Annual Report • Mar 31, 2017
Annual Report
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2016 annual report of the tamburi investment partners group
(translation from the Italian original which remains the definitive version)
| Corporate Boards | 3 |
|---|---|
| Directors' Report | 4 |
| Motion for allocation of the profit for the year of Tamburi Investment Partners S.p.A. | 14 |
| Consolidated Financial Statements | |
| Financial Statements Consolidated income statement Consolidated Statement of Comprehensive Income Consolidated Statement of Financial Position Statement of changes in Consolidated Shareholders' Equity Consolidated Statement of Cash Flows |
15 |
| Explanatory notes to the 2016 consolidated financial statements | 21 |
| Attachments Declaration of the Executive Officer for Financial Reporting List of investments held Changes in AFS financial assets measured at fair value Changes in associates valued under equity method Independent Auditors' Report Fees for audit services |
54 |
| Separate Financial Statements | |
| Financial Statements Income Statement Statement of Comprehensive Income Statement of Financial Position Statement of changes in Shareholders' Equity Statement of Cash Flows |
64 |
| Explanatory notes to the 2016 financial statements | 70 |
| Attachments Declaration of the Executive Officer for Financial Reporting List of investments held 2016 key financial highlights of the subsidiaries Changes in AFS financial assets measured at fair value Changes in investments in associated companies Board of Statutory Auditors' Report Independent Auditors' Report |
92 |
| Emanuele Cottino | Chairman |
|---|---|
| Paola Galbiati | Standing Auditor |
| Andrea Mariani | Standing Auditor |
| Laura Visconti | Alternate Auditor |
| Fabio Pasquini | Alternate Auditor |
PricewaterhouseCoopers S.p.A.
(1) Member of the appointments and remuneration committee
(2) Member of the control and risks and related parties' committee
* In accordance with the Self-Governance Code
The Tamburi Investment Partners Group (hereafter "TIP Group") in 2016 reports a consolidated profit of approximately Euro 86 million - of which Euro 51.5 million attributable to the shareholders of the parent - compared to approximately Euro 25 million in 2015.
It has been a truly exceptional year.
A large part of the income was generated from the withdrawal from Ruffini Partecipazioni with the assignment of Moncler shares to the subsidiary Clubsette S.r.l. ("Clubsette"). This latter was winded up by the end of the year through the assignment of the Moncler shares to shareholders.
The company reported strong results on all fronts with advisory revenues exceeding Euro 12 million compared to approximately Euro 4 million in 2015 and financial income other than the transaction mentioned above of over Euro 34 million.
Consolidated net equity exceeded Euro 437 million, from Euro 449.3 million at December 31, 2015, after the distribution, from profits and reserves, of over Euro 82 million to the minority shareholders of Clubsette, as well as dividends by Tamburi Investment Partners S.p.A. (hereafter "TIP") for approximately Euro 9 million.
The result for the year was influenced by the spin-off of Ferrari from the FCA Group, completed on January 4, 2016, following which TIP received 367,422 Ferrari shares, of which (i) 174,000 shares related to the 1,740,000 FCA shares held at December 31, 2015 and (ii) 193,422 shares from the FCA convertible bond. These transactions, in accordance with IFRS, were recorded for accounting purposes as a dividend distribution and therefore generated a capital gain in the income statement of approximately Euro 16 million. Following this transaction however a loss was recorded in the income statement arising from the difference between the carrying amount at December 31, 2015 of the bonds subscribed within the FCA convertible bond and the market price. This negative difference - initially very significant and which considerably impacted the profitability of TIP in the quarterly and half-yearly results during 2016 - progressively reduced due to the strong increase in the price of FCA shares. At the conversion date into FCA shares, on December 15, 2016, the loss was Euro 8.9 million; in this context it was opportune for TIP to have invested in various instruments related to the Group in order to offset the numerous "peculiarities" imposed by the accounting standards in force; in any case, the overall performance of the FCA Group was - for the TIP Group from an economic and financial standpoint extremely positive.
The recovery in the FCA and Ferrari share prices continued into 2017 and the fair value of these investments is today well above their initial recognition value, including for the FCA shares received from the conversion.
The result for year also benefitted from capital gains on sales - with two public offers launched by industrial partners and therefore permitting TIP the opportunity to monetise "strategic" values of the investments in Bolzoni S.p.A. and Noemalife S.p.A. which generated total gains of Euro 10.3 million. The Noemalife – Dedalus transaction created the largest Pan-European IT Health Group.
Costs were in line with preceding years, except for personnel and executive director fees, which are linked to company performance and therefore significantly increased, given the results achieved; personnel costs include approximately Euro 5.7 million relating to the assignment of 3,500,000 options within the "2014-2021 TIP Incentive Plan".
At December 31, 2016, TIP consolidated net debt – also taking into account the TIP 2014-2020 bond loan – but without including the non-current financial assets, considered by management as liquidity available in the short-term - was approximately Euro 200 million (compared to Euro 177.4 million at December 31, 2015).
Among the most significant events in 2016 we recall the incorporation of Asset Italia S.p.A. ("Asset Italia") in July with the contribution, in addition to TIP, of approximately 30 family offices, for an endowment capital of Euro 550 million. Asset Italia will act as an investment holding and will give shareholders the opportunity to choose for each proposal their individual investments and the receipt of shares for the specific asset class related to the investment subscribed. Asset Italia and TIP will combine within five years.
In relation to this project the TIP Shareholders' Meeting conferred a proxy to the Board of Directors to increase the share capital for a maximum amount of Euro 1,500,000,000 to serve the contribution in kind of Asset Italia shares; the Shareholders' Meeting also approved the elimination of the nominal value of TIP shares.
In the year, TIP significantly increased the investment in Hugo Boss, holding more than 900,000 shares and reducing the average carrying price.
On September 30, 2016, TIP formalised the underwriting of a convertible loan of Euro 15 million issued by Furla S.p.A. that will automatically convert into Furla shares at the time of listing or, alternatively, at September 30, 2019.
Furla announced revenues of over Euro 420 million, of which over 80% abroad with growth at current exchange rates of over 24% and an ever-greater increase in EBITDA; the mono-brand boutiques worldwide reached 444 stores, while the sales points rose to over 1,200.
During 2016 TIP partially reduced the position in Ferrari, not due to a lack of faith in its tremendous potential, but rather, considering the weight of the investments held in the sector, to obtain resources to fund investments more in line with TIP's general profile.
In October TIP finalised a further investment in Talent Garden S.p.A., the largest digital coworking network in Europe, in which Digital Magics holds approximately 18%.
In January, the subsidiary TIP-Pre IPO S.p.A. (hereafter "TIPO"), acquired, together with the company Centokappa S.r.l., full ownership of the Beta Utensili S.p.A. Group, an international leader in the tools sector. For the transaction, TIPO arranged a club deal with 15 co-investors, all Italian family offices.
In June 2016, TIPO and members of the Guzzini family incorporated a company to acquire 17.32% of the share capital of Fimag S.p.A., the holding of the entire Guzzini Group. TIPO's indirect stake in the iGuzzini's group - by far the largest asset within the parent - was significantly increased through this transaction, with the first tranche pay-out entirely funded by the sale on the market of AAA - Advanced Accelerator Applications shares.
AAA`s industrial and stock market performances (at February 28, 2017 +137.1% compared to the IPO price one year ago) continue to be very good.
The most important aspect concerning TIP and TIPO's investees, particularly given the current market environment, is the continued strong performances - in 2016 - of all the principal holdings. Indeed, Amplifon, FCA, Ferrari, Interpump, Moncler and Prysmian - among the companies that have so far published their 2016 figures - report strong earnings, even on the record year of 2015. In relation to the companies which have not yet published their draft financial statements, the results for the nine months were very encouraging.
The TIP share price in the year progressed well, outperforming nearly all the main Italian indices and was up approximately 8% at December 31, 2016 compared to the beginning of the year, while the FTSE MIB lost approximately 10% in the same period.
The usual five-year TIP share chart (at March 13, 2017) highlights the very strong performance of the TIP share, improving 188.8%; the total return for TIP shareholders over the five years was 208.3% (annual average of 41.7%).
The financial results reported below refer, where available, to the 2016 Annual Report already approved by the Board of Directors of the investees by the current date; in the absence of such figures, reference is made to the report for the first nine months of the year or the prior year Annual Report.
TIP holding: 52.50%
In July 2013, TIP incorporated Clubsette S.r.l. ("Clubsette"), which included other investors, principally entrepreneurs and family office, one of which qualified as a related party pursuant to IAS 24; TIP held 52.5% of the share capital of Clubsette.
In July 2016, in accordance with the agreements reached, Clubsette received shares in Moncler previously held by Ruffini Partecipazioni., equal to 5.125% of the share capital.
Clubsette, following the withdrawal from Ruffini Partecipazioni, received the Moncler shares previously held by Ruffini Partecipazioni. This transaction generated for Clubsette - in accordance with IAS/IFRS - a capital gain of Euro 78,008,920, equal to the difference between the book value of the investment in Ruffini Partecipazioni S.r.l. and the payment on withdrawal comprising the Moncler shares received, which in the TIP consolidated financial statements were measured at the price on the day of the transaction, equal to 15,66 Euro.
Clubsette was then placed in liquidation and the Moncler shares assigned to the shareholders. The closure of the liquidation was on December 29, 2016. TIP however remains a direct shareholder of Moncler with a holding of 2.32%.
In 2016, the Moncler group reported consolidated revenues of Euro 1,040.3 million, an adjusted Ebitda of Euro 355.1 million and a net profit of Euro 196.0 million. The growth in revenues and earnings was therefore again confirmed in 2016, positioning Moncler at the top end of the most prestigious global brands, by margins.
TIP holding at December 31, 2016: 51.00%
TXR, a 51.0% subsidiary, with the residual share held by other co-investors (including a trust company) not qualifying as related parties pursuant to IAS 24, in accordance with the club deals promoted by TIP was incorporated for the purpose of acquiring a shareholding in Furn-Invest S.a.S., a company which now controls 99.9% of the Roche Bobois group.
Roche Bobois is the world leader in the creation and distribution of select high quality, design and luxury furniture products. The group operates the largest chain worldwide of high-end design furniture products, with a network – direct and/or franchising – comprising approximately 300 sales points (of which 100 owned) located in prestigious commercial areas, with a presence in the most important cities worldwide, including Europe, North, Central and South America, Africa, Asia and the Middle East.
In 2016, the Roche Bobois group grew further and the preliminary results indicate aggregate revenues (including franchising stores) of approximately Euro 545 million, while consolidated revenues - which only refer to direct sales - totalled approximately Euro 255 million and consolidated Ebitda of approximately Euro 27 million; the Group has a net cash position.
TIP holding at December 31, 2016: 23.41% Listed on the Italian Stock Exchange - STAR Segment.
The BE group is one of the leading Italian management consultancy operators for the banking and insurance sectors and for IT and back office services.
In the first nine months of 2016, the BE Group reported consolidated revenues of Euro 97.1 million, +24.3% on the same period of 2015, an EBITDA of Euro 11.1 million, compared to Euro 9.4 million in the same period of the previous year, and a pre-tax profit of Euro 5.6 million (+44.4%).
TIP holding at December 31, 2016: 27.50%, 37.29% fully diluted
Clubitaly was incorporated in 2014, together with some entrepreneurial families and family office, two of which qualify as related parties pursuant to IAS 24, and acquired from Eatinvest S.r.l., a company controlled by the Farinetti family, 20% of Eataly S.r.l. ("Eataly"). Clubitaly S.p.A. currently holds 19.74% of Eataly.
Eataly, founded in 2003 by Oscar Farinetti, operates with a global reach in the distribution and marketing of Italian high-end gastronomic products integrating production, sales, catering and healthy living. The company represents a peculiar phenomenon - being the only Italian company in the food retail sector with a truly international vocation, as well as a symbol of Italian food and of high quality Made in Italy products worldwide.
Eataly currently operate in Italy, America, the Middle and Far East with a network of approximately 30 stores operational and is implementing a significant store opening programme in some of the world's major cities through direct sales points and franchises. In 2016, the second store was opened in New York, in front of Ground Zero and was followed by important openings in Boston and Copenhagen. In January 2017, an impressive store was opened in Trieste. In 2017/2018 openings are planned in London, Los Angeles, Moscow, Paris, Stockholm,
The preliminary results for the year 2016 report Group revenues of just under Euro 400 million, with profitability heavily impacted by one-off costs and major delays in some openings.
TIP holding at December 31, 2016: 35%, 43.28% fully diluted
Clubtre S.p.A. is currently the largest shareholder in Prysmian S.p.A. ("Prysmian"), even after the sale of shares through an accelerated book building in January 2017.
Prysmian is the world leader in the production of energy and telecommunication cables with 88 factories, 17 R&D centres and approximately 19,000 employees worldwide.
In 2016, Prysmian reported consolidated revenues of approximately Euro 7.6 billion, an adjusted Ebitda of approximately Euro 711 million, up 14%, and a net profit of approximately Euro 246 million.
TIP holding at December 31, 2016: 23.64%, 33.72% fully diluted
Gruppo IPG Holding S.p.A. ("IPGH") currently holds 23,406,799 shares (equal to 21.5% of the share capital) of Interpump Group S.p.A., world leader in the production of high pressure pistons pumps, power take-offs (PTOs), distributors and hydraulic systems.
In 2016, Interpump Group reported consolidated revenues of Euro 922.8 million, up 3.1%, an Ebitda of Euro 198.5 million, compared to Euro 180.3 million in 2015 and a net profit of Euro 94.5 million.
TIP holding at December 31, 2016: 28.57%
TIPO undertakes minority investments in Italian or overseas companies in the industrial or services sectors, with revenues of between Euro 30 and 200 million, listed on a stock exchange or with a view to listing on a regulated equity market.
TIPO may also subscribe convertible bonds, cum warrants or other "semi-equity" similar instruments, as well as share capital increases – including companies already listed on the stock exchange – provided that the transactions are to be considered as part of expansion projects, investments and/or growth of the respective activities.
At December 31, 2016, TIPO held the following shareholdings:
The company, in which TIPO holds a small investment, has been listed on the Nasdaq Global Select Market since November 2015 and is one of the major molecular and nuclear medicine players, founded in 2002 by Italian academics as a "spin-off" of CERN (European Organisation for Nuclear Research) to develop diagnostic applications and products and innovative therapeutics.
In the first nine months of 2016, AAA generated consolidated revenues of Euro 81.3 million, strong growth on Euro 66.1 million in the same period of the previous year.
Beta Utensili S.r.l., indirectly held 49.917% by Betaclub S.r.l., in turn controlled by TIPO with a 58.417% holding, is the leader in Italy in the distribution and production of high quality professional utensils, with over 500 employees. Exports account for over 50% of turnover.
The preliminary results for 2016 report further growth by the Group with net revenues of approximately Euro 130 million and an EBITDA of approximately Euro 25 million.
TIPO holds 14.29% (15.85% on a fully diluted basis) of iGuzzini Illuminazione S.p.A., the Italian leader - and among the leaders in Europe - in the design and production of high quality internal and external architectural lighting systems. The sectors of application include the lighting of historic buildings, retail spaces, offices, residential buildings, hotels, streets and urban areas. The group has 15 international branches and production facilities in Italy and China. In June 2016, TIPO, together with some members of the Guzzini family, incorporated GH S.r.l. with the purpose of acquiring some investments in Fimag S.p.A., a company which in addition to holding over 75% (84.15% on a fully diluted basis) in iGuzzini Illuminazione S.p.A. has investments in other industrial, property and financial companies.
The total investment by TIPO (which holds 47.83% of GH S.r.l.) in this second Group transaction is so far approximately Euro 5.5 million.
The preliminary results for 2016 report further growth by the Group with revenues of approximately Euro 232 million and an EBITDA of approximately Euro 29 million.
TIP in addition holds:
TIP holding at December 31, 2016: 4.24% Listed on the Italian Stock Exchange - STAR Segment.
The Amplifon Group is world leader in the distribution and personalised application of hearing aids with almost 4,000 direct sales points, 3,700 service centres and 1,900 affiliated stores.
In 2016, the Amplifon group reported consolidated revenues of Euro 1,133 million (up 10%), an Ebitda of Euro 190 million (up 13%) and a net profit of over Euro 70 million.
TIP holding at December 31, 2016: 18.11% Listed on the Alternative Investment Market (AIM) Italia
Digital Magics S.p.A. is the leading Italian incubator for innovative digital start-ups. It has incubated over 80 start-ups to date, with 74 still in portfolio. The "incubated" start-ups have created more than 500 jobs.
It launched and is progressively developing, through aggregations, the largest innovative hub in partnership with Talent Garden - the largest European co-working centre - WebWorking (company founded by Marco Gay), WithFounders, Innogest, Università Telematica Pegaso and Universitas Mercatorum.
The start-ups incubated by Digital Magics in 2015 generated revenues of Euro 32.5 million, compared to Euro 18.7 million in 2014 - up 73%.
TIP holding at December 31, 2016: 0.16% of the ordinary share capital Listed on the Italian Stock Exchange and the New York Stock Exchange
Ferrari N.V. manufactures and distributes high-end sports cars and racing cars. The company possess technologies and intangibles difficult to replicate, ensuring the company's place as a meeting point of innovation, design, exclusivity and technology.
In 2016, Ferrari reported revenues of Euro 3.105 billion, up 8.8% on 2015, an adjusted EBITDA of Euro 880 million, up 18% on the previous year and a net profit of Euro 400 million, up 38%.
TIP shareholding at December 31, 2016: 0.22% of the ordinary share capital Listed on the Italian Stock Exchange and the New York Stock Exchange
The Fiat Chrysler Automobiles NV (FCA) group is the seventh largest car manufacturer in the world with the brands Abarth, Alfa Romeo, Chrysler, Dodge, Ferrari, Fiat, Fiat Professional, Jeep, Lancia, Maserati and Ram, in addition to SRT, the sports division dedicated to high performance vehicles and Mopar, the post-sales service and spare parts brand. Group operations include also Comau (production systems), Magneti Marelli (components) and Teksid (foundries).
In 2016, the FCA group reported record results with consolidated revenues of Euro 111.018 billion, an adjusted EBIT of Euro 6.056 billion, up 26%, and an adjusted net profit of Euro 2.516 billion, up 47% on 2015.
TIP holding at December 31, 2016: 1.28% Listed on the Frankfurt Stock Exchange
Hugo Boss AG is a market leader in the premium and luxury segment of the medium-high and high-end apparel market for men and women, with a diversified range from fashionable clothing to footwear and accessories.
Hugo Boss products are distributed in over 1,000 shops worldwide.
In 2016, the Hugo Boss Group reported consolidated revenues of Euro 725.2 million, an adjusted EBITDA of approximately Euro 493 million and a net profit of approximately Euro 63.5 million.
TIP holding at December 31, 2016: 12.07%
Azimut Benetti S.p.A. is one of the most prestigious constructors of mega yachts worldwide. The company has been ranked 16 times in the last 18 years as the "Global Order Book" leader, which ranks the major global constructors of yachts and mega yachts of over 24 metres worldwide.
It has 11 boatyards and a sales network in over 70 countries.
In the year to August 31, 2016, the company reports a small but significant increase in the value of production to approximately Euro 700 million and a strong increase in EBITDA compared to 2015.
TIP subscribed a bond of approximately Euro 8 million in one of the holdings with an investment in Octo Telematics, the principal global provider of telematic services for the insurance and automotive market.
On the sale of shares in Noemalife, TIP reinvested over Euro 9 million in a vendor loan in Dedalus Holding, at an interest rate of 9% with maturity on December 31, 2018.
TIP also has a direct holding of 2.77% in Talent Garden, the leading European co-working operator, already an investee with a stake of 18.72% by Digital Magics.
In addition to the investments listed, TIP holds stakes in other listed and non-listed companies which in terms of amounts invested are not considered significant; for details reference should be made to Attachment 2.
The transactions with related parties are detailed in note 33.
In January 2017, Clubtre, held 43.28% by TIP on a fully diluted basis, sold 4 million shares in Prysmian, corresponding to 1.85% of the share capital, for a total value of Euro 97.6 million, before commissions. Following this sale, Clubtre remains the largest shareholder of Prysmian, with over 4% of the share capital.
The transaction represented a partial realisation of the significant investment made in 2010.
Taking also into account the additional 2,076,925 FCA shares received by TIP in the conversion in December 2016 of the FCA 7.875% convertible bond, in the initial months of 2017, TIP also partially reduced - for approximately 25% of the overall position held in the Group - the position in FCA shares, due to the significant increase in the share price.
In February 2017, the investee Digital Magics launched a share capital increase with the issue of 1,232,459 ordinary shares for a total maximum value of approximately Euro 5 million. TIP (already the largest shareholder with a stake of approximately 18%), subscribed the option rights for approximately Euro 900 thousand and exercised the pre-emption right on 76,883 unopted shares for a further Euro 310 thousand.
In a truly challenging market, the TIP Group continues to perform strongly, generating further growth and continuing to invest and launch new initiatives which will ensure its continued role – through employing a unique business model in Italy - as an entrepreneurial partner and financial backer for outstanding companies willing to grow and/or resolve governance issues, always with a view to business development.
The key to the TIP Group model is to continue to invest in solid, well managed companies with distinctive technologies and/or brands which enable them to be market leaders.
The results reported in 2016 confirm that all the main TIP Group investees have such characteristics and in our view are excellently positioned to meet future challenges, while considering the accelerated pace of development and growing competitiveness of recent years.
The record results achieved by the TIP Group in 2016 are clearly closely linked to the partial or
total realisation of significant investments which – in order to be repeated – depend on market performances and the buying and selling opportunities which will present in the coming year.
During the year, the Company did not carry out any research and development activity.
