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Sofina SA Interim / Quarterly Report 2024
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Interim / Quarterly Report
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HALF-YEAR REPORT 2024
Contents
| Our mission | 3 |
|---|---|
| Message to shareholders | 4 |
| Highlights | 6 |
| We are Sofina | 7 |
| Half-year in review | 8 |
| Financial indicators | 9 |
| Portfolio indicators | 10 |
| Sustainability | 14 |
| Post-closing events | 15 |
| Accounts and notes | 16 |
| Glossary | 52 |
| Responsible person | 54 |
Our mission
We aspire to partner with leading entrepreneurs and families, backing them with patient capital and supportive advice to foster sustainable growth of their businesses. Our purpose is to create enduring value, for everyone.
Message to shareholders
Message to shareholders
Dear shareholders,
Sofina returned to growth in the first half of 2024, underscoring our ability to create value and seize opportunities amid an improving environment. At 30 June 2024, our Net Asset Value (NAV), the true measure of our performance, reached EUR 9.5 billion, up from EUR 9.1 billion both at the end of 2023 and in the same period one year ago. This reflects improved momentum across the board, from our investment activity and the opportunities we assess, to the value creation across our portfolio and our ability to generate liquid returns. The underlying operational performance of our portfolio of unlisted companies kept growing solidly, posting 12% average increase in the relevant valuation metric.
We are experiencing the sort of environment in which a growth investor like Sofina can thrive and make a difference. While we are not immune from market sentiment, trading conditions and the macro-economic environment, our main focus remains on long-term, non-cyclical growth through internal, operational dynamics, fuelled by innovation. Our core themes and diversification across sectors and regions remain as relevant as ever, which leads to the overall strength in the portfolio. Across our portfolio of funds, we see the same momentum in investment opportunities. Tech and innovation are at the core, mainly as a driver across sectors and industries.
This diversity and dynamic performance are reflected both in our Top 10 holdings, and in
Harold Boël, Chief Executive Officer
THIS REFLECTS IMPROVED MOMENTUM, FROM OUR INVESTMENT ACTIVITY TO THE VALUE CREATION ACROSS OUR PORTFOLIO AND OUR ABILITY TO GENERATE LIQUID RETURNS.
many long-term minority assets in the portfolio. Cognita, Drylock, ByteDance, Nuxe, and Cambridge Associates are good examples from our Top-10 list, while Vinted or Dailyhunt reflect the strength of the portfolio.
Ongoing liquidity generation and available funds allow us the flexibility to pursue opportunities, like the very recent acquisition of a 4% stake in team.blue, the leading digital enabler for businesses and entrepreneurs across Europe, the closing of our investment in Danish SaaS company EG A/S or follow-on investments in Dott, Vizgen and Rohlik. Our investment team has a strong pipeline of potential deals to pursue.
The general interest in investment opportunities also means we see opportunities to realise returns. We have now fully closed the sale of our remaining stake in Petit Forestier Group. We are proud of our 17-year growth journey together and our fruitful collaboration with the Forestier family. As the company embarks on a new chapter in its development with a renewed shareholding structure, it was an excellent moment for Sofina to crystallise value, in line with our strategy and long-term objectives.
Other positive liquidity events included the further sale of a partial stake in Mamaearth (Honasa Consumer), GL events and Graphcore.
The current moment is also one of opportunity for responsible businesses, with sustainability at their core, and environmental, social and governance targets as part of the strategy and investment case. Sustainability concerns are core in our diligence and in our board mandates. We stand by our belief that innovation, sustainability and long-term growth go hand-in-hand.
This spring we concluded an impact assessment of our Sofina Covid Solidarity Fund, a EUR 20 million commitment to address the adverse consequences of the global health pandemic in two sectors dear to us: healthcare and education. A management committee selected projects that had been vetted by members of our organisation. As in our day-to-day investing, we set a high bar to provide funding. We went through more than 150 projects to select 40 for deep dive reviews and ended up supporting 15 projects in Europe and Southeast Asia. Along with many strong partners in our "philanthropic portfolio", we were able to reach 80 million people and impact their lives. We're proud of this direct and systemic impact. I invite you to read more about this on our website.
The fund's activity reaffirmed that the economic and philanthropical spheres are interconnected, and it also says something about what Sofina is about and how we do things: working together, individuals building genuine relationships and taking charge to achieve impact.
Let me conclude by thanking our Sofina team across the world for their ongoing efforts and success in bringing people together, with purpose. We look forward to keeping up the momentum and continue creating more sustainable value for everyone.
Thank you,
Dominique Lancksweert, Chairman
THIS IS ALSO A TIME OF OPPORTUNITY FOR RESPONSIBLE BUSINESSES, WITH SUSTAINABILITY AT THEIR CORE.
Message to shareholders
Highlights
HIGHLIGHTS
We are Sofina
WE ARE SOFINA
Reliable Dynamic
| We are a family-run investment company with +125 years history |
We offer patient capital, making us a reliable partner through economic cycles |
We are a growth investor, exploring all stages of a company's lifecycle to foster further growth |
We pursue active ownership, offering supportive advice for portfolio companies |
|---|---|---|---|
| We are diversified across sectors, geographies and investment styles |
We are purpose-driven, helping companies build sustainable businesses and embedding ESG in operations and investment decisions |
We look for value creation, delivering competitive long-term returns |
We offer shareholders exposure to hard to access top-tier private businesses |
| We believe in teamwork, bringing together diverse talents with shared values and sector expertise |
We offer strong partnerships building longstanding relationships with like-minded entrepreneurs and investors |
We are agile through our fast decision-making process |
We seek innovation trusting that innovation drives economic and societal progress |
Half-year in review
Half-year in review
Our Net Asset Value of EUR 9.5 billion stems from direct investments as a minority partner of business owners in core growth sectors and indirect funds investments in partnership with an ecosystem of top-tier venture and growth Managers in Europe, the United States, and Asia.
- Financial indicators
- Portfolio indicators
- Sustainability
- Post-closing events
FINANCIAL INDICATORS
Sofina SA adopted the Investment Entity status in application of IFRS 10, §27, which provides that a company, as long as it meets the definition of an Investment Entity, does not consolidate its subsidiaries 1 . In the present Half-year report, the financial statements as an Investment Entity give the fair value of Sofina SA's direct investments (in portfolio investments or in investment subsidiaries). The Net Asset Value ("NAV") reported under the Investment Entity status or in transparency (i.e. considering all portfolio investments whether held by Sofina SA directly or indirectly through its investment subsidiaries) is the same.
Financial statements – Overview of the half year 2
| 30/06/2024 | 31/12/2023 | |
|---|---|---|
| Total assets (in million EUR) | 10,264 | 9,843 |
| Net Asset Value (in million EUR) | 9,509 | 9,083 |
| Net Asset Value per share (in EUR) 3 | 287.00 | 273.62 |
| 1ST SEMESTER 2024 |
1ST SEMESTER 2023 |
|
| Net result (share of the group) (in million EUR) | 551 | 14 |
| Net result (share of the group) per share (in EUR) 4 | 16.59 | 0.42 |
As a reminder, it was resolved at the Annual General Meeting of 8 May 2024 that a gross dividend of EUR 3.35 per share would be paid.
Financial figures in transparency 5 (in million EUR)
| KEY FIGURES IN TRANSPARENCY | 30/06/2024 | 31/12/2023 |
|---|---|---|
| Net debt (+) / Net cash (-) | -11 | -197 |
| Investment portfolio | 9,588 | 8,928 |
| Loan-to-value (in %) | -0.1% | -2.2% |
| KEY COMPREHENSIVE INCOME FIGURES IN TRANSPARENCY | 1ST SEMESTER 2024 |
1ST SEMESTER 2023 |
| Dividends | 25 | 23 |
| Net result of the investment portfolio | 564 | 12 |
| Total comprehensive income 6 | 551 | 14 |
KEY CASH FLOW STATEMENT FIGURES IN TRANSPARENCY 1ST SEMESTER 2024 1ST SEMESTER 2023 Investments in portfolio -413 -244 Divestments from portfolio 343 240 BALANCE SHEET IN TRANSPARENCY 30/06/2024 31/12/2023 Investment portfolio 9,588 8,928 Sofina Direct 5,190 4,739 Long-term minority investments 3,270 2,847 Sofina Growth 1,920 1,892 Sofina Private Funds 4,398 4,189 Net cash 11 197 Gross cash 708 893 Financial liabilities -697 -696 Other -89 -42 NAV 9,509 9,083
EVOLUTION OF THE SHARE PRICE AND THE NAV PER SHARE (IN EUR) 7
1 For a definition of the different terms, see the Glossary.
- 2 The interim consolidated financial statements are presented under the Investment Entity status in application of which direct subsidiaries of Sofina SA are stated at fair value, including the fair value of their equity investments and other assets and liabilities (mainly intra-group debts and receivables), through profit and loss. For further explanation, see the Glossary.
- 3 Calculation based on the number of outstanding shares at closing date (33,132,976 shares at 30 June 2024 and 33,197,072 at 31 December 2023).
- 4 Calculation based on the weighted average number of outstanding shares (33,198,551 shares at 30 June 2024 and 33,330,492 shares at 30 June 2023).
5 Based on the portfolio in transparency (see point 2.1 of the Notes to the interim condensed consolidated financial statements). For a definition of the different terms, see the Glossary.
- 6 The small difference between the net result and the total comprehensive income comes from income and expenses recognised directly in the shareholders' equity and subsequently reclassified in the net result.
- 7 Data at 31 December, except for 2024 which provides for data at 30 June. The financial data at 31 December have been prepared under IFRS standards since the financial year ending 31 December 2004. Figures relating to 2016 and 2017 have been restated in accordance with IAS 28, §18 to ensure that the Net Asset Value for 2016 and 2017 can be compared with that of the following years as set up under the Investment Entity status.
• Portfolio indicators
PORTFOLIO INDICATORS
Portfolio overview1
1 Based on the fair value of the Sofina group's investments at 30 June 2024 (portfolio in transparency).
2 Vintage based on the date of first investment or capital call.
Message to shareholders
Sofina Direct
Our Long-term minority investments and Sofina Growth, our earlier stage direct investments, are grouped under Sofina Direct. This portfolio includes investments in a variety of sectors, business models and geographies at different stages of maturity.
Top 10 of Sofina Direct 1
The top 10 Sofina Direct portfolio positions illustrate strength of Sofina's relationship with top-tier companies globally.
| 1 | PETIT FORESTIER GROUP |
|---|---|
| 2 | LERNEN MIDCO 1 (COGNITA) |
| 3 | DRYLOCK TECHNOLOGIES |
| 4 | HSG CO-INVESTMENT 2016-A (BYTEDANCE) |
| 5 | NUXE INTERNATIONAL |
| 6 | CAMBRIDGE ASSOCIATES |
| 7 | BIOMÉRIEUX |
| 8 | MNH (MÉRIEUX NUTRISCIENCES) |
| 9 | BIOBEST GROUP (BIOFIRST) 2 |
10 SALTO SYSTEMS
The 10 largest investments of Sofina Direct represent 30% of the fair value of the portfolio in transparency.
The 4 largest investments of Sofina Direct represent more than 15% but less than 20% of the portfolio in transparency whereas the 6 largest investments represent more than 20% of the portfolio in transparency 1.
Out of the above-listed investments taken individually, when taking into account our combined holdings through Sofina Direct and Sofina Private Funds 3 when applicable, Petit Forestier Group4 and ByteDance5 are the sole assets representing more than 5% of the fair value of the portfolio in transparency 1.
Long-term minority investments
Sofina Growth
1 Largest investments in terms of representation in the fair value of the portfolio in transparency and following the valuation principles set in point 2.3 of the Notes to the interim condensed consolidated financial statements. Listed in decreasing order of fair value at 30 June 2024. The ranking of our Sofina Direct investments does not take into consideration indirect holdings in these entities through certain investments of Sofina Private Funds.
- 2 Biobest Group (BioFirst) regroups Biobest Group SA and MxBEE, an investment vehicle whose sole asset is a shareholding in Biobest Group SA. The ranking therefore consists of the fair value in transparency of Biobest Group SA and MxBEE.
- 3 The valuation of such investments through Sofina Private Funds is based either on a report at 30 June 2024 or on a report at 31 March 2024.
- 4 Sofina values its holding in Petit Forestier Group on the basis of the sales price. The holding is still in our Top-10 in this overview since closing only took place after 30 June 2024.
- 5 Sofina values its holding in HSC Co-Investment 2016-A on the basis of the market multiples valuation method with an illiquidity discount. Its holding in ByteDance at Sofina Private Funds level is valued on the basis of the latest reports (where the information is available) obtained from the General Partners.
- 6 Based on the fair value of the Sofina group's investments at 30 June 2024 (portfolio in transparency).
Sofina Private Funds
Sofina Private Funds relies on building long-term partnerships with carefully selected General Partners managing mainly venture and growth capital funds.
Top 10 of Sofina Private Funds1
The 10 largest General Partners of Sofina Private Funds represent 22% of the fair value of the portfolio in transparency.
| 1 | SEQUOIA |
|---|---|
| 2 | HONGSHAN |
| 3 | LIGHTSPEED |
| 4 | PEAK XV |
| 5 | INSIGHT |
| 6 | BATTERY |
| 7 | THOMA BRAVO |
| 8 | ICONIQ |
| 9 | TA ASSOCIATES |
| 10 | ANDREESSEN HOROWITZ |
SPLIT BY STRATEGY
Sofina Private Funds portfolio has always favoured venture capital and growth equity funds, mostly because of the risk-return profile of their strategy and their resonance with Sofina's DNA. These funds are generally invested in companies where founders are still shareholders and present in management, unlike acquisition targets where financial investors take control of the company ("leveraged buyout" or "LBO"). This bias explains the current exposure of the Sofina Private Funds portfolio to those strategies 2.
SPLIT BY GEOGRAPHIC REGION
The United States remain the most developed market for venture capital and growth equity funds, as reflected in Sofina Private Funds portfolio with a relatively high exposure to this region (64% in 2024).
To keep its geographic footprint diversified and capitalise on high-growth sectors and regions, Sofina Private Funds' exposure to Asia has been steady trough H1 2024. Sofina can thus benefit from the trends identified by its Managers in this region: growth of the middle class and rapid urbanisation.
The Sofina Private Funds portfolio continued to strengthen in European venture capital and growth equity funds, thus aligning with the group's strategy.
In addition, by focusing on venture capital and growth equity funds as well as the geographical footprint of its portfolio, Sofina benefits from global exposure to its sectors of focus: Consumer and retail, Digital transformation, Education, Healthcare and life sciences, and Sustainable supply chains.
CONCENTRATION BY MANAGER
Over the last decade, Sofina Private Funds portfolio concentration has decreased, even though the top 20 Managers still represent more than 63% of this portfolio. Moreover, while Sofina rigorously monitors the performance of its Managers, its policy is to maintain long-term relationships with them.
Currently, the main Managers are Andreessen Horowitz, Atomico, Bain, Battery, DST, General Atlantic, HongShan, Iconiq, Insight, Lightspeed, NEA, Peak XV, Redpoint, Sequoia, Source Code, Spark, TA Associates, Thoma Bravo, Thrive and Venrock.
1 Largest General Partners in terms of estimated representation of their funds in the fair value of Sofina's portfolio in transparency. Listed in decreasing order of fair value at 30 June 2024.
2 Definitions of the different private funds strategies :
Venture capital is composed of investments in high-growth companies supporting entrepreneurial ventures, start-ups and scale-ups. It is divided into different stages, with Seed and Series A usually classified as early-stage (investments to build the company, launch products and find product-market fit), and Series B and beyond being classified as late-stage (capital to help the company scale).
Growth equity generally refers to investments in middle-market businesses with high organic growth rates, more established business models and often positive cash flow. They have often reached this stage without institutional funding (i.e. bootstrapped).
Leveraged buyout (LBO) refers to acquisitions of companies at different stages or maturities. Given the control element, buyout funds often make major operational adjustments to these companies to create value.
Message to shareholders
Investments & Divestments in H1 2024
Biobest
EG A/S
Additional investment in Biobest (BioFirst), a global leader in biological crop protection, nutrition, and natural pollination, committed to supporting sustainable production of high-value crops with reliability and expertise.
Investment in the leading Nordic Software as a Service company EG A/S, that offers industry-specific solutions that optimise critical business operations with deep sector expertise.
Lyskraft (Meraki Labs)
Investment in Lyskraft, a company redefining the Indian fashion landscape with a curated omnichannel platform, becoming the leading destination for premium women's fashion and accessories across multiple brands.
Continued our support for Medgenome a global leader in genomics-driven diagnostics and research. Medgenome is offering advanced sequencing and bioinformatics solutions with a mission to improve global health.
Participation in a new funding round for Mistral AI, a European start-up focused on developing fast, secure, and open-source generative AI models tailored for business use, combining scientific excellence with a global vision.
Rohlik Expanded our investment in Rohlik, the European e-grocery leader, redefining the grocery industry with fast delivery, a broad selection of products, and a commitment
to high food quality and service standards.
Dott
A smaller add-on investment in Dott, which provides shared e-scooters and e-bikes to help cities reduce car dependency and promote sustainable transportation.
Vizgen
Further invested in Vizgen, a life science company pioneering spatial genomics technology, enabling single-cell resolution mapping of genomic information. Their platform reveals genetic patterns, advancing our understanding of disease and enabling novel therapies.
Investments Divestments
has evolved into a leading retail group, employing over 33,000 people and serving communities across three countries.
Sale of the stake in Polygone, the holding company above GL events. Additionally, shares in GL events, a key player in the global events industry, were also sold. GL events specialises in organising and hosting congresses, conventions, trade shows, and cultural or political events, serving both public and private clients
GL events
worldwide.
