Quarterly Report • Jul 31, 2015
Quarterly Report
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IINFO
| ${\bf \textbf{CORPORTE}~INFORMATION} \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots$ | |
|---|---|
| CORPORATE BODIES | |
| ORGANIZATIONAL CHART AS OF JUNE 30, 2015 | |
| GROUP STRUCTURE | |
| HALF-YEAR DIRECTORS' REPORT |
| $\label{eq:final} \textbf{Financial Results Analysis} \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots \dots$ | |
|---|---|
| Significant events occured during the first six months of 2015 | |
| Significant events occured after June 30, 2015 | |
| Outlook | |
| Related parties transactions | |
| Atypical and/or unusual transactions | |
| Treasury shares |
| HALF-YEAR CONDENSED CONSOLIDATED FINANCIAL STATEMENTS | |
|---|---|
| Consolidated Income Statement | |
| Consolidated Statement of Comprehensive Income | |
| Consolidated Statement of Financial Position | |
| Consolidated Statement of Changes in Equity | |
| Consolidated statement of Cash Flows | |
| NOTES TO THE HALF-YEAR CONDENSED CONSOLIDATED FINANCIAL | |
| STATEMENTS AS OF JUNE 30, 2015 |
| ATTESTATION PURSUANT TO PARAGRAPH 2, ART. 154 BIS OF | |
|---|---|
| LEGISLATIVE DECREE 58/98 | |
| AUDITORS' REPORT ON REVIEW OF HALF-YEAR CONDENSED CONSOLIDATED | |
| FINANCIAL STATEMENTS |
Moncler S.p.A. Via Enrico Stendhal, 47 20144 Milan - Italy
Via Venezia, 1 35010 Trebaseleghe (Padua) - Italy Phone: +39 049 9323111 Fax: +39 049 9323339
Authorized and issued share capital Euro 50.024.042 VAT, Tax Code and Chamber of Commerce enrollment No.: 04642290961 Iscr. R.E.A. Milan No. 1763158
Milan, Via Solari, 33 Milan, Via Stendhal, 47 Paris, Rue du Faubourg St. Honoré, 7 New York, 568 Broadway suite 306 Tokyo, 5-4-46 Minami-Aoyama Omotesando Minato-Ku Munich, Infanteriestrasse, 11 A
Remo Ruffini Virginie Sarah Sandrine Morgon(2) Nerio Alessandri $^{\textrm{\tiny{(1)}}\,\textrm{\tiny{(2)}}\,\textrm{\tiny{(3)}}}$ Vivianne Akriche(3) Alessandro Benetton $^{\text{\tiny{(1)}}}$ Christian Gerard Blanckaert Sergio Buongiovanni Marco Diego De Benedetti $^{\scriptscriptstyle{(2)\,(3)}}$ Gabriele Galateri di Genola $^{\textrm{\tiny{(1)}}\,\textrm{\tiny{(2)}}\,\textrm{\tiny{(3)}}\,\textrm{\tiny{(4)}}}$ Diva Moriani $^{\left(1\right)\,\left(2\right)\,\left(3\right)}$ Pier Francesco Saviotti
Mario Valenti Antonella Suffriti Raoul Francesco Vitulo Lorenzo Mauro Banfi Stefania Bettoni
KPMG S.p.A.
Chairman Regular Auditor Regular Auditor Alternate Auditor Alternate Auditor
| Moncler S.p.A. | 51% Moncler Lunettes S.r.l. |
||||
|---|---|---|---|---|---|
| 100% Industries S.p.A. |
5% | ||||
| Moncler Shanghai Commercial Co Ltd |
100% | 100% | Moncler USA Inc | 95% | Moncler Brasil Comércio de moda e acessòrios Ltda. |
| Moncler Asia Pacific Ltd |
99,99% | 100% | Moncler France S.à.r.l. | 100% | Moncler USA Retail LLC |
| Moncler Japan Corporation |
51% | 100% | Industries Textilvertrieb GmbH |
51% | Moncler Sylt GmbH |
| Moncler UK Ltd | 100% | 100% | Moncler Belgium S.p.r.l. |
||
| Moncler Denmark ApS | 100% | 100% | Moncler Holland B.V. | ||
| Moncler Hungary KFT | 100% | 50,1% | Moncler Enfant S.r.l. | ||
| Moncler CZ S.r.o. | 100% | 100% | Moncler España SL | ||
| Pepper Grenoble $S.\grave{a}.\dot{r}.\dot{L}$ |
100% | 100% | Moncler Suisse SA | 51% | Ciolina Moncler AG |
| Moncler Istanbul Giyim ve Tekstil Ticaret Ltd. Sti. |
51% | 99,99% | 0,01% Moncler Rus LLC |
||
| Moncler Taiwan Limited |
100% | 100% | Moncler Canada Ltd | ||
| Moncler Prague s.r.o. | 100% | 70% | White Tech S.p.zo.o | ||
| Moncler Shinsegae Inc. |
51% | 100% | Moncler Middle East FZ-LLC. |
The Half-year Financial Report as of June 30, 2015 includes Moncler S.p.A. (Parent Company), Industries S.p.A. and 29 consolidated subsidiaries in which the Parent Company holds, directly or indirectly, a majority of the voting rights, or over which it exercises control from which it is able to derive benefits by virtue of its power to govern both on a financial and an operating aspects.
| Moncler S.p.A. | Parent company which holds the Moncler brand |
|---|---|
| Industries S.p.A. | Sub-holding company, directly involved in the management of foreign companies and distribution channels (DOS, Showroom) in Italy and licensee of the Moncler brand |
| Industries Textilvertrieb GmbH | Company that manages DOS and promotes goods in Germany and Austria |
| Moncler Belgium S.p.r.l. | Company that manages DOS in Belgium |
| Moncler Denmark ApS | Company that manages DOS in Denmark |
| Moncler España SL | Company that manages DOS in Spain |
| Moncler France S.à.r.l. | Company that manages DOS and promotes goods in France |
| Moncler Istanbul Giyim ve Tekstil Ticaret Ltd. Sti. |
Company that manages DOS in Turkey |
| Moncler Holland B.V. | Company that manages DOS in the Netherlands |
| Moncler Hungary KFT | Company that manages DOS in Hungary |
| Moncler Prague s.r.o. | Company that manages DOS in the Czech Republic |
| Moncler Rus LLC | Company that manages DOS in Russia |
| Moncler Suisse SA | Company that manages DOS in Switzerland |
| Ciolina Moncler AG | Company that manages DOS in Switzerland |
| Moncler Sylt Gmbh | Company that manages DOS in Sylt |
| Moncler UK Ltd | Company that manages DOS in the United Kingdom |
| Moncler Brasil Comércio de moda e acessòrios Ltda. |
Company that manages DOS in Brazil |
| Moncler Canada Ltd | Company that manages DOS in Canada |
| Moncler USA Inc | Company promotes and distributes goods in North America |
| Moncler USA Retail LLC | Company that manages DOS in North America |
| Moncler Asia Pacific Ltd | Company that manages DOS in Hong Kong and will manage DOS in Macau |
| Moncler Japan Corporation | Company that manages DOS and distributes and promotes goods in Japan |
| Moncler Shanghai Commercial Co. Ltd |
Company that manages DOS in China |
HALF-YEAR FINANCIAL REPORT AS OF JUNE 30, $2015$ – $\rm MONCLER$
| Moncler Shinsegae Inc. | Company that manages DOS and distributes and promotes goods in Korea |
|---|---|
| Moncler Taiwan Limited | Company that manages DOS in Taiwan |
| Moncler Enfant S.r.l. | Company that distributed and promoted goods from the Moncler Baby and Junior brand |
| Moncler Lunettes S.r.l. | Company responsible for coordinating the production and marketing of products in the Moncler eyewear brand |
| White Tech Sp.zo.o. | Company that manages quality control of down |
| ISC S.p.A. | Company that managed the Other Brands Business, disposed of on November 8, 2013 |
| Moncler CZ S.r.o. | Not operating company |
| Pepper Grenoble S.à.r.l. | Inactive company |
| Moncler Middle East FZ-LCC. | Not operating company |
Financial Results Analysis Significant events occured during the first six months of 2015 Significant events occured after June 30, 2015 Outlook Related parties transactions Atypical and/or unusual transactions Treasury shares
HALF-YEAR FINANCIAL REPORT AS OF JUNE 30, 2015 - MONCLER
Following are the consolidated income statements for the first half of Fiscal Year 2015 and 2014.
| Consolidated income statement | ||||
|---|---|---|---|---|
| (Euro/000) | First Half 2015 % on Revenues | First Half 2014 % on Revenues | ||
| Revenues | 295,789 | 100.0% | 218,299 | 100.0% |
| YoY growth | $+35%$ | $+19%$ | ||
| Cost of sales | (80, 783) | (27.3%) | (63, 296) | $(29.0\%)$ |
| Gross margin | 215,006 | 72.7% | 155,003 | 71.0% |
| Selling expenses | (102, 489) | $(34.6\%)$ | (71, 504) | (32.8%) |
| General & Administrative expenses | (37, 920) | $(12.8\%)$ | (31, 258) | $(14.3\%)$ |
| Advertising & Promotion | (20, 835) | $(7.0\%)$ | (17, 157) | $(7.9\%)$ |
| EBIT Adjusted | 53,762 | 18.2% | 35,084 | 16.1% |
| YoY growth | $+53%$ | $+29%$ | ||
| Non-recurring items $(1)$ | (5, 819) | $(2.0\%)$ | (1,791) | (0.8%) |
| EBIT | 47,943 | 16.2% | 33,293 | 15.3% |
| YoY growth | $+44%$ | $+23%$ | ||
| Net financial result $(2)$ | 3,146 | 1.1% | (5,074) | $(2.4\%)$ |
| EBT | 51,089 | 17.3% | 28,219 | 12.9% |
| Taxes | (16, 946) | $(5.7\%)$ | (10, 165) | $(4.6\%)$ |
| Tax Rate | 33.2% | 36.0% | ||
| Consolidated Net Income | 34,143 | 11.5% | 18,054 | 8.3% |
| Minority result | (103) | $(0.0\%)$ | 24 | $0.0\%$ |
| Net Income | 34,040 | 11.5% | 18,078 | 8.3% |
| YoY growth | $+88%$ | $+117%$ | ||
| EBITDA Adjusted | 70,920 | 24.0% | 46,407 | 21.3% |
| YoY growth | $+53%$ | $+29%$ |
EBITDA is not a recognized measure of financial performance under IFRS, but it is a measure commonly used by both management and investors when evaluating the operating performance of the Group. EBITDA is defined as EBIT (Operating income) plus depreciation and amortization.
FX Gain/(Losses) Euro 5,925 thousand;
$C_1$ $C_2$ $C_3$ $C_4$ $C_5$ $C_6$ $C_7$ $C_8$ $C_9$ $2$ First half 2015:
| Other financial items Euro $(2,779)$ thousand | |
|---|---|
| First half 2014: | FX Gain/(Losses) Euro 459 thousand: |
Other financial items Euro (5,533) thousand.
$1$ Non-recurring items mainly include non-monetary costs related to stock option plans and the effect of a revised valuation on receivables related to the "Other Brands Division" sale.
In the first half of fiscal year 2015, Moncler recorded revenues of Euro 295.8 million, an increase of 35% at current exchange rates compared to revenues of Euro 218.3 million in the same period of 2014 and an increase of 26% at constant exchange rates.
| Revenues by Region | ||||||
|---|---|---|---|---|---|---|
| (Euro/000) | First Half 2015 | % | First Half 2014 | % | YoY arowth reported |
YoY growth constant currencies |
| Italy | 51,442 | 17.4% | 47,513 | 21.8% | $+8%$ | $+8%$ |
| EMEA (excl. Italy) | 98,896 | 33.4% | 82,571 | 37.8% | $+20%$ | $+18%$ |
| Asia & Rest of the World | 102.722 | 34.7% | 66.635 | 30.5% | $+54%$ | $+36%$ |
| Americas | 42.729 | 14.5% | 21.580 | 9.9% | $+98%$ | $+69%$ |
| Total Revenues | 295,789 | 100.0% | 218,299 | 100.0% | $+35%$ | $+26%$ |
In the first half of fiscal year 2015, Moncler recorded positive performances in all its markets.
In the Americas, the company achieved 69% growth at constant exchange rates and 98% growth at current exchange rates, driven by the performances of both the retail and wholesale channels in North America (United States and Canada).
In Asia & Rest of the World, Moncler recorded significant growth rates (+36% at constant exchange rates, +54% at current exchange rates), mainly driven by the performance achieved in the retail channel in Greater China and Japan.