In relation to the principal Group risks and uncertainties, reference should be made to note 30.
The treasury shares in portfolio at December 31, 2016 totalled 1,478,370, equal to 1.00% of the share capital. At the present date, treasury shares in portfolio total 1,459,498, equal to 0.987% of the share capital.
Dear Shareholders,
We invite you to approve the 2016 statutory financial statements of Tamburi Investment Partners S.p.A., as presented, and we propose the allocation of the net profit of Euro 41,072,198, as follows:
| - | to the legal reserve | Euro 404 |
|---|---|---|
| - | to ordinary shares, a gross dividend of Euro 0.069 | |
| per share for a total of (*) | Euro 10,097,459 | |
| - | to retained earnings |
Euro 30,974,335 |
(*) Net of the 1,459,498 treasury shares held by the Company or any other shares held by the Company at the dividend coupon date, recording the amount necessary in the share premium reserve.
For the Board of Directors The Chairman Giovanni Tamburi
Milan, March 14, 2017
| (in Euro) | 2016 | 2015 | Note |
|---|---|---|---|
| Revenue from sales and services | 12,206,785 | 3,977,113 | 4 |
| Other revenue | 206,141 | 152,399 | |
| Total revenue | 12,412,926 | 4,129,512 | |
| Purchases, service and other costs | (2,177,839) | (2,197,392) | 5 |
| Personnel expenses | (24,676,991) | (6,781,822) | 6 |
| Amortisation, depreciation & write-downs | (59,579) | (44,658) | |
| Operating Profit | (14,501,483) | (4,894,360) | |
| Financial income | 112,033,771 | 33,352,638 | 7 |
| Financial charges | (19,874,805) | (9,737,643) | 7 |
| Profit before adjustments to investments | 77,657,483 | 18,720,635 | |
| Share of profit/(loss) of investments under equity | 10,609,277 | 8,360,999 | 8 |
| Adjustments to available-for-sale financial assets | (2,140,137) | (288,653) | 9 |
| Profit before taxes | 86,126,623 | 26,792,981 | |
| Current and deferred taxes | (493,253) | (1,797,729) | 10 |
| Profit | 85,633,370 | 24,995,252 | |
| Profit attributable to the shareholders of the parent |
51,486,389 | 25,233,887 | |
| Profit/(loss) attributable to minority interests | 34,146,981 | (238,635) | |
| Basic (diluted) earnings per share of the parent | 0.35 | 0.17 | 24 |
| Basic (diluted) earnings per share of the parent | 0.34 | 0.14 | |
| Number of shares in circulation | 146,321,117 | 147,253,924 |
| (in Euro) | 2016 | 2015 | Note |
|---|---|---|---|
| Income and charges recorded directly to equity | |||
| Income through P&L | 24 | ||
| Increase/(decrease) in non-current AFS financial assets | (41,509,030) | 24,780,763 | |
| Unrealised profit/(loss) | (40,643,267) | 24,621,736 | |
| Tax effect | (865,763) | 159,027 | |
| Increase/(decrease) in investees measured under the equity | |||
| method | 32,337,001 | 21,706,237 | |
| Unrealised profit/(loss) | 32,337,001 | 21,706,237 | |
| Tax effect | - | - | |
| Increase/decrease) AFS current financial assets | (183,238) | (606,932) | |
| Unrealised profit/(loss) | (281,338) | (808,551) | |
| Tax effect | 98,100 | 201,619 | |
| Income/(loss) not through P&L | |||
| Employee benefits | (20,087) | 7,811 | |
| Other changes | - | - | |
| Total income and charges recorded directly to equity | (9,375,354) | 45,887,879 | |
| Profit | 85,633,370 | 24,995,252 | |
| Total income and charges recorded | 76,258,016 | 70,883,131 | |
| Total income and charges attributable to the shareholders of the parent |
62,229,306 | 59,938,564 | |
| Total income and charges attributable to minority interests | 14,028,710 | 10,944,567 |
| December 31, | |||
|---|---|---|---|
| (in Euro) | December 31, 2016 | 2015 | Note |
| Non-current assets | |||
| Property, plant and equipment | 170,589 | 114,094 | 11 |
| Goodwill | 9,806,574 | 9,806,574 | 12 |
| Other intangible assets | 4,626 | 1,310 | 12 |
| Associated measured under the equity method | 235,559,227 | 185,498,596 | 13 |
| AFS financial assets | 374,267,042 | 429,418,286 | 14 |
| Financial receivables | 33,751,593 | 8,218,972 | 15 |
| Tax receivables | 136,116 | 293,787 | 16 |
| Deferred tax assets | 2,143,389 | 824,940 | 17 |
| Total non-current assets | 655,839,156 | 634,176,559 | |
| Current assets | |||
| Trade receivables | 957,977 | 2,581,564 | 18 |
| Current financial receivables | 483,136 | 0 | 15 |
| Current financial assets | 182,701 | 26,946,127 | 19 |
| AFS financial assets | 0 | 21,613,809 | 20 |
| Cash and cash equivalents | 1,286,769 | 2,011,105 | 21 |
| Tax receivables | 336,373 | 442,172 | 16 |
| Other current assets | 272,800 | 728,564 | |
| Total current assets | 3,519,756 | 54,323,341 | |
| Total Assets | 659,358,912 | 688,499,900 | |
| Equity | |||
| Share capital | 76,855,733 | 76,853,713 | 22 |
| Reserves | 234,969,155 | 221,052,483 | 23 |
| Retained earnings | 56,977,958 | 41,139,559 | |
| Result of the parent | 51,486,389 | 25,233,887 | 24 |
| Total equity attributable to the shareholders of the | |||
| parent | 420,289,235 | 364,279,642 | |
| Equity attributable to minority interests | 16,787,469 | 85,062,843 | |
| Total equity | 437,076,704 | 449,342,485 | |
| Non-current liabilities | |||
| Post-employment benefits | 271,667 | 226,451 | 25 |
| Financial payables | 133,752,298 | 138,594,609 | 26 |
| Deferred tax liabilities | 3,078,424 | 2,239,997 | 17 |
| Total non-current liabilities | 137,102,389 | 141,061,057 | |
| Current liabilities | |||
| Trade payables | 550,303 | 349,324 | |
| Current financial liabilities | 67,380,277 | 89,417,843 | 27 |
| Tax payables | 429,039 | 1,792,375 | 28 |
| Other liabilities | 16,820,200 | 6,536,816 | 29 |
| Total current liabilities | 85,179,819 | 98,096,358 | |
| Total liabilities | 222,282,208 | 239,157,415 | |
| Total equity and liabilities | 659,358,912 | 688,499,900 | |
in Euro
| Share | Share capital premium reserve |
reserve | Legal Extraordinary reserve |
Revaluation reserve AFS Financial assets |
Treasury shares reserve |
Other reserves |
business combination |
IFRS Merger reserve surplus |
Retained | Result earnings for the period shareholders of parent |
shareholders of parent |
Net Equity Net Equity | Result minorities for the period minorities |
Net Equity | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| At January 1, 2015 consolidated | 74,609,847 95,114,530 | 14,148,939 | 0 | 50,813,900 (13,606,493) | 4,347,294 | (483,655) 5,060,152 | 23,422,765 | 26,798,061 | 280,225,340 | 72,379,694 | 1,738,581 | 354,343,616 | |||
| Change in fair value of financial assets | |||||||||||||||
| available-for-sale | 13,597,560 | 13,597,560 | 11,183,203 | 24,780,763 | |||||||||||
| Change in fair value of investments measured at equity | 27,014,534 | (5,308,297) | 21,706,237 | 21,706,237 | |||||||||||
| Change in fair value of current financial assets | (606,932) | (606,932) | (606,932) | ||||||||||||
| Employee benefits | 7,811 | 7,811 | 7,811 | ||||||||||||
| Other changes | 0 | 0 | |||||||||||||
| Total income and charges recorded directly to equity | 40,005,162 | (5,300,486) | 34,704,676 | 11,183,203 | 45,887,879 | ||||||||||
| Profit (loss) 2015 | 25,233,887 | 25,233,887 | (238,635) | 24,995,252 | |||||||||||
| Total statement of comprehensive income | 40,005,162 | 25,233,887 | 59,938,563 | (238,635) | 70,883,131 | ||||||||||
| Transfer to equity revaluation reserve | 0 | 0 | |||||||||||||
| Allocation profit 2014 | 773,030 | 17,716,794 | (18,489,824) | 0 | 1,738,581 (1,738,581) | 0 | |||||||||
| Distribution of dividends | 0 | 0 | |||||||||||||
| Other changes | (8,308,237) | (8,308,237) | (8,308,237) | ||||||||||||
| Warrant conversion | 2,243,866 | 6,386,388 | 8,630,254 | 8,630,254 | |||||||||||
| Acquisition of treasury shares | (5,905,291) | (5,905,291) | (5,905,291) | ||||||||||||
| Sale of treasury shares | 12,030,610 | 17,668,403 | 29,699,013 | 29,699,013 | |||||||||||
| At December 31, 2015 consolidated | 76,853,713 113,531,528 | 14,921,969 | 0 | 90,819,062 (1,843,381) | (953,192) | (483,655) 5,060,152 | 41,139,559 | 25,233,887 | 364,279,642 | 85,301,478 (238,635) | 449,342,485 | ||||
| At January 1, 2016 consolidated | 76,853,713 113,531,528 | 14,921,969 | 0 | 90,819,062 (1,843,381) | (953,192) | (483,655) 5,060,152 | 41,139,559 | 25,233,887 | 364,279,642 | 85,301,478 (238,635) | 449,342,485 | ||||
| Change in fair value of financial assets available-for-sale |
(21,390,759) | (21,390,759) | (20,118,271) | (41,509,030) |
| Change in fair value of financial assets | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| available-for-sale | (21,390,759) | (21,390,759) | (20,118,271) | (41,509,030) | |||||||||
| Change in fair value of investments measured at equity | 26,933,361 | 5,403,640 | 32,337,001 | 32,337,001 | |||||||||
| Change in fair value of current financial assets | (183,238) | (183,238) | (183,238) | ||||||||||
| Employee benefits | (20,087) | (20,087) | (20,087) | ||||||||||
| Other changes | 0 | 0 | |||||||||||
| Total income and charges recorded directly to equity | 5,359,364 | 5,383,553 | 10,742,917 | (20,118,271) | (9,375,354) | ||||||||
| Profit (loss) 2016 | 51,486,389 | 51,486,389 | 34,146,981 | 85,633,370 | |||||||||
| Total statement of comprehensive income | 5,359,364 | 51,486,389 | 62,229,306 | (20,118,271) 34,146,981 | 76,258,016 | ||||||||
| Transfer to equity revaluation reserve | 0 | 0 | |||||||||||
| Allocation profit 2015 | 448,774 | 15,838,399 | (16,287,173) | 0 | (238,635) | 238,635 | 0 | ||||||
| Other changes | 0 | (82,010,084) | (82,010,084) | ||||||||||
| Distribution of dividends | (8,946,714) | (8,946,714) | (294,000) | (9,240,714) | |||||||||
| Stock option plan effect | 5,722,750 | 5,722,750 | 5,722,750 | ||||||||||
| Conversione warrant | 2,020 12,704 |
14,724 | 14,724 | ||||||||||
| Warrant conversion | (3,010,473) | (3,010,473) | (3,010,473) | ||||||||||
| Acquisition of treasury shares | 0 | 0 | |||||||||||
| At December 31, 2016 consolidated | 76,855,733 113,544,232 | 15,370,743 | 0 | 96,178,426 (4,853,854) | 10,153,111 | (483,655) 5,060,152 | 56,977,958 | 51,486,389 | 420,289,235 | (17,359,512) 34,146,981 | 437,076,704 |
| euro thousands | December 31, 2016 | December 31, 2015 | |
|---|---|---|---|
| A.- | OPENING NET CASH AND CASH EQUIVALENTS | (55,739) | (18,475) |
| B.- | CASH FLOW FROM OPERATING ACTIVITIES | ||
| Profit | |||
| Amortisation & Depreciation | 85,633 | 24,995 | |
| Write-downs/(revaluation) of investments | 54 | 31 | |
| Write-downs/(revaluation) of current financial assets (doubtful debts) |
(8,469) 5 |
(8,072) 13 |
|
| Financial income and charges | (93,476) | (18,776) | |
| Changes in "employee benefits" | 46 | 15 | |
| Stock option charges | 5,722 | 0 | |
| Charges on bonds | 6,763 | 3,334 | |
| Change in deferred tax assets and liabilities | |||
| (1,847) (5,569) |
(40) 1,500 |
||
| Decrease/(increase) in trade receivables | 1,624 | (2,057) | |
| Decrease/(increases) in other current assets | 456 | (350) | |
| Decrease/(increase) in tax receivables | 264 | (374) | |
| Decrease/(increase) in financial receivables | (9,540) | (4,345) | |
| Decrease/(increase) in other current asset securities | 21,614 | 60,476 | |
| (Decrease)/increase in trade payables | 201 | (75) | |
| (Decrease)/increase in financial payables | (12,475) | 3,652 | |
| (Decrease)/increase of tax payables | (1,363) | 1,334 | |
| (Decrease)/increase in other current liabilities | 10,283 | (2,373) | |
| Cash flow from operating activities | 5,495 | 57,388 | |
| C.- | CASH FLOW FROM | ||
| INVESTMENTS IN FIXED ASSETS | |||
| Intangible and tangible assets | |||
| Investments / divestments | (108) | (76) | |
| Financial assets | |||
| Investments | (242,440) | (164,883) | |
| Disposals | 270,016 | 49,962 | |
| Cash flow from investing activities | 27,468 | (114,997) |
| euro thousand |
|---|
euro thousands December 31, 2016 December 31, 2015
| Loans | ||
|---|---|---|
| New loans | 39,830 | 0 |
| Repayment of loans | (39,944) | 0 |
| Borrowing costs on loans | (6,408) | (3,334) |
| Share capital | ||
| Share capital increase and capital contributions on account | 14 | 38,329 |
| Reduction for treasury share purchases | (3,007) | (5,905) |
| Payment of dividends | (9,241) | (8,308) |
| Change in reserves | (417) | (436) |
| Cash flow from financing activities | (19,173) | 20,346 |
| E.- NET CASH FLOW FOR THE YEAR F. CLOSING CASH AND CASH EQUIVALENTS |
13. 790 (41,949) |
(37,263) (55,739) |
| The breakdown of the net available liquidity was as follows: | ||
| Cash and cash equivalents | 1,287 | 2,011 |
| Bank payables due within one year | (43,236) | (57,750) |
| Closing cash and cash equivalents | (41,949) | (55,739) |
The TIP Group is an independent investment/merchant bank focused on Italian medium-sized companies, with a particular involvement in:
The parent company TIP was incorporated in Italy as a limited liability company and with registered office in Italy.
The company was listed in November 2005 and on December 20, 2010 Borsa Italiana S.p.A. assigned the STAR classification to TIP S.p.A. ordinary shares.
These consolidated financial statements at December 31, 2016 were approved by the Board of Directors on March 14, 2017, and authorised their publication.
The consolidated financial statements at December 31, 2016 were prepared in accordance with the going-concern concept and in accordance with International Financial Reporting Standards and International Accounting Standards (hereafter "IFRS", "IAS" or international accounting standards) issued by the International Accounting Standards Boards (IASB) and the relative interpretations of the International Financial Reporting Interpretations Committee (IFRIC), and adopted by the European Commission with Regulation No. 1725/2003 and subsequent modifications, in accordance with Regulation No. 1606/2002 of the European Parliament.
The consolidated financial statements in accordance with IAS1 are comprised of the income statement, the statement of comprehensive income, the statement of financial position, the change in shareholders' equity, the statement of cash flow and the explanatory notes, together with the Directors' Report. The financial statements were prepared in units of Euro, without decimal amounts.
The accounting policies and methods utilised for the preparation of these consolidated financial statements have not changed from those utilised for the preparation of the consolidated financial statements for the year ended December 31, 2015, except as outlined in the paragraph "new accounting standards".
The income statement and the consolidated statement of comprehensive income for the period to December 31, 2015 and the consolidated statement of financial position and the consolidated statement of cash flow at December 31, 2015 were utilised for comparative purposes.
During the year, no special circumstances arose requiring recourse to the exceptions allowed under IAS 1.
The consolidated financial statements at December 31, 2016 were prepared in accordance with the general cost criterion, with the exception of derivative financial instruments measured at fair value, of the investments in associates valued under the equity method and of the current financial assets and financial assets available for sale measured at fair value.
The preparation of the consolidated financial statements requires the formulation of valuations, estimates and assumptions which impact the application of the accounting principles and the amounts of the assets, liabilities, costs and revenues recorded in the financial statements. These estimates and relative assumptions are based on historical experience and other factors considered reasonable. However, it should be noted as these refer to estimates, the results obtained will not necessarily be the same as those represented. The estimates are used to value the provisions for risks on receivables, measurement at fair value of financial instruments, impairment tests, employee benefits and income taxes.
The accounting principles utilised in the preparation of the financial statements and the composition and changes in the individual accounts are illustrated below.
Amendments to IAS 19 - Employee Benefits (Defined Benefit Plans - Employee contributions) On December 17, 2014, EU Regulation 29-2015 was issued and enacted at EU level some improvements to IAS 19 (Employee Benefits). In particular, these amendments have the objective to clarify the accounting treatment of contributions paid by employees within a defined benefit plan.
Improvements to IFRS (2010–2012 cycle)
On December 17, 2014 EU Regulation 28-2015 was issued which enacted at EU level some improvements to IFRS for the period 2010–2012. In particular, we highlight:
which financial indicators were utilised in determining whether the operating segments have similar financial characteristics;
financial statements and the part of the interim financial report in which it is included (for example the Directors' Report or the comment upon risk's report).
Amendments to IFRS 10 (Consolidated Financial Statements), IFRS 12 (Disclosure on investments in other entities) and IAS 28 (Investments in associates and joint ventures); the amendments provide clarifications on the application of the exception to consolidation for "investment entities".
The application of the new accounting standards and the amendments to the existing accounting standards reported above do not have a significant impact on the Group consolidated financial statements.
The standard specifies, in addition, that the sales prices should be adjusted where containing a significant financial component. IFRS 15 will be applicable from the first quarter of financial years beginning January 1, 2018.
Clarifications to IFRS 15: the IASB issued a document containing a number of clarifications on the application of IFRS 15 and simplifications for the adoption phase of the new standard. The application date will be the same as IFRS 15, to which it refers.
Amendments to IFRS 2: the amendments provide clarifications with regard to the classification and measurement of share-based payment transactions. They should be adopted from January 1, 2018, except for any deferments following endorsement of the standard by the European Union, not yet implemented at the date of these consolidated financial statements.
In December 2016, the IAS published a series of annual amendments to IFRS 2014–2016. The amendments concern:
IFRS 12 - Disclosure of interests in other entities (applicable from January 1, 2017, except for any deferments following endorsement of the standard by the European Union, not yet implemented at the date of these consolidated financial statements);
IFRS 1 - First-time Adoption of International Financial Reporting Standards (application from January 1, 2018, except for any deferments following endorsement of the standard by the European Union, not yet implemented at the date of these consolidated financial statements);
IAS 28 - Investments in associated companies and joint ventures (applicable from January 1, 2018), except for any deferments following endorsement of the standard by the European Union, not yet implemented at the date of these consolidated financial statements.
The amendments clarify, correct, or renew the redundant text in the related IFRS standards.
In December 2016, the IAS issued amendments to the interpretation IFRIC 22 relating to the considerations on transactions and advances in foreign currencies. The amendment concerns the exchange rate to be utilised in transactions and advances paid or received in foreign currencies. The amendment will be applicable from January 1, 2018, except for any deferments following endorsement of the standard by the European Union, not yet
implemented at the date of these consolidated financial statements.
The impacts of these amendments on the Group consolidated financial statements are currently being assessed.
The consolidation scope includes the parent TIP - Tamburi Investment Partners S.p.A. and the companies in which it exercises direct or indirect control. An investor controls an entity in which an investment has been made when exposed to variable income streams or when possessing rights to such income streams based on the relationship with the entity, and at the same time has the capacity to affect such income steams through the exercise of its power. Subsidiaries are consolidated from the date control is effectively transferred to the Group, and cease to be consolidated from the date control is transferred outside the Group.
At December 31, 2016, the consolidation scope included the companies TXR S.r.l. and Clubsette S.r.l..
The details of the subsidiaries were as follows:
| Company | Registered office | Share capital | Holding |
|---|---|---|---|
| Clubuno S.r.l. | Milan | 10,000 | 100% |
| TXR S.r.l. | Milan | 100,000 | 51.00% |
The consolidation scope compared to the previous year excludes the subsidiary Clubsette S.r.l., as after the withdrawal of the investment in Ruffini Partecipazioni - following which it received the Moncler S.p.A. shares - the company was placed in liquidation. The liquidation process, which saw the assignment of the assets to the shareholders, including in particular the Moncler shares, was concluded on December 29, 2016.
The consolidation of the subsidiaries is made on the basis of the respective financial statements of the subsidiaries, adjusted where necessary to ensure uniform accounting policies adopted by the Parent Company.
All inter-company balances and transactions, including any unrealised gains deriving from transactions between Group companies are fully eliminated. Unrealised losses are eliminated except when they represent a permanent impairment in value.
The most significant accounting policies adopted in the preparation of the consolidated financial
statements at December 31, 2016 are disclosed below.
Property, plant & equipment are recognised at historical cost, including directly allocated accessory costs and those necessary for bringing the asset to the condition for which it was acquired. If major components of such tangible assets have different useful lives, such components are accounted for separately.
Tangible assets are presented net of accumulated depreciation and any losses in value, calculated as described below.