Full divestment of our stake in Colruyt Group, a Belgian family business that
A partial exit in Sibelco, the global material solutions company specialising in the mining, processing, and sale of industrial minerals such as silica, clays, feldspathics, and olivine.
Mamaearth
Sibelco
Sale of an additional part of our stake in Mamaearth (Honasa Consumer), an Indian brand specialising in natural, toxin-free beauty and baby care products.
ByteDance
Partial monetisation of ByteDance, a Chinese internet and technology company with global footprint, known for its leading consumer apps like TikTok and Douyin.
Message to shareholders
We are Sofina
- Financial indicators
- Portfolio indicators
- Sustainability
- Post-closing events
SUSTAINABILITY
Recent focus on climate change
Climate change exacerbates other societal challenges. This year, we are accelerating our efforts to transition our operations and portfolio in alignment with a 1.5° C trajectory.
On our operations:
- We established roadmaps to reduce our scope 1 and 2 emissions by 2030 in line with a 1.5° C pathway by measures such as updating our mobility policy and further assessing ways to reduce energy consumption in our offices.
- Business travel related emissions are our biggest operational footprint. Earlier this year, we updated our sustainable travel policy with the aim to keep our per FTE business travel emissions at 2023 level.
On our portfolio:
- We are engaging our portfolio about climate risks and climate impacts, specifically via their commitment to the Science Based Targets initiative.
- We linked a target to increase the % invested capital covered by SBTi approved companies in Sofina Direct to 20% of our Long-term incentive plan (LTIP).
7%
OF TOTAL INVESTED CAPITAL IN SOFINA DIRECT PORTFOLIO COMPANIES HAVING SCIENCE BASED TARGETS (AT 1 SEPT. 2024)
20% OF LTIP LINKED TO PORTFOLIO SBTI COVERAGE TARGET
24
roadmaps.
100%
INVESTMENT OPPORTUNITIES IN SOFINA DIRECT HAVE BEEN ASSESSED IN ACCORDANCE WITH THE ESG DUE DILIGENCE FRAMEWORK
MANAGERS IN SOFINA PRIVATE FUNDS HAVING AN ESG POLICY
16 PORTFOLIO COMPANIES IN SOFINA DIRECT WITH A
SUSTAINABILITY ROADMAP
35
PORTFOLIO COMPANIES IN WHICH WE HAVE A BOARD SEAT
Commitment to people & ethics
We continue to promote diversity, equity, and inclusion in the workplace as well as the wellbeing and personal development of our employees. We further apply the best governance practices and maintain high standards of compliance, ethics and integrity.
We understand the equal importance of other environmental, social and governance issues, and are addressing those through our ESG due diligence and sustainability
- Message to shareholders
- Highlights
- We are Sofina
- Half-year in review
- Financial indicators
- Portfolio indicators
- Sustainability
- Post-closing events
- Accounts and notes
- Glossary
- Responsible person
POST-CLOSING EVENTS
Since the end of June 2024, we have continued investing and divesting. Highlights include the investment in July, subject to closing conditions, in team.blue, and another new addition to our investment portfolio: Vivobarefoot. The full divestment of our remaining stake in Petit Forestier Group is fully closed since early September. We also exited our stake in Graphcore.
Investments Divestments
NEW DEAL LONG-TERM MINORITY BELGIUM DIGITAL TRANSFORMATION
Signing of an agreement to acquire a 4% stake in team.blue, a leading digital enabler in Europe, providing web hosting and digital services to over 2 million customers.
First investment in Vivobarefoot, a leading brand in barefoot and natural health. Vivobarefoot's mission is to connect people with nature through industry-leading barefoot footwear and experiences.
FULL EXIT
LONG-TERM MINORITY UNITED KINGDOM DIGITAL TRANSFORMATION
Exit from and application of our liquidation preference in Graphcore, a British semiconductor company that designs advanced microprocessors, known as Intelligence Processing Units (IPUs), for AI and machine learning.
Full divestment of our remaining stake in Petit Forestier Group, the European leader in refrigeration rental, including vehicles, display units, and containers.
Accounts and notes
Highlights
Half-year in review
Accounts and notes
- Consolidated financial statements
- • Notes to the consolidated financial statements
- • Independent auditor's report
Interim condensed consolidated financial statements with notes and independent auditor's report
Download as PDF to print out SOFINA 16 HALF-YEAR REPORT 2024
Accounts and notes
- Consolidated financial statements
- • Notes to the consolidated financial statements
- • Independent auditor's report
INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS AT 30 JUNE 2024
Sofina meets the conditions for Investment Entity status under IFRS 10, §27, which requires that investment subsidiaries should not be consolidated and that direct subsidiaries of a company that qualifies as an Investment Entity should be recorded at fair value in the consolidated financial statements, including the fair value of their equity investments and their other assets and liabilities.
Consolidated balance sheet
| IN THOUSAND EUR | ||||
|---|---|---|---|---|
| NOTES | 30/06/2024 | 31/12/2023 | ||
| 9,576,777 | 8,619,370 | |||
| 8,713 | 8,926 | |||
| 3.1 | 9,568,064 | 8,610,444 | ||
| 9,503,637 | 8,548,378 | |||
| 64,427 | 62,066 | |||
| 0 | 0 | |||
| 687,712 | 1,223,563 | |||
| 3.3 | 475,376 | 527,970 | ||
| 3.8 | 75,736 | 495,153 | ||
| 97 | 101 | |||
| 1,071 | 1,997 | |||
| 3.4 | 135,432 | 198,342 | ||
| 10,264,489 | 9,842,933 | |||
| IN THOUSAND EUR | |||
|---|---|---|---|
| LIABILITIES | NOTES | 30/06/2024 | 31/12/2023 |
| Shareholders' equity | 9,509,303 | 9,083,431 | |
| Share capital | 3.5 | 79,735 | 79,735 |
| Share premium | 4,420 | 4,420 | |
| Reserves | 9,425,148 | 8,999,276 | |
| Non-current liabilities | 697,428 | 697,017 | |
| Provisions for pensions | 674 | 675 | |
| Other provisions | 75 | 53 | |
| Non-current financial liabilities | 3.6 | 696,679 | 696,289 |
| Deferred tax liabilities | 0 | 0 | |
| Current liabilities | 57,758 | 62,485 | |
| Current financial liabilities | 3.7 | 5,370 | 2,109 |
| Payables to subsidiaries | 3.8 | 2,514 | 55,980 |
| Trade and other current payables | 3.7 | 49,874 | 4,396 |
| Taxes | 0 | 0 | |
| TOTAL LIABILITIES | 10,264,489 | 9,842,933 |
| Our mission |
|---|
| Message to shareholders |
| Highlights |
| We are Sofina |
| Half-year in review |
| Accounts and notes |
| • Consolidated financial |
| statements |
| financial statements |
| • Notes to the consolidated • Independent auditor's report |
Consolidated income statement
| IN THOUSAND EUR | ||||
|---|---|---|---|---|
| NOTES | 1ST SEMESTER 2024 | 1ST SEMESTER 2023 | ||
| Dividend income | 3.9 | 824,403 | 11,736 | |
| Interest income | 3.10 | 12,717 | 14,302 | |
| Interest expenses | 3.10 | −4,233 | −3,858 −379 |
|
| Net result of the investment portfolio | 3.1 & 3.11 | −261,751 | ||
| Investments | −263,703 | −379 | ||
| Gains | 447,774 | 218,968 | ||
| Losses | −711,477 | −219,347 | ||
| Receivables | 1,952 | 0 | ||
| Gains | 1,952 | 0 | ||
| Losses | 0 | 0 | ||
| Other financial results 3.12 |
10,576 | 9,336 | ||
| Other income | 1,038 | 936 | ||
| Other expenses 3.13 |
−31,822 | −17,988 | ||
| RESULT BEFORE TAX | 550,929 | 14,085 | ||
| Taxes | −4 | −4 | ||
| RESULT FOR THE PERIOD | 550,925 | 14,081 | ||
| SHARE OF THE GROUP IN THE RESULT | 550,925 | 14,081 | ||
| Net result per share (EUR) 1 | 16.5948 | 0.4225 | ||
| Diluted net result per share (EUR) 2 | 16.2527 | 0.4200 |
Consolidated statement of comprehensive income
| IN THOUSAND EUR | ||||
|---|---|---|---|---|
| NOTES | 1ST SEMESTER 2024 | 1ST SEMESTER 2023 | ||
| RESULT FOR THE PERIOD | 550,925 | 14,081 | ||
| OTHER COMPREHENSIVE INCOME 3 | ||||
| Other items | 0 | 0 | ||
| Income and expenses recognised directly in shareholders' equity and subsequently reclassified to net revenue |
0 | 0 | ||
| Income and expenses recognised directly in shareholders' equity and subsequently not reclassified to net revenue |
0 | 0 | ||
| TOTAL OTHER COMPREHENSIVE INCOME 3 | 0 | 0 | ||
| TOTAL RECOGNISED INCOME AND EXPENSES (COMPREHENSIVE INCOME) |
550,925 | 14,081 | ||
| ATTRIBUTABLE TO NON-CONTROLLING INTERESTS |
0 | 0 | ||
| Attributable to shareholders of the parent company |
550,925 | 14,081 |
1 Calculation based on the weighted average number of outstanding shares (33,198,551 shares as at 30 June 2024 and 33,330,492 shares as at 30 June 2023, i.e. a net change in treasury shares of -131,941).
2 Calculation based on the weighted average number of outstanding shares diluted per share (33,897,442 shares as at 30 June 2024 and 33,524,042 shares as at 30 June 2023 i.e. a net change in treasury shares of +373,400).
3 These items are presented net of taxes.
Message to shareholders Highlights
Accounts and notes
• Consolidated financial statements
• Notes to the consolidated financial statements
• Independent auditor's report
Changes in the consolidated shareholders' equity
| IN THOUSAND EUR | ||||||||
|---|---|---|---|---|---|---|---|---|
| NOTES | SHARE CAPITAL | SHARE PREMIUM | RESERVES | TREASURY SHARES | GROUP'S SHARE | NON-CONTROLLING INTEREST |
TOTAL | |
| BALANCE AS AT 31/12/2022 | 79,735 | 4,420 | 9,521,570 | −292,396 | 9,313,329 | 0 | 9,313,329 | |
| Result for the period | 14,081 | 14,081 | 14,081 | |||||
| Other comprehensive income | 0 | 0 | 0 | |||||
| Dividends paid | −108,023 | −108,023 | −108,023 | |||||
| Changes in treasury shares | −222 | −8,635 | −8,857 | −8,857 | ||||
| Other | 4,045 | 4,045 | 4,045 | |||||
| Changes in non-controlling interests | 0 | 0 | ||||||
| BALANCE AS AT 30/06/2023 | 79,735 | 4,420 | 9,431,451 | −301,031 | 9,214,575 | 0 | 9,214,575 | |
| BALANCE AS AT 31/12/2023 | 79,735 | 4,420 | 9,317,893 | −318,617 | 9,083,431 | 0 | 9,083,431 | |
| Result for the period | 550,925 | 550,925 | 550,925 | |||||
| Other comprehensive income | 0 | 0 | 0 | |||||
| Dividends paid | 3.5 | −111,236 | −111,236 | −111,236 | ||||
| Changes in treasury shares | −2,382 | −16,404 | −18,786 | −18,786 | ||||
| Other | 4,969 | 4,969 | 4,969 | |||||
| Changes in non-controlling interest | 0 | 0 | ||||||
| BALANCE AS AT 30/06/2024 | 79,735 | 4,420 | 9,760,169 | −335,021 | 9,509,303 | 0 | 9,509,303 |
Consolidated cash flow statement
| NOTES | 1ST SEMESTER 2024 |
1ST SEMESTER 2023 |
|
|---|---|---|---|
| Our mission | CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE PERIOD 3.4 |
198,342 | 385,486 |
| Message to shareholders | Dividend income | 113,063 | 16,746 |
| Interest income | 3,933 | 14,269 | |
| Highlights | Interest expenses | −168 | −586 |
| Acquisitions of current financial assets (deposits of more than 3 months) | −75,000 | 0 | |
| We are Sofina | Disposals of current financial assets (deposits of more than 3 months) | 0 | 0 |
| Half-year in review | Acquisitions of current financial assets (treasury investment portfolio) | −57,273 | −145,800 |
| Disposals of current financial assets (treasury investment portfolio) | 194,028 | 0 | |
| Accounts and notes | Acquisitions of other current financial assets | −184 | 0 |
| • Consolidated financial | Disposals of other current financial assets | 176 | 150 |
| statements | Other current receipts | 3,337 | 6,690 |
| Administrative expenses and miscellaneous | −19,574 | −17,927 | |
| • Notes to the consolidated | Net taxes | −8 | −7 |
| financial statements | Cash flow from operating activities | 162,330 | −126,465 |
| Acquisitions of (in)tangible assets | −122 | −119 | |
| • Independent auditor's report Glossary |
Disposals of (in)tangible assets | 1 | 0 |
| Disposals of consolidated companies | 0 | 0 | |
| Investments in portfolio 3.1 |
−356,837 | −59,787 | |
| Divestments from portfolio 3.1 & 3.11 |
185,672 | 96,749 | |
| Responsible person | Movements in other non-current assets | 0 | 0 |
| Cash flow from investing activities | −171,286 | 36,843 | |
| Acquisitions of treasury shares | −28,837 | −9,997 | |
| Disposals of treasury shares | 18,366 | 1,140 | |
| Dividends paid 3.5 |
−111,236 | −108,027 | |
| Movements in receivables from subsidiaries | 64,804 | 66,843 | |
| Movements in payables to subsidiaries | 2,949 | −150,175 | |
| Receipts from financial liabilities | 40,000 | 0 | |
| Repayments of financial liabilities | −40,000 | 0 | |
| Cash flow from financing activities | −53,954 | −200,216 | |
| CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD 3.4 |
135,432 | 95,648 |
For Sofina, the primary revenue generator is the evolution of the NAV (a non-monetary item that appears in the income statement but not in the consolidated cash flow statement). In this context, cash flows related to portfolio investments and divestments, which are not revenue generators, are considered to be part of investing activities and not of operating activities.
For additional information, the management cash flow statement (in transparency) is available in point 2.1 of the Notes to the interim condensed consolidated financial statements.
IN THOUSAND EUR
Accounts and notes
- Consolidated financial statements
- Notes to the consolidated financial statements
• Independent auditor's report
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The notes to the interim consolidated financial statements are grouped in three sections, providing the following information:
- 1. Statement of compliance and accounting policies – includes the statement of compliance, accounting policies and significant changes.
- 2. Key management information and segment reporting – includes segment information and reconciliations to the financial statements as well as information on the portfolio in transparency (as if the group were applying the consolidation principles).
- 3. Notes to the financial statements as an Investment Entity – includes the notes to the interim consolidated financial statements of Sofina as an Investment Entity.
1. Statement of compliance and accounting principles
Sofina SA is a public limited liability company incorporated under Belgian law, with its registered office at rue de l'Industrie, 31, 1040 Brussels.
The interim condensed consolidated financial statements of the Sofina group as at 30 June 2024 have been approved by the Board of Directors held on 5 September 2024, have been prepared in accordance with IFRS (International Financial Reporting Standards) as adopted in the European Union and have been prepared in accordance with IAS 34 - Interim Financial Reporting.
These interim condensed consolidated financial statements do not include all the information required for complete financial statements. Accordingly, they should be read in conjunction with the information provided in the Annual report containing the consolidated financial statements as at 31 December 2023.
ACCOUNTING PRINCIPLES
The standards, amendments and interpretations published but not yet effective in 2024 have not been adopted in advance by the Sofina group (see point 3.18 below).
The valuation and consolidation principles, methods and techniques used in these interim condensed consolidated financial statements are identical to those applied by the Sofina group when preparing the consolidated financial statements for the year ended 31 December 2023.
A summary of the main accounting policies is presented in point 3.18 below.
2. Key management information and segment reporting
2.1 SEGMENT INFORMATION - RECONCILIATION WITH FINANCIAL STATEMENTS
IFRS 8 on operating segments requires Sofina to present segments on the basis of reports presented to management for the purpose of making decisions about resources to be allocated to each segment and assessing the performance of each segment.
Sofina SA is the parent company of the Sofina group. The investments in portfolio managed by the group are held by the parent company, Sofina SA, either by owning shares directly in portfolio investments or by investing in them through its investment subsidiaries. When preparing the financial statements as an Investment Entity, the fair value of the shares held directly at the parent company level (in portfolio investments or in investment subsidiaries) is recorded as an asset in the balance sheet. By contrast, segment management information (based on internal reporting) is prepared on the entire portfolio in transparency (i.e. on all portfolio investments wherever they are held in the Sofina group legal structure), and thus on the basis of the total fair value of each portfolio investment ultimately held in companies or in funds. The presentation of dividends or cash flows follows the same logic.
To reconcile the items related to the group's total portfolio with the financial statements, the information is presented as follows:
• Total – which represents the total of the investment portfolio (the total of the three investment styles covered by Sofina Direct and Sofina Private Funds) on the one hand and the items not allocated to the investment styles (i.e. expenses and income or other balance sheet items not monitored in a segmented way per investment style), whether they are recognised at the parent company level or in the subsidiaries of Sofina SA, on the other;
• Items for reconciliation with the financial statements – which represent the adjustments necessary to reconcile the details per investment style (as used internally in the day-to-day management of the Sofina group) with the consolidated financial statements under Investment Entity status. These consist of reclassifications between both views of the portfolio (in transparency or not), as explained in point 2.3 below;
• Financial statements – which represent the consolidated financial statements under the Investment Entity status.