The EMEA countries recorded revenue growth of 18% at constant exchange rates and 20% at current exchange rates, with notable results from France, the United Kingdom and Germany.
In Italy, revenues rose by 8% compared to first half of 2014, driven by the retail channel and supported by a solid wholesale network.
| Revenues by Distribution Channel | |||||||
|---|---|---|---|---|---|---|---|
| (Euro/000) | First Half 2015 | $\%$ | First Half 2014 | % | reported | YoY growth YoY growth constant currencies |
|
| Retail | 201,358 | 68.1% | 121,873 | 55.8% | $+65%$ | $+51%$ | |
| Wholesale | 94.431 | 31.9% | 96.426 | 44.2% | $-2\%$ | -5% | |
| Total Revenues | 295,789 | 100.0% | 218,299 | 100.0% | $+35%$ | $+26%$ |
In the first six months of 2015, revenues from the retail distribution channel were Euro 201.4 million compared to Euro 121.9 million in the same period of 2014, representing an increase of 51% at constant exchange rates and 65% at current exchange rates. This performance was due to solid organic growth and the continued development of our network of mono-brand retail stores (Directly Operated Stores, DOS).
The Group achieved Comparable Store Sales Growth3 of 22% in the first half of 2015, reflecting outstanding results in January and February and the solid performance of the Spring/Summer collections.
The wholesale channel recorded revenues of Euro 94.4 million compared to Euro 96.4 million in first half of 2014, down 5% at constant exchange rates and 2% at current exchange rates. This result has been influenced by the newly established Korean joint venture. Moncler Shinsegae. Starting from January 1st, 2015 the Korean business (12 monobrand stores) has been converted from wholesale to retail making the performance of this channel not comparable. Excluding Korea, wholesale grew 3% at constant exchange rates, due to an excellent performance in the United States and despite the reduction of some doors mainly in Italy and Europe.
As at 30 June 2015, Moncler's mono-brand distribution network totalled 153 directly operated stores, an increase of 19 units compared to 31 December 2014; and 31 wholesale mono-brand stores (Shop-in-Shops), a decrease of 7 units compared to 31 December 2014.
Following the establishment of the joint venture in Korea, Moncler converted all of its 12 wholesale mono-brand stores in the country into Directly Operated Stores as of 1 January 2015.
| 30/06/2015 | 31/12/2014 | Net Openings | |
|---|---|---|---|
| and a | First half 2015 | ||
| Retail | 153 | 134 | $+19$ |
| Italy | 19 | 19 | |
| EMEA (escl. Italy) | 51 | 51 | |
| Asia & ROW | 69 | 50 | $+19$ |
| Americas | 14 | 14 | |
| Wholesale | 31 | 38 | $-7$ |
| Total | 184 | 172 | $+12$ |
<sup>3 Comparable Store Sales Growth is based on sales growth in DOS (excluding outlets) which have been opened for at least 52 weeks and in the online store; stores that have been extended and/or relocated are excluded from the calculation.
In the first half of 2015, the consolidated gross margin was Euro 215.0 million, equivalent to 72.7% of revenues compared to 71.0% in the same period of 2014. This improvement was mainly attributable to the growth in the retail channel.
Selling expenses of Euro 102.5 million, were equivalent to 34.6% of revenues compared to 32.8% in the same period in 2014; this increase was primarily due to expansion of the retail channel. General and administrative expenses were Euro 37.9 million, equivalent to 12.8% of revenues compared to 14.3% in the first half of 2014. Advertising expenses were Euro 20.8 million, representing 7.0% of revenues compared to 7.9% in the first half of 2014.
Adjusted EBITDA4 rose to Euro 70.9 million, compared to Euro 46.4 million in the first six months of 2014, resulting in an EBITDA margin of 24.0% compared to 21.3% in the first half of 2014.
Adjusted EBIT4 was Euro 53.8 million, compared to Euro 35.1 million in the first half of 2014, resulting in an EBIT margin of 18.2% (16.1% in the first half of 2014). Including non-recurring costs, EBIT was Euro 47.9 million, representing an EBIT margin of 16.2% compared to 15.3% in the first half of 2014.
Non-recurring costs include non-cash costs related to the Moncler stock option plans equal to Euro 2.8 million (Euro 1.8 million in first half of 2014) and the effect of a revised valuation of receivables related to the sale of the "Other Brands Division", equal to Euro 3 million, which has been cautiously posted in the financial report, being the outcome of the procedure for the determination of the selling price still uncertain.
Net Income increased by 88% to Euro 34.0 million, equivalent to 11.5% of revenues, compared to Euro 18.1 million in the same period of 2014.
As already highlighted in the comments to the consolidated revenues, part of Moncler's growth in the first half of 2015 is due to the appreciation of some important currencies in which the Group operates. Given that a significant portion of cost is euro denominated, the improvement in profits and margins are partially due also to the fluctuation of non-euro currencies.
<sup>4 Before non-recurring costs: non-cash costs related to stock option plans (equal to Euro 2.8 million in the first half of 2015 and Euro 1.8 million in the first half of 2014) and the effect of a revised valuation on receivables related to the "Other Brands Division" sale.
Following is the reclassified consolidated statement of financial position as of June 30, 2015, December 31, 2014 and June 30, 2014.
| Reclassified consolidated statement of financial position | |||
|---|---|---|---|
| (Euro/000) | 30/06/2015 | 31/12/2014 | 30/06/2014 |
| Intangible Assets | 414,040 | 414,353 | 414,061 |
| Tangible Assets | 86,327 | 77,254 | 65,950 |
| Other Non-current Assets/(Liabilities) | 7,664 | (14, 706) | (23, 848) |
| Total Non-current Assets | 508,031 | 476,901 | 456,163 |
| Net Working Capital | 91,763 | 97,091 | 36,311 |
| Other Current Assets/(Liabilities) | (244) | (34, 041) | 27,424 |
| Total Current Assets | 91,519 | 63,050 | 63,735 |
| Invested Capital | 599,550 | 539,951 | 519,898 |
| Net Debt | 175,347 | 111,155 | 206,348 |
| Pension and Other Provisions | 8,382 | 8,222 | 9,247 |
| Shareholders' Equity | 415,821 | 420,574 | 304,303 |
| Total Sources | 599,550 | 539,951 | 519,898 |
Net Working Capital was Euro 91.8 million, compared to Euro 97.1 million at 31 December 2014 and Euro 36.3 million at 30 June 2014, equivalent to 12% of Last-Twelve-Months revenues and 11% at constant exchange rates. The increase in working capital is mainly related to the expansion of the retail channel.
| Net working capital | |||||
|---|---|---|---|---|---|
| (Euro/000) | 30/06/2015 | 31/12/2014 | 30/06/2014 | ||
| Accounts receivable | 59,355 | 86,593 | 36,951 | ||
| Inventory | 175,167 | 122,821 | 143,192 | ||
| Accounts payable | (142, 759) | (112, 323) | (143, 832) | ||
| Net working capital | 91,763 | 97,091 | 36,311 | ||
| % on Last Twelve Months Revenues | 12% | 14% | 6% |
Net Financial Debt at 30 June 2015 was Euro 175.3 million compared to Euro 111.2 million at 31 December 2014, and Euro 206.3 million at 30 June 2014. Net Financial Debt at 30 June 2015 is not perfectly comparable with the same period of 2014 due to the timing of tax payments. In 2015, Moncler paid Euro 47 million of taxes in June, while in 2014 the payments occurred in 5 instalments starting from July.
| Net financial debt | |||
|---|---|---|---|
| (Euro/000) | 30/06/2015 | 31/12/2014 | 30/06/2014 |
| Cash and cash equivalents | (102, 110) | (123, 419) | (87, 023) |
| Long-term borrowings | 150,920 | 154,243 | 158,876 |
| Short-term borrowings | 126,537 | 80,331 | 134,495 |
| Net financial debt | 175,347 | 111,155 | 206,348 |
Following is the reclassified consolidated statement of cash flow for first half 2015 and 2014:
| Reclassified consolidated statement of cash flow | ||
|---|---|---|
| (Euro/000) | First Half 2015 | First Half 2014 |
| EBITDA Adjusted | 70,920 | 46,407 |
| Change in NWC | 5,328 | 10,605 |
| Change in other curr./non-curr. assets/(liabilities) | (56,007) | (26, 169) |
| Capex, net | (21, 574) | (24, 366) |
| Operating Cash Flow | (1, 333) | 6,477 |
| Net financial result | 3,146 | (5,074) |
| Taxes | (16, 946) | (10, 165) |
| Free Cash Flow | (15, 133) | (8, 762) |
| Dividends paid | (30, 403) | (27, 634) |
| Changes in equity and other changes | (18, 656) | 1,108 |
| Net Cash Flow | (64, 192) | (35, 288) |
| Net Financial Debt - Beginning of the Period Net Financial Debt - End of the Period |
111,155 175,347 |
171,060 206,348 |
| Change in Net Financial Debt | (64, 192) | (35, 288) |
Free Cash Flow in the first half of 2015, including the net capex made in the period, was negative at Euro 15.1 million compared to Euro 8.7 million in the same period of 2014.
Net Capital Expenditure was Euro 21.6 million in the first six months of 2015, compared to Euro 24.4 million in the same period of 2014.
| Capex | ||
|---|---|---|
| (Million euros) | First Half 2015 | First Half 2014 |
| Retail | 14,862 | 17,661 |
| Wholesale | 1,359 | 4,184 |
| Corporate | 5,352 | 2,521 |
| Net Capex | 21,574 | 24,366 |
This document contains forward-looking statements, in particular in the sections headed "Outlook" and "Significant events occured after June 30, 2015" relating to future events and the operating income and financial results of the Moncler Group. These statements are based on the Group's current expectations and forecasts regarding future events and, by their nature involve risks and uncertainties since they refer to events and depend on circumstances which may, or may not, happen or occur in the future and, as such, they must not be unduly relied upon. The actual results could differ significantly from those contained in these statements due to a variety of factors, including volatility and decline of financial markets, fluctuation of raw material prices, changes in macroeconomics and in economic growth and other changes in business conditions, changes in the legal and institutional framework (both in Italy and abroad), and many other factors, most of which are beyond the Group's control.
On 1 January 2015, Moncler Shinsegae, a joint venture controlled by Moncler (51%), took over the 12 Moncler mono-brand stores in Korea from Shinsegae International.
In 2014, in fact, the subsidiary Industries S.p.A. signed a joint venture contract with Shinsegae International, a Korean company listed on the Seoul stock exchange, Moncler's distributor in Korea and one of the country's leading retailers in the fashion and luxury sector.
This joint venture started operations in 1 January 2015 to promote, develop and manage Moncler stores in the Asian country's most prestigious locations. By reaching direct control on Korea, Moncler has realised its strategy of directly controlling all markets in which it operates.
The shareholders, during the ordinary session of the meeting, approved the adoption of the equity-based incentive plan "2015 Performance Stock Option Plan" (the "2015 Plan") with the characteristics (including relevant terms and conditions) as described in the Directors' report and in the Plan's information document, both of which are available on the Company's website (www.monclergroup.com) in the section Governance / Shareholders' Meeting.
The 2015 Plan is intended for executive directors and/or Key-managers with strategic responsibilities and/or employees and/or external consultants and other collaborators of Moncler and its subsidiaries which are considered as having a strategic importance or are otherwise able to make a significant contribution to achieving Moncler's strategic objectives as determined by the Board of Directors based on the opinion of the Nomination and Remuneration Committee.
The 2015 Plan sets forth the assignment, free of charge, of options that allow for the subsequent subscription of the Company's ordinary shares at the established conditions. More specifically, each option granted gives the right for the beneficiary to purchase one (1) share by paying the Company the exercise price.
On April 23, 2015 the ordinary shareholders' meeting of the Parent company Moncler S.p.A. resolved to approve the financial statements for the year ended December 31, 2014 and to distribute a dividend of 0.12 euro per share for a total of Euro 30 million, payed on May 20, 2015.
No significant events occurred after June 30, 2015.
The Group is forecasting a scenario of increased revenues and profits in 2015, based on the following strategic lines:
Information regarding transactions with related parties are provided in Note 11.1 of the Half-year Condensed Consolidated Financial Statements.
There are no positions or transactions deriving from atypical and / or unusual transactions that could have a significant impact on the results and financial position of the Group.
MONCLER - HALF-YEAR FINANCIAL REPORT AS OF JUNE 30, 2015
The company does not own nor did it own during the period, even through a third party or through trusts, treasury shares or shares in parent companies.
