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TERNIUM ARGENTINA S.A. — Interim / Quarterly Report 2001
Nov 16, 2000
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Download source fileSIDERAR SOCIEDAD ANONIMA
INDUSTRIAL Y COMERCIAL
FINANCIAL STATEMENTS
AT SEPTEMBER 30, 2000
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
FINANCIAL STATEMENTS
AT SEPTEMBER 30, 2000
CONTENTS
Summary information
Financial statements at September 30, 2000
Balance sheet
Statement of income
Statement of changes in shareholders' equity
Statement of sources and uses of funds
Notes and exhibits to the financial statements
Consolidated financial statements
Limited review report
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
SUMMARY INFORMATION
In accordance with the regulations of Resolution No. 290/97 of the National Securities Commission the Board of Directors has approved the following information corresponding to the three-month period begun on July 1, 2000 and ended on September 30, 2000.
1. ACTIVITIES OF THE COMPANY
In the first quarter of the year the Company recorded a profit of $ 11,725,632, which compares favorably with the loss of $ 6,559,604 recorded in the same period of the previous year.
The positive result was due to an increase of $ 10,517,654 in ordinary income, from an improvement in gross margin and a lower loss of $ 7,767,582 recorded as the result of investments in related companies.
The increase in gross margin has mainly been due to the rise in average sales prices, driven by higher export prices compared to those in force in the same quarter of the previous year.
Total shipment volumes were down 13%. Domestically, a persistent unfavorable economic context depressed shipment levels, which did not manage to recover their levels of two years previously. As a consequence, export volumes remained at a high level, totaling 235.4 thousand tonnes. Exports of flat products increased 12% compared to the previous quarter, falling 3% compared to those for the same period of the previous year. During the quarter no export sales of ingots were made.
Both overhead and net financial results remained at similar levels to those of the same quarter of the previous year.
In the industrial area, the various lines subjected to ever increasing quality demands by the market have continued to perform well. Work force productivity reached 3.8 man hours per tonne of liquid steel during September, a level that compares favorably with the most efficient international steel companies.
During July two three-year loans were obtained for a total of US$ 34.7 million to improve the indebtedness profile. Bank and financial debt has remained at similar levels to those of June 2000, showing a drop of $ 49.5 million compared to the same quarter of the previous year.
Other significant events during the year:
On September 5, 2000 the Board of the Company accepted the resignation of the Company’s Executive Vice-president, Javier O. Tizado, who has been appointed Secretary for Industry, Commerce and Mining by the Government.
Subsequent to the end of the period, on October 6, 2000 a Shareholders’ Meeting was held for Siderar S.A.I.C. This approved the proposed distribution of results and voted to make payment as from October 23 of the amount of $ 13,898,751 provided for as dividends.
2. CONSOLIDATED EQUITY STRUCTURE (compared to the periods ended September 30, 1996, 1997, 1998 and 1999 - Amounts stated in thousands of pesos)
| 9.30.00 | 9.30.99 | 9.30.98 | 9.30.97 | 9.30.96 (1) | |
| Current assets | 485,087 | 496,505 | 539,104 | 494,589 | 432,981 |
| Non-current assets | 859,853 | 875,504 | 938,201 | 787,829 | 706,465 |
| Total | 1,344,940 | 1,372,009 | 1,477,305 | 1,282,418 | 1,139,446 |
| Current liabilities | 358,533 | 367,528 | 435,565 | 432,550 | 281,462 |
| Non-current liabilities | 339,100 | 378,646 | 368,751 | 245,983 | 299,581 |
| Sub-total | 697,633 | 746,174 | 804,316 | 678,533 | 581,043 |
| Minority interest in subsidiaries | 58 | 53 | 101 | 74 | - |
| Shareholders' equity | 647,249 | 625,782 | 672,888 | 603,811 | 558,403 |
| Total | 1,344,940 | 1,372,009 | 1,477,305 | 1,282,418 | 1,139,446 |
- In previous periods the Company did not hold investments in subsidiaries requiring consolidation.
3. CONSOLIDATED INCOME STRUCTURE (compared to the periods ended September 30, 1996, 1997, 1998 and 1999 - Amounts stated in thousands of pesos)
| 7.1.00 to 9.30.00 | 7.1.99 to 9.30.99 | 7.1.98 to 9.30.98 | 7.1.97 to 9.30.97 | 7.1.96 to 9.30.96 (1) | |
|---|---|---|---|---|---|
| Result from ordinary operations | 33,186 | 18,240 | 52,085 | 64,848 | 51,048 |
| Financial result | (8,768) | (9,220) | (8,033) | (7,929) | (8,202) |
| Other ordinary income and expenses | (2,992) | (4,799) | (4,360) | (3,980) | (555) |
| Minority interest in subsidiaries | (4) | (1) | (6) | (4) | - |
| Result before tax | 21,422 | 4,220 | 39,686 | 52,935 | 42,291 |
| Taxes | (6,991) | (307) | (14,300) | (18,540) | (13,440) |
| Ordinary result | 14,431 | 3,913 | 25,386 | 34,395 | 28,851 |
| Result from investments in related companies | (2,705) | (10,473) | 1,571 | 1 | - |
| Other income and expenses | - | - | - | - | (4,944) |
| Net result for the period | 11,726 | (6,560) | 26,957 | 34,396 | 23,907 |
- In previous periods the Company did not hold investments in subsidiaries requiring consolidation.
4. CONSOLIDATED STATISTICAL DATA (compared to the periods ended September 30, 1996, 1997, 1998 and 1999 - Amounts stated in thousands of tons)
| 7.1.00 to 9.30.00 | 7.1.99 to 9.30.99 | 7.1.98 to 9.30.98 | 7.1.97 to 9.30.97 | 7.1.96 to 9.30.96 (1) | |
| Shipments (2) | 489 | 563 | 551 | 578 | 525 |
| Domestic market | 254 | 292 | 408 | 431 | 378 |
| Exports | 235 | 271 | 143 | 147 | 147 |
| Production | |||||
| Hot rolled steel | 589 | 550 | 483 | 541 | 502 |
| Cold rolled steel | 362 | 359 | 352 | 360 | 326 |
| Coated | 156 | 161 | 142 | 128 | 79 |
- In previous periods the Company did not hold investments in subsidiaries requiring consolidation.
- Includes 37.2, 44.7, 37.5, 32.2 and 5.6 thousand tons of pig iron bars for the periods ended September 30, 1996, 1997, 1998, 1999 and 2000, respectively.
5. CONSOLIDATED RATIOS (compared to the periods ended September 30, 1996, 1997, 1998 and 1999)
| 9.30.00 | 9.30.99 | 9.30.98 | 9.30.97 | 9.30.96 (1) | |
| Liquidity | 1.35 | 1.35 | 1.24 | 1.14 | 1.54 |
| Indebtedness | 1.08 | 1.19 | 1.20 | 1.12 | 1.04 |
- In previous periods the Company did not hold investments in subsidiaries requiring consolidation.
6. OUTLOOK
Economic activity levels continue at a depressed level, without showing any signs of recovery, and economic analysts have modified their GDP growth forecasts for 2000 under 1%.
On this basis the Company estimates that recovery in the level of shipments to the domestic market will take place gradually, and that a significant improvement will only be able to be seen next year. The Company considers it will be able to maintain the high level of export sales it has achieved during the previous year, in spite of the drop in the expected level of international steel prices already noted in the quarter just ended.
Buenos Aires, November 7, 2000
THE BOARD OF DIRECTORS
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
FINANCIAL STATEMENTS for the three-month period ended September 30, 2000
Fiscal year No. 40 beginning on July 1, 2000
Legal address: Leandro N. Alem 1067, Buenos Aires
Main activity: Promotion, construction and operation of steel mills, production and marketing of steel, iron and steel products
From the by-laws and articles of incorporation:
Date of registration in the National Commercial Court of Record of First Instance: March 7, 1962
From the amendments:
Dates of registration in the National Commercial Court of Record of First Instance:
November 10, 1966;
October 10, 1967;
June 11, 1969;
June 9, 1971;
June 24, 1976;
July 1, 1977;
October 5, 1977;
June 26, 1980;
October 13, 1980;
March 29, 1982;
April 27, 1983;
April 11, 1984;
April 2, 1985;
May 7, 1986;
June 30, 1987;
August 10, 1992;
September 16, 1992;
July 28, 1993;
May 6, 1994;
January 5, 1995;
November 7, 1995;
May 28, 1996;
March 11, 1997; and
September 30, 1999
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
FINANCIAL STATEMENTS for the three-month period ended September 30, 2000
Registration number with the Superintendency of Corporations: 14510
Duration of the Company: Up to April 2, 2090
Capital: Par value shares of 1 peso and one vote each
| Class | No. of votes per share | Subscribed and paid-in |
| $ | ||
| Common "A" shares outstanding | 1 | 310,891,625 |
| Common "B" shares outstanding | 1 | 36,577,146 |
| Total | 347,468,771 |
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
Registration number with the Superintendency of Corporations: 14510
BALANCE SHEET at September 30, 2000, compared to the same period of the previous year
| 9.30.00 | 9.30.99 | 9.30.00 | 9.30.99 | |||
| $ | $ | $ | $ | |||
| ASSETS | LIABILITIES | |||||
| CURRENT ASSETS | CURRENT LIABILITIES | |||||
| Cash and banks (Note 3.a)) | 5,779,402 | 5,827,889 | Accounts payable (Note 3.h)) | 107,628,201 | 88,107,179 | |
| Other investments (Exhibit D) | 704,327 | 25,868,978 | Short-term debt (Note 3.i)) | 204,796,342 | 218,174,867 | |
| Trade receivables (Note 3.b)) | 190,084,993 | 177,586,239 | Social security and taxes (Note 3.j)) | 38,889,564 | 41,698,493 | |
| Other receivables (Note 3.c)) | 36,188,667 | 44,169,767 | Other liabilities (Note 3.k)) | 4,385,278 | 16,261,489 | |
| Inventories (Exhibit F) | 246,362,446 | 238,054,796 | Provisions for contingencies (Exhibit E) | 2,896,513 | 3,129,954 | |
| Other assets (Note 3.d)) | 2,113,826 | 1,603,771 | ||||
| Total current assets | 481,233,661 | 493,111,440 | Total current liabilities | 358,595,898 | 367,371,982 | |
| NON-CURRENT ASSETS | NON-CURRENT LIABILITIES | |||||
| Trade receivables (Note 3.e)) | 4,421,314 | 953,144 | Accounts payable (Note 3.l)) | 9,470,142 | 11,922,660 | |
| Other receivables (Note 3.f)) | 15,423,347 | 26,148,468 | Long-term debt (Note 3.m)) | 312,406,709 | 348,430,006 | |
| Investments (Exhibit C) | 106,146,992 | 67,708,932 | Social security and taxes (Note 3.n)) | 3,565,912 | 4,302,048 | |
| Other investments (Exhibit D) | 29,979,125 | 39,255,249 | Other liabilities | 303,540 | 362,174 | |
| Intangible assets (Exhibit B) | 3,211,498 | 5,505,275 | Provisions for contingencies (Exhibit E) | 13,353,967 | 13,629,420 | |
| Fixed assets (Exhibit A) | 702,681,165 | 735,796,283 | ||||
| Other assets (Note 3.g)) | 1,847,572 | 3,321,650 | ||||
| Total non-current assets | 863,711,013 | 878,689,001 | Total non-current liabilities | 339,100,270 | 378,646,308 | |
| Total liabilities | 697,696,168 | 746,018,290 | ||||
| SHAREHOLDERS' EQUITY (as per respective statement) | 647,248,506 | 625,782,151 | ||||
| Total assets | 1,344,944,674 | 1,371,800,441 | Total liabilities and shareholders’ equity | 1,344,944,674 | 1,371,800,441 |
The accompanying notes 1 to 12 and exhibits A to I are an integral part of these financial statements.
