Annual Report • May 4, 2017
Annual Report
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Publicly Listed Company
Registered office: Praça do Bom Sucesso 105/159, 9º andar, Porto
Share Capital: Euro 24.000.000
Fiscal Number: 501 669 477
(Proposal point 1 of Gerneral Annual Meeting)
In compliance with legal and statutory obligations, we present to the Shareholders the Management Report and Accounts of IBERSOL - SGPS, SA for the financial year 2016.
Recent projections estimate that the Portuguese economy grew 1.5% in 2016 and should increase to 1.7% in 2017 and stabilize the growth rate in the following years. The acceleration of 2% in the fourth quarter of 2016, reflecting a higher-than-expected dynamic of most components of aggregate demand, reinforces a probable upward revision of growth to 2017.
The forecast 2017-2019, GDP should reach a level similar to that recorded in 2008. However, with growth being lower than that recorded in the euro area, it will not be possible to reverse the negative differential accumulated between 2010 and 2013.
The continuing lack of real convergence vis-à-vis the euro area reflects the persistence of structural constraints on the growth of the Portuguese economy. The high levels of public and private sector indebtedness, unfavorable demographic developments and the persistence of inefficiencies in labor markets require the continuation of structural reforms.
Measured in volume, domestically wealth is still about 4% below the levels registered before the the international financial crisis, mainly the slowdown in domestic demand (10.5% below 2008 levels) and in Investment (34% lower). On the positive side, exports stand out, 34.6% higher than the levels of 2008, which show an improvement in the tradable sector. For all the 2016, exports of goods and services increased by 4.4% in volume, maintaining the consistency of previous years.
On the other hand, the acceleration in imports shows that a significant part of domestic demand is spent on consumption and investment of goods with high imported content, with the consequent negative impact on GDP.
With regard to the labor market, it should be noted that the unemployment rate stood at 11.1% in 2016 (the lowest since 2010, which was 10.8%) and is expected to continue to fall in the following years.
The evolution of the activity of Ibersol SGPS is associated with the strategic development of its subsidiaries, whose turnover increased 16 %.
The acquisition of Eat Out Group at the end of October allowed an increase in the size of the business in Spain, bringing an additional turnover of around 23 million euros in two months.
Ibersol SGPS focused its activities in providing services of administration and management to the Group, mainly the management of the funds to financing the business.
Financial planning, the adequacy of financial resources of the subsidiaries, the management of the financial costs of the Group and a strict management of the treasury were a major vector of our activity.
The most important events occurred during the period, regarding the results and changes in financial structure of the company are as follows:
Operating income was negative at 48 thousand euros, with:
a) turnover relating to the services rendered to the subsidiary Ibersol Restauração, SA, which manages the services shared by the different brands, were equal to the last years;
b) operating costs increased to a amount of 648 thousand euros, above 151 thousand euros than the previous year as a result of additional costs incurred with the share capita increase and the acquisition of Eat Out Group .
As a consequence of the increase of loans to subsidiaries, the financial income from the interests in the Group increased by approximately 1.2 million euros. Ibersol also received 600 thousand euros of dividends from its subsidiaries. The Company has been progressively centralizing Group Debts and the costs of fees associated with medium and long-term commercial paper program contracts and guarantees. The expenses of centralized commissions increased by around 130 thousand euros
The current Income Tax is estimated at 173 thousand euros
The Net Profit amounted to € 1.31 million..
In the year the company adopted the IFRS standard and stopped applying the MEP in the valuation of investments. The comparisons for the previous year that are referred to in this report are made in relation to the re-expressed 2015 statements.
On 31 December 2016, Assets amounted to Euro 280 million, an increase of Euro 100 million in the year, reflecting the 10% internal acquisition of Asurebi SGPS (approximately Euro 20 million) and financing of the subsidiary that acquired EOG.
In order to finance the subsidiaries, Ibersol SGPS borrowed 78 million euros through commercial paper program contracts with long repayment maturities (up to 6 years)
On 31 December 2016, the company has a Net Debt of 78 million and an unremunerated debt of 20 million to Ibersol Restauração, as a result of the acquisition of the stake in Asurebi..
On 31 of December 2016, Equity equity stood at 177.5 million euros, corresponding to a reduction of 0.5 million euros, maintaining a strong financial health.
In addition, the company received dividends from its subsidiaries in the amount of 600 thousand euros and distributed to its shareholders approximately 1.8 million euros.
Risk management is a part of the Group's culture and cuts across the whole organization. It is present in every process and is the responsibility of all managers and employees at the different organizational levels.
Risk management is undertaken with the goal of creating value through management and control of uncertainties and threats that may affect the Group's companies, from a standpoint of operational continuity with a view to taking advantage of business opportunities.
In the strategic planning context, risks affecting the portfolio of existing businesses as well as the development of new businesses and more significant projects are identified and assessed. Strategies to manage those risks are then determined.
At operational level the management risks associated to each business's objectives are identified and evaluated and actions planned to manage those risks, which are included and monitored in the scope of the business plans and functional units.
The group's main internal control systems are regularly evaluated to ensure conformity of the established procedures.
Internal control and monitoring of internal control systems are conducted by the Executive Committee. Certain risk areas are due to the specific nature of the business, of which the following stand out:
Because operations are in the food service sector eventual epidemics or distortions in raw material markets along with consumption pattern changes can significantly impact the financial statements.
Practices on Corporate Governance prepared in compliance with the provisions of article 245 - A of the Securities Code and pursuant to CMVM Regulation No. 1/2010, are included in the Report on Corporate Governance annexed consolidated report.
During the year the company had the following movements of own shares:
-In August, sale of 100 shares at the average price of € 12,005
-In November, assignment of 399,980 new shares resulting from rights in capital increase by incorporation of reserves
-In November, acquisition of 25 new shares corresponding to the rights remaining from the capital increase at the average price of € 11,126.
At the end of 2016, the company held 2,399,905 shares (9.9996% of capital), with nominal value of € 1 each for a total value of the acquisition of 11,179,347 euros.
No significant events worthy of note occurred up to this report's approval date.
In a context that shows signs of a recovery in consumption, we will continue to support the very selective growth strategy of our subsidiaries in the three markets where we operate.
In the financial year of 2016 the net profit in the individual accounts is of 1,310,459.55 euros.
In accordance with legal and statutory the Board of Directors proposes the following application:
| Legal Reserve | 263, 000.00 € |
|---|---|
| Free Reserves | 1,047,459.55 € |
We also propose to pay dividends of 2,400,000 euros that corresponding to attribute a gross dividend per share of 0.10€. In the case the company holds own shares, the mentioned attribution of 0.10€ per share in circulation will stand, being the global amount of the attributed dividends reduced.
The first vote of this Board is directed to all employees of the group, for the dedication and enthusiasm revealed that was fundamental in achieving the objectives we have identified. We thank also our Suppliers of goods and services for the support demonstrated and we stress, with appreciation, the cooperation given by the banks and other financial institutions with whom the Group has worked throughout the year.
We also recognise the Fiscal Council and Auditors for the permanent collaboration and dialogue expressed in the monitoring and examination of the management of the company.
Porto, 28 April 2016
.
THE BOARD OF DIRECTORS
António Alberto Guerra Leal Teixeira
____________________________
António Carlos Vaz Pinto Sousa
____________________________
____________________________
Juan Carlos Vázquez-Dodero
Within the terms of paragraph c) of article 245 of the Portuguese Securities Code, the members of the Board of Directors, identified below, declare that to the best of their knowledge:
i) the information contained in the management report, the annual accounts and all other accounting documentation required by law or regulation, was produced in compliance with the applicable accounting standards and gives a true and fair view of the assets and liabilities, the financial position and the results of Ibersol , SGPS, S.A. . ii) the Management report is a faithful statement of the evolution of the businesses, of the performance and of the position of Ibersol , SGPS, S.A. and and contains a description of
the main risks and uncertainties which they face.