Milan, 29 July 2015
For the Board of Directors The Chairman Remo Ruffini
Half-year consolidated statements
Consolidated Income Statement
Consolidated Statement of Comprehensive Income
Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity
Consolidated statement of Cash Flows
Notes to the half-year condensed consolidated financial Statements as of June 30, 2015
| Consolidated income statement | |||||
|---|---|---|---|---|---|
| (Euro/000) | Notes | 1H 2015 | of which related parties |
1H 2014 | of which related parties |
| Revenue | 4.1 | 295,789 | 245 | 218,299 | |
| Cost of sales | 4.2 | (80,783) | (4,492) | (63,296) | (2,544) |
| Gross margin | 215,006 | 155,003 | |||
| Selling expenses | 4.3 | (102,489) | (451) | (71,504) | (233) |
| General and administrative expenses | 4.4 | (37,920) | (3,072) | (31,258) | (2,765) |
| Advertising and promotion expenses | 4.5 | (20,835) | (17,157) | ||
| Non recurring income/(expenses) | 4.6 | (5,819) | (1,432) | (1,791) | (705) |
| Operating result | 4.7 | 47,943 | 33,293 | ||
| Financial income | 4.8 | 6,079 | 598 | ||
| Financial expenses | 4.8 | (2,933) | (5,672) | ||
| Result before taxes | 51,089 | 28,219 | |||
| Income taxes | 4.9 | (16,946) | (10,165) | ||
| Consolidated result | 34,143 | 18,054 | |||
| Net result, Group share | 34,040 | 18,078 | |||
| Non controlling interests | 103 | (24) | |||
| Earnings per share (unit of Euro) | 5.15 | 0.14 | 0.07 | ||
| Diluted earnings per share (unit of Euro) | 5.15 | 0.14 | 0.07 |
| Consolidated statement of comprehensive income | |||
|---|---|---|---|
| (Euro/000) | Notes | 1H 2015 | 1H 2014 |
| Net profit (loss) for the period | 34,143 | 18,054 | |
| Gains/(Losses) on fair value of hedging derivatives | 5.15 | (105) | (173) |
| Foreign exchange gains/(losses) on translating foreign operations |
5.15 | 1,532 | 1,391 |
| Items that are or may be reclassified subsequently to profit or loss |
1,427 | 1,218 | |
| Other Gains/(Losses) | 5.15 | 80 | (87) |
| Items that will never be reclassified to profit or loss | 80 | (87) | |
| Other comprehensive income/(loss), net of tax | 1,507 | 1,131 | |
| Total Comprehensive income/(loss) | 35,650 | 19,185 | |
| Attributable to: | |||
| Group | 35,530 | 19,209 | |
| Non controlling interests | 120 | (24) |
| (Euro/000) | Notes | June 30, 2015 | of which related parties |
December 31, 2014 |
of which related parties |
|---|---|---|---|---|---|
| Brands and other intangible assets - net | 5.1 | 258,458 | 258,771 | ||
| Goodwill | 5.1 | 155,582 | 155,582 | ||
| Property, plant and equipment - net | 5.3 | 86,327 | 77,254 | ||
| Other non-current assets | 5.8 | 22,008 | 17,251 | ||
| Deferred tax assets | 5.4 | 64,842 | 45,968 | ||
| Non-current assets | 587,217 | 554,826 | |||
| Inventories | 5.5 | 175,167 | 122,821 | ||
| Trade receivables | 5.6 | 59,355 | 17,620 | 86,593 | 1,130 |
| Current tax assets | 5.11 | 4,758 | 5,938 | ||
| Other current assets | 5.8 | 32,600 | 33,547 | ||
| Cash and cash equivalent | 5.7 | 102,110 | 123,419 | ||
| Current assets | 373,990 | 372,318 | |||
| Total assets | 961,207 | 927,144 | |||
| Share capital | 5.15 | 50,024 | 50,000 | ||
| Share premium reserve | 5.15 | 108,242 | 107,040 | ||
| Other reserves | 5.15 | 222,713 | 132,125 | ||
| Net result, Group share | 5.15 | 34,040 | 130,338 | ||
| Equity, Group share | 415,019 | 419,503 | |||
| Non controlling interests | 802 | 1,071 | |||
| Equity | 415,821 | 420,574 | |||
| Long-term borrowings | 5.14 | 150,920 | 154,243 | ||
| Provisions non-current | 5.12 | 3,670 | 3,110 | ||
| Pension funds and agents leaving indemnities | 5.13 | 4,712 | 5,112 | ||
| Deferred tax liabilities | 5.4 | 74,700 | 74,436 | ||
| Other non-current liabilities | 5.10 | 4,486 | 3,489 | ||
| Non-current liabilities | 238,488 | 240,390 | |||
| Short-term borrowings | 5.14 | 126,537 | 80,331 | ||
| Trade payables | 5.9 | 142,759 | 23,337 | 112,323 | 7,163 |
| Current tax liabilities | 5.11 | 11,098 | 43,556 | ||
| Other current liabilities | 5.10 | 26,504 | 1,269 | 29,970 | 1,896 |
| Current liabilities | 306,898 | 266,180 | |||
| Total liabilities and equity | 961,207 | 927,144 |
| Consolidated statement of changes in equity | Share | income | Other comprehensive | Other reserves | Result of the | Equity, non Total |
|||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (Euro/000) | Notes | Share capital | premium | Legal reserve | Cumulative translation reserve |
Other OCI items |
IFRS 2 reserve |
FTA reserve |
Retained earnings |
period, Group share |
Equity, Group share |
controlling interest |
consolidated Net Equity |
| Group shareholders' equity at January 1, 2014 |
5.15 | 50,000 | 107,040 | 10,000 | (4,931) | (151) | 0 | 1,242 | 68,223 | 76,072 | 307,495 | 3,090 | 310,585 |
| Allocation of Last Year Result | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 76,072 | (76,072) | 0 | 0 | 0 | |
| Changes in consolidation area | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| Dividends | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (25,000) | 0 | (25,000) | (2,634) | (27,634) | |
| Share capital increase | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| Other movements in Equity | 0 | 0 | 0 | 0 | 0 | 1,676 | 0 | 0 | 0 | 1,676 | 490 | 2,166 | |
| Other changes of comprehensive income | 0 | 0 | 0 | 1,389 | (259) | 0 | 0 | 0 | 0 | 1,130 | 2 | 1,132 | |
| Result of the period | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 18,078 | 18,078 | (24) | 18,054 | |
| Group shareholders' equity at June 30, 2014 | 5.15 | 50,000 | 107,040 | 10,000 | (3,542) | (410) | 1,676 | 1,242 | 119,295 | 18,078 | 303,379 | 924 | 304,303 |
| Group shareholders' equity at January 1, 2015 |
5.15 | 50,000 | 107,040 | 10,000 | (637) | (975) | 4,522 | 1,242 | 117,973 | 130,338 | 419,503 | 1,071 | 420,574 |
| Allocation of Last Year Result | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 130,338 | (130,338) | 0 | 0 | 0 | |
| Changes in consolidation area | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | |
| Dividends | 0 | 0 | 0 | 0 | 0 | 0 | 0 | (30,014) | 0 | (30,014) | (389) | (30,403) | |
| Share capital increase | 24 | 1,202 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 1,226 | 0 | 1,226 | |
| Other movements in Equity | 0 | 0 | 0 | 0 | 0 | 2,714 | (1,242) | (12,698) | 0 | (11,226) | 0 | (11,226) | |
| Other changes of comprehensive income | 0 | 0 | 0 | 1,515 | (25) | 0 | 0 | 0 | 0 | 1,490 | 17 | 1,507 | |
| Result of the period | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 34,040 | 34,040 | 103 | 34,143 | |
| Group shareholders' equity at June 30, 2015 | 5.15 | 50,024 | 108,242 | 10,000 | 878 | (1,000) | 7,236 | 0 | 205,599 | 34,040 | 415,019 | 802 | 415,821 |
| Consolidated statement of cash flows | 1H 2015 | of which related parties |
1H 2014 | of which related parties |
|---|---|---|---|---|
| (Euro/000) | ||||
| Cash flow from operating activities | ||||
| Consolidated result | 34,143 | 18,054 | ||
| Depreciation and amortization | 17,158 | 11,323 | ||
| Net financial (income)/expenses | 2,779 | 5,074 | ||
| Other non cash (income)/expenses | 2,714 | 1,676 | ||
| Income tax expenses | 16,946 | 10,165 | ||
| Changes in inventories - (Increase)/Decrease | (52,346) | (65,968) | ||
| Changes in trade receivables - (Increase)/Decrease | 27,238 | (16,490) | 39,570 | 834 |
| Changes in trade payables - Increase/(Decrease) | 30,436 | 16,174 | 36,755 | (4,104) |
| Changes in other current assets/liabilities | (4,742) | (627) | (16,177) | 409 |
| Cash flow from/(used) operating activities | 74,326 | 40,473 | ||
| Interest and other bank charges paid | (1,911) | (4,609) | ||
| Interest received | 154 | 139 | ||
| Income tax paid | (67,038) | (17,547) | ||
| Changes in other non-current assets/liabilities | (3,490) | (2,018) | ||
| Net cash flow from operating activities (a) | 2,041 | 16,437 | ||
| Cash flow from investing activities | ||||
| Purchase of tangible and intangible assets | (22,416) | (24,766) | ||
| Proceeds from sale of tangible and intangible assets | 842 | 400 | ||
| Net cash flow used in investing activities (b) | (21,574) | (24,366) | ||
| Cash flow from financing activities | ||||
| Repayment of borrowings | (33,844) | (41,920) | ||
| Proceeds from borrowings | 31,808 | 25,575 | ||
| Short term borrowings variation | 31,435 | 29,390 | ||
| Dividends paid to shareholders | (30,014) | (25,000) | ||
| Dividends paid to non-controlling interests | (389) | (2,634) | ||
| Share capital increase | 1,226 | 0 | ||
| Other changes in Net Equity | (1,379) | 1,482 | ||
| Net cash flow from financing activities (c) | (1,157) | (13,107) | ||
| Net increase/(decrease) in cash and cash equivalents (a)+(b)+(c) | (20,690) | (21,036) | ||
| Cash and cash equivalents at the beginning of the period Net increase/(decrease) in cash and cash equivalents |
122,400 (20,690) |
99,276 (21,036) |
||
| Cash and cash equivalents at the end of the period | 101,710 | 78,240 |
The parent company Moncler S.p.A. is a company established and domiciled in Italy. The address of the registered office is Via Stendhal 47 Milan, Italy, and its registration number is 04642290961.
The half-year condensed consolidated financial statements as of June 30, 2015 ("Half-year Consolidated Financial Statements") include the parent company and the subsidiaries (hereafter referred to as the "Group").
To date, the Group's principal activities are the study, design, production and distribution of clothing for men, women and children and related accessories under the Moncler brand name.
The Half-year Consolidated Financial Statements as of June 30, 2015 have been prepared in accordance with Art. 154-ter of Legislative Decree 58 of February 24, 1998 ("Testo Unico della Finanza – TUF"), as amended, and in conformity with IAS 34. They do not include all the information that would be necessary for the yearly consolidated financial statements and should be read together with consolidated financial statements as December 31, 2013, which were prepared in accordance with the international financial reporting standards ("IFRS") issued by the International Accounting Standards Board ("IASB") and endorsed by the European Union. The term "IFRS" is also used to refer to all revised international accounting standards ("IAS"), all interpretations of the International Financial Reporting Interpretations Committee ("IFRIC"), formerly known as the Standing Interpretations Committee ("SIC").
It should be noted that the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statement of financial position, the consolidated statement of changes in equity and the consolidated statement of cash flows are prepared in accordance and are the same as those used in the consolidated financial statements as of and for the year ended December 31, 2014. The following notes to the consolidated financial statements are presented in a summary format and do not include all the information required in an annual set of financial statements. It should be noted, as required by IAS 34, in order to avoid duplicating the information already provided, the notes refer exclusively to the consolidated income statement, consolidated statement of comprehensive income, consolidated statement of financial position, consolidated statement of changes in equity and the consolidated statement of cash flows, whose nature and changes are essential in order to understand the financial position and results of operations of the Group.
The Half-year Consolidated Financial Statements as of June 30, 2015 are made up of the consolidated income statement, the consolidated statement of comprehensive income, the consolidated statement of financial position, the consolidated statement of changes in equity, the consolidated statement of cash flows and the notes thereto. The comparative information included in these consolidated financial statements, as required by IAS 34, compares December 31, 2014 for the consolidated statement of financial position and the half-year ended June 30, 2014 for the consolidated changes in equity, the consolidated statement of income, the consolidated statement of comprehensive income and the consolidated statement of cash flows.
The Group presents the consolidated income statement by destination, the method that is considered most representative for the business at hand. This method is in fact consistent with the internal reporting and management of the business.