Depreciation is calculated on a straight-line basis according to the estimated useful life of the asset; useful life is reviewed annually. Any changes, where necessary, are recorded in accordance with future estimates; the main depreciation rates used are the following: following:
| - | furniture & fittings | 12% |
|---|---|---|
| - | equipment & plant | 15% |
| - | EDP | 20% |
| - | mobile telephones | 20% |
| - | equipment | 15% |
| - | automobiles | 25% |
The book value of tangible assets is tested to ascertain possible losses in value if events or circumstances indicate that the book value cannot be recovered. If there is an indication of this type and in the case where the carrying value exceeds the realisable value, the assets must be written down to their realisable value. The realisable value of the property, plant and equipment is the higher between the net sales price and the value in use. In defining the value of use, the expected future cash flows are discounted using a pre-tax discount rate that reflects the current market assessment of the time value of money and the specific risks of the activity. Losses in value are charged to the income statement under amortisation, depreciation and write-down costs. Such losses are restated when the reasons for their write-down no longer exist.
At the moment of the sale, or when there are no expected future economic benefits from the use of an asset, this is eliminated from the financial statements and any loss or gain (calculated as the difference between the disposal value and the book value) is recorded in the income statement in the year of the above-mentioned elimination.
Business combinations are recorded using the purchase method. Goodwill represents the surplus of acquisition cost compared to the purchaser's share of the identifiable net fair value of the assets and liabilities acquired, current and potential. After initial recognition, goodwill is reduced by any accumulated losses in value, calculated with the methods described below.
Goodwill deriving from acquisitions prior to January 1, 2004 are recorded at replacement cost, equal to the value recorded in the last financial statements prepared in accordance with the
previous accounting standards (December 31, 2003). In the preparation of the opening financial statements in accordance with international accounting standards the acquisitions before January 1, 2004 were not reconsidered.
Goodwill is subject to a recoverability analysis conducted annually or at shorter intervals in case of events or changes that could result in possible losses in value. Any goodwill emerging at the acquisition date is allocated to each cash-generating unit which is expected to benefit from the synergies of the acquisition. Any loss in value is identified by means of valuations based on the ability of each cash-generating unit to produce cash flows for purposes of recovering the part of goodwill allocated to it; these valuations are conducted with the methods described in the section referring to tangible assets. If the recoverable value of the cash-generating unit is less than the attributed book value, the loss in value is recorded.
This loss is not restated if the reasons for the loss no longer exist.
Other intangible assets are recorded at cost, in accordance with the procedures indicated for tangible fixed assets.
The intangible assets with definite useful lives are recognised net of the relative accumulated amortisation and any permanent impairment in value, determined in the same manner as that for tangible assets.
The useful life is reviewed on an annual basis and any changes, where necessary, are made in accordance with future estimates.
The gains and losses deriving from the disposal of intangible assets are determined as the difference between the value of disposal and the carrying value of the asset and are recorded in the income statement at the moment of the disposal.
Associated companies are companies in which the Group exercises a significant influence on the financial and operating policies, although not having control. Significant influence is presumed when between 20% and 50% of voting rights is held in another entity.
Investments in associated companies are measured under the equity method and initially recorded at cost. The investments include the goodwill identified on acquisition, less any cumulative loss in value. The consolidated financial statements include the share of profits and losses of the investees recognised under the equity method, net of any adjustments necessary to align accounting principles, on the date in which significant influence commences or the joint control until the date such influence or control ceases. When the share of the loss of an investment recognised under the net equity method exceeds the book value of the investee, the investment is written-down and the share of the further losses are not recorded except in the cases where there is a legal or implied contractual obligation or where payments were made on behalf of the investee.
AFS financial assets are comprised of other investments (generally with holdings below 20%) and are measured at fair value with changes through equity. When the reduction in value compared to the acquisition cost constitutes "loss in value", the effect of the adjustment is recognised through the income statement. Where the conditions that resulted in the write-down no longer exist, the recovery is recorded through equity.
The fair value is identified in the case of listed investments with the stock exchange price at the balance sheet date and in the case of investments in non-listed companies utilising valuation techniques. These valuation techniques include the comparison with the values taken from similar recent operations and other valuation techniques which are substantially based on the analysis of the capacity of the investee to produce future cash flows, discounted to reflect the time value of money and the specific risks of the activities undertaken.
The investments in equity instruments which do not have a listed price on a regulated market and whose fair value cannot be reasonably valued, are measured at cost, reduced by any loss in value.
The choice between the above-mentioned methods is not optional, as these must be applied in hierarchal order: absolute priority is given to official prices available on active markets (effective market quotes – level 1) or for assets and liabilities measured based on valuation techniques which take into account observable market parameters (comparable approaches – level 2) and the lowest priority to assets and liability whose fair value is calculated based on valuation techniques which take as reference non-observable parameters on the market and therefore more discretional (market model – level 3).
Within the analysis which the Group carried out regarding the introduction of the new Accounting Standards illustrated above, and in particular IFRS 9, the necessity to review some measurement criteria previously applied in relation to the Accounting Standards in force should be noted. Specifically, in consideration of the current market context, the threshold related to the prolonged presence of market values below cost for listed equities classified as available for sale financial assets, previously determined as 18 months, is no longer considered adequate to the circumstances which at the time gave rise to the above-mentioned determination. In particular, the high volatility of the financial markets in the first months of 2016, based on the nature of the investment Portfolio of the Group, suggested the redetermination of the above-mentioned threshold to 36 months, from the year 2016, in order not to record such atypical volatility in the income statement through any write-downs, in the firm belief that the new time profile cited above more adequately reflects the current situation of an effective "prolonged" time period.
Therefore, in relation to equity securities listed in active markets it is considered that the Group, in relation to the nature of its investment portfolio in small/mid cap Italian companies, recognises a reduction of value in the presence of a market price at the balance sheet date lower than the purchase price by at least 50% or in the prolonged presence for over 36 months of a market value below cost. In any case, even the securities that have reported values which are within the above-mentioned threshold are subject to analysis and – where considered appropriate – written down for impairment. The adoption of the new time period resulted in a marginal impact (approximately Euro 0.5 million) on the present consolidated financial statements.
Receivables are recorded at fair value and subsequently measured at amortised cost. They are adjustments for sums considered uncollectible.
They concern non-derivative financial assets comprising investments made under capital management and in bond securities, made for the temporary utilisation of liquidity, valued at fair
value with changes recorded through equity. When the reduction in value compared to the acquisition cost constitutes "loss in value", the effect of the adjustment is recognised through the income statement. Where the reasons for the loss in value no longer exist, the recovery is recognised to equity in the case of equity instruments. In the case of bond securities, where the conditions resulted in the write-down no longer exists, the recovery is recognised to the income statement.
In relation to the fair value measurement methods utilised reference should be made to the previous paragraph "Non-current AFS financial assets".
Current financial assets comprise securities which represent short-term commitment of available liquidity, held for trading purposes. These are therefore classified as trading instruments and measured at fair value with changes recorded through the income statement.
The purchases and sales of securities are recorded and cancelled at the settlement date.
Cash and cash equivalents include those values which are available on demand at short notice (within three months), certain in nature and with no payment expenses.
For the purposes of the Statement of Cash Flows, available liquidity is represented by cash and cash equivalents less bank overdrafts at the balance sheet date.
Trade payables are initially recorded at fair value and subsequently measured at amortised cost. The financial liabilities are recorded at amortised cost using the effective interest rate method. In particular, the convertible bonds record, based on the indications contained in IAS 32, the financial liability components separately (measured at amortised costs), and the implicit options assigned to the holders of the instruments to covert part of the loan into an equity instrument.
The benefits guaranteed to employees paid on the termination of employment or thereafter through defined benefit plans are recognised in the period the right matures. The liability for defined benefit plans, net of any plan assets, is calculated on the basis of actuarial assumptions and is recorded by the accrual method consistent with the years of employment necessary to obtain such benefits. The liability is calculated by independent actuaries.
The Company recognises additional benefits to some employees through stock option plans.
According to IFRS 2 – Share-based payments, these plans are a component of the remuneration of the beneficiaries and provide for application of the "equity settlement" method. Therefore, the relative cost is represented by the fair value of the stock options at the grant date, and is recognised in the income statement over the period between the grant date and the maturity date, and directly recorded under equity.
The treasury shares held by the parent company are recorded as a reduction from equity. The original cost of the treasury shares and the revenues deriving from any subsequent sale are recognised as equity movements.
Revenues are recognised to the extent that their fair value can be reliably calculated and based on the probability that their economic benefits will be received. According to this type of operation, the revenues are recognised on the basis of the specific criteria indicated below:
Where it is not possible to reliably determine the value of revenues, they are recognised up to the costs incurred which may reasonably be recovered.
The income and charges deriving from the sale of investments and shares are recorded on an accruals basis, recording changes in fair value to the income statement which were previously recognised through equity.
Financial income and charges are recorded on an accruals basis on the interest matured on the net value of the relative financial assets and liabilities and utilising the effective interest rate.
The dividends are recorded in the year in which the right of the shareholders to receive the payment arises. The dividends received from investments valued under the equity method were recorded as a reduction in the value of the investments.
Current income taxes for the period are determined based on an estimate of the taxable assessable income and in accordance with current legislation. Deferred tax assets and liabilities are calculated on temporary differences between the values recorded in the financial statements and the corresponding values recognised for fiscal purposes. The recognition of deferred tax assets is made when their recovery is probable - that is when it is expected that there will be future assessable fiscal income sufficient to recover the asset. The recovery of the deferred tax asset is reviewed at each balance sheet date. Deferred tax liabilities are always recorded in accordance with the provisions of IAS 12.
The choices adopted by the Group relating to the presentation of the consolidated financial statements is illustrated below:
statement of financial position: in accordance with IAS 1, the assets and liabilities should be classified as current or non-current or, alternatively, according to the liquidity order. The Group chose the classification criteria of current and non-current;
income statement and comprehensive income statement: IAS requires alternatively classification based on the nature or destination of the items. The Group decided to utilise the presentation calculation by nature of expenses;
The company undertakes investment banking and merchant banking activities. Top management activity in the above-mentioned areas, both at marketing contact level and institutional initiatives and direct involvement in the various deals, is highly integrated. In addition, execution activity is also organised with the objective to render the "on-call" commitment of advisory or equity professional staff more flexible.
In relation to this choice it is almost impossible to provide a clear representation of the separate financial economic impact of the different areas of activity, as the breakdown of the personnel costs of top management and other employees on the basis of a series of estimates related to parameters which could be subsequently superseded by the actual operational activities would result in an extremely high distortion of the level of profitability of the segments of activity.
In the present consolidated financial statements only details on the performance of the "revenues from sales and services" component is provided, related to the sole activity of advisory, excluding therefore the account "other revenues".
| Euro | 2016 | 2015 |
|---|---|---|
| Revenue from sales and services | 12,206,785 | 3,977,113 |
| Total | 12,206,785 | 3,977,113 |
The significant increase in revenues is due to the excellent performance of the normal activities of advisory and the fees related to the start-up of Asset Italia S.p.A.
| The account comprises: | ||
|---|---|---|
| Euro | 2016 | 2015 |
| 1. Services |
1,532,337 | 1,647,146 |
| 2. Rent, leasing and similar costs |
354,767 | 366,480 |
| 3. Other charges |
290,735 | 183,766 |
| Total | 2,177,839 | 2,197,392 |
Service costs mainly relate to professional and legal consultancy, general expenses and commercial expenses. They include Euro 85,000 of audit fees and Euro 64,250 emoluments paid to the Board of Statutory Auditors and the Supervisory Board.
Other charges principally include non-deductible VAT.
The account comprises:
| Euro | 2016 | 2015 |
|---|---|---|
| Wages and salaries | 1,443,117 | 1,139,333 |
| Social security expenses | 394,458 | 302,161 |
| Directors' fees | 17,054,014 | 5,285,103 |
| Stock option charges | 5,722,750 | 0 |
| Post-employment benefits | 62,652 | 55,225 |
| Total | 24,676,991 | 6,781,822 |
The account "Wages and salaries" and "Directors' fees" includes fixed and variable remuneration matured in the year. The higher revenues and the 2016 pre-tax result saw an increase in the variable remuneration compared to 2015.
The cost includes, in addition, Euro 5,722,750 of charges relating to the assignment of 3,500,000 options under the "2014-2021 TIP Incentive Plan".
In line with IFRS 2, the options allocated were measured according to the equity settlement method. The fair value of the option was measured utilising the applicable valuation method for the given circumstances (in this case the Black & Scholes method), taking into account the terms and conditions by which the rights were allocated.
The assumptions utilised for the application of the model at the assignment date, or rather September 30, 2016 and December 30, 2016 are as follows:
| TIP share price at September 30, 2016 | 3.594 |
|---|---|
| Exercise price of the Options | 1.995 |
| First day for the exercise of the options | Jan 1, 17 |
| Last day for the exercise of the options | Dec 31, 21 |
| Historic average volatility of the STAR index (360 days) | 19.79% |
| Riskless Rate (Italian Bond 2021) | 0.274% |
| Number of options originally outstanding | 2,500,000 |
| Number of options outstanding at the date | 2,500,000 |
| Number of shares per option | 1.00 |
| Number of options exercised at the date | 0 |
| Number of TIP shares issued at September 30, 2016 | 147,799,487 |
| TIP share price at December 31, 2016 | 3.600 |
| Exercise price of the Options | 1.995 |
| First day for the exercise of the options | Jan 1, 17 |
| Last day for the exercise of the options | Dec 31, 21 |
| Historic average volatility of the STAR index (360 days) | 18.71% |
| Riskless Rate (Italian Bond 2021) | 0.596% |
| Number of options originally outstanding | 2,500,000 |
| Number of options outstanding at the date Number of shares per option |
3,500,000 1.00 |
| Number of options exercised at the date | 0 |
| Number of TIP shares issued at December 31, 2016 | 147,799,487 |
"Post-employments benefits" are updated based on actuarial valuations, with the gains or losses recognised through equity.
At December 31, 2016, the number of TIP employees was as follows:
| December 31, 2016 | December 31, 2015 | |
|---|---|---|
| White collar & apprentices | 11 | 10 |
| Managers | 1 | 1 |
| Executives | 4 | 3 |
| Total | 16 | 14 |
The Chairman/CEO and Vice Chairman/CEO are not employees either of TIP or of Group companies.
| The account comprises: | ||
|---|---|---|
| Euro | 2016 | 2015 |
| 1. Investment income |
108,462,166 | 21,887,753 |
| 2. Income from securities recorded in current assets |
2,311,318 | 10,939,394 |
| Other income | 1,260,287 | 525,481 |
| Total financial income | 112,033,771 | 33,352,638 |
| 3. Interest and other financial charges |
(19,874,805) | (9,737,643) |
| Total financial charges | (19,874,805) | (9,737,643) |
| Net financial income | 92,158,966 | 23,614,995 |
| (7).1. Investment income | ||
| Euro | 2016 | 2015 |
| Gain on withdrawal from Ruffini Partecipazioni S.r.l. | 78,008,920 | 0 |
| Gain on Ferrari N.V. share | 15,960,812 | 0 |
| Gain on disposal of investments | 10,601,386 | 15,336,870 |
| Dividends | 3,891,048 | 3,112,334 |
| Gains on liquidation of investments | 0 | 3,438,549 |
| Total | 108,462,166 | 21,887,753 |
Following the withdrawal from Ruffini Partecipazioni S.r.l., the subsidiary Clubsette S.r.l. received the Moncler S.p.A. shares previously held by Ruffini Partecipazioni. This operation generated for Clubsette S.r.l. a gain of Euro 78,008,920, equal to the difference between the value at cost of the investment in Ruffini Partecipazioni S.r.l. and the payment on withdrawal comprising the Moncler shares received, measured as the trading price on the day of the operation. Clubsette S.r.l. was then placed in liquidation and the Moncler shares were assigned to the shareholders. The closure of the liquidation was on December 29, 2016.
Following the spin-off of Ferrari from FCA on January 4, 2016, TIP received 174,000 Ferrari shares based on the FCA shares held at December 31, 2015 and 193,422 FCA convertible securities. These transactions, in accordance with IFRS, were recorded for accounting purposes as a dividend distribution and therefore generated a gain in the income statement of approximately Euro 16 million, equal to the market value of the Ferrari shares communicated by the Stock
Exchange on January 4, 2016. On the other hand, the decrease in the value of the convertible loan following the distribution of the Ferrari shares and the consequent performance of the FCA securities resulted in a significant initial charge. During the year, this charge reduced significantly to approximately Euro 9 million. The net effect of the approximately Euro 16 million gain and the charge of approximately Euro 9 million above was therefore a net gain of approximately Euro 7 million booked to the income statement in 2016, in addition to interest matured on the convertible bond of approximately Euro 1.9 million.
For the statement of financial position, the above operations resulted in an initial significant decrease in the fair value reserve attributable to FCA and also this negative effect reduced to approximately Euro 1.5 million at December 31, 2016
The recovery in the FCA and Ferrari share prices continued into 2017 and the fair value of these investments is today well above their initial recognition value, including for the FCA shares received from the conversion on December 15, 2016.
In 2016, the gains relate to the sale of the following investments (Euro):
| Bolzoni S.p.A. | 6,326,818 |
|---|---|
| Noemalife S.p.A. | 4,003,582 |
| Other | 270,986 |
| Total | 10,601,386 |
In 2016, TIP received dividends from the following shareholdings:
| Euro | |
|---|---|
| Hugo Boss AG | 2,534,000 |
| Furn Invest Sas | 416,436 |
| Amplifon S.p.A. | 410,132 |
| Ferrari N.V. | 324,347 |
| Other | 206,133 |
| Total | 3,891,048 |
| Euro | 2016 | 2015 |
|---|---|---|
| Interest on securities in current assets | 1,998,102 | 3,407,676 |
| Gain on sale of securities | 313,216 | 2,406,827 |
| Unrealised gains on securities | 0 | 4,738,544 |
| Exchange differences on sale of securities | 0 | 386,347 |
| Total | 2,311,318 | 10,939,394 |
| Euro | 2016 | 2015 |
|---|---|---|
| Unrealised losses on securities | 8,989,959 | 0 |
| Interest on bonds | 6,763,447 | 6,679,381 |
| Incentive plan costs (stock option) | 0 | 1,324,838 |
| Other | 4,121,399 | 1,733,424 |
| Total | 19,874,805 | 9,737,643 |
The unrealised losses on securities follows the application of IFRS to the performance of the investment in the FCA convertible loan, resulting in a loss also following the spin-off of the investment in Ferrari N.V. This impact should be, at least from an operational profile, considered jointly with the income of Euro 16 million outlined in Note 7.1.
"Interest on bonds" refers to that matured in favour of the partial convertible bond of Euro 40 million, as well as the 2014-2020 TIP Bond of Euro 100 million calculated in accordance with the amortised cost method applying the effective interest rate. The bond partially convertible was repaid in advance in December 2016 through the drawdown of a bank loan at much more favourable conditions.
The "Other" account includes bank interest, on loans, losses realised on securities and other financial charges.
The incentive plan costs in 2015 included the changes in the fair value relating to the liability to directors and employees as the plan provided for a cash settlement. The new plan in 2016, which provides for an equity settlement except where otherwise resolved by the Board, does not result in any financial adjustment for charges already recorded under personnel costs.
| Euro | 2016 | 2015 |
|---|---|---|
| Asset Italia S.p.A. | (126,688) | 0 |
| BE Think, Solve, Executive S.p.A. | 737,195 | 217,239 |
| Clubtre S.p.A. | 1,471,760 | 881,283 |
| Clubitaly S.p.A. | 23,421 | (116,549) |
| Data Holding 2007 S.r.l. | 0 | 70,532 |
| Gruppo IPG Holding S.p.A. | 6,365,753 | 6,898,400 |
| Gatti & Co. Gmbh | 10,518 | 0 |
| Palazzari & Turries Limited | (12,656) | 32,725 |
| TIP -Pre IPO – TIPO S.p.A. | 2,139,974 | 377,369 |
| Total | 10,609,277 | 8,360,999 |
The account comprises:
For further details, reference should be made to note 13 "Investments in associates measured under the equity method" and attachment 3.
| Euro | 2016 | 2015 |
|---|---|---|
| Write-down of AFS financial assets | (2,140,137) | (288,653) |
| Total | (2,140,137) | (288,653) |
The write-down in the period relates mainly to minor investments. Reference should be made to attachment 2 of these Explanatory Notes for a breakdown of the write-downs.
The breakdown of income taxes is as follows:
| Euro | 2016 | 2015 |
|---|---|---|
| Current income taxes | 1,740,939 | 1,476,687 |
| Deferred tax income | (1,318,449) | 196,165 |
| Deferred tax charge | 70,764 | 124,877 |
| Total | 493,254 | 1,797,729 |
The reconciliation between the theoretical and actual tax charges is provided below:
| 2016 | 2015 | |||
|---|---|---|---|---|
| Euro | Amount | Tax | Amount | Tax |
| Profit before taxes | 86,126,623 | 26,792,981 | ||
| Theoretical tax charge | 27.50% | 23,684,821 | 27.50% | 7,368,070 |
| Permanent decreases | ||||
| Dividends | (3,652,275) | (1,004,376) | (3,007,134) | (826,962) |
| Exempt gains (*) | (75,456,982) | (20,750,670) | (10,969,729) | (3,016,675) |
| Tax losses | 76,276 | 20,976 | 53,155 | 14,618 |
| Other permanent decreases | (18,274,095) | (5,025,376) | (2,907,637) | (799,600) |
| (26,759,446) | (4,628,620) | |||
| Permanent increases | 26,948,083 | 7,410,723 | 932,633 | 256,474 |
| Temporary differences | ||||
| Differences which will reverse in future years | (1,850,271) | (508,825) | (1,933,383) | (531,680) |
| Reversal differences from previous years | (2,442,758) | (671,758) | (3,028,558) | (832,853) |
| Total temporary differences | (1,180,583) | (1,364,534) | ||
| ACE assessable | (8,538,198) | (2,348,004) | (85,796) | (23,593) |
| Losses carried forward | (201,540) | (55,424) | (1,469,968) | (404,241) |
| Total | 2,734,863 | 752,087 | 4,376,564 | 1,203,555 |
| IRAP regional tax | 303,660 | 273,132 | ||
| Change in deferred tax assets/liabilities | (1,247,681) | 321,042 | ||
| Other changes | 685,188 | 0 | ||
| Total income taxes | 493,254 | 1,797,729 |
(*) The tax charge is principally due to the application of the PEX regime on the gains realised on the equity investments.