The presentation of the comprehensive income and the balance sheet is aggregated as it appears in the reports to management. Definitions of terms can be found in the Glossary at the end of this Half-year report.
| Our mission |
|---|
Accounts and notes
• Consolidated financial statements
• Notes to the consolidated
financial statements
• Independent auditor's report
| SITUATION AS AT 30 JUNE 2024 | |||||||
|---|---|---|---|---|---|---|---|
| -- | -- | -- | ------------------------------ | -- | -- | -- | -- |
| IN THOUSAND EUR | |||||
|---|---|---|---|---|---|
| COMPREHENSIVE INCOME (1ST SEMESTER 2024) | SOFINA DIRECT | SOFINA PRIVATE FUNDS | TOTAL | RECONCILING ITEMS | FINANCIAL STATEMENTS |
| Dividends | 25,413 | 0 | 25,413 | 798,990 | 824,403 |
| Long-term minority investments | 25,413 | ||||
| Sofina Growth | 0 | ||||
| Net result of the investment portfolio | 404,812 | 158,702 | 563,514 | −825,265 | −261,751 |
| Long-term minority investments | 379,393 | ||||
| Sofina Growth | 25,419 | ||||
| Management expenses | −38,640 | 6,818 | −31,822 | ||
| Other 1 | 638 | 19,457 | 20,095 | ||
| Total comprehensive income | 550,925 | 0 | 550,925 | ||
| BALANCE SHEET (30/06/2024) | SOFINA DIRECT | SOFINA PRIVATE FUNDS | TOTAL | RECONCILING ITEMS | IN THOUSAND EUR FINANCIAL STATEMENTS |
| Investment portfolio | 5,189,930 | 4,397,625 | 9,587,555 | −19,491 | 9,568,064 |
| Long-term minority investments | 3,270,187 | ||||
| Sofina Growth | 1,919,743 | ||||
| Net cash | 10,964 | −108,734 | −97,770 | ||
| Gross cash | 707,643 | −108,734 | 598,909 | ||
| Financial liabilities | −696,679 | 0 | −696,679 | ||
| (In)tangible fixed assets | 10,691 | −1,978 | 8,713 | ||
| Other assets and liabilities 1 | −99,907 | 130,203 | 30,296 | ||
| NAV | 9,509,303 | 0 | 9,509,303 |
1 This includes the deferred tax liabilities (EUR 13.99 million in the comprehensive income representing a total amount of EUR 51.06 million in the liabilities) for the temporary tax differences recognised by some investment subsidiaries between the carrying amount and the tax base of portfolio investments impacting their fair value recognised in Sofina SA's investment portfolio. Moreover, there are accumulated profits within the investment subsidiaries holding Sofina Private Funds which could become taxable at a 25% tax rate in the theoretical scenario where the relevant investment subsidiaries holding such portfolio were to be liquidated and profit repatriated to Sofina SA, which will however not materialise in the current going-concern context. Depending on the theoretical scenarios considered (such as a sale or a liquidation of Sofina Private Funds), 0% to 60% of the Net Asset Value of the investment subsidiaries holding Sofina Private Funds could become taxable at 25%. However, this hypothetical tax has not been recognised because the trigger events are under the control of Sofina SA, and moreover not probable. Furthermore, the investment subsidiaries of Sofina SA do not recognise deferred tax assets for tax losses carried forward because their recovery is not considered probable. Here also, since there is no deferred tax asset recognised by the investment subsidiaries in this respect, their fair value is not impacted.
Accounts and notes
• Consolidated financial statements
• Notes to the consolidated financial statements
• Independent auditor's report
The management cash flow statement below provides cash flow information in transparency for all group subsidiaries.
| IN THOUSAND EUR | |||||
|---|---|---|---|---|---|
| MANAGEMENT CASH FLOW STATEMENT (1ST SEMESTER 2024) | SOFINA DIRECT | TOTAL GROSS CASH | FINANCIAL LIABILITIES | TOTAL NET CASH | |
| Net cash at the beginning of the period | 893,590 | −696,289 | 197,301 | ||
| Dividends 1 | 15,000 | 0 | 15,000 | 0 | 15,000 |
| Management expenses 2 | −22,354 | 0 | −22,354 | ||
| Investments in portfolio | −236,768 | −176,586 | −413,354 | 0 | −413,354 |
| Divestments from portfolio | 219,477 | 123,480 | 342,957 | 0 | 342,957 |
| Dividends paid | −111,236 | 0 | −111,236 | ||
| Other items | 3,040 | −390 | 2,650 | ||
| Repayment of financial liabilities | 0 | 0 | 0 | ||
| Net cash at the end of the period | 707,643 | −696,679 | 10,964 |
| IN THOUSAND EUR | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| INVESTMENT PORTFOLIO BRIDGE (1ST SEMESTER 2024) |
FAIR VALUE AT 31/12/2023 |
INVESTMENTS 3 | DIVESTMENTS 3 AND REVENUES | MARKET | FX IMPACT FAIR VALUE AT | VALUE CREATION | |||
| CASH | NON-CASH 5 | CASH | NON-CASH 5 | IMPACT | 30/06/2024 | % 4 | |||
| Sofina Direct | 4,739,235 | 218,120 | 71 | −214,202 | −12,813 | 384,590 | 74,929 | 5,189,930 | 9% |
| Sofina Private Funds | 4,189,006 | 171,388 | 8,143 | −123,480 | −6,135 | 30,621 | 128,082 | 4,397,625 | 4% |
| Total Investment portfolio | 8,928,241 | 389,508 | 8,214 | −337,682 | −18,948 | 415,211 | 203,011 | 9,587,555 | 7% |
1 Difference compared with the dividends presented in the comprehensive income is mainly due to cut-offs between declaration and payment periods or to withholding taxes.
2 Difference compared with the management expenses presented in the comprehensive income is mainly due to the non-cash expenses associated with debts towards suppliers and stock option plans granted.
3 Net of intragroup transfers.
4 (Fair value at the end of the year + Divestments and revenues of the year) divided by (Fair value at the beginning of the year + Investments of the year).
5 Mainly composed of non-cash re-investments of exit proceeds, escrows and cut-offs (i.e. differences when the realisation of a transaction and its cash impact occur in two different financial years).
Accounts and notes
• Consolidated financial statements
• Notes to the consolidated financial statements
• Independent auditor's report
| SITUATION AS AT 30 JUNE 2023 | ||||
|---|---|---|---|---|
| IN THOUSAND EUR | |||||
|---|---|---|---|---|---|
| COMPREHENSIVE INCOME (1ST SEMESTER 2023) | SOFINA DIRECT SOFINA PRIVATE FUNDS | TOTAL | RECONCILING ITEMS | FINANCIAL STATEMENTS | |
| Dividends | 22,553 | 146 | 22,699 | −10,963 | 11,736 |
| Long-term minority investments | 22,553 | ||||
| Sofina Growth | 0 | ||||
| Net result of the investment portfolio | 127,582 | −115,910 | 11,672 | −12,051 | −379 |
| Long-term minority investments | 50,805 | ||||
| Sofina Growth | 76,777 | ||||
| Management expenses | −25,322 | 7,334 | −17,988 | ||
| Other 1 | 5,032 | 15,680 | 20,712 | ||
| Total comprehensive income | 14,081 | 0 | 14,081 | ||
| IN THOUSAND EUR | |||||
|---|---|---|---|---|---|
| BALANCE SHEET (30/06/2023) | SOFINA DIRECT SOFINA PRIVATE FUNDS | TOTAL | RECONCILING ITEMS | FINANCIAL STATEMENTS | |
| Investment portfolio | 4,847,242 | 4,213,924 | 9,061,166 | -558,489 | 8,502,677 |
| Long-term minority investments | 2,811,356 | ||||
| Sofina Growth | 2,035,886 | ||||
| Net cash | 122,704 | -135,820 | -13,116 | ||
| Gross cash | 818,598 | -135,820 | 682,778 | ||
| Financial liabilities | −695,894 | 0 | -695,894 | ||
| (In)tangible fixed assets | 10,491 | -1,560 | 8,931 | ||
| Other assets and liabilities 1 | 20,214 | 695,869 | 716,083 | ||
| NAV | 9,214,575 | 0 | 9,214,575 |
1 This includes the deferred tax liabilities (of EUR 2.17 million) for the temporary tax differences recognised by some investment subsidiaries between the carrying amount and the tax base of portfolio investments impacting their fair value recognised in Sofina SA's investment portfolio. Moreover, there are accumulated profits within the investment subsidiaries holding Sofina Private Funds which could become taxable at a 25% tax rate in the theoretical scenario where the relevant investment subsidiaries holding such portfolio were to be liquidated and profit repatriated to Sofina SA, which will however not materialise in the current going-concern context. Depending on the theoretical scenarios considered (such as a sale or a liquidation of Sofina Private Funds), 0% to 60% of the Net Asset Value of the investment subsidiaries holding Sofina Private Funds could become taxable at 25%. However, this hypothetical tax has not been recognised because the trigger events are under the control of Sofina SA, and moreover not probable. Furthermore, the investment subsidiaries of Sofina SA do not recognise deferred tax assets for tax losses carried forward because their recovery is not considered probable. Here also, since there is no deferred tax asset recognised by the investment subsidiaries in this respect, their fair value is not impacted.
Accounts and notes
• Consolidated financial statements
• Notes to the consolidated financial statements
• Independent auditor's report
| The management cash flow statement below provides cash flow information in transparency for all group subsidiaries. | |
|---|---|
| IN THOUSAND EUR | |||||
|---|---|---|---|---|---|
| MANAGEMENT CASH FLOW STATEMENT (1ST SEMESTER 2023) | SOFINA DIRECT SOFINA PRIVATE FUNDS | TOTAL GROSS CASH | FINANCIAL LIABILITIES | TOTAL NET CASH | |
| Net cash at the beginning the period | 928,558 | −695,507 | 233,051 | ||
| Dividends 1 | 15,956 | 146 | 16,102 | 16,102 | |
| Management expenses 2 | −25,761 | −25,761 | |||
| Investments in portfolio | −84,764 | −158,981 | −243,745 | −243,745 | |
| Divestments from portfolio | 123,754 | 116,119 | 239,873 | 239,873 | |
| Dividends paid | −108,027 | −108,027 | |||
| Other items | 11,598 | −388 | 11,210 | ||
| Repayment of financial liabilities | 0 | 0 | 0 | ||
| Net cash at the end of the period | 818,598 | −695,895 | 122,703 |
| INVESTMENT PORTFOLIO BRIDGE | FAIR VALUE AT | INVESTMENTS 3 | DIVESTMENTS 3 AND REVENUES | MARKET IMPACT |
FX IMPACT FAIR VALUE AT | 30/06/2023 VALUE CREATION % 4 | |||
|---|---|---|---|---|---|---|---|---|---|
| (1ST SEMESTER 2023) | 31/12/2022 | CASH | NON-CASH 5 | CASH | NON-CASH 5 | ||||
| Sofina Direct | 4,759,857 | 83,489 | 67 | −137,815 | −8,559 | 172,934 | −22,731 | 4,847,242 | 3% |
| Sofina Private Funds | 4,302,404 | 154,350 | 425 | −113,497 | −13,848 | −43,750 | −72,160 | 4,213,924 | −3% |
| Total Investment portfolio | 9,062,261 | 237,839 | 492 | −251,312 | −22,407 | 129,184 | −94,891 | 9,061,166 | 0% |
1 Difference compared with the dividends presented in the comprehensive income is mainly due to cut-offs between declaration and payment periods or to withholding taxes.
2 Difference compared with the management expenses presented in the comprehensive income is mainly due to the payment in the current year of the Long-Term Incentive Plan (LTIP) accrual of the previous year.
3 Net of intragroup transfers.
4 (Fair value at the end of the year + Divestments and revenues of the year) divided by (Fair value at the beginning of the year + Investments of the year).
5 Mainly composed of escrows and cut-offs (i.e. differences when the realisation of a transaction and its cash impact occur in two different financial years).
IN THOUSAND EUR
Message to shareholders Highlights We are Sofina
Accounts and notes
• Consolidated financial statements
• Notes to the consolidated financial statements
• Independent auditor's report
| SITUATION AS AT 31 DECEMBER 2023 |
|---|
| ---------------------------------- |
| IN THOUSAND EUR | |||||
|---|---|---|---|---|---|
| COMPREHENSIVE INCOME (2023) | SOFINA DIRECT | SOFINA PRIVATE FUNDS |
TOTAL | RECONCILING ITEMS | FINANCIAL STATEMENTS |
| Dividends | 43,331 | 896 | 44,227 | 333,230 | 377,457 |
| Long-term minority investments | 43,331 | ||||
| Sofina Growth | 0 | ||||
| Net result of the investment portfolio | 55,531 | −131,583 | −76,052 | −412,031 | −488,083 |
| Long-term minority investments | 159,525 | ||||
| Sofina Growth | −103,994 | ||||
| Management expenses | −52,007 | 11,397 | −40,610 | ||
| Other 1 | −19,775 | 67,404 | 47,629 | ||
| Total comprehensive income | −103,607 0 |
−103,607 | |||
| BALANCE SHEET (31/12/2023) | SOFINA DIRECT SOFINA PRIVATE FUNDS | TOTAL | RECONCILING ITEMS | IN THOUSAND EUR FINANCIAL STATEMENTS |
|
| Investment portfolio | 4,739,235 | 4,189,006 | 8,928,241 | −317,797 | 8,610,444 |
| Long-term minority investments | 2,846,919 | ||||
| Sofina Growth | 1,892,316 | ||||
| Net cash | 197,301 | −180,991 | 16,310 | ||
| Gross cash | 893,590 | −180,991 | 712,599 | ||
| Financial liabilities | −696,289 | 0 | −696,289 | ||
| (In)tangible fixed assets | 10,223 | −1,297 | 8,926 | ||
| Other assets and liabilities 1 | −52,334 | 500,085 | 447,751 | ||
| NAV | 9,083,431 | 0 | 9,083,431 |
1 This includes the deferred tax liabilities (EUR 35.88 million in the comprehensive income representing a total amount of EUR 37.06 million in the liabilities) for the temporary tax differences recognised by some investment subsidiaries between the carrying amount and the tax base of portfolio investments impacting their fair value recognised in Sofina SA's investment portfolio. Moreover, there are accumulated profits within Sofina Private Funds which could become taxable at a 25% tax rate in the theoretical scenario where the relevant investment subsidiaries holding such portfolio were to be liquidated and profit repatriated to Sofina SA, which will however not materialise in the current going-concern context. Depending on the theoretical scenarios considered (such as a sale or a liquidation of Sofina Private Funds), 0% to 60% of the Net Asset Value of the investment subsidiaries holding Sofina Private Funds could become taxable at 25%. However, this hypothetical tax has not been recognised because the trigger events are under the control of Sofina SA, and moreover not probable. Furthermore, the investment subsidiaries of Sofina SA do not recognise deferred tax assets for tax losses carried forward because their recovery is not considered probable. Here also, since there is no deferred tax asset recognised by the investment subsidiaries in this respect, their fair value is not impacted.
Our mission Message to shareholders Highlights
Accounts and notes
- Consolidated financial statements
- Notes to the consolidated financial statements
- • Independent auditor's report
| The management cash flow statement below provides cash flow information in transparency for all group subsidiaries. | |
|---|---|
| IN THOUSAND EUR | |||||
|---|---|---|---|---|---|
| MANAGEMENT CASH FLOW STATEMENT (2023) | SOFINA DIRECT | SOFINA PRIVATE FUNDS | TOTAL GROSS CASH | FINANCIAL LIABILITIES | TOTAL NET CASH |
| Net cash at the beginning of the year | 928,558 | −695,507 | 233,051 | ||
| Dividends 1 | 43,268 | 896 | 44,164 | 44,164 | |
| Management expenses 2 | −46,690 | −46,690 | |||
| Investments in portfolio | −223,259 | −293,539 | −516,798 | −516,798 | |
| Divestments from portfolio | 309,048 | 280,743 | 589,791 | 589,791 | |
| Dividends paid | −108,030 | −108,030 | |||
| Other items | 2,595 | −390 | 1,813 | ||
| Repayment of financial liabilities | 0 | 0 | 0 | ||
| Net cash at the end of the year | 893,590 | −696,679 | 197,301 |
| IN THOUSAND EUR | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| INVESTMENT PORTFOLIO BRIDGE (2023) | FAIR VALUE AT 31/12/2022 |
INVESTMENTS 3 | DIVESTMENTS 3 AND REVENUES | MARKET | FAIR VALUE | VALUE | |||
| CASH | NON-CASH 5 | CASH | NON-CASH 5 | IMPACT | FX IMPACT | AT 31/12/2023 | CREATION % 4 | ||
| Sofina Direct | 4,759,857 | 223,259 | 94,276 | −349,005 | −90,139 | 164,779 | −63,792 | 4,739,235 | 2% |
| Sofina Private Funds | 4,302,404 | 291,106 | 0 | −260,521 | −13,296 | 7,441 | −138,128 | 4,189,006 | −3% |
| Total Investment portfolio | 9,062,261 | 514,365 | 94,276 | −609,526 | −103,435 | 172,220 | −201,920 | 8,928,241 | 0% |
1 Difference compared with the dividends presented in the comprehensive income is mainly due to cut-offs between declaration and payment periods or to withholding taxes.
2 Difference compared with the management expenses presented in the comprehensive income is mainly due to the non-cash expenses of the stock option plans granted.
3 Net of intragroup transfers.
4 (Fair value at the end of the year + Divestments and revenues of the year) divided by (Fair value at the beginning of the year + Investments of the year).