With reference to the consolidated statement of financial position, a basis of presentation has been chosen which makes a distinction between current and non-current assets and liabilities, in accordance with the provisions of paragraph 60 and thereafter of IAS 1.
The consolidated statement of cash flows is prepared under the indirect method.
According to the provisions of IAS 24 and Consob, the next few paragraphs describe related party transactions with the Group and their impact, if significant, on the consolidated statement of financial position, results of operations and cash flows.
The Half-year Consolidated Financial Statements have been prepared on the historical cost basis except for the measurement of certain financial instruments (i.e. derivative measured at fair value) and on a going concern basis.
The Half-year Consolidated Financial Statements are presented in Euro thousand, which is the functional currency of the markets where the Group mainly operates.
The preparation of Half-year Consolidated Financial Statements and the related notes in conformity with IFRS requires that management make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the reporting date. The estimates and related assumptions are based on historical experience and other relevant factors. The actual results could differ from those estimates. The estimates and underlying assumptions are reviewed periodically and any variations are reflected in the consolidated income statement in the period in which the estimate is revised if the revision affects only that period or even in subsequent periods if the revision affects both current and future periods.
In the event that management's estimate and judgment had a significant impact on the amounts recognized in the Half-year Consolidated Financial Statements or in case that there is a risk of future adjustments on the amounts recognized for assets and liabilities in the period immediately after the reporting date, the following notes will include the relevant information.
The estimates pertain mainly to the following items of the consolidated financial statements:
Non-current assets include property, plant and equipment, intangible assets with indefinite useful life and goodwill, investments and other financial assets.
Management periodically reviews non-current assets for impairment if events or changes in circumstances indicate that the carrying amount may not be recoverable. When a review for impairment is conducted, the recoverable amount is estimated based on the present value of future cash flows expected to derive from the asset or from the sale of the asset itself, at a suitable discount rate.
When the recoverable amount of a non-current asset is less than its carrying amount, an impairment loss is recognized immediately in profit or loss and the carrying amount is reduced to its recoverable amount determined based on value-in-use calculation or its sale's value in an arm's legth transaction, with reference to the most recent Group business plan.
The bad debt provision represents management's best estimate of the probable loss for unrecoverable trade receivables. A provision for impairment is determined based on expected losses arising from doubtful debt taking into consideration the original credit terms, the economic environment and the company's historical trend together with the monitoring controls in place.
The Group manufactures and sells mainly clothing goods that are subject to changing consumer demands and fashion trends. Inventory impairment represents management's best estimate for losses arising from the sales of aged products, taking into consideration their saleability through the Group's distribution channels.
The Group is subject to income taxes in numerous jurisdictions. Judgment is required in determining the provision for income taxes in each territory. The Group recognizes deferred tax assets when there is a reasonable expectation of realisation within a period that is consistent with management estimation and business plans.
The Group is subject to legal and tax litigations arising in the countries where it operates. Litigations are inevitably subject to risk and uncertainties surrounding the events and circumstances associated with the claims and associated with local legislation and jurisdiction. In the normal course of the business, management requests advice from the Group legal consultants and tax experts. The recognition of a provision is based on management's best estimate when an outflow of resources is probable to settle the obligation and the amount can be estimated with reliability. In those circumstances where the outflow of resources is possible or the amount of the obligation cannot be measured with sufficient reliability, the contingent liabilities is disclosed in the notes to the Half-year Consolidated Financial Statements.
The accounting policies set out below have been applied consistently as at and for the half-year ended June 30, 2015 and are the same used for the preparation of the consolidated financial statements as of and for the year ended December 31, 2014, to which refer for a detailed description.
In addition to those referred to in the consolidated financial statements for 2014 which should be consulted, below are the accounting standards, amendments and interpretations issued by the IASB and endorsed by the European Union which were adopted as of January 1, 2015.
On 20 May 2013, the IASB issued the IFRIC Interpretation 21, an interpretation of IAS 37 - Provisions, Contingent Liabilities and Contingent Assets. The interpretation sets out the accounting for an obligation to pay a levy that is not income tax. The interpretation addresses what the obligating event is that gives rise to pay a levy and when a liability should be recognized. IFRIC 21 is effective for annual periods beginning on or after 1 January 2014 with earlier adoption permitted (and in any case after the endorsement of the EU which took place on June 14, 2017).
This document introduces amendments to IFRS 2 – Share-based Payment (new definitions of a vesting condition and a market condition and additional definitions of a performance condition and a service condition), IFRS 3 – Business Combinations (clarifications of certain aspects regarding the classification and measurement of contingent consideration, with the resulting amendments to IAS 39 and IAS 37), IFRS 8 – Operating Segments (new disclosure requirements are introduced for segment aggregation and clarifications are provided on the reconciliation of total segment assets), IFRS 13 – Fair Value Measurement (clarifications on short-term receivables and payables with no stated interest rates), IAS 16 – Property, Plant and Equipment and IAS 38 – Intangible Assets (a clarification that if the revaluation model is used, adjustments to accumulated depreciation or amortisation are not always proportional to the adjustment of the gross carrying amount) and IAS 24 – Related Party Disclosures (clarifications on management entities and the relevant disclosures required).
This document introduces amendments to IFRS 1 – First-time Adoption of International Financial Reporting Standards (specifications regarding the early application by first-time adopters of documents issued by the IASB), IFRS 3 – Business Combinations (clarifications that joint operations are outside the scope of this standard), IFRS 13 – Fair Value Measurement (introduction of the extension of the exception in IFRS 13for the measurement at fair value on a net basis of a portfolio of assets and liabilities), IAS 16 –Property, Plant and Equipment and IAS 40– Investment Property (clarifications on the interrelationship between IAS 40 and IFRS 3 regarding the acquisition of an investment property).
The aim of this amendment to IAS 19 is to enable entities to simplify their accounting for defined benefit plans if the contributions made by employees or third parties satisfy specific requirements.
The adoption of the interpretations and standards did not have significant impact on the half-year condensed consolidated financial statements of the Group.
Please note that the Group has not early adopted the new standards, amendments or interpretations that have been issued but not yet effective.
The main exchange rates used to translate in Euro the financial statements of foreign subsidiaries as at and for half-year period ended June 30, 2015 are as follows:
| Average rate | Rate at the end of the period | Rate at the end of the period | |||||
|---|---|---|---|---|---|---|---|
| As at 31 December | As at 31 December | ||||||
| I half 2015 | I half 2014 | As at 30 June 2015 | As at 30 June 2014 | 2014 | 2013 | ||
| CHF | 1.056730 | 1.221450 | 1.041300 | 1.215600 | 1.202400 | 1.227600 | |
| CNY | 6.940810 | 8.449970 | 6.936600 | 8.472200 | 7.535800 | 8.349100 | |
| CZK | 27.502100 | 27.443900 | 27.253000 | 27.453000 | 27.735000 | 27.427000 | |
| DKK | 7.456160 | 7.462650 | 7.460400 | 7.455700 | 7.445300 | 7.459300 | |
| GBP | 0.732325 | 0.821344 | 0.711400 | 0.801500 | 0.778900 | 0.833700 | |
| HKD | 8.651700 | 10.629170 | 8.674000 | 10.585800 | 9.417000 | 10.693300 | |
| HUF | 307.506000 | 306.931000 | 314.930000 | 309.300000 | 315.540000 | 297.040000 | |
| JPY | 134.204000 | 140.403000 | 137.010000 | 138.440000 | 145.230000 | 144.720000 | |
| USD | 1.115790 | 1.370350 | 1.118900 | 1.365800 | 1.214100 | 1.379100 | |
| TRY | 2.862650 | 2.967770 | 2.995300 | 2.896900 | 2.832000 | 2.960500 | |
| BRL | 3.310150 | 3.149870 | 3.469900 | 3.000200 | 3.220700 | 3.257600 | |
| RUB | 64.640700 | 47.992400 | 62.355000 | 46.377900 | 72.337000 | 45.324600 | |
| TWD | 34.815800 | 41.384500 | 34.548700 | 40.804700 | 38.413300 | 41.140000 | |
| CAD | 1.377400 | 1.502900 | 1.383900 | 1.458900 | 1.406300 | n/a | |
| PLN | 4.140900 | n/a | 4.191100 | n/a | 4.273200 | n/a | |
| KRW | 1,227.310000 | n/a | 1,251.270000 | n/a | 1,324.800000 | n/a | |
| MOP | 8.911150 | n/a | 8.935279 | n/a | n/a | n/a | |
| AED | 4.096720 | n/a | 4.107482 | n/a | n/a | n/a |
As at June 30, 2015 the Half-year Consolidated Financial Statements of the Moncler Group include the parent company Moncler S.p.A. and 30 consolidated subsidiaries as detailed in the following table:
| Investments (in associates for consolidation) | Registered office | Share capital | Currency | % of ownership |
Parent company |
|---|---|---|---|---|---|
| Moncler S.p.A. | Milan (Italy) | 50,024,042 EUR | |||
| Industries S.p.A. | Milan (Italy) | 15,000,000 EUR | 100.00% Moncler S.p.A. | ||
| Moncler Enfant S.r.l. | Milan (Italy) | 200,000 EUR | 50.10% Industries S.p.A. | ||
| Pepper Grenoble S.à.r.l. | Echirolles - Grenoble (France) | 10,000 EUR | 100.00% Industries S.p.A. | ||
| Industries Textilvertrieb GmbH | Munich (Germany) | 700,000 EUR | 100.00% Industries S.p.A. | ||
| Moncler España S.L. | Madrid (Spain) | 50,000 EUR | 100.00% Industries S.p.A. | ||
| Moncler Asia Pacific Ltd | Hong Kong (China) | 300,000 HKD | 99.99% Industries S.p.A. | ||
| Moncler France S.à.r.l. | Paris (France) | 8,000,000 EUR | 100.00% Industries S.p.A. | ||
| Moncler USA Inc | New York (USA) | 1,000 USD | 100.00% Industries S.p.A. | ||
| Moncler UK Ltd | London (United Kingdom) | 2,000,000 GBP | 100.00% Industries S.p.A. | ||
| Moncler Japan Corporation (*) | Tokyo (Japan) | 195,050,000 JPY | 51.00% Industries S.p.A. | ||
| Moncler Shanghai Commercial Co. Ltd | Shanghai (China) | 31,797,714 CNY | 100.00% Industries S.p.A. | ||
| Moncler Suisse SA | Chiasso (Switzerland) | 1,400,000 CHF | 100.00% Industries S.p.A. | ||
| Ciolina Moncler SA | Berna (Switzerland) | 100,000 CHF | 51.00% Moncler Suisse SA | ||
| Moncler Belgium S.p.r.l. | Bruxelles (Belgium) | 500,000 EUR | 100.00% Industries S.p.A. | ||
| Moncler Denmark ApS | Copenhagen (Denmark) | 2,465,000 DKK | 100.00% Industries S.p.A. | ||
| Moncler Holland B.V. | Amsterdam (Holland) | 18,000 EUR | 100.00% Industries S.p.A. | ||
| Moncler Hungary KFT | Budapest (Hungary) | 150,000,000 HUF | 100.00% Industries S.p.A. | ||
| Moncler CZ S.r.o. | Praga (Czech Republic) | 1,000,000 CZK | 100.00% Industries S.p.A. | ||
| Moncler Lunettes S.r.l. | Milan (Italy) | 300,000 EUR | 51.00% Moncler S.p.A. | ||
| Moncler Istanbul Giyim ve Tekstil Ticaret Ltd. Sti. (*) Istanbul (Turkey) | 50,000 TRL | 51.00% Industries S.p.A. | |||
| Moncler Sylt Gmbh (*) | Hamm (Germany) | 100,000 EUR | 51.00% Industries Textilvertrieb GmbH | ||
| Moncler Rus LLC | Moscow (Russian Federation) | 40,000,000 RUB | 99,99% | Industries S.p.A. | |
| 0,01% | Moncler Suisse SA | ||||
| Moncler Brasil Comércio de moda e acessòrios Ltda Sao Paulo (Brazil) | 2,580,000 BRL | 95,00% | Moncler USA Inc | ||
| 5,00% | Industries S.p.A. | ||||
| Moncler Taiwan Limited | Taipei (China) | 10,000,000 TWD | 100.00% Industries S.p.A. | ||
| Moncler Canada Ltd | Vancouver (Canada) | 1,000 CAD | 100.00% Industries S.p.A. | ||
| Moncler Prague s.r.o. | Praga (Czech Republic) | 200,000 CZK | 100.00% Industries S.p.A. | ||
| White Tech Sp.zo.o. | Katowice (Poland) | 369,000 PLD | 70.00% Industries S.p.A. | ||
| Moncler Shinsegae Inc. (*) | Seoul (Korea) | 5,000,000,000 KRW | 51.00% Industries S.p.A. | ||
| Moncler Middle East FZ-LLC | Dubai (United Arab Emirates) | 50,000 AED | 100.00% Industries S.p.A. | ||
| Moncler USA Retail LLC | New York (USA) | 15,000,000 USD | 100.00% Moncler USA Inc |
(*) Fully consolidated (without attribution of interest to third parties)
As far as the scope of consolidation is concerned, the following changes occurred during the first half of 2015 when compared to December 31, 2014:
There are not subsidiaries excluded from the consolidation area.
