to 13.7 million euro.
During the course of 2010, ATENOR GROUP continued the construction of the second part of the MEDIA GARDENS project with a view to delivery of same in May 2011 (block of 75 apartments, which is 6,947 m² entirely sold to the SICAFI (fixed capital real estate investment trust) Aedifica).
Location Between the canal, the place des Armateurs and the quai de Willebroek, Brussels capital region, Belgium.
Project A combination of housing, shops and office units.
Size ± 80,000 m²
ATENOR GROUP obtained planning permission for the UP-site project in June 2010 and immediately began construction work consolidated by the signing of ad hoc financing. This mixed urban project located next to the canal in Brussels concerns 30,000 m² of offices, 13,000 m² of which have already found occupants (27 year lease signed by SMALS and acquisition signed by UNIZO and SVMB), and over 47,000 m² of housing units. The future 140-meter high (42 floor) residential tower has already established itself as a landmark in this district which is being entirely redeveloped.
The urban planning permit for this Romanian project was obtained in 2010.
After demolition work and preparation of the site, infrastructure work began during the last quarter of 2010 and is expected to be completed in September 2011. At the same time, an invitation to tender was issued for the infrastructure work of one of the project's three blocks and closed with a large number of favourable responses from the budgetary point of view. Analysis of these proposals will continue during the period.
| Location | Váci ut, 13th District, Budapest, Hungary |
|---|---|
| Project | Construction of office buildings |
| Size | Phase 1 - 56,000 m² |
We are about to finalise the second acquisition phase of this project whose development may also be phased.
| Location | Rue de la Loi and chaussée d'Etterbeek, Brussels capital region, Belgium |
|---|---|
| Project | A combination of shops and office units. |
| Size | ± 30,000 m² |
| Architect | Archi+ I |
After numerous discussions with the regional and communal authorities on the application for an urban planning permit made in December 2009, to our great satisfaction, we have learned that a Government Decree relating to the introduction of the implementation of the urban landscape law project, PUL, was published on 16 December 2010. The coordination meetings with the authorities concerned will take place during the 2011 period to determine new parameters of the volume of our construction.
In spite of the economic situation in this country, the launch of the commercialisation of the first phase of this project confirmed the intrinsic qualities of the project, although it has not been possible at this stage to predict when these commercial approaches will materialize. Region-City agreement, a regional development plan (SAR) is soon expected to be adopted, permitting submission of an application for an urban planning permit. Trebel
| Location | Rue Blérot – Place Victor Horta, Brussels, Belgium |
|---|---|
| Project | A combination of shops and office units. |
| Architects Atelier de Portzamparc (Paris) and Bureau d'Architecture M. & J-M. Jaspers – J. Eyers & Partners |
The urban planning permit for construction of a first block of offices allowing for the development of 15,400 m² was obtained in July 2010. The infrastructure work began after the signing of a contracting contract with CFE Hungary. Reflection is under way with a view to proposing a project for this plot of land situated along rue Bélliard and rue de Trèves in keeping with the changing environment.
In partnership (50/50) with CFE, we applied for an urban planning permit in December 2010. Consultation with the competent authorities and major players in the district is under way.
The rental market seems to be showing signs of recovery and, in spite of the economic situation in this country, we found the intrinsic qualities of the launch of the commercialisation of the first phase encouraging although at this stage, as with the Romanian market, it is not possible to predict when these commercial approaches will take shape. OPA Westland Shopping Center The public offer on the Westland Shopping Center 1980 was countered by a public offer issued by the AGEAS group.
Our architectural scheme for this location has always been densification for obvious reasons of mobility and the reinforcement of the use of public transport.
| Location | Area known as "Port du Bon Dieu", Namur, Belgium |
|---|---|
| Project | Housing programme |
| Size | ± 30,000 m² |
| Architects | Montois Partners Architects & l'Atelier de l'Arbre d'Or |
| Owner | Namur Waterfront |
In June 2008, ATENOR created the company NAMUR WATERFRONT to use it for a project located just outside the city of Namur, on the left bank of the Meuse River. This area is of strategic value in terms of access and mobility given that it situated not far from the railway station, the city centre and all its facilities. ATENOR has carried out studies for the construction of a residential complex of approximately 12,000 m² featuring the most pertinent ecological elements. Following a
Location Corner of rue Belliard and rue de Trèves in Brussels, Belgium. Project Offices building Size ± 17,000 m²
Finally, ATENOR GROUP has made a new acquisition in the European district of Brussels.
On 1st February 2011 ATENOR GROUP issued a total of 53,200 options on own shares intended for members of the Management and the Staff.
In view of the quality of its diversified portfolio and its cash situation, ATENOR GROUP is in a good position to pursue the development of its projects in a market showing the first signs of recovery. The construction and delivery of pre-sold, pre-leased properties in particular is expected to contribute positively to the 2011 results.
Background: the Board of Directors of 3 March 2009 approved a new Stock Option Plan for three years. Therefore as at 2 February 2010 ATENOR GROUP issued a first tranche of 50,000 options on own shares intended for members of the Management and the Staff. These options can be exercised during the periods from 11 March to 11 April 2014 and from 2 to 30 September 2014 at the unit price of € 36.18, i.e. the average closing price of the quotes of the 30 days preceding the issue date.
As at 1st February 2011 ATENOR GROUP issued a second tranche of 53,200 options on own shares intended for members of the Management and the staff. These options can be exercised during the periods from 10 March to 10 April 2015 and from 2 to 30 September 2015 at the unit price of € 33.40, i.e. the average closing price of the quotes of the 30 days preceding the issue date.
The financial information of 2010 has now been agreed and published in accordance with the IFRS standards as adopted in the European Union.
ATENOR GROUP s.a.'s statutory annual accounts show a corporate profit for the tax year of K€ 10,519.
Apart from the operations reflected in the consolidated accounts, the 2010 profits/losses are explained by the covering of the general and structural costs connected with the projects under development.
Your Board proposes you to approve the annual accounts as at 31 December 2010 and allocate the corporate financial year's profit of ATENOR GROUP s.a. as follows:
| K€ | 10,519 | |
|---|---|---|
| K€ | 44,069 | |
| K€ | 54,588 | |
| K€ | 170 | |
| K€ | 10,077 | |
| K€ | 44,341 | |
The Board of Directors will propose to the General Assembly of 22 April 2011 the payment, for the financial year 2010, of a dividend of 2.00 euro; i.e. a dividend net of withholding (25%) of 1.50 euro per share and a dividend net of withholding (15%) of 1.70 euro per share accompanied by a VVPR strip.
Subject to approval by the General Assembly, the dividend will be paid as of 29 April 2011.
| - Ex date | 26 April 2011 |
|---|---|
| - Record date | 28 April 2011 |
| - Payment date | 29 April 2011 |
ATENOR has implemented the legal provisions of the law of 6 April 2010 and the recommendations of the Corporate Governance Code of 2009 concerning internal control and risk management. In this context, ATENOR has adapted its own guidelines for internal control and risk management on the basis of the general principles described in the guidelines written up by the Corporate Governance Commission.
In compliance with the legal provisions, the principal characteristics of the internal control and risk management systems within the framework of the process of establishment of the financial information can be described as follows:
The Accounting and Financial Department is organised under the responsibility of the CFO, in such a way that it has, with a sufficient degree of security, the necessary resources and access to the financial information necessary to draw up the financial statements.
A manual of accounting principles and procedures has been written up; it rather broadly covers the different points falling under the accounting and financial organisation and procedures, among them in particular the accounting principles of the most important operations.
The company has defined objectives and responsibilities for the preparation of the financial information. These objectives are expressed primarily in terms of quality, compliance with companies law and accounting law, and in terms of time periods.
For these principal identified risks, the company, through people with the appropriate skills, provides for double verification of the process in such a way as to sharply reduce the probability of the occurrence of the risk.
The adoption of or the changes in accounting principles are taken into account as soon as their obligating event occurs. There is a process that makes it possible to identify the obligating event (decision, change of legislation, change of activity, etc.). These changes are the object of approval by the management body.
The risks in the process of preparing the financial information are handled in particular through regular communication of the CFO with the different people in charge, a process of generalised double verification, by a programme of tests and verifications carried out by the internal audit, under the responsibility of the Audit Committee, or by specific actions on the part of the Audit Committee or the Board of Directors.
The monitoring of the risk management procedures in the preparation of the financial information is therefore exercised continuously and matched by the Board the Directors and its Audit Committee, by the CEO and the CFO, and by the internal audit.
The daily accounting operations, the monthly payments, the quarterly, half-year and annual closings and reporting at group level are all procedures that make it possible to ensure that the manual of accounting principles and procedures is correctly applied. In addition the internal audit programme, approved by the Audit Committee, provides regular verification through targeted tests of the risk areas identified by the Audit Committee.
Regular weekly inspections are organised by the Executive Committee, under the chairmanship of the CEO, to check the key processes leading to the preparation of the accounting and financial information.
The procedures for preparing the group's financial statements are applicable in all the components of the perimeter of consolidation, without exception
Procedures and information systems have been put in place to satisfy the requirements of reliability, availability and relevance of the accounting and financial information.
Detailed reporting, quarterly at a minimum, makes it possible to relate back the relevant and important accounting and financial information at the level of the Audit Committee and the Board of Directors.
There are managers, procedures and a schedule of regulatory obligations for the purposes of identifying and complying within time limits periodic obligations and other market information.
The information systems relating to the accounting and financial information are the object of adaptations in order to progress with the company's needs.
Performance and quality indicators have been defined and are the object of periodic review. Taking into consideration the procedures in place and their monitoring, the information system is judged to be sufficiently secured.
The group has set up measures making it possible to ensure that the accounting principles selected that have a significant impact on the presentation of the financial statements correspond to the activity and to the environment of the company and have been formally validated by the Audit Committee and approved by the Board of Directors. The internal quarterly reporting prepared by all the members of the Executive Committee, covering all aspects of the group and of its risks, the revision of this reporting by the CEO and the CFO working cooperatively, the examination of this reporting by the Audit Committee before presentation and discussion in the Board of Directors, constitute the cornerstone of the steering measure of the system for controlling the financial information.
The preparation and presentation of the financial statements, including the balance sheet, the profit and loss accounts, the annexes and the financial situation, are therefore explained to the Board of Directors at each published closing of financial statements.
The financial information published periodically is reviewed in advance and analysed by the Audit Committee before being approved by the Board of Directors.
ATENOR GROUP has holdings in companies performing real estate projects and is also directly involved in real estate promotions.
ATENOR GROUP is faced with the risks and uncertainties inherent in this activity and, in particular, the changes in international economic trends and the markets in which the buildings are constructed, and the changes in the bases of the financial markets, such as interest rates and the volume of funds intended for investment.
The Board of Directors is attentive to the analysis and management of the various risks and uncertainties to which ATENOR GROUP and its subsidiaries are subject. Furthermore, the Board of Directors sets out three identified risks which ATENOR GROUP faces:
• In the context of the tax dispute involving what are known as "Liquidity Companies", which could concern more than 700 companies in Belgium,
ATENOR GROUP is of the opinion that the claims the Group is facing are unfounded and, consequently, no provision has been made for dealing with these disputes.
La Hulpe, 25 February 2011 For the Board of Directors.