The report on limited review is issued as a separate document.
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
Registration number with the Superintendency of Corporations: 14510
STATEMENT OF INCOME for the three-month period ended September 30, 2000, compared to the same period of the previous year
| 9.30.00 | 9.30.99 | |
| $ | $ | |
| Net income from sales | 233,391,455 | 240,961,856 |
| Cost of sales (Exhibit F) | (174,114,438) | (197,026,498) |
| Gross profit | 59,277,017 | 43,935,358 |
| Selling expenses (Exhibit H) | (7,979,298) | (7,553,343) |
| Administrative expenses (Exhibit H) | (18,541,842) | (18,850,260) |
| Financial and holding results | ||
| Generated by assets (Exhibit H) | 4,066,527 | 1,439,269 |
| Generated by liabilities (Exhibit H) | (14,077,876) | (10,675,211) |
| Other ordinary income and expenses (Exhibit H) | (2,992,099) | (4,798,355) |
| Income before taxes | 19,752,429 | 3,497,458 |
| Income tax provision charge | (6,980,000) | (300,000) |
| Ordinary income | 12,772,429 | 3,197,458 |
| Result from investments in subsidiaries and related companies (Note 7.e)) | (1,046,797) | (9,757,062) |
| Net income (loss) for the period | 11,725,632 | (6,559,604) |
The accompanying notes 1 to 12 and exhibits A to I are an integral part of these financial statements.
The report on limited review is issued as a separate document.
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
Registration number with the Superintendency of Corporations: 14510
STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY for the three-month period ended September 30, 2000, compared to the same period of the previous year
| Capital stock | Non-capitalized contributions | Retained earnings | 9.30.00 | 9.30.99 | ||||||
| Item | Shares outstanding | Capital adjustment | Total | Premium on issue of shares | Legal reserve | Reserve for future dividends | Free reserve | Unappropriated retained earnings | Total shareholders' equity | Total shareholders' equity |
| $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |
| Balances at the beginning of the period | 347,468,771 | 27,348,487 | 374,817,258 | 21,194,650 | 19,607,273 | 196,722,574 | 20,000,000 | 3,181,119 | 635,522,874 | 646,540,506 |
| Approved by the Shareholders' Ordinary Meeting on September 30, 1999 | ||||||||||
| - Distribution of profits | ||||||||||
| Hnos. Agustín y Enrique Rocca Foundation | - | - | - | - | - | - | - | - | - | (300,000) |
| Cash dividends | - | - | - | - | - | - | - | - | - | (13,898,751) |
| Result for the period as per statement of income | - | - | - | - | - | - | - | 11,725,632 | 11,725,632 | (6,559,604) |
| Balances at September 30, 2000 | 347,468,771 | 27,348,487 | 374,817,258 | 21,194,650 | 19,607,273 | 196,722,574 | 20,000,000 | 14,906,751 | 647,248,506 | |
| Balances at September 30, 1999 | 347,468,771 | 27,348,487 | 374,817,258 | 21,194,650 | 19,607,273 | 196,722,574 | 20,000,000 | (6,559,604) | 625,782,151 |
The accompanying notes 1 to 12 and exhibits A to I are an integral part of these financial statements.
The report on limited review is issued as a separate document.
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
Registration number with the Superintendency of Corporations: 14510
STATEMENT OF SOURCES AND USES OF FUNDS for the three-month period ended September 30, 2000, compared to the same period of the previous year
| 9.30.00 | 9.30.99 | |
| $ | $ | |
| CHANGES IN FUNDS | ||
| Funds at the beginning of the period (1) | 9,281,212 | 20,899,186 |
| (Decrease) increase in funds | (2,797,483) | 10,797,681 |
| Funds at the end of the period (1) | 6,483,729 | 31,696,867 |
| CAUSES OF CHANGES IN FUNDS | ||
| Ordinary income | 12,772,429 | 3,197,458 |
| Add: Items not representing funds disbursements | ||
| Depreciation of fixed assets | 19,836,265 | 18,875,612 |
| Depreciation of other current assets | 16,575 | 13,118 |
| Amortization of intangible assets | 535,250 | 626,916 |
| Allowance for doubtful accounts | 1,800,000 | 794,074 |
| Income tax provision charge | 6,980,000 | 300,000 |
| Board of Directors' and Surveillance Committee's fees provision | 279,000 | 308,000 |
| Provision for contingencies | 533,998 | 70,503 |
| Funds generated by ordinary operations | 42,753,517 | 24,185,681 |
| Holding result in subsidiaries and related companies | (1,046,797) | (9,757,062) |
| Add: Items not representing funds disbursements | ||
| Holding result in subsidiaries and related companies | 1,046,797 | 9,757,062 |
| Funds generated (applied) to remaining operations | - | - |
| Funds generated by operations | 42,753,517 | 24,185,681 |
| Other causes of sources of funds | ||
| Net increase (decrease) in short and long-term debt | 1,163,016 | (4,501,862) |
| Total sources of funds - Carried forward | 43,916,533 | 19,683,819 |
(1) Cash and banks plus other current investments
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
Registration number with the Superintendency of Corporations: 14510
STATEMENT OF SOURCES AND USES OF FUNDS for the three-month period ended September 30, 2000, compared to the same period of the previous year
| 9.30.00 | 9.30.99 | |
| $ | $ | |
| CAUSES OF CHANGES IN FUNDS (Contd.) | ||
| Brought forward | 43,916,533 | 19,683,819 |
| Other causes of uses of funds | ||
| Net increase in trade receivables | (10,338,764) | (2,196,888) |
| Net increase in other receivables | (1,798,280) | (8,231,247) |
| Net (increase) decrease in inventories | (11,289,590) | 19,441,906 |
| Net (increase) decrease in other assets | (233,558) | 624,265 |
| Net increase in other non-current investments | (1,102,793) | (1,144,061) |
| Net increase in fixed assets | (17,760,059) | (4,474,106) |
| Net decrease in trade payables | (1,530,583) | (16,788,638) |
| Net (decrease) increase in social security and taxes | (2,233,181) | 4,083,687 |
| Net decrease in other liabilities | (124,541) | (114,231) |
| Decrease in provision for contingencies | (302,667) | (86,825) |
| Total uses of funds | (46,714,016) | (8,886,138) |
| (Decrease) increase in funds | (2,797,483) | 10,797,681 |
The accompanying notes 1 to 12 and exhibits A to I are an integral part of these financial statements.
The report on limited review is issued as a separate document.
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
Registration number with the Superintendency of Corporations: 14510
NOTES TO THE FINANCIAL STATEMENTS at September 30, 2000
NOTE 1 - BASES FOR THE PREPARATION OF FINANCIAL STATEMENTS
The financial statements have been prepared in accordance with General Resolution
No. 290/97 of the National Securities Commission.
NOTE 2 - ACCOUNTING STANDARDS
The most significant accounting standards are as follows:
2.1. Comparative information
The financial statements are presented in pesos in two columns in comparative form with those of the same period of the previous year.
2.2. Recognition of the effects of inflation
The financial statements have been prepared in constant currency, reflecting the overall effects of inflation through August 31, 1995. In accordance with General Resolution No. 290/97 of the National Securities Commission, restatement of the financial statements has been discontinued as from September 1, 1995.
2.3. Valuation criteria
These financial statements have been prepared applying the valuation criteria established by General Resolution No. 290/97 of the National Securities Commission, as explained below:
- Assets and liabilities in local currency without adjustment clauses are stated at their nominal value plus the accrued financial results up to the end of the period.
- Assets and liabilities in foreign currency have been valued at the corresponding exchange rates in effect at the end of the period plus the accrued financial results up to that date.
NOTE 2 - ACCOUNTING STANDARDS (Contd.)
2.3. Valuation criteria (Contd.)
- Export reimbursements have been valued at the rates of exchange for the U.S. dollar in force at the end of the period applied on par values in foreign currency and included in the Trade receivables - export reimbursements.
d) Advances to suppliers are stated at their current value.
e) Inventories have been valued at their replacement cost at the end of the period, applying the direct industrial cost method and including the indirect manufacturing expenses, except fixed assets depreciation and general expenses.
Materials have been valued at their replacement cost at the end of the period.
f) Property included under Other current assets has been valued at acquisition cost. Depreciation has been calculated by the straight-line method, using annual rates sufficient to extinguish their values by the end of their estimated useful lives.
Other non-current assets are valued at construction cost and include real property mostly for sale to personnel.
g) Steel spares and supplies, included in fixed assets, have been valued at the lowest of their restated cost value or recoverable value. The recoverable value has been calculated on the basis of the values of last purchases or quotations from suppliers on dates close to the end of the period.
Fixed assets at the Ensenada Plant which had been technically appraised (based on the valuation carried out at June 30, 1990) were restated for inflation as mentioned in Note 2.2. to the financial statements. The remaining fixed assets have been valued at their restated cost. Depreciation of fixed assets has been calculated according to the straight-line method by applying annual rates sufficient to extinguish their values by the end of their estimated useful lives.
The aggregate net value of fixed assets does not exceed recoverable value.
NOTE 2 - ACCOUNTING STANDARDS (Contd.)
2.3. Valuation criteria (Contd.)
- The participation in other companies has been valued at proportional equity value based on the financial statements mentioned in Exhibit C to the financial statements, except for the investment in FO.GA.BA. S.A.P.E.M., which is valued at acquisition cost. In addition, the accounting standards adopted by subsidiaries and related companies have been unified with the accounting criteria followed by Siderar S.A.I.C. For purposes of translation into pesos of the financial statements of Prosid Investments Inc., the criteria established by Technical Pronouncement No. 13 of the Argentine Federation of Professional Councils in Economic Sciences were used.
- Compañía Afianzadora de Empresas Siderúrgicas S.G.R. risk fund, recorded by Siderar S.A.I.C. under Other investments, corresponds to the portion attributable to that company considering the percentage contributions paid by the protecting partners of Sociedad de Garantía Recíproca and the value of the fund at September 30, 2000 (see Note 7.c) to the financial statements).
j) The goodwill (Comesi S.A.I.C.) corresponds to the difference between the value paid for the shares of Comesi S.A.I.C. and the proportional equity value at the date of purchase once the accounting values of the assets of the issuer have been adjusted by their respective current values. Goodwill is amortized by the straight-line method, over a maximum term of five years as from April 1997.
k) The Company has capitalized the financial costs from the projects for the modernization of its fixed assets.
To calculate the capitalizable financial charge the Company’s financing cost has been estimated by computing the results generated by all items making up its financing structure.
The abovementioned capitalization is made until the works-related assets giving rise to it become operative, and will be amortized applying the same criteria used for the assets constructed.
Financial costs capitalized in the period amounted to $ 119,069.
- The implicit financial components included in the assets, liabilities and income balances have been segregated, if significant.
NOTE 2 - ACCOUNTING STANDARDS (Contd.)
2.3. Valuation criteria (Contd.)
- The Company has set up the allowances and provisions considered necessary so that the value assigned to assets does not exceed their recoverable value and that the value assigned to liabilities is not lower than the value which may be claimable by third parties.
The provisions disclosed in current and non-current liabilities for a total of $ 16,250,480 were set up to meet potential contingencies.
- As from August 1, 1995, the Company implemented a retirement benefit plan in favor of certain officials. Since that date the resulting liabilities are being accrued during the remaining years of service of the beneficiaries involved. At the end of the period in progress these liabilities are shown under "Social security and taxes" as a non-current liability, no debt being claimable as at that date.
In addition, the Company has taken out endowment policies which could be used to provide partial or total cover for these benefits.
- Non-current credits and liabilities accrue interest at normal market rates.
- From time to time the Company enters into transactions involving financial derivatives for hedging purposes, to smooth out fluctuations in exchange rates for currencies other than the U.S. dollar, interest rates on its bank and financial debt and the prices of certain raw materials used in its manufacturing process. The results from these operations are recognized and disclosed during the life of the corresponding contracts.