Revenue per distribution channels are broken down as follows:
| (Euro/000) | 1H 2015 | % | 1H 2014 | % |
|---|---|---|---|---|
| Total revenues Whereas |
295,789 | 100.0% | 218,299 | 100.0% |
| Wholesale Retail |
94,431 201,358 |
31.9% 68.1% |
96,426 121,873 |
44.2% 55.8% |
Sales are made through two main distribution channels, wholesale and retail. The retail channel pertains to stores that are directly managed by the Group (DOS, concessions, e-commerce and outlets), while the wholesale channel pertains to stores managed by third parties either single-brand (i.e. shop-in-shop and franchising) or multi-brand (corner or space reserved within big name stores).
In the first six months of 2015, revenues from the retail distribution channel were Euro 201.4 million compared to Euro 121.9 million in the same period of 2014, representing an increase of 65%.This performance was due to solid organic growth and the continued development of our network of mono-brand retail stores (Directly Operated Stores, DOS).
The wholesale channel recorded revenues of Euro 94.4 million compared to Euro 96.4 million in the first half of 2014, 2% down. This result has been influenced by the newly established Korean joint venture, Moncler Shinsegae. Starting from January 1st, 2015 the Korean business (12 monobrand stores) has been converted from wholesale to retail making the performance of this channel not comparable. Excluding Korea, wholesale grew by 3% at constant exchange rates, due to an excellent performance in the United States and despite the reduction of some doors mainly in Italy and Europe.
| Revenues by region - (Euro/000) | ||||||||
|---|---|---|---|---|---|---|---|---|
| (Euro/000) | 1H 2015 | % | 1H 2014 | % | 2015 vs 2014 | % | ||
| Italy | 51,442 | 17.4% | 47,513 | 21.8% | 3,929 | 8.3% | ||
| EMEA, Italy excluded | 98,896 | 33.4% | 82,571 | 37.8% | 16,325 | 19.8% | ||
| Asia and rest of world | 102,722 | 34.7% | 66,635 | 30.5% | 36,087 | 54.2% | ||
| Americas | 42,729 | 14.5% | 21,580 | 9.9% | 21,149 | 98.0% | ||
| Total | 295,789 | 100.0% | 218,299 | 100.0% | 77,490 | 35.5% |
Sales are broken down by region as reported in the following table:
In the first half of fiscal year 2015, the Group recorded positive performances in all its markets.
In the Americas, the Group achieved 98.0% growth driven by the performances of both the retail and wholesale channels in North America (United States and Canada).
In Asia & Rest of the World, the Group recorded significant growth rates (+54.2%), mainly driven by the performance achieved in the retail channel in Greater China and Japan.
The EMEA countries recorded revenue growth of 19,8% at current exchange rates, with notable results from, among others, France, the United Kingdom and Germany.
In Italy, revenues rose by 8.3% compared to the first half of 2014, driven by the retail channel and supported by a solid wholesale network.
In the first half of 2015, cost of sales grew by Euro 17.5 million (+27.6%) in absolute terms, from Euro 63.3 million in the first half of 2014 to Euro 80.8 million in the first half of 2015. This overall growth is due to increased sales volumes and the growth of the retail channel. Cost of sales as a percentage of sales has decreased from 29.0% in the first half of 2014 to 27.3% in the first half of 2015. This decrease is due to the fact that the retail channel has increased its importance in the total sales from 55.8% in the first half of 2014 to 68.1% in the first half of 2015, on total sales.
Selling expenses grew both in absolute terms, with an increase of Euro 31.0 million between the first half of 2015 and the first half of 2014, and as a percentage of sales, from 32.8% in the first half of 2014 to 34.6% in the first half of 2015 due to the development of the retail business.
In the first half of 2015, general and administrative expenses amount to Euro 37.9 million, with an increase of Euro 6.7 million compared to the same period last year and therefore showing a lower growth rate than revenues. General and administrative expenses as a percentage of sales dropped from 14.3% in the first half of 2014 to 12.8 % in the first half of 2015.
Also during 2015, the Group continued to invest in marketing and advertising in order to support and spread awareness and the prestige of the Moncler brand. The weight of advertising expenses on turnover is equal to 7.0% for the first half of 2015 (7.9% for the first half of 2014), while in absolute value, it goes from Euro 17.2 million for the first half of 2014 to Euro 20.8 million for the first half of 2015, with an absolute change of Euro 3.6 million (+21.4%).
The item non recurring income and expenses for the first half of 2015 includes Euro 2.8 million (Euro 1.8 million for the same period of the last year) related to the costs incurred for the stock option plans approved by the Shareholder' Meeting of Moncler on February 28, 2014 and on April 23, 2015 and the effect of a revised valuation of receivables related to the sale of the "Other Brands Division", equal to Euro 3 million, which has been cautiously accounted for, being the outcome of the procedure for the determination of the selling price still uncertain.
The description of the incentive loyalty schemes and related costs is included in note 10.2.
For the first half of 2015, the operating result of the Group amounted to Euro 47.9 million (Euro 33.3 million for the same period of the last year) and as a percentage of revenues amounts to 16.2% (15.3% for the same period in the last year).
The operating result for the first half of 2015, net of non-recurring costs, amounted to Euro 53.8 (Euro 35.1 for the same period of 2014), and 18.2% as a percentage of revenue (16.1% for the same period of 2014), up in absolute value by Euro 18.7 million.
Management believes that EBITDA is an important indicator for the valuation of the Group's performance, insofar as it is not influenced by the methods for determining tax or amortisation/depreciation. However, EBITDA is not an indicator defined by the reference accounting standards applied by the Group and, therefore, it may be that the methods by which EBITDA is calculated are not comparable with those used by other companies.
EBITDA is calculated as follows:
| (Euro/000) | 1H 2015 | 1H 2014 2015 vs 2014 | % | |
|---|---|---|---|---|
| Operating result | 47,943 | 33,293 | 14,650 | 44.0% |
| Non recurring income and expenses | 5,819 | 1,791 | 4,028 | 224.9% |
| Operating result net of non recurring income and expenses |
53,762 | 35,084 | 18,678 | 53.2% |
| Amortization, depreciation and | ||||
| impairment | 17,158 | 11,323 | 5,835 | 51.5% |
| EBITDA | 70,920 | 46,407 | 24,513 | 52.8% |
In the first half of 2015, EBITDA increased by Euro 24.5 million (+52.8%), from Euro 46.4 million (21.3% of revenue) for the first half of 2014 to Euro 70.9 million (24.0% of revenue) for the first half of 2015. This increase mainly derives from the margin contribution of the retail channel and the control of the fixed cost.
Amortisation and depreciation for the first half of 2015 amounted to Euro 17.2 million (Euro 11.3 million for the same period of 2014) and grew by Euro 5.8 million.
The item is broken down as follows:
| (Euro/000) | 1H 2015 | 1H 2014 |
|---|---|---|
| Interest income and other financial income | 154 | 139 |
| Foreign currency gains | 5,925 | 459 |
| Total financial income | 6,079 | 598 |
| Interests expenses and other financial charges | (2,933) | (5,672) |
| Foreign currency losses | 0 | 0 |
| Total financial expenses | (2,933) | (5,672) |
| Total net financial items | 3,146 | (5,074) |
The income tax effect on the consolidated income statement is as follows:
| (Euro/000) | 1H 2015 | 1H 2014 |
|---|---|---|
| Current income taxes Deferred tax (income) expenses |
(32,662) 15,716 |
(19,656) 9,491 |
| Income taxes charged to the income | ||
| statement | (16,946) | (10,165) |
The following table lists the detail of the main personnel expenses by nature, compared with those of the same period of the previous year:
| (Euro/000) | 1H 2015 | 1H 2014 |
|---|---|---|
| Wages and salaries | 32,652 | 25,387 |
| Social security costs | 6,305 | 6,190 |
| Accrual for employment benefits | 1,983 | 1,008 |
| Total | 40,940 | 32,585 |
The remuneration related to the members of the Board of Directors is commented separately in the related party section.
The costs relating to stock option plans, equal to Euro 2.7 million (Euro 1.7 million in the first half of 2014) are separately commented in paragraph 10.2.
The following table reports the number of employees (full-time-equivalent) for the first half of 2015 compared to the same period of last year:
| Average FTE by area | ||
|---|---|---|
| Number | 1H 2015 | 1H 2014 |
| Italy | 581 | 561 |
| Other European countries | 298 | 308 |
| Asia and Japan | 592 | 377 |
| Americas | 140 | 91 |
| Total | 1,611 | 1,337 |
The actual number of employees of the Group as at June 30, 2015 is 1,576 (1,311 as at June 30, 2014).
The total number of employees increased principally as a result of the openings of new stores and outlets and overall growth of the structure.
Depreciation and amortization are broken down as follows:
| (Euro/000) | 1H 2015 | 1H 2014 |
|---|---|---|
| Depreciation of property, plant and equipment Amortization of intangible assets |
(13,227) (3,931) |
(8,520) (2,803) |
| Total Depreciation and Amortization | (17,158) | (11,323) |
The increase in both depreciation and amortization is mainly due to investments made associated with the new store openings. Please refer to comments made in paragraphs 5.1 and 5.3 for additional details related to investments made during the period.
| Brands and other intangible | ||||
|---|---|---|---|---|
| assets | December 31, 2014 | |||
| Gross value | Accumulated amortization |
Net value | Net value | |
| (Euro/000) | and impairment | |||
| Brands | 223,900 | 0 | 223,900 | 223,900 |
| Key money | 40,764 | (16,502) | 24,262 | 24,577 |
| Software | 19,429 | (11,045) | 8,384 | 7,316 |
| Other intangible assets | 5,004 | (3,092) | 1,912 | 2,036 |
| Assets in progress | 0 | 0 | 0 | 942 |
| Goodwill | 155,582 | 0 | 155,582 | 155,582 |
| Total | 444,679 | (30,639) | 414,040 | 414,353 |
The movements in intangible assets over the comparable periods are summarized in the following table:
| Gross value Brands and other intangible assets (Euro/000) |
Brands | Licence rights |
Key money and leasehold rights |
Software | Other intangible assets |
Assets in progress and advances |
Goodwill | Total |
|---|---|---|---|---|---|---|---|---|
| January 1, 2015 | 223,900 | 0 | 38,448 | 17,032 | 4,645 | 942 | 155,582 | 440,549 |
| Acquisitions | 0 | 0 | 1,240 | 1,846 | 265 | 0 | 0 | 3,351 |
| Disposals | 0 | 0 | 0 | (5) | (20) | 0 | 0 | (25) |
| Translation adjustement | 0 | 0 | 1,076 | 112 | 77 | 30 | 0 | 1,295 |
| Other movements, including transfers |
0 | 0 | 0 | 444 | 37 | (972) | 0 | (491) |
| June 30, 2015 | 223,900 | 0 | 40,764 | 19,429 | 5,004 | 0 | 155,582 | 444,679 |
| Accumulated amortization and impairment Brands and other intangible assets (Euro/000) |
Brands | Licence rights |
Key money and leasehold rights |
Software | Other intangible assets |
Assets in progress and advances |
Goodwill | Total |
| January 1, 2015 | 0 | 0 | (13,871) | (9,716) | (2,609) | 0 | 0 | (26,196) |
| Amortization Disposals |
0 0 |
0 0 |
(2,167) 0 |
(1,316) 3 |
(448) 8 |
0 0 |
0 0 |
(3,931) 11 |
| Translation adjustement | 0 | 0 | (464) | (16) | (43) | 0 | 0 | (523) |
| Impairment | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other movements, including transfers |
0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
As at June 30, 2014
| Gross value Brands and other intangible assets (Euro/000) |
Brands | Licence rights |
Key money and leasehold |
Software Other intangible assets |
Assets in progress and advances |
Goodwill | Total | |
|---|---|---|---|---|---|---|---|---|
| January 1, 2014 | 223,900 | 0 | 31,364 | 12,611 | 3,984 | 1,195 | 155,582 | 428,636 |
| Acquisitions | 0 | 0 | 0 | 1,292 | 347 | 7,026 | 0 | 8,665 |
| Disposals | 0 | 0 | 0 | (4) | (21) | 0 | 0 | (25) |
| Translation adjustement | 0 | 0 | 102 | 6 | (1) | 0 | 0 | 107 |
| Other movements, including transfers |
0 | 0 | 0 | 0 | 279 | (443) | 0 | (164) |
| June 30, 2014 | 223,900 | 0 | 31,466 | 13,905 | 4,588 | 7,778 | 155,582 | 437,219 |
| Accumulated amortization and impairment Brands and other intangible assets (Euro/000) |
Brands | Licence rights |
Key money and leasehold rights |
Software Other intangible assets |
Assets in progress and advances |
Goodwill | Total | |
| January 1, 2014 | 0 | 0 | (10,651) | (7,718) | (1,946) | 0 | 0 | (20,315) |
| Amortization | 0 | 0 | (1,596) | (854) | (353) | 0 | 0 | (2,803) |
| Disposals | 0 | 0 | 0 | 4 | 10 | 0 | 0 | 14 |
| Translation adjustement | 0 | 0 | (44) | (3) | 0 | 0 | 0 | (47) |
| Impairment | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other movements, including transfers |
0 | 0 | 0 | 0 | (7) | 0 | 0 | (7) |
| June 30, 2014 | 0 | 0 | (12,291) | (8,571) | (2,296) | 0 | 0 | (23,158) |
The increase in the item Key money refers to key money paid for one store in Italy and one store in Europe.