| In thousands of EUR | Notes | 2010 | 2009 |
|---|---|---|---|
| Revenue | 2 & 3 | 10,944 | 35,490 |
| Turnover | 10,743 | 34,687 | |
| Property rental income | 201 | 802 | |
| Other operating income | 2 & 3 | 15,291 | 14,208 |
| Gain (loss) on disposals of financial assets | 14,137 | 12,304 | |
| Other operating income | 1,154 | 1,904 | |
| Gain (loss) on disposals of non-financial assets | |||
| Operating expenses (-) | 2 & 3 | -22,755 | -37,142 |
| Raw materials and consumables used (-) | -15,470 | -18,534 | |
| Changes in inventories of finished goods and work in progress | 24,278 | 22,613 | |
| Employee expenses (-) | 4 | -5,863 | -6,037 |
| Depreciation and amortization (-) | -773 | -933 | |
| Impairments (-) | -451 | -322 | |
| Other operating expenses (-) | 5 | -24,476 | -33,929 |
| Result from operating activities - EBIT | 2 & 3 | 3,480 | 12,556 |
| Financial expenses (-) | 6 | -5,925 | -2,706 |
| Financial income | 6 | 1,480 | 995 |
| Share of profit (loss) from investments consolidated by the equity method | -440 | 105 | |
| Profit (loss) before tax | -1,405 | 10,950 | |
| Income tax expense (income) (-) | 7 | -280 | -3,747 |
| Profit (loss) after tax | -1,685 | 7,203 | |
| Post-tax profit (loss) of discontinued operations | |||
| Profit (loss) of the period | -1,685 | 7,203 | |
| Attributable to minority interest | -86 | -113 | |
| Group profit (loss) | -1,599 | 7,316 | |
| In EUR | |||
| Earnings per share | |||
| Number of shares | 9 5,038,411 | 5,038,411 | |
| Basic earnings | 8 | -0.32 | 1.45 |
| Diluted earnings per share | 8 | -0.32 | 1.45 |
| Proposal of gross dividend per share | 8 | 2.00 | 2.60 |
| In thousands of EUR | |
|---|---|
| --------------------- | -- |
| Group share result | -1,599 | 7,316 |
|---|---|---|
| Translation adjusments | -1,533 | -1,763 |
| Cash flow hedge | 114 | -9 |
| Overall total results of the group | -3,018 | 5,544 |
| Overall profits and losses of the period attributable to third parties | -86 | -113 |
| Total assets | 270,141 | 239,583 |
|---|---|---|
| In thousands of EUR | Notes | 2010 | 2009 | In thousands of EUR | Notes | 2010 | 2009 |
|---|---|---|---|---|---|---|---|
| Non-current assets | 63,535 | 61,317 | Total equity | 100,531 | 117,162 | ||
| Property, plant and equipment | 11 | 20,764 | 21,302 | Group shareholders' equity | 101,092 | 117,807 | |
| Investment property | 12 | 1,648 | 1,656 | Issued capital | 38,880 | 38,880 | |
| Intangible assets | 10 | 6,699 | 5,768 | Reserves | 68,483 | 84,043 | |
| of which goodwill | 6,641 | 5,709 | Treasury shares (-) | 9 | -6,271 | -5,115 | |
| Investments in related parties | 16 | 1 | 255 | Minority interest | -561 | -646 | |
| Investments consolidated by the equity method |
13 | 9,120 | 14,662 | Non-current liabilities | 114,057 | 46,508 | |
| Deferred tax assets | 18 | 10,502 | 10,502 | Non-current interest bearing borrowings | 21 | 99,671 | 31,036 |
| Other non-current financial assets | 16 | 14,718 | 7,089 | Non-current provisions | 19 | 470 | |
| Derivatives | Pension obligation | 22 | 142 | 193 | |||
| Other non-current assets | 17 | 83 | 83 | Derivatives | 21 | 1,289 | 2,000 |
| Deferred tax liabilities | 18 | 12,955 | 12,809 | ||||
| Current assets | 206,606 | 178,265 | Current liabilities | 55,553 | 75,913 | ||
| Inventories | 15 | 119,351 | 95,590 | Current interest bearing debts | 21 | 22,836 | 56,114 |
| Other current financial assets | 16 | 72,839 | 13,122 | Current provisions | 19 | 2,496 | 1,972 |
| Derivatives | 16 | 63 | Pension obligation | 22 | 49 | 144 | |
| Current tax receivables | 17 | 1,250 | 1,881 | Derivatives | 21 | 133 | |
| Current trade and other receivables | 17 | 6,121 | 54,341 | Current tax payables | 21 | 3,522 | 3,538 |
| Current loans payments | 47 | Current trade and other payables | 21 | 21,759 | 13,706 | ||
| Cash and cash equivalents | 17 | 2,675 | 2,461 | Other current liabilities | 21 | 4,758 | 438 |
| Other current assets | 17 | 4,370 | 10,759 | ||||
| Total equity and liabilities | 270,141 | 239,583 |
| In thousands of EUR | Notes | 2010 | 2009 | In thousands of EUR | Notes | 2010 | 2009 |
|---|---|---|---|---|---|---|---|
| Non-current assets | 63,535 | 61,317 | Total equity | 100,531 | 117,162 | ||
| Property, plant and equipment | 11 | 20,764 | 21,302 | Group shareholders' equity | 101,092 | 117,807 | |
| Investment property | 12 | 1,648 | 1,656 | Issued capital | 38,880 | 38,880 | |
| Intangible assets | 10 | 6,699 | 5,768 | Reserves | 68,483 | 84,043 | |
| of which goodwill | 6,641 | 5,709 | Treasury shares (-) | 9 | -6,271 | -5,115 | |
| Investments in related parties | 16 | 1 | 255 | Minority interest | -561 | -646 | |
| Investments consolidated by the equity method |
13 | 9,120 | 14,662 | Non-current liabilities | 114,057 | 46,508 | |
| Deferred tax assets | 18 | 10,502 | 10,502 | Non-current interest bearing borrowings | 21 | 99,671 | 31,036 |
| Other non-current financial assets | 16 | 14,718 | 7,089 | Non-current provisions | 19 | 470 | |
| Derivatives | Pension obligation | 22 | 142 | 193 | |||
| Other non-current assets | 17 | 83 | 83 | Derivatives | 21 | 1,289 | 2,000 |
| Deferred tax liabilities | 18 | 12,955 | 12,809 | ||||
| Current assets | 206,606 | 178,265 | Current liabilities | 55,553 | 75,913 | ||
| Inventories | 15 | 119,351 | 95,590 | Current interest bearing debts | 21 | 22,836 | 56,114 |
| Other current financial assets | 16 | 72,839 | 13,122 | Current provisions | 19 | 2,496 | 1,972 |
| Derivatives | 16 | 63 | Pension obligation | 22 | 49 | 144 | |
| Current tax receivables | 17 | 1,250 | 1,881 | Derivatives | 21 | 133 | |
| Current trade and other receivables | 17 | 6,121 | 54,341 | Current tax payables | 21 | 3,522 | 3,538 |
| Current loans payments | 47 | Current trade and other payables | 21 | 21,759 | 13,706 | ||
| Cash and cash equivalents | 17 | 2,675 | 2,461 | Other current liabilities | 21 | 4,758 | 438 |
| Other current assets | 17 | 4,370 | 10,759 | ||||
| Total equity and liabilities | 270,141 | 239,583 |
| Acquisitions of intangible and tangible assets | -226 | -53 |
|---|---|---|
| Acquisitions of financial investments | -1,051 | -13,379 |
| New loans | -8,665 | -268 |
| Subtotal of acquired investments | -9,942 | -13,700 |
| Disposal of intangible and tangible assets | 2 | |
| Disposal of financial investments | 58,589 | |
| Reimbursement of loans | 1,036 | 6,836 |
| Subtotal of disinvestments | 59,627 | 6,836 |
| Cash from investment activities (±) | 49,685 | -6,864 |
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Financial activities | ||
| Capital increase | 0 | 0 |
| Own shares | -1,102 | |
| New long-term loans | 79,250 | 22,162 |
| Reimbursement of long-term loans | -10,615 | |
| Dividends paid by parent company to its shareholders | -13,318 | -12,821 |
| Fees paid to the directors | -170 | -150 |
| Cash from financial activities (±) | 54,045 | 9,191 |
| Changes in scope of consolidation and exchange rate | -374 | 20 |
| Net cash variation | 59,931 | -23,175 |
| Opening value of cash accounts in balance sheet | 15,583 | 38,757 |
|---|---|---|
| Closing value of cash accounts in balance sheet | 75,514 | 15,583 |
The sales of financial fixed assets (+ 58.59 million euro) realised in 2010 influenced the investments activities by the following operations:
The "new loans granted" (+ 8.67 million euro) were granted primarily to the subsidiaries consolidated by the equity method, SOUTH CITY HOTEL and IMMOANGE (VICTOR project).
The "Variation of long-term loans" is primarily influenced by the bond issue carried out on 18 January 2010 for an amount of 75 million euro and for a duration of five years (maturity as at 18 January 2015).
Long-term bank financing (6 million euro) was reimbursed during the second half of 2010.
Background: the cash flows in 2009 were significantly impacted by
| In thousands of EUR | Notes | Issued capital |
Hedging reserves |
Own shares |
Consolidated reserves |
Profit/ loss of the period |
Cumulative translation adjustments |
Minority | interests Total Equity |
|---|---|---|---|---|---|---|---|---|---|
| 2009 | |||||||||
| Balance as of 01.01.2009 | 38,879 | -429 | -4,114 | 94,545 | - | -3,004 | -430 | 125,449 | |
| Profit/loss of the period | - | - | - | - | 7,316 | - | -113 | 7,203 | |
| Other elements of the overall results | (2) | - | -9 | - | - | - | -1,763 | - | -1,772 |
| Total comprehensive income | - | -9 | - | - | 7,316 | -1,763 | -113 | 5,431 | |
| Paid dividends and directors' entitlements | - | - | - | -12,976 | - | - | - | -12,976 | |
| Own shares | (1) | - | - | -1,002 | - | - | - | - | -1,002 |
| Share based payment | - | - | - | 363 | - | - | - | 363 | |
| Others | - | - | - | - | - | - | -103 | -103 | |
| Balance as of 31.12.2009 | 38,879 | -438 | -5,115 | 81,932 | 7,316 | -4,767 | -646 | 117,162 | |
| 2010 | |||||||||
| Balance as of 01.01.2010 | 38,879 | -438 | -5,115 | 89,248 | - | -4,767 | -646 | 117,162 | |
| Profit/loss of the period | - | - | - | - | -1,599 | - | -86 | -1,685 | |
| Other elements of the overall results | (2) | - | 114 | - | - | - | -1,533 | - | -1,419 |
| Total comprehensive income | - | 114 | - | - | -1,599 | -1,533 | -86 | -3,104 | |
| Paid dividends and directors' entitlements | - | - | - | -12,940 | - | - | - | -12,940 | |
| Own shares | (1) | - | - | -1,156 | - | - | - | - | -1,156 |
| Share based payment | - | - | - | 399 | - | - | - | 399 | |
| Others | - | - | - | - | - | - | 170 | 170 | |
| Balance as of 31.12.2010 | 38,879 | -324 | -6,271 | 76,707 | -1,599 | -6,300 | -562 | 100,531 |
(1) The own shares acquired since 2008 will serve to cover an option plan concerning a total of 300,000 existing shares (Annual Stock option plans issued from 2007 to 2010). See note 9 (Capital) and note 22 (Employee benefits).
(2) In 2008, the group acquired Hungarian and Romanian companies. It has also had a subsidiary in the Czech Republic for many years. ATENOR opted for the use of the local currency as the functional currency in each of these countries. The positive (Czech Republic) and negative (Romania) conversion differences noted in the shareholders' equity were impacted by the changes in these currencies, resulting in a negative impact. See note 16 (Financial assets) and note 23 (Risk management). Background: the capital consists of 5,038,411 ordinary shares without designation of nominal value.
The consolidated financial statements on 31 December 2010 were prepared in compliance with the IFRS (International Financial Reporting Standards) pronouncements as adopted in the European Union.
All the standards in effect by the IASB on the date of closing were applied; no standard was applied in advance.
The following new interpretations and amendments have been applied, as need be, starting with the 2010 financial year:
These new amended interpretation did not have any impact on the consolidated financial results of ATENOR GROUP.
In addition, ATENOR GROUP did not apply the new and amended standards and interpretation that enter into force after 31 December 2010 in advance, that is:
IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments (applicable for annual periods beginning on or after 1 July 2010).
Amendment to IFRIC 14 IAS 19 – The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction – Prepayments of a Minimum Funding Requirement (applicable for annual periods beginning on or after 1 January 2011).
The future application of these new standards and interpretations will not have a significant impact on the consolidated financial statements of ATENOR GROUP in the current state of the analyses performed.
The consolidated financial statements of the Group were made up by the Board of Directors on 25 February 2011.
The consolidated financial statements include the financial statements of ATENOR GROUP s.a. and its subsidiaries that are controlled directly or indirectly. These subsidiaries are consolidated according to the full consolidation method. Control is assumed to exist if the Group holds at least 50% of the shares.
The equity method is applied especially in the case of joint ventures held with joint control.
The intra-group transactions and results have been eliminated.
These consolidated financial statements have been prepared on the basis of historical cost, with the exception of certain financial instruments that are entered in the accounts according to the convention of fair value in conformity with the handling of the different categories of financial assets and liabilities defined by the IAS 39 standard.
The financial statements are presented in thousands of euro and rounded off to the nearest thousand.
A tangible fixed asset is booked in the accounts if it is probable that the future economic advantages associated with this element will be released by the Group and if the cost of this asset can be evaluated in a reliable way.
The tangible fixed assets are subject to the application of the terms relating to the depreciation of assets (IAS 36) and to the duration of the utility of the significant components of the shares (IAS 16).
The grounds, installations and machines held with a view to their use in the production of goods and services, or for administrative purposes, are initially assessed at their acquisition value with the deduction of accumulated amortisation and any losses of value that may be recognised.
The acquisition value includes all the directly imputable charges necessary to bring the asset into a state where it can fulfil the function for which it is intended. The depreciation is calculated based on the estimated duration of service life, with a deduction of the residual value if this is significant. The borrowing costs are assets if applicable in tangible fixed assets under the conditions stipulated by IAS 23. The depreciations are calculated linearly on the estimated duration of service life of the assets as from the date on which the asset is ready to be used, taking into account the residual value of the assets concerned, if this is significant. Depreciation is booked in the income statement under the category "Depreciation and amortisation (-)".
| Structures: | 20 - 33 years |
|---|---|
| Installations and equipment: | 10 - 15 years |
| Machines: | 3 - 8 years |
| Computer materials: | 3 - 10 years |
| Furniture: | 2 - 10 years |
| Mobile equipment: | 4 years |
| Outfitting of rented property: | 9 years (duration of the lease) |
The assets under financial leasing are amortised over the economic service life or, if it is shorter, over the duration of the lease.
The assets held in this entry represent the properties held to gain rental income or properties let in the expectation of the implementation of a real estate project in the medium term. Investment properties are booked at their acquisition value, reduced by depreciations and any losses in value. The market value is mentioned for information purposes in a note in the consolidated financial statements.
ATENOR GROUP has opted for valuation of buildings held temporarily as investments according to the "cost model", a model that is more appropriate than the "fair value model" from the point of view of later appreciation through an own real estate development
The depreciations are calculated linearly over the estimated service life of the buildings, with deduction of their probable residual value. The depreciation is booked into the income statement under the category "Depreciation and amortisation (-)". As a general rule, investment buildings for which the operating horizon is not limited are depreciated over 33 years.
The profit or the loss resulting from the transfer or the change of purpose of a tangible fixed asset corresponds to the difference between the income from the sale and the accounting value of the tangible fixed asset. This difference is taken into account in the income statement. The grounds are assumed to have an unlimited service life and are not depreciated. Later expenditures are booked into the income statement at the moment when they are incurred. Such an expense is activated only when it can be clearly In compliance with IFRS 3 on the regrouping of companies and IAS 38 on intangible fixed assets, the duration of utility of the goodwill acquired within the scope of a regrouping of companies is considered as indeterminate and no depreciation is booked in the accounts. Each year ATENOR GROUP carries out a depreciation test consisting of allocating a recoverable value to each generating unit of the Group's accounts. If this recoverable value is lower than the accounting value of the unit or the entity concerned, the Group registers a loss in value, for which the difference
demonstrated that it has led to an increase in the future economic advantages expected from the use of the tangible fixed asset in comparison with its normal performance as initially estimated. is booked in the profit and loss accounts. The loss of value recognised for goodwill cannot be recovered during later financial years.