- The Company calculates income tax by applying a 35% rate on taxable profits, the corresponding charge being disclosed in the statement of income under charge for income tax provision.
The tax on minimum notional income is applicable to the potential income from certain productive assets at the rate of 1% and supplements income tax, so that the Company’s tax liability will be equivalent to the higher of those taxes. However, if the tax on minimum notional income exceeds income tax in a given fiscal year, that surplus can be computed as payment on account of income tax in excess of the tax on minimum notional income arising in any of the following four fiscal years. At the end of the period, the Company had not set up any provision for minimum notional income tax, as it expects that by the end of the year the income tax due will exceed the amount payable for minimum notional income tax.
- The Company's Board of Directors considers that aggregate valuation of assets captions is less than their recoverable value.
NOTE 3 - COMPOSITION OF BALANCE SHEET ITEMS
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| CURRENT ASSETS | ||
| a) Cash and banks | ||
| Cash | 194,341 | 198,830 |
| Checks to be deposited | 4,749,922 | 2,088,542 |
| Banks | 835,139 | 3,540,517 |
| 5,779,402 | 5,827,889 | |
| b) Trade receivables | ||
| Accounts receivable | 111,522,102 | 108,839,622 |
| Related companies Sect. 33 - Law No. 19550 and amendments | 2,146,236 | 1,317,956 |
| Export reimbursements | 3,580,690 | 3,880,796 |
| Notes receivable | 81,692,635 | 72,919,637 |
| Allowance for doubtful accounts (Exhibit E) | (7,438,096) | (7,624,730) |
| Unearned interest | (1,418,574) | (1,747,042) |
| 190,084,993 | 177,586,239 | |
| c) Other receivables | ||
| Related companies Sect. 33 - Law No. 19550 and amendments | 3,707,960 | 9,688,418 |
| Advances and loans to personnel | 3,371,400 | 3,038,593 |
| Receivables from sale of real property | 445,399 | 467,157 |
| Tax credits | 18,910,704 | 20,744,359 |
| Advances to suppliers | 1,002,227 | 1,357,229 |
| Expenses paid in advance | 2,101,242 | 2,135,659 |
| Sundry receivables | 6,649,735 | 6,738,352 |
| 36,188,667 | 44,169,767 | |
| d) Other assets (residual value) | ||
| Real property | 2,113,826 | 1,603,771 |
| 2,113,826 | 1,603,771 | |
| The depreciation of the period amounted to $ 16.575 (Exhibit H). | ||
NOTE 3 - COMPOSITION OF BALANCE SHEET ITEMS (Contd.)
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| NON-CURRENT ASSETS | ||
| e) Trade receivables | ||
| Notes receivable | 7,495,314 | 1,036,144 |
| Allowance for doubtful accounts (Exhibit E) | (3,074,000) | (83,000) |
| 4,421,314 | 953,144 | |
| f) Other receivables | ||
| Related companies Sect. 33 - Law No. 19550 and amendments | 1,720,760 | - |
| Advances and loans to personnel | 1,748,408 | 1,630,777 |
| Receivables from sale of real property | 6,646,363 | 6,289,876 |
| Tax credits | 3,241,503 | - |
| Expenses paid in advance | 1,794,066 | 3,140,806 |
| Financial credits | - | 14,915,064 |
| Sundry receivables | 272,247 | 171,945 |
| 15,423,347 | 26,148,468 | |
| g) Other assets | ||
| Real property | 1,847,572 | 3,321,650 |
| 1,847,572 | 3,321,650 | |
| CURRENT LIABILITIES | ||
| h) Accounts payable | ||
| Ordinary suppliers | 51,647,937 | 49,220,199 |
| Related companies Sect. 33 - Law No. 19550 and amendments | 2,167,969 | 1,990,957 |
| Notes payable | 53,157,455 | 35,480,098 |
| Unearned interest | (1,022,033) | (1,370,683) |
| Advances from customers | 1,676,873 | 2,786,608 |
| 107,628,201 | 88,107,179 |
NOTE 3 - COMPOSITION OF BALANCE SHEET ITEMS (Contd.)
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| CURRENT LIABILITIES (Contd.) | ||
| i) Short-term debt | ||
| Financial | 785,318 | - |
| Import/export financing | 226,197,671 | 237,411,884 |
| Unearned interest | (22,186,647) | (19,237,017) |
| 204,796,342 | 218,174,867 | |
| j) Social security and taxes | ||
| Provision for income tax/minimum notional | 12,273,000 | 18,502,082 |
| Income tax withholding and solidarity contribution | (12,273,000) | (11,723,347) |
| Income tax advances | - | (6,778,735) |
| Provision for turnover tax | 116,838 | 293,408 |
| Wages and social security | 36,614,302 | 36,783,349 |
| Others sundry | 2,158,424 | 4,621,736 |
| 38,889,564 | 41,698,493 | |
| k) Other liabilities | ||
| Dividends payable | - | 13,898,751 |
| Sundry | 4,385,278 | 2,362,738 |
| 4,385,278 | 16,261,489 | |
| NON-CURRENT LIABILITIES | ||
| l) Accounts payable | ||
| Notes payable | 10,588,426 | 13,730,088 |
| Unearned interest | (1,118,284) | (1,807,428) |
| 9,470,142 | 11,922,660 |
NOTE 3 - COMPOSITION OF BALANCE SHEET ITEMS (Contd.)
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| NON-CURRENT LIABILITIES (Contd.) | ||
| m) Long-term debt | ||
| Import/export financing | 231,884,300 | 282,302,402 |
| Negotiable Corporate Bonds | 110,000,000 | 110,000,000 |
| Unearned interest | (29,477,591) | (43,872,396) |
| 312,406,709 | 348,430,006 | |
| n) Social security and taxes | ||
| Income tax provision | 6,980,000 | 300,000 |
| Withholdings/credit for minimum national income tax | (6,980,000) | (300,000) |
| Sundry | 3,565,912 | 4,302,048 |
| 3,565,912 | 4,302,048 |
NOTE 4 - RECEIVABLES AND PAYABLES: DUE DATES AND RATES
| Captions | Up to 3 months | Between 3 and 6 months | Between 6 and 9 months | Between 9 and 12 months | Between 1 and 2 years | Between 2 and 3 years | Between 3 and 4 years | Over 4 years | Total at 9.30.00 | Total at 9.30.99 |
| $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |
| Over due | ||||||||||
| Trade receivables - fixed rate | 4,587,157 | 728,159 | 438,735 | 882,421 | 2,176,176 | 1,689,653 | 1,277,353 | 1,014,367 | 12,794,021 | 8,865,499 |
| Total at 9.30.00 | 4,587,157 | 728,159 | 438,735 | 882,421 | 2,176,176 | 1,689,653 | 1,277,353 | 1,014,367 | 12,794,021 | |
| Total at 9.30.99 | 2,480,367 | 1,000,423 | 794,781 | 244,910 | 1,438,532 | 1,208,390 | 543,930 | 1,154,166 | 8,865,499 | |
| Not yet due | ||||||||||
| Deposits of funds - fixed rate | 704,327 | - | - | - | - | - | - | - | 704,327 | 25,868.978 |
| Deposits of funds - floating rate | - | - | - | - | - | - | - | 6,961,855 | 6,961,855 | 5,279,020 |
| Trade receivables - fixed rate | 163,602,845 | 13,827,184 | 1,662,646 | 2,055,703 | 1,256,287 | 1,659,382 | 1,948,873 | 2,630,772 | 188,643,692 | 173,500,818 |
| Trade receivables - without rate | 3,580,690 | - | - | - | - | - | - | - | 3,580,690 | 3,880,796 |
| Other receivables - fixed rate | 3,088,365 | 751,897 | 636,513 | 584,270 | 1,547,418 | 1,028,140 | 652,973 | 5,251,104 | 13,540,680 | 19,553,379 |
| Other receivables - floating rate | 2,990,082 | 15,750 | 15,750 | 15,750 | 1,783,760 | 63,000 | 47,250 | - | 4,931,342 | 18,082,501 |
| Other receivables - without rate | 20,128,717 | 5,206,341 | 1,783,092 | 972,140 | 3,955,157 | 875,796 | 31,004 | 187,745 | 33,139,992 | 32,682,355 |
| Total at 9.30.00 | 194,095,026 | 19,801,172 | 4,098,001 | 3,627,863 | 8,542,622 | 3,626,318 | 2,680,100 | 15,031,476 | 251,502,578 | - |
| Total at 9.30.99 | 206,445,285 | 13,513,647 | 11,632,442 | 14,792,841 | 3,868,807 | 2,021,608 | 1,182,221 | 25,390,996 | - | 278,847,847 |
| Accounts payable - fixed rate | 48,703,910 | 11,398,450 | 7,015,823 | 8,618,438 | 1,464,509 | 1,412,159 | 908,264 | 690,645 | 80,212,198 | 62,077,192 |
| Accounts payable - floating rate | 1,049,309 | - | 832,427 | - | 1,664,855 | 1,664,855 | 1,664,855 | - | 6,876,301 | 8,533,609 |
| Accounts payable - without rate | 29,732,028 | 277,816 | - | - | - | - | - | - | 30,009,844 | 29,419,038 |
| Short and long-term debt - fixed rate | 58,390,050 | 46,720,361 | 3,540,702 | 7,363,074 | 16,706,277 | 20,894,840 | 4,314,186 | 2,868,037 | 160,797,527 | 322,529,219 |
| Short and long-term debt - floating rate | 3,876,929 | 330,122 | 83,839,842 | 735,262 | 154,663,454 | 104,088,519 | 8,337,345 | 534,051 | 356,405,524 | 244,075,654 |
| Social security and taxes - without rate | 24,333,422 | 10,141,549 | 31,128 | 4,383,465 | - | - | - | 3,565,912 | 42,455,476 | 46,000,541 |
| Other debt - without rate | 3,055,788 | 281,943 | 146,048 | 901,499 | 127,130 | 102,506 | 57,104 | 16,800 | 4,688,818 | 16,623,663 |
| Total at 9.30.00 | 169,141,436 | 69,150,241 | 95,405,970 | 22,001,738 | 174,626,225 | 128,162,879 | 15,281,754 | 7,675,445 | 681,445,688 | |
| Total at 9.30.99 | 147,927,707 | 149,311,846 | 52,437,114 | 14,565,361 | 109,861,882 | 162,501,749 | 77,887,042 | 14,766,215 | 729,258,916 |
- The allowances for doubtful accounts and existing guarantees are sufficient to cover overdue trade receivables.
- Interest rates are not lower than market rates.
- There are no receivables or debts without stated due date.
NOTE 5 - CHANGES IN ACCOUNTING PROCEDURES
The Company has followed the same criteria adopted in the previous year as regards valuations, depreciations and other items.
NOTE 6 - ENCUMBERED AND RESTRICTED ASSETS AND SURETIES GRANTED
Pledges have been set up on Company assets in guarantee of debts incurred as a result of the purchase of pledged assets amounting to US$ 1,544,587.
In accordance with the contracts signed as a result of the incorporation of Consorcio Siderurgia Amazonia Ltd., guarantees were granted as mentioned in Note 7.b) to the financial statements.
At period-end, the Company had become the guarantor of obligations for US$ 2,964,865.
NOTE 7 - INVESTMENTS IN OTHER COMPANIES
a) Comesi San Luis S.A.I.C.
On April 14, 1997, the Company acquired all of the shares held by the minority shareholders of Comesi San Luis S.A.I.C., 98% of which was held by Comesi S.A.I.C. at that date. The purpose of Comesi San Luis S.A.I.C. is the production of cold or hot strip mill sheets either pre-painted or not, formed and/or skelped. The price paid for the 22,000 shares of par value $ 0.0001 each representing 2% of the capital stock of Comesi San Luis S.A.I.C. amounted to US$ 130,720. As a result of the merger with Comesi S.A.I.C., the Company acquired 100% of the shares of Comesi San Luis S.A.I.C. and consequently on June 29, 1999 Siderar S.A.I.C. sold the 1% equity participation for a total value of $ 42,900.
b) Prosid Investments Inc. - Consorcio Siderurgia Amazonia Ltd.