The company recognised directly to equity a net decrease in deferred tax liabilities amounting to Euro 767,663 in relation to the increase in the value of the financial assets available-for-sale.
The following table illustrates the changes in the account:
| Other | |
|---|---|
| Euro | assets |
| Net value at December 31, 2014 | 69,657 |
| Increases | 74,871 |
| Decreases | 0 |
| Decrease depreciation provision | 0 |
| Depreciation | (30,434) |
| NBV at December 31, 2015 | 114,094 |
| Increases | 107,940 |
| Decreases | (20,817) |
| Decrease depreciation provision | 20,817 |
| Depreciation | (51,445) |
| NBV at December 31, 2016 | 170,589 |
The increase in "Other Assets" mainly refers to the purchase of EDP, furniture and fittings, motor vehicles and mobile telephones.
"Goodwill" for Euro 9,806,574 refers to the incorporation of the subsidiary Tamburi & Associati S.p.A. into TIP S.p.A. in 2007.
In accordance with IAS 36 the value of goodwill, having an indefinite useful life, is not amortised, but subject to an impairment test, made at least annually.
The recoverable value is estimated based on the value in use, calculated using the following assumptions:
The following illustrates the changes in "Other intangible assets":
| Euro | Industrial patents and intellectual property rights |
Concessions, licences and trademarks |
Total |
|---|---|---|---|
| Net value at December 31, 2014 | 840 | 536 | 1,376 |
| Increases | 840 | - | 840 |
| Decreases | - | - | - |
| Amortisation | (700) | (206) | (906) |
| Net value at December 31, 2015 | 980 | 330 | 1,310 |
| Increases | 6,219 | - | 6,219 |
| Decreases | - | - | - |
| Amortisation | (2,773) | (130) | (2,903) |
| Net value at December 31, 2016 | 4,426 | 200 | 4,626 |
| registeredd | % | ||||
|---|---|---|---|---|---|
| Company | officee | share capital | shares | holding | Held |
| Clubtre S.p.A. | Milan | 120,000 | 120,000 | 42,000 | 35.00 |
| Clubitaly S.p.A. | Milan | 100,000 | 100,000 | 27,500 | 27.50 |
| Gruppo IPG Holding S.p.A | Milan | 142,438 | 284,875 | 67,348 | 23.64 Milan |
| TIP-Pre IPO S.p.A. | Milan | 244,284 | 1,200,000 | 342,856 | 28.57 |
| BE Think, Solve, Executive S.p.A. | Rome | 27,109,165 | 134,897,272 | 31,582,225 | 23.41 |
| Palazzari & Turries Limited | Hong Kong | 300,000 (1) | 300,000 | 90,000 | 30.00 |
| Gatti & Co. Gmbh | Frankfurt | 35,700 | 35,700 | 10,700 | 29.97 |
(1) In Hong Kong Dollars.
The investments in associated companies refer to:
For the changes in the investments in associated companies reference should be made to attachment 3.
The financial assets refer to minority investments in listed and non-listed companies.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Investments in listed companies | 299,610,001 | 189,379,051 |
| Investments in non-listed companies | 74,657,041 | 240,039,235 |
| Total | 374,267,042 | 429,418,286 |
The changes in the investments measured at fair value are shown in Attachment 2.
In relation to the effects of the measurement of investments in listed companies reference should be made to note (9) and note (23).
The Moncler operation had a substantial impact on movements in the year as resulting in the allocation to Clubsette S.r.l. in liquidation of Moncler shares following the withdrawal from Ruffini Partecipazioni and subsequently the allocation by Clubsette S.r.l. to its shareholders, including TIP S.p.A., of its assets and in particular Moncler shares.
The main increases in the year, in addition to those relating to Moncler, relate to the Ferrari shares received following the previously mentioned spin-off and the FCA shares received from the conversion of the FCA convertible bond.
The composition of the valuation methods of the non-current financial assets available for sale relating to investments in listed and non-listed companies is illustrated in the table below:
| Listed companies | Non-listed companies | |
|---|---|---|
| Method | (% of total) | (% of total) |
| Listed prices on active markets (level 1) | 100.0% | 0.0% |
| Valuation models based on market inputs (level 2) | 0.0% | 52.2% |
| Other valuation techniques (level 3) | 0.0% | 45.8% |
| Purchase cost | 0.0% | 1.7% |
| Total | 100.0% | 100.0% |
The TIP group, through TXR S.r.l., currently holds 38.34% of Furn Investment S.a.s., a company which holds approximately 99% of Roche Bobois Groupe.
This investment, at December 31, 2016, was not classified as an associated company, although in the presence of a holding above 20% and some indicators of significant influence.
In particular, Furn Investment S.A.S. is unable to provide periodic financial information such as to permit the TIP Group to record the investment under the equity method.
The unavailability of such information represents a limitation in the exercise of significant influence and consequently it was considered appropriate to qualify the investment as available for sale.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Non-current loans | 33,751,593 | 8,218,972 |
| Total | 33,751,593 | 8,218,972 |
The non-current loans recognised at amortised cost refer to:
The interest matured on loans which will be received within one year are classified in the account current financial receivables.
The breakdown is as follows:
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| VAT Receivables | 18,153 | 74,570 |
| IRES corp. tax receivables | 273,130 | 28 |
| IRAP regional tax receivables | 25,317 | 6,566 |
| Tax receivables for post-employment benefit revaluation | 0 | |
| Other withholdings | 19,773 | 361,008 |
| Total (within one year) | 336,373 | 442,172 |
| Due beyond one year | ||
| Tax receivables – tax credit | 0 | 144,119 |
| Tax receivables – IRAP reimbursement | 136,116 | 13,736 |
| Tax receivables – IRAP reimbursement 2007-2011 | 0 | 135,932 |
| Total (beyond one year) | 136,116 | 293,787 |
The breakdown of the account at December 31, 2016 and December 31, 2015 is detailed below:
| Euro | Assets | Liabilities | Net | |||
|---|---|---|---|---|---|---|
| 31/12/2016 | 31/12/2015 | 31/12/2016 | 31/12/2015 | 31/12/2016 | 31/12/2015 | |
| Other intangible assets | 3,140 | 2,773 | 3,140 | 2,773 | ||
| Non-curr. AFS fin. assets and investees under equity method |
14,559 | 42,593 | (3,069,455) | (2,132,928) | (3,054,896) | (2,090,335) |
| Current AFS financial assets | (98,100) | (98,100) | ||||
| Profit/(loss) | 23,760 | 27,151 | (8,969) | (8,969) | 14,791 | 18,182 |
| Elimination inter-company margins | 86,204 | 86,204 | ||||
| Other liabilities | 2,101,930 | 666,219 | 2,101,930 | 666,219 | ||
| Total | 2,143,389 | 824,940 | (3,078,424) | (2,239,997) | (935,035) | (1,415,057) |
| December 31, | Recorded through |
Recorded through |
December 31, | |
|---|---|---|---|---|
| Euro | 2015 | P&L | Equity | 2016 |
| Other intangible assets | 2,773 | 367 | 3,140 | |
| Non-curr. AFS fin. assets and investees under equity method |
(2,090,335) | (98,798) | (865,763) | (3,054,896) |
| Current AFS financial assets | (98,100) | 98,100 | ||
| Profit/(loss) | 18,182 | (3,391) | 14,791 | |
| Elimination inter-company margins | 86,204 | (86,204) | ||
| Other liabilities | 666,219 | 1,435,711 | 2,101,930 | |
| Total | (1,415,057) | 1,247,685 | (767,663) | (935,035) |
The changes in the tax assets and liabilities were as follows:
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Trade receivables (before doubtful debt provision) | 1,125,786 | 2,744,143 |
| Doubtful debt provision | (167,809) | (162,579) |
| Total | 957,977 | 2,581,564 |
| Trade trade receivables beyond 12 months | - | - |
| Total beyond 12 months | - | - |
Changes in trade receivables is strictly related to the different revenue mix between success fees and service revenues.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Bonds and other debt securities | 182,701 | 26,946,127 |
| Total | 182,701 | 26,946,127 |
At December 31, 2015, the account included the FCA convertible bond loan, whose conversion into FCA shares took place on December 15, 2016.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Bond securities | 0 | 21,613,809 |
| Total | 0 | 21,613,809 |
The decrease in current AFS financial assets is essentially due to the utilisation of financial resources for investment activity in the year.
The account represents the balance of banks deposits determined by the nominal value of the current accounts with credit institutions.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Bank deposits | 1,281,871 | 2,006,216 |
| Cash in hand and similar | 4,898 | 4,889 |
| Total | 1,286,769 | 2,011,105 |
The composition of the net financial position at December 31, 2016 compared with the end of
the previous year is illustrated in the table below.
| Euro | December 31, 2016 | December 31, 2015 | |
|---|---|---|---|
| A | Cash and cash equivalents | 1,286,769 | 2,011,105 |
| B | Current financial assets | 182,701 | 48,559,936 |
| C | Current financial receivables | 483,136 | - |
| D | Liquidity (A+B+C) | 1,952,606 | 50,571,041 |
| E | Financial payables | (133,752,298) | (138,594,609) |
| F | Current financial liabilities | (67,380,227) | (89,417,843) |
| G | Net Financial Position | (199,179,919) | (177,441,411) |
The net financial position increased following the utilisation of current assets for investment in equity holdings, including the conversion of the convertible bond into FCA shares.
The current financial payables decreased mainly following the completion of the Moncler operation and the related liquidation of Clubsette.
The share capital of TIP S.p.A. is composed of:
| Shares | Number |
|---|---|
| ordinary shares | 147,799,487 |
| Total | 147,799,487 |
The Shareholders' Meeting of July 14, 2016 approved the proposal to eliminate the nominal value of TIP S.p.A. shares.
On August 13, 2016, the first exercise period of the TIP S.p.A. 2015 - 2020 Warrants concluded, with the exercise of 3,885 warrants and a relative share capital increase of Euro 2,020.20 with the issue of 3,885 new ordinary TIP S.p.A. shares at a price of Euro 3.79 each, for a total value of Euro 14,724.15.
The share capital of TIP S.p.A. amounts therefore to Euro 76,855,733, represented by 147,799,487 ordinary shares.
The treasury shares in portfolio at December 31, 2016 totalled 1,478,370, equal to 1.00% of the share capital.
| No. treasury shares at | No. of shares acquired | No. of shares sold | No. treasury shares at |
|---|---|---|---|
| January 1, 2016 | in 2016 | 2016 | December 31, 2016 |
| 541,678 | 936,692 | - | 1,478,370 |
The following additional disclosures is provided on the shareholders' equity at December 31, 2016.
This amounts to Euro 15,370,743, increasing Euro 448,774 following the Shareholders' Meeting motion of April 29, 2016 with regard to the allocation of the 2015 net profit.
The positive reserve amounts to Euro 98,463,565. This is an unavailable reserve as referring to the change in the fair value compared to the acquisition value of the investments in portfolio.
The changes in the non-current AFS financial assets valuation reserve, which represents the total of income and charges recognised directly through equity, is illustrated in the table below:
| Euro | Book value at 31.12.2015 |
Change | Book value 31.12.2016 |
|---|---|---|---|
| Non-current AFS financial assets | 76,405,721 | (40,643,266) | 35,762,455 |
| Investments measured under the equity method | 38,322,568 | 26,933,361 | 65,255,929 |
| Current AFS financial assets | 281338 | (281,338) | 0 |
| Tax effect | (1,787,156) | (767,663) | (2,554,819) |
| Total | 113,222,471 | (14,758,906) | 98,463,565 |
| of which: | |||
| Group share | 90,819,062 | 5,359,364 | 96,178,426 |
| minority interest share | 22,403,409 | (20,118,270) | 2,285,139 |
The table below illustrates the implicit gains of the investments and of the current financial assets in the year which are recognised under equity in the account "Valuation reserve AFS financial assets".
For details of changes, reference should be made to attachment 2 and to note 10 (Non-current AFS financial assets) and attachment 14 and note 13 (Investments measured under the equity method).
For the changes in the year and breakdown of other equity items reference should be made to the specific statement.
The negative reserve amounts to Euro 4,853,854. This relates to a non-distributable reserve.
They amount to Euro 10,153,111 and refer for Euro 5,722,750 to the stock option plan reserve created following the allocation of options to employees and directors which will presumably be settled through the equity settlement method.
The merger surplus amounts to Euro 5,060,152 and derives from the incorporation of Secontip
S.p.A. into TIP S.p.A. on January 1, 2011.
Retained earnings amount to Euro 56,977,958 and increased, compared to December 31, 2015, Euro 15,838,399 following the allocation of the 2015 net profit.
During the year, dividends of Euro 8,946,714 were distributed, equal to Euro 0.061 per share.
The reserve was negative and amounts to Euro 483,655, unchanged compared to December 31, 2015.
The following table shows reconciliation between Parent Company and Consolidated net equity and net profit.
| Euro | Equity at January 1, 2016 |
2016 Result | Other changes |
Group net equity at December 31, 2016 |
Minority interest equity |
Equity at December 31, 2016 |
|---|---|---|---|---|---|---|
| Parent Company Equity as per separate financial statements |
286,384,779 | 41,072,198 | (3,342,060) | 324,114,917 | 324,114,917 | |
| Eliminations in separate financial statements Carrying value and adjustments of |
(37,917,385) | 37,033,759 | (883,626) | (883,626) | ||
| investments measured under the equity method |
51,653,539 | 10,609,276 | 32,337,001 | 94,599,816 | 94,599,816 | |
| Net equity and result for the year (determined in accordance with uniform accounting principles) of the companies consolidated |
93,018,289 | 37,722,300 | (113,268,016) | 17,472,573 | 16,787,469 | 34,260,042 |
| Elimination carrying value of consolidated companies |
(66,776,965) | 51,762,520 | (15,014,445) | (15,014,445) | ||
| Equity attributed to the shareholders of the parent from the consolidated financial |
||||||
| statements | 364,279,642 | 51,486,389 | 4,523,204 | 420,289,235 | 16,787,469 | 437,076,704 |
At December 31, 2016, the basic earnings per share – net profit divided by the number of shares in circulation (146,321,117) taking into account treasury shares at the same date – was Euro 0.35.
At December 31, 2016, the diluted earnings per share was Euro 0.34. This represents the net profit for the year divided by the number of ordinary shares in circulation at December 31, 2016, calculated taking into account the treasury shares held at the same date and considering any dilution effects generated from the shares servicing the stock option plan (3,500,000) and from the newly issued shares (36,945,015) relating to the remaining warrants in circulation.
At December 31, 2016, the balance of the account related to the Post-Employment Benefit due
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Opening balance | 226,451 | 210,646 |
| Provisions in the year | 67,455 | 31,460 |
| Actuarial gains/losses | 20,087 | (7,811) |
| Transfers to pension funds and utilisations | (42,326) | (7,844) |
| Total | 271,667 | 226,451 |
to all employees of the company at the end of employment service. The liability was updated based on actuarial calculations.
Financial payables of Euro 133,752,298 refer to:
The bond provides for compliance with annual financial covenants.
In accordance with the application of international accounting standards required by Consob recommendation No. DEM 9017965 of February 6, 2009 and the Bank of Italy/Consob/Isvap No. 4 of March 4, 2010, we report that this account does not include any exposure related to covenants not complied with.
These amount to Euro 67,380,277 and principally comprise bank payables of the parent company of Euro 64,032,820 and interest on bonds for Euro 3,347,457.
The breakdown of the account is as follows:
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| IRES | 0 | 1,200,390 |
| IRAP | 303,660 | 0 |
| VAT | 10,554 | 0 |
| Withholding taxes | 114,825 | 591,985 |
| Total | 429,039 | 1,792,375 |
The account mainly refers to emoluments for directors and employees.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Directors and employees | 16,534,243 | 4,739,721 |
| Directors for stock options | 0 | 1,449,525 |
| Social security institutions | 174,297 | 112,455 |
| Others | 111,660 | 235,115 |
| Total | 16,820,200 | 6,536,816 |
The Group, by nature of its activities, is exposed to various types of financial risks - in particular to the risk of changes in market prices of investments and, marginally, to the risk of interest rates. The policies adopted by the Group for the management of the financial risk are illustrated below.
The Group is exposed to the interest rate risk relating to the value of the current financial assets represented by bonds.
The Group, by nature of its activities, is exposed to the risk of changes in the value of the investments.
In relation to the listed investments at the present moment there is no efficient hedging instrument of a portfolio such as those with the characteristics of the Group.
Relating to non-listed companies, the risks related:
were not hedged through specific derivative instruments as not available. The Group attempts to minimise the risk – although within a merchant banking activity and therefore by definition risky – through a careful analysis of the companies and sectors on entry into the share capital, as well as through careful monitoring of the performance of the investee companies after entry in the share capital.
A sensitivity analysis is reported below which illustrates the effects resulting from, respectively on the income statement and on the balance sheet, of a hypothetical change in the fair value of the instruments held at December 31, 2016 of +/-5% compared to the comparative figures for 2015.
| Sensitivity Analysis | December 31, 2016 | December 31, 2015 | |||||
|---|---|---|---|---|---|---|---|
| thousands of Euro | -5.00% | Basic | +5.00% | -5.00% | Basic | +5.00% | |
| Investments in listed companies | 284,630 | 299,610 | 314,591 | 179,910 | 189,379 | 198,848 | |
| Investments in non-listed companies | 70,924 | 74,657 | 78,390 | 38,017 | 40,018 | 42,019 | |
| Non-current AFS financial assets | 355,554 | 374,267 | 392,980 | 217,927 | 229,397 | 240,867 | |
| Bonds and other debt securities | 173 | 182 | 191 | 25,599 | 26,946 | 28,293 | |
| Current financial assets | 173 | 182 | 191 | 25,599 | 26,946 | 28,293 | |
| Asset management | 0 | 0 | 0 | 0 | 0 | 0 | |
| Bond securities | 0 | 0 | 0 | 20,533 | 21,614 | 22,695 | |
| ETF | 0 | 0 | 0 | 0 | 0 | 0 | |
| AFS financial assets | 0 | 0 | 0 | 20,533 | 21,614 | 22,695 | |
| Effects on the result | (9) | 9 | (1,347) | - | 1,347 | ||
| Effects on the revaluation reserve financial assets |
(18,713) | 18,713 | (12,551) | - | 12,551 |
The Group's exposure to the credit risk depends on the specific characteristics of each client as well as the type of activities undertaken and in any case at the preparation date of the present financial statements is not considered significant.
Before undertaking an assignment, careful analysis is undertaken on the credit reliability of the client.
The Group approach in the management of liquidity guarantees, where possible, that there are always sufficient funds to meet current obligations.
At December 31, 2016, the credit lines available and not utilised of the TIP Group amounted to Euro 19.8 million.
The capital management policies of the Board of Directors provide for maintaining high levels of own capital in order to maintain a relationship of trust with investors, allowing for future development.
The parent company acquired treasury shares on the market on the basis of available prices.
The classification of financial instruments at fair value in accordance with IFRS 13 is determined based on the quality of the input sources used in the valuation, according to the following hierarchy:
level 3: determination of fair value based on valuation models whose input is not based on observable market data ("unobservable inputs"). These refer for example to valuations of non-listed investments based on Discounted Cash Flow valuation methods.
In accordance with the disclosures required by IFRS 13, the types of financial instruments recorded in the financial statement at December 31, 2016 are illustrated below with indication of the accounting policies applied and, in the case of financial instruments measured at fair value, of the exposure to changes in fair value (income statement or equity), specifying also the hierarchical level of fair value attributed.
Type of instrument Accounting policies applied in accounts for financial instruments fair value at 31.12.2016 fair value Amortised cost Invest. at cost Book value at 31.12.2016 with change in fair value recorded through: Total fair value Fair value hierarchy thousands of Euro P&L equity 1 2 3 AFS financial assets of which 374,267 374,267 374,267 374,267 - listed companies 299,610 299,610 299,610 299,610 - non-listed companies 74,657 74,657 38,990 34,226 1,441 74,657 74,657 Financial receivables 1 34,235 34,235 34,235 Trade receivables 1 957 957 957 Current financial assets 182 182 182 182 AFS financial assets Cash and cash equivalents 1 1,287 1,287 1,287 Other current assets 1 272 272 272 Non-current financial payables 2 133,752 133,752 142,762 Trade payables 1 550 550 550 Current financial liabilities 1 67,380 67,380 67,380 Other liabilities 1 16,820 16.,820 16,820
The final column of the following tables shows, where applicable, the fair value at the end of the period of the financial instrument.
Note
For these accounts the fair value was not calculated as their carrying value approximates this value.
The account includes items whereby the fair value was not calculated as their carrying value approximates this value.