5 Mainly composed of a non-cash re-investments of an exit proceed, escrows and cut-offs (i.e. differences when the realisation of a transaction and its cash impact occur in two different financial years).
| Accounts and notes |
|---|
| Half-year in review |
| We are Sofina |
| Highlights |
| Message to shareholders |
| Our mission |
- Consolidated financial statements
- Notes to the consolidated financial statements
- • Independent auditor's report
2.2 COMMENTS ON THE EVOLUTION OF THE PORTFOLIO IN TRANSPARENCY
The main movements in acquisitions and disposals of participations relating to the Sofina Direct portfolio in the first half of 2024 (with a fair value in excess of EUR 10 million) concern the following financial assets:
| CORPORATE RIGHTS | |||
|---|---|---|---|
| % OWNERSHIP INVESTED 1 |
% OWNERSHIP SOLD 1 |
||
| Biobest Group (BioFirst) | 0.00% | ||
| Lancelot UK HoldCo (EG Software) | 14.57% | ||
| MNH (Mérieux NutriSciences) | 15.50% | ||
| Colruyt Group | 0.29% | ||
| GL events | 8.67% | ||
| Honasa Consumer (Mamaearth) | 1.00% | ||
| HSG Co-Investment 2016-A (ByteDance) | 0.00% | ||
| Mérieux NutriSciences | 15.45% | ||
| Polygone (GL events) | 20.96% | ||
| SCR - Sibelco | 1.32% |
The main Sofina Direct level 1 2 investments (with a fair value in excess of EUR 10 million) held by the Sofina group as at 30 June 2024 are as follows:
| CORPORATE RIGHTS HELD | ||||
|---|---|---|---|---|
| YEAR OF THE 1ST INVESTMENT |
NUMBER OF SHARES |
% OWNERSHIP | FAIR VALUE (IN THOUSAND EUR) |
|
| 1stdibs.com | 2015 | 2,613,568 | 6.71% | 10,962 |
| bioMérieux | 2009 | 2,282,513 | 1.93% | 202,573 |
| GL events | 2012 | 2,169,913 | 7.24% | 36,064 |
| Honasa Consumer (Mamaearth) |
2021 | 16,731,585 | 5.16% | 81,146 |
| IHS Holding | 2014 | 3,467,574 | 1.04% | 10,365 |
| Luxempart | 1992 | 1,257,500 | 6.07% | 94,313 |
| The Hut Group (THG) | 2016 | 115,542,400 | 8.68% | 84,911 |
The are no net movements of more than EUR 10 million relating to the Sofina Private Funds' portfolio in the first half of 2024.
1 Changes in undiluted ownership percentage as at 30 June 2024 due to new acquisitions and disposals during the year. In the case of Biobest Group (BioFirst), this movement is a capital call that did not involve a purchase of shares, and thus does not cause a change in the ownership percentage. In the case of HSG Co-Investment 2016-A (ByteDance), this movement is a distribution that did not involve a sale of shares, and thus do not cause a change in the ownership percentage.
2 For the definitions of levels, see point 2.3 below.
| Our mission |
|---|
| Message to shareholders |
| Highlights |
| We are Sofina |
| Half-year in review |
| Accounts and notes |
| • Consolidated financial statements |
| • Notes to the consolidated financial statements |
| • Independent auditor's report |
| Glossary |
| Responsible person |
The main Sofina Direct level 2 and level 3 1 investments (with a fair value in excess of EUR 10 million) held by the Sofina group as at 30 June 2024 are as follows:
| YEAR OF THE 1ST | CORPORATE RIGHTS HELD | ||
|---|---|---|---|
| INVESTMENT | NUMBER OF SHARES |
% OWNERSHIP | |
| Biobest Group (BioFirst) | 2022 | 162,012 | 11.11% |
| Birdie Care Services | 2022 | 3,924,379 | 15.46% |
| Cambridge Associates | 2018 | 24,242 | 24.01% |
| Carebridge Holdings | 2016 | 15,347,479 | 3.58% |
| Cleo AI | 2022 | 4,237,499 | 13.29% |
| CoachHub | 2022 | 15,089 | 9.32% |
| Collibra | 2020 | 6,936,516 | 2.88% |
| Dott HoldCo (Dott) | 2021 | 17,371,386 | 20.22% |
| Dreamplug Technologies (Cred) | 2021 | 57,596 | 1.93% |
| Drylock Technologies | 2019 | 169,782,750 | 25.00% |
| Everdrop | 2022 | 5,669 | 10.11% |
| Grand Rounds (Included Health) | 2018 | 11,358,956 | 1.86% |
| Graphcore | 2018 | 11,131,375 | 2.67% |
| Grasper Global (Skillmatics) | 2022 | 379,198 | 10.34% |
| Green Agrevolution (DeHaat) | 2021 | 479,611 | 12.56% |
| Green E Origin | 2023 | 279,851 | 24.51% |
| Petit Forestier Group | 2007 | 976,838 | 33.62% |
| Hector Beverages | 2015 | 3,576,234 | 18.10% |
| K12 Techno Services | 2020 | 3,886,480 | 20.17% |
| Labster Group | 2022 | 2,870,989 | 4.46% |
| Lancelot UK HoldCo (EG Software) | 2024 | 41,914,362 | 14.57% |
| M.Chapoutier | 2007 | 3,124 | 14.20% |
| MedGenome | 2017 | 8,150,293 | 16.98% |
| Mistral Al | 2023 | 1,097,282 | 0.38% |
| MNH (Mérieux NutriSciences) | 2014 | 80,152 | 15.50% |
| Moody E-Commerce Group | 2021 | 95,610 | 3.63% |
| Nuxe International | 2019 | 193,261,167 | 49.00% |
| Petkit Technology | 2021 | 10,746,355 | 5.06% |
| Pine Labs | 2015 | 147,582 | 1.89% |
| Rohlik | 2022 | 52,678 | 8.90% |
| Salto Systems | 2020 | 22,293 | 12.17% |
| Shenzhen Shuye Innovative Technology (Laifen) |
2023 | 320,449 | 4.08% |
|---|---|---|---|
| ThoughtSpot | 2017 | 3,263,785 | 2.57% |
| Twin Health | 2021 | 2,253,562 | 4.08% |
| Typeform | 2022 | 69,208 | 6.93% |
| Veepee | 2016 | 3,756,786 | 5.64% |
| Ver Se Innovation | 2019 | 1,144,790 | 4.84% |
| Vinted | 2019 | 3,462,528 | 3.64% |
The main Sofina Direct level 2 and level 3 1 investments (with a fair value in excess of EUR 10 million) held through a (or several) syndication vehicle(s) gathering part of the shareholder base as at 30 June 2024 are as follows:
| CORPORATE RIGHTS HELD | ESTIMATED | |||
|---|---|---|---|---|
| YEAR OF THE 1ST INVESTMENT |
NUMBER OF SHARES |
% OWNERSHIP IN THE INTERMEDIARY VEHICLE |
ECONOMIC INTEREST IN THE UNDERLYING INVESTMENT |
|
| Aevum Investments (Xinyu) | 2018 | - | 100.00% | 4.90% |
| Ergon opseo Long Term Value Fund (opseo) |
2016 | - | 8.82% | 7.46% |
| GoldIron (First Eagle) | 2016 | 21,721 | 70.68% | 3.99% |
| HSG Co-Investment 2016-A (ByteDance) |
2016 | - | 41.67% | 0.18% |
| Iconiq Strategic Partners III Co-Invest (Series RV) |
2018 | - | 7.15% | 0.26% |
| Kedaara Norfolk Holdings (Lenskart) |
2019 | 158,355 | 50.00% | 0.73% |
| Lernen Midco 1 (Cognita) | 2019 | 252,517,893 | 15.55% | 14.14% |
| M.M.C. (Chapoutier) | 2007 | 15,256 | 19.83% | 15.33% |
| MxBEE (BioFirst) | 2022 | 7,820,093 | 26.64% | 1.48% |
| TA Action Holdings (ACT) | 2016 | - | 44.44% | 3.65% |
| TA Vogue Holdings (TCNS) | 2016 | - | 48.72% | 4.07% |
The General Partners that manage investment funds on our behalf, whose individual value exceeded EUR 10 million as at 30 June 2024 are Accel, Andreessen Horowitz, Archipelago, Ares, Ascendent, Atlantic Labs, Atomico, Bain, Battery, Bessemer, Bling, Blossom, Bond, Chryscapital, Draper Fisher Jurvetson, DST, Falcon House, Felix, Formation 8, Founders Fund, Foundry, Francisco, General Atlantic, Genesis, GGV, Highland, HongShan, Iconiq, Insight, Institutional Venture Partners, InvAscent, Isola, Kedaara, Kleiner Perkins, Lightspeed, Lux Capital, Lyfe, Multiples, New Enterprise Associates, Northzone, OpenView, Peak XV, Phoenix Court, Polychain, Qiming, Redpoint, Sequoia, Sofindev, Source Code, Spark, Summit, TA Associates, Thoma Bravo, Thrive, Tiger Global, Trustbridge and Venrock.
1 For the definition of levels, see point 2.3 below.
Accounts and notes
• Independent auditor's report
2.3 INVESTMENT PORTFOLIO IN TRANSPARENCY
Main valuation rules for the investment portfolio
The Sofina group uses a fair value hierarchy that reflects the significance of the data used for valuation purposes:
- Level 1 – Assets valued under level 1 are valued at the market price at the closing date;
- Level 2 – Assets valued under level 2 are valued based on observable data such as the market price of the main asset held by the company;
- Level 3 – Assets valued under level 3 are valued at fair value using principles derived from the International Private Equity and Venture Capital Valuation Guidelines ("IPEV" Valuation Guidelines of December 2022).
Unlisted securities are valued at each reporting date using a commonly accepted valuation method in these IPEV Valuation Guidelines, or at net asset value.
The different valuation methods are detailed in the table on the methods applied in accordance with IFRS 13 to determine the fair value of unlisted level 3 assets of the investment portfolio in transparency (Sofina Direct, i.e. Long-term minority investments and Sofina Growth, and Sofina Private Funds).
Note that the IPEV Valuation Guidelines no longer consider the recent transaction price as a default valuation technique but rather a starting point for estimating fair value. The recent transaction price as a valuation technique is therefore only used when the recent transaction is sufficiently close to the balance sheet closing date (and meets the market and market participant criteria). It should also be noted that the context of the transaction is analysed and could therefore consider not only the primary components of a transaction but also the secondary components of the same transaction (e.g., retaining a blended price instead of the primary round price only).
The principle of calibration, which consists of testing or calibrating the valuation techniques to be used at subsequent valuation dates, using valuation parameters derived from the initial or most recent transaction, is applied as appropriate to all our valuations of unlisted investments (Sofina Direct, i.e. Long-term minority investments and Sofina Growth), provided that the price of the initial or most recent transaction is representative of the fair value at the time of the transaction and can be calibrated. The calibration makes it possible to derive from the entry price the discount or the premium against the group of comparable companies by comparing the rate of return expected by Sofina with the theoretical cost of capital for a given investment in the context of the implementation of the discounted cash flow method. The calibration also makes it possible to determine, directly at the transaction date, the discount or the premium against the group of comparable companies in the context of the implementation of the market multiples method. This technique explains the wide range of discounts, costs of capital or discount factors, as these are the result of the calibration.
This being said, Sofina may have to change the valuation technique depending on the circumstances from one valuation exercise to another (e.g. due to a new type of data available, a new recent transaction), with the objective of maximising the use of observable data and minimising the use of non-observable data.
In this respect, the following table provides information on the methods applied in accordance with IFRS 13 – Fair Value Measurement – to determine the fair value of unlisted level 3 assets.
It should also be noted that Sofina uses the option pricing method (OPM) to allocate the estimated equity fair value to various classes of equity shares considering their rights and preferences (if applicable). This allocation approach may significantly reduce the valuation of earlier equity rounds with reduced rights and preferences compared to the latest round.
It is worth mentioning that the current economic situation and the recent crises increases the uncertainty of the future performance of the investments held by Sofina. These uncertainties regarding the performance of these investments lead to a higher degree of subjectivity in the determination of level 3 fair values in the IFRS 13 hierarchy. This has prompted Sofina to embed in its valuation process a high degree of vigilance. The following are especially worth mentioning given the current economic situation:
- Particular vigilance regarding the consistency between the estimates of the portfolio companies and the use of these estimates compared to the use of the multiples of comparable companies;
- Particular vigilance regarding the validation of the most recent transaction by ensuring that this recent transaction takes into account the current context of the economic situation (while respecting the other validation criteria of the most recent transaction such as being sufficiently close to the closing date) as well as ensuring that the context of the recent transaction is properly understood by considering both primary and secondary components (if applicable);
- Particular vigilance regarding the financial situation of the portfolio companies (e.g., cash burn estimates).
We also took into account the IPEV Board Special Valuation Guidance of December 2022.
It should be noted that Sofina has engaged Kroll, an independent valuation firm, to assist in the valuation of the unlisted investments by the Sofina Direct portfolio. The assistance provided by Kroll does not, therefore, cover Sofina Private Funds. All these unlisted investments (the "Investments"), covered by Kroll's assistance, represent 49% of the fair value of the portfolio in transparency, as illustrated below 1 .
| FAIR VALUE HIERARCHY 2 | LONG-TERM MINORITY INVESTMENTS |
SOFINA GROWTH |
SOFINA PRIVATE FUNDS |
% OF KROLL COVERAGE ON TOTAL LEVEL |
|---|---|---|---|---|
| Level 1 | Not covered | Not covered Not applicable | 0% | |
| Level 2 | Covered | Covered | Not applicable | 100% |
| Level 3 | Covered | Covered | Not covered | 51% |
| Total portfolio in transparency | 49% |
1 Covered: covered by Kroll's assistance; Not covered: not covered by Kroll's assistance; Not applicable: no value present at this level in the relevant investment style.
2 For the ventilation of the portfolio by level and investment style, see point 2.4 below.
Accounts and notes
- Consolidated financial statements
- Notes to the consolidated financial statements
- • Independent auditor's report
This assistance included various limited procedures that Sofina identified and requested Kroll to perform. In connection with and as a result of these limited procedures 1 , Kroll concluded that the fair value of the "Investments", as determined by Sofina, was reasonable.
Sofina Private Funds' investments in venture and growth capital funds are valued on the basis of the latest reports obtained from the General Partners of these investment funds until mid-August and their valuation is therefore based either on a report as at 30 June 2024 or on a report as at 31 March 2024. The values of the reports as at 31 March 2024 are adjusted to take into account (i) capital calls and distributions that have occurred since this last valuation date, (ii) changes in the stock market prices of the listed companies held by these funds and (iii) significant events that have occurred since this last valuation date and the closing date of 30 June 2024. The values as at 30 June 2024 are not adjusted as they reflect the fair value at the closing date. Finally, the values retained are converted into euro using the closing exchange rate. As at 30 June 2024, more than 84% of the Sofina Private Funds fair value is based either on reports as at 30 June 2024 or valuations based on market prices or transaction prices.
1 Limited procedures are not an audit, review, compilation or other form of examination or certification in accordance with generally accepted auditing standards. In addition, the limited procedures were not performed in anticipation of or in connection with any investment made or contemplated by Sofina. Accordingly, any party contemplating an investment in these "Investments" or any party contemplating an investment directly in the capital of Sofina should not consider the performance of these limited procedures by Kroll to be sufficient in light of the aforementioned investments. The results of Kroll's analysis should not be construed as a fairness opinion on any transaction or as a statement of creditworthiness. The limited procedures performed by Kroll are in addition to the procedures that Sofina is required to perform to estimate the fair value of the "Investments". The result of the analyses conducted by Kroll was taken into account by Sofina in its assessment of the fair value of the "Investments".
| SOFINA | ||||||
|---|---|---|---|---|---|---|
| -------- | -- | -- | -- | -- | -- | -- |
• Independent auditor's report
Accounts and notes
• Notes to the consolidated financial statements
| VALUATION TECHNIQUE | USE OF THE TECHNIQUE | SIGNIFICANT UNOBSERVABLE DATA |
LINKS BETWEEN UNOBSERVABLE DATA AND FAIR VALUE |
|---|---|---|---|
| Price of the most recent investment (PORI) |
Whenever a recent and significant transaction has taken place for the investment at the balance sheet date and provided that the transaction meets the market and market participant criteria. Note that the IPEV Valuation Guidelines no longer consider the recent transaction price to be a default valuation technique but rather a starting point for estimating fair value. The recent transaction price as a valuation technique is therefore only used when the recent transaction is sufficiently close to the closing date (and meets the market and market participant criteria). As part of this investment technique, an investment for which a purchase and sale agreement was signed is valued based on the terms of the purchase and sale agreement. Depending on the closing conditions set out under purchase and sale agreement, closing probabilities can be taken into account in the valuation. |
The fair value of the most recent transaction is considered unobservable data. |
As the unobservable data increases, the fair value increases. |
| Cost of capital from calibration. |
The higher the cost of capital, the lower the fair value. |
||
| Discounted Cash Flow model | Applied for mature companies or for companies where sufficient information is available. This method consists in discounting future expected cash flows. |
Terminal value based on a long-term growth rate. |
The higher the long-term growth rate, the higher the fair value. |
| Terminal value based on an exit multiple. |
The higher the exit multiple, the higher the fair value. |
||
| Market multiples - sales or a gross pofit or EBITDA or earnings multiples or a mix of these multiples (based on comparable listed companies) |
In the absence of a recent transaction on the investment at the closing date and when the Discounted Cash Flow model is not applied. The calibration principle is used to determine the discount to the group of comparable listed companies. |
Discount 1 resulting from the calibration against the group of comparable companies. |
The higher the discount, the lower the fair value. |
| Discount factor from the calibration. |
The higher the discount factor, the lower the fair value. |
||
| Probability Weighted Expected Returns Model or Scenario Methods (PWERM) |
Start-ups or "early stage" companies or certain companies for which significantly different scenarios remain possible, when other methods cannot be applied (recent transaction, Discounted Cash Flow model, market multiples), are valued according to scenarios. Such companies are valued on the basis of different possible future scenarios (probability–weighted fair value of future outcomes). |
Weights attributed to the different scenarios (generally 3 to 4 scenarios, from extremely pessimistic to optimistic). |
The higher the weight of the pessimistic scenario, the lower the fair value. |
| Exit value based on an exit multiple. |
The higher the exit multiple, the higher the fair value. |
||
| Milestones approach | This valuation method is applied to start-ups or "early-stage" companies or companies for which important milestones must be achieved and when other methods (i.e. recent transaction, discounted cash flow model, market multiples and PWERM) are not applicable. Such companies are valued using the milestone approach. This method consists of assessing whether there is an indication of change in fair value based on a consideration of one or more milestones. One or several key milestones are commonly established in accordance with function of the stage of development of the company. Milestones may include, for example, financial measures, technical measures and marketing and sales measures. Such companies are valued using the milestone approach. This method consists of assessing whether there is an indication of change in fair value based on a consideration of one or more milestones. One or several key milestones are commonly established in accordance with function of the stage of development of the company. Milestones may include, for example, financial measures, technical measures and marketing and sales measures. |
Discount applied per level according to the predefined milestones. |
A discount is applied per milestone. If a milestone is achieved, the more the unobservable data increases or decreases, the more the fair value increases or decreases. If the first milestone is not achieved, the more the unobservable data decreases, the more the fair value decreases. |
1 In some cases, a premium is applied against the group of comparable companies, also based on the calibration principle. In some exceptional cases, the discount is estimated on the basis of methods other than calibration.