On November 13, 1997 Consorcio Siderurgia Amazonia Ltd. (Amazonia) was set up to participate in the bid for 70% of Siderúrgica del Orinoco C.A. (Sidor) which was being privatized by the Government of Venezuela.
NOTE 7 - INVESTMENTS IN OTHER COMPANIES (Contd.)
b) Prosid Investments Inc. - Consorcio Siderurgia Amazonia Ltd. (Contd.)
On December 18, 1997 Amazonia was declared the winner with a bid for US$ 1,202,020,202, paid on January 27, 1998 with funds contributed by each consortium member in proportion to their participation (US$ 702,020,202) and bank financing obtained by the Consortium (US$ 500,000,000). For this reason Siderar S.A.I.C. made a capital contribution of US$ 122,853,535 for 17.5% of the capital of this company. The shares of Amazonia and those acquired from Sidor are pledged in guarantee of the mentioned loan and its subsequent refinancing. According to the terms of the share purchase agreement an audit of the financial statements of Sidor was performed at January 27, 1998, as a result of which on August 10, 1998 Corporación Venezolana de Guayana refunded to Amazonia the sum of US$ 150,000,000, the maximum amount payable under the contract as an adjustment to the bid value.
The share purchase agreement also established a series of conditions and obligations to be fulfilled over a five-year term. In guarantee of compliance with these conditions, a surety has been granted in favor of Fondo de Inversiones de Venezuela and Corporación Venezolana de Guayana for a total aggregate amount of US$ 150,000,000.
In relation to the commitments regarding minimum production volumes, minimum required levels of investment and the maintaining of a certain shareholding by the original bidders, a surety of US$ 150,000,000 has been established through financial institutions. The amount of this surety is reduced to US$ 125,000,000 and US$ 75,000,000 for the fourth and fifth years respectively as from the date of the purchase, as long as the creditor were not to have demanded enforcement of the guarantee in the immediately preceding year. The maximum amount guaranteed by Siderar at the date of these financial statements is US$ 26,250,000.
As from the date of payment, Siderar has acted as guarantor of financial liabilities entered into by Sidor for US$ 640,670,209, with due dates through to 2007. On the basis of its participation in the company, the maximum amount guaranteed by Siderar in relation to these liabilities is US$ 122,200,000
On June 30, 1998, Prosid Investments Inc. (Prosid) was incorporated in the British Virgin Islands with a capital of US$ 50,000 for the purpose of making financial investments of all kinds and any other activity permitted under the laws of the British Virgin Islands. On
NOTE 7 - INVESTMENTS IN OTHER COMPANIES (Contd.)
b) Prosid Investments Inc. - Consorcio Siderurgia Amazonia Ltd. (Contd.)
November 11, 1998 the procedures were completed for the transfer of the shares of Amazonia to Prosid for a value of US$ 122,626,393, equivalent to the equity value of the shares contributed, the capital of the latter company being increased to US$ 120,000,000, the balance of US$ 2,626,393 corresponding to the capital surplus account. As a result, the participation of the Company in Amazonia is indirect through its wholly-owned subsidiary Prosid.
In view of the negative economic context, Sidor and Amazonia recorded adverse economic results that led to arrears in compliance with their financial obligations.
On February 24, 2000 negotiations were completed for the restructuring of the liabilities of Sidor and Amazonia. The most relevant aspects of the agreements have been the contribution of resources by the shareholders of Sidor for US$ 300,000,000 and the obtaining of two years grace for the start of repayment of the restructured liabilities. In the context of these agreements, Sidor agreed to assign in trust part of its fixed assets, assigning its creditors as beneficiaries up to a total amount of US$ 827,000,000.
The partners in Amazonia, with the exception of Sivensa, assumed a repurchase commitment under certain conditions, to take place in 2007, for a maximum of US$ 25,000,000 of Amazonia’s debt above the excess of US$ 100,000,000 in debt that the latter were to maintain at that date with the financial entities participating in the restructuring. The participation of Siderar in the repurchase commitment amounts to US$ 6,000,000.
Under the terms of the mentioned agreements Siderar made contributions to Prosid for US$ 57,212,262 by means of the transfer of credits it held due from Sidor and Amazonia, increasing the capital of Prosid by US$ 32,000,000 and charging the difference with the mentioned contribution to the capital surplus account. In March 2000, Prosid made contributions in Amazonia for US$ 56,156,707, US$ 25,392,703 as a capital contribution and US$ 30,764,004 as loans convertible into shares.
As a result of these changes, the shareholding of Prosid in Amazonia at the date of these financial statements is 29,831,335 shares, representing 19.76% of the capital stock. Based on the assumption that the contributions made to Amazonia in the form of convertible loans will be fully capitalized in two years by the contributing partners, Prosid’s participation would increase to 21.13%.
NOTE 7 - INVESTMENTS IN OTHER COMPANIES (Contd.)
c) Compañía Afianzadora de Empresas Siderúrgicas S.G.R.
The Company has a 39.0539% interest in the capital stock of Compañía Afianzadora de Empresas Siderúrgicas S.G.R. in its capacity as protecting partner. The main purpose of this company is to grant guarantees to participating partners to facilitate or enable their access to the bank credit line for the purchase of national steel raw material and to provide technical, economic and financial advice to them. To do so, the Company has made a net contribution of $ 25,396,270 to the risk fund (see Exhibit D to the financial statements). The purpose of the risk fund is to realize guarantees to be granted to participating partners.
d) Ecocemento S.A.
On September 16, 1996 the Company and Compañía Argentina de Cemento Portland S.A. formed Ecocemento S.A., the purpose of which is the production and sale of blast furnace slag Portland cement, lime and related products. The shareholding is 15%, represented by 1,800 Class "B" shares of one vote and one peso par value each. Until the end of the period the Company had made contributions for $ 2,848,547. On March 1999, Ecocemento S.A. inaugurated its industrial plant.
e) Result from investments in subsidiaries and related companies:
| 9.30.00 | 9.30.99 | |
| $ | $ | |
| Subsidiaries | ||
| e.1.) Participation in the results of subsidiaries | ||
| Comesi San Luis S.A.I.C. | 422,602 | 130,089 |
| Prosid Investments Inc. (See Note to Exhibit C) | (1,437,941) | (10,386,453) |
| e.2.) Inventory valuation adjustment | ||
| Comesi San Luis S.A.I.C. inventory valuation adjustment | 46,762 | 585,536 |
| (968,577) | (9,670,828) | |
| Related companies | ||
| Compañía Afianzadora de Empresas Siderúrgicas S.G.R. | (707) | 42,641 |
| Ecocemento S.A. | (77,513) | (128,875) |
| (78,220) | (86,234) | |
| (1,046,797) | (9,757,062) |
NOTE 8 - RESTRICTIONS ON THE DISTRIBUTION OF PROFITS
In compliance with the Corporations Law, the By-laws and Resolution No. 290/97 of the National Securities Commission, 5% of the profit for the year should be transferred to the Legal Reserve after absorbing the negative results unappropriated at the beginning of the year, until such Reserve reaches 20% of the restated capital.
NOTE 9 - GLOBAL PROGRAM FOR NEGOTIABLE CORPORATE BONDS
On exercising the mandate and authorization granted by the Shareholders' Ordinary and Extraordinary Meeting held on September 29, 1994, the Board of Directors approved the Offering Circular of the global program for the issue of Negotiable Corporate Bonds for US$ 250,000,000, which has been authorized by the National Securities Commission.
On July 31, 1998 a new tranche was issued for a total of US$ 110,000,000 with six-monthly maturities in January and July 2002 and 2003, at an interest rate of Libo plus a rising spread of 0.9%, 1.15% and 1.4% in the first three years, respectively. Interest will be payable quarterly.
Funds from this issue were used as follows:
| US$ | |
| Settlement of bank and financial debt | 109,130,000 |
| Corporate Bonds issuing expenses | 870,000 |
| Total issued | 110,000,000 |
The unused balance of the global program totals US$ 80,000,000.
NOTE 10 - COMMITTED INVESTMENTS
The Company has entered into agreements for future purchases of fixed assets for an amount of US$ 20,290,687.
NOTE 11 - STATUS OF CAPITAL
The status of capital at September 30, 2000 is $ 347,468,771, which has been subscribed, paid-in and registered at the Public Registry of Commerce.
The last capital increase amounting to $ 35,666,000 was approved by the Shareholders' Ordinary and Extraordinary Meeting held on December 29, 1994 and registered at the Public Registry of Commerce on November 7, 1995.
The shareholders' equity at the end of the period amounted to $ 647,248,506 and the capital stock outstanding at that date to $ 347,468,771. Accordingly, the proportional equity value for each share of 1 peso par value amounts to $ 1.86 (one peso and eighty six cents).
NOTE 12 - EVENTS SUBSEQUENT TO PERIOD-END
On October 6, 2000 the Ordinary Shareholders’ Meeting of the Company determined the release of the Reserve for Future Dividends in the amount of $ 11,176,688, which added to the profit for the year ended June 30, 2000 of $ 3,282,119, makes a total of $ 14,357,807, to be distributed as follows:
| $ | |
| To Legal Reserve | 159,056 |
| To Hnos. Agustín y Enrique Rocca Foundation | 300,000 |
| Cash dividends of 4% on all share capital | 13,898,751 |
| Total | 14,357,807 |
After September 30, 2000, no other events, situations or circumstances which are not publicly known have occurred, which affect or could significantly affect the Company's equity and financial position.
The report on limited review is issued as a separate document.
| 9.30.00 | 9.30.99 | |||||||||||||
| D e p r e c i a t i o n | ||||||||||||||
| Main account | Values at the beginning of the period | Increases | Decreases | Reclassification | Values at the end of the period | Accumulated at the beginning of the period | Deletions for the period | For the period (1) | Accumulated at the end of the period | Residual value | Residual value | |||
| $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | ||||
| Land | 22,961,059 | - | 57,293 | - | 22,903,766 | - | - | - | - | 22,903,766 | 22,961,059 | |||
| Industrial buildings and facilities | 759,904,579 | - | - | 11,111,555 | 771,016,134 | 326,546,844 | - | 14,377,005 | 340,923,849 | 430,092,285 | 413,900,148 | |||
| Machinery and equipment | 378,926,299 | - | - | 1,133,062 | 380,059,361 | 266,491,626 | - | 4,935,247 | 271,426,873 | 108,632,488 | 118,836,513 | |||
| Vehicles and means of transport | 14,248,685 | 77,678 | 141,975 | - | 14,184,388 | 9,957,549 | 96,903 | 282,074 | 10,142,720 | 4,041,668 | 4,740,138 | |||
| Furniture, general machinery and office supplies | 16,921,776 | - | - | - | 16,921,776 | 13,964,178 | - | 241,939 | 14,206,117 | 2,715,659 | 3,681,331 | |||
| Steel spares and supplies | 63,047,602 | 3,288,491 | - | - | 66,336,093 | - | - | - | - | 66,336,093 | 75,022,196 | |||
| Fixed assets in transit | 776,529 | 105,260 | - | - | 881,789 | - | - | - | - | 881,789 | 2,717,146 | |||
| Work in progress | 60,730,342 | 13,217,872 | - | (12,244,617) | 61,703,597 | - | - | - | - | 61,703,597 | 91,543,673 | |||
| Advances to suppliers | 4,200,697 | 1,173,123 | - | - | 5,373,820 | - | - | - | - | 5,373,820 | 2,394,079 | |||
| Total at September 30, 2000 | 1,321,717,568 | 17,862,424 | 199,268 | - | 1,339,380,724 | 616,960,197 | 96,903 | 19,836,265 | 636,699,559 | 702,681,165 | ||||
| Total at September 30, 1999 | 1,288,745,508 | 6,596,125 | 2,234,902 | - | 1,293,106,731 | 538,547,719 | 112,883 | 18,875,612 | 557,310,448 | 735,796,283 |
(1) See Exhibit H to the financial statements.