The following tables report the financial instruments of the parent company TIP directly and indirectly held at the end of the period, also through trust companies, communicated to the company by the members of the Board of Directors. The table also illustrates the financial instruments acquired, sold and held by the parties in 2016.
| Members of the Board of Directors | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Name | No. of No. of shares shares Office held at acquired December in 2016 31, 2015 |
No. of shares allocated from exercise of TIP warrant |
No. of shares sold in 2016 |
No. of shares held at December 31, 2016 |
||||||||
| Giovanni Tamburi(1) | Chair. & CEO | 10,916,670 | 160,481 | 11,077,151 | ||||||||
| Alessandra Gritti | Vice Chair. & Exec. Dir. |
1,833,943 | 98,000 | 1,931,943 | ||||||||
| Cesare d'Amico(2) | Vice Chairman | 18,250,624 | 250,000 | 18,500,624 | ||||||||
| Claudio Berretti | Dir. & Gen. Manager |
1,436,864 | 10,000 | 1,446,864 | ||||||||
| Alberto Capponi | Director | 0 | 0 | |||||||||
| Paolo d'Amico(3) | Director | 17,600,000 | 250,000 | 17,850,000 | ||||||||
| Giuseppe Ferrero | Director | 2,765,815 | 155,183 | 2,920,998 | ||||||||
| Manuela Mezzetti | Director | 59,702 | 59,702 | |||||||||
| Daniela Palestra | Director | 0 | 0 | |||||||||
| Name | Office | No. of warrants held at December 31, 2015 |
No. of warrants assigned in 2016 |
No. of warrants sold in 2016 |
No. of warrants exercised in 2016 |
No of warrants held at December 31, 2016 |
||||||
| Giovanni Tamburi(1) | Chair. & CEO | 2,559,167 | 2,559,167 | |||||||||
| Alessandra Gritti | Vice Chair. & Exec. Dir. |
458,485 | 458,485 | |||||||||
| Cesare d'Amico(2) | Vice Chairman | 4,562,656 | 4,562,656 | |||||||||
| Claudio Berretti | Dir. & Gen. Manager |
311,716 | 311,716 | |||||||||
| Alberto Capponi | Director | 0 | 0 | |||||||||
| Paolo d'Amico(3) | Director | 4,400,000 | 4,400,000 | |||||||||
| Giuseppe Ferrero | Director | 691,453 | 691,453 | |||||||||
| Manuela Mezzetti | Director | 14,925 | 14,925 | |||||||||
| Daniela Palestra | Director | 0 | 0 |
(1)Giovanni Tamburi holds his investment in the share capital of TIP in part directly in his own name and in part indirectly through Lippiuno S.r.l., a company in which he holds 85.75% of the share capital.
(3)Cesare d'Amico holds his investment in the share capital of TIP through d'Amico Società di Navigazione S.p.A. (a company in which he holds directly and indirectly 50% of the share capital), through the company Fi.Pa. Finanziaria di Partecipazione S.p.A. (a company which directly holds 54% of the share capital) and through family members.
(5)Paolo d'Amico holds his investments in the share capital of TIP through d'Amico Società di Navigazione S.p.A., a company in which he holds (directly and indirectly) a 50% shareholding.
The members of the Board of Statutory Auditors do not hold shares and/or warrants of the company.
The table below reports the monetary remuneration, expressed in Euro, to the members of the boards in 2016.
| TIP office | Fees 31/12/2016 |
|---|---|
| Directors | 17,054,014 |
| Statutory Auditors | 61,250 |
The remuneration of the Supervisory Board is Euro 3,000.
TIP also signed two insurance policies with Chubb Insurance Company of Europe S.A. - a D&O and a professional TPL policy - in favour of the Directors and Statutory Auditors of TIP, of the subsidiaries, as well as the investees companies in which TIP has a Board representative, in addition to the General Managers and coverage for damage to third parties in the exercise of their functions.
The table reports the transactions with related parties during the year outlined according to the amounts, types and counterparties.
| Party | Type | Value/Balance at December 31, 2016 |
Value/Balance at December 31, 2015 |
|---|---|---|---|
| Asset Italia S.p.A. | Revenues | 476,283 | - |
| Asset Italia S.p.A. | Trade receivables | 251,470 | - |
| Betaclub S.r.l. | Revenues | 23,728 | - |
| Betaclub S.r.l. | Trade receivables | 23,728 | - |
| BE S.p.A. | Revenues | 60,000 | 60,000 |
| BE S.p.A. | Trade receivables | 30,000 | 60,000 |
| ClubTre S.p.A. | Revenues | 110,608 | 410,534 |
| ClubTre S.p.A. | Trade receivables | 50,608 | 410,225 |
| Clubitaly S.p.A. | Revenues | 30,606 | 33,204 |
| Clubitaly S.p.A. | Trade receivables | 30,606 | 31,270 |
| Clubitaly S.p.A. | Financial receivables | 220,909 | - |
| Gatti&Co. Gmbh | Revenues | - | 5,605 |
| Gatti&Co. Gmbh | Trade receivables | - | - |
| Gruppo IPG Holding S.p.A. | Revenues | 30,041 | 70,059 |
| Gruppo IPG Holding S.p.A. | Trade receivables | 30,041 | 70,059 |
| Palazzari & Turries S.r.l. | Revenues | - | - |
| Palazzari & Turries S.r.l. | Trade receivables | - | 636 |
| TIP-pre IPO S.p.A. | Revenues | 504,222 | 506,382 |
| TIP-pre IPO S.p.A. | Trade receivables | 253,964 | 502,923 |
| Services provided to companies related to the Board of Directors | Revenues | 2,025,835 | 192,247 |
| Services provided to companies related to the Board of Directors | Trade receivables | 10,810 | 90,420 |
| Services received from companies related to the Board of Directors | Costs (services received) |
7,922,858 | 2,458,488 |
| Services received from companies related to the Board of Directors | Trade payables | 7,306,399 | 1,991,488 |
| Giovanni Tamburi | Revenues (services provided) |
3,352 | 6,128 |
The services offered for all the above listed parties were undertaken at contractual terms and conditions in line with the market.
With reference to the subsequent events, reference should be made to the Directors' Report.
The TIP Group adopts the provisions of the new version of the Self-Governance Code published by Borsa Italiana as its corporate governance model.
The Corporate Governance and Ownership Structure Report for the year is approved by the Board of Directors and published annually on the website of the company www.tipspa.it, in the "Corporate Governance" section.
For the Board of Directors The Chairman Giovanni Tamburi
Milan, March 14, 2017
Declaration of the Executive Officer for Financial Reporting as per Article 81-ter of Consob Regulation No. 11971 of May 14, 1999 and subsequent amendments and supplements.
of the administrative and accounting procedures for the compilation of the consolidated financial statements for the year ended December 31, 2016.
No significant aspects emerged concerning the above.
The Chief Executive Officer The Executive Officer
Milan, March 14, 2017
| Company | Registered office | share | number of | number of | % | share of | Book value | |
|---|---|---|---|---|---|---|---|---|
| capital | shares | shares held | held | net equity | in accounts | |||
| Associates | ||||||||
| Asset Italia S.p.A. (1) | Milan | |||||||
| via Pontaccio, 10 | Euro | 1.000.000 | 100.000.000 | 20.000.000 | 20,00 | 2.273.312 | 2.273.312 | |
| Be Think, Solve, Execute S.p.A. | Rome | |||||||
| viale dell'Esperanto, 71 | Euro | 27.109.165 | 134.897.272 | 31.582.225 | 23,41 | 0 | 16.775.474 | |
| Clubitaly S.r.l. (1) | Milan | |||||||
| via Pontaccio, 10 | Euro | 100.000 | 100.000 | 27.500 | 27,50 | 33.766.907 | 33.766.907 | |
| Clubtre S.p.A. (2) | Milan | |||||||
| via Pontaccio, 10 | Euro | 120.000 | 120.000 | 42.000 | 43,28 | 102.667.452 | 102.693.420 | |
| Gatti & Co. GmbH (3) | Frankfurt am Main | |||||||
| Bockenheimer Landstr. 51-53 | Euro | 35.700 | 35.700 | 10.700 | 29,97 | 89.937 | 254.736 | |
| Gruppo IPG Holding S.p.A. (3) | Milan | |||||||
| via Appiani, 12 | Euro | 142.438 | 284.875 | 67.348 | 33,72 | 70.226.284 | 59.075.969 | |
| Palazzari & Turries Limited (4) | Hong Kong | |||||||
| 88 Queen's Road | Euro | 300.000 | 300.000 | 90.000 | 30,00 | 219.445 | 385.808 | |
| Tip-Pre Ipo S.p.A. (1) | Milan | |||||||
| via Pontaccio, 10 | Euro | 244.285 | 2.442.845 | 697.956 | 28,57 | 19.918.208 | 19.938.969 |
(1) Value relating to the updated net equity at 31.12.2016.
(2) Value relating to the updated net equity at al 30.6.2015.
(3) Value relating to the updated net equity at 31.12.2015.
(4) Share capital i n Hong Kong Dollars. Value relating to the updated net equity at 31.12.2015. The net equity was converted at the ERU/HKD rate o f 0,1185 (relating to 31.12.2015).
| Balance at 31.12.2015 | increases | decreases | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| in Euro | No. of | historic | fair value | increases write-downs | book value acquisition or | reclass. | fair value | decreases | fair value | reversal | write-downs book value | |||
| shares | cost | adjustments (decreases) | P&L | fair value subscription | increase | decreases | fair value | P&L | 31.12.2016 | |||||
| Non-listed companies | ||||||||||||||
| Azimut Benetti S.p.A. | 737,725 | 38,990,000 | 38,990,000 | 38,990,000 | ||||||||||
| Furn Invest S.a.S | 37,857,773 | 29,501,026 | 3,509,301 | 33,010,327 | 1,215,673 | 34,226,000 | ||||||||
| Ruffini Partecipazioni S.r.l. | 1,400 | 122,803,490 | 44,202,510 | 167,006,000 | 33,806,410 (122,803,490) | (78,008,920) | 0 | |||||||
| Talent Garden S.p.A. | 6,250 | 500,000 | 500,000 | |||||||||||
| Other equity instruments and other minor | 1,759,872 | 0 | 63,081 | (794,832) | 1,028,121 | 100,001 | (87,081) | (100,000) | 941,041 | |||||
| Total non-listed companies | 154,064,388 | 47,711,811 | 39,053,081 | (794,832) | 240,034,448 | 600,001 | 0 35,022,083 (122,890,571) | 0 (78,008,920) | (100,000) | 74,657,041 | ||||
| Listed companies | ||||||||||||||
| Amplifon S.p.A. | 9,538,036 | 34,884,370 | 41,372,228 | 76,256,598 | 10,062,628 | 86,319,226 | ||||||||
| Bolzoni S.p.A | 3,107,794 | 5,442,159 | 5,139,652 | 3,045,421 | (1,450,895) | 12,176,337 | 1,187,166 | (7,036,685) | (6,326,818) | 0 | ||||
| Digital Magics S.p.A. | 892,930 | 375,000 | 207,639 | 4,531,009 | 5,113,648 | 19,182 | (1,666,476) | 3,466,354 | ||||||
| Ferrari N.V. USD | 304,738 | (2,333,541) | 17,764,789 | 15,431,248 | 8,402,252 | 4,616,803 (11,493,193) | (148,963) | 16,808,147 | ||||||
| Ferrari N.V. euro | 174,000 | 0 | 7,558,560 | 0 | (7,558,560) | (76,276) | 76,276 | 0 | ||||||
| Fiat Chrysler Automobiles N.V. USD | 2,076,925 | 0 | 17,656,453 | 312,958 | 17,969,411 | |||||||||
| Fiat Chrysler Automobiles N.V. | 1,740,000 | 14,846,550 | (1,720,017) | 1,778,655 | 14,905,188 | 171,912 | 15,077,100 | |||||||
| Hugo Boss AG | 901,000 | (16,562,390) | 62,522,390 | 45,960,000 | 15,159,593 | (8,744,463) | 52,375,130 | |||||||
| M&C S.p.A. | 12,562,115 | 1,886,201 | 0 | (195,340) | 1,690,861 | 428,368 | (28,893) | 2,090,336 | ||||||
| Moncler S.p.A. | 5,898,354 | 200,792,410 | 5,131,567 (108,424,187) | (2,955,234) | 2,955,234 | 97,499,791 | ||||||||
| Monrif S.p.A | 12,658,232 | 11,374,782 | (135,831) | 0 | (7,895,912) | 3,343,039 | 220,253 | 135,831 | (1,309,249) | 2,389,874 | ||||
| Noemalife S.p.A | 1,248,505 | 5,265,970 | 3,130,226 | 0 | 8,396,196 | 873,356 | (5,265,970) | (4,003,582) | 0 | |||||
| Servizi Italia S.p.A. | 548,432 | 2,938,289 | 387,318 | 0 | (1,241,564) | 2,084,042 | 0 | 0 | (121,751) | 0 | 0 | 1,962,291 | ||
| Other listed companies | 2,914,466 | (791,370) | 1,898,798 | 0 | 4,021,894 | 182,770 | 186,650 | (69,548) | 0 | 32,571 | (701,995) | 3,652,341 | ||
| Total listed companies | 79,927,787 | 28,693,914 | 91,541,062 (10,783,711) | 189,379,051 | 249,771,220 | 0 23,191,660 (139,848,143) (13,564,200) | (7,279,451) | (2,040,137) | 299,610,001 | |||||
| Total investments | 233,992,175 | 76,405,725 | 130,594,143 (11,578,543) | 429,413,499 | 250,371,221 | 0 58,213,743 (262,738,714) (13,564,200) (85,288,371) | (2,140,137) 374,267,042 |
| Attachment 3 - Changes in investments measured under the equity method |
||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Balance at 01.01.2016 | decreases | Book value | ||||||||||||||
| in Euro | No. of | historic | write- revaluations | share of shareholder decreases | increase Book value | share of results increases | (decreases) (write-downs) at 31.12.2016 | |||||||||
| shares | cost | backs(write-downs) results as per loan capital | o | r (decrease) in accounts Purchases | Reclass. | as per (decreases) or restitutions | revaluations | |||||||||
| equity method | advance restitutions | fair value | equity method fair value | |||||||||||||
| Asset Italia S.p.A. | 2,400,000 | (126,688) | 2,273,312 | |||||||||||||
| Be Think, Solve, Execute S.p.A. | 31,582,225 | 16,596,460 | 217,239 | (53,070) | (86,700) | 16,673,929 | 737,195 | (284,456) | (351,194) | 16,775,474 | ||||||
| Clubitaly S.p.A. | 27,500 | 33,000,000 | (181,956) | (116,549) | 1,040,145 | 33,741,640 | 23,421 | 1,846 | 33,766,907 | |||||||
| Clubtre S.p.A. | 42,000 | 17,500 | 5,260,038 | 41,948,846 (7,934,801) | 35,587,747 | 74,879,330 | 1,471,760 27,658,059 | (1,341,697) | 102,667,452 | |||||||
| Gatti & Co Gmbh | 10,700 | 275,000 | (19,131) | (11,651) | 244,218 | 10,518 | 254,736 | |||||||||
| Gruppo IPG Holding S.p.A. | 67,348 | 39,847,870 | 5,010,117 | (7,597,729) | 18,939,309 | (1,022,501) | (9,682,990) | 45,494,076 | 6,365,753 | 8,666,045 | (1,449,905) | 59,075,969 | ||||
| Palazzari & Turries Limited | 90,000 | 225,000 | 65,349 | 108,115 | 398,464 | (12,657) | 385,807 | |||||||||
| Tip-Pre Ipo S.p.A. | 342,856 | 8,000,000 | 377,369 | 5,689,570 | 14,066,939 | 8,285,667 | 2,139,974 (3,704,493) | (428,517) | 20,359,570 | |||||||
| Totale | 97,961,830 | 5,010,117 (7,733,467) | 24,773,870 | 41,948,846 (9,010,372) | 32,547,772 185,498,596 | 10,685,667 | 0 | 10,609,276 32,337,001 | (3,571,313) | 0 235,559,227 |
(1) The change in the fair value refers to the change in the fair value of the investment in Prysmian S.p.A.
In accordance with Article 149 duodecies of the Consob Issuer's Regulations the information in relation to the fees paid to the audit firm PricewaterhouseCoopers S.p.A. and to its related network is reported in the table below:
The amounts reported in the table, relating to the year 2016, are those contractually agreed, including any inflation rises (not including travel, contributions and V.A.T.). In accordance with the regulation, fees paid to any secondary auditors or their respective networks are not included.
| Type of service | Service provider | Recipient of service | Fees (Euro) |
|---|---|---|---|
| Separate Financial statement |
44.000 | ||
| Consolidated Financial statement |
Tamburi Investment | 5.000 | |
| Limited audit procedures on the half |
PWC S.p.A. | Partners S.p.A. | |
| year Financial Statements | 16.000 | ||
| TOTAL TIP | 65.000 | ||
| Audit appointments in |
|||
| subsidiaries/associates | PWC S.p.A. | 37.083 | |
| TOTAL | 102.083 |
The amounts above do not include expenses and Consob contributions.