António Alberto Guerra Leal Teixeira Chairman António Carlos Vaz Pinto Sousa Vice-Chairman Juan Carlos Vázquez-Dodero Member
Individual Financial Statements
31 December 2016
| Ibersol – SGPS, SA 1 | ||||||
|---|---|---|---|---|---|---|
| Statement of financial position 3 | ||||||
| Statement of comprehensive income 5 | ||||||
| Changes in equity statement 6 | ||||||
| Cash flows statement 7 | ||||||
| Financial statements report 8 | ||||||
| 1 | INTRODUCTION 8 | |||||
| 2 | FINANCIAL STATEMENTS ACCOUNTING STANDARDS 8 | |||||
| 3 | MAIN ACCOUNTING POLICIES 13 | |||||
| 4 | CASH FLOWS 19 | |||||
| 5 | TANGIBLE FIXED ASSETS 20 | |||||
| 6 | FINANCIAL INVESTMENTS IN SUBSIDIARIES 20 | |||||
| 7 | OTHER FINANCIAL ASSETS 22 | |||||
| 8 | INCOME TAX RECOVERABLE AND PAYABLE 23 | |||||
| 9 | OTHER DEBTORS 23 | |||||
| 10 | DEFERRALS 23 | |||||
| 11 | CAPITAL 24 | |||||
| 12 | OWN SHARES 24 | |||||
| 13 | RESERVES 24 | |||||
| 14 | SUBSIDIARIES LOANS 25 | |||||
| 15 | LOANS 26 | |||||
| 16 | OTHER CURRENT LIABILITIES 27 | |||||
| 17 | PROVISIONS 27 | |||||
| 18 | SALES AND RENDERED SERVICES 28 | |||||
| 19 | EXTERNAL SUPPLIES AND SERVICES 28 | |||||
| 20 | PERSONNEL COSTS 28 | |||||
| 21 | OTHER INCOME AND GAINS 28 | |||||
| 22 | OTHER EXPENSES AND LOSSES 29 | |||||
| 23 | FINANCIAL COSTS AND INCOME 29 | |||||
| 24 | INCOME TAX 29 | |||||
| 25 | CONTINGENCIES 30 | |||||
| 26 | REMUNERATION ASSIGNED TO SOCIAL BOARD 30 | |||||
| 27 | RELATED PARTIES 31 | |||||
| 28 | INCOME PER SHARE 33 | |||||
| 29 | SUBSEQUENT EVENTS 34 |
| Notes | 2016 | 2015 | |
|---|---|---|---|
| ASSETS | |||
| Non-current Asset | |||
| Tangible fixed assets | 3.2 and 5 | - | - |
| Financial investments in subsidiaries | 3.1 and 6 | 103.727.847 | 87.016.427 |
| Other financial assets | 3.1 and 7 | 264.000 | 264.000 |
| Loans granted to subsidiaries | 14 | 166.679.496 | 88.499.496 |
| Total non-current assets | 270.671.343 | 175.779.923 | |
| Current Asset | |||
| Group subsidiaries | 14 | 7.285.243 | 3.998.524 |
| Other debtors | 9 | 22.141 | 16.023 |
| Deferrals | 10 | 400.418 | 12.710 |
| Cash and bank deposits | 3.5 and 4 | 1.496.660 | 39.338 |
| Total current assets | 9.204.462 | 4.066.595 | |
| Total Assets | 279.875.805 | 179.846.518 | |
| EQUITY AND LIABILITIES | |||
| Share capital | 3.6 and 11 | 24.000.000 | 20.000.000 |
| Own shares | 12 | -11.179.347 | -11.179.643 |
| Share prize | 469.937 | 469.937 | |
| Legal reserves | 13 | 1 | 4.000.001 |
| Other reserves Revaluation surplus |
13 | 127.582.600 12.110 |
128.238.502 12.110 |
| Retained earnings | 35.305.424 | 36.672.554 | |
| Net profit in the year | 1.310.460 | -223.658 | |
| Total Equity | 177.501.185 | 177.989.803 | |
| LIABILITIES | |||
| Non-current | |||
| Provisions | 3.10 and 17 | 1.494.968 | 294.802 |
| Loans obtained | 3.7 and 15 | 78.000.000 | - |
| Total non-current liabilities | 79.494.968 | 294.802 | |
| Current | |||
| Suppliers | 12.160 | 12.687 | |
| Income tax payable | 8 | 2.196.187 | 1.099.991 |
| Group subsidiaries | 14 | 179.272 | 173.941 |
| Loans obtained | 3.7 and 15 | - | 35.000 |
| Other current liabilities | 16 | 20.492.033 | 240.294 |
| Total current liabilities | 22.879.653 | 1.561.914 | |
| Total Liabilities | 102.374.620 | 1.856.716 | |
| Total Equity and Liabilities | 279.875.805 | 179.846.518 |
| Notes | 2016 | 2015 | ||
|---|---|---|---|---|
| Operating Income | ||||
| Rendered services | 3.12 and 18 | 600.000 | 600.000 | |
| Other operating income | 3.11 and 20 | 209 | 16.484 | |
| Total operating income | 600.209 | 616.484 | ||
| Operating Costs | ||||
| External supplies and services | 19 | 144.913 | 109.426 | |
| Personnel costs | 20 | 337.544 | 329.343 | |
| Other operating costs | 3.11 and 22 | 165.520 | 58.487 | |
| Total operating costs | 647.977 | 497.256 | ||
| Operating Income | -47.768 | 119.228 | ||
| Net financing cost | 23 | -1.530.779 | -420.224 | |
| Pre-tax income | 1.483.012 | 539.452 | ||
| Income tax | 3.8 and 24 | 172.552 | 763.111 | |
| Net profit in the year | 1.310.460 | -223.658 | ||
| Other comprehensive income: | - | - | ||
| TOTAL COMPREHENSIVE INCOME | 1.310.460 | -223.658 | ||
| Earnings per share | 28 | 0,07 | -0,01 | |
| Income per share | 0,07 | -0,01 |
| Sha re C ital ap |
Ow har n s es |
Sha rize re p |
al Res Leg erv es |
Oth er r ese rve s |
in fina Adj ust nts me nci al a ts sse |
Rev alu atio n sur lus p |
ed ear Ret ain nin gs |
Net Pro fit |
Tot al Equ ity |
|
|---|---|---|---|---|---|---|---|---|---|---|
| Bal n 1 Ja 201 5 anc e o nua ry |
20. 000 .00 0 |
11. 179 .64 3 - |
469 .93 7 |
4.0 00. 001 |
95. 460 .77 5 |
36. 482 .24 3 |
12. 110 |
- | 7.7 57. 419 |
153 .00 2.8 42 |
| Cha s in riod nge pe FRS Firs t ad opt ion of I App lica tion of fit net pro Re cla ssi fica tion ofit lica tion t pr os ne ap p fixe d a ts sse Rev alu atio luse s of ible d in ible fixe d a tan tan ts n s urp g an g sse and the ir va riat ions |
33. 085 .33 6 682 .39 1 |
36. 482 .24 3 - 7.0 75. 029 -7.0 75. 029 |
29. 597 .52 5 7.0 75. 029 |
-7.7 57. 420 |
26. 200 .61 8 0 0 0 0 |
|||||
| Par Ce l Ma ia a ditt ion ntra que Con sion - An la ver res erv es go Oth han in ity er c ges equ |
0 0 |
|||||||||
| Net fit i n th pro e y ear Tot al i nco me |
0 | 0 | 0 | 0 | 33. 767 .72 7 |
-36 .48 2.2 43 |
0 | 36. 672 .55 4 |
-7.7 57. 420 -22 3.6 58 -22 3.6 58 |
26. 200 .61 8 -22 3.6 58 -22 3.6 58 |
| Tra ctio wit h c ital s in the riod nsa ns ap ow ner pe Cap ital incr ese ase s Sha rize s in re p cre ase s Div ide nds id pa Los ses co ver age Oth tion er t ran sac s |
0 | 0 | 0 | 0 | -99 0.0 00 990 .00 0 |
0 | 0 | 0 | 0 | 0 0 -99 0.0 00 0 0 990 .00 0 |
| Bal n 3 1 D mb er 2 015 anc e o ece |
20. 000 .00 0 |
-11 .17 9.6 43 |
469 .93 7 |
4.0 00. 001 |
- 128 .23 8.5 02 |
0 | 12. 110 |
36. 672 .55 4 |
-22 3.6 58 |
- 177 .98 9.8 03 |
| Sha re C ital ap |
Ow har n s es |
Sha rize re p |
al Res Leg erv es |
Oth er r ese rve s |
in fina Adj ust nts me nci al a ts sse |
Rev alu atio n sur lus p es |
ed ear Ret ain nin gs |
Net Pro fit |
Tot al Equ ity |
|
|---|---|---|---|---|---|---|---|---|---|---|
| Bal n 1 Ja ry 2 016 anc e o nua |
20. 000 .00 0 |
11. 179 .643 - |
469 .93 7 |
4.0 00. 001 |
128 .23 8.5 02 |
- | 12. 110 |
36. 672 .55 4 |
223 .65 8 - |
177 .98 9.8 03 |
| Cha s in riod nge pe Cha s in ntin olic ies nge ac cou g p App lica tion of fit net pro Re cla ssi fica tion ofit lica tion t pr os ne ap p Sha ital incr re c ap eas e Acq uis itio n / ( dis al) of o sh pos wn are s Rea liza tion of alu atio luse s of ible d in ible tan tan rev n s urp g an g fixe d a ts sse Rev alu atio luse s of ible d in ible fixe d a tan tan ts n su rp g an g sse and the ir va riat ions Oth han in ity er c ges equ |
11 4.0 00. 000 12 |
296 | -4.0 00. 000 |
1.14 3.4 72 626 |
9.4 39. 257 -9.4 39. 257 |
1.3 67. 130 - |
-10 .58 2.7 29 10. 806 .38 7 |
0 0 0 0 922 0 0 0 |
||
| Net fit i n th pro e y ear Tot al i nco me |
4.0 00. 000 |
296 | 0 | 4.0 00. 000 - |
098 1.1 44. |
0 | 0 | 1.3 67. 130 - |
223 .65 8 1.3 10.4 60 1.3 10.4 60 |
922 1.3 10. 460 1.3 10. 460 |
| Tra ctio wit h c ital s in the riod nsa ns ap ow ner pe Cap ital incr ese ase s Sha rize s in re p cre ase s Div ide nds id pa Los ses co ver age Oth tion er t ran sac s |
0 | 0 | 0 | 0 | -1.8 00. 000 -1.8 00. 000 |
0 | 0 | 0 | 0 | 0 0 -1.8 00. 000 0 0 -1.8 00. 000 |
| Bal n 3 1 D mb er 2 016 anc e o ece |
24. 000 .00 0 |
-11 .17 9.3 47 |
469 .93 7 |
1 | 127 .58 2.6 00 |
0 | 12. 110 |
35. 305 .42 4 |
1.3 10. 459 |
177 .50 1.1 85 |
| 31st December | |||
|---|---|---|---|
| Notes | 2016 | 2015 | |
| Cash Flows from Operating Activities | |||
| Receipts from clients Payments to supliers |
600.000 | 600.000 | |
| Staff payments | 32.858 224.314 |
8.345 192.070 |
|
| Operational cash flows | 342.828 | 399.585 | |
| Payments/receipt of income tax | 301.216 | 498.244 | |
| Other paym./receipts related with operating activities | -1.535.314 | -28.761 | |
| Flows from Operating Activities (1) | -1.493.702 | -127.420 | |
| Cash Flows from Investment Activities | |||
| Payments for: | |||
| Tangible assets Intangible assests |
|||
| Financial Investments: | |||
| Investments | |||
| Capital contributions to subsidiaries | 6 | 70.000.000 | |
| Loans granted to subsidiaries | 14 | 80.200.000 | 75.730.000 |
| Other assets | |||
| Receipts from: | |||
| Tangible assets | |||
| Intangible assets | |||
| Financial investments: | |||
| Investments | 143.000.000 | ||
| Capital contributions to subsidiaries | 6 | 3.470.000 | |
| Loans granted to subsidiaries Other assets |
14 | 2.020.000 | 3.369.000 |
| Investment benefits | |||
| Interest received | 1.367.010 | 180.534 | |
| Dividends received | 23 | 600.000 | 432.100 |
| Flows from Investment Activities (2) | -72.742.990 | 1.251.634 | |
| Cash flows from financing activities | |||
| Receipts from: | |||
| Loans obtained | 15 | 78.000.000 | |
| Capital and other equity instruments increases Losses coverage |
1.675 | ||
| Other financing activities | |||
| Payments for: | |||
| Loans obtained | |||
| Interest and similar costs | 471.910 | 220.753 | |
| Dividends paid Capital reductions and supplementary entries |
1.800.000 752 |
990.000 | |
| Other financing activities | |||
| Flows from financing activities (3) | 75.729.013 | -1.210.753 | |
| Change in cash & cash equivalents (1)+(2)+(3) | 1.492.321 | -86.539 | |
| Cash & cash equivalents at the start of the period | 4.338 | 90.877 | |
| Cash & cash equivalents at end of the period | 3.5 and 4 | 1.496.660 | 4.338 |
Ibersol – SGPS, SA ("Company" or "Ibersol") has its head Office at Edifício Península – Praça do Bom Sucesso, 105/159 – 9º - 4150-146 Porto, Portugal. Ibersol was set up on 30 December 1985 with management of shareholdings main activity.
