Annual Report 2008-2009

Transcription

REPORT AND CONSOLIDATED ACCOUNTS 2008 2009 Futebol clube do porto - futebol, s.a.d.
A3 Evolution of Company Business
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Futebol Clube do Porto - Futebol, SAD
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Report and Consolidated Accounts 2008/2009
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FUTEBOL CLUBE DO PORTO - Futebol, SAD
Public Company
Capital: 75,000,000 euros
Capital: 15,880,863 euros (approved by the General Assembly of November 13, 2008
Head Office – Estádio do Dragão, Via FC Porto, 3rd Floor Poente
Registered in the Oporto 1st Commercial Registry Office, N0 5745
Corporate Fiscal (Tax) Number 504 076 574
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A Management Report
1 President’s Message
2 Governing Bodies
3 Evolution of the Company Business
4 Other Facts Occurring During the Year
5 Material Facts Occurring after the Close of the Year
6 Prospects
7 Information about shares
8 Declaration of the Management Body
B Consolidated Financial Statements and Appendices
1 Consolidated Balance Sheet
2 Consolidated Statements of Results by Nature
3 Consolidated Statements of Changes in Equity Capital
4 Notes to Consolidated Financial Statements
5 Consolidated Statements of Cash Flows
6 Certification of Accounts and Audit Report
7 Report and Opinion of the Statutory Audit Board
C Report on Corporate Governance
0 Declaration on Compliance
1 General Assembly
2 Governing Bodies
3 Information
D Qualifying Holdings
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A
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A
1
PRESIDENT’S MESSAGE
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The fourth championship and the Cup of Portugal are the
highlights of another successful season from FC Porto - Futebol, SAD. And if we add the excellent performance in the
Champions League, in which we won again in our group
ahead of Arsenal, and that we just got out of the scene in the
quarter-final with Manchester United in a round that could
have swung to the blue and whites’, the sense of accomplishment is further strengthened.
The season was filled. The first team has enriched our parchments, but the young ones also inflated our pride. FC Porto
won the Liga Intercalar and the Under-17 Championship,
proving the correctness of the path taken in the detection
and preparation of young athletes.
And, as it has been the norm in recent years, our assets were
again the most requested in the international scene. More
than all the foreign journalistic works on our valorization
process, which is a proficiency certificate across borders, is
the certainty that it is possible to maintain the tone of success, year after year, transaction after transaction.
A final word for the 2008/09 season, which reserved an
enhanced page to the first year of the Dragon Force. Our project is for the young ones. It is already a success. And it will
continue to be, growing under the progression pace of the
FC Porto brand.
Jorge Nuno Pinto da Costa
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A
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GOVERNING BODIES
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General Assembly
President - José Manuel de Matos Fernandes
Secretary - Rui Miguel de Sousa Simões Fernandes Marrana
Board of Directors
President - Jorge Nuno Lima Pinto da Costa
Adelino Sá e Melo Caldeira
Fernando Soares Gomes da Silva
Reinaldo da Costa Teles Pinheiro
Jaime Eduardo Lamego Lopes
Supervisory Board
President - José Paulo Sá Fernandes Nunes de Almeida
Armando Luís Vieira de Magalhães
Filipe Carlos Ferreira Avides Moreira
José Manuel Taveira dos Santos (suplente)
Statutory Auditors
Deloitte & Associados, SROC SA, represented by Jorge Manuel Araújo de Beja Neves
Company Secretary
Daniel Lorenz Rodrigues Pereira
Substitute - Urgel Ricardo Santos Brandão Horta Martins
Advisory Council
President - Alípio Dias
Álvaro Pinto
Álvaro Rola
Américo Amorim
António Gonçalves
António Lobo Xavier
Armando Pinho
Artur Santos Silva
Elisa Ferreira
Fernando Pimenta
Fernando Póvoas
Ilídio Pinho
Ilídio Pinto
João Espregueira Mendes
Poncio Monteiro
Jorge Armindo
Jorge Nuno Pinto da Costa
Ludgero Marques
Rui Alegre
Remuneration Committee
President - Alípio Dias
Joaquim Manuel Machado Faria de Almeida
Fernando Freire de Sousa
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A
3
EVOLUTION OF
COMPANY BUSINESS
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The FC Porto - Futebol, SAD meets its obligations by providing economic and financial information
about the financial year of 2008/2009, between the period of 1st of July 2008 to June 30th 2009.
This document was elaborated according to the present statutory law, indicated in the “Código das
Sociedades Comerciais, Código dos Valores Mobiliários and Regulamentos da Comissão do Mercado
de Valores Mobiliários (CMVM).”
As stated in the European Parliament’s Regulation, the societies with real estate values in regulated
markets inside the European Union (EU) must use, in its consolidated financial statements, international rules of accountancy (IAS/IFRS) adopted by the EU, for all financial statements started on or
after the 1st of January of 2005.
In the case of F.C. Porto – Futebol, SAD, these rules were followed in the 2005/2006 statement. Accounts presented in all trimesters, as well as in this report of annual statements, were made according to the international rules of accountancy.
SPORTING ACTIVITIES
In the wake of recent seasons, the 2008/09 season of the professional football team was full of titles
and high-level exhibitions.
The 24th national champion title allowed FC Porto to directly qualify for the UEFA Champions League
2009/10, all in a year where only the first in classification would guarantee its qualification. In symbolic terms, it was also a title of great importance, since it represented the second time that FC Porto won
the championship for four consecutive times and the sixth League title won in seven years.
However, the team’s career wasn’t depleted in the Portuguese League, as the Dragons added to their
list of successes the Cup of Portugal, with a victory over Paços de Ferreira in the final at Jamor. It
was the sixth ‘double’ (winning the Championship and Cup in the same season) and 14th Cup, in
the culmination of a season that proved once again the enormous capacity of the club to shape and
project football players of the highest worldwide level .
In this field, the ultimate test is the Champions League, where FC Porto fell in the quarter-final at
the foot of the then European Champion title, Manchester United, and by a tangential margin (2-3
in two rounds). The exhibition in England, where the blue and white team got a draw (2-2) and a
superb demonstration was essential to sharpen the desire of great European teams for various elements of the team, which provided a high return by selling their passes. But the career of FC Porto at
the most competitive media world club also had other moments of high level, with the first group
stage (ahead of England’s Arsenal) and the elimination of the Spanish Atletico de Madrid in the
knockout round finals.
The Dragons have, in fact, a record-breaking attendance in the UEFA Champions League alongside
Manchester United, with 15 participations. This is only possible thanks to the careful selection of
players for the professional team, later boosted by the work and overcoming philosophy of the club.
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Today, the creations of FC Porto are praised in the most demanding catwalks of Europe. Cissokho, Lucho Gonzalez and Lisandro Lopez helped to strengthen an already extensive list of athletes created /
discovered and empowered by the Dragon.
In the preparation and during the 2008/09 season the athletes Rodríguez, Rolando and Cissokho were
recruited, safe values as players and knowledge holders of Portuguese football (the French left back
would assume himself as another important process of appraisal of assets), and Tomás Costa, Guarin,
Hulk and Sapunaru, athletes with unquestionable quality and remarkable margin of progression.
Despite the present success, we must also ensure the future.
As to what concerns training, the National Championship Under-17 League title and the Liga Intercalar confirmed the vocation of FC Porto to “train to gain” by keeping the good performance of logic
and consistency of a rich track. The participation in renowned soccer tournaments (especially the
victory in the Tournament Dani Guenes Under-14) enhances, on the other hand, the international
blue and white prestige.
The football school Dragon Force, which fulfilled its first year of operation, is an important step in
that direction. Its implementation was made possible due to the investment at Vitalis Park (formerly Campo da Constituição), with an elite infrastructure, where a pitch of synthetic grass for football
of 11 and a pitch covered with synthetic grass football seven stand out. This was a significant step
towards the projection of the FC Porto, particularly among the young, opening new possibilities in
terms of scouting and later development of young talent.
ECONOMICAL ACTIVITY
Following the good sporting performance, the Futebol Clube do Porto - Futebol, SAD has also been
successful in the economic and financial dimension, consolidating its capital structure. After the
negative result obtained in the financial year of 2005/2006, this is already the third consecutive term
with positive results, a direct consequence of an increased concern with the combination of sporting success and economic viability.
In this report we analyse the consolidated results, i.e., the results obtained through the participation of
individual companies included in the consolidation, net of transactions between them. But of course
these are the individual results of FC Porto - Futebol, SAD that contribute significantly to the consolidated results. The year under review accounts for the second year, with the inclusion of the business
exploitation of PortoSeguro, the company gained 90% on 28 June 2007 for the consolidated result.
Later in this report it will be presented an overview of the results obtained by each of the subsidiaries individually, so now we will concentrate on the analysis of the consolidated results.
As shown in the chart below, the net profit in the last three years reflects operating surpluses.
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Net Result
30.06.2008
30.06.2007
30.06.2009
2,3
8,0
5,1
From a more financial approach, which is increasingly essential to analyse the health of companies,
we found that, despite the fall in net profit compared with last year’s, the cash-flow has been steadily
increasing in recent years, reaching the year in analysis 38.1 M €.
EBITDA - Earnings before interests, taxes, depreciation and amortization
30.06.2008
30.06.2007
30.06.2009
28,5
33,4
38,1
The strong growth in cash flow, measured by the operating income, net of depreciation, impairment losses and provisions in the order of 34% in two years, allows the company greater self-financing ability.
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Despite the serious international crisis that affects in a more or less relevant way the activity of the
companies, the group knew how to increase its revenues over the last year. Even removing from this
analysis the proceeds from transactions with the passes of players, also constituting revenues but
more unstable and uncertain, there was an increase of 13.2 M€ in this indicator, reaching 68.1 M€.
Revenues
2006/07
2007/08
2008/09
14,1
12,5
13,4
7,2
7,1
8,3
UEFA Competitions
12,6
11,6
16,2
Advertisement and Sponsorship
11,4
13,0
13,6
2,4
2,0
2,0
Tickets
TV
Corporate Hospitality
Other Revenues
Revenues excluding transactions with passes
7,3
8,8
14,7
54,9
55,0
68,1
Examining each of the items that are operating revenues, excluding transactions of players passes; it
appears that all, without exception, have grown in the previous period.
The box office, which includes the marketing of Dragon Seats (seats per year), tickets sold per match and part of the dues paid by members of the FC Porto which are in the benefit of the sporting
society, was influenced by the achievement of UEFA 1/4F Champions League at Estadio do Dragão,
considering that in the two previous years, the team stood at 1/8F of the competition. The sale of
individual tickets for this game, played with Manchester United at Estadio do Dragão, contributed
to the growth of the gate receipts at about 0.9 M €.
Regarding television revenue, there was an increase of 1.2 M €, which derives from the contract
signed on July 4, 2008 between FC Porto - Futebol, SAD and Olivedesportos - Advertising, Television
and Media Limited. As communicated on time to the market, the two companies prorogated until
the 2013/2014 season, the transfer contract, on an exclusive basis, the rights of audiovisual media,
national and international games played for FC Porto for the main competition Portuguese League
for Professional Football as the home team. In return for this agreement, the FC Porto - Futebol, SAD
obtained additional revenues of € 1M in the year under review. In addition, and reflecting the growing interest in the work of FC Porto, there was an increase in revenue from the sale of television
rights to pre-season games.
For the UEFA Champions League, the company obtained a much higher business ratio than the previous
season as the team had a more positive performance in this competition. FC Porto passed the 1st stage
of the competition, played against the Fernebahçe, Dynamo Kiev and Arsenal, getting the 1st place in
the group. In the 1/8F eliminated Atletico Madrid, according to the 1/4F, where it found the at the time
European champions, Manchester United, defeated by 2-3. Even if it is negative for Portuguese football,
the presence of two teams in European competition without the presence of SL Benfica and in 2007/2008,
has enabled the company to obtain additional € 0.4 M in the UEFA Market Pool. It was still registered as a
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revenue of this exercise, the guaranteed access to the 2009/2010 edition of the UEFA Champions
League, which provides financial compensation to the participating teams, about 30% higher than
the previous edition.
The income relating to advertising contracts and sponsorship comes mainly from advertising in the
official equipment of F. C. Porto, by its main sponsors, which in the year under review were Portugal
Telecom, Nike, and BES. The contract extension with Nike, signed on 25 October 2007, valid for four
years 2008-2012, along with royalties and the prize for sporting performance given by this renowned
brand of sports equipment that will continue to dress all blue and white teams assured the FC Porto
- Futebol, SAD an additional income of around one million euros. However, a reduction in the same
line, in PortoComercial, led to the overall increase to be located at 0.6 M €.
The operating results of Corporate Hospitality business, which briefly consists in providing a range
of products and services for corporate clients, which include the rights to use of boxes and seats
for companies in the Dragão Stadium to watch the FC Porto games, are directed to the company
EuroAntas held by FC Porto (club), which uses this cash to meet debt service contracted to build the
stadium. The model is designed such that FC Porto - Futebol, SAD, after having honored all of its
obligations under the Project finance, guarantees itself the distribution of the excess amount from
the management of this business. The value obtained in this space remained virtually unchanged,
contributing to the result of the company with 2M €.
The item “Other Revenues” has increased, when compared with the previous period, 5.9 M €.
This increase was due mainly to two factors. First, here are encompassed the sale of merchandise, a business
area that was further explored by PortoComercial, as explained later in this report, which contributed to the
consolidated business ratio of 2.1 M €.
Moreover, here is also reflected the effect of accounting for the overall benefit of the unilateral termination of professional football coach Co Adriaanse and his assistant coach, as decided by the CAS
(Court of Arbitration for Sport).
Additionally, this item includes revenue from the participation of FC Porto in friendly tournaments held
in pre-season in the Cândido de Oliveira Super Cup and the Cup of Portugal, which this year awarded its
winner FC Porto, a 500 thousand euros prize. Here are also encompassed the incomes arising from PortoComercial, not included elsewhere, including the guaranteed revenue contract with TBZ, which was obtained
before termination of the same (according to the above analysis of the activity of PortoComercial). This item
also includes the revenues of other companies in the consolidation sphere, PortoEstádio, the PortoMultimédia and PortoSeguro.
As a result of the given data, the operating income excluding transactions Passes players increased 24%
over the previous period, as shown in the chart below:
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Revenues excluding Passes Transactions
30.06.2007
30.06.2008
30.06.2009
54,9
55,0
68,1
Analysing the cost structure of the society, there is an increase of about 27% when compared with
2007/2008. When observing the table below, we find that this increase is based largely on increase at
the staff costs level and other costs pertaining to ‘other operations’.
Operational Costs
2006/07
2007/08
2008/09
External services and suppliers
16,1
16,9
20,2
Costs with staff
34,0
38,7
47,5
Amortization excluding devaluation of passes
0,9
0,9
1,0
Other operational costs
-2,8
1,0
4,5
Operational costs excluding passes transactions
48,2
57,5
73,2
Labor costs, which have large representation in the cost structure, as it is typical in this activity,
were higher by about 8.8 M €, largely because of prizes paid to the team for good performance in the
disputed national and European competitions. Note that 25% of total staff costs are presented for a
variable component related to the individual and collective performance of the team.
On the other hand, the company bets on the investment of the team with players of high quality,
most of them international with their national teams, to ensure the best sporting results, which
necessarily requires adequate compensation to their status. Additionally, it is the company’s policy
to ensure the continuation of key players in the squad. Thus, in order to safeguard the ‘Webster Law’
(Article 17. Of the ‘Regulations on the status and transfer of player’, which allows a player to unilaterally terminate the contract after three years in a club, or just two if he is over 28 years, to represent
a foreign club, and to compensate the club for the value of salaries that would have been entitled to
receive for the years he had in contract) and FC Porto - Futebol, SAD renewed, even in the sporting
season 2007/2008, the working contracts with various athletes, and payments and conditions were
improved, a situation that obviously had an impact in the season in question.
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The item Supplies and Services noted a considerable increase of about 3.3 M€, distributed by various companies represented in this consolidated report. FC Porto - Futebol, SAD, in order to be able
to meet the increasingly varied needs for work, had to spend an amount higher than current costs.
There was also an increase in this rubric with PortoComercial and PortoEstádio in order to accommodate the organized events, with the usual quality.
The costs pertaining to ‘Other Operations’, shown in the table above, were increased by 3.5 M€. A
total of € 4.5 million presented, are included impairment losses for receivables, amounting to 2.2
M € due to failure to meet deadlines on receiving credits from various entities. In addition, it also
encompassed the cost of goods sold by PortoComercial, amounting to 1.4 M€, which did not appear
reflected in the previous two years, since the exploitation of the commercial areas of the FC Porto
was carried out by the end of the previous year by TBZ.
The combination of factors presented led to obtaining Operating Income, excluding players transaction Passes of a negative 5.1 M€.
It is important to add to this analysis two items of FC Porto - Futebol, SAD that have an undeniable
weight, the amortization and impairment losses with passes of players and the outcome of players
transactions Passes.
Contributing negatively to the outcome of the society, the amortization and impairment losses with
players passes registered a value of 23.8 M€, representing an increase of € 3.7 million from the previous period. The increase in depreciation resulting from contracts signed with the players and the
investments made in the acquisition of sports rights, reflect the investment in the team, while the
increase in impairment losses is related to the increase in economic costs with the deduction of the
players pass in assets.
The result of the players transactions Passes which includes the costs and revenues resulting from
loan sales and players sports rights has traditionally been a positive item in the financial statements
of the group. Here are encompassed capital gains from the sale of players sports rights that have
played a substantial part of the proceeds from FC Porto - Futebol, SAD and in a broader perspective,
of many companies in this sector of activity that in this way balance the exploitation results. The
41.5 M€ of capital gains arising from transfers (to the value of the sale must be subtracted the costs
of each business and the net book value of its sports rights) and loans are derived largely from sales
of Quaresma’s Players sports rights to Inter Milan for € 24.6 M, (held at the beginning of the season)
and the pertaining prizes of contract objectives of Lucho to Marseille for € 18M and Paulo Machado
to Toulouse, for 3.5 M€.
The result of the players’ passes transactions presents, therefore, a net value of € 40M .
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Results with Transactions with Passes
30.06.2007
30.06.2009
30.06.2008
24,3
35,3
40,0
Based on the graphic above, it is clear the influence that the income generated from the transaction
of the players’ passes has in the total obtained in operating income. The focus on equipping the team
with good values, in addition to contributing to the sporting success, also make possible to obtain
important gains for the society itself.
Despite the operating profit excluding Passes Transactions being negative, the addition of these two
items related to transactions of players passes, allowed achieving an operating income of 11.2 M€.
Operating Results
30.06.2007
30.06.2009
30.06.2008
9,4
12,7
11,2
In addition to the operating results, it is necessary to include the financial results to obtain the net
result. In this exercise, the financial results worsened in 1.6 M€ not only by the increase in financial
charges arising from more difficult access to credit, but also the effect of the adjustments required
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to the level of international accounting standards, relating to the updating, by bringing the payment terms, and accounts to be paid by the society.
As an epilogue of the analysis, and after deducting the calculation of tax liability of € 0.6 million,
the consolidated net profit of the society was, as mentioned above, 5.1 M €.
Still considering the annual exploitation of the company it is important to present a key indicator
in the activity, which reflects the weight that staff costs have on the income. Using the indicator
commonly used by experts in the analysis of the finances of football, this ratio, which should not
include the income from transactions with passes of players must be below 70%, as recommended
by UEFA. As you can see by the chart below, the company has managed to keep the ratio within the
recommended levels, despite the constraints that FC Porto has, as a club from a small country, the
raising of traditional revenues (box office receipts and television advertising), for major European
clubs, given that to maintain the same level of competitiveness it has to pay similar wages.
Salaries vs Operational Income excluding transactions with players’ passes
30.06.2007
30.06.2009
30.06.2008
62%
70%
70%
Moving to the patrimonial position of the company on 30 June 2009, it is highlighted the fact that
the total accounting assets amount to €183.6 M, representing an increase of 16% compared to June
30, 2008. This increase is supported not only by an increase in the value of the sports rights of players,
due to the investment made in strengthening the squad, but also because of the receivable amounts
from the sale of players are prolonged in time, reflecting the agreed conditions.
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Assets
30.06.2007
30.06.2009
30.06.2008
126,3
158,8
183,6
The company’s total debt amounts, on 30 June 2009 to 160.8 M €, with a strong connection with
bank loans, because the accounts are disclosed in accordance with international accounting standards (IAS / IFRS) , include the value of discounted bills.
Contractualised Financial transactions are secured with collateral of receivables by the company.
The structure of the penalized liabilities appears, on June 30, 2008, solely due to the proximity of
the deadline for repayment of the loan, which will be undertaken at nominal value, at once, on 15
December 2009. However, the company has already prepared a financial transaction to restructure
the liability so as to become a significant part of its debt in the long term.
Liability
160,8
141,1
116,6
30.06.2007
30.06.2008
78,0
98,8
124,6
38,6
42,3
30.06.2009
36,2
Non current liability
Current Liability
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Concerning the company’s equity capital it is possible to verify that the results obtained in recent
years have improved the pertaining structure.
Equity Capital
30.06.2007
30.06.2009
30.06.2008
9,7
17,7
22,8
In this analysis one should not overlook the financial statements that may not be able to reflect the
fair value of the company, mainly due to the fact that some assets are recorded in the accounts for
values significantly below their market values. With regard to the book value of the squad, it is clear
that this does not reflect its fair value, because if the “passes” of the players of the squad were recorded at their market value, this asset item would be considerably higher. Each year, the company
has obtained very significant gains on the sale of sports rights of players of the squad, which clearly
shows that these assets are deflated in accounting.
However, and since the equity capital is less than half of the capital, FC Porto - SAD is under the
provisions of Article 35 of the Companies Act.
The Board of Directors of FC Porto - SAD believes that, depending on the profits of the year 2008/2009
and budget estimates for fiscal year 2009/2010 to be presented at the Annual General Meeting, the
capital structure of the society will appear naturally reinforced.
Even without reaching the objective of the meeting referred to in Article 35 of the Companies Code,
this Administration is convinced that the economic and financial performance improvement will
continue in the coming years, and so complying with that Article.
Moreover, the Board provides that the publication of the results for the 1st quarter of 2009/2010, are
now presented results of operations enabling the company to come out from under that article.
Even so, and in the assumption of quickly complying with this requirement, the Board has been
studying other solutions that will enable to strengthen the company’s capital.
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The Board of Directors, besides looking at the analysis of this issue at the General Meeting of Shareholders for approval of the accounts for this year may also convene an Extraordinary General Meeting for discussion and approval of proposals that may be presented, which may pass the following
alternatives:
* Reduction of share capital amounting to not less than the equity of the company;
* Development of capital entries by members to strengthen the coverage of the capital, and
* The combination of the two alternatives.
OVERVIEW OF THE COMPANIES INDIVIDUAL ACCOUNTS BELONGING
TO THE CONSOLIDATION REPORT PERIMETER
PortoComercial
PortoComercial is the operator of the brand FC Porto, which develops the commercial component
of this activity in its various areas, such as merchandising, sponsorship and licensing, and is owned
93.5% by FC Porto - Futebol, SAD.
By decision of the Board of PortoComercial, the contract concluded on 31 March 2006, with TBZ
- Promotional Marketing, SA, for providing the commercial exploitation of the brand and the shopping areas of FC Porto, and that was the target of amendment on June 30, 2008, failing to include
the management and operation of shopping areas, it was terminated for just cause due to failure to
comply with obligations on 4 December 2008.
These facts have caused major changes in the income structure of society, as shown in the table
below:
5%
13%
12%
1%
5%
0%
14%
22%
7%
17%
2%
21%
13%
60%
67%
43%
2006/2007
Sales
Licensing
2007/2008
Advertisement
2008/2009
Brand Transfer
Other Services
30
The immediate effect was to decrease the item of income, “Transfer of the Brand,” by decreasing
the minimum guaranteed income for the change in contract with TBZ at the beginning of the fiscal
year. The effect of termination, with the disappearance of this income and to take the business license for PortoComercial, had only visibility in the 2nd half of this fiscal year, to the extent that the
contract was terminated on December 4, 2008.
However, this impact was compensated by the development of other business areas within the PortoComercial. The business ratio of the company increased 32%, driven by the fact that the sale of
merchandise, which contributed 2.1 M € has returned to be managed by the company.
The successful marketing of the concepts of “Corporate Hospitality” continues to have strong representation in the income structure of the company, but remained stable in value terms over the
financial years since its marketing has always led to an occupancy rate close to 100%.
In early October 2008 there was another change in the business PortoComercial, as it became responsible for marketing services in non-sports events held in the Estádio do Dragão, prior activity
within the PortoEstádio. This service, although it was already assigned to PortoComercial during
the year under review, had a considerable impact on the income structure of society, since it contributed with more than one million euros for the business ratio.
Thus, the activity of PortoComercial during this financial year recorded a total income of 11.2 M €,
representing an increase of 32% over the same period last year.
values in milliards of euros
Porto Comercial
2006/2007
2007/2008
2008/2009
Turnover
6.752,3
8.435,3
11.171,1
Total Income
6.814,0
8.553,1
11.280,8
Total of Costs before taxes
6.664,4
6.379,6
10.673,5
Period Result
103,5
1.597,2
396,7
Cash-Flow
388,6
1.717,7
921,5
Alongside the alteration in the income composition, also the cost structure has underwent some alterations. The cost of goods sold, which had an almost residual value, is now responsible for 13% of operating
costs of the company. Supplies and services also suffered a considerable increase in order to guarantee the
usual quality in the organization of events held. There was also a significant increase in staff costs, given
the increase in the number of staff needed to ensure the business areas that fall within the PortoComercial again. During this period they also recorded impairment losses to deal with bad debts of receivables
and depreciation of goods, a total of 412mil Euros.
The combination of these factors allowed the acquisition by PortoComercial, a net profit of 397 thousand
Euros.
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PortoEstádio
PortoEstádio, owned entirely by FC Porto - Futebol, SAD, is a company conceived and directed towards
the management and operation of sports facilities of the FC Porto Group. Currently, the company is
responsible for the Estádio do Dragão and the Center for Vocational Training and Sport, but also by
Vitalis Park and the Home Youth Soccer, giving the daily exploitation of the latter a large percentage
of its business ratio.
Near the end of the period under review, April 23, 2009, the Dragon Box premiered, the new pavilion
of the club, located next to Estádio do Dragão. This pavilion will play host to three sports modalities
of the club (hockey, handball and basketball), and can also host other events of sporting nature and
culture. This modern infrastructure, with capacity for 2007 seats, will also be managed and operated
by PortoEstádio.