The increase in the item software pertains to the right of use acquired in information technology for the development and management of the business and the finance functions.
The items Brands, Other intangible fixed assets with an undefined useful life and Goodwill deriving from previous acquisitions have not been amortised, but have been tested for impairment by management.
The dynamics of business recorded in the periods examined and updated forecasts of future trends are consistent with the assumptions used to determine the recoverable amount of goodwill and the Moncler brand carried out during the preparation of the annual consolidated financial statements as at December 31, 2014. No indicators of possible impairment losses were identified and therefore no specific impairment tests were performed on these items.
| Property, plant and equipments | December 31, 2014 | |||
|---|---|---|---|---|
| (Euro/000) | Gross value | Accumulated depreciation and impairment |
Net value | Net value |
| Land and buildings | 5,350 | (2,505) | 2,845 | 925 |
| Plant and Equipment | 7,733 | (5,891) | 1,842 | 1,497 |
| Fixtures and fittings | 53,838 | (28,142) | 25,696 | 24,822 |
| Leasehold improvements | 82,345 | (38,077) | 44,268 | 44,147 |
| Other fixed assets | 11,183 | (7,698) | 3,485 | 3,478 |
| Assets in progress | 8,191 | 0 | 8,191 | 2,385 |
| Total | 168,640 | (82,313) | 86,327 | 77,254 |
| Gross value Property, plant and equipment (Euro/000) |
Land and buildings |
Plant and Equipment |
Fixtures and fittings |
Leasehold improvement s |
Other fixed assets |
Assets in progress and advances |
Total |
|---|---|---|---|---|---|---|---|
| January 1, 2015 | 3,358 | 7,132 | 47,435 | 74,046 | 10,903 | 2,385 | 145,259 |
| Acquisitions | 1,992 | 578 | 4,318 | 3,837 | 655 | 7,685 | 19,065 |
| Disposals | 0 | 0 | (1,181) | (574) | (502) | (2,257) | |
| Translation adjustement | 0 | 18 | 2,422 | 3,404 | 127 | 111 | 6,082 |
| Other movements, including transfers | 0 | 5 | 844 | 1,632 | 0 | (1,990) | 491 |
| June 30, 2015 | 5,350 | 7,733 | 53,838 | 82,345 | 11,183 | 8,191 | 168,640 |
| Accumulated depreciation and impairment PPE |
Land and | Plant and | Fixtures | Leasehold improvement |
Other fixed | Assets in progress and |
Total |
| (Euro/000) | buildings | Equipment | and fittings | s | assets | advances | |
| January 1, 2015 Depreciation |
(2,433) (72) |
(5,635) (243) |
(22,613) (5,419) |
(29,899) (6,832) |
(7,425) (661) |
0 0 |
(68,005) (13,227) |
| Disposals | 0 | 0 | 847 | 141 | 441 | 0 | 1,429 |
| Translation adjustement | 0 | (13) | (957) | (1,487) | (53) | 0 | (2,510) |
| Other movements, including transfers | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Gross value Property, plant and equipment (Euro/000) |
Land and buildings |
Plant and Equipment |
Fixtures and fittings |
Leasehold improvement s |
Other fixed assets |
Assets in progress and advances |
Total |
|---|---|---|---|---|---|---|---|
| January 1, 2014 | 3,358 | 6,675 | 35,208 | 50,442 | 8,738 | 2,084 | 106,505 |
| Acquisitions | 0 | 320 | 3,149 | 3,063 | 398 | 9,171 | 16,101 |
| Disposals | 0 | (31) | (495) | (1,448) | (96) | (25) | (2,095) |
| Translation adjustement | 0 | (2) | 223 | 310 | 0 | 33 | 564 |
| Other movements, including transfers | 0 | 0 | 778 | 1,022 | 0 | (1,629) | 171 |
| June 30, 2014 | 3,358 | 6,962 | 38,863 | 53,389 | 9,040 | 9,634 | 121,246 |
| Accumulated depreciation and impairment PPE (Euro/000) |
Land and buildings |
Plant and Equipment |
Fixtures and fittings |
Leasehold improvement s |
Other fixed assets |
Assets in progress and advances |
Total |
| January 1, 2014 | (2,337) | (5,351) | (15,058) | (19,205) | (6,306) | 0 | (48,257) |
| Depreciation | (48) | (204) | (3,378) | (4,354) | (536) | 0 | (8,520) |
| Disposals | 0 | 17 | 397 | 1,196 | 96 | 0 | 1,706 |
| Translation adjustement | 0 | 3 | (101) | (124) | (3) | 0 | (225) |
| Impairment | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| Other movements, including transfers | 0 | 0 | 0 | 0 | 0 | 0 | 0 |
| June 30, 2014 |
The changes in property plant and equipment in the first half of 2015 show an increase in the items fixtures and fittings, leasehold improvements and assets in progress and advances: those items are mainly related to the development of the retail network.
The balances of the items as at June 30, 2015, over the comparable period of last year is reported below:
| Deferred taxation | ||
|---|---|---|
| (Euro/000) | June 30, 2015 | December 31, 2014 |
| Deferred tax assets | 64,842 | 45,968 |
| Deferred tax liabilities | (74,700) | (74,436) |
| Net amount | (9,858) | (28,468) |
Deferred tax liabilities resulting from temporary differences associated with intangible assets are related to fiscal year 2008 in connection with the allocation of the brand name Moncler resulting from the excess price paid during acquisition.
Deferred tax assets and deferred tax liabilities are offset only when there is a law within a given tax jurisdiction which provides for such right to offset.
Inventory as at June 30, 2015 is broken down as follows:
| Inventory | ||
|---|---|---|
| (Euro/000) | June 30, 2015 | December 31, 2014 |
| Raw materials | 46,436 | 40,887 |
| Work-in-progress | 26,892 | 7,626 |
| Finished products | 147,451 | 113,910 |
| Inventories, gross | 220,779 | 162,423 |
| Obsolescence provision | (45,612) | (39,602) |
| Total | 175,167 | 122,821 |
Finished products and work-in-progress in inventory in the first half of each year are impacted by seasonality; specifically, they tend to increase compared to December as the average production cost of the articles of the autumn/winter collection, in stock in June, is higher than the average production cost of the articles of the spring/summer collection, in stock in December.
In addition, the inventory as at June 30, 2015 is affected by the development of the retail business and the related service levels.
The obsolescence provision is calculated using management's best estimate based on the season needs and the inventory balance based on passed sales trends through alternative channels and future sales volumes.
Trade receivables as at June 30, 2015 are as follows:
| Trade receivables | ||
|---|---|---|
| (Euro/000) | June 30, 2015 | December 31, 2014 |
| Trade receivables | 64,345 | 91,956 |
| Allowance for doubtful debt | (3,750) | (4,119) |
| Allowance for returns and discounts | (1,240) | (1,244) |
| Total, net value | 59,355 | 86,593 |
Trade receivables are related to the Group's wholesale business and they include balances with a collection time not greater than three months. During the first half of 2014 there were no concentration of credit risk greater than 10% associated to individual customers.
The allowance for doubtful debts was calculated in accordance with management's best estimate based on the ageing of accounts receivable as well as the solvency of the oldest accounts and also taking into consideration any balances turned over into collection proceedings. Trade receivables written down are related to specific balances that were past due and for which collection is uncertain.
As at June 30, 2015 the item cash on hand and cash at banks amounts to Euro 102.1 million (Euro 123.4 million as at December 31, 2014), includes cash and cash equivalents as well as the funds available in banks.
The amount included in the half-year condensed consolidated financial statements represents the fair value at the date of the financial statements. The credit risk is very limited since the other parties are class A financial institutions.
The consolidated statement of cash flows includes the changes in cash and cash at banks as well as the bank overdrafts.
The following table shows the reconciliation between cash and cash at banks with those included in the consolidated statement of cash flows:
| Cash and cash equivalents included in the Statement of cash flows |
||
|---|---|---|
| (Euro/000) | June 30, 2015 December 31, 2014 | |
| Cash in hand and at banks | 102,110 | 123,419 |
| Bank overdraft | (400) | (1,019) |
| Total | 101,710 | 122,400 |
| Cash and cash equivalents included in the | ||
| (Euro/000) | June 30, 2014 December 31, 2013 | |
| Cash in hand and at banks | 87,023 | 105,300 |
| Bank overdraft | (8,783) | (6,024) |
| Other current and non-current assets | ||
|---|---|---|
| (Euro/000) | June 30, 2015 | December 31, 2014 |
| Prepayments and accrued income - current | 12,500 | 10,655 |
| Other current receivables | 20,100 | 22,892 |
| Other current assets | 32,600 | 33,547 |
| Prepayments and accrued income - non-current | 1,990 | 2,304 |
| Security / guarantees deposits | 19,379 | 11,440 |
| Other non-current receivables | 639 | 3,507 |
| Other non-current assets | 22,008 | 17,251 |
| Total | 54,608 | 50,798 |
As at June 30, 2015, the item prepayments and accrued income - current amounts to Euro 12.5 million (Euro 10.7 million as at December 31, 2014) and mainly pertains to the samples of subsequent seasons, product style, advertising and communication, rent and other assets.
The item other current receivables mainly contains the receivable due from the tax authority for value added tax and the residual receivable arising from the Other Brands Division disposal occured in November 2013.
As of today's date the disagreement over the determination of the third instalment of the price for the sale of the "Other Brands" division has not yet been resolved; to this end a professional was appointed during the first half of 2015, assigned the functions of "Expert" (pursuant to the sales agreement), to determine the final sales price, and this procedure was still in progress at the date of preparation of these Half-year Consolidated Financial Statements.
In addition, a dispute also currently exists over the interpretation and execution of the clauses of the sales agreement, with the consequent filing for arbitration at the London Court of Arbitration. The procedure is at a preliminary stage.
The directors believe that the amount of Euro 6.6 million originally recognized in the financial statements is a reasonable reflection of Moncler's legitimate claims at the date of recognition.
Nevertheless, given that the outcome of the procedure for the determination of the price is uncertain, especially concerning the valuation of a series of items in dispute, the directors have prudently decided to reflect that risk, which has been quantified in approximately Euro 3 million, by making a corresponding reduction in the receivable.
The expert's report is expected to be issued by July 31, 2015.
Prepayments and accrued income non-current amount to Euro 2.0 million (Euro 2.3 million as at 31 December 2014) and pertain to prepaid rents that extend over the current year.
Deposits are mostly related to the amounts paid on behalf of the lessee as a guarantee to the lease agreement.
There are no differences between the amounts included in the consolidated financial statements and their fair values.
Trade payables amount to Euro 142.8 million as at June 30, 2015 (Euro 112.3 million as at December 31, 2014) and pertain to current amounts due to suppliers for goods and services. These payables pertain to amounts that are payable within the upcoming year and do not include amounts that will be paid over 12 months.
In the first half of 2015 there are no outstanding positions associated to individual suppliers that exceed 10% of the total value.
The increase in trade payables as at June 30, 2015 compared to December 31, 2014 is due to the fact that the balance as of June 30, 2015 pertains to purchases related to the fall/winter collection which has an average value higher when compared to the spring/summer collection making up the trade payable balance as of December, 31.