The intangible fixed assets, other than goodwill, are evaluated initially at cost. The intangible fixed assets are booked into the accounts if it is probable that the future economic advantages that can be attributed to the asset will go to the undertaking and if the cost of this asset can be evaluated in a reliable way. After initially being entered in the accounts, the intangible fixed assets are evaluated at cost reduced by the combination of the amortisations and the combination of the depreciations and cumulated loss of value of assets.
The intangible assets other than goodwill primarily include the software programs.
The intangible fixed assets are depreciated according to the linear method on the basis of the best estimation of their duration of utility. The depreciation is booked in the accounts in the income statement under the category "Depreciation and amortisation (-)".
The goodwill constitutes the difference between the acquisition cost determined at the time of the regrouping of companies and the Group share in the fair value of the assets, liabilities and any identifiable benefits.
Except for the current intangible assets, which are subjected to an annual impairment test, tangible and intangible fixed assets are the object of an impairment test only when there is an indication showing that their accounting value will not be recoverable by their use or their sale.
The Group enters a non-current asset (or any entity intended to be disposed of) as held for sale if the accounting value is or will be recovered primarily through a sales transaction rather than through continued use.
The non-current assets held for sale are valued at the lowest at their accounting value or at their fair value reduced by the costs of sale.
A discontinued activity is a unit (or a group of units) generating funds that either has been disposed of or is held for sale. It appears in the profit and loss accounts under a single amount and its assets and liabilities are presented in the balance sheets separately from the other assets and liabilities.
ATENOR GROUP's activities in the real estate field lead the group to hold various types of buildings categorised by the use to which they are assigned:
Each category has its own corresponding accounting principles regarding the recognition of the assets at origin and their later valuation.
The inventories are valued at the lowest at cost and the net marketable value. The costs of acquisition and transformation include among other things the value of the inventories.
The buildings, grounds and construction that are the object of a real estate project are also booked in the inventories in this way constituting a single category of assets intended for realisation. They are valued at their cost price including the direct and indirect charges imputable to the estimated period of construction, including if applicable the borrowing costs (IAS 23).
A provision is constituted when the Group has a legal or implicit obligation at the date of the balance sheet and at the latest during the approval of the consolidated financial statements by the Board of Directors. The registered provisions meet the three-fold condition of resulting from a past transaction or event, of having a probability of leading to an outflow of resources and of being able to estimate the outflow of resources in a reliable way.
The provisions are the object of discounting in order to take into account the course of time. Each year ATENOR GROUP reviews the discounting rates used for each of its provisions.
In the application of the evaluation rules, the establishment of provisions for charges to be paid constitutes an area of critical judgement.
The provisions for restructuring are booked in the accounts when the Group has adopted a formalised and detailed plan for restructuring that was the subject of a public announcement to the parties affected by the restructuring before the date of closing.
Insofar as risks and undertakings are concerned for which an actual disbursement is disputed and judged not very probable, ATENOR GROUP will provide qualitative indications in note 23.
The costs of borrowing directly attributable to the acquisition, construction or production of a qualified asset are incorporated into the cost of this asset.
A qualified asset is an asset requiring a long period of preparation before it can be used or sold. The buildings intended for sale incorporated into the inventory account meet this criterion because the studies, the construction and the sales and marketing process can take several years.
The rate used to determine these costs will correspond to the weighted average borrowing costs applicable to the loans contracted specifically in order to obtain the related asset.
ATENOR GROUP will start the capitalisation of the costs of borrowing as soon as the permits that are indispensable to the preparation of the asset have been issued and the implementation of the construction site is actually launched.
Capitalisation of the costs of borrowing is suspended during the long periods in the course of which the normal development of the project is interrupted.
The Group has foreign assets and considers the currency of each country the "functional" currency in terms of IAS 21. This and EC regulation 1126/2008 of 15.10.2008 handle the "effects of changes in foreign exchange rates" and define the way to convert the financial statements into euro (reporting currency).
It is of course understood that an abandoned project whose net market value is lower than the net book value in stock would be the object of an appropriate value correction.
The Group therefore enters transactions and balances in the currency and due to this fact it is exposed to exchange risks of these currencies, defined as functional, materialising through conversion differences incorporated into its own consolidated equity capital. The share of income attributable to construction shall appear in the result in accordance with the progress report of works as the risks and benefits are transferred to the buyer.
All the projects under development in these foreign countries remain valued in stock according to the acquisition prices and the market prices relating to the studies and to the construction costs. All the active steps contributing to the successful completion of the project express the value creation provided by ATENOR GROUP and support the maintenance of an asset value "at cost" as long as the project demonstrates its feasibility and its profitability, whatever the unanticipated unknowns in the market values. These accounting principles are implemented in the light of the principles and guidance provided by IFRIC 15 - Agreements for the construction of real estate, or by analogy to IAS 11 (Construction contracts) or IAS 18 (Services contracts) insofar as the recognition of revenues on progress taking into account the specific features of the activity of a real estate project developer is concerned, or in application of the principles of IAS 18 applicable to the delivery of goods with recognition of the revenue at the time of the actual transfer of the risks and advantages of ownership of the properties to the buyer.
definitively acquired with deduction of all reasonably foreseeable charges associated with the obligations assumed by ATENOR GROUP in respect of the acquirer, in particular as regards the construction and the letting of the building.
The use of the local currency as the functional currency is justified by the operational needs for execution of the projects. The company's taxes are based on the profit and loss for the year and include the taxes for the year and the deferred taxes. They are taken up in the profit and loss account, except if they concern elements directly taken up in the equity funds, in which case they are entered directly in the equity funds.
The regular updating of the feasibilities (cost price, rental price, transfer parameters) of the projects makes it possible to check the extent to which the potential margin is affected by the evolution of economic and financial conditions. Consequently this estimated result per project incorporates the exchange risk as a parameter of the feasibility of each of the projects. The tax for the financial year is the amount of tax to be paid based on the taxable profit for the financial year, as well as any corrections concerning previous years. It is calculated based on the local tax rate that is applicable (or applied to a large extent) at the date of closing.
If necessary, in application of the above-mentioned principles, the share of income from a real estate transaction related to the land is immediately acknowledged in the results from the moment that the transfer to the purchaser of control and/or the risks and advantages associated with the land is substantially realised and an identifiable part of the income can be attributed to it.
The land share is evaluated in accordance with the parameters of the market and the contract.
2.11 Segment reporting The segment reporting is based, both for internal and external communication, on a single activity criterion, namely, project development in the area of real estate promotion. The deferred taxes are recognised in the differences between the net accounting value of the assets and liabilities in the financial statements and their corresponding fiscal value. Deferred tax liabilities are acknowledged on all taxable time differences whereas deferred tax assets are acknowledged to the extent that there are convincing indications that future taxable profits will be available to use these deferred tax assets.
ATENOR GROUP exercises its main activity of developing real estate promotion projects essentially in the area of office and residential buildings with relatively homogeneous characteristics and similar viability and risk profiles. At each closure date, ATENOR GROUP reestimates the deferred tax assets that have or have not been booked, on the basis of indications of the future viability of the companies concerned.
ATENOR GROUP has no organised activity by geographic markets. The internal and external reporting of ATENOR GROUP does not refer to a geographical segmentation either. The book value of the deferred tax assets is reduced or limited to the extent where it is no longer probable that sufficient taxable profits will be available in the future to make it possible to cover all or part of these assets.
ATENOR GROUP forms part of complex real estate transactions in which the results are acknowledged as a function of contractual undertakings on the one hand and the extent of completion on the other hand. The principles of income recognition are applicable both in qualified "share deal" and "asset deal" operations for sales of buildings constructed or to be completed in the future. Income is recognised to the extent that it can be considered contractually as At the time of the original recognition of an asset (an acquisition) which is burdened with a taxable temporary difference, a deferred tax is entered in the accounts if this taxable difference arises either at the time of a regrouping of companies (business combination) or at the time of a transaction which gives rise to the establishment of a profit or a loss. The standard (IAS 12) prohibits recognising a deferred tax in other cases, in particular at the time of an acquisition of assets that do not constitute a "business" (above 2.4).
The deferred taxes are calculated at the tax rates in force.
Benefits after employment include pensions and other benefits connected with retirement, as well as life insurance and medical care after employment. The benefits are taken up either in the plans at fixed contributions, or in the pension plans at fixed benefits.
The contributions of the plans at fixed contributions are covered in the profit and loss account at the time when they are due. For the pension plans at fixed benefits, the amount booked in the accounts at the date of the balance sheet is determined as being the updated value of the obligation concerning the fixed benefits, according to the projected unit credit method.
The pension obligations recognised in the balance sheet represent the current value of the fixed benefits, corrected with the actuarial earnings and losses, less the cost of past services not recognised and less the real value of the assets of the plan.
Actuarial earnings and losses that exceed ten per cent of the highest updated value between the obligation of the Group concerning fixed benefits and the real value of the assets of the plan, are taken up in losses and profits on the duration of the average remaining life expectancy of the employees participating in the plan.
The Group has issued several plans for remuneration connected with the company's shares, and for which the payment is made in the form of the company's shares. In compliance with the transition terms, the standard IFRS 2 was not applied to allocations before 7 November 2002.
In general, for payments in shares to which IFRS 2 is applicable, the fair value of benefits of employees received in exchange for the allocation of options is recognised as a charge. The total amount to be attributed in charges linearly over the period of acquisition of rights is determined in reference to the fair value of the options allocated.
The fair value of the options is measured at the date of allocation, taking into account the market parameters as well as hypotheses concerning the number of options that should be exercised. Each year, on the date the balance sheet closes, the Group will review its estimations as to the number of options that should be exercised. The impact of the revision of the initial estimations is booked in the income statement and the equity is corrected as a consequence over the remaining acquisition period of the rights. The income, net of directly attributable transaction costs, is attributed in addition to the registered capital and to the issuing bonus when the options are exercised. The simple extension of the period for the exercise of options without change in the duration of acquisition of the rights does not modify the initial booking of the plan in the accounts.
The other payments made to the staff and based on the shares, in particular the transfer of own shares with a discount, are also registered in the equity accounts in application of IFRS 2 and booked as costs over the vesting period.
To value the assets and liabilities that appear in the consolidated financial statements, the Group must necessarily make certain estimates and use its judgement in certain areas. The estimates and hypotheses used are determined on the basis of the best information available at the time of the closure of the financial statements. Nevertheless, by definition the estimates rarely correspond to actual fulfilments, so that the accounting valuations that result inevitably contain a certain degree of uncertainty. The estimates and hypotheses that could have a significant impact on the valuation of the assets and liabilities are commented on below.
| In thousands of EUR | 2010 | 2009 | In thousands of EUR | Notes | 2010 | 2009 |
|---|---|---|---|---|---|---|
| Revenue | 10,944 | 35,490 | EBITDA | (1) | 4,704 | 13,811 |
| Other operating income | 15,291 | 14,208 | Current cash flow | (2) | -545 | 7,318 |
| Purchases and changes in inventories | 8,808 | 4,080 | Assets | 270,141 | 239,583 | |
| Employee expenses | -5,863 | -6,037 | of which investments consolidated by the | |||
| Depreciation and impairments | -1,224 | -1,255 | equity method | 9,120 | 14,662 | |
| Other operating expenses | -24,476 | -33,929 | Liabilities | 169,610 | 122,421 | |
| Result from operating activities EBIT |
3,480 | 12,556 | (1) EBIT + depreciation and impairments | |||
| Net interests | -4,445 | -1,710 | (2) Net result + depreciation, provision and amortisation + impairments on discontinued | |||
| Result of investments consolidated by the equity method |
-440 | 105 | operations | |||
| Income taxes | -280 | -3,747 | ||||
| Profit (loss) after tax | -1,685 | 7,203 | ||||
| Discontinued operations | 0 | 0 | ||||
| Net result | -1,685 | 7,203 |
The activities of ATENOR GROUP form one single sector (Real Estate), within which the real estate development and promotion projects are not differentiated by nature or by geographic area. The primary segmentation (Real Estate) reflects the organisation of the Group's business and the internal reporting supplied by the Management to the Board of Directors and to the Audit Committee. There is no secondary segment. See Note 1 (Principal accounting methods – Paragraph 2.11).
The activity report of ATENOR GROUP supplies information on the acquisitions and transfers that have occurred during the financial year.
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Total of the revenue | 10,944 | 35,490 |
| of which turnover | 10,743 | 34,687 |
| of which investment property rental income | 201 | 802 |
| Total of the other operating income | 15,291 | 14,208 |
| of which gain (loss) on disposals of financial assets | 14,137 | 12,304 |
| of which other operating income | 1,154 | 1,904 |
| of which gain (loss) on disposals of non-financial assets |
0 | 0 |
| Total of the operating charges | -22,755 | -37,142 |
| Result of operating activities | 3,480 | 12,556 |
The 2010 turnover comes primarily from the turnover made by the activity of the Crowne Plaza Hotel (8.71 million euro) and the balance of sales made within the framework of the MEDIA GARDENS project (0.89 million euro).
The operating profit (loss) 2010 is established at 3.48 million euro and comes essentially from sales of the SOUTH CITY OFFICE FONSNY and SOUTH CITY OFFICE BROODTHAERS investments and from the profit released by the PRESIDENT project.
See Note 5 – Other operating expenses.