To further rationalize the activities of PortoComercial and PortoEstádio the marketing of non-sporting
events held in the Estádio do Dragão, previously performed by PortoEstádio, is now managed by PortoComercial on the understanding that the latter is more suitable for this activity. PortoEstádio maintains the responsibility of organizing the games and the performance of the non-sporting events.
This, despite not having committed the revenue, since there was an increase of about 21% of the total income generated by the company, came to influence the outcome, since this is the only exercise
in the last three years, which presents a result of practically zero.
Porto Estádio
2006/2007
2007/2008
2008/2009
Turnover
5.990,8
6.666,8
7.904,3
Total Income
6.218,7
6.880,7
8.306,3
Total Costs before Taxes
5.928,1
6.788,1
8.285,8
Result of the Period
187,8
70,8
0,3
Cash-Flow
516,5
873,3
351,7
As shown by the analysis of the above table PortoEstádio showed a significant increase in the business ratio around 19% over the same period last year. This increase was due basically to the growth
in revenues related to the events. Providing services in events, including football games remains the
main portion of the income structure of the society.
However, the non-sporting events continue to be very important, since the smaller events that take place
daily, as some with more focus, are becoming more and more common in the Estádio do Dragão, as São João,
or Festival Panda. In the year under review it was particularly important to conduct an event that needs no
introduction, the “Race of Champions” an event that mixes top drivers in motorsport. This event, unique
in Portugal, called for the construction of a real racing track in place of lawn, which reflects the enormous
capacity and versatility that a modern and well-designed stadium can provide to a variety of audiences.
32
In terms of costs, there was a substantial increase, taking into account the business ratio, which
is due solely to an increase in supplies and services to cope with the realization of events carried
out, especially the aforementioned “Race of Champions “, which forced the company to have high
costs. In the remaining cost items there have been no major changes made in the same period of the
previous year.
It is also reflected in these accounts, an adjustment of customers debts due to failure to meet deadlines for receipt of credits, as well as strengthening the provision made in 2007/2008, to deal with a
case brought by a third party for the cancellation of the “Festival of the Dragon”, which should have
taken place in 2005, totaling 190 billion euros.
This is a transitional year in which the PortoEstádio stopped operating a business area from which
he drew a considerable margin, the marketing of services in non-sporting events, now it only operates these same events, so the result of the society suffers this transition.
Despite the net about zero, the PortoEstádio generated a cash flow, which reflects the cash flows for
the business, of about 352 thousand euros.
PortoMultimédia
The PortoMultimédia is held directly and indirectly 70% by FC Porto - Futebol, SAD. The main activity of the company consists of editing, production and marketing of multimedia content management and commercial exploitation of products and services of the club through remote channels,
which include the Internet, Mobile Phone and the production of periodicals and non-periodic digital format.
In carrying on the 2008/2009 season, PortoMultimédia significantly expanded its level of activity in
various business areas at the same time presenting novelties and new features in line with its strategy
of continuous innovation. At the end of the season, to lead the conquest of the “fourth title” in the
Portuguese Football League, a new official site started with completely new graphics, more appealing
and more simple, particularly in terms of menu structure, thus increasing the levels of usability from
visitors. In addition there was a presentation on the home page and on the main page of videos relating to special international achievements and the achievement of the”fourth title” by the first team.
The new site also includes platforms that bring together members and supporters of the Club such as
direct access to micro-blog Twitter FC Porto and the introduction of three thematic blogs (Dragon Seat,
and Dragon Force Dragon Tour). There is also innovation in the area of video content, by entering into
a partnership with an operator of television and two mobile operators which allowed for the first time
in Portugal to view live coverage of some games of FC Porto., The Portuguese Football League, the Meo
Mobile service.
In addition to the renewed and adding content, there is a fundamental aspect: the English version of
the site. At a time when FC Porto is the Portuguese club with the highest reputation on the international scene, and won more titles, publishing information in English has become essential, which
33
shows a clear commitment to the internationalization of the brand. The debut of the new layout, on
5 June 2009, was marked by a video message from the president of the club.
With regards to available services in the Club media channels there was a very significant increase in
transactions, particularly in the area of ticketing and payment of shares. The sale of tickets for games at
Estádio do Dragão registered historical levels of sales in the Champions League European Cup, including
the game quarter finals where the opponents were Manchester United. The system of sale completely
integrated with the information system of the club showed a good capacity to meet the high demand and
experienced the same thing with the annual renewal of seats at the end of the season. Also in the sale of
tickets capital gains at the level of delivery service to the club associates have been introduced contemplating new local surveys with extended opening hours in commercial spaces.
Porto Multimédia
2006/2007
2007/2008
2008/2009
Turnover
434,5
432,2
443,4
Total Income
440,4
432,2
443,4
Total of Costs before Taxes
467,5
477,9
488,5
Period Result
-27,1
-45,7
-45,1
Cash-Flow
-23,3
-42,9
-42,8
Moving to the results, it appears that there is little variation over the years, which derives from the
fact that the accounts presented above reflect accounting movements inherent in the contractual
structure of company activity.
The structure of income, representing a total of € 443m, reflecting the expertise in the exercise of
the advance received for supplying the Sportinveste Multimedia on an exclusive basis and for a period of 10 years, a set of rights capable of online businesses. With regards to costs, there is a slight
increase due to the increase in supplies and services. The net result was, in this exercise, negative
about forty-five thousand euros.
PortoSeguro
On 28 June 2007, FC Porto - Futebol, SAD acquired from FC Porto a 90% share of the capital of PortoSeguro, Ltd. This well known company engaged in the activity of insurance mediation was evaluated by an external entity, in 1.4 M €.
The PortoSeguro represents many different insurance companies, particularly larger ones operating
in the market in non-life and life, and its portfolio of companies consists mainly of individual customers, especially in terms of representing the Group Futebol Clube do Porto itself.
Throughout the activity of insurance mediation and on the Ranking of the top 20 corporate agents
“ PortoSeguro is located on the 19th being that insurance agents of collective people with corporate
34
headquarters in Porto there are only three, one belonging to a group banking (12.) and another of a
large business group (15.). Please note that other companies are mostly owned by financial institutions and national and multinational car companies. There is in this sector a high concentration of
companies with headquarters in Lisbon (11).
Although the purchase price is already reflected in the stock of FC Porto - Futebol, SAD in the 2006/2007
financial year, the operating business of PortoSeguro on this exercise has not been included in the consolidation report. So, this is only the second fiscal year in which the FC Porto - Futebol, SAD consolidates its accounts with the PortoSeguro, so we will just present the figures for these two periods.
Porto Seguro
2007/2008
2008/2009
Turnover
675,4
574,6
Total Income
710,2
588,4
Total Costs before Taxes
760,0
617,1
Period Results
-52,4
-30,5
-9,7
8,3
Cash-Flow
Regarding the financial situation of the company, it was verified during the period, a decrease in the
business ratio of around 15%, which is derived not so much by the reduction in size of the portfolio
of awards, but especially by margins earned.
The year 2008 was marked by economic and financial crisis that began in the summer of 2007 and
whose peak was reached in September 2008. Macroeconomic and financial climate, observed internationally, resulted in significant losses for some financial groups, in particular for the insurance
ones. Add to that the domestic insurance market is also hampered by the international situation due
to the urgent need to appeal to the world market reinsurer, with increased costs, reduced commissioning and lack of business placement.
To make matters worse, during the year 2008, there was an increase of 20% of insurance agents, category of intermediary insurance which includes the PortoSeguro, which meant more and stronger
competition in this market.
The costs of the company suffered a proportional decrease in the order of 19%, thus achieving a
positive cash flow, which allows the company greater ability to flow. Net income for the period was
negative at around 31 thousand euros.
35
A
4
OTHER FACTS
OCCURRING DURING THE
EXERCISE
36
* On the 15th of July 2008, FC Porto - Futebol, SAD was informed of the decision of the Court of Arbitration for Sport on appeals by Sport Lisboa e Benfica Futebol SAD and Vitoria Sport Clube with the
decision rendered on June 13, 2008 by Appeals Committee of UEFA. The Court of Arbitration for
Sport rejected the appeals. Therefore, it remained the decision of the appeals committee of UEFA
that has confirmed the participation of FC Porto in the 2008/09 UEFA Champions League.
* On the 13th of November 2008, FC Porto - Futebol, SAD voted in the General Assembly, the Audit
Committee of the Society for the four years 2008/2011, on the death of the former President. The
new Audit Committee is now composed of:
• José Paulo Sá Fernandes Nunes de Almeida (President)
• Armando Luís Vieira de Magalhães
• Filipe Carlos Ferreira Avides Moreira
• José Manuel Taveira dos Santos (Substitute)
* On the April 3rd , 2009, the acquittal of the President of the Board of Directors of FC Porto - Futebol,
SAD under the “Apito Dourado was known“. The multiple processes that were originated in the
extracts taken from the “Apito Dourado”, was successively filed, and the chairman of FC Porto - Futebol, SAD was exonerated of any and all charges.
* On April 28th 2009, FC Porto - Futebol, SAD and Unicer signed a partnership agreement, valid for
the triennium 2009-2012. By this contract the society gives and ensures the status of main sponsor
of the Professional Football Team, which allows them to advertise on the official equipment.
* FC Porto - Futebol, SAD formalized on 3rd June 2009, the agreement to extend for a further two
seasons, i.e. until 30th June 2011, the employment contract that binds the company to the coach
of the first team, Jesualdo Ferreira.
* On 4th June 2009, FC Porto - Futebol, SAD completed its acquisition of 80% of the sports subscription of the player Álvaro Pereira, for 4.5 M €. The athlete has signed an employment contract with
a duration of 5 athletic seasons, to which a termination clause of 20M€ was imposed. The economic and financial effects of this acquisition will be the formalized in the year 2009/2010.
* Under the scope of the society’s bond issue, it the payment of interest on the coupon No. 4 and No.
5, the “Bond Loan 2006-2009” on 15 December 2008 and June 15, 2009, respectively was done. The
reimbursement of the operation will take place on December 15, 2009, as defined in the prospectus
of the public offer.
37
A
5
RELEVANT EVENTS
OCCURRED AFTER THE
CLOSE OF THE YEAR
38
* On July 6th, 2009, FC Porto - Futebol, SAD bought for € 5M, the sport registration fees and 50%
of the economic rights of the player Fernando Belluschi, to the Olympiakos of Greece, having the
athlete signed a contract of employment lasting for 5 sports seasons and with a break clause of
30M €.
* On 7th July 2009 to FC Porto - Futebol, SAD reached an agreement with the Olympique Lyonnais
(Lyon) for the sale of sports subscription rights of the professional soccer player Lisandro Lopez in
the amount of 24M €. The total amount to be received by this transfer may reach € 28M, depending on the sporting performance of the club that the athlete has come to represent.
* On 15th July 2009, FC Porto - Futebol, SAD bought, 3.930 M €, the sport registration fees and 60%
of the economic rights of the player Radamel Falcao, from River Plate, and the player signed a contract of employment with a duration of 4 sport seasons with a break clause of 30M €.
* On 18h July 2009, FC Porto - Futebol, SAD sold for € 15M, the registration Sports rights of the player
Aly Cissokho to Olympique Lyonnais (Lyon). The company has secured 20% of the added value that
Olympique Lyon may get as a result of an eventual transfer of the player.
* FC Porto - Futebol, SAD decided on 21st August 2009 to extend for a further two seasons, i.e. until 30
June 2014, the employment contract that binds the firm and its player of Givanildo Vieira de Souza
( “Hulk”) and changed its termination clause to € 100M.
39
A
6
PROSPECTS
40
With the accountability of 2008/2009, which for the third consecutive year shows a positive result,
it is observed that the capital structure of the society has improved significantly, according to the
results presented.
The budget of the company for the financial year 2009/2010 announced a very positive panorama;
this paves the greater strength and consistency in the capital structure of society, while maintaining the goal of competing at the highest level in 2009/2010. The added value of transfers already
achieved with the sale of subscription rights of the sports player Lisandro Lopez and Aly Cissokho
to Lyon in July, helped to ensure important revenue for the company and the prospect of a positive
result next season.
On the recurring question of compliance with the Article 35 of the Companies Act, the Board of Directors of FC Porto - Futebol, SAD believes that, depending on the profits of the year 2008/2009 and
the estimate budget for the fiscal year of 2009/2010 to be presented at the Annual General Meeting,
the capital structure of the society will appear naturally improved.
Reinforcing this, the Board provides that the publication of the results for the 1st quarter of 2009/2010
will already provide results of operations enabling the company to get under that article.
FC Porto - Futebol, SAD assured, once again, its presence in the most important competition of the
European football, UEFA Champions League, thus maintaining its status of record attendance at the
event. At the time of this report, FC Porto is placed 2nd in the group, led by the colossal English team
Chelsea and thus with good prospects for following the 1/8F of the race. In addition to the direct financial results, awarded by UEFA, the presence of FC Porto in the great showcase of European football,
where players strongly shine, it is essential their valorization as economic assets of the society.
This is the vision we have for our future. Modern football requires sporting and economic efficiency.
This is the fate of F. C. Porto - Futebol, SAD. That is why we clearly bet on the training of talents and in
early detection of the best players. This is where we want to make a difference.
41
A
7
INFORMATION
SHARES
42
FC Porto - Futebol, SAD has, in terms of consolidated accounts, 100 shares, valued at € 499. These
shares, with a very small representation in the capital of the company are held by PortoSeguro, society in the consolidation, owned 90% by FC Porto - Futebol, SAD.
The PortoSeguro acquired the 100 shares at the time of the formation of the Public Limited Sports
Company in 1997 and has not since then sold or purchased any further stock. Thus, FC Porto - Futebol, SAD had consolidated in terms of both the beginning and the end of the period under review,
100 shares, with an acquisition cost of € 500.
43
A
8
DECLARATION
MANAGEMENT BODY
44
Under the provisions of subparagraph c) of paragraph 1 of Article 245 of the CMVM, the directors of
FC Porto - Futebol, SAD, as responsible parties for the company, say, to the best of their knowledge,
the information contained in the report management, in the annual accounts and other documents
of accountability required by law or regulation, although they have not been submitted for approval
at the general meeting have been prepared in accordance with the applicable accounting standards,
giving a true and fair view of the asset and liabilities, financial position and results of the issuer
and the companies included in the consolidation perimeter, when appropriate, and that the annual
report faithfully exposes the evolution of the business performance and position of the issuer and
the companies included in the consolidation perimeter, contains a description of the principal risks
and uncertainties that they face.
Porto, 6th of October 2008
The Board of Directors
________________________________
Jorge Nuno Lima Pinto da Costa
________________________________
________________________________
________________________________
________________________________
45
46
B
47
B
1
CONSOLIDATED BALANCE
SHEET AS OF 30 JUNE 2009
AND 2008
48
1. Consolidated Balance Sheet as of 30 June 2009 and 2008
(Translation of statements originally issued in Portuguese - Note 35)
(amounts expressed in euros)
Assets
Notes
30.06.2009
30.06.2008
NON CURRENT ASSETS
Tangible assets
Intangible assets - players’ registrations
Other intangible assets
Investments held for sale
Goodwill
Trade receivables
Other non current assets
7
8
7
9 e 20
10
11
13
2,729,430
57,876,220
1,761,787
901,226
717,647
25,677,823
15,397,672
2,941,279
50,678,865
1,788,139
901,226
717,647
13,659,745
14,963,937
105,061,805
85,650,838
617,928
60,111,707
10,813,768
6,967,350
43,800
56,660,539
12,933,255
3,518,379
78,510,753
73,155,973
183,572,558
158,806,811
75,000,000
(499)
259,675
99,873
635,414
(58,495,252)
5,135,220
75,000,000
(499)
259,675
20,013
318,051
(66,063,620)
7,964,449
22,634,431
17,498,069
141,081
206,219
22,775,512
17,704,288
21,000,666
8,278,348
6,871,834
-
22,124,579
14,590,771
4,331,978
1,222,652
-
36,150,848
42,269,980
55,184,343
14,871,385
25,177,684
27,488,137
1,924,649
44,949,081
23,548,755
28,728,780
1,605,927
Total non current assets
CURRENT ASSETS
Inventories
Trade receivables
Other current assets
Cash and cash equivalents
12 e 21
11 e 21
13
14
Total current assets
TOTAL ASSETS
EQUITY AND LIABILITIES
SHAREHOLDERS’ FUND:
Share capital
Own shares
Share issue premiums
Legal reserve
Other reserves
Retained earnings
Consolidated net result for the year
16
Equity attributable to equity holders of the parent company
Minority interests
17
TOTAL EQUITY
LIABILITIES:
NON CURRENT LIABILITIES
Bank loans
Bonds
Trade payables
Other non current liabilities
Provisions
18
18
19
20
Total non current liabilities
CURRENT LIABILITIES
Bank loans
Bonds
Trade payables
Other current liabilities
Provisions
18
18
19
20
21
Total current liabilities
124,646,198
98,832,543
TOTAL LIABILITIES
160,797,046
141,102,523
TOTAL EQUITY AND LIABILITIES
183,572,558
158,806,811
49
B
2
CONSOLIDATED
INCOME STATEMENTS BY NATURE
FOR THE YEARS ENDED
30 JUNE 2009 AND 2008
50
2. Consolidated Income Statements by Nature for the years ended 30 June 2009 and 2008
Operational income:
Sales
Services rendered
Other operational income
Notes
30.06.2009
30.06.2008
22
2,122,361
62,338,766
53,411,763
23
Total operational income
Operational expenses:
Cost of sales
External supplies and services
Payroll expenses
Amortisation and depreciation excluding amortisation of players’ registrations
Provisions and impairment losses excluding players’ registrations
Other operational expenses
12
24
25
7
21
Total operational expenses excluding expenses with players’ registrations
Operational profit/(loss) excluding results with players’ registrations
1,561,010
54,972,773
1,430,271
20,171,298
47,542,521
964,835
2,180,174
922,419
16,871,976
38,703,730
921,140
(332,678)
1,338,307
73,211,518
57,502,475
(5,068,024)
(2,529,702)
Amortisation and impairment losses of players’ registrations
26
23,769,971
20,083,602
Income/(expenses) related to players’ registrations
26
40,007,626
35,320,259
16,237,655
15,236,657
11,169,631
12,706,955
7,149,406
1,682,162
5,013,048
1,140,071
-
-
5,702,387
8,833,978
(555,094)
(785,454)
5,147,293
8,048,524
-
-
5,147,293
8,048,524
17
5,135,220
12,073
7,964,449
84,075
29
0,34
0,53
Excluding discontinued operations
Basic
Diluted
0,34
0,34
0,54
0,54
from discontinued operations
Basic
Diluted
n.a.
n.a.
n.a.
n.a.
Total operational profit/(loss)
Finalcial expenses
Financial income
27
27
Investment income
Profit/(loss) before income tax
Income tax
15
Profit/(loss) for the year
Profit/(loss) for the year for discontinued operations
Consolidated profit/(loss) for the year
Atributable to:
Equity holders of the parent company
Minority interests
Earnings per share
The accompanying notes form an integral part of the consolidated financial statements
51
3,682,367
68,143,494
B
3
CONSOLIDATED STATEMENTS
OF CHANGES IN EQUITY
FOR THE YEARS ENDED
30 JUNE 2009 AND 2008
52
53
75,000,000
Balance as at 1 July 2008
Balance as at 30 June 2009
75,000,000
-
Consolidated profit/(loss) for the year
ended 30 June 2009
-
Transfer to retained earnings
-
Transfer o other reserves
Changes in reserves
-
Tranfer to legal reserve
Appropriation of profit of 2007:
75,000,000
Balance as at 30 June 2008
-
Consolidated profit(loss) for the year
ended 30 June 2008
-
Transfer to retained earnings
Changes in reserves
-
Transfer to other reserves
75,000,000
Share
capital
Transfer to legal reserve
Appropriation of profit of 2006:
Balance as at 1 July 2007
(499)
-
-
-
-
-
(499)
(499)
-
-
-
-
-
(499)
Own
shares
259,675
-
-
-
-
-
259,675
259,675
-
-
-
-
-
259,675
Share
issue
premiums
99,873
-
-
-
-
79,860
20,013
20,013
-
-
-
-
4,069
15,944
Legal
reserve
635,414
-
-
-
317,363
-
318,051
318,051
-
-
-
77,290
-
240,761
Other
reserves
(58,495,252)
-
1,142
7,567,226
-
-
(66,063,620)
(66,063,620)
-
(5,007)
2,178,667
-
-
(68,237,279)
Retained
earnings
5,135,220
5,135,220
-
(7,567,226)
(317,363)
(79,860)
7,964,449
7,964,449
7,964,449
-
(2,178,667)
(77,290)
(4,069)
2,260,026
Net
profit(loss)
Attributable to equity holders of the parent company
3. Consolidated Statements of Changes in Equity for the years ended 30 June 2009 and 2008
22,634,431
5,135,220
1,142
-
-
-
17,498,069
17,498,069
7,964,449
(5,007)
-
-
-
9,538,628
Total
141,081
12,073
(77,211)
-
-
-
206,219
206,219
80,484
-
-
-
-
125,735
Minority
interests
22,775,512
5,147,293
(76,069)
-
-
-
17,704,288
17,704,288
8,044,933
(5,007)
-
-
-
9,664,363
Total
B
4
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS FOR THE
YEAR ENDED 30 JUNE 2009
54
1. INTRODUCTION
Futebol Clube do Porto - Futebol, S.A.D. (“FCPorto, SAD”, “the Company” or “the Group”), with head
office at Estádio do Dragão Via F.C. Porto, Entrada Poente, 3rd Floor, 4350-451 Porto, was founded on 30
July 1997. The Group’s main activity considers the participation in professional football competitions
and the promotion and organisation of sporting events.
2. BASIS OF PRESENTATION AND MAIN ACCOUNTING POLICIES
The significant accounting policies used in the preparation of the accompanying consolidated financial statements are as follows:
2.1 Basis of Presentation
The accompanying consolidated financial statements have been prepared on a going concern basis
from the books and accounting records of the companies, adjusted to reflect International Financial
Reporting Standards - “IFRS” (previously referred to as International Accounting Standards – “IAS”),
issued by the International Accounting Standards Board (“IASB”) in force on 1 July 2008, as adopted
by the European Union.
New accounting standards and their impact on financial statements
Until the date of approval of these financial statements, the European Union endorsed the following
accounting standards and interpretations, some of which were in force during the financial year
ended 30 June 2009:
With mandatory application for the financial year ended 30 June 2009
Effective date
IAS 39/IFRS 7 - Amendments: reclassifications of Financial Instruments
01-07-2008
IFRIC 12 - Service Concession Arrangements
01-01-2008
IFRIC 13 - Customer Loyalty Programmes
01-07-2008
IFRIC 14 - IAS 19 The Limit on a Defined Benefit Asset, minimum Funding Requirements and their Interaction
01-01-2008
55
B4
Notes to the Consolidated Financial Statements for the Year ended 30 June 2009
With mandatory application after 30 June 2009
Effective date
IFRS 1/IAS 27 - Cost of an Investment in a subsidiary, Jointly Controlled Entity or Associate
01-01-2009
IFRS 2 - Amendments: Share-based Payment
01-01-2009
IFRS 3 - Amendments: Business Combinations
01-07-2009
IFRS 8 - Operating Segments
01-01-2009
IAS 1 - Presentation of Financial Statements (Reviewed)
01-01-2009
IAS 23 - Amendments: Borrowing Costs
01-01-2009
IAS 27 - Amendments: Consolidated and Separate Financial Statments
01-07-2009
IAS 32/IAS 1 - Amendments: Puttable Financial Instruments and Obligations Arising on Liquidation
01-01-2009
IAS 39 - Amendments: Eligible hedged items
01-07-2009
Amendments to International Financial reporting Standards (2007)
01-01-2009
IFRIC 15 - Agreements for the Construction of Real Estate
01-01-2009
IFRIC 16 - Hedges of a net Investment in a Foreign Operation
01-10-2008
The adoption of the amendments made to IAS 39/IFRS 7 and to IFRIC 12, IFRIC 13 and IFRIC 14 has
not led to any relevant changes to the consolidated financial statements as of 30 June 2009.
The standards endorsed by the European Union, mentioned above, have not been adopted by the
Group for the year ended 30 June 2009, as its application is not mandatory for this financial year and
the Group has decided not to early adopt them.
The application of these changes will not produce material changes in the future financial statements of the Group, with the exception of IFRS 8 which will change the disclosures regarding segment reporting.
As of this date, the following accounting standards and interpretations have already been issued but
not yet endorsed by the European Union:
Effective Date
IFRS 1 - Amendments: Cost of an Investment on First-time Adoption
01-01-2010
IFRS 2 - Amendments: group cash-settled Share-based Payment Transactions
01-01-2010
IFRS 7 - Amendments: Enhancing Disclosures about fair value and liquidity Risk
01-01-2009
Amendments to International Financial reporting Standards (2008)
01-07-2009/01-01-2010
IFRIC 17 - Distributions of Non-cash Assets to Owners
01-07-2009
IFRIC 18 - Transfers of Assets from Customers
01-07-2009
The future application of the standard mentioned above, which have not been endorsed by the European Union, is not expected to produce material impacts to the Group’s financial statements as of
30 June 2009.
2.2 Basis of Consolidation
The consolidation methods adopted by the Group in the preparation of the consolidated financial
statements are as follows:
56
a) Investments in Group companies
Investments in companies in which the Group owns, directly or indirectly, more than 50% of the voting
rights at Shareholders’ General Meetings or is able to establish financial and operational policies (definition of control used by the Group), are included in the consolidated financial statements using the full
consolidation method. Equity and net profit attributable to minority shareholders are shown separately,
under the caption “Minority interests”, in the consolidated balance sheet and in the consolidated income statement. Companies included in the consolidated financial statements using the full consolidation
method are listed in Note 5.
Adjustments to the financial statements of Group companies are performed, whenever necessary, and
relevant, in order to adapt accounting policies to those used by the Group. Intra-group balances and transactions are eliminated on consolidation.
b) Goodwill
Differences between the cost of acquisition of investments in Group companies and the fair value of the
identifiable assets and liabilities of those companies at the date of acquisition, when positive, are shown
as Goodwill (Note 10).
Goodwill is not amortised, being subject to impairment tests on an annual basis. Net recoverable amount
is determined based on business plans performed by the Group management or on valuation reports
issued by independent entities. Impairment losses recognized in the period are recorded in the income
statement under the caption “Provisions and impairment losses”. Impairment losses related with goodwill may not be reversed.
2.3 Main Accounting Policies
The main accounting policies used in the preparation of the consolidated financial statements are
as follows:
a) Tangible assets
Tangible assets acquired up to 1 July 2004 (transition date to IFRS) are recorded at deemed cost, which
corresponds to the acquisition cost net of accumulated depreciation and impairment losses recorded
up to that date.