2016 Separate financial statements of tamburi investment partners s.p.a.
| (in Euro) | 2016 | 2015 | Note |
|---|---|---|---|
| Revenue from sales and services | 12,246,785 | 4,017,113 | 4 |
| Other revenue | 207,423 | 153,969 | |
| Total revenue | 12,454,208 | 4,171,082 | |
| Purchases, service and other costs | (1,910,253) | (2,133,370) | 5 |
| Personnel expenses | (24,676,991) | (6,781,822) | 6 |
| Amortisation, depreciation & write-downs | (59,579) | (44,658) | |
| Operating Loss | (14,192,615) | (4,788,768) | |
| Financial income | 73,587,621 | 30,631,909 | 7 |
| Financial charges | (16,626,509) | (9,123,128) | 7 |
| Profit before adjustments to investments | 42,768,497 | 16,720,013 | |
| Adjustments to available-for-sale financial assets | (2,140,137) | (288,653) | 8 |
| Profit before taxes | 40,628,360 | 16,431,360 | |
| Current and deferred taxes | 443,838 | (1,641,099) | 9 |
Profit 41,072,198 14,790,261
| (in Euro) | 2016 | 2015 | Note |
|---|---|---|---|
| Income and charges recorded directly to equity | |||
| Income through P&L | 23 | ||
| Increase/decrease in non-current AFS financial assets | 3,080,978 | 1,302,592 | |
| Unrealised profit/(loss) | 4,546,137 | 816,239 | |
| Tax effect | (1,465,159) | 486,353 | |
| Increase/decrease AFS current financial assets | (183,238) | (606,932) | |
| Unrealised profit/(loss) | (281,338) | (808,551) | |
| Tax effect | 98,100 | 201,619 | |
| Income not through P&L | |||
| Employee benefits | (20,087) | 7,811 | |
| Total income and charges recorded directly to equity | 2,877,653 | 703,471 | |
| Profit | 41,072,198 | 14,790,261 | |
| Total financial income and charges | 43,949,851 | 15,493,732 |
| (in Euro) December 31, 2016 2015 Non-current assets Property, plant and equipment 170,589 114,094 Goodwill 9,806,574 9,806,574 Other intangible assets 4,626 1,310 |
Note 10 11 11 12 13 14 |
|---|---|
| Investments in subsidiaries 15,014,445 66,776,965 |
|
| Investments in associates 141,323,803 133,429,737 |
|
| AFS financial assets 340,041,042 229,397,172 |
|
| Financial receivables 33,751,593 8,218,972 |
15 |
| Tax receivables 136,116 293,787 |
16 |
| Deferred tax assets 2,128,830 696,141 |
17 |
| Total non-current assets 542,377,618 448,734,752 |
|
| Current assets | |
| Trade receivables 999,322 2,622,069 |
18 |
| Current financial receivables 472,338 0 |
15 |
| Current financial assets 182,701 26,946,127 |
19 |
| AFS financial assets 0 21,613,809 |
20 |
| Cash and cash equivalents 1,195,650 1,088,569 |
21 |
| Tax receivables 309,290 340,590 |
16 |
| Other current assets 272,735 728,512 |
|
| Total current assets 3,432,036 53,339,676 |
|
| Total Assets 545,809,654 502,074,428 |
|
| Equity | |
| Share capital 76,855,733 76,853,713 |
22 |
| Reserves 172,743,518 166,692,110 |
23 |
| Retained earnings 33,443,468 28,048,695 |
|
| Profit 41,072,198 14,790,261 |
|
| Total equity 324,114,917 286,384,779 |
|
| Non-current liabilities | |
| Post-employment benefits 271,667 226,451 |
24 |
| Financial payables 133,752,298 138,594,609 |
25 |
| Deferred tax liabilities 2,502,556 1,135,497 |
16 |
| Total non-current liabilities 136,526,521 139,956,557 |
|
| Current liabilities | |
| Trade payables 540,611 301,639 |
|
| Current financial liabilities 67,380,277 67,104,385 |
26 |
| Tax payables 429,039 1,792,375 |
27 |
| Other liabilities 16,818,289 6,534,693 |
28 |
| Total current liabilities 85,168,216 75,733,092 |
|
| Total liabilities 221,694,737 215,689,649 |
|
| Total equity and liabilities 545,809,654 502,074,428 |
(in Euro)
| Share | Share | Legal Extraordinary | Revaluation | Treasury Other | IFRS | Merger | Retained | Result | Net Equity | |||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| capital | premium | reserve | reserve | reserve | shares reserves | reserve | surplus | earnings for the period | ||||
| reserve | AFS Financial | reserve | business | |||||||||
| assets | combination | |||||||||||
| At January 1, 2015 separate | 74,609,847 102,656,331 14,148,939 | 0 | 27,153,060 (13,606,493) 107,165 | (483,655) | 5,060,152 | 21,361,767 | 15,768,195 246,775,308 | |||||
| Change in fair value of financial assets | ||||||||||||
| available-for-sale | 1,302,592 | 1,302,592 | ||||||||||
| Change in fair value of current financial assets | (606,932) | (606,932) | ||||||||||
| Employee benefits | 7,811 | 7,811 | ||||||||||
| Total income and charges recorded directly to equity | 695,660 | 703,471 | ||||||||||
| Profit (loss) 2015 | 14,790,261 14,790,261 | |||||||||||
| Total statement of comprehensive income | 695,660 | 14,790,261 | 15,493,732 | |||||||||
| Transfer to equity revaluation reserve | 0 | |||||||||||
| Allocation profit 2014 | 773,030 | 6,686,928 | (7,459,958) | 0 | ||||||||
| Distribution of dividends | (8,308,237) (8,308,237) | |||||||||||
| Warrant conversion | 2,243,866 | 6,386,388 | 8,630,254 | |||||||||
| Sale of treasury shares | 12,030,610 | 17,668,403 | 29,699,013 | |||||||||
| Acquisition of treasury shares | (5,905,291) | (5,905,291) | ||||||||||
| At December 31, 2015 separate | 76,853,713 121,073,329 14,921,969 | 0 | 27,848,720 (1,843,381) 114,976 | (483,655) | 5,060,152 | 28,048,695 | 14,790,261 286,384,779 | |||||
| At January 1, 2016 separate | 76,853,713 121,073,329 14,921,969 | 0 | 27,848,720 (1,843,381) 114,976 | (483,655) | 5,060,152 | 28,048,695 | 14,790,261 286,384,779 | |||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Change in fair value of financial assets | ||||||||||||
| available-for-sale | 3,080,978 | 3,080,978 | ||||||||||
| Change in fair value of current financial assets | (183,238) | (183,238) | ||||||||||
| Employee benefits | (20,087) | (20,087) | ||||||||||
| Total income and charges recorded directly to equity | 2,897,740 | (20,087) | 2,877,653 | |||||||||
| Profit (loss) 2016 | 41,072,198 41,072,198 | |||||||||||
| Total statement of comprehensive income | 2,897,740 | (20,087) | 41,072,198 | 43,949,851 | ||||||||
| Allocation profit 2015 | 448,774 | 5,394,773 | (5,843,547) | 0 | ||||||||
| Distribution of dividends | (8,946,714) (8,946,714) | |||||||||||
| Warrant conversion | 2,020 | 12,704 | 14,724 | |||||||||
| Stock option plan effect | 5,722,750 | 5,722,750 | ||||||||||
| Acquisition of treasury shares | (3,010,473) | (3,010,473) | ||||||||||
| At December 31, 2016 separate | 76,855,733 121,086,033 15,370,743 | 0 | 30,746,460 (4,853,854) 5,817,639 | (483,655) | 5,060,152 | 33,443,468 | 41,072,198 324,114,917 |
| euro thousands | 2016 | 2015 | |
|---|---|---|---|
| A.- | OPENING NET CASH AND CASH EQUIVALENTS | (42,624) | (19,644) |
| B.- | CASH FLOW FROM OPERATING ACTIVITIES | ||
| Profit | 41,072 | 14,790 | |
| Amortisation & Depreciation | 54 | 31 | |
| Write-downs/(revaluation) of investments | 2,140 | 289 | |
| Write-downs/(revaluation) of current financial assets (doubtful debts) |
5 | 13 | |
| Financial income and charges | (57,496) | (16,236) | |
| Changes in "employee benefits" | 46 | 16 | |
| Stock option charges | 5,722 | ||
| Charges on bonds | 6,763 | 3,334 | |
| Change in deferred tax assets and liabilities | (1,433) | (524) | |
| (3,127) | 1,713 | ||
| Decrease/(increase) in trade receivables | 1,624 | (2,055) | |
| Decrease/(increases) in other current assets | 456 | (350) | |
| Decrease/(increase) in tax receivables | 189 | (323) | |
| Decrease/(increase) in financial receivables | (9,540) | (4,345) | |
| Decrease/(increase) in other current asset securities | 21,614 | 60,476 | |
| (Decrease)/increase in trade payables | 239 | (99) | |
| (Decrease)/increase in financial payables | (4,584) | 17,430 | |
| (Decrease)/increase of tax payables | (1,363) | 1,334 | |
| (Decrease)/increase in other current liabilities | 10,283 | (2,378) | |
| Cash flow from operating activities | 15,791 | 71,403 |
| 45,874 | |
|---|---|
| (131,817) | (160,848) |
| (108) | (76) |
| 135,180 |
| euro thousands | 2016 | 2015 |
|---|---|---|
| CASH FLOW FROM | ||
| FINANCING ACTIVITES | ||
| Loans | ||
| New loans | 39,830 | 0 |
| Repayment of loans | (39,944) | 0 |
| Borrowing costs on loans | (6,408) | (3,334) |
| Share capital | ||
| Share capital increase and capital contributions on account | 14 | 38,329 |
| Reduction for treasury share purchases | (3,007) | (5,905) |
| Payment of dividends | (8,947) | (8,308) |
| Change in reserves | 0 | (116) |
| Cash flow from financing activities | (18,462) | 20,666 |
| NET CASH FLOW FOR THE YEAR | 584 | (22,980) |
| CLOSING CASH AND CASH EQUIVALENTS | (42,040) | (42,624) |
| The breakdown of the net available liquidity was as follows: | ||
| Cash and cash equivalents | 1,196 | 1,089 |
| Bank payables due within one year | (43,236) | (43,713) |
| Closing cash and cash equivalents | (42,040) | (42,624) |
TIP is an independent investment/merchant bank focused on Italian medium-sized companies, with a particular involvement in:
The company was incorporated in Italy as a limited liability company and with registered office in Italy.
The company was listed in November 2005 and on December 20, 2010 Borsa Italiana S.p.A. assigned the STAR classification to TIP S.p.A. ordinary shares.
The present financial statements at December 31, 2016 were prepared in accordance with IFRS as separate financial statements as presented together with the consolidated financial statements at the same date. These financial statements were approved by the Board of Directors on March 14, 2017, who authorised their publication.
The financial statements at December 31, 2016 were prepared in accordance with the goingconcern concept and in accordance with International Financial Reporting Standards and International Accounting Standards (hereafter "IFRS", "IAS" or international accounting standards) issued by the International Accounting Standards Boards (IASB) and the relative interpretations of the International Financial Reporting Interpretations Committee (IFRIC), and adopted by the European Commission with Regulation No. 1725/2003 and subsequent modifications, in accordance with Regulation No. 1606/2002 of the European Parliament.
The financial statements in accordance with IAS1 are comprised of the income statement, the statement of comprehensive income, the statement of financial position, the change in shareholders' equity, the statement of cash flows and the explanatory notes, together with the Directors' Report. The financial statements were prepared in units of Euro, without decimal amounts.
The accounting policies and methods utilised for the preparation of these separate financial statements, for which reference should be made to the consolidated financial statements except for that indicated below, have not changed from those utilised for the preparation of the financial statements for the year ended December 31, 2015, except as outlined in the paragraph "new accounting standards" for which reference should be made to the Explanatory Notes in the consolidated financial statements. The investments in subsidiaries and associates are measured under the adjusted cost method.
The periodic test of the Investments, required by IAS 36, is made in the presence of an "Impairment indicator" which may consider that the assets have incurred a loss in value.
Associated companies are companies in which the Group exercises a significant influence on the financial and operating policies, although not having control. Significant influence is presumed when between 20% and 50% of voting rights is held in another entity.
The separate financial statements include, for comparative purposes, the figures of the previous year.
The presentation and disclosure relating to financial instruments are based on the provisions of IAS 32, as amended and integrated by IFRS 7.
During the year, no special circumstances arose requiring recourse to the exceptions allowed under IAS 1.
The separate financial statements at December 31, 2016 were prepared in accordance with the general cost criterion, with the exception of derivative financial instruments and current financial assets and AFS financial assets measured at fair value.
The preparation of the separate financial statements at December 31, 2016 requires the formulation of valuations, estimates and assumptions which impact the application of the accounting principles and the amounts of the assets, liabilities, costs and revenues recorded in the financial statements. These estimates and relative assumptions are based on historical experience and other factors considered reasonable. However, it should be noted as these refer to estimates, the results obtained will not necessarily be the same as those represented. The estimates are used to value the provisions for risks on receivables, measurement at fair value of financial instruments, impairment tests, employee benefits and income taxes.
The accounting principles utilised in the preparation of the financial statements and the composition and changes in the individual accounts are illustrated below.
The choices adopted relating to the presentation of the financial statements is illustrated below:
statement of changes in shareholders' equity, prepared in accordance with IAS 1;
cash flow statement: in accordance with IAS 7 the cash flow statement reports cash flows during the period classified by operating, investing and financing activities, based on the indirect method.
The company undertakes investment banking and merchant banking activities. Top management activity in the above-mentioned areas, both at marketing contact level and institutional initiatives and direct involvement in the various deals, is highly integrated. In addition, execution activity is also organised with the objective to render the "on-call" commitment of advisory or equity professional staff more flexible.
In relation to this choice it is almost impossible to provide a clear representation of the separate financial economic impact of the different areas of activity, as the breakdown of the personnel costs of top management and other employees on the basis of a series of estimates related to parameters which could be subsequently superseded by the actual operational activities would result in an extremely high distortion of the level of profitability of the segments of activity.
In the present financial statements only details on the performance of the "revenues from sales and services" component is provided, related to the sole activity of advisory, excluding therefore the account "other revenues".
| Euro | 2016 | 2015 |
|---|---|---|
| Revenue from sales and services | 12,246,785 | 4,017,113 |
| Total | 12,246,785 | 4,017,113 |
The significant increase in revenues is due to the excellent performance of the normal activities of advisory and the fees related to the start-up of Asset Italia S.p.A.
| The account comprises: | ||
|---|---|---|
| Euro | 2016 | 2015 |
| 1. Services |
1,385,809 | 1,585,468 |
| 2. Rent, leasing and similar costs |
354,767 | 366,480 |
| 3. Other charges |
169,677 | 181,422 |
| Total | 1,910,253 | 2,133,370 |
Service costs mainly relate to professional and legal consultancy, general expenses and commercial expenses. They include Euro 65,000 of audit fees and Euro 64,250 emoluments paid to the Board of Statutory Auditors and the Supervisory Board.
Other charges principally include non-deductible VAT.
| The account comprises: | ||
|---|---|---|
| Euro | 2016 | 2015 |
| Wages and salaries | 1,443,117 | 1,139,333 |
| Social security expenses | 394,458 | 302,161 |
| Directors' fees | 17,054,014 | 5,285,103 |
| Stock option charges | 5,722,750 | 0 |
| Post-employment benefits | 62,652 | 55,225 |
| Total | 24,676,991 | 6,781,822 |
The account "Wages and salaries" and "Directors' fees" includes fixed and variable remuneration matured in the period. The higher revenues and the 2016 pre-tax result resulted in an increase in the variable remuneration compared to 2015.
The cost includes, in addition, Euro 5,722,750 of charges relating to the assignment of 3,500,000 options under the "2014-2021 TIP Incentive Plan".
In line with IFRS 2, the options allocated were measured according to the equity settlement method. The fair value of the option was measured utilising the applicable valuation method for the given circumstances (in this case the Black & Scholes method), taking into account the terms and conditions by which the rights were allocated.
The assumptions utilised for the application of the model at the assignment date, or rather September 30, 2016 and December 30, 2016 are as follows:
| TIP share price at September 30, 2016 | 3.594 |
|---|---|
| Exercise price of the Options | 1.995 |
| First day for the exercise of the options | Jan 1, 17 |
| Last day for the exercise of the options | Dec 31, 21 |
| Historic average volatility of the STAR index (360 days) | 19.79% |
| Riskless Rate (Italian Bond 2021) | 0.274% |
| Number of options originally outstanding | 2,500,000 |
| Number of options outstanding at the date | 2,500,000 |
| Number of shares per option | 1.00 |
| Number of options exercised at the date | 0 |
| Number of TIP shares issued at September 30, 2016 | 147,799,487 |
| TIP share price at December 31, 2016 | 3.600 |
| Exercise price of the Options | 1.995 |
| First day for the exercise of the options | Jan 1, 17 |
| Last day for the exercise of the options | Dec 31, 21 |
| Historic average volatility of the STAR index (360 days) | 18.71% |
| Riskless Rate (Italian Bond 2021) | 0.596% |
| Number of options originally outstanding | 2,500,000 |
| Number of options outstanding at the date | 3,500,000 |
| Number of shares per option | 1.00 |
| Number of options exercised at the date | 0 |
| Number of TIP shares issued at December 31, 2016 | 147,799,487 |
"Post-employments benefits" are updated based on actuarial valuations, with the gains or losses recognised through equity.
| December 31, 2016 | December 31, 2015 | |
|---|---|---|
| White collar & apprentices | 11 | 10 |
| Managers | 1 | 1 |
| Executives | 4 | 3 |
| Total | 16 | 14 |
At December 31, 2016, the number of TIP employees was as follows:
The Chairman/CEO and Vice Chairman/CEO are not employees either of TIP or of Group companies.
| The account comprises: | ||
|---|---|---|
| Euro | 2016 | 2015 |
| 1. Investment income |
69,995,010 | 19,167,134 |
| 2. Income from securities recorded in current assets |
2,311,318 | 10,939,394 |
| Other income | 1,281,293 | 525,381 |
| Total financial income | 73,587,621 | 30,631,909 |
| 4. Interest and other financial charges |
(16,626,509) | (9,123,128) |
| Total financial charges | (16,626,509) | (9,123,128) |
| Net financial income | 56,961,112 | 21,508,781 |
| (7).1. Investment income | ||
| Euro | 2016 | 2015 |
| Gains on liquidation of investments | 39,073,771 | 899,578 |
| Gain on Ferrari N.V. share | 15,960,812 | 0 |
| Gain on disposal of investments | 10,601,386 | 15,336,870 |
| Dividends | 4,359,041 | 2,930,686 |
| Total | 69,995,010 | 19,167,134 |
The gains from the liquidation of investments relates to the gains realised on the liquidation on Clubsette S.r.l..
In particular, the gain represents the difference between the carrying amount of the investment held and the value of the Moncler shares and of the liquidity received by TIP from the liquidation of the company. This liquidation follows the withdrawal from Ruffini Partecipazioni S.r.l. exercised by Clubsette S.r.l. in which Clubsette S.r.l. received the Moncler S.p.A. shares previously held by Ruffini Partecipazioni. Clubsette S.r.l. was then placed in liquidation and the Moncler shares were assigned to the shareholders. The closure of the liquidation was on December 29, 2016.
Following the spin-off of Ferrari from FCA on January 4, 2016, TIP received 174,000 Ferrari shares based on the FCA shares held at December 31, 2015 and 193,422 FCA convertible securities. These transactions, in accordance with IFRS, were recorded for accounting purposes as a dividend distribution and therefore generated a gain in the income statement of approximately Euro 16 million, equal to the market value of the Ferrari shares communicated by the Stock Exchange on January 4, 2016. On the other hand, the decrease in the value of the convertible loan following the distribution of the Ferrari shares and the consequent performance of the FCA securities resulted in a significant initial charge. During the year, this charge reduced significantly to approximately Euro 9 million. At the conversion date in FCA shares, on December 15, 2016, the charge for the year was approximately Euro 9 million. The net effect of the approximately Euro 16 million gain and the charge of approximately Euro 9 million above was therefore a net gain of approximately Euro 7 million booked to the income statement in 2016, in addition to interest matured on the convertible bond of approximately Euro 1.9 million.
For the statement of financial position, the above operations resulted in an initial significant decrease in the fair value reserve attributable to FCA which at year end reduced to approximately Euro 1.5 million.
The recovery in the FCA and Ferrari share prices continued into 2017 and the fair value of these investments is today above their initial recognition value, including for the FCA shares received from the conversion.
In 2016, the gains relate to the sale of the following investments (Euro):
| Bolzoni S.p.A. | 6,326,818 |
|---|---|
| Noemalife S.p.A. | 4,003,582 |
| Other | 270,986 |
| Total | 10,601,386 |
In 2016, TIP received dividends from the following shareholdings:
| Euro | |
|---|---|
| Hugo Boss AG | 2,534,000 |
| TIP - Pre Ipo S.p.A. | 428,516 |
| Amplifon S.p.A. | 410,132 |
| BE S.p.A. | 351,194 |
| Ferrari N.V. | 324,347 |
| Other | 310,852 |
| Total | 4,359,041 |
| Euro | 2016 | 2015 |
|---|---|---|
| Interest on securities in current assets | 1,998,102 | 3,407,676 |
| Unrealised gains on securities | 313,216 | 4,738,544 |
| Exchange differences on sale of securities | 0 | 386,347 |
| Interest on securities in current assets | 0 | 2,406,827 |
| Total | 2,311,318 | 10,939,394 |
| Euro | 2016 | December 31, 2015 |
|---|---|---|
| Unrealised losses on securities | 8,989,959 | 0 |
| Interest on bonds | 6,763,477 | 6,679,381 |
| Incentive plan costs (stock option) | 0 | 1,324,838 |
| Other | 873,073 | 1,118,909 |
| Total | 16,626,509 | 9,123,128 |
The unrealised losses on securities follows the application of IFRS to the performance of the investment in the FCA convertible loan, resulting in a loss also following the spin-off of the investment in Ferrari N.V. This impact should be, at least from an operational profile, considered jointly with the income of Euro 16 million outlined in Note 7.1.
"Interest on bonds" refers to that matured in favour of the partial convertible bond of Euro 40 million, as well as the 2014-2020 TIP Bond of Euro 100 million calculated in accordance with the amortised cost method applying the effective interest rate. The bond partially convertible was repaid in advance in December 2016 through the drawdown of a bank loan at more favourable conditions.
The incentive plan costs in 2015 included the changes in the fair value relating to the liability to directors and employees as the plan provided for a cash settlement. The new plan in 2016, which provides for an equity settlement except where otherwise resolved by the Board, does not result in any financial adjustment for charges already recorded under personnel costs.
The "Other" account includes bank interest, on loans, losses realised on securities and other financial charges.
| Euro | 2016 | 2015 |
|---|---|---|
| Write-down of AFS financial assets | (2,140,137) | (288,653) |
| Total | (2,140,137) | (288,653) |
The write-down in the period relates mainly to minor investments. Reference should be made to Attachment 2 of the present financial statements.
The breakdown of income taxes is as follows:
| Euro | 2016 | 2015 |
|---|---|---|
| Current income taxes | 988,848 | 1,476,687 |
| Deferred tax income | (1,432,686) | 164,412 |
| Total | (443,838) | 1,641,099 |
The reconciliation between the theoretical and actual tax charges is provided below:
| 2016 | 2015 | |||
|---|---|---|---|---|
| Euro | Amount | Tax | Amount | Tax |
| Profit before taxes | 40,628,360 | 16,431,360 | ||
| Theoretical tax charge | 27.50% | 11,172,799 | 27.50% | 4,518,624 |
| Permanent decreases | ||||
| Dividends | (4,141,089) | (1,138,799) | (2,784,152) | (765,642) |
| Exempt gains (*) | (46,968,752) | (12,916,407) | (10,969,729) | (3,016,675) |
| Tax losses | 76,276 | 20,976 | 53,155 | 14,618 |
| Other permanent decreases | (9,019,441) | (2,480,346) | (298,134) | (81,987) |
| (16,514,576) | (3,849,687) | |||
| Permanent increases | 8,671,073 | 2,384,545 | 171,300 | 47,108 |
| Temporary differences | ||||
| Differences which will reverse in future years | 8,759,006 | 2,408,727 | 6,324,401 | 1,739,210 |
| Reversal differences from previous years | (2,442,758) | (671,758) | (2,995,873) | (823,865) |
| Total temporary differences | 1,736,969 | 915,345 |
| 2016 | 2015 | |||
|---|---|---|---|---|
| Euro | Amount | Tax | Amount | Tax |
| ACE assessable | (85,796) | (23,593) | ||
| Losses carried forward | (1,469,968) | (404,242) | ||
| Total | (4,437,325) | 4,376,564 | 1,203,555 | |
| IRAP regional tax | 303,660 | 273,132 | ||
| Change in deferred tax assets/liabilities | (1,432,686) | 164,412 | ||
| Other changes | 685,188 | 0 | ||
| Total income taxes | (443,838) | 1,641,099 |
(*) The tax charge is principally due to the application of the PEX regime on the gains realised on the equity investments.
The company recognised directly to equity a net decrease in deferred tax liabilities amounting to Euro 1,367,059 in relation to the increase in the value of the financial assets available-for-sale.
The following table illustrates the changes in the account:
| Other | ||
|---|---|---|
| Euro | assets | Total |
| Net value at December 31, 2014 | 69,657 | 69,657 |
| Increases | 74,871 | 74,871 |
| Decreases | 0 | 0 |
| Decrease depreciation provision | 0 | 0 |
| Depreciation | (30,434) | (30,434) |
| Net value at December 31, 2015 | 114,094 | 114,094 |
| Increases | 107,940 | 107,940 |
| Decreases | (20,817) | 0 |
| Decrease depreciation provision | 20,817 | 0 |
| Depreciation | (51,445) | (51,445) |
| Net value at December 31, 2016 | 170,589 | 170,589 |
The increase in "Other Assets" mainly refers to the purchase of EDP, furniture and fittings, motor vehicles and mobile telephones.
"Goodwill" for Euro 9,806,574 refers to the incorporation of the subsidiary Tamburi & Associati S.p.A. into TIP S.p.A. in 2007.
In accordance with IAS 36 the value of goodwill, having an indefinite useful life, is not amortised, but subject to an impairment test, made at least annually.