Note: The Company has considered as original value of technically appraised assets at June 30, 1990 the technical value restated as
indicated in Note 2.2. The depreciation rates of the different assets are not included as these vary according to the
different remaining useful lives assigned.
The report on limited review is issued as a separate document.
| 9.30.00 | 9.30.99 | |||||||||
| A m o r t i z a t i o n | ||||||||||
| Main account | Balance at the beginning of the period | Increases | Decreases | Balance at the end of the period | Accumulated at the beginning of the period | Deletion for the period | For the period (1) | Accumulated at the end of the period | Residual value | Residual value |
| $ | $ | $ | $ | $ | $ | $ | $ | $ | $ | |
| Reorganization plant and project analysis related costs | 44,691,428 | - | - | 44,691,428 | 44,691,428 | - | - | 44,691,428 | - | 152,778 |
| Goodwill (Comesi S.A.I.C.) | 21,843,233 | - | - | 21,843,233 | 18,096,485 | - | 535,250 | 18,631,735 | 3,211,498 | 5,352,497 |
| Total at September 30, 2000 | 66,534,661 | - | - | 66,534,661 | 62,787,913 | - | 535,250 | 63,323,163 | 3,211,498 | |
| Total at September 30, 1999 | 66,534,661 | - | - | 66,534,661 | 60,402,470 | - | 626,916 | 61,029,386 | 5,505,275 |
(1) See Exhibit H to the financial statements.
The report on limited review is issued as a separate document.
| Denomination and type of shares | Issuer | Class | Par value | Amount | Percentage participation in capital stock | Restated cost value | Proportional equity value | Amount recorded at 9.30.00 | Amount recorded at 9.30.99 |
| $ | $ | $ | $ | ||||||
| NON-CURRENT INVESTMENTS | |||||||||
| Corporations Sect. 33 - Law No. 19550 and amendments | |||||||||
| Subsidiaries | |||||||||
| Shares | Comesi San Luis S.A.I.C. | Ordinary, one vote each | 0.0001 | 1,089,000 | 99.0000 | 4,542,925 | 5,730,734 | 5,730,734 | 5,213,857 |
| Shares | Prosid Investments Inc. | Ordinary, one vote each | 1.0000 | 152,000,000 | 100.0000 | 179,838,655 | 98,102,678 | 98,102,678 | 60,161,294 |
| Related companies | |||||||||
| Shares | Compañía Afianzadora de Empresas Siderúrgicas S.G.R. | Ordinary, one vote each | 1.0000 | 355,000 | 39.0539 | 355,000 | 358,102 | 358,102 | 356,630 |
| Shares | Ecocemento S.A. | Ordinary, one vote each | 1.0000 | 1,800 | 15.0000 | 2,848,547 | 2,575,678 | 2,575,678 | 2,719,551 |
| Shares | FO.GA.BA. S.A.P.E.M. | Ordinary, one vote each | 1.0000 | 10,000 | 0.0031 | 10,000 | - | 10,000 | 10,000 |
| Others | |||||||||
| Comesi San Luis S.A.I.C. inventory valuation adjustment | - | (630,200) | (630,200) | (752,400) | |||||
| 187,595,127 | 106,136,992 | 106,146,992 | 67,708,932 |
| Information about the issuer | ||||||||
| Latest financial statements | ||||||||
| Denomination and type of shares | Issuer | Principal activity | Date | Period | Capital stock | Results | Shareholders’ equity | Date of approval by Board of Directors |
| $ | $ | $ | ||||||
| NON-CURRENT INVESTMENTS (Contd.) | ||||||||
| Corporations Sect. 33 - Law No. 19550 and amendments (Contd.) | ||||||||
| Subsidiaries | ||||||||
| Shares | Comesi San Luis S.A.I.C. | Production of cold or hot rolled, pre-painted, formed and skelped steel sheets | 9.30.00 | 3 months | 110 | 426,871 | 5,788,620 | 11. 2.00 |
| Shares | Prosid Investments Inc. (1) | Financial investments of any type and any other activity permitted by laws applicable in British Virgin Islands | 9.30.00 | 3 months | 152,000,000 | (1,437,941) | 98,102,678 | 10.27.00 |
| Related companies | ||||||||
| Shares | Compañía Afianzadora de Empresas Siderúrgicas S.G.R. | Granting of guarantees to participating partners to facilitate or permit access to credits for the purchase of national steel raw material through the signing of contracts regulated by Law No. 24467 | 6.30.00 | 12 months | 909,000 | 3,769 | 27,501,132 | 10. 9.00 |
| Shares | Ecocemento S.A. | Production and sale of Portland cement with blast furnace slag, lime and by-products | 6.30.00 | 12 months | 12,000 | (959,153) | 17,171,184 | 8. 3.00 |
| Shares | FO.GA.BA. S.A.P.E.M. | Granting of guarantees to PYMES operating in the province of Buenos Aires | 12.31.99 | 12 months | 3,238,400 | 2,586,094 | 52,205,946 | 3.16.00 |
(1) The criterion of the Company has been to calculate the value of its investment in Amazonia on the basis of the financial statements of the latter with a lag of three months. Nevertheless, for a better reflection of the economic reality of these financial statements, the equity and results of the Company have been adjusted for the estimated effect of the results of Amazonia for the period July 1 to September 30, 2000.
The report on limited review is issued as a separate document.
| 9.30.00 | 9.30.99 | |||||
| Main account | Balance at the beginning of the period | Increases | Decreases | Balance at the end of the period | Balance at the end of the period | |
| $ | $ | $ | $ | $ | ||
| OTHER CURRENT INVESTMENTS | ||||||
| Sight deposits | 229,507 | 474,820 | - | 704,327 | 13,053,450 | |
| Time deposits | - | - | - | - | 12,815,528 | |
| Total at the end of the period | 229,507 | 474,820 | - | 704,327 | 25,868,978 | |
| OTHER NON-CURRENT INVESTMENTS | ||||||
| Financial investments in insurance companies | 5,859,062 | 1,102,793 | - | 6,961,855 | 5,279,020 | |
| Risk fund Compañía Afianzadora de Empresas Siderúrgicas S.G.R. | ||||||
| Net contributions | 25,396,270 | - | - | 25,396,270 | 36,000,000 | |
| Allowance for doubtful accounts (Exhibit E) (1) | (2,379,000) | - | - | (2,379,000) | (2,122,000) | |
| Real property | - | - | - | - | 98,229 | |
| Total at the end of the period | 28,876,332 | 1,102,793 | - | 29,979,125 | 39,255,249 |
- Customers of Compañía Afianzadora de Empresas Siderúrgicas S.G.R. in collection process.
The report on limited review is issued as a separate document.
| Items | Balance at the beginning of the period | Increases and recoveries (1) | Uses | Balance at the end of the period |
| $ | $ | $ | $ | |
| Deducted from current assets | ||||
| * For doubtful accounts | 6,853,096 | 585,000 | - | 7,438,096 |
| Total at 9.30.00 | 6,853,096 | 585,000 | - | 7,438,096 |
| Total at 9.30.99 | 8,567,166 | (940,362) | 2,074 | 7,624,730 |
| Deducted from non-current assets | ||||
| * For doubtful accounts | 1,859,000 | 1,215,000 | - | 3,074,000 |
| * For risk fund uncollectibility | 2,379,000 | - | - | 2,379,000 |
| Total at 9.30.00 | 4,238,000 | 1,215,000 | - | 5,453,000 |
| Total at 9.30.99 | 470,564 | 1,734,436 | - | 2,205,000 |
| Included in current liabilities | ||||
| * For contingencies | 3,153,834 | 45,346 | 302,667 | 2,896,513 |
| Total at 9.30.00 | 3,153,834 | 45,346 | 302,667 | 2,896,513 |
| Total at 9.30.99 | 3,135,616 | 81,163 | 86,825 | 3,129,954 |
| Included in non-current liabilities | ||||
| * For contingencies | 12,865,315 | 488,652 | - | 13,353,967 |
| Total at 9.30.00 | 12,865,315 | 488,652 | - | 13,353,967 |
| Total at 9.30.99 | 13,640,080 | (10,660) | - | 13,629,420 |
- See Exhibit H to the financial statements.
The report on limited review is issued as a separate document.
| 9.30.00 | 9.30.99 | |||
| $ | $ | $ | $ | |
| 1) Inventory at the beginning of the period | ||||
| Finished products | 71,991,895 | 97,421,969 | ||
| Production in process | 52,330,557 | 61,517,796 | ||
| Raw material | 49,490,562 | 35,012,397 | ||
| Materials | 59,931,616 | 61,600,587 | ||
| Advances to suppliers | 1,328,226 | 235,072,856 | 1,943,953 | 257,496,702 |
| 2) Purchases of the period | 90,929,015 | 84,194,281 | ||
| 3) Manufacturing expenses (Exhibit H) | 94,695,887 | 97,085,947 | ||
| Subtotal | 420,697,758 | 438,776,930 | ||
| 4) Holding results (Exhibit H) | (220,874) | (3,695,636) | ||
| Subtotal | 420,476,884 | 435,081,294 | ||
| 5) Inventory at the end of the period | ||||
| Finished products | 79,577,352 | 83,199,489 | ||
| Products in process | 55,650,206 | 55,241,865 | ||
| Raw material | 53,453,840 | 36,859,569 | ||
| Materials | 56,040,343 | 60,514,628 | ||
| Advances to suppliers | 1,640,705 | 246,362,446 | 2,239,245 | 238,054,796 |
| Cost of sales | 174,114,438 | 197,026,498 |
The report on limited review is issued as a separate document.