Tangible assets acquired after that date are recorded at acquisition cost net of accumulated depreciation and impairment losses.
57
B4
Depreciation is calculated on a straight line basis, as from the date the assets are first used, over the
expected useful life for each group of assets. The expected useful life of the main groups of assets is
as follows:
Machinery and equipment: 4 to 10 years;
Vehicles: 3 to 8 years;
Office equipment: 3 to 8 years.
Maintenance and repair costs relating to tangible assets which do not increase their useful life nor
result in significant benefits or improvements are recorded directly as expenses in the period they
are incurred.
Gains or losses arising on sale or disposal of tangible assets are calculated as the difference between the selling
price and the carrying amount of the asset at the date of its sale/disposal; these are recorded in the income
statement under either “Other operational income” or “Other operational expenses”.
b) Intangible assets - Players’ registrations
The caption “Intangible assets - Players’ registrations” includes costs related with the acquisition
of players’ registrations, including intermediation service costs and signing-on fees paid directly
to the players in accordance with item 4, article 3 of Decree-Law 103/97 of 13 September. When the
percentage owned of players’ registrations is less than 100% (see Note 8), the Group is entitled to full
use of the player’s registration, but has entered into an associated financial interests contract with a
third party, which consists of an investment partnership in the registration rights, resulting in the
proportional sharing of the inherent results in future the transaction of these rights.
If a loss is estimated on realisation of a player’s registration (“impairment loss”), the corresponding
impact is recorded in the income statement of the financial year under the caption “Amortisation
and impairment losses of players’ registrations”. The identification and quantification of such impairment losses consider the carrying amount of players’ registrations as of 30 June 2009 of players
whose labour contracts have been terminated up to the approval date of the consolidated financial
statements.
Costs associated with securing the extension of a playing contract are also recorded under the caption “Intangible assets - Players’ registrations”, added to the carrying amount at the date of the amendment and that new
book value is amortised over the remaining revised contract life.
Costs included in the caption “Intangible assets - Players’ registrations” are amortised over the period covered by contracts celebrated between the players and the Group, in accordance with DecreeLaw 103/97 of 13 September.
58
Players on loan
The acquisition costs of players’ registrations who are on temporary loan to other clubs are maintained
in the caption “Intangible assets - Players’ registrations” and continue to be amortised over the contract
period. If a loss is estimated on the realisable value (“impairment loss”) of the players’ registrations on
loan up to the end of the contract period, the corresponding effect is recorded in the income statement of
the financial year under the caption “Amortisation and impairment losses of players’ registrations”.
c) Other intangible assets
Other intangible assets are stated at acquisition cost net of depreciation and accumulated impairment losses. Intangible assets are only recognised if it is probable that future economic benefits will
flow from them, if they are controlled by the Group and if their value can be reliably measured.
Depreciation is charged on a straight-line basis over the estimated useful life of the assets as from
the date the asset is first used (Note 7).
d) Lease and long term rental
Tangible assets acquired under finance lease contracts and the corresponding liabilities are recorded in
accordance with the financial method, when complying with the requirements of IAS 17 - “Leases”. Accordingly, tangible assets are recorded as assets and corresponding obligations as liabilities in the balance
sheet. Both the finance charge and the depreciation expense for depreciable assets, calculated as explained in Note 2.3.a), are taken to the income statement in the period in which they are incurred.
Long term rental instalments on assets acquired under this regime are recognised in full as expenses in
the period to which they refer.
Determination of whether contracts relate to finance leases or long term rentals is made based upon the
substance rather than the form of the contracts.
Operating lease instalments are recognised as expenses on a straight-line basis over the rental period.
e) Impairment of non-current assets, except for Goodwill
Assets are assessed for impairment whenever events or changes in circumstances indicate that the carrying
amount of an asset may not be recoverable.
Whenever the book value of an asset exceeds its recoverable amount, an impairment loss is recognised in
the profit and loss statement caption “Provisions and impairment losses excluding players’ registrations”.
The recoverable amount is the higher of an asset’s fair value less costs to sell and its value in
use. Fair value less costs to sell is the amount obtainable from the sale of an asset in an arm’s
length transaction between knowledgeable parties, less costs of disposal. Value in use is the
present value of estimated future cash-flow from the continued use of an asset and from its disposal at the end of its useful life. Recoverable amounts are estimated for each asset individually.
59
B4
Impairment losses recognised in prior years are reversed when it is concluded that the impairment
losses previously recognised no longer exist or have decreased. This assessment is made whenever
there is an indication that impairment losses previously recognised have been reversed. The reversal is recorded in the income statement caption “Other operating income”. However, reversal of the
impairment loss is recognised only up to the amount at which the asset would have been recorded
(net of depreciation) had no impairment loss been recognised for that asset in prior years.
f) Borrowing costs
Borrowing costs are recognised on an accruals basis in the income statement for the period in which
they are incurred.
g) Inventories
Inventories are stated at acquisition cost or net realizable value, whichever is lower, using the average cost as costing method.
Differences between cost and net realizable value, if negative, are shown as operating expenses under the caption “Cost of sales”.
h) Provisions
Provisions are recognised when, and only when, the Group has a present obligation (legal or constructive) as result of a past event, it is probable that a outflow of resources will be required to settle
the obligation, and a reliable estimate can be made of that obligation. Provisions are reviewed and
adjusted at the balance sheet date to reflect the best estimate as of that date.
i) Financial instruments
i) Investments
Investments are classified into the following categories:
• Held to maturity;
• Investments measured at fair value through profit or loss;
• Available-for-sale
Held to maturity investments are classified as non-current assets unless they mature within 12 months of the balance sheet date. Investments classified as held to maturity have defined maturities and
the Group has the intention and ability to hold them until the maturity date.
60
The investments measured at the fair value through profit or loss include the investments held
for trading that the Group acquires with the purpose of trading in the short term. They are classified in the consolidated balance sheet as current investments.
The Company classifies as available-for-sale investments those that are neither included as investments measured at fair value through profit or loss neither as investments held to maturity.
These assets are classified as non-current assets, except if the sale is expected to occur within 12
months from the date of classification.
All purchases and sales of investments are recognised on the trade date, independently of the
settlement date.
Investments are initially measured at cost, which is the fair value of the consideration paid for
them, including transaction costs.
Investments that do not have a quoted price and whose fair value cannot be reliably measured
are stated at cost less any impairment losses.
ii) Trade receivables and Other receivables
Non-current accounts receivables are measured at amortised cost using the effective interest
method, less any impairment.
Current account receivables are presented in the balance sheet, net of any impairment losses,
and are recorded at their nominal value, except when the effect of discounting is material, when
they are recorded at amortised cost using the effective interest method.
Accounts receivables are recorded as current assets, except when its maturity is greater than 12
months from the balance sheet date, when they are classified as non-current assets. These financial assets are included in the captions presented in Note 11.
Impairment is recognised if there is objective and measurable evidence that, as a result of one or
more events that occurred, the balance will not be fully received. Therefore, each group company
takes into consideration information that indicates:
• significant financial difficulty of the issuer or counterparty;
• default or delinquency in payments;
• it becoming probable that the counterparty will enter bankruptcy or financial re-organisation.
iii) Financial liabilities and Equity instruments
Financial liabilities and equity instruments are classified and recorded based upon their contractual substance. Equity instruments are contracts that evidence a residual interest in the assets of the Group after deducting all of its liabilities, and are recorded at the proceeds received,
net of direct issue costs.
61
B4
iv) Loans
Loans are recorded as liabilities at their nominal value net of transaction costs directly related
to the issuance of those instruments. Financial expenses are calculated based on the effective
interest rate and are recorded in the income statement on an accruals basis.
v) Trade payables and Other payables
Accounts payables are recorded at amortized cost using the effective interest method.
Current accounts payable are stated at their nominal value, unless the effect of discounting is
considered material, when they are recorded using the effective interest method.
The financing costs are calculated according to the effective interest rate, except for amounts
payable to very short-term securities which would be to recognize immaterial.
Accounts payable are classified as current liabilities, except in cases where the maturity is longer than 12 months of the balance sheet date, which are classified as non-current. These liabilities are included in the classes identified in Note 19.
vi) Discounted bills
Trade receivables represented by discounted bills that have not yet matured at the balance
sheet date remain recorded in the balance sheet until they are collected.
vii) Cash and cash equivalents
“Cash and cash equivalents” include cash on hand, cash at banks, term deposits and other treasury applications which mature in less than three months and are subject to insignificant risk
of change in value.
In the consolidated statement of cash-flows, “Cash and cash equivalents” also include bank overdrafts, which are included in the balance sheet caption “Bank loans”.
viii) Effective interest rate method
Effective interest rate method is a method of calculating the amortised cost of a financial asset
or liability and of allocating interest income or expense over the relevant period.
j) Contingent assets and liabilities
Contingent assets are possible assets arising from past events and whose existence will be confirmed
only by the occurrence or non-occurrence of one or more uncertain future events not within the
control of the Group.
62
Contingent assets are not recorded in the consolidated financial statements but disclosed when future economic benefits are probable.
Contingent liabilities are defined by the Group as (i) possible liabilities arising from past events, the
existence of which will only be confirmed by the occurrence, or not, of one or more uncertain future
events not under full control of the Group, or (ii) present obligations arising from past events, but
which are not recognised because it is unlikely that there will be an outflow of financial benefits to
settle the obligation or the amount of the obligation cannot be reliably measured.
Contingent liabilities are not recorded in the consolidated financial statements. Instead they are
disclosed in the notes to the financial statements, unless the probability of a cash outflow is remote,
in which case, no disclosure is made.
k) Income tax
As from the financial year ended 30 June 2007 the below mentioned group of companies, which
is dominated by Futebol Clube do Porto – Futebol, S.A.D., has been taxed in accordance with the
special regime for taxation of company groups (“Regime Especial de Tributação de Grupo de Sociedades” – “RETGS”), with the exception of Porto Seguro – Sociedade Mediadora de Seguros do Porto,
Lda., which joined the group in the financial year ended 30 June 2009.:
Futebol Clube do Porto – Futebol, S.A.D;
PortoComercial – Sociedade de Comercialização, Licenciamento e Sponsorização, S.A
PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, S.A.;
PortoSeguro - Sociedade Mediadora de Seguros do Porto, Lda.
Income tax for the year is determined based on the taxable results of the companies included in the
consolidation and takes into consideration deferred taxation.
According to existing Portuguese legislation, company’s tax returns included in the consolidation
are subject to revision and correction by the Tax Administration during a period of four years (five
years for Social Security), unless there were tax losses, have been granted tax benefits, or there are
ongoing inspections, complaints or disputes, these cases where, depending on the circumstances,
the deadlines are elongated or suspended. Thus, the tax situation on the years ended on 30 June 2006
to 30 June 2009 may still be subject to review and possible corrections.
The Board of Directors of the Parent-Company and its subsidiaries believe that any adjustments resulting from review by the Tax Administration and the tax situation for tax-businesses, for the years
in open, should not have a significant effect on the consolidated financial statements.
Under Article 81 of the Tax Code the corporate income businesses of the Group, are subject to additional taxation on a separate set of charges at the rates provided for in the referred article.
63
B4
Deferred taxes are calculated using the balance sheet liability method and reflect the temporary
differences between the amount of assets and liabilities for accounting purposes and the corresponding amounts for tax purposes. Deferred taxes are calculated using the tax rates expected to be in
force at the time the temporary differences are reversed.
Deferred tax assets are only recorded when there is reasonable expectation that sufficient taxable
profits will arise in the future to allow such deferred tax assets to be used or where there are temporary taxable differences that compensate temporary tax deductible differences in the period they
reverse. At the end of each period the Group reviews the deferred tax assets and reduces them whenever their realisation ceases to be likely.
l) Revenue recognition and accrual basis
i) Sales of goods
Revenue from the sales of goods (merchandising products) is recognised in the income statement when: (i) the significant risks and benefits of ownership of the assets have been transferred to the buyer, (ii) the Group does not retain continued management involvement of the asset
sold to a degree usually associated with ownership or effective control over it, (iii) the amount
of revenue can be reliably measured, (iv) it is likely that the economic benefits associated with
the transaction will flow to the Group, and (v) the costs incurred or to be incurred with the transaction can be reliably measured. Sales are recognised net of taxes, discounts and other costs,
including commissions, at the fair value of the amount received or receivable.
ii) Sale of players’ registrations
Gains or losses on disposal of players’ registrations are recorded in the income statement under
the caption “Income/(expenses) related to players’ registrations” and are calculated as the difference between the selling price and the carrying amount of the player’s registration at the date
of the sale and any other costs related directly with the sale, including intermediation service
costs. Whenever relevant, the effect of discounting future receipts to its present value is considered in the determination of the transaction result. Gains or losses on sale of players’ registrations
are recognised in the income statement when the significant risks and benefits of the player’s
registration have been transferred.
iii) Bonuses for participation in European Competitions
Fixed bonuses for obtaining the right to participate in the UEFA Champions League are recognised in the period in which participation is guaranteed, which is independent of the performance
in that competition. Variable bonuses depending on sporting performance are recorded in the
period the matches are played.
64
iv) Other income
Income relating to broadcasting rights, advertising and sponsorships is recorded in the income
statement in accordance with the duration period of the respective contracts. Income relating
to football matches is recognised in the period the matches are played.
Interest and financial income are recognised on an accruals basis at the applicable effective interest
rates.
Other income and expenses are recorded in the period to which they relate, regardless of their date
of payment or receipt. Differences between the amounts received or paid and the corresponding
income and expenses are recognised in captions “Other current assets”, “Other current liabilities”
and “Other non current liabilities”.
m) Foreign currency balances and transactions
All foreign currency assets and liabilities are translated to Euro at the official year-end exchange rates. Exchange gains and losses resulting from differences between the exchange rates in force on the
date of the transactions and those in force on the date of collections, payment or the balance sheet
date are recognised as gain or loss in the income statement of the period.
n) Subsequent events
Events after the balance sheet date that provide additional information on conditions existing at the
balance sheet date (adjusting events), are reflected in the consolidated financial statements. Events
after the balance sheet date that provide information about conditions arising after the balance sheet date (non-adjusting events), when material, are disclosed in the notes to the financial statements
(Note 33).
o) Judgement and estimates
The most significant accounting estimates reflected in the consolidated income statements include:
(i) Useful lives of tangible and intangible assets;
(ii) Impairment analysis of goodwill, of intangible assets - players’ registrations (Note 2.3.b)), and
of other tangible and intangible assets;
(iii) Recognition of adjustments on assets and provisions;
Estimates used are based on the best information available during the preparation of consolidated
financial statements and are based on best knowledge of past and/or present events. Although futu65
B4
re events are neither controlled by the Group nor foreseeable, some could occur and have impact on
the estimates. Changes to the estimates used by the management that occur after the date of these
consolidated financial statements, will be recognised in net income, in accordance with IAS 8, using
a prospective methodology.
p) Segment information
Every year, the Group’s most adequate applicable segments are identified considering the developed
activities.
Information regarding income by business segment is included in Note 30.
3. FINANCIAL RISK MANAGEMENT
Besides the risks inherent to the results of the sports’ activity and its’ impacts on the economic results and on the appreciation of its’ assets, the Group’s activity is exposed to a variety of financial
risks, such as market risk, credit risk and liquidity risk. These risks are the result of the uncertainty
inherent to the financial markets, which is reflected in the capacity to estimate future cash-flows
and returns. The Group’s risk management policy seeks to minimize any adverse effects arising
from these uncertainties characteristic of financial markets.
3.1. MARKET RISK
a) Interest rate risk
The interest rate risk is primarily result of loans indexed to variable interest rates.
The Group’s debt is mainly indexed to variable interest rates, exposing the cost of debt to a risk of
volatility. The impact of such volatility in the profits and equity of the Group is significant given the
high level of indebtedness of the Group.
Although the interest rate risk is significant, the Group does not, usually, use interest rate derivatives for hedging this risk.
As of 30 June 2009 and 2008, the Group presents a debt of approximately 91,056 thousand Euro and
81,664 thousand Euro, respectively, divided between current and non-current loans (Note 18) contracted with various financial institutions.
Sensitivity analysis of interest rate
The sensitivity analysis presented below was computed on the basis of the Group’s exposition to
changes in interest rate on financial instruments with reference to the estimate of average indeb66
tedness in the season 2008/2009. For financial instruments indexed to variable interest rates, the
analysis was prepared on the understanding that changes in market interest rates only affect interest income or expenses of financial instruments indexed to variable interest rates.
The referred analysis pointed out that if the Euribor had been 50 basis points higher and the other
variables held constant, the financial charges for the year ended 30 June 2009 would increase by,
approximately 215 thousand Euro (200 thousand Euro in the financial year ended 30 June 2008).
b) Exchange rate risk
Developing its activity, the Group carries out some transactions denominated in currencies other than
Euro, namely transactions of players’ registrations. However, such transactions in foreign currency
have been not significant, being the vast majority contracted in Euro, and residually in U.S. dollars.
Thus, the Group does not use derivatives for hedging, namely exchange rates forwards.
3.2. CREDIT RISK
The Group’s exposition to credit risk is mainly related with accounts receivable arising from the sale
of players’ registrations and other transactions related with the Group’s activity, namely the sale of
broadcasting rights, advertising and sponsorships. The credit risk refers to the risk of a counterparty
defaulting on its payment contractual obligations, resulting in a financial loss to the Group.
The objective of this risk management is to ensure the effective credit collections on established
deadlines without affecting the Group’s financial stability. The evaluation of this risk is made on
a regular basis, and the management’s goal is (a) to evaluate the counterparty in order to assess its
ability to pay the debt, (b) to monitor the evolution of the amount of trade receivables, and (c) to
perform an impairment analysis of accounts receivables on a regular basis.
The Group does not consider there is significant credit risk with any entity in particular, or with
a group of entities with similar characteristics, to the extent that accounts receivables are spread
across various customers and different geographical areas. The Group asks for credit guarantees,
when the financial position of the client recommends so. For customers with higher credit risk,
these guarantees should be bank guarantees.
Impairment losses related to accounts receivables are calculated taking into consideration: (a) the
client’s risk profile, (b) the term of collection of each contract, which differs in each line of business,
and (c) the customer’s financial conditions. Changes in accumulated impairment losses for the years ended 30 June 2009 and 2008 are disclosed in Note 21.
As of 30 June 2009 and 2008, the Group considers that there is no need to book additional impairment losses besides the amounts recorded on those dates and summary disclosed in Note 21.
67
B4
3.3. LIQUIDITY RISK
Liquidity risk is defined as the risk of lack of ability to settle or accomplish its obligations on stipulated time and reasonable price. The existence of liquidity implies that management parameters are
set which maximize the return and minimize the opportunity costs associated with the liquidity in
a safe and efficient manner.
The risk management in the Group aims to:
• Liquidity - ensure the permanent and efficient access to funds to meet correct payments to the
respective due dates;
• Security - minimize the probability of default in the refund of any application of funds; and
• Financial efficiency -minimise the cost of opportunity of excessive short term liquidity.
The Group aims to make compatible the due dates of assets and liabilities through an active management of its maturities. As a rule, each contract loan is guaranteed by a receivable account balance (due
to player’s registration sale or due to receivables amounts related to European competitions bonuses);
additionally, the maturity dates of such loans match the due dates of the accounts receivables.
The information considered in the notes to the consolidated financial statements, regarding the maturity analysis of financial liabilities includes the due amounts, not discounted, based upon the worst case
scenario, which is, the shortest period in which the liability becomes due, assuming the compliance of
all requirements set contractually.
4. CHANGES IN ACCOUNTING POLICIES AND CORRECTION OF ERRORS
During the year there were no changes in accounting policies or prior period errors.
68
5. GROUP COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENTS
The companies included in the consolidation by the full consolidation method (Note 2.2.a), their
head offices and the percentage of share capital held by the Group as of 30 June 2009 and 2008 are
as follows:
Company
Head Office
Percentage participation
Percentage participation
held 30.06.2009
held 30.06.2008
Futebol Clube do Porto - Futebol, S.A.D.
Porto
Parent company
Parent company
PortoComercial - Sociedade de Comercialização, Licenciamento e
Sponsorização, S.A. (“PortoComercial”)
Porto
93,5%
93,5%
F.C.PortoMultimédia - Edições Multimédia, S.A. (“PortoMultimédia”)
Porto
70%
70%
PortoEstádio - Gestão e Exploração de Equipamentos Desportivos, S.A. (“PortoEstádio”)
Porto
100%
100%
PortoSeguro - Sociedade Mediadora de Seguros do Porto, Lda. (“PortoSeguro”)
Porto
90%
90%
6. CHANGES TO THE CONSOLIDATION PERIMITER
During the financial year ended 30 June 2009 there were no changes in the scope of consolidation.
69
B4
7. TANGIBLE AND INTANGIBLE ASSETS
During the years ended 30 June 2009 and 2008, the movements in tangible and other intangible assets, as well as depreciation and accumulated impairment losses, were as follows:
Tangible assets
30.06.2009
Building
Gross cost:
Opening balance (30.06.2008)
Additions
Sales
Write-offs
Transfers
Closing balance (30.06.2008)
Accumulated depreciation and impairment losses:
Depreciation
Impairment losses
Sales
Write-offs
Transfers
Carrying amount
Machinery
and other
and
constructions
equipment
Vehicles
equipment
Office
Others
Total
771,225
40,373
-
2,313,865
136,888
-
1,224,489
429,167
-
256,000
-
6,502,951
752,850
(251,632)
-
-
1,937,372
146,422
(251,632)
39,750
-
-
-
-
811,598
2,450,753
1,792,412
1,653,656
256,000
6,964,419
326,,858
76,485
-
1,211,884
247,451
-
1,157,167
304,981
(225,416)
(39,750)
-
735,093
279,399
-
130,670
30,167
-
3,561,672
938,483
(225,416)
(39,750)
-
403,343
1,459,335
1,196,982
1,014,492
160,837
4,234,989
408,255
991,418
595,430
639,164
95,163
2,729,430
Tangible assets
30.06.2008
Buildings
and other
Machinery
constructions
equipment
Machinery
equipment
Others
Total
Gross cost:
Additions
Sales
Write-offs
Transfers
767,588
3,637
-
2,288,142
25,723
-
1,860,590
312,158
(235,376)
-
1,054,484
147,856
22,149
255,795
205
-
6,226,599
489,579
(235,376)
22,149
771,225
2,313,865
1,937,372
1,224,489
256,000
6,502,951
254,914
71,944
-
944,398
267,486
-
975,909
354,479
(173,221)
-
561,306
173,787
-
100,283
30,387
-
2,836,810
898,083
(173,221)
-
326,858
1,211,884
1,157,167
735,093
130,670
3,561,672
444,367
1,101,981
780,205
489,396
125,330
2,941,279
Accumulated depreciation and impairment losses:
Depreciation
Impairment losses
Sales
Transfers
Write-offs
Carrying amount
Office
70
30.06.2009
Industrial property
Intangible assets
and other rights
Others
in progress
Total
Gross cost:
Additions
Transfers
Sales and wirte-offs
2,339,706
-
11,488
-
-
2,351,194
-
2,339,706
11,488
-
2,351,194
554,878
25,450
-
8,177
902
-
-
563,055
26,352
-
580,328
9,079
-
589,407
1,759,378
2,409
-
1,761,787
Accumulated amortisation and impairment losses:
Depreciation
Impairment losses
Sales and write-offs
Carrying amount
30.06.2008
Industrial property
Intangible assets
and other rights
Others
in progress
Total
Gross cost:
Additions
Transfers
2,339,706
-
11,488
-
26,800
(26,800)(*)
-
2,377,994
(26,800)
-
2,339,706
11,488
-
2,351,194
532,723
22,155
-
7,275
902
-
-
539,998
23,057
-
Depreciation
Impairment losses
Carrying amount
554,878
8,177
-
563,055
1,784,828
3,311
-
1,788,139
(*) Amount reclassified to tangible assets
The caption “Industrial property and other rights” relates to the right of use of the FCP trademark
during a period of 99 years, and is being amortised over that period.
71
B4
8. INTANGIBLE ASSETS - PLAYERS’ REGISTRATIONS
During the financial years ended 30 June 2009 and 2008, the movements token place under the caption “Players’ registrations” as well as depreciation and accumulated impairment losses, were as
follows:
Intangible asset - Players’ registrations
Gross cost:
Opening balance
Acquisitions
Sales
Transfers (Note 9)
Write-offs
Closing balance
Opening balance
Depreciation (Note 26)
Impairment losses (Note 26)
Sales
Transfers (Note 9)
Write-offs
30.06.2009
30.06.2008
86.863.458
42.302.746
(23.815.948)
(9.620.064)
76.314.034
39.872.772
(12.422.496)
(4.441.026)
(12.459.826)
95.730.192
86.863.458
36.184.583
22.080.849
1.689.122
(12.480.518)
(9.620.064)
39.761.033
18.927.320
1.156.282
(7.647.395)
(3.552.821)
(12.184.593)
Closing balance
37.853.972
36.184.593
Carrying amount
57.876.220
50.678.865
Acquisitions
Among the acquisitions made in the year ended 30 June 2009, the following ones represent approximately 84% of acquisitions value:
a) 70% of Cristian Rodriguez registration;
b) 100% of Pelé registration, this acquisition was made under the sale of Ricardo Quaresma’s registration, as explained below;
c) 50% of Hulk and Sapunaru registrations;
d) 80% of Álvaro Pereira registration;
e) 60% of Orlando Sá registration;
f) 100% of Mariano Gonzalez registration;
g) Charges for the renegotiation of the labour contract with Lucho Gonzalez.
It should be noted that in situations where the registration is less than 100%, although the Group is entitled to full use of the player’s registration, it has entered into an associated financial interests contract
with a third party, which consists of an investment partnership in the registration rights, resulting in the
proportional sharing of the inherent results in future the transaction of these rights.
72
The remaining charges are related, mainly, with the purchase of Guarín, Maicon, Miguel Lopes, Cissokho and Beto registrations and with charges incurred in negotiating the employment contract
with Varela and also other charges taken upon in the renegotiation of the labour contracts of Raul
Meireles and Fernando, under which their term were extended.
For the financial year ended 30 June 2008, the acquisition cost of registrations of Lucho Gonzalez and
Lisandro Lopez (50% each), Stepanov, Farías, Tomás Costa and Bolatti represented about 82% of the
total charges with acquisitions made in that year.
The charges for intermediation services related with the purchase of players’ registrations in the
years ended 30 June 2009 and 2008 referred above, as well as with the negotiation and renegotiation
of labour contracts, amounted to, approximatelly 3,000,000 Euro and 1,265,000 Euro respectively.