Background: the 2009 operating profit (loss) included primarily the revenues and operating expenses released by the sale of the MEDIA GARDENS project in I.D.M., by the hotel activity of BRUSSELS EUROPA, by the margin released in ATENOR Luxembourg concerning the PRESIDENT project, by the rents received (I.D.M., IDM A, LAZER IMMO and CITY VIEW TOWER), by the capital gain released within the framework of the sale of the PRESIDENT, by the capital gain released at time of the setting up of the partnership concerning the VICTOR project and by the penalties received within the framework of the PIXEL project.
| -4,529 | -4,724 |
|---|---|
| -926 | -938 |
| -408 | -375 |
| -5,863 | -6,037 |
| Total employment at the end of the accounting year | 101.7 | 108.0 |
|---|---|---|
| ---------------------------------------------------- | ------- | ------- |
The whole of the personnel costs decreased slightly by 3% through the application of a rigorous policy concerning personnel management. It will be recalled that in 2009 these costs dropped by 10% in comparison with the preceding financial year.
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Services and other goods | -21,530 | -33,974 |
| Provisions (increase/amounts written back) | 84 | 1,141 |
| Other operating charges | -3,019 | -1,093 |
| Loss (exchange costs) | -11 | -2 |
| Total | -24,476 | -33,929 |
The line "Services and other goods" is mainly due to fees and services connected with the real estate projects, which are capitalised in stock in the amount of 24.28 million euro via the account "Changes in inventories of finished goods and work in progress" (see the "Consolidated income statement").
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Interest expenses | -5,238 | -2,414 |
| Other financial expenses | -687 | -292 |
| Interest income | 1,434 | 804 |
| Other financial income | 46 | 192 |
| Total financial results | -4,445 | -1,710 |
In 2010, the net financial costs amounted to 4.45 million euro, compared with 1.71 million euro in 2009.
This financial result is explained primarily by the financial charges connected with the bond issue issued on 18 January 2010 for an amount of 75 million euro at a rate of 6%. The balance of the financial expenses relates to the financial costs connected with the works on the projects in the portfolio (MEDIA GARDENS, HERMES BUSINESS CAMPUS and Váci GREENS).
See also "Consolidated cash flow statement".
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Income tax expense/income - current | ||
|---|---|---|
| Current period tax expense | -33 | -3,419 |
| Adjustments to tax expense/income of prior periods | -10 | -192 |
| Total current tax expense, net | -43 | -3,610 |
| Income tax expense/income - deferred | ||
| Related to the current period | -237 | -137 |
| Related to the temporary differences | - | - |
| Reversal of deferred tax | - | - |
| Related to prior exercises (tax losses) | - | - |
| Total deferred tax expense | -237 | -137 |
| Total current and deferred tax expense | -280 | -3,747 |
| Profit before taxes -1,405 |
10,950 |
|---|---|
| Statutory tax rate 33.99% |
33.99% |
| Tax expense using statutory rate 478 |
-3,722 |
| Adjustments to | |
| - current tax of prior periods | - -201 |
| - non-taxable revenues 6,531 |
4,182 |
| - non-tax deductible expenses -245 |
-467 |
| - recognising deferred taxes on previously unrecognised tax losses 337 |
442 |
| - on registering of deferred taxes referring to prior exercises (tax losses) | - - |
| - deferred taxes | - - |
| - tax computed on other basis 314 |
135 |
| - losses for the year -7,588 |
-4,089 |
| - other increase/decrease in tax charge -107 |
-27 |
| Tax expense using effective rate -280 |
-3,747 |
| Profit before taxes -1,405 |
10,950 |
| Effective tax rate | n.a. n.a. |
In 2010, the consolidated accounts of ATENOR GROUP registered deferred taxes (235 thousand euro) calculated on the operating result of the hotel managed by BRUSSELS EUROPA.
Background: in 2009, the gross contribution of the sale of the MEDIA GARDENS (I.D.M.) project to the operating result of 2009 was subject to the companies tax. In 2009, the operating result of I.D.M. amounted to 10.30 million euro. After deduction of the tax burden (3.27 million euro), in 2009 I.D.M. contributed to the net result group share in the amount of 7.02 million euro.
| Gross dividend per share (in euros) | 2.00 |
|---|---|
| Amount of dividends distributed after the closing date (in thousands of euros) |
10,076.82 |
| Profit per share (in euros) | -0.32 |
| Basic earnings per share (in euros) | -0.32 |
| Number of shares profiting from the dividend | 5,038,411 |
The result per share is obtained by dividing the "Group share" result by the number of shares in circulation as at 31 December 2010 (5,038,411 shares).
The gross dividend proposed at the Annual General Meeting of 22 April 2011 will amount to 2.00 euro and will be paid on 29 April 2011. The withholding tax amounts to 25% for ordinary coupons. The shares accompanied by a VVPR strip will benefit from a withholding tax reduced to 15% insofar as the strip is presented (accompanied by the security) before 31.12.2013.
Background: the strips accompanying coupon no. 2 reached maturity as at 31.12.2010. The strips accompanying coupon no. 3 will reach maturity as at 31.12.2011.
| Dividends on ordinary shares declared and paid during the period: |
-13,318 | -12,821 |
|---|---|---|
It will be recalled that the final dividend for 2009 was 2.60 EUR (gross), for 2008: 2.60 EUR (gross), for 2007: 2.60 EUR (gross), for 2006: 1.30 EUR (gross) and for 2005: 1.03 EUR (gross).
| Attribution in | 2010 | 2009 | 2008 | |
|---|---|---|---|---|
| Exercise price | € 36.18 | € 37.83 | € 39.17 | € 42.35 |
| Number of options on 31.12.2010 | 46,800 | 50,600 | 51,100 | 47,800 |
| Exercise periods | 11 March to 11 April 2014 2 to 30 September 2014 |
11 March to 11 April 2013 2 to 30 September 2013 |
26 March to 20 April 2012 1 to 31 October 2012 26 March to 20 April 2013 1 to 31 October 2013 26 March to 20 April 2014 1 to 31 October 2014 26 March to 20 April 2015 1 to 31 October 2015 26 March to 20 April 2016 1 to 31 October 2016 26 March to 20 April 2017 1 to 31 October 2017 |
28 March to 22 April 2011 1 to 31 October 2011 28 March to 22 April 2012 1 to 31 October 2012 28 March to 22 April 2013 1 to 31 October 2013 28 March to 22 April 2014 1 to 31 October 2014 28 March to 22 April 2015 1 to 31 October 2015 28 March to 22 April 2016 1 to 31 October 2016 28 March to 22 April 2017 |
| Expiry dates | 30 September 2014 | 30 September 2013 | 31 October 2017 | 22 April 2017 |
| Attribution in | 2010 | 2009 | 2008 | 2007 |
|---|---|---|---|---|
| Exercise price | € 36.18 | € 37.83 | € 39.17 | € 42.35 |
| Number of options on 31.12.2010 | 46,800 | 50,600 | 51,100 | 47,800 |
| Exercise periods | 11 March to 11 April 2014 2 to 30 September 2014 |
11 March to 11 April 2013 2 to 30 September 2013 |
26 March to 20 April 2012 1 to 31 October 2012 26 March to 20 April 2013 1 to 31 October 2013 26 March to 20 April 2014 1 to 31 October 2014 26 March to 20 April 2015 1 to 31 October 2015 26 March to 20 April 2016 1 to 31 October 2016 26 March to 20 April 2017 1 to 31 October 2017 |
28 March to 22 April 2011 1 to 31 October 2011 28 March to 22 April 2012 1 to 31 October 2012 28 March to 22 April 2013 1 to 31 October 2013 28 March to 22 April 2014 1 to 31 October 2014 28 March to 22 April 2015 1 to 31 October 2015 28 March to 22 April 2016 1 to 31 October 2016 28 March to 22 April 2017 |
| Expiry dates | 30 September 2014 | 30 September 2013 | 31 October 2017 | 22 April 2017 |
On 31 December 2010, the amount of equity came to 100.53 million euro, and the balance sheet total amounts to 270.14 million euro. As an independent developer of real estate projects, ATENOR GROUP is not subject to any requirement concerning capital subject to taxation. ATENOR GROUP hopes to maintain a reasonable ratio between the invested capital that it has and the balance sheet total. The Management, among other things, sees to regularly informing the Board of Directors and the Audit Committee of the development of the balance sheet and its components in such a way as to intentionally limit the average consolidated indebtedness. The number of options of the SOP 2007, 2008, 2009 and 2010 are part of an option plan concerning a total of 300,000 existing shares. During the year 2010, ATENOR GROUP acquired 33,580 own shares. As at 31 December 2010, ATENOR GROUP held 154,452 own shares acquired at an average price of 40.60 euro for a total amount of 6.27 million euro. These shares are intended to cover the option plans for 2007, 2008, 2009 and 2010. See also Note 22 (Employee benefits).
ATENOR GROUP's policy aims at maintaining a healthy balance sheet structure.
We will give the comprehensive details of the "stock options" plans allocated.
In accordance with the decision taken by the Remuneration Committee of 17 December 2008 ratified by the Board of Directors on 3 March 2009, on 20 January 2009 ATENOR GROUP issued on 20 January 2009 a total of 50,600 options on its own shares to various members of the Management and Staff. The exercise price was set at 37.83 euro which corresponds to the average closing price of the quotes of the 30 days preceding the issue. These options are exercisable during the periods from 11 March to 11 April 2013 and from 2 October to 30 September 2013. The Board of Directors of 3 March 2009 approved a new Stock Option Plan for three years. Therefore as at 2 February 2010 ATENOR GROUP issued a first tranche of 50,000 options on own shares intended for members of the Management and the Staff. These options can be exercised during the periods from 11 March to 11 April 2014 and from 2 to 30 September 2014 at the unit price of € 36.18, i.e. the average closing price of the quotes of the 30 days preceding the issue date.
On 31 December 2010, the structure of shareholding is as follows:
| Number of shares |
Holdings % | of which shares forming part of the joined shareholding |
|
|---|---|---|---|
| TRIS n.v. (1) | 604,880 | 12.01 | 604,880 |
| SOFINIM n.v. (1) | 604,880 | 12.01 | 604,880 |
| Luxempart s.a. (1) | 523,500 | 10.39 | 505,000 |
| ALVA s.a. (1) | 504,880 | 10.02 | 504,880 |
| Stéphan Sonneville s.a. (1) (2) | 259,818 | 5.16 | 150,500 |
| Sub-total | 2,497,958 | 49.59 | 2,370,140 |
| Own shares | 154,452 | 3.06 | |
| Public | 2,386,001 | 47.35 | |
| Total | 5,038,411 | 100.00 |
(1) Signatories of the Shareholders' Agreement
(2) Managing Director, company controlled by Mr Stéphan Sonneville
In compliance with article 74 of the law of 1 April 2007, these shareholders have communicated to the company that they held as a joined holding, at the date of entry into effect of the aforementioned law, more than 30% of the securities with voting rights.
| Ordinary shares |
|
|---|---|
| Movements in number of shares | |
| Number of shares, beginning balance | 5,038,411 |
| Number of shares issued after the 2010 balance sheet date and profiting from 2010 dividend |
- |
| Number of shares, ending balance | 5,038,411 |
| - of which issued and fully paid | 5,038,411 |
| Number of shares issued after the balance sheet date and profiting from dividend |
- |
| Total of issued shares profiting from 2010 dividend | 5,038,411 |
| Amount | |
|---|---|
| (in thousands | Number of |
| of EUR) | own shares |
| On 31.12.2010 (average price: € 40.60 per share) |
6,271 | 154,452 |
|---|---|---|
| - sales | - | - |
| - acquisitions | 1,155 | 33,580 |
| Movements during the period: | ||
| On 01.01.2010 (average price: € 42.32 per share) | 5,116 | 120,872 |
| Movements in own shares | ||
| Total of options on shares | 196,300 |
|---|---|
| - stock options plan 2010 | 46,800 |
| - stock options plan 2009 | 50,600 |
| - stock options plan 2008 | 51,100 |
| - stock options plan 2007 | 47,800 |
| Number of own shares reserved in order to cover: |
In accordance with the decision taken by the Remuneration Committee of 13 December 2006 ratified by the Board of Directors on 31 May 2007, ATENOR GROUP, on 3 August 2007, issued a total of 49,300 options on its own shares to various members of the management and staff. The exercise price was set at 42.35 euro which corresponds to the average closing price of the quotes of the 30 days preceding the issue. These options are exercisable during the periods from 28 March 2011 to 22 April 2011, from 01 October 2011 to 31 October 2011 and from 26 March 2012 to 20 April 2012.
In accordance with the decision taken by the Remuneration Committee of 18 December 2007 ratified by the Board of Directors on 03 March 2008, ATENOR GROUP, on 5 May 2008, issued a total of 51,100 options on its own shares to various members of the management and staff. The exercise price was set at 39.17 euro which corresponds to the average closing price of the quotes of the 30 days preceding the issue. These options are exercisable during the periods from 26 March 2012 to 20 April 2012 and from 1 October 2012 to 31 October 2012.