There are no difference between the amounts included in the half-year condensed consolidated financial statements and their respective fair values.
| Other current and non-current liabilities | ||
|---|---|---|
| (Euro/000) | June 30, 2015 December 31, 2014 | |
| Deferred income and accrued expenses - current | 2,096 | 1,989 |
| Advances and payments on account to customers | 6,534 | 2,443 |
| Employee and social institutions | 11,518 | 13,416 |
| Tax accounts payable, excluding income taxes | 2,889 | 7,681 |
| Other current payables | 3,467 | 4,441 |
| Other current liabilities | 26,504 | 29,970 |
| Deferred income and accrued expenses - non-current | 4,486 | 3,489 |
| Other non-current liabilities | 4,486 | 3,489 |
| Total | 30,990 | 33,459 |
As at June 30, 2015, the item is detailed as shown in the following table:
The item tax accounts payable mainly includes value added tax (VAT) and payroll tax withholding.
Deferred income and accrued expenses – non current pertain to rent payable extending over a year.
Tax assets amount to Euro 4.8 million as at June 30, 2015 (Euro 5.9 million as at December 31, 2014) and pertain to receivables for advances paid on taxes.
Tax liabilities amounted to Euro 11.1 million as at June 30, 2015 (Euro 43.6 million as at December 31, 2014). The decrease in the item is mainly due to the payment of the taxes for the year 2014.
Tax liabilities are recognized net of current tax assets, where the offsetting relates to the same tax jurisdiction and tax system.
Non-current provisions as at June 30, 2015 are detailed in the following table:
| Provision for contingencies and losses | ||
|---|---|---|
| (Euro/000) | June 30, 2015 | December 31, 2014 |
| Tax litigations | 1,015 | 1,015 |
| Other non current contingencies | 2,655 | 2,095 |
| Total | 3,670 | 3,110 |
Pension funds and agents leaving indemnities as at June 30, 2015 are detailed in the following table:
| Employees pension funds | ||
|---|---|---|
| (Euro/000) | June 30, 2015 | December 31, 2014 |
| Pension funds | 2,104 | 2,146 |
| Agents leaving indemnities | 2,608 | 2,966 |
| Total | 4,712 | 5,112 |
The pension funds pertain mainly to Italian entities of the Group. Following the recent welfare reform, beginning on 1 January 2007, the liability has taken the form of a defined contribution plan. Therefore, the amount of pension fund (TFR) accrued prior to the application of the reform and not yet paid to the employees as of the date of the consolidated financial statements is considered as a defined benefit plan.
Financial liabilities as at June 30, 2015 are detailed in the following table:
| Borrowings | ||
|---|---|---|
| (Euro/000) | June 30, 2015 December 31, 2014 | |
| Bank overdraft | 400 | 1,019 |
| Short-term bank loans | 60,803 | 27,356 |
| Short-term portion of long-term bank loans | 60,190 | 42,916 |
| Other short-term loans | 5,144 | 9,040 |
| Short-term borrowings | 126,537 | 80,331 |
| Long-term borrowings | 150,920 | 154,243 |
| Total | 277,457 | 234,574 |
Short-term borrowings include advance payments on invoices, bank receipts and short-term loans related to working capital as well as the current portion of long-term bank loans.
Long-term borrowings include the portion expiring beyond one year related both to financial institution and third parties.
The following tables show the break down of the borrowing in accordance with their maturity date:
| Ageing of the financial liabilities | ||
|---|---|---|
| (Euro/000) | June 30, 2015 | December 31, 2014 |
| Within 2 years | 64,788 | 66,703 |
| From 2 to 5 years | 86,132 | 87,540 |
| Beyond 5 years | 0 | 0 |
| Total | 150,920 | 154,243 |
The loans do not include covenants.
The net financial position is detailed in the following tables:
| Net financial position | ||
|---|---|---|
| (Euro/000) | June 30, 2015 | December 31, 2014 |
| Cash and cash equivalents | 102,110 | 123,419 |
| Debts and other current financial liabilities | (126,537) | (80,331) |
| Debts and other non-current financial liabilities | (150,920) | (154,243) |
| Total | (175,347) | (111,155) |
| (Euro/000) | June 30, 2015 | December 31, 2014 |
|---|---|---|
| A. Cash in hand | 373 | 947 |
| B. Cash at banks and cash equivalents | 101,737 | 122,472 |
| C. Available for sale securities | 0 | 0 |
| D. Liquidity (A)+(B)+(C) | 102,110 | 123,419 |
| E .Current financial assets | 0 | 0 |
| F. Payable to banks, current | (61,203) | (28,375) |
| G. Current portion of long-term debt | (60,190) | (42,916) |
| H. Other current financial debt | (5,144) | (9,040) |
| I. Current financial debt (F)+(G)+(H) | (126,537) | (80,331) |
| J. Net current financial debt (I)-(E)-(D) | (24,427) | 43,088 |
| K. Payable to bank, non-current | (102,290) | (121,699) |
| L. Bonds issued | 0 | 0 |
| M. Other non-current payables | (48,630) | (32,544) |
| N. Non-current financial debt (K)+(L)+(M) | (150,920) | (154,243) |
| O. Net financial debt (J)+(N) | (175,347) | (111,155) |
Net financial position as defined by the CESR Recommendation of 10 February 2005 (referred to by the Consob Communication of 28 July 2006).
Changes in shareholders' equity for the first half of 2015 and the comparative period are included in the consolidated statements of changes in equity.
The legal reserve and premium reserve pertain to the parent company Moncler S.p.A.
The increase of the share capital and the share premium reserve arises from the exercise of n. 120,210 vested options (for the same number of shares) in relation to the stock option plan approved by the shareholders meeting of MonclerS.p.A. dated February 28, 2014 at the exercise price of Euro 10.20 per share.
The other changes in shareholders' equity mainly relate to the impact of the accounting treatment of the stock option plan.
The change in retained earnings is due to the dividends distribution to shareholders.
On May, 20 2015 the parent company Moncler S.p.A. distributed dividends for an amount of Euro 30,014 thousand (Euro 0.12 per share).
Other reserves includes other comprehensive income comprising the exchange rate transformation reserve of financial statements reported in foreign currencies, the reserve for hedging interest rate risks and the reserve for actuarial gains/losses. The conversion reserve includes the exchange differences emerging from the conversion of the financial statements of the foreign consolidated companies; the changes are mainly due to the differences resulting from the consolidation of the American subsidiaries, of the Chinese and the Japanese company. The hedging reserve includes the efficient portion of the net differences accumulated in the fair value of the derivative hedge instruments. Changes to these reserves were as follows:
| Other comprehensive income | Cumulative translation reserve | Other OCI items | ||||
|---|---|---|---|---|---|---|
| (Euro/000) | Value before tax effect |
Tax effect | Value after tax effect |
Value before tax effect |
Tax effect | Value after tax effect |
| Reserve as at January 1, 2014 | (4,931) | 0 | (4,931) | (170) | 19 | (151) |
| Changes in the period | 1,389 | 0 | 1,389 | (356) | 97 | (259) |
| Translation differences of the period | 0 | 0 | 0 | 0 | 0 | 0 |
| Reversal in the income statement of the period |
0 | 0 | 0 | 0 | 0 | 0 |
| Reserve as at June 30, 2014 | (3,542) | 0 | (3,542) | (526) | 116 | (410) |
| Reserve as at January 1, 2015 | (637) | 0 | (637) | (1,314) | 339 | (975) |
| Changes in the period | 1,515 | 0 | 1,515 | (35) | 10 | (25) |
| Translation differences of the period | 0 | 0 | 0 | 0 | 0 | 0 |
| Reversal in the income statement of the period |
0 | 0 | 0 | 0 | 0 | 0 |
| Reserve as at June 30, 2015 | 878 | 0 | 878 | (1,349) | 349 | (1,000) |
Earning per share for the half-year ended June 30, 2015 and June 30, 2014 is included in the following table and is based on the relationship between net income attributable to the Group and the average number of outstanding shares.
The diluted earnings per share is in line with the basic earnings per share as at June 30, 2015 as there are no significant dilutive effects arising from stock option plans.
| Earnings per share | ||
|---|---|---|
| 1H 2015 | 1H 2014 | |
| Net result of the period (Euro/000) | 34,040 | 18,078 |
| Average number of shares related to parent's Shareholders |
250,047,695 | 250,000,000 |
| Earnings attributable to Shareholders (Unit of Euro) |
0.14 | 0.07 |
| Diluited earnings attributable to Shareholders (Unit of Euro) |
0.14 | 0.07 |
For the purposes of IFRS 8 "Operating Segments", the Group's activity is part of a single operating segment.
The Moncler Group's results are influenced by various factors linked to seasonability, which are typical of the fashion and luxury industry in which the Group operates.
The Moncler Group's first trend of seasonality depends on sales typical of the wholesale distribution channel, where sales revenues are concentrated in the first and third quarters of each fiscal year. The billing for the products sold is in fact concentrated in the months of January, February and March, when the third-party resellers buy the goods for the spring/summer collection, and in the months of July, August and September, when purchases are made for the fall/winter collection.
Another trend related to seasonality of the Moncler Group pertains to the invoicing of sales for the retail distribution channel which is mainly concentrated in the second half of the year and, in particular, in the last quarter of each fiscal year when customers buy products from the fall/winter collection, which is the Group's traditional strength.
As a result, the interim results may not contribute equally to the financial results achieved by the Group during the year. In addition, this seasonality combined with other factors such as the change over time of the relationship between retail and wholesale results could make it impossible to compare the results of the same interim periods of several years.
Finally, the sales trend and the dynamics of the production cycles have an impact on the net working capital and net debt, which are at their peaks during the months of September and October, while the months of November, December and January are characterized by high cash generation.
The Group's commitments pertain mostly to lease agreements related to the location where sales are generated (stores, outlet and showroom), the location where inventories are stored and the location where the administrative functions are performed.
| Operating lease commitments - future minimum payments (Euro/000) |
Less than 1 year |
Between 1 and 5 years |
Beyond 5 years |
Total |
|---|---|---|---|---|
| DOS | 30,875 | 82,173 | 57,439 | 170,486 |
| Outlet | 1,687 | 6,325 | 4,199 | 12,211 |
| Other buildings | 5,200 | 19,380 | 13,313 | 37,893 |
As at June 30, 2015, the outstanding operating lease balance was as follows:
As at June 30, 2015 the Group had given the following guarantees:
| Guarantees and bails given | ||
|---|---|---|
| (Euro/000) | June 30, 2015 | December 31, 2014 |
| Guarantees and bails given for the benefit of: | ||
| Third parties/companies | 9,507 | 8,869 |
| Total guarantees and bails | 9,507 | 8,869 |
Guarantees pertain mainly to lease agreements for the new stores.
As the Group operates globally, it is subject to risks which may arise during the performance of its ordinary activities. Based on information available to date, the Group believes that as of the date of the half-year condensed consolidated financial statements, the provisions set up are adequate to ensure that the half-year condensed consolidated financial statements give a true and fair view of the Group's financial position and results of operations.
Transactions and balances with consolidated companies have been eliminated upon consolidation, therefore there are no comments there.
Set out below are the transactions with related parties deemed relevant for the purposes of the "Procedure with related party" adopted by the Group.
The "Procedure with related party" is available on the Company's website (www.monclergroup.com, under "Governance/Corporate documents").
During the first-half of 2015 related party transactions mainly relate to trading transactions carried out on an arm's length basis with the following parties:
Industries S.p.A., Moncler Lunettes S.r.l. and Moncler Enfant S.r.l. adhere to the Parent Company Moncler S.p.A. fiscal consolidation.
Compensation paid to directors, board of statutory auditors and executives with strategic responsibilities Compensation paid of the members of the Board of Directors in the first half 2015 are Euro 1,606 thousand (Euro 1,593 thousand in the first half 2014).
Compensation paid of the members of the Board of Auditors in the first half 2015 are Euro 97 thousand (Euro 117 thousand in the first half 2014).
In the first half of 2015 total compensation paid to executives with strategic responsibilities amounted to Euro 730 thousand (Euro 645 thounsand in the first half 2014).