In the financial year ended 30 June 2009 these services were, essentially, provided by Schuchard SPI
Services, Bedrijfsundig Adviesbureau A.L. Duivenboden B.V., Deaubert B.V., Onsoccer International
- Gestão e Marketing Lda., Pacheco e Teixeira Lda., S Bass, Unifoot - Gestão de Eventos e Carreiras
de Profissionais Desportivos S.A., Football - Assesoria Esportiva Ltda., Avendi 5L, and by the agents
Victor Becali and Federico Martin Simonian.
In the financial year ended 30 June 2008 intermediation services were provided, mainly, by HAZ
Sport Agency, S.A., KFM, Onsoccer International - Gestão e Marketing Lda., Forsoccer S.A., Continental Services B.V., and by the agent Mohamed Afzal Mamade Sualehe.
The amount of registrations’ acquisitions in the period ended 30 June 2009 considers the effect of
discounting future payments to its present value in the amount of, approximately, 2,200,000 Euro, of
the long term account payables balances related with the acquisition of the registrations of players,
namely Cristian Rodriguez and Pelé.
Sales
Sales made during the financial year ended 30 June 2009 generated capital gains of 34,589,685 Euro
(net of (i) intermediation service costs in the amount of 3,642,500 Euro; (ii) liabilities relating to the
“solidarity mechanism” in the amount of 1,077,500 Euro; and (iii) of the effect of discounting future
receipts and payments to its present value arising from these transactions, amounting to, approximately, 2,500,000 Euro), which resulted mainly from:
a) Sale of the registration of Ricardo Quaresma to F.C.Internazionale Milano (“Inter Milan”) by the
amount of 24,600,000 Euro, to which added the income related with the fulfillment of the objectives’ clauses considered in the sale’s contract in the amount of 4,000,000 Euro, net of: (i) costs of
intermediation services provided by Gestifute – Gestão de Carreiras de Profissionais Desportivos,
S.A.; (ii) liabilities related with the “solidarity mechanism”; (iii) the net effect of discounting the
accounts receivable and payable in the long term that arose from this transaction to their net
73
B4
present value; (iv) the carrying amount of the player’s registration on the date of sale; and (v) the
annulment of under processing signing-on fees;
b) Sale of the registration of Lucho Gonzalez to Olympique de Marseille (“Marseille”) by the amount of
18,000,000 Euro, net of: (i) costs of intermediation services provided by the entity LGH – Larkin Geaney
Hughes Limited; (ii) the net effect of discounting the accounts receivable and payable in the long term
that arose from this transaction to their net present value; (iii) the carrying amount of the player’s
registration on the date of sale; and (iv) the annulment of under processing signing-on fees;
c) Sale of the registration of Paulo Machado to SASP Toulouse Football Club (“Toulouse”) by the
amount of 3,500,000 Euro, net of: (i) costs of intermediation services provided by the entity Forsoccer - Gestão de Carreiras de Profissionais Desportivos, S.A.; (ii) the net effect of discounting
the accounts receivable and payable in the long term that arose from this transaction to their net
present value; (iii) the carrying amount of the player’s registration on the date of sale; and (iv) the
rescission of the purchase option with AS Saint-Etienne;
d) Sale of the registration of Marek Cech to West Bromwich Albion by the amount of 1,700,000 Euro,
net of: (i) costs of intermediation services provided by the entity Central Sports Management; (ii)
liabilities related with the “solidarity mechanism”; and (iii) the carrying amount of the player’s
registration on the date of sale.
Also note that the sale of 15% of the economic rights of the player Pele to the entity Gestifute – Gestão de Carreiras de Profissionais Desportivos, S.A., did not cause any impact on net profit for the year
ended 30 June 2009.
Sales of the registrations of Ricardo Quaresma and Lucho Gonzalez contributed, approximately, to
90% of total net capital gains recorded in the financial year ended 30 June 2009.
Sales occurred during the year ended 30 June 2008 generated capital gains of 37,353,362 Euro (net of,
(i) intermediation service costs in the amount of 2,850,000 Euro; (ii) liabilities relating to the “solidarity mechanism” of 1,093,125 Euro and (iii) the net effect of discounting the accounts receivable and
payable in the long term that arose from these transactions to their net present value in the amount
of., approximately, 1,230,000 Euro) of which approximately 95% are related with the net capital
gains from the sale of the registrations of the players Pepe and Bosingwa.
74
Players’ registrations
As of 30 June 2009 and 2008, the carrying amount of the players’ registrations, considering the different ranges below, is made up as follows:
30.06.2009
Carrying amount of players registrations
Greater than 2.million Euro
Between 1 and 2.million Euro
Less than 1 million Euro
Nº of players
11
7
20
30.06.2008
Accumulated amount
40.270.076
9.399.399
8.206.745
Nº of players
7
8
20
Accumulated amount
32.887.330
10.894.520
6.897.015
57.876.220
50.678.865
The carrying amount of Players’ registrations, as of 30 June 2009 and 2008, includes the following
amounts related with the more significant charges incurred with the acquisition of players’ registrations which represent 86% of the caption balance:
30.06.2009
Player
Cristian Rodriguez
Álvaro Pereira
Hulk
Lisandro Lopez
Pelé (*)
Tomás Costa
Orlando Sá
Stepanov (*)
Farías
Mariano Gonzalez
Sapunaru
Maicon
Bolatti (*)
Nelson Benitez (*)
Leandro Lima (*)
Raul Meireles
Renteria (*)
Rolando
Players registrations (%)
70%
80%
50%
100%
85%
75%
60%
100%
100%
100%
50%
50%
60%
50%
90%
100%
50%
80%
End of contract
Jun-12
Jun-14
Jun-13
Jun-11
Jun-12
Jun-12
Jun-13
Jun-11
Jun-11
Jun-11
Jun-13
Jun-14
Jun-11
Jun-12
Jun-13
Jun-12
Jun-11
Jun-13
30.06.2008
Players registrations (%)
100%
75%
100%
100%
60%
50%
90%
100%
50%
75%
(*) Player loaned to another football Club or Entity during the 2009/10 season, but which loan’s period is not beyond 30 June 2010.
75
End of contract
Jun-11
Jun-12
Jun-11
Jun-11
Jun-11
Jun-12
Jun-13
Jun-12
Jun-11
Jun-13
B4
9. INVESTMENTS HELD FOR SALE
During the years ended 30 June 2009 and 2008, the movements under the caption “Investments held
for sale” as well as accumulated impairment losses, were as follows:
Investments held for sale
30.06.2009
30.06.2008
Gross cost:
Opening balance
Additions
Transfers (Note 8)
Write-offs
901.226
-
1.013.021
888.205
(1.000.000)
Closing balance
901.226
901.226
-
1.000.000
(1.000.000)
Accumulated impairment losses:
Opening balance
Impairment losses
Transfers
Write-offs
Closing balance
Carrying amount
-
-
901.226
901.226
As of 30 June 2009 the caption “Investments held for sale”, besides residual investments in the
amount of 13,021 Euro, considers 50% of the carrying amount of the registration of Helder Postiga,
corresponding to the economic rights that the Group maintained in relation with that player, whose registration was sold to Sporting – Sociedade Desportiva de Futebol, SAD (“Sporting SAD”) during
the year ended on 30 June 2008.
In accordance with the contract celebrated in the financial year ended 30 June 2008, Sporting SAD
has pledged to pay 50% of the economic rights arising from a future transfer of the player Hélder
Postiga, if that transaction is held during the term of the labour contract that Sporting SAD has celebrated with the player (at least 3 years), including any extension of this contract, or alternatively,
the amount of 2,500,000 Euro if Sporting SAD prefers to maintain the existing playing contract with
the player and not sell his registrations’ rights.
10. GOODWILL
During the financial year ended 30 June 2009 there was not any movement under the caption “Goodwill”.
The balance of this caption as of 30 June 2009 is related with the acquisition of 90% of the share capital of
PortoSeguro, Lda. during the year ended 30 June 2007.
The Group carries out annual impairment tests on goodwill and whenever there are indications that
it may be impaired. During the years ended 30 June 2009 and 2008, the Group has tested the goodwill
impairment, not having estimated any relevant impairment loss.
76
For impairment assessment purposes, it was considered that the goodwill was allocated only to the Cash
Generating Unit of insurance intermediation business. The recoverable amount of the Cash Generating
Unit was calculated based of value in use, using the discounted cash flow method, based on the business
plan developed by the company’s representative and duly approved by the Group’s Board of Directors.
The key assumptions used in the referred business plan are as follows:
Period used:
7 years
cash-flow projection
Growth rate (g) (1):
2.15%
Discount rate (2):
12.5%
(1)
Growth rate used to extrapolate cash flows beyond the business plan period
(2)
Discount rate applied to projected cash flows
The Board of Directors base on the discounted value of the provisional cash flows of the Cash Generating Unit of this business segment, discounted at the rate of 12.5%, concluded that, as of 30 June 2009,
the carrying amount of the net assets, including Goodwill, does not exceed its recoverable amount.
The projected cash flows were based on the historic performance and on the expectations regarding
future development of the business. The Company’s management believes that a change in the main
assumptions used in the calculation of the recoverable amount will not result in impairment losses.
11. TRADE RECEIVABLES
Non-current assets
The detail of non-current balances of “Trade receivables” as of 30 June 2009 and 2008 is as follows:
30.06.2009
30.06.2008
Trade receivables:
Transactions of player’s registrations
20.889.500
-
Trade receivables - bills receivables:
Transactions of player’s registrations
6.666.668
14.998.332
(1.878.345)
(1.338.587)
25.677.823
13.659.745
Effect of discounting trade receivables
77
B4
The balance of “Non-current assets - Trade receivables” as of 30 June 2009 refers to customers’ accounts
receivable related with players’ transactions, which due date is greater than one year. This balance is
mainly consisted of the accounts receivable from Real Madrid, Inter Milan and Marseille related with
the sale of the registrations of the players Pepe, Ricardo Quaresma and Lucho Gonzalez, respectively.
As of 30 June 2008 this same balance refers mainly to accounts receivable from Real Madrid.
On the balance sheet date, there are no non current accounts receivables overdue and no impairment
loss was recognized, as there is no indication that trade debtors will not fulfill their obligations.
Current assets
The detail of current balances of “Trade receivables” as of 30 June 2009 and 2008 is as follows:
Trade receivables - current accounts:
Transactions of players’ registrations
Current operations
Trade receivables - bills receivable:
Current operations
Trade receivables - doubtfull accounts:
Effect of discounting trade receivables
Accumulated impairment losses (Note 21)
30.06.2009
30.06.2008
24.072.536
25.561.582
19.998.229
14.609.362
44.070.765
40.170.944
6.866.666
6.816.666
9.270.000
9.815.016
16.136.666
16.631.682
3.839.845
1.829.730
64.047.276
58.632.356
(95.724)
(151.591)
(3.839.845)
(1.820.226)
60.111.707
56.660.539
As of 30 June 2009, the caption “Trade receivables – Current accounts - Transactions of players’ registrations” includes the amounts of 10,000,000 Euro to be received from Marseille, 6,409,750 Euros receivable from Inter Milan and the remaining to be received from Athletic Madrid, Toulouse and Sporting
SAD. The account receivable from Inter Milan is deducted from the account payable to the same entity
and with the same terms, for the acquisition of Pelé’s registration.
The caption “Trade receivables - Current accounts - Transactions of players’ registrations” as of 30 June
2008 includes the amounts of 16,500,000 Euro to be received from Manchester United, 5,000,000 Euros
receivable from Chelsea and 3,025,000 Euros to be received from Sporting SAD, which with the exception of receivable from Sporting SAD, that hasn´t reach his maturity, have already been charged.
The balance of the caption “Trade receivables - Current Accounts - Current operations” includes balances resulting from several operations, with emphasis on the balances to be collected from Futebol
Clube do Porto (9,299,938 Euro and 7,235,802 Euro as of 30 June 2009 and 2008, respectively - Note 28),
78
from Euroantas, Promoção e Gestão de Empreendimentos Imobiliários S.A. (“Euroantas”) (4,013,755
Euro and 114,341 Euro as of 30 June 2009 and 2008, respectively – Note 28), from Portugal Telecom
SGPS SA (2,460,000 Euro and 2,420,000 Euro as of 30 June 2009 and 2008, respectively) and from
other entities, such as Sportinveste - Multimédia, S.A., Olivedesportos - Publicidade Televisão e Media, S.A., Sacentro – Comércios de Têxteis, S.A. and TMN - Telecomunicações Móveis Nacionais, S.A.,
whose aggregate balances amounted to approximately 2,100,000 Euro and 1,065,000 Euro as of 30
June 2009 and 2008, respectively.
The balance of the caption “Trade receivables – bills receivable” as of 30 June 2009 includes bills not
due at the balance sheet date, part of which were discounted (15,936,666 Euro and 7,223,700 Euros
as of 30 June 2009 and 2008, respectively - Note 18). These bills are related with the sale of broadcast
rights in the amount of 9,270,000 Euro and with the sale of the registration of Pepe to Real Madrid in
the amount of 6,666,666 Euro, similar situation to the one as of 30 June 2008.
The Group’s exposition to credit risk is attributed to accounts receivable relating with its’ operational activity. The amounts presented on the face of the balance sheet are net of impairment losses,
which were estimated, based upon the Group’s past experience and on the assessment of the actual
situation and economic environment. The Group considers that the book value of accounts receivable, net of impairment losses, reflect their fair value.
As of 30 June 2009 there is no indication that the debtors of trade accounts receivable not due will
not fulfil their obligations on normal conditions, thus no impairment loss was recognised.
As of 30 June 2009 and 2008 the ageing of trade receivables are as follows:
Due Date
30.06.2009
Trade receivables - current accounts
Current operations
Trade receivables - bills receivable
Trade receivables - doubtfull accounts
Total
- 90 days
90 - 180 days
180 - 360 days
+ 360 days
44,070,765
28,820,040
2,339,215
7,229,737
5,681,773
24,072,536
19,998,229
22,909,697
5,910,343
21,600
2,317,615
630,585
6,599,152
510,654
5,171,119
16,136,666
3,839,845
16,136,666
-
48,000
58,238
3,733,607
64,047,276
44,956,706
2,387,215
7,287,975
9,415,380
Due Date
30.06.2008
Trade receivables - current accounts
Current operations
Trade receivables - bills receivable
Trade receivables - doubtfull accounts
79
Total
- 90 days
90 - 180 days
180 - 360 days
+ 360 days
40,170,944
29,847,587
4,206,425
2,640,191
3,476,741
25,561,585
14,609,359
23,154,965
6,692,622
1,853,771
2,352,654
2,84,089
2,356,102
268,760
3,207,981
16,631,682
1,829,730
16,631,682
480,043
162,500
-
1,187,187
58,632,356
46,959,312
4,368,925
2,640,191
4,663,928
B4
As of 30 June 2009, the amount due over 180 days of the caption “Trade receivables – current accounts – current operations” is composed, mainly, by the accounts receivable from Futebol Clube do
Porto and Euroantas, while as of 30 June 2008, the amount is composed mainly by the account receivable from Futebol Clube do Porto. According to the minute of the meeting of the Directors of Futebol Clube do Porto, held during July 2009, it has been reaffirmed the objective of paying the referred
debt to FCP SAD in the short term, which will imply the disposal of non sporting real estate assets of
that Club, namely a land and offices in Torre das Antas, as well as defining a debt settlement.
In determining the recoverability of trade receivables, the Group reviews any change in the credit
quality of the counterpart from the date credit was initially granted up to the reporting date of the
consolidated financial statements. The Group doesn’t have significant concentration of risk credit,
as the risk is diluted by a spread group of clients. Management believes the credit risk is not higher
than the impairment loss booked for doubtful accounts, and that the maximum exposition to the
credit risk is the amount presented in the consolidated balance sheet.
12. INVENTORIES
From 1 July 2008, PortoComercial started to manage and operate directly the commercial areas of FC
Porto, due to the amendment of the contract, signed on 31 March 2006 with TBZ – Marketing Acções
Promocionais, S.A. (“TBZ”), of management and exploitation of commercial areas of FC Porto, on 30
June 2008.
This caption as of 30 June 2009 and 2008 is made up as follows:
30.06.2009
680.237
Inventories
Accumulated impairment losses on inventories (Note 21)
30.06.2008
43.800
(62.309)
-
617.928
43.800
The cost of sales, for the years ended 30 June 2009 and 2008, were calculated as follows:
Opening balances
Purchases
Adjustments
Closing balance
Impairment losses (Note 21)
30.06.2009
43.800
30.06.2008
44.703
2.037.198
(32.799)
(903)
680.237
43.800
1.367.962
-
62.309
-
1.430.271
-
80
13. OTHER CURRENT AND NON-CURRENT ASSETS
Other non-current assets
30.06.2009
14.963.937
30.06.2008
14.963.937
433.735
-
15.397.672
14.963.937
30.06.2009
1.851.449
847.189
30.06.2008
1.478.653
1.067.756
7.100.000
238.007
137.725
639.398
5.400.000
616.000
3.679.971
141.357
549.518
8.115.130
10.386.846
10.813.768
12.933.255
30.06.2009
793,156
6,159,194
15,000
30.06.2008
556,680
2,948,699
13,000
Cash and cash equivalents
6,967,350
3,518,379
Bank overdrafts (Note 18)
(17,032)
(42,048)
6,950,318
3,476,331
Prepayment - rent “Estádio do Dragão” (Nota 31)
Prepayment - rent Centro de Treinos do Olival
State and public sector
Other debtors
Champions league participation bonus (Note 2.3. I) iii)) to be received
Advertising revenue to be billed
Euro 2008 players participation bonus
“Lugares Euroantas” to be billed
Deferred expenses - Assurance
14. CASH AND CASH EQUIVALENTS
The caption “Cash and cash equivalents” as of 30 June 2009 and 2008 is made up as follows:
Cash
Bank deposits repayable on demand
Treasury applications
81
B4
15. TAXES
The Group has not recognised deferred taxes as there are no significant temporary differences between the amounts of expenses and income recognised for accounting and for tax purposes, except
for deferred tax assets relating to tax losses carried forward and non tax deductible provisions and
impairment losses, which were not recognised for reasons of prudence.
The tax losses carried forward of the companies included in the consolidation perimeter amount to
38,772,095 Euro and expire as follows:
Amount
Expiry date
Generated in the year ended:
30 June 2004
88.959
30 June 2010
30 June 2005
2.001.166
30 June 2011
30 June 2006
26.004.394
30 June 2012
30 June 2007
27.100
30 June 2013
30 June 2008
105.830
30 June 2014
30 June 2009
10.544.646
30 June 2015
38.772.095
The tax losses detailed above do not consider any adjustments made by tax authorities to tax base,
which were contested by the Company (Note 21) and where the outcome of these processes is still
uncertain.
82
Following is the reconciliation between profit before income tax and income tax for the year:
30.06.2009
30.06.2008
Profit before income tax
5.702.387
8.833.978
Impact of transition adjustments to IFRS
1.233.486
473.328
Profit for purpose of calculating income tax
6.935.873
9.307.306
Increases:
Non tax deductible amortisation and depreciation
89.968
101.431
Non tax deductible provisions (Note 21)
Taxable gains (1)
Non tax deductible adjustments
Other
Decreases:
Accounting gains (1)
Reversal of non tax deductible adjustments
Other
158.167
18.333.815
535.528
575.751
38.501.391
389.658
279.742
(37.034.489)
(7.662)
(38.669.740)
(1.239.898)
(1.420)
Taxable profit
(10.413.049)
8.668.470
-
(6.427.036)
(10.413.049)
2.241.434
25,00%
25,00%
Offset of tax losses carried forward
Tax base
Income tax rate
Municipal tax rate
1,50%
1,50%
-
700.852
Calculated tax
Municipality tax (2)
11.419
-
Autonomous taxation
165.247
84.602
Provision for additional corporate income tax assessments (Note 21)
158.167
-
Corporate income tax assessments (Note 21)
220.261
-
Income tax for the year
555.094
785.454
(1) Calculating the taxable profit, the Group chose to consider the reinvestment of capital gains on the sale players’ registrations, in legal terms, wich
allowed to deduct 50% of tax capital gains generated.
(2) municipality tax of companies taxed according to RETGS and which present taxable profit for the year ended 30 June 2009
16. SHARE CAPITAL
The Company’s fully subscribed and paid for capital as of 30 June 2009 is made up of 15,000,000
nominal shares of 5 Euro each.
As of 30 June 2009 the following entities held more than 20% of the subscribed share capital:
- Futebol Clube do Porto – 40%
83
B4
The financial statements of Futebol Clube do Porto – Futebol, SAD as of 30 June 2009 reflect shareholders’ equity of less than half of the share capital, therefore Article 35 of the Portuguese Commercial
Code (Código das Sociedades Comerciais) is applicable. As mentioned in the Board of Director’s
Report, the Board of Directors of FC Porto SAD believes that, considering the profits generated in
the financial year 2008/2009 and the estimated budget for fiscal year 2009/2010 to be presented at
the Shareholders’ General Meeting, the capital structure of the Company will come out naturally
reinforced. Even without reaching the objective referred to in Article 35 of the Portuguese Commercial Code, the Board of Directors is convinced that the improvement of economic and financial
performance will continue in the coming years, and so will comply with that article. Additionally,
the Board of Directors provides that in the presentation of the 1st quarter of 2009/2010 financial
statements, the exploration results presented will enable the Company to comply with the Article
35 of the Portuguese Commercial Code.
Even though, and with the goal to quickly fulfil this obligation, the Board of Directors has been analysing other solutions that allow the reinforcement of shareholders’ equity. The Board of Directors besides planning to review this matter on the Shareholders’ General Meeting held to approve the accounts
for the year, may also call upon an Extraordinary Shareholders’ General Meeting to discuss and approve the proposals that will be presented, which can include the following alternatives:
• Capital decrease to an amount not less than the Company’s shareholders’ equity;
• Capital increase paid up by the shareholders; and
• A combination of these two alternatives.
17. MINORITY INTERESTS
The changes in minority interests during the years ended 30 June 2009 and 2008 were as follows:
Initial balance as at 1 July 2007
Net consolidated profit for the year attributable to minority interest
Other changes
125.735
84.075
(3.591)
Closing balance as at 30 June 2008
206.219
Initial balance as at 1 July 2007
Net consolidated profit for the year attributable to minority interest
Dividends distributed of by Porto Comercial
Other changes
206.219
12.073
(78.000)
789
Closing balance as at 30 June 2009
141.081
84
18. BANK LOANS AND OTHER LOANS
The captions “Bank loans” and “Bonds” as of 30 June 2009 and 2008 are made up as follows:
30.06.2009
Amortized Cost
Nature
Bank loans
Credit on current accounts
Discounted bills (Note 11)
Bonds
Nominal value
Current
Non-current
Current
Non- current
34.930.645
4.300.000
15.936.666
17.032
21.000.666
-
34.930.645
4.300.000
15.936.666
17.032
21.000.666
-
55.184.343
21.000.666
55.184.343
21.000.666
141.871.385
-
15.000.000
-
70.055.728
21.000.666
70.184.343
21.000.666
30.06.2008
Amortized Cost
Nature
Bank loans
Credit on current accounts
Discounted bills (Note 11)
Bonds
Nominal value
Current
Non-current
Current
Non-current
35.483.333
2.200.000
7.223.700
42.048
15.457.913
6.666.666
-
35.483.333
2.200.000
7.223.700
42.048
15.457.913
6.666.666
-
44.949.081
22.124.579
44.949.081
22.124.579
-
14.590.771
-
15.000.000
44.949.081
36.715.350
44.949.081
37.142.579
As of 30 June 2009 the repayment schedule of the nominal value of non-current loans may be summarized as follows:
30.06.2009
16,532,666
4,468,000
2010/2011
2011/2012
21,000,666
The presented nominal value corresponds to the amount due. Amortized cost corresponds to the
nominal value less costs incurred with the financing structuring.
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Following is information on the loans as of 30 June 2009 and 2008:
i) In December 2006 FCPorto, SAD concluded a Public Subscription Offering of 3,000,000 “F.C.Porto –
Futebol, SAD 2006-2009” bonds amounting to 15,000,000 Euros. The bonds bear interest payable
in arrears on 15 June and 15 December of each year, the first payment having been made on 15
June 2007. Interest is at the fixed rate of 6% per annum, calculated based on a 30 day per month
basis and 360 days per year. The bonds have a three year maturity, their nominal amount being
repayable, in a single payment, on 15 December 2009. The Company has already prepared a financial operation to restructure this liability, so as to resettle a significant part of the debt in the long
term.
ii) The caption “Bank loans” as of 30 June 2009 includes the amount of 4,386,189 Euro (8,607,914 Euro
as of 30 June 2008), related to a loan contract signed on 20 February 2003 totalling 23,201,305 Euros
that was renegotiated in the first half of the year ended 30 June 2007. This loan bears annual interests at the Euribor 12M rate plus a spread and is repayable in successive equal annual instalments
up to August 2012; however, the contract allows advanced amortizations, according to the season
tickets’ revenue. Since the revenue from the sale of tickets in 2009/10 allowed the full amortization of the loan after 30 June 2009, it is classified as a current liability.
iii) The caption “Bank loans” as of 30 June 2009 includes the amount of 3,300,000 Euro (4,950,000 Euro
as of 30 June 2008), of which 1,650,000 Euro with a medium and long term maturity, relates to a
loan contract signed in February 2006 in the amount of 7,950,000 Euro. This loan bears interests
at a fixed market rate and is repayable in successive equal half yearly instalments up to January
2011. This loan is guaranteed by the amounts to be received from Portugal Telecom under the
multi-annual publicity (Estádio do Dragão central stands Naming Rights) contract signed with
that entity.
iv) As of 30 June 2009, the caption “Bank Loans” includes the amount of 6,666,666 Euro (13,333,332
as of 30 June 2008), with maturity in the medium and long term relating to a facility agreement
celebrated in 22 October 2007. This loan bears semi-annual interests at the Euribor 6M rate plus
a spread and is repayable in equal annual instalments until July 2010. This loan, currently, has as
guarantee the third debt security of Real Madrid concerning the registration of the player Pepe.
v) As of 30 June 2009, the caption “Bank Loans” includes the amount of 13,400,000 Euro, of which
8,934,000 Euro with maturity in the medium and long term, related with the credit facility agreement signed in 15 September 2008. This loan bears monthly interests at the Euribor 1M rate plus a
spread and is repayable in equal annual instalments until August 2011. This loan, currently, has as
guarantee the account receivable from F.C.Internazionale Milano relating to the sale of the registration of Ricardo Quaresma, net of the acquisition of the registration of Pelé to this same club.