Ibersol is owned by 54,91% by ATPS - SGPS, S.A., with its head office at Edifício Península – Praça do Bom Sucesso, 105/159 – 9º - 4150-146 Porto.
These financial statements were approved by the Board of Directors on 28th April 2017. The Board of directors believes that these financial statements reflect the true and proper Ibersol operations, as well as its position and financial performance and cash flows.
These financial statements have been prepared according to the International Financial Reporting Standards (IFRS), as applied in the European Union and in force on 01 January 2016. They have been prepared in accordance with the historical cost standard.
The preparation of financial statements in accordance with IFRS requires the use of estimates, assumptions and critical judgments in the process of determining the accounting policies to be adopted by Ibersol SGPS, with a significant impact on the value of assets and liabilities, as well as income and expenses in the period
Although these estimates are based on best experience of the Board of Directors and their best expectations in relation to current and future events and actions, present and future profit may differ from these estimates. In Note 3 of these financial statements we have the areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant.
The financial statements are expressed in Euros (rounded to the unit).
In these financial statements, there hasn't been any exception involving directly the derogation of any SNC standard.
The elements contained in these financial statements are all comparable with the previous year.
The main transition adjustment was the cancellation of the equity method.
Following are the statements of financial position and comprehensive income, as well as the reconciliation of equity and results for 2015 (SNC vs. IFRS).
| 01-01-2015 | Adjustments | Restate 01-01-2015 |
|
|---|---|---|---|
| ASSETS | |||
| Non-current Asset | |||
| Tangible fixed assets | - | - | - |
| Financial investments in subsidiaries Financial investments - equity method |
50.117.031 | 17.016.427 -50.117.031 |
17.016.427 - |
| Financial investments - other methods | 264.000 | 264.000 | |
| Group subsidiaries | 31.203.279 | -15.064.783 | 16.138.496 |
| Total non-current assets | 81.584.310 | -48.165.387 | 33.418.923 |
| Current Asset | 147.295.537 | 147.295.537 | |
| Total Assets | 228.879.847 | -48.165.387 | 180.714.460 |
| EQUITY AND LIABILITIES | |||
| Equity | |||
| Share capital | 20.000.000 | 20.000.000 | |
| Own shares | -11.179.643 | -11.179.643 | |
| Share prize | 469.937 | 469.937 | |
| Legal reserves | 4.000.001 | 4.000.001 | |
| Other reserves Adjustments in financial assets |
95.460.775 36.482.243 |
33.085.336 -36.482.243 |
128.546.111 - |
| Revaluation surpluses | 12.110 | 12.110 | |
| Retained earnings | 29.597.525 | 29.597.525 | |
| Net profit in the year | 7.757.420 | 7.757.420 | |
| Total Equity | 153.002.844 | 26.200.619 | 179.203.462 |
| LIABILITIES | |||
| Non-current | |||
| Provisions | 2.551.600 | -2.546.343 | 5.257 |
| Deferrals | 71.819.663 | -71.819.663 | 0 |
| Total non-current liabilities | 74.371.263 | -74.366.006 | 5.257 |
| Current | 1.505.741 | 1.505.741 | |
| Total Liabilities | 75.877.004 | -74.366.006 | 1.510.998 |
| Total Equity and Liabilities | 228.879.848 | -48.165.387 | 180.714.460 |
| 31-12-2015 | Adjustments | Restate 31-12-2015 |
|
|---|---|---|---|
| ASSETS | |||
| Non-current Asset | |||
| Tangible fixed assets | - | - | |
| Financial investments in subsidiaries | 87.016.428 | 87.016.428 | |
| Financial investments - equity method | 59.929.779 | -59.929.779 | - |
| Financial investments - other methods | 264.000 | 264.000 | |
| Group subsidiaries | 173.564.279 | -85.064.783 | 88.499.496 |
| Total non-current assets | 233.758.057 | -57.978.134 | 175.779.924 |
| Current Asset | 4.066.595 | 4.066.595 | |
| Total Assets | 237.824.652 | -57.978.134 | 179.846.519 |
| EQUITY AND LIABILITIES | |||
| Equity | |||
| Share capital | 20.000.000 | 20.000.000 | |
| Own shares | -11.179.643 | -11.179.643 | |
| Share prize | 469.937 | 469.937 | |
| Legal reserves | 4.000.001 | 4.000.001 | |
| Other reserves | 95.153.166 | 33.085.336 | 128.238.501 |
| Adjustments in financial assets | 42.552.623 | -42.552.623 | 0 |
| Revaluation surpluses | 12.110 | 12.110 | |
| Retained earnings Net profit in the year |
10.582.729 | 36.672.554 -10.806.387 |
36.672.554 -223.658 |
| 161.590.923 | 16.398.881 | 177.989.803 | |
| Total Equity | |||
| LIABILITIES | |||
| Non-current | |||
| Provisions | 2.852.154 | -2.557.352 | 294.802 |
| Deferrals | 71.819.663 | -71.819.663 | - |
| Total non-current liabilities | 74.671.817 | -74.377.015 | 294.802 |
| Current | 1.561.914 | 1.561.914 | |
| Total Liabilities | |||
| 76.233.730 | -74.377.015 | 1.856.715 | |
| Total Equity and Liabilities | 237.824.653 | -57.978.134 | 179.846.518 |
| 31-12-2015 | 2015 Equity method adjustments |
Restate 31-12-2015 |
||
|---|---|---|---|---|
| INCOME AND COSTS | ||||
| Sales | 600.000 | 600.000 | ||
| Gains/losses accrued to subsidiaries, associates and joint undertakings | 11.316.163 | -11.316.163 | - | |
| External supplies and services | -109.426 | -109.426 | ||
| Personnel costs | -329.343 | -329.343 | ||
| Provisions (increases / decreases) | -11.009 | 11.009 | - | |
| Impairment of non-depreciable assets/ amortizable (losses / reversals) | -66.667 | 66.667 | - | |
| Other operating income | 16.484 | 16.484 | ||
| Other operating costs | -58.487 | -58.487 | ||
| Income before depreciation, financing costs and taxes | 11.357.715 | -11.238.487 | 119.228 | |
| Impairment of depreciable assets/ amortizable (losses / reversals) | - | - | - | |
| Operating income (before financing costs and taxes) | 11.357.715 | -11.238.487 | 119.228 | |
| Interest and other financial income obtained | 180.534 | 432.100 | 612.634 | |
| Interest and other financial costs paid | -192.410 | -192.410 | ||
| Pre-tax income | 11.345.839 | -10.806.387 | 539.452 | |
| Income tax | -763.111 | -763.111 | ||
| Net profit in the year | 10.582.728 | -10.806.387 | -223.659 | |
| Earnings per share | 0,59 | -0,60 | -0,01 | |
| a) | Equity SNC 31-12-2015 | 161.590.923 | ||
| Equity method cancellation | 16.398.880 | |||
| Equity IFRS 31-12-2015 | 177.989.803 | |||
| b) | Net profit in the year SNC 2015 | 10.582.728 | ||
| -Equity method earnings cancellation MEP | -11.238.487 |
-Dividends received from subsidiaries recognition 432.100 Net profit in the year IFRS 2015 -223.659
produce growing on bearer plants will remain within the scope of IAS 41 - Agriculture. This standard does not apply to the entity, which does not have agriculture bearer plants.
a) IAS 7 (amendment), 'Cashflow statement – Disclosure initiative' (effective for annual periods beginning on or after 1 January 2017). This amendment is still subject to endorsement by the European Union. This amendment introduces an additional disclosure about the changes in liabilities arising from financing activities, disaggregated between cash changes and non-cash changes and how it reconciles with the reported cash flows from financing activities, in the Cash Flow Statement. Its application is not expected to have significant impacts.
Annual Improvement 2014 – 2016 (generally effective for annual periods beginning on or after 1 January 2017). These improvements are still subject to endorsement by European Union. The 2014-2016 annual improvements impacts: IFRS 1, IFRS 12 and IAS 28. Its application is not expected to have significant impacts.
The main accounting policies applied in preparing these financial statements are described below. Unless stated these policies have been consistently applied to all years presented.
Subsidiaries are all entities in which Ibersol directly or indirectly has the power to control their financial and operational activities, which is usually associated with holding more than half of the voting rights. The existence and the effect of potential voting rights are considered in the evaluation of the control over a subsidiary.
Associates are entities over which the company has between 20% and 50% of the voting rights or on which the company has significant influence, but which cannot exercise its control.
Investments in subsidiaries and associates are presented at cost. Dividends attributed by subsidiaries and associates are considered in financial results.
Investments in subsidiaries and associates are subject to impairment tests whenever there are indications of impairment. An impairment loss is recognized in the income statement of the amount of the excess of the initial amount of the asset over its recoverable amount. The recoverable amount is the higher of the fair value of an asset less the costs incurred to sell and its value in use. To perform impairment tests, each investment is analyzed separately.
The entities that qualify as subsidiaries and associates are listed in note 27.
Ibersol, SGPS, S.A. prepares consolidated accounts.
Tangible fixed assets are shown at the acquisition cost, net of the respective amortisation and accumulated impairment losses. This includes estimated cost at the date of transition to NCRF, and acquisition costs to assets acquired after that date
The historic cost includes all expenses attributable directly to the acquisition of goods.
Subsequent costs are added to the amounts for which the good is recorded or recognised as separate assets, as appropriate, only when it is probable that the company will obtain the underlying economic benefits and the cost may be reliably measured.
Other expenses on repairs and maintenance are recognised as an expense in the period in which they are incurred.
The estimated lifetime for the most significant tangible fixed assets are as follows:
| Years | |
|---|---|
| Land and buildings | Between 10 and 20 years |
| Equipment | Between 4 and 20 years |
| Other tangible assets | Between 5 and 10 years |
Depreciation of assets is calculated by the equal annual amounts method, accordingly with accounting policies in force (DR nº 25/2009 14 September). Depreciation of tangible fixed assets begins when they are available for use.
The estimated lifetime of assets are reviewed each year, in which the depreciation is evaluated with the standards of use of assets. Changes to the estimated lifetime are treated as a change in accounting estimate and are applied prospectively.
Impairment tests are carried out whenever there is evidence of loss of value to estimate the recoverable amount of the asset, and when necessary to record an impairment loss. The recoverable amount is determined as the higher of net selling price and value in use of the asset, the latter being calculated based on the present value of estimated future cash flows from continuing use and disposal of the asset at the end of its useful life
Gains and losses consequent to a reduction or sale are determined by the difference between receipts from the sale and the asset's accounted value, and are recognised in the profit and loss account.