The recoverable value is estimated based on the value in use, calculated using the following assumptions:
| Euro | Industrial patents and intellectual property rights |
Concessions, licences and trademarks |
Total |
|---|---|---|---|
| Net value at December 31, 2014 | 840 | 536 | 1,376 |
| Increases | 840 | - | 840 |
| Decreases | - | - | - |
| Amortisation | (700) | (206) | (906) |
| Net value at December 31, 2015 | 980 | 330 | 1,310 |
| Increases | 6,219 | - | 6,219 |
| Decreases | - | - | - |
| Amortisation | (2,773) | (130) | (2,903) |
| Net value at December 31, 2016 | 4,426 | 200 | 4,626 |
The following illustrates the changes in "Other intangible assets":
This relates to the investment in the subsidiaries TXR S.r.l. and Clubuno S.r.l.
The key data (in Euro) on the subsidiaries are as follows:
| Company | Registered Office |
Share capital | Number of shares |
Number of shares held |
% held |
|---|---|---|---|---|---|
| Clubuno S.r.l. | Milan | 10,000 | 10,000 | 10,000 | 100% |
| TXR S.r.l. | Milan | 100,000 | 100,000 | 51,000 | 51.0% |
TXR S.r.l. holds 38.336% in Furn-Invest S.A., a French registered simplified joint stock company which in turn controls Roche Bobois.
Clubuno S.r.l. does not hold any investments.
Compared to the previous year Clubsette S.r.l. is no longer a subsidiary, as after the withdrawal of the investment in Ruffini Partecipazioni following which it received the shares of Moncler S.p.A., the company was placed in liquidation. The liquidation process, which saw the distribution of the Moncler shares, was concluded on December 29, 2016.
| Company | registered | share capital | shares | holding | % |
|---|---|---|---|---|---|
| office | holding | ||||
| Clubtre S.p.A. | Milan | 120,000 | 120,000 | 42,000 | 35.00 |
| Clubitaly S.p.A. | Milan | 100,000 | 100,000 | 27,500 | 27.50 |
| Gruppo IPG Holding S.p.A | Milan | 142,437.50 | 248,875.50 | 67,348 | 23.64 |
| TIP-pre IPO S.p.A. – TIPO | Milan | 120,000 | 1,200,000 | 342,856 | 28.57 |
| BE S.p.A. | Rome | 27,109,165 | 134,897,272 | 31,582,225 | 23.41 |
| Palazzari & Turries Limited | Hong Kong | 300,000 (1) | 300,000 | 90,000 | 30.00 |
| Gatti & Co. Gmbh | Frankfurt | 35,700 | 35,700 | 10,700 | 29.97 |
(1) In Hong Kong Dollars.
The investments in associates refer to:
For the changes in the investments in associates, reference should be made to attachment 4.
The financial assets refer to minority investments in listed and non-listed companies.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Investments in listed companies | 299,610,001 | 189,379,051 |
| Investments in non-listed companies | 40,431,041 | 40,018,121 |
| Total | 340,041,042 | 229,397,172 |
For the changes in the "AFS financial assets" during the year, reference should be made to attachment 2.
In relation to the effects of the measurement of investments in listed companies reference should be made to note (8) and note (23).
The Moncler operation had a substantial impact on movements in the year as resulting in the allocation to Clubsette S.r.l. in liquidation of Moncler shares following the withdrawal from Ruffini Partecipazioni and subsequently the allocation by Clubsette S.r.l. to its shareholders, including TIP S.p.A., of its assets and in particular Moncler shares.
The main increases in the year, in addition to those relating to Moncler, relate to the Ferrari shares received following the previously mentioned spin-off and to the FCA shares received from the conversion of the FCA convertible bond.
The composition of the valuation methods of the non-current financial assets available for sale relating to investments in listed and non-listed companies is illustrated in the table below:
| Non-listed | ||
|---|---|---|
| Listed companies | companies | |
| Method | (% of total) | (% of total) |
| Listed prices on active markets (level 1) | 100.0% | 0.0% |
| Valuation models based on market inputs (level 2) | 0.0% | 96.44% |
| Other valuation techniques (level 3) | 0.0% | 0.0% |
| Purchase cost | 0.0% | 3.56% |
| Total | 100.0% | 100.0% |
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Non-current loans | 33,751,593 | 8,218,972 |
| Total | 33,751,593 | 8,218,972 |
The non-current loans recognised at amortised cost refer to:
The interest matured on loans which will be received within one year are classified in the account current financial receivables.
The breakdown is as follows:
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| IRES corp. tax receivables | 16,387 | 0 |
| IRAP regional tax receivables | 273,130 | 6,566 |
| VAT Receivables | 0 | 8,224 |
| Tax receivables for post-employment benefit revaluation | 0 | 0 |
| Withholding taxes | 19,773 | 325,800 |
| Total | 309,290 | 340,590 |
| Due beyond one year | ||
| Tax receivables – tax credit | 0 | 144,119 |
| Tax receivables – IRAP reimbursement | 136,116 | 13,736 |
| Tax receivables – IRAP reimbursement 2007-2011 | 0 | 135,932 |
| Total (beyond one year) | 136,116 | 293,787 |
The breakdown of the account at December 31, 2015 and December 31, 2016 is detailed below:
| Euro | Assets | Liabilities | Net | |||
|---|---|---|---|---|---|---|
| 31/12/2015 | 31/12/2016 | 31/12/2015 | 31/12/2016 | 31/12/2015 | 31/12/2016 | |
| Other intangible assets | 2,771 | 3,140 | 2,771 | 3,140 | ||
| Non-curr. AFS fin. assets and investees under equity method |
(1,028,428) | (2,493,587) | (1,028,428) | (2,493,587) | ||
| Current AFS financial assets | (98,100) | (98,100) | ||||
| Profit/(loss) | 27,151 | 23,760 | (8,969) | (8,969) | 18,182 | 14,791 |
| Other liabilities | 666,219 | 2,101,930 | 666,219 | 2,101,930 | ||
| Total | 696,141 | 2,128,830 | (1,135,497) | (2,502,556) | (439,356) | (373,726) |
The changes in the tax assets and liabilities were as follows:
| Euro | 31.12. 2015 | Recorded through P&L |
Recorded through Equity |
31.12.2016 |
|---|---|---|---|---|
| Other intangible assets | 2,771 | 369 | 3,140 | |
| Non-curr. AFS fin. assets and investees under equity method |
(1,028,428) | (1,465,159) | (2,493,587) | |
| Current AFS financial assets | (98,100) | 98,100 | ||
| Profit/(loss) | 18,182 | (3,391) | 14,791 | |
| Other liabilities | 666,219 | 1,435,711 | 2,101,930 | |
| Total | (439,356) | 1,432,689 | (1,367,059) | (373,726) |
| December 31, 2016 | December 31, 2015 |
|---|---|
| 1,167,131 | 2,784,648 |
| (167,809) | (162,579) |
| 999,322 | 2,622,069 |
| - | - |
| - | - |
Changes in trade receivables is strictly related to the different revenue mix between success fees and service revenues.
The doubtful debt provision amounts to Euro 167,809.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Bonds and other | 182,701 | 26,946,127 |
| Total | 182,701 | 26,946,127 |
At December 31, 2015, the account included the FCA converting bond loan, whose conversion into FCA shares took place on December 15, 2016.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Bond securities | 0 | 21,613,809 |
| Total | 0 | 21,613,809 |
The decrease in current AFS financial assets is essentially due to the utilisation of financial resources for investment activity in the year.
The account represents the balance of banks deposits determined by the nominal value of the current accounts with credit institutions.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Bank deposits | 1,188,906 | 1,083,680 |
| Cash in hand and similar | 6,744 | 4,889 |
| Total | 1,195,650 | 1,088,569 |
The composition of the net financial position at December 31, 2016 compared with the end of the previous year is illustrated in the table below.
| Euro | December 31, 2016 | December 31, 2015 | |
|---|---|---|---|
| A | Cash and cash equivalents | 1,195,650 | 1,088,569 |
| B | Current financial assets | 182,701 | 48,559,936 |
| C | Current financial receivables | 472,338 | 0 |
| D | Liquidity (A+B+C) | 1,850,689 | 49,648,505 |
| E | Financial payables | (133,752,298) | (138,594,609) |
| F | Current financial liabilities | (67,380,277) | (67,104,385) |
| G | Net Financial Position | (199,281,886) | (156,050,489) |
The net financial position increased following the utilisation of current assets to invest in equity holdings, including the conversion of the convertible bond into FCA shares.
Financial payables refer to the TIP 2014-2020 bond and the medium/long-term portion of bank loans.
The current financial liabilities principally refer to bank loans and interest related to the bond loan matured and still not paid.
| (22) Share capital | |
|---|---|
| The share capital of TIP S.p.A. is composed of: |
|
| Shares | Number |
| ordinary shares | 147,799,487 |
| Total | 147,799,487 |
The Shareholders' Meeting of July 14, 2016 approved the proposal to eliminate the nominal value of TIP S.p.A. shares.
On August 13, 2016, the first exercise period of the Tamburi Investment Partners S.p.A. 2015 - 2020 Warrants concluded, with the exercise of 3,885 warrants and a relative share capital increase of Euro 2,020.20 with the issue of 3,885 new ordinary TIP S.p.A. shares at a price of Euro 3.79 each, for a total value of Euro 14,724.15.
The share capital of TIP S.p.A. amounts therefore to Euro 76,855,733, represented by 147,799,487 ordinary shares.
The treasury shares in portfolio at December 31, 2016 totalled 1,478,370, equal to 1.00% of the share capital.
| No. treasury shares at | No. of shares acquired | No. of shares sold | No. treasury shares at |
|---|---|---|---|
| January 1, 2016 | in 2016 | 2016 | December 31, 2016 |
| 541,678 | 936,692 | - | 1,478,370 |
Analysis is provided below of the statutory and tax nature of the equity accounts.
| Nature/Description | Amount | Poss. of utilisation |
Quota available |
Utilisation in 3 previous years to cover losses |
Utilisation in 3 previous years for other reasons |
|---|---|---|---|---|---|
| Share capital | 76,855,733 | ||||
| Legal reserve | 15,370,743 | B | 15,370,743 | ||
| Share premium reserve | 121,086,033 | A,B | 121,086,033 | ||
| Valuation reserve AFS financial | 30,746,460 | ||||
| assets | |||||
| Other reserves | 5,817,639 | ||||
| Merger surplus | 5,060,152 | A,B,C | 5,060,152 | ||
| Retained earnings | 33,443,468 | A,B,C | 33,443,468 | ||
| IFRS business combination reserve | (483,655) | ||||
| Treasury shares acquisition reserve | (4,853,854) |
| Total | 283,042,719 | 174,960,396 |
|---|---|---|
| Non-distributable quota (*) | 121,086,033 |
A: for share capital increase, B: for coverage of losses and C: for distribution to shareholders.
* Concerns the share premium reserve (Euro 121,086,033) which, in accordance with Article 2431 of the Civil Code, may not be distributed until the legal reserve has reached the limits established by Article 2430 of the Civil Code (Euro 15,371,151).
The following additional disclosure is provided on the shareholders' equity at December 31, 2016.
These amount to Euro 15,370,743. After the conversion of 3,885 warrants into TIP ordinary shares, Euro 404 remains until reaching the limit established by Article 2430 Civil Code.
The share premium reserve amounts to Euro 121,086,033. The share premium reserve increased Euro 12,704 following the conversion of 3,885 warrants in TIP ordinary shares.
The positive reserve amounts to Euro 30,746,460. This is an unavailable reserve as referring to the change in the fair value compared to the acquisition value of the investments in portfolio and of the current financial assets.
The changes in the non-current AFS financial assets valuation reserve, which represents the total of income and charges recognised directly through equity, is illustrated in the table below:
| Euro | Book value at 1.1.2016 | Change | Book value at 31.12.2016 |
|---|---|---|---|
| Non-current AFS financial assets | 28,693,911 | 4,546,137 | 33,240,048 |
| Current AFS financial assets | 281,338 | (281,338) | - |
| Tax effect | (1,126,529) | (1,367,059) | (2,493,588) |
| Total reserve | 27,848,720 | 2,897,740 | 30,746,460 |
The table below illustrates the implicit gains of the investments and of the current financial assets between January 1, 2016 and December 31, 2016, net of the potential tax charge at the balance sheet date, which are recognised under equity in the account "Valuation reserve AFS financial assets".
For details of changes reference should be made to note 14 (Non-current AFS financial assets) and note 20 (Current AFS financial assets).
They amount to Euro 5,817,639 and refer for Euro 5,722,750 to the stock option plan reserve created following the allocation of options to employees and directors which will be settled through the equity settlement method, for Euro 9,545 to the negative employee benefit reserve and for Euro 104,434 to the reserve originally relating to the value of the options of the convertible bond which with the advance repayment without conversion became a free reserve.
The merger surplus amounts to Euro 5,060,152. This derives from the incorporation of Secontip S.p.A. in TIP on January 1, 2011.
Retained earnings amount to Euro 33,443,468 and increased compared to December 31, 2015 following the allocation of the 2015 profit.
The reserve was negative and amounts to Euro 483,655, unchanged compared to December 31, 2015.
The negative reserve amounts to Euro 4,853,854. This relates to a non-distributable reserve.
For the changes in the year and breakdown of other equity items reference should be made to the specific statement.
At December 31, 2016, the balance of the account related to the Post-Employment Benefit due to all employees of the company at the end of employment service.
The liability was updated based on actuarial calculations.
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Opening balance | 226,451 | 210,646 |
| Provisions in the period | 67,455 | 31,460 |
| Actuarial gains/losses | 20,087 | (7,811) |
| Transfers to pension funds and utilisations | (42,326) | (7,844) |
| Total | 271,667 | 226,451 |
Financial payables of Euro 133,752,298 refer to:
The bond provides for compliance with annual financial covenants.
In accordance with the application of international accounting standards required by Consob recommendation No. DEM 9017965 of February 6, 2009 and the Bank of Italy/Consob/Isvap No. 4 of March 4, 2010, we report that this account does not include any exposure related to covenants not complied with.
These amount to Euro 67,380,277 and principally comprise bank payables of Euro 64,032,820 and interest on bonds for Euro 3,347,457.
| The breakdown of the account is as follows: | ||
|---|---|---|
| Euro | December 31, 2016 | December 31, 2015 |
| IRAP | 303,660 | 0 |
| IRES | 0 | 1,200,390 |
| VAT | 10,554 | 0 |
| Withholding taxes | 114,825 | 591,985 |
| Total | 429,039 | 1,792,375 |
| The account mainly refers to emoluments for directors and employees. | ||
|---|---|---|
| Euro | December 31, 2016 | December 31, 2015 |
|---|---|---|
| Directors and employees | 16,534,243 | 4,739,721 |
| Directors and employees for stock options | 0 | 1,449,525 |
| Total | 16,818,289 | 6,534,693 |
|---|---|---|
| Others | 109,749 | 232,992 |
| Social security institutions | 174,297 | 112,455 |
The Company, by nature of its activities, is exposed to various types of financial risks; in particular, to the risk of changes in market prices of investments and, marginally, to the risk of interest rates.
The policies adopted by the company for the management of the financial risk are illustrated below.
The company is exposed to the interest rate risk relating to the value of the current financial assets represented by bonds.
The company, by nature of its activities, is exposed to the risk of changes in the value of the investments.
In relation to the listed investments at the present moment there is no efficient hedging instrument of a portfolio such as those with the characteristics of the company.
Relating to non-listed companies, the risks related:
(a) to the valuation of these investments, in consideration of: (i) absence in these companies of control systems similar to those required for listed companies, with the consequent unavailability of information at least equal to, under a quantitative and qualitative profile, of those available for this later; (ii) the difficulties to undertake independent verifications in the companies and, therefore to assess the completeness and accuracy of the information provided;
(b) the ability to impact upon the management of these investments and drive their growth, the pre-requisite for investment, based on the company's relationships with management and shareholders and, therefore, subject to verification and the development of these relationship;
(c) the liquidity of these investments, not negotiable on regulated markets; were not hedged through specific derivative instruments as not available. The company attempts
to minimise the risk – although within a merchant banking activity and therefore by definition risky – through a careful analysis of the companies and sectors on entry into the share capital, as well as through careful monitoring of the performance of the investee companies after entry in the share capital.
A sensitivity analysis is reported below which illustrates the effects resulting from, respectively on the income statement and on the balance sheet, of a hypothetical change in the fair value of the instruments held at December 31, 2016 of +/-5% compared to the comparative figures for 2015.
| Sensitivity Analysis | December 31, 2016 | December 31, 2015 | |||||
|---|---|---|---|---|---|---|---|
| thousands of Euro | -5.00% | Basic | +5.00% | -5.00% | Basic | +5.00% | |
| Investments in listed companies | 284,631 | 299,611 | 314,591 | 179,910 | 189,379 | 198,848 | |
| Investments in non-listed companies | 38,409 | 40,431 | 42,453 | 38,017 | 40,018 | 42,019 |
| Non-current AFS financial assets | 323,040 | 340,042 | 357,044 | 217,927 | 229,397 | 240,867 |
|---|---|---|---|---|---|---|
| Bonds and other debt securities | 173 | 182 | 191 | 25,599 | 26,946 | 28,293 |
| Current financial assets | 173 | 182 | 191 | 25,599 | 26,946 | 28,293 |
| Asset management | 0 | 0 | 0 | 0 | 0 | 0 |
| Bond securities | 0 | 0 | 0 | 20,533 | 21,614 | 22,695 |
| ETF | 0 | 0 | 0 | 0 | 0 | 0 |
| AFS financial assets | 0 | 0 | 0 | 20,533 | 21,614 | 22,695 |
| Effects on the result | (9) | 9 | (1,347) | - | 1,347 | |
| Effects on the revaluation reserve financial assets |
(17,002) | 17,002 | (12,551) | - | 12,551 |
The company's exposure to the credit risk depends on the specific characteristics of each client as well as the type of activities undertaken and in any case at the preparation date of the present financial statements is not considered significant.
Before undertaking an assignment, careful analysis is undertaken on the credit reliability of the client.
The company approach in the management of liquidity guarantees, where possible, that there are always sufficient funds to meet current obligations.
At December 31, 2016, the credit lines available and not utilised of the TIP Group amounted to Euro 19.8 million.
The capital management policies of the Board of Directors provide for maintaining high levels of own capital in order to maintain a relationship of trust with investors, allowing for future development.
The company acquired treasury shares on the market in a timely manner which depends on market prices.
The classification of financial instruments at fair value in accordance with IFRS 13 is determined based on the quality of the input sources used in the valuation, according to the following hierarchy:
In accordance with the disclosures required by IFRS 13, the types of financial instruments recorded in the financial statement at December 31, 2016 are illustrated below with indication of the accounting policies applied and, in the case of financial instruments measured at fair value, of the exposure to changes in fair value (income statement or equity), specifying also the hierarchical level of fair value attributed.
The final column of the following tables shows, where applicable, the fair value at the end of the period of the financial instrument.
| Accounting policies applied in accounts for financial instruments | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Type of instrument | fair value | |||||||||||
| with change in fair value recorded through: |
Total | Fair value hierarchy | Amortised | Invest. | Book value at |
fair value at 31.12.2016 |
||||||
| (in thousands of Euro) | net equity P&L |
fair value |
1 | 2 | 3 | cost | at cost | 31.12.2016 | ||||
| AFS financial assets of which - listed companies - non-listed companies Financial receivables |
1 | 340,042 299,611 40,431 |
340,042 299,611 40,431 |
299,611 | 38,990 | 34,224 | 1,441 | 340,042 299,611 40,431 34,224 |
340,042 299,611 40,431 34,224 |
|||
| Trade receivables Current financial assets |
1 | 182 | 182 | 999 | 999 182 |
999 182 |
||||||
| AFS financial assets Cash and cash equivalents Other current assets |
1 1 |
1,196 272 |
1,196 272 |
1,196 272 |
||||||||
| Non-current financial payables |
2 | 133,752 | 133,752 | 142,762 | ||||||||
| Trade payables Current financial liabilities Other liabilities |
1 1 1 |
541 67,380 16,818 |
541 67,380 16,818 |
541 67,380 16,818 |
Note
For these accounts the fair value was not calculated as their carrying value approximates this value.
The account includes the listed bond, for which a fair value was determined at December 31, 2016, while for the other accounts the fair value was not calculated as the recognition value approximates the fair value.
The following tables report the financial instruments of TIP directly and indirectly held at the end of the period, also through trust companies, communicated to the company by the members of the Board of Directors. The table also illustrates the financial instruments acquired, sold and held by the parties in 2016.
| Members of the Board of Directors | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Name | Office | No. of shares held at December 31, 2015 |
No. of shares acquired in 2016 |
No. of shares allocated from exercise of TIP warrant |
No. of shares sold in 2016 |
No. of shares held at December 31, 2016 |
|||||
| Giovanni Tamburi(1) | Chair. & CEO | 10,916,670 | 160,481 | 11,077,151 | |||||||
| Alessandra Gritti | Vice Chair. & CEO |
1,833,943 | 98,000 | 1,931,943 | |||||||
| Cesare d'Amico(2) | Vice Chairman | 18,250,624 | 250,000 | 18,500,624 | |||||||
| Claudio Berretti | Dir. & Gen. Manager |
1,436,864 | 10,000 | 1,446,864 | |||||||
| Alberto Capponi | Director | 0 | 0 | ||||||||
| Paolo d'Amico(3) | Director | 17,600,000 | 250,000 | 17,850,000 | |||||||
| Giuseppe Ferrero | Director | 2,765,815 | 155,183 | 2,920,998 | |||||||
| Manuela Mezzetti | Director | 59,702 | 59,702 | ||||||||
| Daniela Palestra | Director | 0 | 0 | ||||||||
| Name | Office | No. of warrants held at December 31, 2015 |
No. of warrants assigned in 2016 |
No. of warrants sold in 2016 |
No. of warrants exercised in 2016 |
No of warrants held at December 31, 2016 |
|||||
| Giovanni Tamburi(1) | Chair. & CEO | 2,559,167 | 2,559,167 | ||||||||
| Alessandra Gritti | Vice Chair. & CEO |
458,485 | 458,485 | ||||||||
| Cesare d'Amico(2) | Vice Chairman | 4,562,656 | 4,562,656 | ||||||||
| Claudio Berretti | Dir. & Gen. Manager |
311,716 | 311,716 | ||||||||
| Alberto Capponi | Director | 0 | 0 | ||||||||
| Paolo d'Amico(3) | Director | 4,400,000 | 4,400,000 | ||||||||
| Giuseppe Ferrero | Director | 691,453 | 691,453 | ||||||||
| Manuela Mezzetti | Director | 14,925 | 14,925 | ||||||||
| Daniela Palestra | Director | 0 | 0 |
(1)Giovanni Tamburi holds his investment in the share capital of TIP in part directly in his own name and in part indirectly through Lippiuno S.r.l., a company in which he holds 85.75% of the share capital.