86
vi) As of 30 June 2009, the caption “Bank Loans” includes the amount of 8,000,000 Euro, related with
the credit facility agreement signed in 20 November 2008. This loan bears monthly interests at
the Euribor 1M rate plus a spread and is repayable in one instalment in July 2009. This loan, as
of 30 June 2009, had as guarantee Bruno Alves’ registration. This loan has already been paid as
of 6 October 2009.
vii) As of 30 June 2009, the caption “Bank Loans” includes the amount of 6,878,456 Euro, of wich
1,750,000 Euro with maturity in the medium and long term, related with the credit facility agreement signed in 31 October 2008. This loan bears half yearly interests at the Euribor 6M rate
plus a spread and is repayable in four half yearly instalments until June 2011. This loan, as of 30
June 2009, had as guarantee Lisandro Lopez’s registration. This loan has already been paid as of
6 October 2009.
viii) As of 30 June 2008, the caption “Bank Loans” includes the amount of 4,000,000 Euro, of which
2,000,000 Euro with maturity in the medium and long term, related with the credit facility agreement signed in 5 March 2009. This loan bears quarterly interests at the Euribor 3M rate plus a
spread and is repayable in four quarterly instalments from July 2009. This loan has as guarantee
the sponsorship contract of senior football team signed with Portugal Telecom for the seasons
2009/2010 and 2010/2011.
ix) As of 30 June 2009, the caption “Bank Loans” includes the amount of 2,000,000 Euro related with
the credit facility agreement signed in 3 April 2009. This loan bears half yearly interests at the
Euribor 5M rate plus a spread and is repayable in one instalment in August 2011. This loan, as
of 30 June 2009, had as guarantee the fulfilment of one of the objectives of the contract for the
sale of Ricardo Quaresma’s registration to FCInternazionale Milano. This loan has already been
paid as of 6 October 2009.
x) As of 30 June 2009, the caption “Bank Loans” includes the amount of 7,300,000 Euro related with the
credit facility agreement signed in 9 June 2009. This loan bears quarterly interests at the Euribor 3M
rate plus a spread and is due in October 2009. This loan has as guarantee the revenues from UEFA
Champions League 2009/2010 - Note 13.
xi) The amount recorded under the caption “Credit on current accounts” as of 30 June 2009 has as
guarantee the accounts receivable arising from the final bend of the registration of some players,
with the maximum credit line amounting to 5,000,000 Euro.
The average annual rate of bank loans as of 30 June 2009 is 4.86%.
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19. TRADE PAYABLES
Non-current liabilities
This caption as of 30 June 2009 and 2008 was made up as follows:
30.06.2009
30.06.2008
8.496.889
4.112.778
352.266
479.731
(570.807)
(260.531)
8.278.348
4.331.978
Fixed assets’ suppliers:
Transactions related to players’ registrations
Other
Effect of discounting trade payables
As of 30 June 2009, the balance of non-current “Trade payables” is mainly due to the acquisition of
players’ registrations mentioned in Note 8 – Tomás Costa, Cristian Rodriguez, Orlando Sá and Álvaro Pereira amounting to, approximately 6,400,000 - as well as intermediation service costs and other
costs associated with sale of the registrations of Pepe and Quaresma, amounting to approximately
2,100,000 Euro.
As of 30 June 2009 the repayment schedule of the nominal value of non-current liabilities may be
summarized as follows:
2010/2011
2011/2012
30.06.2009
7.221.889
1.275.000
8.496.889
88
Current liabilities
Payable to
Trade payables - current account
Trade payables - bills payable
Leasing
Other
30.06.2009
- 90 days
90 - 180 days
+ 180 days
7.496.498
50.000
5.157.944
50.000
1.483.894
-
854.660
-
17.322.535
206.487
289.371
9.092.414
40.236
69.195
250.000
40.236
17.802
7.980.121
126.015
202.374
17.818.393
9.201.845
308.038
8.308.510
(187.207)
(68.246)
(45.127)
(73.834)
25.177.684
14.341.543
1.746.805
9.089.336
Payable to
Trade payables - current account
Trade payables - bills payable
Leasings
Other
30.06.2008
- 90 days
90 - 180 days
+ 180 days
4.082.588
-
4.082.588
-
-
-
19.088.701
184.290
193.426
12.729.461
44.377
174.466
4.389.992
46.072
8.623
1.969.248
93.841
10.337
19.466.417
12.948.304
4.444.687
2.073.426
(250)
-
-
(250)
23.548.755
17.030.892
4.444.687
2.073.176
As of 30 June 2009 the main balances included in caption, current and non-current, “Fixed assets’
suppliers - Transactions related to players’ registrations” consider accounts payable to the entities
Gestifute - Gestão de Carreiras de Profissionais Desportivos, S.A., Marítimo da Madeira - Futebol,
SAD, Club Atlético Rosário Central, Club Atlético Rentistas, Play International B.V., US Citta de Palermo SPA, Rio Football Services Hungary, Sporting Clube de Braga Futebol SAD e S.C. CFR 1907 Cluj
SA, which represent 77% of the total balance.
As of 30 June 2008 the main balances included in caption “Fixed assets’ suppliers - Transactions related to players’ registrations” consider accounts payable to the entities Club Atlético Rosário Central,
Gestifute - Gestão de Carreiras de Profissionais Desportivos, S.A., International Football - Gestão e
Assessoria de Carreiras, Rio Football Services Hungary, KFT, Marítimo da Madeira - Futebol, SAD,
IMFC Licensing, L&M Global Rights, União Desportiva de Leiria e Onsoccer which represent 84%
of the total balance.
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20. OTHER CURRENT AND NON CURRENT LIABILITIES
The captions “Other non current liabilities” and “Other current liabilities” as of 30 June 2009 and
2008 can be detailed as follows:
30.06.2009
30.06.2008
1.192.302
444.445
479.532
778.207
Other non-current liabilities
Accruent expenses:
Cost of players’ transactions not yet invoiced
Deferred income:
Advertising
Deferred broadcasting rights
5.200.000
-
6.871.234
1.222.652
State and public sector
2.447.699
2.378.308
Other creditors
5.016.165
4.831.810
7.463.864
7.210.118
Accrued payroll
738.365
569.914
Accrued interest
915.369
965.790
Cost of players’ transactions not yet invoiced
4.571.268
7.117.467
Competition prizes subject to processing
4.131.314
4.830.146
Other current liabilities
Accrued expenses:
Rescision costs subject to processing
657.347
-
Other accrued expenses
241.244
68.133
11.254.907
13.551.450
Deferred broadcasting rights
3.050.000
2.660.000
Sale of season seats
2.328.017
520.867
Advertising
3.042.810
4.627.741
348.539
158.604
8.769.366
7.967.212
27.488.137
28.728.780
Deferred income:
Other deferred income
The caption “Cost of players’ transactions not yet invoiced” includes commitments assumed by the Group
in transactions relating to the registrations of players not yet invoiced as of the balance sheet date. The balance of this caption as of 30 June 2009 includes, namely, amounts related with: (i) the acquisition of the
registration and/or the renewal of the labour contract of the players Cristian Rodriguez, Lisandro Lopez,
Pelé and Raúl Meireles; (ii) intermediation services costs related with the sale of Lucho Gonzalez, Paulo Machado and Pepe’s registrations; (iii) the cost of Paulo Machado’s purchase option cancellation with AS SaintEtienne; (iv) “solidarity mechanism” and other costs not yet settled, related with the sale and acquisition of
players’ registrations. In the balance classification as non-current, which regards the signing-on fees, the
agreed payment dates were considered.
90
The balance as of 30 June 2008 includes, namely, amounts related with the acquisition of 50% of the
registration of Lisandro Lopez, which represents 72% of that balance, as well as “solidarity mechanism” related with the sale and acquisition of players’ registrations and other costs not yet settled,
related with the signing or renewal of the labour contracts of other players.
The caption “Other creditors”, as of 30 June 2009, considers the amount of, approximately, 1,400,000
Euro related with the wages of June 2009 that were settled in the beginning of July, as well as bonus
to be paid to the players, in the amount of, approximately, 2,050,000 Euro which due date is on the
short term.
As of 30 June 2009 the caption “Competition prizes subject to processing” includes the amounts
related with the bonuses granted to the players and technical team for the victory on the Football
Championship 2008/2009 (Note 25).
21. PROVISIONS AND ACCUMULATED IMPAIRMENT LOSSES
The changes in provisions and accumulated impairment losses in the years ended 30 June 2009 and
2008 were as follows:
Opening balance 30.06.2008
Increase
Utilization
1.820.226
1.605.927
2.113.816
62.309
318.722
-
(94.197)
-
3.839.845
62.309
1.924.649
3.426.153
2.494.847
-
(94.197)
5.826.803
Opening balance 30.06.2007
Increase
Utilization
1.000.000
1.229.805
2.580.712
655.356
343.260
(1.000.000)
(51.686)
-
(13.249)
(1.318.045)
1.820.226
1.605.927
4.810.517
998.616
(1.051.686)
(1.331.294)
3.426.153
Accumulated impairment loss on investments (Note 9)
Accumulated impairment loss on accounts receivable (Note 11)
Accumulated impairment loss on inventories (Note 12)
Provisions
Accumulated impairment loss on investments (Note 9)
Accumulated impairment loss on accounts receivable (Note 11)
Accumulated impairment loss on inventories (Note 12)
Provisions
Decrease Closing balance 30.06.2009
Decrease Closing balance 30.06.2008
Provisions
Tax litigation
In April and June of 2007, following a tax inspection of the year ended 30 June 2005, FCPorto, SAD was
notified of additional Corporate Income Tax (CIT) and Value Added Tax (VAT) assessments amounting to
approximately 1,203,000 Euro and 490,000 Euro, respectively, including compensatory interests.
Following an inspection of the fiscal year ended 30 June 2004, the Company received in November
2007 an additional settlement with regard to VAT in the amount of 801,021 Euro, and in January
2008 an additional settlement with regard to CIT in the amount of 2,338,331 Euro, which includes
91
B4
compensatory interests, whose draft of Inspection’s Tax Report had already been received and reviewed in the closing and approval of accounts process for the year ended 30 June 2007.
Finally, early in 2009, following a tax inspection of the years ended 30 June 2006 and 30 June 2007,
FCPorto, SAD was notified of additional Corporate Income Tax amounting to 595,450 Euro, including compensatory interests.
The Board of Directors and its legal and tax advisers, consider that the reasons given by the Tax
Administration on the matters above mentioned are not in accordance with Portuguese law, so
they submitted complaints to the additional settlements received, with the exception of part of the
amount (220,261 Euros) considered in the additional assessments received in 2009, which was paid
in early 2009.
As of 30 June 2009, FCPorto, SAD has bank guarantees requested in favour of the Tax Administration
in the amount of 4,315,195 Euro, related with the additional settlements for the years ended 30 June
2004 and 2006.
In a cautious view and in relation with the situations mentioned above, in the year ended 30 June
2007, a provision was recorded in the total amount of 2,580,712 Euro.
During the year ended 30 June 2008, the additional settlements of Corporate Tax and VAT received
in April and June 2007 were decided in a favourable manner to FCPorto, SAD, and the Company paid
only the amount of approximately 87,000 Euro. Therefore, during the year ended 30 June 2008, part
of the corresponding provision amounting to 1,318,045 Euro was reverted.
During the year ended 30 June 2009 the provision was increased in 158,167 Euro against the income
statement caption “Income Tax” (Note 15), taking into account the additional assessments received
for the years ended 30 June 2006 and 2007.
In this way, as of 30 June 2009, the tax processes related with the years ended 30 June 2004, 2006 and
2007 are still to settle, and the global amount of assessments claimed by the Company amounts to,
approximately, 3,514,000 Euro, for which there is a total provision of 1,514,094 Euro, that the Board
considers sufficient to address the risk of an unfavourable outcome of those assessments.
Other Litigations
During the year ended 30 June 2008 a provision was also recognised for a judicial process underway
brought by a third party against the subsidiary PortoEstádio, for an amount of 250,000 Euro, following the advice of its’ legal advisers. In May of 2009, the Judicial Court’s (7ª Vara Cível do Tribunal
Judicial do Porto) decision was to condemn PortoEstádio to pay a compensation of 404,241 Euros,
plus moratory interests calculated from the date of notification of the sentence until the payment of
compensation. Despite PortoEstádio presented an appeal against the verdict, the related provision
was increased in the amount of 160,555 Euro.
92
Impairment losses
During the financial year ended 30 June 2009 impairment losses related with accounts receivable
were recorded in the amount of 2,113,816 Euro, of which 1,573,843 Euro are from other football
clubs or sports companies that show difficulties in the settlement of their commitments.
22. SERVICES RENDERED
Services rendered for the years ended 30 June 2009 and 2008 are up made up as follows:
30.06.2009
30.06.2008
Sporting income
31,460,733
25,082,266
Advertising
13,605,489
13,025,265
Broadcasting rights
8,302,000
7,050,000
Others
8,970,544
8,254,231
62,338,766
53,411,763
The balance of the caption “Sporting income” includes essentially: (i) the amount of 16,192,000
Euro (11,610,990 Euro for the year ended 30 June 2008) relating to premiums for participating in
the UEFA Champions League; and (ii) the amount of 13,352,403 Euro (12,516,540 Euro for the year
ended 30 June 2008) relating with ticket sales for matches played at “Estádio do Dragão” and season
tickets, which includes 3,814,741 Euro (3,642,053 Euro for the year ended 30 June 2008) relating to
the Group’s proportion on income from quotas of the associates of Futebol Clube do Porto.
The caption “Others” includes primarily (i) the amount of 2,017,289 Euro (1,951,825 Euro for the
year ended 30 June 2008) regarding income relating to “Lugares Euroantas” (Note 31), (ii) the amount
of 2,664,722 Euro (3,312,334 Euro for the year ended 30 June 2008) related with services provided
by PortoEstádio and PortoComercial, regarding events’ organization, room renting, parking lots,
among others, and (iii) the amount of 1,424,642 Euro (1,422,718 Euro for the year ended 30 June
2008) related with corporate commissions fees charged by Porto Comercial to Euroantas under the
commercial arrangement between the two entities.
As of 4 December 2008, PortoComercial revoked the merchandising arrangement with TBZ celebrated on 31 March 2006 and amended on 30 June 2008, related with the commercial exploitation
of trademarks and commercial areas of Futebol Clube do Porto, and became responsible for the direct commercialization of trademarks and/or the image of Futebol Clube do Porto (“licensing”). The
amount related with the licensing business, registered under the caption “Others”, amounted to
895,049 Euros for the year ended 30 June 2009 (1,058,984 Euros for the year ended 30 June 2008).
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23. OTHER OPERATIONAL INCOME
On 3 December 2008, the Court of Arbitration for Sport issued a decision which condemned Jacobus
Adriaanse and the assistant coach Jan Olde Riekerink to pay FC Porto, SAD the amount of 1,070,059
Euro. This process resulted from a formal complaint filed by the Company to FIFA, in August 2006,
against the coaching staff (led by Jacobus Adriaanse) as a result of the breach of the employment
contract, allegedly without cause.
Thus, the caption “Other operating income” considers the amount of 1,070,059 Euros, related with
the compensation stipulated as of that date, above mentioned (which was received in February 2009)
as well as the annulment of the accrued expense recorded in previous years for prizes to be awarded
to this coaching staff, amounting to 1,399,083 Euro.
24. EXTERNAL SUPPLIES AND SERVICES
30.06.2009
30.06.2008
Subcontrats
2.447.066
1.795.257
Rents
1.404.835
706.080
Sports equipment
430.653
312.060
Representation expenses
417.625
357.937
Communications
637.640
466.900
Insurance
880.871
730.255
Travel and accommodation
2.157.975
2.091.501
Fees
1.095.569
1.082.086
Repair and maintenance
570.538
590.914
Advertising
982.296
1.060.742
Surveillance and security
1.339.934
1.106.772
Specialised services
3.012.120
2.919.030
Organization costs
3.505.469
2.429.133
Office expenses
Others
124.100
114.637
1.164.607
1.108.672
20.171.298
16.871.976
In the caption “Subcontracts” are included costs incurred in connection with the protocol signed
between the Group and Futebol Clube do Porto, mainly related with the use of several facilities, as
well as the utilization of the training center by the senior team, and also by the junior teams.
The “Travel and accommodation” caption includes, essentially, the travels and related accommodation made by the football team during the national championship, the UEFA Champions League
and training periods.
The caption “Organization costs” considers various costs related with the realization of games and
other events at Estádio do Dragão.
94
The caption “Specialised services” includes several types of costs associated with the Group’s activity, namely (i) expenses with market research’ services, (ii) costs with legal advisory services, (iii) cost
with audit services; and (iv) expenses with financial advisory services.
25. PAYROLL EXPENSES
The caption “Payroll expenses” for the years ended 30 June 2009 and 2008 is made up as follows:
30.06.2009
30.06.2008
Corporate boards
2.544.300
2.276.632
Football players
28.531.942
24.452.445
Technical and administrative staff
10.435.642
7.794.662
Insurance
1.805.309
1.433.875
Other costs
4.225.328
2.746.116
47.542.521
38.703.730
Net payroll expenses for the year ended 30 June 2009, of players on loan to other clubs, amounted to approximately 3,200,000 Euro (3,500,000 Euro on 30 June 2008).
Payroll expenses for the year ended 30 June 2009 and 2008 include bonuses granted to players and technical staff for the wins in the Portuguese 2008/2009 and 2007/2008 football championships.
The increase in the caption “Other costs” is due, essentially, to an increase in indemnities related with the
termination of players’ labour contracts.
As of 30 June 2009 and 2008, the number of people working for the Group was as follows
30.06.2009
30.06.2008
Corporate boards (*)
12
12
Administrative staff
94
91
Technical staff
19
9
Auxiliar technical staff
25
9
Vendors (stores)
24
-
Football players
54
47
228
168
(*) Includes four non-executive directors
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26. RESULTS OF TRANSACTIONS RELATING TO PLAYERS’ REGISTRATIONS
The results of transactions relating to players’ registrations in the years ended 30 June 2009 and 2008
are as follows:
30.06.2009
30.06.2008
22.080.849
18.927.320
Amortization and impairment losses of players’ registrations
Amortization of players’ sporting registration rights (Note 8)
Impairment losses of players’ sporting registration rights (Note 8)
1.689.122
1.156.282
23.769.971
20.083.602
Income/(expenses) related to players’ registrations
Losses from the sales of players’ registrations
Costs relating to players on loan
Others expenses relating to players
Gains from the sales of players’ registrations (Note 8)
-
(53.125)
(330.000)
(1.970.000)
(1.207.592)
(1.297.419)
(1.537.592)
(3.320.544)
34.589.685
37.353.362
Income relating to players on loan
1.888.200
1.024.500
Other income relating to players
5.067.333
262.941
41.545.218
38.640.803
40.007.626
35.320.259
16.237.655
15.236.657
Impairment losses of players’ registrations rights consider the carrying amount of players’ registrations as of 30 June 2009 whose labour contracts were terminated by the Group until the approval
date of these financial statements. The balance of this caption as of 30 June 2009 corresponds essentially to the players Kazmierczak, Claudio Pitbull, Adriano e Ivanildo, while as of 30 June 2008 this
balance corresponded essentially to the players Alan, Paulo Assunção, Ezequias and Sonkaya.
The amounts included in caption “Gains from the sale of players’ registrations” are net of the carrying amount of the players’ registration, intermediation costs incurred with that sales, and liabilities under the “solidarity mechanism” (if and when applicable) and also net from the discount effect
of accounts receivable and payable related with these transactions (Note 8).
As of 30 June 2009, the caption “Other income relating to players” considers the amount of 3,500,000
Euro, related with the compensation agreed with Atlético de Madrid and Paulo Assunção, for his
early termination of the employment contract with the Company, in end of the 2007/08 season, to
represent that football club.
96
27. FINANCIAL EXPENSES AND INCOME
Financial expenses and income of the years ended 30 June 2009 and 2008 are made up as follows:
30.06.2009
30.06.2008
Financial expenses:
Interest
5.500.908
4.469.952
Exchange loss
-
2.031
Financial discount allowed
-
-
1.118.563
187.199
528.166
311.502
7.147.637
4.970.684
(5.512.231)
(3.845.596)
1.635.406
1.125.088
Discount effect of accounts receivable
Other financial expenses
Net financial expenses
Financial income:
Interest
-
1.552
Exchange gain
-
60.458
1.635.406
935.996
-
127.082
1.635.406
1.125.088
Discount effect of accounts payable
Other financial income
The captions balances “Discount effect of accounts receivable” and “Discount effect of accounts
payable” relate to interest for the period between the date of sale of several players’ registrations and
the agreed payment/receipt dates.
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28. RELATED PARTIES
The balances and transactions between the Company and its subsidiaries, which are related parties,
were eliminated in consolidation and therefore are not mentioned in this note. The main balances
with related entities, identified below, as of 30 June 2009 and 2008 and the main transactions performed with these entities during the year ended as of that date, are as follows:
30.06.2009
Transactions
Futebol Clube do Porto
Euroantas (Note 31)
Olivedesportos
Sportinveste
Sales and services
External supplies
Dividends
rendered
and services
distribution
4,361,867
4,725,025
9,102,000
443,351
2,490,003
766,383
59,790
78,000
-
18,632,243
3,316,176
78,000
30,06,2008
Euroantas (Note 31)
Olivedesportos
Sportinveste
Sales and services
External supplies
rendered
and services
3,963,181
3,377,837
7,675,000
432,203
1,826,124
1,514,025
59,773
15,421,221
3,399,922
30,06,2009
Balances
Euroantas (Note 31)
Olivedesportos
Sportinveste
Accounts
Accounts
Other current
Other current
receivable
payable
assets
liabilities
9,299,938
4,013,755
9,426,589
43,018
961,294
876,631
11,132
8,256,910
125,349
-
8,250,000
962,389
22,783,300
1,849,057
8,382,259
9,212,389
30,06,2008
Euroantas (Note 31)
Olivedesportos
Sportinveste
Accounts
Accounts
Other current
Other current
receivable
payable
assets
liabilities
7,235,802
114,341
7,318,017
23,248
330,028
317,377
1,960,200
23,934
3,679,971
-
2,660,000
1,360,620
14,691,408
2,631,539
3,679,971
4,020,620
98
Futebol Clube do Porto is the main shareholder of FC Porto, SAD (Note 16), and Euroantas is 99.99%
owned by this entity. Additionally, information is displayed above of balances and transactions of
the Group with the entities Sportinveste - Multimédia, S.A. (“Sportinveste”) e Olivedesportos - Publicidade Televisão e Media, S.A. (“Olivedesportos”), as the Chairman of the Board of Directors of these
entities is a referral shareholder of FC Porto, SAD.
The remuneration of the members of the Board of Directors of FC Porto, SAD and its subsidiaries, for
the years ended 30 June 2009 and 2008 is as follows:
Fixed remuneration (1)
Variable remuneration
(1)
30.06.2009
30.06.2008
1.634.300
910.000
1.578.954
697.678
2.544.300
2.276.632
The fixed component of remuneration considers social security costs.
29. EARNINGS PER SHARE
Earnings per share were calculated considering the following amounts:
30.06.2009
30.06.2008
Net profit/(loss) considered for the computation of basic earnings per share
Effect of potential shares
5.135.220
-
7.964.449
-
Net profit/(loss) considered for computation of diluted earnings per share
5.135.220
7.964.449
Weight number of shares used to compute the basic earnings per share
Effect of potential shares
15.000.000
-
15.000.000
-
Weight number of shares used to compute the diluted earnings per share
15.000.000
15.000.000
0,34
0,53
Earnings
Number of shares
Earnings per share (basic and diluted)
30. SEGMENT REPORTING
The Group is organized in two major operating segments:
Segment A: operations relating to participation in professional football competitions, and the promotion and organization of sporting events.
Segment B: activities relating to the sale of image rights, sponsorship, merchandising and product licensing.
Other services: includes activities of the subsidiaries PortoMultimedia, S.A., PortoEstádio, S.A. and PortoSeguro, Lda.
99
B4
Contribution of the main segments to consolidated profit/(loss) for the years ended 30 June 2009 and
2008 was as follows:
Income
External income
Inter-segment income
Total income
Profit/(loss)
Segment/operational profit/(loss)
Financial expenses
Financial income
Net profit in associated companies
Net profit relating to investments
Income tax
Profit/(loss) of ordinary activities
Minority interests
Net profit
30.06.2009
Elimination
Consolidation
4.181.672
-
68.143.494
5.048.593
9.230.265
(8.830.429)
(8.830.429)
68.143.494
(64.963)
-
11.169.631
33.186
(210.568)
435.851
1.769
13.570
(22.196)
(75.358)
(1.122.000)
(1.122.000)
7.149.406
1.682.162
(555.094)
5.147.293
-
-
(12.073)
-
12.073
5.135.220
6.967.339
50.100
6.898.695
5.849
(371.525.518)
(1.706.410)
5.944.851
5.348.624
(5.485.091)
114.132
117.571
141.997
295.913
182.671.332
901.226
183.572.558
160.797.046
160.797.046
43.055.596
23.045.684
Segm. A
Segm. B
Other services
42.880.043
5.888.052
2.482.754
45.362.797
374.756
6.262.808
10.464.892
2.133.075
4.952.596
1.124.534
(163.227)
6.473.603
-
Segm. A
Segm. B
53.519.883
10.441.939
2.976.182
54.496.065
805.654
11.247.593
10.621.361
613.233
7.147.637
1.635.406
1.122.000
(322.330)
5.908.800
-
Other information
Segment net assets
174.988.152
Investments
2.551.687
Total consolidated net assets
Segmental liabilities
154.988.662
Total consolidated liabilities
Investment in fixed assets and team
42.799.467
Amortization and depreciation for the year, including players’ registration 22.632.200
Income
External income
Inter-segment income
Total income
Profit/(loss)
Segment/operational profit/(loss)
Financial expenses
Financial income
Net profit in associated companies
Net profit relating to investments
Income tax
Profit/(loss) of ordinary activities
Minority interests
Net profit
Other information
Segment net assets
150.579.136
Investments
2.792.230
Total consolidated net assets
Segmental liabilities
137.917.742
Total consolidated liabilities
Investment in fixed assets and team
40.320.744
Amortization and depreciation for the year, including players’ registration 19.382.375
Other services
30.06.2008
Elimination
Consolidation
6.204.678
-
54.972.773
3.554.481
9.759.159
(6.411.991)
(6.411.991)
54.972.773
108.988
-
12.706.955
18.088
554
(576.311)
1.539.230
42.364
14.983
(45.916)
35.691
-
5.013.048
1.140.071
(785.454)
8.048.524
-
-
(84.075)
-
84.075
7.964.449
3.645.854
50.100
6.557.863
5.849
(2.877.268)
(1.946.953)
1.862.100
4.199.980
(2.877.299)
3.201
111.424
38.406
354.661
157.905.585
901.226
158.806.811
141.102.523
141.102.523
40.362.351
19.848.460
100
31. “ESTÁDIO DO DRAGÃO”
On 7 July 2003 a Cooperation Agreement was signed between PortoEstádio, Euroantas, Futebol Clube do Porto and Futebol Clube do Porto – Futebol, S.A.D. relating to the construction, financing,
operation and utilization of “Estádio do Dragão” (“the Stadium”).