| 9.30.00 | 9.30.99 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Items | Foreign currency (1) | Amount in foreign currency | Exchange rate used | Amount in local currency | Foreign currency (1) | Amount in foreign currency | Amount in local currency | |||||
| $ | $ | $ | ||||||||||
| ASSETS | ||||||||||||
| CURRENT ASSETS | ||||||||||||
| Cash and banks | ||||||||||||
| Cash | US$ | 17,569 | 1.000000 | 17,569 | US$ | 23,250 | 23,250 | |||||
| Checks to be deposited | US$ | 23,426 | 1.000000 | 23,426 | 125,618 | 125,618 | ||||||
| Banks | US$ | 12,367 | 1.000000 | 12,367 | US$ | 10,786 | 10,786 | |||||
| Other investments | ||||||||||||
| Sight deposits | US$ | 51,727 | 1.000000 | 51,727 | US$ | 13,053,450 | 13,053,450 | |||||
| Time deposits | - | - | - | - | US$ | 12,815,528 | 12,815,528 | |||||
| Trade receivables | ||||||||||||
| Accounts receivable | US$ | 111,522,102 | 1.000000 | 111,522,102 | US$ | 108,839,622 | 108,839,622 | |||||
| Related companies Sect. 33 - Law No. 19550 and amendments | US$ | 2,146,236 | 1.000000 | 2,146,236 | US$ | 1,317,956 | 1,317,956 | |||||
| Export reimbursements | US$ | 3,580,690 | 1.000000 | 3,580,690 | US$ | 3,880,796 | 3,880,796 | |||||
| Notes receivable | US$ | 50,678,865 | 1.000000 | 50,678,865 | US$ | 46,727,103 | 46,727,103 | |||||
| EURO | 560,005 | 0.882900 | 494,428 | - | - | - | ||||||
| Receivables with exchange insurance in US$ | EURO | 2,990,534 | 0.903583 | 2,702,196 | - | - | - | |||||
| Allowance for doubtful accounts (Exhibit E) | US$ | (7,438,096) | 1.000000 | (7,438,096) | US$ | (7,624,730) | (7,624,730) | |||||
| Unearned interest | US$ | (1,418,574) | 1.000000 | (1,418,574) | US$ | (1,747,042) | (1,747,042) | |||||
| Other receivables | ||||||||||||
| Related companies Sect. 33 - Law No. 19550 and amendments | US$ | 3,707,960 | 1.000000 | 3,707,960 | US$ | 9,688,418 | 9,688,418 | |||||
| Receivables from sale of real property | US$ | 215,527 | 1.000000 | 215,527 | US$ | 248,156 | 248,156 | |||||
| Advances to suppliers | - | - | - | - | US$ | 486,167 | 486,167 | |||||
| Expenses paid in advance | US$ | 2,101,242 | 1.000000 | 2,101,242 | US$ | 2,135,659 | 2,135,659 | |||||
| Sundry receivables | US$ | 4,655,839 | 1.000000 | 4,655,839 | US$ | 3,708,731 | 3,708,731 | |||||
| Total current assets - Carried forward | 173,053,504 | 193,689,468 |
| 9.30.00 | 9.30.99 | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Items | Foreign currency (1) | Amount in foreign currency | Exchange rate used | Amount in local currency | Foreign currency (1) | Amount in foreign currency | Amount in local currency | ||||||
| $ | $ | $ | |||||||||||
| ASSETS | |||||||||||||
| Brought forward | 173,053,504 | 193,689,468 | |||||||||||
| NON-CURRENT ASSETS | |||||||||||||
| Trade receivables | |||||||||||||
| Notes receivable | US$ | 7,495,314 | 1.000000 | 7,495,314 | US$ | 1,036,144 | 1,036,144 | ||||||
| Allowance for doubtful accounts (Exhibit E) | US$ | (3,074,000) | 1.000000 | (3,074,000) | US$ | (83,000) | (83,000) | ||||||
| Other receivables | |||||||||||||
| Related companies Sect. 33 - Law No. 19550 and amendments | US$ | 1,720,760 | 1.000000 | 1,720,760 | - | - | - | ||||||
| Receivables from sale of real property | US$ | 565,014 | 1.000000 | 565,014 | US$ | 770,964 | 770,964 | ||||||
| Financial credits | - | - | - | - | US$ | 14,915,064 | 14,915,064 | ||||||
| Expenses paid in advance | US$ | 1,794,066 | 1.000000 | 1,794,066 | US$ | 3,140,806 | 3,140,806 | ||||||
| Sundry receivables | US$ | 258,114 | 1.000000 | 258,114 | US$ | 153,207 | 153,207 | ||||||
| Other investments | |||||||||||||
| Investments in insurance companies | US$ | 6,961,855 | 1.000000 | 6,961,855 | US$ | 5,279,020 | 5,279,020 | ||||||
| Risk fund Compañía Afianzadora de Empresas Siderúrgicas S.G.R. | |||||||||||||
| Net contributions | US$ | 25,396,270 | 1.000000 | 25,396,270 | US$ | 36,000,000 | 36,000,000 | ||||||
| Allowance for doubtful accounts (Exhibit E) | US$ | (2,379,000) | 1.000000 | (2,379,000) | US$ | (2,122,000) | (2,122,000) | ||||||
| Fixed assets | |||||||||||||
| Advances to suppliers | US$ | 949,646 | 1.000000 | 949,646 | US$ | 855,603 | 855,603 | ||||||
| DM | 282,175 | 0.451224 | 127,324 | DM | 243,853 | 132,824 | |||||||
| Lit | 286,752,193 | 0.000456 | 130,759 | Lit | 1,133,945,455 | 623,670 | |||||||
| FF | 1,077,656 | 0.134400 | 144,837 | FF | 883,990 | 143,446 | |||||||
| EURO | 1,638,287 | 0.882900 | 1,446,444 | ||||||||||
| £ | 962 | 1.475500 | 1,420 | ||||||||||
| FB | 1,909,428 | 50,407 | |||||||||||
| Total non-current assets | 41,538,823 | 60,896,155 | |||||||||||
| Total assets | 214,592,327 | 254,585,623 |
| 9.30.00 | 9.30.99 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Items | Foreign currency (1) | Amount in foreign currency | Exchange rate used | Amount in local currency | Foreign currency (1) | Amount in foreign currency | Amount in local currency | |||||
| $ | $ | $ | ||||||||||
| LIABILITIES | ||||||||||||
| CURRENT LIABILITIES | ||||||||||||
| Accounts payable | ||||||||||||
| Ordinary suppliers | US$ | 5,259,972 | 1.000000 | 5,529,972 | US$ | 2,707,451 | 2,707,451 | |||||
| Related companies Sect. 33 - Law No. 19550 and amendments | US$ | 2,167,969 | 1.000000 | 2,167,969 | US$ | 1,990,957 | 1,990,957 | |||||
| Notes payable | US$ | 52,124,255 | 1.000000 | 52,124,255 | US$ | 34,001,554 | 34,001,554 | |||||
| Lit | 3,615,721 | 0.000458 | 1,656 | Lit | 234,123,188 | 129,236 | ||||||
| DM | 1,538,086 | 0.452677 | 696,256 | DM | 1,847,700 | 1,009,478 | ||||||
| £ | 102,016 | 1.479000 | 150,881 | £ | 49,147 | 80,974 | ||||||
| Pt | 5,445,301 | 0.005320 | 28,969 | - | - | - | ||||||
| Skr | 370,505 | 0.104703 | 38,793 | Skr | 370,502 | 45,780 | ||||||
| FB | 2,042,122 | 0.021984 | 44,894 | - | - | - | ||||||
| EURO | 73,582 | 0.884300 | 65,069 | EURO | 27,096 | 28,844 | ||||||
| ¥ | 720,898 | 0.009269 | 6,682 | ¥ | 554,081 | 5,220 | ||||||
| - | - | - | - | FF | 302,104 | 49,362 | ||||||
| - | - | - | - | S | 1,665,874 | 129,650 | ||||||
| Unearned interest | US$ | (1,022,033) | 1.000000 | (1,022,033) | US$ | (1,370,683) | (1,370,683) | |||||
| Advances from customers | US$ | 1,676,873 | 1.000000 | 1,676,873 | US$ | 2,786,608 | 2,786,608 | |||||
| Short-term debt | ||||||||||||
| Import/export financing | US$ | 71,870,329 | 1.000000 | 71,870,329 | US$ | 150,107,155 | 150,107,155 | |||||
| ¥ | 48,556,134 | 0.009415 | 457,156 | ¥ | 26,163,040 | 246,482 | ||||||
| DM | 62,431 | 0.452677 | 28,261 | DM | 57,070 | 31,180 | ||||||
| EURO | 794,133 | 0.884300 | 702,252 | - | - | - | ||||||
| Debt with exchange insurance in US$ | ¥ | 15,834,936,718 | 0.009671 | 153,139,673 | ¥ | 7,651,704,435 | 64,358,486 | |||||
| - | - | - | - | DM | 340,655 | 242,978 | ||||||
| - | - | - | - | EURO | 21,043,350 | 22,425,603 | ||||||
| Unearned interest | US$ | (21,431,953) | 1.000000 | (21,431,953) | US$ | (16,791,730) | (16,791,730) | |||||
| ¥ | (3,235,343) | 0.009671 | (31,289) | ¥ | (21,178,856) | (199,526) | ||||||
| EURO | (103,559) | 0.884300 | (91,577) | - | - | - | ||||||
| Unearned interest with exchange insurance in US$ | ¥ | (65,332,230) | 0.009671 | (631,828) | ¥ | (134,092,242) | (1,133,884) | |||||
| - | - | - | - | EURO | (1,043,344) | (1,111,877) | ||||||
| Total current liabilities - Carried forward | 265,251,260 | 259,769,298 |
| 9.30.00 | 9.30.99 | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Items | Foreign currency (1) | Amount in foreign currency | Exchange rate used | Amount in local currency | Foreign currency (1) | Amount in foreign currency | Amount in local currency | |||||
| $ | $ | $ | ||||||||||
| LIABILITIES | ||||||||||||
| Brought forward | 265,251,260 | 259,769,298 | ||||||||||
| NON-CURRENT LIABILITIES | ||||||||||||
| Accounts payable | ||||||||||||
| Notes payable | US$ | 10,588,426 | 1.000000 | 10,588,426 | US$ | 13,730,088 | 13,730,088 | |||||
| Unearned interest | US$ | (1,118,284) | 1.000000 | (1,118,284) | US$ | (1,807,428) | (1,807,428) | |||||
| Long-term debt | ||||||||||||
| Import/export financing | US$ | 191,294,597 | 1.000000 | 191,294,597 | US$ | 221,713,521 | 221,713,521 | |||||
| ¥ | 262,558,097 | 0.009269 | 2,433,651 | ¥ | 49,269,186 | 464,165 | ||||||
| DM | 159,496 | 0.452677 | 72,200 | DM | 228,274 | 124,716 | ||||||
| EURO | 2,891,986 | 0.884300 | 2,557,383 | - | - | - | ||||||
| Debt with exchange insurance in US$ | ¥ | 3,760,210,521 | 0.009448 | 35,526,469 | ¥ | 7,042,253,521 | 60,000,000 | |||||
| Negotiable Corporate Bonds | US$ | 110,000,000 | 1.000000 | 110,000,000 | US$ | 110,000,000 | 110,000,000 | |||||
| Unearned interest | US$ | (26,306,646) | 1.000000 | (26,306,646) | US$ | (43,408,231) | (43,408,231) | |||||
| EURO | (238,409) | 0.884300 | (210,825) | - | - | - | ||||||
| ¥ | (262,558,097) | 0.009269 | (2,433,651) | ¥ | (49,269,186) | (464,165) | ||||||
| Unearned interest with exchange insurance in US$ | ¥ | (55,722,798) | 0.009448 | (526,469) | - | - | - | |||||
| Total non-current liabilities | 321,876,851 | 360,352,666 | ||||||||||
| Total liabilities | 587,128,111 | 620,121,964 |
(1) US$: United States Dollars; S: Austrian Schillings; Lit: Italian Lire; £: Pounds Sterling; DM: Deutsche Marks; FF: French
Francs; ¥: Yens; FB: Belgian Francs; Pt: Pesetas; Skr: Swedish Kronor.