(3)Cesare d'Amico holds his investment in the share capital of TIP through d'Amico Società di Navigazione S.p.A. (a company in which he holds directly and indirectly 50% of the share capital), through the company Fi.Pa. Finanziaria di Partecipazione S.p.A. (a company which directly holds 54% of the share capital) and through family members.
(5)Paolo d'Amico holds his investments in the share capital of TIP through d'Amico Società di Navigazione S.p.A., a company in which he holds (directly and indirectly) a 50% shareholding.
The members of the Board of Statutory Auditors do not hold shares and/or warrants of the company.
The table below reports the monetary remuneration, expressed in Euro, to the members of the boards in 2016.
| TIP office | Fees 31/12/2016 |
|---|---|
| Directors | 17,054,014 |
| Statutory Auditors | 61,250 |
The remuneration of the Supervisory Board is Euro 3,000.
TIP also signed two insurance policies with Chubb Insurance Company of Europe S.A.- D&O and professional TPL - in favour of the Directors and Statutory Auditors of TIP, of the subsidiaries, as well as the investees companies in which TIP has a Board representative and the General Managers and coverage for damage to third parties in the exercise of their functions.
The table reports the transactions with related parties during the year outlined according to the amounts, type and counterparties.
| Party | Type | Value/Balance at December 31, 2016 |
Value/Balance at December 31, 2015 |
|---|---|---|---|
| Asset Italia S.p.A. | Revenues | 476,283 | - |
| Asset Italia S.p.A. | Trade receivables | 251,470 | - |
| Betaclub S.r.l. | Revenues | 23,728 | - |
| Betaclub S.r.l. | Trade receivables | 23,728 | - |
| BE S.p.A. | Revenues | 60,000 | 60,000 |
| BE S.p.A. | Trade receivables | 30,000 | 60,000 |
| Clubtre S.p.A. | Revenues | 110,608 | 410,534 |
| Clubtre S.p.A. | Trade receivables | 50,608 | 410,225 |
| Clubsette S.r.l. in liquidation | Revenues | 25,000 | 25,343 |
| Clubsette S.r.l. in liquidation | Trade receivables | - | 25,000 |
| Clubitaly S.p.A. | Revenues | 30,606 | 33,204 |
| Clubitaly S.p.A. | Trade receivables | 30,606 | 31,270 |
| Clubitaly S.p.A. | Financial receivables | 220,909 | - |
| Gatti&Co. Gmbh | Revenues | - | 5,605 |
| Gatti&Co. Gmbh | Trade receivables | - | - |
| Gruppo IPG Holding S.p.A. | Revenues | 30,041 | 70,059 |
| Gruppo IPG Holding S.p.A. | Trade receivables | 30,041 | 70,059 |
| Palazzari & Turries S.r.l. | Revenues | - | - |
| Palazzari & Turries S.r.l. | Trade receivables | - | 636 |
| TIP-pre IPO S.p.A. | Revenues | 504,222 | 506,382 |
| TIP-pre IPO S.p.A. | Trade receivables | 253,964 | 502,923 |
| TXR S.r.l. | Revenues | 16,345 | 16,347 |
| TXR S.r.l. | Trade receivables | 16,345 | 15,505 |
| Services provided to companies related to the Board of | |||
| Directors Services provided to companies related to the Board of |
Revenues | 2,025,835 | 192,247 |
| Directors | Trade receivables | 10,810 | 90,420 |
| Services received from companies related to the Board of | |||
| Directors | Costs (services received) | 7,922,858 | 2,458,488 |
| Payables for services received from companies related to the Board of Directors |
Trade payables | 7,306,399 | 1,991,488 |
| Giovanni Tamburi | Revenues (services provided) | 3,352 | 6,128 |
| Giovanni Tamburi | Trade receivables | 3,352 | 6,128 |
The services offered for all the above listed parties were undertaken at contractual terms and
conditions in line with the market.
With reference to the subsequent events, reference should be made to the Directors' Report.
TIP corporate governance adopts the provisions of the new version of the Self-Governance Code published by Borsa Italiana.
The Corporate Governance and Ownership Structure Report for the year is approved by the Board of Directors and published annually on the website of the company www.tipspa.it, in the "Corporate Governance" section.
For the Board of Directors The Chairman Giovanni Tamburi
Milan, March 14, 2017
Declaration of the Executive Officer for financial reporting as per Article 81-ter of Consob Regulation No. 11971 of May 14, 1999 and subsequent amendments and supplements.
of the administrative and accounting procedures for the compilation of the separate financial statements for the year ended December 31, 2016.
No significant aspect emerged concerning the above.
The Chief Executive Officer The Executive Officer
Milan, March 14, 2017
| Company | Registered office | share | number of | number of | % | share of | Book value | |
|---|---|---|---|---|---|---|---|---|
| capital | shares | shares held | held | net equity | in accounts | |||
| Associates | ||||||||
| Asset Italia S.p.A. (1) | Milan | |||||||
| via Pontaccio, 10 | Euro | 1.000.000 | 100.000.000 | 20.000.000 | 20,00 | 2.270.295 | 2.400.000 | |
| Be Think, Solve, Execute S.p.A. | Rome | |||||||
| viale dell'Esperanto, 71 | Euro | 27.109.165 | 134.897.272 | 31.582.225 | 23,41 | 0 | 16.596.459 | |
| Clubitaly S.r.l. (1) | Milan | |||||||
| via Pontaccio, 10 | Euro | 100.000 | 100.000 | 27.500 | 27,50 | 32.922.349 | 33.000.000 | |
| Clubtre S.p.A. (2) | Milan | |||||||
| via Pontaccio, 10 | Euro | 120.000 | 120.000 | 42.000 | 43,28 | 49.767.020 | 34.149.649 | |
| Gatti & Co. GmbH (3) | Frankfurt am Main | |||||||
| Bockenheimer Landstr. 51-53 | Euro | 35.700 | 35.700 | 10.700 | 29,97 | 89.937 | 275.000 | |
| Gruppo IPG Holding S.p.A. (3) | Milan | |||||||
| via Appiani, 12 | Euro | 142.438 | 284.875 | 67.348 | 33,72 | 24.172.380 | 38.392.028 | |
| Palazzari & Turries Limited (4) | Hong Kong | |||||||
| 88 Queen's Road | Euro | 300.000 | 300.000 | 90.000 | 30,00 | 219.445 | 225.000 | |
| Tip-Pre Ipo S.p.A. (1) | Milan | |||||||
| via Pontaccio, 10 | Euro | 244.285 | 2.442.845 | 697.956 | 28,57 | 18.000.912 | 16.285.667 |
(1) Value relating to the updated net equity at 31.12.2016.
(2) Value relating to the updated net equity at al 30.6.2015.
(3) Value relating to the updated net equity at 31.12.2015.
(4) Share capital i n Hong Kong Dollars. Value relating to the updated net equity at 31.12.2015. The net equity was converted at the ERU/HKD rate o f 0.1185 (relating to 31.12.2015).
| Balance at 31.12.2015 | increases | decreases | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| in Euro | No. of | historic | fair value | increases write-downs | book value acquisition or | reclass. | fair value | decreases | fair value | reversal | write-downs book value | |||
| shares | cost | adjustments (decreases) | P&L | fair value subscription | increase | decreases | fair value | P&L | 31.12.2016 | |||||
| Non-listed companies | ||||||||||||||
| Azimut Benetti S.p.A. | 737,725 | 38,990,000 | 38,990,000 | 38,990,000 | ||||||||||
| Talent Garden S.p.A. | 6,250 | 500,000 | 500,000 | |||||||||||
| Altri strumenti partecipativi e altre minori | 1,759,872 | 0 | 63,081 | (794,832) | 1,028,121 | 100,001 | (87,081) | (100,000) | 941,041 | |||||
| Total non-listed companies | 1,759,872 | 0 | 39,053,081 | (794,832) | 40,018,121 | 600,001 | 0 | 0 | (87,081) | 0 | 0 | (100,000) | 40,431,041 | |
| Listed companies | ||||||||||||||
| Amplifon S.p.A. | 9,538,036 | 34,884,370 | 41,372,228 | 76,256,598 | 10,062,628 | 86,319,226 | ||||||||
| Bolzoni S.p.A | 3,107,794 | 5,442,159 | 5,139,652 | 3,045,421 | (1,450,895) | 12,176,337 | 1,187,166 | (7,036,685) | (6,326,818) | 0 | ||||
| Digital Magics S.p.A. | 892,930 | 375,000 | 207,639 | 4,531,009 | 5,113,648 | 19,182 | (1,666,476) | 3,466,354 | ||||||
| Ferrari N.V. USD | 304,738 | (2,333,541) | 17,764,789 | 15,431,248 | 8,402,252 | 4,616,803 (11,493,193) | (148,963) | 16,808,147 | ||||||
| Ferrari N.V. euro | 174,000 | 0 | 7,558,560 | (7,558,560) | (76,276) | 76,276 | 0 | |||||||
| Fiat Chrysler Automobiles N.V. USD | 2,076,925 | 0 | 17,656,453 | 312,958 | 17,969,411 | |||||||||
| Fiat Chrysler Automobiles N.V. | 1,740,000 | 14,846,550 | (1,720,017) | 1,778,655 | 14,905,188 | 171,912 | 15,077,100 | |||||||
| Hugo Boss AG | 901,000 | (16,562,390) | 62,522,390 | 45,960,000 | 15,159,593 | (8,744,463) | 52,375,130 | |||||||
| M&C S.p.A. | 12,562,115 | 1,886,201 | 0 | (195,340) | 1,690,861 | 428,368 | (28,893) | 2,090,336 | ||||||
| Moncler S.p.A. | 5,898,354 | 90,170,236 | 7,329,555 | 97,499,791 | ||||||||||
| Monrif S.p.A | 12,658,232 | 11,374,782 | (135,831) | 0 | (7,895,912) | 3,343,039 | 220,253 | 135,831 | (1,309,249) | 2,389,874 | ||||
| Noemalife S.p.A | 1,248,505 | 5,265,970 | 3,130,226 | 0 | 8,396,196 | 873,356 | (5,265,970) | (4,003,582) | 0 | |||||
| Servizi Italia S.p.A. | 548,432 | 2,938,289 | 387,318 | 0 | (1,241,564) | 2,084,042 | (121,751) | 1,962,291 | ||||||
| Altre società quotate | 2,914,466 | (791,370) | 1,898,798 | 4,021,894 | 182,770 | 186,650 | (69,548) | 32,571 | (701,995) | 3,652,341 | ||||
| Total listed companies | 79,927,787 | 28,693,914 | 91,541,062 (10,783,711) | 189,379,051 | 139,149,046 | 0 | 25,389,648 (31,423,956) (10,608,966) (10,234,685) | (2,040,137) | 299,610,001 | |||||
| Total investments | 81,687,659 | 28,693,914 | 130,594,143 (11,578,543) | 229,397,172 | 139,749,047 | 0 | 25,389,648 (31,511,037) (10,608,966) (10,234,685) | (2,140,137) 340,041,042 |
| TXR S.r.l. | Clubuno S.r.l. | |
|---|---|---|
| ASSETS | ||
| Fixed assets | 29,690,079 | 1,522 |
| Current assets | 104,342 | 13,860 |
| Accrued liabilities and deferred income | 51 | 14 |
| Total assets | 29,794,472 | 15,396 |
| LIABILITIES | ||
| Equity | 29,756,280 | 644 |
| Payables | 38,192 | 14,752 |
| Total liabilities | 29,794,472 | 15,396 |
| INCOME STATEMENT | ||
| Revenues | 58 | 0 |
| Costs of production | (84,802) | (8,849) |
| Revenues | 58 | 0 |
|---|---|---|
| Costs of production | (84,802) | (8,849) |
| EBITDA | (84,744) | (8,849) |
| Amortisation & Depreciation | (734) | (508) |
| Operating Profit/(loss) | (85,478) | (9,357) |
| Financial income | 416,436 | 0 |
| Interest and other financial charges | 0 | 0 |
| Profit before taxes | 330,958 | (9,357) |
| Income taxes | 0 | 0 |
| Utilisation provisions | 0 | 0 |
| Profit/(loss) | 330,958 | (9,357) |
| Attachment 4 - Changes in investments in associates |
|||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Balance at 01.01.2016 | increases | decreases | Book value | ||||||||||||
| in Euro | No. of | historic revaluations | share of | shareholder loan | decreases | Reclass. | increase | Book value Purchases Share of results shareholder loan | increase (decreases) (write-downs) al 31.12.2016 | ||||||
| shares | cost (write-downs) results as per | capital advance | o r |
(decrease) | in accounts | as per | capital advance (decrease) or restitutions revaluations | ||||||||
| equity method | restitutions | fair value | equity method | fair value | |||||||||||
| Asset Italia S.p.A. | - | - | 2,400,000 | 2,400,000 | |||||||||||
| Be Think, Solve, Execute S.p.A. | 31,582,225 16,596,459 | 16,596,459 | 16,596,459 | ||||||||||||
| ClubItaly S.r.l. | 27,500 33,000,000 | 33,000,000 | 33,000,000 | ||||||||||||
| Clubtre S.p.A. | 42,000 | 42,000 | 41,924,346 | (6,475,000) | 35,491,346 | (1,341,697) | 34,149,649 | ||||||||
| Gatti & Co Gmbh | 10,700 | 275,000 | 275,000 | 275,000 | |||||||||||
| Gruppo IPG Holding s.r.l. | 67,348 27,623,451 | 12,218,481 | 39,841,932 | (1,449,904) | 38,392,028 | ||||||||||
| Palazzari & Turries Limited | 90,000 | 225,000 | 225,000 | 225,000 | |||||||||||
| Tip-Pre Ipo S.p.A. | 697,956 8,000,000 | 8,000,000 8,285,667 | 16,285,667 | ||||||||||||
| Totale | 69,165,451 | 0 | 0 | 41,924,346 | (6,475,000) 12,218,481 | 0 | 133,429,737 10,685,667 | 0 0 |
0 | (2,791,601) | 0 141,323,803 |
(in accordance with Article 153 of Legislative Decree 58/98 and Article 2429 of the Civil Code)
Dear Shareholders,
during the year ended December 31, 2016, the Board of Statutory Auditors performed the supervisory activities pursuant to Article 149 of Legislative Decree No. 58/98, in accordance with the conduct principles for the Board of Statutory Auditors issued by the Italian accounting profession (Consiglio Nazionale dei Dottori Commercialisti ed esperti contabili) and the recommendations and communications issued by Consob.
The present report also considered the communications of Consob No. 1025564 of April 6, 2001, No. 3021582 of April 4, 2003 and No. 6031329 of April 7, 2006.
TIP Shareholders' Meeting mandated the Board of Directors powers to increase the share capital for a maximum amount of Euro 1,500,000.00 through payment in kind of Asset Italia shares; the Shareholders' Meeting also approved the elimination of the nominal value of TIP shares;
during the year, following the withdrawal from Ruffini Partecipazioni, shares were assigned in Moncler to the subsidiary Clubsette srl. This operation resulted in a capital gain of approx. Euro 78 million for Clubsette.
Clubsette was then placed in liquidation and the Moncler shares assigned to the shareholders;
The advisory activity generated revenues of approx. Euro 12 million.
During the year the company continued the policy to purchase and sell treasury shares in accordance with law and the resolutions passed.
The Board of Statutory Auditors considers that the operations undertaken are in accordance with law and the incorporating deeds, in the interests of the company, were not imprudent or risky, contrary to the resolutions made by the Shareholders' Meeting or such as to compromise the integrity of the company assets.
An "impairment test" was undertaken on the value of goodwill in accordance with IAS 36, with the conclusion that the value attributed is appropriate and recoverable.
In relation to the valuation of the investees, the relative criteria is described in detail in the Explanatory Notes to the Financial Statements.
The Board of Directors of TIP approved, on July 27, 2016, the following procedures updating those already existing:
Review of the regulation of the Control and Risks and Related Parties Committee and the procedures with related parties;
Review of the code of conduct in relation to corporate information to the market;
Review of the procedure for the management of "persons with access to price sensitive information".
Review of the code of conduct of TIP for the management, handling and communication of information relating to operations on TIP shares or on related financial instruments undertaken by covered persons and connected persons (Internal Dealing Code).
The Board of Directors of TIP, as already illustrated, on July 27, 2016 approved the updated "Procedure for transactions with related parties", already adopted in accordance the Regulation approved by Consob motion No. 17221 of March 12, 2010 and subsequent amendments.
The Board of Statutory Auditors did not note the existence of atypical or unusual transactions with third parties.
During the year transactions were undertaken with related parties of TIP concerning the
provision of services and loans at market conditions.
The inter-company transactions with related parties were adequately reported and described in Explanatory Note No. 33 of the Consolidated Financial Statements.
The Board of Statutory Auditors participated at all of these meetings.
Meetings were also held of the Control and Risks and Related Parties Committee (6
meetings) and the Remuneration Committee (2 meetings).
The Board or at least one of its members attended all of these meetings.
The Board of Statutory Auditors considers the governance instruments adopted by the Company, taking into account its size, are appropriate to ensure compliance with the principles of correct administration.
Based on the provisions of Article 19 of Legislative Decree No. 39 of January 27, 2010, the Board of Statutory Auditors provided oversight on:
No issues arose on which to report.
From the activities undertaken no anomalies arose and the Board considers that the
administration/accounting system to be adequate and reliable for the correct representation of the operating events.
The Company correctly appointed the Executive Officer for the preparation of the corporate accounting documents, pursuant to Article 154-bis of the CFA. The Board of Statutory Auditors also reviewed the periodic and annual reports issued by the internal audit department and during the meetings no significant information warranting disclosure became evident.
Within the verification of the adequacy of the internal control system in accordance with Legislative Decree No. 231/2001, which governs the responsibility of entities for illicit administrative offenses, the Board of Statutory Auditors reports that TIP adopted an Organisational Model with the purpose to prevent such offenses leading to the responsibility of the Company. The Organisation Model is reviewed periodically to take into account operating experience and in accordance with changes in regulations which include penal offenses
A specific board (Supervisory Board) undertakes oversight on the functioning and compliance with the Organisational Model. The Supervisory Board met 3 times; one member of the Board is a member of the Supervisory Board.
anomalies, critical issues or omissions which would require reporting by the Board of Statutory Auditors.
In the financial statements and the remuneration report (pursuant to Article 123-ter CFA and Article 84-quater of the Issuers' Regulation) the company provided information on the remuneration requested by Consob.
The company verified the criteria established by the Self-Governance Code of Borsa Italiana for the qualification as "independent" of the Directors. The Board of Directors, on the basis of the information available to the company and provided by the Directors, assessed the independence of its members. This assessment was also undertaken by the Board of Statutory Auditors, which undertook their own assessment, verifying the correct application of the criteria and procedures.
An independent director undertakes the function of Lead Independent Director and one meeting of the independent directors was held in 2016.
The Board of Directors also undertook a self-assessment process in 2016; the Directors positively assessed the size, composition and functioning of the Board, as well as the governance structure of the Group.
Pursuant to Article 144 quinquiesdecies of the Issuers' Regulation, approved by Consob with motion No. 11971/99 and subsequent modifications and amendments, the corporate offices held by members of the Board of Statutory Auditors in companies pursuant to Section V, Book V, Chapter V, VI and VII of the Civil Code, at the date of the present report are published by Consob and available on the internet site of Consob in accordance with the provisions of Article 144 quaterdecies of the Issuers' Regulation. The Board of Statutory Auditors assessed their own independence, in accordance with Article 148, third paragraph of Legislative Decree No. 58 of 1998and paragraph 8.C.1 of the Self-Governance Code.
The Board of Statutory Auditors, within their supervisory and control activities undertaken during 2016, as described above, did not note any omissions, censurable matters, imprudent operations or irregularities.
No further matters require mention in the present report pursuant to Article 153, paragraph 1 of the CFA.
The Board of Statutory Auditors do not have any proposals to be presented to the Shareholders' Meeting, pursuant to Article 153, paragraph 2 of the CFA.
In accordance with our findings the Board of Statutory Auditors have no reason to oppose the approval of the financial statements as at December 31, 2016, which reports a profit of Euro 41,072,198 and the proposal made by the Board of Directors in relation to the allocation of the net profit.
***
Milan,
The Board of Statutory Auditors
The Chairman of the Board of Statutory Auditors – Mr. Emanuele Cottino
The Statutory Auditor – Ms. Paola Galbiati
The Statutory Auditor – Mr. Andrea Mariani
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