The Board of Directors of 29 May 2009 decided, in conformity with the legislation in effect, to grant an extension of five years to the beneficiaries of the SOP 2007 and 2008, extending the period for exercising the rights (without extension of the period of acquisition of rights) respectively to 22 April 2017 and to 31 October 2017.
| 2010 | |||
|---|---|---|---|
| In thousands of EUR | Goodwill | Software | Total |
| Movements in intangible assets | |||
| Gross book value as at 01.01.2010 | 10,169 | 125 | 10,294 |
| Cumulated depreciations as at 01.01.2010 | -66 | -66 | |
| Cumulated losses of value as at 01.01.2010 | -4,460 | -4,460 | |
| Intangible assets, beginning balance | 5,709 | 59 | 5,768 |
| Investments | 1,030 | 25 | 1,055 |
| Retirements and disposals (-) | |||
| Depreciations (-) | -26 | -26 | |
| Impairment (loss) reversal recognised in income | |||
| Foreign currency exchange increase (decrease) | -98 | ||
| Other increase (decrease) | |||
| Intangible assets, ending balance | 6,641 | 58 | 6,797 |
| Gross book value as at 31.12.2010 | 11,101 | 138 | 11,239 |
| Cumulated depreciations as at 31.12.2010 | -80 | -80 | |
| Cumulated losses of value as at 31.12.2010 | -4,460 | -4,460 | |
| Intangible assets, ending balance | 6,641 | 58 | 6,699 |
In 2010, ATENOR GROUP paid the last remaining tranche of the price (1 million euro) stipulated within the framework of the UP-site project, on top of the additional price paid in 2009 (2.24 million euro).
Two projects are concerned by the amount taken up in goodwill value (6.64 million euro), that is, the UP-site project (3.24 million euro) and the Váci Greens project (3.40 million euro), both handled at the time, taking their characteristics into consideration, in a regrouping of companies approach (business combination).
For each project, the company has estimated the future updated cash flows that each of these two projects is likely to generate, based on the construction budgets, and assumptions as to the rent and the market return.
The updating of the net cash flows is based on a rate corresponding to the average weighted cost of the company's shareholders' equity.
All the assumptions for the calculations are periodically reviewed by the Management and submitted to the Audit Committee and the Board of Directors. Established on the basis of the best current knowledge of the Group, the "feasibility" studies lead ATENOR GROUP to estimate that the results expected from these two projects should contribute positively to the future results of the group. In conformity with IFRS standards, these impairment tests make it possible to validate the accounting value of the goodwill recorded.
| 2009 | |||
|---|---|---|---|
| In thousands of EUR | Goodwill | Software | Total |
| Movements in intangible assets | |||
| Gross book value as at 01.01.2009 | 7,866 | 222 | 8,088 |
| Cumulated depreciations as at 01.01.2009 | -138 | -138 | |
| Cumulated losses of value as at 01.01.2009 | -4,460 | -4,460 | |
| Intangible assets, beginning balance | 3,406 | 84 | 3,490 |
| Investments | 2,303 | 2 | 2,305 |
| Retirements and disposals (-) | |||
| Depreciations (-) | -27 | -27 | |
| Impairment (loss) reversal recognised in income | |||
| Foreign currency exchange increase (decrease) | |||
| Other increase (decrease) | |||
| Intangible assets, ending balance | 5,709 | 59 | 5,768 |
| Gross book value as at 31.12.2009 | 10,169 | 125 | 10,294 |
| Cumulated depreciations as at 31.12.2009 | -66 | -66 | |
| Cumulated losses of value as at 31.12.2009 | -4,460 | -4,460 | |
| Intangible assets, ending balance | 5,709 | 59 | 5,768 |
| In thousands of EUR | Construc tions in progress |
Land and buildings |
Plant and equipment |
Motor vehicles |
Fixtures and fittings |
Other property, plant and equipment |
Total |
|---|---|---|---|---|---|---|---|
| 2010 | |||||||
| Movements in property, plant and equipment | |||||||
| Gross book value as at 01.01.2010 | 35 | 43,846 | 2,792 | 246 | 2,737 | 447 | 50,103 |
| Cumulated depreciations as at 01.01.2010 | -22,658 | -2,735 | -194 | -2,587 | -127 | -28,301 | |
| Cumulated losses of value as at 01.01.2010 | -500 | -500 | |||||
| Property, plant and equipment, beginning balance | 35 | 20,688 | 57 | 52 | 150 | 320 | 21,302 |
| Acquisitions | 103 | 7 | 110 | ||||
| Acquisitions through business combinations | |||||||
| Disposals (-) | -1 | -1 | |||||
| Reclassifications (to) from other items | -35 | 35 | |||||
| Reclassifications from/to the "Inventories" | |||||||
| Disposals through business disposal (-) | |||||||
| Depreciation expense (-) | -437 | -31 | -34 | -88 | -57 | -647 | |
| Foreign currency exchange increase (decrease) | |||||||
| Adjustments | |||||||
| Adjustments written back | |||||||
| Other increase (decrease) | |||||||
| Property, plant and equipment, ending balance | 20,251 | 26 | 17 | 200 | 270 | 20,764 | |
| Gross book value as at 31.12.2010 | 43,846 | 2,716 | 210 | 2,789 | 454 | 50,015 | |
| Cumulated depreciations as at 31.12.2010 | -23,095 | -2,690 | -193 | -2,589 | -184 | -28,751 | |
| Cumulated losses of value as at 31.12.2010 | -500 | -500 | |||||
| Property, plant and equipment, ending balance | 20,251 | 26 | 17 | 200 | 270 | 20,764 |
The line "Property, plant and equipment" consists primarily of the land and the building of BRUSSELS EUROPA, currently operated as a hotel under the Crowne Plaza franchise and for which the 2010 depreciation amounted to 0.47 million euro.
| In thousands of EUR | Construc tions in progress |
Land and buildings |
Plant and equipment |
Motor vehicles |
Fixtures and fittings |
Other property, plant and equipment |
Total |
|---|---|---|---|---|---|---|---|
| 2009 | |||||||
| Movements in property, plant and equipment | |||||||
| Gross book value as at 01.01.2009 | 43,846 | 2,792 | 246 | 2,774 | 447 | 50,105 | |
| Cumulated depreciations as at 01.01.2009 | -22,146 | -2,672 | -132 | -2,569 | -77 | -27,596 | |
| Cumulated losses of value as at 01.01.2009 | -500 | -500 | |||||
| Property, plant and equipment, beginning balance | 21,200 | 120 | 114 | 205 | 370 | 22,009 | |
| Acquisitions | 35 | 16 | 51 | ||||
| Acquisitions through business combinations | |||||||
| Disposals (-) | |||||||
| Reclassifications (to) from other items | |||||||
| Reclassifications from/to the "Inventories" | |||||||
| Disposals through business disposal (-) | |||||||
| Depreciation expense (-) | -512 | -63 | -62 | -71 | -50 | -758 | |
| Foreign currency exchange increase (decrease) | |||||||
| Adjustments | |||||||
| Adjustments written back | |||||||
| Other increase (decrease) | |||||||
| Property, plant and equipment, ending balance | 35 | 20,688 | 57 | 52 | 150 | 320 | 21,302 |
| Gross book value as at 31.12.2009 | 35 | 43,846 | 2,792 | 246 | 2,790 | 447 | 50,156 |
| Cumulated depreciations as at 31.12.2009 | -22,658 | -2,735 | -194 | -2,640 | -127 | -28,354 | |
| Cumulated losses of value as at 31.12.2009 | -500 | -500 | |||||
| Property, plant and equipment, ending balance | 35 | 20,688 | 57 | 52 | 150 | 320 | 21,302 |
| 2010 | ||||||
|---|---|---|---|---|---|---|
| Measurement at cost | ||||||
| In thousands of EUR | Land | Other Investment property |
Total at cost | |||
| Movements in investment property | ||||||
| Gross book value as at 01.01.2010 | 407 | 2,476 | 2,883 | |||
| Cumulated depreciations as at 01.01.2010 | -1,227 | -1,227 | ||||
| Cumulated losses of value as at 01.01.2010 | ||||||
| Investment property, beginning balance | 407 | 1,249 | 1,656 | |||
| Additions | ||||||
| Later expenses | ||||||
| Disposals (-) | ||||||
| Losses/recoveries of value | ||||||
| Foreign currency exchange increase (decrease) | 23 | 70 | 93 | |||
| Transfers (to) from inventories/owner occupied property | ||||||
| Depreciation expense (-) | -101 | -101 | ||||
| Investment property, ending balance | 430 | 1,218 | 1,648 | |||
| Gross book value as at 31.12.2010 | 430 | 2,616 | 3,046 | |||
| Cumulated depreciations as at 31.12.2010 | -1,398 | -1,398 | ||||
| Cumulated losses of value as at 31.12.2010 | ||||||
| Investment property, ending balance | 430 | 1,218 | 1,648 | |||
| Other information | ||||||
| Fair value of appraised investment property | 1,750 |
As at 31 December 2010, this category exclusively concerned LAZER IMMO (real estate subsidiary in the Czech Republic).
Under the terms of the IMAG (company of Private Equity sold in 2007) sale agreement, the buyers had a purchase option on all LAZER IMMO shares. This option was not exercised and the group is studying the paths for valuation of this investment.
ATENOR GROUP turned to an independent expert to evaluate the value of the parcel held by LAZER IMMO. This expert report valued the property at around 1.70 million euro.
| 2009 | |||
|---|---|---|---|
| Measurement at cost | |||
| In thousands of EUR | Land | Other Investment property |
Total at cost |
| Movements in investment property | |||
| Gross book value as at 01.01.2009 | 1,778 | 3,756 | 5,534 |
| Cumulated depreciations as at 01.01.2009 | -2,377 | -2,377 | |
| Cumulated losses of value as at 01.01.2009 | |||
| Investment property, beginning balance | 1,778 | 1,379 | 3,157 |
| Additions | |||
| Later expenses | |||
| Disposals (-) | |||
| Losses/recoveries of value | |||
| Foreign currency exchange increase (decrease) | 5 | 21 | 26 |
| Transfers (to) from inventories/owner occupied property | -1,376 | -1,376 | |
| Depreciation expense (-) | -151 | -151 | |
| Investment property, ending balance | 407 | 1,249 | 1,656 |
| Gross book value as at 31.12.2009 | 407 | 2,476 | 2,883 |
| Cumulated depreciations as at 31.12.2009 | -1,227 | -1,227 | |
| Cumulated losses of value as at 31.12.2009 | |||
| Investment property, ending balance | 407 | 1,249 | 1,656 |
| Other information | |||
| Fair value of appraised investment property | 1,750 |
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Investments | ||
| At the end of the preceding period | 14,662 | -9 |
| Movements during the period | -5,542 | 14,671 |
| At the end of the period | 9,120 | 14,662 |
| Sums due to related parties |
Sums due to the group from related parties |
|
|---|---|---|
| IMMOANGE, share of the group: 50% | - | 11,198 |
| VICTOR PROPERTIES, share of the group: 50% | - | 574 |
| SOUTH CITY HOTEL, share of the group: 40% | - | 2,774 |
The investments consolidated by the equity method are the companies for which 50% at most is held, which are the object of joint control.
As at 31 December 2010, SOUTH CITY HOTEL (40%), IMMOANGE (50%) and VICTOR PROPERTIES (50%) are three companies consolidated by the equity method.
Background: ATENOR and CFE pooled their parcels (29 June 2009) in the company IMMOANGE by means of an exchange of shares.
During the 2010 financial year, the companies SOUTH CITY OFFICE FONSNY and SOUTH CITY OFFICE BROODTHAERS (both held 40%) were the object of a sale to institutional investors and due to this no longer appear in the item of companies consolidated by the equity method in 2010.
| In thousands of EUR | Balance | sheet total Inventories | Debts | Result at the end of the period |
|---|---|---|---|---|
| 2010 key figures from financial statements | ||||
| IMMOANGE, share of the group: 50% | 28,171 | 2,867 | 23,512 | -3,094 |
| VICTOR PROPERTIES, share of the group: 50% | 1,188 | - | 1,150 | -27 |
| SOUTH CITY HOTEL, share of the group: 40% | 17,924 | 16,893 | 19,065 | -494 |
The relations between ATENOR GROUP s.a. and its subsidiaries are detailed in Note 26 relating to the structure of the group. Please refer also to Note 13 concerning the investments consolidated by the equity method.
The remuneration received directly or indirectly by the Managing Director (management company) is defined overall for the role that he takes both on the Board of Directors and directly or indirectly in the Company and its subsidiaries. The total remuneration, both fixed and variable, of the Managing Director is decided by the Nomination and Remuneration Committee on the basis of principles validated by the Board.
This information can be broken down as follows:
The Company did not deviate significantly from its remuneration policy in the course of the financial year that is the object of the annual report.
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Net amounts | ||
| Buildings intended for sale | 114,958 | 94,004 |
| of which activations of borrowing costs | 3,947 | 3,189 |
| Other inventories: Brussels Europa | 1,593 | 1,586 |
| Down payment: Trebel project | 2,800 | |
| Total net carrying amount | 119,351 | 95,590 |
| Investments | Other financial investments | Derivatives | ||||
|---|---|---|---|---|---|---|
| In thousands of EUR | in related parties |
Shares | Securities, other than shares |
Loans | Total | |
| MOVEMENTS IN FINANCIAL ASSETS | ||||||
| Non-current financial assets | ||||||
| Beginning balance | 255 | 5 | 7,084 | 7,089 | ||
| Additions (investments) | ||||||
| Disposals (-) | -254 | |||||
| Reclassification (to) from other items | ||||||
| Disposals through business disposal (-) | -1,036 | -1,036 | ||||
| Impairment (losses) reversals | ||||||
| Foreign currency exchange increase (decrease) | ||||||
| Other increase (decrease) | 3 | 8,662 | 8,665 | |||
| Ending balance | 1 | 8 | 14,710 | 14,718 | ||
| Current financial assets | ||||||
| Beginning balance | 159 | 12,963 | 13,122 | 63 | ||
| Acquisitions | ||||||
| Disposals (-) | -68 | -68 | ||||
| Disposals through business disposal (-) | ||||||
| Impairments (-) | ||||||
| Other increase (decrease) | 59,785 | 59,785 | -63 | |||
| Ending balance | 91 | 72,748 | 72,839 | 0 |
The "Investments in related parties" have been reduced further to the sale of the investment of the company LA MEUTE. For lack of quotation on an active market, the financial assets are maintained at historical cost if their fair value cannot be determined reliably by a different evaluation technique.