In the first half of 2015 the costs relating to stock option plans (described in section 10.2) referring to members of the Board of Directors and Key management personnel amount to Euro 1,432 thousand (Euro 705 in the first half 2014).
| Euro/000 | Type of relationship | Note June 30, 2015 | % | June 30, 2014 | % | |
|---|---|---|---|---|---|---|
| Yagi Tsusho Ltd | Distribution agreement | a | 25,295 | (31.3)% | 22,387 | (35.4)% |
| Yagi Tsusho Ltd | Distribution agreement | a | (29,787) | 36.9% | (24,931) | 39.4% |
| GokseTekstil Kozmetik | ||||||
| Sanayi ic ve dis ticaret | Service agreement | b | (80) | 0.2% | (98) | 0.3% |
| limited sirketi | ||||||
| Allison S.p.A. | Trade transactions/Service | b | (478) | 1.3% | (545) | 1.7% |
| agreement | ||||||
| La Rotonda S.r.l. | Trade transactions | c | 245 | 0.1% | n.a. | n.a. |
| La Rotonda S.r.l. | Trade transactions | d | (73) | 0.1% | n.a. | n.a. |
| Shinsegae International | Trade transactions | b | (334) | 0.9% | n.a. | n.a. |
| Inc. | ||||||
| Shinsegae International | Trade transactions | e | (125) | 0.1% | n.a. | n.a. |
| Inc. | ||||||
| Directors, board of | ||||||
| statutory auditors and | Labour services | b | (2,180) | 5.7% | (2,122) | 6.8% |
| executives with strategic | ||||||
| responsibilities | ||||||
| Executives with strategic | Labour services | d | (253) | 0.2% | (233) | 0.3% |
| responsibilities | ||||||
| Directors and executives | ||||||
| with strategic | Labour services | e | (1,432) | 24.6% | (705) | 39.4% |
| responsibilities | ||||||
| Total | (9,202) | (6,247) |
The following tables summarize the afore-mentioned related party transactions that took place during the first half of 2015 and the comparative period.
a effect in % based on cost of sales
b effect in % based on general and administrative expenses
c effect in % based on revenues
d effect in % based on selling expenses
e effect in % based on non recurring income/(expenses)
| Euro/000 | Type of relationship | Note | June 30, 2015 | % | June 30, 2014 | % |
|---|---|---|---|---|---|---|
| Yagi Tsusho Ltd | Trade payables | a | (21,984) | 15.4% | (6,826) | 6.1% |
| Yagi Tsusho Ltd | Trade receivables | b | 17,216 | 29.0% | 928 | 1.1% |
| Gokse Tekstil Kozmetik | ||||||
| Sanayi ic ve dis ticaret | Trade payables | a | (3) | 0.0% | (85) | 0.1% |
| limited sirketi | ||||||
| Gokse Tekstil Kozmetik | ||||||
| Sanayi ic ve dis ticaret | Trade receivables | b | 0 | 0.0% | 0 | 0.0% |
| limited sirketi | ||||||
| Allison S.p.A. | Trade payables | a | (598) | 0.4% | (207) | 0.2% |
| La Rotonda S.r.l. | Trade receivables | b | 404 | 0.7% | 202 | 0.2% |
| La Rotonda S.r.l. | Trade payables | a | (37) | 0.0% | (45) | 0.0% |
| Shinsegae International | ||||||
| Inc. | Trade payables | a | (715) | 0.5% | n.a. | n.a. |
| Directors, board of | ||||||
| statutory auditors and | ||||||
| executives with strategic | Other current liabilities | c | (1,269) | 4.8% | (1,896) | 6.3% |
| responsibilities | ||||||
| Total | (6,986) | (7,929) |
a effect in % based on trade payables
b effect in % based on trade receivables
c effect in % based on other current liabilities
The following tables summarize the weight of related party trasactions on the items of the consolidated financial statements.
| June 30, 2015 | ||||||
|---|---|---|---|---|---|---|
| General and | Non recurring | |||||
| Selling | administrative | income/ | Financial | |||
| Revenue | Cost of sales | expenses | expenses | (expenses) | expenses | |
| Total related parties | 245 | (4,492) | (451) | (3,072) | (1,432) | 0 |
| Total consolidated financial statements | 295,789 | (80,783) | (102,489) | (37,920) | (5,819) | (2,933) |
| weight % | 0.1% | 5.6% | 0.4% | 8.1% | 24.6% | 0.0% |
| June 30, 2014 | ||||||
|---|---|---|---|---|---|---|
| General and | Non recurring | |||||
| Selling | administrative | income/ | Financial | |||
| Revenue | Cost of sales | expenses | expenses | (expenses) | expenses | |
| Total related parties | 0 | (2,544) | (233) | (2,765) | (705) | 0 |
| Total consolidated financial statements | 218,299 | (63,296) | (71,504) | (31,258) | (1,791) | (5,672) |
| weight % | 0.0% | 4.0% | 0.3% | 8.8% | 39.4% | 0.0% |
| June 30, 2015 | |||||
|---|---|---|---|---|---|
| Trade | Other current | Total financial | |||
| receivables | Trade Payables | liabilities | debt | ||
| Total related parties | 17,620 | (23,337) | (1,269) | 0 | |
| Total consolidated financial statements | 59,355 | (142,759) | (26,504) | (277,457) | |
| weight % | 29.7% | 16.3% | 4.8% | 0.0% |
| December 31, 2014 | |||||
|---|---|---|---|---|---|
| Trade | Other current | Total financial | |||
| receivables | Trade Payables | liabilities | debt | ||
| Total related parties | 1,130 | (7,163) | (1,896) | 0 | |
| Total consolidated financial statements | 86,593 | (112,323) | (29,970) | (234,574) | |
| weight % | 1.3% | 6.4% | 6.3% | 0.0% |
The Half-year Consolidated Financial Statements at June 30, 2015 reflects the values of the stock option plans approved in 2014 and 2015.
With regard to stock option plans approved in 2014, please note that:
On April 29, 2015, the shareholders meeting of Moncler approved the adoption of the equity-based incentive plan ("2015 Plan") with the characteristics as described below:
As stated by IFRS 2, these plans are defined as Equity Settled.
For information regarding the plan, please see the company's website, www.monclergroup.com, in the "Governance" section.
On April, 29 2015, the Moncler Ordinary Shareholders' Meeting approved an incentive loyalty schemes, known as " Performance Stock Option 2015". The description of the incentive loyalty schemes and the related costs are included in note10.2.
For further information please refer to paragraphs 4.6 and 5.8.
No atypical and/or unusual transactions were carried out by the Group during the first half of 2015.
The following table shows the carrying amount and fair values of financial assets and financial liabilities, including their levels in the fair value hierarchy for financial instruments measured at fair value. It does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying amount is a reasonable approximation of fair value.
| (Euro/000) | ||||
|---|---|---|---|---|
| June 30, 2015 | Current | Non-current Fair value | Level | |
| Financial assets measured at fair value | ||||
| Interest rate swap used for hedging | - | - | - | |
| Forward exchange contracts used for hedging | - | - | - | |
| Sub-total | - | - | - | |
| Financial assets not measured at fair value | ||||
| Trade and other receivables (*) | 65,946 | 19,379 | ||
| Cash and cash equivalents (*) | 102,110 | - | ||
| Sub-total | 168,056 | 19,379 | - | |
| Total | 168,056 | 19,379 | - | |
| (Euro/000) | ||||
| December 31, 2014 | Current | Non-current Fair value | Level | |
| Financial assets measured at fair value | ||||
| Interest rate swap used for hedging | - | - | - | |
| Forward exchange contracts used for hedging | - | - | - | |
| Sub-total | - | - | - | |
| Financial assets not measured at fair value | ||||
| Trade and other receivables (*) | 93,184 | 11,440 | ||
| Cash and cash equivalents (*) | 123,419 | - | ||
| Sub-total | 216,603 | 11,440 | - |
| (Euro/000) | ||||
|---|---|---|---|---|
| June 30, 2015 | Current | Non-current Fair value | Level | |
| Financial liabilities measured at fair value | ||||
| Interest rate swap used for hedging | (342) | - | (342) | 2 |
| Forward exchange contracts used for hedging | (2,000) | - | (2,000) | 2 |
| Other financial liabilities | (3,144) | (48,630) | (51,774) | 3 |
| Sub-total | (5,486) | (48,630) | (54,116) | |
| Financial liabilities not measured at fair value | ||||
| Trade and other payables (*) | (146,225) | - | ||
| Bank overdrafts (*) | (400) | - | ||
| Short-term bank loans (*) | (60,803) | - | ||
| Bank loans | (59,848) | (102,290) | (162,138) | |
| Sub-total | (267,276) | (102,290) | (162,138) | |
| Total | (272,762) | (150,920) | (216,254) | |
| (Euro/000) | ||||
| December 31, 2014 | Current | Non-current Fair value | Level | |
| Financial liabilities measured at fair value | ||||
| Interest rate swap used for hedging | (670) | - | (670) | 2 |
| Forward exchange contracts used for hedging | (3,905) | - | (3,905) | 2 |
| Other financial liabilities | (3,123) | (32,544) | (35,667) | 3 |
| Sub-total | (7,698) | (32,544) | (40,242) | |
| Financial liabilities not measured at fair value | ||||
| Trade and other payables (*) | (118,776) | - | ||
| Bank overdrafts (*) | (1,019) | - | ||
| Short-term bank loans (*) | (27,356) | - | ||
| Bank loans | (42,246) | (121,699) | (163,945) | |
| Sub-total | (189,397) | (121,699) | (163,945) |
(*) Such items refer to short-term financial assets and financial liabilities whose carrying value is a reasonable approximation of fair value, which was therefore not disclosed.
No significant events occurred after the end of the period.
***
These Half-Year Consolidated Financial Statements, comprised of the consolidated statement of income, consolidated statement of comprehensive income, the consolidated statement of financial position, consolidated statement of changes in equity, consolidated statement of cash flows and notes thereto, are an accurate and fair representation of the Group's equity and financial situation and economic result, and corresponds to the accounting records of the parent company and the companies included in the consolidation.
On behalf of the Board of Directors of Moncler S.p.A.
The Chairman
Remo Ruffini
The undersigned, Remo Ruffini, in his capacity as the Chief Executive Officer of Moncler S.p.A. and Luciano Santel, as the executive officer responsible for the preparation of Moncler S.p.A.'s financial statements, having also taken into account the provisions of Article 154-bis, paragraphs 3 and 4, of the Italian Legislative Decree 58 of 24 February 1998, hereby certify:
i. the adequacy in relation to the characteristics of the company and
3.2 The half-year directors' report includes a reliable analysis of the significant events that took place in the first six months of the financial year and their impact on the half-year condensed consolidated financial statements, together with a description of the main risks and uncertainties for the remaining six months of the financial year. The half-year directors' report also includes a reliable analysis of the disclosure on significant related party transactions.
Milan, 29 July 2015
Chief Executive Officer Executive Officer responsible for the preparation of the Company's financial statements
Remo Ruffini Luciano Santel
KPMG S.p.A. Revisione e organizzazione contabile Via Bosa Zalivani 2 31100 TREVISO TV
Telefono +39 0422 576711 Telefax +39 0422 410891 e-mail [email protected] PEC [email protected]
(Translation from the Italian original which remains the definitive version)
To the shareholders of Moncler S.p.A.
We have reviewed the accompanying condensed interim consolidated financial statements of the Moncler Group, comprising the income statement, statement of comprehensive income. statement of financial position, statement of changes in equity, statement of cash flows and notes thereto, as at and for the six months ended 30 June 2015. The parent's directors are responsible for the preparation of these condensed interim consolidated financial statements in accordance with the International Financial Reporting Standard applicable to interim financial reporting (IAS 34), endorsed by the European Union. Our responsibility is to express a conclusion on these condensed interim consolidated financial statements based on our review.
We conducted our review in accordance with Consob (the Italian Commission for Listed Companies and the Stock Exchange) guidelines set out in Consob resolution no. 10867 dated 31 July 1997. A review of condensed interim consolidated financial statements consists of making inquiries, primarily of persons responsible for financial and accounting matters, applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing as adopted in Italy (Italian-ISA) and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion on the condensed interim consolidated financial statements.
Based on our review, nothing has come to our attention that causes us to believe that the condensed interim consolidated financial statements of the Moncler Group as at and for the six months ended 30 June 2015 have not been prepared, in all material respects, in accordance with the International Financial Reporting Standard applicable to interim financial reporting (IAS 34), endorsed by the European Union.
KPMG S.p.A. è una società per azioni di diritto italiano e fa parte del
network KPMG di entità indipendenti affiliate a KPMG International Cooperative ("KPMG International"), entità di diritto svizzero.
Treviso, 31 July 2015
KPMG S.p.A.
(signed on the original)
Francesco Masetto Director of Audit
Ancona Aosta Bari Bergamo Rincola Absta Ball Bergamo
Bologna Bolzano Brescia
Catania Como Firenze Genova
Lecce Milano Napoli Novara Padova Palermo Parma Perugia Pescara Roma Torino Treviso
Trieste Varese Verona
Società per azioni Capitale sociale
Euro 9.179.700,00 i.v Registro Imprese Milano e Codice Fiscale N. 00709600159
R.E.A. Milano N. 512867
Partita IVA 00709600159 VAT number IT00709600159 Sede legale: Via Vittor Pisani, 25
20124 Milano MI ITALIA
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