Accounts and notes
- Consolidated financial statements
- Notes to the consolidated financial statements
- • Independent auditor's report
| Revalued net assets recognised at fair value |
This valuation method is based on the latest available statements from the General Partners. This method consists of using the reported net assets value of a fund interest which is adjusted for (i) the capital calls and distributions that took place after the last statement received and the measurement date, (ii) the evolution of the listed companies held by the funds and (iii) any other |
Fair value based on General Partners' reports is considered to be |
As the unobservable data increases, the fair value increases. |
|---|---|---|---|
| Other methods | significant events. The underlying investments of the fund must be reported at fair value. In exceptional cases, another methodology is considered to better reflect the fair value of the investment or a portion of the investment (e.g. an appraisal report on the value of land or property). The fair value of a debt investment, in the absence of actively traded prices, is generally derived from a yield analysis taking into account credit quality, coupon and term as well as applying the calibration principle (yield approach). |
unobservable data. Fair value based on expert reports is considered to be unobservable data. For the yield approach for a debt investment, the yield is considered to be unobservable data. |
As the unobservable data increases, the fair value increases. For the yield approach, the higher the yield, the lower the fair value. |
Method applied to allocate the estimated equity fair value to various classes of equity shares considering their respective rights and preferences
| VALUATION TECHNIQUE | USE OF THE TECHNIQUE | SIGNIFICANT UNOBSERVABLE DATA | LINKS BETWEEN UNOBSERVABLE DATA AND FAIR VALUE |
|
|---|---|---|---|---|
| Option pricing model (OPM) | Volatility, | An increase of the volatility can either increase or decrease the fair value depending on the classes of shares held, |
||
| Applied for companies where rights and preferences may differ significantly between the classes of shares. Applied when applicable and relevant (e.g. different rights and preferences exist per class of shares and market |
Time to expiration (e.g. time of exit or liquidity event), |
An increase of the time to expiration can either increase or decrease the fair value depending on the classes of shares held, |
||
| participant would consider those rights and preferences). | Interest rate in local currency, | An increase of the interest rate can either increase or decrease the fair value depending on the classes of shares held, |
Accounts and notes
• Independent auditor's report
2.4 FAIR VALUE OF THE TOTAL INVESTMENT PORTFOLIO IN TRANSPARENCY
| IN THOUSAND EUR | |||||
|---|---|---|---|---|---|
| TOTAL AS AT 30/06/2024 |
LEVEL 1 | LEVEL 2 | LEVEL 3 | ||
| Investment portfolio 1 | 9,587,555 | 532,548 | 21,079 | 9,033,928 | |
| Sofina Direct | 5,189,930 | 532,548 | 21,079 | 4,636,303 | |
| Long-term minority investments | 3,270,186 | 428,674 | 0 | 2,841,512 | |
| Sofina Growth | 1,919,743 | 103,874 | 21,079 | 1,794,790 | |
| Sofina Private Funds | 4,397,625 | 0 | 0 | 4,397,625 | |
| TOTAL AS AT 31/12/2023 |
LEVEL 1 | LEVEL 2 | LEVEL 3 | ||
| Investment portfolio | 8,928,241 | 566,192 | 155,962 | 8,206,087 | |
| Sofina Direct | 4,739,235 | 566,192 | 155,962 | 4,017,081 | |
| Long-term minority investments | 2,846,919 | 539,696 | 44,135 | 2,263,088 | |
| Sofina Growth | 1,892,315 | 26,496 | 111,827 | 1,753,992 | |
| Sofina Private Funds | 4,189,006 | 0 | 0 | 4,189,006 |
The underlying portfolio of the funds held in Sofina Private Funds is composed of listed and unlisted assets. The fair value 2 of listed assets is estimated at EUR 444,302 thousand as at 30/06/2024 and EUR 483,162 thousand as at 31/12/2023.
During the year our investment in Honasa Consumer (Mamaearth) was transferred from level 2 to level 1.
Sensitivity analysis of level 3
Level 3 consists of unlisted securities subject to price risk, but this risk is mitigated by the wide variety of investments made by the Sofina group. The objective of long-term value creation pursued by the Sofina group contributes towards mitigating this risk.
In the case of investments in venture and growth capital funds of Sofina Private Funds, the General Partners may decide more quickly to modify a negative spread. Market risk may also have an indirect impact on unlisted securities compared to securities listed on stock markets.
Moreover, liquidity risk has a greater impact on unlisted securities than on listed securities, which can make their value difficult to estimate. This risk may have an impact on the holding period of unlisted securities as well as on the exit price. It is difficult to quantify the influence of these risks on unlisted securities in level 3.
- 1 Information on the investment portfolio in the balance sheet as at 30 June 2024 can be found under point 2.1 above.
- 2 Estimated fair value based on available information provided by the General Partners.
| Our mission | |
|---|---|
| Message to shareholders | |
| Highlights | |
| We are Sofina | |
| Half-year in review | |
| Accounts and notes | |
| • Consolidated financial statements |
Market multiples |
| • Notes to the consolidated financial statements |
|
| • Independent | |
| auditor's report | |
| Glossary | |
| Responsible person | |
Sensitivity analysis for the level 3 investment portfolio in transparency as at 30 June 2024
| VALUATION TECHNIQUE | FAIR VALUE |
OPM | APPLIED? UNOBSERVABLE DATA (WEIGHTED AVERAGE) | SENSITIVITY IMPACT VALUE SENSITIVITY IMPACT VALUE | |||
|---|---|---|---|---|---|---|---|
| Price of the most recent investment (PORI) |
592 | No | The fair value of the most recent transaction is considered to be unobservable data |
+10% | 59 | -10% | -59 |
| Cost of capital from calibration between 7.6% and 16.5% (13.3%) | +10% | -102 | -10% | 110 | |||
| Discounted Cash Flow model | 1,874 | No | Perpetual growth rate of 3.5% and 3.5% (3.5%) | +10% | 6 | -10% | -6 |
| Exit multiple between 7.1x and 17.2x (12.3x) | +10% | 162 | -10% | -162 | |||
| Median peers revenue multiple between 0.8x and 6.2x (2.1x) | +10% | 40 | -10% | -40 | |||
| Market multiples | Median peers gross profit multiple between 3.7x and 3.7x (3.7x) | +10% | 0 | -10% | -1 | ||
| 1,147 | No | Median peers EBITDA multiple between 10.6x and 26.2x (20.7x) | +10% | 37 | -10% | -32 | |
| Median peers earnings multiple between 6x and 10.4x (9.9x) | +10% | 9 | -10% | -9 | |||
| Discount resulting from calibration between 0.3% and 52.2% 1 (18.6%) | +10% | -34 | -10% | 34 | |||
| Median peers revenue multiple between 0.5x and 10.5x (4.7x) | +10% | 41 | -10% | -41 | |||
| Median peers gross profit multiple between 5.1x and 5.4x (5.4x) | +10% | 3 | -10% | -3 | |||
| Median peers EBITDA mutiple between 30.1% and 30.1% (30.1%) | +10% | 1 | -10% | -1 | |||
| Median peers earnings multiple between 17,6x and 21,1x (19,3x) | +10% | 1 | -10% | -1 | |||
| 909 | Yes | Discount resulting from calibration between 4.4% and 57.6% 2 (29.3%) | +10% | -23 | -10% | 23 | |
| Volatility between 23.3% and 77.2% (40.7%) | +10% | -3 | -10% | 2 | |||
| Time to expiration between 0.5 years and 6.5 years (3.2 years) | +10% | -5 | -10% | 5 | |||
| Interest rate between 0.7% and 7% (4.5%) | +10% | -3 | -10% | 4 | |||
| Revalued net assets recognised at fair value 3 |
4,439 | No | The fair value based on General Partners' reports is considered to be unobservable data |
+10% | 444 | -10% | -444 |
| Milestone approach | 0 | No | Discount of 20% per level (20%) | Upper level 4 |
0 | Lower level | 0 |
| Other methods | 72 | No | Fair value is considered to be unobservable data. For the yield approach, the yield is considered to be unobservable data (4.9%) |
+10% | 7 | -10% | -7 |
| Total level 3 (in transparency) | 9,033 | ||||||
| Reconciling items | 205 | ||||||
| Total level 3 (financial statements) | 9,238 |
The reconciling items between the presentation in transparency and the balance sheet presentation are detailed, at all levels, in point 2.1 above.
1 In some cases, a premium is applied against the group of comparable companies. The premiums applied range from 8.9% to 330.4% (weighted average of 147.4%). In certain exceptional cases, the discount is estimated based on methods other than calibration.
2 In some cases, a premium is applied against the group of comparable companies. The premiums applied range from 0% to 1,620.8% (weighted average of 165.5%). In certain exceptional cases, the discount is estimated based on methods other than calibration.
- 3 Mainly concerns the portfolio of Sofina Private Funds and to a limited extent investments by Sofina Growth.
- 4 No upper level was reached.
IN MILLION EUR
| Our mission | |
|---|---|
| Message to shareholders | |
| Highlights | |
| We are Sofina | |
| Half-year in review | |
| Accounts and notes | |
| • Consolidated financial statements |
|
| • Notes to the consolidated financial statements |
|
| • Independent auditor's report |
|
| Glossary | |
| Responsible person |
Sensitivity analysis for the level 3 investment portfolio in transparency as at 31 December 2023
| IN MILLION EUR | |||||||
|---|---|---|---|---|---|---|---|
| VALUATION TECHNIQUE | FAIR VALUE |
OPM | APPLIED? UNOBSERVABLE DATA (WEIGHTED AVERAGE) | SENSITIVITY IMPACT VALUE SENSITIVITY IMPACT VALUE | |||
| Price of the most recent investment (PORI) |
153 | No | The fair value of the most recent transaction is considered to be unobservable data |
+10% | 8 | -10% | -8 |
| Cost of capital from calibration between 7% and 17.7% (12.7%) | +10% | -250 | -10% | 325 | |||
| Discounted Cash Flow model | 1,876 | No | Perpetual growth rate of 2.5% and 3.5% (3.2%) | +10% | 50 | -10% | -42 |
| Exit multiple between 5.4x and 17x (11.4x) | +10% | 141 | -10% | -141 | |||
| Median peers revenue multiple between 0.9x and 6.4x (2.8x) | +10% | 57 | -10% | -57 | |||
| Median peers gross profit multiple between 3.7x and 3.7x (3.7x) | +10% | 0 | -10% | -1 | |||
| Median peers EBITDA multiple between 7.9x and 18.1x (16.1x) | +10% | 29 | -10% | -24 | |||
| 1,129 | No | Median peers earnings multiple between 13.3x and 20.6x (14.2x) | +10% | 9 | -10% | -9 | |
| Discount resulting from calibration between 0% and 89.4% 1 (23.7%) | +10% | -13 | -10% | 17 | |||
| Market multiples | Median peers revenue multiple between 0.5x and 13.1x (5.4x) | +10% | 45 | -10% | -45 | ||
| Median peers gross profit multiple between 7.7x and 11.4x (7.7x) | +10% | 3 | -10% | -3 | |||
| Discount resulting from calibration between 23% and 57.6% 2 (39.5%) | +10% | -8 | -10% | 8 | |||
| 745 | Yes | Volatility between 22.8% and 88% (45.3%) | +10% | -5 | -10% | 4 | |
| Time to expiration between 0.4 years and 7 years (3.7 years) | +10% | -5 | -10% | 5 | |||
| Interest rate between 0.8% and 7.1% (4.3%) | +10% | -3 | -10% | 3 | |||
| Revalued net assets recognised at fair value 3 |
4,233 | No | The fair value based on General Partners' reports is considered to be unobservable data |
+10% | 423 | -10% | -423 |
| Milestone approach | 0 | No | Discount of 20% per level (20%) | Upper level 4 |
0 | Lower level | 0 |
| Other methods | 70 | No | Fair value is considered to be unobservable data. For the yield approach, the yield is considered to be unobservable data (4.9%) |
+10% | 6 | -10% | -6 |
| Total level 3 (in transparency) | 8,206 | ||||||
| Reconciling items | 23 | ||||||
| Total level 3 (financial statements) | 8,229 |
The reconciling items between the presentation in transparency and the balance sheet presentation are detailed, at all levels, in point 2.1 above.
- 1 In some cases, a premium is applied against the group of comparable companies. The premiums applied range from 13.2% to 626% (weighted average of 176.7%). In certain exceptional cases, the discount is estimated based on methods other than calibration.
- 2 In some cases, a premium is applied against the group of comparable companies. The premiums applied range from 0% to 652.2% (weighted average of 180.6%). In certain exceptional cases, the discount is estimated based on methods other than calibration.
- 3 Mainly concerns the portfolio of Sofina Private Funds and to a limited extent investments by Sofina Growth.
- 4 No upper level was reached.
Message to shareholders
Accounts and notes
• Independent auditor's report
2.5 FINANCIAL RISKS IN TRANSPARENCY
Foreign exchange risk
The investment portfolio is subject, among other things, to foreign exchange risks. The main foreign exchange risk relates to assets denominated in US dollars, British pounds, Indian rupees, Danish kroner and Chinese yuans renminbi. For information purposes, a 10% increase or decrease in the exchange rate of these four currencies as at 30 June 2024 would result in a variation in the fair value of the portfolio as shown in the table below:
| IN MILLION EUR | |||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| USD | GBP | INR | DKK | CNY | |||||||||||
| Exchange rate sensitivity |
−10% 0% +10% −10% 0% +10% −10% 0% +10% −10% 0% +10% −10% 0% +10% | ||||||||||||||
| Fair value | 5,979 5,381 4,892 729 656 596 | 603 543 493 | 170 153 139 | 22 | 19 | 18 | |||||||||
| Impact on revenue |
598 | 0 −489 | 73 | 0 −60 | 60 0 −50 | 17 | 0 | −14 | 3 | 0 | −1 |
Price risk
Price risk is defined as the risk that unfavourable changes in stock prices impact Sofina's portfolio. Sofina is exposed to market fluctuations in its portfolio.
The risk analysis of level 1 and level 2 investments is shown below. A variation interval of -10% and +10% has been applied to the valuation as at 30 June 2024. This variance influences the result.
| IN MILLION EUR | ||||||||
|---|---|---|---|---|---|---|---|---|
| Stock price sensitivity | LEVEL 1 | LEVEL 2 | ||||||
| −10% | 0% | +10% | −10% | 0% | +10% | |||
| Fair value | 479 | 533 | 586 | 19 | 21 | 22 | ||
| Impact on revenue | −53 | 0 | 53 | −2 | 0 | 2 |
Interest rate risk and liquidity risk
The interest rate risk is the risk that the interest flow on the financial debt and the gross cash flow may be adversely affected by an unfavourable change in interest rates. In the case at hand, the risk is limited as the financial liabilities are mainly at fixed rates. Moreover, Sofina's net cash position is positive. However, Sofina has commitments to disburse funds in relation to the Sofina Private Funds investments.
Considering its positive net cash position, the existence of bank credit lines (unused – please refer to point 3.14), the investments in shares listed on liquid markets and therefore easily realisable (in the Sofina Direct investments and Sofina Private Funds portfolios), and if need be the ability to transact on the secondary market for Sofina Private Funds, the liquidity risk faced by Sofina is extremely moderate.
| IN MILLION EUR | ||
|---|---|---|
| PRIVATE FUNDS RESIDUAL COMMITMENT BRIDGE | 30/06/2024 | 31/12/2023 |
| Beginning of the period | 1,300 | 1,336 |
| New commitments | 213 | 306 |
| Investments | −172 | −291 |
| Other 1 | 6 | −25 |
| FX impact | 39 | −26 |
| End of the period 2 | 1,386 | 1,300 |
Credit risk
The credit risk is the counterparty risk on gross cash. It is mitigated by an adequate counterparty diversification (credit rating and duration, counterparty, issuer, sector limit exposure).