Under that agreement, Euroantas, the present owner of the Stadium, transferred to FCP, SAD the
right to operate the Sporting Area of the Stadium for a period of 30 years, in return for an annual,
approximately linear, amount charged to FCP, SAD over the period, the total payment being divided
into two components:
i) An amount equal to the debt service borne by Euroantas during the first 15 years on the Loan
Contract entered into for the construction of the Stadium and, in the last 15 years, a lower amount
indexed to the debt service for the last year (2018) on the Loan Contract; and
ii) The amount of 14,963,937 Euros, settled in the year ended 30 June 2003 and recorded as “Other
non-current assets (Note 13), as a remuneration for the amount of the falling due rents during the
15 year period, determined from 2018. This amount will be recognized as a linear cost over the
period of 15 years from 2018.
In accordance with the agreement, FCP, SAD also retains the right to receive from Euroantas, any excess, determined annually, of the income, net of the inherent operating expenses, commercialization
of Boxes and Business Seats of ”Estádio do Dragão” (“Lugares Euroantas”) over the amount of the “rent”
mentioned above. The excess for the year ended 30 June 2009 amounted to 2,017,289 Euro (Note 22).
32. CONTINGENT ASSETS AND LIABILITIES
As of 30 June 2009 there is an ordinary lawsuit brought against the Company by a shareholder requiring
annulment of the decisions of the Shareholders’ General Meeting held on 28 October 2005 that approved:
1. The Board of Directors’ Report and Non-Consolidated Financial Statements of the year ended 30
June 2005;
2. The Board of Directors’ Report and Consolidated Financial Statements of the year ended 30 June 2005;
3. The proposed appropriation of net consolidated result for the year ended 30 June 2005.
The Company’s Board of Directors and its legal advisers believe that the reasons presented by the
shareholder in the ordinary lawsuit are not in accordance with Portuguese legislation and therefore
it has been legally contested. The outcome of this matter is not expected to have any impact on the
accompanying financial statements.
101
B4
33. POST BALANCE SHEET EVENTS
The following events took place after the date of the financial statement that, by its relevance, are
presented as follows:
i) Acquisition of 50% of the registration of Bellushi (5,000,000 Euro) and 60% of the registration of
the player Falcão (3,930,000 Euro);
ii) Sale of the registrations of Lisandro Lopez and Cissokho to Olympique de Lyonnais (by the
amounts of 24,000,000 Euro and 15,000,000 Euro, respectively) - as a result of the sale of player Lisandro Lopez the bank loan that was guaranteed by his registration was paid (Note 18);
iii) Renewal and extension of the labour contract with the player Hulk for over two sporting seasons, until 30 June 2014;
iv) Celebration of a loan contract with Millennium BCP in the amount of 8,000,000 Euros, related
with the account receivable from the sale of Lucho Gonzalez’s registration to Marseille and two
loans with Banco Espírito Santo as current accounts related with the account receivable from Olympique Lyonnais for the sale of Lisandro Lopez and Cissokho’s registrations, with a credit limit of
14,000,000 and 10,000,000 Euros, respectively.
34. APPROVAL OF THE FINANCIAL STATEMENTS
The accompanying financial statements were approved by the Board of Directors on 6 October 2009.
35. EXPLANATION ADDED FOR TRANSLATION
These consolidated financial statements are a translation of financial statements originally issued
in Portuguese in accordance with International Financial Reporting Standards (IFRS/IAS), some
of which may not conform to or be required by generally accepted accounting principles in other
countries. In the event of discrepancies, the Portuguese language version prevails.
102
103
B
5
CONSOLIDATED STATEMENTS
OF CASH FLOWS FOR THE YEARS
ENDED 30 JUNE 2009 AND 2008
104
5. Consolidated Statements of cash flows for the years ended 30 June 2009 and 2008
(Translation of statements originally issued in Portuguese - Note 35) (Amounts expressed in Euro)
30.06.2009
Operating activities:
Cash receipts from trade debtors
Cash payments to trade creditors
Cash payments to employees
Other cash receipts/(payments) relating to operating activities
Income taxes (paid)/received
67,254,565
(18,872,087)
(44,246,792)
896,289
(1,332,789)
Net cash flow from operating activities (1)
Investment activities:
Cash receipts arising from :
Investments
Tangible assets
Loans granted
Interest and similar income
Dividends
Cash payments arising from:
Investments
Tangible assets
Loans granted
30.06.2008
48,354,110
(18,825,930)
(37,665,348)
1,797,083
3,699,186
(21,608)
3,699,186
149,640
41,098,266
46,756
-
41,294,662
(762,173)
(43,659,158)
-
Net cash from/(used in) investment activities (2)
(6,361,693)
(6,361,693)
142,982
20,397,765
16,535
-
20,557,282
(549,468)
(36,348,840)
(44,421,331)
-
(3,126,669)
(36,898,308)
(16,341,026)
Financing activities:
Cash receipts arising from:
Loans obtained
136,573,734
136,573,734
142,685,823
142,685,823
Cash payments arising from:
Loans obtained
Interest and similar charges
Dividends
(127,462,385)
(118,456,603)
(6,209,879)
(4,877,502)
(133,672,264)
(123,334,105)
2,901,470
19,351,718
Cash and cash equivalents at the beginning of the financial year
Variation of consolidation perimeter
3,476,331
-
6,827,332
-
Net increase/(decrease) of cash and cash equivalents: (1)+(2)+(3)
3,473,987
(3,351,001)
Cash and cash equivalents at the end of the financial year (Note 14)
6,950,318
3,476,331
Net cash from/(used in) financing activities (3)
The accompanying notes form an integral part of the consolidated statement of cash flows for the year ended 30 June 2008 and 2007
105
B
6
STATUTORY AUDIT AND
AUDITORS’ REPORT
CONSOLIDATED
FINANCIAL STATEMENTS
106
Introduction
1. In compliance with the applicable legislation, we hereby present our Statutory Audit and Auditors’
Report on the consolidated financial information contained in the Board of Directors’ Report and the
accompanying consolidated financial statements of Futebol Clube do Porto – Futebol, S.A.D. (“Company”) and subsidiaries for the year ended 30 June 2009, which comprise the consolidated Balance
sheet as of 30 June 2009, that reflects a total of 183,572,558 Euro and shareholders’ equity of 22,775,512
Euro, including net result of 5,135,220 Euro, the consolidated statements of profit and loss by nature,
cash flows and changes in equity for the year then ended and the corresponding notes.
Responsibilities
2. The Company’s Board of Directors is responsible for: (i) the preparation of consolidated financial
statements that present a true and fair view of the financial position of the companies included in
the consolidation, of the consolidated results of their operations, changes in equity and their consolidated cash flows; (ii) the preparation of historical financial information in accordance with International Financial Reporting Standards as adopted by the European Union and that is complete,
true, timely, clear, objective and licit, as required by the Portuguese Securities Market Code; (iii) the
adoption of adequate accounting policies and criteria and the maintenance of appropriate systems
of internal control; and (iv) the disclosure of any significant facts that have influenced the operations
of the companies included in the consolidation, their financial position or results of operations.
3. Our responsibility is to examine the financial information contained in the documents referred
to above, including verifying that, in all material respects, the information is complete, true, timely,
clear, objective and licit, as required by the Portuguese Securities Market Code, and to issue a professional and an independent report based on our work.
Scope
4. Our examination was performed in accordance with the Auditing Standards (“Normas Técnicas e as
Directrizes de Revisão/Auditoria”) issued by the Portuguese Institute of Statutory Auditors (“Ordem dos
Revisores Oficiais de Contas”) which require that the examination be planned and performed with the
objective of obtaining reasonable assurance about whether the consolidated financial statements are free
of material misstatement. Such an examination includes verifying, on a sample basis, evidence supporting the amounts and disclosures in the consolidated financial statements and assessing the significant
estimates, based on judgements and criteria defined by the Company’s Board of Directors, used in their
preparation. Such an examination also includes: verifying the consolidation procedures and that the financial statements of the companies included in the consolidation have been appropriately examined,
assessing the adequacy of the accounting policies used and their uniform application and disclosure,
taking into consideration the circumstances, verifying the applicability of the going concern concept,
verifying the adequacy of the overall presentation of the consolidated financial statements, and asses107
B6
Statutory Audit and Auditors’ Report Consolidated Fianancial Statements
sing if, in all material respects, the consolidated financial information is complete, true, timely, clear, objective and licit. Our examination also includes verifying that the consolidated financial information included in the consolidated Board of Directors’ Report is consistent with the consolidated
financial statements. We believe that our examination provides a reasonable basis for expressing
our opinion.
Opinion
5. In our opinion, the consolidated financial statements referred to in paragraph 1 above, present
fairly, in all material respects, the consolidated financial position of Futebol Clube do Porto - Futebol, S.A.D. and subsidiaries as of 30 June 2009, the consolidated results of its operations and its consolidated cash flows for the year then ended, in conformity with the International Financial Reporting Standards as adopted by the European Union and the financial information contained therein
is, in terms of the definitions included in the auditing standards referred to in paragraph 4 above,
complete, true, timely, clear, objective and licit.
Emphasis
6. The financial statements referred to in paragraph 1 above, still disclose that half the Company’s
capital had been lost, and consequently the provisions of article 35 of the Commercial Company
Code (“Código das Sociedades Comerciais”) apply, as well as present a negative working capital. As
referred in the Board of Directors’ Report and Note 16 to the consolidated financial statements, the
Board of Directors considers that, as of 30 September 2009, those legal provisions will already be
fulfilled, taking into consideration the transactions carried out after 30 June 2009 (Note 33). In this
context, the accompanying financial statements were prepared on a going concern basis, which considers the continued financial support of the financial entities and the success of the Company’s
future operations.
Porto, 8 October 2009
______________________________________________
Deloitte & Associados, SROC S.A.
Represented by Jorge Manuel Araújo de Beja Neves
108
109
B
7
REPORT AND FISCAL COUNCIL
STANDPOINT - CONSOLIDATED
FINANCIAL STATEMENTS
110
Dear Shareholders
In compliance with the current legislation and in accordance with the mandate given to us, we
submit for your consideration the Report and Standpoint which covers our activities and the documents of consolidated accounting of the Futebol Clube do Porto - Futebol, SAD ( “Company”), with
reference to the period from the 1st July 2008 to June 30, 2009.
We follow the activities and operations of the Company and the firms included in the consolidation
and considered with the necessary extension their accounting records. We were provided by both
the Board as by the services of the Company and the various firms included in the consolidation all
the information we need to carry out our duties.
We verified the individual and consolidated balance sheets on 30th June 2009, the consolidated accounts and consolidated results by nature of cash flows and changes in equity for the year then
ended and related Annexes.
We carried out an analysis and revision of the Annual Report for the year ended on 30 June, 2009 prepared by the Board and reviewed the Statutory Accounts and Audit Reports on the accounts and consolidated accounts prepared by the Statutory Auditors on that date, which deserved our agreement.
We also want to express our satisfaction with the sports titles reached this season by both the professional and training football.
Therefore, taking into account the above, we think that the shareholders approve the Report and
Accounts of the Company, individual and consolidated, for the period from 1 July 2008 to 30 June,
2009 as well as the application of results proposal presented by the Board.
Under the provisions of subparagraph c) of paragraph 1 of Article 245 of the CMVM, members of
the supervisory board of FC Porto - Futebol, SAD state that to the best of their knowledge, the information in the report, in the annual accounts and other accounting documents required by law or
regulation, although they have not been submitted for approval at the General Assembly, has been
prepared in accordance with applicable accounting standards, prepared in accordance with applicable accounting standards, giving a true and fair view of the asset and liabilities, financial position
and results of the issuer and the companies included in the consolidation, when appropriate, and
that the annual report faithfully exposes the evolution of the business performance and position of
the issuer and the companies included in the consolidation, contains a description of the principal
risks and uncertainties that they face.
Porto, 8 October 2009
111
112
113
114
115
C
C
0
DECLARATION
ON COMPLIANCE
116
Introduction
The revision of the Companies Act, through the entry into force of Decree-Law 76-A/2006 29 March,
resulted in a profound change in the rules relating to the government of commercial companies
in Portugal, particularly the overhaul of surveillance Corporations, by separating the functions of
supervision and audit, thus reinforcing the independence and expertise of the supervisory board
members. Consequently, the Annual General Meeting of 2007 decided to review the statutes that
included the changes imposed by that law in this important matter.
FC Porto - Futebol, SAD has always been trying, to follow the criterion of the shareholder interest
and the market, to adjust their practices so as to continue to develop towards adopting the best practices, especially with regards to values of accuracy and transparency.
In order to modernize its Statutes and consequently correspond to the most advanced practices in
corporate governance, the adjustments considered necessary in related matters such as the regulation of postal voting and the adequacy of time for participation and suspension of General Assembly
on the recommendations of CMVM were sought. These changes will be brought to the attention of
the shareholders already in the General Assembly for approval of accounts 2008/2009.
The Board pays particular attention to matters relating to Corporate Governance regarding that the
Company’s policy is consistent with the best market practices and the functioning of its governance
model is best suited to its dimension. This report is a pledge of this policy, regarding the Board of Directors that this reflects the proper functioning of the adopted model and current corporate law practice.
No constraints on its operation were found in the Corporate Governance adopted by the Company,
while observing the accuracy, honesty and trust, among others, as core values for this success. The
dynamics of the world, economy, business and capital market factors are known, so that if there are
any changes to create, to improve the governance model, it will be reviewed internally and then, if
relevant, proposed to the shareholders.
Chapter 0 - Declaration of Compliance
FC Porto - Futebol, SAD, as the issuers of shares which are admitted to trading on the official quotation
of the NYSE Euronext Lisbon (Eurolist by Euronext), prepared this report in accordance with the Code
of Corporate Governance of the Committee Securities Market Commission (CMVM), CMVM Regulation No. 1 / 2007 (now amended by Regulation 5 / 2008), which amended and revoked the CMVM
Regulation No. 7 / 2001. The regulation is available for consultation on the CMVM’s website on the
following Internet address: www.cmvm.pt.
The Company hereby adopts the recommendations issued by the Commission of Securities Market
in corporate governance and stated in the afore mentioned Code of Corporate Governance. It is
acknowledged however that there are recommendations that have not been adopted or were not
adopted in full terms.
117
C0
Declaration on Compliance
The table below identifies, in a diagrammatic way the CMVM Recommendations of the Code of
Corporate Governance, mentioning, individually, the ones that have been adopted, not adopted and
non applicable, and the reference to the text Report where it can be assessed the attainment or justification for not adopting these recommendations.
RECOMMENDATIONS ON CORPORATE GOVERNANCE
LEVEL COMPLIANCE
REPORT
I.1.1 The chairman of the General Assembly must have the human resources and
logistical support that are appropriate to his needs, considering the economic situation of society.
Adopted
1,1,
I.1.2 The chairman of the assembly remuneration must be disclosed
in the annual report on corporate governance.
Adopted
1,1,
Not adopted
1.2.
Adopted
1.2.
I.3.1 Companies should not provide any statutory restriction on postal voting.
Adopted
1.3.
I.3.2 The period of statutory notice for the receipt of the vote by
correspondence shall not exceed 3 days.
Adopted
1.3.
I.3.3 Companies must foresee in their statutes, that one vote matches each stock.
Adopted
1.2
Adopted
1.2.
Not adopted
1.2.
I.6.1 The measures to be taken to prevent the success of takeover bids should
respect the interests of the company and its shareholders.
N.A.
1.5.
I.6.2 The articles of association, while respecting the principle in the previous paragraph, provide the limitation
of the number of votes which may be issued or exercised by a single shareholder, individually or in concert
with other shareholders, shall also be documented at least every five years will be subjected to approval
by the General Assembly to maintain or not this stipulation - no aggravated quorum requirements
comparatively to the legal ones - and that at that meeting all the votes cast countwithout that limitation.
N.A.
1.5.
Adopted
1.5.
I. General Assembly
I.1. GENERAL MEETING
I.2. PARTICIPATION IN THE ASSEMBLY
I.2.1 The period of deposit or blocking of shares for participation in the General
Assembly imposed by the statutes should not exceed 5 days.
I.2.2 In case of suspension of the general meeting, the society should not force
the blockade during the whole period until the session is resumed, while the
ordinary notice required for the first ordinary session should be enough.
I.3. VOTING AND EXERCISE OF VOTING RIGHTS
I.4. QUORUM AND RESOLUTIONS
I.4.1 Companies should establish a higher constitutive or deliberative quorum than the one provided by law.
I.5. MINUTES AND INFORMATION ON RESOLUTIONS ADOPTED
I.5.1 The minutes of the General Assembly must be made available to shareholders in the company’s website
within 5 days, although they do not constitute privileged information,
according to law, and should be kept in place a collection of historical records of attendance,
of agendas and deliberations relating to meetings held at least 3 years in history.
I.6. MEASURES FOR CONTROL SHIFT
I.6.3 No defensive measures should be adopted whose effect is to automatically
cause a serious erosion of company assets in case of transfer of control or
change in the composition of the board and thus affect the free transfer of shares
and the free assessment by shareholders of the performance of members of the board.
118
II. Corporate Management and Supervision
II.1. GENERAL THEMES
II.1.1. STRUCTURE AND COMPETENCE
II.1.1.1 The board shall assess in its government report the adopted model, and identify possible
constraints on its operation and propose measures which in their opinion, are suitable to overcome them.
Adopted Introduction
II.1.1.2 Companies should establish internal control systems for the effective detection
of risks linked to the business, to safeguard its assets and enhance transparency of its corporate governance.
Adopted
2.9.
Not Adopted
2.1.4.
Adopted
2.1.1.
Not Adopted
2.1.1.
Adopted
2.2.
II.1.4.1 The company should adopt a policy of reporting irregularities allegedly occurred within it, with
the following elements: i) the means by which communications of malpractice can be done internally,
including the persons entitled to receive communications; ii) an indication of the treatment to be given
to communications, including confidential treatment, if so desired by the person declaring it.
Adopted
2.10
II.1.4.2 The outlines of this policy should be disclosed in the report on corporate governance.
Adopted
2.10
II.1.5.1 The remuneration of the members of the board should be structured to allow the alignment of their
interests and the interests of the society. Thus: i) the remuneration of directors to exercise executive functions
must include a component based on performance and should therefore take into account the performance
evaluation conducted periodically by the competent body or committee ii) the variable component should be
consistent with the company’s long-term performance maximization and dependent of the adopted variables
sustainability iii) when that is not a result of direct legal inforcement, the executive members of the board
remuneration should consist exclusively of a fixed amount.
Adopted
2.8.1.
II.1.5.2 The remuneration committee and the board must submit to the annual general meeting of shareholders
of a policy statement of earnings, respectively, of the administrative and supervisory and other leaders within
the scope of paragraph 3 of Article 248-B of the Securities in this context the main criteria and parameters for
performance assessment to determine the variable component should be explained to the shareholders,
whether regarding prizes in equities, options to purchase shares, annual bonuses or other components.
Adopted
1.4.
Not Adopted
1.4.
II.1.1.3 The administrative and supervisory bodies shall have operating
regulations which must be disclosed on the website of the company.
II.1.2. INCOMPATIBILITIES AND INDEPENDENCE
II.1.2.1 The board of directors should include a number of non-executive members to ensure the efficient
supervision, monitoring and evaluation of the activity of the executive members.
II.1.2.2 The non-executive directors should tell if an adequate number of independent directors,
taking into account the size of the company and its shareholder structure,
which may in no case be less than one fourth of the total number of directors.
II.1.3. ELIGIBILITY AND APPOINTMENT
II.1.3.1 Depending on the model followed, the chairman of the supervisory board, audit committee or the committee
for financial matters must be independent and have the skills to carry out their respective functions.
II.1.4. POLICY STATEMENT OF IRREGULARITIES
II.1.5. REMUNERATION
II.1.5.3 At least one representative of the remuneration committee must be present
at annual general meetings of shareholders.
II.1.5.4 The proposal for approval of plans to allot shares and / or options to acquire shares or based on changes in share
prices should be submitted to the General Assembly, to members of the administration and supervision and other
leaders within the meaning of paragraph 3 of Article 248. of the CMVM. The proposal should contain all the necessary
elements for a proper assessment the plan. The proposal must be accompanied by the regulation plan or, if it has
not yet been established, the general conditions that it must obey. Likewise it must be approved in general meeting the
main features of the system of retirement benefits enjoyed by members of the administration, supervision and other
leaders within the meaning of paragraph 3 of Article 248. B of the CMVM.
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N.A.
3.3.
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Declaration on Compliance
II.1.5.5 The remuneration of the management and supervision members must be disclosed annually in individual
terms, distinguishing, where appropriate, the different components received in terms of fixed remuneration and
variable different components received in terms of fixed remuneration and variable remuneration and the
companies controlled by shareholders with holdings.
Adopted
2.8.1.
Not adopted
Chapter 2
Adopted
2.1.4.
II.2.3 If the chairman of the board of directors has executive functions, the board must find effective mechanisms
for coordinating the work of non-executive members, so as to ensure that they can decide
independently and in an informed manner and they must be applied to proper explanation of these mechanisms
to shareholders in the report on corporate governance.
Adopted
2.1.1.
II.2.4 The annual report should include a description of the activities undertaken
by non-executive directors with particular reference to any constraints encountered.
Adopted
2.1.1.
II.2.5. The board must ensure rotation of the member with responsibility for finance,
at least by the end of each two terms.
Not adopted
2.1.1.
Adopted
2.1.1.
II.3.2 The chairman of the executive committee shall refer, respectively, to the chairman of the board and,
as appropriately applicable, the chairman of the supervisory board or audit committee, the invitations
and minutes of the pertaining meetings.
N.A.
Chapter 2
II.3.3 The chairman of the executive board is to provide to the general and supervision council president
and the chairman of the committee for financial matters, invitations and minutes of meetings.
N.A.
Chapter 2
N.A.
Chapter 2
II.4.2 The annual reports on the activity of the board and supervisory committee for financial matters, the audit
committee and the supervisory board should be disclosed on the website Internet da sociedade, of the
company, along with documents providing accounts.
Adopted
2.2.
II.4.3 The annual reports on the activity of the board and supervisory committee for financial matters
the audit committee and the supervisory board shall include a description of the supervisory activity
and with particular reference to any constraints encountered.
Adopted
2.2.
II.4.4 The Commission for financial matters, the audit committee and the supervisory board, depending on the
applicable model, will represent the company, for all purposes, with the external auditor responsible for, inter alia,
proposed for these services, their remuneration, to ensure they are provided within the enterprise, suitable conditions
for the provision of services, as well as being the partner of the company and the first recipient of the reports.
Adopted
2.2.
II.2. DIRECTORS
II.2.1 Within the limits established by law for each structure of management and supervision, except under
the limited size of the company, the board should delegate the daily management of the company, and
the powers delegated to be identified in the annual report on Governance.
II.2.2 The board management shall ensure that the company acts in accordance with its objectives and should not
delegate its responsibility, particularly with regards to: i) defining the strategy and general policies of the company,
ii) defining the corporate structure of the group; iii) decisions that are considered strategic because of its size,
risk or special characteristics.
II.3. CEO, EXECUTIVE COMMITTEE AND EXECUTIVE BOARD OF DIRECTORS
II.3.1 Managers who exercise executive functions, when requested by other members of the governing
bodies must provide timely and appropriately to the request, the information required by those.
II.4. GENERAL COUNCIL AND OVERSIGHT, COMMITTEE ON RAW FINANCIAL AUDIT AND AUDIT COMMITTEE
II.4.1 The general and oversight Council, besides the compliance with the supervisory powers which they have
been given, should play an advisory role, monitoring and continuous evaluation of the management of the company
by the executive board. Among the areas in which the board and the supervisory board will rule include: i) defining
the strategy and general policies of the company, ii) the corporate structure of the group, and iii) decisions
that are considered strategic because of its size, risk or special characteristics.
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II.4.5 The Commission for financial matters, audit committee and the supervisory board, depending on
the model applicable, will annually evaluate the external auditor and propose to the General Assembly
to sack them when there is just cause to do so.
Adopted
2.2.
II.5. SPECIALIZED COMMITTEES
II.5.1 Unless presenting the reason of the small size of the company, the board of directors and general council and
supervision, depending on the model adopted, will establish the necessary committees to: i) ensure a competent
and independent evaluation of the executive administrators performance and to assess their own overall performance,
as well as the various existing committees, ii) ponder upon the adopted governance system to check its effectiveness
and propose to the competent bodies to be implemented with a view to its improvement.
N.A. 2.6. and 2.7.
II.5.2 The members of the remuneration committee or equivalent should be independent
from the members of the board.
Adopted
2.6.
II.5.3 All committees will keep minutes of meetings held.
Adopted
Chapter 2
Adopted
3.8.
Not adopted
3.8.
III. Information and Audit
III.1. DUTIES GENERAL INFORMATION
III.1.2 Companies should ensure the existence of permanent contact with the market, abiding to the principle
of equality among shareholders and preventing asymmetries in information access by investors.
To this end, the company should maintain an office of investor relations.
III.1.3 The following information is available on the website of the company and it will be published in English:
a) the name, the company status, the headquarters and other elements mentioned in Article 171.
of the Companies Act;
b) Statute;
c) Names of corporate officers and the representative for market relations;
d) Office of Investor Assistance and their respective roles and means of access;
e) Documents of accountability;
f) Semester calendar of corporate events;
g) Proposals submitted for discussion and vote in general meeting;
h) Calls for the implementation of the general meeting.
The Board Members, except for the executive members of the Board of Directors are considered independent, being its independence each time measured by an explicit declaration of the same. Members of the
Board are not independent, in that all except for Jaime Eduardo Lamego Lopes, part of the Directorate
of FC Porto, holds 40% stake in FC Porto - Futebol, SAD, and that on it has a dominant influence. Jaime
Eduardo Lamego Lopes, executive director, is independent.
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1
GENERAL ASSEMBLY
122
Chapter 1 - General Assembly
1.1. Members of the General Meeting
The General Assembly is the highest organ of the Society, consisting of the universality of the shareholders. Shareholders at their annual meeting take decisions on statutory changes, to conduct an examination of the management and supervision of the Company, discuss the annual report and accounts,
to elect the governing bodies of their competence. In general, the General Assembly also decides on any
issue that has been convened and on all matters that are specifically assigned by law or by agreement of
the Company and which are not included within the remit of other bodies of the Company.