The report on limited review is issued as a separate document.
| Financial and holding results | Total for the period-ended | |||||||
|---|---|---|---|---|---|---|---|---|
| Items | Manufacturing expenses | Selling expenses | Administrative expenses | Generated by assets | Generated by liabilities | Other income and expenses | 9.30.00 | 9.30.99 |
| $ | $ | $ | $ | $ | $ | $ | $ | |
| Surveillance Committee's and Directors' fees | - | - | 279,000 | - | - | - | 279,000 | 308,000 |
| Salaries, wages and social security | 32,132,695 | 2,583,000 | 9,094,329 | - | - | - | 43,810,024 | 44,090,171 |
| Office expenses | 418,806 | 166,390 | 618,980 | - | - | - | 1,204,176 | 1,192,614 |
| Maintenance expenses and security services for buildings, installation and equipment | 19,132,364 | 4,059 | 775,682 | - | - | - | 19,912,105 | 18,749,031 |
| Fees for technical assistance and external advice | 249,746 | 121,287 | 423,426 | - | - | - | 794,459 | 634,938 |
| Taxes, tariffs and contributions | 6,798 | 12,066 | 1,536,454 | - | - | - | 1,555,318 | 1,492,097 |
| Third party services | 15,357,334 | 63,487 | 2,163,491 | - | - | - | 17,584,312 | 18,606,735 |
| Operating IT services | - | - | 1,626,385 | - | - | - | 1,626,385 | 1,758,000 |
| Canteen and refreshment | 671,792 | 18,756 | 30,787 | - | - | - | 721,335 | 842,781 |
| Rents | 57,603 | 647 | 47,587 | - | - | - | 105,837 | 105,324 |
| Personnel transportation | 682,618 | - | 45,205 | - | - | - | 727,823 | 822,745 |
| Publicity and advertising | 46,544 | 155,233 | 94,417 | - | - | - | 296,194 | 425,160 |
| Sundry expenses and commissions | - | 1,398,206 | - | - | - | - | 1,398,206 | 660,633 |
| Charge for provision for contingencies | - | - | - | - | - | 533,998 | 533,998 | 70,503 |
| Charge for allowance for doubtful accounts | - | 1,800,000 | - | - | - | - | 1,800,000 | 794,074 |
| Freight and transportation | 5,269,088 | 1,206,560 | 4,410 | - | - | - | 6,480,058 | 7,841,427 |
| Major work not capitalizable | 4,241,968 | - | - | - | - | - | 4,241,968 | 3,933,132 |
| Depreciation of other assets | - | - | - | - | - | 16,575 | 16,575 | 13,118 |
| Amortization of intangible assets | - | - | - | - | - | 535,250 | 535,250 | 626,916 |
| Depreciation of fixed assets | 19,836,265 | - | - | - | - | - | 19,836,265 | 18,875,612 |
| Recovery from sale of scrap | (5,460,781) | - | - | - | - | - | (5,460,781) | (5,224,052) |
| External warehouse expenses | 37,324 | - | - | - | - | - | 37,324 | 446,944 |
| Other ordinary income and expenses | 2,015,723 | 449,607 | 1,801,689 | - | - | 1,906,276 | 6,173,295 | 11,222,002 |
| Interests and other financing expenses | - | - | - | (4,401,988) | 14,422,877 | - | 10,020,889 | 5,502,254 |
| Exchange differences | - | - | - | 114,587 | (345,001) | - | (230,414) | 38,052 |
| Holding results on other non-monetary assets | - | - | - | 220,874 | - | 220,874 | 3,695,636 | |
| Total at September 30, 2000 | 94,695,887 | 7,979,298 | 18,541,842 | (4,066,527) | 14,077,876 | 2,992,099 | 134,220,475 | |
| Total at September 30, 1999 | 97,085,947 | 7,553,343 | 18,850,260 | (1,439,269) | 10,675,211 | 4,798,355 | 137,523,847 |
The report on limited review is issued as a separate document.
| Sales and sundry services | Purchases and services received | Remuneration protector partner Compañía Afianzadora de Empresas Siderúrgicas S.G.R. | Interests | Total at 9.30.00 | Total at 9.30.99 | |
| $ | $ | $ | $ | $ | $ | |
| Subsidiaries | ||||||
| Comesi San Luis S.A.I.C. | 3,448,388 | (127,881) | - | - | 3,320,507 | 1,403,196 |
| Subtotal | 3,448,388 | (127,881) | - | - | 3,320,507 | 1,403,196 |
| Related companies | ||||||
| Siderca S.A.I.C. | 409,930 | (1,171,307) | - | - | (761,377) | 7,319,318 |
| Compañía Afianzadora de Empresas Siderúrgicas S.G.R. | - | - | 454,521 | - | 454,521 | 720,156 |
| Ecocemento S.A. | 135,815 | - | - | - | 135,815 | 180,191 |
| Inversora Siderúrgica Argentina S.A. | - | - | - | - | - | 32,137 |
| Consorcio Siderurgia Amazonia Ltda. | 286,300 | - | - | - | 286,300 | 563,650 |
| Subtotal | 832,045 | (1,171,307) | 454,521 | - | 115,259 | 8,815,452 |
| Total at September 30, 2000 | 4,280,433 | (1,299,188) | 454,521 | - | 3,435,766 | |
| Total at September 30, 1999 | 10,408,520 | (817,165) | 595,156 | 32,137 | 10,218,648 |
Amounts in brackets represent losses or disbursements.
The report on limited review is issued as a separate document.
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
Legal address: Leandro N. Alem 1067, Buenos Aires
COMPLEMENTARY ACCOUNTING INFORMATION
CONSOLIDATED FINANCIAL STATEMENTS FOR
THE THREE-MONTH PERIOD ENDED SEPTEMBER 30, 2000
CONTENTS
Consolidated financial statements at September 30, 2000
Consolidated balance sheet
Consolidated statement of income
Consolidated statement of sources and uses of funds
Notes to the consolidated financial statements
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
Registration number with the Superintendency of Corporations: 14510
CONSOLIDATED BALANCE SHEET at September 30, 2000, compared to the same period of the previous year
| 9.30.00 | 9.30.99 | 9.30.00 | 9.30.99 | |||
| $ | $ | $ | $ | |||
| ASSETS | LIABILITIES | |||||
| CURRENT ASSETS | CURRENT LIABILITIES | |||||
| Cash and banks (Note 5.a)) | 5,792,163 | 6,254,493 | Accounts payable (Note 5.n)) | 107,502,549 | 88,109,693 | |
| Other investments (Note 5.b)) | 1,710,206 | 25,873,246 | Short-term debt (Note 5.o)) | 204,796,342 | 218,246,237 | |
| Trade receivables (Note 5.c)) | 191,027,931 | 178,533,472 | Social security and taxes (Note 5.p)) | 38,937,630 | 41,737,126 | |
| Other receivables (Note 5.d)) | 37,103,218 | 45,134,822 | Other liabilities (Note 5.q)) | 4,385,338 | 16,265,385 | |
| Inventories (Note 5.e)) | 247,340,052 | 239,104,721 | Provisions for contingencies | 2,911,513 | 3,169,409 | |
| Other assets (Note 5.f)) | 2,113,826 | 1,603,771 | ||||
| Total current assets | 485,087,396 | 496,504,525 | Total current liabilities | 358,533,372 | 367,527,850 | |
| NON-CURRENT ASSETS | NON-CURRENT LIABILITIES | |||||
| Trade receivables (Note 5.g)) | 4,421,314 | 953,144 | Accounts payable (Note 5.r)) | 9,470,142 | 11,922,660 | |
| Other receivables (Note 5.h)) | 15,423,347 | 26,148,468 | Long-term debt (Note 5.s)) | 312,406,709 | 348,430,006 | |
| Investments (Note 5.i)) | 67,589,024 | 63,247,475 | Social security and taxes (Note 5.t)) | 3,565,912 | 4,302,048 | |
| Other investments (Note 5.j)) | 63,436,559 | 39,255,249 | Other liabilities | 303,540 | 362,174 | |
| Intangible assets (Note 5.k)) | 3,211,498 | 5,505,275 | Provisions for contingencies | 13,353,967 | 13,629,420 | |
| Fixed assets (Note 5.l)) | 703,923,324 | 737,073,188 | ||||
| Other assets (Note 5.m)) | 1,847,572 | 3,321,650 | ||||
| Total non-current assets | 859,852,638 | 875,504,449 | Total non-current liabilities | 339,100,270 | 378,646,308 | |
| Total liabilities | 697,633,642 | 746,174,158 | ||||
| MINORITY INTEREST IN SUBSIDIARIES | 57,886 | 52,665 | ||||
| SHAREHOLDERS' EQUITY | 647,248,506 | 625,782,151 | ||||
| Total assets | 1,344,940,034 | 1,372,008,974 | Total liabilities and Shareholders' equity | 1,344,940,034 | 1,372,008,974 |
The accompanying notes 1 to 5 are an integral part of these consolidated financial statements.
The report on limited review is issued as a separate document.
SIDERAR SOCIEDAD ANONIMA INDUSTRIAL Y COMERCIAL
Registration number with the Superintendency of Corporations: 14510
CONSOLIDATED STATEMENT OF INCOME for the three-month period ended September 30, 2000, compared to the same period of the previous year
| 9.30.00 | 9.30.99 | |
| $ | $ | |
| Net income from sales | 233,828,009 | 241,890,403 |
| Cost of sales | (174,002,870) | (197,190,176) |
| Gross profit | 59,825,139 | 44,700,227 |
| Selling expenses | (8,058,117) | (7,573,507) |
| Administrative expenses | (18,581,131) | (18,886,733) |
| Financial and holding results | ||
| Generated by assets | 5,321,008 | 1,485,522 |
| Generated by liabilities | (14,088,460) | (10,705,106) |
| Other ordinary income and expenses | (2,992,108) | (4,798,630) |
| Minority interest in subsidiaries | (4,269) | (1,314) |
| Income before taxes | 21,422,062 | 4,220,459 |
| Income tax provision charge | (6,991,325) | (307,376) |
| Ordinary income | 14,430,737 | 3,913,083 |
| Result from investments in related companies | (2,705,105) | (10,472,687) |
| Net income (loss) for the period | 11,725,632 | (6,559,604) |
The accompanying notes 1 to 5 are an integral part of these consolidated financial statements.
The report on limited review is issued as a separate document.
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| CHANGES IN FUNDS | ||
| Funds at the beginning of the period (1) | 9,644,129 | 21,121,695 |
| (Decrease) increase in funds | (2,141,760) | 11,006,044 |
| Funds at the end of the period (1) | 7,502,369 | 32,127,739 |
| CAUSES OF CHANGES IN FUNDS | ||
| Ordinary income | 14,430,737 | 3,913,083 |
| Add: Items not representing funds disbursements | ||
| Depreciation of fixed assets | 19,844,891 | 18,884,399 |
| Depreciation of other current assets | 16,575 | 13,118 |
| Amortization of intangible assets | 535,250 | 626,916 |
| Allowance for doubtful accounts | 1,800,000 | 794,074 |
| Income tax provision charge | 6,991,325 | 307,376 |
| Board of Directors’ and Surveillance Committee’s fees provision | 279,000 | 308,000 |
| Provision for contingencies | 533,998 | 70,503 |
| Minority interest in subsidiaries | 4,269 | 1,314 |
| Funds generated by ordinary operations | 44,436,045 | 24,918,783 |
| Results of investments in related companies | (2,705,105) | (10,472,687) |
| Add: Items not representing funds disbursements | ||
| Results of investments in related companies | 2,705,105 | 10,472,687 |
| Funds generated by (applied to) remaining operations | - | - |
| Funds generated by operations | 44,436,045 | 24,918,783 |
| Other causes of sources of funds | ||
| Net increase (decrease) in short and long-term debt | 1,163,016 | (5,591,952) |
| Total sources of funds - Carried forward | 45,599,061 | 19,326,831 |
(1) Cash and banks plus other current investments
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| CAUSES OF CHANGES IN FUNDS (Contd.) | ||
| Brought forward | 45,599,061 | 19,326,831 |
| Other causes of uses of funds | ||
| Net increase in trade receivables | (10,063,056) | (1,971,108) |
| Net increase in other receivable | (1,694,507) | (8,028,130) |
| Net (increase) decrease in inventories | (11,418,480) | 19,613,598 |
| Net (increase) decrease in other assets | (233,558) | 624,265 |
| Net increase in other non-current investments | (2,291,737) | (1,144,061) |
| Net increase in fixed assets | (17,760,059) | (4,474,106) |
| Net decrease in account payable | (1,610,073) | (16,802,180) |
| Net (decrease) increase in social security and taxes | (2,240,470) | 4,063,276 |
| Net decrease in other liabilities | (126,214) | (115,516) |
| Decrease in provision for contingencies | (302,667) | (86,825) |
| Total uses of funds | (47,740,821) | (8,320,787) |
| (Decrease) increase in funds | (2,141,760) | 11,006,044 |
The accompanying notes 1 to 5 are an integral part of these consolidated financial statements.
The report on limited review is issued as a separate document.
NOTE 1 - BASIS FOR THE PREPARATION OF THE CONSOLIDATED FINANCIAL STATEMENTS - ACCOUNTING STANDARDS
The consolidated financial statements have been prepared in accordance with the valuation basis and criteria explained in Notes 1 and 2 to the financial statements of the parent company and must be read jointly with the complementary information to the financial statements.