The net value of the CITOBI shares as at 31 December 2010 amounted to 91 thousand euro. The investment of PARADISIO, having been sold on the stock market, released a slightly positive result.
The non-current "Loans" concern the advances granted to the companies consolidated by the equity method SOUTH CITY HOTEL, IMMOANGE and VICTOR PROPERTIES. The advances granted to the SOUTH CITY OFFICE FONSNY and BROODTHAERS companies were reimbursed following the sale of these two investments. As at 31 December 2010, the current "Loans" concern term deposits (more than one month) made with three Belgian banks.
The main financial risks can be summed up as follows:
(See Note 1 – Principal accounting methods – paragraph 2.10 – Exchange rate risks).
Save for the value of the real estate projects abroad (primarily stock and goodwill), the other assets and liabilities in foreign currencies do not represent important values in the group's balance sheet.
The sensitivity to variations in exchange rates of these three currencies is booked under translation adjustments. The table below covers the variations of exchange rates 2010/2009.
| Closing rate | Average rate | |||
|---|---|---|---|---|
| Exchange rate | 2010 | 2009 | 2010 | 2009 |
| Czech crown - CZK | 25.06 | 26.47 | 25.27 | 26.98 |
| Forint (Hungary) - HUF | 278.75 | 270.84 | 276.79 | 288.24 |
| Leu (Romania) - RON | 4.2848 | 4.2282 | 4.2175 | 4.2560 |
The nominal value of the investments is very close to their market value.
The item "Derivatives" which presented a balance of 63,000 euro in the assets in 2009 are detailed in note 21 (Financial liabilities and payables).
| Financial assets at fair value by means of the profit and loss account | ||
|---|---|---|
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Financial assets at fair value by means of the profit and loss account | ||
| Investments held until their maturity | 72,748 | 12,963 |
| Loans & debts | 14,710 | 7,084 |
| Financial assets available at sale | 100 | 419 |
| Derivatives | 63 | |
| Total of current and non current financial assets | 87,558 | 20,529 |
Within the framework of its project development activities, ATENOR GROUP does not realise any cover on its financial assets.
For each category of financial instrument, ATENOR supplies the methods applied to determine fair value.
No financial asset was subject to a guarantee. For more details concerning the "Commitments and contingent liabilities", please refer to note 25. Level 3: Inputs not based on observable market data
Level 1: Quoted prices on active markets
Background: the PARADISIO shares were transferred on the stock market during the financial year.
The derivatives are valued by DEXIA bank.
Level 2: Inputs (directly or indirectly) observable data, other than quoted prices None.
All the other financial assets are valued based on their book value, supported by the agreements and/or the amounts paid.
The fair value of the "Other current and non-current assets" (including liquid assets – see note 17) is close to the market value. The fair value of non-quoted financial assets available for sale is estimated at their book value, taking into account the evolution of the business of the companies concerned and existing shareholder agreements.
The fair value of the building appearing in "Investment property" was estimated based on an expert report.
| 2010 | 2009 | |||
|---|---|---|---|---|
| In thousands of EUR | Current Non-current | Current Non-current | ||
| Trade and other receivables | ||||
| Trade receivables, gross | 3,662 | 16,719 | ||
| Allowance for bad and doubtful debts | -25 | -196 | ||
| Other receivables | 2,484 | 37,819 | ||
| Total trade and other receivables | 6,121 | 54,341 | ||
| Cash and cash equivalents | ||||
| Short-term deposits | 274 | 367 | ||
| Bank balances | 2,359 | 2,056 | ||
| Cash at hand | 42 | 38 | ||
| Total cash and cash equivalents | 2,675 | 2,461 | ||
| Other assets | ||||
| Current tax receivables | 1,250 | 1,881 | ||
| Other assets | 4,370 | 83 | 10,759 | 83 |
| Total other assets | 5,620 | 83 | 12,641 | 83 |
The "Trade and other receivables" are valued at their nominal value, which is a good representation of their market value. The investments were made with Belgian financial bodies (DEXIA, ING and Van Lanschot Bankiers).
Background: in 2009, the "Other accounts receivable" primarily concerned the balance of the price for the sale of the PRESIDENT shares (33.91 million euro). The principal debtor of this receivable was HAUSINVEST EUROPA (HIE), subsidiary of C.R.I. (COMMERZ REAL INVESTMENTGESELLSCHAFT). On the date 5 March 2010, ATENOR recorded the payment of this final tranche.
Comment: In note 16 concerning the "Current and non-current financial assets", other cash investments are also booked in the amount of 72.84 million euro. The total of the liquid assets is established at 75.51 million euro.
The payment periods primarily depend upon the conditions agreed by convention at the time of transfers of investments or major assets. The trade accounts payable and other payables do not represent a significant amount of our assets and do not represent any particular risk.
| 2010 | 2009 | ||||
|---|---|---|---|---|---|
| In thousands of EUR | Deferred tax assets |
Deferred tax liabilities |
Deferred tax assets |
Deferred tax liabilities |
|
| Property, plant and equipment | 4,608 | 4,373 | |||
| Stock of buildings intended for sale | 8,211 | 8,300 | |||
| Provisions | 136 | 136 | |||
| Tax losses | 10,502 | 10,502 | |||
| Other | |||||
| Total deferred taxes related to temporary differences | 10,502 | 12,955 | 10,502 | 12,809 |
In compliance with IAS 12, ATENOR GROUP booked deferred tax assets coming from tax carried forward losses and tax credits recorded by ATENOR GROUP, BRUSSELS EUROPA and C.P.P.M.
See Note 7 concerning the deferred taxes recorded in profit and loss.
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Total of not booked deferred tax assets | 9,653 | 6,185 |
| The fiscal losses and the tax credits of ATENOR GROUP brought forward were capitalised in the amount of the future estimated taxable profits. The deferred |
The fiscal losses and the tax credits of ATENOR GROUP brought forward were capitalised in the amount of the future estimated taxable profits. The deferred tax assets not recognised amount to 9.65 million euro. The fiscal losses of the real estate companies abroad are recognised only at the time of the evidence of a taxable local basis in a foreseeable future.
| In thousands of EUR | Net deferred tax assets |
Net deferred tax liabilities |
Total |
|---|---|---|---|
| On 01.01.2009 | 10,478 | -12,648 | -2,170 |
| Deferred tax expense and income recorded in profit and loss | 24 | -161 | -137 |
| Changes in the deferred taxes recorded in equity | |||
| On 31.12.2009 | 10,502 | -12,809 | -2,307 |
| On 01.01.2010 | 10,502 | -12,809 | -2,307 |
| Deferred tax expense and income recorded in profit and loss | -237 | -237 | |
| Changes in the deferred taxes recorded in equity | 89 | 89 | |
| On 31.12.2010 | 10,502 | -12,957 | -2,455 |
| Deferred tax expense and income recorded in profit and lo | ||||
|---|---|---|---|---|
| In thousands of EUR | Guarantee provisions |
Other provisions |
Total |
|---|---|---|---|
| Provisions (both current and non-current) | |||
| Provisions, beginning balance | 1,948 | 495 | 2,443 |
| Additional provisions | |||
| Increase (decrease) to existing provisions | 681 | 681 | |
| Amounts of provisions used (-) | -628 | -628 | |
| Amounts not used but written back (-) | |||
| Increase (decrease) of the discounted amount resulting from the passage of time and the variation of the discount rate | |||
| Other increase (decrease) | |||
| Provisions, ending balance | 2,001 | 495 | 2,496 |
| Non-current provisions, ending balance | |||
| Current provisions, ending balance | 2,001 | 495 | 2,496 |
The risks connected with guarantees given or with disputes under way are the object of provisions when the conditions for recognition of these liabilities are met.
The rental "Guarantee provisions" have been adapted as a function of the occupation of the "NYSDAM" noted as at 31 December 2010. The specific guarantee for the "NYSDAM" will reach maturity on 15 September 2011 at the latest.
The disputes under way are explained in note 23 describing the Group's risk management.
The commitments and contingent liabilities are described in the note 25 to the financial statement.
| 2010 | 2009 | |||||||
|---|---|---|---|---|---|---|---|---|
| Current | Non-current | Current | Non-current | |||||
| In thousands of EUR | Up to 1 year 1-5 years | More than 5 years |
Total | Up to 1 year 1-5 years | More than 5 years |
Total | ||
| Derivatives | ||||||||
| Derivatives | 133 | 1,289 | - | 1,422 | - | 1,147 | 852 | 2,000 |
| Financial liabilities | ||||||||
| Finance lease | ||||||||
| Credit institutions | 4,966 | 7,000 | 11,966 | 13,549 | 13,549 | |||
| Bond isssue | 75,000 | 75,000 | ||||||
| Bank overdrafts | ||||||||
| Other loans | 17,870 | 17,671 | 35,541 | 56,114 | 12,487 | 5,000 | 73,601 | |
| Total financial liabilities according to their maturity |
22,836 | 99,671 | - | 122,507 | 56,114 | 26,036 | 5,000 | 87,150 |
| Trade and other payables | ||||||||
| Trade payables | 7,406 | 7,406 | 7,632 | 7,632 | ||||
| Advance received | 49 | 49 | 97 | 97 | ||||
| Social debts of which payables to employees | 614 | 614 | 626 | 626 | ||||
| Taxes | 3,866 | 3,866 | 4,171 | 4,171 | ||||
| Other payables | 13,346 | 13,346 | 4,719 | 4,719 | ||||
| Accrued charges and deferred income | 4,758 | 4,758 | 438 | 438 | ||||
| Total amount of trade payables according to their maturity |
30,039 | - | - | 30,039 | 17,682 | - | - | 17,682 |
| 2010 | 2009 | |||||||
|---|---|---|---|---|---|---|---|---|
| Current | Non-current | Current | Non-current | |||||
| In thousands of EUR | Up to 1 year 1-5 years | More than 5 years |
Total | Up to 1 year 1-5 years | More than 5 years |
Total | ||
| Derivatives | ||||||||
| Derivatives | 133 | 1,289 | - | 1,422 | - | 1,147 | 852 | 2,000 |
| Financial liabilities | ||||||||
| Finance lease | ||||||||
| Credit institutions | 4,966 | 7,000 | 11,966 | 13,549 | 13,549 | |||
| Bond isssue | 75,000 | 75,000 | ||||||
| Bank overdrafts | ||||||||
| Other loans | 17,870 | 17,671 | 35,541 | 56,114 | 12,487 | 5,000 | 73,601 | |
| Total financial liabilities according to their maturity |
22,836 | 99,671 | - | 122,507 | 56,114 | 26,036 | 5,000 | 87,150 |
| Trade and other payables | ||||||||
| Trade payables | 7,406 | 7,406 | 7,632 | 7,632 | ||||
| Advance received | 49 | 49 | 97 | 97 | ||||
| Social debts of which payables to employees | 614 | 614 | 626 | 626 | ||||
| Taxes | 3,866 | 3,866 | 4,171 | 4,171 | ||||
| Other payables | 13,346 | 13,346 | 4,719 | 4,719 | ||||
| Accrued charges and deferred income | 4,758 | 4,758 | 438 | 438 | ||||
| Total amount of trade payables according to their maturity |
30,039 | - | - | 30,039 | 17,682 | - | - | 17,682 |
The financial risks (credit, liquidity and rates) are explained through the Group's policy on indebtedness.
The Group's indebtedness is structured through direct financing concluded by the parent company and through financing, if need be, concluded by its subsidiaries. The Group finances itself with various banking partners with top ranking at international level. It maintains a strong long-term relationship with them, enabling it to deal with the Group's financing needs. The Group diversified its sources of financing from 1999 by entering into a programme of short, medium and long term commercial papers (CP/MTN) and tasked DEXIA Bank with commercialising them to private and public institutional investors. ATENOR GROUP and its subsidiaries take out the financing necessary to successfully complete the construction of real estate projects. This financing is aimed at covering the entire period of construction by making it possible to aim at commercialisation within a reasonable period of time, generally one year, after the end of the works. Within the framework of this financing, the assets in construction and the shares of ATENOR GROUP's subsidiaries are generally given in pledge to the benefit of the lending credit establishments. When the prospects for commercialisation seem favourable and offer a sufficient margin of manoeuvre concerning the promotion of the project, ATENOR GROUP may decide to finance its projects
activities of ATENOR GROUP. In addition, a "back up" line of credit has been confirmed by DEXIA Bank (maturity 31 May 2011) in the amount of 15 million euro, making it possible to strengthen the active investors in the Group's programme.
Since that time the Group has followed a policy of active communication in order to inform as widely as possible the actors of the financial markets and alleviate any drying up of the money market and any crisis independent of the situation and the directly or to finance the subsidiaries developing the projects. The financial instruments are evaluated at their fair value with variations of value assigned to the profit and loss account, except for financial instruments classified Insofar as the "Fair value hedge" is concerned, the changes in the fair value of the derivatives designated and categorised as fair value hedges are entered in the profit and loss account, just as the changes in fair value of the asset or liability hedged imputable to the risk hedged.
The financing of the Group and the financing of projects through the Group's subsidiaries are provided based on a short-term rate, the 1 to 12 month Euribor. When drawdowns are made for longer durations (from two to five years), the Group takes out advances at a fixed rate or at a floating rate accompanied by a swap transforming the floating rate into a fixed rate (IRS). Within the framework of project financing, the banks authorise drawdowns of 1 to 12 months for the duration of the financing connected with the duration of the construction. Within this framework and taking into account the budgets prepared for each project, the impact of a rise in short-term rates is limited. In addition, the part represented by financial costs in the budget of a project represent between 6 and 8% of the total. Consequently the sensitivity to a very strong variation of the short-term rates remains relatively low and limited.