The General Meeting held on February 29, 2008 decided the election for four years 2008/2011, of José
Manuel de Matos Fernandes as Chairman of the General Assembly, and Rui Miguel de Sousa Simões
Fernandes Marrana as Secretary of General Meeting.
The members of the General Assembly of FC Porto - Futebol, SAD are not paid for performing their
functions in society.
The Chairman of the General Assembly provides human resources and logistical support appropriate to their needs and to fulfill their duties, considering the size of the Company, including the
support and cooperation rendered by the Secretary of the Company, the Legal Office and the Office
Management Control of FC Porto - Futebol, SAD.
1.2. Participation in the General Assembly
FC Porto - Futebol, SAD, prior to each General Assembly, and respecting the legal deadlines, makes
the publication of the notice of meeting, including on the site of the Company (www.fcporto.pt).
In accordance with the provisions of the Association Articles the shareholders entitled to vote may
participate in General Meeting, showing their status as shareholders in a letter issued by a financial intermediary, with its block of shares for participation in the assembly which is received at the
headquarters of the Company within eight days before the date of the General Assembly. In the
accounts approval General Assembly 2008/2009 an amendment to the statutes for the shortening of
this notice to five days will be put to the attention of shareholders, as recommended by the CMVM.
However, the past Presidents of the General Meeting have understood that taking into account the
issues associated with the time of receipt of declarations for blocking shares, whether to accept those whose copies are received by fax or e-mail to the period specified in the Constitution and confirmed by the receipt of the documents until the day before the General Meeting.
Shareholders who are individuals may be represented at meetings of the General Assembly under
the conditions defined by law. Legal collective persons will make themselves represented by a person designated for that purpose and their authenticity will be appreciated by the Chairman.
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The Company makes available to the Shareholders a form of letter of representation that can be obtained by request addressed to this Society, by phone (+351225070500) or via e-mail ([email protected]).
The instruments of voluntary representation should be submitted to the head office, addressed to the
Chairman of the General Assembly at least three days prior to the date of the General Assembly, and by
specifying the meeting to which it relates, the date, time and place in which it is conducted and their
agenda, verify their clear mandate to the representative, with proper identification of the latter.
In case of suspension of the meeting of the General Assembly, and given that there is no provision
in the Statute obligation of the Company, considering the view expressed by the Chairman of the
General Assembly, the Company considers adopted the understanding contained in the Recommendation I.2.2 Code of Corporate Governance CMVM about not being required in the event of suspension of the meeting of the General Assembly, blocking the entire period until the session is resumed,
and sufficient advance required for the first ordinary session. In any case, the amendment of the
Statute that will be put to the consideration of shareholders at the General Assembly for approval of
accounts 2008/2009 will rectify this situation.
For the purpose of exercising the right to vote, each share has one vote, and the presence in the General Assembly is not subject to imprisonment of a minimum number of shares.
In accordance with article twenty of the Statute, the General Assembly will act regardless of the
number of shareholders present or represented, both in first and second call, subject to the statutory
requirement for certain constitutive quorum for certain actions and, in particular the need in the
the first call, are present or represented shareholders with at least two-thirds of the votes for the
Assembly to authorize any of the acts referred to in article thirteen, number two, of these Statutes
( “They need authorization from the general acts which exceed the forecast in the budget by resolution passed by simple majority, and the alienation and encumbrance of any type of assets making up
the estate of the Company, by resolution approved by two-thirds of the votes cast “).
The minutes of the General Assembly and the historical collection of primary information on these
meetings have been sent to shareholders who request them. Currently, the Company is preparing its
website to disclose this information.
1.3. Exercise of Voting Rights by correspondence and by Electronic Means
There are no statutory rules that prohibit the right to vote by post.
It is allowed under the provisions of Article 22 of the CMVM, the vote by correspondence, and explanations of vote, addressed to the Chairman of the General Assembly, delivered to the Society’s
headquarters, located at Estádio do Dragão Via FC Porto, entrada poente, 3rd floor, in Oporto, up to
18 hours of the 3rd business day preceding the day appointed for the General Assembly, in a sealed
envelope, with signatures of Shareholders to be notarized or certified by the Company. In any case,
the amendment of the Statute will be put under the consideration of the shareholders will regulate
this at the General Assembly for accounts approval 2008/2009.
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In order to facilitate voting by correspondence, FC Porto - Futebol, SAD provides a model ballot paper
for this purpose and can be obtained by request addressed to this Society, by phone (+351225070500)
or via Email ([email protected]).
The possibility to exercise voting rights by electronic means is not yet foreseen.
1.4. Intervention by the General Assembly regarding the Remuneration Policy of the Company
It was not submitted to the Annual General Meeting of shareholders, until the date of this report, any statement on the remuneration policy of the Company or on the performance evaluation of board members.
However, given the publication of Law No. 28/2009, the Remuneration Committee must be approved by the General Assembly for the year ending on December 30 2009, a statement on the remuneration policy for members of its Board of Directors and Surveillance. In the General Assembly for
approval of accounts 2008/2009 the afore mentioned declaration will be presented and put under
consideration of the shareholders.
Also note that, although no member of the Compensation Committee was at the last General Assembly, it is expected that this situation will change during the next Assembly.
1.5. Measures concerning the change of control
FC Porto - Futebol, SAD did not introduce any defensive measures designed to have the effect of an automatic
and severe erosion of the assets of the Company in the event of transfer of control or change the composition
of the board and thus affect the free transfer of shares and discretion by the shareholders of the performance
of board of directors.
In particular there are no significant agreements to which the Company is a party and which take effect, alter
or terminate in the event of a change of control of the Company following a takeover bid, or agreements between the FC Porto - Futebol, SAD the members of the board of directors or employees providing for compensation in case of resignation or dismissal of members of the board, or in case of resignation of the employee,
unfair dismissal or termination of employment, following an offer takeover.
Similarly, FC Porto - Futebol, SAD did not adopt any measure which aims to prevent the success of takeover
bids that violate the interests of the Company and shareholders.
In any case, the existence of legal restrictions on the ownership of shares representing the share of FC Porto Futebol, SAD is notorious, arising from the special demands of the sport that is their primary purpose. Sports
societies are governed by special legal regime established by Decree-Law 67/97 of 3 April according to the changes that were introduced by Law No. 107/97 of 16 September. Among these characteristics is noted:
• The existence of two classes of shares, considering that Class A shares are those subscribed and
held at any time, by the founder club, which are only liable to seizure or encumbrance in favour of
legal persons of public law;
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General Assembly
• The special system of company loyalty to the founder club, reflected in particular by the club’s obligation to maintain a minimum holding in the Company (not less than 15% nor more than 40%),
the granting of special rights to the shares held the club founder and the creation of encumbrances
in favour of the club members;
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2
GOVERNING BODIES
128
Chapter 2 - GOVERNING BODIES
The Governing Bodies of FC Porto - Futebol, SAD are the General Assembly, the Board of Directors,
the Audit Committee, Statutory Auditors, the Company Secretary, the Advisory Board and the Remuneration Committee.
General Assembly
Advisory Board
Statutory Auditors
Remuneration Committee
Board of Directors
Audit Committee
Company Secretary
FC Porto - Futebol, SAD has no executive committee, given its small size, considering the Management Board responsible of ensuring the daily management of the Company.
The members of the governing bodies have a duration of four years, and may be re-elected by one or
more times.
2.1. Board
According to the Articles of Association, this one is managed by a Board of Directors, composed of
three, five, seven or nine members who must compulsory be, professional managers, elected by the
General Assembly, which will designate the president if he has not already been appointed at that
meeting.
This body is currently composed of 5 members, 4 of which executives, who are responsible for the
management of the Company.
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Governing Bodies
The replacement of an administrator will take place under the Companies Act, and there are no statutory rules on this subject, occurring at one of the following: lack of Substitute directors, the Board may
proceed with the co-option of an administrator, which must be subject to ratification at the next General
Meeting or, where provision is made for co-option within 60 days, the supervisory board administrator
designates a substitute, which shall also be subject to ratification at the next General Meeting if it does
not occur replacement far will be through the election of a director by the General Assembly.
2.1.1. Division of powers between directors
The current Board consists of five members, four officers and one non-executive, although in the General Assembly for the election of governing bodies has not been identified as such. Their positions
are distributed as follows:
Board
Jorge Nuno Lima Pinto da Costa
Chairman of the Board of Directors
Football Area
Finance and Administration,
Capital Markets
Legal Marketing and Public Relations
Non-Executive Administrator
Members of the Board, with the exception of Jaime Eduardo Lamego Lopes, are not independent,
as they are part of the Directorate of FC Porto, which holds about 40% stake in FC Porto - Futebol,
SAD, and to which it exercises a dominant influence. Jaime Eduardo Lamego Lopes is currently an
independent member.
FC Porto - Futebol, SAD does not comply with the recommendation II.1.2.2, which recommends at
least a quarter of the total number of directors to be non-executive and independent, given the small
size of the Board of Directors, and because of their executive members they are very devoted to the
management of the company.
The executive director has performed his duties not only in attendance at meetings of the Board, but also
through monitoring and continuous supervision of the work of the executive administrators, upon presentation of coordinated and efficient requests for additional information connected with issues raised
in the Council of Directors, among which are the subjects related to the financial aspect, the material
and governance matters relating to regulatory issues. Note that the non-executive administrator has not
encountered any constraint in carrying out their duties.
Whenever requested by other members of the Governing Bodies, the information has been provided
by the executive directors in a timely and appropriate manner.
130
The Company does not meet or agree with the recommendation II.2.5.’s Claim that the Board of
Directors must ensure rotation of the member with responsibility for finance, at least after every
two terms.
First, the goal of that recommendation is not seen. It is a matter of strategic interest to be determined by the Company and its shareholders, according to their specific model of government and the
practical application of which it is done. The finance function has special features of each type of
business and cannot be carried across without regards to the characteristics of the areas where the
companies are active. Most times, this experience takes more than a mandate to acquire. To claim
that after the integration period, the member with responsibility for financial should cease these
functions, in terms of the deal, an option that can be counterproductive for society.
It is known that Portugal is a small country with a peripheral economy and unattractive labor market when compared with the countries of Western Europe. Moreover, the regime of incompatibilities and independence referred to in the Companies Act is particularly heavy. The combination of
these factors is already limiting the choice of members of the administrative and monitoring bodies.
Adding the observation of the recommendation in question, it seems that it is alienating the very
latitude that a society should have to choose the best people for certain positions.
Moreover, the recommendation seems to suggest that within the Board of Directors there is no rotation of the financial portfolio, i.e., in the same universe of managers. In the particular case of FC
Porto - Futebol, SAD, adopting this recommendation would be seriously detrimental to the operational
management of the Company, as each member of the Board assumes the portfolio that best suits their
skills and experience and carried out activities.
The CMVM should therefore adjust this recommendation and adapt it to the type of company involved and the practice of national societies.
2.1.2. Functions Performed by the Members of the Board in other companies
Jorge Nuno de Lima Pinto da Costa
• Chairman of the Board of FCPorto
• Chairman of the Board of InvestiAntas, SGPS, SA
• Chairman of the Board of EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, SA
• Chairman of the Board of PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, SA
• Chairman of the Board of Directors of Fundação PortoGaia para o Desenvolvimento Desportivo
• Chairman of the Board of FCPortoMultimédia, Edições Multimédia, SA
• Chairman of the Board of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
• Chairman of the Board of Futebol Clube do Porto - Basquetebol, SAD
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Governing Bodies
• Vice-Chairman of the Board of FCPorto
• Member of the Board of Directors of Investiantas, SGPS, SA
• Member of the Board of Directors of EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, SA
• Member of the Board of Directors of PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, SA
• Member of the Board of Directors of FCPortoMultimédia, Edições Multimédia, SA
• Member of the Board of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
Reinaldo Teles da Costa Pinheiro
• Member of the Board of Directors of EuroAntas, Promoção e Gestão de Empreendimentos Imobiliários, SA
• Member of the Board of Directors of FCPortoMultimédia, Edições Multimédia, SA
• Member of the Board of PortoComercial, Sociedade de Comercialização, Licenciamento e Sponsorização, SA
• Member of the Board of Directors of PortoEstádio, Gestão e Exploração de Equipamentos Desportivos, SA
• Member of the Board of Directors of FC Porto - Basquetebol, SAD
• Managing Partner of Fitout Unipessoal Lda
2.1.3. Professional qualifications, tasks, mandate and shares held
• Professional qualifications and activities carried out in recent years
• Education: Secondary complete
• Other positions held at FC Porto Group, referred to in section 2.1.2.
132
• Degree in Law in 1980
• Lawyer since 1980 until today
• Member of the Law Firm Graça Moura & Associates from 1996 to 2005
• Member of the Law Firm Gil Moreira dos Santos, Caldeira, Cernadas & Associates since 2005
• Other positions held FC Porto Group, referred to in section 2.1.2.
• Degree in Economics in 1976
Reinaldo Costa Teles Pinheiro
• Education: 1st Cycle of Basic Education
• Enterprise Manager, was for 14 years manager of Amorim Imobiliária and CEO of Chamartin Imobiliária
• Master in Science in Management (MsC) pela London Business School com tese sobre “Real Estate
Valuation - Analysis of the Main Methodologies” em 1996/98
• MBA from the University of Porto in 1989
• Degree in Economics from the Faculty of Economics of Porto
• For ten years, Professor responsible for the subject of “Analysis of Investment Projects” (Project
Analysis and Capital Budgeting) in the Faculty of Economics, University of Porto
• Other positions referred to in section 2.1.2.
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Governing Bodies
• Shares held and mandate
Name
No. of shares held
Date of 1st appointment
Expiry mandate
175.000
23-Set-1997
31-Dec-2011
0
23-Set-1997
31-Dec-2011
960
30-Oct-2000
31-Dec-2011
9.850
23-Sep-1997
31-Dec-2011
0
29-Feb-2008
31-Dec-2011
Jorge Nuno L. Pinto Costa
Adelino S. M. Caldeira
Fernando S. Gomes Silva
Reinaldo C. Teles Pinheiro
Jaime E. Lamego Lopes
2.1.4. Duties of the Board of Directors
Notwithstanding the other powers conferred by law and the Statutes, the Board is responsible for
the management of all business and conduct all operations relating to the objects in which they
were granted the broadest powers, namely:
a) Represent the Company in and out of court, propose and contest any action, compromise and
give up themselves and engage in arbitrage. To this end, the board may delegate its powers to one
representative;
b) Develop the company’s budget for approval by the General Assembly;
c) To acquire, dispose of and encumber or lease movable property, including stocks, shares, bonds
and rights of registration of players;
d) Enter into employment contracts and contracts for sports training and provide for their termination, either unilaterally or by mutual agreement;
e) To acquire real estate;
f) Decide that the Society will join with other under article four of the Statute;
g) Decide to issue bonds and borrow on the domestic or foreign financial market and accept the
supervision of the various lenders;
h) Appoint any other person, individual or collective, for paid positions in other companies.
134
Any increase in capital needs deliberation by the General Assembly, and the class A shares, held by
FC Porto (Club), always confer the right to veto decisions of the General Assembly designed to, inter
alia, a joint capital raise or reduction.
The matters discussed in this body are of sensitive nature and its members must respect this principle.
The bodies of supervision and administration of FC Porto - Futebol, SAD do not have operating regulations formally adopted given the small size of the Company. However, the Company is preparing
to draw up such regulations, intending to make it available in due course in its website.
There is a list of incompatibilities defined by the board, nor is it defined a maximum number of
positions that may be directors on the board of other companies.
This year the Board of Directors met 15 times.
2.2. Audit Committee
The supervision of the Company’s activity is the responsibility of the Audit Committee which, according to the Bylaws of the Company, It has the powers specified in the Act.
With the entry into force of Decree-Law 76-A/2006 29 March, which now offers three ways of organizing the administration and supervision of companies, FC Porto - Futebol, SAD changed their statutes
in administration and supervision in order to adopt one of three methods provided in paragraph 1 of
Article 278 of the Companies Code. Consequently, the Company, in the General Assembly of 30 November 2007, approved amendments to the Statute, and elected until the end of the mandate of the governing bodies that was open until December 31, 2007, members of the Audit and Statutory Auditors.
At an Extraordinary General Meeting held on 29th February 2008 for the term 2008/2011, the following elements to join the Supervisory Board were elected:
Audit Committee
• Adolfo da Cunha Nunes Roque
• Filipe Carlos Ferreira Avides Moreira
• Armando Luís Vieira de Magalhães
• José Manuel Taveira dos Santos (Substitute)
However, on the death of the President of the Audit Committee, Adolfo da Cunha Nunes Roque, on
22nd September 2008, a new Audit Committee was elected at the General Assembly on 13th November 2008.
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Governing Bodies
The current supervisory board of FC Porto - Futebol, SAD is composed of the following members:
Audit Committee
José Paulo Sá Fernandes Nunes de Almeida
President
vowel
vowel
José Manuel Taveira dos Santos
Substitute
It is mandatory that one of the members of the Audit Committee is a statutory auditor (or auditors
societies).
There are potential conflicts of interest between the obligations of any of the people that make up
the administrative, supervisory and senior management for the Company or any of its subsidiaries
and their private interests or obligations.
The Fiscal Council is reviewing the activities of the Company, in full compliance with the strict law
and the Statute. As a result, the Audit Committee shall, on an annual basis, report on the action and
issue an opinion on the documents of accountability and the proposed appropriation of results,
presented by the Board to the General Assembly.
It must also represent the Company for all purposes at its External Auditor, responsible for, among
others, propose the person responsible for these services, their remuneration, to ensure they are secured within the company, proper conditions to the provision of services, as well as being the partner of
the company, as the recipient of the reports at issue, together with the Board of Directors.
The Audit Committee, whenever appropriate, meets with the External Auditor not only in its own
name but also in the Company’s, pursuant to its powers. It is not under his role, however, to propose
the provider of the External Audit, given his recruitment precedes the appointment of a separate Audit
Committee of the Statutory Auditors. The outside auditing services have been analyzed independently
and standing by the supervisory board, issuing an opinion on the annual activity of the Auditor during
the year and making mention of facts which could hinder the continuity of the office for cause. The
Audit Committee is, together with the Board of Directors, the first recipient of the reports issued by
the external audit firm.
This year the Audit Committee met on 4 occasions.
The annual reports on the activity of the Audit Committee are disclosed on the website of the Company, together with the documents of accountability.
136
2.2.1. Functions Performed by members of the Audit Committee in other companies
• Managing Partner of TRL - Têxteis em Rede, Lda
• Managing Partner of Expomoda - Têxtil e Representações, Lda
• Vice-President of the Board of Sport Club do Porto
• Member of the Executive Board of the Project Portugal Fashion
• Member of the Monitoring Committee of the Prime - Programa de Incentivos à Modernização da
Economia
• Chairman of the General Assembly of AAJUDE - Associação de Apoio à Juventude Deficiente
• Chairman of the Audit Committee of the Associação Fórum Manufacture Portugal
• Chairman of the General Council of PortoLazer - Empresa Municipal
• Member of the Advisory Board of Fundação da Juventude
• Vice-President of the General Council and the Board of Directors of AEP - Associação Empresarial
de Portugal
• Chairman of the Board of EURISKO Estudos, Projectos e Consultoria, SA
• Member of the Associação para a Feira Internacional do Porto - Exponor
• Vice-Chairman of the Board of Europarque - Económico e Social
• President of the General Council of Exponor Brazil - Feiras e Eventos, Lda
• Chairman of the Board of CESAE - Centro de Serviços e Apoio às Empresas
• Member of the Audit Committee of Sonae Indústria, SGPS, SA
• Member of the Audit Committee of Sonae Capital, SGPS, SA
• Member of the Audit Sonaecom, SGPS, SA
• Member of the Audit Committee of the Fundação Eça de Queiroz
• President of the General Assembly of the CPC AFRICA, SA
• Currently not belonging to the governing bodies, nor performing any executive functions in other
societies to which he belongs.
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Governing Bodies
2.2.2. Professional qualifications, tasks, mandate and shares held
• Professional qualifications and activities carried out in recent years
• Degree in Economics from the Faculdade de Economia do Porto
• Technical Sales Department at the Banco Português do Atlântico from 1982 to 1984
• Director of the Company Sofite - Sociedade Industrial de Fibras Têxteis, SA from 1984 to 2005
• Partner - Manager of the ATM - Gabinete de Gestão, Lda from 1984 to 2004
• Manager of the Gorem - Sociedade Técnica de Serviços, Lda from 1990 to 2000
• Administrator Risfomento - Sociedade de Fomento Empresarial, SA from 1991 to 1993
• Managing Partner of theCompany Ninfamar - Indústria de Confecções, Lda from 2002 to 2004
• Vice-President of ANJE - Associação Nacional de Jovens Empresários 1986 to 1996
• President of the General Assembly of ANJE - Associação Nacional de Jovens Empresários 1996 to 2002
• Director of APET - Associação Portuguesa dos Exportadores de Têxteis from 1991 to 1994
• Vice-President of the General Council of the APT - Associação Portuguesa de Têxteis e Vestuário from
1994 to 2003
• Member of the Economic and Social Council from 1996 to 2000
• Director of the Associação Comercial do Porto - Câmara de Comércio e Indústria do Porto from 1997 to
2001
• Member of the National Commission for Monitoring the IMIT - Iniciativa para a Modernização da
Indústria Têxtil from 1997 to 2002
• Member of the Audit Committee of MTV - Movimento do Têxtil e do Vestuário from 2001 to 2003
• Chairman of the General Office of the Associação Gabinete de Desporto do Porto from 2002 to 2006
• Chairman and CEO of ATP - Associação Portuguesa de Têxteis e Vestuário de Portugal from 2003 to 2008
• Vice-Chairman of the Board of the CIP - Confederação da Indústria Portuguesa from 2004 to 2008
• Member of the General Council and the Board of Directors of AEP - Associação Empresarial de
Portugal from 2005 to 2008
• Vice-Chairman of the Supervisory Board of the FC Porto from 2007 to 2008
• Other positions referred to in 2.2.1.
• Executive MBA - European Management (IESF / IFG), completed in 1996
• Degree in Economics from the Faculty of Economics of Porto, completed in 1972
138
• Degree in Accounting (former and current ISCAP ICP), completed in 1972
• From 1964 to 1989 he pursued his work in Portuguese credit institution and has held the following
functions:
* Technical Analysis of the Department of Management;
* Head of Office of Planning and Management Control in the Northern Region;
* Head of Services Department of Accounting;
* Deputy Director;
* Deputy Director, appointed to head the department Executive Operation North.
• Certified Public Accountant since 1972
• Statutory Auditor, individually, since 1989
• Statutory Auditor, integrated in society Santos Carvalho & Associados, SROC, SA since 1989
• Frequency of Graduate Public Law - The New Legal Director, Catholic University of Portugal, during 2002/2003;
• Accounting Course for Lawyers and Engineers Portuguese Catholic University, concluded in June
1998;
• Postgraduate in European Studies at the Center for European Studies, Faculty of Law of Coimbra,
concluded in December 1997;
• Course of Commercial Law (Public Company) at Facoltà di Giurisprudenza dell’Università di Roma
“La Sapienza” (Italy) - in the 1st semester of 1995/96, under the ERASMUS project;
• Degree in Law at the Law Faculty of Coimbra, concluded in October 1996
• Associate Attorney of Cuatrecasas, Gonçalves Pereira & Associates, since 2009.;
• Instructor of the Law Bar, District Center of Porto, in the module “Company Law” since the year
2006;
• Practiced as a lawyer in a law firm in Oporto (in his own name and as a collaborator / associate of
the Society of Advocates Cerqueira Gomes & Associados) from 2001 to 2009;
• Lawyer of Porto City Council of March 2003 to June 2004;
• Practiced as a lawyer in law firm in Macau (Drª Manuela António) from April 1999 to April 2001;
• Practice as a lawyer in a law firm in Oporto since February 1999;
• Service provider of forensic and legal counsel in his own name and as a contributor of lawyers /
Law Firm aforementioned interventions in the areas of law, civil and commercial matters;
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Governing Bodies
• American Language Institute in 1984
• Course for European Studies, Faculty of Law of Coimbra, concluded in 1984
• Degree in Economics from the Faculty of Economics of Porto, completed in 1981
• Commercial Institute of Porto, completed in 1974
• General Course of Trade, Oliveira Martins School, completed in 1971;
• From 1981 to 1983 he pursued his work in textile undertaking, in the administrative and financial
• From 1983 to 2009 he pursued his work in AEP - Associação Empresarial de Portugal, having held
the following functions:
* Technical Office for Economic Studies;
* Area Director of Training;
* Area Director of Information and Business Services;
* The Editor of “The Industry of the North”;
* Director of International Area;
* Director of Europarque - Congress Center;
* Director of the Office of the Board of Directors;
* Advisor to the President.
• Entrepreneur-in services and consulting “Taveira dos Santos, Lda” since 2009
• Participation in various societies
• Member of the Technical Commission for the Organization of 1. AND 2. Congress of the Business
Council of America in 1982 and 1987;
• Member of the Technical Educational Program insertion in the work of Young Technicians Industry, launched by the Ministry of Industry, 1985 to 1987
• Member of the Board of the Luso-American Institute for Training 1991 to 1994
• Member of the Board of the Council for Higher Education Cooperation Company from 1991 to 1994
• Coordinator, in Portugal, of the Program of Cultural Dynamism and Business promoted by the
Hispano-Portuguese Foundation Rei Afonso Henriques 1996-1998
• Project coordinator Industryportugal.com, an e-market-place from 1999 to 2001).
140
• Shares held and mandate
Name
Nº of shares held
Date of 1st appointment
Expiry mandate
100
13-Nov-2008
31-Dez-2011
0
29-Fev-2008
31-Dez-2011
10
29-Fev-2008
31-Dez-2011
0
29-Fev-2008
31-Dez-2011
2.3. Statutory Auditors
It is the auditor’s job to examine and audit the Company’s accounts, which is necessary to review
and legally certify the accounts.
The post of Statutory Auditors of the Company is played by the Society of Accountants Deloitte,
Statutory Auditors, based in Building Atrium Saldanha Praça Duque de Saldanha, 1 - 6 º 1050-094 Lisboa, Board of Statutory Auditors under paragraph 43 and registered with the CMVM under number
231, represented by Jorge Manuel Araújo de Beja Neves (ROC No. 746).