Assets with a specific lifetime are not subject to amortisation and are, instead, subject to annual impairment tests. Ibersol performs impairment test in reference to 31st December of each year and whenever there are events or alterations in the circumstances causing their accounting value not to be recoverable.
Ibersol identifies an impairment loss and determines whether the loss is permanent or not whenever the recoverable amount is less than the carrying value of assets. In cases where the loss is not considered permanent and definitive, Ibersol makes the disclosure of the reasons for this conclusion.
The recoverable amount is the highest amount between an asset's fair value minus the costs necessary for its sale and its utilisation value. Assets are grouped at the lowest level at which it may be able to separately identify cash flows (units generating cash flows), to perform impairment tests.
At each reporting date, non-financial assets with impairment, other than goodwill, are assessed on the possible reversal of impairment losses.
Amortisation and depreciation of assets are recalculated prospectively in accordance with the recoverable value when there is an impairment reversal.
The group classifies its financial assets under the following categories: financial assets at the fair value through results, loans granted and accounts receivable, investments held until maturity and financial assets available for sale. The investment is classified according to its purpose. The Board of Directors decides on the classification when the investments are initially recorded and re-assesses that classification at each report date.
This category is subdivided into two parts: financial assets held for negotiation and those that are designated at the fair value through results from the start. A financial asset is classified in this category if it is acquired for the main purpose of being sold on the short term or if designated as such by the Board of Directors. Derivatives are also classified as held for negotiation, except if they are classified for hedging. Assets in this category are classified as current if they are held for negotiation or are realisable within 12 months after the consolidated statement of financial position date.
Loans granted and other credits are non-derivative financial assets with fixed or determinable payments and that are not listed on an active market. These assets originate when the group supplies cash, goods or services directly to a debtor, without intending to negotiate the time at which it will receive payment for the said cash goods or services. They are included in current assets, except when they mature in more than 12 months after the consolidated statement of financial position date, in which case they are classified as non-current assets.
Investments held until maturity is non-derivative financial assets with fixed or determinable payments and fixed maturities, which the group's Board of Directors has the intention and capacity to maintain until maturity. These investments are included in non-current assets, except those falling due within 12 months as of the consolidated statement of financial position date, which are classified as current assets.
Financial assets available for sale are non-derivative assets which are designated in this category or are not classified in any of the other categories. They are included in non-current assets, except when the Board of Directors wishes to sell the investment within 12 months as of the consolidated statement of financial position date.
Purchases and sales of investments are recognised on the transaction date – the date on which the group promises to purchase or sell the asset. Investments are initially recognised at the fair value, including transaction costs, when the financial assets are not shown at the fair value through results (in this case, they are also recognised at the fair value, but the transaction costs are recorded in costs in the year at the time they are incurred). Financial investments are derecognised when the rights to receive cash from them expire or have been transferred and the group has substantially transferred all the risks and benefits from its possession. Financial assets available for sale and financial assets at the fair value through results are subsequently valuated at the fair value. Loans granted and accounts receivable and investments held until maturity are valuated at the amortised cost, using the effective rate method. Gains and losses - either realised or not realised and arising from alterations to the fair value of the category of the financial assets at their fair value through results - are included in the consolidated statement of comprehensive income in the year in which they arise. Unrealised gains and losses, resulting from alterations to the fair value of non-monetary securities, classified as available for sale, are recognised in the equity. When the securities classified as available for sale are sold or are under impairment, the accumulated adjustments to the fair value are included in the consolidated statement of comprehensive income as gains or losses in securities investments.
The fair value of listed investments is based on current market prices.
If there is no active market for a financial asset (and for non-listed securities), the group determines the fair value using evaluation techniques, which include using recent transactions between independent parties, reference to other instruments that are substantially identical, an analysis of the discounted cash flow and refined options price models that reflect the specific emission circumstances.
On each consolidated statement of financial position, the group checks for objective evidence showing whether any group of financial assets is subject to impairment. In the event of equity securities classified as available for sale, a significant or lasting decrease in the fair value falling below the cost value is determinant for knowing if there is impairment. If there is evidence of impairment applicable to financial assets available for sale, the accumulated loss – calculated by the difference between the acquisition cost and the current fair value, minus any impairment loss of that financial asset previously recognised in results – is removed from equity and recognised in the consolidated statement of comprehensive income. Impairment losses from capital instruments recognised in results are not reversible.
The group complies with the guidelines of IAS 39 (reviewed in 2004) to determine the permanent impairment of investments. This measure requires that the group valuate, among other factors, the duration and the extent to which the fair value of an investment is less than its cost, the financial health and business outlook for the subsidiary, including factors such as the industry's and sector's performance, technological alterations and flows of operating cash and financing.
Cash and cash equivalents include cash amounts, bank deposits, other short term investments with high liquidity and initial maturities of up to 3 months and bank overdrafts. Bank overdrafts are presented in the balance sheet, in current liabilities, in the Obtained Loans item, and are considered in the the cash flow statement as cash and cash equivalents.
When effected ordinary shares are classified in equity. Incremental costs directly attributable to the emission of new shares or options are presented in equity as a deduction, net of taxes, of entries.
Loans obtained are initially recognised at the fair value, including incurred transaction costs. Medium and long term loans are subsequently presented at cost minus any amortisation; any difference between receipts (net of transaction costs) and the amortised value is recognised in the profit and loss account during the loan period, using the effective rate method.
Loans obtained are classified in current liabilities, except when Ibersol is entitled to an unconditional right to defer the liquidation of the liability for at least 12 months after the balance sheet date.
Income tax for the period comprises current and deferred taxes. Income taxes are recorded in the income statement, except when they relate to items recognised directly in equity. The value of current tax payable is determined based on the result before taxes, adjusted in accordance with the tax rules in force.
Deferred taxes are recognised overall, using the liability method and calculated based on the temporary differences arising from the difference between the taxable base of assets and liabilities and their values in the financial statements.
Deferred taxes are determined by the tax (and legal) rates decreed or substantially decreed on the date of the balance sheet and that can be expected to be applicable in the period of the deferred tax asset or in the liquidation of the deferred tax liability.
Deferred tax assets are recognised insofar as it will be probable that future taxable income will be available for using the respective temporary difference. Deferred tax liabilities are recognised for all temporary differences, except those related to: i) the initial recognition of goodwill; or ii) the initial recognition of an asset or liability in a transaction that is not a corporate concentration or that, on the transaction date, does not affect the accounting result or the tax result. However, in respect of taxable temporary differences related to investments in subsidiaries, these are not recognised because: i) the parent company has the ability to control the amount of the reversal of the temporary difference; and ii) it is probable that the temporary difference will not be reverse in the near future.
The estimated income tax (IRC) was calculated under the special taxation regime (RETGS), and the Group decided that the expense / income recognized in the subsidiaries will be reflected in other liabilities / current assets with the parent company (Note 14.2), and the tax savings being reflected in the accounts of the parent company.
The employee performance premiums are recorded in the year to which they relate, regardless of the year in which the payment occurs.
Provisions for costs of restructuring activities, paid contracts and legal claims are recognised when: i) Ibersol has a legal or constructive obligation due to past events; ii) it is probable that a outflow of resources will be necessary to liquidate the obligation; e iii) the obligation amount may be reliably estimated. Whenever one of the criteria is not met or the existence of the obligation is subject to the occurrence (or not) of a certain future event, Ibersol discloses a contingent liability, unless the enforceability for payment is considered remote.
Provisions are measured at the present value of estimated expenditures to settle the obligation using a pre-tax rate that reflects market assessment for the period of discount and to the risk of that provision.
In accordance with the principle of accrual accounting expenses and income are recorded in the period to which they relate, regardless of their payment or receipt. The differences between the amounts received and paid and the corresponding revenues and expenses are recognised as assets or liabilities
Revenue comprises the fair value of the sale of rendering of services from Ibersol's activities, net of taxes and discounts and after eliminating internal sales.
Rendering of services is recognised in the accounting period in which the services are rendered, in accordance with the percentage of completion or based on the period of the contract when the service is not associated with the implementation of specific activities, but to provide continuous service.
Estimates and judgements are continuously evaluated and are based on past experience and on other factors, including expectations regarding future events that are believed to be reasonably probable within the respective circumstances.
Due to its nature accounting based on estimates rarely corresponds to the real reported results. Estimates and premises that present a significant risk of leading to a material adjustment in the accounting value of the assets and liabilities in the following year are described below:
The company determines periodically if any obligations arising from past events should be merit recognition or disclosure.
The determination if an amount of internal resources is required for the payment of obligations is very subjective and could lead to significant adjustments, either by variation of the assumptions used, either by the future recognition of provisions previously disclosed as contingent liabilities.
The determination of a potential impairment loss can be triggered by the occurrence of various events, which are outside the sphere of Ibersol influence, such as: the future availability of funding, the cost of capital, as well as for any other changes, either internal or external.
It is expected from the Board of Directors a high degree of judgement as regards the identification of indicators of impairment, the estimate of future cash flows and the determination of fair value of assets entail and evaluation of different indicators of impairment, expected cash flows, discount rates applicable, useful lives and residual values.
The company recognizes liabilities for additional settlements of taxes which may result from inspections made by the tax authorities. When the final result of tax inspections is different from the values initially recorded, differences will impact the income tax and deferred taxes, in the period in which such differences are identified.
The group's activities are exposed to a number of financial risk factors: market risk (including interest rate risk), credit risk, liquidity risk and capital risk.
Ibersol maintains a risk management program that focuses its analysis on financial markets to minimise the potential adverse effects of those risks on the Ibersol's financial performance.
Risk management is headed by the Financial Department based on policies approved by the Board of Directors. The treasury identifies, evaluates and employs financial risk hedging measures in close cooperation with the group's operating units. The Board provides principles for managing the risk as a whole and policies that cover specific areas, such as the currency exchange risk, the interest rate risk, the credit risk and the investment of surplus liquidity.
Ibersol main interest rate risk follows its liabilities, in particular long-term loans. Loans issued with variable rates expose the group to the cash flow risk associated to interest rates. Loans with fixed rates expose the group to the risk of the fair value associated to interest rates. At the current interest rates, in financing of longer maturity periods the group has a policy of totally or partially fixing the interest rates.
Ibersol's credit risk stems from its liabilities, in particular from loans to subsidiaries. The credit risk is assured by the company's financial Direction, taking into account the historic trading relationship, its financial situation, as well as other information that may be obtained through the network business of Ibersol. If necessary, the credit limits established are regularly reviewed and revised. Credit risk is reduced.