Concentration risk
The 10 largest investments of Sofina Direct represent 30% of the fair value of the portfolio in transparency 3 :
| 1 | Petit Forestier Group |
|---|---|
| 2 | Lernen Midco 1 (Cognita) |
| 3 | Drylock Technologies |
| 4 | HSC Co-Investment 2016-A (ByteDance) |
| 5 | Nuxe International |
| 6 | Cambridge Associates |
| 7 | bioMérieux |
| 8 | MNH (Mérieux NutriSciences) |
| 9 | Biobest Group (BioFirst) 4 |
| 10 | Salto Systems |
1 Other mainly comprises recallable distributions, disposals and termination of funds with residual uncalled commitments.
- 2 Additional residual commitments in relation to Sofina Direct investments of EUR 8 million as at 30 June 2024 and of EUR 196 million as at 31 December 2023 bring the total uncalled commitments to EUR 1,394 million and EUR 1,496 million. respectively.
- 3 Largest investments in terms of representation in the fair value of the portfolio in transparency and following the valuation principles set in point 2.3 above. Listed in decreasing order of fair value at 30 June 2024. The ranking of our Sofina Direct investments does not take into consideration indirect holdings in these entities through certain investments of Sofina Private Funds.
- 4 Biobest Group (BioFirst) regroups Biobest Group SA and MxBEE, an investment vehicle whose sole asset is a shareholding in Biobest Group SA. The ranking therefore consists of the fair value in transparency of Biobest Group SA and MxBEE.
Accounts and notes
• Independent auditor's report
It should be noted that:
• the 4 largest investments of Sofina Direct represent more than 15% but less than 20% of the portfolio in transparency whereas the 6 largest investments represent more than 20% of the portfolio in transparency 1.
• out of the above-listed investments taken individually, when taking into account our combined holdings through Sofina Direct and Sofina Private Funds 2 when applicable, Petit ForestierGroup 3 and Bytedance 4 are the sole assets representing more than 5% of the fair value of the portfolio in transparency 1.
There are no dominant positions. The level 3 investments in the top 10 are valued according to the Discounted Cash Flow model, market multiples or the most recent transaction method as described in point 2.3 above.
The 10 largest General Partners of Sofina Private Funds represent 22% 5 of the fair value of the portfolio in transparency 6 :
| 1 | Sequoia Capital |
|---|---|
| 2 | HongShan |
| 3 | Lightspeed |
| 4 | Peak XV |
| 5 | Insight |
| 6 | Battery |
| 7 | Thoma Bravo |
| 8 | Iconiq Capital |
| 9 | TA Associates |
| 10 | Andreessen Horowitz |
War in Ukraine
As per ESMA's recommendation of 14 March 2022 Public Statement of 13 May 2022 on Implications of Russia's invasion of Ukraine on annual financial reports, and Public Statement of 28 October 2022 on the European common enforcement priorities for 2022 annual financial reports, Sofina can confirm that it has very limited specific exposure to the Ukraine crisis, which has had no material direct impact on its activities. The group is not impacted by the economic sanctions enforced by the European Union. Sofina Direct portfolio companies with notable operations or exposure in Ukraine or Russia and Belarus represent less than 4% of total portfolio fair value in transparency as at 30 June 2024. Based on check performed on 2022, Sofina Private Funds is marginally exposed to underlying companies with some presence in Ukraine or in Russia and Belarus which are estimated to represent a small proportion of total number of companies in the underlying portfolio. General Partners have investigated their potential Russian ties including tracing Russian money in their investors base and they have not reported any significant issue in this respect. The main potential economic consequences of the Ukraine crisis on the portfolio are not specific in nature as they relate to its impact on raw material prices including energy, potential supply chain disruptions, concerns about an increasing risk of cyber-attacks and more generally, the macro-economic impact on GDP growth, inflation and interest rates.
1 Largest investments in terms of representation in the fair value of the portfolio in transparency and following the valuation principles set in point 2.3 above. Listed in decreasing order of fair value at 30 June 2024. The ranking of our Sofina Direct investments does not take into consideration indirect holdings in these entities through certain partnerships of Sofina Private Funds.
- 2 The valuation of such investments through Sofina Private Funds is based either on a report as at 30 June 2024 or on a report as at 31 March 2024.
- 3 Sofina values its holding in Groupe Petit Forestier on the basis of the sale price.
- 4 Sofina values its holding in HSC Co-Investment 2016-A on the basis of the market multiples valuation method with an illiquidity discount. Its holding in ByteDance at Sofina Private Funds level is valued on the basis of the latest reports (where the information is available) obtained from the General Partners.
- 5 Since 2023, the list of the 10 largest General Partners of Sofina Private Funds presents Sequoia as three different Managers following the recent split of the Chinese (HongShan) and Indian branches (Peak XV).
- 6 Largest General Partners in terms of estimated representation of their funds in the fair value of Sofina's portfolio in transparency. Listed in decreasing order of fair value at 30 June 2024.
| Our mission | ||
|---|---|---|
Accounts and notes
- Consolidated financial statements
- Notes to the consolidated financial statements
- • Independent auditor's report
Glossary
2.6 GEOGRAPHICAL, SECTORAL AND STRATEGY SPLIT OF THE PORTFOLIO IN TRANSPARENCY
Portfolio split by geographic region 1
| IN MILLION EUR | ||||||||
|---|---|---|---|---|---|---|---|---|
| 30/06/2024 | 31/12/2023 | |||||||
| GEOGRAPHIC REGION | PORTFOLIO FAIR VALUE |
RESIDUAL PORTFOLIO COMMITMENTS 2 FAIR VALUE |
RESIDUAL COMMITMENTS |
|||||
| Sofina Direct | ||||||||
| North America | 600 | 11% | 2 | 25% | 538 | 11% | 2 | 1% |
| Western Europe | 3,356 | 65% | 3 | 38% | 2,960 | 63% | 193 | 98% |
| Asia | 1,223 | 24% | 3 | 37% | 1,227 | 26% | 1 | 1% |
| Other | 11 | 0% | 0 | 0% | 14 | 0% | 0 | 0% |
| Total Sofina Direct | 5,190 | 100% | 8 | 100% | 4,739 | 100% | 196 | 100% |
| Sofina Private Funds | ||||||||
| North America | 2,815 | 64% | 843 | 61% | 2,608 | 62% | 786 | 60% |
| Western Europe | 430 | 10% | 200 | 14% | 419 | 10% | 180 | 14% |
| Asia | 1,153 | 26% | 343 | 25% | 1,162 | 28% | 334 | 26% |
| Total Sofina Private Funds | 4,398 | 100% | 1,386 | 100% | 4,189 | 100% | 1,300 | 100% |
| TOTAL SOFINA DIRECT AND SOFINA PRIVATE FUNDS |
||||||||
| North America | 3,415 | 36% | 845 | 61% | 3,146 | 35% | 788 | 53% |
| Western Europe | 3,786 | 39% | 203 | 14% | 3,379 | 38% | 373 | 25% |
| Asia | 2,376 | 25% | 346 | 25% | 2,389 | 27% | 335 | 22% |
| Other | 11 | 0% | 0 | 0% | 14 | 0% | 0 | 0% |
| TOTAL OF THE PORTFOLIO 3 | 9,588 | 100% | 1,394 | 100% | 8,928 | 100% | 1,496 | 100% |
Split of Sofina Direct by sector
The table below shows the sectoral breakdown of Sofina Direct as at 30 June 2024 and as at 31 December 2023 3 :
| IN MILLION EUR | |||||||
|---|---|---|---|---|---|---|---|
| 30/06/2024 PORTFOLIO FAIR VALUE |
31/12/2023 | ||||||
| SECTOR | PORTFOLIO FAIR VALUE | ||||||
| Consumer and retail | 1,461 | 28% | 1,415 | 30% | |||
| Digital transformation | 1,132 | 22% | 976 | 21% | |||
| Education | 625 | 12% | 526 | 11% | |||
| Healthcare and life sciences | 615 | 12% | 607 | 13% | |||
| Sustainable supply chain | 267 | 5% | 253 | 5% | |||
| Other | 1,090 | 21% | 962 | 20% | |||
| Total | 5,190 | 100% | 4,739 | 100% |
Split of Sofina Private Funds by strategy
| IN MILLION EUR | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 30/06/2024 | 31/12/2023 | ||||||||
| STRATEGY | PORTFOLIO FAIR VALUE |
RESIDUAL COMMITMENTS 4 |
PORTFOLIO FAIR VALUE |
COMMITMENTS | RESIDUAL | ||||
| Venture capital | 3,075 | 70% | 816 | 59% | 2,913 | 70% | 769 | 59% | |
| Growth equity | 1,064 | 24% | 462 | 33% | 1,042 | 25% | 465 | 36% | |
| LBO | 243 | 6% | 100 | 7% | 228 | 5% | 58 | 4% | |
| Other | 16 | 0% | 8 | 1% | 6 | 0% | 8 | 1% | |
| Total 5 | 4,398 | 100% | 1,386 | 100% | 4,189 | 100% | 1,300 | 100% |
1 Based on the portfolio in transparency considering the country of the main or historical headquarters of the investment.
2 These amounts come mainly from subscriptions to investments by Sofina Private Funds amounting to EUR 1,386 million (see point 3.14 below). These commitments are subscribed by Sofina SA or by its investment subsidiaries (seen in transparency).
3 Based on the fair value of the Sofina group's investments as at 30 June 2024 and as at 31 December 2023 (portfolio in transparency – see point 2.4 above).
4 Sofina is committed to responding to capital calls by certain private funds (see point 3.14 below).
5 Information on the Sofina Private Funds portfolio shown in the balance sheet as at 30 June 2024 can be found under point 2.1 above.
Portfolio split by vintage
| 30/06/2024 | 31/12/2023 | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| VINTAGE | PORTFOLIO FAIR | VALUE | COMMITMENTS 1 | RESIDUAL | PORTFOLIO FAIR VALUE |
RESIDUAL COMMITMENTS |
||||
| Our mission | Sofina Direct | |||||||||
| Message to shareholders | 0-3 | 1,177 | 23% | 2 | 23% | 950 | 20% | 190 | 97% | |
| 4-7 | 2,178 | 42% | 3 | 38% | 1,931 | 41% | 3 | 1% | ||
| Highlights | 8-10 | 950 | 18% | 3 | 39% | 950 | 20% | 3 | 2% | |
| We are Sofina | >10 | 885 | 17% | 0 | 0% | 908 | 19% | 0 | 0% | |
| Total Sofina Direct | 5,190 | 100% | 8 | 100% | 4,739 | 100% | 196 | 100% | ||
| Half-year in review | Sofina Private Funds | |||||||||
| Accounts and notes | 0-3 | 982 | 22% | 1,151 | 83% | 768 | 18% | 1,050 | 81% | |
| 4-7 | 1,962 | 45% | 167 | 12% | 1,927 | 46% | 182 | 14% | ||
| • Consolidated financial | 8-10 | 942 | 21% | 37 | 3% | 984 | 24% | 36 | 3% | |
| statements | >10 | 512 | 12% | 31 | 2% | 510 | 12% | 32 | 2% | |
| • Notes to the consolidated | Total Sofina Private Funds | 4,398 | 100% | 1,386 | 100% | 4,189 | 100% | 1,300 | 100% | |
| financial statements | TOTAL SOFINA DIRECT AND SOFINA PRIVATE FUNDS |
|||||||||
| • Independent | 0-3 | 2,159 | 23% | 1,153 | 83% | 1,718 | 19% | 1,240 | 83% | |
| auditor's report | 4-7 | 4,140 | 43% | 170 | 12% | 3,858 | 43% | 185 | 12% | |
| 8-10 | 1,892 | 20% | 40 | 3% | 1,934 | 22% | 39 | 3% | ||
| Glossary | >10 | 1,397 | 14% | 31 | 2% | 1,418 | 16% | 32 | 2% | |
| TOTAL OF THE PORTFOLIO 2 | 9,588 | 100% | 1,394 | 100% | 8,928 | 100% | 1,496 | 100% |
1 Sofina is committed to responding to capital calls by certain private funds (see point 3.14 below).
2 Information on the Sofina Private Funds portfolio shown in the balance sheet as at 30 June 2024 can be found under point 2.1 above.
IN MILLION EUR
Our mission Message to shareholders Highlights We are Sofina Half-year in review Accounts and notes
• Independent auditor's report
3. Notes to the financial statements as an Investment Entity
3.1 INVESTMENT PORTFOLIO
| IN THOUSAND EUR | ||
|---|---|---|
| 30/06/2024 | 31/12/2023 | |
| Investments | ||
| Net value at the beginning of the period | 8,548,378 | 8,538,603 |
| Acquisitions during the period | 1,507,537 | 774,158 |
| Disposals during the period | −323,364 | −223,245 |
| Changes in unrealised gains in profit and loss | 440,693 | 209,934 |
| Changes in unrealised losses in profit and loss | −669,607 | −751,072 |
| Net value at the end of the period = 1 | 9,503,637 | 8,548,378 |
| Receivables | ||
| Net value at the beginning of the period | 62,066 | 1,380 |
| Acquisitions during the period | 71 | 75,067 |
| Disposals during the period | 0 | 0 |
| Changes in unrealised gains in profit and loss | 1,952 | 0 |
| Changes in unrealised losses in profit and loss | 0 | −14,706 |
| Changes in accrued interest not yet due | 338 | 325 |
| Net value at the end of the period = 2 | 64,427 | 62,066 |
| Net value = 1 + 2 | 9,568,064 | 8,610,444 |
The difference between the amount of acquisitions during the period (EUR 1,507,537 thousand) and the amount of portfolio investments in the consolidated cash flows statement (EUR 356,837 thousand) is mainly due to a non-cash investment of 2024 for a total amount of EUR -1,150,868 thousand. The difference between the amount of the disposals during the period (EUR 323,364 thousand) and the amount of the divestments shown in the consolidated cash flow statement (EUR 185,672 thousand) is mainly due to the capital gains and losses realised on these divestments amounting to EUR -34,788 thousand, and a non-cash divestment and a deferred cash payment of 2024 for a total of EUR -102,904 thousand. In addition, the capital gains and losses realised (EUR -34,788 thousand) combined with the changes in unrealised capital gains and losses (EUR -288,915 thousand) form the net result of the investment portfolio (see point 3.11 below).
Accounts and notes
• Consolidated financial statements
• Notes to the consolidated financial statements
• Independent auditor's report
| 3.2 CLASSIFICATION OF FINANCIAL INSTRUMENTS | |||||
|---|---|---|---|---|---|
| --------------------------------------------- | -- | -- | -- | -- | -- |
| IN THOUSAND EUR | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| BOOK VALUE | FAIR VALUE | BOOK VALUE | FAIR VALUE | ||||||
| IFRS 9 CLASSIFICATION | TOTAL AS AT 30/06/2024 |
LEVEL 1 LEVEL 2 | LEVEL 3 TOTAL AS AT 31/12/2023 |
LEVEL 1 | LEVEL 2 | LEVEL 3 | |||
| Investment portfolio | 9,568,064 | 330,152 | 0 | 9,237,912 | 8,610,444 | 337,441 | 44,135 | 8,228,868 | |
| Investments | Fair value through profit and loss | 9,503,637 | 330,152 | 0 | 9,173,485 | 8,548,378 | 337,441 | 44,135 | 8,166,802 |
| Receivables | Designated at fair value through profit and loss | 64,427 | 0 | 0 | 64,427 | 62,066 | 0 | 0 | 62,066 |
| Receivables from subsidiaries 1 | Designated at fair value through profit and loss | 75,736 | 0 | 75,736 | 0 | 495,153 | 0 | 495,153 | 0 |
| Deposits and other current financial assets |
475,376 | 0 | 475,376 | 0 | 527,970 | 0 | 527,970 | 0 | |
| Deposits | Designated at fair value through profit and loss | 75,000 | 0 | 75,000 | 0 | 0 | 0 | 0 | 0 |
| Current financial investments |
Fair value through profit and loss | 388,477 | 0 | 388,477 | 0 | 514,257 | 0 | 514,257 | 0 |
| Other receivables | Designated at fair value through profit and loss | 11,899 | 0 | 11,899 | 0 | 13,713 | 0 | 13,713 | 0 |
| Cash and cash equivalents | Designated at fair value through profit and loss | 135,432 | 0 | 135,432 | 0 | 198,342 | 0 | 198,342 | 0 |
| Non-current financial liabilities | At amortised cost | 696,679 | 0 | 620,001 | 0 | 696,289 | 0 | 590,772 | 0 |
| Current financial liabilities | At amortised cost | 5,370 | 0 | 5,370 | 0 | 2,109 | 0 | 2,109 | 0 |
| Other current receivables | At amortised cost | 97 | 0 | 97 | 0 | 101 | 0 | 101 | 0 |
| Payables to subsidiaries 1 | Designated at fair value through profit and loss | 2,514 | 0 | 2,514 | 0 | 55,980 | 0 | 55,980 | 0 |
| Trade and other current payables |
At amortised cost | 49,874 | 0 | 49,874 | 0 | 4,396 | 0 | 4,396 | 0 |
During this half-year there were no level transfers.
1 Receivables from and payables to subsidiaries are designated at fair value but as they are short-term receivables and payables, there is no change in fair value to record.
Accounts and notes
- Consolidated financial statements
- Notes to the consolidated financial statements
- • Independent auditor's report
The fair value of the items of the investment portfolio can be prioritised as follows:
Assets valued under level 1 are valued at the stock market price at the balance sheet closing date. Level 2 data are data on the assets or liabilities other than listed prices included in level 1 data which are observable either directly or indirectly. Level 3 data are unobservable data on the assets or liabilities.
Direct shareholdings in investment subsidiaries are considered to be level 3 and are valued based on the fair value of their own portfolio (level 1, 2 or 3) and the fair value of their other assets and liabilities. A detailed description of the valuation methods and the sensitivity of the fair value is given in points 2.3 and 2.4 above. The portfolio held in transparency is described under point 2.2 above.