NOTE 2 - CONSOLIDATION BASIS
The consolidated companies and the respective percentage of voting stock at September 30, 2000 were as follows:
| Company | Participation |
| Comesi San Luis S.A.I.C. | 99.000% |
| Prosid Investments Inc. | 100.000% |
The consolidated financial statements have been prepared on the basis of the financial statements of the subsidiaries at September 30, 2000.
The necessary adjustments have been made to unify the valuation and disclosure criteria of the consolidated companies. Balances between consolidated companies, transactions and their results and intercompany balances have been eliminated, if significant.
NOTE 3 - COMPLEMENTARY INFORMATION NOT DIFFERING SIGNIFICANTLY FROM THAT PRESENTED BY THE PARENT COMPANY
Notes 1, 2, 4 to 12 and Exhibits A to I to the financial statements of the parent company are in this situation.
NOTE 4 - INCOME TAX - MINIMUM NOTIONAL INCOME TAX
The charge for income tax/minimum notional is that estimated to be paid according to current legislation for the following companies:
| $ | |
| Income tax Siderar S.A.I.C. | 6,980,000 |
| Minimum notional income tax Comesi San Luis S.A.I.C. | 11,325 |
| 6,991,325 |
NOTE 5 - COMPOSITION OF CONSOLIDATED BALANCE SHEET ITEMS
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| CURRENT ASSETS | ||
| a) Cash and banks | ||
| Cash | 197,148 | 201,226 |
| Checks to be deposited | 4,749,922 | 2,088,542 |
| Banks | 845,093 | 3,964,725 |
| 5,792,163 | 6,254,493 | |
| b) Other investments | ||
| Sight deposits | 1,710,206 | 13,057,718 |
| Time deposits | - | 12,815,528 |
| 1,710,206 | 25,873,246 | |
| c) Trade receivables | ||
| Accounts receivable | 113,330,207 | 110,114,883 |
| Related companies Sect. 33 - Law No. 19550 and amendments | 572,890 | 538,839 |
| Export reimbursements | 3,580,690 | 3,880,796 |
| Notes receivable | 82,460,599 | 73,430,511 |
| Allowance for doubtful accounts | (7,497,881) | (7,684,515) |
| Unearned interest | (1,418,574) | (1,747,042) |
| 191,027,931 | 178,533,472 |
NOTE 5 - COMPOSITION OF CONSOLIDATED BALANCE SHEET ITEMS (Contd.)
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| CURRENT ASSETS (Contd.) | ||
| d) Other receivables | ||
| Related companies Sect. 33 - Law No. 19550 and amendments | 3,707,960 | 9,688,418 |
| Advances and loans to personnel | 3,375,500 | 3,044,043 |
| Receivables from sale of real property | 445,399 | 457,157 |
| Tax credits | 19,803,244 | 21,686,053 |
| Advances to suppliers | 1,002,227 | 1,357,229 |
| Expenses paid in advance | 2,101,242 | 2,135,659 |
| Sundry receivables | 6,667,646 | 6,766,263 |
| 37,103,218 | 45,134,822 | |
| e) Inventories | ||
| Finished products | 80,231,009 | 83,788,052 |
| Products in process | 55,974,155 | 55,703,227 |
| Raw material | 53,453,840 | 36,859,569 |
| Materials | 56,040,343 | 60,514,628 |
| Advances to suppliers | 1,640,705 | 2,239,245 |
| 247,340,052 | 239,104,721 | |
| f) Other assets (residual value) | ||
| Property | 2,113,826 | 1,603,771 |
| 2,113,826 | 1,603,771 |
The amortization of the period amounted to $ 16,575.
| NON-CURRENT ASSETS | ||
| g) Trade receivables | ||
| Notes receivable | 7,495,314 | 1,036,144 |
| Allowance for doubtful accounts | (3,074,000) | (83,000) |
| 4,421,314 | 953,144 |
NOTE 5 - COMPOSITION OF CONSOLIDATED BALANCE SHEET ITEMS (Contd.)
| 9.30.00 | 9.30.99 | ||
|---|---|---|---|
| $ | $ | ||
| NON-CURRENT ASSETS (Contd.) | |||
| h) Other receivables | |||
| Related companies Sect. 33 - Law No. 19550 and amendments | 1,720,760 | - | |
| Advances and loans to personnel | 1,748,408 | 1,630,777 | |
| Receivables from sale of real property | 6,646,363 | 6,290,876 | |
| Tax credits | 3,241,503 | - | |
| Expenses paid in advance | 1,794,066 | 3,140,806 | |
| Financial credits | - | 14,915,064 | |
| Sundry receivables | 272,247 | 170,945 | |
| 15,423,347 | 26,148,468 | ||
| i) Investments | |||
| Shares in Consorcio Siderurgia Amazonia Ltd. | 64,645,244 | 60,161,294 | |
| Shares in Compañía Afianzadora de Empresas Siderúrgicas S.G.R. | 358,102 | 356,630 | |
| Shares in Ecocemento S.A. | 2,575,678 | 2,719,551 | |
| Shares in Fondo de Garantías Buenos Aires S.A.P.E.M. | 10,000 | 10,000 | |
| 67,589,024 | 63,247,475 | ||
| j) Other investments (residual value) | |||
| Loans convertible into shares in Consorcio Siderurgia Amazonia Ltd. | 33,457,434 | - | |
| Investments in insurance companies | 6,961,855 | 5,279,020 | |
| Guarantee fund Compañía Afianzadora de Empresas Siderúrgicas S.G.R. | 25,396,270 | 36,000,000 | |
| Allowance for risk fund uncollectibility | (2,379,000) | (2,122,000) | |
| Real estate | - | 98,229 | |
| 63,436,559 | 39,255,249 | ||
| k) Intangible assets (residual value) | |||
| Reorganization plant and project analysis related costs | - | 152,778 | |
| Goodwill (Comesi S.A.I.C.) | 3,211,498 | 5,352,497 | |
| 3,211,498 | 5,505,275 | ||
| The amortization of the period amounted to $ 535,250. |
NOTE 5 - COMPOSITION OF CONSOLIDATED BALANCE SHEET ITEMS (Contd.)
| 9.30.00 | 9.30.99 | |||
|---|---|---|---|---|
| $ | $ | |||
| NON-CURRENT ASSETS (Contd.) | ||||
| l) Fixed assets (residual value) | ||||
| Land | 22,997,714 | 23,055,007 | ||
| Industrial buildings and facilities | 431,233,006 | 415,072,884 | ||
| Machinery and equipment | 108,637,840 | 118,843,532 | ||
| Vehicles and means of transport | 4,041,668 | 4,740,138 | ||
| Furniture, general machinery and office supplies | 2,717,797 | 3,684,533 | ||
| Steel spares and supplies | 66,336,093 | 75,022,196 | ||
| Fixed assets in transit | 881,789 | 2,717,146 | ||
| Work in progress | 61,703,597 | 91,543,673 | ||
| Advances to suppliers | 5,373,820 | 2,394,079 | ||
| 703,923,324 | 737,073,188 | |||
| The depreciation of the period amounted to $ 19,844,991. | ||||
| m) Other assets | ||||
| Real property | 1,847,572 | 3,321,650 | ||
| 1,847,572 | 3,321,650 | |||
| CURRENT LIABILITIES | ||||
| n) Accounts payable | ||||
| Ordinary suppliers | 51,738,475 | 49,270,357 | ||
| Related companies Sect. 33 - Law No. 19550 and amendments | 1,944,288 | 1,932,879 | ||
| Notes payable | 53,157,455 | 35,480,098 | ||
| Unearned interest | (1,022,033) | (1,370,683) | ||
| Advances from customers | 1,684,364 | 2,797,042 | ||
| 107,502,549 | 88,109,693 |
NOTE 5 - COMPOSITION OF CONSOLIDATED BALANCE SHEET ITEMS (Contd.)
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| CURRENT LIABILITIES (Contd.) | ||
| o) Short-term debt | ||
| Financial | 785,318 | 71,370 |
| Import/export financing | 226,197,671 | 237,411,884 |
| Unearned interest | (22,186,647) | (19,237,017) |
| 204,796,342 | 218,246,237 | |
| p) Social security and taxes | ||
| Provision for income tax/minimum notional | 12,318,000 | 18,564,192 |
| Income tax withholding and solidarity contribution | (12,273,000) | (11,723,347) |
| Income tax advances | (19,601) | (6,817,661) |
| Provision for turnover tax | 123,804 | 296,283 |
| Wages and social security | 36,629,336 | 36,795,609 |
| Others sundry | 2,159,091 | 4,622,050 |
| 38,937,630 | 41,737,126 | |
| q) Other liabilities | ||
| Dividends payable | - | 13,898,751 |
| Sundry | 4,385,338 | 2,366,634 |
| 4,385,338 | 16,265,385 | |
| NON-CURRENT LIABILITIES | ||
| r) Accounts payable | ||
| Notes payable | 10,588,426 | 13,730,088 |
| Unearned interest | (1,118,284) | (1,807,428) |
| 9,470,142 | 11,922,660 | |
| s) Long-term debt | ||
| Import/export financing | 231,884,300 | 282,302,402 |
| Negotiable Corporate Bonds | 110,000,000 | 110,000,000 |
| Unearned interest | (29,477,591) | (43,872,396) |
| 312,406,709 | 348,430,006 |
NOTE 5 - COMPOSITION OF CONSOLIDATED BALANCE SHEET ITEMS (Contd.)
| 9.30.00 | 9.30.99 | |
|---|---|---|
| $ | $ | |
| NON-CURRENT LIABILITIES (Contd.) | ||
| t) Social security and taxes | ||
| Withholdings/credit for minimum national income tax | 6,980,000 | 300,000 |
| Income tax provision | (6,980,000) | (300,000) |
| Sundry | 3,565,912 | 4,302,048 |
| 3,565,912 | 4,302,048 |
The report on limited review is issued as a separate document.
REPORT ON LIMITED REVIEW
To the members of the Supervisory Council of
Siderar Sociedad Anónima Industrial y Comercial
We have carried out a limited review of the balance sheets of Siderar Sociedad Anónima Industrial y Comercial at September 30, 2000 and 1999, and of the related statements of income and of sources and uses of funds for the three-month periods then ended, and the statement of changes in shareholders’ equity for the three-month period ended September 30, 2000, with the complementary notes 1 to 12 and exhibits A to I. Furthermore, we have also carried out a limited review of the consolidated financial statements of Siderar Sociedad Anónima Industrial y Comercial with its subsidiaries for the three-month periods ended September 30, 2000 and 1999, which are presented as complementary information. The preparation and issue of these financial statements is the responsibility of the Company’s management.
Our reviews were limited to the application of the procedures established in Technical Pronouncement No. 7 of the Argentine Federation of Professional Councils in Economic Sciences for limited reviews of interim financial statements, which consist mainly of the application of analytical procedures to the amounts disclosed in the financial statements and inquiries made of Company staff responsible for the preparation of the information included in the financial statements and of its subsequent analysis. This review is substantially less in scope than an audit, the objective of which is to express an opinion on the financial statements under review. Accordingly, we do not express an opinion on the Company's financial position, the results of operations, the changes in its shareholders' equity and the sources and uses of funds or on its consolidated financial statements.
Based on the work done and on our examination of the financial statements of the Company and its consolidated financial statements for the years ended June 30, 2000 and 1999, on which we issued our unqualified report dated September 5, 2000, we report that the financial statements of Siderar Sociedad Anónima Industrial y Comercial at September 30, 2000 and 1999 and its consolidated financial statements at those dates consider all significant facts and circumstances which are known to us, and we have no comments to make regarding them.
We have read the “Summary Information” required by the National Securities Commission and, regarding those aspects which fall within our competence, we have no observations to make.
Buenos Aires, November 7, 2000
| PRICE WATERHOUSE & CO. by (Partner) |