Liquidity risk management implies maintaining a sufficient amount of cash and bank deposits, the feasibility of consolidating the floating debt through a suitable amount of credit facilities and the capacity to liquidate market positions. Treasury needs are managed based on the annual plan that is reviewed every quarter and adjusted daily. Related with the dynamics of the underlying business operations, the group's treasury strives to maintain the floating debt flexible by maintaining credit lines available.
At 31 December 2016, current liabilities amounted to Euro 23 million, compared to Euro 9 million in current assets. The current liability debt is mainly with the group, subsidiary Ibersol Restauração (Note 16).
The company aims to maintain an equity level suitable to the characteristics of its main business (cash sales and credit from suppliers) and to ensure continuity and expansion. The capital structure balance is monitored based on the gearing ratio (defined as: net remunerated debt / net remunerated debt + equity) in order to place the ratio above 35%.
On 31st December 2016 and 2015 the gearing ratio was as follows:
| Dec-16 | Dec-15 | |
|---|---|---|
| Loans granted Loans obtained |
-166.679.496 78.000.000 |
-88.499.496 - |
| Cash and bank deposits Net indebtedness |
-1.496.660 -90.176.156 |
-90.877 -88.590.373 |
| Equity | 177.501.185 | 153.002.842 |
| Total capital | 87.325.029 | 64.412.469 |
| Gearing ratio | -103% | -138% |
On 31 December 2016 and 2015, cash and bank deposits are broken as follows:
| 2016 | 2015 | |
|---|---|---|
| Bank deposits | 1.496.660 | 39.338 |
| Cash and bank deposits | 1.496.660 | 39.338 |
"Cash and cash equivalents" for the preparation of the statement of cash flows for the years ended December 31, 2016 and 2015 is as follows:
| 2016 | 2015 | |
|---|---|---|
| Bank deposits | 1.496.660 | 39.338 |
| Term deposits | - | - |
| Other deposits | - | - |
| 1.496.660 | 39.338 | |
| Cash and cash equivalents (asset) | 1.496.660 | 39.338 |
| Cash equivalents (liabilities) Cash and cash equivalents |
- | -35.000 |
| on the cash flows statement | 1.496.660 | 4.338 |
As the assets are fully reinstated, in the years ending on 31 December 2016 and 2015, there has been no movement in tangible fixed assets and no depreciations.
| Land and buildings |
Basic equipment |
Transport equipment |
Office equipment |
Other tang. Assets |
Total | |
|---|---|---|---|---|---|---|
| 31 December 2016 | ||||||
| Cost | 29.828 | 3.736 | - | 215.338 | 18.289 | 267.191 |
| Accumulated depreciation | 29.828 | 3.736 | - | 215.338 | 18.289 | 267.191 |
| Accumulated impairment | - | - | - | - | - | - |
| Net amount | - | - | - | - | - | - |
Financial investments in subsidiaries are as follows:
| 2016 | 2015 | |
|---|---|---|
| Financial investments (6.1) | 22.133.064 | 1.951.644 |
| Supplementary capital contributions (6.2) | 81.594.783 | 85.064.783 |
| 103.727.847 | 87.016.426 |
Ibersol's financial investments are stated in the balance sheet by the cost method, as follows:
| 2016 | 2015 | |
|---|---|---|
| Acquisition value |
Acquisition value |
|
| Subsidiaries | ||
| Asurebi SGPS, S.A. | 20.181.420 | - |
| Ibersol Restauração, S.A. | 847.986 | 847.986 |
| Iberusa-Hotelaria e Restauração, S.A. | 158.119 | 158.119 |
| Ibersol Madeira Restauração, S.A. | 242.800 | 242.800 |
| Restmon Portugal, Lda | 499.448 | 499.448 |
| Eggon - SGPS, S.A. | 645.000 | 645.000 |
| Ibergourmet-Prod.Alimentares, S.A. | 57.020 | 57.020 |
| Ibersol Angola, S.A. | 720 | 720 |
| 22.632.512 | 2.451.092 | |
| Accumulated impairment losses | -499.448 | -499.448 |
| 22.133.064 | 1.951.644 |
In the year ending on 31 December 2016 and 2015, changes under investments in subsidiaries are presented as follows:
| Ibersol Rest., S.A. |
Ibersol Madeira Rest., S.A. |
Iberusa Hotelaria e Rest., S.A. |
Asurebi SGPS, S.A. |
Eggon - SGPS, S.A. |
Restmon Portugal, Lda |
Ibergourmet Prod.Alimen., S.A. |
Ibersol Angola, S.A |
Total | |
|---|---|---|---|---|---|---|---|---|---|
| 1st January 2015 | 9.172.786 | 2.012.585 | 1.106.044 | - | 1.556.455 | - | 603.872 | 3.796 | 14.455.538 |
| First adoption of IFRS | -8.324.800 | -1.769.785 | -947.925 | - | -911.455 | 499.448 | -546.852 | -3.076 | -12.004.445 |
| Acquisition | - | - | - | - | - | - | - | - | - |
| Gains/losses | - | - | - | - | - | - | - | - | - |
| Fair value adjustments | - | - | - | - | - | - | - | - | - |
| Other movement in Equity | - | - | - | - | - | - | - | - | - |
| Dividends received | - | - | - | - | - | - | - | - | - |
| 31st December 2015 | 847.986 | 242.800 | 158.119 | - | 645.000 | 499.448 | 57.020 | 720 | 2.451.092 |
| Ibersol | Ibersol Madeira |
Iberusa Hotelaria e |
Asurebi | Eggon - SGPS, |
Restmon Portugal, |
Ibergourmet Prod.Alimen., |
Ibersol Angola, |
Total | |
|---|---|---|---|---|---|---|---|---|---|
| Rest., S.A. | Rest., S.A. | Rest., S.A. | SGPS, S.A. | S.A. | Lda | S.A. | S.A | ||
| 1st January 2016 | 847.986 | 242.800 | 158.119 | - | 645.000 | 499.448 | 57.020 | 720 | 2.451.092 |
| Acquisition/sale | - | - | - | 20.181.420 (1) | - | - | - | - | 20.181.420 |
| Gains/losses | - | - | - | - | - | - | - | - | - |
| Fair value adjustments | - | - | - | - | - | - | - | - | - |
| Other movement in Equity | - | - | - | - | - | - | - | - | - |
| Dividends received | - | - | - | - | - | - | - | - | - |
| 31st December 2016 | 847.986 | 242.800 | 158.119 | 20.181.420 | 645.000 | 499.448 | 57.020 | 720 | 22.632.512 |
(1) acquisition on October 3, 2016 of 421.500 shares (10% capital) of the subsidiary Asurebi to Ibersol Restauração, amount witch was outstanding on December 31, 2016 (Note 16).
Assets and liabilities on 31 December 2016 and 2015, and gain and losses earned in 2016 and 2015, as recognised in the separate financial statements of subsidiaries are as follows:
| 2016 | ||||||||
|---|---|---|---|---|---|---|---|---|
| Asurebi SGPS, S.A. |
Ibersol Rest., S.A. |
Ibersol Madeira Rest., S.A. |
Iberusa Hotelaria e Rest., S.A. |
Eggon SGPS, S.A. |
Restmon Portugal, Lda |
Ibergourmet Prod.Alimen., S.A. |
Ibersol Angola, S.A. |
|
| Equity | 171.020.167 | 96.111.377 | 1.958.418 | 74.315.320 | 35.841.282 | -2.220.652 | 2.944.926 | 6.466.668 |
| Total income | 31.948.899 | 23.943.613 | 863.369 | 9.707.679 | 6.003 | -17.546 | 424.926 | 2.724.624 |
| % Investment | 10,00% | 100,00% | 100,00% | 5,00% | 2,11% | 61,00% | 100,00% | 0,20% |
| Acquisition value | 20.181.420 | 847.986 | 242.800 | 158.119 | 645.000 | 499.448 | 57.020 | 720 |
| 2015 | |||||||
|---|---|---|---|---|---|---|---|
| Ibersol Rest., S.A. |
Ibersol Madeira Rest., S.A. |
Iberusa Hotelaria e Rest., S.A. |
Eggon SGPS, S.A. |
Restmon Portugal, Lda |
Ibergourmet Prod.Alimen., S.A. |
Ibersol Angola, S.A. |
|
| Equity | 84.140.734 | 1.797.813 | 67.434.658 | 25.411.898 | -2.203.105 | 2.520.000 | 4.669.099 |
| Total income % Investment |
9.460.941 100,00% |
610.245 100,00% |
360.066 5,00% |
546.792 2,11% |
-18.721 61,00% |
414.186 100,00% |
625.273 0,20% |
| Acquisition value | 847.986 | 242.800 | 158.119 | 645.000 | 499.448 | 57.020 | 720 |
The impairment tests carried out on the investments of the subsidiaries Asurebi and Iberusa did not result in impairment adjustments. The assumptions used were as follows:
| Growth rate | |
|---|---|
| Portugal | 2,00% (1% real + 1% inflation) |
| Discount rate | |
| Portugal | 6,70% |
On 31 December 2016 and 2015, balances recognised under this heading relate to subsidiaries supplementary capital contributions. Subsidiaries supplementary capital contributions are not remunerated, or have no fixed maturity.
| 2016 | ||||||
|---|---|---|---|---|---|---|
| Iberusa | Ibersol Restauração |
Eggon | Ibergourmet | Ibersol Angola |
TOTAL | |
| Subsidiaries Supplementary capital contributions |
9.765.000 | 70.000.000 | 640.000 | 1.185.000 | 4.783 | 81.594.783 |
| Accumulated impairment losses Total |
- 9.765.000 |
- 70.000.000 |
- 640.000 |
- 1.185.000 |
- 4.783 |
- 81.594.783 |
| 2015 | ||||||
| Iberusa | Ibersol Restauração |
Eggon | Ibergourmet | Ibersol Angola |
TOTAL | |
| Subsidiaries Supplementary capital contributions |
12.000.000 | 70.000.000 | 1.875.000 | 1.185.000 | 4.783 | 85.064.783 |
| Accumulated impairment losses Total |
- 12.000.000 |
- 70.000.000 |
- 1.875.000 |
- 1.185.000 |
- 4.783 |
- 85.064.783 |
Changes in this heading, are presented as follows:
| 2016 | 2015 | |
|---|---|---|
| Initial amount | 85.064.783 | 15.064.783 |
| Additions | - | 70.000.000 |
| Decreases | 3.470.000 | - |
| Final amount | 81.594.783 | 85.064.783 |
According to the General Assembly of 18 December 2015, 70 million euros loans granted to subsidiary Ibersol Restauração were converted in capital contributions.