The fair value of the other financial instruments has been determined using the following methods:
- for short-term financial instruments, such as trade receivables and payables, the fair value is considered not to be significantly different from the carrying amount at amortised cost;
- for short-term loans and borrowings, such as deposits or receivables from or payables to subsidiaries, the fair value is considered not to be significantly different from the carrying amount at amortised cost;
- for long-term loans, the fair value of a debt investment, in the absence of actively traded prices, is generally derived from a yield analysis taking into account credit quality, coupon and term as well as applying the calibration principle;
- for foreign exchange rate or interest rate derivatives, fair value is determined based on models that discount future cash flows based on future interest rate curves or foreign exchange rates or other forward prices.
Financial risks
A description of the financial risks can be found in point 2.5 above.
Details of movements for financial investments recognised at fair value in level 3
| IN THOUSAND EUR | ||
|---|---|---|
| INVESTMENT PORTFOLIO | 30/06/2024 | 31/12/2023 |
| Net value at the beginning of the period | 8,228,868 | 8,150,888 |
| Acquisitions during the period | 1,414,081 | 849,226 |
| Disposals during the period | −221,070 | −181,751 |
| Changes in unrealised gains in profit and loss | 441,781 | 174,873 |
| Changes in unrealised losses in profit and loss | −626,086 | −764,692 |
| Changes in accrued interest not yet due | 338 | 324 |
| Transfer to level 3 | 0 | 0 |
| Transfer from level 3 | 0 | 0 |
| Net value at the end of the period | 9,237,912 | 8,228,868 |
3.3 DEPOSITS AND OTHER CURRENT FINANCIAL ASSETS
| IN THOUSAND EUR | |||
|---|---|---|---|
| 30/06/2024 | 31/12/2023 | ||
| Deposits 1 | 75,000 | 0 | |
| Current financial investments | 388,477 | 514,257 | |
| Other receivables | 11,899 | 13,713 | |
| Deposits and other current financial assets | 475,376 | 527,970 |
Current financial assets are measured at fair value through profit and loss.
3.4 CASH AND CASH EQUIVALENTS
| IN THOUSAND EUR | ||
|---|---|---|
| 30/06/2024 | 31/12/2023 | |
| Bank and cash | 41,429 | 112,908 |
| Short-term investments and deposits | 94,003 | 85,434 |
| Cash and cash equivalents | 135,432 | 198,342 |
Cash and cash equivalents consist of bank balances, cash on hand and investments in money market instruments with a maximum term of three months.
3.5 SHARE CAPITAL
| IN THOUSAND EUR | ||||
|---|---|---|---|---|
| SHARE CAPITAL | TREASURY SHARES | |||
| NUMBER OF SHARES |
AMOUNT OF CAPITAL |
NUMBER OF SHARES |
AMOUNT OF CAPITAL HELD |
|
| Balances as at 31/12/2022 | 34,250,000 | 79,735 | 917,928 | 2,137 |
| Changes during the year | 0 | 0 | 135,000 | 314 |
| Balances as at 31/12/2023 | 34,250,000 | 79,735 | 1,052,928 | 2,451 |
| Changes during the period | 0 | 0 | 64,096 | 149 |
| Balances as at 30/06/2024 | 34,250,000 | 79,735 | 1,117,024 | 2,600 |
The subscribed and fully paid-up capital consists of ordinary shares without nominal value. The owners of ordinary shares are entitled to receive dividends and are entitled to one vote per share at the Company's general meetings of shareholders. The gross dividend for the financial year 2023, paid in 2024, was EUR 3.35 per share, i.e. a total gross amount of EUR 111,236 thousand. As at 30 June 2024, Sofina SA held 1,117,024 own shares, compared with 1,052,928 own shares held as at 31 December 2023. During the year 2024, 156,586 own shares were acquired, and 92,490 own shares were disposed of.
1 Deposits between three months and one year.
Accounts and notes
• Independent auditor's report
3.6 NON-CURRENT FINANCIAL LIABILITIES
| IN THOUSAND EUR | ||
|---|---|---|
| 30/06/2024 | 31/12/2023 | |
| Bonds issued | 696,679 | 696,289 |
| Non-current financial liabilities | 696,679 | 696,289 |
The non-current financial liabilities result from a bond issuance amounting to EUR 700,000 thousand, maturing in 2028. The bonds bear an annual interest rate of 1% payable annually on the coupon due date.
3.7 FINANCIAL LIABILITIES, TRADE AND OTHER CURRENT PAYABLES
| IN THOUSAND EUR | ||
|---|---|---|
| 30/06/2024 | 31/12/2023 | |
| Bank loans | 0 | 0 |
| Payables to subsidiaries | 2,514 | 55,980 |
| Trade payables | 8,945 | 1,398 |
| Wage and social security payables | 1,018 | 1,646 |
| Current financial liabilities 1 | 5,370 | 2,109 |
| Other miscellaneous liabilities 2 | 38,593 | 162 |
| Dividends relating to previous years | 863 | 868 |
| Miscellaneous taxes | 456 | 322 |
| Financial liabilities, trade and other current payables | 57,759 | 62,485 |
3.8 RECEIVABLES FROM AND PAYABLES TO SUBSIDIARIES
| IN THOUSAND EUR | ||
|---|---|---|
| 30/06/2024 | 31/12/2023 | |
| Receivables from subsidiaries 3 | 75,736 | 495,153 |
| Payables to subsidiaries 4 | −2,514 | −55,980 |
| Receivables from and payables to subsidiaries | 73,222 | 439,173 |
Sofina SA has signed revolving credit facilities agreements with commitment with several of its subsidiaries. The loans thereby granted by Sofina SA to these subsidiaries bear interest at Euribor +3 months plus a margin.
With regard to its payables (deposits made by subsidiaries), Sofina SA remunerates them at a deposit rate that is reviewed regularly.
3.9 DIVIDENDS
| IN THOUSAND EUR | |||
|---|---|---|---|
| 1ST SEMESTER 2024 | 1ST SEMESTER 2023 | ||
| Dividends received from non-consolidated related companies 5 |
813,276 | 0 | |
| Dividends received from associated companies | 5,050 | 8,686 | |
| Dividends received from other companies | 6,077 | 3,050 | |
| Dividends | 824,403 | 11,736 |
3.10 INTEREST INCOME AND EXPENSES
| IN THOUSAND EUR | |||
|---|---|---|---|
| 1ST SEMESTER 2024 | 1ST SEMESTER 2023 | ||
| Interest on non-current assets | 409 | 33 | |
| Interest on receivables from subsidiaries 6 | 8,367 | 12,126 | |
| Interest on current assets | 3,941 | 2,143 | |
| Interest on debts to subsidiaries | −203 | 0 | |
| Interest to banks | −169 | 0 | |
| Interest on other liabilities 7 | −3,861 | −3,858 | |
| Interest income and expenses | 8,484 | 10,444 |
1 Composed of accrued interest related to the bonds (see point 3.6 above).
2 The amount includes a debt related to the acquisition of treasury shares for EUR 9,444 thousand.
- 3 The amount for 2024 consists of revolving credit facilities contracts for EUR 74,630 thousand and trade receivables from subsidiaries for an amount of EUR 1,106 thousand.
- 4 The amount for 2024 consists mainly of a current debt to a subsidiary for an amount of EUR 2,389 thousand, and trade payables to subsidiaries for an amount of EUR 125 thousand.
5 Difference compared with the dividends presented in the consolidated cash flow statement is mainly due to cut-offs between declaration and payment periods, due to certain transactions with a counterparty of contribution in kind or to withholding taxes.
6 For details, see point 3.8 above.
7 Composed of accrued interest related to the bonds (see point 3.6 above).
Accounts and notes
- Consolidated financial statements
- Notes to the consolidated financial statements
- • Independent auditor's report
3.11 NET REVENUE OF THE INVESTMENT PORTFOLIO
Realised capital gains on investments come mainly from sales of Sibelco shares.
Realised capital loss on investments come mainly from one investment active in healthcare.
Unrealised capital gains on investments mainly come from investments active in rental of refrigerated vehicles, from our subsidiaries Sofina US, Sofina Ventures and Sofina Invest, and from other investments active in personal hygiene products and healthcare.
Unrealised capital losses on investments come mainly from our subsidiary Sofina Capital and other investments active in biological crop protection and online education.
| IN THOUSAND EUR | |||
|---|---|---|---|
| 1ST SEMESTER 2024 | 1ST SEMESTER 2023 | ||
| Investments | |||
| Results realised upon disposals | −34,788 | −129 | |
| Capital gains | 7,082 | 0 | |
| Capital losses | −41,870 | −129 | |
| Unrealised results | −228,915 | −250 | |
| Capital gains | 440,692 | 218,967 | |
| Capital losses | −669,607 | −219,217 | |
| Total investments | −263,703 | −379 | |
| Receivables | |||
| Results realised upon disposals | 0 | 0 | |
| Capital gains | 0 | 0 | |
| Capital losses | 0 | 0 | |
| Unrealised results | 1,952 | 0 | |
| Capital gains | 1,952 | 0 | |
| Capital losses | 0 | 0 | |
| Total receivables | 1,952 | 0 | |
| Net result of the investment portfolio | −261,751 | −379 |
3.12 OTHER FINANCIAL RESULTS
| IN THOUSAND EUR | |||
|---|---|---|---|
| 1ST SEMESTER 2024 1ST SEMESTER 2023 | |||
| Foreign exchange results | −107 | 959 | |
| Results on other current assets | 10,683 | 8,377 | |
| Other financial results | 10,576 | 9,336 |
3.13 OTHER EXPENSES
| IN THOUSAND EUR | ||
|---|---|---|
| 1ST SEMESTER 2024 1ST SEMESTER 2023 | ||
| Other financial expenses | −1,762 | −1,053 |
| Services and other goods | −13,783 | −8,013 |
| Remuneration, social security charges and pensions | −14,481 | −6,958 |
| Miscellaneous | −1,797 | −1,964 |
| Other expenses | −31,822 | −17,988 |
Services and other goods mainly comprise consultancy services received.
Accounts and notes
• Independent auditor's report
| 3.14 OFF-BALANCE SHEET RIGHTS AND COMMITMENTS | ||||
|---|---|---|---|---|
| IN THOUSAND EUR | ||||
| 30/06/2024 | 31/12/2023 | |||
| FOREIGN CURRENCY |
EUR | FOREIGN CURRENCY |
EUR |
| FOREIGN CURRENCY |
EUR | FOREIGN CURRENCY |
EUR | ||
|---|---|---|---|---|---|
| Investment portfolio, uncalled committed amounts 1 |
EUR | 72,480 | 121,520 | ||
| CAD | 109 | 74 | 154 | 105 | |
| USD | 1,397,216 | 1,305,199 | 1,333,461 | 1,206,753 | |
| GBP | 12,111 | 14,309 | 15,703 | 18,069 | |
| DKK | 0 | 0 | 1,119,487 | 150,208 | |
| INR | 166,216 | 1,863 | 0 | 0 | |
| 1,393,925 | 1,496,655 | ||||
| Obtained credit lines | 1,125,000 | 1,125,000 | |||
| Used amount | 0 | 0 | |||
| Unused amount | 1,125,000 | 1,125,000 | |||
| Credit lines granted to the investment subsidiaries |
1,075,000 | 965,000 | |||
| Used amount | 74,529 | 266,549 | |||
| Unused amount | 1,000,471 | 698,451 |
3.15 RELATED PARTY TRANSACTIONS
| IN THOUSAND EUR | ||
|---|---|---|
| ASSETS AND LIABILITIES | 30/06/2024 | 31/12/2023 |
| Long-term receivables from non-consolidated related companies |
0 | 0 |
| Short-term receivables from non-consolidated related companies |
75,736 | 495,153 |
| Payables to non-consolidated related companies | −2,514 | −55,980 |
| RESULTS FROM RELATED PARTY TRANSACTIONS | 1ST SEMESTER 2024 1ST SEMESTER 2023 | |
|---|---|---|
| Dividends received from non-consolidated related companies |
813,276 | 0 |
| Dividends received from associated companies | 5,050 | 8,686 |
| Interest received from non-consolidated related companies |
8,367 | 12,126 |
| Interest paid to non-consolidated related companies | −203 | 0 |
| Services provided to non-consolidated related companies |
818 | 818 |
| Services received from non-consolidated related companies |
−544 | −380 |
The receivables from and payables to non-consolidated related companies consist mainly of loans and deposits between Sofina and its subsidiaries. Their remuneration methods are detailed in point 3.8 above.
The services provided mainly include investment services and investment advisory services relating to investment opportunities and investments held by the service recipient.
The services received consist mainly of cash management services.
Sofina is the guarantor of the commitments of its non-consolidated related companies (i.e. its subsidiaries).
3.16 POST-CLOSING DATE EVENTS
Events after the end of the financial year are listed in the Half-year in review section, which forms an integral part of the interim Management report.
1 These amounts come mainly from subscriptions to investments by Sofina Private Funds amounting to EUR 1,386 million (see point 2.6 above). These commitments are subscribed by Sofina SA or by its investment subsidiaries (view in transparency).
Message to shareholders Highlights
Accounts and notes
- Consolidated financial statements
- Notes to the consolidated financial statements
- • Independent auditor's report
| 3.17 LIST OF SUBSIDIARIES AND ASSOCIATED COMPANIES | |||
|---|---|---|---|
| -- | -- | ---------------------------------------------------- | -- |
| CORPORATE RIGHTS HELD | CORPORATE RIGHTS HELD | |||||
|---|---|---|---|---|---|---|
| NAME AND HEADQUARTERS | LINK | NUMBER OF SHARES |
% OWNERSHIP AS AT 30/06/2024 |
NUMBER OF SHARES |
% OWNERSHIP AS AT 31/12/2023 |
|
| A. INVESTMENT SUBSIDIARIES - AT FAIR VALUE | ||||||
| Global Education Holding SA 12, rue Léon Laval - LU-3372 Leudelange |
Indirect | 277,262 | 82.01 | 277,262 | 82.01 | |
| Sofina Asia Private Ltd. 108 Amoy Street # 03-01 - SG-069928 Singapore |
Direct | 705,000 | 100 | 615,000 | 100 | |
| Sofina Capital SA 12, rue Léon Laval - LU-3372 Leudelange |
Direct | 5,872,576 | 100 | 5,872,576 | 100 | |
| Sofina Invest SA 12, rue Léon Laval - LU-3372 Leudelange |
Direct | 30,000 | 100 | 0 | 0 | |
| Sofina Global SA SIF 12, rue Léon Laval - LU-3372 Leudelange |
Indirect | 17,500,000 | 100 | 17,500,000 | 100 | |
| Sofina Partners SA 12, rue Léon Laval - LU-3372 Leudelange |
Indirect | 46,668,777 | 100 | 46,668,777 | 100 | |
| Sofina Private Equity SA SICAR 12, rue Léon Laval - LU-3372 Leudelange |
Indirect | 5,910,000 | 100 | 5,910,000 | 100 | |
| Sofina US, LLC 160 Federal Street, 9th floor - MA 02110 Boston - USA |
Direct | 802,000 | 100 | 802,000 | 100 | |
| Sofina Ventures SA 29, rue de l'Industrie - 1040 Brussels Company number 0423 386 786 |
Direct | 11,709 | 100 | 11,709 | 100 | |
| B. ASSOCIATED COMPANIES - AT FAIR VALUE | ||||||
| Cambridge Associates 125 High Street - MA 02110 Boston - USA |
Indirect | 24,242 | 24.01 | 24,242 | 23.68 | |
| Dott HoldCo (Dott) Diemenstraat 292 - 1013 CR Amsterdam - Netherlands |
Indirect | 17,371,386 | 20.22 | 0 | 0 | |
| Drylock Technologies Spinnerijstraat 12- 9240 Zele Company number 0479 766 057 |
Direct | 169,782,750 | 25.00 | 169,782,750 | 25.00 | |
| Green E Origin 4, rue du Fort Wallis - LU-2714 Luxembourg |
Indirect | 279,851 | 24.51 | 279,851 | 25 | |
| Petit Forestier Group 11, route de Tremblay - 93420 Villepinte - France |
Direct | 976,838 | 33.62 | 976,838 | 33.62 | |
| MXP Prime Platform (SellerX) Jägerstraße 41 - 10117 Berlin - Germany |
Indirect | 1,284,209 | 26.09 | 1,284,209 | 26.09 | |
| Nuxe International 127, rue d'Aguesseau - 92100 Boulogne-Billancourt - France |
Indirect | 193,261,167 | 49.00 | 193,261,167 | 49.00 | |
| Polygone 59, Quai Rambaud - 69002 Lyon - France |
Direct | 0 | 0.00 | 221,076 | 20.96 |
Considering Sofina's compliance with the conditions laid down in Article 70 of the Luxembourg law of 19 December 2002, Luxembourg subsidiaries (except Sofina Private Equity SA SICAR and Sofina Global SA SIF) may be exempted from certain provisions relating to the publication of their statutory annual accounts.
Accounts and notes
• Independent auditor's report
3.18 SUMMARY OF MATERIAL ACCOUNTING POLICIES
The following new standards and interpretations became effective in 2024:
- Amendments to IAS 1 Presentation of Financial Statements: Classification of Liabilities as Current or Non-current Liabilities with Covenants (applicable for annual periods beginning on or after 1st January 2024);
- Amendments to IFRS 16 Leases: Lease Liability in a Sale and Leaseback (applicable for annual periods beginning on or after 1st January 2024); and
- Amendments to IAS 7 Statement of Cash Flows and IFRS 7 Financial Instruments: Disclosures: Supplier Finance Arrangements (applicable for annual periods beginning on or after 1st January 2024).