ATENOR GROUP uses financial derivative instruments exclusively for the purposes of hedging.
The item "Derivatives liabilities" thus concerns the fair value of the "Interest rate swaps" (1.29 million euro) contracted by ATENOR GROUP s.a. within the framework of its long-term financing (13.00 million euro). The compensation of the "Cash flow hedges" is booked in the equity (-0.32 million euro). The changes in value of the derivatives categorised as "Fair value hedges" are entered in the profit and loss account but the changes in fair value of the liabilities hedged imputable to the risk hedged (-1.10 million euro) are imputed directly to the financial debts.
The financial liabilities are also summarised as follows:
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Financial liabilities at fair value by means of the profit and loss account |
||
| elements designated as such at the time of their initial booking |
123,605 | 88,648 |
| elements designated as being held for transaction purposes (*) |
-1,098 | -1,498 |
| Financial liabilities valued at amortised cost | ||
| Total | 122,507 | 87,150 |
* In 2010, the "fair value" adjustment of the derivatives in liabilities amounted to -1.098 million euro.
The financial indebtedness increased by 35.35 million following the bond issue in the amount of 75 million euro making it possible to reduce the Group's short term indebtedness.
The "Other loans" (35.54 million euro) mainly concern "Commercial Papers" and "Medium term notes" taken out by ATENOR GROUP s.a. within the framework of its CP/MTN programme commercialised by DEXIA Bank. The book value of the financial debts corresponds to their nominal value, corrected by the fees and commissions for setting up these credits and the adjustment connected with the valuation of the financial derivatives.
ATENOR GROUP issued, in January 2010, a bond at a fixed rate (6%) for an amount of 75 million euro. This bond issue made it possible, among other things, to transform short term indebtedness to the long term, leading to a rise in the average annual rate of interest (4.58%) borne by the Group and explaining the increase in the financial charges of the financial year 2010. This decision made it possible to sharply reduce ATENOR's sensitivity to the fluctuation in interest rates. In effect, the proportion of indebtedness at floating rate amounts to barely 8% (10 million euro) of the total of the financial debts. The variations of rates calculated in the table below show the limited impact of an increase or a decrease in short term interest rates.
| Impact of the variation of 1% of the average interest rate of the debt and the impact on the 2011 result |
Average variable interest rate |
Average interest rate of all the debt |
Impact 2011 result (in thousands of EUR) |
|---|---|---|---|
| Average interest rate | 1.4383% | 4.581% | |
| Average interest rate + 1% | 2.4494% | 4.667% | -101 |
| Average interest rate - 1% | 0.4272% | 4.496% | +101 |
| Bond issue at 6% | 18.01.2010 to 18.01.2015 |
75,000,000 |
|---|---|---|
| Credit institutions | Projects | |
| Europa (*) | 7,000,000 | |
| Media Gardens (**) | 4,965,600 | |
| Total credit institutions | 11,965,600 | |
| Other loans | Expiry dates | |
| CP | 2011 | 18,900,000 |
| MTN | 16.03.2012 | 3,000,000 |
| 29.05.2012 | 500,000 | |
| 25.10.2013 | 2,250,000 | |
| 17.11.2014 (***) | 5,000,000 | |
| 16.03.2015 | 2,000,000 | |
| 23.07.2015 (***) | 5,000,000 | |
| Total other payables | 36,650,000 |
* Whose maturity is 31.03.2012.
** Whose maturity is 31.12.2011.
*** Structures not reimbursable in 2011 according to the prevailing conditions on the financial markets at the date of publication of the Annual Report.
The "Trade and other payables" have a maturity in 2011. Please also refer to note 23 concerning the Risks Management.
The "Accrued charges" are impacted by the interest charges (4.75 million euro). The "Trade and other payables" are valued at their face value, which is a good approximation of their fair value.
For each category of financial instrument, ATENOR supplies the methods applied to determine the fair value.
Level 1: Quoted prices on active markets
The derivatives are valued by DEXIA bank.
Level 2: Inputs (directly or indirectly) observable data, other than quoted prices
None.
Level 3: Inputs not based on observable market data
All the "Financial liabilities" are valued based on their book value, supported by conventions and amounts borrowed.
The "Trade and other payables" are also valued based on their book value, supported by the conventions, invoices and amounts paid.
| In thousands of EUR | Current | Non-current | Total |
|---|---|---|---|
| Movements on financial liabilities |
Up to 1 year | More than 1 year |
|
| On 31.12.2009 | 56,114 | 31,036 | 87,150 |
| Movements of the period | |||
| - New loans | 4,417 | 79,250 | 83,667 |
| - Reimbursement of loans | -42,650 | -6,000 | -48,650 |
| - Short-term/long-term transfer | 4,549 | -4,549 | |
| - Hedging of fair marketvalue | 401 | 401 | |
| - Others | 5 | -66 | -61 |
| On 31.12.2010 | 22,836 | 99,671 | 122,507 |
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Evolution of the employee benefits | ||
| At the end of the preceding period | 337 | 535 |
| Establishment of new provisions | ||
| Transfers to "Liabilities included in disposal groups held for sale" | ||
| Amounts of provisions used or provisions reversed | -146 | -198 |
| At the end of the period | 191 | 337 |
| of which non-current pension obligation | 142 | 193 |
| of which current pension obligation | 49 | 144 |
In 2008, 2009 and 2010, the employee benefits cover the Group's insurance obligations (IAS 19) as well as the provisions set up on behalf of three people within the framework of their departure from ATENOR GROUP s.a.
As it will be recalled, in compliance with the decision of the Remuneration Committee of 13 December 2006, ratified by the Board of Directors of 31 May 2007, ATENOR GROUP on 3 August 2007 issued a total of 49,300 options on own shares to various members of the management and staff. The exercise price was set at 42.35 euro which corresponds to the average closing price of the quotes of the 30 days preceding the issue date. These options are exercisable during the periods from 28 March 2011 to 22 April 2011, from 1 October 2011 to 31 October 2011 and from 26 March 2012 to 20 April 2012.
Based on the value of the options on the date of allocation (3 August 2007), the charge was spread over four years prorata temporis. This charge amounted to 31 thousand euro in 2007, 76 thousand euro in 2008, 70 thousand euro in 2009 and 73 thousand euro in 2010. It will be 18 thousand euro in 2011. The valuation of these options was based on the following parameters (source Banque DEGROOF):
In compliance with the legislation in force, the Board of Directors of 29 May 2009 decided to grant an extension of five years to the beneficiaries of the SOP 2007 taking the final maturity to 22 April 2017, without extension of the duration of acquisition of rights.
Moreover, in compliance with the decision of the Remuneration Committee of 18 December 2007, ratified by the Board of Directors of 3 March 2008, ATENOR GROUP issued on 5 May 2008 a total of 51,100 options on own shares to various members of the management and staff. The exercise price was set at 39.17 euro which corresponds to the average closing price of the quotes of the 30 days preceding the issue date. These options are exercisable during the periods from 26 March 2012 to 20 April 2012 and from 1 October 2012 to 31 October 2012.
Based on the value of the options on the date of allocation (5 May 2008), the charge was spread over four years prorata temporis. This charge amounted to 139 thousand euro in 2008, 207 thousand euro in 2009 and 207 thousand euro in 2010. It will be 207 thousand euro in 2011 and 52 thousand euro in 2012. The valuation of these options was based on the following parameters (source Banque DEGROOF):
In compliance with the legislation in force, the Board of Directors of 29 May 2009 decided to grant an extension of five years to the beneficiaries of the SOP 2008 taking the final maturity to 31 October 2017, without extension of the duration of acquisition of rights.
The Remuneration Committee of 17 December 2008 approved the issuing of the third tranche of the stock option plan intended for members of the staff and the group's employees. This plan proposed on 20 January 2009 concerns a total of 50,600 existing shares and therefore does not give rise to the issue of new shares. These options are exercisable during the periods from 11 March to 11 April 2013 and from 2 September to 30 September 2013 at the unit price of € 37.83, i.e. the average closing price of the quotes of the 30 days preceding the issue date.
Based on the value of the options on the date of allocation (20 January 2009), the charge was spread over five years prorata temporis. This charge amounted to 86 thousand euro in 2009. It will be 94 thousand euro annually from 2010 to 2012 and 23 thousand euro in 2013.
The valuation of these options was based on the following parameters (source Banque DEGROOF):
The Board of Directors of 3 March 2009 approved a new Stock Option Plan for three years. Therefore as at 2 February 2010 ATENOR GROUP issued a first tranche of 50,000 options on own shares intended for members of the Management and the Staff. These options can be exercised during the periods from 11 March to 11 April 2014 and from 2 to 30 September 2014 at the unit price of € 36.18, i.e. the average closing price of the quotes of the 30 days preceding the issue date. - Risk-free interest rate: 1.64%. A new stock option plan was issued in February 2011. Please refer to Note 24 concerning the events after the balance sheet date.
Based on the value of the options on the date of allocation (2 February 2010), the charge was spread over five years prorata temporis. This charge amounted to 25 thousand euro in 2010. It will be 27 thousand euro annually from 2011 to 2013 and 7 thousand euro in 2014.
The valuation of these options was based on the following parameters (source Banque DEGROOF):
ATENOR GROUP has holdings in companies performing real estate projects and is also directly involved in real estate promotions.
ATENOR GROUP is faced with the risks and uncertainties inherent in this activity and, in particular, the changes in international economic trends and the markets in which the buildings are constructed, and the changes in the bases of the financial markets, such as interest rates and the volume of funds intended for investment.
The Board of Directors is attentive to the analysis and management of the various risks and uncertainties to which ATENOR GROUP and its subsidiaries are subject.
Furthermore, the Board of Directors sets out three identified risks which ATENOR GROUP faces:
It transpired that these investors might have embezzled the liquidities of the acquired companies and failed to fulfil their tax obligations by not proceeding with any reinvestment as announced. In certain cases, these tax disputes, which do not relate to ATENOR GROUP directly, have given rise to criminal complaints or civil proceedings, mainly The economic situation influences on the one hand the confidence of investors, candidate buyers for the real estate projects that ATENOR GROUP and its subsidiaries (the "Group") are developing, and on the other hand the confidence of companies in the private sector and actors in the public sector that are candidate
against the buyers and the intervening banks but also against ATENOR and certain members of its management. ATENOR GROUP, which fully and honestly cooperated in the investigations carried out by the legal and tax authoritenants for these same properties. However, the real estate promotion sector presents a time gap in comparison with the economic cycle of industries and services. For 19 years, ATENOR GROUP has
been demonstrating its ability to anticipate its decisions regarding investments, launching or disinvestment in such a way as to reduce the impact or, as need be, to take advantage of a given economic situation.
The forecasts available currently concerning the countries in which ATENOR GROUP has invested have been taken into account in the forecasts of results; if the economic situation of these countries should deteriorate beyond the given forecasts, the forecasts for ATENOR GROUP's results would have to be revised downward as a consequence.
Before every project acquisition, ATENOR GROUP conducts urban planning, technical, environmental and financial feasibility studies, most often in association with specialised external advisers.
In spite of all the precautions taken, unexpected problems connected with external factors (delays while awaiting decisions of the administrative authorities, new regulations, especially on the subject of soil pollution or energy performance, bureaucracy, environmental protection, etc.) and undetected risks can appear suddenly in projects developed by the Group, leading to delays in delivery and budget overruns.
ATENOR GROUP remains, in addition, reliant on the evolution of local markets whose supply of offices or residential units could quickly exceed the demand, leading to a risk of a reduction in rents.
The location of projects in strategic spots in capitals chosen by ATENOR GROUP constitute an important criterion in its strategy. In spite of everything, these choices remain a risk that ATENOR GROUP endeavours to anticipate and control.
The complexity of the projects, the application of the regulations, the multiplicity of the participants, the necessity of obtaining permits, of searching for and finding tenants and finally, investor buyers constitute activities and risks with which the promoter is confronted. To handle these specific risks, over many years ATENOR GROUP has established systems of control and has employees who are experienced concerning the development of offices and residential units.
The Group is obligated to comply with numerous rules concerning urban planning. It can happen that these urban planning rules are revised by the political and/or administrative authorities after ATENOR GROUP has acquired a parcel. Land allocation or the scale authorised could thus be subject to major changes in comparison with the expectations of ATENOR GROUP. The modifications that these new rules lead to could require the Group's employees and the specialised external advisers to adapt the projects and to limit the impact that these new situations lead to.
Given the complexity of certain local, regional or national regulations, and in particular the process leading to obtaining building permits, it is possible to note delays in the implementation and the start-up of a project. ATENOR GROUP has long experience in these processes and remains, nonetheless, vigilant regarding the technical and financial consequences of these situations.
The real estate projects of the Group and its subsidiaries could be exposed to risks of flooding, fire, or explosion causing their destruction or their deterioration. The Group and all its subsidiaries cover these risks to the extent possible by taking out insurance policies appropriate to the individual situation of each of the projects. The Group's employees take care to have the regulations in force complied with and ensure in the contracts concluded with all the subcontractors that they apply the mandatory safety measures.
In the event of concluding a lease, depending on the circumstances, a "loss of revenue" insurance policy could be taken out by the Group or the subsidiary concerned with the project.
ATENOR GROUP takes care to enter into leases with top-quality tenants. There is nonetheless a third-party counterpart risk, the tenant, if it defaults.
Since the Group and its subsidiaries produce real estate developments in Belgium, the Grand Duchy of Luxembourg, Romania and Hungary, with relatively little activity in the Czech Republic, they are exposed to risks connected with amendments to the laws relating to direct and indirect taxes in these countries. Concerning VAT, this risk remains limited, however, by the application of the European directives in all the countries cited.