On 31 December 2016 and 2015, the assets recognized under this heading relate to capital shares, as follows:
| % own | 2016 | 2015 | |
|---|---|---|---|
| Change Partners I, SGPS, S.A. | 3,08% | 264.000 | 264.000 |
| Total | 264.000 | 264.000 |
The primary business of Change Partners I, SGPS, S.A., is management of shareholdings. This investment is valued at cost because it is not possible to determine reliably the fair value.
On 31 December 2016 and 2015, Income tax is presented as follows:
| 2016 2015 |
||||
|---|---|---|---|---|
| Debit balance | Credit balance | Debit balance | Credit balance | |
| Income tax - IRC (1) | - | 2.196.187 | - | 1.099.991 |
| - | 2.196.187 | - | 1.099.991 |
(1) by applying the special taxation for corporate groups (RETGS), the shareholder Ibersol - SGPS, SA will carry out payments of its subsidiaries income tax (Note 14.2).
For the periods presented the credit balance of income tax has the following breakdown:
| 2016 | 2015 | |
|---|---|---|
| Special payment on account | -29.896 | -101.355 |
| Payments on account | -2.498.358 | -1.652.622 |
| Withholding taxes | -425 | - |
| Income tax - IRC (Note 23) | 198.720 | 24.154 |
| Income tax - RETGS | 4.526.147 | 2.829.814 |
| Total | 2.196.187 | 1.099.991 |
On 31 December 2016 and 2015, the detail of other current debtors is as follows:
| 2016 | 2015 | ||||
|---|---|---|---|---|---|
| Current | Total | Current | Total | ||
| Other debtors: | |||||
| - Other debtors | 20.731 | 20.731 | 13.318 | 13.318 | |
| Sub-total | 20.731 | 20.731 | 13.318 | 13.318 | |
| Personnel | 1.410 | 1.410 | 2.705 | 2.705 | |
| Sub-total | 1.410 | 1.410 | 2.705 | 2.705 | |
| Accumulated impairment losses | - | - | - | - | |
| Other debtors | 22.141 | 22.141 | 16.023 | 16.023 |
On 31 December 2016 and 2015 the Ibersol has recorded under the heading of deferrals, the following balances:
| 2016 | 2015 | |
|---|---|---|
| Insurance | 2.755 | 2.774 |
| Rents | 3.353 | 3.353 |
| Financial fees (1) | 394.311 | 6.583 |
| Deferred costs | 400.418 | 12.710 |
(1) Concerning commercial paper contracted (note 15).
On April 29, 2016, share capital increased with legal reserve incorporation in the amount of 4.000.000 euros, with the creation of 4.000.000 new shares, distributed free of charge to shareholders in proportion to a new share for each group of 5 shares already held.
On 31 December 2016, fully subscribed and paid up share capital was represented by 24.000.000 shares to the bearer with a par value of 1 euro each.
With the share capital increase, Ibersol increased its own shares by 399.980. In addition it sold 100 shares and acquired 25 in 2016. In the year 2015 the company did not carry out any transactions with own shares.
Shares are subject to the regime established for own shares which determines that their voting rights and assets are suspended for as long as they remain in the ownership of the group, without prejudice of being sold.
At the end of the year the company held 2.399.905 own shares acquired for 11.179.347 euros. According to the legislation in force, Ibersol shall maintain a non-available reserve by the same amount of the purchase of own shares. This reserve is included in Other reserves.
On December 2016 and 2015, reserves were broken down as follows:
| Legal reserves | |||
|---|---|---|---|
| 2016 | 2015 | ||
| 4.000.001 | 4.000.001 | ||
| - | - | ||
| 4.000.000 | - | ||
| 1 | 4.000.001 | ||
On April 29, 2016, share capital increased with legal reserve incorporation in the amount of 4.000.000 euros.
| Own shares reserves | Other reserves | |||
|---|---|---|---|---|
| 2016 | 2015 | 2016 | 2015 | |
| 1st January | 11.179.643 | 11.179.643 | 117.058.858 | 117.366.468 |
| Increase (1) | 278 | - | 1.344.394 | 792.391 |
| Use (2) | 574 | - | 2.000.000 | 1.100.000 |
| 31st December | 11.179.347 | 11.179.643 | 116.403.253 | 117.058.858 |
(1) changes in the years 2015 and 2016 result from the increase in free reserves in the distribution of the result of the previous year and the dividends received. In addition, in 2016, there was an increase of EUR 626 in the sale of 100 own shares.
(2) amount for dividends paid.
Ibersol available reserves and retained earnings amounts to 131.370.831 euros. Own shares reserves held by Ibersol (11.179.347 euros) are unavailable for distribution.
On 31 December 2016 and 2015, balances recognised under this heading relate to loans granted to subsidiaries of Ibersol. These loans with repayment periods exceeding 1 year accrues interest at a fixed rate based on Euribor 12 m + 1,25% and changed as variation of ECB reference rate.
| 2016 | |||||
|---|---|---|---|---|---|
| Iberusa | Ibersol Restauração |
Asurebi SGPS |
Restmon | TOTAL | |
| Non-current | |||||
| Loans granted Subsidiaries |
4.357.500 | 91.515.996 | 69.530.000 | 1.276.000 | 166.679.496 |
| Accumulated impairment losses | - | - | - | - | - |
| Non-current total | 4.357.500 | 91.515.996 | 69.530.000 | 1.276.000 | 166.679.496 |
| 2015 | |||||
| Iberusa | Ibersol Restauração |
Asurebi SGPS |
Restmon | TOTAL | |
| Non-current | |||||
| Loans granted Subsidiaries |
1.707.500 | 85.515.996 | 1.276.000 | 88.499.496 | |
| Accumulated impairment losses | - | - | - | - | - |
| Non-current total | 1.707.500 | 85.515.996 | - | 1.276.000 | 88.499.496 |
Changes in this heading, are presented as follows:
| 2016 | 2015 | |
|---|---|---|
| Initial amount | 88.499.496 | 16.138.496 |
| Additions | 80.200.000 | 75.730.000 |
| Decreases | 2.020.000 | 3.369.000 |
| Final amount | 166.679.496 | 88.499.496 |
On 31 December 2016 and 2015, balances recognised under this heading relate to interest concerning loans granted to subsidiaries of Ibersol and subsidiaries current year income tax, as follows:
| 2016 | 2015 | |||
|---|---|---|---|---|
| Current asset | Current liabilities | Current asset | Current liabilities | |
| Income tax - RETGS | 4.705.419 | 179.272 | 2.275.063 | 173.941 |
| Interest loans | 2.579.824 | - | 1.723.461 | - |
| 7.285.243 | 179.272 | 3.998.524 | 173.941 |
By applying the special taxation for corporate groups (RETGS), the shareholder Ibersol - SGPS, SA will carry out income tax payments of its subsidiaries.
These balances are presented as follows (Note 27):
| 2016 | 2015 | |||
|---|---|---|---|---|
| Debit | Credit | Debit | Credit | |
| Ibersol Restauração | - | 82.461 | 106.276 | - |
| Iberusa | 1.267.731 | - | 368.569 | - |
| Asurebi | - | 74.723 | - | 162.192 |
| IBR Imobiliária | 154.948 | - | 153.545 | - |
| Ibersol Hotelaria e Turismo | 178.920 | - | 121.118 | - |
| Eggon | 1.718 | - | 3.843 | - |
| Iber King | 1.813.504 | - | 743.935 | - |
| Ibersol Madeira & Açores | 353.403 | - | 65.441 | - |
| Sugestões & Opções | 190.598 | - | 66.581 | - |
| Anatir | - | 631 | - | 1.306 |
| Ibergourmet | 127.233 | - | 123.218 | - |
| Iberaki | 101.326 | - | 20.249 | - |
| Ferro & Ferro | 41.318 | - | 4.462 | - |
| Firmoven | 11.604 | - | - | 10.443 |
| QRM | - | - | 22.948 | - |
| Resboavista | 30.762 | - | 69.919 | - |
| JSCC | 90.805 | - | 179.966 | - |
| SEC | 26.992 | - | 18.665 | - |
| Ibersande | 314.556 | - | 206.329 | |
| Gravos | - | 989 | ||
| Maestro | - | 20.469 | ||
| 4.705.419 | 179.272 | 2.275.063 | 173.941 |
Concerning interest loans, short term balances of the subsidiaries are presented as follows:
| 2016 | 2015 | |
|---|---|---|
| Ibersol Restauração | 2.039.708 | 1.437.875 |
| Iberusa | 37.335 | 29.071 |
| Restmon | 272.629 | 256.515 |
| Asurebi | 230.152 | - |
| 2.579.824 | 1.723.461 |
On 31 December 2016 and 2015, the detail of loans for the period (current and non-current) and by type of loan, is as follows:
| 2016 Non |
2015 Non |
|||||
|---|---|---|---|---|---|---|
| Current | Current | Total | Current | Current | Total | |
| Commercial paper | - | 78.000.000 | 78.000.000 | - | - | - |
| Bank overdrafts (1) | - | - | - | 35.000 | - | 35.000 |
| - | 78.000.000 | 78.000.000 | 35.000 | - | 35.000 |
(1) use of guarantees bank accounts.
For Commercial Paper Programs we consider reimbursement on the date of filing regardless of the terms for which they are contracted. Ibersol is a subscriber of a commercial paper program in the amount of 5.000.000 €, being used 5.000.000 € on 31 December 2016, with a date of denunciation of January 2017, meanwhile renewed. The remaining have longer maturities, up to 6 years.
The (undiscounted) future cash flows associated with the loans (commercial paper) at 31 December 2016 are detailed as follows:
| 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | |
|---|---|---|---|---|---|---|
| Commercial paper | - | 14.500.000 | 15.500.000 | 15.000.000 | 15.000.000 | 18.000.000 |
| Interest | 1.498.500 | 1.401.250 | 1.087.125 | 810.000 | 510.000 | 180.000 |
In 2016, the average cost of the loans 2,4%.
On 31 December 2016 and 2015, the detail of other current liabilities is as follows:
| 2016 | 2015 | |||
|---|---|---|---|---|
| Current | Total | Current | Total | |
| Investment suppliers | ||||
| Financial investments (1) | 20.181.420 | 20.181.420 | - | - |
| Other creditors | ||||
| Creditors | 12.546 | 12.546 | 3.918 | 3.918 |
| State and other public entities | ||||
| Income tax withholding | 6.625 | 6.625 | 6.519 | 6.519 |
| VAT payable | 126.674 | 126.674 | 126.121 | 126.121 |
| Social Security | 7.133 | 7.133 | 6.993 | 6.993 |
| Accrued costs | ||||
| Payable remunerations | 28.524 | 28.524 | 27.913 | 27.913 |
| Premiums | 74.876 | 74.876 | 60.000 | 60.000 |
| Payable interest | 49.222 | 49.222 | - | - |
| Fee | 99 | 99 | - | - |
| Other | 4.914 | 4.914 | 8.831 | 8.831 |
| Total accounts payable to | ||||
| creditors and accrued costs | 20.492.033 | 20.492.033 | 240.294 | 240.294 |
(1) Debt for the acquisition of 10% of the subsidiary Asurebi (note 6.1).