The application of these standards and interpretations does not, however, have any material impact on the financial statements of Sofina.
Sofina has not anticipated the application of the new and amended standards and interpretations not yet applicable for the annual periods beginning on or after 1st January 2024:
- Amendments to IAS 21 The Effects of Changes in Foreign Exchange Rates: Lack of Exchangeability (applicable for annual periods beginning on or after 1st January 2025, but not yet endorsed in the EU);
- IFRS 18 Presentation and Disclosure in Financial Statements (applicable for annual periods beginning on or after 1st January 2027, but not yet endorsed in the EU);
- IFRS 19 Subsidiaries without Public Accountability Disclosures (applicable for annual periods beginning on or after 1st January 2027, but not yet endorsed in the EU); and
- Amendments to IFRS 9 and IFRS 7 Classification and Measurement of Financial Instruments (applicable for annual periods beginning on or after 1st January 2026, but not yet endorsed in the EU).
The future application of these new standards and interpretations is not expected to have a significant impact on the consolidated financial statements. The impact of IFRS 18 on the presentation of the income satement shoud not be significant, but will be analysed in due course.
Basis of evaluation
The IFRS consolidated financial statements are prepared on the basis of fair value through profit and loss except for trade and employee receivables and payables, which are measured at amortised cost.
In order to reflect the significance of the data used in fair value measurements, the Sofina group classifies these measurements into a hierarchy consisting of the following levels:
- Level 1: listed prices (unadjusted) in active markets for identical assets or liabilities;
- Level 2: data other than listed prices included in level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices);
- Level 3: data for the asset or liability that are not based on observable market data (unobservable data).
Consolidation principles
In accordance with its status as an Investment Entity, Sofina does not consolidate its subsidiaries and does not apply IFRS 3 when it acquires control of another entity.
An exception to this is made for subsidiaries that only provide services related to Sofina's investment activities. These subsidiaries must be fully consolidated.
Investments in other subsidiaries, which do not exclusively provide services related to Sofina's investment activities, are also measured at fair value through profit and loss in accordance with IFRS 9.
Investments in which Sofina exercises significant influence are also measured at fair value through profit and loss in accordance with IAS 28, §18 and IFRS 9.
The list of subsidiaries and associated companies is presented above under point 3.16. This list does not include companies in which Sofina holds more than 20% of the capital without exercising significant influence, because, for example, it has neither a representative mandate on the board of directors nor veto rights (other than the usual protective rights, for reorganisations, capital increases, etc.).
Transactions in foreign currencies
Transactions in foreign currencies are accounted for at the exchange prevailing on the date of the transaction.
The impact of foreign exchange is recognised in the income statement under "Other financial income and expenses".
Monetary assets and liabilities denominated in foreign currencies are translated at closing rates. Exchange differences arising from these transactions, as well as exchange differences arising from the translation of monetary assets and liabilities denominated in foreign currencies, are recognised in the income statement. Non-monetary assets and liabilities denominated in foreign currencies are translated at the exchange rate prevailing on the transaction date.
The financial statements of foreign companies included in the consolidation are translated into euros at the closing rate for balance sheet accounts and at the average exchange rate for the year for income statement accounts. The difference resulting from the use of these two different rates is recorded in the consolidated balance sheet under "Reserves".
Accounts and notes
• Consolidated financial statements
Main foreign exchange rates
| 30/06/2024 | 31/12/2023 | |
|---|---|---|
| Closing rate | 1 EUR = | 1 EUR = |
| USD | 1.0705 | 1.1050 |
| GBP | 0.8464 | 0.8691 |
| CHF | 0.9634 | 0.9260 |
| SGD | 1.4513 | 1.4591 |
| CAD | 1.4670 | 1.4642 |
| INR | 89.2495 | 91.9045 |
| CNY | 7.7748 | 7.8509 |
| DKK | 7.4575 | 7.4529 |
(In)tangible fixed assets
(In)tangible fixed assets are recorded on the assets side of the balance sheet at their acquisition or production cost, less accumulated depreciation and any impairment losses. (In)tangible fixed assets are depreciated over their estimated useful life using the straight-line method.
- Buildings: 30 years
- Equipment and furniture: 3 to 10 years
- Rolling stock: 5 years
- Licenses: 5 years
Investments and receivables
Investments at fair value are recorded at the transaction date and are measured at fair value.
Equity investments at fair value consist of securities that are acquired with the aim of obtaining returns in the form of capital gains and/or investment income. They are measured at fair value at each balance sheet date. Unrealised gains and losses are recognised directly in the income statement. In the event of disposal, the difference between the net sale proceeds and the carrying amount is charged or credited to the income statement.
Deposits and other current financial assets
Trade receivables are measured at amortised cost. IFRS 9 requires the recognition of credit losses on all debt instruments, loans and trade receivables on the basis of their useful life. This impairment model under IFRS 9 is based on the anticipation of losses and does not have a significant impact on the measurement of impairment of financial assets.
Deposits are designated at fair value through the income statement.
Receivables from subsidiaries are designated at fair value through the income statement.
Cash and cash equivalents comprise cash and term deposits with a maturity of less than three months.
Treasury shares
Purchases and sales of treasury shares are deducted from and added to equity respectively. Changes during the period are explained in the statement of changes in equity. No result is recorded on these changes.
Employee benefits
The Sofina group's employees benefit from "defined benefit", "defined contribution" and "cash balance" pension plans. These pension plans are financed by contributions from Sofina group companies employing staff and by contributions from the staff.
For pension plans, the cost of pension obligations is determined using the "Projected Unit Credit" actuarial method for "defined benefit" plans and the "Traditional Unit Credit" method for "defined contribution" and "cash balance" plans in accordance with the principles of IAS 19. The present value of the promised benefits is calculated. This calculated present value is then compared with the existing funding and, if necessary, generates an accounting provision. The costs established by the actuaries are themselves compared with the premiums or contributions paid by the employer to the funding organisation and, if necessary, generate an additional expense in the consolidated income statement.
The amount recognised in the balance sheet corresponds to the present value of the pension obligations less the fair value of pension plan assets, in accordance with the principles of IAS 19. Actuarial differences, differences between the actual return on assets and the normative return on assets, as well as the effect of the asset ceiling (excluding the interest effect) are recognised in full in equity, without subsequent reclassification to the income statement.
Share based incentive plans granted are accounted for in accordance with IFRS 2. Under this standard, the fair value of the options at the grant date is recognised in the income statement over the vesting period. Options are valued using a generally accepted valuation model based on market conditions prevailing at the time of grant.
Financial liabilities
Derivative financial instruments are initially recorded at fair value and revalued at each balance sheet date. Changes in fair value are recognised in the income statement.
Trade payables, loans and bank overdrafts are initially measured at fair value less transaction costs directly attributable to their acquisition or issue and subsequently measured at amortised cost.
Payables to subsidiaries are designated at fair value through the income statement.
IFRS 16 – Leases: when a lease is entered into (unless it is a short-term lease or concerns a low-value asset), a liability is recognised for the related commitment, valued at amortised cost, and the related asset is recognised as property, plant and equipment.
Provisions
A provision is recognised when a legal or constructive obligation exists at the balance sheet date as a result of a past event and it is probable that an outflow of resources will be required to settle the obligation, the amount of which can be reliably estimated.
Accounts and notes
• Consolidated financial statements
Taxes
Taxes include income taxes and deferred taxes. Deferred taxes are recognised in the income statement except when they relate to items that have been recognised directly in equity, in which case they are also recognised directly in this item.
Income taxes consist of taxes payable on taxable income for the year, together with any adjustments relating to previous years.
Deferred taxes consist of income taxes payable or recoverable in future years in respect of temporary differences between the carrying amount of assets and liabilities and their tax base and in respect of unused tax loss carried forward.
Deferred tax is not recognised on temporary differences arising from goodwill that is not deductible for tax purposes, from the initial recognition of assets or liabilities in a transaction that is not a business combination and affects neither accounting nor taxable profit at the time of the transaction, or from investments in subsidiaries, provided it is probable that the temporary difference will not be reversed in the foreseeable future.
Deferred taxes on unused tax losses are recognised only to the extent that taxable profits are likely to be realised, thereby enabling the losses to be utilised.
Taxes are calculated at the tax rates that have been enacted at the closing date.
Income and expenses
Income and expenses are recognised as follows:
- The gross amounts of dividends are recognised in the income statement at the date of allocation;
- Interest income is recognised when earned;
- Interest expense is recorded as incurred;
• Gains and losses on non-current assets and gains and losses on current assets are recognised at the date of the transaction that generated them;
• Other income and expenses are recognised at the time of the transaction;
• Sofina SA provides investment management services to non-consolidated subsidiaries. Each resulting service obligation is covered by a service contract and the related revenue is recognised as the service obligation is fulfilled (over the term of the contract). Services provided by non-consolidated subsidiaries to Sofina SA are treated in the same way;
• The gross amount of income and capital gains of non-consolidated investments are recognised in the income statement.
Significant accounting judgments and sources of uncertainty in accounting estimates
The main accounting estimates relate to the valuation of the investment portfolio: the significant assumptions and judgments are discussed in the notes on the fair value of the portfolio under point 2.4 above.
The significant judgments made by Sofina when determining its status as an Investment Entity relate to the assessment of the existence of a divestment strategy on portfolio investments, as well as the assessment of this divestment strategy on investments held by subsidiaries rather than on direct investments in these subsidiaries.
Accounts and notes
- Consolidated financial statements
- Notes to the consolidated financial statements
- Independent auditor's report
STATUTORY AUDITOR'S REPORT
Statutory auditor's report to the board of directors of Sofina SA on the review of the interim condensed consolidated financial statements as at 30 June 2024 and for the six-month period then ended
Introduction
We have reviewed the accompanying consolidated balance sheet of Sofina SA as at 30 June 2024, the consolidated income statement, statement of comprehensive income, changes in consolidated shareholders 'equity and consolidated cash flow statement for the six-month period then ended, and notes ("the interim condensed consolidated financial statements"). The board of directors is responsible for the preparation and presentation of this condensed consolidated interim financial information in accordance with IAS 34, "Interim Financial Reporting" as adopted by the European Union. Our responsibility is to express a conclusion on this condensed consolidated interim financial information based on our review.
Scope of Review
We conducted our review in accordance with the International Standard on Review Engagements 2410, "Review of Interim Financial Information Performed by the Independent Auditor of the Entity". A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing 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.
Conclusion
Based on our review, nothing has come to our attention that causes us to believe that the accompanying interim condensed consolidated financial statements as at 30 June 2024 and for the six-month period then ended is not prepared, in all material respects, in accordance with IAS 34, "Interim Financial Reporting" as adopted by the European Union.
Brussels, 5 September 2024
EY Réviseurs d'Entreprises SRL Statutory auditor represented by
Jean-François Hubin * Partner *Acting on behalf of an SRL
25JFH0018
Glossary
• Average annual return: Average annual growth rate calculated on the basis of the change in equity per share (NAVPS) during the reporting period from 1st July to 30 June, taking into account the gross dividend(s) per share of Sofina. It is expressed on an annualised basis. As an example, the average annual return over one year is calculated as follows and is based on the "XIRR" formula in Excel:
| PERIOD | NAVPS (T-1) |
GROSS DIVIDEND PAID (IN EUR) |
NAVPS (T) |
PERFOR MANCE (IN %) |
|---|---|---|---|---|
| 2024 | 276.79 | 3.35 | 287.00 | 4.90% |
It should be noted that the comparison of Sofina's average annual return against a benchmark index is made on the basis of identical periods.
Since 2016, the Company measures its long-term performance by comparing the evolution of its NAV per share against a benchmark, the MSCI ACWI Net Total Return EUR Index. Sofina's NAVPS is used instead of its share price in order to better reflect management performance and to better align with LTIP concepts.
- • Cash Non-cash: Defines whether a portfolio transaction generated a cash inflow or outflow (Cash) or not (Non-cash).
- • Company: Sofina SA.
- • ESG: Refers to Environmental, Social and Governance factors, as set out in Sofina's Responsible investment policy.
- • Euro Stoxx 50 Net Return Index EUR ("Euro Stoxx 50"): Ticker used by Bloomberg (SX5T Index). This index is also presented because of its wide use in the financial markets.
- • General Partners ("GPs" or "Managers"): Specialised teams managing private equity investment funds, focusing on venture and growth capital funds.
- • Gross cash: Net cash plus financial debts, in transparency.
• Investment Entity: Status adopted by Sofina SA since 1st January 2018 in application of IFRS 10, §27, which provides that, as long as it meets the definition of an Investment Entity, a company does not consolidate its subsidiaries (except for subsidiaries exclusively providing services related to investment activities). Direct subsidiaries are recorded at fair value in the consolidated financial statements, including the fair value of their equity investments and other assets and liabilities (mainly intra-group debts and receivables).
The direct subsidiaries of Sofina SA are stated at fair value through profit and loss in accordance with IFRS 9.
As required by IFRS 10, §B101, Sofina applied this accounting treatment as of 1st January 2018, when it met all the criteria of an Investment Entity, Sofina has determined that it is an Investment Entity within the meaning of IFRS 10 because it meets the three criteria set by the standard. In fact, Sofina:
- uses the funds of its investors (who are shareholders of the listed company) to provide them with investment management services;
- makes investments with the aim of obtaining returns in the form of capital gains and/or investment income;
- monitors the performance of its investments by measuring them at fair value.
In addition, Sofina has all the typical characteristics of an Investment Entity as defined by IFRS 10:
- it has more than one investment;
- it has more than one investor;
- it has investors who are not related parties;
- it has ownership rights in the form of equity securities or similar interests.
As mentioned above, Sofina SA does not consolidate its subsidiaries (IFRS 10, §27).
- • Listed: Level 1 and 2 investments as per the fair value hierarchy defined in point 2.3 of the Notes to the interim condensed consolidated financial statements.
- • Loan-to-value (%): Ratio between (i) Net debt (or if negative, corresponds to Net cash) and (ii) the total value of the portfolio in transparency.
- • LTIP: Long-term incentive plan organised within Sofina.
- • MSCI ACWI Net Total Return EUR Index ("MSCI ACWI"): Ticker used by Bloomberg (NDEEWNR Index). This index is the benchmark used by Sofina. This benchmark is considered to be the most appropriate because of (i) Sofina's global investment strategy (which called for a reference to a World Index ("WI") for developed markets) and (ii) the Sofina group's investments in Asia and the rest of the world (which justified the choice of the All Countries ("AC") index for emerging markets). The Company's essentially European shareholder base and its listing on Euronext Brussels ultimately guided the choice of the euro-denominated index.
- • Net Asset Value ("NAV"): Net assets or shareholder's equity. NAV per share ("NAVPS") corresponds to the net assets per share or equity per share (calculation based on the number of outstanding shares at the end of the period). It should be remembered that since 1st January 2018, Sofina has adopted the status of Investment Entity according to IFRS 10. Since then, its equity, or NAV in the context of this Annual report, corresponds to the fair value of its investments as well as of its direct subsidiaries and their investments and other assets and liabilities.
- • Net cash (or Net debt if negative): Sum, in transparency, of "Cash and cash equivalents", "Deposits" and "Cash investments", less "Financial debts" of current and non-current liabilities. "Receivables from subsidiaries" and "Debts to subsidiaries" are not included in Net cash. The term is used in the key management information (see point 2.1 of the Notes to the interim condensed consolidated financial statements).
• Other assets and liabilities: Sum of "Deferred taxes" (on the assets side), "Other current financial assets", "Receivables from subsidiaries", "Other current debtors" and "Taxes" (on the assets side), less "Non-current provisions", "Non-current financial liabilities", "Deferred taxes" (on the liabilities side), "Payables to subsidiaries", "Current trade and other payables" and "Taxes" (on the liabilities side). These are not shown as separate lines in the internal information used for the management of the Sofina group and have therefore been grouped together to reflect this information (see point 2.1 of the Notes to the interim condensed consolidated financial statements).
- • Portfolio in transparency: Sofina SA manages its portfolio on the basis of the total investments held either directly or through investment subsidiaries. When preparing the financial statements as an Investment Entity, the fair value of its direct investments (in portfolio investments or in investment subsidiaries) is recognised as an asset in the balance sheet. By contrast, segment management information (based on internal reporting) is prepared on the entire portfolio in transparency (i.e. on all portfolio investments whether held by Sofina SA directly, or indirectly through its investment subsidiaries), and thus on the basis of the total fair value of each investment ultimately held. The presentation of dividends or cash follows the same logic.
- • PSU: Performance Share Units offered to beneficiaries under the LTIP.
- • Shareholders' equity: Net Asset Value (as defined herein).
• Sofina Direct: Denomination combining Long-term minority investments and Sofina Growth as a result of some of their similar features, as opposed to Sofina Private Funds.
• Unlisted: Level 3 investments as per the fair value hierarchy defined in point 2.3 of the Notes to the interim condensed consolidated financial statements.
• UNPRI: Principles for Responsible Investment developed by the United Nations (www.unpri.org).
Responsible person
Responsible person
In accordance with Article 12, §2, 3° of the Royal Decree of 14 November 2007, Harold Boël, Chief Executive Officer, certifies in the name and on behalf of the Board of Directors that, to the best of his knowledge:
- the interim condensed consolidated financial statements, prepared in accordance with applicable accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and of the fair value of its investment subsidiaries;
- the interim Management report contains a fair review of the development of the business, the results and the position of the Company and its investment subsidiaries, as well as a description of the principal risks and uncertainties they face.
SOFINA SA
Registered office Rue de l'Industrie, 31 | B-1040 Brussels Tel. : +32 2 551 06 11
[email protected] | www.sofinagroup.com