2.4. Company Secretary
The Company Secretary and Substitute are appointed by the Board of Directors, hold office for the
term of office of the board that has elected. The Secretary is primarily secretarial meetings of the
governing bodies, make the acts performed by them and the powers of its members meet the demands of shareholders in exercising their right to information and make copies of records and other
company documents.
For the current term of office of 2008-2011, the Secretary and his Substitute are;
• Secretary: Daniel Lorenz Rodrigues Pereira
• Substitute: Urgel Horta Ricardo Santos Brandão Martins
The Company Secretary and the Deputy Secretary were re-elected by the current Board of Directors.
2.5. Advisory Board
The Advisory Board is composed of a maximum of twenty members and has no functions. To this
body, responsible for advising the Board of Directors, there are no binding on the issues that this
agency intends to submit for consideration.
The current Advisory Council FC Porto - Futebol, SAD (four-2008-20011) is composed of the following members:
141
C2
Governing Bodies
• Alípio Dias (President)
• Álvaro Pinto
• Álvaro Rola
• Américo Amorim
• António Gonçalves
• António Lobo Xavier
• Armando Pinho
• Artur Santos Silva
• Elisa Ferreira
• Fernando Pimenta
• Fernando Póvoas
• Ilídio Pinho
• Ilídio Pinto
• João Espregueira Mendes
• Poncio Monteiro
• Jorge Armindo
• Jorge Nuno Pinto da Costa
• Ludgero Marques
• Rui Alegre
2.6. Remuneration Committee
The Remuneration Committee of FC Porto - Futebol, SAD has to fix the remuneration of the Executives of the Company and set the remuneration policy to be applied to the Board of Directors of FC
Porto - Futebol, SAD.
The present Remuneration Committee of FC Porto - Futebol, SAD (four-2008-20011) entails the following members:
• Alípio Dias (President)
• Joaquim Manuel Machado Faria de Almeida
• Fernando Freire de Sousa
The Remuneration Committee is composed by members independent of the administration. To that
extent, the Compensation Committee does not include any member of another governing body for
142
which to set their remuneration, in which the three members have no familiar relationship with
members of other bodies, including as their spouses, kin or straight line to the 3rd degree.
This Society aims to encourage the presence of representatives of the Compensation Committee at
the General Assembly so that they can, if necessary, intervene in matters within their competence.
At each meeting of the Remuneration Committee the pertaining minute is drawn.
2.7. Other Committees
Taking into account the corporate governance model implemented by FC Porto - Futebol, SAD, which includes a Remuneration Committee, which somehow evaluates the management performance, and the small
size of the Company, it has been understood that there is no room for the creation of specialized committees
with the sole purpose of evaluating the performance of the executive administrators or the activity of existing committees.
On the other hand, the FC Porto - Futebol, SAD, for its specific operating field as a sports company, has in the
exercise of its activity a number of obligations to comply with sporting bodies. In order to be able to participate in national and European competitions, the Company must demonstrate that it meets a number of
requirements, with a strong focus on the financial ones, that somehow validate the competence of the administration, which if the stipulated conditions are not met, exclude the team’s participation in the trials.
2.8. Remuneration of Executives
2.8.1. Remuneration of the Board of Directors
In accordance with its responsibilities, the Compensation Committee established the parameters
of remuneration of the Board based on a fixed component and a variable, with the aim of making
it competitive in the market and serve as a motivation for high individual and collective performance, which would establish and achieve ambitious goals, appropriate to what is required by key
stakeholders.
The President of the Board and the other directors of the Company are entitled to a compensation
variable, depending on the sporting performance of the first team of FC Porto, made up of percentages of their annual gross salary: National Champion (75%) or 2nd and 3rd places of the National
Championship (50%); Winner of UEFA Europa League (100%) or winner of UEFA Champions League
(120%). However, the Board, in the General Assembly of 13 November 2008, declared and already
released its renunciation of the prize for the2nd and 3rd places at the National Championship.
The remuneration of the members of the board are not dependent on shares price quota or any other
variable in addition to the profits made and sporting performance in each exercise. The Chairman
of the Board and the other directors of the Company will also be entitled to receive, respectively, 2%
and 1% of the profits made at the end of each financial year.
143
C2
Governing Bodies
Members of the Board of Directors of FC Porto - Futebol, SAD are not paid by other group companies or
companies controlled by shareholders with holdings.
There is no defined policy or measure towards giving contract negotiated compensations in the event of
termination of service or retirement.
The remuneration during the year to members of the Board of Directors of FC Porto - Futebol, SAD, amounted to 1,915,815 EUR 1,075,815 corresponding to the fixed part of the fee and the variable portion 840,000.
These earnings in the year in question, by all the members of the board, relates exclusively to the executive.
Name
Remuneration
700.000
420.000
420.000
375.815
0
2.8.2. Remuneration of other Executives Bodies
During the year which ended on June 30, 2009, the fees paid by companies belonging to the consolidation of FC Porto - Futebol, SAD to its Statutory Auditors and external auditors were as follows:
1. Service statutory accounts: 74,900 Euros
2. Other services: 72.500 Euros
Additional services were performed by different business areas of Deloitte and using completely
separate teams and technicians who perform these works who are different from those involved in
statutory audits, so that ,we believe, it reinsures its independence.
The remaining members of the Governing Bodies of the Company: Audit Committee, Company Secretary, Advisory Board and the Compensation Committee are not paid for performing such duties
at FC Porto - Futebol, SAD.
2.9. System of internal control and risk management
FCP-SAD does not have specific units dedicated to internal control, however, an Office of Management Control exists, which consists of two professionals who have responsibilities in the detection
of risks linked to the company’s business. The control system implemented in the risk society is
intended primarily to support the administration in the detection of relevant financial risks, mainly
144
by regular, comprehensive information for planning and financial control, including the business
plan, operating budgets and treasury and its control, management indicators, among others. These
procedures contribute to help the quality of disclosed information to the market. The Office of Management Control is a department that depends on the Board of Directors of the Company.
The Board believes that FC Porto - Futebol, SAD is exposed to normal risks associated with its activity. Thus, the main risks to which the Company believes to be subjected to are at the financial level:
market risk (interest rate risk and exchange rate), credit risk and liquidity risk. The mechanisms for
monitoring these risks are described in the notes to the financial statements.
In addition to the financial risk, the business of the Company is also very dependent on the sporting performance of its main football team. Sporting success is essential to obtain the traditional
incomes and the values of its assets, which once transferred generate income that is essential to the
Company’s business.
The FC Porto - Futebol, SAD has a team of specialists whose goal is to get their athletes to give an
optimum yield. For that it has at its disposal a technical team, able to evolve their athletes, a medical
team and physical fitness to prevent diseases and injuries and a team of psychologists, who promote
emotional stability and a winning spirit to its players.
2.10. Reporting of irregularities
Although the policy statement of internal irregularities is not formally defined, taking into account
the proximity of the members of the Board of the activities of the Company and its employees, FC
Porto - Futebol, SAD considers that such proximity allows to whichever irregularities may appear
they should be reported promptly to the Board, which ensures the implementation of procedures
aimed at dealing effectively and fairly with any irregularities. At the level of expertise in evaluating
ethical issues, the structure and governance of such functions are performed directly by the Board,
specifically by the administrator, with responsibility law, which maintains a constant debate on the
issue. Irregularities in the Society have ensured confidentiality and its sequel by any preliminary investigation of the responsibility of those who, to this end will be designated by the administrator.
145
146
147
C
3
INFORMATION
148
Chapter 3 - INFORMATION
3.1. Capital Structure of Company
The joint capital is seventy-five million, and is divided into fifteen million shares of Class A and
Class B (respectively 40% and 60% of capital), depending on the identity of its owner. The class A
shares are only part of this category while in possession of FC Porto, or holding company of shares in
which the Club owns the majority of the capital, automatically converting into shares of class B in
the case of the sale third in title. For the purpose of exercising the right to vote, each share represents
one vote. The class A shares always confer the right to veto the resolutions of the General Assembly
designed to the merger, division, transformation or dissolution of the Company and amendment of
its Statute, the increase and reduction of share capital and change in the location of the head office.
3.2. Qualifying holdings
Under and for the purposes of Articles 16 and 20 of the Cmvm and Article 448 of the Companies Act,
it is reported that the Company and / or individuals who have a qualified social participation that
exceeds the 2% 5%, 10%, 20%, a third, 50%, two thirds and 90% of the vote, according to reports
received at the headquarters of the Company to date are as follows:
N.º of Shares
% Rights of vote
6.000.000
40%
175.000
1%
Through Reinaldo da Costa Teles Pinheiro
9.850
0%
Through Fernando Soares Gomes da Silva
960
0%
6.185.810
41%
N.º of Shares
% Rights of vote
2.718.185
18,12%
N.º of Shares
% Rights of vote
1.650.750
11,01%
980
0,01%
1.651.730
11,01%
Directly
Through Jorge Nuno de Lima Pinto da Costa
Total
Imobiliária Chamartín
Through the company Aplicação Urbana II - Investimento Imobiliário, SA
António Luís Alves Oliveira
Directly
Through Francisco António de Oliveira
Total
149
C3 Information
Joaquim Francisco Alves Ferreira de Oliveira
N.º of Shares
% Rights of vote
Through the company Sportinveste - SGPS, SA
1.502.188
10,01%
Note: The Company APLICAÇÃO URBANA II – INVESTIMENTO IMOBILIÁRIO, SA is owned 50% by CHAMARTIN IMOBILIÁRIA, S.G.P.S., SA The
Company CHAMARTIN IMOBILIÁRIA, SGPS, SA is owned indirectly by Inmobiliaria Chamartín.
3.3. Special rights, restrictions on transfer of shares, shareholders agreements,
rules governing the amendment of the Articles of the Company’s system of
employee participation in capital
There are no limits to the exercise of voting rights in addition to the rules outlined in chapter 1.5
of this report. The FC Porto, the main shareholder of the Company, has special rights, in compliance with the Articles of Association, and the legal system for sports companies. The shares held by
this institution always confer the right to veto decisions of the General Assembly designed to the
merger, division, transformation or dissolution of the Company and amendment of its Statute, the
increase and reduction of share capital and change the location of the head office.
The Board is unaware of any shareholders’ agreement with the nature of those mentioned in article 19 of
the Cmvm regarding the exercise of social rights or the transfer of shares of FC Porto - Futebol, SAD.
There is, in particular, no union vote or agreement of defense against a takeover bid (OPA).
There are no applicable statutorily defined rules to the amendment of Articles of Association, so
that to this subject the terms defined by law apply.
The Company has not set any plans for the allocation of shares and / or options to acquire shares or
based on changes in stock prices, to members of the board and / or employees, so there are no control
mechanisms for participation workers in the capital of the Company.
3.4. Evolution of the share price of FC Porto - Futebol, SAD
In this period the share price of FC Porto - Futebol, SAD remained fairly stable, with special emphasis to the maximum value that the shares have reached are only 16% distant of the minimum value.
Even in times of dissemination of results, and / or privileged information, there were important
fluctuations, which is a standard behaviour in company shares. The conquest of the fourth championship and an excellent performance in the Champions League had no impact on stock prices
during this financial year, despite the sporting success of the club, it lost 9%, having closed on June
30, 2009 to quote in 1 , 34 Euros and with a market capitalization of 20.1 million.
150
2008/09
Business Quantity
1.361
Transacted Shares
767.428
Average number of shares transacted by business
Net
564
1.075.920
Maximum of the Period
1,50
Minimum of the Period
1,29
Quotation at the beginning of the Period
1,48
Quotation at the end of the Period
1,34
Variation at h season
-9%
Stock capitalization
However, when comparing the price of shares of the Company with the Portuguese stock market
reality in the same period, it appears that its performance is much better than the benchmark of
national equity market, PSI-20, which depreciated by 17% in the same period, and has not reached
alarming levels due to more recovery in the last quarter.
This difference in behavior in the stock market gains more significance when compared with the
main index of the international football industry. Following the trend of the European stock markets, also the Dow Jones EuroStoxx Football, which the FC Porto - Futebol, SAD is a part, suffered a
sharp drop of around 31% during the financial period 2008/2009, despite the positive trend verified
in the last quarter.
151
20.100.000
C3 Information
3.5. Policy dividends
The FC Porto - Futebol, SAD has defined the terms of its policy of distributing dividends, and since
its establishment, has never paid dividends.
3.6. Plan allocation of shares and / or options
The Company does not have at present any kind of plan shares allotment or options to acquire shares.
3.7. Company business with related parties
There are no significant businesses in economic terms for any of the parties involved made between
the Company and members of the administrative, supervisory, holders of qualified shareholdings or
companies who are in a control or domination group, except as regards to the business or operations
that are performed in normal market conditions for similar operations and are part of the current
activities of the Company.
3.8. Investor Support
The representative of FC Porto - Futebol, SAD for capital market relations is the privileged interlocutor of all investors, institutional and private, domestic and foreign.
This representative ensures the provision of all relevant information regarding the key events, facts
considered as relevant, quarterly results and responds to any requests for information by investors
or the general public on financial information of public character. It is also in charge of all matters
pertaining to the relationship with the Cmvm, to ensure the fulfillment of obligations to the supervisor of capital markets and other financial authorities. It is also his responsibility to develop and
maintain the site’s Investor Relations web page of the company.
Under and for the purposes of paragraph 2 of art. Article 226 of the CVM, the representative of FC Porto
- Futebol, SAD for market relations is Dr. Fernando Soares Gomes da Silva, a member of the Board.
For the effects of the exercise of their duties, the address, telephone number and fax number and
e-mail address of the representative for market relations are:
Address: Estadio do Dragao, Via FC Porto, entrada poente, 3rd floor,
4350-451 Porto
Phone: 22 5070500
Fax: 22.5506931
E-Mail: [email protected]
152
The FC Porto - Futebol, SAD has an Internet site (www.fcporto.pt) with a wide range of information
on the Group. The aim is to enable interested parties to obtain comprehensive knowledge about the
Group, its business areas, information of an institutional and financial nature. On the page dedicated to Investor Relations, you can see the results of periodic disclosures, documents of accountability, information on general shareholders meetings , including meetings and supporting documentation, and information on institutions, including the Statute and the identification of the Governing
Bodies. You can also look up the holdings, all the inside information and other press releases issued
by the Company.
The Company, taking into consideration the recommendations of CMVM, is preparing its website,
available as part of the information subject to CMVM recommendation in English.
Services to shareholders and investors
All public information on the FCP-SAD is available on the premises of the Company and may be
requested through the following contacts:
F. C. Porto - Futebol, SAD
Estadio do Dragao, Via FC Porto, Entrada Poente, 3rd floor,
4350-451 Porto
Phone: 22.5070500
Fax: 22.5070550
E-mail: [email protected]
Information on the actions of FCP-SAD
Today the capital of FCP-SAD is represented by 15,000,000 ordinary shares, nominal and shares, with a nominal value of 5 euros each. The market capitalization was on 30 June 2009. around 20.1 million euros.
Bloomberg Ticker: FCP PL
Ticker Reuters: FCPP.LS
153
154
D
155
D
QUALIFYING HOLDINGS
156
Under and for the purposes of Articles 16 and 20 of the Cmvm and Article 448 of the Companies Act,
it is hereby declared that the companies and / or individuals who have a qualified social participation that exceeds the 2% 5%, 10%, 20%, a third, 50%, two thirds and 90% of the vote, according to
reports received at the headquarters of the Company, on 30 June 2009, are:
N.º of Shares
% Rights of vote
6.000.000
40%
175.000
1%
Through Reinaldo da Costa Teles Pinheiro
9.850
0%
Through Fernando Soares Gomes da Silva
960
0%
6.185.810
41%
N.º of Shares
% Rights of vote
2.718.185
18,12%
N.º of Shares
% Rights of vote
1.650.750
11,01%
980
0,01%
1.651.730
11,01%
Joaquim Francisco Alves Ferreira de Oliveira
N.º of Shares
% Rights of vote
Through the company Sportinveste - SGPS, SA
1.502.188
10,01%
Directly
Through Jorge Nuno de Lima Pinto da Costa
Total
Imobiliária Chamartín
Through the company Aplicação Urbana II - Investimento Imobiliário, SA
António Luís Alves Oliveira
Directamente
Through Francisco António de Oliveira
Total
Note: The company APLICAÇÃO URBANA II - INVESTIMENTO IMOBILIÁRIO, S.A, is owned 50% by CHAMARTIN IMOBILIÁRIA, S.G.P.S., SA The
company CHAMARTIN IMOBILIÁRIA, SGPS, SA is owned indirectly by Inmobiliaria Chamartín.
157
D
Qualifying Holdings
Shares held by members of the Board of Directors and Audit Committee
Board
Held on June 30, 2008 159,847 shares. In this period he acquired 15,153 shares, holding, on June 30,
2009 175,000 shares. According to Article 6. Of CMVM Regulation 24/2000 informed of the operations from 1 July 2008 to June 30, 2009:
Stock date
Operation
Qtd.
Price
Amount (Euro)
Balance
01-07-2008
Buy
120
1,48
178
159.967
02-07-2008
Buy
200
1,40
280
160.167
03-07-2008
Buy
130
1,45
188
160.297
04-07-2008
Buy
150
1,45
217
160.447
07-07-2008
Buy
160
1,33
212
160.607
08-08-2008
Buy
600
1,32
793
161.207
10-07-2008
Buy
100
1,32
132
161.307
11-07-2008
Buy
120
1,29
154
161.427
14-01-2008
Buy
169
1,3194
222,98
161.596
15-07-2008
Buy
100
1,3400
134,00
161.696
17-07-2008
Buy
270
1,3548
365,80
161.966
23-07-2008
Buy
100
1,4200
142,00
162.066
25-07-2008
Buy
100
1,3400
134,00
162.166
28-07-2008
Buy
230
1,3865
318,90
162,396
29-07-2008
Buy
100
1,3850
138,50
162.496
01-08-2008
Buy
150
1,3700
205,50
162.646
04-08-2008
Buy
100
1,3600
136,00
162.746
07-08-2008
Buy
150
1,4249
213,74
162.896
08-08-2008
Buy
100
1,4110
141,10
162.996
11-08-2008
Buy
100
1,4210
142,10
163.096
13-08-2008
Buy
205
1,3868
284,29
163.301
14-08-2008
Buy
305
1,3846
422,30
163.606
19-08-2008
Buy
10
1,3600
13,60
163.616
20-08-2008
Buy
100
1,4300
143,00
163.716
27-08-2008
Buy
155
1,4013
217,20
163.871
01-09-2008
Buy
10
1,4400
14,40
163.881
01-09-2008
Buy
1
1,3600
1,36
163.882
01-09-2008
Buy
100
1,4000
140,00
163.982
01-09-2008
Buy
100
1,4000
140,00
164.082
158
Stock date
Operation
Qtd.
Price
Amount (Euro)
Balance
01-09-2008
Buy
10
1,4500
14,50
164.092
01-09-2008
Buy
5
1,4500
7,25
164.097
01-09-2008
Buy
100
1,3800
138,00
164.197
01-09-2008
Buy
99
1,3500
133,65
164.296
03-09-2008
Buy
150
1,4500
217,50
164.446
04-09-2008
Buy
100
1,4300
143,00
164.546
05-09-2008
Buy
80
1,3500
108,00
164.626
16-09-2008
Buy
150
1,4233
213,50
164.776
17-09-2008
Buy
150
1,42
213,50
164.926
18-09-2008
Buy
100
1,3700
137,00
165.026
19-09-2008
Buy
200
1,4150
283,00
165.226
22-09-2008
Buy
100
1,4000
140,00
165.326
24-09-2008
Buy
100
1,3670
136,70
165.426
25-09-2008
Buy
100
1,3820
138,20
165.526
29-09-2008
Buy
110
1,3655
150,21
165.636
30-09-2008
Buy
100
1,4490
144,90
165.736
01-10-2008
Buy
100
1,3700
137,00
165.836
02-10-2008
Buy
100
1,4330
143,30
165.936
06-10-2008
Buy
105
1,3643
143,25
166.041
07-10-2008
Buy
180
1,3628
245,30
166.221
08-10-2008
Buy
505
1,3505
682,00
166.726
09-10-2008
Buy
100
1,4300
143,00
166.826
13-10-2008
Buy
630
1,4305
901,22
167.456
14-10-2008
Buy
215
1,3874
298,29
167.671
16-10-2008
Buy
100
1,3500
135,00
167.771
22-10-2008
Buy
100
1,3930
139,30
167.871
23-10-2008
Buy
100
1,4020
140,20
167.971
24-10-2008
Buy
200
1,3000
260,00
168,171
27-10-2008
Buy
465
1,2929
601,20
168.636
28-10-2008
Buy
140
1,3736
192,30
168.776
31-10-2008
Buy
100
1.3400
134,00
168.876
03-11-2008
Buy
40
1,4025
56,10
168.916
05-11-2008
Buy
100
1,3300
133,00
169.016
06-11-2008
Buy
100
1,4000
140,00
169.116
07-11-2008
Buy
100
1,3300
133,00
169.216
10-11-2008
Buy
190
1,3605
258,50
169.406
11-11-2008
Buy
115
1,3890
159,74
169.521
12-11-2008
Buy
100
1,3885
138,85
169.621
159
D
Qualifying Holdings
Stock date
Operation
Qtd.
Price
Amount (Euro)
Balance
13-11-2008
Buy
105
1,4186
148,95
169.726
14-11-2008
Buy
100
1,3200
132,00
169.826
17-10-2008
Buy
100
1,4405
144,05
169.926
19-11-2008
Buy
10
1,3500
13,50
169.936
21-01-1900
Buy
105
1,3524
142,00
170.041
26-11-2008
Buy
110
1,3564
149,20
170.151
27-11-2008
Buy
120
1,3842
166,10
170.271
28-11-2008
Buy
620
1,4123
875,63
170.891
01-12-2008
Buy
90
1,3600
122,40
170.981
02-12-2008
Buy
200
1,3700
274,00
171.181
03-12-2008
Buy
100
1,4500
145,00
171.281
19-12-2008
Buy
200
1,4100
282,00
171.481
22-12-2008
Buy
399
1,4224
567,54
171.880
24-12-2008
Buy
120
1,4500
174,00
172.000
18-02-2009
Buy
200
1,4285
285,70
172.200
20-02-2009
Buy
130
1,3908
180,80
172.330
24-02-2009
Buy
70
1,4200
99,40
172.400
24-02-2009
Buy
100
1,4200
142,00
172.500
25-02-2009
Buy
10
1,3600
13,60
172.510
25-02-2009
Buy
10
1,3600
13,60
172.520
27-02-2009
Buy
10
1,4100
1,33
172.530
27-02-2009
Buy
10
1,4100
1,33
172.540
27-02-2009
Buy
80
1,4100
1,43
172.620
02-03-2009
Buy
10
1,4300
14,30
172.630
02-03-2009
Buy
140
1,4200
198,80
172.770
05-03-2009
Buy
200
1,4000
280,00
172.970
06-03-2009
Buy
100
1,4000
140,00
173.070
11-03-2009
Buy
6
1,3800
8,28
173.076
19-03-2009
Buy
10
1,4000
14,00
173.086
19-03-2009
Buy
114
1,4000
159,60
173.200
20-03-2009
Buy
10
1,4000
14,00
173.210
20-03-2009
Buy
140
1,4000
196,00
173.350
23-03-2009
Buy
10
1,4000
14,00
173.360
23-03-2009
Buy
100
1,3500
135,00
173.460
24-03-2009
Buy
10
1,4000
14,00
173.480
24-03-2009
Buy
90
1,4000
126,00
173.570
26-03-2009
Buy
10
1,4000
14,00
173.580
26-03-2009
Buy
150
1,3100
196,50
173.730
160
Stock date
Operation
Qtd.
Price
Amount (Euro)
Balance
26-03-2009
Buy
10
1,4000
14,00
173.740
27-03-2009
Buy
100
1,3600
136,00
173.840
31-03-2009
Buy
50
1,4000
70,00
173.890
31-03-2009
Buy
50
1,4000
70,00
173.940
06-04-2009
Buy
100
1,4000
140,00
174.040
08-04-2009
Buy
2
1,3600
2,72
174.042
08-04-2009
Buy
98
1,4000
137,20
174.140
14-04-2009
Buy
10
1,4000
14,00
174.150
14-04-2009
Buy
10
1,3600
13,60
174.160
16-04-2009
Buy
20
1,3900
27,80
174.180
16-04-2009
Buy
90
1,4000
126,00
174.270
17-04-2009
Buy
10
1,4000
14,00
174.280
17-04-2009
Buy
10
1,4000
14,00
174.290
17-04-2009
Buy
90
1,4400
129,60
174.380
21-04-2009
Buy
10
1,4300
14,30
174.390
21-04-2009
Buy
75
1,3600
102,00
174.465
21-04-2009
Buy
5
1,4300
7,15
174.470
21-04-2009
Buy
10
1,3600
13,60
147.480
21-04-2009
Buy
10
1,4100
14,10
174.490
21-04-2009
Buy
10
1,3800
13,80
174.500
21-04-2009
Buy
5
1,4100
7,05
174.505
29-04-2009
Buy
100
1,3700
137,00q
174.605
04-05-2009
Buy
50
1,3700
68,50
174.655
04-05-2009
Buy
50
1,4000
70,00
174.705
13-05-2009
Buy
50
1,3400
67,00
174.755
13-05-2009
Buy
5
1,4000
7,00
174.760
15-05-2009
Buy
50
1,4100
70,50
174.810
15-05-2009
Buy
50
1,4100
70,50
174.860
15-05-2009
Buy
140
1,4100
197,40
175.000
Futebol Clube do Porto of which he is President of the Board, held on 30 June 2009, 6,000,000 shares.
Held, on June 30, 2008 960 shares. Not acquired or sold during this period any action, holding, on
June 30, 2009, 960 shares. Futebol Clube do Porto of which he is Vice-President of the Board, held on
30 June 2009, 6,000,000 shares.
161
D
Qualifying Holdings
Does not have shares. Futebol Clube do Porto of which he is Vice-President of the Board, held on 30
June 2009, 6,000,000 shares.
Held, on June 30, 2008 9,850 shares. Not acquired or sold during this period any action, holding on
30 June 2009, 9,850 shares. Futebol Clube do Porto of which he is Vice-President of the Board, held
on 30 June 2008, 6,000,000 shares.
Does not have shares.
Fiscal Council
Held, on June 30, 2008 100 shares. Not acquired or sold during this period any action, holding, on
June 30, 2009, 100 shares.
Held, on June 30, 2008 10 shares. Not acquired or sold during this period any action, holding, on June
30, 2009, 10 shares.
José Manuel Taveira dos Santos (Substitute)
Statutory Auditors
Deloitte & Associados, SROC SA represented by Jorge Beja Neves
It has no shares
162
163
164
165

Annual Report 2008-2009

Transcription

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