The movements in provisions for the year 2016 and 2015 are as follows:
| Legal proceedings | Income tax | |||
|---|---|---|---|---|
| 2016 | 2015 | 2016 | 2015 | |
| Initial amount | 5.257 | 5.257 | 289.545 | - |
| Additions (1) | - | - | 1.200.166 | 289.545 |
| Decreases | - | - | - | - |
| Final amount | 5.257 | 5.257 | 1.489.711 | 289.545 |
(1) A provision of 1.200.166 euros was recorded in 2016 and 289.545 euros in 2015 (Note 24), related to tax benefits arising from the IRC calculation for the years 2015 and 2014, respectively, in the confirmation phase of its implementation.
The amount of sales and services recognized in the income statement, is detailed as follows:
| 2016 | 2015 | |
|---|---|---|
| Rendered services - internal market | 600.000 | 600.000 |
| Rendered services - external market | - | - |
| Sub-total | 600.000 | 600.000 |
| Sales and rendered services | 600.000 | 600.000 |
External services and supplies in the years ending on 31 December 2016 and 2015 are broken down as follows:
| 2016 | 2015 | ||
|---|---|---|---|
| Services fees | 125.408 | 106.941 | |
| Fees | 1.433 | - | |
| Other | 18.072 | 2.485 | |
| External supplies and services | 144.913 | 109.426 |
Personnel cost in the years ending on 31 December 2016 and 2015 are broken down as follows:
| 2016 | 2015 | |
|---|---|---|
| Salaries and wages | ||
| Board od directors | 33.475 | 29.888 |
| Employees | 224.740 | 249.663 |
| 258.215 | 279.551 | |
| Social costs | ||
| Social security contributions | 73.102 | 44.174 |
| Other personnel costs | 6.227 | 5.618 |
| Sub-total | 79.329 | 49.792 |
| Personnel costs | 337.544 | 329.343 |
The average number of employees in 2016 was 3 (2015:3)
Heading other income and gains may be presented as follows:
| 2016 | 2015 | |
|---|---|---|
| Other income and gains | ||
| Others | 209 | 16.484 |
| 209 | 16.484 |
The detail of other operating costs is presented in the following table:
| 2016 | 2015 | |
|---|---|---|
| Other expenses and losses | ||
| Taxes | 53.932 | 9.405 |
| Banking services | 111.400 | 49.082 |
| Others | 188 | - |
| 165.520 | 58.487 |
Financial costs and income in the years ending on 31 December 2016 and 2015 are broken down as follows:
| 2016 | 2015 | |
|---|---|---|
| Financial costs | ||
| Interest on bank loans | 170.194 | 44 |
| Commercial paper commissions | 239.539 | 149.385 |
| Other commissions | - | 22.242 |
| Others | 26.498 | 20.739 |
| 436.231 | 192.410 | |
| 2016 | 2015 | |
| Financial income | ||
| Operation benefits | 600.000 | 432.100 |
| Interest subsidiaries debt | 1.367.010 | 180.534 |
| 1.967.010 | 612.634 |
Tax amount recognised in the financial statements of the years 2016 and 2015 is as follows:
| 2016 | 2015 | |
|---|---|---|
| Current income tax | 198.720 | 24.154 |
| Income tax insufficiency | -1.226.333 | -289.545 |
| Provisions | 1.200.166 | 289.545 |
| Special taxation - RETGS (Note 8) | - | 560.386 |
| Other effects | - | 178.571 |
| Deferred taxes | - | - |
| Income tax | 172.552 | 763.110 |
| 2016 | 2015 | |
| Current tax for the year | ||
| Tax base | 185.472 | 22.544 |
| Special tax (independent) | - | - |
| Pours | 13.248 | 1.610 |
| 198.720 | 24.154 |
Tax amount for the year reconciliation is as follows:
| 2016 | 2015 | |
|---|---|---|
| Pre-tax profit | 1.483.012 | 539.452 |
| Tax calculated at the applicable tax rate in Portugal (22,5%) |
333.678 | 121.377 |
| Non-deductible costs | 42 | - |
| Non-deductible income | -135.000 | -97.223 |
| Equity method effect | - | - |
| Special tax (independent) | - | - |
| Income tax expenses | 198.720 | 24.154 |
| Imposto s/ rendimento corrente | 198.720 | 24.154 |
| Imposto s/ rendimento diferido | - | - |
| Imposto s/ rendimento | 198.720 | 24.154 |
| Taxa efectiva de imposto | 13,40% | 4,48% |
To determine the amount of tax in the financial statements the tax rate is chosen as follows:
| 2016 | 2015 | |
|---|---|---|
| Tax base rate | 21,00% | 21,00% |
| Tax pours | 1,50% | 1,50% |
| 22,50% | 22,50% |
In accordance with the legislation in force, tax declarations of Ibersol are subject to review and can be corrected by the tax authorities for a period of four years in general terms, so that the declarations of 2013 to 2016 are still open.
Ibersol board of directors understands that the corrections resulting from reviews or inspections by the tax authorities will not have a significant effect on the financial statements presented on 31 December 2016.
Bail of 28.342 euros for the rental of a commercial shop of 231m2 took by the subsidiary Ibersol Restauração, S.A..
In addition, Ibersol SGPS provided guarantees to the subsidiaries in the amount of 2.750.000 USD.
The compensation granted to social board is related to fees for the annual review of the company's accounts, as follows:
| 2016 | 2015 | |
|---|---|---|
| Auditors | 35.500 | 41.583 |
| Fiscal board | 26.358 | 26.358 |
| General Assembly | 2.335 | 2.335 |
| Board of Directors (1) | 6.000 | 6.000 |
| 70.193 | 76.276 |
(1) earnings of non-Executive Director.
Remuneration and benefits assigned to directors:
The company shareholder ATPS-S.G.P.S., S.A., which signed a service-rendering contract with the subsidiary Ibersol Restauração, SA for 2016, in the amount of 800.000 euros (800.000 euros in 2015), provided services of administration and management to the group. ATPS-S.G.P.S., S.A. under contract with Ibersol Restauração, S.A. has the obligation to ensure that its administrators, António Carlos Vaz Pinto de Sousa and Antonio Alberto Guerra Leal Teixeira, exercise their positions without incur in any additional charge.
On 31 December 2016, Ibersol is controlled by ATPS, SGPS, S.A. that holds a direct participation of 54,91%.
(a) Nature of relationship with related parties:
Shareholders:
ATPS – SGPS, S.A.
Ibersande Restauração, S.A. Iberusa – Hotelaria e Restauração, S.A. Ibersol Madeira e Açores Restauração, S.A. Ibersol Restauração, S.A. Iberking Restauração, S.A. Iberaki Restauração, S.A. Restmon Portugal, Lda. Ibersol – Hotelaria e Turismo, S.A. Vidisco, S.L. Inverpeninsular, S.L. Ibergourmet Produtos Alimentares, S.A. Ferro & Ferro, Lda. Asurebi SGPS, S.A. Charlotte Develops, S.L. Firmoven Restauração, S.A. I.B.R. - Sociedade Imobiliária, S.A. Eggon SGPS, S.A. Anatir SGPS, S.A. Lurca, S.A. Sugestões e Opções – Actividades Turísticas, S.A. Resboavista – Restauração Internacional, Lda. José Silva Carvalho Catering, S.A. Iberusa Central de Compras para Restauração, ACE Vidisco e Pasta Caffe, Union Temporal de Empresas Maestro – Serviços de Gestão Hoteleira, S.A. Solinca – Eventos e Catering, S.A. Ibersol – Angola, S.A. HCI – Imobiliária, S.A. Gravos 2012, S.A. Lusinver Restauración, S.A. The Eat Out Group S.L.U. Pansfood, S.A.U. Foodstation, S.L.U. Dehesa de Santa Maria Franquicias, S.L. Pansfood Itália, S.R.L. Joint undertakings with Ibersol, SGPS:
UQ Consult, S.A.
In the year endied on 31 December 2016 Ibersol carried out transactions with shareholders as follows:
| 2016 | 2015 | |
|---|---|---|
| ATPS SGPS, S.A. | 1.701 | - |
| 1.701 | - |
In the years ending on 31 December 2016 and 2015 Ibersol carried out transactions with subsidiaries as follows:
| 2015 | |
|---|---|
| 600.000 | 600.000 |
| 600.000 | 600.000 |
| 2016 | 2015 |
| 230.152 | - |
| 1.081.708 | 134.875 |
| 29.071 | |
| 16.588 | |
| 1.365.309 | 180.534 |
| 182.100 | |
| 250.000 | |
| 600.000 | 432.100 |
| 2016 | 2015 |
| 10.803 | 10.707 |
| 10.803 | 10.707 |
| 2016 37.335 16.114 600.000 - |
In the years ending on 31 December 2016 and 2015, the balances resulting from transactions with related parties are as follows:
| 2016 | 2015 | |
|---|---|---|
| Debit balances | ||
| Asurebi | 230.152 | - |
| Eggon | 1.718 | 3.843 |
| Ferro | 41.318 | 4.462 |
| Firmoven | 11.604 | - |
| Iber King | 1.813.504 | 743.935 |
| Iberaki | 101.326 | 20.249 |
| Ibergourmet | 127.233 | 123.218 |
| Ibersande | 314.556 | 206.329 |
| Ibersol Madeira e Açores | 353.403 | 65.441 |
| Ibersol Restauração | 2.039.708 | 1.544.151 |
| Iberusa | 1.305.066 | 397.640 |
| IBR | 154.948 | 153.545 |
| IHT | 178.920 | 121.118 |
| José Silva Carvalho | 90.805 | 179.966 |
| QRM | - | 22.948 |
| Resboavista | 30.762 | 69.919 |
| Restmon | 272.629 | 256.515 |
| SEC | 26.992 | 18.665 |
| Sugestões | 190.598 | 66.581 |
| 7.285.242 | 3.998.524 | |
| Loans | ||
| Prestações acessórias (Nota 6) | 81.594.783 | 85.064.783 |
| Subsidiárias (Nota 14) | 166.679.496 | 88.499.496 |
| 248.274.279 | 173.564.279 | |
| 2016 | 2015 | |
| Credit balances | ||
| Anatir | 631 | 1.306 |
| Asurebi | 74.723 | 162.192 |
| Firmoven | - | 10.443 |
| Gravos | 989 | - |
| Ibersol Restauração | 20.267.271 | 4.666 |
| Maestro | 20.469 | |
| 20.364.083 | 178.607 |
Income per share in the years ending on 31 December 2016 and 2015 was calculated as follows:
| Dec-16 | Dec-15 | |
|---|---|---|
| Profit payable to shareholders | 1.310.460 | -223.658 |
| Mean weighted number of ordinary shares issued | 22.098.361 | 20.000.000 |
| Mean weighted number of own shares | -2.055.703 | -2.000.000 |
| 20.042.658 | 18.000.000 | |
| Basic earnings per share (€ per share) | 0,07 | -0,01 |
| Number of own shares at the end of the year | 2.399.905 | 2.000.000 |
There are no subsequent events to 31 December 2016 that may have a material impact on the financial statements presented.