This risk is aimed primarily at the buyers of the projects developed by the Group. In spite of the extreme precaution provided by ATENOR GROUP in the choice of investors that are candidates for buying a project, and in spite of the attention to the reputation and the solvency of these potential buyers, there is a risk of default of the counterparts and in the event of an unexpected occurrence, ATENOR GROUP's results could be affected.
The valuation of these options will be based on the following parameters:
The Board of Directors of 3 March 2009 approved a new Stock Option Plan for three years. As at 1st February 2011 ATENOR GROUP issued a second tranche of 53,200 options on own shares intended for members of the Management and the Staff. These options can be exercised during the periods from 10 March to 10 April 2015 and from 2 to 30 September 2015 at the unit price of € 33.40, i.e. the average closing price of the quotes of the 30 days preceding the issue date. On 28 February 2011, ATENOR GROUP acquired 100% of the capital of the company "SA Immobilière de la Petite Ile". As its principal assets this company holds industrial buildings on a ± 5.40 ha parcel of land located in Anderlecht, alongside the Willebroek Canal. Through this investment, ATENOR affirms its calling as a responsible urban pro-
moter. With regard to the development potential of this parcel, for ATENOR it concerns a major investment that could considerably increase ATENOR's level of activity in the Brussels Region.
No other important event since 31 December 2010 is worthy of mention.
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Guarantees constituted or irrevocably promised by third parties |
||
| Bank guarantees for security deposits(1) | 7,105 | 7,991 |
| Other security deposits received | 100 | 100 |
| companies on their own assets Mortgages (2): |
||
| accounting value of the buildings mortgaged | 7,543 | 3,437 |
| amount of the registration | 77 | 127 |
| with mortgage proxy | 17,773 | 23,723 |
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| Commitment for the acquisition of securities (3) | 1,000 | |
|---|---|---|
| Commitments for the sale of securities (4) | 14,000 | 14,000 |
| Commitments for the acquisition of buildings (5) | 25,425 | 11,215 |
| Put options held by ATENOR GROUP or its subsidiaries | 229 | |
| Call options held by ATENOR GROUP or its subsidiaries | 6,177 | |
| Put options held by third parties | 1,800 | |
| Purchase option on buildings | p.m. | p.m. |
| Various bank guarantees/other security deposits in solidarity (6) |
22,337 | 30,808 |
|---|---|---|
| Lease guarantees | 164 | 164 |
| Agreement protocol D.R.C. | 2,588 | 2,733 |
|---|---|---|
(3) Rest of the price paid in 09.2010 within the framework of the UP-site project.
| Company Name | Head Office | Fraction of the capital directly or indirectly held in % |
|---|---|---|
| Subsidiaries consolidated by the full consolidation method |
||
| ALCO BUILDING | B-1310 La Hulpe | 100.00 |
| ANAPHOR VENTURE | B-1310 La Hulpe | 95.95 |
| ATENOR GROUP Central Europe | B-1310 La Hulpe | 93.00 |
| ATENOR GROUP Hungary | H-1126 Budapest | 100.00 |
| ATENOR GROUP Luxembourg | L-1466 Luxembourg | 100.00 |
| ATENOR GROUP Romania | RO-50552 Bucharest | 100.00 |
| ATENOR REAL ESTATE | B-1310 La Hulpe | 100.00 |
| BRUSSELS EUROPA | B-1040 Brussels | 100.00 |
| BRUSSELS EUROPA PROPERTIES | B-1310 La Hulpe | 100.00 |
| BUILD UP | B-1310 La Hulpe | 100.00 |
| C.P.P.M. | B-1310 La Hulpe | 100.00 |
| CITY TOWER | H-1126 Budapest | 92.00 |
| CITY VIEW TOWER | H-1126 Budapest | 100.00 |
| DREWS CITY TOWER | H-1126 Budapest | 100.00 |
| I.D.M. | B-1310 La Hulpe | 99.64 |
| IDM A | B-1310 La Hulpe | 99.64 |
| LAURENTIDE | B-1310 La Hulpe | 100.00 |
| LAZER IMMO Sro | CZ-79661 Prostejov | 100.00 |
| NAMUR WATERFRONT | B-1310 La Hulpe | 90.00 |
| NGY Propertiers Investment | RO-11469 Bucharest | 93.00 |
| IMMOANGE | B-1160 Brussels | 50.00 |
|---|---|---|
| SOUTH CITY HOTEL | B-1160 Brussels | 40.00 |
| VICTOR ESTATES | B-1160 Brussels | 50.00 |
| VICTOR PROPERTIES | B-1160 Brussels | 50.00 |
| PLANTADEM B-1310 La Hulpe 52.42 |
|
|---|---|
| --------------------------------------- | -- |
The company SOUTH CITY OFFICE (consolidated by the equity method – 40%) was split into SOUTH CITY OFFICE FONSNY (SCOF) and SOUTH CITY OFFICE BROODTHAERS (SCOB) with retroactive effect to 1 January 2010. The sales of SCOF and SCOB respectively were finalised on 30 June and 20 December 2010.
As of the date 15 November 2010, within the framework of setting up the structure of the UP-site project, the BUILD UP s.a. company was formed by ATENOR GROUP (75%) and ATENOR GROUP Luxembourg (25%).
In accordance with the legal requirements, we report to you in the context of our appointment as statutory auditors. This report includes our opinion on the consolidated financial statements as well as the required additional statements and information.
We have audited the consolidated financial statements of ATENOR GROUP SA/ NV and its subsidiaries (the "Group") as of and for the year ended 31 December 2010, prepared in accordance with International Financial Reporting Standards, as adopted by the European Union, and with the legal and regulatory requirements applicable to quoted companies in Belgium. These consolidated financial state ments comprise the consolidated balance sheet as of 31 December 2010 and the consolidated statements of income, changes in shareholders' equity and cash flows for the year then ended, as well as the summary of significant account ing policies and other explanatory notes. The total of the consolidated balance sheet amounts to EUR 270,141,185.81 and the consolidated income statement shows a loss for the year of EUR 1,599,161.68. The annual financial statements of certain subsidiaries included in the consolidation have been audited by other external auditors. We based our audit on their audit opinions and we have carried out specific additional audit procedures in the context of the consolidation.
The company's board of directors is responsible for the preparation of the consoli dated financial statements. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of consolidated financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting poli cies; and making accounting estimates that are reasonable in the circumstances.
-
Our responsibility is to express an opinion on these consolidated financial state ments based on our audit. We conducted our audit in accordance with the legal requirements applicable in Belgium and with Belgian auditing standards, as issued by the "Institut des Réviseurs d'Entreprises/Instituut van de Bedrijfsrevisoren". Those auditing standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement.
In accordance with the auditing standards referred to above, we have carried out procedures to obtain audit evidence about the amounts and disclosures in the consolidated financial statements. The selection of these procedures is a matter for our judgment, as is the assessment of the risk that the consolidated financial statements contain material misstatements, whether due to fraud or error. In making those risk assessments, we have considered the Group's internal control relating to the preparation and fair presentation of the consolidated financial statements, in order to design audit procedures that were appropriate in the circumstances, but not for the purpose of expressing an opinion on the effective ness of the Group's internal control. We have also evaluated the appropriateness
Stéphan SONNEVILLE s.a., CEO, President of the Executive Committee and the Members of the Executive Committee, Mr Sidney D. BENS, CFO, acting in the name of and on behalf of ATENOR GROUP SA attest that to the best of their knowledge,
(1) Affiliated companies of ATENOR GROUP in the sense of article 11 of the Company Code (2) Formulated in conformity with IFRS norms.
of the accounting policies used and the reasonableness of accounting estimates made by management, as well as the presentation of the consolidated financial statements taken as a whole. Finally, we have obtained from the board of direc tors and Group officials the explanations and information necessary for our audit. We believe that the audit evidence we have obtained and the work of the other auditors who have audited the financial statements of certain subsidiaries pro vides a reasonable basis for our opinion.
In our opinion, based on our audit and on the reports of other auditors, the con solidated financial statements give a true and fair view of the Group's net worth and financial position as of 31 December 2010 and of its results and cash flows for the year then ended in accordance with International Financial Reporting Standards, as adopted by the European Union, and with the legal and regulatory requirements applicable to quoted companies in Belgium..
The company's board of directors is responsible for the preparation and content of the management report on the consolidated financial statements
Our responsibility is to include in our report the following additional comment, which does not have any effect on our opinion on the consolidated financial statements:
The statutory accounts have been drawn up in compliance with the Belgian accounting standards.
In conformity with article 105 of the Companies Code, the annual statutory accounts of ATENOR GROUP s.a. are presented in a summary form.
The submission of the consolidated statutory accounts will be made at the latest thirty days after their approval.
The auditor issued an opinion without reservation on the statutory annual accounts of ATENOR GROUP s.a.
The annual accounts, the management report and the report of the auditor are available upon simple request from the following address:
Avenue Reine Astrid, 92 in B-1310 La Hulpe.
| In thousands of EUR | 2010 | 2009 | |
|---|---|---|---|
| BALANCE SHEET | |||
| Assets | |||
| Fixed Assets | 171,970 | 147,262 | |
| I. Start-up expenses | 73 | ||
| II. Intangible assets | 57 | 59 | |
| III. Tangible assets | 413 | 508 | |
| IV. Financial assets | 171,427 | 146,695 | |
| Current Assets | 92,186 | 67,184 | |
| V. Amounts receivable after one year | |||
| VI. Stocks and orders in the course of execution | 2,834 | 6,171 | |
| VII. Amounts receivable within one year | 10,611 | 42,650 | |
| VIII. Investments | 77,928 | 17,242 | |
| IX. Cash at bank and petty cash | 544 | 960 | |
| X. Deferred charges and accrued income | 269 | 161 | |
| TOTAL ASSETS | 264,156 | 214,446 | |
| Liabilities | |||
| Group capital and reserves | 99,797 | 99,525 | |
| I. Capital | 38,880 | 38,880 | |
| IV. Reserves | 16,576 | 16,576 | |
| V. Accumulated profits | 44,341 | 44,069 | |
| Provisions and deferred taxes | 2,319 | 2,919 | |
| VII. Provisions for liabilities and charges | 2,319 | 2,919 | |
| Creditors | 162,040 | 112,002 | |
| VIII. Amounts payable after one year | 92,750 | 23,500 | |
| IX. Amounts payable within one year | 64,594 | 88,104 | |
| X. Accrued charges and deferred income | 4,696 | 398 |
TOTAL LIABILITIES 264,156 214,446
| In thousands of EUR | 2010 | 2009 |
|---|---|---|
| INCOME STATEMENT | ||
| I. Operating income | 11,354 | 5,035 |
| II. Operating charges | -17,561 | -9,647 |
| III. Operating profit (loss) | -6,207 | -4,612 |
| IV. Financial income | 2,810 | 2,493 |
| V. Financial charges | -6,614 | -2,838 |
| VI. Operating profit (loss) before taxes | -10,011 | -4,957 |
| VII. Extraordinary income | 20,633 | 7,278 |
| VIII. Extraordinary charges | -92 | -360 |
| IX. Profit of the financial year before taxes | 10,530 | 1,961 |
| X. Incomes taxes | -11 | - |
| XI. Profit of the financial year | 10,519 | 1,961 |
| XIII. Profit of the financial year to be appropriated |
10,519 | 1,961 |
| A. Profit to be appropriated | 54,588 | 57,339 |
|---|---|---|
| 1. Profit for the financial year | 10,519 | 1,961 |
| 2. Profits brought forward | 44,069 | 55,378 |
| C. Appropriations to equity (-) | - | - |
| 2. To legal reserve | - | - |
| D. Profit (loss) to be carried forward (-) | -44,341 | -44,069 |
| 1. Profit to be carried forward | 44,341 | 44,069 |
| F. Profit to be distributed (-) | -10,247 | -13,270 |
| 1. Dividends | 10,077 | 13,100 |
| 2. Director's entitlements | 170 | 170 |
The undertaking draws up and publishes the consolidated accounts and a consolidated management report in conformity with the legal arrangements.
ATENOR GROUP SA is a limited company (s.a.).
The registered office is located at Avenue Reine Astrid 92 in B-1310 La Hulpe. Article 4 of its Articles of Association specifies that the company is established for an unlimited duration.
The financial year starts on the first of January and ends on the thirty-first of December each year.
The Articles of Association are available on the website www.atenor.be.
Avenue Reine Astrid, 92 1310 La Hulpe Belgium Tel: +32-2-387 22 99 Fax: +32-2-387 23 16 e-mail: [email protected] Website: www.atenor.be Entreprise n°: VAT BE 0403 209 303
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Reuters
ATE0.BR
22 April 2011 Annual General Meeting 2010
29 April 2011 Dividend payment (subject to the approval of the GM)
19 May 2011 Intermediate declaration for first quarter 2011
31 August 2011 Half-year results 2011
18 November 2011 Intermediate declaration for third quarter 2011
1st March 2012 Annual results 2011
27 April 2012 Annual General Meeting 2011
The financial service of ATENOR GROUP is provided by Degroof Bank (designated as main paying agent), Dexia Bank (as co-domicile) or any other financial institution.
Degroof Bank (Main paying agent) Rue de l'Industrie, 44 in B-1040 Brussels
Dexia Bank (Co-domicile) Boulevard Pachéco, 44 in B-1000 Brussels
1 Dates subject to change
Design and execution: www.concerto.be
Avenue Reine Astrid, 92 B-1310 La Hulpe
Tél.: + 32 2 387 22 99 Fax: + 32 2 387 23 16
Website: www.atenor.be e-mail: [email protected]
VAT BE 0403 209 303 RPM Nivelles
Sidney D. Bens, Chief Financial Officer Tel.: + 32 2 387 22 99 Fax: + 32 2 387 23 16 e-mail: [email protected]
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