The Board of Directors,
______________________________ António Alberto Guerra Leal Teixeira
______________________________ António Carlos Vaz Pinto de Sousa
______________________________ Juan Carlos Vázquez-Dodero
We have audited the financial statements of Ibersol, S.G.P.S., S.A. (the Entity), which comprise the statement of financial position as at 31 December 2016 (which shows total assets of Euro 279,875,805 and total shareholders' equity of Euro 177,501,185 including a net profit of Euro 1,310,460), the statement of comprehensive income, the statement of changes in equity and the statement of cash flows for the year then ended, and the notes to the financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying financial statements present fairly in all material respects, the financial position of Ibersol, S.G.P.S., S.A. as at 31 December 2016, and its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards (IFRS), as adopted by the European Union.
We conducted our audit in accordance with International Standards on Auditing (ISAs) and other technical and ethical standards and recommendations issued by the Institute of Statutory Auditors. Our responsibilities under those standards are described in the "Auditor's responsibilities for the audit of the financial statements" section below. In accordance with the law we are independent of the Entity and we have fulfilled our other ethical responsibilities in accordance with the ethics code of the Institute of Statutory Auditors.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the current year. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. We have determined the matters described below to be the key audit matters to be communicated in our report.
PricewaterhouseCoopers & Associados - Sociedade de Revisores Oficiais de Contas, Lda. o′Porto Bessa Leite Complex, Rua António Bessa Leite, 1430 - 5º, 4150-074 Porto, Portugal Tel +351 225 433 000 Fax +351 225 433 499, www.pwc.pt Matriculada na CRC sob o NUPC 506 628 752, Capital Social Euros 314.000 Inscrita na lista das Sociedades de Revisores Oficiais de Contas sob o nº 183 e na CMVM sob o nº 20161485
PricewaterhouseCoopers & Associados - Sociedade de Revisores Oficiais de Contas, Lda. pertence à rede de entidades que são membros da PricewaterhouseCoopers International Limited, cada uma das quais é uma entidade legal autónoma e independente. Sede: Palácio Sottomayor, Rua Sousa Martins, 1 - 3º, 1069-316 Lisboa, Portugal
Management is responsible for:
a) the preparation of the financial statements, which present fairly the financial position, the financial performance and the cash flows of the Entity in accordance with International Financial Reporting Standards (IFRS), as adopted by the European Union;
b) the preparation of the Directors' Report , including the Corporate governance Report, in accordance with the applicable law and regulations;
c) the creation and maintenance of an appropriate system of internal control to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error;
d) the adoption of appropriate accounting policies and criteria;
e) the assessment of the Entity's ability to continue as a going concern, disclosing, as applicable, events or conditions that may cast significant doubt on the Entity's ability to continue its activities.
The supervisory board is responsible for overseeing the process of preparation and disclosure of the Entity's financial information.
Our responsibility is to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:
a) identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control;
b) obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Entity's internal control;
c) evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management;
d) conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Entity to cease to continue as a going concern;
e) evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation;
f) communicate with those charged with governance, including the supervisory board, regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit;
g) of the matters we have communicated to those charged with governance, including the supervisory board, we determine which one's were the most important in the audit of the financial statements of the current year, these being the key audit matters. We describe these matters in our report, except when the law or regulation prohibits their public disclosure;
h) confirm to the supervisory board that we comply with the relevant ethical requirements regarding independence and communicate all relationships and other matters that may be perceived as threats to our independence and, where applicable, the respective safeguards.
Our responsibility also includes verifying that the information included in the Directors' report is consistent with the financial statements and the verification set forth in paragraphs 4 and 5 of article No. 451 of the Portuguese Company Law.
In compliance with paragraph 3 e) of article No. 451 of the Portuguese Company Law, it is our understanding that the Director's report has been prepared in accordance with applicable requirements of the law and regulation, that the information included in the Directors' report is consistent with the audited financial statements and, taking into account the knowledge and assessment about the Entity, no material misstatements were identified.
In compliance with paragraph 4 of article No. 451 of the Portuguese Company Law, it is our understanding that the Corporate governance report includes the information required under article No. 245-A of the Portuguese Securities Market Code, that no material misstatements were identified in the information disclosed in this report and that it complies with paragraphs c), d), f), h), i) and m) of that article.
In accordance with article No. 10 of Regulation (EU) 537/2014 of the European Parliament and of the Council, of April 16, 2014, and in addition to the key audit matters referred to above, we also provide the following information:
a) We were first appointed auditors of the Entity in the Shareholders' General Meeting of 13 April 2004 till the end of the period 2001 to 2004, having remained in functions until the current period. Our last appointment was in the Shareholders' General Meeting of 6 May 2013 for the period from 2013 to 2016.
b) The management has confirmed to us it has no knowledge of any allegation of fraud or suspicions of fraud with material effect in the financial statements. We have maintained professional scepticism throughout the audit and determined overall responses to address the risk of material misstatement due to fraud in the financial statements. Based on the work performed, we have not identified any material misstatement in the financial statements due to fraud.
c) We confirm that our audit opinion is consistent with the additional report that was prepared by us and issued to the Entity's supervisory board as of 28 April 2017.
d) We declare that we did not provide any prohibited non-audit services referred to in paragraph 8 of article No. 77 of the by-laws of the Institute of Statutory Auditors ("Estatutos da Ordem dos Revisores Oficiais de Contas") and that we remain independent of the Entity in conducting our audit.
28 April 2017
PricewaterhouseCoopers & Associados - Sociedade de Revisores Oficiais de Contas, Lda. represented by:
Hermínio António Paulos Afonso, R.O.C.
In accordance with paragraph c) number 1 of article 245 of the Portuguese Securities Market Code the Fiscal Board informs as far as its members know and regarding the elements we assessed, the information contained in the individual and consolidated financial statements of 2016 was prepared in accordance with applicable accounting standards, giving a true and appropriate view of the assets and liabilities, financial position and the results of IBERSOL-SGPS, SA, and the companies included in the consolidation perimeter, and that the management reports faithfully describes the business evolution, performance and financial position of the company and of the companies included in the consolidation perimeter, and contains a description of the major risks and uncertainties they face.
Porto, 28th April 2017
The Fiscal Board
(Dr. Joaquim Alexandre de Oliveira Silva)
(Dr. António Maria de Borda Cardoso)
(Dr. Eduardo Moutinho Ferreira Santos)
In compliance with the applicable legislation and its mandate, the Fiscal Board issues its report on the supervisory action carried out as well as its opinion, on the Management Report and consolidated and individual financial statements for the year ended 31 December 2016.
The Fiscal Board accompanied, within the scope of its competencies and mandate, the management of the company and its subsidiaries, having received for that purpose the information of the Company's Board of Directors, the Statutory and External Auditor.
During the year 2016, the Fiscal Council held its quarterly ordinary meetings, as well as other extraordinary meetings, with all members present, which examined and considered the matters subject to the powers of this body.
In the ordinary meetings was always present the Statutory and External Auditor, Pricewaterhouse Coopers & Associados-SROC, who informed and obtained agreement from the Fiscal Board regarding its fiscal activity plan, including that meant to ascertain: - the effectiveness of the risk management system, internal control and internal auditing; - the quality of the process of preparing and disclosing financial information and respective accounting policies and value; measuring criteria, the regularity of the accounting registers and books and respective support documents, and - the verification of goods and values pertaining to the company. During the exercise, the Statutory and External Auditor provided detailed information about the actions performed and the resulting conclusions.
The Fiscal Board meet quarterly with the Board of Directors and this last organ was forthcoming in providing the Fiscal Board information over the society's activity and explanations needed to understand the activity and financial
1
information drawn up by same Board of Directors in previous moment to it's disclosure.
The Fiscal Board did not register any constraints in the exercise of its activity, and did not receive any participation in the occurrence or denouncement of any irregularities by shareholders, employees of the company, Statutory and External Auditor or other.
The Fiscal Board exercised its powers to supervise the activities and independence of the Statutory and External Auditor, having the perception that the recommended practices were observed.
The Fiscal Board has rendered it's approval to additional services to the auditory services that were hired to the External Auditor, having considered that it's independence was safeguarded, it's remuneration was contained in market conditions, and, therefore, it was in the society's interest to benefit of the knowledge and punctuality assured in those services. The provision of additional services performed by the external auditor did not reach the threshold of 30% of the total value of provided Services.
There were no reports to the Fiscal Board of any kind of transactions between the society and it's shareholders or related parties, in the sense of the CMVM Recommendation IV.1.2, that should be submitted to it's prior opinion if they reached the level of significance established by this body.
The Fiscal Board examined the individual and consolidated Management Report and the individual and consolidated Financial Statements and respective annexure, including the 2016 Corporate Governance Report presented by the Board of Directors, having examined, as well, the Statutory Audit Certification and Audit Report issued by the Statutory and External Auditor, Pricewaterhouse Coopers & Associados, SROC, annexes to the "Additional Report of the Statutory Auditor to the Supervisory Body", produced by it and referring to the 2016 exercise, under Art. 24 of the RJSA, approved by Law 148/2015, of September 7. It includes the scope of the Audit, the partners and employees of the SROC who participated in it, the evaluation methods used with reference to impairment tests and corporate concentrations, the consolidation perimeter with mention of entities not audited by PwC, materiality, independence and the additional services provided, as well as, among others, the results of the Internal Control that answers the questions raised, the answers obtained and the recommendations made.
The Fiscal Board, pursuant to paragraph 5 of article 420 of the Companies Code, appreciated the Corporate Governance Report and certified the inclusion in the information referred to in article 245-A of the Portuguese Securities Code.
Considering the above, the opinion of the Fiscal Board is that are fulfilled the conditions of the approval, by the General Meeting, of :
Porto, 28th April 2017
The Fiscal Board
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